AGREEMENT AND PLAN OF ACQUISITION
between
UNITED ECOENERGY CORP.
and
EPIC WOUND CARE, LLC
Dated May 19, 2009
AREEMENT AND PLAN OF ACQUISITION ("Agreement") dated as of May 19,
2009
between United EcoEnergy Corp., a Nevada corporation (UEEC), and
Epic Wound
Care LLC, a Nevada limited liability company (Epic)
RECITALS
WHEREAS, the Board of
Directors or Managers of each of UEEC and Epic
deem it advisable for the general welfare of Epic and its
members, that UEEC
acquire the operating assets and businesses of Epic hereafter
identified; and
WHEREAS, as a business
development company under the Investment
Company Act of 1940, UEEC deems it appropriate that the operating
assets
and businesses of Epic to be acquired by UEEC be acquired by a
new
corporation formed by UEEC for the purpose (sometimes herein
referred to as
the Company) by the issue of shares of UEEC to the members of Epic
or to
their designees (collectively Sellers) as a portfolio investment of
UEEC;
NOW, THEREFORE, UEEC, Epic and
Company agree that the assets and
business of Epic as hereafter identified (the Assets) shall be
transferred to
the Company in exchange for shares in UEEC to be issued to Sellers,
that
UEEC shall hold all of the issued and outstanding shares of
Company, and
that the terms and conditions of the acquisition and the manner of
carrying
it into effect shall be as follows:
ARTICLE 1: THE STOCK ACQUISITION
1.1 Acquisition.
At the Effective Time (as defined in Section 1.2),
upon the terms and subject to the conditions of this Agreement,
UEEC shall
hold all of the issued and outstanding shares of Company and
Company shall
acquire all of the Assets of Epic in exchange for a total of up to
Thirty
Million (30,000,000) shares of the common stock of UEEC (the
Shares) on the
terms and conditions hereafter set forth. This Agreement
shall be submitted
to the Boards of Directors of UEEC and Epic in the manner
prescribed by, and
if required by, applicable laws and, if applicable, approved
at shareholder
meetings called for that purpose or by written consents in lieu of
meetings.
1.2 Transfer of
Shares. UEEC shall cause to be issued at Closing
stock certificates for a total of 30,000,000 shares of the common
stock of
UEEC, on the following basis:
1.2.1 Initial Issue and Transfer. At
Closing, UEEC shall issue to
Sellers certificates for a total of 10,000,000 Shares, in such
names and in
such amounts as Sellers shall designate before Closing, and Epic
shall transfer
and convey to the Company all of the Assets of Epic.
1.2.2.
Second Issue and Transfer. At Closing, UEEC shall
issue
to the escrow agent to be named by the Parties at Closing,
certificates for
a total of 10,000,000 Shares, in such names and in such amounts as
Sellers
shall designate before Closing, which shares shall be released by
the
escrow agent within five (5) business days after the first to occur
of (i)
the closing bid price for UEEC common stock on the trading market
on which
such stock is then trading is $1.25 per share for any thirty
(30)
consecutive trading days or (ii) the Company earns cumulative gross
revenues
from operations of $2,000,000 or more in the first twelve (12) full
calendar
months after Closing; provided, however, that if neither condition
has been
met by the 15th day of the thirteenth month after Closing, then the
Shares
under this Section 1.2.2 shall be returned by the escrow agent to
UEEC, shall
be cancelled, and Sellers shall have no further claim to any such
Shares.
1.2.3 Third Issue and Transfer. UEEC
shall issue to the escrow
agent to be named by the Parties at Closing, certificates for a
total of
10,000,000 Shares, in such names and in such amounts as Sellers
shall
designate before Closing, which shares shall be released by the
escrow
agent within five (5) business days after the first to occur of (i)
the
Company earning cumulative gross revenues from operations of
$5,000,000 or
more in any consecutive period of twelve full calendar months after
Closing,
and (ii) the date which is eighteen (18) calendar months after the
date of
Closing; provided, however, that if the condition listed in Section
1.2.3(i)
has not occurred by the date which is eighteen (18) calendar months
after the
date of Closing, then only 5,000,000 of the 10,000,000 Shares held
in escrow
shall be released to Sellers if the Company does not then hold 100
percent
of the exclusive rights to develop, distribute, market and
sell the product
known as Prestich, and the remaining 5,000,000 Shares shall be
returned by
the escrow agent to UEEC, shall be cancelled, and Sellers shall
have no
further claim to any such Shares.
