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<PAGE>
EXHIBIT 10.4
AMENDED AND RESTATED
AGREEMENT AND PLAN OF MERGER
BY AND BETWEEN
WORLD WASTE TECHNOLOGIES, INC.,
A CALIFORNIA CORPORATION,
ON THE ONE HAND,
AND
VERTEX ENERGY, LP,
A TEXAS LIMITED PARTNERSHIP,
VERTEX ENERGY, INC.,
A NEVADA CORPORATION,
VERTEX MERGER SUB, LLC,
A CALIFORNIA LIMITED LIABILITY COMPANY,
AND
BEN COWART,
AS AGENT FOR ALL OF THE SHAREHOLDERS OF VERTEX,
ON THE OTHER HAND
MAY 19, 2008
<PAGE>
AMENDED AND RESTATED AGREEMENT AND PLAN OF MERGER
This AMENDED AND RESTATED AGREEMENT AND PLAN OF MERGER, is made
and
entered into as of May 19, 2008 (this "AGREEMENT"), by and
between World Waste
Technologies, Inc., a California corporation ("WWT"), on the one
hand, and
Vertex Energy, LP, a Texas limited partnership ("VERTEX LP"),
Vertex Energy,
Inc., a Nevada corporation ("VERTEX NEVADA"), Vertex Merger Sub,
LLC, a
California limited liability company and wholly owned subsidiary
of Vertex
Nevada ("MERGER SUB"), and Ben Cowart, as agent ("AGENT") of all
of the
shareholders of Vertex Nevada (the "VERTEX SHAREHOLDERS"), on
the other hand.
WWT, Vertex LP, Vertex Nevada, Merger Sub and the Agent are
collectively
referred to herein as the "PARTIES". Vertex Nevada, Vertex LP,
Merger Sub and
the Agent are sometimes referred to herein as the "VERTEX
PARTIES." Capitalized
terms used and not otherwise defined herein have the meanings
set forth in
Article 1.
The Parties hereto have previously entered into an Agreement and
Plan
of Merger dated as of May 15, 2008 (the "Original Agreement").
The Parties now
desire to amend and restate the Original Agreement in its
entirety to reflect
various mutually acceptable modifications to the agreement as
originally
executed.
RECITALS
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WHEREAS, the respective Boards of Directors of WWT, Vertex
Nevada and
Merger Sub, and the partners of Vertex LP (the "PARTNERS"), have
deemed it in
the best interests of their respective corporations,
shareholders and partners
that (i) Vertex LP transfer the Vertex Business to Vertex Nevada
(the
"TRANSFER"), and (ii) immediately following the Transfer, that
WWT, Vertex
Nevada and Merger Sub enter into a business combination
transaction;
WHEREAS, in furtherance thereof, the Partners have approved
the
Transfer and the respective Boards of Directors of WWT, Vertex
Nevada and Merger
Sub each have approved this Agreement and the merger of WWT with
and into Merger
Sub(the "MERGER"), upon the terms and subject to the conditions
set forth in
this Agreement and in accordance with the provisions of the
California
Corporations Code (the "CCC");
WHEREAS, in connection with the Merger, the Parties desire to
make
certain representations, warranties, covenants and agreements
and also to
prescribe various conditions to the Merger, upon the terms and
subject to the
conditions contained herein.
NOW, THEREFORE, in consideration of the covenants, promises,
representations and warranties set forth herein, and for other
good and valuable
consideration, intending to be legally bound hereby, the Parties
agree as
follows:
ARTICLE I
DEFINITIONS
-----------
1.1 CERTAIN DEFINITIONS. The following terms shall, when used in
this
Agreement, have the following meanings:
<PAGE>
"AFFILIATE" means, with respect to any Person: (i) any Person
directly
or indirectly owning, controlling or holding with power to vote
ten percent
(10%) or more of the outstanding voting securities of such other
Person (other
than passive or institutional investors); (ii) any Person ten
percent (10%) or
more of whose outstanding voting securities are directly or
indirectly owned,
controlled or held with power to vote, by such other Person;
(iii) any Person
directly or indirectly controlling, controlled by or under
common control with
such other Person; and (iv) any officer, director or partner of
such other
Person. "Control" for the foregoing purposes shall mean the
possession, directly
or indirectly, of the power to direct or cause the direction of
the management
and policies of a Person, whether through the ownership of
voting securities or
voting interests, by contract or otherwise.
"AGENT" shall have the meaning set forth in the preamble to
this
Agreement.
"AGREEMENT" shall have the meaning set forth in the preamble to
this
Agreement.
"ALTERNATIVE ACQUISITION" shall have the meaning set forth in
Section
5.14 of this Agreement.
"BENEFIT ARRANGEMENT" means any employment, consulting,
severance or
other similar contract, plan, arrangement or policy, and each
plan, arrangement
(written or oral), program, agreement or commitment providing
for insurance
coverage (including any self-insured arrangements), workers'
compensation,
disability benefits, supplemental unemployment benefits,
vacation benefits,
retirement benefits, life, health, disability or accident
benefits or for
deferred compensation, profit-sharing bonuses, stock options,
stock purchases or
other forms of incentive compensation or post-retirement
insurance, compensation
or benefits which is not a Welfare Plan, Pension Plan or
Multiemployer Plan.
"BUSINESS DAY" means any day other than Saturday, Sunday or a
day on
which banking institutions in California or Nevada are required
or authorized to
be closed.
"CCC" shall have the meaning set forth in the recitals of
this
Agreement.
"CERTIFICATE OF MERGER" shall have the meaning set forth in
Section 2.3
of this Agreement.
"CLAIM" shall have the meaning set forth in Section 7.3 of
this
Agreement.
"CLAIM NOTICE" shall have the meaning set forth in Section 7.3
of this
Agreement.
"CLOSING" shall have the meaning set forth in Section 2.2 of
this
Agreement.
"CLOSING DATE" shall have the meaning set forth in Section 2.2
of this
Agreement.
"CMT AGREEMENTS" shall have the meaning set forth in Section
5.23 of
this Agreement
"CODE" means the United States Internal Revenue Code of 1986,
as
amended.
"COLLATERAL DOCUMENTS" mean the Cowart Employment Agreement, the
Vertex
Disclosure Schedules, the WWT Disclosure Schedules, all of the
Exhibits to this
Agreement, and any other documents, instruments and certificates
to be executed
and delivered by the Parties hereunder or thereunder.
2
<PAGE>
"CONTRACT" means any agreement, contract, note, loan, evidence
of
indebtedness, purchase order, letter of credit, indenture,
security or pledge
agreement, covenant not to compete, license, instrument,
commitment, obligation,
promise or undertaking (whether written or oral and whether
express or implied).
"COWART EMPLOYMENT AGREEMENT" shall have the meaning set forth
in
Section 5.1 of this Agreement.
"COWART GUARANTEES" shall have the meaning set forth in Section
5.2 of
this Agreement.
"DISSENTING SHARES" shall have the meaning set forth in Section
2.14 of
this Agreement.
"EFFECTIVE DATE" shall have the meaning set forth in Section 2.3
of
this Agreement.
"EFFECTIVE TIME" shall have the meaning set forth in Section 2.3
of
this Agreement.
"EMPLOYEE PLANS" means all Benefit Arrangements, Pension Plans
and
Welfare Plans.
"ERISA" shall mean the Employee Retirement Income Security Act
of 1974,
as amended.
"ERISA AFFILIATE" means any trade or business, whether or
not
incorporated, that together with Vertex LP or WWT, as
applicable, would be
deemed a single employer for purposes of Section 4001 of ERISA
or Sections
414(b), (c), (m), (n) or (o) of the Code.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended,
and the rules and regulations there under.
"FAMILY MEMBER" means, with respect to any individual (i)
the
individual, (ii) the individual's spouse, (iii) any other
natural Person who is
related to the individual or the individual's spouse within the
second degree
(including adopted children) and (iv) any other natural Person
who resides with
such individual.
"GAAP" means U.S. generally accepted accounting principles
consistently
applied, as in effect from time to time.
"INDEMNIFICATION AGREEMENTS" means those certain director and
officer
indemnification agreements by and between WWT and its officers
and directors.
"INDEPENDENT DIRECTOR" means any individual who does not
beneficially
own more than 5% of the outstanding voting shares of Vertex
Nevada, is not
employed by, or an officer of, Vertex Nevada or any Cowart
Party, is not a
director or manager of any Cowart Party, is not a family member
of Ben Cowart,
and would qualify as an "Independent Director" as defined in the
rules and
regulations of the New York Stock Exchange.
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"INTELLECTUAL PROPERTY" means all trademarks and trademark
rights,
trade names and trade name rights, service marks and service
mark rights,
service names and service name rights, patents and patent
rights, utility models
and utility model rights, copyrights, mask work rights, brand
names, trade
dress, product designs, product packaging, business and product
names, logos,
slogans, rights of publicity, trade secrets, inventions (whether
patentable or
not), invention disclosures, improvements, processes, formulae,
industrial
models, processes, designs, specifications, technology,
methodologies, computer
software (including all source code and object code), firmware,
development
tools, flow charts, annotations, all Web addresses, sites and
domain names, all
data bases and data collections and all rights therein, any
other confidential
and proprietary right or information, whether or not subject to
statutory
registration, and all related technical information, the
information set forth
in manufacturing, engineering and technical drawings, know-how
and all pending
applications for and registrations of patents, utility models,
trademarks,
service marks and copyrights, and the right to sue for past
infringement, if
any, in connection with any of the foregoing.
"LAWS" means any statute, ordinance, law, rule, regulation,
code,
injunction, judgment, order, decree, ruling, or other
requirement enacted,
adopted or applied by any Regulatory Authority, including
judicial decisions
applying common law or interpreting any other Law.
"LEGAL PROCEEDING" means any action, arbitration, audit,
hearing,
investigation, litigation or suit (whether civil, criminal,
administrative,
investigative or informal) commenced, brought, conducted or
heard by or before,
or otherwise involving, any Regulatory Authority or
arbitrator.
"LIABILITIES" means any direct or indirect liability,
indebtedness,
obligation, commitment, expense, claim, deficiency, guaranty or
endorsement of
or by any Person of any type, whether known or unknown, accrued,
absolute,
contingent, matured, unmatured, liquidated or unliquidated or
otherwise.
"LIEN" means any mortgage, pledge, lien, encumbrance, charge,
security
interest, security agreement, conditional sale or other title
retention
agreement, limitation, option, assessment, restrictive
agreement, restriction,
adverse interest, restriction on transfer or exception to or
material defect in
title or other ownership interest (including but not limited to
restrictive
covenants, leases and licenses).
"LOSSES" means any claim, liability, obligation, loss,
damage,
assessment, penalty, judgment, settlement, cost and expense,
including costs
attributable to the loss of the use of funds to the date on
which a payment is
made with respect to a matter of indemnification under Article 7
hereof, and
including reasonable attorneys' and accountants' fees and
disbursements incurred
in investigating, preparing, defending against or prosecuting
any claim.
"MAKE-WHOLE WARRANTS" shall have the same meaning set forth in
Section
6.1(i) of this Agreement.
"MATERIAL ADVERSE EFFECT" or "MATERIAL ADVERSE CHANGE" with
respect to
a Person means a material adverse effect on (i) the assets,
liabilities,
condition (financial or otherwise), properties, business or
prospectus of such
Person, (ii) the validity, binding effect or enforceability of
this Agreement or
any of the Collateral Documents against such Person or (iii) the
ability of such
Person to perform its obligations under this Agreement or any of
the Collateral
Documents.
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<PAGE>
"MERGER" shall have the meaning set forth in the recitals of
this
Agreement.
"MERGER CONSIDERATION" shall have the meaning set forth in
Section 2.6
of this Agreement.
"MERGER SUB" shall have the meaning set forth in the preamble to
this
Agreement.
"MULTIEMPLOYER PLAN" means any "multiemployer plan" as defined
in
Section 3(37) of ERISA.
"ORDER" means any writ, judgment, decree, ruling, injunction or
similar
order of any Regulatory Authority (in each such case whether
preliminary or
final).
"ORDINARY COURSE OF BUSINESS" or "ORDINARY COURSE" or any
similar
phrase means the usual and ordinary course of business of a
Party, consistent
with its past custom and practice.
"ORGANIZATIONAL DOCUMENTS" shall mean (a) the articles or
certificate
of incorporation, all certificates of determination and
designation, and the
bylaws of a corporation; (b) the partnership agreement and any
statement of
partnership of a general partnership; (c) the limited
partnership agreement and
the certificate or articles of limited partnership of a limited
partnership; (d)
the operating agreement, limited liability company agreement and
the certificate
or articles of organization or formation of a limited liability
company; (e) any
charter or similar document adopted or filed in connection with
the creation,
formation or organization of any other Person; and (f) any
amendment to any of
the foregoing.
"PARTNERS" shall have the meaning set forth in the recitals of
this
Agreement.
"PARTY" or "PARTIES" shall have the meaning set forth in the
preamble
to this Agreement.
"PENSION PLAN" means any "employee pension benefit plan" as
defined in
Section 3(2) of ERISA (other than a Multiemployer Plan) which a
Person or any
ERISA Affiliate maintains, administers, contributes to or is
required to
contribute to, or has maintained, administered, contributed to
or was required
to contribute to, or under which such Person or any ERISA
Affiliate may incur
any liability.
"PERMIT" means any license, franchise, certificate,
declaration,
waiver, exemption, variance, permit, consent, approval,
registration,
authorization, qualification or similar right granted by a
Regulatory Authority.
"PERSON" means any natural person, individual, firm,
corporation,
including a non-profit corporation, partnership, trust,
unincorporated
organization, association, limited liability company, labor
union, Regulatory
Authority or other entity.
"PROXY STATEMENT" shall have the meaning set forth in Section
5.5 of
this Agreement.
5
<PAGE>
"QUALIFIED FINANCING" means an equity financing generating
gross
proceeds to WWT Sub of at least $500,000, at a pre-money
valuation in an amount
equal to no less than the total amount of cash on hand of WWT
Sub as of the
Closing.
"REGULATORY AUTHORITY" means: any (i) federal, state, local,
municipal
or foreign government; (ii) governmental or quasi-governmental
authority of any
nature (including without limitation any governmental agency,
branch,
department, official, instrumentality or entity and any court or
other
tribunal); (iii) multi-national organization or body; or (iv)
body exercising or
entitled to exercise any administrative, executive, judicial,
legislative,
police, regulation or taxing authority or power of any
nature.
"REPRESENTATIVES" shall have the meaning set forth in Section
5.14 of
this Agreement.
"SEC" means the Securities and Exchange Commission or any
Regulatory
Authority that succeeds to its functions.
"SEC REPORTS" has the meaning set forth in the preamble to
Article 4.
"SECURITIES ACT" means the Securities Act of 1933, as amended,
and the
rules and regulations thereunder.
"SUBSIDIARY" has the meaning set forth in Section 3.1.
"SURVIVING CORPORATION" shall have the meaning set forth in
Section 2.1
of this Agreement.
"TAX RETURNS" means all federal, state, local, provincial and
foreign
tax returns, declarations, reports, claims, schedules and forms
for refund or
credit or information return or statement relating to Taxes,
including any
schedule or attachment thereto, and including any amendment
thereof.
"TAXES" means any U.S. or non U.S. federal, state, provincial,
local or
foreign (i) income, corporation gross income, gross receipts,
license, payroll,
employment, excise, severance, stamp, occupation, premium,
windfall profits,
environmental, customs duties, capital, franchise, profits,
withholding, social
security (or similar), unemployment, disability, real property,
personal
property, intangible property, recording, occupancy, sales, use,
transfer,
registration, value added minimum, ad valorem or excise tax,
estimated or other
tax of any kind whatsoever, including any interest, additions to
tax, penalties,
fees, deficiencies, assessments, additions or other charges of
any nature with
respect thereto, whether disputed or not; and (ii) any liability
for the payment
of any amount of the type described in (i) above.
