SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-KSBA
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of
1934
April 18, 1997
(Date of Report)
Midland, Inc.
(Exact Name of Registrant as specified in its charter)
Colorado
(State or other jurisdiction of incorporation)
33-20492-D Applied For
(Commission File Number) IRS Employer Identification
Number)
10528 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)
America's Coffee Cup, Inc.
(Former name or former address, if changed since last report)
Item 1. Change in Control of Registrant.
See Item 2, below.
Item 2. Acquisition or Disposition of Assets.
On February 18, 1997 (the Closing Date), Registrant, Midland,
Inc., f/k/a, America's Coffee Cup, Inc., executed, delivered and
closed under a Plan and Agreement of Purchase (the Purchase
Agreement) with the shareholders (the Shareholders) of MILL-AGRO
(HELLAS) SA, a Panamanian company, and MEGAHEL NAUTICAL SA, a
Greek company (both of which business entities are collectively
referred to herein as the Subsidiaries), whereby Registrant
acquired from the Shareholders all of the outstanding proprietary
interest of these entities, thereby making them wholly-owned
subsidiaries of Registrant. The Subsidiaries have now changed,
or will forthwith change, their names to Midland Steamship SA and
Midland Agricultural SA
Registrant issued and caused to be delivered to the Shareholders,
immediately subsequent to the Closing Date, 74,604 shares of its
previously authorized Series A Preferred Stock (Series A
Preferred Stock) and 149,259 shares of a Series B Preferred Stock
(Series B Preferred Stock), which was created immediately after
the closing.
The Series A Preferred Stock consists of 360,000 shares, with
each share (i) to be automatically converted into 35 shares of
Common Stock on October 1, 1998, but no sooner, (ii) being
entitled to 35 votes on each matter submitted to the shareholders
of Registrant, with certain super-majority provisions being
applicable in certain instances, (iii) being entitled to a
liquidation preference of $21 per share and (iv) not being
redeemable. The Series A Preferred Stock will also be entitled
to two separate annual dividends consisting of one-tenth of one
share of Series A Preferred Stock and two warrants to purchase
common stock of Registrant (Common Stock) at a price of $1.00 per
share in the event that either certain financial performance
conditions are not met by Registrant or the Common Stock does not
trade at or above certain prices. Specifically, the first
dividend will be required to be declared and paid as of September
1, 1997, in the event that (i) Registrant's pretax earnings for
the twelve months ended June 30, 1997, do not meet or exceed
$300,000 in amount, excluding extraordinary and nonrecurring
items, or (ii) the lowest bid price for the Common Stock is less
than $2.50 per share during any ten consecutive trading days
between June 30, 1997, and August 15, 1997. A second dividend
will be required to be declared and paid as of September 1, 1998,
in the event that (i) Registrant's pretax earnings for the twelve
months ended June 30, 1998, do not meet or exceed $450,000 in
amount, excluding extraordinary and nonrecurring items, or (ii)
the lowest bid price for the Common Stock is less than $2.50 per
share for any ten consecutive trading days between August 14,
1997, and August 15, 1998. These dividends are cumulative, and
this series has certain non-dilution provisions applicable to it
in the event of stock dividends, stock splits and other
extraordinary corporate events. As a result of the purchase of
the Subsidiaries, there are now 162,100 shares of Series A
Preferred Stock outstanding.
The Series B Preferred Stock consists of 149,259 shares, with
each share (i) to be automatically converted into 150 shares of
Common Stock on October 1, 1998, or sooner at the election of the
holder, (ii) being entitled to 150 votes on each matter submitted
to the shareholders of Registrant, with certain super-majority
provisions being applicable in certain instances, (iii) not being
entitled to a liquidation preference, (iv) not being redeemable
and (v) not being entitled to dividends. This series has certain
non-dilution provisions applicable to it in the event of stock
dividends, stock splits and other extraordinary corporate events.
As a result of the purchase of the Subsidiaries, there are now
149,259 shares of Series A Preferred Stock outstanding.
Immediately following the execution, delivery and consummation of
the Purchase Agreement, the Board of Directors was expanded to
six in number and, joining Messrs. Robert W. Marsik and Mark S.
Pierce to fill the empty seats on the board were, Messrs. Chris
Traios, Charles Stidham, E. Robert Barbee and Arthur Malcolm.
All directors have been appointed to serve until the next annual
meeting of shareholders and until their successor are duly
elected and qualified, or until they earlier resign or are
dismissed. No director has any contractual rights to his
position.
The newly constituted Board of Directors then appointed (i) Mr.
Traios as Chairman of the Board of Directors and as Chief
Executive Officer and President, (ii) Mr. Marsik as Executive
Vice-President, Chief Financial Officer and Treasurer, (iii) Mr.
Stidham as Managing Director of North American Shipping and
Trading Operations, (iv) Mr. E. Robert Barbee as Vice-President
and (v) Mr. Mark S. Pierce as Secretary.
Registrant, immediately following closing, changed its name to
Midland, Inc. The Subsidiaries have now changed, or will
forthwith change, their names to Midland Steamship SA and Midland
Agricultural SA. Registrant has also formed, or will forthwith
form, two additional subsidiaries, Midland Liners SA and Midland
Shipping SA, in order to provide for the anticipated expansion of
the business of Registrant into the container and shipping
business.
The Shareholders on the Closing Date delivered a Balance Sheet of
the Subsidiaries as of December 31, 1996, which had been reported
on by Republic Of Greece, Ministry of Commerce on February 14,
1997. The Shareholders have undertaken to deliver audited
financial statements in accordance with applicable securities
laws within 75 days of the Closing Date. If the audited
statements are not delivered or do not conform with the audit of
the Ministry Of Commerce within a minus 20%, the Board of
Directors in place prior to the Closing Date will be entitled to
reverse the closing the acquisition of the Subsidiaries.
The assets of the Subsidiaries, as of December 31, 1996, and as
reported on by the Republic of Greece, Ministry of Commerce on
February 14, 1997, aggregated $3,675,163 in amount and consisted
of office, furniture and various equipment, accounts receivable,
freight advances, bank balances, and fixed assets consisting of
two hydrofoils, one hopper-barge, one motor-tanker and one motor
bulk carrier, all of which are used in the shipping business of
the Subsidiaries. The liabilities of the Subsidiaries, as of
December 31, 1996, and as reported on by the Republic of Greece,
Ministry of Commerce on February 14, 1997, aggregated $1,545,435
in amount and consisted primarily of accounts payable. The
result of the foregoing was an equity amount of $2,129,728.
