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 of 1934
Date of Report (date of earliest event reported ) February 17, 2000
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NETCRUISE.COM, INC.
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(Exact name of registrant as specified in its charter)
New Jersey O-29188 22-2719541
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(state or other (Commission file number) (IRS Employer
jurisdiction of Identification
incorporation) Number)
2401 Morris Avenue, Union, New Jersey 07083
- -------------------------------------- -----
(address of principal executive offices) (Zip Code)
Registrant's telephone number,
including area code, (908) 801-8767
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Genisys Reservation Systems, Inc.
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(former name, changed since last report)
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Item 1: CHANGES IN CONTROL
On March 6, 2000 the Company completed a private placement of its
$.0001 par value common stock in a series of related transactions with Mr.
Joseph Perri, who is a private investor with interests in real estate,
communications technology and Internet companies. Mr. Perri purchased 9,487,500
shares of the Company's common stock for a cash purchase price of $1,897,500 and
converted $375,000 of outstanding Company debt held by him into 2,875,000 shares
of common stock. In a separate transaction, Mr. Perri purchased an additional
299,508 shares of the Company's common stock held by a third-party investor for
a cash purchase price of $74,877.
Simultaneously with the private placement transaction, the Company paid
$172,500 to third parties in full satisfaction of an additional $412,500 of its
outstanding debt obligations.
As a result of these transactions, Mr. Perri acquired a total of
12,662,008 issued and outstanding shares of the Company's common stock, or
approximately 59.8% of the 21,161,384 total shares currently issued and
outstanding, and the Company reduced its outstanding debt by $787,500.
The Company also entered into two option agreements with Mr. Perri. One
of the option agreements grants him the right to purchase an additional
4,625,000 shares of common stock for a cash purchase price of $600,000 in the
event the Company does not enter into certain agreements, presently under
discussion with another shareholder and its affiliates, relating to contract
interpretation issues and their holdings of debt and equity interests in the
Company, on or before April 15, 2000. The other option agreement grants Mr.
Perri the right to maintain his percentage interest in the issued and
outstanding common stock of the Company by purchasing additional shares for a
purchase price of $.20 per share in the event the Company sells or issues to
third parties additional shares of its common stock or other securities
convertible into its common stock.
Item 5: OTHER EVENTS
Settlement of Legal Proceedings
A former officer of the Company filed a complaint on April 17, 1997 in
the United States District Court for the District of New Jersey against the
Company, its wholly-owned subsidiary, Corporate Travel Link, Inc. ("Travel
Link"), various officers and directors of both companies and other related and
unrelated parties. Among other things, the complaint asked for the entry of a
judgment declaring that the former officer was the owner of 333,216 shares of
the Company's common stock, which had been issued to him at the inception of
Travel Link for services he was to have provided. The lawsuit also sought an
award of unspecified compensatory and punitive damages. The Company and the
other defendants filed an answer to the complaint asserting various defenses as
well as counterclaims against the plaintiff.
On February 17, 2000, the parties to the lawsuit entered a settlement
agreement and mutually released each other from all claims which they might have
had. The Company agreed to recognize the plaintiff as the owner of 293,216
shares of its common stock, and the plaintiff agreed to immediately sell 100,000
of those shares. With respect to the plaintiff's remaining 193,216 shares, the
Company agreed that if the plaintiff sells any of those remaining shares in the
public securities markets in a reasonable manner relative to the market
conditions at the time of sale and does not
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obtain a net sale price (after commission charges) of at least $2.25 per share,
the Company will pay the plaintiff the difference between the net sales price
actually received by him and the sum of $2.25 per share (the "Sale Price
Difference") within 45 days after submission to the Company of appropriate
documentation. The plaintiff also agreed that if the Company provides notice to
him of a bona fide opportunity to sell all of his remaining shares of the common
stock for not less than the net sale price of $2.25 per share and he does not
promptly accept that offer, then the Company's obligation to pay the plaintiff
the Sale Price Difference will be canceled.
As security for the Company's obligation to pay the Sale Price
Difference, the Company and Travel Link agreed that the plaintiff could file a
$434,736 first lien security interest in their assets, which will be canceled
when the Company's obligation to pay the Sale Price Difference is canceled or
concluded.
Item 7: FINANCIAL STATEMENTS AND EXHIBITS
(c) Exhibits.
