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ACQUISITION OF NUCLEAR MATERIAL DETECTION TECHNOLOGIES, INC.
by
CARGO CONNECTION LOGISTICS HOLDING INC.
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AGREEMENT AND PLAN OF ACQUISITION
This
Agreement and Plan of Acquisition (Agreement) is entered into by
and
between Nuclear Material Detection Technologies, Inc., a Florida corporation,
(NMDT), UTEK CORPORATION, a Delaware corporation,
(UTEK), and Cargo
Connection
Logistics Holding Inc., a Florida corporation, (CRGO)
WHEREAS,
UTEK owns 100% of the
issued and
outstanding
shares of common
stock of NMDT (NMDT Shares); and
WHEREAS,
before the Closing
Date, NMDT will acquire the license for
the
fields of use as described in the License Agreement as described
and which are
attached hereto as part of Exhibit A and made a part of this
Agreement (License
Agreement) and the rights to develop and market a proprietary
technology for the
fields of uses specified in the License Agreement (Technology).
WHEREAS,
the parties desire to
provide for the terms and conditions upon
which NMDT will be acquired by CRGO in a stock-for-stock
exchange
(Acquisition)
in accordance
with the respective corporation laws of their state, upon
consummation of which
all NMDT Shares will be owned by CRGO, and all issued and
outstanding NMDT
Shares will be
exchanged for common
stock of CRGO with terms
and conditions as set forth more fully in this Agreement; and
WHEREAS,
for federal income tax purposes, it is intended that the
Acquisition qualifies
within the meaning of Section 368 (a)(1)(B) of the
Internal Revenue Code of 1986, as amended (Code).
NOW,
THEREFORE,
in consideration of the premises and
for other good and
valuable
consideration, the
receipt, adequacy and
sufficiency of which are by
this Agreement acknowledged, the parties agree as follows:
ARTICLE 1
THE STOCK-FOR-STOCK ACQUISITION
1.01 The
Acquisition
(a) Acquisition
Agreement.
Subject to the terms
and conditions of
this Agreement, at the
Effective Date, as defined below, all NMDT Shares shall
be acquired from UTEK by CRGO in accordance with the respective
corporation laws
of their state and the provisions of this Agreement and the separate
corporate
existence of NMDT, as a wholly-owned subsidiary of CRGO, shall continue after
the closing.
(b) Effective
Date.
The Acquisition shall become effective
(Effective Date)
upon the execution of this Agreement and closing of the
transaction.
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<PAGE>
1.02
Exchange of Stock. At the Effective Date, by virtue of the
Acquisition, all of
the NMDT Shares
that are issued and outstanding at the
Effective Date shall be exchanged for the issuance of 168,539,326 unregistered
shares of common stock of CRGO to UTEK.
1.03
Effect of Acquisition.
(a) Rights in NMDT Cease. At and after the Effective Date, UTEK,
the
sole shareholder of each certificate of common stock of NMDT shall
cease to have
any rights as a shareholder of NMDT.
(b) Closure of NMDT
Shares Records.
From and after the
Effective
Date, the stock
transfer books of NMDT
shall be closed, and
there shall be no
further registration of stock transfers on the records of NMDT.
1.04
Closing. Subject to
the terms and conditions of this Agreement, the
Closing of the Acquisition shall take place December 6, 2006.
ARTICLE 2
REPRESENTATIONS AND WARRANTIES
2.01
Representations
and Warranties of UTEK and NMDT. UTEK and NMDT
represent and
warrant to CRGO that the facts set forth below are true and
correct:
(a) Organization.
NMDT and UTEK are
corporations
duly organized,
validly existing and in good standing under the laws of their
respective states
of incorporation,
and they have the
requisite power and authority to conduct
their business and consummate the transactions contemplated by this
Agreement.
True, correct and
complete copies of the articles of incorporation, bylaws and
all corporate minutes
of NMDT have been provided to CRGO and such documents are
presently in effect and have not been amended or modified.
(b)
Authorization.