As a result of the acquisition of the Subsidiaries, Registrant
now has the following outstanding securities: (i) 861,567 shares
of Common Stock outstanding in the hands of the public prior to
the acquisition of the Subsidiaries; (ii) Bridge Loan Options
which, upon exercise, will require the issuance of up to
1,809,955 shares of Common Stock and 2,585,650 warrants each
allowing the acquisition of one additional share of Common Stock;
(iii) 54,000 shares of Series A Preferred Stock issued in a
recent public offering which, upon conversion and assuming no
dividends, will require the issuance of approximately 1,890,000
shares of Common Stock, and 2,700,000 Series A warrants each
allowing the acquisition of one share of Common Stock; (iv)
compensatory options to former management which, upon exercise,
allow the acquisition of up to 33,496 shares of Series A
Preferred Stock which, upon conversion and assuming no dividends,
will require the issuance of approximately 1,172,360 shares of
Common Stock; (v) compensatory options to former management
which, upon exercise, allow the acquisition of up to 552,640
shares of Common Stock; (vi) 74,604 shares of Series A Preferred
Stock issued in the acquisition of the Subsidiaries which, upon
conversion and assuming no dividends, will require the issuance
of approximately 2,611,140 shares of Common Stock; and (vii)
149,259 shares of Series B Preferred Stock issued in the
acquisition of the Subsidiaries which, upon conversion, will
require the issuance of approximately 22,388,850 shares of Common
Stock. Registrant does not have a sufficiency authorized
capitalization to provide for the exercise and/or conversion of
all of the foregoing securities, and will, therefore, call and
hold a shareholders' meeting for the purpose of increasing its
capitalization. If all shares of Common Stock underlying the
foregoing convertible securities were issued, the total number of
shares of Common Stock would approximate 36,000,000 in number.
The Series A and B Preferred Stock, given their terms and
conditions, are considered to be a part of the same class of
securities as the Common Stock for purposes of Section 16 of the
Securities Exchange Act of 1934, as amended, and Rule 144
thereunder; thus, as of the date of this report, there were
considered to be approximately 27,751,557 shares of Common Stock
outstanding.
Item 3. Bankruptcy or Receivership.
Not Applicable.
Item 4. Changes in Registrant's Certifying Accountant.
Not Applicable.
Item 5. Other Events.
None.
Item 6. Resignation of Registrant's Directors.
Not Applicable.
Item 7. Financial Statements, Pro Forma Financial Information and
Exhibits.
America's Coffee Cup, Inc.
December 31, 1996
Pro Forma Balance Sheet & Income Statement
BALANCE SHEETS
ACC Adjustments ACC
Adjusted
Assets:
Cash & Equivalents $ - $ - $ -
Restriced Cash
(Note A) - - -
Accounts Receivable 58,424 - 58,424
Other Receivable - - -
Related Party Receivable - - -
Inventory 5,000 - 5,000
Prepaid expenses and
other 27,487 - 27,487
Total current assets 90,910 - 90,910
Other non-current
assets 172,698 - 172,698
Investment - 1,450,000 1,450,000
Property and Equipment,
net 25,795 - 25,794
289,404 1,450,000 1,739,618
Liabilities:
Current portion of
long-term debt $239,194 - 239,194
Accounts payable 586,634 - 586,634
Accrued liabilities 69,445 - 69,445
Accrued payroll
& employee expense 40,170 - 40,170
Total Current
Liabilities 935,443 - 935,443
Long-term debt 25,374 - 25,374
Shareholders' Equity:
Common stock 338,226 - 338,226
Preferred stock 21,600 (90,000) 111,600
Additional Paid-in
Capital 940,336 (611,605) 328,761
Accumulated
Earnings (Deficit) (1,971,605) 1,971,605 -
Total Shareholders'
Equity (671,413) 1,450,000 778,587
289,404 1,450,000 1,739,404
Acquired Acquired
Mega-hel Mill-Agro Total
Assets:
Cash & Equivalents - 365,390 584,826
Restriced Cash
(Note A) 219,436 1,200,000 1,200,000
Accounts Receivable - 625,900 625,900
Other Receivable - 300,000 300,000
Related Party Receivable 155,055 404,983 560,038
Inventory - - -
Prepaid expenses and
other - - -
Total current assets 374,491 2,896,273 3,270,764
Other non-current
assets - - -
Investment - - -
Property and Equipment,
net 3,330,127 28,640 3,358,767
3,704,618 2,924,913 6,629,531
Liabilities:
Current portion of
long-term debt - - -
Accounts payable
Accrued liabilities - - -
Accrued payroll - - -
& employee expense
Total Current
Liabilities - - -
Long-term debt 1,545,015 12,484 1,557,499
Shareholders' Equity:
Common stock 4,200 10,000 14,200
Preferred stock - - -
Additional Paid-in
Capital 1,900,000 - 1,900,000
Accumulated
Earnings (Deficit) 255,403 2,902,429 3,157,832
Total Shareholders'
Equity 2,159,603 2,912,429 5,072,032
3,704,618 2,924,913 6,629,531
Elimination Total Pro-Forma
Assets:
Cash & Equivalents - 584,826
Restriced Cash
(Note A) - 1,200,000
Accounts Receivable - 684,324
Other Receivable - 300,000
Related Party Receivable - 560,038
Inventory - 5,000
Prepaid expenses and
other - 27,487
Total current assets - 3,361,674
Other non-current
assets - 172,698
Investment (1,450,000) -
Property and Equipment,
net (464,200) 2,920,362
(1,914,200) 6,454,735
Liabilities:
Current portion of
long-term debt - 239,194
Accounts payable - 586,634
Accrued liabilities - 69,445
Accrued payroll - 40,170
& employee expense
Total Current
Liabilities - 935,443
Long-term debt - 1,582,873
Shareholders' Equity:
Common stock (14,200) 338,226
Preferred stock - 111,600
Additional Paid-in
Capital (1,900,000) 328,761
Accumulated
Earnings (Deficit) - 3,157,832
Total Shareholders'
Equity (1,914,200) 3,936,419
(1,914,200) 6,454,735
INCOME STATEMENT
Acquired Acquired Acquired
Mega-hel Mill-Agro Total
Revenues 1,321,275 23,169,860 24,491,135
Cost of Sales 779,258 19,708,525 20,487,783
