October 20, 2000
Xxxxxxx Xxxxx
0000 Xxx Xxx Xxxxxx.,
Xxxxx 000
Xxxxxx Xxx Xxx, XX 00000
RE: Private Common Stock
Dear Xx. Xxxxx
This letter expresses the intent of US Xxxxxx.xxx, Inc. a Washington
corporation (the "Company") to sell a certain number of shares of the
common stock of the Company, and WorldNet Resource Group, Inc. a Utah
corporation ("Purchaser"), to purchase such shares of the Company. This
letter of intent ("Letter of Intent") and the provisions contained herein
are not binding on the parties unless specifically so stated, except to the
extent that they reflect the present intent of the parties to enter into
further negotiations and attempt to develop a mutually satisfactory
definitive written agreement for the sale and purchase of the common stock
of the Company, in a form mutually satisfactory to Purchaser and Company
("Definitive Agreement").
The parties undertake in good faith to attempt to negotiate and execute
with deliberate speed, a Definitive Agreement, which will cover the general
items, contained in the attached Private Offering Term Sheet (the term of
which are incorporated herein by this reference) and those items below. The
Definitive Agreement will contain all representations, warranties,
covenants, agreements and indemnities customary for transactions of this
type and provide for obtaining all corporate and other consents and
approvals that may be necessary to consummate the transaction. Unless and
until such a Definitive Agreement is executed in writing by the parties
hereto, neither Purchaser nor the Company shall be under any obligation on
the other regarding the transactions which are the subject of this Letter
of Intent except for the agreement contained below in Paragraph 2 through
4, regardless of any negotiations or understandings arising subsequent to
the date of this Letter of Intent, unless otherwise mutually agreed to in
writing.
The provisions set forth below reflect the general understanding between
the Purchaser and the Company to provide guidance in the drafting of
appropriate provisions in the Definitive Agreement. Our understanding are
as outlined in the attached Private Offering Term Sheet and as follows.
1. Common Stock to be purchased. Purchaser will purchase from the
Company shares of the Company's common stock as follow:
Date No.of Shares Purchase Price Price per Share
---------------------------------------------------------------------
11/05/00 250,000 $250,000 $1.00
12/15/00 750,000 $750,000 $1.00
2/01/01 1,134,260 $1,134,260 $1.00
Total: 2,134,260 $2,134,260 $1.00
2. Confidentiality: Purchaser and the Company agree not to disclose
or use, and not to permit their respective representatives to disclose
or use, any Confidential Information furnished, to be furnished or
otherwise acquired or obtained in connection with the purchase and
sale of the common stock discussed herein ("Acquisitions") at any time
or in any manner, except in connection with the evaluation of the
Acquisitions. Each party shall, and shall cause its representatives
to, take any and all measures and precautions necessary or advisable
to safeguard the Confidential Information of the other party and
prevent the unauthorized use or disclosure thereof. Each party shall
disclose the Confidential Information of the other party disclosure
thereof. Each party shall disclose the Confidential Information of
the other party only to those of its representatives who need to know
such Confidential Information for the purpose of evaluating the
Acquisitions, and shall only disclose such portion of the Confidential
Information of the other party to any such representatives as is
necessary for the representative to make the evaluation required of
him. "Confidential Information" means any and all information,
records, files, agreements, contracts, or other documentation
concerning Purchaser, or the Company, as the case may be: provided
that it does not include information which (i) is generally available
to or known by the public other than as a result of improper
disclosure by the receiving party or (ii) is obtained by the receiving
party from a source other than the furnishing party, provided that
such source was not bound by a duty of confidentially to the
furnishing party or another party with respect to such information.
3. Return of Information: In the event that the Acquisition is not
consummated, for any reason whatsoever, each party shall immediately
return to the party its Confidential Information and any notes or
other material compiled from or related to such Confidential
Information.
4. Public Disclosure: Except as and to the extent requires by law,
without the prior Written consent of the other party, neither
Purchaser nor the Company will, and each will direct its
representatives not to make, directly or indirectly any public
comment, statement, or communication with respect to, or otherwise to
disclose or to permit the disclosure of the existence of discussion
regarding a possible transaction among Purchaser and the Company or
any of the terms, conditions, or other aspects of the transactions
proposed in this Letter of Intent. If a party is requires by law to
make any such disclosure, it must first provide to the other party the
content of the proposed disclosure, the reason that such disclosure is
required by law, and the time and place that the disclosure will be
made.
