Letter of Intent
Letter
of Intent
November
20, 2008
Goldvale
Resources, Inc.
000
Xxxxxxxxx Xxxxxx
Kenilworth,
New Jersey 07033
Gentlemen:
This Letter of Intent hereby sets forth
the mutual understanding with respect to the proposed share exchange transaction
between NXT Nutritonals, Inc., a Delaware corporation (“NXT”), and Goldvale Resources, Inc.,
a Delaware corporation (the "Company”). This Letter of Intent constitutes
a legally binding obligation or commitment of NXT and the Company with respect
to any matter provided for or contemplated herein (except as otherwise provided
herein).
The
proposed terms of the Share Exchange Agreement are as follows:
1. Definitive
Agreement. Promptly after the execution of this Letter of
Intent, NXT and the Company shall commence the negotiation and preparation of
definitive documentation (the "Definitive Agreement"), setting forth the
specific terms and conditions of the share exchange transaction (the
“Transaction”) proposed hereby. The parties shall use their reasonable best
efforts to negotiate in good faith the Definitive Agreement which will contain,
among other standard terms and conditions, the following
provisions:
a. Until the
closing of the Share Exchange Transactions (the “Closing”), the Company shall
maintain accurate and current filings with the Securities and Exchange
Commission. The Company shall maintain listing for its common stock
on the Over the Counter bulletin board.
b. Prior
to the Closing, NXT shall deliver to the Company financial statements including
a balance sheet, statement of operations, statement of cash flow and statement
of shareholders’ equity, prepared by an independent auditor in compliance with
U.S. GAAP (“Audited Financial Statements”). The independent auditor shall be
registered with the Public Company Accounting Oversight Board (PCAOB) and
performs audits of publicly-held companies in accordance with guidelines
established by the SEC and the PCAOB.
c. At the
Closing, the holders of all of the issued and outstanding common stock of
NXT (the “NXT Shares”) will transfer all the NXT Shares to the Company, whereby
NXT shall become a wholly owned subsidiary of the Company. In consideration for
the 100% equity ownership interest in NXT, the Company shall issue to the
holders of the NXT Shares a total of 21,830,000 post-split shares of the common
stock of the Company.
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d. The
Definitive Agreement shall contain customary representations, warranties and
indemnities made by the Company, NXT and the majority shareholders of
NXT.
2. Closing Date. The
Transaction shall be completed no later than the 31st day of
January 2009 (the “Closing Date”).
3. Conditions Precedent to the
Obligations of NXT. The obligations of NXT under this Letter of Intent
are subject to the satisfaction of the following conditions:
a. Prior to
the Closing Date, the Company will change its company name to NXT Nutritional
Holdings, Inc.
b. Prior
to the Closing Date, the Company will implement a 2-for-1 forward stock split of
all of its issued and outstanding shares of common stock.
4. Conduct
of Business.
Prior to the execution of the Definitive Agreement and the Closing of the
Transaction, the Company will conduct its operations in the ordinary course
consistent with past practice. The Company will not (a) issue any capital stock
or grant any options with respect to its capital stock; (b) make any
distributions, dividends or other payments to any affiliate or shareholders;
make any acquisition, by means of a merger or otherwise, of a material
amount of assets or securities, other than acquisitions in the ordinary course
consistent with past practice; (c) agree to any sale, lease, encumbrance or
other disposition of a material amount of assets or securities or any material
change in its capitalization, other than sales or other dispositions in the
ordinary course consistent with past practice; (d) enter into any material
contract other than in the ordinary course of business or agree to any release
or relinquishment of any material contract rights; (e) incur any long-term debt
or short-term debt for borrowed money except for debt incurred in the ordinary
course consistent with past practice; or (f) agree in writing or otherwise to
take any of the foregoing actions.
5. Conditions Precedent to
Closing. The Definitive Agreement shall provide that the
Transactions are expressly conditioned upon the following:
a. NXT shall
have delivered Audited Financial Statements, as described in Section
1(b).