The execution
of this Agreement and the
consummation of the Acquisition and the other transactions
contemplated by
this
Agreement have been duly authorized by the board of
directors and
shareholders
of NMDT and the board of directors of UTEK; no other corporate action by the
respective parties is
necessary in order to execute, deliver, consummate and
perform their
respective
obligations
hereunder;
and NMDT and UTEK
have all
requisite corporate
and other authority to
execute and deliver this Agreement
and consummate the transactions contemplated by this Agreement.
(c) Capitalization.
The authorized capital of NMDT consists of
1,000,000 shares of common stock with a par value $.01 per share.
At the date of
this Agreement, 1,000 NMDT Shares are issued and outstanding.
All issued and outstanding NMDT Shares have been duly and validly
issued and are
fully paid and
non-assessable shares
and have not been issued in violation of
any preemptive or other rights of any other person or any
applicable laws.
NMDT
is not authorized
to issue any preferred
stock. All dividends on NMDT Shares
which have been declared prior to the date of this
Agreement have been
paid in
full. There are no outstanding options, warrants, commitments, calls or other
rights or agreements requiring NMDT to issue any NMDT
Shares or securities
convertible into NMDT
Shares to anyone for any reason whatsoever. None of the
NMDT Shares is subject to any change, claim, condition,
interest, lien,
pledge,
option, security
interest or other
encumbrance or
restriction, including
any
restriction on use, voting, transfer, receipt of income or exercise
of any other
attribute of ownership.
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46
<PAGE>
(d) Binding
Effect. The execution, delivery, performance and
consummation of
this Agreement, the Acquisition and the transactions
contemplated by this
Agreement will not violate any obligation to which NMDT or
UTEK is a party and will not create a default under any such
obligation or under
any agreement to which
NMDT or UTEK is a party. This Agreement constitutes a
legal, valid and binding obligation of NMDT, enforceable in accordance with
its
terms, except as the
enforcement
may be limited by bankruptcy, insolvency,
moratorium, or similar
laws affecting
creditor's rights
generally and by
the
availability of
injunctive relief,
specific performance or other equitable
remedies.
(e) Litigation
Relating to this Agreement. There are no suits,
actions or proceedings
pending or, to the best of NMDT and UTEK's
knowledge,
information and belief, threatened, which seek to enjoin the
Acquisition or the
transactions
contemplated by this
Agreement or which,
if adversely
decided,
would have a materially adverse effect on the business,
results of
operations,
assets or prospects of NMDT.
(f) No Conflicting Agreements. Neither the execution and delivery
of
this Agreement
nor the fulfillment of or compliance by NMDT or UTEK
with the
terms or provisions
of this Agreement nor all other documents or agreements
contemplated by
this Agreement and the consummation of the transaction
contemplated by this Agreement will result in a breach of the
terms, conditions
or provisions of, or
constitute a default
under, or result in a
violation of,
NMDT or UTEK's articles of incorporation or bylaws, the Technology,
the License
Agreement, or any agreement, contract, instrument, order,
judgment or decree to
which NMDT
or UTEK is a party or by which NMDT or UTEK or any of their
respective assets is bound, or violate any provision of any
applicable law, rule
or regulation
or any order, decree, writ or injunction of any court or
government
entity which
materially
affects
their respective assets or
businesses.
(g) Consents. No consent from or approval of any court,
governmental
entity or any other
person is necessary in connection with execution and
delivery of this Agreement by NMDT and UTEK or performance of the
obligations of
NMDT and UTEK hereunder or under any other agreement to which NMDT or UTEK is
a
party; and the
consummation of the transactions contemplated by this Agreement
will not require
the approval of any entity or person
in order to prevent the
termination of the
Technology,
the License
Agreement,
or any other
material
right, privilege,
license or agreement relating to NMDT or its assets or
business.
(h) Title to
Assets. NMDT has or has agreed to enter into the
agreements as listed
on Exhibit A attached
hereto. These
agreements
and the
assets shown on the balance sheet of attached Exhibit B are the sole assets
of
NMDT. NMDT has or will
by Closing Date have
good and marketable
title to its
assets, free and
clear of all
liens, claims, charges, mortgages, options,
security agreements and other encumbrances of every kind or nature
whatsoever.
