SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act
August 31, 1999
Date of Report
(Date of Earliest Event Reported)
AQUA VIE BEVERAGE CORPORATION
(Exact Name of Registrant as Specified in its Charter)
333 South Main Street
Ketchum, Idaho 83340
(Address of principal executive offices)
208/622-7792
Registrant's telephone number
BARHILL ACQUISITION CORPORATION
1504 R Street, N.W.
Washington, D.C. 20009
Former name and former address
Delaware 0-24801 82-0506425
(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification No.)
ITEM 1. CHANGES IN CONTROL OF REGISTRANT
(a) Pursuant to an Agreement and Plan of Merger (the
"Merger Agreement") dated as of August 31, 1999 between Barhill
Acquisition Corporation ("Barhill"), a Delaware corporation, and
Aqua Vie Beverage Corporation, a Delaware corporation, all the
outstanding shares of common stock of Barhill Acquisition
Corporation were exchanged for 250,000 shares of common stock of
Aqua Vie Beverage Corporation ("Aqua Vie" or the "Company") in a
transaction in which Aqua Vie was the surviving company.
The Merger Agreement was adopted by the unanimous consent of
the Board of Directors of Barhill and approved by the unanimous
consent of the shareholders of Barhill on August 31, 1999. The
Merger Agreement was adopted by the unanimous consent of the Board
of Directors of Aqua Vie and by the consent of a majority of the
shareholders of Aqua Vie on August 31, 1999.
Prior to the merger, Barhill had 5,000,000 shares of common
stock outstanding which shares were exchanged for 250,000 shares of
common stock of Aqua Vie. By virtue of the merger, Aqua Vie
acquired 100% of the issued and outstanding common stock of Barhill.
Prior to the effectiveness of the merger, Aqua Vie had an
aggregate of 21,785,657 shares of common stock issued and
outstanding, and 3,897.689 shares of Series A preferred stock
outstanding, $.001 par value, 4,987.444 shares of Series B preferred
stock outstanding, $.001 par value, and no shares of Series C
preferred stock outstanding.
Each share of Series A preferred stock is entitled to
approximately 1,800 voting rights on all matters on which
shareholders are entitled to vote and can be converted into shares
of common stock at a ratio of approximately 1,800 shares of common
stock for each share of Series A preferred stock. Series A
preferred stock has a preference on dividends, liquidation and
merger at approximately $1,500 per share.
Each share of Series B preferred stock is entitled to
approximately 10,800 voting rights on all matters on which
shareholders are entitled to vote. Each Series B share can be
converted into shares of common stock on a sliding scale geared to
the market price of Aqua Vie's stock starting at a conversion ratio
of approximately 1,800 shares of common stock for each Series B
share when the common stock is trading at $2.00 per share to a
maximum ratio of approximately 10,800 shares of common stock for
each Series B share when the common stock is trading at $12.00 per
share. Series B preferred stock has a preference on dividends,
liquidation and merger at $30 per share.
Both Series A and Series B preferred stock have adjustment
provisions for sales of common stock by Aqua Vie at a price of less
than $1.65 per share. Holders of both Series A and Series B
preferred stock have a limited right to convert to shares of common
stock over a period of 36 months from the date of issuance. 5% of
the preferred stock may be converted after 12 months, an additional
10% may be converted after 24 months, and the remainder after 36
months. The outstanding preferred shares were issued in October 15,
1998, and up to 5% of both the Series A and Series B preferred
shares may be converted commencing October 15, 1999.
The Company may require conversion on various events,
including the election of 51% of the preferred shares outstanding to
convert, an acquisition, merger or other action by the Company,
after the closing of a public underwriting of $10,000,000, after the
Company shall have a net worth of $10,000,000, or after the common
stock has been listed on the Nasdaq Stock Market for at least three
months. In the event of a mandatory conversion at the election of
the Company, any enhanced voting rights or increased conversion
rights will be fixed at the time of conversion.
Upon effectiveness of the merger, Aqua Vie had an aggregate
of 22,035,657 shares of common stock outstanding.
The officers of Aqua Vie will continue as officers of the
successor issuer. See "Management" below. The officers, directors,
and by-laws of Aqua Vie will continue without change as the
officers, directors, and by-laws of the successor issuer. Pursuant
to the Merger Agreement, the Certificate of Incorporation was
amended to increase the number of authorized shares of common stock
from 50,000,000 to 120,000,000, to permit increases or decreases in
the authorized number of shares of a class without class approval,
and to elect not to be governed by the provisions of Section 203 of
the Delaware General Corporation Law.
A copy of the Merger Agreement is filed as an exhibit to
this Form 8-K and is incorporated in its entirety herein. The
foregoing description is modified by such reference.
(b) The following table contains information regarding the
shareholdings of Aqua Vie's current directors and executive officers
and those persons or entities who beneficially own more than 5% of
its common stock (giving effect to the exercise of the warrants held
by each such person or entity):
Amount of Preferred Stock Percent of
Common Stock Voting Rights Common Stock
Name Beneficially Beneficially
Owned (1) Owned (2)
Thomas Gillespie(3) 1,451,829 53,864,395 73%
President, Director
Joseph J. Wozniak (4) 0 2,417,400 10.3%
Director
Bruce A. Butcher (5) 0 1,800,000 7.6%
Roy Schneiderman (6) 0 1,616,400 6.8%
All directors and 1,451,829 56,281,795 73.7%
executive officers as
as group (2 persons)
* Less than 1% percent
(1) Based upon 22,035,657 outstanding shares of common stock
(subsequent to the effectiveness of the merger).
(2) Assumes exercise of warrants, options or other rights to
purchase securities held by the named shareholder exercisable within
six months of the date hereof.
(3) All 4,987.444 outstanding Series B preferred stock is owned by
Brace Foundation Trust on behalf of seven members of the Gillespie
family, including Thomas Gillespie, who may be deemed to be the
beneficial owner of all the shares. The 4,987.444 Series B
preferred shares have voting rights equal to 53,864,395 common shares.
(4) Mr. Wozniak holds 1,343 shares of Series A preferred stock
which have voting rights equal to 2,417,400 common shares.
(5) Mr. Butcher holds 1,000 shares of Series A preferred stock
which have voting rights equal to 1,800,000 common shares.
(6) Roy Schneiderman holds 898 shares of Series A preferred stock
which having voting rights equal to 1,616,400 common shares.
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
(a) The consideration exchanged pursuant to the Merger
Agreement was negotiated between Barhill and Aqua Vie.
In evaluating Aqua Vie as a candidate for the proposed
merger, Barhill used criteria such as the value of the assets of
Aqua Vie, its spring water beverage products taste and design, its
trademarks, the demand and use of bottled spring water, the
increased use of the Internet as a sales market, Aqua Vie's current
business operations and anticipated operations, and Aqua Vie's
business name and reputation. Barhill determined that the
consideration for the merger was reasonable.
(b) Aqua Vie intends to continue developing and marketing
its flavored water beverage business with the further development,
marketing, and distribution of its naturally flavored spring water
and the possible development of additional lines of beverage products.
BUSINESS
Aqua Vie is a development stage company that has developed
and is marketing several flavors of bottled spring water. Aqua Vie
Beverage Corporation, a Delaware corporation, was incorporated on
July 30, 1998 and was formed as a successor to BEVA Corporation, a
Delaware corporation which was liquidated in bankruptcy in 1997, in
a transaction under Section 251 (g) of the Delaware Business
Corporation Law completed October 14, 1998. BEVA Corporation is a
wholly owned subsidiary of Aqua Vie.
Although there is intense competition in the bottled water
market by companies far larger and better capitalized than Aqua Vie,
management believes the flavors and natural quality of its products
will allow it to compete successfully with other sources of bottled
water. There is no assurance that Aqua Vie will be able to
successfully compete with other bottled water products.
CURRENT OPERATIONS
Aqua Vie develops, bottles and distributes naturally flavored bottled
spring water offering such flavors as Avalanche (pear and guava flavored
spring water), Bamboo (cherry flavored spring water), Paradise (orange and
peach flavored spring water), Harvest (strawberry flavored spring water)
and other flavors. These product lines and formulations were acquired
in the purchase of assets from the predecessor company in liquidation.
There are three additional beverage product lines that are currently
being developed. Aqua Vie currently utilizes the Internet to generate
sales and maintains an Internet web site at http://www.aquavie.com.
Aqua Vie has bottling and labeling arrangements with Lyons Magnus
Company, a large contract bottler located in Fresno, California and
arrangements for foreign bottling in France. Sales to date have been
minimal, and the Company has a small inventory of product which it is
utilizing for marketing purposes. Additional capital will be required
to support the inventory required for robust sales.