5 Assignment: Neither party may assign its rights or delegate its
obligations under this Letter of Intent without the prior written
consent of the other party.
6. No Third Party Beneficiaries: This Letter of Intent is not
intended to, and shall not, Benefit any person or entity not a party
to this Letter of Intent.
7. Governing Law. This Letter of Intent and Definitive Agreement
shall be governed by and construed in accordance with the internal
laws of the State of Washington without regard to its conflict of laws
principles.
If you are in agreement with the foregoing, please sign and return one copy
of this Letter of Intent to the undersigned, which thereupon will
constitute our understanding with respect to its subject matter.
Very truly your,
US Xxxxxx.Xxx, Inc.
------------------------
Xxxxxx X. Xxxxx, President
The undersigned xxxxxx accepts and agrees to the terms of the foregoing
Letter of Intent on this day of October, 2000.
WORLDNET RESOURCE GROUP, INC.
------------------------------
BY: Xxxxxxx Xxxxx, Chairman
Private Offering Term Sheet
$2,134,260 Common Stock Offering
This Term Sheet ("Term Sheet") summarizes certain terms of the proposed
sale of Common Stock of US Xxxxxx.xxx, Inc. ("The Company") to WorldNet
Resource Group Inc. (' WNRG") and is for discussion purposes only. The Term
Sheet is not a complete description of this transaction, does not
constitute either an offer to sell or an offer to purchase securities, and
is qualified in its entirety by the definitive documents for this
transaction.
Company: US Xxxxxx.xxx, Inc. a Washington Corporation
Investor: WorldNet Resource Group, Inc. a Utah Corporation
Share Pricing & 20%
Pro Forma
Directors & Officers 4,380,131 41.0%
Capitalization: Other Shareholders 1,731,908 16.2%
Options Authorized 1,425,000 13.4%
Reserved for ISPs 1,000,000 9.4%
-----------
Existing: 8,537,039 80.0%
WNRG 2,134,260 20.0%
-----------
10,671,299 100.0%
-----------
WNRG Investments
Investments 2,134,260
Shares 2,134,260
Price per share $ 1.00
Benchmarks: Key Milestone 12/31/00 3/31/01
ISPs Operating US
Online Portal 100 200
Annualized Revenues,
based on Gross
Revenues in the
specified month
multiplied
By 12 ($000) $1,800 $3,600
Closing: US Online
----------
WNRG's% Shares
------- --------
Date: Action Shares Price Ownership Outstanding
-------- -------------- --------- ---------- ----------- -----------
10/20/00 Letter of Intent
signed
11/5/00 B/A/ $ 250,000 250,000 $1.00
12/15/00 $ 750,000 750,000 $1.00
2/1/2001 $1,134,260 1,134,260 $1.00
Total: $2,134,260 2,134,260 $1.00 20.0%
10,671,299
*NOTE: Stock share will be issued to WNRG at the proposed share price
upon the receipt of each payment.
Use of Proceeds: Next 12 Months
------------
Working Capital for $ 1,200,000
ISP Recruitment
Portal Operations
Local Ad Sales
Computer Equipment $ 350,000
Other Fixed Assets $ 227,000
Reserve $ 357,260
------------
Total: $ 2,134,260
Investor Eligibility: The offering is being made privately to
"accredited" investors within the meaning of Rule 501 of Regulation D under
the Securities Act of 1933. The criteria for determining accredited
investor status are set forth on the schedule of Investor Suitability
Standards attached to this Term Sheet.
Board Seat: WNRG shall have the right to elect one director of the
Company upon purchase of all shares shown above.
Consulting: WNRG shall provide key management personal to work with the
Company in achieving joint strategic initiatives.
Risk Factors: The purchasing of shares of capital stock in a small,
fragile company, such as the Company, is extremely speculative and, in view
of the myriad of risk to which the Company is inherently subject, should
not be made by anyone who cannot afford to lose his or her investment in
its entirety.
Transfer of Securities: There is and will be trading market in the
Company's securities. The Common Stock is not registered under federal or
state securities laws and may not be resold or transferred without the
furnishings of an opinion of counsel that to do so would not violate the
registration provisions of such laws. A legend upon the certificates
representing the Common Stock will so reflect such restrictions.
