Xxxxxxxx Laboratories, Inc.
0000 Xxxxxxxx Xxx., Xxxxx 000 Tel: (000) 000-0000
Xxxxxxx, Xxxxx 00000 Fax: (000) 000-0000
July 19, 2000
SECURITIES PURCHASE AGREEMENT
Benchmark Merchant Partners, L.P.
Attn: Xxxxx XxXxxx
000 Xxxxxx
Xxxxxxx, Xxxxx 00000
Tel: 000-000-0000
Fax: 000-000-0000
E-mail: xxxxx@xxxx.xxx
RE: Securities Purchase Agreement among and between Xxxxxxxx
Laboratories, Inc., a Utah corporation ("Xxxxxxxx"or "BTRM"), and
Benchmark Merchant Partners, L.P.
Dear Xxxxx:
Further to the above referenced subject, this Agreement will confirm
the following terms and conditions upon which Xxxxxxxx will sell and Benchmark
Merchant Partners, L.P. ("Benchmark") will acquire 17,000,000 pre-split
restricted common stock shares of Xxxxxxxx (the "Securities Purchase
Agreement").
Xxxxxxxx and Benchmark have agreed to the following:
1. Xxxxxxxx will issue 12,500,000 pre-split restricted common stock shares for
a price of $.001 per share or $12,500 to individuals designated by
Xxxxxxxx'x current Board of Directors (the "Consultant Group").
2. Simultaneous with the purchase and issuance of the 12,500,000 shares to the
Consultant Group, Benchmark shall acquire and be issued 17,000,000 pre-
split restricted common stock shares of Xxxxxxxx for a price of $.0176 per
share or $300,000 USD on or before July 19, 2000 (the "Stock Purchase").
$200,000 USD in good funds payable upon execution of this Agreement; and a
promissory note in the amount of $100,000 USD made by Benchmark due and
payable to Xxxxxxxx upon execution of the Agreement and Plan of
Reorganization among and between Xxxxxxxx and a wireless telecommunication
network company serving the developing foreign markets with strong growth
potential and limited competition with annual revenues of no less than
$50,000,000 USD, earnings before interest, taxes, depreciation and
amortization ("EBITDA") of no less than $12,500,000 USD, and shareholders
equity of no less than $10,000,000 USD (the "Suitable Reorganization
Candidate"), or the close of business on December 31, 2000, whichever
occurs first (the "Closing"), shall be deposited by Benchmark with the
trust account of Xxxxxxx Xxxxxxxxxx, Esq., prior to or simultaneous with
the execution of the Stock Purchase Agreement to Purchaser, the 17,000,000
restricted common stock shares, which so as shall be paid by Xxxxxxx
Xxxxxxxxxx, Esq., Trustee, to the designees of Xxxxxxxx solely as directed
by Xxxxxxxx'x current Board of Directors upon execution of the Securities
Purchase Agreement. The funds shall pay: costs accrued in the
reinstatement and maintenance of the Xxxxxxxx corpus; any and all
outstanding obligations of Xxxxxxxx pre-Plan, legal, accounting and other
professional fees incurred by Xxxxxxxx pursuant to the Plan up to the
Closing. It is understood by the parties hereto, that Xxxxxxx Xxxxxxxxxx,
Esq. shall have NO liability by reason of acting as Escrow Agent, except to
act in good faith and pursuant to the instruction of the current Board of
Directors of Xxxxxxxx.
(a) Promissory Note. Benchmark promises to pay to the order of
Xxxxxxxx, the sum of ONE-HUNDRED-THOUSAND U.S. Dollars($100,000.00
USD), together with interest of six percent (6%) per
annum on the unpaid balance (the "Promissory Note"). The
Promissory Note is described as follows:
(i) Payment in full of the principal and accrued interest to
Xxxxxxxx upon closing of the Agreement and Plan of
Reorganization, among and between the Suitable Reorganization
Candidate and Xxxxxxxx (the "Closing"), or close of business at
5:00 p.m. Central Standard Time on December 31, 2000, whichever
occurs sooner.
(ii) Benchmark will deposit and pledge with Xxxxxxx Xxxxxxxxxx,
Esquire, Trustee for Xxxxxxxx ("Pledgee") as collateral security
to secure the payment of: U.S. Dollars $100,000.00 Promissory Note
made payable to Xxxxxxxx by Benchmark , due upon closing of the
Agreement and Plan of Reorganization among and between the
Suitable Reorganization Candidate and Xxxxxxxx, or close of the
business on December 31, 2000, whichever occurs first, 17,000,000
pre-split restricted common stock shares of Xxxxxxxx (the "Pledge
of Shares"). The Promissory Note and the accompanying Pledge of
Shares will be assigned as directed by Xxxxxxxx'x current Board of
Directors upon closing of the Securities Purchase Agreement.
