-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, TRet7R0kCAHLU/5+IJMLDFUKa5jEXPcJwlZnDpSIywvFvRQK8XT8ezaCzV+/X5W6 QNRFFhcJMS37SfuU5wuVGQ== 0001014100-99-000034.txt : 19990309 0001014100-99-000034.hdr.sgml : 19990309 ACCESSION NUMBER: 0001014100-99-000034 CONFORMED SUBMISSION TYPE: SC 13D PUBLIC DOCUMENT COUNT: 3 FILED AS OF DATE: 19990308 GROUP MEMBERS: GREGORY ROTMAN GROUP MEMBERS: HANNAH KRAMER GROUP MEMBERS: MARC STENGEL GROUP MEMBERS: RICHARD ROTMAN GROUP MEMBERS: ROTMAN GREGORY SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: SECURITIES RESOLUTION ADVISORS INC CENTRAL INDEX KEY: 0001017655 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-PREPACKAGED SOFTWARE [7372] IRS NUMBER: 731479833 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D SEC ACT: SEC FILE NUMBER: 005-51413 FILM NUMBER: 99559537 BUSINESS ADDRESS: STREET 1: 80 SEAVIEW BLVD STREET 2: SUITE 220 CITY: PORT WASHINGTON STATE: NY ZIP: 11050 BUSINESS PHONE: 5166254040 MAIL ADDRESS: STREET 1: 7633 EAST 63RD PL STREET 2: SUITE 220 CITY: TULSA STATE: OK ZIP: 74133 FORMER COMPANY: FORMER CONFORMED NAME: ROSE INTERNATIONAL LTD DATE OF NAME CHANGE: 19960627 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: ROTMAN GREGORY CENTRAL INDEX KEY: 0001081226 STANDARD INDUSTRIAL CLASSIFICATION: [] FILING VALUES: FORM TYPE: SC 13D BUSINESS ADDRESS: STREET 1: C/O SECURITIES RESOLUTION ADVISORS INC STREET 2: 4 BRUSSELS STREET CITY: WORCESTER STATE: MA ZIP: 01610 BUSINESS PHONE: 5087530945 MAIL ADDRESS: STREET 1: C/O SECURITIES RESOLUTION ADVISORS INC STREET 2: 4 BRUSSELS STREET CITY: WORCESTER STATE: MA ZIP: 01610 SC 13D 1 SCHEDULE 13D SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 ------------ SCHEDULE 13D (Rule 13d-101) UNDER THE SECURITIES EXCHANGE ACT OF 1934 (Amendment No. __________) Securities Resolution Advisors, Inc. (Name of Issuer) Common Stock $.001 Par Value Per Share (Title of Class of Securities) 81375R107 (CUSIP Number)
Abba David Poliakoff, Esquire, Gordon, Feinblatt, Rothman, Hoffberger & Hollander, LLC 233 E. Redwood Street, Baltimore, Maryland 21202, (410) 576-4118 (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications) February 25, 1999 (Date of Event Which Requires Filing of This Statement)
If the filing person has previously filed a statement on Schedule 13G to report the acquisition which is the subject of this Schedule 13D, and is filing this schedule because of Rule 13d-1 (b)(3) or (4), check the following box |_|. * The remainder of this cover page shall be filled out for a reporting person's initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page. The information required on the remainder of this cover page shall not be deemed to be "filed" for the purpose of Section 18 of the Securities Exchange Act of 1934 ("Act") or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes). - ------------------------------------ ------------------------- CUSIP No. 81375R107 13D Page 2 of 9 Pages - ------------------------------------ ------------------------- - -------------------------------------------------------------------------------- 1 NAME OF REPORTING PERSON S.S. NO. OF ABOVE PERSON (voluntary) Gregory Rotman __-_______ - -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) |_| (b) (Clock) - -------------------------------------------------------------------------------- 3 SEC USE ONLY - -------------------------------------------------------------------------------- 4 SOURCE OF FUNDS* OO - -------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e) |_| - -------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION United States - -------------------------------------------------------------------------------- 7 SOLE VOTING POWER NUMBER 8,309,005 OF SHARES BENEFICIALLY --------------------------------------------------------- OWNED 8 SHARED VOTING POWER BY EACH 0 REPORTING PERSON --------------------------------------------------------- WITH 9 SOLE DISPOSITIVE POWER 8,309,005 --------------------------------------------------------- 10 SHARED DISPOSITIVE POWER 0 - -------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 8,309,005 - -------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* |_| - -------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 17.90% - -------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON* IN - -------------------------------------------------------------------------------- - ------------------------------------ ------------------------- CUSIP No. 81375R107 13D Page 3 of 9 Pages - ------------------------------------ ------------------------- - -------------------------------------------------------------------------------- 1 NAME OF REPORTING PERSON S.S. NO. OF ABOVE PERSON (voluntary) Richard Rotman __-_______ - -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) |_| (b) (Clock) - -------------------------------------------------------------------------------- 3 SEC USE ONLY - -------------------------------------------------------------------------------- 4 SOURCE OF FUNDS* OO - -------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e) |_| - -------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION United States - -------------------------------------------------------------------------------- 7 SOLE VOTING POWER NUMBER 10,155,451 OF SHARES --------------------------------------------------------- BENEFICIALLY 8 SHARED VOTING POWER OWNED 0 BY --------------------------------------------------------- EACH 9 SOLE DISPOSITIVE POWER REPORTING 10,155,451 PERSON --------------------------------------------------------- WITH 10 SHARED DISPOSITIVE POWER 0 - -------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 10,155,451 - -------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* |_| - -------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 21.88% - -------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON* IN - -------------------------------------------------------------------------------- - ------------------------------------ ------------------------- CUSIP No. 81375R107 13D Page 4 of 9 Pages - ------------------------------------ ------------------------- - -------------------------------------------------------------------------------- 1 NAME OF REPORTING PERSON S.S. NO. OF ABOVE PERSON (voluntary) Marc Stengel __-_______ - -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) |_| (b) (Clock) - -------------------------------------------------------------------------------- 3 SEC USE ONLY - -------------------------------------------------------------------------------- 4 SOURCE OF FUNDS* OO - -------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e) |_| - -------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION United States - -------------------------------------------------------------------------------- 7 SOLE VOTING POWER NUMBER 12,925,119 OF SHARES --------------------------------------------------------- BENEFICIALLY 8 SHARED VOTING POWER OWNED 0 BY --------------------------------------------------------- EACH 9 SOLE DISPOSITIVE POWER REPORTING 12,925,119 PERSON --------------------------------------------------------- WITH 10 SHARED DISPOSITIVE POWER 0 - -------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 12,925,119 - -------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* |_| - -------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 27.85% - -------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON* IN - -------------------------------------------------------------------------------- - ------------------------------------ ------------------------- CUSIP No. 81375R107 13D Page 5 of 9 Pages - ------------------------------------ ------------------------- - -------------------------------------------------------------------------------- 1 NAME OF REPORTING PERSON S.S. NO. OF ABOVE PERSON (voluntary) Hannah Kramer __-_______ - -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) |_| (b) (Clock) - -------------------------------------------------------------------------------- 