(i) Intellectual Property
(1) The Washington
Savannah River Company (WSRC) owns the
Technology and has all right, power, authority and ownership and
entitlement to
file, prosecute and
maintain in effect the Patent application with respect to
the Inventions listed in Exhibit A hereto.
(2) The License
Agreement between WSRC
and NMDT covering the
Inventions will be legal, valid, binding and will be enforceable in
accordance
with its terms as contained in Exhibit A.
(3) Except as
otherwise set forth in this Agreement, CRGO
acknowledges and
understands
that NMDT and UTEK
make no
representations
and
provide no
assurances
that the rights to the Technology and Intellectual
Property contained in
the License Agreement do not, and will not in the future,
infringe or otherwise violate the rights of third parties, and
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(4) Except as otherwise expressly set forth in this Agreement,
NMDT and UTEK make no
representations and
extend no warranties of any kind,
either express
or implied, including, but not limited to warranties of
merchantability, fitness for a particular purpose, non-infringement
and validity
of the Intellectual Property.
(j) Liabilities
of NMDT. NMDT has no assets, no liabilities or
obligations of any
kind, character or
description
except those listed on
the
attached schedules and exhibits.
(k) Financial Statements. The unaudited financial statements of
NMDT, including a
balance sheet,
attached as Exhibit B and made a part of this
Agreement, are, in all respects, complete and correct and present
fairly NMDT's
financial position and
the results of its
operations on the
dates and for the
periods shown in this
Agreement;
provided, however, that interim financial
statements are subject to customary year-end adjustments and accruals that,
in
the aggregate, will
not have a material adverse effect on the overall financial
condition or results of its operations. NMDT has not engaged in any
business not
reflected in its
financial statements. There have been no material adverse
changes in the nature
of its business,
prospects,
the value of assets or
the
financial condition
since the date of its financial statements. There are no,
and on the Closing Date there will be no, outstanding obligations
or liabilities
of NMDT except as
specifically set forth
in the financial
statements and the
other attached schedules and exhibits. There is no information known to
NMDT or
UTEK that would prevent the financial statements of NMDT from being
audited in
accordance with generally accepted accounting principles.
(l) Taxes.
All returns, reports, statements and other similar
filings required to be filed by NMDT with respect to any federal,
state, local
or foreign taxes,
assessments,
interests, penalties,
deficiencies,
fees and
other governmental
charges or impositions have been timely filed with the
appropriate governmental agencies in all jurisdictions in which
such tax returns
and other related filings are required to be filed; all such tax returns
properly reflect all liabilities of NMDT for taxes for the periods,
property or
events covered by this
Agreement;
and all taxes,
whether or not
reflected on
those tax returns,
and all taxes claimed to be due from NMDT by any
taxing
authority, have been
properly paid,
except to the extent
reflected on
NMDT's
financial statements,
where NMDT has
contested in good faith by appropriate
proceedings and
reserves have been
established on its financial statements to
the full extent if the
contest is adversely
decided against it. NMDT has not
received any notice of assessment or proposed assessment in connection with
any
tax returns, nor is NMDT a party to or to the best of its
knowledge, expected to
become a party to any pending or threatened action or proceeding,
assessment or
collection of taxes.
NMDT has not
extended or waived the
application
of any
statute of
limitations
of any jurisdiction regarding the assessment or
collection of any
taxes. There are no tax liens
(other than any lien which
arises by operation of law for current taxes not yet due and payable) on
any of
its assets. There is no basis for any additional assessment of taxes, interest
or penalties. NMDT has made all deposits required by law to be made
with respect
to employees'
withholding
and other employment taxes, including without
limitation the portion
of such deposits
relating to taxes
imposed upon NMDT.
NMDT is not and has never been a party to any tax sharing agreements with any
other person or entity.
