{"id":42011,"date":"2015-09-17T11:25:58","date_gmt":"2015-09-17T16:25:58","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/contracts\/uncategorized\/agreement-and-plan-of-reorganization-euniverse.html"},"modified":"2015-09-17T11:25:58","modified_gmt":"2015-09-17T16:25:58","slug":"agreement-and-plan-of-reorganization-euniverse","status":"publish","type":"corporate_contracts","link":"https:\/\/corporate.findlaw.com\/contracts\/operations\/agreement-and-plan-of-reorganization-euniverse.html","title":{"rendered":"Agreement and Plan of Reorganization &#8212; eUniverse"},"content":{"rendered":"<pre>\n                     AGREEMENT AND PLAN OF REORGANIZATION\n\n\n     Agreement and Plan of Reorganization (the \"Agreement\") is made as of the\n1st day of July, 1999, by and among eUNIVERSE, INC., a Nevada corporation\n(\"EUI\"), GAMER'S ALLIANCE, INC., a Missouri corporation (\"GA\"), and Larry N.\nPevnick and Robin T. Pevnick, Ten Ent., residents of St. Louis County, Missouri,\nStan Goldenberg and Andrea R. Goldenberg, Ten Ent., residents of St. Louis\nCounty, Missouri (each individually, a \"GA Shareholder\" and collectively, the\n\"GA Shareholders\").\n\n                                   RECITALS:\n\n     1.   The GA Shareholders are the owners of all of the issued shares of the\ncapital stock of GA, consisting of the following shares of common stock, $1.00\npar value, of GA (collectively, the \"GA Shares\"):\n\n          GA Shareholder                                       No. of GA Shares\n          --------------                                       ----------------\n\n          Larry N. Pevnick and Robin T. Pevnick                    100 shares\n          Stan Goldenberg and Andrea R. Goldenberg                 100 shares\n\n     2.   EUI desires to acquire the GA Shares in exchange for certain shares of\ncommon stock, $.001 par value, of EUI (the \"EUI Shares\") as determined under\nthis Agreement, and the GA Shareholders desire to convey the GA Shares to EUI in\nexchange for certain EUI Shares.\n\n     3.   EUI, GA and the GA Shareholders have determined that it is desirable\nto effect a plan of reorganization (the \"Reorganization\") meeting the\nrequirements of Section 368(a) of the Internal Revenue Code of 1986, as amended,\nas more particularly described below.\n\n\n                                  AGREEMENT:\n\n     In consideration of the premises and mutual covenants and agreements\nhereinafter contained, the parties hereby agree as follows:\n\n1.   Certain Definitions.\n\n     1.1  Certain Definitions. As used in this Agreement, the following\n          -------------------\ncapitalized terms shall have the respective meanings set forth below:\n\n\"Code\" shall mean the Internal Revenue Code of 1986, as amended.\n ----\n\n\"ERISA\" shall mean the Employee Retirement Income Security Act of 1974, as\n -----\namended, and all rules and regulations issued thereunder, as amended.\n\n\n\"EUI Disclosure Schedule\" shall mean the disclosure schedule prepared and\n -----------------------\nexecuted by EUI and attached hereto as Schedule 1.\n\n\"Exchange Act\" shall mean the Securities Exchange Act of 1934.\n ------------\n\n\"GA Benefit Plans\" shall mean any and all employee benefit plans maintained or\n ----------------\ncontributed to by GA (including, without limitation, any \"employee benefit\nplan\", as defined in Section 3(3) of ERISA), and any material bonus, pension,\nprofit sharing, deferred compensation, incentive compensation, stock ownership,\nstock purchase, stock option, phantom stock, retirement, vacation, severance,\ndisability, death benefit, hospitalization, insurance or other plan, arrangement\nor understanding (whether or not legally binding).\n\n\"GA Business\" shall mean the business of creating and promoting Internet\n -----------\nwebsites related to the computer software games industry, as conducted by GA.\n\n\"GA Disclosure Schedule\" shall mean the disclosure schedule prepared and\n ----------------------\nexecuted by GA and attached hereto as Schedule 2.\n\n\"GA Intellectual Property\" shall mean any and all intellectual property\n ------------------------\n(including, without limitation, domain names, patents, patent rights, patent\napplications, trademarks, trademark applications, trade names, copyrights,\ndrawings, trade secrets, know-how and computer software) licensed or owned by GA\nor used by GA in the conduct of its business.\n\n\"GA Permits\" shall mean all permits, licenses and approvals of all Governmental\n ----------\nEntities (as defined hereinafter) necessary to lawfully conduct the GA Business.\n\n\"GA Personnel\" shall mean all personnel employed by GA.\n ------------\n\n\"GA Revenue\" shall mean the net revenue of GA (as determined by EUI's regular\n ----------\naccounting firm in accordance with GAAP).\n\n\"GAAP\" shall mean United States generally accepted accounting principles,\n ----\nconsistently applied.\n\n\"Governmental Entity\" shall mean any public body or authority, including courts\n -------------------\nof competent jurisdiction, domestic or foreign.\n\n\"Impressions\" shall mean all banner advertisements displayed on each new page\n -----------\nrequest from websites located within the GA network.\n\n\"Licenses\" shall mean all licenses, registrations, franchises, qualifications,\n --------\nprovider numbers, permits and authorizations issued by any Governmental Entity\nto GA for the operation of the GA Business including, without limitation, those\nlisted on Schedule 2.\n\n\"New Sites\" shall mean all websites either acquired or created by GA meeting the\n ---------\nminimum\n\n                                       2\n\n\nstandards of quality as defined and published by GA and as approved by EUI.\n\n\"Prepaid Expenses\" shall mean those actual prepaid expenses described in\n ----------------\nreasonable detail on Schedule 2, all of which have been prepaid by GA and\/or the\nGA Shareholders in connection with the GA Business.\n\n\"Securities Act\" shall mean the Securities Act of 1933.\n --------------\n\n\"Specified Exchange Act Filings\" shall mean, with respect to EUI, (i) the Form\n ------------------------------\n10 filed with the Securities and Exchange Commission (the \"Specified 10\") and\n(ii) each Quarterly Report on Form 10-Q and Current Report on Form 8-K filed\nwith the Securities and Exchange Commission since the filing of the Specified\n10.\n\n\"Taxes\" shall mean all taxes, assessments and governmental charges imposed by\n -----\nany federal, state, county, local or foreign government, taxing authority,\nsubdivision or agency thereof, including interest, penalties or additions\nthereto.\n\n\"Target No. 1\" shall mean GA's attainment (as reasonably determined by EUI) of\n ------------\nthe following levels, or levels in excess thereof, for the period from April 1,\n1999 through June 30, 1999:\n\n                      GA Revenue                      $130,000.00\n                      Unique Visitors                 2.7 million\n                      Impressions                     30 million\n                      New Sites                       12\n\n\"Target No.1 Contingent Consideration\" shall mean One Hundred Fifty Thousand\n ------------------------------------\nDollars ($150,000.00).\n\n\"Target No.2\" shall mean GA's attainment (as reasonably determined by EUI) of\n -----------\nthe following levels, or levels in excess thereof, for the period from July 1,\n1999 through September 30, 1999:\n\n                      GA Revenue                      $167,000.00\n                      Unique Visitors                 3 million\n                      Impressions                     34.5 million\n                      New Sites                       12\n\n\"Target No.2 Contingent Consideration\" shall mean One Hundred Fifty Thousand\n -----------\nDollars ($150,000.00).\n\n\"Target No.3\" shall mean GA's attainment (as reasonably determined by EUI) of\n -----------\nthe following levels, or levels in excess thereof, for the period from October\n1, 1999 through December 31, 1999:\n\n                      GA Revenue                      $200,000.00\n                      Unique Visitors                 3.6 million\n                      Impressions                     39.5 million\n\n                                       3\n\n\n\n\n\n\n                      New Sites                       12\n\n\"Target No.3 Contingent Consideration\" shall mean One Hundred Fifty Thousand\n ------------------------------------\nDollars ($150,000.00).\n\n\"Target No.4\" shall mean GA's attainment (as reasonably determined by EUI) of\n -----------\nthe following levels, or levels in excess thereof, for the period from January\n1, 2000 through March 31, 2000:\n\n                      GA Revenue                      $240,000\n                      Unique Visitors                 4.5 million\n                      Impressions                     45.5 million\n                      New Sites                       12\n\n\"Target No.4 Contingent Consideration\" shall mean Five Hundred Fifty Thousand\n ------------------------------------\nDollars ($550,000.00).\n\n\"Target No.5\" shall mean GA's attainment (as reasonably determined by EUI) of\n -----------\nall of the following levels, or levels in excess thereof, for the period from\nApril 1, 1999 through March 31, 2000:\n\n                      GA Revenue                      $737,000.00\n                      Unique Visitors                 13.3 million\n                      Impressions                     149.5 million\n                      New Sites                       48\n\n\"Target No.6\" shall mean GA's attainment (as reasonably determined by EUI) of\n -----------\namounts in excess of all of the following levels for the period from July 1,\n1999 through June 30, 2000:\n\n                      GA Revenue                      $1,133,750.00\n                      Unique Visitors                 20.625 million\n                      Impressions                     214.375 million\n                      New Sites                       60\n\n\"Target No.6 Contingent Consideration\" shall mean Two Hundred Fifty Thousand\n ------------------------------------\nDollars ($250,000.00).\n\n\"Unique Visitors\" shall mean unique individuals who access GA websites during a\n ---------------\nperiod of one month. Unique visitors is to be derived from counting unique\ncookies issued to viewers (which expire at the end of every month) upon their\nfirst monthly visit to a GA website.\n\n                                       4\n\n\n\n\n\n\n2.   Plan of Reorganization.