SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
MARCH 19, 1998
Date of Report (Date of Earliest Event Reported)
2-96366-A
(Commission File Number)
TREASURE & EXHIBITS INTERNATIONAL, INC.
Florida 59-2483405
(State of Other Juris- (IRS Employer Iden-
diction of Incorporation) tification Number)
2300 Glades Road, Suite 450-West
Boca Raton, Florida 33431
(Address of Principal Executive Offices)
(561) 750-7200
(Registrant's Telephone Number)
VANDERBILT SQUARE CORP.
(Former Name or Former Address, if
Changed Since Last Report)
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ITEM 2. ACQUISITION OF DISPOSITION OF ASSETS
On March 19, 1998, the Registrant acquired certain artifacts
and displays jointly from Seahawk Deep Ocean Technology, Inc., a
Colorado corporation and Seahawk I, Ltd., a Florida Limited
Partnership with principal offices in Tampa, Florida ("Seahawk").
The Company acquired the artifacts and displays through exercise of
a purchase option contained in a prior lease agreement between
Seahawk as Lessor and the Company and Michael's Treasure Jewelry,
Inc., a closely-held Florida corporation, Co-Lessees.
On March 19, 1998, the Company entered into a purchase
agreement for exercise of the lease agreement option itself with
the consent and agreement of Michael's Treasure Jewelry, Inc. which
did not participate in the purchase. Michael's consented to the
Company's exercise of the purchase option and waived all of its
rights to purchase the certain artifacts and displays covered by
the lease agreement. The Company continues with its due diligence
efforts in connection with the Company's proposed purchase of
Michael's Treasure Jewelry, Inc. Exercise of the lease agreement
purchase option at this time by the Company alone was readily
agreed to by Michael's in the circumstances.
The artifacts and displays acquired by the Company through
exercise of the purchase option is comprised partially of inventory
and partially of permanent display items to be used at retail
locations of Michael's Treasure Jewelry, Inc. following the
Company's acquisition of that closely-held business.
The Company exercised the artifacts and displays purchase
option through payment to Seahawk of the following consideration:
a. $817,500 in cash, $135,000 of which was comprised of a
credit for lease payments previously received by Seahawk;
b. 9,500,000 shares of the Company's restricted Common Stock
issued from authorized but previously unissued Common
Stock of the Company and valued by Seahawk and the
Company by agreement at $0.17 per share or $1,615,000 in
the aggregate; and
c. Delivery by the Company to Seahawk of a secured
Promissory Note in the original principal amount of
$200,000 due without interest on August 1, 1998.
The purchase and sale transaction in which the Company
acquired the artifacts was closed on March 19, 1998 at the
principal offices of Seahawk in Tampa, Florida. The Company took
possession of the artifacts, certain of which were owned free and
clear of encumbrance by Seahawk and certain of which were
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encumbered by financing statements securing debts of Seahawk to
third persons as reflected in corresponding financing statements
filed among the public records of the State of Florida. The
Company received the encumbered items subject to the pre-existing
secured interests in question totaling debt of approximately
$200,000 in the aggregate. Under the terms of the Artifacts and
Displays Purchase Agreement, in the event that the Company fails to
pay the secured Promissory Note comprising part of the
consideration supporting the option purchase, the encumbered items
must be conveyed forthwith by the Company to the respective secured
parties. Moreover, in the event that the Company fails to pay the
secured Promissory Note when due, on or before August 1, 1998,
interest shall accrue, beginning on March 19, 1998, at the highest
rate permitted by law and continuing thereafter until the secured
Promissory Note shall be fully paid by the Company.
As further aspects of the consideration paid by the Company to
Seahawk in the transaction, the Company confirmed to Seahawk that
it intends to purchase the entire ownership interest of Michael's
International Jewelry, Inc. on or before December 31, 1998, that
the Company will register the 9,500,000 shares of the restricted
Common Stock comprising part of the consideration on or before
March 19, 1999 and that the holders of such restricted Common Stock
shall have piggy-back registration rights with regard to any
secondary public offering of securities of the Company on Form SB-2
or S-1, but not on Form S-8 or S-4.