Gross Profit 542,017 3,461,335 4,003,352
Operating Expenses:
G&A expenses 281,014 552,546 833,560
Depreciation 5,600 6,360 11,960
Total Operating
Expenses: 286,614 558,906 845,520
Other Income
(Expense):
Interest (108,151) (874) (109,025)
Finance Expense - - -
Loss on disposition
of equipment - - -
Other - - -
Total Other Expenses (108,151) (874) (109,025)
Income (Loss) from
Operations and
before Income
Taxes and
Extraordinary
Item 147,252 2,901,555 3,048,807
Income Taxes - - -
Net Income (Loss)
before
Extraordinary Item 147,252 2,901,555 3,048,807
Extraordinary Item,
net of tax (Note L) - - -
Net Income (Loss) 147,252 2,901,555 3,048,807
Net Income (Loss)
per Common Share
before
Extraordinary Item 0.01 0.26 0.14
Extraordinary Item - - -
Net Income (Loss)
per Common Share 0.01 0.26 0.14
Weighted Average Number
of Shares Outstanding 11,194,425 11,194,425 22,388,850
ACC Total Pro-Forma
Revenues 2,087,694 26,578,829
Cost of Sales 2,278,618 22,766,401
Gross Profit (190,924) 3,821,428
Operating Expenses:
G&A expenses 857,807 1,691,367
Depreciation 56,000 67,960
Total Operating
Expenses: 913,807 1,759,327
Other Income
(Expense):
Interest (78,691) (187,716)
Finance Expense - -
Loss on disposition
of equipment (305,818) (305,818)
Other 17,533 17,533
Total Other Expenses (366,976) (476,001)
Income (Loss) from
Operations and
before Income
Taxes and
Extraordinary
Item (1,471,707) 1,577,100
Income Taxes (800) (800)
Net Income (Loss)
before
Extraordinary Item (1,472,507) 1,576,300
Extraordinary Item,
net of tax (Note L) 707,233 707,233
Net Income (Loss) (765,274) 2,283,533
Net Income (Loss)
per Common Share
before
Extraordinary Item (1.76) 0.07
Extraordinary Item 0.84 0.03
Net Income (Loss)
per Common Share (0.91) 0.10
Weighted Average Number
of Shares Outstanding 838,313 23,227,163
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.
MIDLAND, INC.
(Registrant)
By: /s/ Charles Stidham
Charles Stidham, Executive
Vice-President
DATE: April 18, 1997
EXHIBITS
Exhibit 1. - Plan and Agreement of Purchase between registrant
and the shareholders of MILL-AGRO (HELLAS) SA and MEGAHEL
NAUTICAL SA
Exhibit 2. - Series B Preferred Stock Provisions
Exhibit 1.
PLAN AND AGREEMENT OF PURCHASE
This Plan and Agreement of Purchase entered into in Denver,
Colorado, this 18th day of February, 1997, between America's
Coffee Cup, Inc., D.B.A. Wayward Ventures, Inc., a Colorado
corporation, sometimes referred to in this Agreement as the
Purchaser, or ACC and the Shareholders of MILL-AGRO (HELLAS) SA,
a Panama Company, and MEGAHEL NAUTICAL SA, a Greek company,
sometimes referred to in this Agreement as the Shareholders and
listed on the signature page hereto by name, and MILL-AGRO
(HELLAS) SA and MEGAHEL NAUTICAL SA sometimes referred to in this
Agreement as the Acquired Corporations.
The Purchaser will acquire from the Shareholders 100% (100 shares
of MILL-AGRO and 100 Shares of MEGAHEL) shares of the issued and
outstanding shares of capital stock of the Acquired Corporations,
in exchange solely for shares of voting stock of the Purchaser.
Under this Plan, the Acquired Corporations will become
subsidiaries of the Purchaser.
ARTICLE I
EXCHANGE OF CAPITAL STOCK
Transfer of Acquired Corporation's Capital Stock
1.01 Subject to the terms and conditions of this Agreement, each
Shareholder of the Acquired Corporations will transfer and
deliver to the Purchaser on the Closing Date 100% of their
certificates for shares of Capital Stock of MILL-AGRO (HELLAS) SA
and MEGAHEL NAUTICAL SA, duly endorsed in blank.
Consideration for Transfer
1.02 In exchange for all shares transferred by the Shareholders
pursuant to Paragraph 1.01, the Purchaser will forthwith issue
and cause to be delivered to the Shareholders, at or immediately
subsequent to the Closing Date, 74,604 shares of Series A
Preferred Stock and 149,259 shares of Series B Preferred Stock.
The shares of Series A Preferred Stock shall each be convertible
into 35 shares of Common Stock in accordance with the terms and
conditions therefor as filed with the Secretary of State for the
State of Colorado on August 24, 1996, and shall each be entitled
to 35 votes on each matter to be submitted to the shareholders of
Purchaser, all in accordance with the aforesaid filing. The
shares of Series B Preferred Stock shall be convertible into 150
Shares of Common Stock for each share of Preferred B stock at any
time, at the option of the Holder, after the Charter of ACC is
amended to authorize the issuance of Fifty Million (50,000,000)
shares of Common Stock. Such amendment shall be filed as soon as
possible after this transaction closes. Until such time as the
holders of Preferred B convert they shall be allowed to vote said
preferred at any shareholders meeting as if it had been
converted. (I.E. Each share of Preferred B shall be entitled to a
vote of 150 shares of Common at any and all shareholders
meetings)
Closing Date
1.03 Subject to the conditions precedent set forth in this
Agreement, and the other obligations of the parties set forth in
the Agreement, the Plan of Purchase shall be consummated at
Denver Colorado on or before February 18th 1997, at 10:00
o'clock A.M. Consummation shall include the delivery by the
Shareholders of the Acquired Corporations, all of their shares of
Capital Stock of the Acquired Corporations, as provided in
Paragraph 1.01 of this Agreement, and the delivery by the
Purchaser of its shares of Common Stock, as provided in Paragraph
1.02 of this Agreement. The date of the consummation of this
Agreement is referred to as the "Closing Date." It is agreed that
Chris Traios shall be appointed to the ACC Board and shall be
elected Chairman/CEO of ACC as soon as the transaction closes.