\n\n     The Reorganization shall consist of the following transactions:\n\n     2.1  The closing of the transactions described in this Agreement (the\n\"Closing\") shall take place at 11:00 a.m. on June 30, 1999 (the \"Closing Date\")\nat the offices of Martin, Lois &amp; Gasparrini, LLC, 1177 Summer Street, Stamford,\nCT 06905. The Closing shall be effective as of 12:01 a.m. Stamford, Connecticut\ntime on July 1, 1999. At the Closing, GA Shareholders shall assign, transfer and\ndeliver all of the GA Shares to EUI.\n\n     2.2  At the Closing, EUI shall issue to the GA Shareholders seventy-eight\nthousand one hundred twenty-five (78,125) EUI Shares (the \"Initial EUI Shares\").\nThe number of Initial EUI Shares to be issued has been determined by dividing\nOne Million Dollars ($1,000,000.00) by $12.80 (the \"Share Price\") the average\nper share closing price of the EUI Shares (as reported on the OTC electronic\nbulletin board) for the five trading days immediately prior to EUI's public\nannouncement of the Reorganization. The Initial EUI Shares and any and all\nAdditional EUI Shares (as hereinafter defined) shall be issued to the GA\nShareholders in proportion to the number of GA Shares contributed to EUI by each\nGA Shareholder on the Closing Date. Within thirty (30) days after the Closing,\nEUI shall cause GA to repay the outstanding shareholder loans listed in the GA\nDisclosure Schedule in the amount of $30,000.\n\n     2.3  As further contingent consideration for the GA Shares exchanged\nhereunder, the GA Shareholders shall have the opportunity to receive additional\nEUI Shares (\"Additional EUI Shares\"), subject to the following terms and\nconditions of this Subsection 2.3. The number of Additional EUI Shares (if any)\nto be issued shall be determined, with respect to each Target hereinafter\ndefined, by dividing the appropriate amount of Contingent Consideration by the\nShare Price.\n\n          (a)  In the event that GA achieves any or all of the four components\ncomprising each of Target Nos. 1, 2, 3 or 4, then, within thirty (30) days\nfollowing the last day of the time period pertaining to such Target, EUI shall\nissue to the GA Shareholders Additional EUI Shares having a value of twenty-five\npercent (25%) of the Contingent Consideration for such Target for each such\ncomponent achieved. By way of example, (i) if only the GA Revenue and\nImpressions components of Target No. 2 are achieved, Seventy Five Thousand\nDollars ($75,000.00) worth of Additional EUI Shares shall be issued to the GA\nShareholders on or prior to November 30, 1999; and (ii) if the GA Revenue,\nUnique Visitors and New Sites components of Target No. 4 are achieved, Four\nHundred Twelve Thousand Five Hundred Dollars ($412,500.00) worth of Additional\nEUI Shares shall be issued to the GA Shareholders on or prior to April 30, 2000.\n\n          (b)  In the event that GA achieves all four components of Target No.\n5, then, on or prior to April 30, 2000, EUI shall issue to the GA Shareholders\nAdditional EUI Shares having a value equal to twenty-five percent (25%) of the\nContingent Consideration for each component of Target Nos. 1, 2 and 3 not\npreviously achieved.\n\n                                       5\n\n\n\n\n\n\n          (c)  In the event that GA achieves all four components of Target No.\n6, then, on or prior to July 30, 2000, EUI shall issue to the GA Shareholders\nAdditional EUI Shares having a value equal to Two Hundred Fifty Thousand Dollars\n($250,000.00).\n\n     2.4  At any time and from time to time during the term of this Agreement\nthrough January 1, 2001, EUI shall have the right, upon ten (10) days prior\nwritten notice to GA, to audit the books and records of GA as they relate to\nGA's achievement of the Targets. The GA Shareholders and GA shall (and GA shall\ncause the GA Personnel to) timely and fully cooperate with EUI in the\nperformance of any audit. This audit shall be done at EUI's expense; provided,\nhowever, that it such audit reveals a variation for the figures reported by GA\nexceeding ten percent (10%), then the expenses of such audit shall be borne by\nthe GA Shareholders.\n\n3.   Representations and Warranties of EUI.\n\n     EUI represents and warrants to the GA Shareholders (which representations\nand warranties shall survive the Closing for the applicable statute of\nlimitations) as follows:\n\n     3.1  Organization. Each of EUI and its subsidiaries is a corporation or\n          ------------\nother legal entity duly organized, validly existing and in good standing under\nthe laws of the jurisdiction of its formation and has all requisite power and\nauthority to own, lease and operate its properties and to carry on its business\nas now being conducted. Each of EUI and its subsidiaries is duly qualified or\nlicensed and in good standing to do business in each jurisdiction in which the\nproperty owned, leased or operated by it or the nature of the business conducted\nby it makes such qualification or licensing necessary, except in such\njurisdictions where the failure to be so duly qualified or licensed and\/or in\ngood standing would not in the aggregate have a material adverse effect on the\nbusiness, operations or financial condition of EUI or its subsidiaries. EUI has\nheretofore delivered to GA and the GA Shareholders complete copies of the\ncharter and bylaws, as currently in effect, of EUI and each of its subsidiaries.\n\n     3.2  Capitalization.\n          --------------\n\n          (a)  The authorized capital stock of EUI consists of 250,000,000\nshares of common stock, $.001 par value, and 50,000,000 shares of preferred\nstock, $.10 par value, of which, as of June 23, 1999, there were 14,809,598\nshares of common stock issued and outstanding and there were 1,832,912 shares of\nSeries A 6% convertible preferred stock issued or outstanding. All the issued\nand outstanding EUI Shares are validly issued, fully paid and nonassessable and,\nexcept as set forth in Section 3.2(a) of the EUI Disclosure Schedule, free of\npreemptive rights. All EUI Shares which are to be issued pursuant to the\nReorganization will be, when issued in accordance with the terms thereof, duly\nauthorized, validly issued, fully paid and nonassessable and free of any\npreemptive rights in respect thereto. Except as set forth above, or as may be\nissued from time to time pursuant to the EUI Stock Awards Plan, or as disclosed\nin Section 3.2(a) of the EUI Disclosure Schedule, or as contemplated hereby or\nthereby, there are not now, and on the Closing Date there will not be, any\nshares of capital stock (or securities substantially equivalent to capital\nstock) of EUI issued or outstanding or any subscriptions,\n\n                                       6\n\n\n\n\n\n\n\noptions, warrants, calls, rights, convertible securities or other agreements or\ncommitments of any character obligating EUI to issue, transfer or sell any of\nits securities.\n\n          (b)  Section 3.2(b) of the EUI Disclosure Schedule sets forth the\nname, jurisdiction of formation and capitalization of each subsidiary of EUI.\nAll of the outstanding shares of capital stock, or other forms of ownership\ninterests, of each of EUI's subsidiaries have been validly issued and are fully\npaid and nonassessable and, except as set forth in Section 3.2(b) of the EUI\nDisclosure Schedule, are owned either by EUI and\/or another of its subsidiaries\nfree and clear of all liens, charges, claims or encumbrances.\n\n     3.3  Authority Relative to this Agreement. EUI has full corporate power and\n          ------------------------------------\nauthority to execute and deliver this Agreement and to consummate the\ntransactions contemplated hereby. The execution and delivery of this Agreement\nand the consummation of the transactions contemplated hereby have been duly and\nvalidly authorized by the Board of Directors of EUI, and no other corporate\nproceedings on the part of EUI are necessary to authorize this Agreement or to\nconsummate the transactions so contemplated.  This Agreement has been duly and\nvalidly executed and delivered by EUI and constitutes a valid and binding\nagreement of EUI, enforceable against EUI in accordance with its terms.\n\n     3.4  Consents and Approvals; No Violations. Except for applicable\n          -------------------------------------\nrequirements of the Exchange Act, the Securities Act and state Blue Sky laws, no\nfiling with, and no permit, authorization, consent or approval of, any\nGovernmental Entity is necessary for the consummation by EUI of the transactions\ncontemplated by this Agreement; provided that in making this representation EUI\nis relying on and this representation is conditioned upon the accuracy of the\nrepresentations and warranties of GA and the GA Shareholders in Section 4 of\nthis Agreement. Except as set forth in Section 3.4 of the EUI Disclosure\nSchedule, neither the execution and delivery of this Agreement by EUI nor the\nconsummation by EUI of the transactions contemplated hereby nor compliance by\nEUI with any of the provisions hereof will (i) conflict with or result in any\nbreach of any provision of the charter or bylaws of EUI; (ii) result in a\nviolation or breach of, or constitute (with or without due notice or lapse of\ntime or both) a default (or give rise to any right of termination, cancellation\nor acceleration) under, any of the terms, conditions or provisions of any note,\nbond, mortgage, indenture, license, contract, agreement or other instrument or\nobligation to which EUI or any of its subsidiaries is a party or by which any of\nthem or any of their properties or assets may be bound; or (iii) to the best\nknowledge of the officer executing this Agreement on behalf of EUI, violate any\norder, writ, injunction, decree, statute, treaty, rule or regulation applicable\nto EUI, any of its subsidiaries or any of their properties or assets, except in\nthe case of (ii) or (iii) for violations, breaches or defaults which are not\nmaterial to the business, operations or financial condition of EUI or its\nsubsidiaries and which will not prevent or delay the consummation of the\ntransactions contemplated hereby.\n\n     3.5  Specified Exchange Act Filings. To the best knowledge of the officer\n          ------------------------------\nexecuting this Agreement on behalf of EUI (as to all matters addressed in this\nSection 3.5), EUI has made all filings with the SEC required by federal law or\nthe applicable rules and regulations of the SEC thereunder. EUI has delivered to\nGA and the GA Shareholders a copy of each of its\n\n                                       7\n\n\n\n\n\n\nSpecified Exchange Act Filings. Each Specified Exchange Act Filing, at the time\nfiled, (i) did not contain any untrue statement of a material fact or omit to\nstate a material fact required to be stated therein or necessary in order to\nmake the statements therein, in light of the circumstances under which they were\nmade, not false or misleading and (ii) complied as to form in all material\nrespects with the applicable requirements of the Exchange Act and the applicable\nrules and regulations of the SEC thereunder. Since the filing with the SEC by\nEUI of its Form 10 on June 14, 1999, there has been no material adverse change\nin the business, assets, operations or financial condition of EUI or its\nsubsidiaries.