EXHIBIT 10.2
TAX FREE EXCHANGE OF ASSETS FOR STOCK
TAX FREE EXCHANGE OF ASSETS FOR STOCK
("this Agreement"),
dated as of August 18, 2009 by and among My Complete Care,
Inc. ("Seller"), a
Florida corporation, and NexxNow, Inc. a New York corporation
("Buyer").
RECITALS:
WHEREAS, Seller desires to convey to Buyer, and Buyer
desires
to acquire from Seller, in accordance with the provisions of this
Agreement, all
or substantially all of the assets of
Seller with the exception of certain
assets (the "Excepted Assets") in exchange for 2,000,000
shares of the stock of
Buyer; and,
WHEREAS,
subsequent to the exchange of assets for stock, the
shareholders of the Seller will agree to dissolve the Seller, and
distribute the
stock, the Excepted Assets, and the Excepted Liabilities to
the shareholders of
the Seller in a liquidating
distribution which qualifies for a
tax free
distribution as to the stock and long term capital
gains tax treatment for the
Excepted Assets;
NOW, THEREFORE, in consideration of the
mutual covenants,
representations, warranties and agreements herein contained,
the parties hereto
agree as follows:
ARTICLE I
EXCHANGE OF ASSETS FOR STOCK
SECTION 1.1 ASSETS TO BE EXCHANGED. On the terms and
subject
to the conditions of this
Agreement including, without
limitation, the
provisions of Sections 4.10 and 4.11, on the Closing
Date, Seller shall sell,
assign, transfer, convey and deliver to Buyer,
and Buyer shall acquire from
Seller, all of Seller's right, title and interest in and to the
following assets
of Seller free and clear of all Liens, except Permitted Liens
(all such assets,
other than the Excluded Assets, being the "Assets"):
(a) All brands, trade names, trademarks,
service marks and
pending applications,( being the "Brands"), and all
logos and trade dress, and
any right to recover for infringement including past
infringement;
(b) the goodwill relating to the Brands;
(c)
All patents listed (the "Patents"),
and any right to
recover for infringement including past infringement;
(d) all research and marketing studies owned by Seller
which
are associated with the Brands and with Seller's product
development efforts as
related to the Brands;
(e) all formula specifications, trade
secrets, technical
information, manuals, material
specifications, quality assurance and control
procedures, material and safety procedure specifications, and
documentation, in
each case for all products sold or which Seller plans
to sell under the Brands
(such products, the "Products"), includingbany
improvements or line extensions
of the Products, or which are in research and
development for sale under the
<PAGE>
Brands, and any patent applications relating thereto,
and any right to recover
for infringement including past infringement;
(f) all rights of Seller to
television, radio and print
advertisements and copy (including all physical embodiments
thereof) associated
with the Brands and Products;
(g) all rights of Seller in and to
copyrights associated
primarily with the Brands, distribution,
production, and advertising sales
services (the "Services") offered by the Seller
and any right to recover for
infringement including past infringement;
(h) all rights of Seller (including
rights of refund and
offset, deposits, rights to sums of money
due, claims, causes of action and
options) relating or pertaining to any contract or contract
right;
(i) all customer lists, supplier lists, accounts,
invoices,
credit records and performance records
associated with the Products or the
Services, described more particularly;
(j) those accounts receivable of Seller and other
rights of
Seller to payment for the Products and Services), including,
without limitation,
rights to payment that are not evidenced by
instruments, whether or not they
have been written off or reserved against as a bad debt or
doubtful account in
any financial statement, together with all instruments
representing any of the
foregoing, and all rights, title, security
and guaranties in favor of Seller
with respect to any of the foregoing (the "Accounts");
(k) all Permits used by Seller in connection with the Products
and Services;
(l) all insurance proceeds and
insurance claims of Seller
relating or pertaining to the Assets
and, to the extent transferable, the
benefit of and the right to enforce the covenants and
warranties, if any, that
Seller is entitled to enforce with
respect to all or any part of the Assets
against Seller's predecessors in title to the Assetsl
(m) all tax refunds, credits and/or proceeds thereof; and
(n) trade secrets, know-how, proprietary
information, and
other intellectual property used and useful in
television broadcasting in all
forms and in all media, whether now known or hereinafter
discovered.