"TRANSACTIONS" has the meaning set forth in Section 3.2.
"TRANSFER" shall have the meaning set forth in the recitals of
this
Agreement.
"TRANSMITTAL LETTER" has the meaning set forth in Section 2.7 of
this
Agreement.
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<PAGE>
"TREASURY REGULATIONS" means regulations promulgated by the
U.S.
Treasury Department under the Code.
"VERTEX LP" has the meaning set forth in the preamble to
this
Agreement.
"VERTEX NEVADA" has the meaning set forth in the preamble to
this
Agreement.
"VERTEX BUSINESS" means each of the following businesses owned
by
Vertex LP: (i) the business of aggregating waste oil from
third-party collectors
and managing the transportation logistics of delivering the
waste oil to a
Chevron-Texaco refining facility in Louisiana; revenue from this
business is
generated from payments made by Chevron-Texaco to Vertex LP
under an existing
contract and is based on the volume, quality and price of the
used oil feedstock
delivered to the Louisiana facility; (ii) the business of
aggregating petroleum
waste streams from third-party collectors and managing the
transportation
logistics of delivering the waste petroleum products to a
Kmtex-owned facility
in Texas; in addition to the petroleum waste stream feedstock,
this business
sources a second feedstock stream directly from a major chemical
company.
Revenue is generated by selling end products such as pygas,
gasoline blendstock
and marine diesel oil made at the Kmtex facility under a
contract refining
agreement with Vertex LP utilizing the two streams of feedstock;
and (iii) the
business of implementing proprietary re-refining technology
owned by Vertex LP.;
the re-refining technology allows this business to take
aggregated waste oil
(similar to what is currently delivered to the Chevron-Texaco
facility) and
convert it to higher value products such as marine diesel oil
and vacuum gas
oil; revenue for this business area will be generated from the
sale of the
re-refined marine diesel oil and vacuum gas oil.
For the sake of clarification, the Vertex Business does not
include the
businesses conducted by any of the Subsidiaries of Vertex
LP.
"VERTEX CAPITAL STOCK" means, collectively, the Vertex Common
Stock and
Vertex Preferred Stock.
"VERTEX COMMON STOCK" means shares of Vertex Nevada's common
stock, par
value $0.001 per share.
"VERTEX CONTRACT" has the meaning set forth in Section 3.11 of
this
Agreement.
"VERTEX FINANCIAL STATEMENTS" means the audited Consolidated
Balance
Sheets of Vertex Nevada as of December 31, 2007, 2006 and 2005,
and the audited
Consolidated Statements of Operations and Statements of
Stockholders' Equity for
the periods then ended, in each case after taking into account
the Transfer.
"VERTEX LP" has the meaning set forth in the preamble to
this
Agreement.
"VERTEX LOCK-UP" has the meaning set forth in Section 5.19 of
this
Agreement.
"VERTEX NEVADA" has the meaning set forth in the preamble to
this
Agreement.
"VERTEX PARTIES" shall have the meaning set forth in the
preamble to
this Agreement.
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"VERTEX PREFERRED STOCK" means, collectively, the Vertex Series
A
Preferred Stock and the Vertex Series B Preferred Stock.
"VERTEX SERIES A PREFERRED STOCK" means the newly created Series
A
Preferred Stock, par value $0.001 per share, of Vertex Nevada,
established and
issued in connection with the transactions contemplated by this
Agreement.
"VERTEX SERIES B PREFERRED STOCK" means the Series B Preferred
Stock,
par value $0.001 per share, of Vertex Nevada, with the terms and
conditions as
are set forth on EXHIBIT A-2 hereto.
"VERTEX SHAREHOLDERS" has the meaning set forth in the preamble
to this
Agreement.
"WELFARE PLAN" means any "employee welfare benefit plan" as
defined in
Section 3(1) of ERISA which a Person or any ERISA Affiliate
maintains,
administers, contributes to or is required to contribute to, or
under which such
Person or any ERISA Affiliate may incur any Liability.
"WWT" has the meaning set forth in the preamble to this
Agreement.
"WWT CAPITAL STOCK" means, collectively, the WWT Common Stock
and WWT
Preferred Stock.
"WWT CERTIFICATE(S)" has the meaning set forth in Section 2.7 of
this
Agreement.
"WWT COMMON STOCK" means shares of WWT's common stock, par value
0.001
per share.
"WWT CONTRACT" has the meaning set forth in Section 4.10 of
this
Agreement.
"WWT FINANCIAL STATEMENTS" means the audited Consolidated
Balance
Sheets of WWT as of December 31, 2007 and 2006, and the audited
Consolidated
Statements of Operations and Statement of Stockholders' Equity
for each of the
three years in the period ended December 31, 2007.
"WWT OPTIONS" has the meaning set forth in SECTION 2.6(C) of
this
Agreement.
"WWT PREFERRED STOCK" means, collectively, the WWT Series A
Preferred
Stock and WWT Series B Preferred Stock.
"WWT SERIES A PREFERRED STOCK" means shares of WWT's 8% Series
A
Cumulative Redeemable Convertible Participating Preferred Stock,
par value 0.001
per share.
"WWT SERIES B PREFERRED STOCK" means shares of WWT's 8% Series
B
Cumulative Redeemable Convertible Participating Preferred Stock,
par value 0.001
per share.
"WWT MANAGEMENT AGREEMENT" shall have the meaning set forth in
Section
5.6 of this Agreement.
"WWT MANAGEMENT" shall have the meaning set forth in Section 5.6
of
this Agreement.
8
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ARTICLE II
THE MERGER
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2.1 MERGER. Upon the terms and conditions set forth in this
Agreement,
and in accordance with the provisions of the CCC, at the
Effective Time, (i) WWT
shall be merged with and into Merger Sub, (ii) the separate
corporate existence
of WWT shall cease, (iii) Merger Sub, as the surviving company
in the Merger,
shall continue its existence under the laws of the State of
California as a
limited liability company, and (iv) Merger Sub shall succeed to
and assume the
rights, obligations, properties, rights, privileges, powers and
franchises of
WWT. Merger Sub, as the surviving limited liability company
after the Merger, is
sometimes referred to herein as the "SURVIVING CORPORATION."
2.2 CLOSING. Subject to the terms and conditions of this
Agreement, the
closing of the Merger (the "Closing") will take place at the
offices of
TroyGould Professional Corporation located at 1801 Century Park
East, 16th
Floor, Los Angeles, California 90067, or at such other place as
the Parties
mutually agree, at 10:00 a.m. local time on the second Business
Day after the
day on which the last of the closing conditions set forth in
Article 6 below has
been satisfied or waived, or such other date as the Parties
mutually agree upon
in writing (the "CLOSING DATE").
2.3 EFFECTIVE TIME. Upon the terms of and subject to the
conditions of
this Agreement, as soon as practicable on the Closing Date: (a)
the Parties will
cause the Merger to be consummated by filing with the Secretary
of State of the
State of California a certificate of merger (the "CERTIFICATE OF
MERGER"),
together with any required related certificates, and shall make
any other
filings or recordings required under the CCC. The Merger shall
become effective
upon such filing, or at such later date and time as is agreed to
by the Parties
and set forth in the Certificate of Merger (the date and time of
such filing
being the "EFFECTIVE TIME" and the date upon which the Effective
Time occurs,
being the "EFFECTIVE DATE"). As soon as practicable on the
Closing Date, Vertex
Nevada will deliver the Merger Consideration to the holders of
WWT Common Stock
and WWT Preferred Stock in accordance with Section 2.6
hereof.
2.4 EFFECT OF THE MERGER. At the Effective Time, in accordance
with the
CCC, the separate existence of WWT will cease and the Surviving
Corporation
shall succeed, without further action, to all the property,
assets, rights,
privileges, powers and franchises of every kind of the nature
and description of
Merger Sub and WWT. All debts, liabilities and duties of Merger
Sub and WWT will
become the debts, liabilities and duties of the Surviving
Corporation. The
Parties acknowledge that as a condition to the closing of the
transactions
contemplated hereby and in accordance with Section 5.6, all
Liabilities of WWT
(other than up to $2.4 million of indebtedness) shall,
immediately prior to the
Effective Time, be satisfied in full. As of the Effective Time,
the Surviving
Corporation will be a single member limited liability company
wholly owned by
Vertex Nevada.
2.5 EFFECT OF MERGER ON OWNERSHIP INTERESTS OF MERGER SUB. At
the
Effective Time, the ownership interests of Merger Sub issued and
outstanding
immediately prior to the Effective Time shall, by virtue of the
Merger and
without any action on the part of the holder thereof, be
converted into and
become ownership interests of the Surviving Corporation.
9
<PAGE>
2.6 EFFECT OF MERGER ON CAPITAL STOCK OF WWT.
(a) WWT COMMON STOCK. At the Effective Time, each issued and
outstanding share of the WWT Common Stock shall, by virtue of
the Merger and
without any action on the part of the holders thereof, be
converted into the
right to receive one share of Vertex Common Stock.
(b) WWT SERIES A PREFERRED STOCK AND WWT SERIES B PREFERRED
STOCK.
At the Effective Time, (i) each issued and outstanding share of
WWT Series A
Preferred Stock shall by virtue of the Merger and without any
action on the part
of the holders thereof, be converted into the right to receive
4.062 shares of
Vertex Series A Preferred Stock; and (ii) each issued and
outstanding share of
WWT Series B Preferred Stock shall by virtue of the Merger and
without any
action on the part of the holders thereof, be converted into the
right to
receive 116.51 shares of Vertex Series A Preferred Stock, in
each case subject
to the terms and conditions of this Agreement. The shares of
Vertex Common Stock
and Vertex Series A Preferred Stock issuable pursuant to Section
2.6(a) and this
Section 2.6(b) are collectively referred to herein as the
"MERGER
CONSIDERATION." The terms of the Vertex Series A Preferred Stock
issuable
hereunder shall have substantially the terms and conditions as
are set forth on
EXHIBIT A-1 hereto.
(c) OUTSTANDING WWT OPTIONS AND WARRANTS. At the Effective
Time,
each outstanding option and warrant to acquire shares of WWT
Common Stock (the
"WWT OPTIONS") shall automatically become an option or warrant
to acquire an
equivalent number of shares of Vertex Common Stock.
(d) WWT CAPITAL STOCK. As a result of the Merger and without
any
action on the part of the holders thereof, at the Effective
Time, all shares of
WWT Capital Stock shall be cancelled and retired and shall cease
to be
outstanding. Each holder of shares of the WWT Capital Stock
shall thereafter
cease to have any rights with respect to such shares, except
that the issued and
outstanding shares of WWT Capital Stock immediately prior to the
Effective Time,
and the respective holders thereof, shall have the right to
receive the Merger
Consideration in accordance with this Section 2.6 upon the
surrender of the
certificate or certificates representing such shares.
(e) TREASURY STOCK. Each share of WWT Common Stock held in
Vertex
Nevada's treasury at the Effective Time, if any, shall, by
virtue of the Merger
and without any action on the part of WWT, cease to be
outstanding and shall be
cancelled and retired without payment of any Merger
Consideration or any other
consideration therefor.
2.7 DELIVERY OF WWT CERTIFICATES AND EXCHANGE PROCEDURES. At and
after
the Effective Time, Vertex Nevada will make available, and each
holder of an
issued and outstanding share of WWT Common Stock and WWT
Preferred Stock will be
entitled to receive, upon surrender to Vertex Nevada or the
Agent of any
certificates evidencing such WWT Capital Stock (the "WWT
CERTIFICATES") for
cancellation and a letter of transmittal or assignment separate
from certificate
in customary form (the "TRANSMITTAL LETTER"), the portion of the
Merger
Consideration into which such shares of WWT Capital Stock have
been converted
into pursuant to the Merger, and upon such surrender of each
such WWT
Certificate, and delivery by Vertex Nevada of the aggregate
Merger Consideration
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in exchange therefor, the WWT Common Stock and WWT Preferred
Stock evidenced by
the WWT Certificates so surrendered in accordance herewith shall
forthwith be
cancelled. Until surrendered or delivered as contemplated by
this Section 2.7,
each WWT Certificate will be deemed at any time after the
Effective Time for all
purposes to evidence only the right to receive upon such
surrender the
corresponding pro rata portion of the Merger Consideration;
PROVIDED, HOWEVER,
that Vertex Nevada shall be under no obligation to deliver the
Merger
Consideration, and no holder of an issued and outstanding share
of WWT Common
Stock or WWT Preferred Stock shall be obligated to surrender a
WWT Certificate,
as contemplated herein, until and unless of the conditions and
covenants set
forth in Article 6 hereof shall have been performed, complied
with, or otherwise
waived in accordance with the provisions of Article 6.
2.8 STOCK TRANSFER BOOKS. From and after the Effective Time, the
stock
transfer books of WWT will be closed, and there will be no
further registration
or transfers of WWT Common Stock or WWT Preferred Stock
thereafter on the
records of WWT.
2.9 NO FURTHER OWNERSHIP RIGHTS. The Merger Consideration
delivered
upon the surrender for exchange of the WWT Certificates in
accordance with the
terms hereof will be deemed to have been issued in full
satisfaction of all
rights pertaining to the WWT Common Stock and WWT Preferred
Stock evidenced by
such WWT Certificates, and there will be no further registration
of transfers of
such shares which were outstanding immediately prior to the
Effective Time on
the records of the Surviving Corporation. If, after the
Effective Time, WWT
Certificates are presented to the Surviving Corporation, they
will be cancelled
as contemplated herein.
2.10 LOST, STOLEN OR DESTROYED CERTIFICATES. In the event any
WWT
Certificates are lost, stolen or destroyed, Vertex Nevada will
issue in exchange
for such lost, stolen or destroyed WWT Certificates, upon the
making of an
affidavit of that fact by the holder thereof and the other
deliveries required
above, the applicable Merger Consideration; PROVIDED, HOWEVER,
that the
Surviving Corporation may, in its sole discretion and as a
condition precedent
to the issuance thereof, require the holder of such lost, stolen
or destroyed
WWT Certificates to deliver an indemnity or bond in such sum as
it may
reasonably direct as indemnity against any claim that may be
made against it
with respect to the WWT Certificates alleged to have been lost,
stolen or
destroyed.
2.11 CHARTER DOCUMENTS; DIRECTORS AND OFFICERS. Unless otherwise
agreed
by Vertex Nevada and WWT prior to the Closing, at and as of the
Effective Time,
without any further action on the part of the Parties: (i) the
Organizational
Documents of Merger Sub as in effect immediately prior to the
Effective Time
will be the Organizational Documents of the Surviving
Corporation at and after
the Effective Time until thereafter amended as provided by
applicable law and
such Organizational Documents; (ii) the manager of Merger Sub
immediately prior
to the Effective Time will be the initial manager of the
Surviving Corporation
from and after the Effective Time, until its successor is
appointed and
qualified or until its resignation or removal; (iii) the
officers of Merger Sub
immediately prior to the Effective Time shall serve in their
respective offices
of the Surviving Corporation from and after the Effective Time,
until their
successors are elected or appointed and qualified or until their
resignation or
removal.
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2.12 NO FRACTIONAL SHARES. No certificate or scrip
representing
fractional shares of Vertex Capital Stock shall be issued upon
the surrender of
WWT Certificates. In lieu thereof, each holder of WWT Capital
Stock who would
otherwise be entitled to a fraction of a share of Vertex Capital
Stock (after
aggregating all shares of WWT Capital Stock that otherwise would
be received by
such holder), shall receive one additional share of Vertex
Common Stock or
Vertex Preferred Stock, as applicable.
2.13 TAKING OF NECESSARY ACTION; FURTHER ACTION. Each of the
Parties
will take all such reasonable lawful action as may be necessary
or appropriate
in order to effect the Merger in accordance with this Agreement
as promptly as
practicable. If, at any time after the Effective Time, any such
further action
is necessary or desirable to carry out the purposes of this
Agreement and to
vest the Surviving Corporation with full right, title and
possession to all the
property, rights, privileges, power and franchises of WWT and
Merger Sub, the
officers, directors and managers of WWT and Merger Sub
immediately prior to the
Effective Time are fully authorized in the name of their
respective corporations
or otherwise to take, and will take, all such lawful and
necessary action.