\n\n4.   Representations and Warranties of GA and the GA Shareholders.\n\n     The GA Shareholders jointly and severally represent and warrant to EUI\n(which representations and warranties shall survive the Closing for the\napplicable statute of limitations) as follows:\n\n     4.1  Organization. GA is a corporation duly organized, validly existing and\n          ------------\nin good standing under the laws of the State of Missouri and has all requisite\npower and authority to own, lease and operate its properties and to carry on the\nGA Business as now being conducted and to perform the terms of this Agreement\nand the transactions contemplated herein. GA is duly qualified or registered and\nin good standing to do business in each jurisdiction in which the property\nowned, leased or operated by it or the nature of the business conducted by it\nmakes such qualification or licensing necessary, except in such jurisdictions\nwhere the failure to be so duly qualified or licensed and in good standing would\nnot in the aggregate have a material adverse effect on the GA Business or the\nassets, operations or financial condition of GA.\n\n     4.2  Capitalization, Stock Ownership.\n          -------------------------------\n\n          (a)  The authorized capital stock of GA consists of 30,000 shares of\ncommon stock, $ 1.00 par value, of which, as of the date of this Agreement, 200\nare issued and outstanding. All the issued and outstanding GA Shares are validly\nissued, fully paid and nonassessable and free of preemptive rights. As of the\ndate of this Agreement, no GA Shares were issuable upon exercise of options, and\nGA had no incentive stock option plan or any nonqualified employee stock option\nplan. As of the date of this Agreement, no GA Shares were issuable upon exercise\nof warrants. Except as set forth above, there are not now, and on the Closing\nDate there will not be, any shares of capital stock (or securities substantially\nequivalent to capital stock) of GA issued or outstanding or any subscriptions,\noptions, warrants, calls, rights, convertible securities or other agreements or\ncommitments of any character obligating GA to issue, transfer or sell any of its\nsecurities, except as provided by this Agreement.\n\n          (b)  GA does not own, directly or indirectly, any capital stock or\nother equity securities of any corporation or have any direct or indirect equity\nor ownership interest in any business. There are not now, and on the Closing\nDate there will not be, any voting trusts or other\n\n                                       8\n\n\n\n\n\n\nagreements or understandings to which GA is a party or is bound with respect to\nthe voting of the capital stock of GA. There are no entities in which GA has any\nvoting rights or equity interests.\n\n               (c)  The GA Shareholders are the beneficial and record owners of\nall of the GA Shares, free and clear of any liens, encumbrances or restrictions\non transfer of any nature whatsoever other than the obligations arising under\nthis Agreement. Except for this Agreement and the transactions contemplated\nhereby, none of the GA Shareholders has any legal obligation, absolute or\ncontingent, to any person or firm to sell any of the GA Shares or enter into any\nagreement with respect thereto.\n\n     4.3  Authority Relative to this Agreement. GA has full corporate power and\n          ------------------------------------\nauthority to execute and deliver this Agreement and to consummate the\ntransactions contemplated hereby. The execution and delivery of this Agreement\nand the consummation of the transactions contemplated hereby have been duly and\nvalidly authorized by GA and the GA Shareholders, and no other corporate\nproceedings on the part of GA are necessary to authorize this Agreement or to\nconsummate the transactions so contemplated. This Agreement constitutes a valid\nand binding agreement of GA and the GA Shareholders, enforceable against GA and\nthe GA Shareholders in accordance with its terms.\n\n     4.4  Consents and Approvals; No Violations. No filing with, and no permit,\n          -------------------------------------\nauthorization, consent or approval of, any Governmental Entity is necessary for\nthe consummation by GA and\/or the GA Shareholders of the transactions\ncontemplated by this Agreement. Neither GA nor any of the GA Shareholders is\naware of any such requirements. Neither the execution and delivery of this\nAgreement by GA and\/or the GA Shareholders nor the consummation by GA and\/or the\nGA Shareholders of the transactions contemplated hereby will (i) conflict with\nor result in any breach of any provision of the Certificate of Incorporation or\nbylaws of GA, (ii) result in a violation or breach of, or constitute a default\n(or give rise to any right of termination, cancellation or acceleration) under,\nany of the terms, conditions or provisions of any note, bond, mortgage,\nindenture, license, contract, agreement or other instrument or obligation to\nwhich GA and\/or any GA Shareholder is a party or by which GA and\/or any GA\nShareholder or any of their respective properties or assets may be bound, or\n(iii) violate any order, writ, injunction, decree, statute, treaty, rule or\nregulation applicable to GA and\/or any GA Shareholder or any of their respective\nproperties or assets.\n\n     4.5  Reports.\n          -------\n\n               (a)  None of the GA Reports (as defined hereinafter) contain any\nuntrue statement of a material fact or omit to state a material fact necessary\nin order to make the statements therein not misleading. Each of the balance\nsheets and related statements (including any related notes) included in the GA\nReports presents fairly the consolidated financial position of GA as of the\nrespective dates thereof, and present fairly the results of operations and the\nchanges in financial position of GA for the respective periods, except, in the\ncase of unaudited interim financial statements, for year-end audit adjustments,\nconsisting only of normal year end adjustments. The GA Reports are in accordance\nwith the books and records of GA, and have been prepared in accordance with\nGAAP, consistently applied.\n\n                                       9\n\n\n\n\n\n\n            (b) GA has delivered to EUI copies of unaudited compiled financial\nstatements (including statements of income and a balance sheet) for GA for the\nfour months ended April 30, 1999 (attached hereto at Section 4.5 of Schedule 2),\nand unaudited monthly statements of income and a balance sheet for GA for each\nmonth thereafter to and including the month ended June 30, 1999 (collectively,\nthe \"GA Reports\").\n\n     4.6    No Material Adverse Changes. Except as set forth in Section 4.6\n            ---------------------------\nof the GA Disclosure Schedule, since April 30, 1999 there has not been any:\n\n            (a) material adverse change in the GA Business, or the financial\ncondition, assets, liabilities or earnings of GA and to the best knowledge of\nGA, there is no fact, circumstance, event, occurrence, contingency or condition\nwhich should reasonably be expected to result in any material adverse change in\nthe GA Business or the assets, financial or other condition, operations,\nliabilities or prospects of GA;\n\n            (b) change in the number of shares of capital stock of GA issued or\noutstanding or any declaration, setting aside, or payment of any dividend or\nother distribution (whether in cash, securities, property or otherwise) in\nrespect of GA's capital stock;\n\n            (c) other than increases in salary or bonus of less than 5% to each\nemployee of GA, (i) increase in the compensation payable or to become payable to\nany GA Personnel or (ii) any bonus, incentive compensation, service award or\nother like benefit, granted, made or accrued, contingently or otherwise, to the\ncredit of any GA Personnel;\n\n            (d) mortgage, pledge or subjection to any lien or encumbrance of any\ncharacter whatsoever of any of the assets of GA, except the lien of current\nTaxes incurred but not yet due and payable;\n\n            (e) sale, assignment or transfer of any assets of GA that are\nmaterial, singly or in the aggregate to GA other than in the ordinary course of\nbusiness;\n\n            (f) waiver of any rights of substantial value to GA, whether or not\nin the ordinary course of business;\n\n            (g) cancellation or termination by GA of any contract, agreement or\nother instrument to which GA is or was a party, which cancellation or\ntermination has caused or could reasonably be expected to cause a loss of\nexpected revenue to GA of more than $25,000;\n\n            (h) liability incurred by GA except liabilities incurred in the\nordinary course of business;\n\n            (i) capital expenditures or the execution of any lease other than\nleases of personal property in the ordinary course with respect to any aspect of\nthe GA Business or the incurring of any liability therefor;\n\n                                      10\n\n\n\n\n\n\n            (j) borrowing of money by GA or guaranteeing by GA of any\nindebtedness of others;\n\n            (k) lending of any money by GA or otherwise pledging the credit of\nGA;\n\n            (l) failure to conduct the business of GA in the ordinary course;\n\n            (m) change in the method of accounting or accounting practice of GA\nfrom the methods and practice used to prepare the April 30, 1999 financial\nstatements;\n\n            (n) loss of services of any GA Personnel that is material to the\nconduct of the GA Business;\n\n            (o) material cancellation by any supplier or contractor to GA;\n\n            (p) cancellation by any customer or customers which have caused or\ncould reasonably be expected to cause a loss of expected revenue to GA of more\nthan $ 25,000;\n\n            (q) extraordinary item of loss (as defined in Opinion No. 30 of the\nAccounting Principles Board of the American Institute of Certified Public\nAccountants); or\n\n            (r) agreement by GA to do any of the foregoing.