In the interim, however, the Company has the right to re-
purchase up to 8,000,000 shares of the restricted Common Stock
comprising part of the consideration supporting the option purchase
transaction. The Company may re-purchase up to 8,000,000 of the
shares at a price of $.135 per share, if re-purchased on or before
May 3, 1998, or at a price of $.15 per share if re-purchased after
May 3, 1998, but prior to June 17, 1998, some 90 days after Closing
of the option purchase transaction. The Company's right to re-
purchase a maximum of 8,000,000 of the 9,500,000 shares issued and
delivered as a part of the consideration for the option purchase
transaction will expire as to all shares not previously re-
purchased on June 17, 1998.
Holders of the 9,500,000 shares of the Company's restricted
Common Stock issued in connection with the option purchase
transaction under the Agreement have the right to put any or all of
such stock to the Company at the rate of $.085 per share during the
twelve month period beginning March 19, 1999 and ending March 19,
2000. In the event, however, that the Company has not registered
the restricted stock comprising consideration in the option
purchase transaction on or before March 19, 1999, such shareholders
shall have the right to put all of such shares to the Company
during the twelve month period beginning March 20, 1999 to the
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Company at the rate of $.17 per share. The Company, in such event,
is obligated to re-purchase all such shares rightfully put to it
under the option purchase agreement.
Moreover, in the event that the average market bid price of
the Company's Common Stock shall be less than $.12 per share during
the first five market days following March 19, 1999, the Company is
obligated to issue additional authorized but previously unissued
restricted Common Stock to the holders of such stock in proportion
to their remaining holdings at that time such that the market value
of their remaining shares is then equivalent to the original $.17
per share mutually agreed to in the Artifacts and Displays Purchase
Agreement as the value of the stock component of the consideration
paid by the Company to acquire the artifacts. That is to say, that
in the event that the market price, the average bid price over the
first five business days of the week immediately following March
19, 1999 has declined more than 30% from the $.17 initially agreed
by the parties at Closing of the Artifacts and Displays Purchase
Agreement, the Company shall be obligated to issue to such holders
a sufficient number of new shares in respect of their holdings at
that time to render those holdings returned to their original
valuation in the option purchase transaction as a part of the
purchase price consideration paid at the outset.
In all cases, that is, additional issuances, re-purchase
rights of the Company and put rights of the Seahawk shareholders,
all prices must be adjusted with regard to any intervening forward
or reverse splits or recapitalization of the Company undertaken
prior to an initial public offering.
The funds required by the Company to close the option purchase
transaction were acquired through loans made to the Company by an
affiliate, First Capital Services, Inc., a closely-held Florida
corporation controlled by the Company's President and Director, Mr.
Larry Schwartz, specifically to enable it to exercise of the option
purchase right.
The Company intends to raise additional debt capital to
exercise its right to re-purchase 8,000,000 of the 9,500,000 shares
issued in support of the option purchase transaction. The Company
intends to undertake registration of a secondary offering of its
securities for completion prior to March 19, 1999 and, as
previously reported, the Company continues to intend to acquire all
of the ownership interest in Michael's International Treasure
Jewelry, Inc. pending completion of its current due diligence
efforts with regard to the assets, operations and financial
condition of Michael's on-going business at the date of this
report.
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SIGNATURES
Pursuant to the requirements of the Securities and Exchange
Act of 1934, the Registrant has duly caused this report to be
signed on its behalf by the undersigned hereunto duly authorized.
VANDERBILT SQUARE CORP.
Dated: March 27, 1998
BY:/s/Larry Schwartz
Larry Schwartz, President
ARTIFACTS AND DISPLAYS PURCHASE AGREEMENT
THIS AGREEMENT dated the 19th day of March, 1998 is by and
between Treasure & Exhibits International, Inc., a Florida
corporation formerly called Vanderbilt Square Corp. of 2300 Glades
Road, Suite 450-West, Boca Raton, Florida 33431 (hereinafter
referred to as "Vanderbilt", Michael's Treasure Jewelry, Inc.
("Michael's" or "Co-Lessee") and Seahawk Deep Ocean Technology,
Inc., a Colorado corporation, jointly with Seahawk I Ltd., a
Florida Limited Partnership, both of 5102 S. Westshore Boulevard,
Tampa, Florida 33611 (hereinafter collectively referred to as
"Seahawk").