2.14 WWT DISSENTING SHARES. Shares of WWT Common Stock and
WWT
Preferred Stock which are issued and outstanding immediately
prior to the
Effective Time and which are held by persons who are entitled to
and have
properly exercised, and not withdrawn or waived, appraisal
rights with respect
thereto in accordance with the CCC (the "DISSENTING SHARES"),
will not be
converted into the right to receive the Merger Consideration,
and holders of
such shares of WWT Common Stock and WWT Preferred Stock will be
entitled, in
lieu thereof, to receive payment of the appraised value of such
shares in
accordance with the provisions of the CCC unless and until such
holders fail to
perfect or effectively withdraw or lose their rights to
appraisal and payment
under the CCC. If, after the Effective Time, any such holder
fails to perfect or
effectively withdraws or loses such right, such shares of WWT
Common Stock and
WWT Preferred Stock will thereupon be treated as if they had
been converted at
the Effective Time into the right to receive the Merger
Consideration, without
any interest thereon.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
------------------------------
OF VERTEX PARTIES
-----------------
Each Vertex Party, jointly and severally, represents and
warrants to
WWT that the statements contained in this Article 3 are true,
complete and
correct as of the date of this Agreement and will be correct and
complete as of
the Closing Date (and as though made then and as though the
Closing Date were
substituted for the date of this Agreement throughout this
Article 3, except in
the case of representations and warranties stated to be made as
of the date of
this Agreement or as of another date and except for changes
contemplated or
permitted by this Agreement); except as the same may be
qualified or limited by
the Vertex Disclosure Schedules attached hereto:
3.1 ORGANIZATION AND QUALIFICATION; SUBSIDIARIES.
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(a) Each of Vertex LP, Vertex Nevada and Merger Sub is duly
organized, validly existing and in good standing under the Laws
of the
jurisdiction in which it is organized and has the requisite
power and authority
to carry on the Vertex Business, which such jurisdictions are
set forth on
SCHEDULE 3.1(a) of the Vertex Disclosure Schedules.
(b) Each of Vertex LP, Vertex Nevada and Merger Sub is duly
qualified or licensed to do business and is in good standing in
each
jurisdiction in which the nature of the Vertex Business or the
ownership or
leasing of its properties makes such qualification or licensing
necessary, other
than in such jurisdictions where the failure to be so qualified
or licensed
(individually or in the aggregate) has not had and would not
reasonably be
expected to have a Material Adverse Effect on Vertex Nevada or,
with respect to
the Vertex Business, on Vertex LP.
(c) Vertex Nevada has delivered to WWT complete and correct
copies
of its Organizational Documents and the same for Merger Sub, in
each case as
amended to the date hereof. The Organizational Documents of
Vertex Nevada are
attached hereto as EXHIBIT B. All of the outstanding shares of
capital stock or
other ownership interests of Vertex Nevada have been validly
issued and are
fully paid and nonassessable and are owned of record and
beneficially by the
Persons set forth on SCHEDULE 3.1(c)-1 of the Vertex Disclosure
Schedules, in
each case free and clear of all Liens, and free of any
restriction on the right
to vote, sell or otherwise dispose of such capital stock or
other ownership
interests, except for restrictions imposed by applicable
securities Laws and
except for restrictions on sale contained in the certificate of
incorporation of
Vertex Nevada. Immediately prior to the Closing, the outstanding
shares of
capital stock of Vertex Nevada will be owned of record and
beneficially by the
Persons set forth on SECTION 3.1(c)-2 of the Vertex Disclosure
Schedules.
(d) Vertex Nevada does not own, directly or indirectly, any
capital stock or other ownership interest in any corporation,
partnership, joint
venture or other entity, other than Merger Sub. One hundred
percent (100%) of
the ownership interests of Merger Sub is owned by Vertex
Nevada.
(e) Vertex Nevada has no Subsidiaries, other than Merger
Sub.
Vertex LP has no Subsidiaries, other than as set forth on
SCHEDULE 3.1(e) of the
Vertex Disclosure Schedules. As used in this Agreement, the term
"Subsidiary",
with respect to any Person, means any corporation or other legal
entity of which
such Person controls (either alone or through or together with
any other
Subsidiary), directly or indirectly, more than 50% of the
capital stock or other
ownership interests the holders of which are generally entitled
to vote for the
election of the Board of Directors or other governing body of
such corporation
or other legal entity.
3.2 AUTHORIZATION; ENFORCEABILITY. Each Vertex Party has the
requisite
power and authority, and has taken all action necessary, to
execute, deliver and
perform its or his obligations under this Agreement and any
Collateral Documents
to which it or he is or will be a party and each other
agreement, document,
instrument or certificate contemplated by this Agreement and/or
any Collateral
Documents or to be executed by such Vertex Party in connection
with the
consummation of the transactions contemplated by this Agreement
(including but
not limited to the Transfer) (the "TRANSACTIONS"), and to
consummate the
Transactions. The execution and delivery by each Vertex Party of
this Agreement
and any applicable Collateral Documents to which it or he is a
party, and the
consummation by such Vertex Party of the Transactions
contemplated hereby and
thereby, and the performance by such Vertex Party of its or his
respective
obligations hereunder and thereunder, have been duly and validly
authorized by
all necessary corporate or other action on the part of such
Vertex Party, and no
13
<PAGE>
other action on the part of such Vertex Party is required to
authorize the
execution, delivery and performance of this Agreement and the
consummation by
such Vertex Party of the Transactions. This Agreement has been
duly and validly
executed and delivered by each Vertex Party and constitutes a
legal, valid and
binding obligation of each such Vertex Party enforceable against
such Vertex
Party in accordance with its terms, except as such
enforceability may be limited
by bankruptcy, insolvency, moratorium, reorganization and other
similar laws
affecting creditors' rights generally and the general principles
of equity,
regardless of whether asserted in a proceeding in equity or at
law.
3.3 CAPITALIZATION.
(a) The authorized capital stock of Vertex Nevada as of the
date
of this Agreement consists of 750 million shares of Vertex
Common Stock, and 50
million shares of Vertex Preferred Stock. Immediately prior to
the Effective
Time (but prior to the issuance of the Merger Consideration),
there will be (i)
61,770,000 shares of Vertex Common Stock, 100 shares of Vertex
Series B
Preferred Stock and 0 shares of Vertex Series A Preferred Stock,
issued and
outstanding, all of which shares shall be owned in the amounts
and by the
holders set forth on SECTION 3.1(c)-2 of the Vertex Disclosure
Schedule; (ii) no
shares of Vertex Common Stock held in the treasury of Vertex;
(iii) 6,000,000
shares of Vertex Common Stock reserved for future issuance
pursuant to the
exercise of outstanding options; and (iv) a sufficient number of
shares of
Vertex Common Stock reserved for future issuance pursuant to the
exercise of the
Make-Whole Warrants and the WWT Options. Except as described
above, as of the
Effective Time, there will be no shares of voting or non-voting
capital stock,
equity interests or other securities of Vertex Nevada
authorized, issued,
reserved for issuance or otherwise outstanding.
(b) As of the Effective Time, all outstanding shares of
Vertex
Capital Stock will be duly authorized, validly issued, fully
paid and
non-assessable, and will not be subject to, or issued in
violation of, any
preemptive, subscription or any kind of similar rights. Vertex
Nevada has no
outstanding shares of Vertex Capital Stock subject to a right of
repurchase that
will survive the Merger.
(c) There are no bonds, debentures, notes or other indebtedness
of
either Vertex LP or Vertex Nevada having the right to vote (or
convertible into
securities having the right to vote) on any matters on which
partners of Vertex
LP or stockholders of Vertex Nevada may vote. Except as set
forth on SCHEDULE
3.3(c) of the Vertex Disclosure Schedules, there are no
outstanding securities,
options, warrants, calls, rights, commitments, agreements,
arrangements or
undertakings of any kind (contingent or otherwise) to which any
Vertex Party is
a party or bound obligating any such Vertex Party to issue,
deliver or sell, or
cause to be issued, delivered or sold, additional shares of
capital stock or
other voting securities of any Vertex Party or obligating any
Vertex Party to
issue, grant, extend or enter into any agreement to issue, grant
or extend any
security, option, warrant, call, right, commitment, agreement,
arrangement or
undertaking. No Vertex Party is subject to any obligation or
requirement to
provide funds for or to make any investment (in the form of a
loan or capital
contribution) in any Person.
14
<PAGE>
(d) All of the issued and outstanding partnership interests
of
Vertex LP have been issued in compliance in all material
respects with all
applicable federal and state securities Laws. As of the
Effective Time, all of
the issued and outstanding shares of Vertex Capital Stock will
have been issued
in compliance in all material respects with all applicable
federal and state
securities Laws.
(e) Except as set forth on SCHEDULE 3.3(e) of the Vertex
Disclosure Schedules, there are no outstanding contractual
obligations of any
Vertex Party to repurchase, redeem or otherwise acquire any
shares of capital
stock (or options or warrants to acquire any such shares) or
other security or
equity interests of any Vertex Party. Except as set forth on
SCHEDULE 3.3(e) of
the Vertex Disclosure Schedules, there are no stock-appreciation
rights,
security-based performance units, phantom stock or other
security rights or
other agreements, arrangements or commitments of any character
(contingent or
otherwise) pursuant to which any Person is or may be entitled to
receive any
payment or other value based on the revenues, earnings or
financial performance,
stock price performance or other attribute of any Vertex Party
or to cause any
Vertex Party to file a registration statement under the
Securities Act, or which
otherwise relate to the registration of any securities of any
Vertex Party.
(f) Except as set forth on SCHEDULE 3.3(f) of the Vertex
Disclosure Schedules, there are no voting trusts, proxies or
other agreements,
commitments or understandings to which any Vertex Party or, to
the knowledge of
any Vertex Party , any of the stockholders or partners of any
Vertex Party, is a
party or by which any of them is bound with respect to the
issuance, holding,
acquisition, voting or disposition of any shares of capital
stock or other
security or equity interest of any Vertex Party.
3.4 NON-CONTRAVENTION. Except as set forth on SCHEDULE 3.4 of
the
Vertex Disclosure Schedules, the execution, delivery and
performance by the
Vertex Parties of this Agreement or any applicable Collateral
Document or the
consummation by the Vertex Parties of the Transactions does not,
and the
consummation of the Transactions will not, (a) contravene,
conflict with, or
result in any violation or breach of any provision of the
Organizational
Documents of any of the Vertex Parties, (b) contravene, conflict
with, or result
in a violation or breach of any provision of any Law applicable
to the Vertex
Business, (c) require any consent or other action by any Person
under,
constitute a breach of or default under, or cause or permit the
termination,
cancellation, acceleration or other change of any right or
obligation or the
loss of any benefit to which any Vertex Party is entitled under
any provision of
any agreement or other instrument binding upon any Vertex Party
or any license,
franchise, permit, certificate, approval or other similar
authorization
affecting, or relating in any way to, the Vertex Business or (d)
result in the
creation or imposition of any Lien on any asset of any Vertex
Party, which in
the case of clauses (b) or (d) above would have a Material
Adverse Effect on
Vertex Nevada or, with respect to the Vertex Business, on Vertex
LP.
3.5 CONSENTS AND APPROVALS. Except as set forth on SCHEDULE 3.5
of the
Vertex Disclosure Schedules, no consent, approval, authorization
or order of,
registration or filing with, or notice to, any Regulatory
Authority or any other
Person is necessary to be obtained, made or given by any of the
Vertex Parties
in connection with the execution, delivery and performance by
the Vertex Parties
of this Agreement or any applicable Collateral Document or for
the consummation
by the Vertex Parties of the Transactions, except to the extent
the failure to
obtain any such consent, approval, authorization or order or to
make any such
registration or filing would not have a Material Adverse Effect
on Vertex Nevada
or, with respect to the Vertex Business, on Vertex LP.
15
<PAGE>
3.6 BOOKS AND RECORDS. Each of Vertex LP and Vertex Nevada has
made and
kept books and records and accounts, which, in reasonable
detail, accurately and
fairly reflect the activities of such Person. Neither Vertex LP
nor Vertex
Nevada has, in any manner that pertains to, or could affect, the
Vertex
Business, engaged in any transaction, maintained any bank
account or used any
corporate funds except for transactions, bank accounts and funds
that have been
and are reflected in the normally maintained books and records
of such Person.
3.7 FINANCIAL STATEMENTS. The Vertex Financial Statements to
be
delivered to WWT prior to the Closing will be prepared from the
books and
records and fairly and accurately present the financial
condition and the
results of operations, income, expenses, assets, Liabilities
(including all
reserves), changes in shareholders' equity and cash flow of
Vertex Nevada as of
the respective dates of, and for the periods referred to in,
such Vertex
Financial Statements, in accordance with GAAP applied on a
consistent basis
throughout the periods indicated.
3.8 TRANSFER. Upon consummation of the Transfer, the only assets
and
Liabilities of Vertex Nevada shall be the assets, Liabilities
and Contracts as
set forth on EXHIBIT C hereto. As of the Closing, the assets set
forth on
EXHIBIT C will, except as set forth on SCHEDULE 3.8, be owned by
Vertex Nevada
free and clear of any Liens and will be sufficient to operate
the Vertex
Business in the manner in which it is operating as of the date
hereof. As of the
Closing, there will be no Liabilities associated with the Vertex
Business that
are not set forth on EXHIBIT C. The assets and Contracts on
EXHIBIT C include
all properties, assets, privileges, powers, rights, interests
and claims of
every type and description that are owned, leased, held, used or
useful in the
Vertex Business in which Vertex LP has any right, title or
interest.
3.9 TAXES.
(a) FILING OF TAX RETURNS. Except as set forth on SCHEDULE
3.9(a)
of the Vertex Disclosure Schedules, Vertex LP will duly and
timely file (or
caused to be filed) with the appropriate taxing authorities all
Tax Returns
required to be filed through the Closing Date. All such Tax
Returns filed will,
when filed, be complete and accurate in all respects. Except as
set forth on
SCHEDULE 3.9(a) of the Vertex Disclosure Schedules, Vertex LP is
not currently
the beneficiary of any extension of time within which to file
any Tax Return. No
claim has ever been made against Vertex LP or its assets by an
authority in a
jurisdiction where Vertex LP does not file Tax Returns such that
Vertex LP is or
may be subject to taxation by that jurisdiction.
(b) PAYMENT OF TAXES. Except as set forth on SCHEDULE 3.9(b)
of
the Vertex Disclosure Schedules, all Taxes owed and due by
Vertex LP (whether or
not shown on any Tax Return) have been paid. The unpaid Taxes of
Vertex LP, if
any, (i) will not, as of December 31, 2007, exceed the reserve
for Tax Liability
(excluding any reserve for deferred Taxes established to reflect
timing
differences between book and Tax income) to be set forth on the
face of the
Vertex Financial Statements (rather than in any notes thereto),
and (ii) will
not exceed that reserve as adjusted for operations and
transactions through the
Closing Date in accordance with the past custom and practice of
Vertex LP in
filing its Tax Returns. Since December 31, 2007, Vertex LP has
not (i) incurred
any Liability for Taxes other than in the Ordinary Course of
Business or (ii)
paid Taxes other than Taxes paid on a timely basis and in a
manner consistent
with past custom and practice.
16
<PAGE>
(c) AUDITS, INVESTIGATIONS, DISPUTES OR CLAIMS. Except as
set
forth on SCHEDULE 3.9(c) of the Vertex Disclosure Schedules, no
deficiencies for
Taxes are claimed, proposed or assessed by any taxing or other
governmental
authority against Vertex LP, and there are no pending or, to the
knowledge of
Vertex LP, threatened audits, investigations, disputes or claims
or other
actions for or relating to any Liability for Taxes with respect
to Vertex LP,
and there are no matters under discussion by or on behalf of
Vertex LP with any
Regulatory Authority, or known to Vertex LP, with respect to
Taxes that are
likely to result in an additional Liability for Taxes with
respect to Vertex LP.
