Agreement and Plan of Merger - Medix Resources Inc., Cymedix Lynx Corp., and Automated Design Concepts Inc.
EXECUTION COPY
AGREEMENT AND PLAN OF MERGER
This Agreement and Plan of Merger is entered into as of March 8, 2000 by
and among Medix Resources, Inc., a Colorado corporation (Medix), Cymedix Lynx
Corporation, a Colorado corporation wholly owned by the Company (Cymedix) and
Automated Design Concepts, Inc., a New Jersey corporation (the ADC), and
joined in by David R. Pfeil (the ADC Shareholder).
The parties wish to effect the merger of ADC with and into Cymedix on the
terms and conditions hereof (the Merger). By approving resolutions authorizing
the Merger, Cymedix and ADC wish to adopt this Agreement as a plan of
reorganization within the meaning of Section 368(a) of the Internal Revenue Code
of 1986, as amended (the Code), and the regulations thereunder, and to cause
the Merger to qualify as a reorganization under the provisions of Section
368(a)(1)(A) of the Code.
Accordingly, in consideration of the representations and covenants set
forth herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:
1.The Merger
1.1 The Merger. At the Effective Time (as defined in Section 1.2) and
subject to and upon the terms and conditions of this Agreement and the
applicable provisions of the Colorado Business Corporation Act (the Colorado
Act) and the New Jersey Business Corporation Act (the New Jersey Act), ADC
shall be merged with and into Cymedix, the separate corporate existence of ADC
shall cease, and Cymedix shall continue as the surviving company. Cymedix as the
surviving company after the Merger is sometimes referred to herein as the
ASurviving Company.
1.2 Effective Time. Subject to the provisions of this Agreement, the
parties hereto shall cause the Merger to be consummated by filing a Certificate
of Merger in substantially the form attached as Exhibit A-1 (the New Jersey
Certificate of Merger) with the Secretary of the State of the State of New
Jersey in accordance with the relevant provisions of the New Jersey Act and a
Certificate of Merger in substantially the form attached hereto as Exhibit A-2
(the Colorado Certificate of Merger) with the Secretary of State of the State
of Colorado in accordance with the relevant provisions of the Colorado Act. The
time of filing the Colorado Certificate of Merger is referred to herein as the
Effective Time, and the date on which the Effective Time occurs is sometimes
referred to herein as the Effective Date.
1.3 Closing. The closing of the Merger (the Closing) shall take place
at the offices of Cymedix at a time and date to be specified by the parties,
which shall be as soon as practicable after the satisfaction or waiver of the
conditions set forth in Articles 6 and 7 or at such other time, date and
location as the parties hereto agree in writing (the Closing Date). At the
Closing,
(a) Cymedix shall deliver to ADC the various certificates and
instruments required under Article 7,
(b) ADC shall deliver to Cymedix the various certificates and
instruments required under Article 6 and
(c) Cymedix and ADC shall execute and file the Colorado Certificate
of Merger with the Secretary of State of the State of Colorado and the New
Jersey Certificate of Merger with the Secretary of State of the State of New
Jersey.
1.4 Effect of the Merger. At the Effective Time, the effect of the Merger
shall be as provided in this Agreement and the applicable provisions of the
Colorado Act and the New Jersey Act.
1.5 Governing Documents; Directors and Officers. At the Effective Time,
the Certificate of Incorporation and the Bylaws of Cymedix (the Cymedix
Governing Documents), each as in effect immediately prior to the Effective
Time, shall be the governing documents of the Surviving Company. The directors
and officers of the Surviving Company shall be the directors and officers of
Cymedix in office immediately prior to the Effective Time, to serve until their
respective successors are duly elected or appointed and qualified.
1.6 Conversion of ADC Stock. At the Effective Time, by virtue of the
Merger and without any action on the part of any party, the following shall
occur:
(a) Conversion. All shares of common stock, no par value, of ADC (the
ADC Stock) issued and outstanding immediately prior to the Effective Time will
be automatically converted into and become the right to receive
(i) $100,000 in cash (the Merger Cash) and (ii) 60,400 shares (the Merger
Shares) of common stock, $.001 par value, of Medix (Common Stock). The
certificate representing the Merger Shares shall be registered in the name of
the ADC Shareholder and shall bear a legend reflecting the restricted status of
the Merger Shares under the Securities Act of 1933, as amended (the Securities
Act).
(b) Adjustments to Merger Consideration. The Merger Cash and Merger
Shares issuable to the ADC Shareholder on conversion of the ADC Stock
(collectively, the Merger Consideration) shall not be subject to any
adjustment except in the event of any stock split, reverse stock split, stock
dividend (including any dividend or distribution of securities convertible into
Common Stock), recapitalization or other like change without receipt of
consideration with respect to the Common Stock occurring on or after the date
hereof and prior to the Effective Time (a Recapitalization), in which event
the number of Merger Shares shall be adjusted appropriately to reflect the
Recapitalization.
1.7 Payment of Merger Consideration. On the Closing Date, ADC shall
deliver to Cymedix properly endorsed certificates representing all of the issued
and outstanding shares of ADC Stock, and Medix shall deliver the Merger
Consideration to the ADC Shareholder. The certificates representing the ADC
Stock surrendered at the Closing (together with any treasury stock of ADC) shall
be canceled.
1.8 Maintenance of Medical Insurance. Cymedix shall continue to maintain
ADC's existing medical insurance policy for the benefit of the ADC Employees (as
defined in Section 6.3) at all times after the Effective Time until comparable
coverage is obtained for their benefit after December 31, 2000.
1.9 Taking of Necessary Action; Further Action. At any time after the
Effective Time, if any further action is necessary or desirable to carry out the
purposes of this Agreement and to vest Cymedix with full right, title and
possession to all assets, property, rights, privileges, powers and franchises of
ADC, the officers and directors of ADC and Cymedix are fully authorized in the
name of their respective companies or otherwise to take, and will take, all such
lawful and necessary action, as long as such action is consistent with this
Agreement.