\n\n     4.7    Lists of Properties, Contracts, Etc. Sections 4.7(a) through 4.7(k)\n            ------------------------------------\nof the GA Disclosure Schedule contain accurate lists and summary descriptions of\nthe following:\n\n            (a) Section 4.7(a) of the GA Disclosure Schedule. Qualification. All\n                                                              -------------\njurisdictions in which GA is a registered foreign corporation;\n\n            (b) Section 4.7(b) of the GA Disclosure Schedule. Real Property and\n                                                              -----------------\nLeases. All leases of real property to which GA is a party (indicating in each\n- ------\nsuch case, the terms of the lease) and all premises occupied by GA under rental\narrangements without leases (including in each case the amount of rent and the\ntype of occupancy (collectively, the \"Leased Premises\").\n\n            (c) Section 4.7(c) of the GA Disclosure Schedule. Intellectual\n                                                              ------------\nProperty. To the best knowledge of GA, all GA Intellectual Property;\n- --------\n\n            (d) Section 4.7(d) of the GA Disclosure Schedule. Personal Property.\n                                                              -----------------\nExcept for individual items having a fair market value of less than $5,000\n(subject to a maximum fair market value of $50,000 for all such individual items\nin the aggregate), each item of machinery, inventory, equipment, computer\nhardware, motor vehicles, office furniture, fixtures and similar personal\nproperty and furnishings owned or leased by GA indicating the current\ndepreciated book value of owned items and the terms and annual lease payments of\nleased items;\n\n                                      11\n\n\n\n\n\n\n            (e) Section 4.7(e) of the GA Disclosure Schedule. Insurance. All\n                                                              ---------\npolicies of insurance in force with respect to GA, including, without\nrestricting the generality of the foregoing, those covering properties,\nbuildings, machinery, inventory, equipment, furniture, fixtures, operations and\nlives of, or performance of their duties by, GA Personnel, including the policy\nnumbers, names and addresses of insurers, expiration dates, descriptions and\namounts of coverage and annual premiums\nas of the date hereof;\n\n            (f) Section 4.7(f) of the GA Disclosure Schedule. Other Contracts.\n                                                              ---------------\nAll material contracts and commitments not otherwise listed in any other\nschedule hereto of GA (including, without limitation, confidentiality\nagreements, purchase orders, agreements, undertakings or commitments to any\ngovernmental or regulatory authority, agreements with salespersons, and other\nagreements with customers and suppliers). Section 4.7(f) also contains\ndescriptions of each existing oral agreement or arrangement of GA (other than\nagreements or arrangements that do not involve, individually, more than $15,000\nper year in revenue or expense). Except for oral agreements or arrangements that\ndo not involve, individually, more than $25,000 per year in revenue or expense,\nand, in the aggregate, more than $100,000 per year in revenue or expense, GA has\nno obligations or liabilities under any oral agreements or arrangements that\nhave not been disclosed to EUI;\n\n            (g) Section 4.7(g) of the GA Disclosure Schedule. Labor Agreements.\n                                                              ----------------\nAll labor contracts, employment agreements and GA Benefit Plans with respect to\nGA;\n\n            (h) Section 4.7(h) of the GA Disclosure Schedule. Powers of\n                                                              ---------\nAttorney. The names of all persons holding powers of attorney from GA;\n- --------\n\n            (i) Section 4.7(i) of the GA Disclosure Schedule. Indebtedness. All\n                                                              ------------\nnotes, debentures, bonds, letters of credit and other instruments evidencing\nindebtedness (including capital leases, guarantees and lines of credit) of GA;\n\n            (j) Section 4.7(j) of the GA Disclosure Schedule. Bank Accounts.\n                                                              -------------\nThe name of each institution in which GA has a bank account, safe-deposit box,\nthe number of any such account or box, and the names of all persons authorized\nto draw thereon or to have access thereto; and\n\n            (k) Section 4.7(k) of the GA Disclosure Schedule. Credit Cards. The\n                                                              ------------\nname of each institution with whom GA has credit cards, debit cards or similar\ncharge accounts or lines of credit, the identifying account numbers for each\nsuch card, account or line of credit and the names of all persons authorized to\nuse, draw upon or have access to such cards, accounts or lines of credit.\n\n            (l) Copies of Documents. GA has previously delivered to EUI or\n                -------------------\notherwise made available for EUI's inspection true and complete copies of:\n\n                (i)   all leases, agreements, contracts, undertakings,\ncommitments and arrangements listed in Sections 4.7(b), 4.7(d), 4.7(f) and\n4.7(g) of the GA Disclosure Schedule;\n\n                                      12\n\n\n\n\n\n\n                (ii)  all agreements or written materials with respect to the\nGA Intellectual Property listed in Section 4.7(c) of the GA Disclosure Schedule;\n\n                (iii) all policies of insurance listed in Section 4.7(e) of the\nGA Disclosure Schedule;\n\n                (iv)  all instruments evidencing a power of attorney listed in\nSection 4.7(h) of the GA Disclosure Schedule; and\n\n                (v)   all securities, notes, debentures, bonds, letters of\ncredit and other instruments of indebtedness listed in Section 4.7(i) of the GA\nDisclosure Schedule.\n\n     4.8    Title to Properties. Except as otherwise disclosed in Section 4.8 of\n            -------------------\nthe GA disclosure Schedule, (i) GA has good and marketable title to all of its\nproperties and assets, real and personal, tangible and intangible; (ii) such\nproperties and assets referred to in clause (i) of this Section are free and\nclear of all liens and encumbrances of any character whatsoever, except of the\nlien of Taxes not yet due and payable; (iii) GA has valid and enforceable leases\nwith respect to the Leased Premises, has performed all the obligations required\nto be performed by it under said leases and possesses and quietly enjoys said\npremises under said leases, and such premises are not subject to any liens,\nencumbrances, easements, rights of way, building or use restrictions,\nexceptions, reservations or limitations that interfere with or impair the\npresent and continued use thereof in the usual and normal conduct of the\nbusiness of GA. GA has not has received notice of violation of any applicable\nzoning regulation, ordinance or other law, order, regulation or requirement\nrelating to the operations of the Leased Premises, and GA knows of no such\nviolation. GA has not received notice of any pending or threatened condemnation\nproceedings relating to any of the Leased Premises, and to the best knowledge of\nGA, there are no such pending or threatened proceedings. The tangible properties\nand equipment owned, operated or leased by GA are in good operating condition,\nordinary wear and tear excepted, and, to the best knowledge of GA, are in\nconformity in all material respects with all applicable laws, ordinances,\norders, regulations and other requirements (including applicable zoning,\nenvironmental, occupational safety and health laws and regulations) presently in\neffect or presently scheduled to take effect. GA does not own any of the\nbuildings, plants or structures located on the Leased Premises or any other real\nproperty and is not a party to any contract, and does not hold any options, for\nthe purchase of any real property. The tangible properties and equipment owned,\noperated or leased by GA and the real property leased by GA are all the tangible\nand real properties necessary to operate the GA Business in the manner currently\noperated by GA.\n\n     4.9    No Default. Except as set forth in Section 4.9 of the GA Disclosure\n            ----------\nSchedule, GA is not in default or violation (and no event has occurred which\nwith notice or the lapse of time or both would constitute a default or\nviolation) of any term, condition or provision of (i) its Certificate of\nIncorporation or its bylaws, (ii) any note, bond, mortgage, indenture, license,\ncontract, agreement or other instrument or obligation to which GA is a party or\nby it or to which any of its properties or assets may be bound or (iii) any\norder, writ, injunction, decree, statute, rule or regulation applicable to GA.\n\n                                      13\n\n\n\n\n\n\n     4.10   Litigation. Except as disclosed in Section 4.10 of the GA Disclosure\n            ----------\nSchedule, there is no action, suit, proceeding, tax audit, investigation or\nreview pending or threarened with respect to GA, the GA Business, any of the\nassets of GA, the GA Shares, or any of the transactions contemplated hereby\nbefore any Governmental Entity, or otherwise at law or in equity, which\nindividually or in the aggregate are reasonably likely to (i) have a material\nadverse effect on the assets, business, operations or financial condition of GA\nor (ii) prevent or impair the consummation of the transactions contemplated\nhereby. GA is not in default with respect to any order, writ, injunction or\ndecree of any court or Federal, state, municipal or other governmental\ndepartment, commission, board, bureau, agency or instrumentality which, if not\ncured, should reasonably be expected to (i) have a material adverse effect upon\nthe GA Business, or the assets, operations and financial condition of GA, or\n(ii) prevent or impair the consummation of the transactions contemplated hereby.\n\n     4.11   Compliance with Applicable Law. GA holds all GA Permits, except for\n            ------------------------------\nsuch GA Permits which would not have a material adverse effect on the GA\nBusiness or the assets, operations or financial condition of GA. GA is in\ncompliance with the terms of all GA Permits, except where the failure to so\ncomply would not have a material adverse effect on the GA Business or the\nassets, operations or financial condition of GA. The GA Business is not being\nconducted in violation of any applicable law, ordinance, rule, regulation,\ndecree or order of any Governmental Entity, except for violations which do not\nand would not have a material adverse effect on the GA Business, or the assets,\noperations or financial condition of GA.