3 SEC USE ONLY - -------------------------------------------------------------------------------- 4 SOURCE OF FUNDS* OO - -------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e) |_| - -------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION United States - -------------------------------------------------------------------------------- 7 SOLE VOTING POWER NUMBER 5,539,337 OF SHARES --------------------------------------------------------- BENEFICIALLY 8 SHARED VOTING POWER OWNED 0 BY --------------------------------------------------------- EACH 9 SOLE DISPOSITIVE POWER REPORTING 5,539,337 PERSON --------------------------------------------------------- WITH 10 SHARED DISPOSITIVE POWER 0 - -------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 5,539,337 - -------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* |_| - -------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 11.94% - -------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON* IN - -------------------------------------------------------------------------------- SCHEDULE 13D This Schedule 13D is being filed on behalf of each of Gregory Rotman, Richard Rotman, Marc Stengel and Hannah Kramer ("Reporting Persons"), all of whom have agreed to file a joint report on Schedule 13D. Item 1. Security and Issuer. This statement on Schedule 13D relates to the shares of common stock, par value $.001 per share (the "Shares") of Securities Resolution Advisors, Inc., a Delaware corporation (the "Issuer") pursuant to Rule 13d-1 under the Securities Exchange Act of 1934, as amended (the "Exchange Act"). The address of the principal executive offices of the Issuer is 4 Brussels Street, Worcester, MA 01610. Item 2. Identity and Background. I. (a) Gregory Rotman. (b) 4 Brussels Street, Worcester, MA 01610. (c) President and Director of the Issuer. (d) No. (e) No. (f) U.S. II. (a) Richard Rotman. (b) 4 Brussels Street, Worcester, MA 01610. (c) Vice-President, Treasurer, Secretary and Director of the Issuer. (d) No. (e) No. (f) U.S. III. (a) Marc Stengel. (b) 3743 Birch Lane, Owings Mills, MD 21117 (c) Vice-President and Director of the Issuer. (d) No. (e) No. (f) U.S. IV. (a) Hannah Kramer. (b) 673 Korisa Drive, Huntington Valley, PA 19006 (c) Vice-President and Director of the Issuer. (d) No. (e) No. (f) U.S. - 6 - Item 3. Source and Amount of Funds or Other Consideration. The Reporting Persons were the holders of the common stock of Internet Auction, Inc., a Massachusetts corporation. Internet Auction, Inc. entered into an Agreement and Plan of Reorganization with the Issuer on January 31, 1999 (the "Reorganization Agreement"). At the closing of the transaction described in the Reorganization Agreement, on February 25, 1999, the Reporting Persons assigned and transferred to the Issuer all of their shares of Internet Auction, Inc., constituting all of the issued and outstanding shares of the capital stock of that Company, in exchange for an aggregate of 37,368,912 Shares of the Issuer. As a result of the transaction (the "Share Exchange"), Internet Auction, Inc. has become a wholly-owned subsidiary of the Issuer. Item 4. Purpose of Transaction. The Shares were acquired by the Reporting Persons in the Share Exchange described in Item 3 hereof. As a result of the Share Exchange, Internet Auction, Inc. became a wholly-owned subsidiary of the Issuer and the Reporting Persons became the beneficial owners of approximately 80% of the Shares of the Issuer. The principal business of the Issuer after the Share Exchange is the business of Internet Auction, Inc. Because of the experience and background of the Reporting Persons in conducting the business of Internet Auction, Inc., the Issuer agreed in the Reorganization Agreement that, upon the closing of the Share Exchange, the Reporting Persons will be appointed to the Board of Directors of the Issuer and will constitute a majority of the Board. By virtue of their beneficial ownership of the Shares, the Reporting Persons are entitled to elect the Board of Directors of the Issuer. In their positions as directors and officers of the Issuer, the Reporting Persons are controlling persons of the Issuer. Although the Reporting Persons may be deemed to be a "group" (as defined in Section 13(d) of the Securities Exchange Act of 1934) the Reorganization Agreement and consummating the Share Exchange, the Reporting Persons disclaim the existence of a group for any other purpose. The Reporting Persons have no contracts, arrangements, understandings or relationships (legal or otherwise) among them or with any the other person with respect to the securities of the Issuer, including but not limited to the transfer or voting of any of the Shares. The Reporting Persons do not have any current plans or proposals which relate to or would result in: (a) the acquisition by any person of additional securities of the Issuer, or the disposition of securities of the Issuer; (b) an extraordinary corporate transaction, such as a merger, reorganization or liquidation, involving the Issuer or any of its subsidiaries; (c) a sale or transfer of a material amount of assets of the Issuer or any of its subsidiaries; (d) any change in the present Board of Directors or management of the Issuer, including any plans or proposals to change the number or term of directors or to fill any existing vacancies on the board; (e) any material change in the present capitalization or dividend policy of the Issuer; (f) any other material change in the Issuer's business or corporate structure; (g) changes in the Issuer's charter, By-Laws or instruments corresponding thereto or other actions which may impede the acquisition - 7 - of control of the Issuer by any person; (h) causing a class of securities of the Issuer to be delisted from a national securities exchange or to cease to be authorized to be quoted in an inter-dealer quotation system of a registered national securities association; (i) a class of equity securities of the Issuer becoming eligible for termination of registration pursuant to Section 12(g)(4) of the Exchange Act; or (j) any action similar to any of those enumerated above. As directors and officers of the Issuer, however, and in the exercise of their fiduciary duty, the Reporting Persons will from time to time review all opportunities available to the Issuer, including any of the actions listed above. Item 5. Interest in Securities of the Issuer. (a) As of February 25, 1999, each of the Reporting Persons owned the number of shares listed below: The percentage of class is computed on the basis of 46,411,140 outstanding Shares as of February 25, 1999. Name # of Shares % of Class ---- ----------- ---------- Gregory Rotman 8,309,005 17.90% Richard Rotman 10,155,451 21.88% Marc Stengel 12,925,119 27.85% Hannah Kramer 5,539,337 11.94% (b) Each Reporting Person has voting and dispositive power with respect to all Shares held by such person. (c) During the sixty-day period ended as of the date hereof, no Reporting Person has purchased any Shares in the open market. (d) No person other than the Reporting Persons referred to herein is known to have the right to receive or the power to direct the receipt of dividends from, or the proceeds from the sale of, such Shares. (e) Not applicable. Item 6. Contracts, Arrangements, Understandings or Relationships With Respect to Securities of the Issuer On January 31, 1999, the Reporting Persons entered into the Reorganization Agreement with the Issuer pursuant to which the parties agreed to the Share Exchange whereby the Issuer would acquire all of the outstanding shares of the capital stock of Internet Auction, Inc. in exchange for 37,368,912 Shares of the Issuer. The transactions contemplated by the Reorganization Agreement were consummated on February 25, 1999. - 8 - The parties entered in an agreement to File Joint Schedule 13D on March 5, 1999. Except as described above, the Reporting Persons have no contracts, arrangements, understandings or relationships (legal or otherwise) among them or with any other person with respect to the securities of the Issuer, including but not limited to the transfer or voting of any of the Shares. Item 7. Material to be Filed as Exhibits. The following exhibit is attached to this Schedule 13D: 1. Agreement and Plan of Reorganization dated January 31, 1999, among the Issuer and Gregory Rotman, Richard Rotman, Marc Stengel and Hannah Kramer. 