2. Representations and Warrantees of ADC and the ADC
Shareholder. ADC and the ADC Shareholder represent and warrant to Cymedix as
follows:
2.1 Organization. ADC is a corporation duly organized, validly existing
and in good standing under the laws of the State of New Jersey and has the
corporate power to own, lease and operate its property and to carry on its
business as now conducted.
2.2 Capital Structure and Ownership.
(a) The authorized capital stock of ADC consists of 2,500 shares of
common stock, no par value, of which there are 100 shares issued and outstanding
on the date hereof. All outstanding shares of ADC Stock are duly authorized,
validly issued, fully paid and non-assessable and are not subject to preemptive
rights created by statute, the Certificate of Incorporation or Bylaws of ADC or
any agreement or document to which ADC is a party or by which it is bound.There
are no outstanding warrants, options, rights, phantom stock rights, agreements,
convertible or exchangeable securities or other instruments or commitments
pursuant to which ADC is or may become obligated to issue, sell, purchase,
return or redeem any shares of its capital stock or other securities or
(b) that give any person the right toreceive any benefits or rights
similar to any rights enjoyed by or accruing to the holders of shares of ADC
Stock or other interests of ADC. There are no outstanding bonds, debentures,
notes or other indebtedness having the right to vote on any matters on which
shareholders of ADC may vote.
(c) The ADC Shareholder is the lawful beneficial owner of the ADC
Stock, all of which is registered in his name on the stock records of ADC. The
ADC Shareholder has good and marketable title to the ADC Shares and has the full
right to transfer title to thereto, free and clear of any liens, claims,
encumbrances, security interests, options, charges and restrictions of any kind.
Other than this Agreement, the ADC Shares are not subject to any agreement,
arrangement, commitment or understanding that could impair Cymedix=s rights
thereto.
(d) The ADC Shareholder
(i) is an Aaccredited investor, as defined in Rule 501 under the
Securities Act,
(ii) have received, reviewed and considered all information deemed
relevant in making an informed decision about accepting the Merger Shares as
part of the Merger Consideration,
(iii) will acquire the Merger Shares for investment and with no present
intention of distributing or reselling them and
(iv) is aware that the Merger Shares
(A) will be deemed to be Arestricted securities for purposes of the
Securities Act and
(B) may not be sold or otherwise transferred in the absence of an
exemption from the registration requirements of the Securities Act and
applicable state securities laws.
2.3 Authority. ADC has all requisite corporate power and authority to
enter into 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 authorized by all necessary
corporate action on the part of ADC, subject only to the filing and recording of
the New Jersey Certificate of Merger pursuant to the New Jersey Act and the
Colorado Certificate of Merger pursuant to the Colorado Act. This Agreement has
been duly executed and delivered by ADC and the ADC Shareholder, and assuming
the due authorization, execution and delivery by Medix and Cymedix, constitutes
the valid and binding obligation of ADC and the ADC Shareholder, enforceable in
accordance with its terms.
2.4 No Conflict.
(a) Except as set forth in Schedule 2.4, the execution and delivery of
this Agreement by ADC do not, and the performance of this Agreement
by ADC will not,
(i) conflict with or violate the Certificate of Incorporation or Bylaws
of ADC,
(ii) subject to compliance with the requirements set forth in Section
2.4(b) below, conflict with or violate any law, rule, regulation, order,
judgment or decree applicable to ADC or by which its properties are bound, or
(iii) result in any breach of or constitute a default (or an event that
with notice or lapse of time or both would become a default) under, or impair
the rights of ADC or alter the rights or obligations of any third party
under, or give to others any rights of termination, amendment, acceleration
or cancellation of, or result in the creation of a lien or encumbrance
on any of the properties or assets of ADC pursuant to, any note, bond,
mortgage, indenture, contract, agreement, lease, license, permit,
franchise or other instrument or obligation to which ADC is a party or by which
ADC or its properties are bound or affected.
(b) No consent, approval, order or authorization of, or registration,
declaration or filing with any court, administrative agency or commission or
other governmental or regulatory body or authority or instrumentality
(Governmental Authority) is required by or with respect to ADC in connection
with the execution and delivery of this Agreement or the consummation of the
transactions contemplated, except for the filing of the Colorado Certificate of
Merger with the Secretary of State of Colorado and the New Jersey Certificate of
Merger with the Secretary of State of the State of New Jersey.
(c) ADC has heretofore delivered to the Company true and complete
copies of its Certificate of Incorporation and Bylaws, each as amended to date,
and minute books, including its stock certificate ledger and stock transfer
books.
2.5 Financial Statements; Undisclosed Liabilities.
(a) The unaudited financial statements of ADC for the year ended
December 31, 1999 heretofore delivered to Cymedix comply as to form in all
material respects with applicable accounting requirements, were prepared in
accordance with generally accepted accounting principles (GAAP) applied on a
consistent basis during the period involved (except as may be indicated in the
notes thereto) and fairly present the financial position of ADC as of the date
thereof and its results of operations for the period then ended.
(b) ADC does not have any material liabilities or obligations of any
nature (whether accrued, absolute, contingent, unasserted or otherwise), except
(i) as disclosed, reflected or fully reserved against in its balance
sheet as of February 25, 2000 (the ADC Balance Sheet) and any notes thereto,
(ii) for items set forth in Schedule 2.5 and iii) for liabilities and
obligations incurred in the ordinary course of business consistent with past
practice since the date of the ADC Balance Sheet and not in violation of this
Agreement or in excess of $5,000 in the aggregate.
(c) Except as set forth in Schedule 2.5,
(i) ADC has filed or caused to be filed in a timely manner (within any
applicable extension periods) all tax returns, reports and forms required to be
filed by the Internal Revenue Code (the Code) or by applicable state, local or
foreign tax laws,
(ii) all taxes required to be paid by ADC have been timely paid in full
and all taxes for current periods are adequately provided for, and
(iii) no tax liens have been filed and no material claims are being
asserted in writing with respect to any taxes. The federal income tax returns
filed by ADC have never been examined by the Internal Revenue Service.