Robert Marsik shall remain as a Board Member and shall be
appointed Executive Vice President of ACC, Mark Pierce will
remain as a member of the Board of Directors and Charles Stidham
will be appointed to the Board and will be appointed Managing
Director of North American Shipping and Trading Operations, E.
Robert Barbee shall be appointed a Director and shall be named a
Vice President of the Company and Arthur Malcolm shall be
appointed to the Board of Directors to make a total of six (6)
current Directors with a seventh Board Member to be nominated by
Chris Traios at a later date.
ARTICLE II
REPRESENTATIONS AND WARRANTIES ACQUIRED CORPORATION
Organization and Standing of Acquired Corporation
2.01 MILL-AGRO (HELLAS) SA and MEGAHEL NAUTICAL SA are
corporations duly organized, validly existing, and in good
standing under the laws of Panama and Greece, with corporate
power to own property and carry on their business as it is now
being conducted. Copies of the articles of incorporation of
MILL-AGRO (HELLAS) SA and MEGAHEL NAUTICAL SA, 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. MILL-AGRO (HELLAS) SA and MEGAHEL NAUTICAL SA, are
qualified to transact business as foreign corporations and are
in good standing in all jurisdictions in which their principal
properties are located or are not required to be qualified as a
foreign corporation to transact business in any other
jurisdiction.
Subsidiaries
2.02 MILL-AGRO (HELLAS) SA and MEGAHEL NAUTICAL SA have no
subsidiaries.
Capitalization
2.03 MILL-AGRO (HELLAS) SA and MEGAHEL NAUTICAL SA have an
authorized capitalization of 100 and 100 shares, and as of the
date of this Agreement One Hundred (100 ) shares are issued and
outstanding, fully paid, and non assessable, in each Corporation.
There are no outstanding subscriptions, options, contracts,
commitments, or demand relating to the authorize but unissued
stock of MILL-AGRO (HELLAS) SA and MEGAHEL NAUTICAL SA or other
agreements of any character under which MILL-AGRO (HELLAS) SA and
MEGAHEL NAUTICAL SA would be obligated to issue or purchase
shares of its capital stock.
Financial Statements
2.04 (a) A Balance Sheet as of December 31, 1996, is attached as
Exhibit A, reported on by Republic Of Greece, Ministry of
Commerce, dated February 14, 1997. Certified Financial
Statements will be provided by the Auditor of the Companies, in
accordance with GAAP and GAAS standards within Seventy Five (75)
days of the closing of this transaction. All the Certified
financial statements described in this Paragraph will be prepared
in conformity with generally accepted accounting principles,
applied on a consistent basis, and present fairly the financial
position of MILL-AGRO (HELLAS) SA and MEGAHEL NAUTICAL SA as of
December 31, 1996, subject to normal changes resulting from year
end audit of the financial statements as of December 1997. The
Financial Statements and opinions will conform with the
Requirements of Form 8-KSB.
(b) Other than changes in the usual and ordinary conduct of the
business since December 31, 1996, there have been and at the
Closing Date there will be, no materially adverse changes in such
financial conditions of MILL-AGRO (HELLAS) SA and MEGAHEL
NAUTICAL SA.
(c) Subject to any changes as a result of the ordinary and usual
course of business, the assets of MILL-AGRO (HELLAS) SA and
MEGAHEL NAUTICAL SA at the Closing Date will be substantially
those owned by it and shown on its financial statements as of
December 31, 1996.
(d) If the results of the Certified Audit does not conform with
the audit of the Ministry Of Commerce within (minus) - 20% then
this transaction is subject to recession by the prior Board of
ACC. The prior Board shall have the option of reversing the
closing this transaction, where the Stock issued by ACC shall be
canceled and the stock of MILL-AGRO and MEGAHEL shall be returned
to its original owners, the intent of this paragraph is to
restore the parties to this agreement to their position as if the
transaction had not closed.
Operations Since Balance Sheet
2.05 Since its Balance Sheet date of December 31, 1996, MILL
AGRO (HELLAS) SA and MEGAHEL NAUTICAL SA has not, and prior to
the Closing Date will not have:
(a) Issued or sold any stock, bond, or other corporate
securities;
(b) Except for liabilities incurred and obligations entered into
in the ordinary course of business, incurred any obsolete or
contingent obligation, including long-term debt;
(c) Except for liabilities shown on the balance sheet and
current liabilities incurred since that date in the ordinary
course of business, discharged or satisfied any lien or
encumbrance, or paid any obligation or liability;
(d) Mortgage, pledged, or subjected to lien any of its assets
except in the ordinary course of business;
(e) Except in the ordinary course of business, sold or
transferred any of its tangible assets, or canceled any debts or
claims, or waived any rights of substantial value;
(f) Sold, assigned, or transferred any patents, formulas,
trademarks, trade names, copyrights, licenses, or other
intangible assets;
(g) Incurred any materially adverse losses or damage, or become
involved in any strikes or other labor disputes;
(h) Entered into any transaction other than in the ordinary
course of business, except for the transaction that is the
subject matter of this Agreement;
Title to Assets
2.06 The Acquired Corporation has good and marketable title to
all its assets specified in the schedule described in Paragraph
2.07, and reflected in the Balance Sheet dated December 31, 1996.
All such assets are not subject to any mortgage, pledge, lien,
charge, security interest, encumbrance, or restriction except
those that:
(a) Are disclosed on the Balance Sheet as securing specified
liabilities;
(b) Are disclosed in the Schedule of Assets listed in Paragraph
2.07; or
(c) Do not materially adversely affect the use of the asset. The
buildings and equipment of MILL-AGRO (HELLAS) SA and MEGAHEL
NAUTICAL SA are in good condition and repair, except for
reasonable wear and tear.
Schedule of Assets
2.07 Prior to the Closing Date, the Acquired Corporation will
have delivered to the Purchaser a separate Schedule of Assets,
specifically referring to this paragraph, containing a true and
complete:
(a) Legal description of all real property owned by MILL-AGRO
(HELLAS) SA and MEGAHEL NAUTICAL SA and any real property in
which MILL-AGRO (HELLAS) SA and MEGAHEL NAUTICAL SA has a
leasehold interest;
(b) Aged list of accounts receivable as of the Closing Date;
(c) List of all capitalized machinery, tools, equipment, and
rolling stock owned by MILL-AGRO (HELLAS) SA and MEGAHEL NAUTICAL
SA that sets forth any liens, claims, encumbrances, charges,
restrictions, covenants, and conditions concerning the listed
items.