2. Agreement to File Joint Schedule 13D dated March 5, 1999 among the Reporting Persons. - 9 - SIGNATURES After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct. Dated: March 8, 1999 /s/ Gregory Rotman -------------------------------- Gregory Rotman /s/ Richard Rotman --------------------------------- Richard Rotman /s/ Marc Stengel --------------------------------- Marc Stengel /s/ Hannah Kramer --------------------------------- Hannah Kramer - 10 - EX-1 2 AGMT. AND PLAN OF REORGANIZATION AGREEMENT AND PLAN OF REORGANIZATION BY AND AMONG SECURITIES RESOLUTION ADVISORS, INC., GREGORY ROTMAN, RICHARD ROTMAN, MARC STENGAL AND HANNAH KRAMER THIS AGREEMENT AND PLAN OF REORGANIZATION ("Agreement") is entered into this 31st of January, 1999, by and among SECURITIES RESOLUTION ADVISORS, INC., a Delaware corporation (hereinafter referred to as "Buyer"); and GREGORY ROTMAN, RICHARD ROTMAN, MARC STENGAL AND HANNAH KRAMER (hereinafter collectively referred to as "Seller"), being all of the shareholders of INTERNET AUCTION, INC., a Massachusetts corporation (hereafter referred to as "Company"). WHEREAS, Seller is the owner of record and beneficially owns Forty Thousand (40,000) shares of the issued and outstanding shares of Common Stock of the Company (the "Shares"); and WHEREAS, the Shares represent 100% of all the issued and outstanding shares of the Company; and WHEREAS, Seller desires to sell all of the Shares to Buyer, and Buyer desires to purchase the Shares, upon the terms and conditions set forth herein; WHEREAS, the parties intend that the exchange of Shares for shares of Buyer's common stock, as contemplated herein, qualify as a tax free transaction under Section 368 of the Internal Revenue Code; NOW, THEREFORE, in consideration of the mutual promises and covenants contained herein, and for other good and valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged, and subject to the accuracy of the representations and warranties of the parties, the parties hereto agree as follows: I. SALE AND PURCHASE OF THE SHARES 1.1 Sale and Purchase. Subject to the terms and conditions hereof at the Closing (as defined in paragraph 1.2 below), Seller agrees to sell, assign, transfer, convey and deliver to Buyer, and Buyer agrees to purchase from Seller, the Shares listed in Exhibit "A", attached hereto, which together constitute 100% of the issued and outstanding Shares of Common Stock of the Company. 1.2 Closing. The purchase shall be consummated at a closing ("Closing") to take place at 10:00 o'clock a.m., at the offices of Buyer's counsel on February 25, 1999 ("Closing Date"). 1.3 Purchase Price. The aggregate purchase price ("Purchase Price") for the Shares shall be Thirty-Seven Million Three Hundred Sixty-Eight Thousand Nine Hundred Twelve (37,368,912) shares of common stock of the Buyer ("Buyer Shares") which shall represent 80% of the issued and outstanding stock of the Buyer, calculated on a fully diluted basis. The purchase price shall be paid at Closing by issuance and delivery of Buyer's Shares to Seller against receipt of certificates representing the Shares, duly endorsed for transfer to Buyer. 1.4 Allocation of Shares. All shares of stock of Buyer to be issued to Seller pursuant to this Agreement shall be issued to the respective Sellers in proportion to their respective ownership of stock of the Company as described in Exhibit "A" hereto. II. REPRESENTATIONS AND WARRANTIES 2.1 Representations and Warranties of Seller. Seller represent and warrant to Buyer as follows: (a) Title to the Shares. At Closing, Seller shall own of record and beneficially the number of the Shares listed in Exhibit "A", of the Company, free and clear of all liens, encumbrances, pledges, claims, options, charges and assessments of any nature whatsoever, with full right and lawful authority to transfer the Shares to Buyer. No person has any preemptive rights or rights of first refusal with respect to any of the Shares. There exists no voting agreement, voting trust, or outstanding proxy with respect to any of the Shares. Them are no outstanding rights, options, warrants, calls, commitments, or any other agreements of any character, whether oral or written, with respect to the Shares. (b) Organization. The Company is a corporation duly incorporated, validly existing and in good standing under the laws of the state of Massachusetts. The Company has all requisite corporate power and authority to own, lease and operate its properties and to carry on its business. The Company is duly qualified and in good standing as a foreign corporation in each jurisdiction where its ownership of property or operation of its business requires qualification. (c) Authorized Capitalization. The authorized capitalization of the Company consists of Two Hundred Thousand (200,000) shares of Common Stock, no par value, of which Forty Thousand (40,000) shares have been issued and are outstanding. The Shares have been duly authorized, validly issued, are fully paid and nonassessable with no personal liability attaching to the ownership thereof and were offered, issued, sold and delivered by the Company in compliance with all applicable state and federal laws. The Company does not have any outstanding rights, options, warrants, calls, commitments, conversion or any other agreements of any character, whether oral or written, obligating it to issue any shares of its capital stock, whether authorized or not. The Company is not a party to and are not bound by any agreement, contract~ arrangement or understanding, whether oral or written, giving any person or entity any interest in, or any right to share, participate in or receive any portion of, the Company's income, profits or assets, or obligating the Company to distribute any portion of its income, profits or assets. (d) Authority. Seller has full power and lawful authority to execute and deliver the Basic Agreements and to consummate and perform the Transactions contemplated thereby. The Basic Agreements constitute (or shall, upon execution, constitute) valid and legally - 2- binding obligations upon Seller, enforceable in accordance with their terms. Neither the execution and delivery of the Basic Agreements by Seller, nor the consummation and performance of the Transactions contemplated thereby, conflicts with, requires the consent, waiver or approval of, results in a breach of or default under, or gives to others any interest or right of termination, cancellation or acceleration in or with respect to, any agreement by which Seller or the Company is a party or by which Seller or the Company or any of their respective properties or assets are bound or affected. (e) Company Financial Statements. The Company Financial Statements are complete in all material respects, were prepared in accordance with generally accepted accounting principles applied on a basis consistent with prior periods and fairly present the financial position of the Company as of November 30,1998. (f) No Undisclosed Liabilities. Except as set forth in the Company Financial Statements previously delivered to Buyer and as set forth on Exhibit "B", Seller is not aware of any liabilities for which the Company is liable or will become liable in the future. (g) Taxes. The Company has filed all federal, state, local tax and other returns and reports which were required to be filed with respect to all taxes, levies, imposts, duties, licenses and registration fees, charges or withholdings of every nature whatsoever ("Taxes"), and their exists a substantial basis in law and fact for