10.19 Subscription Agreement dated March 1, 2000 between the Company and Joseph
Perri.
10.20 Debt Conversion Agreement dated March 1, 2000 between the Company and
Joseph Perri.
10.21 Agreement for purchase of Netcruise.com, Inc. common stock dated March 1,
2000 between Loeb Holding Corporation, as Agent, and Joseph Perri.
10.22 Anti-dilution option agreement dated March 1, 2000 between the Company and
Joseph Perri.
10.23 Contingency Agreement dated March 1, 2000 between the Company and Joseph
Perri.
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SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this Report to be signed on
its behalf by the undersigned, thereunto duly authorized.
March 15, 2000 NETCRUISE.COM, INC.
By: /s/ John H. Wasko
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John H. Wasko, Secretary, Treasurer
and Chief Financial Officer
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EXHIBIT 10.20
netcruise.com, inc.
2401 Morris Avenue
Union, NJ 07083
Tel: 908-810-8767
Fax: 908-810-8769
SUBSCRIPTION AGREEMENT
March 1, 2000
Joseph Perri
10 Whitwell Place
Staten Island, NY 10304
Dear Mr. Perri:
This letter will constitute the agreement between netcruise.com, inc.
("Netcruise" or the "Company"), a New Jersey corporation, and yourself ("you" or
the "Investor") regarding your acquisition of shares of the $.0001 par value
common stock of Netcruise.
1. Subscription. The Investor agrees to purchase from Netcruise and Netcruise
agrees to sell to the Investor 12,362,500 shares of the unissued common stock
(the "Shares") of Netcruise as described below:
(a) for a cash purchase price of $1,897,500, the Investor is purchasing a total
of 9,487,500 Shares;
(b) for a purchase price consisting of your separate agreement
to convert into Shares the Netcruise debt owed to you by reason of your advance
of $50,000 to Netcruise on February 4, 2000 (the "Investor Advance"), the
Investor is purchasing a total of 250,000 Shares; and
(c) for a purchase price consisting of your separate agreement
to convert into Shares $325,000 of outstanding Netcruise debt held by you
reflected in four (4) Netcruise 8% secured convertible promissory notes; two (2)
in the face amount of $100,000 each dated November 4, 1999 and December 6, 1999,
one (1) in the face amount of $50,000 dated January 7, 2000 and one (1) in the
face amount of $75,000 dated January 21, 2000 (collectively the "Investor
Debt"), the Investor is purchasing a total of 2,625,000 Shares.
The Investor agrees to immediately instruct his bank to make an
electronic transfer, as instructed by the Company, of $1,897,500 into the IOLA
escrow account of Scheichet & Davis, P.C., as attorneys for the Company, and
hereby tenders to the Company debt conversion agreements dated this date for the
$50,000 Investor Advance and the $325,000 of Investor Debt in full payment for
the 12,362,500 Shares being acquired hereby.
2. Representations, Warranties and Covenants of Subscriber. The Investor hereby
acknowledges, represents, warrants, covenants and agrees as follows:
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(a) the Investor has been furnished with full access to the
books, records and reports of the Company, including but not limited to all of
the Company's SEC Form 10-KSB, 10- QSB and 8-K reports and all documents filed
by the Company or any insider with the SEC, and any documents which may have
been made available upon request (collectively referred to as "additional
materials");
(b) the Investor has been given the opportunity to ask
questions of and receive answers from the Company's officers, directors and
independent accountants concerning matters pertaining to an investment in the
Company and has been given the opportunity to obtain such information necessary
to verify the accuracy of information that was otherwise provided in order for
him to evaluate the merits and risks of a purchase of Shares to the extent the
Company possesses such information or can acquire it without unreasonable effort
or expense and has not been furnished any offering literature except as
mentioned herein;
(c) the Investor has not been furnished with any oral representation in
connection with the Shares;
(d) the Investor has determined that the Shares are a suitable
investment in view of its presently anticipated financial needs and that he
could bear a loss of his investment at this time and for the foreseeable future;
(e) with the exception of his reliance on any information
provided to him by the Company as part of a due diligence examination of the
Company for purposes of reaching his decision as to whether or not to invest in
the Company, the Investor is not relying on the Company, its officers,
directors, employees, agents, investment bankers or attorneys, with respect to
individual tax and other legal or economic considerations involved in this
investment. The Investor has relied on his knowledge and experience and that of
his legal and economic advisors with regard to the tax and other legal or
economic considerations involved in this transaction. The Investor is capable of
evaluating the merits and risks of this investment;
(f) the Investor will not sell or otherwise transfer the
Shares without registration under the Securities Act of 1933 (the "Securities