(d) Description of all machinery, tools, equipment, and rolling
stock in which MILL-AGRO (HELLAS) SA and MEGAHEL NAUTICAL SA has
a leasehold interest, with a description of each interest;
(e) A true and complete list of all patents, patent licenses,
trademarks, trademark registrations, trade names, copyrights, and
copyright registrations owned by MILL-AGRO (HELLAS) SA and
MEGAHEL NAUTICAL SA; and
(f) List of all fire and other casualty and liability policies
of MILL-AGRO (HELLAS) SA and MEGAHEL NAUTICAL SA in effect at the
time of delivery of such schedule.
(g) All software products including source codes.
2.08 (a) Except as set forth in the Balance Sheet of MILL-AGRO
(HELLAS) SA and MEGAHEL NAUTICAL SA, dated December 31, 1996,
described in Paragraph 2.05, MILL-AGRO (HELLAS) SA and MEGAHEL
NAUTICAL SA presently have no outstanding indebtedness other than
liabilities incurred in the ordinary course of business or in
connection with this transaction. MILL-AGRO (HELLAS) SA and
MEGAHEL NAUTICAL SA are not in default with respect to any terms
or conditions of any indebtedness.
(b) MILL-AGRO (HELLAS) SA and MEGAHEL NAUTICAL SA have not made
any assignment for the benefit of creditors, nor has any
involuntary or voluntary petition in bankruptcy been filed by or
against MILL-AGRO (HELLAS) SA and MEGAHEL NAUTICAL SA
Litigation
2.09 (a) MILL-AGRO (HELLAS) SA and MEGAHEL NAUTICAL SA are not a
party to, nor have they been threatened with, any litigation or
governmental proceeding that, if decided adversely to them, would
have a material adverse effect on the transaction contemplated by
this Agreement, or on the financial condition, net worth,
prospects, or business of MILL-AGRO (HELLAS) SA and MEGAHEL
NAUTICAL SA. To the best of the Acquired Corporations'
knowledge, they are not aware of any facts that might result in
any action, suit, or other proceeding that would result in any
material adverse change in the business or financial condition of
MILL-AGRO (HELLAS) SA and MEGAHEL NAUTICAL SA.
(b) To the best of their knowledge, MILL-AGRO (HELLAS) SA and
MEGAHEL NAUTICAL SA are not infringing on or otherwise acting
adversely to any copyrights, trademark rights, patent rights, or
licenses owned by any other person, and there is not pending
claim or threatened action with respect to such rights. MILL
AGRO (HELLAS) SA and MEGAHEL NAUTICAL SA are not obligated to
make any payments in the form of royalties, fees, or otherwise to
any owner or of any patent, trademark, trade name, or copyright.
Compliance With Law and Other Instruments
2.10 The business operation of MILL-AGRO (HELLAS) SA and MEGAHEL
NAUTICAL SA have been and is being conducted in accordance with
all applicable laws, rules, and regulations of all authorities.
MILL-AGRO (HELLAS) SA and MEGAHEL NAUTICAL SA are not in
violation of, or in default under, any terms or provision of its
Articles of Incorporation, its Bylaws, or of any lien, mortgage,
lease, agreement, instrument, order, judgment, or decree, or any
other type of restriction that would prevent consummation of the
exchange of securities contemplated by this Agreement.
Contractual Obligations
2.11 MILL-AGRO (HELLAS) SA and MEGAHEL NAUTICAL SA are not a
party to or bound by any written or oral:
(a) Contract not made in the ordinary course of business;
(b) Contract with any labor union other than in the ordinary
course of business;
(c) Bonus, pension, profit sharing, retirement, stock option,
hospitalization, group insurance, or similar plan providing
employee benefits other than in the ordinary course of business;
(d) Any real or personal property lease or lessor other than in
the ordinary course of business;
(e) Advertising contract or contract for public relations
services other than in the ordinary course of business;
(f) Purchase, supply, or service contracts in excess of $10,000
each, or in the aggregate of $100,000 for all such contracts
other than in the ordinary course of business;
(g) Deed of trust, mortgage, conditional sales contract,
security agreement, pledge agreement, trust receipt, or any other
agreement subjecting any of assets or properties of MILL-AGRO
(HELLAS) SA and MEGAHEL NAUTICAL SA to a lien, encumbrance, or
other restriction other than in the ordinary course of business;
(h) Term contract continuing for a period of more than 1 years
that is not terminable without liability to MILL-AGRO (HELLAS) SA
and MEGAHEL NAUTICAL SA or their successors other than in the
ordinary course of business; or
(i) Contract that
(i) Contains a predetermination of price or similar
type of provision; or
(ii) Provides for a fixed price for goods or services
sold. MILL-AGRO (HELLAS) SA and MEGAHEL NAUTICAL SA has
performed all obligations required to be performed by them to
date and is not in material default under any of the contracts,
leases, or other arrangements by which it is bound. None of the
parties with whom MILL-AGRO (HELLAS) SA and MEGAHEL NAUTICAL SA
has contractual arrangements are in default of their obligations.
Changes in Compensation
2.12 Since the Balance Sheet date of December 31, 1996, MILL
AGRO (HELLAS) SA and MEGAHEL NAUTICAL SA have not granted any
general pay increase to employees or changed the rate of
compensation, commission, or bonus payable to any officer,
employee, director, agent, or stockholder other than in the
normal course of business.
Inventories
2.13 Since the Balance Sheet date of December 31, 1996, MILL
AGRO (HELLAS) SA and MEGAHEL NAUTICAL SA have continued to
replenish their inventories in the customary manner of entities
engaged in the business MILL-AGRO (HELLAS) SA and MEGAHEL
NAUTICAL SA conducts, and will continue to do so until the
Closing Date.
Records
2.14 All of the account books, minute books, stock certificate
books, and stock transfer ledgers of MILL-AGRO (HELLAS) SA and
MEGAHEL NAUTICAL SA are complete and accurate.
No Brokers or Finders
2.15 All negotiations on the part of the Shareholders related to
this Agreement have been accomplished solely by the Shareholders
without the assistance of any person employed as a broker or
finder. The Shareholders have done nothing to give rise to any
valid claims against MILL-AGRO (HELLAS) SA and MEGAHEL NAUTICAL
SA for a brokers commission, finder's fee, or any similar charge.