1.2.4. Early
Release from Escrow. In the event that UEEC sells
the stock of the Company acquired hereunder, or substantially all
of the
assets of the Company, for an amount greater than $15 million
in total
consideration, then any Shares still held in escrow at the closing
of such
a transaction under Articles 1.2.2 or 1.2.3 shall be released to
Sellers by
the escrow agent.
1.2.5 Restrictions on Re-sale.
For purposes of Article 1.2.4,
UEEC agrees that, for a period of twelve (12) months after
Closing, it
will not sell, convey or transfer the assets of the Company, or
sell,
convey or transfer the stock of the Company acquired hereunder, for
a total
consideration of less than $30 million without the prior consent of
Sellers.
1.2.6.
Voting of Escrow Shares. The Shares shall be held by a
mutually agreed upon escrow agent, agreed upon between UEEC and
Epic at or
before Closing. For all purposes in which shareholders of
UEEC are
entitled to vote on any matter, the Shares held by the escrow agent
under
Articles 1.2.2 and 1.2.3 shall vote as directed by written
instructions
delivered by the Chairman and CEO of UEEC to the escrow agent, and
Sellers
shall have no rights to vote such Shares until the Shares are
released by the
escrow agent.
1.3 Effective Time;
Closing. Immediately upon the execution of this
Agreement by Epic and the execution and adoption of this Agreement
by the
Boards of Directors of Company, Epic and UEEC, and the satisfaction
or waiver
of the conditions set forth in Article 5 (the last date of such
execution,
satisfaction or waiver being the "Effective Time"), the parties
hereto shall,
within ten (10) days of the Effective Time, cause the Asset
acquisition to be
consummated by executing and delivering the acquisition documents
as provided
herein, and the parties shall take all such other and further
actions as
may be required by law to cause the Asset acquisition to become
effective
immediately (the Closing). The parties anticipate that the
Closing shall be on
or before May 31, 2009.
1.4 Effect of the
Acquisition. At and after the Closing, Company shall
continue as a separate corporate entity and as a wholly owned
subsidiary of
UEEC, all of the business, property, rights, privileges, powers and
franchises
of Epic and all debts, liabilities and duties of Epic, shall be
transferred to
and continue in the Company.
1.5 Articles of
Incorporation; By-Laws; Directors and Officers.
(a) At the Effective
Time, the Articles of Incorporation of Company
as in effect immediately before the Effective Time shall continue
as the
Articles of Incorporation of Company until thereafter amended as
provided by
law.
(b) At the Effective
Time, the By-Laws of Company, as in effect
immediately before the Effective Time, shall continue as the
By-Laws of
Company until thereafter amended as provided by law, the Articles
of
Incorporation of Company and such By-Laws.
(c) The board of
directors of Company after the Effective Time
shall be elected by written consent action of UEEC as the sole
shareholder
of Company entitled to vote thereon in lieu of an Annual or Special
Meeting
of Shareholders, to serve until their successors are duly elected
or
appointed and shall qualify. The officers of Company shall
thereafter be
elected by the newly elected Board of Directors and shall serve
until their
successors are duly elected or appointed and shall
qualify.
ARTICLE 2: ASSETS
2.1 Working Capital
Amount. The Assets to be acquired from Epic
shall include all of the assets used in or necessary to the
operation of the
business or proposed business of Epic, and shall include the assets
identified
on Schedule 2.1.
2.2 Debt
Assumption. All outstanding liabilities and expenses for
operations of Company, and its predecessor in interest as listed on
Schedule
2.2, shall be currently reflected on the financial records of
Company at
Closing and will be paid in due course by Company. There will
be no other
liabilities and debts of Company not reflected on Schedule 2.2.
ARTICLE 3: REPRESENTATIONS AND WARRANTIES OF UEEC
UEEC represents and warrants
to, and agrees with, Sellers as follows:
3.1
Organization. UEEC is a corporation duly
organized, validly
existing and in good standing under the laws of the State of
Nevada, with
its principal place of business located in Florida. UEEC has
all requisite
corporate power and authority to own, lease and operate its
properties and to
carry on its business as now being conducted. UEEC is duly
qualified to
do business and in good standing as a foreign corporation in each
other
jurisdiction, if any, in which its property or business makes
such
qualificationnecessary.
3.2 Authority Relative
to this Agreement. UEEC 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
and the consummation of the transactions contemplated hereby have
been duly and
validly authorized by the Board of Directors of UEEC and no other
corporate
proceedings on the part of UEEC are necessary to authorize this
Agreement or to
consummate the transactions contemplated hereby. This
Agreement has been duly
and validly executed and delivered by UEEC and constitutes a valid
and binding
agreement, enforceable against it in accordance with its terms.