SUPPLIERS
Aqua Vie has three primary suppliers for its product: Lyons-Magnus,
a contract bottler company, Fresno, California, International Flavors &
Fragrances, a beverage syrup company, Dayton, New Jersey, and Seal-It, a
shrink wrap label company, Farmingdale, New York. The bottler has to be
considered as a single or limited source as Aqua Vie utilizes the aseptic
bottling process and it is one of the few bottlers which has this capability
in the United States.
Shipments of bottled spring water are sent directly from warehouses
proximate to the bottling companies. The aseptic bottling process,
utilized by Aqua Vie, eliminates the use of preservatives. There are a
limited number of bottlers in the United States which have the aseptic
bottling process available. Aqua Vie intends to select its bottlers upon
availability of the aseptic bottling system and geographic location.
RAW MATERIALS
Aqua Vie utilizes readily available standard PET bottles and sportscaps
as its bottling medium. The main volume of the product is still water
which is generally readily available. The shrink wrap labels are available
from several major sources. The shrink wrap label supplier selected by the
Company provides the best combination of label quality, delivery schedule
and pricing break points for volume purchases. The main ingredient is the
all natural flavored syrups which gives the product its unique tastes and
qualities. The main supplier of the syrup is International Flavors &
Fragrances which is a large flavor house, although several flavors are
furnished by another flavor source.
MARKETING
The Company currently does not have shelving arrangements with any
large retailers, but is actively seeking such arrangements. Marketing
and sales are currently through radio and the Internet.
TRADEMARKS
Aqua Vie has no patents or licenses. Aqua Vie has certain trademarked
and copy righted names and proprietary secrets as regards the various
beverage formulations. It is believed that the various trademarked and
copyrighted material are unique to the Company but that replacement
identities are available.
PROPERTY
Aqua Vie maintains its administrative offices at 333 South Main Street,
Sun Valley/Ketchum, Idaho 83340 under an annual lease of $7,833 per month
for approximately 3,776 square feet.
LITIGATION
Thomas Gillespie and Joseph J. Wozniak are both party defendants in
an action for the payment of approximately $67,000 in legal fees brought
by the law firm that was engaged by Mr. Gillespie to obtain the
confirmation of the reorganization of the original Aqua Vie Beverage
Corporation in bankruptcy court. The law firm was unsuccessful in
achieving reorganization confirmation or in the obtaining of the closing
of the bankruptcy liquidation sale of the corporate assets held by the
bankruptcy court. Mr. Gillespie and Mr. Wozniak have countersued
for the refunding of $117,000 paid in fees to the law firm.
MARKET FOR AQUA VIE'S SECURITIES
Aqua Vie has been a non-reporting publicly traded company with
certain of its securities exempt from registration under the Securities
Act of 1933 pursuant to Rules 504 of Regulation D and Rule 701 of the
General Rules and Regulations of the Securities and Exchange Commission.
Aqua Vie's common stock is traded on the OTC Bulletin Board operated by
Nasdaq under the symbol AVBC. Aqua Vie did not file a registration
statement with the Securities and Exchange Commission and has not been
a reporting company under the Securities Exchange Act of 1934. The
Nasdaq Stock Market has implemented a change in its rules requiring
all companies trading securities on the OTC Bulletin Board to become
reporting companies under the Securities Exchange Act of 1934. Until
such registration is achieved the Company's trading symbol is AVBCE
to indicate its non-reporting status.
The Company was required to become a reporting company by the close
of business on September 1, 1999 or no longer be listed on the OTC
Bulletin Board. Aqua Vie has effected the merger with Barhill and has
become a successor issuer thereto in order to comply with the reporting
company requirements implemented by the Nasdaq Stock Market.
The following table represents the average prices for the Company's
common stock:
Opening High Low Closing
Price Bid Bid Bid Volume
July, 1999 0.5625 1.2188 0.5625 1.125 208,000
June, 1999 0.875 0.875 0.5312 0.5781 209,400
May, 1999 0.7656 0.875 0.75 0.8125 259,300
December, 1998 0.5312 0.5312 0.1406 0.1406 1,029,300
October, 1998 1.4844 1.56525 1.1719 1.25 110,900
May, 1998 1.875 1.9531 1.7969 1.7969 146,800
MANAGEMENT
Name Age Title
Thomas Gillespie 53 President, Director
Joseph J. Wozniak 61 Vice President, Secretary, Director
Thomas Gillespie is the founder of Aqua Vie and has served as President,
a director and its controlling shareholder since its formation in 1998.
Since 1996, Mr. Gillespie has owned Aqua Vie Advance Corporation. From
1991 to 1997, Mr. Gillespie served in various positions with Aqua Vie
Beverage Corporation, the predecessor corporation to Aqua Vie's subsidiary,
BEVA Corporation, which was liquidated in bankruptcy in 1997. From 1986 to
1991, Mr. Gillespie was the principal of Kauai Water Company, Kauai,
Hawaii. Prior to 1986, Mr. Gillespie founded and served as president of
Marketing Design, a retail package design and product development company.
Joseph J. Wozniak has served as Vice President, Secretary and a
director of Aqua Vie since its formation in 1998. From 1996 to
1997, Mr. Wozniak assisted with the reorganization and bankruptcy of
the predecessor Aqua Vie Beverage Corporation. Since 1993, Mr. Wozniak
has worked as a consultant for various start up entities assisting in the
creation of business plans and corporate organizations and reorganizations.
EXECUTIVE COMPENSATION
Thomas Gillespie, as president, receives $20,000 per month. He has no
form of other compensation.
Joseph J. Wozniak receives $10,000 per month. Mr. Wozniak has a stock
earn-out agreement which runs through January 15, 2000.
RELATED TRANSACTIONS
Thomas Gillespie, President, a director and controlling shareholder,
has provided approximately $40,000 as an unsecured loan to Aqua Vie.
RISK FACTORS
AQUA VIE IS CURRENTLY OPERATING AT A LOSS. Revenues from
Aqua Vie's sales to date have not been sufficient to cover the costs
of such operations and Aqua Vie has borrowed funds to maintain its
operations. Its ability to develop operations is dependent upon its
ability to advertise its products and generate sales of its line of
flavored spring water products. If Aqua Vie is unable to sell
sufficient amount of its flavored spring water products at a
sufficiently profitable level, it will need to raise additional
capital through the placement of its securities or from other debt
or equity financing. If the Company is not able to raise such
financing or to obtain alternative sources of funding, management
will be required to curtail operations. There is no assurance that
the Company will be able to continue to operate if additional sales
cannot be generated.
AQUA VIE COMMENCED OPERATIONS IN 1998 AND HAS A LIMITED
OPERATING HISTORY. Aqua Vie commenced operations in 1998 and has
only a limited history of operations which to date have not been
profitable. Its operations are subject to the risks and competition
inherent in the establishment of a relatively new business
enterprise. There can be no assurance that future operations will
be profitable. Revenues and profits, if any, will depend upon
various factors, including market acceptance of its concepts, market
awareness, reliability and acceptance of the Internet,
dependability of its distribution network, and general economic
conditions. There is no assurance that Aqua Vie will achieve its
expansion goals and the failure to achieve such goals would have an
adverse impact on it.
AQUA VIE'S ISSUED PREFERRED STOCK HAS SUPER MAJORITY VOTING
RIGHTS. Aqua Vie has designated 200,000 shares of Series A
preferred stock of which approximately 3,897.689 are issued. Each
share of Series A preferred stock entitles the holder to 1,800
voting rights for an aggregate of approximately 7,015,860 for all
Class A shares on all matters on which shareholders are entitled to
vote. Aqua Vie has designated 200,000 shares of Series B preferred
stock of which approximately 4,987.444 are issued. Each share of
Series B preferred stock entitles the holder to 10,800 voting rights
for an aggregate of approximately 53,863,392 votes for all Class B
shares on all matters on which shareholders are entitled to vote.
All the outstanding Class B shares are held by the Brace Foundation
of which Thomas Gillespie is one of the beneficiaries and for which
he holds all the voting proxies. In addition, Aqua Vie may, without
further action or vote by its shareholders, designate and issue
additional series or shares of preferred stock.
The terms of the super majority preferred stock adversely
affect the voting power of the holders of the common stock and may
in turn reduce the value of the common stock. Such designation and
issuance of preferred stock favorable to current management or
shareholders makes the possible takeover of the Company or the
removal of management of the Company very difficult and discourages
hostile bids for control of the Company which bids might have
provided shareholders with premiums for their shares.
