SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
8-KSB
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
December 23, 1996
(Date of Report)
America's Coffee Cup, Inc.
(Exact name of registrant as specified in its charter)
Colorado
(State or other jurisdiction of incorporation)
33-20492-D 84-1078201
(Commission File Number) (IRS Employer Identification Number)
12528 Kirkham Court, Nos. 6&7, Poway, California 92064
(Address of principal executive offices including zip code)
(619) 679-3290
(Registrant's telephone number including area code)
<PAGE>
Item 1. Change in Control of Registrant.
Not Applicable.
Item 2. Acquisition or Disposition of Assets.
On December 20, 1996, the registrant hereunder, America's Coffee
Cup, Inc., a Colorado corporation ("ACC"), entered into a Letter of
Agreement to Purchase (the "Purchase Agreement"),with Club Rouge,
Inc., a Nevada corporation ("Club Rouge"), and it shareholders (the
"Club Rouge Shareholders"). If and when consummated (the "Closing
Date"), ACC will acquire from the Club Rouge Shareholders all of
the issued and outstanding proprietary interest of Club Rouge
solely in exchange for voting stock of ACC (the "ACC Voting
Stock"), which will result in Club Rouge becoming a wholly-owned
subsidiary of ACC and will further result in ACC issuing shares of
ACC Voting Stock which will upon issuance and subsequent
conversion, if applicable, result in the Club Rouge Shareholders
holding 15,000,000 common shares of ACC (the "ACC Common Stock").
The ACC Voting Stock to be issued to the Club Rouge Shareholders,
as well as the ACC Common Stock into which such shares are
convertible, if applicable, will be restricted under the Securities
Act of 1933, as amended (the "Securities Act"), as well as Rule 144
thereunder ("Rule 144"), and will be further restricted from
transfer under the terms of the Agreement for a period of four
years after the Closing Date. The ACC Voting Stock which the Club
Rouge Shareholders receive under the Agreement, as well as the ACC
Common Stock into which such shares are convertible, if applicable,
or both, are subject to "piggy-back" registration rights in the
event that ACC elects to register ACC Common Stock, either on
behalf of itself or a shareholder of ACC, with the Securities and
Exchange Commission (the "SEC") under the Securities Act. If the
Club Rouge Shareholders elect to piggy-back their shares and
register them with the SEC under the Securities Act after notice
from ACC, the foregoing transfer restrictions will earlier lapse.
The Agreement provides on the Closing Date that the two current
directors of ACC may remain and that they will appoint a slate of
three additional directors to be nominated by the person
controlling Club Rouge, Mr. James Walker. It is anticipated that
Messrs. Marsik and Pierce will remain as directors of ACC following
the Closing Date, Mr. Tompkins already having resigned. The
Agreement further provides on the Closing Date that all current
officers of ACC will resign and the newly constituted board will
appoint new officers, with Mr. Walker to be an officer and Mr.
Marsik also to serve as an officer and operate the coffee division.
The Agreement also requires the modification on or prior to the
Closing Date of all existing employment agreements to comply with
the foregoing requirements and be approved by the newly constituted
board of directors.
The Agreement further provides that the funding, if any, which may
be received from the exercise of all currently outstanding options
and warrants, including the bridge loan warrants issued in
anticipation of, as well as the warrants issued in connection with,
the recently concluding public offering by ACC, will be split as
follows: (i) the first $705,000 - $250,000 to ACC and $455,000 to
Club Rouge; and (ii) all additional funding 1/3rd to ACC and 2/3rds
to Club Rouge.
The Closing Date will occur as soon as the parties are legally able
to deliver the consideration expressed in the Agreement and
discussed above.
Club Rouge operates a casino in Las Vegas, Nevada. The purchase
price and number of shares of ACC Voting Stock to be issued for the
proprietary interest of Club Rouge was determined by mutual
agreement of the boards of ACC and Club Rouge after an evaluation
of the net worth of ACC as compared to the net worth of Club Rouge,
an evaluation of the future potential of the business of each
corporation, an evaluation of the current business operations of
the respective parties and their management and the share price of
the ACC Common Stock. Previous to the execution and delivery of
the Agreement, there was no material relationship between ACC and
Club Rouge, or any of their respective officers, directors,
shareholders or other affiliates.
Item 3. Bankruptcy or Receivership.
Not Applicable.
Item 4. Changes in Registrant's Certifying Accountant.
Not Applicable.
Item. 5. Other Events.