Audits of federal, state and local Tax Returns by the relevant
taxing
authorities have been completed for the periods set forth on
SCHEDULE 3.9(c) of
the Vertex Disclosure Schedules, and, except as set forth
thereon, none of
Vertex LP or any predecessor thereof has been notified that any
taxing authority
intends to audit a Tax Return for any other period. Vertex LP
has not waived any
statute of limitations in respect of Taxes or agreed to any
extension of time
with respect to a Tax assessment or deficiency. No power of
attorney granted by
Vertex LP with respect to any Taxes is currently in force.
(d) LIEN. There are no Liens for Taxes (other than for
current
Taxes not yet due and payable) on any assets or capital stock of
Vertex LP.
(e) TAX ELECTIONS. All material elections with respect to
Taxes
affecting Vertex or any of its assets as of the Closing Date are
set forth on
SCHEDULE 3.9(e) of the Vertex Disclosure Schedules. Vertex LP
has not: (i)
consented at any time under Section 341(f)(1) of the Code to
have the provisions
of Section 341(f)(2) of the Code apply to any disposition of any
of its assets;
(ii) agreed, and is not required, to make any adjustment under
Section 481(a) of
the Code by reason of a change in accounting method or
otherwise; (iii) made an
election, and is not required, to treat any of its assets as
owned by another
Person pursuant to the provisions of Section 168(f) of the Code
or as tax-exempt
bond financed property or tax-exempt use property within the
meaning of Section
168 of the Code; (iv) acquired, and does not own, any assets
that directly or
indirectly secure any debt the interest on which is tax exempt
under Section
103(a) of the Code; (v) made a consent dividend election under
Section 565 of
the Code; or (vi) made any of the foregoing elections and is not
required to
apply any of the foregoing rules under any comparable state or
local Tax
provision.
(f) PRIOR AFFILIATED GROUPS. Vertex LP is not and has never been
a
member of an affiliated group of corporations within the meaning
of Section 1504
of the Code. Vertex LP does not have any Liability for the Taxes
of any Person
(i) under Treasury Regulations Section 1.1502-6 (or any similar
provision of
state, local or foreign law), (ii) as a transferee or successor,
(iii) by
Contract, or (iv) otherwise.
(g) TAX SHARING AGREEMENTS. There are no agreements for the
sharing of Tax liabilities or similar arrangements (including
indemnity
arrangements) with respect to or involving Vertex LP or any of
its assets or the
Vertex Business, and, after the Closing Date, neither Vertex
Nevada nor any of
its assets or the Vertex Business shall be bound by any such
Tax-sharing
agreements or similar arrangements or have any Liability
thereunder for amounts
due in respect of periods prior to the Closing Date.
17
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(h) PARTNERSHIPS AND SINGLE MEMBER LLCS. Except as set forth
on
SCHEDULE 3.9(h) of the Vertex Disclosure Schedules, Vertex LP
(i) is not subject
to any joint venture, partnership, or other arrangement or
contract which is
treated as a partnership for Tax purposes, (ii) does not own a
single member
limited liability company which is treated as a disregarded
entity, (iii) is not
a shareholder of a "controlled foreign corporation" as defined
in Section 957 of
the Code (or any similar provision of state, local or foreign
law) and (iv) is
not a "personal holding company" as defined in Section 542 of
the Code (or any
similar provision of state, local or foreign law).
(i) NO WITHHOLDING. Vertex LP has not been a United States
real
property holding corporation within the meaning of Section
897(c)(2) of the Code
during the applicable period specified in Section 897 of the
Code. Vertex LP has
withheld and paid all Taxes required to have been withheld and
paid in
connection with amounts paid or owing to any employee,
independent contractor,
creditor, shareholder or other third party. The transactions
contemplated herein
are not subject to the tax withholding provisions of Section
3406 of the Code,
or of Subchapter A of Chapter 3 of the Code or of any other
provision of law.
(j) INTERNATIONAL BOYCOTT. Vertex LP has not participated in
and
is not participating in an international boycott within the
meaning of Section
999 of the Code.
(k) PERMANENT ESTABLISHMENT. Except as set forth on SCHEDULE
3.9(k) of the Vertex Disclosure Schedules, Vertex LP does not
have and has never
had a permanent establishment in any foreign country, as defined
in any
applicable Tax treaty or convention between the United States
and such foreign
country.
(l) PARACHUTE PAYMENTS. Except as set forth on SCHEDULE 3.9(l)
of
the Vertex Disclosure Schedules, Vertex LP is not a party to any
existing
Contract, arrangement or plan that has resulted or would result
(upon the
Closing or otherwise), separately or in the aggregate, in the
payment of any
"excess parachute payments" within the meaning of Section 280(g)
of the Code.
(m) TAX SHELTERS. Vertex LP has not participated in and Vertex
LP
is not now participating in, any transaction described in
Section 6111(c) or (d)
of the Code or Section 6112(b) of the Code or the Treasury
Regulations
thereunder, or in any reportable transaction described in such
regulations.
3.10 INTELLECTUAL PROPERTY.
(a) Except as set forth on SCHEDULE 3.10 hereto, Vertex LP
owns,
or is licensed or otherwise possesses legally enforceable rights
to use, all
Intellectual Property that is necessary for the conduct of the
Vertex Business
(b) The Vertex Business, including the use of all owned and
licensed Intellectual Property, does not infringe or
misappropriate or otherwise
materially violate the Intellectual Property rights of any third
party, and no
claim is pending or, to the knowledge of the Vertex Parties,
threatened against
Vertex LP alleging any of the foregoing.
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(c) To the knowledge of the Vertex Parties, (i) no third party
is
engaging in any activity that infringes or misappropriates the
Intellectual
Property owned or licensed by Vertex LP, and (ii) Vertex LP has
not granted any
material license or other right to any third party with respect
to such
Intellectual Property.
(d) Vertex LP has made available to WWT all material
correspondence and all written opinions in its possession
relating to potential
infringement or misappropriation (i) by Vertex LP of any
Intellectual Property
rights of any third party or (ii) by any third party of any of
the Intellectual
Property rights, owned or licensed, used in the Vertex
Business.
(e) Vertex LP has a license to use all software development
tools,
library functions, compilers and other third-party software that
are used in the
operation of the Vertex Business and are material to the Vertex
Business, taken
as a whole.
3.11 CONTRACTS; NO DEFAULTS.
(a) SCHEDULE 3.11(a) hereto sets forth a true and complete list
of
all contracts, agreements, leases, commitments or other
understandings or
arrangements, written or oral, express or implied, to which
Vertex LP is a
party, or affecting the Vertex Business, or by which Vertex LP
or any of its
property is bound or affected requiring payments to or from, or
incurring of
liabilities by, Vertex LP in excess of $50,000 (the "VERTEX
CONTRACTS").
(b) Except as set forth on SCHEDULE 3.11(b) hereto, Vertex LP
has
complied with and performed, in all material respects, all of
its obligations
required to be performed under and is not in default with
respect to any of the
Vertex Contracts, as of the date hereof, nor has any event
occurred which has
not been cured which, with or without the giving of notice,
lapse of time, or
both, would constitute a default in any respect thereunder. To
the knowledge of
the Vertex Parties, no other party has failed to comply with or
perform, in all
material respects, any of its obligations required to be
performed under or is
in material default with respect to any such Vertex Contracts,
as of the date
hereof, nor has any event occurred which, with or without the
giving of notice,
lapse of time or both, would constitute a material default in
any respect by
such party thereunder.
(c) Except as set forth on SCHEDULE 3.11(c) hereto, to the
knowledge of the Vertex Parties, there exists no facts or
circumstances that
would make a material default by any party to any contract or
obligation likely
to occur subsequent to the date hereof.
3.12 EMPLOYEE BENEFITS.
(a) SCHEDULE 3.12(a) of the Vertex Disclosure Schedules sets
forth
a complete list of all Employee Plans covering employees,
directors or
consultants or former employees, directors or consultants in, or
related to, the
Vertex Business. Vertex LP has delivered or made available to
WWT true and
complete copies of all Employee Plans, including written
interpretations thereof
and written descriptions thereof which have been distributed to
Vertex LP's
employees and for which Vertex LP has copies, all annuity
contracts or other
funding instruments relating thereto, and a complete description
of all Employee
Plans which are not in writing.
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<PAGE>
(b) Neither Vertex LP nor any ERISA Affiliate sponsors,
maintains,
contributes to or has an obligation to contribute to, or has
sponsored,
maintained, contributed to or had an obligation to contribute
to, any Pension
Plan subject to Title IV of ERISA, or any Multiemployer
Plan.
(c) Each Welfare Plan which covers or has covered employees
or
former employees of Vertex LP or of its Affiliates in the Vertex
Business and
which is a "group health plan," as defined in Section 607(1) of
ERISA, has been
operated in compliance with provisions of Part 6 of Title I,
Subtitle B of ERISA
and Section 4980B of the Code at all times.
(d) There is no Legal Proceeding or Order outstanding, relating
to
or seeking benefits under any Employee Plan set forth on
SCHEDULE 3.12(a) of the
Vertex Disclosure Schedules, which is pending, threatened or
anticipated against
Vertex LP, any ERISA Affiliate or any Employee Plan.
(e) Neither Vertex LP nor any ERISA Affiliate has any
liability
for unpaid contributions under Section 515 of ERISA with respect
to any Welfare
Plan covering employees, directors or consultants or former
employees, directors
or consultants in, or related to, the Vertex Business.
(f) There are no Liens arising under the Code or ERISA with
respect to the operation, termination, restoration or funding of
any Employee
Plan set forth on SCHEDULE 3.12(a) of the Vertex Disclosure
Schedules, or
arising in connection with any excise tax or penalty tax with
respect to such
Employee Plan.
(g) Each Employee Plan set forth on SCHEDULE 3.12(a) of the
Vertex
Disclosure Schedules has at all times been maintained in all
material respects,
by its terms and in operation, in accordance with all applicable
laws,
including, without limitation, ERISA and the Code.
(h) Vertex LP and its ERISA Affiliates have made full and
timely
payment of all amounts required to be contributed under the
terms of each
Employee Plan and applicable Law or required to be paid as
expenses or as Taxes
under applicable Laws, under such Employee Plan, and Vertex LP
and its ERISA
Affiliates shall continue to do so through the Closing Date.
(i) Vertex LP has no Employee Plan intended to qualify under
Section 401 of the Code.
(j) Neither the execution and delivery of this Agreement or
other
related agreements by the Vertex Parties nor the consummation of
the
Transactions will result in the acceleration or creation of any
rights of any
person to benefits under any Employee Plan (including, without
limitation, the
acceleration of the vesting or exercisability of any stock
options, the
acceleration of the vesting of any restricted stock, the
acceleration of the
accrual or vesting of any benefits under any Pension Plan or the
acceleration or
creation of any rights under any severance, parachute or change
in control
agreement).
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<PAGE>
(k) Neither Vertex LP nor any ERISA Affiliate has incurred
any
liability with respect to any Employee Plan, which may create,
or result in any
liability to Vertex Nevada.
3.13 LABOR MATTERS; EMPLOYEES. Except as set forth on SCHEDULE
3.13 of
the Vertex Disclosure Schedules, Vertex LP is not a party to any
collective
bargaining or other labor contract. There has not been, there is
not presently
pending or existing, and, to the knowledge of any of the Vertex
Parties, there
is not threatened (i) any strike, slowdown, picketing, work
stoppage or employee
grievance process against Vertex LP or the Vertex Business; (ii)
any Legal
Proceeding against or affecting Vertex LP or the Vertex Business
relating to the
alleged violation of any Law or Order pertaining to labor
relations or
employment matters; or (iii) union organizing campaign or any
application for
certification of a collective bargaining agent. No event has
occurred or
circumstance exists that could provide the basis for any work
stoppage or other
labor dispute. There is no lockout of any employees by Vertex
LP, and no such
action is contemplated by Vertex LP. Vertex LP has complied with
all material
Laws relating to employment, equal employment opportunity,
nondiscrimination,
harassment, retaliation, immigration, wages, hours, benefits,
collective
bargaining, the payment of social security and similar Taxes,
occupational
health and safety, and plant closing. Vertex LP is not liable
for the payment of
any compensation, damages, Taxes, fines, penalties or other
amounts (including,
without limitation, amounts related to workplace safety and
insurance), however
designated, for failure to comply with any of the foregoing
Laws.
3.14 LEGAL PROCEEDINGS. There is no material Legal Proceeding or
Order
(a) pending or, to the knowledge of any of the Vertex Parties,
threatened or
anticipated against or affecting the Vertex Business (or to the
knowledge of any
of the Vertex Parties, pending or threatened, against any of the
officers,
directors or employees of Vertex LP with respect to their
business activities
related to or affecting the Vertex Business); (b) that
challenges or that may
have the effect of preventing, making illegal, delaying or
otherwise interfering
with any of the Transactions; or (c) related to the Vertex
Business. To the
knowledge of the Vertex Parties, there is no reasonable basis
for any such Legal
Proceeding or Order. To the knowledge of the Vertex Parties, no
officer,
director, partner, agent or employee of Vertex LP is subject to
any Order that
prohibits such officer, director, partner, agent or employee
from engaging in or
continuing any conduct, activity, or practice relating to the
Vertex Business.
The Vertex Business is not subject to any Order of any
Regulatory Authority and
Vertex LP is not engaged in any Legal Proceeding relating to the
Vertex Business
to recover monies due it or for damages sustained by it. Vertex
LP is not and
has not been in default with respect to any Order relating to
the Vertex
Business, and there are no unsatisfied judgments against Vertex
LP relating to
the Vertex Business. There are no Orders or agreements with, or
Liens by, any
Regulatory Authority or quasi-governmental entity relating to
any environmental
Law, which regulate, obligate, bind or in any way affect Vertex
LP or any
property on which Vertex LP operates the Vertex Business.
SCHEDULE 3.14 sets
forth all litigation that the Vertex Parties are subject to,
none of which
litigation challenges or may have the effect of preventing,
making illegal,
delaying or otherwise interfering with any of the Transactions
or is related in
any way to the Vertex Business.
21
<PAGE>
3.15 COMPLIANCE WITH LAW.
(a) To the knowledge of Vertex LP, the conduct of the Vertex
Business is and at all times has been in compliance with all
Laws or Orders
applicable to the conduct and operations of the Vertex Business.
Vertex LP has
not received any notice to the effect that, or otherwise been
advised of (i) any
actual, alleged, possible or potential violation of, or failure
to comply with,
any such Laws or Orders or (ii) any actual, alleged, possible or
potential
obligation on the part of Vertex LP to undertake, or to bear all
or any portion
of the cost of, any remedial action of any nature with respect
to the Vertex
Business. No event has occurred or circumstance exists that
(with or without
notice or lapse of time) (i) may constitute or result in a
violation by Vertex
LP of, or a failure on the part of Vertex LP, any such Laws or
Orders or (ii)
may give rise to any obligation on the part of Vertex LP to
undertake, or to
bear all or any portion of the cost of, any remedial action of
any nature,
except, in either case separately or the cases together, where
such violation or
failure to comply could not reasonably be expected to have a
Material Adverse
Effect on, the Vertex Business.
(b) None of Vertex LP, or any of its directors, officers or
Representatives or to the knowledge of Vertex LP, any employee
or other Person
affiliated with or acting for or on behalf of Vertex LP, has,
directly or
indirectly, (i) made any contribution, bribe, rebate, payoff,
influence payment,
kickback or other payment to any Person, private or public,
regardless of form,
whether in money, property or services (A) to obtain favorable
treatment in
securing business, (B) to pay for favorable treatment for
business secured, (C)
to obtain special concessions or for special concessions already
obtained, for
or in respect of Vertex or any of its Affiliates or (D) in
violation of any Laws
of the United States (including, without limitation, the Foreign
Corrupt
Practices Act of 1977, as amended (15 U.S.C. Sections 78dd-1 et
seq.)) or any
laws of any other country having jurisdiction; or (ii)
established or maintained
any fund or asset that has not been recorded in the books and
records of Vertex
LP.