all positions taken in such reports. No waivers of periods of limitation are in effect with respect to any taxes arising from and attributable to the ownership of properties or operations of the business of the Company. (h) Properties The Company has good and marketable title to all its personal property, equipment, processes, patents, copyrights, trademarks, franchises, licenses and other properties and assets (except for items leased or licensed to the Company), including all property reflected in the Company Financial Statements (except for assets reflected therein which have been sold in the normal course of its business where the proceeds from such sale or other disposition have been properly accounted for in the financial statements of the Company), in each case free and clear of all liens, claims and encumbrances of every kind and character, except as set forth in Exhibit "C". The Company has no ownership interest in any real property. The assets and properties owned, operated or leased by the Company and used in its business are in good operating condition in all material respects, reasonable wear and tear excepted, and suitable for the uses for which intended. - 3 - (i) Books and Record. The books and records of the Company are complete and correct in all material respects, have been maintained in accordance with good business practices and accurately reflect in all material respects the business, financial condition and results of operations of the Company as set forth in the Company Financial Statements. (j) Insurance. Exhibit "D" contains an accurate and complete list and brief description of all performance bonds and policies of insurance, including fire and extended coverage, general liability, workers compensation, products liability, property, and other forms of insurance or indemnity bonds held by the Company. To the Seller's knowledge and belief, the Company is not in default with respect to any provisions of any such policy or indemnity bond and has not failed to give any notice or present any claim thereunder in due and timely fashion. All policies of insurance and bonds are: (1) in full force and effect; (2) are sufficient for compliance by the Company with all requirements of law and of all agreements and instruments to which the Company is a party-, (3) are valid, outstanding and enforceable; (4) provide adequate insurance coverage for the assets, business and operations of the Company in amounts at least equal to customary coverage in the Company's industry, (5) will remain in full force and effect through the Closing; and (6) will not be affected by, and will not terminate or lapse by reason of~ the transactions contemplated by this Agreement. (k) Material Contracts. Except as set forth in Exhibit "E", the Company has no purchase, sale, commitment, or other contract, the breach or termination of which would have a materially adverse effect on the business, financial condition, results of operations, assets, liabilities, or prospects of the Company. (l) Authorizations. The Company has no licenses, permits, approvals and other authorizations from any governmental agencies and any other entities that are necessary for the conduct of its business, except as set forth in Exhibit "F" which contains a list of all licenses, permits, approvals, and other authorizations, as well as a list of all copyrights, patents, trademarks, tradenames, servicemarks, franchises, licenses and other permits, each of which is valid and in full force and effect. (m) No Powers of Attorney. The Company has no powers of attorney or similar authorizations outstanding. (n) Compliance with Laws. To Seller's knowledge and belief, the Company is not in violation of any federal, state, local or other law, ordinance, rule or regulation applicable to its business, and have not received any actual or threatened complaint, citation or notice of violation or investigation from any governmental authority. (o) Compliance with Environmental Laws. To Seller's knowledge and belief, the Company is in compliance with all applicable pollution control and environmental laws, rules and regulations. The Company has no environmental licenses, permits and other authorizations held by the Company relative to compliance with environmental laws, rules and regulations. - 4 - (p) No Litigation. To Seller's knowledge and belief, there are no material actions, suits, claims, complaints or proceedings pending or threatened against the Company, at law or in equity, or before or by any governmental department, commission, court, board, bureau, agency or instrumentality; and there are no facts which would provide a valid basis for any such action, suit or proceeding. There are no orders, judgments or decrees of any governmental authority outstanding which specifically apply to the Company or any of its assets. (q) Validity. To Seller's knowledge and belief, all contracts, agreements, leases and licenses to which the Company is a party or by which it or any of its properties or assets are bound or affected, are valid and in full force and effect; and no breach or default exists, or upon the giving of notice or lapse of time, or both, would exist, on the part of the Company or by any other party thereto. (r) No Adverse Changes. To Seller's knowledge and belief, since November 30, 1998, there have been no actual or threatened developments of a nature that is materially adverse to or involves any materially adverse effect upon the business, financial condition, results of operations, assets, liabilities, or prospects of the Company. (s) Fees. All negotiations relating to this Agreement and the Transactions have been conducted by the Seller in such a manner as not to give rise to any valid claim for any finder's fees, brokerage commission, financial advisory fee or related expense or other like payment for which the Company or Buyer are or may be liable. (t) Full Disclosure. All statements of Seller contained in this Agreement and in any other written documents delivered by or on behalf of the Company or Seller to buyer are true and correct in all material respects and do not omit any material fact necessary to make the statements contained and described or referenced herein not misleading in light of the circumstances under which they were made. There are no facts known to Seller which could have a materially adversely affect upon the business, financial condition, results of operations, assets, liabilities, or prospects of the Company, which have not been disclosed to Buyer in this Agreement. 2.2 Representations and Warranties of Buyer. Buyer represents and warrants to Seller as follows: (a) Organization. The Buyer is a corporation duly incorporated, validly existing and in good standing under the laws of the state of Delaware. The Buyer has all requisite corporate power and authority to own, lease and operate its properties and to carry on its business. The Buyer is duly qualified and in good standing as a foreign corporation in each jurisdiction where its ownership of property or operation of its business requires qualification. (b) Authorized Capitalization. The authorization capitalization of the Buyer at Closing will consist of One Hundred Million (100,000,000) shares of Common Stock, $.001 par value, of which Nineteen Million Five Hundred Forty-Two Thousand Two Hundred Twenty- Eight (19,542,228) shares have bene issued and are outstanding. All shares have been duly authorized, validly issued, are fully paid and nonassessable with no personal liability attaching - 5 - to the ownership thereof and were offered, issued, sold and delivered by the Buyer in compliance with all applicable state and federal laws. The Buyer does not have any outstanding rights, options, warrants, calls, commitments, conversion or any other agreements of any character, whether oral or written, obligating it to issue any shares of its capital stock, whether authorized or not (whether such obligation is contingent or otherwise). Buyer is not a party to