(m) Absence of Certain Changes or Events. From the date of the full
execution of the Term
Sheet until the Closing Date, NMDT has not, and without
the written consent of CRGO, it will not have:
(1) Sold, encumbered,
assigned let lapsed or
transferred any
of its material assets, including without limitation the
Intellectual Property,
the License Agreement or any other material asset;
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<PAGE>
(2) Amended or
terminated
the License Agreement or other
material agreement
or done any act or
omitted to do any act which would cause
the breach of the License Agreement or any other material
agreement;
(3) Suffered any damage, destruction or loss whether or not in
control of NMDT;
(4) Made any commitments or agreements for capital
expenditures or otherwise;
(5) Entered into any
transaction or made
any commitment not
disclosed to CRGO;
(6) Incurred any
material obligation or liability for borrowed
money;
(7) Suffered
any other event of any character, which is
reasonable to expect,
would adversely affect the future condition (financial or
otherwise) assets or liabilities or business of NMDT; or
(8) Taken any action,
which could reasonably
be foreseen to
make any of the
representations or warranties made by NMDT or UTEK untrue as of
the date of this Agreement or as of the Closing Date.
(n) Material
Agreements.
Exhibit A attached contains a true and
complete list of all
contemplated and
executed agreements
between NMDT and a
WSRC. A complete and accurate copy of all material agreements, contracts and
commitments of the
following types,
whether written or oral to which it is
a
party or is bound (Contracts), has been provided to CRGO and such
agreements are
or will be at the Closing Date, in full force and effect
without modifications
or amendment and constitute the legally valid and binding
obligations of NMDT in
accordance with
their respective terms and will continue to be valid and
enforceable following
the Acquisition. NMDT is not in default of any of the
Contracts. In addition:
(1) There are no outstanding unpaid promissory notes,
mortgages, indentures,
deed of trust,
security agreements and other agreements
and instruments relating to the borrowing of money by or any
extension of credit
to NMDT; and
(2) There are no outstanding operating agreements, lease
agreements or similar agreements by which NMDT is bound; and
(3) The complete final
drafts of the License
Agreement have
been provided to CRGO; and
(4) Except as set forth in (3) above, there are no outstanding
licenses to or from others of any intellectual property and trade
names; and
(5) There are no
outstanding agreements
or commitments to
sell, lease or otherwise dispose of any of NMDT's property; and
(6) There are no breaches of any agreement to which NMDT is a
party.
(o) Compliance with
Laws. NMDT is in compliance with all applicable
laws, rules,
regulations and orders promulgated by any federal, state or local
government body or agency relating to its business and
operations.
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(p) Litigation.
There is no suit, action or any arbitration,
administrative, legal
or other proceeding
of any kind or character, or any
governmental
investigation pending
or to the best
knowledge of NMDT or
UTEK,
threatened against
NMDT, the Technology,
or License Agreement,
affecting its
assets or business
(financial or
otherwise),
and neither NMDT nor
UTEK is in
violation of or in default with respect to any judgment,
order, decree or
other
finding of any court or government authority relating to the
assets, business or
properties of NMDT or the transactions contemplated hereby. There
are no pending
or threatened
actions
or proceedings before any court, arbitrator or
administrative agency, which would, if adversely determined,
individually or in
the aggregate, materially and adversely affect the assets or
business of NMDT or
the transactions contemplated.
(q) Employees. NMDT
has no and never had any employees. NMDT is not
a party to or bound by any employment agreement or any collective bargaining
agreement with respect
to any employees.
NMDT is not in
violation of any law,
regulation relating to employment of employees.
(r) Adverse Effect.
Neither NMDT nor UTEK
has any knowledge of any
or threatened existing
occurrence,
action or development that could cause a
material adverse effect on NMDT or its business, assets or condition (financial
or otherwise) or prospects.
(s) Employee Benefit
Plans. NMDT states
that there are no and have
never been any employee benefit plans, and there are no commitments to
create
any, including
without limitation as such term is defined in the Employee
Retirement Income Security Act of 1974, as amended, in effect, and there are no
outstanding or
un-funded liabilities
nor will the execution
of this Agreement
and the actions
contemplated in this
Agreement result in any obligation or
liability to any present or former employee.
(t) Books and Records.
The books and records
of NMDT are
complete
and accurate
in all material respects, fairly present its business and
operations, have been maintained in accordance with good business
practices, and
applicable legal
requirements, and
accurately reflect in all material respects
its business, financial condition and liabilities.