3.16 PERMITS. SCHEDULE 3.16(a) of the Vertex Disclosure
Schedules sets
forth a complete list of all Permits held by Vertex LP and used
in the conduct
of the Vertex Business, and such Permits collectively constitute
all of the
Permits necessary for Vertex LP to lawfully conduct and operate
the Vertex
Business, as it is presently conducted and to permit Vertex LP
to own and use
its assets in the manner in which they are presently owned and
used in
connection with the Vertex Business. All of such Permits will be
transferred to
Vertex Nevada on or prior to the Closing, and no third-party
consent is required
in connection therewith. Except as set forth on SCHEDULE 3.16(b)
of the Vertex
Disclosure Schedules, Vertex LP is and at all times has been in
compliance with
all material Permits applicable to it or to the conduct and
operations of the
Vertex Business. Vertex LP has not received any notice to the
effect that, or
otherwise been advised of (i) any actual, alleged, possible or
potential
violation of, or failure to comply with, any such Permits or
(ii) any actual,
alleged, possible or potential revocation, withdrawal,
suspension, cancellation
or termination of, or any modification to, any Permit set forth
on or required
to be set forth on SCHEDULE 3.16(a) of the Vertex Disclosure
Schedules. No event
has occurred, and to Vertex LP's knowledge no circumstance
exists, that (with or
without notice or lapse of time) (i) may constitute or result
directly or
indirectly in a violation by Vertex LP of, or a failure on the
part of Vertex LP
to comply with, any such Permits or (ii) result directly or
indirectly in the
revocation, withdrawal, suspension, cancellation or termination
of, or any
modification to, any Permit set forth on or required to be set
forth on SCHEDULE
3.16(a) of the Vertex Disclosure Schedules. All applications for
or renewals of
22
<PAGE>
all Permits have been timely filed and made and no Permit will
expire or be
terminated as a result of the consummation of the transactions
contemplated by
this Agreement. No present or former shareholder, partner,
director, officer or
employee of Vertex LP or any Affiliate thereof, or any other
Person, owns or has
any proprietary, financial or other interest (direct or
indirect) in any Permit
that Vertex LP owns, possesses or uses.
3.17 ABSENCE OF CERTAIN CHANGES. Except as set forth on SCHEDULE
3.17
of the Vertex Disclosure Schedules, since December 31, 2007,
there has not been
any: (a) Material Adverse Effect with respect to the Vertex
Business, and no
event has occurred and no circumstance exists that may result in
such a Material
Adverse Effect other than Material Adverse Effects resulting
from historical
seasonality of the Vertex Business; (b) purchase, redemption,
retirement or
other acquisition by Vertex LP of any Vertex partnership
interests or other
equity interest of Vertex LP; (c) amendments to the
Organizational Documents of
Vertex LP; (d) payment or increase by Vertex LP of any bonuses,
salaries or
other compensation (including management or other similar fees)
or entry into
any employment, severance or similar Contract with any employee
engaged in the
Vertex Business, other than increases in salary to employees
made in the
Ordinary Course of Business; (e) adverse change in employee
relations which has
or is reasonably likely to have a Material Adverse Effect on
Vertex LP as
relates to the Vertex Business; (f) damage to or destruction or
loss of any of
the assets or property of Vertex LP relating to the Vertex
Business, whether or
not covered by insurance, that could reasonably be expected to
constitute a
Material Adverse Effect on Vertex LP as relates to the Vertex
Business; (g)
entry into, termination or acceleration of, or receipt of notice
of termination
by Vertex LP of (1) any material license, distributorship,
dealer, sales
representative, joint venture, credit or similar agreement
relating to the
Vertex Business, or (2) any Contract or transaction involving a
Liability by or
to Vertex LP (other than the Liabilities relating to the Vertex
Business
incurred in the Ordinary Course of Business since December 31,
2007); (h) sale
(other than sales of inventory in the Ordinary Course of
Business, if any),
lease or other disposition of any of the assets or property of
Vertex LP
relating to the Vertex Business; (i) mortgage, pledge or
imposition of any Lien
on any assets or property of Vertex LP relating to the Vertex
Business,
including the sale, lease or other disposition of any of its
Intellectual
Property relating to the Vertex Business; (j) (1) delay or
failure to repay when
due any obligation of Vertex LP, which delay or failure could
have a Material
Adverse Effect on Vertex LP as relates to the Vertex Business,
or (2) delay or
failure to repay when due any obligation of Vertex LP which
delay or failure
could have a Material Adverse Effect on Vertex LP as relates to
the Vertex
Business; (k) cancellation or waiver by Vertex LP of any claims
or rights with a
value to Vertex LP relating to the Vertex Business in excess of
Fifty Thousand
Dollars ($50,000) individually or in the aggregate; (l) failure
by Vertex LP to
use reasonable efforts to preserve intact the current business
organization of
Vertex LP relating to the Vertex Business, and maintain the
relations and
goodwill with its suppliers, customers, landlords, creditors,
employees,
licensors, resellers, distributors, agents and others having
business
relationships with them relating to the Vertex Business where
such failure could
reasonably be expected to have a Material Adverse Effect on
Vertex LP as relates
to the Vertex Business; (m) licensing out on an exclusive basis
or other than in
the Ordinary Course of Business, disposition or lapsing of any
Intellectual
Property or any disclosure to any Person of any trade secret or
other
confidential information without appropriate protections in
place; (n) change in
the accounting methods, principles or practices used by Vertex
LP; (o) capital
expenditures by Vertex LP relating to the Vertex Business in
excess of $20,000
23
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individually or $50,000 in the aggregate; or (p) agreement,
whether oral or
written, by Vertex LP with respect to or to do any of the
foregoing other than
as expressly provided for herein. Vertex LP is not as of the
date hereof, and
after giving effect to the transactions contemplated hereby to
occur at the
Closing, will not be Insolvent (as defined below). For purposes
of this Section
3.17, "INSOLVENT" means (i) the present fair saleable value of
Vertex LP's
assets is less than the amount required to pay Vertex LP's total
indebtedness,
contingent or otherwise, (ii) Vertex LP is unable to pay its
debts and
Liabilities, subordinated, contingent or otherwise, as such
debts and
Liabilities become absolute and matured, (iii) Vertex LP intends
to incur or
believes that it will incur debts that would be beyond its
ability to pay as
such debts mature or (iv) Vertex LP has unreasonably small
capital with which to
conduct the business in which it is engaged as such business is
now conducted
and is proposed to be conducted.
3.18 INSURANCE. SCHEDULE 3.18 of the Vertex Disclosure Schedules
sets
forth a complete and accurate list (showing as to each policy or
binder the
carrier, policy or binder the carrier, policy number, coverage
limits,
expiration dates, annual premiums and a general description of
the type of
coverage provided) of all policies or binders of insurance of
any kind or nature
covering the Vertex Business, or any employees, properties or
assets of Vertex
LP relating to the Vertex Business, including, without
limitation, policies of
life, disability, fire, theft, workers compensation, employee
fidelity and other
casualty and liability insurance. All such policies are in full
force an effect.
Vertex LP is not in default under any of such policies or
binders, and Vertex LP
has not failed to give any notice or to present any claim under
any such policy
or binder in a due and timely fashion.
3.19 RESTRICTIONS ON BUSINESS ACTIVITIES. There is no
agreement,
judgment, injunction, order or decree binding upon Vertex LP
which has the
effect of prohibiting or materially impairing (a) any current or
future business
practice of Vertex LP or (b) any acquisition of any Person or
property by Vertex
LP, except in each of clauses (a) and (b) for any such
prohibitions or
impairments that would not reasonably be expected to have a
Material Adverse
Effect on Vertex LP as relates to the Vertex Business.
3.20 RELATED PARTY TRANSACTIONS. Except as set forth on SCHEDULE
3.20
of the Vertex Disclosure Schedules, none of Vertex LP, any
Affiliate thereof,
holders of the ownership interest of Vertex LP or any Affiliate
or Family Member
thereof is presently or has, since December 31, 2007, borrowed
any moneys from
or has any outstanding debt or other obligations to Vertex LP or
is presently a
party to any transaction with Vertex LP relating to the Vertex
Business. Except
as set forth on SCHEDULE 3.20 of the Vertex Disclosure
Schedules, none of Vertex
LP any Affiliate thereof, or any director, officer, partner or
key employee of
any such Persons (a) owns any direct or indirect interest of any
kind in (except
for ownership of less than 1% of any public company, provided,
that such owner's
role is that solely of a passive investor), or controls or is a
director,
officer, employee or partner of, consultant to, lender to or
borrower from, or
has the right to participate in the profits of, any Person which
is (i) a
competitor, supplier, customer, landlord, tenant, creditor or
debtor of Vertex
LP, (ii) engaged in a business related to the Vertex Business or
(iii) a
participant in any transaction to which Vertex LP is a party, or
(b) is a party
to any Contract with Vertex LP. Except as set forth on SCHEDULE
3.20 of the
Vertex Disclosure Schedules, Vertex LP has no Contract or
understanding with any
officer, director or key employee of Vertex LP or any of Vertex
LP's partners or
any Affiliate or Family Member thereof with respect to the
subject matter of
this Agreement, the consideration payable hereunder or any other
matter.
SCHEDULE 3.20 sets forth each transaction that Vertex Nevada and
Vertex LP would
be required to disclose for the past three years pursuant to
Item 404 of
Regulation S-K of the Securities Act, as if such Person were
subject to such
disclosure requirements.
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3.21 BROKERS OR FINDERS. Except as set forth on SCHEDULE 3.21 of
the
Vertex Disclosure Schedules, all negotiations relative to this
Agreement and the
transactions contemplated hereby have been carried out by Vertex
LP or its
Affiliates in connection with the transactions contemplated by
this Agreement,
and neither Vertex LP nor any of its Affiliates has incurred any
obligation to
pay any brokerage or finder's fee or other commission in
connection with the
transactions contemplated by this Agreement.
3.22 NO OTHER AGREEMENTS. Except as set forth on SCHEDULE 3.22
of the
Vertex Disclosure Schedules, and other than this Agreement or
any agreement
contemplated hereby, neither Vertex LP, nor any of its partners,
officers,
directors or Affiliates has any legal obligation, absolute or
contingent, to any
other Person to sell, assign or transfer any partnership or
other equity
interest in Vertex LP or to effect any merger, consolidation or
other
reorganization of Vertex LP or to enter into any agreement with
respect thereto.
3.23 DISCLOSURE. No representation or warranty of the Vertex
Parties in
this Agreement or in any Collateral Document and no statement in
any certificate
furnished or to be furnished by any of the Vertex Parties
pursuant to this
Agreement contained, contains or will contain on the date such
agreement or
certificate was or is delivered, or on the Closing Date, any
untrue statement of
a material fact, or omitted, omits or will omit on such date to
state any
material fact necessary in order to make the statements made, in
light of the
circumstances under which they were made, not misleading.
3.24 REAL PROPERTY; TITLE TO PROPERTY.
(a) Vertex LP does not own any real property or any
interest,
other than a leasehold interest, in any real property. SCHEDULE
3.24(a) of the
Vertex Disclosure Schedules lists and describes all real
property leased by
Vertex LP and all subleases thereto, in each case that relates
to the Vertex
Business. Except for leases and subleases listed on SCHEDULE
3.24(a) of the
Vertex Disclosure Schedules, there are no leases, subleases,
licenses, occupancy
agreements, options, rights, concessions or other agreements or
arrangements,
written or oral, granting to any Person the right to purchase,
use or occupy any
real property used in connection with the Vertex Business or any
portion thereof
or interest in any such real property.
(b) Vertex LP has good and marketable title to all of its
properties, interests in properties and assets, real and
personal, used in
connection with the Vertex Business or with respect to leased
properties and
assets, valid leasehold interests in, free and clear of all
mortgages, Liens,
pledges, charges or encumbrances of any kind or character,
except (i) Liens for
current Taxes not yet due and payable or which are being
contested by Vertex LP
in good faith, (ii) such imperfections of title, liens and
easements as do not
and will not materially detract from or interfere with the use
of the properties
subject thereto or affected thereby, or otherwise materially
impair business
operations involving such properties, and (iii) any Liens set
forth on SCHEDULE
3.24 of the Vertex Disclosure Schedules. The properties and
equipment of Vertex
LP that are used in the operation of the Vertex Business are in
good operating
condition subject to normal wear and tear. All material
properties used in the
Vertex Business are set forth on EXHIBIT C hereto.
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3.25 STATUS OF VERTEX NEVADA. Since its inception, Vertex Nevada
has
been, and until immediately prior to the Transfer (which will
occur immediately
prior to the Effective Time), Vertex Nevada shall remain, a
shell company with
no assets, Liabilities, Contracts (other than this Agreement) or
operations.
3.26 CONDUCT OF BUSINESS. Prior to the Closing Date, Vertex LP
shall
conduct the Vertex Business in the normal course, and shall not
sell, pledge, or
assign any assets, without the prior written approval of WWT,
except in the
regular course of business. Except as otherwise provided herein,
neither Vertex
LP nor Vertex Nevada shall amend its respective Organizational
Documents,
declare dividends, redeem or sell stock, partnership or other
securities,
acquire or dispose of fixed assets, change employment terms,
enter into any
material or long-term contract, guarantee obligations of any
third party, settle
or discharge any material balance sheet receivable for less than
its stated
amount, pay more on any liability than its stated amount or
enter into any other
transaction other than in the regular course of business.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF WWT
-------------------------------------
WWT represents and warrants to the Vertex Parties that the
statements
contained in this Article 4 are true, complete and correct as of
the date of
this Agreement and will be correct and complete as of the
Closing Date (and as
though made then and as though the Closing Date were substituted
for the date of
this Agreement throughout this Article 4, except in the case of
representations
and warranties stated to be made as of the date of this
Agreement or as of
another date and except for changes contemplated or permitted by
this
Agreement); except as the same may be qualified or limited by
the WWT Disclosure
Schedules and except as may be disclosed in documents filed by
WWT from time to
time with the SEC (the "SEC REPORTS"):
4.1 ORGANIZATION AND QUALIFICATION; SUBSIDIARIES.
(a) WWT is duly organized, validly existing and in good
standing
under the Laws of the jurisdiction in which it is organized and
has the
requisite power and authority to carry on its business as now
being conducted,
which such jurisdictions are set forth on SCHEDULE 4.1(a) hereto
of the WWT
Disclosure Schedules.
(b) WWT is duly qualified or licensed to do business and is
in
good standing in each jurisdiction in which the nature of its
business or the
ownership or leasing of its properties makes such qualification
or licensing
necessary, other than in such jurisdictions where the failure to
be so qualified
or licensed (individually or in the aggregate) has not had and
would not
reasonably be expected to have a Material Adverse Effect on
WWT.
(c) WWT has delivered or made available to the Vertex
Parties
complete and correct copies of its Organizational Documents, in
each case as
amended to the date hereof. All of the outstanding shares of
capital stock or
other ownership interests of each Subsidiary of WWT have been
validly issued and
are fully paid and nonassessable and owned by WWT, free and
clear of all Liens,
and free of any restriction on the right to vote, sell or
otherwise dispose of
such capital stock or other ownership interests, except for
restrictions imposed
by applicable securities Laws.
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(d) There are no outstanding (i) securities of WWT or any of
its
Subsidiaries convertible into or exchangeable for shares of
capital stock or
other ownership interests in any Subsidiary of WWT, or (ii)
options or other
rights to acquire from WWT or any of its Subsidiaries, or other
obligation of
WWT or any of its Subsidiaries to issue, any capital stock or
other ownership
interests in, or any securities convertible into or exchangeable
for any capital
stock or other ownership interests in, any Subsidiary of
WWT.