Act") and appropriate state securities ("Blue Sky") laws or the availability of
appropriate exemptions therefrom and fully understands and agrees that he must
bear the economic risks of his purchase for an indefinite period of time
because, among other reasons, the Shares have not been registered under the
Securities Act or under the Blue Sky laws of any state and, therefore, cannot be
resold, pledged, assigned, hypothecated or otherwise disposed of unless they are
subsequently registered under the Securities Act and under the applicable Blue
Sky laws or pursuant to available exemptions from such registration. The
Investor also understands that neither the Company nor any other person is under
any obligation to register the Shares on his behalf or to assist him in
complying with any exemption from registration under the Securities Act or Blue
Sky laws;
(g) the Investor is a citizen and a resident of the United States and New York
State;
(h) the Investor is an "accredited investor" as defined in
Section 2(15) of the Securities Act of 1933, as amended, and Regulation D
promulgated by the United States Securities and Exchange Commission thereunder;
(i) the Shares the Investor is subscribing for will be acquired solely for the
account of the Investor for investment purposes only and are not being purchased
for any distribution,
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subdivision or fractionalization thereof; the Investor has no contract,
undertaking agreement or arrangement with any person to sell, transfer or pledge
any Shares to such person or anyone else and has no present plan to enter into
any such contract, undertaking, agreement or arrangement;
(j) the Investor has furnished the Company with information
about the Investor and such information is correct and complete as of this date.
If there should be any material change in such information, the Investor will
immediately furnish such revised or corrected information to the Company; and
(k) he has made the foregoing representations, warranties,
covenants and agreements knowing that they shall survive his purchase of Shares.
3. Representations, Warranties and Covenants of the Company. The Company hereby
acknowledges, represents, warrants, covenants and agrees as follows:
(a) The Company is a corporation duly organized, validly
existing and in good standing under the laws of the State of New Jersey and has
all requisite power and authority to own, lease and operate its properties,
carry on its business as now being conducted, enter into this Subscription
Agreement and consummate the transactions contemplated hereby. The execution and
delivery by the Company of this Agreement and the consummation of the
transactions contemplated hereby have been duly and validly authorized by all
necessary corporate action on the part of the Company and this Agreement is a
legal, valid and binding obligation of the Company enforceable against the
Company in accordance with its terms. Neither the execution and delivery by the
Company of this Agreement nor the consummation of the transactions contemplated
hereby will conflict with or result in a breach of any provision of its
Certificate of Incorporation or By-Laws or result in a material default under
any of the terms, conditions or provisions of any note, bond, mortgage,
indenture, license, agreement, judgment, court order, restraint, lien or other
instrument or obligation to which the Company is a party or by which the Company
or its assets or properties may be bound.
(b) The Company has furnished the Investor with information
about the Company and such information is correct and complete as of the date of
this Subscription Agreement. If there should be any material change in such
information, the Company will immediately furnish such revised or corrected
information to the Investor.
(c) The Company has made the foregoing representations,
warranties, covenants and agreements knowing that they shall survive the
Investor's purchase of the Shares.
4. Investor Awareness. The Investor acknowledges his complete understanding of
the following facts:
(a) No federal or state agency has passed upon the investment
quality of the Shares or made any finding or determination as to the fairness,
merits or risks of any investment in them.
(b) There are substantial risks of loss of the investment incident to the
purchase of Shares.
(c) The Shares have not been registered under the Securities
Act or any Blue Sky laws and must be held indefinitely unless they are
subsequently so registered or exemptions from such registration are available.
The Investor has no right to require that the Shares be registered under the
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Securities Act or any Blue Sky laws and the Shares cannot be sold without
registration or other compliance with the Securities Act and applicable Blue Sky
laws. In summary, the Investor understands that the Shares have not been
registered under the securities laws of any jurisdiction, that no one has any
obligation to register them and that all Shares purchased by him may not be
transferred unless they are registered, or an exemption from such registration
is otherwise available.