2.6 Assets.
(a) ADC has good and valid title to all assets reflected on
the ADC Balance Sheet, in each case free and clear of all mortgages, liens,
security interests or encumbrances of any kind except as set forth in Schedule
2.6 (the Scheduled Liens).
(b) All the material tangible personal property of ADC has been
maintained in all material respects in accordance with good commercial
practices. Each item of material tangible personal property of ADC is in all
material respects in good operating condition and repair, ordinary wear and tear
excepted. All leased personal property of ADC is in all material respects in the
condition required by the terms of the applicable lease during the term of the
lease and upon the expiration thereof.
2.7 Intellectual Property. Schedule 2.7 sets forth a true and complete
list of all intellectual property and proprietary rights, whether or not subject
to statutory registration or protection (collectively, ADC Intellectual
Property), owned, used, filed by or licensed to ADC. Except as set forth in
Schedule 2.7, ADC owns and has the right to use, execute, reproduce, display,
perform, modify, enhance, distribute, prepare derivative works of and
sublicense, without payment to any other person, all ADC Intellectual Property,
and the consummation of the transactions contemplated hereby will not conflict
with, alter or impair any of those rights. ADC has not granted any options,
licenses or agreements of any kind relating to the ADC Intellectual Property or
the marketing or distribution thereof, except for nonexclusive licenses to end
users in the ordinary course of business or as otherwise indicated in Schedule
2.7. Except as set forth in Schedule 2.7, ADC is not bound by or a party to any
options, licenses or agreements of any kind relating to the ADC Intellectual
Property. Subject to the rights of third parties set forth in Schedule 2.7, all
ADC Intellectual Property is free and clear of any third party claims and all
liens, security interests and encumbrances whatsoever, other than Scheduled
Liens. The conduct of the business of ADC has not violated, conflicted or
infringed and does not violate, conflict with or infringe the intellectual
property rights of any other person. Except as set forth in Schedule 2.7,
(i) no claims are pending or, to the knowledge of the ADC Shareholder,
threatened, against ADC by any person with respect to the ownership, validity,
enforceability, effectiveness or use of any ADC Intellectual Property and
(ii) since its inception, ACD has not received any communications alleging
that it has violated any rights relating thereto.
2.8 Contracts.
(a) Except as set forth in Schedule 2.8, ADC is not a party to or
bound by any of the following:
(i) employment or consulting agreement that has an aggregate future
liability in excess of $5,000 and is not by ADC upon notice of not more than 30
days for a cost of less than $5,000;
(ii) covenant of Cymedix not to compete or otherwise restricting the
operations of ADC;
(iii) lease or similar agreement with any person under which
(A) ADC is lessee of or holds or uses any machinery, equipment, vehicle
or other tangible personal property owned by any other person or
(B) ADC is a lessor or sublessor of, or makes available for use by any
other person, any tangible personal property owned or leased by ADC;
(iv)
(A) continuing contract for the future purchase of
materials, supplies or equipment,
(B) management, service, consulting or other similar type of contract or
(C) advertising agreement or arrangement;
(v)material license, option or other agreement relating in whole
or in part to
(A) the ADC Intellectual Property, including any license or other
agreement under which ADC is licensee or licensor thereof, or
(B) trade secrets, confidential information or other proprietary rights of
ADC;
(vi) agreement, contract or other instrument under which ADC has
borrowed any money from, or issued any note, bond, debenture or other evidence
of indebtedness to, any other person;
(viii) agreement, contract or other instrument under which
(A) any person has directly or indirectly guaranteed indebtedness,
liabilities or obligations of ADC or
(B) ADC has directly or indirectly guaranteed indebtedness,
liabilities or obligations of any other person;
(ix) agreement, contract or other instrument under which ADC has,
directly or indirectly, made any advance, loan, extension of credit or capital
contribution to, or other investment in, any other person;
(x)agreement, contract or other instrument providing for
indemnification of any person with respect to liabilities relating to any
current or former business of ADC; or
(xi) other agreement, contract or other instrument to which ADC
is a party or by or to which it or any of its assets or business is bound or
subject that has an aggregate future liability to any other person in excess of
$5,000 and is not terminable by ADC upon notice of not more than 300 days for a
cost of less than $5,000.
(b) Except as set forth in Schedule 2.8, all agreements, contracts or
other instruments of ADC listed or required to be listed in the Schedules hereto
(collectively, the AADC Contracts@) are valid, binding and in full force and
effect and are enforceable by ADC in accordance with its terms. Except as set
forth in Schedule 2.8, ADC has performed all material obligations required to be
performed by it to date under the ADC Contracts and it is not in breach or
default in any material respect thereunder (with or without the lapse of time or
the giving of notice, or both) nor has any other party to any of the ADC
Contracts notified ADC of that party=s belief that ADC is or is likely to become
in breach or default in any material respect thereunder or of that party=s
intention to accelerate or modify in a manner adverse to ADC any of its
obligations or rights thereunder and, to the knowledge of the ADC Shareholder,
no other party to any of the ADC Contracts is in breach or default in any
material respect thereunder (with or without the lapse of time or the giving of
notice, or both).
2.9 Litigation. Schedule 2.9 sets forth a list of all pending lawsuits or
claims against or affecting ADC or any of its properties, assets, operations or
business. Except as set forth in Schedule 2.9,
(a) none of the lawsuits or claims listed therein would have a material
adverse affect on ADC if determined adversely to ADC, individually or in the
aggregate,
(b) ADC is not a party or subject to or in default under any judgment,
order, injunction or decree of any Governmental Authority or arbitration
tribunal applicable to it or any of its properties, assets, operations or
business,
(iii) there is no lawsuit or claim by ADC pending, or which ADC intends to
initiate, against any other person and
(iv) to the knowledge of the ADC Shareholder, there is no pending or
threatened investigation of or affecting ADC by any Governmental Authority.
2.10 Insurance. ADC maintains policies of fire and casualty, liability and
other forms of insurance in amounts, with deductibles and against risks and
losses that are, in its judgment, reasonable for the business and assets of ADC.