SECTION 1.2 ASSUMPTION OF
LIABILITIES. On the terms and
subject to the conditions set forth in this Agreement, Buyer
shall assume, and
agree to pay, perform and discharge when due:
(a) all of the debts, liabilities and obligations of Seller to
third parties under the Scheduled Contracts that are
specifically set forth on
Schedule 1.3 hereto and that are not due prior to Closing, or
if no contractual
due date is provided for, are not more than ten (10)
days past invoice date at
Closing;
(b) all of the other debts listed on Schedule
1.4 attached
hereto.
(The liabilities listed in clauses (a) and (b) of this Section
1.3 are collectively, the Assumed Liabilities").
<PAGE>
SAVE AND EXCEPT, all of the Excepted Assets, described as
the
assets directly or indirectly connected to or with
contract rights, thereof,
including, but not limited to, accounts,
deposits, contract rights, and/or
proceeds therefrom.
SECTION 1.3
EXCLUDED LIABILITIES. Seller's shareholders shall
retain,
and be responsible for paying, performing and
discharging when due, and Buyer
shall not assume or have any responsibility for:
(a) any federal, state or local franchise,
income or other
taxes or fees of any nature whatsoever
attributable to the Assets for periods
ending on or prior to the Closing and any penalty (or similar
amount) thereon;
(b) any and all products liability lawsuits commenced by third
parties or other products liability claims
relating to any of the Products
manufactured prior to Closing, other than Products
that constitute Inventory
under Section 1.1(j) and all products liability claims
listed on Schedule 2.10
with respect to the Products (such
lawsuits and claims, collectively, the
"Products Liability Claims");
(c) any accounts due and payable to
third parties by Seller as
of the Closing Date whether or not arising from
or primarily related to the
operations of the Assets and including amounts
due to third parties as of the
Closing Date under the Scheduled Contracts;
(d) Any obligation or liability of Seller arising out
of the
Assumed Liabilities, which are payable or performable prior to
Closing; and
(e) any other liability of Seller
other than the Assumed
Liabilities.
SECTION 1.4 PURCHASE PRICE. The
aggregate purchase price
payable by Buyer shall be two million (2,000,000
shares) of restricted common
voting stock of the Buyer, non-assessable,
and free and clear of any liens,
claims, or encumbrances (the "Purchase Price"). On the
Closing Date, Buyer will
pay the Purchase Price.
SECTION 1.5 ALLOCATION OF PURCHASE PRICE. The purchase
price
shall be allocated based on the requirements of
compliance with the Internal
Revenue Code.
SECTION 1.6 PRORATION OF TAXES. With respect to any ad valorem
tax imposed on a periodic basis that relates to a period
straddling the Closing
Date, such tax shall be prorated to the Closing Date, and the
portion allocable
to the period prior to the Closing Date shall be promptly
paid or reimbursed by
Seller, and the portion allocable to the period after the
Closing Date shall be
promptly paid or reimbursed by Buyer.
SECTION 1.7 PURCHASE PRICE ADJUSTMENT. NOT REQUIRED.
<PAGE>
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF SELLER
Seller, jointly and severally, represents
and warrants to
Buyer as follows:
SECTION
2.1 ORGANIZATION AND QUALIFICATION.
Seller is a
corporation duly organized, validly existing and in good standing
under the laws
of the State of Florida, with all requisite
corporate power and authority to
own, operate and lease its properties and to carry on its
business as presently
conducted.