On Friday, February 7, 1997, or as soon thereafter as reasonably
practicable, ACC will hold a special meeting of its shareholders,
common and preferred, in the corporate offices of ACC in Poway,
California. The special meeting has been called for the primary
purpose of increasing the authorized common shares of ACC from
10,000,000 to 50,000,000 to allow for the conversion, if
applicable, of the ACC Voting Stock. The meeting is also being
called to change the name of ACC to a name which in the discretion
of the board governing ACC is more appropriate to the entity
following the Closing Date. These resolutions require the approval
of a majority of the votes entitled to be cast at the meeting.
Concurrent with the execution and delivery of the Agreement, ACC
notified Beverage International Group, Inc. ("BIG"), of the
termination by ACC of the letter of intent which ACC and BIG had
executed and delivered earlier this month, all in accordance with
the terms and conditions of the letter of intent.
Item 6. Resignation of Registrant's Directors.
Not Applicable.
Item 7. Financial Statements, Pro Forma Financial Information and
Exhibits.
Not Applicable.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, as amended, Registrant has duly caused this report to be
signed on its behalf by the undersigned hereunto duly authorized
this 23rd day of December, 1996.
AMERICA'S COFFEE CUP, INC.
(Registrant)
By: /s/ Robert Marsik
Robert Marsik, President
* * * * * * * * *<PAGE>
EXHIBIT A<PAGE>
LETTER OF AGREEMENT TO PURCHASE
This Letter of Agreement to Purchase entered into in Las Vegas, NV
this 20th day of December, 1996, between America's Coffee cup, Inc.
a Colorado (public corporation, sometimes referred to in this
Agreement as the "Purchaser," and The Shareholders of Club Rouge,
Inc., a Nevada Company sometimes referred to in this Agreement as
"The Shareholders" and listed, on the signature page hereto by
name, and Club Rouge, Inc. sometimes referred to in this Agreement
as the "Acquired Corporation."
The Purchaser will acquire from the Shareholders
100%(1,700)shares of the issued and outstanding shares of capital
stock of the Acquired Corporation, in exchange solely for shares of
voting stock of the Purchaser. Under this Plan, the Acquired
Corporation will become a subsidiary of America's Coffee Cup, Inc..
ARTICLE I
EXCHANGE OF CAPITAL STOCK
Transfer of Acquired Corporation's Capital Stock
1.01 Subject to the items and conditions of this Agreement,
each shareholder of Acquired Corporation will transfer and deliver
to the Purchaser on the Closing Date 100% of their certificates for
shares of Capital Stock of Club Rouge, Inc., duly endorsed, in
blank with signatures guaranteed by a Registered Stock Broker or
Bank.
Consideration for Transfer
1.02 In exchange for each share transferred by the
Shareholders pursuant to Paragraph 1.01 the Purchaser will issue
and cause to be delivered to the Shareholders on the Closing Date,
shares of Common Stock of ACC that will equal Fifteen Million
(15,000,000) shares, said shares to be restricted for a period of
four years unless sooner removed by a registration.
ACC agrees that it will cause all but two current directors to
resign and will appoint a slate of (three) directors nominated by
James Walker and ACC will also cause all officers to resign and new
Board will appoint new Officers of the Company. ACC will also
require that James Walker sit on the Board of Directors of ACC and
additionally serve as officer of the company, in addition the
Company and James Walker will require that Robert Marsik serve as
an officer and director and operate the coffee division.
1.04 It is agreed by the parties hereto that of the funding
which is available through the exercise of Options and Warrants
that any and all funding which comes into the acquiring company
through the exercise of the options and warrants will be split
among the Purchaser and the Acquired Corporation as follows:
1. The first $705,000 will be split $250,000 to the
Purchaser for use in its existing business and $455,000 to Club
Rouge, Inc. to be used in the Casino Hotel Business;
2. All additional funding shall be split 2/3 to Club Rouge,
Inc. and the balance to be used in the existing business of ACC.
1.05 As additional consideration ACC shall cause all existing
contracts to be modified and, such modification shall meet with the
new Board of Directors approval.
Closing Date
1.05 Subject to the conditions precedent set forth in this
Agreement and the other obligations of the parties set forth in the
Agreement of Purchase shall be consummated in a Definitive
Agreement at 900 West Bonanza Rd. Las Vegas NV, on or before
__________, 1996, at 10:00 o'clock A.M.
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF
ACQUIRED CORPORATION
Organization and Standing of Acquired Corporation
2.01 Club Rouge, is a corporation duly organized, validly
existing and in good standings tender the laws of Nevada, with
corporate power to own property and carry on its business as it is
now being conducted. Copies of the articles of incorporation of
Club Rouge, Inc., that have been certified by the Secretary of The
Company and delivered to the Purchaser, are complete and accurate
as of the date of this Agreement. Club Rouge, Inc., is qualified
to transact business as a foreign corporation and is in good
standing in all in all jurisdiction sin which its principal
properties are located or is not required to be qualified as a
foreign corporation to transact business in any other jurisdiction.