VOTING CONTROL OF AQUA VIE BY PRESIDENT. Thomas Gillespie,
founder, President and a director of Aqua Vie, owns and controls
beneficially the voting rights ascribed to all the outstanding
Series B preferred shares aggregating a total of approximately
53,867,160 votes. Through such voting rights, Thomas Gillespie may
control the vote of all matters brought before the shareholders and
holders of the common stock may have no power in corporate decisions
usually brought before the shareholders for shareholder vote.
ADVANCES TO AN AFFILIATE. Aqua Vie has borrowed
approximately $40,000 from its president and controlling
shareholder. If it is unable to generate additional sales or other
revenues sources, Aqua Vie may require additional borrowings in
order to continue development of its operations. The current loan
to the affiliate is unsecured.
LACK OF CONTINUED DEVELOPMENT OF E-COMMERCE MARKET. The use
of the Internet and World Wide Web for commercial purposes is
expanding dramatically. There is no assurance, however, that as
increased commerce takes place on the Internet that unforeseen
overloads, lack of sufficient hardware, telephone availability or
other problems may develop. In addition, consumer use of the
Internet for purchases, banking, and other commercial uses may
decline for any number of reasons such as security problems,
overload difficulties, shopping trends, or slow Internet access.
COMPETITION FROM LARGER AND MORE ESTABLISHED COMPANIES MAY
HAMPER MARKETABILITY. The competition in the bottled water industry
is intense. There are numerous well-established competitors,
including national, regional and local companies possessing
substantially greater financial, marketing, personnel and other
resources than Aqua Vie. Aqua Vie may not be able to market or sell
its products if faced with direct product competition from these
larger and more established bottled water companies.
TRADEMARK PROTECTION AND PROPRIETARY MARKS.
Notwithstanding the pending registration of certain trade names with
the United States Trademark Office, there is no assurance that Aqua
Vie will be able to enforce against use of any of its marks. There
is also no assurance that Aqua Vie will be able to prevent
competitors from using the same or similar names, marks, concepts or
appearances or that it will have the financial resources necessary
to protect its marks against infringing use.
MANAGEMENT AND AFFILIATES OWN ENOUGH SHARES TO CONTROL
SHAREHOLDER VOTE. Aqua Vie's executive officers and directors
beneficially own approximately 6.6% of the outstanding common stock
of Aqua Vie (not including conversion of any preferred stock), but
have voting rights equal to approximately 73% of the outstanding
vote. As a result, these executive officers are able to exercise
controlling interest over matters requiring stockholder approval,
including the election of directors and the approval of material
corporate matters such as change of control transactions. The
effects of such control could be to delay or prevent a change of
control of Aqua Vie unless the terms are approved by such stockholders.
ISSUANCE OF FUTURE SHARES MAY DILUTE INVESTORS SHARE VALUE.
The Certificate of Incorporation as amended of Aqua Vie authorizes
the issuance of 120,000,000 shares of common stock and 1,000,000
shares of preferred stock. The future issuance of all or part of
the remaining authorized common stock may result in substantial
dilution in the percentage of the Company's common stock held by the
its then existing shareholders. Moreover, any common stock issued
in the future may be valued on an arbitrary basis by Aqua Vie. The
issuance of the Company's shares for future services or acquisitions
or other corporate actions may have the effect of diluting the value
of the shares held by investors, and might have an adverse effect on
any trading market, should a trading market develop for the
Company's common stock.
CURRENT TRADING MARKET FOR THE COMPANY'S SECURITIES. Aqua
Vie's common stock is traded on the OTC Bulletin Board operated by
Nasdaq under the symbol AVBC. Aqua Vie did not file a registration
statement with the Securities and Exchange Commission and has not
been a reporting company under the Securities Exchange Act of 1934.
The Nasdaq Stock Market has implemented a change in its rules
requiring all companies trading securities on the OTC Bulletin Board
to be registered as a reporting company. Until such registration is
achieved the Company's trading symbol is AVBCE to indicate its
non-reporting status. The Company was required to become a
reporting company by the close of business on September 1, 1999 or
no longer be listed on the OTC Bulletin Board. Aqua Vie has
effected the merger with Barhill and has become a successor issuer
thereto in order to comply with the reporting company requirements
implemented by the Nasdaq Stock Market. No assurance can be given
that an active trading market in the Company's securities will be
sustained if it is able to retain its listed status.
PENNY STOCK REGULATION. Upon commencement of trading in the
Company's stock, if such continues (of which there can be no
assurance) the Company's common stock may be deemed a penny stock.
Penny stocks generally are equity securities with a price of less
than $5.00 per share other than securities registered on certain
national securities exchanges or quoted on the Nasdaq Stock Market,
provided that current price and volume information with respect to
transactions in such securities is provided by the exchange or
system. The Company's securities may be subject to "penny stock
rules" that impose additional sales practice requirements on
broker-dealers who sell such securities to persons other than
established customers and accredited investors (generally those with
assets in excess of $1,000,000 or annual income exceeding $200,000
or $300,000 together with their spouse). For transactions covered
by these rules, the broker-dealer must make a special suitability
determination for the purchase of such securities and have received
the purchaser's written consent to the transaction prior to the
purchase. Additionally, for any transaction involving a penny
stock, unless exempt, the "penny stock rules" require the delivery,
prior to the transaction, of a disclosure schedule prescribed by the
Commission relating to the penny stock market. The broker-dealer
also must disclose the commissions payable to both the broker-dealer
and the registered representative and current quotations for the
securities. Finally, monthly statements must be sent disclosing
recent price information on the limited market in penny stocks.
Consequently, the "penny stock rules" may restrict the ability of
broker-dealers to sell the Company's securities. The foregoing
required penny stock restrictions will not apply to the Company's
securities if such securities maintain a market price of $5.00 or
greater. There can be no assurance that the price of the Company's
securities will reach or maintain such a level.
COMPUTER SYSTEMS REDESIGNED FOR YEAR 2000. Many existing
computer programs use only two digits to identify a year in such
program's date field. These programs were designed and developed
without consideration of the impact of the change in the century for
which four digits will be required to accurately report the date.
If not corrected, many computer applications could fail or create
erroneous results by or following the year 2000 (the "Year 2000
problem"). Many of the computer programs containing such date
language problems have been corrected by the companies or
governments operating such programs. The Company's operations are
dependent upon the timely delivery of supplies which deliveries and
production of bottled water may be delayed or canceled because of
such Year 2000 problem computer failures. The Company does not know
what steps, if any, have been taken by any of its suppliers or
bottlers in regard to the Year 2000 problems. The Company's
operations will be severally curtailed if one or more of its
suppliers were to suffer Year 2000 problems. Furthermore, it is
impossible to predict if the basic utilities serving the company,
its bottlers, or suppliers will continue uninterrupted.
ITEM 3. BANKRUPTCY OR RECEIVERSHIP
Aqua Vie Beverage Corporation, the predecessor corporation
of the Company's subsidiary BEVA Corporation, was incorporated in
the state of Delaware on March 30, 1990 as the JIB Group, Inc. and
changed its name on January 22, 1991 to Aqua Vie Beverage Corporation. The
original Aqua Vie Beverage Corporation was placed into involuntary
Chapter 11 bankruptcy in January 1995 as a move in a hostile
takeover attempt and a trustee was assigned. From January 1995 to
November 1996, Mr. Gillespie attempted to reorganize the original
Aqua Vie Beverage Corporation and regain management control. This
was not effected and in early November 1996 it was decided and
agreed to with the trustee to acquire the assets, the corporate and
the corporate shell through a bankruptcy liquidation sale. In
September 1997, a bill of sale was obtained from the bankruptcy
trustee and the assets were purchased. Subsequently a
reorganization was effected pursuant to a merger under Section
251(g) of the Delaware General Business Corporation Law in October
1998. Except for the time under control of the bankruptcy trustee,
Mr. Gillespie was the chief executive officer of the original Aqua
Vie Beverage Corporation.
ITEM 4. CHANGES IN REGISTRANT'S CERTIFYING ACCOUNTANT
Not applicable.
ITEM 5. OTHER EVENTS
Successor Issuer Election.
Upon effectiveness of the merger, pursuant to Rule 12g-3(a)
of the General Rules and Regulations of the Securities and Exchange
Commission, Aqua Vie became the successor issuer to Barhill
Acquisition Corporation for reporting purposes under the Securities
Exchange Act of 1934 and elects to report under the Act effective on
September 1, 1999.