\n\n     4.12   Taxes. Except as set forth in Section 4.12 of the GA Disclosure\n            -----\nSchedule, GA has correctly prepared and timely filed all material federal,\nstate, local and foreign tax returns, estimates and reports, including payroll\nand sales tax reports (collectively, the \"Returns\") required to be filed by it,\nand GA has duly paid, caused to be paid or made adequate provision for the\npayment of all Taxes required to be paid in respect of the periods covered by\nthe Returns and has established on its books and records reserves that are\nadequate for payment of all Taxes anticipated to be payable in respect of all\ncalendar periods since the periods covered by the Returns. All deficiencies and\nassessments asserted by federal, state, local or foreign taxing authorities have\nbeen paid, fully settled or adequately provided for in the financial statements\ncontained in the GA Reports. Except as set forth in Section 4.12 of the GA\nDisclosure Schedule, there are no outstanding agreements or waivers extending\nthe statutory period of limitation applicable to any federal or foreign income\ntax return of GA. GA has complied in all material respects with all applicable\nlaws, rules and regulations relating to the payment and withholding of taxes and\nhas timely and properly withheld from employees' wages and paid over to the\nproper governmental authorities all amounts required to be so withheld and paid\nover under applicable laws.\n\n     4.13   ERISA and GA Benefit Plans.\n            --------------------------\n\n            (a) With respect to any and all GA Benefit Plans, GA has provided to\nEUI a true and correct copy of, where applicable, (i) the most recent annual\nreport, if any, (Form 5500) filed with the IRS, (ii) each GA Benefit Plan, (iii)\neach trust agreement and group annuity\n\n                                      14\n\n\n\n\n\n\ncontract, if any, relating to such GA Benefit Plan and (iv) the most recent\nactuarial report or valuation relating to a GA Benefit Plan subject to Title IV\nof ERISA, if any. None of the GA Benefit Plans are multiemployer plans within\nthe meaning of Section 3(37) of ERISA. Each of the GA Benefit Plans covered by\nERISA, if any (i) has been operated in all material respects in accordance with\nERISA, (ii) has not engaged in any prohibited transactions (as such term is\ndefined in Section 406 of ERISA) and (iii) has met the minimum funding standards\nof Section 412 of the Code. No material Reportable Event (within the meaning of\nSection 4043 of ERISA) has occurred and is continuing with respect to any GA\nBenefit Plan. Since the enactment of ERISA, GA has not terminated any pension\nplan or withdrawn from any multiemployer pension plan.\n\n            (b) With respect to the GA Benefit Plans, no event has occurred, and\nto the knowledge of GA there exists no condition or set of circumstances which\nare reasonably likely to occur, in connection with which GA would be subject to\nany liability (except liability for benefits claims and funding obligations\npayable in the ordinary course) under ERISA, the Code or any other applicable\nlaw.\n\n            (c) Except as set forth in Section 4.13(c) of the GA Disclosure\nSchedule, with respect to the GA Benefit Plans, there are no funded benefit\nobligations for which contributions have not been made or properly accrued and\nthere are no unfunded benefit obligations which have not been accounted for by\nreserves, or otherwise properly footnoted in accordance with generally accepted\naccounting principles, on the financial statements of GA, which obligations are\nreasonably likely to have a material adverse effect on the GA Business or the\nassets, operations or financial condition of GA.\n\n            (d) Except as set forth in Section 4.13(d) of the GA Disclosure\nSchedule, and as required by law, GA does not maintain, and is not required to\ncontribute to and has no liabilities with respect to, any GA Benefit Plan and no\nGA Personnel or dependent thereof is entitled to any benefits from GA. All GA\nBenefit Plans have been maintained and operated in material compliance with\ntheir terms and applicable law. Except as set forth on the GA Disclosure\nSchedule, no individual is a party to an employment contract pertaining to the\nGA Business that will be effective on the Closing Date.\n\n            (e) Except as set forth in Section 4.13(e) of the GA Disclosure\nSchedule, the transactions contemplated by this Agreement (either alone or\ntogether with any other transaction) will not (i) entitle any GA Personnel to\nseverance pay or other similar payments, (ii) accelerate the time of payment or\nvesting or increase the amount of benefits or compensation due to any GA\nPersonnel or (iii) result in any payments (including parachute payments)\nbecoming due to any GA Personnel.\n\n            (f) GA has complied in all material aspects with all applicable\nlaws, rules and regulations relating to the employment of labor, including those\nrelating to wages, hours, collective bargaining and the payment of social\nsecurity and similar Taxes.\n                                     15\n\n\n\n\n\n\n            (g) GA is not an employer subject to the Worker Adjustment and\nRetraining Notification Act.\n\n            (h) There are no GA Personnel who are entitled to (i) any pension\nbenefit that is unfunded or (ii) any pension or other benefit to be paid upon\ntermination of employment other than as required by Section 601 of ERISA, and no\nother benefits whatsoever are payable to any GA Personnel after termination of\nemployment (including retiree medical and death benefits).\n\n            (i) In connection with the operation of the GA Business, (i) there\nis no significant labor trouble, labor strike, material controversy, material\nslowdown or stoppage actually pending against or affecting GA and, to the best\nknowledge of GA, none is or has been threatened, and (ii) GA has no collective\nbargaining agreements with respect to any GA Personnel.\n\n            (j) Section 4.13(j) of the GA Disclosure Schedule sets forth the\nname, location, title, date of employment, salaries, bonuses (and any changes in\nsalaries or bonuses since April 30, 1999 other than increases in salary or bonus\nof less than 5% to each employee of GA). Except as set forth on Section 4.13(j)\nof the GA Disclosure Schedule, no employee of GA whose annual rate of income\n(including salary and bonus) is greater than $50,000 has terminated, or has\nprovided notice to GA of his or her intention to terminate, his or her\nrelationship with GA. GA has no knowledge of any plan of any employee of GA to\ndo so.\n\n     4.14   Small Business Issues. None of the existing business relationships\n            ---------------------\nof GA are based on or are the result of any agreement, understanding or\nrelationship arising out of or relating to GA's status as a \"small business\nconcern\" or \"minority-owned business concern\" or other similar status, as such\nterms or similar terms are used under applicable federal or state law.\n\n     4.15   Intellectual Property. Except as set forth in Section 4.15 of the GA\n            ---------------------\nDisclosure Schedule, (i) no claim is pending or, to the best knowledge of GA,\nthreatened to the effect that the present or past operations of GA infringes\nupon or conflicts with the rights of others with respect to any GA Intellectual\nProperty, and (ii) no claim is pending or, to the best knowledge of GA,\nthreatened to the effect that any of GA's rights to the GA Intellectual Property\nis\/are invalid or unenforceable. To the best knowledge of GA, no contract,\nagreement or understanding with any party exists which would impede or prevent\nthe continued use by GA of the entire right, title and interest of GA in and to\nany GA Intellectual Property. The GA Intellectual Property listed in Section\n4.7(c)of the GA Disclosure Schedule consists of all GA Intellectual Property\nused or being developed for use in the GA Business or necessary for the conduct\nof the GA Business. GA has all right, title and interest in and to the GA\nIntellectual Property, free and clear of any encumbrances. No person has a right\nto receive a royalty with respect to any of the GA Intellectual Property listed\nin Section 4.7(c)of the GA Disclosure Schedule. GA has no licenses granted by or\nto it or other agreements to which it is a party relating in whole or in part to\nany GA Intellectual Property, whether owned by GA or otherwise. GA is not\ninfringing upon or otherwise violating the rights of any third party with\nrespect to any GA Intellectual Property or using any of the GA Intellectual\nProperty in a manner that would give rise to an obligation to render an\naccounting to any person as a result of co-authorship, co-invention or an\nexpress or\n                                      16\n\n\n\n\n\n\nimplied contract for any use or transfer thereof. GA has taken all reasonable\nmeasures to secure and to protect confidential business information and the\ntrade secrets of GA. GA has not sent or otherwise communicated to any other\nperson any notice, charge, claim or assertion of, or has any knowledge of, any\npresent, impending or threatened infringement by such other person of any GA\nIntellectual Property or misappropriation of any GA Intellectual Property by\nsuch other person.\n\n     4.16   Change in Control. Except as set forth in Section 4.16 of the GA\n            -----------------\nDisclosure Schedule, GA is not a party to any contract, agreement or\nunderstanding which contains a \"change in control\" provision or \"potential\nchange in control\" provision.\n\n     4.17   Insurance. All policies of insurance (or renewals thereof) set forth\n            ---------\nin Section 4.7(e)of the GA Disclosure Schedule are outstanding and duly in force\non the date hereof. Such policies are in the amounts shown in Section 4.7(e) of\nthe GA Disclosure Schedule, and insure the structures and equipment of GA for\ntheir replacement values against loss, theft and destruction and insure the\nproperties and business of GA against such losses and risks as are adequate in\naccordance with customary industry practice to protect the properties and\nbusiness of GA. GA has not received notice from any insurer or agent of such\ninsurer that substantial capital improvements or other expenditures will have to\nbe made in order to continue such insurance, and no such improvements or\nexpenditures are required.\n\n     4.18   Accounts Receivable. The accounts receivables shown on the GA\n            -------------------\nReports are less than sixty (60) days due, are valid debts owed to GA and are\nnot in dispute. GA has adequately and properly established reserves for\ncollectability on the GA Reports.