Subsidiaries
2.02 Club Rouge, Inc., has subsidiaries as listed on Exhibit
"A", attached hereto ad made a part hereof for all purposes.
Capitalization
2.03 Club Rouge, Inc. has an authorized capitalization of
2,500 shares and as of the date of this Agreement 1,700 shares are
issued and outstanding, fully paid, and nonassessable. There are
no outstanding subscriptions, options, contracts, commitments, or
demand relating to the authorized, but unissued stock of Club
Rouge, Inc. or other agreements of any character under which Club
Rouge, Inc. would be obligated to issue or purchase shares of its
capital stock.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF PURCHASER
Organization and Standing of Purchaser
3.01 America's Coffee Cup, Inc. is a corporation duly
organized, validly existing, and in good standing under the laws of
the State of Colorado, with corporate power to own property and
carry on its business as it is now being conducted. Copies of the
articles of incorporation of Americas Coffee Cup, Inc., that have
been certified by the Secretary of State of Colorado and will be
delivered to the Acquired Corporation, are complete and accurate as
of the date of this Agreement. America's Coffee Cup, Inc. is
qualified as a foreign corporation to transact business in other
jurisdictions.
Subsidiaries
3.02 America's Coffee Cup, Inc. has no subsidiaries.
Capitalization
3.03 ACC will have an authorized capitalization of 10,000,000
shares of common stock of the par value of $0.40 per share, of
which 845,427 shares will be issued, outstanding and fully paid as
of the closing date. There will be outstanding options, and
Warrants as set out in Exhibit "A" attached hereto relating to the
authorized but unissued stock of ACC. ACC will increase its
authorized Common Stock from 10,000,000 to 50,000,000 shares prior
to closing. The Company's current 1,000,000 of authorized
Preferred Stock shall remain the same.
Full Disclosure
3.04 As of the Closing Date, America's Coffee Cup, Inc. will
hove disclosed to the Acquired Corporation all events, conditions,
and facts materially affecting the business and prospects of ACC
has not withheld knowledge of any events, conditions, or reasonable
grounds to know which would materially affect the business and
prospects of ACC. None of the representations and warranties made
by ACC in this Agreement or set forth in any other instrument
furnished to the Acquired Corporation contain any untrue statement
of a material fact, or fails to state a material fact.
ARTICLE IV
SURVIVAL OF WARRANTIES AND LIABILITIES
Nature and Survival of Representations and Warranties
4.01 All statements of fact contained in this Agreement, or in
any memorandum, certificate, letter, document, or other instrument
delivered by or on behalf of Club Rouge, Inc. and America's Coffee
Cup, Inc. pursuant to this agreement shall be deemed
representations and warranties made by any such party,
respectively, to each other party under this agreement. The
covenants, representations, and warranties of the parties and the
shareholders shall survive the Closing Date, and all inspections,
examinations, or audits on behalf of the parties and the
shareholder for a period of one (1) year following the Closing
Date.
Indemnification
Expenses
4.02 The Acquired, Corporation shall pay its own expenses
incurred by them arising out of this Agreement and the transitions
contemplated in this Agreement, including but not limited to all
fees and expenses of their counsel and accountants. Whether or not
this Agreement is terminated, each of the parties shall bear all
expenses incurred by it in connection with this Agreement and in
the consummation of the transactions contemplated by and in
preparation for the Agreement.
Minority Shareholders
4.03 All shareholders of the Acquired Corporation shall have no
liability under this Agreement for any breach of the
representations or warranties made by Club Rouge, Inc. under this
Agreement.
ARTICLES V
COMPLIANCE WITH SECURITIES LAWS
Unregistered Stock Under Federal Securities Act
5-01 (a) Each shareholder of the Acquired Corporation
acknowledges that the shares of the Purchaser's Stock to be
delivered to the Shareholder pursuant to this Agreement have not
been registered under the Federal Securities Act of 1934, as
amended, referred to in this Agreement as the "1934 Act," that
therefore the stock is not fully transferable except as permitted
under various exemptions contained in the 1934 Act and the rules of
the Securities and Exchange Commission interpreting the Act. The
provisions contained in the Paragraph 9.01 are intended to ensure
compliance with the 1933 Act.