5. Modification. Neither this Agreement nor any provision hereof shall be
waived, modified, discharged or terminated except by an instrument in writing
signed by the party against whom any waiver, modification, discharge or
termination is sought.
6. Notices. Any notice, demand or other communication which any party
hereto may be required, or may elect, to give anyone interested hereunder shall
be sufficiently given if (a) deposited, postage prepaid, in a United States mail
letter box, registered or certified mail, return receipt requested, addressed to
such address as may be given herein, or (b) delivered personally at such
address, or (c) delivered by fax transmission to a fax number provided by such
person (who confirms receipt thereof). The addresses and fax numbers for the
delivery of notices are as follows:
If to the Company: netcruise.com, inc.
2401 Morris Avenue
Union, NJ 07083
Tel: 908-810-8767
Fax: 908-810-8769
with a copy to: William J. Davis, Esq.
Scheichet & Davis, P.C.
505 Park Avenue - 20th Floor
New York, NY 10022
Tel. (212) 688-3200
Fax: (212) 371-7634
If to the Investor: Joseph Perri
10 Whitwell Place
Staten Island, NY 10304
with a copy to: Stephen Goldman, Esq.
2013 O Street, NW
Washington, DC 20036
Tel: (202) 293-2554
Fax: (202) 293-2556
7. Counterparts. This Subscription Agreement may be executed in any number of
counterparts and each of such counterparts shall, for all purposes, constitute
one agreement binding on all the parties.
8. Binding Effect. Except as otherwise provided herein, this
Subscription Agreement shall be binding upon and inure to the benefit of the
parties and their respective heirs, executors, administrators, successors, legal
representatives and assigns. If the undersigned is more than one person, the
obligation of the undersigned shall be joint and several and the covenants,
agreements, representations, warranties and acknowledgments herein contained
shall be deemed to be made by and be binding upon each such person.
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9. Entire Agreement. This instrument, the Anti-Dilution Agreement and
the UIT Contingency Agreement between the Investor and Netcruise dated this date
contain the entire agreement of the parties and there are no representations,
warranties, covenants or other agreements, except as stated or referred to
herein and therein.
10. Benefit and Transfer or Assignment. Except as provided otherwise
herein, this Subscription Agreement is not transferable or assignable by the
undersigned without the written consent of the Company, which consent shall not
be unreasonably withheld. No such written consent shall be required for a
transfer or assignment by the Investor of his rights or interests under this
Subscription Agreement to a corporation or limited liability company in which
the Investor owns, directly or indirectly, more than 50% of the capital stock
and in which all other shareholders are accredited investors.
11. Applicable Law. This Subscription Agreement shall be governed by and
construed in accordance with the laws of the State of New York without giving
effect to that state's conflicts of laws provisions.
Investor: Company: netcruise.com, inc
/s/ Joseph Perri By: /s/ Larry E. Burk, President
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Attest:
/s/ John H. Wasko, Secretary
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EXHIBIT 10.21
netcruise.com, inc.
2401 Morris Avenue
Union, NJ 07083
Tel: 908-810-8767
Fax: 908-810-8769
DEBT CONVERSION AGREEMENT
March 1, 2000
Joseph Perri
10 Whitewell Place
Staten Island, NY 10304
Re: Conversion of Netcruise.com, Inc. Debt into Equity
Dear Mr. Perri:
This letter will serve to confirm your agreement with netcruise.com,
inc. ("Netcruise") to purchase 2,875,000 unissued shares of the $.0001 par value
common stock of Netcruise (the "Common Stock"), pursuant to the terms and
conditions of the February 25, 2000 Subscription Agreement between us dated this
date, in the following manner:
1. For a purchase price consisting of the conversion into equity of the
Netcruise debt owed to you by reason of your advance of $50,000 to Netcruise on
February 4, 2000 (the "Investor Advance"), you are purchasing a total of 250,000
shares of Common Stock; and
2. For a purchase price consisting of the conversion into equity of
$325,000 of outstanding Netcruise debt held by you reflected in four (4)
Netcruise 8% secured convertible promissory notes; two (2) in the face amount of
$100,000 each dated November 4, 1999 and December 6, 1999, one (1) in the face
amount of $50,000 dated January 7, 2000 and one (1) in the face amount of
$75,000 dated January 21, 2000 (collectively the "Investor Debt"), you are
purchasing a total of 2,625,000 shares of Common Stock.