ITEM 6. RESIGNATIONS OF DIRECTORS AND EXECUTIVE OFFICERS
Not applicable.
ITEM 7. FINANCIAL STATEMENTS
No financial statements are filed herewith. The Registrant
shall file financial statements by amendment hereto not later than
60 days after the date that this initial report on Form 8-K must be
filed.
ITEM 8. CHANGE IN FISCAL YEAR
The successor issuer is adopting a fiscal year end of July
31. The Company will file a transitional annual report as required.
EXHIBITS
1.1 Agreement and Plan of Merger and amendment thereto between
Barhill Acquisition Corporation and Aqua Vie Beverage
Corporation.
1.2 Original unamended Certificate of Incorporation of Aqua vie
Beverage Corporation-H
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant has duly caused this report to be signed on its
behalf by the undersigned hereunto duly authorized.
AQUA VIE BEVERAGE CORPORATION
By /s/ Thomas Gillespie
Date: September 1, 1999
AGREEMENT AND PLAN OF MERGER between BARHILL ACQUISITION
CORPORATION, a Delaware corporation ("Barhill"), and AQUA VIE
BEVERAGE CORPORATION, a Delaware corporation ("Aqua Vie"), Barhill
and Aqua Vie being sometimes referred to herein as the "Constituent
Corporations."
WHEREAS, the board of directors of each Constituent
Corporation deems it advisable that the Constituent Corporations
merge into a single corporation in a transaction intended to qualify
as a reorganization within the meaning of Section368(a)(1)(A) of the
Internal Revenue Code of 1986, as amended ("the Merger");
NOW, THEREFORE, in consideration of the premises and the
respective mutual covenants, representations and warranties herein
contained, the parties agree as follows:
1. SURVIVING CORPORATION. Barhill shall be merged with
and into Aqua Vie which shall be the surviving reporting corporation
(hereinafter the "Surviving Corporation") in accordance with the
applicable laws of the State of Delaware.
2. MERGER DATE. The Merger shall become effective (the
"Merger Date") upon the completion of:
2.1 Adoption of this Agreement by the shareholders of
Barhill pursuant to the General Corporation Law of Delaware and by
the shareholders of Aqua Vie by a vote of the shareholders ratified
by the Board of Directors of Aqua Vie, pursuant to the Business
Corporation Law of Delaware.
2.2 Execution and filing of the Certificate of Merger
with the Secretary of State of the State of Delaware in accordance
with the General Corporation Law of Delaware.
3. TIME OF FILINGS. The Certificate of Merger shall be
filed with the Secretary of State of Delaware upon the approval of
this Agreement by the shareholders of the Constituent Corporations
and the fulfillment or waiver of the terms and conditions herein.
4. GOVERNING LAW. The Surviving Corporation shall be
governed by the laws of the State of Delaware.
5. CERTIFICATE OF INCORPORATION. The Certificate of
Incorporation of Aqua Vie shall be the Certificate of Incorporation
of the Surviving Corporation from and after the Merger Date, subject
to the following changes in its Certificate of Incorporation:
ARTICLE FOURTH: The first complete sentence of Article
Fourth of the Certificate of Incorporation of AQUA VIE
BEVERAGE CORPORATION shall be amended to read as follows:
"The aggregate number of shares of common stock which
the corporation shall have authority to issue is One
Hundred Twenty Million, $.001 par value per share".
ARTICLE FOURTH: Article Fourth is further amended to add a
new Subsection D which shall provide as follows:
"The authorized shares of a class of stock may be
increased or decreased without the approval of the
shares of that class, but not below the number of
shares issued unless a combination shall have occurred."
ARTICLE FOURTEENTH: A new Article Fourteenth is added to
read as follows:
"Section 203 of the Delaware General Corporation Law
shall not be applicable to the Corporation.
6. BYLAWS. The Bylaws of the Surviving Corporation
shall be the Bylaws of Aqua Vie as in effect on the date of this
Agreement.
7. NAME OF SURVIVING CORPORATION. The Surviving
Corporation will continue to use its name "Aqua Vie Beverage
Corporation" or such name as it may choose and shall be available.
8. CONVERSION. The mode of carrying the merger into
effect and the manner and basis of converting the shares of Barhill
into shares of the Surviving Corporation are as follows:
8.1 The aggregate number of shares of Barhill Common
Stock issued and outstanding on the Merger Date shall, by virtue of
the merger and without any action on the part of the holders
thereof, be converted into an aggregate of 250,000 shares of Aqua
Vie Common Stock adjusted by any increase for fractional shares and
reduced by any Dissenting Shares (defined below).
8.2 At June 30, 1999, there were issued and outstanding
approximately 21,785,657 shares of Common Stock of Aqua Vie.
8.3 The Aqua Vie Common Stock shall be issued to the
holders of such Barhill Common Stock in exchange for their shares on
a pro rata basis in accordance with each holder's relative ownership
of the Barhill Common Stock that is being exchanged.
8.4 All outstanding warrants of Barhill and any other
outstanding rights to purchase stock of Barhill shall be adjusted,
pursuant to the terms contained in such warrants or other rights
documents, for conversion to warrants or rights to purchase stock of
Aqua Vie on the same ratio as provided herein for holders of Aqua
Vie Common Stock.
8.5 The shares of Aqua Vie Common Stock to be issued in
exchange for Barhill Common Stock hereunder shall be proportionately
reduced by any shares owned by Barhill shareholders who shall have
timely objected to the merger (the "Dissenting Shares") in
accordance with the provisions of General Corporation Law of
Delaware which objections will be dealt with as provided in those
sections.
8.6 Each share of Barhill Common Stock that is issued and
outstanding and owned by Barhill on the Merger Date shall, by virtue
of the merger and without any action on the part of Barhill, be
retired and canceled.
8.7 Each certificate evidencing ownership of shares of
Aqua Vie Common Stock issued and outstanding on the Merger Date or
held by Aqua Vie in its treasury shall continue to evidence
ownership of the same number of shares of Aqua Vie Common Stock.
9. EXCHANGE OF CERTIFICATES. As promptly as practicable
after the Merger Date, each holder of an outstanding certificate or
certificates theretofore representing shares of Barhill Common Stock
(other than certificates representing Dissenting Shares) shall
surrender such certificate(s) for cancellation to the party
designated by the Surviving Corporation to handle such exchange (the
"Exchange Agent"), and shall receive in exchange a certificate or
certificates representing the number of full shares of Aqua Vie
Common Stock into which the shares of Barhill Common Stock
represented by the certificate or certificates so surrendered shall
have been converted.
10. UNEXCHANGED CERTIFICATES. Until surrendered, each
outstanding certificate that prior to the Merger Date represented
Barhill Common Stock (other than certificates representing
Dissenting Shares) shall be deemed for all purposes, other than the
payment of dividends or other distributions, to evidence ownership
of the number of shares of Aqua Vie Common Stock into which it was
converted. No dividend or other distribution payable to holders of
Aqua Vie Common Stock as of any date subsequent to the Merger Date
shall be paid to the holders of outstanding certificates of Barhill
Common Stock; provided, however, that upon surrender and exchange of
such outstanding certificates (other than certificates representing
Dissenting Shares), there shall be paid to the record holders of the
certificates issued in exchange therefor the amount, without
interest thereon, of dividends and other distributions that would
have been payable subsequent to the Merger Date with respect to the
shares of Aqua Vie Common Stock represented thereby.
11. BOARD OF DIRECTORS AND OFFICERS. The members of the
board of directors of the Surviving Corporation shall be the members
of the board of directors of Aqua Vie on the Merger Date or such
others as Aqua Vie may designate. The officers of the Surviving
Corporation shall be the officers of Aqua Vie on the Merger Date or
such others as Aqua Vie may designate.
12. EFFECT OF THE MERGER. On the Merger Date, the
separate existence of Barhill shall cease (except insofar as
continued by statute), and it shall be merged with and into the
Surviving Corporation. All the property, real, personal, and mixed,
of each of the Constituent Corporations, and all debts due to either
of them, shall be transferred to and vested in the Surviving
Corporation, without further act or deed. The Surviving Corporation
shall thenceforth be responsible and liable for all the liabilities
and obligations, including liabilities to holders of Dissenting
Shares, of each of the Constituent Corporations, and any claim or
judgment against either of the Constituent Corporations may be
enforced against the Surviving Corporation.
13. APPROVAL OF SHAREHOLDERS. This Agreement shall be
adopted by the shareholders of the Constituent Corporations at
meetings of such shareholders called for that purpose or by written
consent pursuant to the laws applicable thereto. There shall be
required for the adoption of this Agreement the affirmative vote of
the holders of at least a majority of the holders of all the shares
of the Common Stock issued and outstanding and entitled to vote for
each of the Constituent Corporations.