SECTION 2.2 AUTHORIZATION. Seller has full corporate power and
authority to execute and deliver
this Agreement and to
consummate the
transactions contemplated hereby. The execution and
delivery of this Agreement
by Seller, the performance by Seller of its
obligations hereunder, and the
consummation by Seller of the transactions contemplated
hereby, have been duly
authorized by the Board of Directors
and stockholder of Seller. No other
corporate action on the part of Seller is necessary to
authorize the execution
and delivery of this Agreement
or the consummation of the
transactions
contemplated hereby. This Agreement has
been duly and validly executed and
delivered by Seller and constitutes a valid and
binding obligation of Seller,
enforceable against it in accordance with
its terms, subject to applicable
bankruptcy, insolvency, reorganization,
moratorium and similar laws affecting
creditors' rights and remedies generally, and subject, as to
enforceability, to
general principles of equity, including principles of commercial
reasonableness,
good faith and fair dealing (regardless of
whether enforcement is sought in a
proceeding at law or in equity).
SECTION 2.3 NO VIOLATION. The execution and delivery of
this
Agreement by Seller, the performance by Seller of
its respective obligations
hereunder, and the consummation by Seller
of the transactions contemplated
hereby do not (a) violate, conflict
with or result in any breach of any
provision of the Certificate of Incorporation or Bylaws of
Seller, (b) violate,
conflict with or result in a violation or breach of,
or constitute a default
(with or without due notice or
lapse of time or both) under the terms,
conditions or provisions of any note,
bond, mortgage, indenture, license,
agreement or other instrument or obligation
to which Seller is a party or by
which it or any of its assets is
bound, (c) violate any statute,
rule,
regulation, order, writ, judgment,
injunction or decree of any court
or
Governmental Authority by which the Seller or its
assets are bound, or (d)
result in the creation of any Lien upon the
properties or assets of Seller,
except, in the case of clauses (b), (c) and (d), for such
violations, breaches
or defaults as are not, individually or in the
aggregate, reasonably likely to
have a Material Adverse Effect.
SECTION 2.4 GOVERNMENT CONSENTS AND APPROVALS. No
filing or
registration with, no notice to and
no permit, authorization, consent or
approval of any Person or
Governmental Authority is necessary
for the
consummation by Seller of the transactions contemplated by
this Agreement other
than (a) consents and approvals of
or filings or registrations with the
Antitrust Division of the United States
Department of Justice (the "DOJ")
pursuant to the Hart-Scott-Rodino Antitrust Improvements Act of
1976, as amended
(the "HSR Act"), if required (b) those
already obtained and (c) consents,
regulations, approvals, authorizations, permits, filings or
notifications which
are listed in Schedule 2.4 hereto.
SECTION 2.5 TITLE TO ASSETS. (a) Seller owns
and has valid
title to each of the Assets, free and clear
of all Liens other than Permitted Liens, except
for the Assets described in
Schedule 2.5, as to which Seller [either (i) owns
and has valid title to such
property, free and clear of all Liens other than Liens set forth on
Schedule 2.5
that shall be released at Closing and Permitted
Liens, or (ii)] has adequate,
enforceable and transferable long-term licenses or other
rights to use (without
payment) certain Intellectual Property.
(b) On the Closing Date, each
of the Assets shall be
operational and all Liens set forth on Schedule 2.5 shall have been
released.
<PAGE>
SECTION 2.6 INTELLECTUAL PROPERTY.
Except as set forth in
Schedule 2.6 the Seller owns or, if
expressly stated on Schedule 2.6, has
validly licensed, all patents, patent
rights, trademarks, trademark rights,
trade names, trade name rights, service marks, service mark
rights, copyrights
and other proprietary intellectual property rights
(collectively, "Intellectual
Property"), which are part of the Assets. Except as set
forth Schedule 2.6, no
Claims are pending or, to the knowledge of
the Seller, threatened that the
Seller or any third party is infringing or
otherwise adversely affecting the
rights of any person with regard to the Intellectual
Property. To the knowledge
of the Seller, no person is infringing the rights of the
Seller with respect to
any of the Intellectual Property.