WHEREAS, Seahawk as Lessor and Vanderbilt and Michael's as co-
lessees have entered into a certain Lease Agreement (the "Lease
Agreement") effective October 1, 1997 for the lease of certain
artifacts and displays (hereinafter the "Artifacts"), and
WHEREAS, the Lease Agreement includes an option for the
purchase of the Artifacts, which Vanderbilt now, with the consent
and agreement of Michael's, wishes to exercise; and
WHEREAS, in accordance with certain terms and conditions,
hereinafter specified, Seahawk is willing to sell the Artifacts to
Vanderbilt and Vanderbilt is willing to buy the Artifacts from
Seahawk with the prior consent of Michael's to the purchase and
sale transaction,
NOW THEREFORE, in consideration of the premises, which shall
be deemed an integral part of this Agreement and not as mere
recitals hereto, and in consideration of the mutual covenants,
representations, warranties and agreements contained herein, and
for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto,
intending to be legally bound hereby, agree as follows:
1. Vanderbilt shall purchase from Seahawk all of the
Artifacts and Seahawk shall sell to Vanderbilt all of the
Artifacts in a purchase and sale transaction pursuant to
the terms and provisions of this Artifacts and Displays
Purchase Agreement ("Agreement") to which Michael's has
previously, and does now, consent as Co-Lessee of the
prior Lease Agreement by and between the parties.
2. Purchase Price. The purchase price for the Artifacts
shall be:
a. $135,000, the previous receipt of which is hereby
acknowledged by Seahawk; and
b. $682,500, in cash or cash equivalent, at Closing as
hereinafter described; and
c. $1,615,000 represented by 9,500,000 shares of the
restricted Common Stock of Vanderbilt (the
"Stock"). An Irrevocable Letter of Instruction to
Vanderbilt's Transfer Agent, American Stock
Transfer & Trust Company, together with a requisite
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opinion of counsel shall be delivered by Vanderbilt
to Seahawk at the closing of the purchase and sale
transaction contemplated herein as hereinafter
described. The parties have agreed that the Stock
is valued by the parties at $.017 per share, or
$1,615,000 in the aggregate. The restricted Common
Stock of Vanderbilt shall be issued pursuant to
Seahawk's instructions as reflected in Exhibit "A"
attached hereto and made a part hereof; and
d. A secured Promissory Note executed and delivered at
closing by Vanderbilt in the original principal
amount of $200,000, and due August 1, 1998, in the
form and substance as Exhibit "B" attached hereto
and made a part hereof.
2. Closing. Closing (the "Closing") of the purchase and
sale transaction contemplated herein shall occur on the
19 day of March, 1998 (the "Closing Date") and shall take
place at: Seahawk - Tampa, Florida.
3. Title. Certain of the Artifacts are owned free and clear
of any encumbrance whatsoever by Seahawk. All of the
other items of the Artifacts are owned by Seahawk
encumbered by financing statements securing debts of
Seahawk to third persons as reflected in corresponding,
filed, Forms UCC-1, copies of which shall be delivered by
Seahawk to Vanderbilt at Closing. Vanderbilt's purchase
of the encumbered Artifact items hereunder shall be
subject to the security interests reflected in the Forms
UCC-1 copies provided by Seahawk to Vanderbilt in this
transaction. On or before August 1, 1998, upon payment
of the debt reflected by the secured Promissory Note
comprising one element of the purchase price in this
transaction (paragraph 1.d. above), Seahawk shall deliver
in exchange for such payment, releases by the secured
parties of all of the collateral interests they have in
the certain encumbered Artifact items. Those releases
shall be corresponding Forms UCC-3 executed by the
secured parties and in recordable form at the time of
delivery. In the event that Seahawk is unable to deliver
the requisite Forms UCC-3, Vanderbilt's obligation as
reflected in the secured Promissory Note comprising one
element of the purchase price for the Artifacts in the
transaction contemplated herein shall be suspended and
Vanderbilt shall subsequently be obligated only to
satisfy the secured Promissory Note in exchange for all
of the Forms UCC-3 needed to render the encumbered items
of the Artifacts free and clear in the hands of
Vanderbilt. In the event that Vanderbilt fails to pay
and satisfy the secured Promissory Note timely in
exchange for all of such Forms UCC-3, title to the
encumbered items of the Artifacts shall immediately upon
such failure, at the close of business on August 1, 1998,
forthwith, without notice, process or order of any kind,
pass from Vanderbilt and revest in Seahawk; and interest
will accrue from March 16, 1998 on the outstanding,
unpaid principal balance of the secured Promissory Note
at the highest rate permitted by law, beginning on August
2, 1998 and continuing thereafter until fully paid.