and is not bound by any agreement, contract, arrangement or understanding, whether oral or written, giving any person or entity any interest in, or any right to share, participate in or receive any portion of, the Buyer's income, profits or assets, or obligating the Buyer to distribute any portion of its income, profits or assets. (c) Authority. Buyer has full power and lawful authority to execute and deliver the Basic Agreements and to consummate and perform the Transactions contemplated thereby. The Basic Agreements constitute (or shall, upon execution, constitute) valid and legally binding obligations upon Buyer, enforceable in accordance with their terms. Neither the execution and delivery of the Basic Agreements by Buyer, nor the consummation and performance of the Transactions contemplated thereby, conflicts with, requires the consent, waiver or approval of, results in a breach of or default under, or gives to others any interest or right of termination, cancellation or acceleration in or with respect to, any agreement by which Buyer is a party or by which Buyer or any of its respective properties or assets are bound or affected. (d) Buyer's Financial Statements. The Buyer's Financial Statements are complete, were prepared in accordance with generally accepted accounting principles applied on a basis consistent with prior periods and fairly present the financial position of the Buyer as of September 30, 1998. (e) No Undisclosed Liabilities. Except as set forth in the Buyer's Financial Statements previously delivered to Seller and as set forth on Exhibit "G", Buyer is not aware of any material liabilities for which the Buyer is liable or will become liable in the future. (f) Taxes. Except as set forth in Exhibit "H", the Buyer has filed all federal, state, local tax and other returns and reports which were required to be filed with respect to all taxes, levies, imposts, duties, licenses and registration fees, charges or withholdings of every nature whatsoever ("Taxes"), and their exists a substantial basis in law and fact for all positions taken in such reports. No waivers of periods of limitation are in effect with respect to any b= arising from and attributable to the ownership of properties or operations of the business of the Company. (g) Properties. The Buyer has good and marketable title to all its personal property, equipment, processes, patents, copyrights, trademarks, franchises, licenses and other properties and assets (except for items leased or licensed to the Buyer), including all property reflected in the Buyer's Financial Statements (except for assets reflected therein which have been sold in the normal course of its business where the proceeds from such sale or other disposition - 6 - have been properly accounted for in the financial statements of the Buyer), in each case free and clear of all liens, claims and encumbrances of every kind and character, except as set forth in Exhibit "I". The Buyer has no ownership interest in any real property. The assets and properties owned, operated or leased by the Buyer and used in its business are in good operating condition, reasonable wear and tear excepted, and suitable for the uses for which intended. (h) Books and Records. The books and records of the Buyer are complete and correct in all material respects, have been maintained in accordance with good business practices and accurately reflect in all material respects the business, financial condition and results of operations of the Buyer as set forth in the Buyer's Financial Statements. (i) Insurance. Exhibit "J" contains an accurate and complete list and brief description of all performance bonds and policies of insurance, including fire and extended coverage, general liability, workers compensation, products liability, property, and other forms of insurance or indemnity bonds held by the Buyer. The Buyer is not in default with respect to any provisions of any such policy or indemnity bond and has not failed to give any notice or present any claim thereunder in due and timely fashion. All policies of insurance and bonds are: (1) in M force and effect; (2) am sufficient for compliance by the Buyer with all requirements of law and of all agreements and instruments to which the Buyer is a party-, (3) are valid, outstanding and enforceable; (4) provide adequate insurance coverage for the assets, business and operations of the Buyer in amounts at least equal to customary coverage in the Buyer's industry;, (5) will remain in full force and effect through the Closing; and (6) will not be affected by, and will not terminate or lapse by reason of, the transactions contemplated by this Agreement. (j) Transactions with Certain Persons. Except as disclosed in Exhibit "K", the Buyer has no outstanding agreement, understanding, contract, lease, commitment, loan or other arrangement with any officer, director or shareholder of the Buyer or any Affiliate (as defined herein) of any such person. For purposes of this Agreement~ the term "Affiliate' shall be defined as follows: An Affiliate of a specified Person is (i) any Person that directly or indirectly through one or more intermediaries controls or is controlled by or is under common control with such specified person, (ii) any Person which is an officer, director, partner or trustee o~ or serves in a similar capacity with respect to, such specified Person, (iii) any Person which is directly or indirectly the owner of more than ten percent (10%) of any class of equity securities of such specified Person and (iv) the parents, siblings, children or spouse of such specified Person. Additionally, for - 7 - purposes of this Agreement, the term 'Person" shall mean: Any individual, corporation, business trust, estate, trust, partnership, limited partnership, association, joint venture, limited liability company, governmental subdivision, agency or instrumentality or any other legal or commercial entity." (k) Material Contracts. The Buyer has no purchase, sale, commitment, or other contract, the breach or termination of which would have a materially adverse effect on the business, financial condition, results of operations, assets, liabilities, or prospects of the Buyer. (l) Authorizations. The Buyer has no licenses, permits, approvals and other authorizations from any governmental agencies and any other entities that are necessary for the conduct of its business, except as set forth in Exhibit "L" which contains a list of all licenses, permits, approvals, and other authorizations, as well as a list of all copyrights, patents, trademarks, tradenames, servicemarks, franchises, licenses and other permits, each of which is valid and in full force and effect. (m) No Powers of Attorney. The Buyer has no powers of attorney or similar authorizations outstanding. (n) Compliance with Laws. The Buyer is not in violation of any federal, state, local or other law, ordinance, rule or regulation applicable to its business, and have not received any actual or threatened complaint, citation or notice of violation or investigation from any governmental authority. (o) Compliance with Environmental Laws. The Buyer is in compliance with all applicable pollution control and environmental laws, rules and regulations. The Buyer has no environmental licenses, permits and other authorizations held by the Buyer relative to compliance with environmental laws, rules and regulations. (p) Litigation. Except as disclosed in Exhibit "W, there are no material actions, suits, claims, complaints or proceedings pending or threatened against the Buyer, at law or in equity, or before or by any governmental department, commission, court, board, bureau, agency or instrumentality- and there are no facts which would provide a valid basis for any such action, suit or proceeding. There are no orders, judgments or decrees of any governmental authority outstanding which specifically apply to the Company or any of its assets. - 8 - (q) Validity. All contracts, agreements, leases and