Taxes
2.16 (a) MILL-AGRO (HELLAS) SA and MEGAHEL NAUTICAL SA have
filed all income tax returns and, in each jurisdiction where
qualified or incorporated, all income tax and franchise tax
returns that are required to be filed. MILL-AGRO (HELLAS) SA and
MEGAHEL NAUTICAL SA have paid all taxes as shown on the returns
as have become due, and have paid all assessments received that
have become due.
Full Disclosure
2.17 As of the Closing Date the Acquired Corporations will have
disclosed all events, conditions, and facts materially affecting
the business and prospects of MILL-AGRO (HELLAS) SA and MEGAHEL
NAUTICAL SA The Acquired Corporations have not withheld
knowledge of any events, conditions, and facts that they have
reasonable ground to know may materially affect the business and
prospects of MILL-AGRO (HELLAS) SA and MEGAHEL NAUTICAL SA None
of the representations and warranties made by the Acquired
Corporations in this Agreement or set forth in any other
instrument furnished to Purchaser contained any untrue statement
of a material fact, or fails to state a material fact.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF PURCHASER
Organization and Standing of Purchaser
3.01 America's Coffee Cup, Inc., DBA Wayward Ventures, 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
America's Coffee Cup, Inc., DBA Wayward Ventures, 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.,
DBA Wayward Ventures, Inc., is qualified as a foreign corporation
to transact business in other jurisdictions.
Subsidiaries
3.02 America's Coffee Cup, Inc., Wayward Ventures, Inc.,has one
subsidiary, also known as Americas's Coffee Cup, Inc., which
is a Colorado Corporation.
Capitalization
3.03 ACC has an authorized capitalization of 10,000,000 shares
of common stock of the par value of $0.40 per share, of which
861,000 shares will be validly issued, outstanding, and fully
paid as of the Closing Date. ACC will amend its charter to
increase the authorized to 50,000,000 as soon as possible after
the closing of this transaction. There will be at the Closing
Date no outstanding options, contracts, calls, commitments, or
demands relating to the authorized but unissued stock of ACC
except as follows:
(1) 861,567 shares of common stock issued and outstanding in the
hands of the public, including the two existing members of the
board governing Purchaser;
(2) 1,809,955 shares of common stock of the Purchaser underlying
certain Bridge Loan Options issued in connection with Purchaser's
recently completed public offering, as well as 2,585,650 warrants
underlying said option, each of which allow the acquisition of
one share of Purchaser's common stock;
(3) 1,890,000 shares of common stock underlying the shares of
Series A Preferred Stock issued to the persons purchasing said
shares in Purchaser's recently completed public offering, as well
as 2,700,000 warrants underlying said preferred shares, each of
which allow the acquisition of one share of Purchaser's common
stock;
(4) 1,172,360 shares of common stock underlying the 33,496
shares of Series A Preferred Stock subject to an option of the
board governing the Purchaser at the Closing Date; and
(5) 552,640 shares of common stock underlying options granted
pursuant to the existing stock option plan of the Purchaser.
ACC has 1,000,000 shares of preferred stock authorized, of which
54,000 shares were issued to the public and 33,496 are subject to
option by members of the current board governing ACC. Other than
as set forth above, there are no other outstanding options,
calls, contracts or commitments relating to authorized but
unissued Common or Preferred Stock, except the shares of Series B
preferred to be issued herein.
Financial Statements
3.04 ACC has delivered to the Acquired Corporation;
(a) The balance sheet of ACC of September 30, 1996 and the
related statements of income and retained earnings of ACC for the
period ended September 30, 1996 are true as of the signing of
this agreement. The December 31, 1995 10K and the Prospectus
dated August 14, 1996 have also been delivered to the selling
Shareholders.
All the financial statements listed in this Paragraph present
fairly the financial condition of ACC at the specified dates and
the results of its operations for the period specified. The
statements were prepared in accordance with generally accepted
accounting principles applied in a manner consistent with prior
accounting periods.
Financial Condition Since Balance Sheet Date
3.05 Since the Balance Sheet date of September 30, 1996, there
are changes, events, and conditions that have occurred that
materially and adversely affect the financial condition, assets,
business, or prospects of ACC, and said conditions have been
disclosed.
Title to Assets
3.07 All book assets of ACC are in existence in its possession,
are in good condition and repair, and conform to all applicable
zoning and building laws and ordinances. ACC has good and
marketable title to all of its assets and, except as shown on its
financial statements as of September 30, 1996 holds such assets
subject to no mortgage, lien, or encumbrance.
Status of Transferred Shares
3.08 The shares of stock of ACC that are to be issued and
delivered to shareholders of Acquired Corporation pursuant to the
terms of this agreement will be validly authorized and issued,
and will be fully paid and non assessable. No shareholder of ACC
will have any preemptive right of subscription or purchase with
respect to the shares to be transferred.
Indebtedness
3.09 Except as set forth in the balance sheet of ACC of
September 30, 1996, there is not outstanding indebtedness other
than liabilities incurred in the ordinarily course of business or
in connection with this transaction. ACC is in default with
respect to terms and conditions of indebtedness related to
Brothers Coffee and Ralph's Supermarkets on rent and the judgment
in favor of Brothers, Restaurant Blend and Daymar.
Litigation
3.10 ACC is not a party to, nor had it been threatened with any
litigation or governmental proceeding that could have a material,
adverse effect on the transaction contemplated by this Agreement
or on the financial condition of ACC other than Matossin, Abraham
and Christensen and Restaurant Blend and Daymar Corporation.
Purchaser's Authority
3.11 The execution and performance of this Agreement have been
duly authorized by all requisite corporate action to allow the B
Preferred to be issued, including the voting and conversion
rights and subject to shareholder approval shall increase the
authorized Common Stock to 50,000,000 and change the name of ACC
to Midland, Inc. This Agreement constitutes a valid and binding
obligation of America's Coffee Cup, Inc., Wayward Ventures, Inc.
in accordance with its terms. No provision of the Articles of
Incorporation, Bylaws, minutes, share certificates, or contracts
prevents America's Coffee Cup, Inc., Wayward Ventures, Inc. from
delivering good title to its shares of ACC capital stock in the
manner contemplated by this Agreement.
