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Title: |
Agreement and Plan of Merger |
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Date: |
2004 |
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Preview shows 22KB of 145KB total |
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$54 |
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ID: |
#1353668 |
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AGREEMENT AND PLAN OF MERGER
THIS AGREEMENT AND PLAN OF MERGER ("AGREEMENT") made this 11th day of
March, 2004 by and among TINTIC GOLD MINING COMPANY, a Utah corporation
("PARENT"), TTGM ACQUISITION CORPORATION, a Utah corporation ("SUB"), and KIWA
BIO-TECH PRODUCTS GROUP LTD., an international business company organized under
the laws of the British Virgin Islands (the "COMPANY").
RECITALS:
A. The respective Boards of Directors of Parent, Sub and the Company
have determined that a merger of Sub with and into the Company (the "MERGER"),
upon the terms and subject to the conditions set forth in this Agreement, would
be fair and in the best interests of their company and their respective
shareholders, and such Boards of Directors have approved such Merger, pursuant
to which the shares of the Company ("COMPANY SHARES") issued and outstanding
immediately prior to the Effective Time of the Merger (as defined in SECTION
1.4), other than Dissenting Shares (as defined in SECTION 2.1.4), will be
converted into the right to receive Common Stock of Parent ("PARENT COMMON
STOCK").
B. Parent, Sub and the Company desire to make certain representations,
warranties, covenants and agreements in connection with the Merger and also to
prescribe various conditions to the Merger.
C. For federal income tax purposes, the parties intend that the Merger
shall qualify as a reorganization under Section 368(a)(1)(A) of the Internal
Revenue Code of 1986, as amended (the "CODE"), by reason of Section 368(a)(2)(E)
of the Code.
AGREEMENT:
NOW, THEREFORE, in consideration of the representations, warranties,
covenants and agreements contained in this Agreement, the parties agree as
follows:
1. THE MERGER.
1.1 THE MERGER. Upon the terms and subject to the
conditions set forth in this Agreement, and in accordance with the Utah Revised
Business Corporation Act (the "UTAH STATUTES") and the British Virgin Islands
International Business Companies Act (Cap. 291) (the "BVI STATUTES"), Sub shall
be merged with and into the Company at the Effective Time of the Merger, Sub and
the Company being the constituent companies for the purposes of the BVI
Statutes. At the Effective Time of the Merger, the separate existence of Sub
shall cease, and the Company shall continue as the surviving corporation (the
"SURVIVING CORPORATION") and shall continue under the name Kiwa Bio-Tech
Products Group Ltd.
1.2 VOTING. The Company has 5,000,000 voting shares in
issue, which are owned and held by the persons and entities set forth on
Schedule 3.1.3 of the Company Disclosure Schedules (as hereinafter defined), and
Sub has 1,000 voting shares issued and outstanding, which are held by Parent.
The holders of the Company Shares and the stock of Sub are each entitled to vote
on the Merger as a single class.
<PAGE>
1.3 CLOSING. Unless this Agreement shall have been
terminated and the transactions herein contemplated shall have been abandoned
pursuant to SECTION 7.1 and subject to the satisfaction or waiver of the
conditions set forth in SECTION 6, the closing of the Merger (the "CLOSING")
will take place at 10:00 a.m. on the business day after satisfaction of the
conditions set forth in SECTION 6 (or as soon as practicable thereafter
following satisfaction or waiver of the conditions set forth in SECTION 6) (the
"CLOSING DATE"), at the offices of Stubbs Alderton & Markiles, LLP, unless
another date, time or place is agreed to in writing by the parties hereto.
1.4 EFFECTIVE TIME OF MERGER. As soon as practicable
following the satisfaction or waiver of the conditions set forth in SECTION 6,
the parties shall file articles of merger (the "ARTICLES OF MERGER") executed in
accordance with the relevant provisions of the Utah Statutes and the BVI
Statutes and shall make all other filings or recordings required under the Utah
Statues and BVI Statutes. The Merger shall become effective at such time as the
Articles of Merger are duly filed with the Department of Commerce of the State
of Utah and the Registry of Corporate Affairs of the British Virgin Islands,
respectively, or at such other time as is permissible in accordance with the
Utah Statues and BVI Statutes and as Parent and the Company shall agree should
be specified in the Articles of Merger (the time the Merger becomes effective
being the "EFFECTIVE TIME OF THE MERGER"). The parties shall use reasonable
efforts to have the Closing Date and the Effective Time of the Merger to be the
same day.