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4. Acknowledgment of Encumbrance of Artifacts. At Closing,
Vanderbilt shall acknowledge in writing in the form attached
hereto and made a part hereof as Exhibit "D", "E" and "F", the
security rights and collateral interests of the corresponding
third person secured parties in the encumbered items of the
Artifacts.
5. Subsequent Purchase. At Closing, Vanderbilt shall also
provide Seahawk with written confirmation that Vanderbilt
intends to purchase the entire ownership interest of
Michael's International Jewelry, Inc. on or before
December 31, 1998.
6. Stock Registration. Vanderbilt shall register the Stock
within one (1) year of the Closing Date. In the event
that Vanderbilt shall file a registration statement with
the U.S. Securities & Exchange Commission and the
National Association of Securities Dealers, Inc. on Form
SB-2 or S-1, but not on Form S-8 or S-4, holders of the
Stock after Closing shall also have so-called "piggy-
back" registration rights of the Stock with regard to any
such filing.
7. Right to Re-Purchase Stock. Vanderbilt shall have the
right at any time within ninety (90) days after the
Closing Date, but not later than June 10, 1998, to
repurchase up to 8,000,000 shares of the Stock as
follows:
a. In minimum amounts of 1,000,000 shares;
b. At a price of $0.135 per share if re-purchased
within forty-five (45) days of the Closing Date, or
at a price of $0.15 per share if re-purchased
within ninety (90) days but later than forty-five
(45) days after the Closing Date.
This right to re-purchase the maximum of 8,000,000 shares
of the Stock shall expire as to shares not re-purchased
hereunder ninety (90) days after the Closing Date. All
prices and calculations of this paragraph 7. Shall be
adjusted for any forward or reverse split occurring prior
to the applicable re-purchase date.
8. Right to Put Stock. Vanderbilt shall grant all of the
holders of the Stock during the twelve (12) month period
beginning one (1) year after the Closing Date, the right
to put all or any shares of the Stock to Vanderbilt at
$0.085 per share. In the event that the Stock, moreover,
is not registered by Vanderbilt, at its sole expense,
within one (1) year of the Closing Date, holders of the
Stock shall have the right to put the Stock at the option
of the holders of the Stock, during the twelve (12) month
period beginning one (1) year after the Closing Date, to
Vanderbilt at the rate of $0.17 per share. Vanderbilt
shall repurchase all shares of the Stock put to it
pursuant to the provisions of this paragraph 8. All
prices and calculations of this paragraph 8. shall be
adjusted for any forward or reverse split occurring prior
to the date of any put to Vanderbilt hereunder.
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9. Right to Additional Restricted Common Stock. Moreover,
if the average market bid price of Vanderbilt's Common
Stock is less than $0.12 per share during the first five
market days following the first anniversary of the
Closing Date, Vanderbilt shall issue additional
restricted Common Stock to the holders of the Stock in
proportion to their remaining holdings at that time of
the Stock such that the market value of their remaining
shares of the Stock is equivalent to the original $0.17
per share set out by the parties as the valuation of that
part of the consideration supporting the purchase and
sale transaction contemplated herein. That is to say, in
the event that the market price, the average bid price
over the first five (5) business days of the week
immediately preceding the anniversary of the Closing
Date, has declined more than thirty (30%) percent, a
sufficient number of new shares shall be issued to the
holders in respect of their holdings at that time of the
Stock, to render them returned to the original valuation
of their remaining shares of the Stock issued and
transferred hereunder as a material part of the purchase
price consideration supporting the purchase and sale
transaction contemplated herein. All prices and
calculations of this paragraph 9. shall be adjusted for
any forward or reverse split occurring prior to the date
of any put to Vanderbilt hereunder.
10. Terms and Conditions. Other than where specified in this
agreement, all terms and conditions of the Lease
Agreement of October 1, 1997, and incorporated by
reference herein, shall remain in full force and effect.
AS TO SEAHAWK:
SEAHAWK DEEP OCEAN TECHNOLOGY,
INC., a Colorado corporation,
jointly with SEAHAWK I LTD., a
Florida Limited Partnership
(SEAL)
BY:/s/John T. Lawrence
John T. Lawrence, President,
General Partner
AS TO VANDERBILT:
TREASURE & EXHIBITS
INTERNATIONAL, INC., a Florida
corporation, f/k/a VANDERBILT
SQUARE CORP.
(SEAL)
BY:/s/Larry Schwartz
Larry Schwartz, President
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