EXHIBIT 2.2
SECURITIES EXCHANGE
AGREEMENT
THIS SECURITIES EXCHANGE
AGREEMENT (this
“Agreement”) is made as of January 19, 2006, by and
between Gabriel Technologies Corporation., a Delaware corporation
(the “Buyer”), and Resilent LLC, a Nebraska limited
liability company (the “Company”).
Whereas, Buyer desires to acquire, the majority of the
issued and outstanding units (the “Units”) of
membership interests of the Company for the consideration and on
the terms set forth in this Agreement.
Now, therefore, the parties, intending to be legally bound,
agree as follows:
For purposes of this Agreement, the following
terms have the meanings specified or referred to in this Section
1:
“Affiliate”
—shall have the meaning set
forth in Rule 12b-2 of the Rules and Regulations under the Exchange
Act.
“Applicable
Contract” —any Contract (a) under which the Company
has or may acquire any rights, (b) under which the Company has or
may become subject to any obligation or liability, or (c) by which
the Company or any of the assets owned or used by it is or may
become bound.
“Balance Sheet”
—as defined in Section
3.4.
“Best Efforts”
—the efforts that a prudent
Person desirous of achieving a result would use in similar
circumstances to ensure that such result is achieved as
expeditiously as possible; provided, however, that an obligation to
use Best Efforts under this Agreement does not require the Person
subject to that obligation to take actions that would result in a
materially adverse change in the benefits to such Person of this
Agreement and the Contemplated Transactions.
“Business Day”
—any day other than a
Saturday, a Sunday or a day on which commercial banks in Omaha,
Nebraska are required or authorized to be closed.
“Buyer”
—as defined in the preamble of
this Agreement.
“Buyer’s
Shares” —as used herein shall mean shares of the
common stock of Gabriel Technologies Corporation which have not
been registered under the Securities Act.
“Closing”
—as defined in Section
2.3.
“Closing Date”
—the date and time as of which
the Closing actually takes place.
“Company”
—as defined in the preamble of
this Agreement.
“Consent”
—any approval, consent,
ratification, waiver, or other authorization (including any
Governmental Authorization).
“Contemplated
Transactions” —all of the transactions contemplated by
this Agreement, including:
(a) the issuance of the Units to
Buyer;
(b) the issuance of a Promissory Note for the
payment of $2,000,000 to the Company as set forth
herein;
(c) the issuance of 3,000,000 restricted shares
of Buyer’s common stock to the Company, subject to
performance conditions set forth herein;
(d) the execution, delivery, and performance of
the Employment Agreement;
(e) the execution and delivery of Buyer’s
Voting Proxy as set forth herein;
(f) the performance by Buyer and Company of
their respective covenants and obligations under this Agreement;
and
(g) Buyer’s acquisition and ownership of
the Units.
“Contract”
—any agreement, contract,
obligation, promise, or undertaking (whether written or oral and
whether express or implied) that is legally binding.
“Employment
Agreement” —as defined in Section 2.4(a)
(ii).
“Encumbrance”
—any charge, claim, community
property interest, condition, equitable interest, lien, option,
pledge, security interest, right of first refusal, or restriction
of any kind, including any restriction on use, voting, transfer,
receipt of income, or exercise of any other attribute of
ownership.
“ERISA”
—the Employee Retirement
Income Security Act of 1974 or any successor law, and regulations
and rules issued pursuant to that Act or any successor
law.
“Exchange Act”
—the Securities Exchange Act
of 1934, as amended, or any successor law, and regulations and
rules issued pursuant thereto.
“Facilities”
—any real property,
leaseholds, or other interests currently or formerly owned or
operated by the Company and any buildings, plants, structures, or
equipment (including motor vehicles, tank cars, and rolling stock)
currently or formerly owned or operated by the
Company.
“GAAP” —generally accepted United States
accounting principles, applied on a basis consistent with the basis
on which the Balance Sheet and the other financial statements
referred to in Section 3.4(b) were prepared.
“Governmental
Authorization” —any approval, consent, license, permit,
waiver, or other authorization issued, granted, given, or otherwise
made available by or under the authority of any Governmental Body
or pursuant to any Legal Requirement.