(iii) The Promissory Note shall be assigned with attachment
collateral solely in accordance with the instructions of the
current members of the Board of Directors of Xxxxxxxx.
(iv) The Promissory Note obligation can be assumed with the mutual
consent of Benchmark and the current members of the Board of the
Directors of Xxxxxxxx. Such consent shall not be unreasonably
withheld.
(v) In the event the Closing does not occur on or before December
31, 2000, Benchmark has the option to authorize and direct Xxxxxxx
Xxxxxxxxxx, Trustee, to return the 17,000,000 pre-split restricted
Xxxxxxxx common stock shares held in Escrow, pursuant to the
Pledge of Shares agreement, to the current members of the Board of
Directors of Xxxxxxxx, which in turn shall effect the return of
the shares to treasury or caused the cancellation of the shares in
return for/and the consideration of the forgiveness and
cancellation of the $100,000 Promissory Note and the payment by
Xxxxxxxx to Benchmark of an additional $75,000 USD. The
cancellation and return of the Promissory Note and the $75,000
payment by Xxxxxxxx shall be considered as liquidated damages.
The $125,000 that Benchmark leaves with Xxxxxxxx in turn will be
treated as liquidated damages and both parties hereto agree to
waive all causes of action against the other and hold the other
harmless.
3. Demand Registration Rights. In connection with the transactions by and
between Xxxxxxxx and Benchmark, Xxxxxxxx has agreed to grant certain
registration rights to the holders of the shares to be issued pursuant to
paragraphs 1 and 2 above and the holders of any shares issued while
Xxxxxxxx may be deemed to be a shell. Xxxxxxxx agrees to provide those
holders with Demand Registration Rights whereby, all shares; the 17,000,000
pre-split restricted common stock to be issued to Benchmark, its heirs,
assigns or designees, and 12,500,000 pre-split restricted common stock
shares to be issued to the Consultant Group, and all shares that may be
deemed shares issued while Xxxxxxxx was a shell, shall be filed for
registration with the Securities and Exchange Commission on the appropriate
form within 45 days of the close of the Reorganization. Xxxxxxxx
anticipates it will take 45 days to prepare and file the registration
statement once the Reorganization has been closed and up to 150 days for
the statement to become effective once the registration statement is filed.
Xxxxxxxx agrees to pay all costs of registration and to pay a late penalty
of $1,000 per day ($500 to Benchmark and $500 to Xxxxxxx Xxxxxxxxxx,
Trustee for the Consultant Group) for every day the registration process
runs over the 150-day target.
4. Following the pre-split issuance of shares to the Consultant Group and
Benchmark and/or its designees, Xxxxxxxx shall have 33,000,000 pre-split
common stock shares issued and outstanding.
5. Xxxxxxxx would effect a 1 for 10 reverse split of its issued and
outstanding common stock shares on or about August 14, 2000, resulting in
3,300,000 post-split shares issued and outstanding (the "Reverse Split") in
accordance with the laws of the state of its organization.
6. BTRM would re-domicile from Utah to British Virgin Islands as soon as
reasonably practicable. Benchmark will pay all costs not to exceed $40,000
to re-domicile BTRM from Utah to British Virgin Islands. The anticipated
cost of the re-domiciling is in addition to the $300,000 paid Xxxxxxxx by
Benchmark for the 17,000,000 pre-split restricted common stock shares.
7. The Suitable Reorganization Candidate with the assistance of Benchmark,
shall effect the placement of not less than $10,000,000 in equity financing
for the Suitable Reorganization Candidate on or before December 31, 2000
(the "Equity Financing") or Xxxxxxxx has the option not to enter into the
contemplated Agreement and Plan of Reorganization among and between
Xxxxxxxx and the Suitable Reorganization Candidate. The precise terms and
conditions of the Equity Financing are expected to vary over time in
accordance with market conditions. Consequently, the class and numbers of
shares are all to be negotiated and determined in light of the market
conditions existing at the time the Equity Financing is negotiated and
secured, provided, however all such terms and conditions are subject to the
Suitable Reorganization Candidate's acceptance and approval.
8. The Suitable Reorganization Candidate shall exchange up to 25,000,000 post-
split shares of BTRM to effect the Reorganization.