SECTION 2.7 FINANCIAL STATEMENTS. Schedule 2.6 sets forth
the
un-audited pro-forma statements of earnings before
taxes of the Assets for the
year ended December 31, 2008 and for the nine months
ended September 30, 2009
(such statements, including the
related notes thereto, the
"Financial
Statements"). The Financial Statements are complete and
correct in all material
respects and present fairly the results of
operations of the Assets for the
periods indicated.
SECTION 2.8 TAXES. All Taxes that are due
and payable by
Seller, other than those presently payable
without penalty or interest, have
been timely paid, and Seller has timely
filed (and, through and after the
Closing Date, will timely file) all Tax reports and
returns required by law to
be filed by it. There are no Tax liens upon any
properties or assets of Seller
nor has notice been given of any event which could lead
to any such lien. All
monies required for the payment of Taxes not yet due and payable
with respect to
the operations of Seller through and
including the Closing Date have been
approved, reserved against and entered upon the books
and the Seller Financial
Statements. All monies required to be withheld by Seller from
employees, if any,
independent contractors, or others or collected from customers for
income taxes,
social security and unemployment
insurance taxes and sales, excise and use
taxes, and the portion of any such taxes to be paid by
Seller to governmental
agencies or set aside in accounts for such purpose have been
approved, reserved
against and entered upon the
books and the Seller Financial
Statements.
Consummation of the transactions will not result in any
tax obligations on the
Assets, except as set forth in Schedule 2.8.
SECTION 2.9 SCHEDULED CONTRACTS. (a) The Scheduled
Contracts:
(i) do not require payment by any party thereto of more than
$10,000; (ii) are
terminable by Seller upon ninety (90)
days' notice or less and without the
payment of any material penalty or material termination fee; and
(iii) have been
entered into in the ordinary course of business.
(b) Schedule 2.9(c) hereto sets forth a true and correct
list
of all contracts of Seller that are
material to the Assets (the "Scheduled
Contracts"). Buyer has been provided
with true and correct copies of all
Scheduled Contracts(or in the case
of oral agreements, complete written
descriptions), and each such Scheduled
Contract is in full force and effect
constitute legal, valid and binding
obligations of the respective parties
thereto and are enforceable in accordance with their
respective terms. Seller
has not committed any breach or default thereunder, nor to
Seller's or Parent's
knowledge has any third party to such contracts committed any
breach or default
thereunder, in each case, which is reasonably likely to have
a Material Adverse
Effect. All such Scheduled Contracts are in
the name of Seller and will be
validly assigned to Buyer at the time of the Closing.
(c) As used in this Section 2.9, the word "contract" means and
includes every written agreement of any kind which is legally
enforceable by or
against Seller.
<PAGE>
SECTION 2.10 LITIGATION. (a) Schedule 2.10 sets forth a list
of all lawsuits or
claims pending, or which, to Seller's or Parent's
knowledge, are threatened,
against Seller relating to or affecting any of the Assets and
which:
(i) involve a Products Liability Claim;
(ii) involve a claim (other than a Products Liability
Claim)
against Seller of, or which involve an
unspecified amount which is reasonably
likely to result in a liability of, more than $100,000;
(iii) seek injunctive relief, or
(iv) seek any legal restraint on or prohibition
against the
transactions contemplated by this Agreement.
(b) The Seller is not a party or subject to any judgment,
order, injunction or
decree of any Governmental Authority.
SECTION 2.11 Permits. (a) Seller has all franchises, permits,
licenses, waivers,
authorizations and approvals
("Permits") from Governmental
Authorities,
including environmental Permits, which are required for
Seller to own, sell and
operate the Assets.
(b) There are no material defects in the Permits pertaining to
the ownership, sale or operation of the Assets, and no
procedure is pending or,
to Seller's or Parent's knowledge,
threatened to revoke or limit any such
Permit.
(c) Following the Closing Date, neither Seller nor Parent will
undertake, directly or indirectly, any challenges to the Permits
relating to the
ownership, sale or operation of the Assets.