14. REPRESENTATIONS AND WARRANTIES OF BARHILL. Barhill
represents and warrants that:
14.1 CORPORATE ORGANIZATION AND GOOD STANDING. Barhill is
a corporation duly organized, validly existing, and in good standing
under the laws of the State of Delaware, and is qualified to do
business as a foreign corporation in each jurisdiction, if any, in
which its property or business requires such qualification.
14.2 REPORTING COMPANY. Barhill has filed with the
Securities and Exchange Commission a registration statement on Form
F-10 which became effective pursuant to the Securities Exchange Act
of 1934 and is a reporting company pursuant to Section12 thereunder.
14.3 REPORTING COMPANY STATUS. Barhill has timely filed
and is current on all reports required to be filed by it pursuant to
Section12(g) of the Securities Exchange Act of 1934.
14.4 CAPITALIZATION. Barhill's authorized capital stock
consists of 120,000,000 shares of Common Stock, $.0001 par value, of
which 5,000,000 shares are issued and outstanding, and 20,000,000
shares of non-designated preferred stock of which no shares are
designated or issued.
14.5 ISSUANCE OF STOCK. All the outstanding shares of its
Common Stock are duly authorized and validly issued, fully paid and
non-assessable.
14.6 STOCK RIGHTS. There are no stock grants, options,
rights, warrants or other rights to purchase or obtain the Barhill
Common or Preferred Stock issued or committed to be issued.
14.7 CORPORATE AUTHORITY. Barhill has all requisite
corporate power and authority to own, operate and lease its
properties, to carry on its business as it is now being conducted
and to execute, deliver, perform and conclude the transactions
contemplated by this Agreement and all other agreements and
instruments related to this Agreement.
14.8 AUTHORIZATION. Execution of this Agreement has been
duly authorized and approved by Barhill's board of directors.
14.9 SUBSIDIARIES. Barhill has no subsidiaries.
14.10 FINANCIAL STATEMENTS. Barhill's audited financial
statements dated December 31, 1998, copies of which will have been
delivered by Barhill to Aqua Vie prior to the Merger Date (the
"Barhill Financial Statements"), fairly present the financial
condition of Barhill as of the date therein and the results of its
operations for the periods then ended in conformity with generally
accepted accounting principles consistently applied.
14.11 ABSENCE OF UNDISCLOSED LIABILITIES. Except to the
extent reflected or reserved against in the Barhill Financial
Statements, Barhill did not have at that date any liabilities or
obligations (secured, unsecured, contingent, or otherwise) of a
nature customarily reflected in a corporate balance sheet prepared
in accordance with generally accepted accounting principles.
14.12 NO MATERIAL CHANGES. There has been no material
adverse change in the business, properties, or financial condition
of Barhill since the date of the Barhill Financial Statements.
14.13 LITIGATION. There is not, to the knowledge of
Barhill, any pending, threatened, or existing litigation,
bankruptcy, criminal, civil, or regulatory proceeding or
investigation, threatened or contemplated against Barhill or against
any of its officers.
14.14 CONTRACTS. Barhill is not a party to any material
contract not in the ordinary course of business that is to be
performed in whole or in part at or after the date of this Agreement.
14.15 TITLE. Barhill has good and marketable title to all
the real property and good and valid title to all other property
included in the Barhill Financial Statements. Except as set out in
the balance sheet thereof, the properties of Barhill are not subject
to any mortgage, encumbrance, or lien of any kind except minor
encumbrances that do not materially interfere with the use of the
property in the conduct of the business of Barhill.
14.16 TAX RETURNS. All federal, state, county, municipal,
local, foreign and other taxes and assessments, including any and
all interest, penalties and additions imposed with respect to such
amounts, have been properly prepared and filed by Barhill for all
years to and including the taxable year ending December 31, 1998.
Any and all federal, state, county, municipal, local, foreign and
other taxes and assessments, including any and all interest,
penalties and additions imposed with respect to such amounts for the
year ending December 31, 1998, have been paid or if any is
outstanding as at the date hereof provision has been made prorated
to the date hereof to be an adjustment to the credit of Aqua Vie
payable to Aqua Vie on the merger hereof. The provisions for
federal and state taxes reflected in the Barhill Financial
Statements are adequate to cover any such taxes that may be assessed
against Barhill in respect of its business and its operations during
the periods covered by the Barhill Financial Statements and all
prior periods.
14.17 NO VIOLATION. Consummation of the merger will not
constitute or result in a breach or default under any provision of
any charter, bylaw, indenture, mortgage, lease, or agreement, or any
order, judgment, decree, law, or regulation to which any property of
Barhill is subject or by which Barhill is bound.
15. REPRESENTATIONS AND WARRANTIES OF AQUA VIE. Aqua Vie
represents and warrants that:
15.1 CORPORATE ORGANIZATION AND GOOD STANDING. Aqua Vie
is a corporation duly organized, validly existing, and in good
standing under the laws of the State of Delaware and is qualified to
do business as a foreign corporation in each jurisdiction, if any,
in which its property or business requires such qualification.
15.2 CAPITALIZATION. Aqua Vie's authorized capital stock
consists of 50,000,000 shares of Common Stock, $.001 par value, of
which 21,785,657 shares are issued and outstanding, and 1,000,000
shares of Preferred Stock, $.001 par value, of which 3,897.689
shares of Series A and 4,987.444 shares of Series B Preferred Stock
have been issued. Each Series A share of Preferred Stock is
entitled to 1,800 voting rights on all matters on which shareholders
are entitled to vote and can be converted into shares of Common
Stock at a ratio of 1,800 shares of common stock for each Series A
share. Each Series B share of Preferred Stock is entitled to 10,800
voting rights on all matters on which shareholders are entitled to
vote. Each Series B share can be converted into shares of common
stock on a sliding scale geared to the market price of Aqua Vie's
stock starting at a conversion ratio of 1,800 shares of Common Stock
for each Series B share when the Common Stock is trading at $2.00
per share to a maximum ratio of 10,800 shares of Common Stock for
each Series B share when the Common Stock is trading at $12.00 per
share.
15.3 ISSUED STOCK. All the outstanding shares of its
Common Stock are duly authorized and validly issued, fully paid and
non-assessable.
15.4 CORPORATE AUTHORITY. Aqua Vie has all requisite
corporate power and authority to own, operate and lease its
properties, to carry on its business as it is now being conducted
and to execute, deliver, perform and conclude the transactions
contemplated by this Agreement and all other agreements and
instruments related to this Agreement.
15.5 AUTHORIZATION. Execution of this Agreement has been
duly authorized and approved by Aqua Vie's board of directors.
15.6 SUBSIDIARIES. Aqua Vie has one subsidiary.
15.7 FINANCIAL STATEMENTS. Aqua Vie's unaudited financial
statements of May 30, 1999, copies of which will have been delivered
by Aqua Vie to Barhill by the Merger Date (the "Aqua Vie Financial
Statements"), are believed to be substantially correct and fairly
present the financial condition of Aqua Vie as of the date therein
and the results of its operations for the periods then ended in
conformity with generally accepted accounting principles
consistently applied.
15.8 ABSENCE OF UNDISCLOSED LIABILITIES. Except to the
extent reflected or reserved against in the Aqua Vie Financial
Statements, Aqua Vie did not have at that date any liabilities or
obligations (secured, unsecured, contingent, or otherwise) of a
nature customarily reflected in a corporate balance sheet prepared
in accordance with generally accepted accounting principles.
15.9 NO MATERIAL CHANGES. There has been no material
adverse change in the business, properties, or financial condition
of Aqua Vie since the date of the Aqua Vie Financial Statements.
15.10 LITIGATION. There is not, to the knowledge of Aqua
Vie, any pending, threatened, or existing litigation, bankruptcy,
criminal, civil, or regulatory proceeding or investigation,
threatened or contemplated against Aqua Vie or against any of its
officers.
15.11 CONTRACTS. Aqua Vie is not a party to any material
contract not in the ordinary course of business that is to be
performed in whole or in part at or after the date of this Agreement.
15.12 TITLE. Aqua Vie has good and marketable title to all
the real property and good and valid title to all other property
included in the Aqua Vie Financial Statements. Except as set out in
the balance sheet thereof, the properties of Aqua Vie are not
subject to any mortgage, encumbrance, or lien of any kind except
minor encumbrances that do not materially interfere with the use of
the property in the conduct of the business of Aqua Vie.