“Governmental Body”
—any:
(a) nation, state, county, city, town, village,
district, or other jurisdiction of any nature;
(b) federal, state, local, municipal, foreign,
or other government;
(c) governmental or quasi-governmental authority
of any nature (including any governmental agency, branch,
department, official, or entity and any court or other
tribunal);
(d) multi-national organization or body;
or
(e) body exercising, or entitled to exercise,
any administrative, executive, judicial, legislative, police,
regulatory, or taxing authority or power of any nature.
“Intellectual Property
Assets” —as defined in Section 3.22.
“Interim Balance
Sheet” —as defined in Section 3.4.
“IRC” —the Internal Revenue Code of 1986 or any
successor law, and regulations issued by the IRS pursuant to the
Internal Revenue Code or any successor law.
“IRS” —the United States Internal Revenue
Service or any successor agency, and, to the extent relevant, the
United States Department of the Treasury.
“Knowledge”
—an individual will be deemed
to have “Knowledge” of a particular fact or other
matter if such individual is actually aware of such fact or other
matter after reasonable investigation. A Person (other than an
individual) will be deemed to have “Knowledge” of a
particular fact or other matter if any individual who is serving,
or who has at any time served, as a director, officer, partner,
executor, or trustee of such Person (or in any similar capacity)
has, or at any time had, Knowledge of such fact or other
matter.
“Legal Requirement”
—any federal, state, local,
municipal, foreign, international, multinational, or other
administrative order, constitution, law, ordinance, principle of
common law, regulation, statute, or treaty.
“material”
— shall have the meaning set
forth in Rule 12b-2 of the Rules and Regulations under the Exchange
Act.
“material adverse
effect” or
“ material adverse change” — any
effect or change that would be materially adverse to the business,
assets, condition (financial or otherwise), operating results,
operations, or business prospects of the specified Person and its
Subsidiaries, taken as a whole, or on the ability of any party to
consummate timely the transactions contemplated hereby.
“Order”
—any award, decision,
injunction, judgment, order, ruling, subpoena, or verdict entered,
issued, made, or rendered by any court, administrative agency, or
other Governmental Body or by any arbitrator.
“Ordinary Course of
Business” —an action taken by a Person will be
deemed to have been taken in the “Ordinary Course of
Business” only if:
(a) Such action is consistent with the past
practices of such Person and is taken in the ordinary course of the
normal day-to-day operations of such Person;
(b) Such action is not required to be authorized
by the board of directors of such Person (or by any Person or group
of Persons exercising similar authority); and
(c) Such action is similar in nature and
magnitude to actions customarily taken, without any authorization
by the board of directors (or by any Person or group of Persons
exercising similar authority), in the ordinary course of the normal
day-to-day operations of other Persons that are in the same line of
business as such Person.
“Organizational
Documents” —(a) the articles or certificate of
incorporation 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 of limited partnership of a limited partnership;
(d) any charter or similar document adopted or filed in
connection with the creation, formation, or organization of a
Person; and (e) any amendment to any of the
foregoing.
“Person”
—any individual, corporation
(including any non-profit corporation), general or limited
partnership, limited liability company, joint venture, estate,
trust, association, organization, labor union, or other entity or
Governmental Body.
“Plan” —as defined in Section 3.13.
“Plan of Exchange”
—as defined in Section
2.2.
“Purchase Price”
—shall mean Two Million
Dollars ($2,000,000.00) in cash payments pursuant to a Promissory
Note made by Buyer; and Three Million (3,000,000) shares of
Buyer’s common stock, of which 1,5000,000 shall be subject to
meeting financial performance goals for the Company as described
herein.
“Proceeding”
—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 Governmental Body or arbitrator.
“Related Person”
—with respect to a particular
individual:
(a) Each other member of such individual’s
Family;
(b) Any Person that is directly or indirectly
controlled by such individual or one or more members of such
individual’s Family;
(c) Any Person in which such individual or
members of such individual’s Family hold (individually or in
the aggregate) a Material Interest; and
(d) Any Person with respect to which such
individual or one or more members of such individual’s Family
serves as a director, officer, partner, executor, or trustee (or in
a similar capacity).