(u) No Broker's
Fees. Neither UTEK nor NMDT has incurred any
investment banking,
advisory or other similar fees or obligations in connection
with this Agreement or the transactions contemplated by this
Agreement.
(v) Full Disclosure.
All representations or
warranties of UTEK and
NMDT are true, correct
and complete in all material respects to the best of our
knowledge on the date of this Agreement and shall be true,
correct and
complete
in all material
respects as of the
Closing Date as if they were made on
such
date. No statement made by them in this Agreement or in the exhibits to
this
Agreement or any document delivered by them or on their
behalf pursuant to this
Agreement contains an
untrue statement of
material fact or omits
to state all
material facts necessary to make the statements in this Agreement
not misleading
in any material respect in light of the circumstances in which they
were made.
2.02
Representations and
Warranties of CRGO. CRGO represents and warrants
to UTEK and NMDT that the facts set forth are true and correct.
(a) Organization.
CRGO is a corporation
duly organized, validly
existing and in good
standing under the laws of Florida,
is qualified to do
business as a foreign corporation in other jurisdictions in which
the conduct of
its business or the ownership of its properties require such
qualification, and
have all requisite
power and authority to conduct its business and operate
properties.
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(b)
Authorization.
The execution
of this Agreement and the
consummation of the Acquisition and the other transactions
contemplated by
this
Agreement have been duly authorized by the board of
directors of CRGO; no other
corporate action on
their respective
parts is necessary in order to execute,
deliver, consummate
and perform their obligations hereunder; and they have all
requisite corporate
and other authority to
execute and deliver this Agreement
and consummate the transactions contemplated by this Agreement.
(c) Capitalization.
The authorized capital of CRGO consists of
5,000,000,000 (5
Billion) shares of
common stock with a
par value $0.001
per
share (CRGO
Common Shares) and on the Effective Date of the Acquisition
1,058,915,827CRGO
Shares (which will include the 168,539,326 CRGO Common Shares
issued at the closing of the Acquisition) will be issued and outstanding. All
issued and outstanding
CRGO Shares
have been duly and
validly issued and
are
fully paid and
non-assessable shares
and have not been issued in violation of
any preemptive or other rights of any other person or any
applicable laws.
(d) Anti Dilution Adjustments. UTEK currently owns 4,838,710
common
shares of CRGO and will be acquiring an additional 168,539,326 unregistered
shares of CRGO totaling 173,378,036 unregistered shares; and based
on a total of
1,058,915,827issued
and outstanding after
the issuance of the shares set forth
herein and this will represent a 16.3% ownership position in CRGO shares. For a
period of twelve months from the date of this Agreement, the
aggregate number of
shares of Stock that UTEK has received shall be adjusted
proportionately by
the
Board of Directors of CRGO for any increase in the number of
outstanding shares
of CRGO Stock
resulting from the issuance of any additional equity securities
(in excess of
100,000,000 CRGO
shares) by the Company to any of its principal
executive management
team. Notwithstanding the above, this anti-dilutive
provision will not
apply to the issuance
of any shares of CRGO stock issued as
compensation to the
Company's management
or members of its board of directors.
In addition, a maximum
of 270,000,000
shares will be
excluded due to the SB-2
registration statement that has previously been filed with the SEC
and is in the
review process. David
Quach, President of
the International
Division of Cargo
Connection Logistics
is excluded up to a maximum of 360,000,000 CRGO shares due
to an existing performance compensation plan.
(e) Binding
Effect. The execution, delivery, performance and
consummation of the
Acquisition
and the transactions contemplated by this
Agreement will not
violate any obligation to which CRGO is a party and will not
create a default
hereunder, and this
Agreement constitutes
a legal, valid and
binding obligation of CRGO, enforceable in accordance with its
terms, except as
the enforcement may be limited by bankruptcy, insolvency,
moratorium, or similar
laws affecting creditor's rights generally and by the availability
of injunctive
relief, specific performance or other equitable remedies.