Please confirm your agreement to the foregoing by signing
where indicated below.
Very truly yours,
ACCEPTED AND AGREED:
NETCRUISE.COM, INC.
/s/ Joseph Perri By: /s/ Lawrence E. Burk, President
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EXHIBIT 10.22
LOEB HOLDING CORPORATION
61 Broadway
New York, NY 10006
March 1, 2000
Joseph Perri
10 Whitwell Place
Staten Island, NY 10304
Re: Your purchase of Netcruise.com, inc. Common Stock
Held by Loeb Holding Corporation, as Agent
Dear Mr. Perri
This letter will serve to confirm the terms of the agreement
between you and Loeb Holding Corporation ("Loeb", a New York Corporation), as
Agent, regarding your purchase from Loeb of 299,508 shares of the $.0001 par
value common stock (the "Shares") of netcruise.com, inc. (the "Company,"
formerly known as "Genisys Reservation Systems, Inc.") for a purchase price of
$74,877, which you are paying by electronic transfer.
Loeb represents and warrants to you that Loeb holds the Shares
free and clear of any and all claims or encumbrances of every nature and that
this transaction and this letter agreement have been duly and validly authorized
by all required action on Loeb's part and is fully enforceable against Loeb in
accordance with its terms. However, Loeb is makes no representations or
warranties, whether oral or written, regarding the status, business or financing
of the Company at this time.
You represent and warrant to Loeb the following:
(a) you have a net worth of at least $1,000,000 or more;
(b) you have been furnished by others with a copy of any and
all information concerning the Company, the Shares and any other matters which
you have requested and you understand the disclosure which has been provided to
you;
(c) you have relied solely on the disclosures which has been
provided to you by others regarding the business and prospects of the Company
and are not relying on any information from Loeb with regard to the Company, its
status, business or financing;
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(d) you have been given the opportunity to ask questions of
and receive answers from the Company concerning the terms and conditions of the
Shares and its status, business and financing and you have also been given the
opportunity to obtain such information as will be necessary to verify the
accuracy of the information which has been provided to you in order for you to
be able to evaluate the merits and risks of your purchase of the Shares;
(e) you have determined that the Shares is a suitable
investment for you in view of your anticipated financial needs and that can
absorb the loss of your investment at this time and for the foreseeable future
without affecting your lifestyle;
(f) you are capable of evaluating merits and risks of this
investment and that you have relied upon your own knowledge, experience and
understanding as well as that of your own legal, tax and economic advisors with
regard to the considerations involved in this investment by you.
(g) you will not sell or otherwise transfer the Shares without
registration under applicable federal and state laws or the availability of
appropriate exemptions from such registration and that you fully understand and
agree that you must bear the economic risk of investment in the Shares for an
indefinite period of time because it has not been registered under any federal
or state securities law and therefore cannot be resold, pledged, assigned or
otherwise disposed of unless they are subsequently registered or unless there is
available an exemption from such registration;
(h) you have separately made a non-refundable equity investment in the Company
of not less than $2,000,000 in cash or conversion of outstanding debt;
(i) you are acquiring your interest in the Shares for
investment purposes only and not for any distribution, subdivision or
fractionalization and that you have no plans, or agreements or arrangements with
any person to sell, transfer, pledge or otherwise dispose of the Shares other
than to the Company; and
(j) you have made all of the foregoing representations and
warranties knowing that Loeb is relying upon them in executing this transaction
with you and that they shall survive your purchase of the Shares.
We mutually agree that this letter agreement incorporates our
entire understanding and may not be modified, waived, discharged, terminated or
amended except by a writing signed by the person against whom any such
modification, waiver, discharge or termination is being asserted.
If any notice or other communication is to be transmitted
between us, it shall be given by registered or certified mail, return receipt
requested, or delivered personally, or delivered by a confirmed fax transmission
from one to the other at the addresses set forth in this letter agreement.
This letter agreement will be binding upon and inure to the
benefit of each of us and our respective heirs, executors, administrators,
successors and assigns, it may be executed in any number of copies each of
which, shall, for all purposes, constitute that one agreement binding on each of
us, will be governed by and construed in accordance with the laws of the State
of New York and will not be transferable or assignable except upon our mutual
consent.
