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AGREEMENT setting forth the terms and conditions upon which TPG CAPITAL
CORPORATION ("TPG") is engaged by AQUA VIE BEVERAGE CORPORATION together with
any successors (collectively "Aqua Vie") to effect transactions ("the
Transactions") intended to merge or otherwise combine Aqua Vie with a United
States reporting company and for related matters.
SERVICES PROVIDED.
Following its engagement, TPG and its affiliates will:
Advise Aqua Vie on the structure of the Transactions and actions to be
taken by Aqua Vie in preparation for the completion of the Transactions;
Merge Aqua Vie or exchange its stock with or assist in transferring
its assets into an existing United States corporation ("the Business
Combination") which is or will become a reporting company under Section 12(g) of
the Securities Exchange Act of 1934, as amended.
Prepare, assist in preparing or review the agreement for the Business
Combination ("Business Combination Agreement");
Prepare and file with the Securities and Exchange Commission a Form 10
or Form 8-K describing the Business Combination with the Company ("the Company"
hereinafter shall mean the United States corporation following the Business
Combination, unless the context requires otherwise);
Take any other actions reasonably required of it to complete the
Transactions as contemplated by this agreement.
BUSINESS COMBINATION.
TPG will provide, at its expense, a United States corporation with
audited financial statements showing no material assets or liabilities which is
or which TPG will cause to become a reporting company under Section 12(g) of the
Securities Exchange Act of 1934 ("xxx 0000 Xxx").
Aqua Vie, at its election, will merge into, exchange its stock with,
or transfer its assets to the United States corporation. Upon the effective date
of the Business Combination, the officers and directors selected by Aqua Vie
will become the officers and directors of the United States corporation. The
name of the United States corporation following the Business Combination will be
chosen by Aqua Vie.
The United States corporation will have authorized capital of
100,000,000 shares of common stock, $.0001 par value per share, and 20,000,000
shares of preferred stock, $.0001 par value per share.
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Upon the effective date of the Business Combination, there will be
issued and outstanding by the Company (i) 250,000 common shares issued to TPG
(ii) a common stock purchase warrant (described below) granted to TPG and (iii)
such common stock and other securities as designated by Aqua Vie in the Business
Combination Agreement.
PAYMENTS.
Aqua Vie will pay TPG $100,000 for its services and the services of its
affiliates in regard to the Transactions. Payment of this amount will be made
$25,000 on execution of this agreement, $50,000 on the Business Combination and
$25,000 on the filing of a Form 10 or Form 8-K with the Securities and Exchange
Commission.
In the event that Aqua Vie is a foreign corporation, or for other
reasons TPG deems sufficient, TPG may request Aqua Vie, and Aqua Vie agrees, to
deposit an amount equal to the remaining payments to be made after execution of
this agreement in escrow under an escrow agreement satisfactory to both parties.
Aqua Vie hereby grants TPG a 5-year transferrable warrant ("TPG
Warrant") to acquire up to 250,000 registered shares of the Company's common
stock at a strike price of $1.00 per share. The Company will execute and deliver
to TPG a form of common stock purchase warrant agreement, warrant and warrant
exercise subscription not inconsistent with the terms provided herein.
Aqua Vie will not at any time take or allow any action (whether by
reverse stock split or otherwise) which would have the effect of reducing the
absolute number of common shares owned or to be owned by TPG or its designee
under this agreement.
EXPENSES.
TPG will bear its expenses incurred in regard to the Transactions,
including, without limitation, travel, telephone, duplication costs, and
postage.
Aqua Vie will pay its own and third-party expenses (other than those of
TPG) including, without limitation, Federal, state and Nasdaq filing fees,
underwriting and market making costs, corporate financial relations, accounting
fees, duplicating costs and other expenses of the Company.
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AGREEMENT TO COMPLETE TRANSACTIONS.
Aqua Vie agrees that it will timely take all steps necessary to complete
the Transactions to include, without limitation, causing audited financial
statements to be prepared in proper form for Aqua Vie; obtaining consents of the
Board of Directors and the shareholders of Aqua Vie, as required; causing all
necessary documents to be properly and timely prepared, executed, approved or
ratified, and filed, as appropriate; making timely and fully all required
payments related to the registration and listing of the Company's securities for
public trading, including filing fees; and timely taking all other actions
reasonably required of it to complete the Transactions.