(f) Litigation
Relating to this Agreement. There are no suits,
actions or proceedings
pending or to its
knowledge threatened which seek to
enjoin the Acquisition
or the transactions
contemplated
by this Agreement
or
which, if adversely decided, would have a materially
adverse effect on its
business, results
of operations, assets, prospects or the results of its
operations of CRGO.
(g) No Conflicting Agreements. Neither the execution and delivery
of
this Agreement nor the
fulfillment
of or compliance by
CRGO with the terms or
provisions of this Agreement will result in a breach of the terms,
conditions or
provisions of, or constitute default under, or result in a violation of,
their
respective corporate charters or bylaws, or any agreement,
contract, instrument,
order, judgment
or decree to which it is a party or
by which it or any of its
assets are bound, or
violate any
provision of any applicable law, rule or
regulation or any order, decree, writ or injunction of any court or
governmental
entity which materially affects its assets or business.
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(h) Consents.
Assuming
the correctness of UTEK and NMDT's
representations, no
consent from or approval of any court, governmental entity
or any other person is necessary in connection with its execution and
delivery
of this Agreement; and the consummation of the transactions
contemplated by this
Agreement will not
require the approval of any entity or person in order
to
prevent the termination of any material right, privilege, license or agreement
relating to CRGO or its assets or business.
(i) Financial
Statements.
The unaudited and audited financial
statements of CRGO set
forth in its filings
with the SEC
present fairly its
financial position and
the results of its
operations on the
dates and for the
periods shown in this
Agreement;
provided, however, that interim financial
statements are subject to customary year-end adjustments and accruals that,
in
the aggregate, will
not have a material adverse effect on the overall financial
condition or results of its operations. CRGO has not engaged in any
business not
reflected in its
financial statements. There have been no material adverse
changes in the nature
of its business,
prospects,
the value of assets or
the
financial condition
since the date of its
financial statements.
There are no
outstanding
obligations or liabilities of CRGO except as specifically set
forth
in the CRGO financial statements.
(j) Full Disclosure.
All representations or
warranties of CRGO are
true, correct
and complete in all material respects on the date of this
Agreement and shall be true, correct and complete in all material
respects as of
the Closing Date as if they were made on such date. No statement
made by them in
this Agreement or in the exhibits to this Agreement or any document
delivered by
them or on their behalf pursuant to this Agreement contains an untrue statement
of material fact or
omits to state all
material facts
necessary to make the
statements in this Agreement not misleading in any material
respect in light
of
the circumstances in which they were made.
(k) Compliance with
Laws. CRGO is in compliance with all applicable
laws, rules,
regulations and orders promulgated by any federal, state or local
government body or agency relating to its business and
operations.
(l) Litigation.
Except as set forth on the schedules set forth
herein (attached
as Exhibit E), there
is no suit, action or
any arbitration,
administrative, legal
or other proceeding
of any kind or character, or any
governmental investigation pending or, to the best knowledge of
CRGO, threatened
against CRGO
materially
affecting
its assets or business (financial or
otherwise), and CRGO
is not in violation
of or in default with
respect to any
judgment, order,
decree or other finding of any court or government authority.
There are no pending or threatened actions or proceedings before any court,
arbitrator or
administrative
agency, which would, if adversely determined,
individually or in the aggregate, materially and adversely affect
its assets or
business. CRGO has no knowledge of any existing or threatened
occurrence, action
or development
that could cause a material adverse affect on CRGO or its
business, assets or condition (financial or otherwise) or
prospects.
(m) Development. CRGO
agrees and warrants that it has the expertise
necessary to
and has had the opportunity to independently evaluate the
inventions of the Licensed Technology and develop same for the
market.
(n) Investment
Company Status CRGO is not an investment
company,
either registered or unregistered.
2.03
Investment
Representations of
UTEK. UTEK represents and warrants to
CRGO that:
(a) General. It has
such knowledge and
experience in financial and
business matters
as to be capable of evaluating the risks and merits of an
investment in CRGO Shares pursuant to the Acquisition. It is able to bear the
economic risk of the
investment in CRGO
Shares, including the
risk of a total
loss of the investment in CRGO Shares. The acquisition of CRGO
Shares is for its
own account and is for
investment and not
with a view to the
distribution of
this Agreement.