1.5 EFFECTS OF THE MERGER. The Merger shall have the
effects set forth in the applicable provisions of the Utah Statutes and BVI
Statutes.
1.6 MEMORANDUM AND ARTICLES OF ASSOCIATION; PURPOSES.
1.6.1 The Memorandum of Association of the Company
in effect immediately prior to the Effective Time of the Merger shall be the
Memorandum of Association of the Surviving Corporation until thereafter changed
or amended as provided therein or by applicable law.
1.6.2 The Articles of Association of the Company
in effect at the Effective Time of the Merger shall be the Articles of
Association of the Surviving Corporation until thereafter changed or amended as
provided therein or by applicable law.
1.6.3 The purposes of the Surviving Corporation
and the total number of its authorized capital stock shall be as set forth in
the Memorandum and Articles of Association of the Company in effect immediately
prior to the Effective Time of the Merger until such time as such purposes and
such number may be amended as provided in the Memorandum and Articles of
Association of the Surviving Corporation and by applicable law.
1.7 DIRECTORS. The directors of the Company at the
Effective Time of the Merger shall be the directors of the Surviving
Corporation, until the earlier of their resignation or removal or until their
respective successors are duly elected and qualified, as the case may be.
1.8 OFFICERS. The officers of the Company at the
Effective Time of the Merger shall be the officers of the Surviving Corporation,
until the earlier of their resignation or removal or until their respective
successors are duly elected and qualified, as the case may be.
2
<PAGE>
1.9 MEMBER/SHAREHOLDER APPROVAL. This Agreement and the
Articles of Merger shall be submitted to the members or shareholders, as
applicable, of each of the constituent companies (being the Company and Sub) for
their approval by appropriate resolution of such members or shareholders.
2. EFFECT OF THE MERGER ON THE CAPITAL STOCK OF THE CONSTITUENT
CORPORATIONS.
2.1 EFFECT ON CAPITAL STOCK. As of the Effective Time of
the Merger, by virtue of the Merger and without any action on the part of the
holders of Company Shares or any shares of capital stock of Sub:
2.1.1 COMMON STOCK OF SUB. Each share of common
stock of Sub issued and outstanding immediately prior to the Effective Time of
the Merger shall be converted into one share of the Surviving Corporation and
shall be the only issued and outstanding shares of the Surviving Corporation.
2.1.2 CANCELLATION OF PARENT-OWNED COMPANY SHARES.
Each Company Share that is owned by Parent, Sub or any other subsidiary (as
defined in SECTION 9.2) of Parent shall automatically be cancelled and retired
and shall cease to exist, and no Parent Common Stock or other consideration
shall be delivered or deliverable in exchange therefor.
2.1.3 CONVERSION OF COMPANY SHARES. Except as
otherwise provided herein, each issued and outstanding Company Share shall be
converted into fully paid and nonassessable shares of Parent Common Stock in
accordance with the Exchange Ratio described in SECTION 2.2 (the "MERGER
CONSIDERATION"). The Merger Consideration shall be deposited by Parent with the
Exchange Agent (as described below) further to SECTION 2.4 herein.
2.1.4 DISSENTING SHARES. Notwithstanding anything
in this Agreement to the contrary, Company Shares issued and outstanding
immediately prior to the Effective Time of the Merger held by a holder (if any)
who has the right to dissent from the Merger and demand payment for and an
appraisal of such shares in accordance with the BVI Statutes ("DISSENTING
SHARES") shall not be converted into a right to receive Merger Consideration
unless such holder fails to dissent in accordance with the requirements of the
BVI Statutes. If such holder fails to dissent in accordance with the
requirements of the BVI Statutes, each such share of such holder shall be
treated as a share that had been converted as of the Effective Time of the
Merger into the right to receive Merger Consideration in accordance with this
SECTION 2.1. The Company shall give prompt notice to Parent of any dissention,
and Parent shall have the right to participate in all negotiations and
proceedings with respect to such demands. The Company shall not, except with the
prior written consent of Parent, make any payment with respect to, or settle or
offer to settle, any such demands, except as required by the BVI Statutes or a
court order.