The insurance policies maintained by ADC are listed in Schedule 2.10. Except as
set forth in Schedule 2.10, all of the policies listed therein are in full force
and effect, all premiums due and payable thereon have been paid (other than
retroactive or retrospective premium adjustments that are not yet, but may be,
required to be paid with respect to any period ending prior to the Effective
Date under comprehensive general liability and workmen=s compensation insurance
policies), and no notice of cancellation or termination has been received with
respect thereto. The activities and operations of ADC have been conducted in a
manner conforming in all material respects to all applicable provisions of its
insurance policies.
2.11 Benefit Plans.
(a) Schedule 2.11 sets forth a list and brief description of all
benefit plans maintained by ADC for the benefit of any of its employees. ADC
has heretofore delivered to Cymedix true, complete and correct copies of
(i) each benefit plan,
(ii) the most recent annual report on Form 5500 filed with the Internal
Revenue Service with respect to each benefit plan (if required),
(iii) the most recent summary plan description for each benefit plan
for which a summary plan description is required and
(iv) each trust agreement, group annuity contract and other financing and
funding arrangement relating to any benefit plan.
(b) Each benefit plan maintained by ADC has been administered in all
material respects in accordance with its terms and applicable law. There are no
lawsuits, actions, termination proceedings or other proceedings pending or, to
the knowledge of the ADC Shareholder, threatened against or involving any of
ADC's benefit plans and no investigations by any Governmental Authority or other
claims (except claims for benefits payable in the normal operation of the
benefit plans) pending or threatened against or involving any of its benefit
plans.
2.12 Absence of Changes or Events. Except as set forth in Schedule 2.12,
(a) since the date of the ADC Balance Sheet, there has not occurred any
event or events or arisen any change of affairs that, individually or
in the aggregate, has had or could have a material adverse effect,
(b) since the date of the ADC Balance Sheet, the business of ADC has been
conducted in the ordinary course and in substantially the same manner as
previously conducted,
(c) ADC has made all reasonable efforts consistent with past practices to
adhere to preserve its relationships with customers, suppliers and others with
whom it deals, and
(d) from the date of the ADC Balance Sheet, ADC has not taken any action
that, if taken after the date of this Agreement, would constitute a breach of
any of its covenants set forth herein.
2.13 Compliance with Applicable Laws. Except as set forth on Schedule
2.13, ADC is in compliance in all material respects with all applicable
statutes, laws, ordinances, rules, orders and regulations of any Governmental
Authority applicable to its business and operations.
2.14 Disclosure. No representation or warranty of ADC or the ADC
Shareholder contained in this Agreement, no statement contained in any document,
certificate or Schedule and no data provided in connection with the due
diligence investigation contemplated by Section 6(a) furnished or to be
furnished by or on behalf of ADC to the Cymedix or any of its representatives
pursuant to this Agreement contains or will contain any untrue statement of a
material fact or omits or will omit to state any material fact necessary, in
light of the circumstances under which it was or will be made, in order to make
the statements herein or therein not misleading or necessary to fully and fairly
provide the information required to be provided therein.
3. Representations and Warrantees of Medix and Cymedix. Medix and
Cymedix represent and warrant to ADC as follows:
3.1 Organization. Cymedix is a corporation duly organized, validly
existing and in good standing under the laws of the State of Colorado, is (or
shall be prior to the Effective Time) duly qualified to do business and in good
standing as a foreign corporation in the State of New Jersey, and has the power
to own, lease and operate its property and to carry on its business as now
conducted.
3.2 Authority.
(a) Each of Medix and Cymedix has all requisite power and authority to
enter into 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 authorized by all
necessary action on the part of Medix and Cymedix, subject only to the
filing and recording of the New Jersey Certificate of Merger pursuant to
the New Jersey Act and the Colorado Certificate of Merger pursuant to the
Colorado Act. This Agreement has been duly executed and delivered by Medix
and Cymedix and, assuming the due authorization, execution and delivery of
this Agreement by ADC, constitutes the valid and binding obligation of
Medix and Cymedix, enforceable in accordance with its terms.
(b) The Merger Shares have been duly authorized by all requisite
corporate action of Medix and shall, upon issuance, be validly issued, fully
paid and nonassessable. Upon delivery to the ADC Shareholder of certificates
representing the Merger Shares, they will acquire good and valid title to their
Merger Shares, free and clear of any liens, claims, encumbrances, security
interests, options, charges and restrictions of any kind, other than those
arising from their own acts or omissions. Other than this Agreement, the Merger
Shares are not subject to any agreement, arrangement, commitment or
understanding, including any restriction relating to the voting, dividend rights
or disposition of the Merger Shares. No stock transfer taxes will be due in the
State of Colorado as a result of the issuance of the Merger Shares.
(c) The Board of Directors of Medix has taken (or shall take by the
Effective Time) all action necessary to approve the issuance of the Merger
Shares pursuant to the Merger. No anti-takeover or similar statute or regulation
applies or purports to apply to the transactions contemplated by this Agreement.
3.3 No Conflict.
(a) The execution and delivery of this Agreement by Medix and Cymedix
do not, and the performance of this Agreement by them will not,
(i) conflict with or violate the their respective certificates of
incorporation or bylaws,
(ii) subject to compliance with the requirements set forth in Section
3.3(b) below, conflict with or violate any law, rule, regulation, order,
judgment or decree applicable to them or by which their properties are
bound or affected, or
(iii) result in any breach of or constitute a default (or an event that
with notice or lapse of time or both would become a default) under, or impair
their respective rights or alter the rights or obligations of any third
party under, or give to others any rights of termination, amendment,
acceleration or cancellation of, or result in the creation of a lien or
encumbrance on any of their properties or assets pursuant to, any note, bond,
mortgage, indenture, contract, agreement, lease, license, permit, franchise
or other instrument or obligation to which either of them is a party or by which
their properties are bound or affected.
(b) No consent, approval, order or authorization of, or registration,
declaration or filing with any Governmental Authority is required by or with
respect to Medix or Cymedix in connection with the execution and delivery of
this Agreement or the consummation of the transactions contemplated hereby,
except for the filing of the Colorado Certificate of Merger with the Secretary
of State of Colorado and the New Jersey Certificate of Merger with the Secretary
of State of the State of New Jersey.