15.13 NO VIOLATION. Consummation of the merger will not
constitute or result in a breach or default under any provision of
any charter, bylaw, indenture, mortgage, lease, or agreement, or any
order, judgment, decree, law, or regulation to which any property of
Aqua Vie is subject or by which Aqua Vie is bound.
16. CONDUCT OF BARHILL PENDING THE MERGER DATE. Barhill
covenants that between the date of this Agreement and the Merger Date:
16.1 No change will be made in Barhill's articles of
incorporation or bylaws.
16.2 Barhill will not make any change in its authorized or
issued capital stock, declare or pay any dividend or other
distribution or issue, encumber, purchase, or otherwise acquire any
of its capital stock other than as provided herein.
16.3 Barhill will submit this Agreement for its
shareholders' approval with a favorable recommendation by its board
of directors and will use its best efforts to obtain the requisite
shareholder approval.
16.4 Barhill will use its best efforts to maintain and
preserve its business organization, employee relationships, and
goodwill intact, and will not enter into any material commitment
except in the ordinary course of business.
17. CONDUCT OF AQUA VIE PENDING THE MERGER DATE. Aqua
Vie covenants that between the date of this Agreement and the Merger
Date:
17.1 No change will be made in Aqua Vie's certificate of
incorporation or bylaws.
17.2 Aqua Vie will not make any change in its authorized
or issued capital stock, declare or pay any dividend or other
distribution or issue, encumber, purchase, or otherwise acquire any
of its capital stock otherwise than as provided herein.
17.3 Aqua Vie will submit this Agreement for its
shareholders' approval with a favorable recommendation by its board
of directors and will use its best efforts to obtain the requisite
shareholder approval.
17.4 Aqua Vie will use its best efforts to maintain and
preserve its business organization, employee relationships, and
goodwill intact, and will not enter into any material commitment
except in the ordinary course of business.
18. CONDITIONS PRECEDENT TO OBLIGATION OF BARHILL.
Barhill's obligation to consummate this merger shall be subject to
fulfillment on or before the Merger Date of each of the following
conditions, unless waived in writing by Barhill:
18.1 AQUA VIE'S REPRESENTATIONS AND WARRANTIES. The
representations and warranties of Aqua Vie set forth herein shall be
true and correct at the Merger Date as though made at and as of that
date, except as affected by transactions contemplated hereby.
18.2 AQUA VIE'S COVENANTS. Aqua Vie shall have performed
all covenants required by this Agreement to be performed by it on or
before the Merger Date.
18.3 SHAREHOLDER APPROVAL. This Agreement shall have been
approved by the required number of shareholders of the Constituent
Corporations.
18.4 SUPPORTING DOCUMENTS OF AQUA VIE. Aqua Vie shall
have delivered to Barhill supporting documents in form and substance
satisfactory to Barhill to the effect that:
(i) Aqua Vie is a corporation duly organized, validly
existing, and in good standing.
(ii) Aqua Vie's authorized and issued capital stock
is as set forth herein.
(iii) The execution and consummation of this
Agreement have been duly authorized and approved by
Aqua Vie's board of directors.
19. CONDITIONS PRECEDENT TO OBLIGATION OF AQUA VIE. Aqua
Vie's obligation to consummate this merger shall be subject to
fulfillment on or before the Merger Date of each of the following
conditions, unless waived in writing by Aqua Vie:
19.1 BARHILL'S REPRESENTATIONS AND WARRANTIES. The
representations and warranties of Barhill set forth herein shall be
true and correct at the Merger Date as though made at and as of that
date, except as affected by transactions contemplated hereby.
19.2 BARHILL'S COVENANTS. Barhill shall have performed
all covenants required by this Agreement to be performed by it on or
before the Merger Date.
19.3 SHAREHOLDER APPROVAL. This Agreement shall have been
approved by the required number of shareholders of the Constituent
Corporations.
19.4 SUPPORTING DOCUMENTS OF BARHILL. Barhill shall have
delivered to Aqua Vie supporting documents in form and substance
satisfactory to Aqua Vie to the effect that:
(i) Barhill is a corporation duly organized, validly
existing, and in good standing.
(ii) Barhill's authorized and issued capital stock is as
set forth herein.
(iii) The execution and consummation of this
Agreement have been duly authorized and approved by
Barhill's board of directors.
20. ACCESS. From the date hereof to the Merger Date,
Aqua Vie and Barhill shall provide each other with such information
and permit each other's officers and representatives such access to
its properties and books and records as the other may from time to
time reasonably request. If the merger is not consummated, all
documents received in connection with this Agreement shall be
returned to the party furnishing such documents, and all information
so received shall be treated as confidential.
21. CLOSING. The transfers and deliveries to be made
pursuant to this Agreement (the "Closing") shall be made by and take
place at the offices of the Exchange Agent or other location
designated by the Constituent Corporations without requiring the
meeting of the parties hereof. All proceedings to be taken and all
documents to be executed at the Closing shall be deemed to have been
taken, delivered and executed simultaneously, and no proceeding
shall be deemed taken nor documents deemed executed or delivered
until all have been taken, delivered and executed.
21.1 Any copy, facsimile telecommunication or other
reliable reproduction of the writing or transmission required by
this Agreement or any signature required thereon may be used in lieu
of an original writing or transmission or signature for any and all
purposes for which the original could be used, provided that such
copy, facsimile telecommunication or other reproduction shall be a
complete reproduction of the entire original writing or transmission
or original signature.
21.2 At the Closing, Barhill shall deliver to the Exchange
Agent in satisfactory form, if not already delivered to Aqua Vie:
(i) A list of the holders of the shares of Barhill Common
Stock being exchanged with an itemization of the number of shares
held by each, the address of each holder, and the aggregate number
of shares of Aqua Vie Common Stock to be issued to each holder;
(ii) Evidence of the consent of shareholders of Barhill to
this Agreement;
(iii) Certificate of the Secretary of State of Delaware as
of a recent date as to the good standing of Barhill;
(iv) Certified copies of the resolutions of the board of
directors of Barhill authorizing the execution of this Agreement and
the consummation of the Merger;
(v) The Barhill Financial Statements;
(vi) Secretary's certificate of incumbency of the officers
and directors of Barhill; and
(vii) Any document as may be specified herein or required
to satisfy the conditions, representations and warranties enumerated
elsewhere herein.
21.3 At the Closing, Aqua Vie shall deliver to the
Exchange Agent in satisfactory form, if not already delivered to
Barhill:
(i) A list of the shareholders of record of Aqua Vie,
including, wherever available, addresses and telephone numbers;
(ii) Evidence of the consent of shareholders of Aqua Vie to
this Agreement;
(iii) Certificate of the Secretary of State of Delaware as
of a recent date as to the good standing of Aqua Vie;
(iv) Certified copies of the resolutions of the board of
directors of Aqua Vie authorizing the execution of this Agreement
and the consummation of the merger;
(v) The Aqua Vie Financial Statements;
(vi) Secretary's certificate of incumbency of the officers
and directors of Aqua Vie; and
(vii) Any document as may be specified herein or required
to satisfy the conditions, representations and warranties enumerated
elsewhere herein.
22. SURVIVAL OF REPRESENTATIONS AND WARRANTIES. The
representations and warranties of the Constituent Corporations set
out herein shall survive the Merger Date.
23. ARBITRATION.
23.1 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.
23.2 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.
23.3 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.
23.4 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.
23.5 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.
23.6 FINALITY AND FEES. Any award 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 arbitration shall pay its own costs
and counsel fees except as specifically provided otherwise in this
agreement.
23.7 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.
23.8 COVENANT NOT TO SUE. 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.
23.9 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.
23.10 SURVIVAL. The provisions for arbitration contained
herein shall survive the termination of this agreement for any reason.
24. GENERAL PROVISIONS.
24.1 FURTHER ASSURANCES. From time to time, each party
will execute such additional instruments and take such actions as
may be reasonably required to carry out the intent and purposes of
this Agreement.
24.2 WAIVER. Any failure on the part of either party
hereto to comply with any of its obligations, agreements, or
conditions hereunder may be waived in writing by the party to whom
such compliance is owed.
24.3 BROKERS. Each party agrees to indemnify and hold
harmless the other party against any fee, loss, or expense arising
out of claims by brokers or finders employed or alleged to have been
employed by the indemnifying party.