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If the foregoing confirms your understanding of the terms and
conditions of our agreement, please so indicate by signing the enclosed copy of
this letter agreement and returning it to Loeb immediately.
Very truly yours,
Loeb Holding Corporation, As Agent
By: /s/ Warren Bagatelle, Authorized Officer
ACCEPTED AND AGREED:
/s/ Joseph Perri
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EXHIBIT 10.22
netcruise.com, inc.
2401 Morris Avenue
Union, NJ 07083
Tel: 908-810-8767
Fax: 908-810-8769
Anti-Dilution Option Agreement
March 1, 2000
Joseph Perri
10 Whitwell Place
Staten Island, NY 10304
Dear Mr. Perri:
This letter will constitute the Agreement between netcruise.com, inc.
("Netcruise" or the "Company"), a New Jersey corporation, and yourself ("you" or
the "Investor") regarding certain "anti- dilution" rights which Netcruise has
agreed to grant to you in connection with your entering into the Subscription
Agreement, dated this date, regarding your acquisition from Netcruise of
12,362,500 shares of the $.0001 par value common stock of Netcruise (the "Common
Stock"). We each agree to incorporate herein by reference all of our respective
representations and warranties as contained in the Subscription Agreement.
1. Purpose of this Agreement. The object of this Agreement is to enable
you to maintain your percentage interest in Netcruise after the completion of
your acquisition of Common Stock as provided in both the Subscription Agreement
and in the separate agreement you have entered into, dated this date, with Loeb
Holding Corporation ("Loeb") regarding your acquisition of an additional 299,508
shares from Loeb. Your Common Stock holdings after these acquisitions will total
12,662,008 shares of Common Stock, and your percentage interest, after
accounting for the various outstanding conversion options and warrants (except
for the Class X and Class Y Common Stock Purchase Warrants to purchase an
aggregate of 1,600,000 shares of Common Stock held by United Internet
Technologies, Inc., and the Class V and Class W Common Stock Purchase Warrants
to purchase an aggregate of 400,000 shares of Common Stock held by Brian
Shuster) resulting in fully diluted shares outstanding of 22,328,064 as shown on
the attached schedule which we have mutually initialed, will total 56.71 % (the
"Percentage Interest").
2. Issuance of New Shares. Except as hereinafter provided, in the event
the Company shall at any time after the date hereof issue or sell any shares of
Common Stock ("New Shares"), including shares held in the Company's treasury,
shares of Common Stock issued upon the exercise of any options, rights or
warrants to subscribe for shares of Common Stock, and shares of Common Stock
issued upon the direct or indirect conversion or exchange of securities for
shares of Common Stock, you shall have the right to purchase at a purchase price
of $.20 per share a sufficient number of shares of Common Stock so that your
Percentage Interest after the completion of your purchase pursuant to this
Agreement, rounded to the nearest whole share, shall be undiluted.
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3. Prior Notice of Issuance of New Shares. The Company shall give
notice to you of each prospective issuance of New Shares (the "Issuance Notice")
not less than ten (10) days prior to the date that such New Shares will be
issued. That notice shall contain the number of New Shares which are to be
issued together with a computation of the number of shares which you would need
to purchase to maintain your Percentage Interest (the "Option Shares").
4. Dispute Over the Number of Option Shares. In the event you do not
agree with the Company's computation of the number of Option Shares which you
need to purchase to maintain your Percentage Interest, you shall advise the
Company of any such dispute within ten (10) days after your receipt of each such
notice. In the event of such a dispute, you and the Company shall promptly
confer to resolve the dispute within the following ten (10) days, failing which
the dispute will be submitted to arbitration as hereinafter provided. Pending
resolution of the dispute, you may exercise your rights to purchase Option
Shares based upon the Company's computation as contained in the notice, pending
resolution of the arbitration.
5. Exercise of Option. You shall exercise your rights to purchase
Option Shares pursuant to this Agreement by providing a notice to the Company of
your purchase of Option Shares, together with the number of shares you are
purchasing and payment of the purchase price, in New York Clearing House funds,
by certified or bank check or confirmed electronic transfer within 45 days of
the date you receive each Issuance Notice or within 30 days after issuance,
whichever is later. In the event a dispute is resolved by arbitration with an
award which provides that you may purchase more Option Shares than computed by
the Company, you shall exercise your right to purchase such additional Option
Shares within ten (10) days after such arbitration decision becomes final and
non- appealable.