(e) Except for ownership of less than 1% in any publicly
traded
company and the capital stock or other ownership interests of
its Subsidiaries,
WWT does not own, directly or indirectly, any capital stock or
other ownership
interest in any corporation, partnership, joint venture or other
entity. No
Subsidiary of WWT owns any shares of WWT Capital Stock.
(f) SCHEDULE 3.1 of the WWT Disclosure Schedules sets forth
each
Subsidiary of WWT as of the date of this Agreement.
4.2 AUTHORIZATION; ENFORCEABILITY. WWT has the requisite power
and
authority, and has taken all action necessary, to execute,
deliver and perform
its obligations under this Agreement and any Collateral
Documents to which it is
a party and each other agreement, document, instrument or
certificate
contemplated by this Agreement and/or any Collateral Documents
or to be executed
by WWT in connection with the consummation of the Transactions,
and, subject to
approval of the stockholders of WWT, to consummate the
Transactions. The
execution and delivery by WWT of this Agreement and any
applicable Collateral
Documents, and the consummation by WWT of the Transactions
contemplated hereby,
and the performance by WWT of its obligations hereunder, have
been duly and
validly authorized by all necessary corporate or other action on
the part of
WWT, subject to adoption of this Agreement by the stockholders
of WWT, and no
other action on the part of WWT is required to authorize the
execution, delivery
and performance of this Agreement and the consummation by WWT of
the
Transactions. This Agreement has been duly and validly executed
and delivered by
WWT and constitutes a legal, valid and binding obligation of WWT
enforceable
against WWT in accordance with its terms, except as such
enforceability may be
limited by bankruptcy, insolvency, moratorium, reorganization
and other similar
laws affecting creditors' rights generally and the general
principles of equity,
regardless of whether asserted in a proceeding in equity or at
law.
4.3 CAPITALIZATION.
(a) The authorized capital stock of WWT as of the date of
this
Agreement consists of 100,000,000 shares of WWT Common Stock and
10,000,000
shares of Preferred Stock (of which 9,100,000 shares have been
designated as WWT
Series A Preferred Stock and 500,000 shares have been designated
as WWT Series B
Preferred Stock). As of the date of this Agreement, (i) there
are 27,596,591
shares of WWT Common Stock, 4,619,481 shares of WWT Series A
Preferred Stock,
and 244,615 shares of WWT Series B Preferred Stock issued and
outstanding; and
(ii) no shares of WWT Common Stock are held in the treasury of
WWT. SCHEDULE
4.3(a) of the WWT Disclosure Schedules set forth the options and
warrants to
acquire WWT Capital Stock outstanding as of the date hereof.
Except as described
above, as of the close of business on the day prior to the date
hereof, there
were no shares of voting or non-voting capital stock, equity
interests or other
securities of WWT authorized, issued, reserved for issuance or
otherwise
outstanding.
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(b) All outstanding shares of WWT Capital Stock are duly
authorized, validly issued, fully paid and non-assessable, and
not subject to,
or issued in violation of, any preemptive, subscription or any
kind of similar
rights. WWT has no outstanding shares of WWT Capital Stock
subject to a right of
repurchase that will survive the Merger.
(c) There are no bonds, debentures, notes or other indebtedness
of
WWT having the right to vote (or convertible into securities
having the right to
vote) on any matters on which stockholders of WWT may vote.
Except as set forth
in the SEC Reports, there are no outstanding securities,
options, warrants,
calls, rights, commitments, agreements, arrangements or
undertakings of any kind
(contingent or otherwise) to which WWT is a party or bound
obligating WWT to
issue, deliver or sell, or cause to be issued, delivered or
sold, additional
shares of capital stock or other voting securities of WWT or
obligating WWT to
issue, grant, extend or enter into any agreement to issue, grant
or extend any
security, option, warrant, call, right, commitment, agreement,
arrangement or
undertaking. Neither WWT nor its Subsidiaries is subject to any
obligation or
requirement to provide funds for or to make any investment (in
the form of a
loan or capital contribution) in any Person.
(d) All of the issued and outstanding shares of WWT Capital
Stock
were issued in compliance in all material respects with all
applicable federal
and state securities Laws.
(e) Except as set forth in the SEC Reports, there are no
outstanding contractual obligations of WWT to repurchase, redeem
or otherwise
acquire any shares of capital stock (or options or warrants to
acquire any such
shares) or other security or equity interests of WWT. Except as
set forth in the
SEC Reports, there are no stock-appreciation rights,
security-based performance
units, phantom stock or other security rights or other
agreements, arrangements
or commitments of any character (contingent or otherwise)
pursuant to which any
Person is or may be entitled to receive any payment or other
value based on the
revenues, earnings or financial performance, stock price
performance or other
attribute of WWT or any of its Subsidiaries or to cause WWT or
any of its
Subsidiaries to file a registration statement under the
Securities Act, or which
otherwise relate to the registration of any securities of WWT or
any of its
Subsidiaries.
(f) Except as set forth in the SEC Reports, there are no
voting
trusts, proxies or other agreements, commitments or
understandings to which WWT
or any of its Subsidiaries or, to the knowledge of WWT, any of
the stockholders
of WWT, is a party or by which any of them is bound with respect
to the
issuance, holding, acquisition, voting or disposition of any
shares of capital
stock or other security or equity interest of WWT or any of its
Subsidiaries.
4.4 NON-CONTRAVENTION. Except as set forth in the SEC Reports
and
SCHEDULE 4.4 to the WWT Disclosure Schedules, the execution,
delivery and
performance of this Agreement by WWT does not and, subject to
obtaining
shareholder adoption of this Agreement, the consummation of the
Transactions
will not (a) contravene, conflict with, or result in any
violation or breach of
any provision of the Organizational Documents of WWT, (b)
contravene, conflict
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with, or result in a violation or breach of any provision of any
Law applicable
to WWT, (c) require any consent or other action by any Person
under, constitute
a breach of or default under, or cause or permit the
termination, cancellation,
acceleration or other change of any right or obligation or the
loss of any
benefit to which WWT or any of its Subsidiaries is entitled
under any provision
of any agreement or other instrument binding upon WWT or any of
its Subsidiaries
or any license, franchise, permit, certificate, approval or
other similar
authorization affecting, or relating in any way to, the assets
or business of
WWT and its Subsidiaries or (d) result in the creation or
imposition of any Lien
on any asset of WWT or any of its Subsidiaries, which in the
case of clauses (b)
or (d) above would have a Material Adverse Effect on WWT.
4.5 CONSENTS AND APPROVALS. Except as set forth in the SEC
Reports, no
consent, approval, authorization or order of, registration or
filing with, or
notice to, any Regulatory Authority or any other Person is
necessary to be
obtained, made or given by WWT in connection with the execution,
delivery and
performance by WWT of this Agreement or any applicable
Collateral Document or
for the consummation by WWT of the Transactions, except to the
extent the
failure to obtain any such consent, approval, authorization or
order or to make
any such registration or filing would not have a Material
Adverse Effect on WWT.
4.6 BOOKS AND RECORDS. WWT has made and kept books and records
and
accounts, which, in reasonable detail, accurately and fairly
reflect the
activities of WWT pertaining to its business. WWT has not, in
any manner that
pertains to, or could affect, its business, engaged in any
transaction,
maintained any bank account or used any corporate funds except
for transactions,
bank accounts and funds that have been and are reflected in the
normally
maintained books and records of WWT.
4.7 FINANCIAL STATEMENTS. Included in the SEC Reports are the
WWT
Financial Statements. The WWT Financial Statements have been
prepared from the
books and records and fairly and accurately present the
financial condition and
the results of operations, income, expenses, assets, Liabilities
(including all
reserves), changes in shareholders' equity and cash flow of WWT
as of the
respective dates of, and for the periods referred to in, such
WWT Financial
Statements, in accordance with GAAP applied on a consistent
basis throughout the
periods indicated. WWT maintains a standard system of accounting
established and
administered in accordance with GAAP.
4.8 NO UNDISCLOSED LIABILITIES. Except as set forth in the SEC
Reports
or on SCHEDULE 4.8 of the WWT Disclosure Schedules, WWT has no
Liabilities due
or to become due except (a) Liabilities that are reflected in
the WWT Financial
Statements which have not been paid or discharged since the date
of the WWT
Financial Statements, (b) Liabilities incurred in the Ordinary
Course of
Business since the date of the WWT Financial Statements (none of
which relates
to any default under any Contract, breach of warranty, tort,
infringement or
violation of any Law or arose out of any Legal Proceeding) and
none of which
would have a Material Adverse Effect on WWT, and (c) Liabilities
which are
satisfied by WWT prior to the Closing.
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4.9 TAXES.
(a) FILING OF TAX RETURNS. WWT has duly and timely filed (or
caused to be filed) with the appropriate taxing authorities all
Tax Returns
required to be filed through the date hereof. All such Tax
Returns filed are
complete and accurate in all respects. WWT is not currently the
beneficiary of
any extension of time within which to file any Tax Return. No
claim has ever
been made against WWT or its assets by an authority in a
jurisdiction where WWT
does not file Tax Returns such that WWT is or may be subject to
taxation by that
jurisdiction.
(b) PAYMENT OF TAXES. All Taxes owed and due by WWT (whether
or
not shown on any Tax Return) have been paid. The unpaid Taxes of
WWT, if any,
(i) did not, as of the date of WWT Financial Statements, exceed
the reserve for
Tax liability (excluding any reserve for deferred Taxes
established to reflect
timing differences between book and Tax income) set forth on the
face of the WWT
Financial Statements (rather than in any notes thereto), and
(ii) have not
exceeded that reserve as adjusted for operations and
transactions through the
date hereof in accordance with the past custom and practice of
WWT in filing its
Tax Returns. Since the WWT Financial Statements Date, WWT has
not (i) incurred
any Liability for Taxes other than in the Ordinary Course of
Business or (ii)
paid Taxes other than Taxes paid on a timely basis and in a
manner consistent
with past custom and practice.
(c) AUDITS, INVESTIGATIONS, DISPUTES OR CLAIMS. No
deficiencies
for Taxes are claimed, proposed or assessed by any taxing or
other governmental
authority against WWT, and there are no pending or, to the
knowledge of WWT,
threatened audits, investigations, disputes or claims or other
actions for or
relating to any Liability for Taxes with respect to WWT, and
there are no
matters under discussion by or on behalf of WWT with any
Regulatory Authority,
or known to WWT, with respect to Taxes that are likely to result
in an
additional Liability for Taxes with respect to WWT. Audits of
federal, state and
local Tax Returns by the relevant taxing authorities have been
completed for the
periods set forth on SCHEDULE 4.9(c) of the WWT Disclosure
Schedules, and,
except as set forth thereon, none of WWT, any Subsidiary
thereof, or any
predecessor thereof has been notified that any taxing authority
intends to audit
a Tax Return for any other period. WWT has not waived any
statute of limitations
in respect of Taxes or agreed to any extension of time with
respect to a Tax
assessment or deficiency. No power of attorney granted by WWT
with respect to
any Taxes is currently in force.
(d) LIEN. There are no Liens for Taxes (other than for
current
Taxes not yet due and payable) on any assets or capital stock of
WWT.
(e) TAX ELECTIONS. All material elections with respect to
Taxes
affecting WWT or any of its respective assets as of the date
hereof are set
forth on SCHEDULE 4.9(e) of the WWT Disclosure Schedules. WWT
has not: (i)
consented at any time under Section 341(f)(1) of the Code to
have the provisions
of Section 341(f)(2) of the Code apply to any disposition of any
of its assets;
(ii) agreed, and is not required, to make any adjustment under
Section 481(a) of
the Code by reason of a change in accounting method or
otherwise; (iii) made an
election, and is not required, to treat any of its assets as
owned by another
Person pursuant to the provisions of Section 168(f) of the Code
or as tax-exempt
bond financed property or tax-exempt use property within the
meaning of Section
168 of the Code; (iv) acquired, and does not own, any assets
that directly or
indirectly secure any debt the interest on which is tax exempt
under Section
103(a) of the Code; (v) made a consent dividend election under
Section 565 of
the Code; or (vi) made any of the foregoing elections and is not
required to
apply any of the foregoing rules under any comparable state or
local Tax
provision.
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(f) PRIOR AFFILIATED GROUPS. WWT is not and has never been a
member of an affiliated group of corporations within the meaning
of Section 1504
of the Code. WWT does not have any Liability for the Taxes of
any Person (i)
under Treasury Regulations Section 1.1502-6 (or any similar
provision of state,
local or foreign law), (ii) as a transferee or successor, (iii)
by Contract, or
(iv) otherwise.
(g) TAX SHARING AGREEMENTS. There are no agreements for the
sharing of Tax liabilities or similar arrangements (including
indemnity
arrangements) with respect to or involving WWT (or any of its
Subsidiaries) or
any of its assets or business, and, after the Closing Date,
neither WWT nor any
of its assets shall be bound by any such Tax-sharing agreements
or similar
arrangements or have any Liability thereunder for amounts due in
respect of
periods prior to the Closing Date.
(h) PARTNERSHIPS AND SINGLE MEMBER LLCS. WWT (i) is not subject
to
any joint venture, partnership, or other arrangement or contract
which is
treated as a partnership for Tax purposes, (ii) does not own a
single member
limited liability company which is treated as a disregarded
entity, (iii) is not
a shareholder of a "controlled foreign corporation" as defined
in Section 957 of
the Code (or any similar provision of state, local or foreign
law) and (iv) is
not a "personal holding company" as defined in Section 542 of
the Code (or any
similar provision of state, local or foreign law).
(i) NO WITHHOLDING. WWT has not been a United States real
property
holding corporation within the meaning of Section 897(c)(2) of
the Code during
the applicable period specified in Section 897 of the Code. WWT
has withheld and
paid all Taxes required to have been withheld and paid in
connection with
amounts paid or owing to any employee, independent contractor,
creditor,
shareholder or other third party. The transactions contemplated
herein are not
subject to the tax withholding provisions of Section 3406 of the
Code, or of any
other provision of law.
(j) INTERNATIONAL BOYCOTT. WWT has not participated in and is
not
participating in an international boycott within the meaning of
Section 999 of
the Code.
(k) PERMANENT ESTABLISHMENT. WWT does not have and has never had
a
permanent establishment in any foreign country, as defined in
any applicable Tax
treaty or convention between the United States and such foreign
country.
(l) PARACHUTE PAYMENTS. WWT is not a party to any existing
Contract, arrangement or plan that has resulted or would result
(upon the
Closing or otherwise), separately or in the aggregate, in the
payment of any
"excess parachute payments" within the meaning of Section 280(G)
of the Code.
(m) TAX SHELTERS. Neither WWT nor any Subsidiary has
participated
in and WWT is not now participating in, any transaction
described in Section
6111(c) or (d) of the Code or Section 6112(b) of the Code or the
Treasury
Regulations thereunder, or in any reportable transaction
described in such
regulations.
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4.10 CONTRACTS; NO DEFAULTS.
(a) The Exhibit Index to WWT's Annual Report on Form 10-K for
the
year ended December 31, 2007 sets forth a true and complete list
of all
contracts, agreements, leases, commitments or other
understandings or
arrangements, written or oral, express or implied, to which WWT
is a party, or
affecting its business or by which WWT or any of its property is
bound or
affected requiring payments to or from, or incurring of
liabilities by, WWT in
excess of $50,000 (the "WWT CONTRACTS").
(b) Except as set forth in the SEC Reports, WWT has complied
with
and performed, in all material respects, all of its obligations
required to be
performed under and is not in default with respect to any of the
WWT Contracts,
as of the date hereof, nor has any event occurred which has not
been cured
which, with or without the giving of notice, lapse of time, or
both, would
constitute a default in any respect thereunder. To the knowledge
of WWT, no
other party has failed to comply with or perform, in all
material respects, any
of its obligations required to be performed under or is in
material default with
respect to any such WWT Contracts, as of the date hereof, nor
has any event
occurred which, with or without the giving of notice, lapse of
time or both,
would constitute a material default in any respect by such party
thereunder.