9. To Summarize the Reorganization:
(Post-reverse-split, post-Equity Financing, Post-plan)
SHARES %
Xxxxxxxx-Original Shareholders . . . . . .350,000 1.051
Xxxxxxxx-Consultants 1,250,000 3.754
Benchmark 1,700,000 5.105
Suitable Reorganization Candidate 25,000,000 75.075
Equity Financing (up to $25 mil.)* . . .5,000,000 15.015
Total. . . . . . . . . . . . . . . . . 33,300,000 100.00 %
* The precise terms and conditions of the Equity Financing are
expected to vary over time in accordance with market conditions.
Consequently, the class and numbers of shares are all to be
negotiated and determined in light of the market conditions existing
at the time the Equity Financing is negotiated and secured.
10.If the Suitable Reorganization Candidate has not entered into an Agreement
and Plan of Reorganization with BTRM on or before December 31, 2000, BTRM's
current directors will have the right ("Call Option") to repurchase
Benchmark's pre-split 17,000,000 restricted common stock shares which
constitutes ownership of 51.52% of Xxxxxxxx prior to the contemplated
Reorganization for $75,000 and forgiveness of Benchmark's $100,000
Promissory Note, or in the alternative, Benchmark can present an
alternative candidate for reorganization for BTRM's current Board of
Directors review and approval. Approval of an alternative reorganization
candidate shall not unreasonably be withheld.
(a) In the event an alternate reorganization candidate is
approved by Xxxxxxxx'x current board of directors, the $100,000
note from Benchmark to Xxxxxxxx will be due and payable at the
closing of the Agreement and Plan of Reorganization for the
alternate reorganization candidate on December 31, 2000 or
whichever comes first.
11. Other.
(a) The parties hereto agree that Xxxxxxxx shall not issue any
securities other than those provided for herein without the expressed
written consent of the current Board of Directors of Xxxxxxxx and the
Benchmark
(b) Any notice required or permitted hereunder shall be given in
writing (unless otherwise specified herein) and shall be effective
upon personal delivery, via facsimile (upon receipt of confirmation of
error-free transmission and mailing a copy of such confirmation
postage prepaid by certified mail, return receipt requested) or two
business days following deposit of such notice with an internationally
recognized courier service, with postage prepaid and addressed to each
of the other parties thereunto entitled at the following addresses, or
at such other addresses as a party may designate by 10 days advance
written notice to each of the other parties hereto:
Xxxxxxxx Laboratories, Inc.
0000 Xxxxxxxx Xxx., Xxxxx 000
Xxxxxxx, Xxxxx 00000
Tel: (000) 000-0000
Fax: (000) 000-0000
With a copy to:
Xxxxxxx X. Xxxxxxxxxx, Esq.
Attorney at Law
000 Xxxx 000 Xxxxx, Xxxxx 000
Xxxx Xxxx Xxxx, Xxxx 00000
Tel: (000) 000-0000
Fax: (000) 000-0000
and to:
Benchmark Merchant Partners, L.P.
Attn: Xxxxx Xxxxxx
000 Xxxxxx
Xxxxxxx, Xxxxx 00000
Tel: (000) 000-0000
Fax: (000-000-0000
(c) Failure of any party to exercise any right or remedy under this
Agreement or otherwise, or delay by a party in exercising such right
or remedy, shall not operate as a waiver thereof.
(d) This Agreement shall be governed by and interpreted in accordance
with the laws of the State of Utah. Each of the parties consents to
the jurisdiction of the federal courts whose districts encompass any
part of the County of Utah or the state courts of the State of Utah
sitting in the County of Utah in connection with any dispute arising
under this Agreement and hereby waives, to the maximum extent
permitted by law, any objection, including any objection based on
forum non-conveniens, to the bringing of any such proceeding in such
jurisdictions. This Agreement may be signed in one or more
counterparts, each of which shall be deemed an original.
(e)This Agreement constitutes the entire agreement among the parties
hereto with respect to the subject matter hereof. This Agreement
supercedes all prior agreements and understandings among the parties
hereto with respect to the subject matter hereof.
# # # #
IN WITNESS WHEREOF, this Agreement has been duly executed by the
undersigned this the 19th day of July, 2000.
Sincerely,
"Xxxxxxxx" or "BTRM"
Xxxxxxxx Laboratories, Inc.
By:/s/ W. A. Xxxxxx, Jr., President
IN WITNESS WHEREOF, this Agreement has been duly executed by the
undersigned this the 19th day of July, 2000.
Sincerely,
"Benchmark"
Benchmark Merchant Partners, L.P.
By:/s/Xxxxx Xxxxxx