2.1.5 CANCELLATION AND RETIREMENT OF COMPANY
SHARES. As of the Effective Time of the Merger, all Company Shares issued and
outstanding immediately prior to the Effective Time of the Merger, shall no
longer be outstanding and shall automatically be cancelled and retired and shall
cease to exist, and each holder of a certificate representing any
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<PAGE>
such Company Shares shall cease to have any rights with respect thereto, except
the right to receive the applicable Merger Consideration to be issued in
consideration therefor.
2.2 EXCHANGE RATIO. The "EXCHANGE RATIO" is as follows:
Each Company Share shall be converted into 1.5445839 shares of
Parent Common Stock in the Merger, an Exchange Ratio of Company Shares to Parent
Common Stock of 1:1.5445839. The Merger Consideration shall be distributable by
the Exchange Agent effective as of the Effective Time of the Merger in
accordance with the provisions of SECTION 2.4.1 herein. No fractional Parent
Common Stock shall be issued in the Merger. If the product of the number of
shares a Company shareholder holds immediately prior to the Closing multiplied
by the exchange ratio would result in the issuance of a fractional share of
Parent Common Stock, that product will be rounded down to the nearest whole
number of shares of Parent Common Stock if it is equal to or less than the
fraction of one-half (.5) of one Parent Common Stock or round up to the nearest
whole number of shares of Parent Common Stock if the said product is greater
than the fraction of one-half (.5) of one Parent Common Stock.
2.3 STOCK OPTIONS; WARRANTS.
2.3.1 ASSUMPTION. At the Effective Time of the
Merger, all options to purchase Company Shares then outstanding and all warrants
to purchase Company Shares then outstanding, in each case whether vested or
unvested, shall be assumed by Parent in accordance with SECTION 2.3.2 hereof.
2.3.2 STOCK OPTIONS AND WARRANTS. At the Effective
Time of the Merger, each outstanding option to purchase Company Shares (each, a
"COMPANY STOCK OPTION") and all outstanding warrants to purchase Company Shares
(each, a "COMPANY WARRANT") then outstanding, in each case whether or not
vested, shall by virtue of the Merger be assumed by Parent. Each Company Stock
Option and Company Warrant so assumed by Parent under this Agreement will
continue to have, and be subject to, the same terms and conditions of such
options immediately prior to the Effective Time of the Merger (including,
without limitation, any repurchase rights or vesting provisions and provisions
regarding the acceleration of vesting on certain transactions), except that (i)
each Company Stock Option and Company Warrant will be exercisable (or will
become exercisable in accordance with its terms) for that number of whole shares
of Parent Common Stock equal to the product of the number of Company Shares that
were issuable upon exercise of such Company Stock Option or Company Warrant
immediately prior to the Effective Time of the Merger multiplied by the Exchange
Ratio, rounded down to the nearest whole number of shares of Parent Common Stock
if the said product is equal to or less than the fraction of one-half (.5) of
one Parent Common Stock or rounded up to the nearest whole number of shares of
Parent Common Stock if the said product is greater than the fraction of one-half
(.5) of one Parent Common Stock, and (ii) the per share exercise price for the
shares of Parent Common Stock issuable upon exercise of such assumed Company
Stock Option and Company Warrant will be equal to the quotient determined by
dividing the exercise price per Company Share at which such Company Stock Option
and Company Warrant was exercisable immediately prior to the Effective Time of
the Merger by the Exchange Ratio, rounded up to the nearest whole cent. Parent
shall comply with the terms of all such Company Stock Options and Company
Warrants and use its best efforts to ensure, to the extent required by, and
subject to the
4
<PAGE>
provisions of, the Company's stock incentive plans and permitted under the Code
or other relevant laws and regulations that any Company Stock Option that
qualified for tax treatment under Section 424(b) of the Code prior to the
Effective Time of the Merger continue to so qualify after the Effective Time of
the Merger. Parent shall take all corporate actions necessary to reserve for
issuance a sufficient number of shares of Parent Common Stock for delivery upon
exercise of all Company Stock Options and Company Warrants on the terms set
forth in this SECTION 2.3.2.
2.4 EXCHANGE OF CERTIFICATES.
2.4.1 EXCHANGE AGENT. As soon as reasonably
practicable as of or after the Effective Time of the Merger, but in no event
later than the second (2nd) business day following the Effective Time of the
Merger, Parent shall deposit the Initial Deposit with Leonard W. Burningham,
Esq. (the "EXCHANGE AGENT"), for the benefit of the holders of Company Shares,
for exchange in accordance with this SECTION 2.