With respect to a specified Person other than an
individual:
(a) Any Person that directly or indirectly
controls, is directly or indirectly controlled by, or is directly
or indirectly under common control with such specified
Person;
(b) Any Person that holds a Material Interest in
such specified Person;
(c) Each Person that serves as a director,
officer, partner, executor, or trustee of such specified Person (or
in a similar capacity);
(d) Any Person in which such specified Person
holds a Material Interest;
(e) Any Person with respect to which such
specified Person serves as a general partner or a trustee (or in a
similar capacity); and
(f) Any Related Person of any individual
described in clause (b) or (c).
For purposes of this definition, (a) the
“Family” of an individual includes (i) the individual,
(ii) the individual’s spouse and former spouses, (iii) any
other natural person who is related to the individual or the
individual’s spouse within the second degree, and (iv) any
other natural person who resides with such individual, and (b)
“Material Interest” means direct or indirect beneficial
ownership (as defined in Rule 13d-3 under the Exchange Act) of
voting securities or other voting interests representing at least
5% of the outstanding voting power of a Person or equity securities
or other equity interests representing at least 5% of the
outstanding equity securities or equity interests in a
Person.
“Representative”
—with respect to a particular
Person, any director, officer, employee, agent, consultant,
advisor, or other representative of such Person, including legal
counsel, accountants, and financial advisors.
“Securities Act”
—the Securities Act of 1933,
as amended, or any successor law, and regulations and rules issued
pursuant to thereto.
“Subsidiary”
—with respect to any Person
(the “Owner”), any corporation or other Person of which
securities or other interests having the power to elect a majority
of that corporation’s or other Person’s board of
directors or similar governing body, or otherwise having the power
to direct the business and policies of that corporation or other
Person (other than securities or other interests having such power
only upon the happening of a contingency that has not occurred) are
held by the Owner or one or more of its Subsidiaries; when used
without reference to a particular Person, “Subsidiary”
means a Subsidiary of the Company.
“Tax Return”
—any return (including any
information return), report, statement, schedule, notice, form, or
other document or information filed with or submitted to, or
required to be filed with or submitted to, any Governmental Body in
connection with the determination, assessment, collection, or
payment of any Tax or in connection with the administration,
implementation, or enforcement of or compliance with any Legal
Requirement relating to any Tax.
“Threatened”
—a claim, Proceeding, dispute,
action, or other matter will be deemed to have been
“Threatened” if any demand or statement has been made
(orally or in writing) or any notice has been given (orally or in
writing), or if any other event has occurred or any other
circumstances exist, that would lead a prudent Person to conclude
that such a claim, Proceeding, dispute, action, or other matter is
likely to be asserted, commenced, taken, or otherwise pursued in
the future.
SECTION
2. ISSUANCE OF BUYER’S STOCK AND PROMISSORY NOTE;
ISSUANCE OF UNITS; CLOSING
(a) Subject to the terms and conditions of this
Agreement, at the Closing, the Buyer shall issue and deliver to the
Company:
(i) Certificates representing Three Million
(3,000,000) authorized and newly issued Buyer’s Shares as set
forth in herein;
(ii) a Promissory Note for the payment of Two
Million Dollars ($2,000,000) to Company on the schedule set forth
in therein;
(b) Subject to the terms and conditions of this
Agreement, at the Closing, the Company shall issue and deliver to
Buyer a certificate representing 11,868 authorized and newly issued
Units (“Purchased Units”), as further described
herein.
The parties hereby adopt as of the date of this
Agreement a plan of exchange, a copy of which is attached hereto as
Exhibit “2.2” (the “Plan of
Exchange”).
The issuance and exchange (the
“Closing”) provided for in this Agreement will take
place at the offices of Company at 15858 West Dodge Road, Omaha,
Nebraska 68118, at 9:00 a.m. (local time) January19, 2006 or at
such other time and place as the parties may agree. Subject to the
provisions of Section 9, failure to consummate the purchase and
sale provided for in this Agreement on the date and time and at the
place determined pursuant to this Section 2.3 will not result in
the termination of this Agreement and will not relieve any party of
any obligation under this Agreement.
(a) The Company will deliver to
Buyer:
(i) A copy of a consent in lieu of a special
meeting of the majority member(s) of the Company approving this
Agreement and the transactions contemplated hereunder, approved by
a majority of the percentage interests of the members and the
manager;
(ii) An employment agreement executed by the
Company’s Manager in such form as may be mutually
satisfactory to the respective parties thereto (collectively,
“Employment Agreement”).