In the event that at any time Aqua Vie determines not to continue with the
Transactions TPG hereby grants to Aqua Vie the right to buyout the interest of
TPG in this agreement on the terms contained herein, in which case TPG agrees
not to seek specific enforcement of this agreement. In the event that Aqua Vie
elects not to continue with the Transactions (or if Aqua Vie does not timely
take all such steps and do all things as may be reasonably required of it to
complete the Transactions) TPG will be entitled to (i) retain the securities in
Aqua Vie acquired or to be acquired by TPG or its affiliates under this
agreement as though the Business Combination had occurred and (ii) receive in
full all payments to be due to it or its affiliates through and upon completion
of the Transactions as though those events had occurred provided, however, that
Aqua Vie will not be obligated to make any payment under this paragraph if the
failure to complete the Transactions is due to any actions or failure to act by
TPG or its affiliates. Upon payment of the buyout fee provided for herein, all
obligations of the parties under this agreement will cease except for
obligations which expressly or by their nature survive termination.
PERFORMANCE OF SERVICES BY OTHERS.
From time to time, the achievement of certain results desired by the
Company, including the promotion of interest in its public securities, may be
enhanced by the services of other parties. These parties may include
consultants, advertising agencies, financial analysts and similar persons who
may, directly or indirectly, assist in creating interest in the Company's
securities. All compensation, costs and expenses of such parties, if engaged by
the Company, will be borne by it.
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ACTIONS AND UNDERSTANDINGS FOLLOWING THE BUSINESS COMBINATION.
Aqua Vie understands the obligations and responsibilities that will arise
in regard to its becoming a reporting company and the trading of its securities
in the public market. Aqua Vie understands that in order to achieve the greatest
market interest in its securities it, its officers and its directors, all or
some, will be required to continuously interact with the financial community.
This interaction will include, without limitation, timely filing of reports
under the Securities Exchange Act of 1934, including audited financial
statements; annual reports to shareholders and shareholder meetings; issuing
periodic press releases; and meetings and discussions with existing and
prospective brokers, market makers, investment bankers and institutions.
Aqua Vie understands that the completion of the Transactions will not, in
itself, result in capital investment in the Company. The public status of the
Company and its introduction to market makers and others in the financial
community may result in investment interest. However, investment interest will
depend upon the successes of the Company, market conditions and other factors
over which neither TPG nor its affiliates have control.
Aqua Vie understands that the ultimate judgement of the financial community
of the investment merits of the Company will depend upon the Company's ability
to successfully carry out its business plans and operations, to operate at a
profit and similar business considerations. Aqua Vie represents in good faith
that it currently has no reason to believe that it will not be able to complete
the Transactions and to achieve its business objections.
During the Transactions and so long as TPG or an affiliate is a shareholder
of the Company, it will provide TPG continuing and reasonable access as
requested to all information concerning the Company's operations, past, current
and intended, including, without limitation, full access to the financial
records of the Company.
COMPLIANCE WITH SECURITIES LAW.
Now and following the Business Combination, as applicable, Aqua Vie
represents and warrants that:
Aqua Vie and its affiliates will at all times observe and comply with
Federal and State securities laws, rules and regulations incident to the
issuance and trading of the securities of the Company and will take all steps
reasonably required within its control to prohibit any persons, whether or not
affiliated with Aqua Vie, from engaging in any transactions in contravention of
such laws, rules and regulations.
Aqua Vie and its affiliates will furnish all information and documents
concerning it and its affiliates required for the preparation and filing of a
Form 8-K or Form 10-SB by the Company and will assure that such information is
complete and accurate and does not contain
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any material misstatement or omit any material information. Toward that end,
Aqua Vie and its affiliates will timely provide all requested information and
documents, including officers' and directors' questionnaires.