licenses to which the Buyer is a party or by which it or any of its properties or assets are bound or affected, are valid and in full force and effect; and no breach or default exists, or upon the giving of notice or lapse of time, or both, would exist, on the part of the Buyer or by any other party thereto. (r) No Adverse Changes. Since September 30, 1998, there have been no actual or threatened developments of a nature that is materially adverse to or involves any materially adverse effect upon the business, financial condition, results of operations, assets, liabilities, or prospects of the Buyer. (s) Full Disclosure. All statements of Buyer contained*in the Basic Agreements and in any other written documents delivered by or on behalf of the Buyer to Seller are true and correct in all material respects and do not omit any material fact necessary to make the statements contained therein not misleading in light of the circumstances under which they were made. There are no facts known to Buyer which could have a materially adversely affect upon the business, financial condition, results of operations, assets, liabilities, or prospects of the Buyer, which have not been disclosed to Buyer in the Basic Agreements. III. COVENANTS 3.1 Covenants of Seller. Seller covenants and agrees that from the date hereof to the Closing without the prior written consent of Buyer: (a) Ordinary Course of Business. Seller will operate the business of the Company only in the ordinary course and will use their best efforts to preserve the Company's business, organization, goodwill and relationships with persons having business dealings with them. (b) Maintain Properties. Seller will maintain all of the Company's properties in good working order, repair and condition (reasonable wear and use excepted) and cause the Company to take all steps reasonably necessary to maintain in full force and effect its patents, trademarks, servicemarks, trade names, brand names, copyrights and other intangible assets. (c) Compensation. Seller will not permit the Company to (1) enter into or alter any employment agreements; (2) grant any increase in compensation other than normal merit increases consistent with the Company's general prevailing practices to any officer or employee; or (3) enter into or alter any labor or collective bargaining agreement or any bonus or other employee fringe benefit. (d) No Indebtedness. Seller will not permit the Company to create, incur, assume, guarantee or otherwise become liable with respect to any obligation for borrowed money, indebtedness, capitalized lease - 9 - or similar obligation, except in the ordinary course of business consistent with past practices where the entire net proceeds thereof are deposited with and used by and in connection with the business of the Company. (e) Maintain Books. Seller will cause the Company to maintain its books, accounts and records in the usual, regular ordinary and sound business manner and in accordance with generally accepted accounting principles applied on a basis consistent with past practices. (f) No Amendments. Seller will not permit the Company to amend its corporate charter or bylaws (or similar documents) without prior consent of Buyer and will cause the Company to maintain their corporate existence, licenses, permits, powers and rights in full force and effect. (g) Taxes and Accounting Matters. Seller will cause the Company to file when due all federal, state and local tax returns and reports which shall be accurate and complete, including but not limited to income, franchise, excise, ad valorem, and other taxes with respect to its business and properties, and to pay as they become due all taxes or assessments, except for taxes for which adequate reserves are established and which are being contested in good faith by appropriate proceedings. Seller will not permit the Company to change their accounting methods or practices or any depreciation, amortization or inventory valuation policies or practices. (h) No Disposition or Encumbrance. Except in the ordinary course of business consistent with past practice, Seller will not permit the Company to (1) dispose of or encumber any of its properties and assets, (2) discharge or satisfy any lien or encumbrance or pay any obligation or liability (fixed or contingent) except for previously scheduled repayment of debt, (3) cancel or compromise any debt or claim, (4) transfer or grant any rights under any concessions, leases, licenses, agreements, patents, inventions, proprietary technology or process, trademarks, servicemarks or copyrights, or with respect to any know-how, or (5) enter into or modify in any material respect or terminate any existing license, lease, or contract. (i) Insurance. Seller will cause the Company to maintain in effect all its current insurance policies. (j) No Securities Issuances. Seller will not permit the Company to issue any shares of any class of capital stock, or enter into any contract, option, wan-ant or right calling for the issuance of any such shares of capital stock, or create or issue any securities convertible into any securities of the Company except for the transactions contemplated herein. (k) No Dividends. Seller will not permit the Company to declare, set aside or pay any dividends or other distributions of any nature whatsoever. (l) Contracts. Seller will not permit the Company to enter into or assume any contract, agreement, obligation, lease, license, or commitment except in the ordinary course of business consistent with past practice or as contemplated by this Agreement. - 10 - (m) No Breach. Seller will not permit the Company to do any act or omit to do any act which would cause a breach of any contract, commitment or obligation of the Company. (n) Due Compliance. Seller will cause the Company to comply with all laws, regulations, rules and ordinances applicable to it and to the conduct of its business. (o) No Waivers of Rights. Seller will not permit the Company to amend, terminate or waive any material right whether or not in the ordinary course of business. (p) Capital Commitments. Seller will not permit the Company to make or commit to make any capital expenditure, capital addition or capital improvement. (q) No Related Party Transactions. Seller will not permit the Company to make any loans to, or enter into any transaction, agreement, arrangement or understanding or any other nature with, any officer, director or employee of the Company. (r) Notice of Change. Seller will promptly advise Buyer in writing of any material adverse change, or the occurrence of any event which involves any substantial possibility of a material adverse change, in the business, financial condition, results of operations, assets, liabilities or prospects of the Company. (s) Consents. Seller will use their, and will cause the Company to use its, best good faith efforts to obtain the consent or approval of each person or entity whose consent or approval is required for the consummation of the Transactions contemplated hereby and to do all things necessary to consummate the Transactions contemplated by the Basic Agreements. 