(b) Buyer will deliver to the
Company:
(i) A duly executed Voting Proxy enabling Mr.
Steven Campisi to vote the Purchased Units as described in such
Voting Proxy;
(ii) A copy of a Consent in Lieu of a Special
Meeting of the Buyer’s Board of Directors approving this
Agreement and the transactions contemplated hereunder, certified by
the Buyer’s President; and
(iii) The Employment Agreement, executed by
Buyer.
SECTION
3. REPRESENTATIONS AND WARRANTIES OF
COMPANY
The Company represents and warrants to Buyer as
follows:
3.1 ORGANIZATION; GOOD STANDING;
SUBSIDIARIES
(a) The Company is a limited liability company
duly organized, validly existing, and in good standing under the
laws of the State of Nebraska, with full power and authority to
conduct its business as it is now being conducted, to own or use
the properties and assets that it purports to own or use, and to
perform all its obligations under Applicable Contracts.
(b) The Company has delivered to Buyer copies of
the Organizational Documents of the Company, as currently in
effect.
(c) The Company has no Subsidiaries.
3.2 AUTHORITY; NO
CONFLICT
(a) This Agreement constitutes the legal, valid,
and binding obligation of Company, enforceable against Company in
accordance with its terms. Upon the execution and delivery by the
Company of the Employment Agreements signed by each respective
employee described in Part 2.4 (a) (ii), the Plan of Exchange and
the certified Resolution (collectively, the “Company’s
Closing Documents”), the Company’s Closing Documents
will constitute the legal, valid, and binding obligations of
Company, enforceable against Company in accordance with their
respective terms. Company has the absolute and unrestricted right,
power, authority, and capacity to execute and deliver this
Agreement and the Company’s Closing Documents and to perform
their obligations under this Agreement and the Company’s
Closing Documents.
(b) To the knowledge of the Company, neither the
execution and delivery of this Agreement nor the consummation or
performance of any of the Contemplated Transactions will, directly
or indirectly (with or without notice or lapse of time):
(i) contravene, conflict with, or result in a
violation of (A) any provision of the Organizational Documents
of the Company, or (B) any resolution adopted by the board of
directors of the Company;
(ii) contravene, conflict with, or result in a
violation of, or give any Governmental Body or other Person the
right to challenge any of the Contemplated Transactions or to
exercise any remedy or obtain any relief under, any Legal
Requirement or any Order to which the Company, or any of the assets
owned or used by the Company, may be subject;
(iii) contravene, conflict with, or result in a
violation of any of the terms or requirements of, or give any
Governmental Body the right to revoke, withdraw, suspend, cancel,
terminate, or modify, any Governmental Authorization that is held
by the Company or that otherwise relates to the business of, or any
of the assets owned or used by, the Company;
(iv) contravene, conflict with, or result in a
violation or breach of any provision of, or give any Person the
right to declare a default or exercise any remedy under, or to
accelerate the maturity or performance of, or to cancel, terminate,
or modify, any Applicable Contract; or
(v) Result in the imposition or creation of any
Encumbrance upon or with respect to any of the assets owned or used
by the Company.
(c) To the knowledge of the Company, the Company
is not or will not be required to give any notice to or obtain any
Consent from any Person in connection with the execution and
delivery of this Agreement or the consummation or performance of
any of the Contemplated Transactions.
The issued equity securities of the Company
consist of 11,867 Units of Membership Interests, comprised of (a)
8,788 Class “A” Units, (b) 746 Class “B”
Units and (c) 2,333 Class “C” Units. To the
Company’s Knowledge, the Members are the record and
beneficial owners and holders of the Units as set forth at Schedule
“A” hereto. All of the outstanding equity securities of
the Company have been duly authorized and validly issued and are
fully paid and nonassessable. Except as disclosed to Buyer
in the case of the holder of Class “C” Membership
Interest Units and that certain Memorandum of Understanding, dated
May 23, 2005 between Richard Quaknine and the Company, there are no
Contracts, warrants, options, rights, subscriptions or similar
agreements relating to the issuance, sale, or transfer of any
equity securities or other securities of the Company . To
the knowledge of the Company, None of the outstanding equity
securities or other securities of the Company was issued in
violation of the Securities Act or any other Legal Requirement. The
Company does not own, or have any Contract to acquire, any equity
securit
