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EXHIBIT 10.7
PROFIT PARTICIPATION CANCELLATION AGREEMENT
This PROFIT PARTICIPATION CANCELLATION AGREEMENT ("Agreement") is made
and entered as January 31, 1996, by and between Myriad International, Inc., a
Delaware corporation ("Myriad") 0000 Xx Xxxxx Xxxxxxx Xxxxx, Xxxxx 000, Xxx
Xxxxx, XX 00000 and Xxxxxxx Xxxxxxxxx, 0000 Xxx Xxxxxx, Xxx Xxxxx, XX 00000
("Xxxxxxxxx").
RECITALS
A. Myriad and Xxxxxxxxx are party to a Memorandum of Understanding
dated June 28, 1995 ("June 28, 995 MOU") pursuant to which Xxxxxxxxx provided a
$250,000 short term loan to Myriad and received as incentive a 5% net profit
participation in a joint venture being established between Myriad and La Societe
de Developpement Des Iles for the building and operation of a fleet of long line
fishing vessels in Tahiti ("Long Line Venture").
B. Myriad and Xxxxxxxxx are party to a Memorandum of Understanding
dated August 2, 1995 ("August 2, 1995 MOU") pursuant to which Xxxxxxxxx provided
a $60,000 short term loan to Myriad and received as incentive an additional 15%
net profit participation in the Long Line Venture.
C. Myriad and Xxxxxxxxx are party to a Memorandum of Understanding
dated September 27, 1995 ("September 27, 1995 MOU") pursuant to which Xxxxxxxxx
provided a $20,000 short term loan to Myriad and received as incentive a 1% net
profit participation in a venture being established by Myriad for the
construction of pre-fabricated housing in South Africa ("South Africa Venture").
D. Myriad and Xxxxxxxxx are party to a Memorandum of Understanding
dated November 6, 1995 ("November 6, 1995 MOU") pursuant to which Xxxxxxxxx
provided a $30,000 short term loan to Myriad and received as incentive a 5% net
profit participation in Myriad Capital Corporation - Peru ("Myriad Capital
Venture")
E. Myriad and Xxxxxxxxx are party to a Memorandum of Understanding
dated November 8, 1995 ("First November 8, 1995 MOU") pursuant to which
Xxxxxxxxx provided a $16,500 short term loan to Myriad and received as incentive
a 2.5% net profit participation in the South Africa Venture and a venture to
construct pre-fabricated housing in Venezuela ("Venezuela Venture").
F. Myriad and Xxxxxxxxx are party to a Memorandum of Understanding
dated November 8, 1995 (" Second November 8, 1995 MOU ") pursuant to which
Xxxxxxxxx
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provided a $3,500 short term loan to Myriad and received as incentive an
additional 0.5% net profit participation in the South Africa Venture and the
Venezuela Venture.
G. Myriad and Xxxxxxxxx are party to a Memorandum of Understanding
dated November 29, 1995 ("November 29, 1995 MOU ") pursuant to which Xxxxxxxxx
provided a $3,000 short term loan to Myriad and received as incentive an
additional 0.5% net profit participation in the South Africa Venture and the
Venezuela Venture.
H. Myriad and Xxxxxxxxx are party to a Memorandum of Understanding
dated December 6, 1995 ("December 6,, 1995 MOU ") pursuant to which Xxxxxxxxx
agreed to an extension of a $30,000 short term loan to Myriad and received as
incentive an additional 2.5% net profit participation in the Venezuela Venture
and a 2% net profit participation in Myriad Industries Inc. - Peru S.A. ("Myriad
Peru Venture").
I. Myriad and Xxxxxxxxx are party to a Memorandum of Understanding
dated December 12, 1995 ("December 12, 1995 MOU ") pursuant to which Xxxxxxxxx
agreed to an extension of a $30,000 short term loan to Myriad and received as
incentive an additional 4.5% net profit participation in the Venezuela Venture.
J. Myriad and Xxxxxxxxx are party to a Memorandum of Understanding
dated December 22, 1995 ("December 22, 1995 MOU ") pursuant to which Xxxxxxxxx
agreed to an extension of a $17,500 short term loan to Myriad and received as
incentive an additional 3% net profit participation in the South Africa Venture.