\n\n     4.19   Business Plan. The twelve (12) month forecast and projections\n            -------------\nprovided to EUI is set forth on the GA Disclosure Schedule and such forecast and\nprojections represent the best judgment of GA as to the likely results of\noperations and the assumptions underlying such forecast and projections, and the\nforecasts contained therein are reasonable.\n\n     4.20   Licenses. Except as set forth in Section 4.20 of the GA Disclosure\n            --------\nSchedule, to the best knowledge of GA and the GA Shareholders, no Licenses are\nrequired for GA to own and operate the GA Business in the manner operated on the\ndate hereof. The Licenses are in full force and effect and have been validly\nissued. As of the date hereof, no action or proceeding is pending or, to the\nbest knowledge of GA and the GA Shareholders, threatened before any Governmental\nEntity to revoke, refuse to renew or modify such Licenses or other\nauthorizations of the GA Business.\n\n     4.21   Brokers. Neither this Agreement nor the conveyance of the GA Shares\n            -------\nor any other transaction contemplated by this Agreement was induced or procured\nthrough any person acting on behalf of or representing GA and\/or any of the GA\nShareholders as broker, finder, investment banker, financial advisor or in any\nsimilar capacity.\n\n     4.22   Powers of Attorney. There are no persons holding a power of attorney\n            ------------------\non behalf of any GA Shareholder(s) which would enable such persons to sell any\nGA Shares.\n\n                                      17\n\n\n\n\n\n\n     4.23   Prepaid Expenses. All of the Prepaid Expenses set forth on Schedule\n            ----------------\n2 have been paid by GA prior to the date hereof and relate to good faith\nexpenses incurred by GA in connection with the conduct of the GA Business.\n\n5.   Continued Accuracy of Representations and Warranties.\n\n     All representations and warranties of the parties contained herein shall be\ntrue in all material respects at and as of the Closing Date with the same effect\nas though such representations and warranties were made at and as of such time;\nand each party shall have performed and complied with all obligations,\ncovenants, and conditions required by this Agreement to have been performed or\ncomplied with by it prior to or on the Closing Date.\n\n6.   Covenants of the Parties.\n\n     6.1    Covenants of EUI. EUI covenants and agrees that the Operating Budget\n            ----------------\nof GA for the period commencing on the Closing Date and ending June 30, 2000 as\nset forth in Section 6. 1 of the GA Disclosure Schedule (the \"GA Operating\nBudget\") has been approved by EUI. EUI shall implement the GA Operating Budget\nfrom and after the Closing and shall not make any material changes to the GA\nOperating Budget without the consent of the GA Shareholders. EUI covenants and\nagrees that during the period commencing on the Closing Date and ending June 30,\n2000, GA shall be maintained as a subsidiary corporation and that the reporting\nrelationship of the President of GA shall be to the Chief Executive Officer of\nEUI.\n\n     6.2    Covenants of GA Shareholders.\n            ----------------------------\n\n            (a) The GA Shareholders understand and agree that the EUI Shares and\n                the Additional Shares received hereunder are not registered\n                under the Securities Act of 1933 (the \"1933 Act\") and such\n                shares shall not be resold except pursuant to a registration\n                statement under the 1933 Act or an exemption thereunder.\n\n            (b) The GA Shareholders covenant and agree that the domain names\n                listed in the GA Disclosure Schedule not currently owned by GA\n                shall be transferred with full title, free and clear of any\n                encumbrances, to GA on or before 60 days following the Closing.\n\n7.   Indemnification.\n\n     7.1    Obligation of the GA Shareholders to Indemnify. The GA Shareholders\n            ----------------------------------------------\nshall, jointly and severally, indemnify, defend and hold harmless EUI from and\nagainst any and all losses, judgments, claims, awards, damages, settlements,\ncosts and expenses, including, without limitation, attorneys fees, sustained or\nincurred by EUI as a result or arising out of any the following: (i) the breach\nof any representation, warranty or covenant of the GA Shareholders, or\n\n                                      18\n\n\n\n\n\n\neach of them, contained herein or in any agreement or document executed and\ndelivered in connection with the transactions contemplated herein or (ii) the GA\nBusiness prior to the Closing or any other business of the GA Shareholders, or\neach of them, or any act, omission, debt, obligation or liability of the GA\nShareholders, or each of them, their agents, contractors, employees, officers,\ndirectors.\n\n     7.2    Obligation of EUI to Indemnify. EUI shall indemnify, defend and hold\n            ------------------------------\nharmless the GA Shareholders from and against any and all losses, judgments,\nclaims, awards, damages, settlements, costs and expenses, including, without\nlimitation, attorneys' fees, sustained or incurred by the GA Shareholders as a\nresult of EUI's breach of any representation, warranty or covenant of EUI in\nthis Agreement.\n\n     7.3    Notice to Indemnifying Party. If any party (the \"Indemnitee\")\n            ----------------------------\nreceives notice of any third-party claim or of the commencement of any action or\nproceeding or becomes aware of the occurrence of any event with respect to which\nany other party (or parties) (the \"Indemnifying Party\") is required to provide\nindemnification pursuant to Section 7.1 or 7.2, the Indemnitee shall promptly\ngive the Indemnifying Party notice thereof. The Indemnifying Party may take\ncontrol of the defense, settlement or compromise of such claim, action or\nproceeding at the Indemnifying Party's own expense and with the assistance of\nthe Indemnifying Party's own counsel, which counsel shall be reasonably\nacceptable to the Indemnitee. If the Indemnifying Party chooses to defend any\nclaim, the Indemnitee shall make available to the Indemnifying Party any books,\nrecords or other documents within its control that are necessary or appropriate\nfor such defense, and shall otherwise cooperate fully with the Indemnifying\nParty. The Indemnitee shall also have the right to participate in any defense\nand\/or settlement of a claim at Indemnitee's expense and may, if the\nIndemnifying Party shall not choose to defend or resist said claim within twenty\n(20) days after notice thereof from the Indemnitee (or such shorter time\nspecified in the notice as the circumstances of the matter may dictate), dispose\nof the matter at the reasonable cost of the Indemnifying Party in any way it\nreasonably deems to be in its best interest.\n\n8.   Conditions Precedent to the Obligations of the Parties.\n\n     8.1    Conditions Precedent to the Obligations of EUI. The obligations of\n            ----------------------------------------------\nEUI to effect the Reorganization are further subject to the satisfaction at or\nprior to the Closing Date of the following conditions, unless waived by EUI in\nwriting:\n\n            (a) The representations and warranties of GA and the GA Shareholders\nset forth in this Agreement shall be true and correct as of the date of this\nAgreement, and shall also be true and correct (except for such changes as are\ncontemplated by the terms of this Agreement) on and as of the Closing Date with\nthe same force and effect as though made on and as of the Closing Date.\n\n                                      19\n\n\n\n\n\n\n            (b) From the date of this Agreement through the Closing Date, GA\nshall not have suffered any adverse material changes in the GA Business or the\nassets, operations or financial condition of GA (other than changes relating to\nthe transactions contemplated by this Agreement, including the change in control\ncontemplated hereby).\n\n            (c) GA and the GA Shareholders shall have performed all obligations\nand covenants and conditions required to be performed by it and them under this\nAgreement at or prior to the Closing Date.\n\n            (d) GA shall have furnished EUI with copies of (i) resolutions duly\nadopted by the Board of Directors of GA approving the execution and delivery of\nthis Agreement and all other necessary or proper corporate action to enable GA\nto comply with the terms of this Agreement, and (ii) resolutions duly adopted by\nthe GA Shareholders approving and adopting this Agreement and the\nReorganization, such resolutions to be certified by the Secretary or Assistant\nSecretary of GA.\n\n            (e) GA shall have no outstanding debt (other than reasonable and\ncustomary accounts payable incurred in the ordinary course of business).\n\n            (f) GA shall have one hundred ninety-five thousand dollars\n($195,000) excess of current assets over current liabilities as shown on GA's\nfinancial statements as of the Closing Date prepared in accordance with GAAP,\nsubject to normal year end adjustments. Such excess shall be comprised of (i)\nnon-disputed accounts receivables due less than sixty days and (ii) cash of at\nleast five thousand dollars ($5,000).\n\n            (g) GA shall have provided to EUI a business plan for the period\ncommencing on the Closing Date and ending June 30, 2000 following the Closing\nDate satisfactory in form and substance to EUI.\n\n            (h) GA shall have provided to EUI an appraisal of GA's assets by an\nindependent third party appraiser reasonably acceptable to EUI, which appraisal\nis satisfactory in form and substance to EUI.\n\n            (i) GA shall have caused each of Adam Goldenberg, Lorien Newman and\nMatthew Rowell to have executed and delivered to GA a transfer of domain name\nagreement substantially in the form attached hereto as Exhibits E through G\n(collectively, the \"Transfer Agreements\").