4.Indemnities
4.1 Survival of Representations. All representations and warranties made
by the parties hereunder shall survive the Effective Date until the first
anniversary thereof (the Survival Date). ADC shall have the continuing
obligation until the Closing promptly to supplement or amend the Schedules
delivered hereunder with respect to any matter hereafter arising or discovered
that, if existing or known at he date of this Agreement, would have been
required to be set forth or described in the Schedules hereto.
4.2 ADC Shareholder Indemnity.
(a) The ADC Shareholder agrees to indemnify and hold harmless
Cymedix from and against all losses, liabilities, claims, damages, costs and
expenses, including reasonable attorneys fees (collectively, Losses and
individually, a Loss) that Cymedix may sustain arising out of any breach by
ADC or the ADC Shareholder of any of their representations, warranties or
covenants in this Agreement. Cymedix shall promptly notify the ADC
Shareholder of the existence of any third party claim, demand or other matter
to which the indemnification obligations of the ADC Shareholder would apply.
The ADC Shareholder shall be entitled, at his expense and with counsel
reasonably acceptable to Cymedix, to assume and conduct the defense of the
claim. If the ADC Shareholder does not undertake the defense of the claim, or
if he has a conflict of interest with respect to the claim, Cymedix shall be
entitled to retain separate counsel reasonably acceptable to the ADC
Shareholder, at the expense of the ADC Shareholder, to conduct the defense.
(b) The ADC Shareholder shall continue to defend and shall bear all
Losses associated with a pending litigation captioned Dezine Healthcare
Solutions, Inc. vs. David R. Pfeil d/b/a Arrow Professional Enterprises and
d/b/a Automated Design Concepts (Docket No. C 80-99, Middlesex County, New
Jersey.
4.3 Cymedix Indemnity. Cymedix agrees to indemnify and hold harmless the
ADC Shareholder from and against all Losses that the ADC Shareholder may sustain
arising out of any breach by Medix or Cymedix of any of their representations,
warranties or covenants in this Agreement. The ADC Shareholder shall promptly
notify Cymedix of the existence of any third party claim, demand or other matter
to which the indemnification obligations of Cymedix would apply. Cymedix shall
be entitled, at its expense and with counsel reasonably acceptable to the ADC
Shareholder, to assume and conduct the defense of the claim. If Cymedix does not
undertake the defense of the claim, or if it has a conflict of interest with
respect to the claim, the ADC Shareholder shall be entitled to retain separate
counsel reasonably acceptable to the Cymedix, at the expense of Cymedix, to
conduct the defense.
5.Conduct of Business Pending Closing
5.1 Conduct of Operations. ADC agrees, from the date of this Agreement to
the Closing, and unless otherwise approved in advance in writing by Cymedix, it
will conduct its business in the ordinary and usual courses of business and
shall maintain its books of account in a manner that fairly and correctly
reflects its income, expenses, assets and liabilities in accordance with GAAP.
5.2 Preservation of Representations. Prior to the Closing, ADC shall not
take any action that
(a) if taken on or before the date hereof, would make untrue any of
the representations and warranties contained in Article 2 or
(b) would interfere with the ability of Medix or Cymedix to perform this
Agreement.
5.3 Procuring Approvals. ADC shall use its best efforts to obtain all
licenses, consents or other approvals required to be obtained from any financial
institution or other person in connection with the consummation of the
transactions contemplated by this Agreement.
6. Conditions to Obligations of Medix and Cymedix.The obligations of Medix
and Cymedix under this Agreement are subject to the following conditions, any of
which may be waived in writing in whole or in part by Cymedix.
6.1 No Material Breaches. There shall not have been any material breach
of the representations, warranties, covenants and agreements of ADC or the ADC
Shareholder contained in this Agreement, and all of their representations and
warranties shall be true as of the Closing Date, except to the extent that they
are expressly stated to be true as of some other time.
6.2 Compliance with Entire Agreement. ADC shall have performed and
complied with all agreements and conditions required by this Agreement to be
performed or complied with by it.
6.3 Employment Agreements. The employees of ADC listed on Schedule 6.3
(the ADC Employees) shall have entered into employment agreements with Cymedix
in form and substance acceptable to Cymedix.
6.4 Certain Consents Obtained. ADC shall have obtained any required
written consents of any third parties whose consent is required to the
transactions contemplated by this Agreement.
6.5 Indebtedness. On the Effective Date, the outstanding indebtedness and
accounts payable of ADC, net of accounts receivable, shall not exceed $40,000 in
the aggregate.
6.6 Further Assurances. ADC or the ADC Shareholder shall have delivered
to Cymedix any documents and further assurances that it may reasonably request
to memorialize the transactions contemplated hereby or to confirm the
satisfaction of the conditions set forth in this Article 6.
7. Conditions to Obligations of ADC. The obligations of ADC under this
Agreement are subject to the following conditions, any of which may be waived in
writing in whole or in part by ADC.
7.1 No Material Breaches. There shall not have been any material breach
of the representations, warranties, covenants and agreements of the Medix and
Cymedix contained in this Agreement, and all of its representations and
warranties shall be true as of the Closing Date, except to the extent that they
are expressly stated to be true as of some other time.
7.2 Compliance with Entire Agreement. Medix and Cymedix shall have
performed and complied with all agreements and conditions required by this
Agreement to be performed or complied with by them.
7.3 Employment Agreements. Cymedix shall have entered into employment
agreements with the ADC Employees in form and substance acceptable to them.
7.4 Office Lease. Cymedix shall have entered into a two-year lease for
the office space currently leased by ADC at 72 Brunswick Woods Drive, East
Brunswick, New Jersey 08816 on terms acceptable to the ADC Shareholder.
7.5 Further Assurances. Cymedix shall have delivered to the ADC
Shareholder any documents and further assurances that he may reasonably request
to memorialize the transactions contemplated hereby or to confirm the
satisfaction of the conditions set forth in this Article 7.