Except a permitted
by law, it has a no
present intention
of
selling, transferring or otherwise disposing in any way of all or
any portion of
the shares at the present time. All information that it has supplied to CRGO
is
true and correct. It has conducted all investigations and due diligence
concerning CRGO to
evaluate the risks
inherent in
accepting and holding the
shares which it
deems appropriate, and it has found all such information
obtained fully
acceptable.
It has had an
opportunity to ask
questions of the
officer and
directors of CRGO concerning CRGO Shares and the business and
financial condition of and prospects for CRGO, and the officers and
directors of
CRGO have adequately answered all questions asked and made all relevant
information available
to them. UTEK is an accredited investor, as the term is
defined in Regulation
D, promulgated under the Securities Act of 1933, as
amended, and the rules and regulations thereunder.
Page 8 of 46
<PAGE>
(b) Stock Transfer
Restrictions. UTEK
acknowledges
that the CRGO
Shares will
not be registered and UTEK will not be permitted to sell or
otherwise transfer the
CRGO Shares in any transaction in contravention of the
following legend, which will be imprinted in substantially the
following form on
the stock certificate representing CRGO Shares:
THE SECURITIES
REPRESENTED BY THIS
CERTIFICATE HAVE NOT
BEEN REGISTERED UNDER
THE SECURITIES ACT OF
1933, AS AMENDED (THE ACT), OR UNDER THE SECURITIES LAWS
OF ANY STATE. THESE
SECURITIES
MAY NOT BE SOLD,
OFFERED FOR SALE,
ASSIGNED,
TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS REGISTERED PURSUANT TO
THE PROVISION
OF THE ACT AND THE LAWS OF SUCH STATES UNDER WHOSE LAWS A TRANSFER
OF SECURITIES
WOULD BE SUBJECT TO A
REGISTRATION
REQUIREMENT, UNLESS
UTEK CORPORATION
HAS
OBTAINED AN OPINION OF COUNSEL STATING THAT SUCH DISPOSITION IS IN COMPLIANCE
WITH AN AVAILABLE EXEMPTION FROM SUCH REGISTRATION.
(c) Legend. Subject to
Rule 144 restrictions,
12 months
following
the stock acquisition
described herein, CRGO agrees to and shall
direct its
transfer agent to
remove the above
legend upon the
issuance by UTEK's
legal
counsel that the above legend can be removed from UTEK's shares.
CRGO agrees to
and promptly shall provide any information requested by UTEK or UTEK's
counsel
and to make further
direction to its transfer agent as necessary for such
issuance of an
opinion regarding removal of the legend or the sale of such
restricted shares under Rule 144 or other available exemption from
registration.
A letter affecting
the issuance of the certificate without the restrictive
legend one year from the date of closing is attached as Exhibit
D.
(d) Failure to Remove Legend. In the event that CRGO fails to
direct
its transfer agent to
remove the legend within fifteen (15) days of request
by
UTEK, CRGO shall be
liable to an
additional fee of ten
percent (10%) of the
current value of the
shares held by UTEK,
as well as any and all attorney fees
and costs that UTEK
may incur as a result
of CRGO failing to comply in this
request.
(e) Stock Transfer Restrictions. UTEK will have "piggyback"
registration rights
for all of the common shares it will receive in this
transaction. Notwithstanding the above, UTEK agrees that its shares
shall not be
registered in the SB-2 Registration Statement currently filed with the SEC
and
in the review process.
Page 9 of 46
<PAGE>
ARTICLE 3
TRANSACTIONS PRIOR TO CLOSING
3.01.
Corporate Approvals. Prior to Closing Date, each of the parties
shall submit this
Agreement to its board of directors and when necessary, its
respective
shareholders and
obtain approval of this Agreement. Copies of
corporate actions taken shall be provided to each party.
3.02
Access to Information.