3.2 Covenants of Buyer. Buyer covenants and agrees that from the date hereof to the Closing without the prior written consent of Seller: (a) Ordinary Course of Business. Buyer will operate the business in the ordinary course and will use their best efforts to preserve the Company's business, organization, goodwill and relationships with persons having business dealings with them. (b) Maintain Properties. Buyer will maintain all of its properties in good working order, repair and condition (reasonable wear and use excepted) and cause all steps reasonably necessary to maintain in full force and effect its patents, trademarks, servicemarks, trade names, brand names, copyrights and other intangible assets. (c) Compensation. Buyer will not (1) enter into or alter any employment agreements; (2) grant any increase in compensation other than normal merit increases consistent with the Company's general prevailing practices to any officer or employee; or (3) enter into or alter any labor or collective bargaining agreement or any bonus or other employee fringe benefit. - 11 - (d) No Indebtedness. Buyer will not create, incur, assume, guarantee or otherwise become liable with respect to any obligation for borrowed money, indebtedness, capitalized lease or similar obligation, except in the ordinary course of business consistent with past practices where the entire net proceeds thereof are deposited with and used by and in connection with the business of the Company. (e) Maintain Books. Buyer will maintain its books, accounts and records in the usual, regular ordinary and sound business manner and in accordance with generally accepted accounting principles applied on a basis consistent with past practices. (f) No Amendments. Buyer will not amend its corporate charter or bylaws (or similar documents) without prior consent of Seller and will cause the Company to maintain its corporate existence, licenses, permits, powers and rights in full force and effect. (g) Taxes and Accounting Matters. Buyer will file when due all federal, state and local tax returns and reports which shall be accurate and complete, including but not limited to income, franchise, excise, ad valorem, and other taxes with respect to its business and properties, and to pay as they become due all taxes or assessments, except for taxes for which adequate reserves are established and which are being contested in good faith by appropriate proceedings. Buyer will not permit the Company to change their accounting methods or practices or any depreciation, amortization or inventory valuation policies or practices. (h) No Disposition or Encumbrance. Except in die ordinary course of business consistent with past practice, Buyer will not (1) dispose of or encumber any Of its properties and assets, (2) discharge or satisfy any lien or encumbrance or pay any obligation or liability (fixed or contingent) except for previously scheduled repayment of debt, (3) cancel or compromise any debt or claim, (4) transfer or grant any rights under any concessions, leases, licenses, agreements, patents, inventions, proprietary technology or process, trademarks, servicemarks or copyrights, or with respect to any know-how, or (5) enter into or modify in any material respect or terminate any existing license, lease, or contract. (i) Insurance. Buyer will maintain in effect all its current insurance policies. (j) No Securities Issuances. Buyer will not issue any shares of any class of capital stock, or enter into any contract, option, warrant or right calling for the issuance of any such shares of capital stock, or create or issue any securities convertible into any securities of the Buyer except for the transactions contemplated herein. (k) No Dividends. Buyer will not declare, set aside or pay any dividends or other distributions of any nature whatsoever. (l) Contracts. Buyer will not enter into or assume any contract, agreement, obligation, lease, license, or commitment except in the ordinary course of business consistent with past practice or as contemplated by this Agreement. - 12 - (m) No Breach. Buyer will not do any act or omit to do any act which would cause a breach of any contract, commitment or obligation. (n) Due Compliance. Buyer will comply with all laws, regulations, rules and ordinances applicable to it and to the conduct of its business. (o) No Waivers of Rights. Buyer will not amend, terminate or waive any material right whether or not in the ordinary course of business. (p) Capital Commitments. Buyer will not make or commit to make any capital expenditure, capital addition or capital improvement. (q) No Related Party Transactions. Buyer will not make any loans to, or enter into any transaction, agreement, arrangement or understanding or any other nature with, any officer, director or employee of the Buyer. (r) Notice of Change. Buyer will promptly advise Seller in writing of any material adverse change, or the occurrence of any event which involves any substantial possibility of a material adverse change, in the business, financial condition, results of operations, assets, liabilities or prospects of the Buyer. (s) Consents. Buyer will use its best good &M efforts to obtain the consent or approval of each person or entity whose consent or approval is required for the consummation of the Transactions contemplated hereby and to do all things necessary to consummate the Transactions contemplated by the Basic Agreements. IV. CONDITIONS PRECEDENT TO THE OBLIGATIONS OF BUYER TO CLOSE The obligation of Buyer to close the Transactions contemplated hereby is subject to the fulfillment by Seller prior to Closing of each of the following conditions, which may be waived in whole or in part by Buyer: 4.1 Compliance with Representations, Warranties and Covenant. The representations and warranties of Seller contained in this Agreement shall have been true and correct when made and shall be true and correct as of the Closing with the same force and effect as if made at the Closing. Seller shall have performed all agreements, covenants and conditions required to be performed by Seller prior to the Closing. 4.2 No Adverse Change. There shall have been no event which has had or may have a material adverse effect upon the business, financial condition, results of operation, assets, liabilities or prospects of the Company. - 13 - 4.3 No Legal Proceedings. No suit, action or other legal or administrative proceeding before any court or other governmental agency shall be pending or threatened seeking to enjoin the consummation of the Transactions contemplated hereby. 4.4 Documents to be Delivered by Seller. Seller shall have delivered the following documents: (a) Stock certificates representing all of the Shares, duly endorsed to Buyer and in blank or accompanied by duly executed stock powers, copies of which are attached as Exhibit "A". (b) A copy of (i) the Certificate of Incorporation of the Company, certified as correct by the Company, and (ii) the Bylaws of the Company certified as correct by the Company-, and (iii) a certificate of the Massachusetts Tax Commission, Franchise Tax Division, to the effect that the Company is in good standing and has paid all franchise taxes in such state, all as attached hereto as Exhibit 'N"; (c) All corporate and other records of or applicable to the Company included but not limited to, current and up-to-date minute books, stock transfer books and registers, books of accounts, leases and material contracts. (d) Such other documents or certificates as shall be reasonably required by Buyer or its counsel in order to close and consummate this Agreement. V. CONDITIONS PRECEDENT TO THE OBLIGATIONS OF SELLER TO CLOSE The obligation of Seller to close the Transactions is subject to the fulfillment prior to Closing of each of the following conditions, any of which may be waived in whole or in part by Seller: 5.1 Compliance with Representations, Warranties and Covenants. The representations and warranties made by Buyer in this Agreement shall have been true and correct when made and shall be true and correct in all material respects at the Closing with the same force and effect as if made at the Closing, and Buyer shall have performed all agreements, covenants and conditions required to be performed by Buyer prior to the Closing. 5.2 No Legal Proceedings. No suit, action or other legal or administrative proceedings before any court or other governmental agency shall be pending or threatened seeking to enjoin the consummation of the Transactions contemplated hereby. 