6. Issuance Date. Shares of Common Stock shall be deemed to have been
issued immediately after the opening of business on the day following their
issuance date, except that in the case of a reclassification of other securities
of the Company into shares of Common Stock, the issuance date shall be deemed to
be the day after the record date for determining the security holders entitled
to receive such shares.
7. Definition of Common Stock. For the purpose of this Agreement, the
term "Common Stock" shall mean (i) the class of stock designated as Common Stock
in the Certificate of Incorporation of the Company as amended as of the date
hereof, or (ii) any other class of stock resulting from successive changes or
reclassifications of such Common Stock consisting solely of changes in par
value, or from par value to no par value, or from no par value to par value.
8. No SEC Registration. The Option Shares issuable hereunder have not
been registered under the Securities Act of 1933, as amended (the "Securities
Act") or any state securities ("Blue Sky") laws and must be held indefinitely
unless they are subsequently so registered or exemptions from such registration
are available. You have no right to require that the shares be registered under
the Securities Act or any Blue Sky laws and the shares cannot be sold without
registration or other compliance with the Securities Act and applicable Blue Sky
laws.
9. Arbitration. Any dispute, controversy or claim with respect to
the enforcement of the provisions of this Agreement or the performance or breach
of such provision shall be settled exclusively by arbitration conducted in New
York, New York in accordance with the Commercial Arbitration Rules of the
American Arbitration Association by a panel of three neutral arbitrators
appointed in accordance with such rules. In any such arbitration proceeding, the
arbitrators shall have the authority to order specific performance of an act by
any party to such proceeding, in addition to
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or in lieu of monetary damages. The parties to this Agreement hereby consent to
the jurisdiction of the court's of the United States or the State of New York in
New York County.
10. Modification. Neither this Agreement nor any provision hereof shall be
waived, modified, discharged or terminated except by an instrument in writing
signed by the party against whom any waiver, modification, discharge or
termination is sought.
11. Notices. Any notice, demand or other communication which any party
hereto may be required, or may elect, to give anyone interested hereunder shall
be sufficiently given if (a) deposited, postage prepaid, in a United States mail
letter box, registered or certified mail, return receipt requested, addressed to
such address as may be given herein, or (b) delivered personally at such
address, or (c) delivered by fax transmission to a fax number provided by such
person (who confirms receipt thereof). The addresses and fax numbers for the
delivery of notices are as follows:
If to the Company: netcruise.com, inc.
2401 Morris Avenue
Union, NJ 07083
Tel: 908-810-8767
Fax: 908-810-8769
with a copy to: William J. Davis, Esq.
Scheichet & Davis, P.C.
505 Park Avenue - 20th Floor
New York, NY 10022
Tel. (212) 688-3200
Fax: (212) 371-7634
If to Joseph Perri: Joseph Perri
10 Whitwell Place
Staten Island, NY 10304
Tel:
Fax:
with a copy to: Stephen Goldman, Esq.
2013 O Street, NW
Washington, DC 20036
Tel: (202) 293-2554
Fax: (202) 293-2556
12. Counterparts. This Agreement may be executed in any number of counterparts
and each of such counterparts shall, for all purposes, constitute one agreement
binding on all the parties.
13. Binding Effect. Except as otherwise provided herein, this Agreement
shall be binding upon and inure to the benefit of the parties and their
respective heirs, executors, administrators, successors, legal representatives
and assigns. If the undersigned is more than one person, the obligation of the
undersigned shall be joint and several and the covenants, agreements,
representations, warranties and acknowledgments herein contained shall be deemed
to be made by and be binding upon each such person.
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14. Entire Agreement. This Agreement contains the entire agreement of the
parties with respect to its subject matter and there are no representations,
warranties, covenants or other agreements, except as stated or referred to
herein and in the Subscription Agreement.
15. Benefit and Transfer or Assignment. Except as provided otherwise
herein, this Agreement is not transferable or assignable by the undersigned
without the written consent of the Company, which consent shall not be
unreasonably withheld. No such written consent shall be required for a transfer
or assignment by the Investor of his rights or interests under this Agreement to
a corporation or limited liability company in which the Investor owns, directly
or indirectly, more than 50% of the capital stock and in which all other
shareholders are accredited investors.