Aqua Vie and its affiliates will not at any time knowingly engage in any
activity which would constitute a prohibited market manipulation of the
securities of the Company and will take all steps reasonably required within
its control to prohibit any officer, director, other affiliate, agent or
employee from engaging in such conduct.
The Company will not at any time issue securities registered on Form S-8
or issued pursuant to Regulation S of the General Rules and Regulations of the
Securities and Exchange Commission without (i) prior written notification to
TPG and (ii) either the written content of TPG or a written opinion of qualified
counsel that neither the issuance nor intended use of such securities will
violate any law, rule, or regulation under the Securities Act of 1933 or the
Securities Exchange Act of 1934.
The Company will not issue any securities to any person for the
promotion or maintenance of a trading market in the Company's securities without
first receiving an opinion of qualified counsel that such issuance will be in
accord with securities laws, rules and regulations and will not, directly or
indirectly, receive from such persons any capital by loan, investment or
otherwise resulting from the sale or pledge of such securities.
For not less than 36 months following the execution of this agreement,
the Company will timely make all required Federal, state and other filings
necessary to allow the public trading of the Company's securities and, if the
Company's securities are then quoted on the Nasdaq Stock Market or listed on
any regional or national exchange, will take all actions necessary to maintain
such status for the Company's securities.
For so long as TPG or its designee in an owner of any of the securities
to be received by it under this agreement, TPG shall have the right to enforce
the provisions of this paragraph and to seek damages for any violation thereof
by the Company, including damages for any reduced value of the TPG securities
if resulting from such violation.
NOTICES.
Any notices required or permitted under this agreement shall be deemed
to have been given when delivered in writing by hand, certified mail (return
receipt requested) or commercial courier, such as FedEx, to the following
addresses or to such other addresses as may have been given to each party in
the manner provided for in this paragraph.
In the case of Aqua Vie or the Company to
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Aqua Vie Beverage Corporation
000 Xxxxx Xxxx Xxxxxx
Xxxxxxx, Xxxxx 00000
In the case of TPG to
TPG Capital Corporation
0000 X Xxxxxx X.X.
Xxxxxxxxxx, X.X. 00000
ARBITRATION.
SCOPE. The parties hereby agree that any and all claims (except only for
requests for injunctive or other equitable relief) whether existing now, in the
past or in the future as to which the parties or any affiliates may be adverse
parties, and whether arising out of this agreement or from any other cause, will
be resolved by arbitration before the American Arbitration Association within
the District of Columbia.
CONSENT TO JURISDICTION, SITUS AND JUDGEMENT. The parties hereby
irrevocably consent to the jurisdiction of the American Arbitration Association
and the situs of the arbitration within the District of Columbia. Any award in
arbitration may be entered in any domestic or foreign court having jurisdiction
over the enforcement of such awards.
APPLICABLE LAW. The law applicable to the arbitration and this agreement
shall be that of the District of Columbia, determined without regard to its
provisions which would otherwise apply to a question of conflict of laws.
DISCLOSURE AND DISCOVERY. The arbitrator may, in its discretion, allow
the parties to make reasonable disclosure and discovery in regard to any matters
which are the subject of the arbitration and to compel compliance with such
disclosure and discovery order. The arbitrator may order the parties to comply
with all or any of the disclosure and discovery provisions of the Federal Rules
of Civil Procedure, as they then exist, as may be modified by the arbitrator
consistent with the desire to simplify the conduct and minimize the expense of
the arbitration.
RULES OF LAW. Regardless of any practices of arbitration to the
contrary, the arbitrator will apply the rules of contract and other law of the
jurisdiction whose law applies to the arbitration so that the decision of the
arbitrator will be, as much as possible, the same as if the dispute had been
determined by a court of competent jurisdiction.
FINALITY AND FEES. Any reward or decision by the American Arbitration
Association shall be final, binding and non-appealable except as to errors of
law or the failure of the arbitrator to adhere to the arbitration provisions
contained in this agreement. Each party to the
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arbitration shall pay its own costs and counsel fees except as specifically
provided otherwise in this agreement.
MEASURE OF DAMAGES. In any adverse action, the parties shall restrict
themselves to claims for compensatory damages and/or securities issued or to be
issued and no claims shall be made by any party or affiliate for lost profits,
punitive or multiple damages.