5.3 Documents to be Delivered by Buyer. - 14 - (a) A copy of (i) the Certificate of Incorporation of the Buyer, certified as correct by the Buyer; and (ii) the Bylaws of the Buyer certified as correct by the Buyer; and (iii) a certificate of the Delaware Tax Commission, Franchise Tax Division, to the effect that the Buyer is in good standing and has paid all franchise taxes in such state. (b) All corporate and other records of or applicable to the Buyer included but not limited to, current and up-to-date minute books, stock transfer books and registers, books of accounts, leases and material contracts. (c) Such other documents or certificates as shall be reasonably required by Buyer or its counsel in order to close and consummate this Agreement. 5.4 Payments. Seller shall have received from Buyer all Common Stock to be issued at the Closing by Buyer. 5.5 No Adverse Change. There shall have been no event which has had or may have a material adverse effect upon the business, financial condition, results of operation, assets, liabilities or prospects of the Buyer. 5.6 Shares Price. The average market price per share of the Common Stock for the five trading days prior to the Closing shall be at least $0.3125 per share. 5.7 Certain Agreements. The Option Agreement with Universal Funding, Inc. and the Lock-Up Agreement with Universal Funding, Inc., Richard Singer and other persons identified by Sellers substantially in the forms attached hereto, shall have been duly executed and delivered to Sellers. VI. MODIFICATION, WAIVERS, TERMINATION AND EXPENSES 6.1 Modification. Buyer and Seller may amend, modify or supplement this Agreement in any manner as they may mutually agree in writing. 6.2 Waivers. Buyer and Seller may in writing extend the time for or waive compliance by the other with any of the covenants or conditions of the other contained herein. 6.3 Termination and Abandonment. This Agreement may be terminated and the purchase of the Shares may be abandoned before the Closing: (a) By the mutual consent of Seller and Buyer; (b) By Buyer, if the representations and warranties of Seller set forth herein shall not be accurate, or the conditions precedent set forth in Article IV shall have not have been satisfied, in all material respects; or - 15 - (c) By Seller, if the representations and warranties of Buyer set forth herein shall not be accurate, or the conditions precedent set forth in Article V shall not have been satisfied in all material respects. Termination shall be effective on the date of receipt of written notice specifying the reasons therefor. VII. MISCELLANEOUS 7.1 Representations and Warranties to Survive. Unless otherwise provided, all of the representations and warranties contained in this Agreement and in any certificate, exhibit or other document delivered pursuant to this Agreement shall survive the Closing for a period of two (2) years. No investigation made by any party hereto or their representatives shall constitute a waiver of any representation or warranty, and no such representation or warranty shall be merged into the Closing. 7.2 Binding Effect of the Basic Agreements. The Basic Agreements and the certificates; and other instruments delivered by or on behalf of the parties pursuant thereto, constitute the entire agreement between the parties. The terms and conditions of the Basic Agreements shall inure to the benefit of and be binding upon the respective heirs, legal representatives, successor and assigns of the parties hereto. Nothing in the Basic Agreements, expressed or implied, confers any rights or remedies upon any party other than the parties hereto and their respective heirs, legal representatives and assigns. 7.3 Applicable Law. The Basic Agreements are made pursuant to, and will be construed under, the laws of the State of New York. 7.4 Notices. All notices, requests, demands and other communications hereunder shall be in writing and will be deemed to have been duly given when delivered or mailed, first class postage prepaid: (a) If to Seller, to: Mr. Gregory Rotman Internet Auction, Inc. 4 Brussels Street Worcester, MA 01610 Telephone: (781) 575-6307 Fax: (781) 828-9517 With a copy to: Mr. Abba Polikoff - 16 - Gordon, Feinblatt, Rothman, Hoffberger & Hollander, LLC 233 E. Redwood Street Baltimore, MD 21202 Telephone: (410) 576-4000 Fax: (410) 576-4246 (b) If to Buyer, to: Mr. Richard Singer Securities Resolution Advisors, Inc. 80 Seaview Blvd. Port Washington, NY 10050 Telephone: (800) 501-7171 Fax: (516) 625-9854 With a copy to: Mr. G. David Gordon G. David Gordon & Associates, P.C. One Memorial Place 7633 East 63rd Place, Suite 210 Tulsa, OK 74133 Telephone: (918) 254-4997 Fax: (918) 254-2988 These addresses may be changed from time to time by written notice to the other parties. 7.5 Headings. The headings contained in this Agreement are for reference only and will not affect in any way the meaning or interpretation of this Agreement. 7.6 Counterparts. This Agreement may be executed in counterparts, each of which will be deemed an original and all of which together will constitute one instrument 7.7 Severability. If any one or more of the provisions of this Agreement shall, for any reason, be held to be invalid, illegal or unenforceable under applicable law this Agreement shall be construed as if such invalid, illegal or unenforceable provision had never been contained herein. The remaining provisions of this Agreement shall be given effect to the maximum extent then permitted by law. 7.8 Forbearance; Waiver. Failure to pursue any legal or equitable remedy or right available to a party shall not constitute a waiver of such right, nor shall any such forbearance, failure or actual waiver imply or constitute waiver of subsequent default or breach. 7.9 Attorneys' Fees and Expenses. The prevailing party in any legal proceeding based upon this Agreement shall be entitled to reasonable attorneys' fees and expenses and court costs. - 17 - 7.10 Expenses. Each party shall pay all fees and expenses incurred by it incident to this Agreement and in connection with the consummation of all transactions contemplated by this Agreement. 7.11 Integration. This Agreement and all documents and instruments executed pursuant hereto merge and integrate all prior agreements and representations respecting the Transactions, whether written or oral, and constitute the sole agreement of the parties in connection therewith. This Agreement has been negotiated by and submitted to the scrutiny of both Seller and Buyer and their counsel and shall be given a fair and reasonable interpretation in accordance with the words hereof without consideration or weight being given to its having been drafted by either party hereto or its counsel. IN WITNESS WHEREOF, the undersigned parties hereto have duly executed this Agreement on the date first written above. "BUYER" SECURITIES RESOLUTION ADVISORS, INC. By:/s/ Richard Singer ---------------------------------- Richard Singer, President "COMPANY" INTERNET AUCTION, INC. By:/s/ Gregory Rotman ---------------------------------- Gregory Rotman, President "SELLER" /s/ Gregory Rotman ------------------------------------- Gregory Rotman /s/ Richard Rotman ------------------------------------- Richard Rotman /s/ Marc Stengal ------------------------------------- Marc Stengal - 18 - EXHIBIT "A" 40,000 Shares - 19 - EXHIBIT "B" NONE - 20 - EXHIBIT "C" NONE - 21 - EXHIBIT "D" NONE - 22 - EXHIBIT "E" NONE - 23 - EXHIBIT "F" Company Logo and Software - 24 - EXHIBIT "G" NONE - 25 - EXHIBIT "H" TAXES FORM TAX PERIOD ENDED 1120 December 31, 1998 - 26 - EXHIBIT "I" NONE - 27 - EXHIBIT "J" NONE - 28 - EXHIBIT "K" TRANSACTIONS WITH CERTAIN PERSONS 1. SALE OF SECURITIES RESOLUTION ADVISORS, INC., A NEW YORK CORPORATION TO RICHARD SINGER - 29 - EXHIBIT "L" NONE - 30 - EXHIBIT "M" NONE 76813.636 T:2 - 31 - EX-2 3 EXHIBIT 2 - AGMT AS TO JOINT FILING OF SCH. 13D AGREEMENT AS TO JOINT FILING OF SCHEDULE 13D Each of the undersigned hereby affirms and agrees that this 13D is filed on their behalf. Dated: March 5, 1999 /s/ Gregory Rotman --------------------------- Gregory Rotman /s/ Richard Rotman --------------------------- Richard Rotman /s/ Marc Stengel ----------------------- Marc Stengel /s/ Hannah Kramer --------------------------- Hannah Kramer C76862.636 -----END PRIVACY-ENHANCED MESSAGE-----