SECTION 2.12 COMPLIANCE WITH LAWS. The Assets are
owned and
operated by Seller in compliance with all
applicable Laws, and neither Seller
nor Parent has received any written notice
of violation of any Law from any
Governmental Authority relating to any of
the Assets or the ownership or
operation thereof.
SECTION 2.13 EMPLOYEES. (a) Schedule 2.13(a) sets forth a list
of all employees of Seller whose
primary responsibility is the research,
development, marketing, promotion, production,
operation, distribution or sale
of the Products or provision of the Services (the "Designated
Employees").
(b) None of the Designated Employees are
represented by any
labor organization.
(c) Except as set forth in Schedule
2.13(c), there are no
pending or threatened labor
organizing activities, election petitions
or
proceedings, unfair labor practice
complaints, slowdowns, or work stoppages
known to Seller, involving any Designated Employee.
(d) Seller has complied with all laws, rules and
regulations
which relate to wages, hours, discrimination
and employment and collective
bargaining, and is not liable for any arrears of wages or any taxes
or penalties
for failure to so comply with any of the
foregoing in connection with its
employment of the Designated Employees.
SECTION 2.14 EMPLOYEE BENEFIT PLANS. Schedule 2.14 sets
forth
a true and complete list of each "employee benefit plan"
(within the meaning of
Section 3(3) of the Employee Retirement Income Security Act
of 1974, as amended
<PAGE>
("ERISA")), each written employment,
severance, retention, termination,
consulting or retirement
contract, and each bonus or
other incentive
compensation, stock purchase, stock option, stock
award or other equity-based
compensation (other than any governmental
program) maintained by Seller with
respect to the Designated Employees
(collectively, "Employee Benefit Plans").
True, correct and complete copies of the Employee Benefit
Plans or summary plan
descriptions of such Employee Benefit Plans
have been provided to Buyer by
Seller. All employee benefits required to be paid to
the Designated Employees
under any Employee Benefit Plans are fully funded
and in material compliance
with applicable Law.
SECTION 2.15 INVENTORY. NOT APPLICABLE
SECTION 2.16 CUSTOMERS AND SUPPLIERS. Schedule 2.16 sets forth
a list of names and addresses of all customers and all
suppliers accounting for
$10,000 or more of Seller's sales or purchases
during the 2009 fiscal year.
There exists no actual termination or cancellation of the
business relationship
of Seller with any customer or group of customers or with any
supplier or group
of suppliers listed in Schedule 2.16, with respect to which
Seller has received
written notice of termination or cancellation as
the case maybe. To Seller's
knowledge, no such termination or cancellation has been
threatened.
SECTION 2.17 BROKERS' FEES AND COMMISSIONS. NOT APPLICABLE.
SECTION 2.18 ENVIRONMENTAL MATTERS. Except
as set forth in
Schedule 2.18 hereto, no notice, citation, summons or order
has been issued, no
complaint has been filed, no penalty has been assessed and no
investigation or
review is pending or threatened by any Governmental
Authority with respect to
(i) any alleged violation, in
the conduct of Seller's business, of
any
environmental statute, ordinance, rule, regulation or order
of any Governmental
Authority; (ii) any alleged
failure to have any
environmental permit,
certificate, license, approval,
registration or authorization required
in
connection with the conduct of Seller's business;
or, (iii) any generation,
treatment, storage, recycling, transportation or
disposal of any hazardous or
toxic substance or waste
(including petroleum products
and radioactive
materials) generated or used in
connection with the conduct of
Seller's
business. To the knowledge of Seller,
Seller has complied with and is in
compliance with all Environmental
Requirements. To the knowledge of Seller,
Seller has not stored, disposed of, arranged for or
permitted the disposal of,
transported, handled or released any substance,
including, without limitation,
any hazardous substance, pollutant, contaminant or
waste, or owned or operated
any facility or property, so as to give rise to liabilities
of Seller pursuant
to the Environmental Requirements, including, without
limitation, any liability
of response costs, corrective action,
natural resources damages, personal
injury, property damage or attorneys fees. To the
knowledge of Seller, Seller
has taken no action relating to the past or present
facilities, properties or
operations of Seller that will prevent, hinder or
limit continued compliance
with the Environmental Requirements, give rise to any
investigatory, remedial or
corrective obligations pursuant to the Environmental
Requirements, or give rise
to any other liabilities pursuant to the Environmental
Requirements, including
any Environmental Requirements relating to
onsite or offsite releases or
threatened releases of hazardous or otherwise regulated materials,
substances or
wastes, personal injury, property damages or natural
resources damage. Seller
has not, either expressly or by operation of law,
assumed or undertaken any
liability or corrective or remedial obligations of any other
person relating to
Environmental Requirements.