(c) Except as set forth in the SEC Reports, to the knowledge
of
WWT, there exists no facts or circumstances that would make a
material default
by any party to any contract or obligation likely to occur
subsequent to the
date hereof.
4.11 EMPLOYEE BENEFITS.
(a) The SEC Reports include a complete list of all Employee
Plans
(i) covering employees, directors or consultants or former
employees, directors
or consultants in, or related to, WWT and/or (ii) with respect
to which
Surviving Corporation may incur any Liability. WWT has delivered
or made
available to Vertex true and complete copies of all Employee
Plans, including
written interpretations thereof and written descriptions thereof
which have been
distributed to WWT's employees and for which WWT has copies, all
annuity
contracts or other funding instruments relating thereto, and a
complete
description of all Employee Plans which are not in writing.
(b) Neither WWT nor any ERISA Affiliate sponsors, maintains,
contributes to or has an obligation to contribute to, or has
sponsored,
maintained, contributed to or had an obligation to contribute
to, any Pension
Plan subject to Title IV of ERISA, or any Multiemployer
Plan.
(c) Each Welfare Plan which covers or has covered employees
or
former employees of WWT or of its Affiliates in the Business and
which is a
"group health plan," as defined in Section 607(1) of ERISA, has
been operated in
compliance with provisions of Part 6 of Title I, Subtitle B of
ERISA and Section
4980B of the Code at all times.
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(d) There is no Legal Proceeding or Order outstanding, relating
to
or seeking benefits under any Employee Plan set forth in the SEC
Reports, which
is pending, threatened or anticipated against WWT, any ERISA
Affiliate or any
Employee Plan.
(e) Neither WWT nor any ERISA Affiliate has any liability
for
unpaid contributions under Section 515 of ERISA with respect to
any Welfare Plan
(i) covering employees, directors or consultants or former
employees, directors
or consultants in, or related to, WWT and (ii) with respect to
which Surviving
Corporation may incur any Liability.
(f) There are no Liens arising under the Code or ERISA with
respect to the operation, termination, restoration or funding of
any Employee
Plan set forth in the SEC Reports, or arising in connection with
any excise tax
or penalty tax with respect to such Employee Plan.
(g) Each Employee Plan set forth in the SEC Reports has at
all
times been maintained in all material respects, by its terms and
in operation,
in accordance with all applicable laws, including, without
limitation, ERISA and
the Code.
(h) WWT and its ERISA Affiliates have made full and timely
payment
of all amounts required to be contributed under the terms of
each Employee Plan
and applicable Law or required to be paid as expenses or as
Taxes under
applicable Laws, under such Employee Plan, and WWT and its ERISA
Affiliates
shall continue to do so through the Closing Date.
(i) WWT has no Employee Plan intended to qualify under Section
401
of the Code.
(j) Except as set forth on SCHEDULE 4.11(j) of the WWT
Disclosure
Schedules, neither the execution and delivery of this Agreement
or other related
agreements by WWT nor the consummation of the Transactions will
result in the
acceleration or creation of any rights of any person to benefits
under any
Employee Plan (including, without limitation, the acceleration
of the vesting or
exercisability of any stock options, the acceleration of the
vesting of any
restricted stock, the acceleration of the accrual or vesting of
any benefits
under any Pension Plan or the acceleration or creation of any
rights under any
severance, parachute or change in control agreement).
(k) Neither WWT nor any ERISA Affiliate has incurred any
liability
with respect to any Employee Plan, which may create, or result
in any liability
to Surviving Corporation.
4.12 LABOR MATTERS; EMPLOYEES. WWT is not a party to any
collective
bargaining or other labor contract. There has not been, there is
not presently
pending or existing, and, to the knowledge of WWT, there is not
threatened (i)
any strike, slowdown, picketing, work stoppage or employee
grievance process
against WWT or its business; (ii) any Legal Proceeding against
or affecting WWT
or its business relating to the alleged violation of any Law or
Order pertaining
to labor relations or employment matters; or (iii) union
organizing campaign or
any application for certification of a collective bargaining
agent. No event has
occurred or circumstance exists that could provide the basis for
any work
stoppage or other labor dispute. There is no lockout of any
employees by WWT,
and no such action is contemplated by WWT. WWT has complied with
all material
Laws relating to employment, equal employment opportunity,
nondiscrimination,
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harassment, retaliation, immigration, wages, hours, benefits,
collective
bargaining, the payment of social security and similar Taxes,
occupational
health and safety, and plant closing. WWT is not liable for the
payment of any
compensation, damages, Taxes, fines, penalties or other amounts
(including,
without limitation, amounts related to workplace safety and
insurance), however
designated, for failure to comply with any of the foregoing
Laws.
4.13 LEGAL PROCEEDINGS. There is no Legal Proceeding or Order
(a)
pending or, to the knowledge of WWT, threatened or anticipated
against or
affecting WWT, its assets or its business (or to the knowledge
of WWT, pending
or threatened, against any of the officers, directors or
employees of WWT with
respect to their business activities related to or affecting
WWT's business);
(b) that challenges or that may have the effect of preventing,
making illegal,
delaying or otherwise interfering with any of the Transactions;
or (c) related
to WWT's business or WWT's assets to which WWT is otherwise a
party. To the
knowledge of WWT, there is no reasonable basis for any such
Legal Proceeding or
Order. To the knowledge of WWT, no officer, director, agent or
employee of WWT
is subject to any Order that prohibits such officer, director,
agent or employee
from engaging in or continuing any conduct, activity, or
practice relating to
WWT's business. Except as set forth in the SEC Reports, neither
WWT, its assets
or its business is subject to any Order of any Regulatory
Authority and WWT is
not engaged in any Legal Proceeding to recover monies due it or
for damages
sustained by it. WWT is not and has not been in default with
respect to any
Order, and there are no unsatisfied judgments against WWT, its
assets or its
business. There is not a reasonable likelihood of an adverse
determination of
any pending Legal Proceedings. There are no Orders or agreements
with, or Liens
by, any Regulatory Authority or quasi-governmental entity
relating to any
environmental Law, which regulate, obligate, bind or in any way
affect WWT or
any property on which WWT operates its business.
4.14 COMPLIANCE WITH LAW.
(a) WWT, to its knowledge, and the conduct of WWT's business
are
and at all times have been in compliance with all Laws or Orders
applicable to
them or to the conduct and operations of WWT's business. WWT has
not received
any notice to the effect that, or otherwise been advised of (i)
any actual,
alleged, possible or potential violation of, or failure to
comply with, any such
Laws or Orders or (ii) any actual, alleged, possible or
potential obligation on
the part of WWT to undertake, or to bear all or any portion of
the cost of, any
remedial action of any nature. No event has occurred or
circumstance exists that
(with or without notice or lapse of time) (i) may constitute or
result in a
violation by WWT of, or a failure on the part of WWT, any such
Laws or Orders or
(ii) may give rise to any obligation on the part of WWT to
undertake, or to bear
all or any portion of the cost of, any remedial action of any
nature, except, in
either case separately or the cases together, where such
violation or failure to
comply could not reasonably be expected to have a Material
Adverse Effect on
WWT.
(b) None of WWT, or any of its directors, officers or
Representatives or to the knowledge of WWT, any employee or
other Person
affiliated with or acting for or on behalf of WWT, has, directly
or indirectly,
(i) made any contribution, bribe, rebate, payoff, influence
payment, kickback or
other payment to any Person, private or public, regardless of
form, whether in
money, property or services (A) to obtain favorable treatment in
securing
business, (B) to pay for favorable treatment for business
secured, (C) to obtain
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special concessions or for special concessions already obtained,
for or in
respect of WWT or any of its Affiliates or (D) in violation of
any Laws of the
United States (including, without limitation, the Foreign
Corrupt Practices Act
of 1977, as amended (15 U.S.C. Sections 78dd-1 et seq.)) or any
laws of any
other country having jurisdiction; or (ii) established or
maintained any fund or
asset that has not been recorded in the books and records of
WWT.
4.15 PERMITS. SCHEDULE 4.15(a) of the WWT Disclosure Schedules
sets
forth a complete list of all Permits held by WWT or used in the
conduct of its
business, and such Permits collectively constitute all of the
Permits necessary
for WWT to lawfully conduct and operate its business, as it is
presently
conducted and to permit WWT to own and use its assets in the
manner in which
they are presently owned and used. WWT is and at all times has
been in
compliance with all material Permits applicable to it or to the
conduct and
operations of WWT's business. WWT has not received any notice to
the effect
that, or otherwise been advised of (i) any actual, alleged,
possible or
potential violation of, or failure to comply with, any such
Permits or (ii) any
actual, alleged, possible or potential revocation, withdrawal,
suspension,
cancellation or termination of, or any modification to, any
Permit set forth on
or required to be set forth on SCHEDULE 4.15(a) of the WWT
Disclosure Schedules.
No event has occurred, and to WWT's knowledge no circumstance
exists, that (with
or without notice or lapse of time) (i) may constitute or result
directly or
indirectly in a violation by WWT of, or a failure on the part of
WWT to comply
with, any such Permits or (ii) result directly or indirectly in
the revocation,
withdrawal, suspension, cancellation or termination of, or any
modification to,
any Permit set forth on or required to be set forth on SCHEDULE
4.15(a) of the
WWT Disclosure Schedules. All applications for or renewals of
all Permits have
been timely filed and made and no Permit will expire or be
terminated as a
result of the consummation of the transactions contemplated by
this Agreement.
No present or former shareholder, director, officer or employee
of WWT or any
Affiliate thereof, or any other Person, owns or has any
proprietary, financial
or other interest (direct or indirect) in any Permit that WWT
owns, possesses or
uses.
4.16 ABSENCE OF CERTAIN CHANGES. Except as set forth in the
SEC
Reports, since the date of the WWT Financial Statements, there
has not been any:
(a) purchase, redemption, retirement or other acquisition by WWT
of any WWT
Capital Stock or other equity interest of WWT; (b) amendments to
the
Organizational Documents of WWT; (c) payment or increase by WWT
of any bonuses,
salaries or other compensation (including management or other
similar fees) or
entry into any employment, severance or similar Contract with
any employee
engaged in WWT's business and which the Surviving Corporation is
required to
hire after Closing, other than increases in salary to employees
made in the
Ordinary Course of Business; (d) adverse change in employee
relations which has
or is reasonably likely to have a Material Adverse Effect on
WWT's business; (e)
entry into, termination or acceleration of, or receipt of notice
of termination
by WWT of (1) any material license, distributorship, dealer,
sales
representative, joint venture, credit or similar agreement
relating to WWT's
business, or (2) any Contract or transaction involving a
Liability by or to WWT
for which the Surviving Corporation may be liable after the
Closing (other than
the Liabilities set forth in the SEC Reports, Liabilities
reflected on the WWT
Financial Statements which have not been paid or discharged
since the date of
the WWT Financial Statements, and Liabilities relating to WWT's
business
incurred in the Ordinary Course of Business since the date of
the WWT Financial
Statements); (f) mortgage, pledge or imposition of any Lien on
any assets or
property of WWT relating to WWT's business, including the sale,
lease or other
disposition of any of its Intellectual Property relating to
WWT's business; (j)
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(1) delay or failure to repay when due any obligation of WWT,
which delay or
failure could have a Material Adverse Effect on WWT, other than
such items as
have been specifically documented to WWT in writing or (2) delay
or failure to
repay when due any obligation of WWT which delay or failure
could have a
Material Adverse Effect on WWT, WWT's business or on any assets
or property of
WWT relating to WWT's business; (g) cancellation or waiver by
WWT of any claims
or rights with a value to WWT relating to its business in excess
of Fifty
Thousand Dollars ($50,000) individually or in the aggregate; (h)
licensing out
on an exclusive basis or other than in the Ordinary Course of
Business,
disposition or lapsing of any Intellectual Property or any
disclosure to any
Person of any trade secret or other confidential information
without appropriate
protections in place; (n) change in the accounting methods,
principles or
practices used by WWT; or (i) agreement, whether oral or
written, by WWT with
respect to or to do any of the foregoing other than as expressly
provided for
herein.
4.17 INSURANCE. SCHEDULE 4.17 of the WWT Disclosure Schedules
sets
forth a complete and accurate list (showing as to each policy or
binder the
carrier, policy or binder the carrier, policy number, coverage
limits,
expiration dates, annual premiums and a general description of
the type of
coverage provided) of all policies or binders of insurance of
any kind or nature
covering WWT, its business, or any employees, properties or
assets of WWT
relating to its business, including, without limitation,
policies of life,
disability, fire, theft, workers compensation, employee fidelity
and other
casualty and liability insurance. All such policies are in full
force an effect.
WWT is not in default under any of such policies or binders, and
WWT has not
failed to give any notice or to present any claim under any such
policy or
binder in a due and timely fashion.
4.18 RESTRICTIONS ON BUSINESS ACTIVITIES. Except as set forth in
the
SEC Reports, there is no agreement, judgment, injunction, order
or decree
binding upon WWT or any of its Subsidiaries which has the effect
of prohibiting
or materially impairing (a) any current or future business
practice of WWT or
any of its Subsidiaries or (b) any acquisition of any Person or
property by WWT
or any of its Subsidiaries, except in each of clauses (a) and
(b) for any such
prohibitions or impairments that would not reasonably be
expected to have a
Material Adverse Effect on WWT.
4.19 RELATED PARTY TRANSACTIONS. Except as set forth in the
SEC
Reports, none of WWT, any Affiliate thereof, holders of the
capital stock or
other ownership interest of WWT or any Affiliate or Family
Member thereof is
presently or has, since the date of the WWT Financial
Statements, borrowed any
moneys from or has any outstanding debt or other obligations to
WWT or is
presently a party to any transaction with WWT relating to WWT's
business. Except
as set forth in the SEC Reports, none of WWT, any Affiliate
thereof, or any
director, officer or key employee of any such Persons (a) owns
any direct or
indirect interest of any kind in (except for ownership of less
than 1% of any
public company, provided, that such owner's role is that solely
of a passive
investor), or controls or is a director, officer, employee or
partner of,
consultant to, lender to or borrower from, or has the right to
participate in
the profits of, any Person which is (i) a competitor, supplier,
customer,
landlord, tenant, creditor or debtor of WWT, (ii) engaged in a
business related
to WWT's business or (iii) a participant in any transaction to
which WWT is a
party, or (b) is a party to any Contract with WWT. Except as set
forth on
SCHEDULE 4.19 of the WWT Disclosure Schedules, WWT has no
Contract or
understanding with any officer, director or key employee of WWT
or any of WWT's
shareholders or any Affiliate or Family Member thereof with
respect to the
subject matter of this Agreement, the consideration payable
hereunder or any
other matter.
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4.20 BROKERS OR FINDERS. Except as set forth on SCHEDULE 4.20 of
the
WWT Disclosure Schedules, all negotiations relative to this
Agreement and the
transactions contemplated hereby have been carried out by WWT or
its Affiliates
in connection with the transactions contemplated by this
Agreement, and neither
WWT, or Affiliates has incurred any obligation to pay any
brokerage or finder's
fee or other commission in connection with the transaction
contemplated by this
Agreement.
4.21 NO OTHER AGREEMENTS. Except as set forth in the SEC
Reports, and
other than this Agreement or any agreement contemplated hereby,
neither WWT, nor
any of its stockholders, officers, directors or Affiliates has
any legal
obligation, absolute or contingent, to any other Person to sell,
assign or
transfer any capital stock of or other equity interest (other
than warrants or
options in favor of WWT's officers, directors or employees, if
any) in WWT or to
effect any merger, consolidation or other reorganization of WWT
or to enter into
any agreement with respect thereto.
4.22 DISCLOSURE. No representation or warranty of WWT in this
Agreement
or in any Collateral Document and no statement in any
certificate furnished or
to be furnished by WWT pursuant to this Agreement contained,
contains or will
contain on the date such agreement or certificate was or is
delivered, or on the
Closing Date, any untrue statement of a material fact, or
omitted, omits or will
omit on such date to state any material fact necessary in order
to make the
statements made, in light of the circumstances under which they
were made, not
misleading.