8.Termination
8.1 Cymedix Termination. This Agreement may be terminated by Cymedix and
the transactions contemplated hereby abandoned at any time prior to the Closing
if ADC shall have failed to satisfy any of the conditions set forth in Section 6
or any of those conditions shall have become incapable of fulfillment and shall
not have been waived by Cymedix.
8.2 ADC Termination. This Agreement may be terminated by ADC and the
transactions contemplated hereby abandoned at any time prior to the Closing if
Medix or Cymedix shall have failed to satisfy any of the conditions set forth in
Section 7 or any of those conditions shall have become incapable of fulfillment
and shall not have been waived by ADC.
8.3 Other Termination Events. This Agreement may be terminated and the
transactions contemplated hereby abandoned by Cymedix or ADC if the Closing does
not occur within 30 days of the date hereof, provided that the party seeking
termination pursuant to this Section 8.3 is not in breach in any of its material
representations, warranties, covenants or agreements contained in this
Agreement.
8.4 Notice of Termination. In the event a party seeks to terminate this
Agreement pursuant to this Section 8, it shall give written notice thereof to
the other party, setting forth in reasonable detail the grounds for termination,
whereupon the transactions contemplated by this Agreement shall be terminated
without further action by any party. In the event of termination, this Agreement
shall become void and of no further force or effect, except that each party
shall return all documents and other material received from or on behalf of the
other party in connection with the transactions contemplated hereby, whether so
obtained before or after the execution hereof. All confidential information
received by a party with respect to the business of the other party shall be
held in confidence notwithstanding any termination of this Agreement.
9. Miscellaneous
9.1 Benefit. This Agreement shall be binding upon and shall inure to the
benefit of the parties and their successors and permitted assigns.
9.2 Entire Agreement. This Agreement, including the Schedules and
Exhibits, contains the entire agreement and understanding among the parties
hereto with respect to the subject matter hereof and shall not be modified or
affected by any offer, proposal, statement or representation, oral or written,
made by or for any party in connection with the negotiation of the terms hereof.
There are no representations, promises, warranties, covenants, undertakings or
assurances (express or implied) other than those expressly set forth or provided
for herein and in the other documents referred to herein. This Agreement may not
be modified or amended orally, but only by a writing signed by all the parties
hereto.
9.3 Construction. Whenever the context requires, the gender of all words
used in this Agreement includes the masculine, feminine and neuter. The headings
and captions in this Agreement and the Schedules are for convenience and
identification only and are in no way intended to define, limit or expand the
scope and intent of this Agreement or any provision hereof.
9.4 Governing Law. This Agreement and all rights and obligations
hereunder shall be governed by, and construed in accordance with, the law of the
State of Colorado applicable to agreements made and to be performed wholly
within that State, without regard to the conflicts of laws principles of that
State.
9.5 Expenses. Each party hereto shall pay its own expenses incidental to
the preparation of this Agreement, the carrying out of the provisions of this
Agreement and the consummation of the transactions contemplated hereby.
9.6 Assignment. This Agreement may not be assigned by any party
without the prior written consent of the other parties.
9.7 Notices. All notices, requests, consents and demands by the parties
hereunder shall be delivered by hand, by recognized national overnight courier
or by deposit in the United States mail, postage prepaid, by registered or
certified mail, return receipt requested, addressed to the party to be notified
at the addresses set forth below:
(a) if to the Medix or Cymedix, to:
Medix Resources, Inc.
7100 E. Belleview Avenue B Suite 301
Englewood, CO 80111
Attention: President
With a copy to:
Cymedix Lynx Corporation
One Broadwalk B Suite 200
Thousand Oaks, CA 91360
Attention: Chairman
(b) if to ADC or the ADC Shareholder, to:
Automated Design Concepts, Inc.
72 Brunswick Woods Drive
East Brunswick, New Jersey 08816
New York, NY 10118
Attn: President
9.8 Non-waivers. Neither any failure nor any delay on the part of any
party to this Agreement in exercising any right, power or privilege hereunder
shall operate as a waiver of any rights of such party, unless such waiver is
made by a writing executed by the party and delivered to the other parties
hereto, nor shall a single or partial exercise of any right preclude any other
or further exercise of any other right, power or privilege accorded to any party
hereto.
9.9 Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed to be an original. It shall not be
necessary when making proof of this Agreement to account for more than one
counterpart.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the day
and year first above written.
MEDIX RESOURCES, INC.
By:___________________________________
John R. Prufeta,
President and Chief Executive Officer
CYMEDIX LYNX CORPORATION
By:___________________________________
John R. Prufeta,
President and Chief Executive Officer
AUTOMATED DESIGN CONCEPTS, INC.
By:___________________________________
David R. Pfeil,
President
By:-----------------------------------
David R. Pfeil
EXHIBIT A-1
CERTIFICATE OF MERGER
OF
AUTOMATED DESIGN CONCEPTS, INC.
INTO
CYMEDIX LYNX CORPORATION
(The Surviving Corporation)
To the Department of the Treasury
State of New Jersey
Pursuant to the provisions of Section 14A:10-7 of the New Jersey Business
Corporation Act, it is hereby certified that:
1. The names of the merging corporations are Automated Design Concepts,
Inc., a business corporation organized under the laws of the State of New
Jersey, and Cymedix Lynx Corporation, a business corporation organized under the
laws of the State of Colorado.
2.Annexed hereto as Annex A and made a part hereof is the Plan and
Agreement of Merger for merging Automated Design Concepts, Inc. with and into
Cymedix Lynx Corporation (the Plan of Merger), as approved by the board of
directors of each constituent corporation.
3.The number of shares of capital stock of Automated Design Concepts, Inc.
that were entitled to be voted at the time of approval of the Plan of Merger by
its shareholders is 100 shares, all of which are of one class and all of which
were voted for approval of the Plan of Merger by unanimous written consent dated
March 8, 2000.
4.The applicable provisions of the laws of the jurisdiction of Cymedix
Lynx Corporation relating to the merger of Automated Design Concepts, Inc. with
and into Cymedix Lynx Corporation will have been complied with upon compliance
with the filing requirements thereof.