K. Myriad and Xxxxxxxxx are party to a Memorandum of Understanding
dated December 27, 1995 ("December 27, 1995 MOU ") pursuant to which Xxxxxxxxx
agreed to an extension of a $17,500 short term loan to Myriad and received as
incentive an additional 2.5% net profit participation in the Venezuela Venture.
L. As a result of the agreements between Myriad and Xxxxxxxxx set forth
in recitals A to K above Xxxxxxxxx has the following profit participations:
Long Line Venture 20.0 %
Venezuela Venture 12.5
South Africa Venture 7.5
Myriad Capital Venture 5.0
Myriad Peru Venture 2.0
X. Xxxxxxxxx presently is the beneficial owner (directly and
indirectly) of 3,241,189 shares of the issued and outstanding Class A Common
Stock (approximatel;y 21%) and holds warrants to purchase an additional
2,156,941 shares of Class A Common Stock.
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N. Myriad and Xxxxxxxxx have agreed that it is in their mutual best
interests for Xxxxxxxxx to exchange his profit participations in the Long Line,
Venezuela, South Africa, Myriad Capital and Myriad Peru Ventures for warrants to
purchase 1,500,000 shares of Myriad Class A Common Stock; 500,000 exercisable at
$1.00 per share, 500,000 exercisable at $1.50 per share and 500,000 exercisable
at $2.00 per share.
AGREEMENT
In consideration of the terms, conditions, releases, warranties, and
covenants contained herein, Myriad and Xxxxxxxxx agree as follows:
1. Recitals and Exhibits . Recitals A through N are incorporated herein
by this reference and made a part hereof. All Exhibits referenced in this
Agreement shall be attached to the Agreement and shall be deemed incorporated
herein.
2. Issuance and Delivery of Class A Stock Purchase Warrants.
2.1 Myriad shall deliver to Xxxxxxxxx on or before February
15, 1996 stock purchase warrants for the purchase of 500,000 shares of Myriad
Class A common stock for $1.00 per share in the form attached as Exhibit 2.1.
2.2. Myriad shall deliver to Xxxxxxxxx on or before February
15, 1996 stock purchase warrants for the purchase of 500,000 shares of Myriad
Class A common stock for $1.50 per share in the form attached as Exhibit 2.2.
2.3. Myriad shall deliver to Xxxxxxxxx on or before February
15, 1996 stock purchase warrants for the purchase of 500,000 shares of Myriad
Class A common stock for $200 per share in the form attached as Exhibit 2.3.
3. Cancellation of Profit Participations
3.1. Upon receipt of the stock purchase warrants referred to
in sub-sections 2.1, 2.2 and 2.3 above by Xxxxxxxxx the profit participations in
the Long Line Venture, Venezuela Venture, South Africa Venture, Myriad Capital
Venture and Myriad Peru Venture shall be cancelled and shall be of no further
force and effect.
4. Entire Agreement . This Agreement contains all of the promises which
have been made in connection with the transactions contemplated hereby. There
are no unstated or hidden terms, and every term which is important to this
Agreement is specified in writing. This Agreement contains the entire
understanding of the Parties of the terms upon which they have agreed to enter
into this Agreement, and any prior contemporaneous oral representations shall be
of no force and effect.
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5. Headings. All topic headings in this Agreement have been used for
organizational purposes only and have no independent legal significance or
import.
6. Unenforceable Terms. The Parties agree that if any provision of
this Agreement is held by a court of competent jurisdiction to be invalid, void,
or unenforceable, the remaining provisions shall nevertheless continue in full
force without being impaired or invalidated in any way.
7. Further Assurances. Each of the parties hereby agrees to at any
time and from time to time, upon the request of any party hereto, to execute and
deliver such further documents and do such other acts as reasonably requested in
order to effect fully the purposes of this Agreement.
8. Arbitration. Any dispute concerning this Agreement shall be settled
by binding arbitration in accordance with the rules of the American Arbitration
Association in San Diego County, California.
9. Action on Agreement. If any Party brings an action to enforce this
Agreement or any provision thereof, the prevailing party shall be entitled to
recover its attorneys' fees and costs from the losing party.
Dated as of the date first written above.
Myriad International, Inc.
By /s/ Xxxxxx X. Xxxxxxxx
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Xxxxxx X. Xxxxxxxx, Chairman
/s/ Xxxxxxx Xxxxxxxxx
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Xxxxxxx Xxxxxxxxx
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