3.3 No Conflict;
Required Filings and Consents.
(a) The execution and delivery of this Agreement by UEEC does
not,
and the consummation of the transactions contemplated hereby will
not, (i)
conflict with or violate any law, regulation, court order, judgment
or decree
applicable to UEEC or by which its properties are bound or
affected, (ii)
violate or conflict with either the Articles of Incorporation or
By-Laws of
UEEC or (iii) result in any breach of or constitute a default (or
an event
which with notice or lapse of time or both would become a default)
under, or
give to others any right of termination or cancellation of, or
result in the
creation of a lien on any of the properties of UEEC pursuant to any
contract
to which UEEC is a party or by which UEEC or any of its respective
properties
isbound or affected.
(b) UEEC is not required to submit any notice, report or other
filing with any governmental entity or regulating body, domestic or
foreign,
in connection with the execution, delivery or performance of this
Agreement
or the consummation of the transactions contemplated hereby.
No waiver,
consent, approval or authorization of any governmental entity or
regulatory
body, domestic or foreign, is required to be obtained or made by
UEEC in
connection with its execution, delivery or performance of this
Agreement or
the consummation of the transactions contemplated hereby.
3.4
Capitalization. As of the Closing, UEEC shall have
authorized
capital stock of 150,000,000 shares of common stock, of which
34,710,537
shares of common stock will be issued and outstanding at the
Effective
Date, not including the shares to be issued under this Agreement,
and
5,000,000 shares of preferred stock, of which no shares are issued
and
outstanding. All the outstanding shares of capital
stock of UEEC have been
duly authorized and are validly issued, and
non-assessable.
3.5 Transfer
Restrictions. There are no restrictions on the
transfer of shares of capital stock of UEEC other than those
imposed by
relevant federal and state securities laws and as otherwise
contemplated by
this Agreement. The offer and sale of all capital stock and
other securities
of UEEC issued before the date hereof and to be issued hereafter
complied with
or were exempt or will comply with or be exempt from all applicable
federal
and state securities laws and no stockholder has a right of
rescission or
damages with respect thereto. UEEC does not have outstanding,
and has no
obligation to grant or issue, any phantom stock or other right
measured by
the profits, revenues or results of operations of UEEC or any
portion thereof;
or any similar rights.
3.6 Litigation. No
investigation or review by any governmental entity
or regulatory body, foreign or domestic, with respect to UEEC is
pending or
threatened against UEEC, and no governmental entity or regulatory
body has
advised UEEC of an intention to conduct the same. There is no
claim, action,
suit, investigation or proceeding pending or threatened against or
affecting
UEEC at law or in equity or before any federal, state, municipal or
other
governmental entity or regulatory body, or which challenges the
validity of
this Agreement or any action taken or to be taken by UEEC pursuant
to this
Agreement. As of the date hereof, UEEC is not subject to, nor
is there in
existence, any outstanding judgment, award, order, writ, injunction
or decree
of any court, governmental entity or regulatory body relating to
UEEC.
ARTICLE 4: REPRESENTATIONS AND WARRANTIES OF EPIC
Epic represents and warrants
to, and agrees with, UEEC as follows:
4.1 Organization.
Epic is a limited liability company duly
organized, validly existing and in good standing under the laws of
the
State of Nevada and has all requisite power and authority to own,
lease and
operate its business and properties and to carry on its business as
now
being conducted by Epic, including the Assets. Epic will be
duly
qualified to do business in and in good standing as a foreign
corporation
in each jurisdiction in which property owned, leased or operated by
it
or the nature of the business conducted by it makes such
qualification
necessary. Epic has heretofore delivered to or will deliver
to UEEC
true, accurate and complete copies of its Articles of Formation and
other
governing documents as in effect on the date hereof and minutes of
all
meetings of members and managers of Epic held through and including
the date
of this Agreement and through the Effective Date. Epic is not
in violation
of any of the provisions of its Articles of Formation and other
governing
documents.
4.2 Authority Relative
to this Agreement. Epic has or will have
full power and authority to execute and deliver this Agreement and
to
consummate the transactions contemplated hereby. The
execution and delivery
of this Agreement and the consummation of the transactions
contemplated
hereby have been duly and validly authorized by the members and
managers of
Epic, and no other proceedings are necessary to authorize this
Agreement
or to consummate the transactions contemplated hereby. This
Agreement has
been duly and validly executed and delivered by Epic and
constitutes a valid
and binding agreement, enforceable against them in accordance with
its terms.