Brokers
3.12 America's Coffee Cup, Inc., Wayward Ventures, Inc. has not
retained nor otherwise utilized the services of any broker or
finder in connection with the transaction contemplated by this
Agreement. America's Coffee Cup, Inc., Wayward Ventures, Inc.
has done nothing to give rise to any valid claims against the
Acquired Corporation for a brokerage commission, finder's fee, or
any similar charge.
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 MILL-AGRO (HELLAS) SA and
MEGAHEL NAUTICAL SA and America's Coffee Cup, Inc., Wayward
Ventures, 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
transactions 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 Corporations shall have no
liability under this Agreement for any breach of the
representations or warranties made by MILL-AGRO (HELLAS) SA and
MEGAHEL NAUTICAL SA under this Agreement.
ARTICLES V
COMPLIANCE WITH SECURITIES LAWS
Unregistered Stock Under Federal Securities Act
5.01 (a) Each shareholder of the Acquired Corporations
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," and
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 acquiring 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 or any other distribution of the shares. Each
shareholder also represents and warrants that the shareholder has
no present intention 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 the 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., Wayward Ventures, 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 the 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(1)
of the Act.
The 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 any time in the future any of the shareholders of the
Acquired Corporations 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 that may be asserted against or
suffered by the Purchaser as a result of the such disposition.
Future Registration
(f) 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 a shareholder of
the Purchaser of shares of the Purchaser's Commons Stock for
cash, the Purchaser will mail to each shareholder written notice
of its intent 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 Commons 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 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 de register 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 shall bear all 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 indemnification's to the underwriters in any such offering
with respect to any shares included at the shareholder's request.
Securities Act
5.02 It is agreed that the consummation of this Agreement is not
subject to issuance by the Colorado Securities Commissioner of
any permit and any other requirements of Colorado law applying to
the issuance and transfer of the Purchaser's stock in exchange
for shares of Capital Stock of MILL-AGRO (HELLAS) SA and MEGAHEL
NAUTICAL SA
ARTICLE VI
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 MILL-AGRO (HELLAS) SA and MEGAHEL NAUTICAL SA and
the President of America's Coffee Cup, Inc., Wayward Ventures,
Inc. provided it has been approved by the Shareholders of each
party.
Waiver
6.02 Either MILL-AGRO (HELLAS) SA and MEGAHEL NAUTICAL SA or
America's Coffee Cup, Inc., Wayward Ventures, Inc. may, 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 inaccuracies
(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
(c) 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 assign able by either the MILL-AGRO
(HELLAS) SA and MEGAHEL NAUTICAL SA or America's Coffee Cup,
Inc., Wayward Ventures, Inc. without the prior written consent of
the other, except by the laws of succession.
(b) Except as limited 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 MILL-AGRO (HELLAS) SA and MEGAHEL NAUTICAL
SA, to:
MILL-AGRO (HELLAS) SA and MEGAHEL NAUTICAL SA
3 IRODOTOU STR
PIRAEUS Greece 18538
With a copy to: Treasure Bay Tunica, Inc.,
R 2, Box 35Q
Rockwall, Texas 75087
or to such other person or address designated by MILL-AGRO
(HELLAS) SA and MEGAHEL NAUTICAL SA to receive notice.
(b) In the case of America's Coffee Cup, Inc., Wayward
Ventures, Inc., to:
America's Coffee Cup, Inc.
12528 Kirkham Ct Suite 6
Poway, CA 92024
or to such other person or address designated by America's
Coffee Cup, Inc. to receive notice.
Headings
6.05 Paragraph and other headings contained 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, Agreement
between the parties with respect to the transaction contemplated
by the Agreement. It may be executed in any number of
counterparts by the aggregate of the counterparts together
constitute only one and the same instrument.
Effect of Partial Invalidity
6.07 In the event that any one or more of the provisions
contained in this Agreement shall for any reason be held to be
invalid, illegal, or unenforceable in any respect, such
invalidity, illegality, or unenforceability enforceability shall
not affect any other provisions of this Agreement, but this
Agreement shall be constructed as if it never contained any such
invalid, illegal, or unenforceable provisions.
Controlling Law
6.08 The validity, interpretation, and performance of this
agreement shall be controlled by and construed under the laws of
the of Colorado, the State in which this Agreement is being
executed.
Attorney's Fees
6.09 If any action at law or in equity, including an action for
declaratory relief, is brought to enforce or interpret the
provisions of this Agreement, the prevailing party shall be
entitled to recover reasonable attorney's fees from the other
party. The attorney's fees may be ordered by the court in the
trial of any action described in this Paragraph or may be
enforced in a separate action brought for determining attorney's
fees.
Specific Performance
6.10 The parties declare that it is impossible to measure in
money the damages that will accrue to a party or its successors
as a result of the other parties' failure to perform any of the
obligations under this Agreement. Therefore, if a party or its
successor institutes any action or proceeding to enforce the
provisions of this Agreement, any party opposing such action or
proceeding agrees that specific performance may be sought and
obtained for any breach of this Agreement.
Executed on 18th day of February, 1997, in Denver Colorado.
PURCHASER:
America's Coffee Cup, Inc. D.B.A. Wayward Ventures, Inc.
By:/s/ Robert W. Marsik
Its President
ACQUIRED CORPORATION:
MILL-AGRO (HELLAS) SA
By:
President
ACQUIRED CORPORATION
MEGAHEL NAUTICAL SA
By:
Its: President
By: Noble House SA
Shareholder
BY:
President
By: Treasure Bay Tunica, Inc.
Shareholder
By:
President
EXHIBIT 2 - PREFERRED STOCK PROVISIONS
SERIES B: VOTING, CONVERTIBLE PREFERRED STOCK
CERTIFICATE SETTING FORTH RESOLUTIONS
BY
THE BOARD OF DIRECTORS FOR
WAYWARD VENTURES, INC., f/k/a AMERICA'S COFFEE CUP, INC.
(Pursuant to the Colorado Corporation Code)
We, the undersigned, as the President and Secretary of Wayward
Ventures, Inc., f/k/a America's Coffee Cup, Inc., a Colorado
corporation, the Articles of Incorporation of which are on file
in the office of the Secretary of State for the State of Colorado
DO EACH HEREBY CERTIFY AND VERIFY: that the Board of Directors of
Wayward Ventures, Inc., f/k/a America's Coffee Cup, Inc., in
accordance with said articles and pursuant to the laws of the
State of Colorado, duly adopted on February 17, 1997, the
preambles and resolutions attached hereto.