\n\n            (j) GA shall have furnished EUI with an opinion (the \"GA Opinion\"),\ndated the Closing Date, of counsel to GA, in form and substance satisfactory to\nEUI and its counsel, to the effect that:\n\n                (i)    GA is a corporation duly incorporated, validly\nexisting and in good standing under the laws of the State of Missouri;\n\n                                      20\n\n\n\n\n\n\n\n                (ii)   the authorized capital stock of GA consists of 30,000\nshares of common stock, $ 1.00 par value, and the GA Shares issued and\noutstanding on the date hereof were validly issued and outstanding, fully paid\nand nonassessable and none of such issued and outstanding GA Shares were issued\nin violation of any preemptive rights of shareholders of GA, and between the\ndate hereof and the Closing Date no additional shares of stock of GA have been\nissued;\n\n                (iii)  GA has taken all required corporate action to approve and\nadopt this Agreement, and this Agreement is a valid and binding obligation of GA\nenforceable against GA and the GA Shareholders in accordance with its terms,\nsubject as to enforcement to bankruptcy, reorganization, moratorium, insolvency\nand other laws of general applicability relating to or affecting creditors'\nrights and to general equity principles;\n\n                (iv)   the execution and delivery of this Agreement by GA and\nthe GA Shareholders does not, and the consummation of the transactions\ncontemplated by this Agreement by GA and the GA Shareholders will not,\nconstitute (i) a breach or violation of, or a default under, the charter or\nbylaws of GA, or (ii) a breach, violation or impairment of, or a default under,\nany judgment, decree, order, statute, law, ordinance, rule or regulation now in\neffect applicable to the GA Shareholders, GA or its properties known to such\ncounsel, or any agreement, indenture, mortgage, lease or other instrument of GA;\n\n                (v)    all filings required to be made by GA prior to or on the\nClosing Date with, and all consents, approvals, permits or authorizations\nrequired to be obtained by GA prior to or on the Closing Date from, Governmental\nEntities in connection with the execution and delivery of this Agreement by GA\nand the GA Shareholders and the consummation of the transactions contemplated by\nthis Agreement by GA and the GA Shareholders, have been so made or obtained, as\nthe case may be;\n\n                (vi)   except as otherwise disclosed in the GA Disclosure\nSchedule, such counsel does not know of any litigation, proceedings, arbitral\naction or governmental investigation pending against GA, its assets, business or\nproperties, the GA Shares, the GA Shareholders or the transactions contemplated\nby this Agreement;\n\n                (vii)  the employment agreements with Adam Goldenberg, Matt\nRowell, Tony Wyss and the consulting agreement with Larry Pevnick, substantially\nin the form attached hereto as Exhibits A through D, respectively (collectively,\nthe \"Employment Agreements\"), have been duly executed and delivered by the\nemployees stated therein and are valid and binding obligations of the employees\nstated therein enforceable against the employees stated therein in accordance\nwith their terms, subject as to enforcement to bankruptcy, reorganization,\nmoratorium and other laws of general applicability relating to or affecting\ncreditors' rights and to general equity principles; and\n\n                (viii) the Transfer Agreements with Adam Goldenberg, Lorien\nNewman and Matthew Rowell, respectively, have been duly executed and delivered\nby the employees stated therein and are valid and binding obligations of the\npersons stated therein enforceable\n\n                                      21\n\n\n\n\n\n\nagainst the persons stated therein in accordance with their terms, subject as to\nenforcement of bankruptcy, reorganization, moratorium and other laws of general\napplicability relating to or affecting creditors' rights and to general equity\nprinciples.\n\nIn rendering the GA Opinion, such counsel may rely on certificates of officers\nand other agents of GA and public officials as to matters of fact and, as to\nmatters relating to the law of jurisdictions other than Missouri, upon opinions\nof counsel of such other jurisdictions reasonably satisfactory to EUI and its\ncounsel, provided such reliance is expressly noted in the GA Opinion and the\nopinions of such other counsel and the certificates of such officers, agents and\npublic officials relied on are attached to the GA Opinion.\n\n            (j) GA shall have received all credit and debit cards listed on the\nGA Disclosure Schedule.\n\n            (k) GA shall have delivered to EUI (i) one or more certificates\nrepresenting the GA Shares, free and clear of all liens and encumbrances of any\nnature whatsoever, duly endorsed in blank for transfer or accompanied by stock\npowers duly executed in blank and with all requisite documentary or stock\ntransfer tax stamps affixed and (ii) the official and complete corporate records\nof GA (including, without limitation, the minute books, stock ledger and by-laws\nof GA and the official corporate seal of GA).\n\n            (l) GA shall have delivered to EUI written resignations, effective\nas of the Closing Date, of each person that is a director or officer of GA from\nsuch officer or director.\n\n            (m) GA shall have delivered to EUI unaudited monthly statements of\nincome and a balance sheet for GA for each month after April 30, 1999, to and\nincluding the month ended June 30, 1999.\n\n            (n) All actions, proceedings, instruments and documents required to\ncarry out this Agreement, or incidental hereto, and all other legal matters\nshall have been approved by counsel to EUI, and such counsel shall have received\nall documents, certificates and other papers reasonably requested by it in\nconnection therewith.\n\n            (o) The GA Shareholders shall state, and reaffirm as of the Closing\nDate, that the materials, including current financial statements, prepared and\ndelivered by EUI to the GA Shareholders, have been read and understood by the GA\nShareholders, that they are familiar with the business of EUI, that they are\nacquiring the EUI Shares under Section 4(2), commonly known as the private\noffering exemption of the Securities Act, and that the EUI Shares are restricted\nand may not be resold, except in reliance on an exemption under the Securities\nAct.\n\n     8.2    Conditions Precedent to Obligations of GA. The obligations of GA to\n            -----------------------------------------\neffect the Reorganization are subject to the satisfaction at or prior to the\nClosing Date of the following conditions, unless waived by GA in writing:\n\n                                      22\n\n\n\n\n\n\n            (a) The representations and warranties of EUI set forth in this\nAgreement shall be true and correct as of the date of this Agreement, and shall\nalso be true in all material respects (except for such changes as are\ncontemplated by the terms of this Agreement) on and as of the Closing Date with\nthe same force and effect as though made on and as of the Closing Date, except\nif and to the extent any failures to be true and correct would not have a\nmaterial adverse effect on EUI.\n\n            (b) From the date of this Agreement through the Closing Date, except\nas set forth in the EUI Disclosure Schedule, EUI shall not have suffered any\nadverse changes in its business, operations or financial condition which are\nmaterial to EUI (other than changes generally affecting the industries in which\nEUI operates, including changes due to actual or proposed changes in law or\nregulation).\n\n            (c) EUI shall have materially performed all obligations required to\nbe performed by it under this Agreement at or prior to the Closing Date.\n\n            (d) EUI shall have furnished GA with copies of (i) resolutions duly\nadopted by its Boards of Directors approving the execution and delivery of this\nAgreement and all other necessary or proper corporate action to enable them to\ncomply with the terms of this Agreement, and (ii) to the extent required\npursuant to EUI's charter or bylaws, resolutions duly adopted by the holders of\nthe EUI Shares approving the issuance of the EUI Shares, such resolutions to be\ncertified by the Secretary or Assistant Secretary of EUI.\n\n            (e) EUI shall have furnished GA with an opinion (the \"EUI Opinion\"),\ndated the Closing Date, of counsel to EUI, in form and substance satisfactory to\nGA and its counsel, to the effect that:\n\n                (i)    EUI is a corporation duly incorporated, validly existing\nand in good standing under the laws of the State of Nevada;\n\n                (ii)   EUI has the corporate power to carry on its business as\nit is being conducted on the Closing Date;\n\n                (iii)  the EUI Shares are validly issued and outstanding, fully\npaid and nonassessable;\n\n                (iv)   EUI has taken all required corporate action to approve\nand adopt this Agreement, and this Agreement is a valid and binding obligation\nof EUI, enforceable in accordance with its terms, subject as to enforcement of\nbankruptcy, reorganization, moratorium, insolvency and other laws of general\napplicability relating to or affecting creditors' rights and to general equity\nprinciples;\n\n                (v)    the execution and delivery of this Agreement by EUI do\nnot, and the consummation of the transactions contemplated by this Agreement by\nEUI will not, constitute (i) a breach or violation of, or a default under, the\ncharter or bylaws of EUI, or (ii) a\n\n                                      23\n\n\n\n\n\n\nbreach, violation or impairment of, or a default under, any judgment, decree,\norder, statute, law, ordinance, rule or regulation now in effect applicable to\neither EUI or EUI's properties known to such counsel, or any agreement,\nindenture, mortgage, lease or other instrument of either or to which EUI is\nsubject and in each case known to such counsel;\n\n                (vi)   all filings required to be made by EUI prior to or on the\nClosing Date with, and all consents, approvals, permits or authorizations\nrequired to be obtained by EUI prior to or on the Closing Date from,\ngovernmental and regulatory authorities of the United States and the State of\nNevada in connection with the execution and delivery of this Agreement by EUI\nand the consummation of the transactions contemplated by this Agreement have\nbeen so made or obtained, as the case may be; and\n\n                (vii)  the Employment Agreements have been duly executed and\ndelivered by EUI and are valid and binding obligations of EUI, enforceable\nagainst EUI in accordance with their terms, subject as to enforcement to\nbankruptcy, reorganization, moratorium and other laws of general applicability\nrelating to or affecting creditors' rights and to general equity principles.\n\nIn rendering the EUI Opinion, such counsel may rely on certificates of officers\nand other agents of EUI and public officials as to matters of fact and, as to\nmatters relating to the law of jurisdictions other than Nevada, upon opinions of\ncounsel of such other jurisdictions reasonably satisfactory to GA and its\ncounsel, provided such reliance is expressly noted in the EUI Opinion and the\nopinions of such other counsel and the certificates of such officers, agents and\npublic officials relied on are attached to the EUI Opinion.