SECTION 2.19 ACCOUNTS. Schedule
2.19 hereto contains a
complete and accurate list of all
Seller's Accounts as of the date hereof,
showing the name of each account debtor and the amount due
from each by invoice
number and date. All of such Accounts have arisen
in the ordinary course of
business for goods sold or services rendered
consistent with past practices.
Except as set forth on Schedule 2.19 hereto, to the knowledge of
Seller there is
<PAGE>
no event or condition with respect to a specific
customer that will cause such
Accounts to not be collected in full in due course without
resort to litigation
and such Accounts will not be subject to counterclaim or
setoff.
SECTION 2.20 INSURANCE. All the insurance policies
maintained
by Seller that relate or pertain to the Assets are in full force
and effect, all
insurance premiums have been timely paid to
date, and no such policy will be
cancelled by Seller prior to Closing. A description of
each of such insurance
policies (including, without limitation,
insurance providing benefits for
employees) is attached to Schedule 2.20 hereto. Such
insurance policies provide
adequate coverage, less deductibles, against the risks
involved in the business
and operation of the Assets.
SECTION 2.21 CHANGES SINCE DECEMBER 31, 2008 COMPANY FINANCIAL
STATEMENTS. Except as listed or described
on Schedule 2.21 hereto, since
December 31, 2008 there has not been: (a) any
Material Adverse Effect in the
financial condition, results of operations, business,
business organization or
personnel of Seller, or in the relationships of Seller with
vendors, suppliers,
advertisers, customers, or others; (b) any controversy
or unsettled grievance
pending or threatened between Seller and any employee of
Seller or a collective
bargaining organization representing or seeking to represent
any such employee,
or any negotiation or execution by Seller of any collective
bargaining agreement
with respect to its employees; (c) any
material amendment of any Scheduled
Contract; or (d) any agreement by, or
commitment of, Seller to do any of the
foregoing.
SECTION 2.22 INTERNATIONAL
SALES. Schedule 2.22 hereto
contains a complete and accurate list of all companies,
entities, businesses,
whether subsidiaries of Seller or otherwise, that are
currently involved in the
selling of Assets outside of the United States.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer
hereby represents and warrants to Seller as follows:
SECTION 3.1 ORGANIZATION AND
QUALIFICATION. Buyer is a
corporation duly organized, validly existing and in good standing
under the laws
of the jurisdiction of its incorporation, with all requisite
corporate power and
authority to own, lease and
operate its properties and to carry
on its
businesses as now being conducted.
SECTION 3.2 Authorization. Buyer has full corporate power
and
authority to execute and deliver
this Agreement and to
consummate the
transactions contemplated hereby. No other corporate
proceeding on the part of
Buyer is necessary to authorize the execution and delivery of
this Agreement or
to consummate the transactions contemplated hereby. This Agreement
has been duly
and validly executed and delivered by Buyer and constitutes a
valid and binding
obligation of Buyer, enforceable against it
in accordance with its terms,
subject to applicable bankruptcy, insolvency,
reorganization, moratorium and
similar laws affecting creditors' rights and remedies generally,
and subject, as
to enforceability, to general principles of
equity, including principles of
commercial reasonableness, good faith and fair
dealing (regardless of whether
enf