24.4 NOTICES. All notices and other communications
hereunder shall be in writing and shall be deemed to have been given
if delivered in person or sent by prepaid first-class certified
mail, return receipt requested, or recognized commercial courier
service, as follows:
If to Barhill, to:
Barhill Acquisition Corporation
1504 R Street, N.W.
Washington, D.C. 20009
If to Aqua Vie, to
Aqua Vie Beverage Corporation
PO Box 6759
333 South Main Street
Ketchum, Idaho 83340
25 GOVERNING LAW. This Agreement shall be governed by
and construed and enforced in accordance with the laws of the State
of Delaware.
26. ASSIGNMENT. This Agreement shall inure to the
benefit of, and be binding upon, the parties hereto and their
successors and assigns; provided, however, that any assignment by
either party of its rights under this Agreement without the written
consent of the other party shall be void.
27. COUNTERPARTS. This Agreement may be executed
simultaneously in two or more counterparts, each of which shall be
deemed an original, but all of which together shall constitute one
and the same instrument. Signatures sent by facsimile transmission
shall be deemed to be evidence of the original execution thereof.
28. EXCHANGE AGENT AND CLOSING DATE. The Exchange Agent
shall be Cassidy & Associates. Closing shall take place on August
31, 1999, or as soon thereafter as practicable. The date of
Closing may be accelerated or extended by agreement of the parties.
29. EFFECTIVE DATE. This effective date of this Agreement
shall be August 31, 1999.
SIGNATURE PAGE TO AGREEMENT AND PLAN OF MERGER
BETWEEN BARHILL ACQUISITION CORPORATION AND
AQUA VIE BEVERAGE CORPORATION
IN WITNESS WHEREOF, the parties have executed this Agreement.
BARHILL ACQUISITION CORPORATION
By /s/ James M. Cassidy
AQUA VIE BEVERAGE CORPORATION
By /s/ Thomas Gillespie
CERTIFICATE OF INCORPORATION
OF
AQUA VIE BEVERAGE CORPORATION-H
FIRST: The name of the Corporation is Aqua Vie Beverage
Corporation-H, (the "Corporation").
SECOND: The registered office of the Corporation in the State
of Delaware is located at 1013 Centre Road, City of Wilmington,
County of New Castle. The name and address of its registered
agent is CSC, 1013 Centre Road, City of Wilmington, County of
New Castle, Delaware 19805.
THIRD: The nature of the business, objects and purposes to be
transacted, promoted or carried on by the Corporation are:
To manufacture, purchase or otherwise acquire, invest in,
mortgage,
Pledge, sell, assign and transfer or otherwise dispose of,
trade, deal in and with goods, wares and merchandise and personal
property of every class description;
To acquire, and pay for in cash, stock or bonds of
this Corporation or
otherwise, the goodwill, rights, assets and
property, and to undertake or assume the
whole or any part of the obligations or
liabilities of any person, partnership, trust,
joint stock company, syndicate, firm,
association or corporation;
To acquire, hold use, sell, assign, lease, and grant
licenses in respect of, mortgage or otherwise dispose of letters
patent of the United States or any
foreign country, patent rights, licenses and
privileges, inventions, improvements and processes, copyrights,
trademark and trade names relating to or useful in connection with any
business of the Corporation;
To acquire by purchase, subscription or otherwise,
and to receive, hold, own, sell, assign, exchange, transfer, mortgage,
pledge or otherwise dispose of or deal in and with any of the shares of
the capital stock, or any voting trust
Certificates in respect of the shares of capital
stock, scrip, warrants, rights,
Bonds, debentures, notes, trust receipts and
other securities, obligations,
Chooses in action and evidences of indebtedness
or interest issued or created
by any corporations, joint stock companies,
syndicates, associations, firms,
trust or person, public or private, or by the
government of the United States of
America, or by any foreign government, or by any
state, territory, province,
municipality or other political subdivision or
by any governmental agency,
and as owner thereof to possess and exercise
all the rights, powers, and
privileges of ownership, including the right to
execute consents and vote
thereon, and to do any and all acts and things
necessary or advisable for the
preservation, protection, improvement and
enhancement in value thereof;
To borrow or raise money for any of the purposes of
the Corporation and, from time to time without limit
as to amount, to draw, make, accept, endorse,
execute and issue promissory notes, drafts, bills of
exchange, warrants, bonds, debentures, and other
negotiable or nonnegotiable instruments and
evidences of indebtedness, and to secure the payment
of any thereof and of the interest thereon by
mortgage upon or pledge, conveyance or assignment in
trust of the whole or any part of the property of
the Corporation, whether at the time owned or
thereafter acquired, and to sell, pledge, or
otherwise dispose of such bonds or other obligations
of the Corporation for its corporate purposes;
To purchase, receive, take by grant, gift, devise,
bequest or otherwise lease, or otherwise acquire,
own, hold, improve, employ, use and otherwise deal
in and with, real or personal property, or any
interest therein, wherever situated, and to sell,
convey, lease, exchange, transfer or otherwise
dispose of, or mortgage or pledge, all or any of the
Corporation's property and assets, or any interest
therein, wherever situated; and
To engage in any lawful act or activity for which
corporations may be organized under the existing
laws of the state of Delaware.
The business and purposes specified in the
foregoing clauses shall, except where otherwise
expressed, be in nowise limited or restricted by
reference to, or inference from, the terms of any
other clause in this Certificate of Incorporation,
but the business and purposes specified in each of
the foregoing clauses of this article shall be
regarded as independent business and purposes.
FOURTH: The total number of shares of all classes
of stock which the Corporation shall have authority
to issue shall be 51,000,000 shares, of which
1,000,000 shares will be preferred stock of the par
value of one tenth of a cent each ($.001)
(hereinafter called the "Preferred Stock") and of
which 50,000,000 shares shall be common stock of the
par value of one tenth of a cent each ($.001)
(hereinafter called the "Common Stock").
The following is a statement of the powers,
preferences and rights and the qualifications,
limitations and restrictions, of classes of stock of
the Corporation, and the authority with respect
thereto expressly vested in the Board of Directors
of the Corporation.
Serial Preferred Stock
(1) Shares of Serial Preferred Stock may be
issued from time to time in one or more series,
each such series to have distinctive serial
designations, as shall hereafter be determined
in the resolution or resolutions providing for
the issue of such Serial Preferred Stock from
time to time adopted by the Board of Directors
pursuant to authority so to do which is hereby
vested in the Board of Directors.
(2) Each series of Serial Preferred Stock
a. May have such number of shares;
b. May have such voting powers, full
or limited, or may be without voting powers;
c. May be subject to redemption at
such time or times and at such prices;
d. May be entitled to receive
dividends (which may be cumulative or non
cumulative ), at such rate or rates, on
such conditions, from such date or dates,
and at such times, and payable in preference
to, or in relation to, the dividends payable
on any other class or classes or series of
stock;
e. May have such rights upon the
dissolution of, or upon any distribution of
the assets of, the Corporation;
f. May be made convertible into, or
exchangeable for, shares of any other class
or classes of any other series of the same
or any other class or classes of stock of
the Corporation at such price or prices or
at such rates of exchange, and with such
adjustments;
g. May be entitled to the benefit of
a sinking fund or purchase fund to be
applied to the purchase or redemption of
shares of such series in such amount or
amounts;
h. May be entitled to the benefits
of such conditions and restrictions upon the
creation of indebtedness of the Corporation
or any subsidiary, upon the issuance of any
additional stock (including additional
shares of such series or any other series)
and upon the payment of dividends or the
making of other distributions on and the
purchase redemption or other acquisition by
the Corporation or any subsidiary of any
outstanding stock of the Corporation; and
i. May have such other relative,
participating, optional or other special
rights, and qualifications, limitations or
restrictions thereof; all as shall be stated
in said resolution or resolutions providing
for the issuance of such Serial Preferred
Stock. Except where otherwise set forth in
the resolution or resolutions adopted by the
Board of Directors providing for the
issuance of any series of Serial Preferred
Stock, the number of shares comprising such
series may be increased or decreased (but
not below the number of shares then
outstanding) from time to time by like
action of the Board of Directors.
(3) Shares of any series of Serial
Preferred Stock which have been redeemed
(whether through the operation of a sinking
fund or otherwise) or purchased by the
Corporation, or which, if convertible or
exchangeable, have been converted into or
exchanged for shares of stock of any other
class or classes shall have the statue of
authorized and unissued shares of Serial
Preferred Stock and may be reissued as a part
of the series of which there were originally a
part or may be reclassified and reissued as
part of a new series of Serial Preferred Stock
to be created by resolution or resolutions of
the Board of Directors or as part of any other
series of Preferred Stock, all subject to the
conditions or restrictions on issuance set
forth in the resolution or resolutions adopted
by the Board of Directors providing for the
issuance of any series of Serial Preferred
Stock and to any filing required by law.