4.3 No Conflict;
Required Filings and Consents.
(a) The execution and delivery of this Agreement by Epic does
not, and the consummation of the transactions contemplated hereby
will not,
(i) conflict with or violate any law, regulation, court order,
judgment or
decree applicable to Epic, or by which its properties are bound
or
affected, (ii) violate or conflict with either the Articles of
Formation
or other governing documents of Epic or (iii) result in any breach
of or
constitute a default (or an event which with notice or lapse of
time or both
would become a default) under, or give to others any right of
termination or
cancellation of, or result in the creation of a lien on any of the
properties
of Epic pursuant to any contract to which Epic is a party or by
which Epic, or
any of its respective properties is bound or affected.
(b) Epic is not required to submit any notice, report or other
filing with any governmental entity or regulating body, domestic or
foreign,
in connection with the execution, delivery or performance of this
Agreement
or the consummation of the transactions contemplated hereby.
No waiver,
consent, approval or authorization of any governmental entity or
regulatory
body, domestic or foreign, is required to be obtained or made by
Epic in
connection with the execution, delivery or performance of this
Agreement or
the consummation of the transactions contemplated hereby.
4.4 Financial
Statements.
(a) The balance sheets of Epic, as of December 31, 2008 and
April 30, 2009 (the Epic Balance Sheets), and the related
statements of income
and retained earnings for the periods ending December 31, 2008 and
April 30,
2009 (the Epic Financial Statements), will be prepared by Epic and
UEEC and
derived from the financial statements of MedSpring (the predecessor
to Epic)
and such other sources as Epic and UEEC agree, prior to and as a
condition
to Closing, and Epic and UEEC will be satisfied that they fairly
present
the financial condition of Epic as of said dates and the results of
their
operations for the periods then ended, in conformity with GAAP
consistently
applied for the periods covered.
(b) Epic will deliver to UEEC at Closing, Interim Financial
Statements which fairly present the financial condition of Epic, as
of the
Effective Time and since April 30, 2009 and the results of their
operations
for the periods then ended, in conformity with GAAP consistently
applied for
the periods covered.
4.5 Real and Personal
Property. Epic does not own any real property.
Epic, has good and marketable title to, or valid leasehold
interests in, all
other assets used or held for use in the conduct of its business,
including
the Assets. All of the Assets owned or leased by Epic are in
all material
respects in good condition and repair, ordinary wear and tear
excepted,
and well maintained. There are no material capital
expenditures currently
contemplated or necessary to maintain the current business of
Epic.
4.6 Absence of
Undisclosed Liabilities. Except to the extent
reflected or reserved against in the Epic Interim Financial
Statements, Epic
will not have at the Effective Time any liabilities or obligations
(secured,
unsecured, contingent or otherwise) of a nature customarily
reflected in
a corporate balance sheet prepared in accordance with generally
accepted
accounting principles ("Liabilities")
4.7 Absence of Certain
Changes. Since April 30, 2009, (i) there has
been no material adverse change in the condition (financial or
otherwise),
assets, liabilities, results of operations, business or prospects
of Epic and
(ii) nothing has occurred relative to the business or prospects of
Epic which
would have a material adverse effect on their future business.
4.8 Litigation. No
investigation or review by any governmental entity
or regulatory body, foreign or domestic, with respect to Epic is
pending or
threatened and no governmental entity or regulatory body has
advised Epic
of an intention to conduct the same. There is no claim,
action, suit,
investigation or proceeding pending or threatened against or
affecting Epic
at law or in equity or before any federal, state, municipal or
other
governmental entity or regulatory body, or which challenges the
validity of
this Agreement or any action taken or to be taken by Epic pursuant
to this
Agreement. As of the date hereof, Epic is not subject to, nor
is there in
existence, any outstanding judgment, award, order, writ, injunction
or decree
of any court, governmental entity or regulatory body relating to
Epic.
4.9 Contracts.
(a) Epic has provided UEEC with copies of all material
contracts, agreements, leases, licenses, arrangements, commitments,
sales
orders, purchase orders or any claim or right or any benefit or
obligation
arising thereunder or resulting therefrom and currently in effect,
whether
oral or written to which Epic is a party (Contracts),
including:
(i) any Contract (or group of related Contracts)
for the lease of real or personal property to or from any person
providing for
lease payments in excess of $1,000 per annum;
(ii) any Contract (or group of related
Contracts)
for the purchase or sale of raw materials, commodities, supplies,
products,
or other personal property, or for the furnishing or receipt of
services,
the performance of which will extend over a period of more than
o