b. The
Company shall have satisfied all of its periodic reporting requirements with the
Securities and Exchange Commission prior to the Closing, and the Company shall
deliver to NXT all necessary materials, financial and otherwise in order to
continue and maintain accurate records and filings with the Securities and
Exchange Commission. The Company will work with the SEC approved auditor
identified by NXT to coordinate the filing of a Form 8-K, the Company will
direct current financial representatives to prepare a copy of all current
financial records; and the Company will direct current financial
representatives to issue letter expressing satisfaction of all filings to be
included in a Form 8-K; and
c. All third
party and other consents required for the Transaction shall have been obtained;
and
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d. The
Transaction shall have been approved by all necessary entity action on the part
of NXT, the Company and any subsidiary in accordance with all applicable law;
and
e. No
action, suit or proceeding shall have been instituted or, to the knowledge of
the parties, be pending or threatened before any court or other governmental
body by any public agency or governmental authority seeking to restrain, enjoin
or prohibit the Transaction or to seek damages or other relief in connection
therewith against any member of management of either NXT or the Company;
and
f. No
action, suit or proceeding shall have been instituted or, to the knowledge of
the parties, be pending or threatened before any court or other governmental
body by any private party, public agency or governmental authority seeking to
restrain, enjoin or prohibit the Transaction or to seek damages or other relief
in connection therewith against any member of management of either NXT or the
Company. The Company shall indemnify NXT against potential litigation
arising from activities prior to the Transaction, and NXT shall indemnify the
Company against potential litigation arising from activities prior to the
Acquisitions; and
g. Expenses. Each
party shall be responsible for its own attorney fees and other costs and
expenses, anticipated or otherwise, relating to preparing the Definitive
Agreement.
6. Public
Announcements. Neither party will make any public disclosure
concerning the matters set forth in this Letter of Intent or the negotiation of
the proposed Transaction without the prior written consent of the other party,
which consent shall not be unreasonably withheld. If and when either
party desires to make such public disclosure, after receiving such prior written
consent, the disclosing party will give the other party an opportunity to review
and comment on any such disclosure in advance of public
release. Notwithstanding the above, to the extent that either party
is advised by counsel that disclosure of the matters set forth in this Letter of
Intent is required by applicable securities laws or to the extent that such
disclosure is ordered by a court of competent jurisdiction or is otherwise
required by law, then such disclosing party will provide the other party, if
reasonably possible under the circumstances, prior notice of such disclosure as
well as an opportunity to review and comment on such disclosure in advance of
the public release.
7. Due Diligence;
Confidentiality Agreement. Each party and its representatives,
officers, employees and advisors, including accountants and legal advisors, will
provide the other party and its representatives, officers, employees and
advisors, including accountants and legal advisors, with all information, books,
records and property (collectively, “Transaction Information”) that such other
party reasonably considers necessary or appropriate in connection with its due
diligence inquiry. Each party agrees to make available to the other
party such officers, employees, consultants, advisors and others as reasonably
requested by the other party for meetings, visits, questions and discussions
concerning each other and the Transaction. Each of the parties will
use its reasonable best efforts to maintain the confidentiality of the
Transaction Information, unless all or part of the Transaction Information is
required to be disclosed by applicable securities laws or to the extent that
such disclosure is ordered by a court of competent jurisdiction. Each
party will have until 12:00PM Eastern standard time on November 30, 2008 (the
“Due Diligence Review Period”) to complete their initial due diligence review of
the respective documents, unless the Definitive Agreement specifies a different
deadline for completion of such due diligence review.
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8. Expenses. Each
of the parties will be responsible for its own expenses in connection with the
Transaction, including fees and expenses of legal, accounting and financial
advisors.
9. Governing
Law. This Letter of Intent and the Definitive Document shall
be governed by and Interpreted in accordance with the laws of the State of
Delaware.
10. Compliance with the
Securities Laws. NXT acknowledges that it and its officers,
directors, shareholders and employees and other representatives may, in
connection with their consideration of the proposed Transaction, come into
possession of material non-public information about the Company. Accordingly,
NXT will use its best efforts to ensure that none of its officers, directors,
shareholders and employees or other representatives will trade (or cause or
encourage any third party to trade) in any of the securities which they will
receive as a result of the Transaction while in possession of any such material,
non-public information. The Company acknowledges that it and its officers,
directors, shareholders and employees and other representatives may, in
connection with their consideration of the proposed Transaction, come into
possession of material non-public information about NXT and their respective
affiliates. Accordingly, the Company will use its best efforts to
ensure that none of its officers, directors, shareholders and employees or other
representatives will trade (or cause or encourage any third party to trade) in
any of the securities which they will receive as a result of the Transaction
while in possession of any such material, non-public information.
11. Counterparts. This
letter of intent maybe executed in counterparts, each of which shall be deemed
an original, but all of which together shall constitute one and the same
instrument. Fax copies of signatures shall be treated as originals
for all purposes.
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If this
letter accurately reflects our agreements and understandings with respect to the
proposed Transaction, please confirm this by signing and returning the enclosed
counterpart copy of this letter to the undersigned.
Very
truly yours,
|
NXT
Nutritionals, Inc.
/s/ Xxxx
XxXxxxxx
Name: Xxxx
XxXxxxxx
Title:
CEO
|
Goldvale
Resources, Inc.
/s/ Xxxxx
Xxxxx
Name:
Xxxxx Xxxxx
Title:
President, CEO
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