\n\n            (f) All actions, proceedings, instruments and documents required to\ncarry out this Agreement, or incidental hereto, and all other legal matters\nshall have been approved by counsel to GA, and such counsel shall have received\nall documents, certificates and other papers reasonably requested by it in\nconnection therewith.\n\n9.   Closing.\n\n     The Closing of the Reorganization shall take place on the Closing Date, or\non such other date as the parties may mutually agree. All shares of capital\nstock to be delivered hereunder shall be duly endorsed or with duly executed\nstock powers attached, in either case in proper form for transfer, and in\naccordance with all necessary corporate action.\n\n10.  Termination.\n\n     This Agreement shall terminate upon the occurrence of any of the following:\n\n     (a) the written agreement of all parties to this Agreement;\n     (b) the bankruptcy, receivership or dissolution of GA; or\n     (c) the failure to satisfy any of the conditions precedent as provided in\nSection 6 above, in which case this Agreement shall be null and void and the\nparties shall have no further obligations hereunder, provided that the parties\nhave used reasonable efforts to satisfy such conditions\n\n                                      24\n\n\n\n\n\n\nprecedent; and provided, however, that the parties obligations under Section\n11.9 herein shall survive termination of this Agreement.\n\n11.  Miscellaneous.\n\n     11.1   Successors and Assigns. This Agreement shall be binding upon and\n            ----------------------\nshall inure to the benefit of each of the parties hereto and their respective\nheirs, legal representatives, successors and assigns, and shall also be binding\non all persons who have or claim an interest in any shares of capital stock of\nGA.\n\n     11.2   Entire Agreement. This Agreement constitutes the entire\n            ----------------\nunderstanding between the parties and no modification, discharge or waiver, in\nwhole or in part, of any of the provisions contained herein or therein shall be\nvalid unless in writing and signed by the parties.\n\n     11.3   Headings. The paragraph headings in this Agreement are for\n            --------\nconvenience of reference and do not constitute part of the agreement.\n\n     11.4   Validity. If any provision of this Agreement is found to be invalid\n            --------\nor unenforceable, such provision shall be, and shall be deemed to be, modified\nso as to cure the invalidity or unenforceability, and all other provisions of\nthis Agreement shall be enforceable notwithstanding such invalidity or\nunenforceability.\n\n     11.5   Governing Law; Consent to Jurisdiction. This Agreement shall be\n            --------------------------------------\nconstrued and enforced in accordance with the laws of the State of Connecticut.\n\n     11.6   Enforcement. In the event that either party hereto commits a breach\n            -----------\nof that party's obligations hereunder, the non-breaching party damaged thereby\nshall be entitled to recover from the party in breach the costs and expenses\nincurred, including reasonable attorneys' fees and disbursements, in connection\nwith enforcing the provisions hereof. The obligation of any person to transfer\nshares in accordance with the terms of this Agreement may be specifically\nenforced by any court of competent jurisdiction, it being acknowledged and\nagreed that money damages will not provide an adequate remedy for the breach of\nany such obligation. The rights and remedies set forth in this subsection shall\nbe in addition to, and not in lieu of, any other rights and remedies available\nat law or in equity.\n\n     11.7   Notices. All notices and other communications hereunder shall be in\n            -------\nwriting (and shall be deemed given upon receipt) if delivered personally,\ntelecopied (which is confirmed) or mailed by registered or certified mail\n(return receipt requested) to the parties at the following addresses (or at such\nother address for a party as shall be specified by like notice):\n\n            (a)  if to EUI, to\n\n                    eUniverse, Inc.\n\n                                      25\n\n\n\n\n\n\n                    100 North Industrial Plains Road\n                    Wallingford, CT 06492\n\n                    Attention:  President\n\n                 with a copy to\n\n                    Christopher G. Martin, Esq.\n                    Martin, Lois &amp; Gasparrini, LLC\n                    1177 Summer Street\n                    Stamford, CT  06905\n\n            (b)  if to GA or GA Shareholders, to\n\n                    Gamer's Alliance, Inc.\n                    14013 Boxford Ct.\n                    Chesterfield, MO  63017\n\n                    Attention:  Larry N. Pevnick\n\n                 with a copy to:\n\n                    Jeffrey Michelman, Esq.\n                    Blumenfeld, Kaplan and Sandweiss, P.C.\n                    168 N. Meramec Ave.\n                    St. Louis, Mo. 63105\n\n     11.8   Waivers. No waiver by a party, or by anyone claiming by, through or\n            -------\nunder such party, of any right or of the breach of any representation, warranty,\ncovenant, agreement, condition or duty, shall ever be held or construed as a\nwaiver of the same or any other right or waiver of any other breach of the same\nor of any representation, warranty, covenant, agreement, condition, or duty. In\nthe event of a breach by a party of any representation, warranty, covenant,\nagreement, condition or duty, the failure by any other party to take action on\naccount of such breach or to enforce any rights resulting therefrom shall not be\ndeemed a waiver, and such breach shall be a continuing breach until the same has\nbeen cured. No waiver of any of the provisions of this Agreement shall be deemed\nor shall constitute a continuing waiver unless otherwise expressly provided\ntherein.\n\n     11.9   Confidentiality. GA shall not, and GA shall use its best efforts to\n            ---------------\nensure that all GA Personnel do not, discuss with or disclose to any company\nother than GA or any individual other than GA Personnel any term or terms of\nthis Agreement or that certain letter of intent between EUI and GA dated May 3,\n1999.\n\n     11.10  Arbitration. Any claim or dispute arising under this Agreement that\n            -----------\ncannot be resolved through negotiation among the parties shall be determined by\narbitration before a single\n\n                                      26\n\n\n\n\n\n\narbitrator in Fairfield County, Connecticut, in accordance with the Commercial\nArbitration rules then obtaining of the American Arbitration Association,\nincluding the production of documents and other information in accordance with\nRule 10 thereof. No demand for arbitration shall, however, be instituted after\nthe date after which legal proceedings on the same claim would have been barred\nby the applicable statute of limitations. The arbitrator shall take such steps\nas the arbitrator may deem necessary or desirable to avoid delay and to achieve\na just, speedy and cost-effective resolution of the matter. The award rendered\nin such arbitration may provide for equitable remedies, an accounting and\/or\nreimbursement for attorneys', accountants' or consultants' fees, as the\narbitrator shall see fit. Such award shall be final, and judgment on it may be\nentered in or enforced by any court, state, federal or foreign, with competent\njurisdiction. Any party may apply to the arbitrator or an appropriate court of\nlaw for a preliminary injunction, attachment or other provisional remedy\navailable to it in aid of the arbitration proceeding provided for herein. This\nprovision shall not preclude the impleading or joining of one of the parties\nhereto by the other in an action brought by a third party.\n\n\n                  __________________________________________\n\n\n                   Signatures appear on the following page.\n\n                                      27\n\n\n\n\n\n\n     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be\nexecuted as of the date first above written.\n\n\n                              eUNIVERSE, INC.\n\n\n\n                              By \/s\/ William R. Wagner\n                                 --------------------------------\n\n                              Its CFO\n\n                              GAMER'S ALLIANCE, INC.\n\n\n\n                              By \/s\/ Larry N. Pevnick\n                                 --------------------------------\n\n                              Its Chief Executive Officer\n\n\n                              GA SHAREHOLDERS:\n                              ---------------\n\n                              \/s\/ Larry N. Pevnick and Robin T. Pevnick\n                              --------------------------------------------------\n                              Larry N. Pevnick and Robin T. Pevnick, Ten Ent.\n\n\n                              \/s\/ Stan Goldenberg and Andrea R. Goldenberg\n                              --------------------------------------------------\n                              Stan Goldenberg and Andrea R. Goldenberg, Ten Ent.\n\n\n\n                                      28\n\n\n\n\n\n\n\n<\/pre>\n","protected":false},"template":"","meta":{"_acf_changed":false,"_stopmodifiedupdate":true,"_modified_date":"","_cloudinary_featured_overwrite":false},"corporate_contracts_companies":[7885],"corporate_contracts_industries":[9497],"corporate_contracts_types":[9618,9613],"class_list":["post-42011","corporate_contracts","type-corporate_contracts","status-publish","hentry","corporate_contracts_companies-intermix-media-inc","corporate_contracts_industries-retail__electronics","corporate_contracts_types-operations__reorg","corporate_contracts_types-operations"],"acf":[],"_links":{"self":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts\/42011","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts"}],"about":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/types\/corporate_contracts"}],"wp:attachment":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/media?parent=42011"}],"wp:term":[{"taxonomy":"corporate_contracts_companies","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_companies?post=42011"},{"taxonomy":"corporate_contracts_industries","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_industries?post=42011"},{"taxonomy":"corporate_contracts_types","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_types?post=42011"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}