Each party agrees to permit, upon reasonable
notice, the
attorneys,
accountants,
and other representatives of the other
parties reasonable access during normal business hours to its
properties and its
books and records to make reasonable investigations with respect to
its affairs,
and to make its officers and employees available to answer
questions and provide
additional information as reasonably requested.
3.03
Expenses. Each party agrees to bear its own
expenses in
connection
with the negotiation
and consummation of
the Acquisition and the transactions
contemplated by this Agreement.
3.04
Covenants. Except as
permitted in writing, each party agrees that it
will:
(a) Use its good faith
efforts to obtain all
requisite licenses,
permits, consents, approvals and authorizations necessary in order
to consummate
the Acquisition; and
(b) Notify the other parties upon the occurrence of any event which
would have a materially adverse effect upon the
Acquisition or the transactions
contemplated by this
Agreement or upon the business, assets or results of
operations; and
(c) Not modify its
corporate structure, except as necessary or
advisable in
order to consummate the Acquisition and the transactions
contemplated by this Agreement.
ARTICLE 4
CONDITIONS PRECEDENT
The
obligation
of the parties to consummate the Acquisition and the
transactions
contemplated by
this Agreement are subject to the following
conditions that may be waived, to the extent permitted by law:
4.01.
Each party must obtain
the approval of its board of directors and
such approval shall not have been rescinded or restricted.
4.02. Each
party shall obtain all requisite licenses, permits, consents,
authorizations and
approvals required to complete the Acquisition and the
transactions contemplated by this Agreement.
4.03.
There shall be no
claim or litigation
instituted or
threatened in
writing by any person or government authority seeking to restrain or
prohibit
any of the contemplated transactions contemplated by this Agreement
or challenge
the right, title and interest of UTEK in the NMDT Shares or the
right of NMDT or
UTEK to consummate the Acquisition contemplated hereunder.
4.04. The
representations and
warranties of the parties shall be true and
correct in all material respects at the Effective Date.
4.05. The
Technology and Intellectual Property has been prosecuted in
good
faith with reasonable diligence.
Page 10 of 46
<PAGE>
4.06. To
the best knowledge of
UTEK and NMDT, the
License Agreement
are
valid and in full force and effect without any default in this
Agreement.
4.07. CRGO
shall have received,
at or within 5 days of Closing Date, each
of the following:
(a) the stock
certificates
representing
the NMDT Shares, duly
endorsed (or
accompanied
by duly executed stock powers) by UTEK for
cancellation;
(b) all documentation relating to NMDT's business, all in a form
and
substance satisfactory to CRGO;
(c) such agreements,
files and other data and documents pertaining
to NMDT's business as CRGO may reasonably request;
(d) copies of the general ledgers and books of account of
NMDT, and
all federal, state and local income, franchise, property and other tax returns
filed by NMDT since the inception of NMDT;
(e) certificates
of (i) the
Secretary of State of the State of
Florida as to the legal existence and good standing, as applicable, (including
tax) of NMDT in Florida;
(f) the original
corporate minute books of NMDT, including the
articles of
incorporation and
bylaws of NMDT, and all other documents filed in
this Agreement;
(g) all consents,
assignments or related documents of conveyance to
give CRGO the benefit of the transactions contemplated
hereunder;
(h) such documents as
may be needed to accomplish the Closing under
the corporate laws of the states of incorporation of CRGO and NMDT,
and
(i) such other
documents, instruments
or certificates as
CRGO, or
their counsel may reasonably request.
4.08.
CRGO shall have
completed due
diligence
investigation of NMDT
to
CRGO's satisfaction in their sole discretion.
4.09.
CRGO shall
receive the
resignation
effective the Closing
Date of
each director and officer of NMDT.
ARTICLE 5
INDEMNIFICATION AND LIABILITY LIMITATION
5.01.
Survival of Representations and Warranties.
(a) The
representations and
warranties made by UTEK and NMDT shall
survive for a period of 1 year after the Closing Date, and thereafter all such
representation and
warranties
shall be extinguished, except with respect to
claims then pending for which specific notice has been given during such
1-year
period.
Page 11 of 46
<PAGE>
(b) The
representations and
warranties made by
CRGO shall survive
for a