No Distribution of Stock to Public
(b) Each Shareholder of the Acquired Corporation represents
and warrants to the Purchaser that the shareholder is requiring the
shares of the Purchaser's Common Stock under this Agreement for the
shareholder's own account for investment, and not for the purpose
of resale to any other distribution of the shares. Each
shareholder also represents and warrants that the shareholder has
no present Agreement of disposing of all or any part of such shares
at any particular time, for any particular price, or on the
happening of any particular circumstances. Each shareholder
acknowledges that the Purchaser is relying on the truth and
accuracy of the warranties and representations set forth in this
Paragraph in issuing shares without first registering the shares
under the 1934 Act.
No Transfers in Violation of the 1934 Act
(c) Each shareholder of the Acquired Corporation covenants and
represents that none of the shares of America's Coffee Cup, Inc.
Capital Stock that will be issued to the shareholder pursuant to
this Agreement, will be offered, sold, assigned, pledged,
transferred, or otherwise disposed of except after full compliance
with all of the applicable provisions of the 1934 Act and the rules
and regulations of the Securities and Exchange Commission under the
1934 Act. Therefore, each shareholder agrees not to sell or
otherwise dispose of any of the shares of the Purchaser's Common
Stock received pursuant to this Agreement unless the shareholder:
(i) Has delivered to the Purchaser a written legal opinion in
form and substance satisfactory to counsel for the Purchaser to the
effect that the disposition is permissible under the terms of the
1934 Act and regulations interpreting the Act;
(ii) Has complied with the registration and prospectus
requirements of 1934 Act relating to such a disposition; or
(iii) Has presented the Purchaser satisfactory evidence that
such a disposition is exempt from registration under Section 4(l)
of the Act.
Purchaser shall place a stop transfer order against transfer
of the shares until one of the conditions set forth in this
subparagraph has been met.
Investment Legend on Certificate
(d) Each shareholder of the Acquired Corporation agrees that
the certificates evidencing the shares the shareholder will receive
under this Agreement will contain the following legend:
THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1934 AND HAVE
BEEN TAKEN FOR INVESTMENT. THE SECURITIES MAY NOT BE
SOLD OR OFFERED FOR SALE UNLESS A REGISTRATION STATEMENT
UNDER THE FEDERAL SECURITIES ACT OF 1934, AS AMENDED, IS
IN EFFECT FOR THE SECURITIES, OR ANY EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF SUCH ACT IS IN FACT
APPLICABLE TO SUCH OFFER OR SALE.
Indemnification by Shareholders
(e) If at any time in the future any of the shareholders of
the Acquired Corporation in sell or otherwise dispose of any of
such shares of Common Stock received from the purchaser without
registration under the 1934 Act or any similar federal statute that
may then be in effect, such shareholder agrees to indemnify and
hold harmless the Purchaser against any claim, liabilities,
penalties, costs, and expenses it may be asserted against or
suffered by the Purchaser a result of the such disposition.
Future Registration
If within three (3) years after the initial registration, the
Purchaser decides to file a registration statement under the 1934
Act, covering a sale by the Purchaser or shareholder of the
Purchaser of shares of the Purchaser's Common Stock for cash, the
Purchaser will mail to each shareholder written notice of its
Agreement to file such a registration statement. If a shareholder
delivers a written request to the Purchaser within twenty (20) days
after the mailing of such notice setting forth the number of shares
of Common Stock the shareholder intends to dispose of, the
purchaser agrees to use its best efforts to include such shares of
each shareholder in the registration statement. However, the
Purchaser shall not be so obligated to register the shares if in
the opinion of the counsel for the Purchaser such shares may be
disposed of without compliance with the registration and prospectus
requirements of the 1934 Act. If, in spite of the best efforts of
the Purchaser, the inclusion of all of the shares that each
shareholder intends to sell is not acceptable to the managing
underwriter or underwriters of the offering, the Purchaser may
limit the number of shares of each shareholder to be sold to ten
percent (10%) of the total number of shares being offered in the
Registration statement. If the offering is not completed within
ninety (90) days after the effective date of the registration
statement, the Purchaser shall be entitled to deregister any unsold
portion of such shares. The manner and conduct of any such
registration, including the contents of such registration statement
and of any related underwriting or other agreements shall be
entirely in the control and discretion of the purchaser. Each
shareholder agrees to cooperate with the Purchaser in the
preparation and filing of any registration statement prepared and
filed under this Subparagraph. The Purchaser's out-of-pocket
expenses except for registration fees incurred in performing the
obligations under this Subparagraph except that each shareholder
shall make the customary agreements, representations, warranties,
and indemnifications to the underwriters in any such offering with
respect to any shares included in the shareholders request.