D. Common Stock
(1) Except as otherwise provided by law or by
the resolution or resolutions of the Board of
Directors providing for the issuance of any
series of the Serial Preferred Stock, the
Common Stock shall have the exclusive right to
vote for the election of Directors and for all
other purposes, each holder of the Common Stock
being entitled to one vote for each share held.
(2) Subject to all of the rights of the Serial
Preferred Stock or any series thereof, the
holders of the Common Stock shall be entitled
to receive, which, as and if declared by the
Board of Directors, out of funds legally
available therefor, dividends payable in cash,
stock or otherwise.
(3) Upon any liquidation, dissolution or
winding up of the Corporation, whether
voluntary or involuntary, and after the holders
of the Serial Preferred Stock of each series
shall have been paid in full, the amounts to
which they respectively shall be entitled, or a
sum sufficient for such payments in full shall
have been set aside, the remaining net assets
of the Corporation shall be distributed pro
rata to the holders of the Common Stock in
accordance with their respective rights and
interests, to the exclusion of the holders of
the Serial Preferred Stock.
D. General Provisions
Whenever the vote of stockholders at a meeting thereof is
required or permitted to be taken for or in connection with
any corporate action, the meeting and vote of stockholders
may be dispensed with and such action may be taken with the
written consent of stockholders having not less than the
minimum percentage of the vote required by statute for the
proposed corporate action, provided that prompt notice
shall be given to all stockholders of the taking of the
corporate action without a meeting and by less than
unanimous vote.
FIFTH: No stockholder of this Corporation shall by reason
of his holding shares of any class have any pre-emptive or
preferential right to purchase or subscribe to any shares
of any class of the Corporation, now or hereafter to be
authorized or any notes, debentures, bonds or other
securities convertible into or carrying warrants or options
to purchase shares of any class, now or hereafter to be
authorized, whether or not the issuance of any such shares
or such notes, debentures, bonds or other securities would
adversely affect the dividend or voting rights of such
stockholder other than such rights, in any, as the Board of
Directors, in its discretion, may fix; and the Board of
Directors may issue shares of any class of this
Corporation, or any note, debentures, bonds or other
securities convertible into or carrying options or warrants
to purchase shares of any class, without offering any such
shares of any class, whether in whole or in part, to the
existing stockholders of any class.
SIXTH: The name and mailing address of the incorporator is:
Name Mailing Address
Bruce A. Butcher, Esq. Suite 3827-1001 Fourth Ave. Plaza
Seattle, WA 98154
SEVENTH: The Corporation is to have perpetual existence.
EIGTH: The number of directors constituting the original
Board of Directors is one (1). The number of the directors
shall be fixed by, or in the manner provided in, the By-
Laws of the Corporation. The names and addresses of the
initial directors of the Corporation who are to serve until
the first annual meeting of the shareholders or until their
successors are elected and qualified are:
Name Mailing Address
Thomas J. Gillespie 191 Sun Valley Road.
PO Box 5569
Ketchum, Idaho 83340
NINTH: In furtherance and not in limitation of the powers
conferred by statute, the Board of Directors is expressly
authorized:
(1) To make, alter or repeal the By- Laws of
the Corporation.
(2) To authorize and cause to be executed
mortgages and liens upon the real and personal
property of the Corporation.
(3) To set apart out of any of the funds of the
Corporation available for dividends a reserve
or reserves for any purpose and to abolish any
such reserve in the manner in which it was
created.
(4) By a majority of the whole Board of
Directors, to designate one or more committees
to consist of two or more of the directors of
the Corporation. The Board of Directors may
designate one or more directors as alternate
members of any committee, who may replace any
absent or disqualified member at any meeting of
the committee. Any such committee, to the
extent provided in the resolution or in the by-
laws of the corporation, shall have and may
exercise the powers of the Board of Directors
in the management of the business and affairs
of the Corporation and may authorize the seal
of the Corporation to be affixed to all papers
which may require it; provided, however, the
by- laws may provide that in the absence or
disqualification of any member of such
committee or committees the member or members
thereof present at any meeting and not
disqualified from voting, whether or not he or
they constitute a quorum, may unanimously
appoint another member of the Board of
Directors to act at the meeting in the place of
any such absent or disqualified member.
(5) When and as authorized by the affirmative
vote of the holders of a majority of the stock
issued and outstanding having voting power
given at a stockholder's meeting duly called
upon such notice as is required by statute, or
when authorized by the written consent of the
holders of a majority of the voting stock
issued and outstanding, to sell, lease or
exchange all or substantially all the property
and assets of the Corporation, including its
goodwill and its corporate franchises, upon
such terms and conditions and for such
consideration, which may consist in whole or in
part of money or property including securities
of any other corporation or corporations, as
the Board of Directors shall deem expedient and
for the best interests of the Corporation.
TENTH: Meetings of stockholders may be held within or
without the State of Delaware, as the by-laws may provide.
The books of the Corporation may be kept (subject to any
provision contained in the statutes) outside of the State
of Delaware at such place or places as may be designated
from time to time by the Board of Directors or in the
by-laws of the Corporation shall so provide.
ELEVENTH: A director of the Corporation shall not be
personally liable to the Corporation or its stockholders
for monetary damages for breach of fiduciary duty as a
director, except for liability (i) for any breach of the
director's duty of loyalty to the Corporation or its
stockholders, (ii) for acts of omissions not in good faith
or which involve intentional misconduct or a knowing
violation of law, (iii) under Section 174 of the Delaware
General Corporation Law, as the same exists or hereafter
may be amended, or (iv) for any transaction from which the
director derived an improper personal benefit. If the
Delaware General Corporation Law hereafter is amended to
authorize the further elimination of limitation of the
liability of directors, then the liability of a director of
the Corporation, in addition to the limitation on personal
liability provided herein, shall be limited to the fullest
extent permitted by the amended Delaware General
Corporation Law. Any repeal or modification of this
paragraph by the stockholders of the Corporation shall be
prospective only, and shall not adversely affect any
limitation on the personal liability of a director of the
Corporation existing at the time of such repeal or
modification.
The Corporation shall, to the extent permitted by Section
145 of the Delaware General Corporation Law, as amended
from time to time, indemnify and reimburse all persons whom
it may indemnify and reimburse pursuant thereto. Expenses
incurred by an officer of director in defending a civil or
criminal action, suit or proceeding shall be paid by the
Corporation in advance of the final disposition of such
action, suit or proceeding upon receipt of an undertaking
by or on behalf of such director or officer to repay such
amount if it shall ultimately be determined that he is not
entitled to be indemnified by the Corporation as authorized
in Section 145(e) of the Delaware General Corporation Law.
Notwithstanding the foregoing, the indemnification provided
for herein shall not be deemed exclusive of any other
rights to which those entitled to receive indemnification
or reimbursement hereunder may be entitled under any by-law
of this Corporation, agreement, vote of stockholders or
disinterested directors of otherwise.
TWELTH: No contract or transaction between this corporation
and any person, firm, association, or corporation and no
act of this Corporation shall, in the absence of fraud, be
invalidated or in any way affected by the fact that any of
the directors of this Corporation are pecuniarily or
otherwise interested directly or indirectly, in such
contract, transaction or act, or are related to or
interested in, as a director, stockholder, officer,
employee, member or otherwise, such person, firm,
association or corporation. Any director so interested or
related who is present at any meeting of the Board of
Directors or committee of directors at which action on any
contract, transaction or act is taken may be counted in
determining the presence of a quorum at such meeting and
may vote thereat with respect to such contract, transaction
or act with like force and effect as if he were not so
interested or related. No director so interested or
related shall, because of such interest or relationship, be
disqualified from holding his office or be liable to the
Corporation or to any stockholder or creditor thereof for
any loss incurred by this Corporation under or by reason of
such contract, transaction or act, or be accountable for
any gains or profits he may have realized therein.
THIRTEENTH: The Corporation reserves the right to amend,
alter, change or repeal any provision contained in this
Certificate of Incorporation, in the manner how or
hereafter prescribed by statute, and all rights conferred
upon stockholders herein are granted subject to this
reservation.
THE UNDERSIGNED, being the incorporator herein before
named, for the purpose of forming a corporation pursuant to
the Corporation Laws of the State of Delaware, does make
this Certificate, hereby declaring and certifying that this
is my act and deed and the facts herein stated are true and
accordingly have hereunto set my hand this 29th day of
July, 1998.
