DISTRIBUTION AGREEMENTDistribution Agreement |
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Exhibit 10
DISTRIBUTION AGREEMENT
THIS DISTRIBUTION AGREEMENT (the “Agreement”), made and effective as of November 23, 2007, is entered into by and between ComCam, Inc., a Delaware corporation (the “Parent”) and ComCam International, Inc., a Delaware corporation (the “Subsidiary”).
WITNESSETH, WHEREAS the Parent currently owns 100% of the outstanding common stock of the Subsidiary, which is the only issued and outstanding class of capital stock of the Subsidiary; and
WHEREAS, the Board of Directors of the Parent has determined that it is in the best interest of the Parent to distribute its entire ownership interest in the Subsidiary through a pro-rata distribution of all the outstanding common shares of the Subsidiary to the holders of the Parent’s common stock in the form of a dividend pursuant to the terms and subject to the conditions of this Agreement (the “Distribution”); and
WHEREAS, the Distribution is intended to qualify as a tax-free spin-off pursuant to Section 355 of the Internal Revenue Code of 1986; and
WHEREAS, the parties hereto intend this agreement to set forth the principal terms and arrangements among and between them regarding the Distribution.
NOW THEREFORE, in consideration of the premises and the mutual covenants herein contained and intending to be legally bound hereby, the parties hereto agree as follows:
1. Distribution . The Parent’s Board of Directors, as of the date of this Agreement, has authorized the Distribution, payable to shareholders of record of the Parent as of the Record Date and entitled to shareholders of record of the Parent as of the Dividend Date. The Distribution shall be pro rata, so that shareholders of the Parent have the same proportionate interest and ownership in the Subsidiary as held by them in the Parent immediately prior to the Dividend Date of this spin-off. The Distribution also shall be conducted to qualify as a tax-free spin-off.
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2. |
Governing Dates. |
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a) |
Record Date – the close of business on December 7, 2007, being the date for determining the holders of the Parent’s common stock that will receive common shares of the Subsidiary in the Distribution, as well as the date for determining the registered holders of the Parent’s common stock that will receive an information statement regarding the Distribution. |
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b) |
Dividend Date – the close of business on December 28, 2007, being the date for determining the holders of the Parent’s common stock that are entitled to the common shares of the Subsidiary in the Distribution, as well as being the date when the Parent and the Subsidiary are effectively separated. |
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c) |
Ex-Dividend Date – the close of business on or about December 31, 2007, as determined by NASDAQ, the date when the Subsidiary’s common shares are distributed to the Parent’s shareholders as of the Record Date. |
3. Distribution Ratio . Shareholders of the Parent will receive in the Distribution that number of common shares of the Subsidiary which is equal to one (1) common share of the Subsidiary for each twenty (20) common shares of the Parent held by them as of the close of business on the Record Date. No fractional shares or payment therefore shall be made incident to the Distribution; rather any fractional shares of the Subsidiary to be received by the Parent’s shareholders shall be rounded up to the next whole share.
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Exhibit 10
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4. |
Conditions to Distribution . The consummation of the Distribution will be subject to the following: |
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a) |
A minimum of ten (10) days prior to the Dividend Date, the parties hereto will prepare and mail to the registered shareholders of the Parent on the Record Date, such information regarding the Subsidiary and the Distribution as the parties reasonably determine and as may be required by law. |
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b) |
Prior to the Dividend Date, the Parent will file with the Securities and Exchange Commission any such documentation that the Parent determines is necessary or desirable to effect the Distribution. |
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c) |
Prior to the Dividend date, the Parent shall sell or convey all of its assets and rights, intellectual property, and any other tangible or intangible property related to the Subsidiary’s products, to the Subsidiary. |
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d) |
No order, injunction, decree or regulation issued by any court or agency of competent jurisdiction or other legal restraint or prohibition preventing the consummation of the Distribution will be in effect and no other event outside the control of the Subsidiary will have occurred or failed to occur that prevents the con |