2.4.2 EXCHANGE PROCEDURES. As soon as practicable
after the Effective Time of the Merger, each holder of an outstanding
certificate or certificates which prior thereto represented Company Shares
(each, a "SHAREHOLDER") shall, upon surrender to the Exchange Agent of such
certificate or certificates (or a lost stock affidavit and indemnity in form
reasonably satisfactory to the Exchange Agent) and acceptance thereof by the
Exchange Agent, be entitled to a certificate or certificates representing the
number of shares of Parent Common Stock into which the aggregate number of
Company Shares previously represented by such certificate or certificates
surrendered shall have been converted pursuant to this Agreement. The Exchange
Agent shall accept such certificates (or a lost stock affidavit and indemnity in
lieu thereof) upon compliance with such reasonable terms and conditions as the
Exchange Agent may impose to effect an orderly exchange thereof in accordance
with normal exchange practices. After the Effective Time of the Merger, there
shall be no further transfer on the records of the Company or its transfer agent
of certificates representing Company Shares and if such certificates are
presented to the Company for transfer, they shall be cancelled against delivery
of certificates for Parent Common Stock as hereinabove provided. If any
certificate for such Parent Common Stock is to be issued in a name other than
that in which the certificate for Company Shares surrendered for exchange is
registered, it shall be a condition of such exchange that the certificate so
surrendered shall be properly endorsed, with signature guaranteed, or otherwise
in proper form for transfer and that the person (as defined in SECTION 9.2)
requesting such exchange shall pay to Parent or its transfer agent any transfer
or other taxes or other costs required by reason of the issuance of certificates
for such Parent Common Stock in a name other than that of the registered holder
of the certificate surrendered, or establish to the satisfaction of Parent or
its transfer agent that all taxes have been paid. Until surrendered as
contemplated by this SECTION 2.4.2, each certificate for Company Shares shall be
deemed at any time after the Effective Time of the Merger to represent only the
right to receive upon such surrender the Merger Consideration as contemplated by
SECTION 2.1.
2.4.3 DISTRIBUTIONS WITH RESPECT TO UNEXCHANGED
SHARES. No dividends or other distributions with respect to Parent Common Stock
with a record date after the Effective Time of the Merger shall be paid to the
holder of any unsurrendered certificate for Company
5
<PAGE>
Shares with respect to the shares of Parent Common Stock represented thereby
until the surrender of such certificate in accordance with this SECTION 2.
2.4.4 NO FURTHER OWNERSHIP RIGHTS IN COMPANY
SHARES. All shares of Parent Common Stock issued upon the surrender for exchange
of certificates representing Company Shares in accordance with the terms of this
SECTION 2 shall be deemed to have been issued (and paid) in full satisfaction of
all rights pertaining to the Company Shares theretofore represented by such
certificates.
2.4.5 NO LIABILITY. None of Parent, Sub, the
Company or the Exchange Agent shall be liable to any person in respect of any
shares of Parent Common Stock (or dividends or distributions with respect
thereto) delivered to a public official pursuant to any applicable abandoned
property, escheat or similar law. If any certificates representing Company
Shares shall not have been surrendered prior to December 31, 2004, any such
shares, dividends or distributions in respect of such certificate shall, to the
extent permitted by applicable law, become the property of the Surviving
Corporation, free and clear of all claims or interests of any person previously
entitled thereto.
3. REPRESENTATIONS AND WARRANTIES.
3.1 REPRESENTATIONS AND WARRANTIES OF THE COMPANY. Except
as set forth in the disclosure schedule delivered by the Company to Parent at
the time of execution of this Agreement (the "COMPANY DISCLOSURE SCHEDULE"), or
a certain schedule comprising the Company Disclosure Schedule, the Company
represents and warrants to Parent and Sub as follows:
3.1.1 ORGANIZATION, STANDING AND CORPORATE POWER.
The Company is duly organized, validly existing and in good standing under the
laws of the British Virgin Islands and has the requisite corporate power and
authority to carry on its business as now being conducted. The Company is duly
qualified or licensed to do business and is in good standing in each
jurisdiction in which the nature of its business or the ownership or leasing of
its properties makes such qualification or licensing necessary, other than in
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