4.23 REAL PROPERTY; TITLE TO PROPERTY.
(a) WWT does not own any real property or any interest, other
than
a leasehold interest, in any real property. A description of all
real property
leased by WWT and its Subsidiaries and all subleases thereto is
included in the
SEC Reports. Except for leases and subleases set forth in the
SEC Reports, there
are no leases, subleases, licenses, occupancy agreements,
options, rights,
concessions or other agreements or arrangements, written or
oral, granting to
any Person the right to purchase, use or occupy any real
property used in
connection with WWT's business or any portion thereof or
interest in any such
real property.
(b) WWT and its Subsidiaries have good and marketable title to
all
of its properties, interests in properties and assets, real and
personal,
reflected in WWT Financial Statements or acquired after date of
the WWT
Financial Statements, or with respect to leased properties and
assets, valid
leasehold interests in, free and clear of all mortgages, liens,
pledges, charges
or encumbrances of any kind or character, except (i) Liens for
current Taxes not
yet due and payable or which are being contested by WWT in good
faith, (ii) such
imperfections of title, liens and easements as do not and will
not materially
detract from or interfere with the use of the properties subject
thereto or
affected thereby, or otherwise materially impair business
operations involving
such properties, (iii) Liens securing debt which is reflected on
WWT Financial
Statements, and (iv) any Liens described in the SEC Reports.
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4.24 CONDUCT OF BUSINESS. Except as otherwise provided herein,
WWT
shall not amend its Organizational Documents, declare dividends,
redeem or sell
stock or other securities, enter into any material or long-term
contract,
guarantee obligations of any third party, settle or discharge
any material
balance sheet receivable for less than its stated amount, pay
more on any
liability than its stated amount or enter into any other
transaction other than
in the regular course of business.
ARTICLE V
COVENANTS OF THE PARTIES
------------------------
The Parties hereby agree as follows:
5.1 COWART EMPLOYMENT AGREEMENT. As soon as practicable
following the
execution of this Agreement, but in any event prior to the
Closing Date, Agent
shall execute and enter into an employment agreement with Vertex
Nevada, in
substantially the form attached hereto as EXHIBIT D (the "COWART
EMPLOYMENT
AGREEMENT").
5.2 TERMINATION OF COWART GUARANTEES. As soon as practicable
following
the execution of this Agreement, the Parties shall use
commercially reasonable
efforts to cause the release and termination of all personal
guarantees (the
"COWART GUARANTEES") provided by Agent and his Family Members in
respect of an
aggregate of $1.6 million of Indebtedness owed by Vertex LP to
Regents Bank.
5.3 TRANSFER. The Agent shall cause the Transfer to occur prior
to the
Closing.
5.4 FAIRNESS HEARING. As soon as practicable following the
execution of
this Agreement, and in order to qualify for an exemption
pursuant to Section
3(a)(10) of the Securities Act, the Parties shall work together
to prepare an
application for submission to the California Department of
Corporations seeking
a fairness hearing regarding the issuance of the Merger
Consideration. The
Parties shall cooperate with each other in connection with any
hearing so held
pursuant to the application. In the event that the Parties are
unable to obtain
the necessary ruling from the California Department of
Corporations (or if WWT
believes, based on advice of its counsel, that such approval is
not likely to be
obtained without making material changes to the terms of the
Merger), the
Parties will work together to prepare and file with the SEC a
Registration
Statement of Vertex Nevada on Form S-4 (which shall be filed
jointly with the
Proxy Statement referred to below) to register the issuance of
the Merger
Consideration.
5.5 PROXY STATEMENT. As soon as practicable following the
execution of
this Agreement, the Parties shall work together to prepare and
file with the SEC
a proxy statement in respect of the Merger and the transactions
contemplated
hereby (the "PROXY STATEMENT"), which Proxy Statement shall be
used in respect
of soliciting approval of the Merger and this Agreement by WWT's
shareholders.
Without limiting the generality of the foregoing, Vertex LP
shall work
diligently to prepare those sections of the Proxy Statement that
relate to the
Vertex Business.
5.6 WWT OPERATIONS. As of the Effective Time, all of WWT's
assets,
Intellectual Property and Contracts shall be vested in the
Surviving
Corporation. Immediately following the Effective Time, a total
of $5.0 million
in cash shall be distributed by the Surviving Corporation to
Vertex Nevada. As
of the Closing, management of the Surviving Corporation shall
own options to
acquire up to a total of 30% of the ownership interests of the
Surviving
Corporation. In addition, effective as of the Closing, Vertex
Nevada shall enter
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into a management agreement with such members of management of
the Surviving
Corporation as shall be designated by WWT prior to the Closing
(the "WWT
MANAGEMENT"), pursuant to which Vertex Nevada will in good faith
endeavor to
execute an agreed-upon business plan (the "WWT MANAGEMENT
AGREEMENT"). The WWT
Management Agreement will provide that, in the event that the
Surviving
Corporation is unable to consummate a Qualified Financing within
180 days of the
Closing Date, any cash on hand at the Surviving Corporation
(less an amount
necessary to satisfy any of the Surviving Corporation's
Liabilities) shall be
distributed to Vertex Nevada.
5.7 REPORTING COMPANY AND SEC COMPLIANCE. The Parties hereto
acknowledge that as of the Effective Time, the Vertex Common
Stock shall be
deemed to be registered under Section 12(g) of the Exchange Act
pursuant to the
provisions of Rule 12g-3 thereunder. The Vertex Parties hereby
covenant that
Vertex Nevada shall thereafter take all action, and do all
things, necessary to
maintain compliance with any and all rules and regulations of
the Exchange Act
applicable to a Person subject to the reporting requirements
thereunder, and to
maintain the trading of the Vertex Common Stock on the OTC
Bulletin Board or on
any nationally recognized securities exchange.
5.8 DUE DILIGENCE. Each Party shall provide to the other and
their
respective Representatives such financial, operating and other
documents, data
and information relating to such Party, and their respective
businesses,
properties, assets and liabilities, as each Party, or its
representatives may
reasonably request. In addition, each Party hereby agrees to
take all action
necessary to enable their respective Representatives to review,
inspect and
audit each Party's business, properties, assets and liabilities
in connection
with such Party's due diligence investigation of the other
Parties, and discuss
them with such Party's Representatives. Notwithstanding any
investigation that
any Party may conduct of the other Parties, or their respective
businesses,
properties, assets and liabilities, each Party may fully rely on
the other
Party's warranties, covenants and indemnities set forth in this
Agreement.
5.9 CONSENTS AND APPROVALS. As soon as practicable after
execution of
this Agreement, the Parties shall use commercially reasonable
efforts to obtain
any necessary consents, approvals, authorizations or orders of,
make any
registrations or filings with or give any notices to, any
Regulatory Authority
or Person as is required to be obtained, made or given by any
Party to
consummate the transactions contemplated by this Agreement and
the Collateral
Documents.
5.10 NOTIFICATION OF ADVERSE CHANGE AND CERTAIN MATTERS. Each
Party
shall promptly notify the other Parties of any material adverse
change in the
condition (financial or otherwise) of such Party. Each Party
shall promptly
notify the other Parties of any fact, event, circumstance or
action known to it
that is reasonably likely to cause such Party to be unable to
perform any of its
covenants contained herein or any condition precedent in Article
6 not to be
satisfied, or that, if known on the date of this Agreement,
would have been
required to be disclosed to another Party pursuant to this
Agreement or the
existence or occurrence of which would cause any of such Party's
representations
or warranties under this Agreement not to be correct and/or
complete. Each Party
shall give prompt written notice to the other Parties of any
adverse development
causing a breach of any of the representations and warranties in
Articles 3 and
4 as of the date made.
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5.11 MEETING OF THE SHAREHOLDERS. Promptly after the date
hereof, and
subject to SEC review of the Proxy Statement, WWT will take all
action necessary
in accordance with its Organizational Documents to convene a
meeting of its
shareholders, or seek the written consent of its shareholders to
consider the
adoption and approval of this Agreement and approval of the
Merger to be held as
promptly as practicable (including, without limitation, approval
by each class
of WWT Capital Stock issued and outstanding as of the date
hereof). WWT will use
its commercially reasonable efforts to solicit from its
shareholders proxies in
favor of the adoption and approval of this Agreement and the
approval of the
Merger.
5.12 DISCLOSURE SCHEDULES. Each Party shall, from time to time
prior to
Closing, supplement its Disclosure Schedules attached hereto
with additional
information that, if existing or known to it on the date of
delivery to the
other Party, would have been required to be included therein.
For purposes of
determining the satisfaction of any of the conditions to the
obligations of any
Party in Article 6 hereof, the Disclosure Schedules of such
Party shall be
deemed to include only (a) the information contained therein on
the date of this
Agreement and (b) information added to such Party's Disclosure
Schedule by
written supplements delivered prior to Closing by such Party
that (i) are
accepted in writing by the receiving Party, or (ii) reflect
actions taken or
events occurring after the date hereof prior to Closing.
5.13 STATE STATUTES. The Parties and their respective Boards
of
Directors shall, if any state takeover statute or similar law is
or becomes
applicable to the Merger, this Agreement or any of the
transactions contemplated
by this Agreement, use all reasonable efforts to ensure that the
Merger and the
other transactions contemplated by this Agreement may be
consummated as promptly
as practicable on the terms contemplated by this Agreement and
otherwise to
minimize the effect of such statute or regulation on the Merger,
this Agreement
and the transactions contemplated hereby.
5.14 NO SOLICITATION. Until the earlier of the Closing or the
date of
termination of this Agreement pursuant to the provisions of
Article 8 hereof, no
Vertex Party nor any of their respective officers, directors,
agents, investment
bankers or other representatives of any of them (collectively,
the
"REPRESENTATIVES") will, directly or indirectly, (i) solicit,
engage in
discussions or negotiate with any Person (regardless of who
initiates such
discussions or negotiations), or take any other action intended
or designed to
facilitate the efforts of any Person, other than the parties
hereto, relating to
the possible acquisition of Vertex LP (whether by way of
purchase of partnership
interest, capital stock, purchase of assets or otherwise) or any
significant
portion of its interests, capital stock or assets by any Person
other than the
parties hereto (an "ALTERNATIVE Acquisition"), (ii) provide
information with
respect to Vertex LP or any Person relating to a possible
Alternative
Acquisition by any Person, (iii) enter into an agreement with
any Person
providing for a possible Alternative Acquisition, or (iv) make
or authorize any
statement, recommendation or solicitation in support of any
possible Alternative
Acquisition by any Person. Each Vertex Party shall cause its
Representatives to
immediately cease and cause to be terminated all existing
discussions or
negotiations with any Person heretofore conducted with respect
to any possible
Alternative Acquisition.
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5.15 CONDUCT OF BUSINESS. The Vertex Parties agree that during
the
period from the date of this Agreement and continuing until the
earlier of the
termination of this Agreement pursuant to the provisions of
Article 8 hereof or
the Closing, Vertex LP shall (unless otherwise required by this
Agreement or WWT
has given its prior written consent to the Vertex Parties) carry
on its business
in the ordinary course consistent with past practice, pay its
Taxes and other
obligations consistent with its past practices, pay or perform
other obligations
when due consistent with its past practices, subject to any good
faith disputes
over such Taxes and other obligations and, to the extent
consistent with such
business, use reasonable efforts and institute all policies to
preserve intact
its present business organization, keep available the services
of its present
officers and key employees, preserve its relationships with
customers,
suppliers, distributors, licensors, licensees, independent
contractors and other
Persons having business dealings with it, all with the express
purpose and
intent of preserving unimpaired its goodwill and ongoing
businesses at the
Closing.
5.16 CONFIDENTIALITY. WWT and the Vertex Parties acknowledge and
agree
that the terms and conditions described in this Agreement,
including its
existence, as well as the non-public information and data
furnished to them or
their respective Representatives from the first introduction of
the Parties and
throughout the negotiation and drafting of this Agreement is
confidential and
will not be disclosed to any third party, or used for any
purpose not
specifically contemplated herein, without prior written consent
of the other
Party, unless otherwise required by Law (including as required
by the rules and
regulations of the SEC) or unless it ceases to be confidential
through no breach
of the receiving party.
5.17 INSIDER LOCK-UPS. Prior to the Closing, WWT shall use
commercially
reasonable efforts to cause its officers, directors, and certain
founders to
agree to enter into a lock-up agreement on the same terms as the
Vertex Lock-Up.
5.18 VERTEX FINANCIAL STATEMENTS. Promptly following execution
of this
Agreement, the Vertex Parties shall prepare the Vertex Financial
Statements and
shall retain a PCAOB-certified auditing firm to audit the Vertex
Financial
Statements. The foregoing audit shall include an audit of the
operations of the
Vertex Business as a separate division of Vertex LP as of and
for the three
years ended December 31, 2007.
5.19 LOCK-UP. Each shareholder of Vertex Nevada immediately
prior to
the Closing will enter into an agreement with Vertex Nevada
pursuant to which
each such shareholder agrees that it will not sell or otherwise
transfer any of
its shares of Vertex Common Stock during the 12-month period
following the
Closing and that, prior to the three-year anniversary of the
Closing, it will
not, in any given three-month period, sell more than that number
of shares of
Vertex Common Stock as equals 5% of the total number of shares
of Vertex Common
Stock then beneficially owned by such shareholder (in each case
except for
transfers to recipients that agree to comply with the foregoing
restrictions) (a
"VERTEX LOCK-UP").
5.20 INSURANCE. Prior to the Closing, Vertex Nevada shall
procure
insurance policies in such amounts and covering such matters as
are customary
with respect to the Vertex Business.
5.21 FOREIGN QUALIFICATIONS. Prior to the Closing, Vertex Nevada
shall
be qualified as a foreign corporation to do business in
Texas.
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5.22 INDEMNIFICATION AGREEMENTS. At the Closing, Vertex Nevada
shall
assume all of WWT's obligations under the Indemnification
Agreements.
5.23 CMT AGREEMENTS. The Parties shall negotiate, in good faith,
a
ground sub-lease, a purchase and sale agreement and such other
necessary
documentation (collectively, the "CMT AGREEMENTS"), which
agreements shall
include the terms and conditions set forth on EXHIBIT E.
5.24 RELATED PARTY TRANSACTION COMMITTEE. Promptly following
the
Closing, the Agent shall cause the Board of Directors of Vertex
Nevada to create
a committee of its Board to be known as the "Related Party
Transaction
Committee". A majority of the members of this committee shall be
Independent
Directors, which shall include at least two Independent
Directors. The Agent
shall not serve on this Committee. This committee shall be
charged with the
review and pre-approval of any and all related party
transactions, including
between Vertex Nevada and Vertex LP, Ben Cowart, or any other
company or
individual which may be affiliated with Ben Cowart.
5.25 RIGHT OF FIRST REFUSAL AND RELATED RIGHTS. Effective as of
the
Closing, Vertex Nevada shall have: (a) a right of first refusal
to match any
third party offer to purchase any Cowart Party (as defined
below) on the terms
and conditions set forth in such offer (the "RIGHT OF FIRST
REFUSAL"); and (b)
the option (the "OPTION"), which can be exercised in Vertex
Nevada's sole
discretion, exercisable after the expiration of eighteen (18)
months following
the Closing (the "OPTION DATE"), to purchase all or any part
thereof of the
outstanding stock of any Cowart Party (as defined below) owned
by Vertex LP or
VTX, Inc., at a price based on an independent third-party
evaluation and
appraisal of the fair market value of such Cowart Party. The
Option shall be
exercisable at any time following the Option Date in the sole
discretion of the
majority vote of the Related Party Transaction Committee. For
the purposes of
this paragraph, a "COWART PARTY" shall be defined as one or more
of the
following: Cross Road Carriers, Vertex Recovery (or its
subsidiaries), Cedar
Marine Terminals, LP, Vert
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