5.Cymedix Lynx Corporation hereby agrees that it may be served with
process in the State of New Jersey in any proceeding for the enforcement of any
obligation of Automated Design Concepts, Inc. or any obligation of Cymedix Lynx
Corporation for which it is previously amenable to suit in the State of New
Jersey and in any proceeding for the enforcement of the rights of a dissenting
shareholder of Automated Design Concepts, Inc. against Cymedix Lynx Corporation;
and Cymedix Lynx Corporation hereby irrevocably appoints the Department of the
Treasury of the State of New Jersey as it agent to accept service of process in
any such proceeding and designates the following post office address outside the
State of New Jersey to which the Department of the Treasury of the State of New
Jersey shall mail a copy of the process in such proceeding:
Cymedix Lynx Corporation
One Boardwalk B Suite 200
Thousand Oaks, CA 91360
Attention: Chairman
6. Cymedix Lynx Corporation will continue its existence as the surviving
corporation under its present name pursuant to the laws of its jurisdiction of
organization.
Executed on this 14th day of March, 2000.
CYMEDIX LYNX CORPORATION
By:___________________________________
John R. Prufeta,
Chairman of the Board
AUTOMATED DESIGN CONCEPTS, INC.
By:___________________________________
David R. Pfeil,
President
ANNEX A
PLAN AND AGREEMENT OF MERGER
OF
AUTOMATED DESIGN CONCEPTS, INC.
(a New Jersey corporation)
INTO
CYMEDIX LYNX CORPORATION
(a Colorado corporation)
This Plan of Merger (the APlan of Merger@) was adopted on March 8, 2000 by
the board of directors of Automated Design Concepts, Inc., a business
corporation organized under the laws of the State of New Jersey (ADC), and by
the board of directors of Cymedix Lynx Corporation, a business corporation
organized under the laws of the State of Colorado (Cymedix).
1.Pursuant to the provisions of the New Jersey Business Corporation Act
(the New Jersey Act) and the provisions of the Colorado Business Corporation
Act (the Colorado Act), ADC shall merge (the Merger) with and into Cymedix,
which shall be the surviving corporation of the Merger.
2.Effective upon the filing of certificates of merger in accordance with
the New Jersey Act and the Colorado Act (the Effective Time), the separate
existence of ADC will cease, and Cymedix will be the surviving entity in the
Merger (the Surviving Company) and will continue to be governed by the laws of
the State of Colorado in accordance with the Colorado Act and the provisions of
its certificate of incorporation and bylaws, which shall continue in full force
and effect until amended in the manner prescribed by the Colorado Act.
3.The directors and officers of the Surviving Company shall be the
directors and officers of Cymedix in office immediately prior to the Effective
Time, to serve until their respective successors are duly elected or appointed
and qualified.
4.At the Effective Time, all of the issued and outstanding capital stock
of ADC will be converted into the right to receive, in the aggregate,
(a) cash in the amount of One Hundred Thousand Dollars ($100,000) and
(ii) 60,400 shares of common stock, $.001 par value, of Medix
Resources, Inc., the parent corporation of Cymedix. No other cash, rights or
securities will be issued in the Merger.
5.From and after the Effective Time,
(a) Cymedix shall possess all the rights, privileges, powers and franchises
of ADC and shall be subject to all the restrictions, disabilities and duties of
ADC,
(b) all of the rights, privileges, powers and franchises of ADC, and all
property and debts due to ADC on whatever account shall be vested in Cymedix,
(c) all property, rights, privileges, powers and franchises of ADC shall be
as effectually the property of Cymedix as they were of ADC, and the title to
any real estate vested by deed or otherwise in ADC shall not revert to or be in
any way impaired by reason of the Merger, and
(d) all rights of creditors and all liens upon any property of ADC
shall be preserved unimpaired, and all debts, liabilities and duties of ADC
shall attach to Cymedix and may be enforced against it to the same extent as if
those debts, liabilities and duties had been incurred or contracted by Cymedix.
6.The Merger shall have all the other effects provided by the New Jersey
Act and the Colorado Act.
7.The Plan of Merger shall be submitted to the shareholders of ADC for
their approval in the manner prescribed by the provisions of the New Jersey Act,
and the Merger shall be authorized in the manner prescribed by the provisions of
the Colorado Act.
8.ADC and Cymedix hereby stipulate that, upon approval of the Plan of
Merger by the shareholders of ADC entitled to vote thereon in the manner
prescribed by the provisions of the New Jersey Act and authorization of the
Merger in the manner prescribed by the provisions of the Colorado Act, they will
cause to be executed and filed any document prescribed by the provisions of the
New Jersey Act and the Colorado Act, and they will cause to be performed all
acts necessary to effectuate the Merger.
9.The proper officers of ADC and of Cymedix are hereby authorized,
empowered and directed to do any and all acts and to make, execute, deliver and
file any and all instruments and documents that shall be necessary or proper to
carry out or effect any of the provisions of the Plan of Merger. Each of the
parties will use all reasonable efforts to obtain any necessary waivers,
consents and approvals, effect all necessary filings and take all actions
necessary or appropriate to consummate the transactions contemplated by the Plan
of Merger.
10. Notwithstanding the approval of the Plan of Merger by the shareholders
of ADC entitled to vote thereon in the manner prescribed by the provisions of
the New Jersey Act and authorization of the Merger in the manner prescribed by
the provisions of the Colorado Act, the Merger may be abandoned at any time
prior to the effective time in the State of New Jersey in the event that either
party elects to do so.
AS APPROVED, ADOPTED AND EXECUTED BY EACH OF THE CONSTITUENT ENTITIES AND EACH
OF THE OTHER PARTIES TO THE MERGER AGREEMENT AS OF MARCH 8, 2000
EXHIBIT A-2
ARTICLES OF MERGER
OF
AUTOMATED DESIGN CONCEPTS, INC.