16. Applicable Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York without giving effect to that
state's conflicts of laws provisions.
Investor: Company: netcruise.com, inc
/s/ Joseph Perri By: /s/ Larry E. Burk, President
------------ ------------------------
Attest:
/s/ John H. Wasko, Secretary
17
EXHIBIT 10.23
netcruise.com, inc.
2401 Morris Avenue
Union, NJ 07083
Tel: 908-810-8767
Fax: 908-810-8769
Contingency Agreement
March 1, 2000
Joseph Perri
10 Whitwell Place
Staten Island, NY 10304
Dear Mr. Perri:
This letter will confirm the agreement between netcruise.com, inc.
("Netcruise" or the "Company"), a New Jersey corporation, and yourself ("you" or
the "Investor") regarding possible changes in the Subscription Agreement and
Anti-Dilution Option Agreement which we have executed today and which are
contingent upon the happening of events discussed below.
The contingent changes agreed-to in this Contingency Agreement (the
"Contingency Agreement") relate to pending agreements with United Internet
Technologies, Inc., a Delaware corporation ("UIT") and Brian Shuster regarding,
among other things, UIT's sale to you of 1,500,000 shares (the "Additional
Shares") of the $.0001 par value common stock ("Shares") of Netcruise for a
purchase price of $375,000, its sale to you or forgiveness of certain
outstanding Netcruise debt obligations held by UIT and its affiliates (the "UIT
Debt") for a purchase price of $225,000, cancellation of the Netcruise Class V,
W, X and Y Common Stock Purchase Warrants for an aggregate of 2,000,000 Shares
and the issuance to UIT of a Common Stock Purchase Warrant to purchase up to
500,000 Shares during a period of five years at a purchase price of $1.00 per
share (collectively referred to as the "Pending UIT Transaction").
You have agreed that you will purchase the Additional Shares and UIT
Debt for $600,000 in accordance with the draft agreements previously prepared
and provided to your attorney or, in the alternative, will purchase the
Additional Shares alone for $375,000 and provide an additional $225,000 to
Netcruise for it to obtain forgiveness of the UIT Debt. In either event,
Netcruise has agreed to issue to you an additional 1,125,000 Shares upon
satisfaction of the UIT Debt by either your purchase of it from UIT followed by
your conversion of it into Netcruise equity, or by Netcruise utilizing the
funding being provided by you to make a satisfaction payment to UIT.
We have mutually agreed that in the event the Pending UIT Transaction
does not close within 45 days after the date of this agreement, Netcruise will
issue to you an additional 4,625,000 Shares for a purchase price of $600,000
pursuant to the terms and conditions of the Subscription Agreement. If the
Pending UIT Transaction is completed thereafter, you agree surrender to
Netcruise for cancellation, as a contribution to capital, a number of Shares
equal to the difference between the Shares (including those issuable upon the
exercise of warrants) held by UIT and Brian Shuster before
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completion of the Pending UIT Transaction and the Shares (including those
issuable upon the exercise of warrants) held by them after the completion of the
Pending UIT Transaction.
In either event, we have further mutually agreed to amend the
Anti-Dilution Option Agreement to reflect the adjusted holdings of Shares by you
and the adjusted number of Shares issued and outstanding on a fully diluted
basis (as described in paragraph #1 of the Anti-Dilution Option Agreement) so as
to recompute your Percentage Interest as defined in the Anti-Dilution Option
Agreement as if your acquisition of Additional Shares pursuant to this
contingency agreement took place as of the date of the Anti-Dilution Option
Agreement. We mutually expect that your Percentage Interest upon recomputation
will total approximately 64%.
We also mutually agree to incorporate herein by reference all of our
respective representations and warranties as contained in the Subscription
Agreement, dated this date.
If the foregoing confirms your understanding of our agreement, kindly
so indicate by signing the enclosed copy of this letter and returning it to us
immediately.
Very truly yours,
netcruise.com, inc
By: /s/ Larry E. Burk, President
Attest:
/s/ John H. Wasko, Secretary
ACCEPTED AND AGREED:
/s/ Joseph Perri
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