Securities Act
5.02 It is agreed that the consummation of this Agreement is
not subject to issuance by the Delaware Securities Commissioner of
any permit and any other requirements of Delaware law applying to
the issuance and transfer of the Purchaser's stock in exchange for
shares of Capital Stock of Club Rouge, Inc.
ARTICLE XI
MISCELLANEOUS
Amendment
6.01 This Agreement may be amended or modified at any time
and in any manner only by an instrument in writing executed by the
President of Club Rouge, Inc. and the President of America's Coffee
Cup, Inc. provided it has been approved by the Shareholders of each
party.
Waiver
6.02 Either Club Rouge, Inc. or America's Coffee Cup, Inc. may
waive, in writing:
Extension of Time
(a) Extend the time for the performance of any of the
obligations of any other party to the Agreement.
Waiving Accuracies
(b) Waive any inaccuracies and misrepresentations contained in
this Agreement or any document delivered pursuant to the Agreement
made by any other party to the Agreement.
Waiving Compliance With Covenants
Waive compliance with any of the covenants or performance of
any obligations contained in this Agreement by any other party to
the Agreement.
Waiving Satisfaction of Condition Precedent
(d) Waive the fulfillment of any condition precedent to the
performance by any other party to the Agreement.
Assignment
6.03 (a) Neither this entire Agreement nor any right created by the
Agreement shall be assignable by either the Club Rouge, Inc. or
America's Coffee Cup, Inc. without the prior written consent of the
other, except by the laws of succession.
(b) Except as dated by the provisions of subparagraph (a),
this Agreement shall be binding on and inure to the benefit of the
respective successors and assigns of the parties, as well as the
parties.
(c) Nothing in this Agreement, expressed or implied, is
intended to confer upon any person, other than the parties and
their successors, any rights or remedies under this Agreement.
Notices
6.04. Any notice or other communication required or permitted
by this Agreement must be in writing and shall be deemed to be
properly given when delivered in person to an officer of the other
party, when deposited in the United States mails for transmittal by
certified or registered mail, postage prepaid, or when deposited
with a public telegraph company for transmittal, charges prepaid,
provided that the communication is addressed:
(a) In the case of Club Rouge, Inc., to:
Club Rouge, Inc.
900 West Bonanza Rd.
Las Vegas, Nevada 89106
or to such other person or address designated by Club Rouge, Inc.
to receive notice.
(b) In the case of America's Coffee Cup, Inc., to:
America's Coffee Cup, Inc., 12528 Kirkham Ct, Suite 6
Poway, CA 92064
or to such other person or address designated by America's Coffee
Cup, Inc. to receive notice.
Headings
6.05 Paragraph and other headings in this Agreement are for
reference purposes only and shall not affect in any way the meaning
or interpretation of this Agreement.
Entire Agreement
6.06. This instrument and the exhibits to this instrument
contain the entire, and supersedes any previous, Agreements between
the parties with respect to the transaction contemplated by the
Agreement. It may be executed in any number of counterparts by the
Agreement. It is the Agreement of the Parties hereto to enter into
a Definitive Agreement setting out more clearly the transaction
hereby on or before November 25, 1996.
Executed on the 20th day of December, 1996, at Las Vegas, Nevada.
PURCHASER:
America's Coffee Cup, Inc.
By:/s/ Robert Marsik
Its:President
ACQUIRED CORPORATION:
Club Rouge, Inc.
By:/s/ James Walker
Its: President
By: /s/ James Walker
Agent for the Shareholders
<PAGE>
Tony Bottagaro
Beverage International Group, Ltd.
11210 Huron
Suite 200
Northglenn, CO 80234 December 20, 1996
Sent Via Fax
Dear Tony,
This letter is formal notification that America's Coffee Cup,
Inc. is terminating and withdrawing our offer to acquire Beverage
International group as contemplated in the Letter of Intent dated
December 10, 1996.
As you are aware, the funding anticipated in the Letter of Intent
has not occurred and ACC was unable to provide BIG with the
$165,000 which was due December 13th and we will be unable to
provide the $165,000 loan amount due today. Given the fact that no
progress has been made towards the funding, we have no reason to
believe that the funding will be provided to allow the proposed
merger to be completed and must explore other opportunities.
I regret that the merger cannot be completed and wish you success
with your Company.
Sincerely,
/s/ Robert Marsik
President