INTO
CYMEDIX LYNX CORPORATION
(The Surviving Corporation)
Pursuant to the provisions of Section 7-111-105 of the Colorado Business
Corporation Act (the Act), Cymedix Lynx Corporation, a Colorado corporation
incorporated on October 28, 1997, the surviving corporation (the Surviving
Corporation) in the merger described herein (the Merger), hereby represents
as follows:
1. Plan of Merger. The Plan and Agreement of Merger in the form annexed
hereto as Annex A, summarizing the principal terms of the Agreement and Plan of
Merger entered into as of March 8, 2000 among the Surviving Corporation,
Automated Design Concepts, Inc., a New Jersey corporation (ADC), and David R.
Pfeil, the sole shareholder of ADC (the Plan), has been approved and adopted
by the Surviving Corporation and ADC in accordance with the requirements of the
Act , the requirements of the laws of the State of New Jersey and the
requirements of the Plan.
2. Shareholder Approval. The shareholders of ADC were required to approve
the Plan, and the number of votes cast for approval of the Plan by each group
entitled to vote separately on the Merger were sufficient for approval of the
Plan by that voting group. The shareholder of the Surviving Corporation were not
required to approve the Plan pursuant to Section 7-111-103(7) of the Act.
3. Effective Date. The Merger shall take effect upon the filing of these
Articles of Merger with the office of the Secretary of State of the State of
Colorado and a Certificate of Merger relating to the Merger with the Secretary
of State of the State of New Jersey.
Executed on this 14th day of March, 2000
CYMEDIX LYNX CORPORATION
By:___________________________________
John R. Prufeta,
Chairman the Board
AUTOMATED DESIGN CONCEPTS, INC.
By:___________________________________
David R. Pfeil,
President
ANNEX A
PLAN AND AGREEMENT OF MERGER
OF
AUTOMATED DESIGN CONCEPTS, INC.
(a New Jersey corporation)
INTO
CYMEDIX LYNX CORPORATION
(a Colorado corporation)
This Plan of Merger (the Plan of Merger) was adopted on March 8, 2000 by
the board of directors of Automated Design Concepts, Inc., a business
corporation organized under the laws of the State of New Jersey (ADC), and by
the board of directors of Cymedix Lynx Corporation, a business corporation
organized under the laws of the State of Colorado (Cymedix).
1. Pursuant to the provisions of the New Jersey Business Corporation Act
(the New Jersey Act) and the provisions of the Colorado Business Corporation
Act (the Colorado Act), ADC shall merge (the Merger) with and into Cymedix,
which shall be the surviving corporation of the Merger.
2. Effective upon the filing of certificates of merger in accordance with
the New Jersey Act and the Colorado Act (the Effective Time), the separate
existence of ADC will cease, and Cymedix will be the surviving entity in the
Merger (the Surviving Company) and will continue to be governed by the laws of
the State of Colorado in accordance with the Colorado Act and the provisions of
its certificate of incorporation and bylaws, which shall continue in full force
and effect until amended in the manner prescribed by the Colorado Act.
3.The directors and officers of the Surviving Company shall be the
directors and officers of Cymedix in office immediately prior to the Effective
Time, to serve until their respective successors are duly elected or appointed
and qualified.
4. At the Effective Time, all of the issued and outstanding capital stock
of ADC will be converted into the right to receive, in the aggregate,
(a) cash in the amount of One Hundred Thousand Dollars ($100,000) and
(ii) 60,400 shares of common stock, $.001 par value, of Medix Resources,
Inc., the parent corporation of Cymedix. No other cash, rights or securities
will be issued in the Merger.
5. From and after the Effective Time,
(a) Cymedix shall possess all the rights, privileges, powers and franchises
of ADC and shall be subject to all the restrictions, disabilities and duties of
ADC,
(b) all of the rights, privileges, powers and franchises of ADC, and all
property and debts due to ADC on whatever account shall be vested in Cymedix,
(c) all property, rights, privileges, powers and franchises of ADC shall be
as effectually the property of Cymedix as they were of ADC, and the title to
any real estate vested by deed or otherwise in ADC shall not revert to or be in
any way impaired by reason of the Merger, and
(d) all rights of creditors and all liens upon any property of ADC shall be
preserved unimpaired, and all debts, liabilities and duties of ADC shall attach
to Cymedix and may be enforced against it to the same extent as if those debts,
liabilities and duties had been incurred or contracted by Cymedix.
6. The Merger shall have all the other effects provided by the New Jersey
Act and the Colorado Act.
7. The Plan of Merger shall be submitted to the shareholders of ADC for
their approval in the manner prescribed by the provisions of the New Jersey Act,
and the Merger shall be authorized in the manner prescribed by the provisions of
the Colorado Act.
8. ADC and Cymedix hereby stipulate that, upon approval of the Plan of
Merger by the shareholders of ADC entitled to vote thereon in the manner
prescribed by the provisions of the New Jersey Act and authorization of the
Merger in the manner prescribed by the provisions of the Colorado Act, they will
cause to be executed and filed any document prescribed by the provisions of the
New Jersey Act and the Colorado Act, and they will cause to be performed all
acts necessary to effectuate the Merger.
9.The proper officers of ADC and of Cymedix are hereby authorized,
empowered and directed to do any and all acts and to make, execute, deliver and
file any and all instruments and documents that shall be necessary or proper to
carry out or effect any of the provisions of the Plan of Merger. Each of the
parties will use all reasonable efforts to obtain any necessary waivers,
consents and approvals, effect all necessary filings and take all actions
necessary or appropriate to consummate the transactions contemplated by the Plan
of Merger.
10. Notwithstanding the approval of the Plan of Merger by the shareholders
of ADC entitled to vote thereon in the manner prescribed by the provisions of
the New Jersey Act and authorization of the Merger in the manner prescribed by
the provisions of the Colorado Act, the Merger may be abandoned at any time
prior to the effective time in the State of New Jersey in the event that either
party elects to do so.
AS APPROVED, ADOPTED AND EXECUTED BY EACH OF THE CONSTITUENT ENTITIES AND EACH
OF THE OTHER PARTIES TO THE MERGER AGREEMENT AS OF MARCH 8, 2000