COVENANT NOT TO XXX. The parties covenant that under no conditions will any
party or any affiliate file any action against the other (except only requests
for injunctive or other equitable relief) in any forum other than before the
American Arbitration Association, and the parties agree that any such action, if
filed, shall be dismissed upon application and shall be referred for arbitration
hereunder with costs and attorney's fees to the prevailing party.
INTENTION. It is the intention of the parties and their affiliates that all
disputes of any nature between them, whenever arising, whether in regard to this
agreement or any other matter, from whatever cause, based on whatever law, rule
or regulation, whether statutory or common law, and however characterized, be
decided by arbitration as provided herein and that no party or affiliate be
required to litigate in any other forum any disputes or other matters except for
requests for injunctive or equitable relief. This agreement shall be interpreted
in conformance with this stated intent of the parties and their affiliates.
SURVIVAL. The provision for arbitration contained herein shall survive the
termination of this agreement for any reason.
ASSIGNMENT.
In order to better carry out the Transactions, TPG may assign all or parts
of this agreement provided that the assignee agrees to all the terms and
conditions of this agreement pertaining to such assignment. An assignment will
not relieve TPG of any of its obligations under this agreement.
CONFIDENTIALITY.
As a result of entering into this agreement Aqua Vie will have access to
information which TPG regards as confidential and proprietary regarding TPG's
methods of carrying out the Transactions (collectively the "Business of TPG").
Aqua Vie agrees that it will not, except as reasonably required pursuant to this
Agreement, use itself, or divulge, furnish, or make accessible to any person any
knowledge, knowhow, techniques, or information with respect to TPG or the
Business of TPG without the prior written agreement of TPG.
TERMINATION.
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TPG may terminate this agreement, without further obligation or liability,
at any time (i) that TPG has a reasonable basis to believe that any aspect of
the transactions covered by this agreement would constitute a fraud or deception
on the market or (ii) that the Company fails to meet its obligations under this
agreement in a manner which would constitute a material breach. In any such
case, TPG will be entitled to the buyout fee provided for in this agreement.
MISCELLANEOUS.
COVENANT OF FURTHER ASSURANCES. The parties agree to take any further
actions and to execute any further documents which may from time to time be
necessary or appropriate to carry out the purposes of this agreement.
SCOPE OF AGREEMENT. This agreement constitutes the entire understanding of
the parties. No undertakings, warranties or representations have been made other
than as contained herein, and no party shall assert otherwise. This agreement
may not be changed or amended orally.
CURRENCY. All references to currency in this agreement are to United States
Dollars.
REVIEW OF AGREEMENT. Each party acknowledges that it has had time to review
this agreement and, as desired, consult with counsel. In the interpretation of
this agreement, no adverse presumption shall be made against any party on the
basis that it has prepared, or participated in the preparation of, this
agreement.
EFFECTIVE DATE.
The effective date of this agreement is August 31, 1999.
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IN WITNESS WHEREOF, the parties have approved and executed this agreement.
TPG CAPITAL CORPORATION
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President
AQUA VIE BEVERAGE CORPORATION
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PRESIDENT
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WARRANTIES BY OFFICERS, DIRECTORS AND OTHER AFFILIATES
Each of the undersigned officers, directors and other affiliates of Aqua
Vie agree that they have read this agreement and that they (i) will not violate
any of the provision of this agreement relating to compliance with securities
laws, rules and regulations (ii) will not violate any provision of this
agreement relating to confidentiality of the business of TPG and (iii) consent
to be governed by the provisions of this agreement relating to arbitration in
the case of any claims arising from their warranties herein.
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PERSONAL GUARANTEES
In consideration of benefits to be received by Aqua Vie and to them
personally, the following persons, individually and severally, (i) guarantee all
payments required of Aqua Vie under this agreement as and when due (ii) covenant
to take all actions and do all things reasonably required to carry out the
intent and purpose of this agreement, whether as officers, directors,
shareholders or otherwise and (iii) consent to be governed by the provisions of
this agreement relating to arbitration.
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