IN WITNESS WHEREOF: We have set our hands and the corporate seal
this 17th day of February, 1997.
WAYWARD VENTURES, INC.
By: /s/ Robert W. Marsik [SEAL]
Robert W. Marsik, President
Attest:
/s/ Mark S. Pierce
Mark S. Pierce, Secretary
UNANIMOUS CONSENT IN LIEU OF SPECIAL MEETING
BOARD OF DIRECTORS
FOR
WAYWARD VENTURES, INC., f/k/a AMERICA'S COFFEE CUP, INC.
(February 17, 1997)
Pursuant to the provisions of the "Colorado Corporation Code"-
which provide that action required or permitted by said code to
be taken at a meeting of the board of directors of a corporation
may be taken without a meeting with the same force and effect as
a unanimous vote of said board if the action is (i) evidenced by
one or more written consents describing the action taken, (ii)
signed by each director and (iii) delivered to the secretary of
the corporation for filing with the corporate records - the
undersigned, being the sole members of the board of directors of
Wayward Ventures, Inc., f/k/a America's Coffee Cup, Inc.(the
"Board of Directors" and the "Company," respectively), do hereby
waive any and all notice which may be required to be given with
respect to a meeting of the Board of Directors and do hereby
take, ratify, confirm and approve the following action this 17th
day of February, 1997.
WHEREAS, the Company has been presented with an opportunity to
acquire as wholly-owned subsidiaries two separate business
entities, those being Megahel Nautical (Hellas) S.A., a Greek
company, and of Mill-Agro (Hellas) SA, a Panamanian company;
WHEREAS, the Company has been presented with a proposed Plan and
Agreement of Purchase (the Hellas Agreement) by and between the
Company and the shareholders (Shareholders) of Megahel Nautical
(Hellas) S.A. and of Mill-Agro (Hellas) SA;
WHEREAS, the Hellas Agreement requires the delivery to the
Shareholders of a series of preferred stock in order to
consummate said agreement;
WHEREAS, the execution and delivery of, and performance under,
the Hellas Agreement is in the best interests of the Company; and
WHEREAS, the Articles of Incorporation governing the Company (the
Articles of Incorporation) permit the issuance of preferred
shares in series with such designations, preferences and relative
participating option or other rights and qualifications,
limitations and restrictions as may be fixed by the Board of
Directors, including, without limitation, the rate of dividends
and redemption and conversion prices, all of which are to be
determined after giving consideration to the financial and
general condition of the Company and to the condition of the
securities' markets, if any, existing at the time of issuance;
and
WHEREAS, the directors deem it advisable to establish and issue a
new series of preferred stock at this time to accomplish the
consummation of the Hellas Agreement and have carefully
investigated the financial and general condition of the Company
and the relation of the condition of the Company to the condition
of the securities markets, and have determined that it is in the
best interests of the Company to establish a new series of
preferred stock to be denominated Series B: Voting, Convertible
Preferred Stock with the attributes set forth in this resolution
and to forthwith deliver a certificate evidencing the same to the
Shareholders:
NOW, THEREFORE, BE IT
RESOLVED, that the Board of Directors hereby authorizes the
Company to issue for the purpose of consummating the Hellas
Agreement One Hundred Forty-Nine Thousand Two Hundred and Fifty
Nine (149,259) shares of its Series B: Voting, Convertible
Preferred Stock at a price of $2,000 per share, which series
shall have the following features:
(a) Dividends - the record holders of the series shall not be
entitled to receive any dividends, whether out of the net
earnings of the Company or otherwise;
(b) Conversion - each share of the series shall be convertible at
any time and from time to time into one hundred fifty (150)
common shares of the Company (Common Stock) at the election of
the holders of record, and each share of this series which has
not been converted by October 1, 1998, shall automatically
convert into the aforesaid number of common shares;
(c) Redemption - neither the Company nor any one else shall have
any right to redeem the shares of this series at any time;
(d) Liquidation Preference - the holders of the series shall not
be entitled to any liquidation preference over any existing class
or series of outstanding stock of the Company or over any other
class or series of the Company which may be subsequently
established;
(e) Sinking Fund - the holders of this series shall not be
entitled to the establishment of any sinking fund for the purpose
or retiring the shares of the series or for any other purpose;
(f) Voting Rights - each share of this series shall be entitled,
for so long as such share remains outstanding to vote on any and
all matters which the holders of Common Stock and Series A
Preferred Stock are entitled to vote. The Series B Preferred
Stock shall vote as a class with the Common Stock and the Series
A Preferred Stock on all matters, other than as set forth
immediately below, and each outstanding share of Series B
Preferred Stock shall be entitled to One Hundred and Fifty (150)
votes on each matter submitted for approval. Further, and for so
long as any share of Series B Preferred Stock is outstanding, the
Company shall not, without the approval of the holders of no less
than two-thirds (2/3) of the outstanding Series B Preferred
Stock:
(a) amend or repeal any revision of, or add any provision to,
the articles of incorporation governing the Company, if such
action would alter or change the preferences, rights, privileges,
or powers of, or the restrictions provided for the benefit of,
the Series B Preferred Stock;
(b) authorize, create or issue shares of any class of stock
having any preference or priority superior to any preference or
priority of the Series B Preferred Stock, or authorize, create,
or issue shares of stock of any class or any obligations
convertible into or exchangeable for, or having optional rights
to purchase, any shares of stock of the Company having any such
preferences; or
(c) make any provision in the Bylaws governing the Company
imposing any restrictions upon the right to transfer or
hypothecate the Series B Preferred Stock, except provisions
required by the laws of the State of Colorado.
(g) Additional Provision - the series shall be issued, upon
compliance with the laws of the State of Colorado, in accordance
with those terms set forth on Exhibit A hereto, which is
specifically incorporated herein by this reference and adopted as
the act of the Company.
RESOLVED FURTHER that the President and the Secretary are hereby
authorized and directed to cause to be filed under corporate seal
such certificates as shall be requisite to the end that the stock
shall be issued and delivered to the Shareholders as aforesaid;
and
RESOLVED FINALLY that the President be, and he hereby is,
authorized to (i) effectuate, to the extent necessary and
appropriate, those actions taken hereby, (ii) issue a certificate
or certificates for the shares, (iii) prepare a form of
certificate for the shares in accordance with the above
resolutions and (iv) provide for filing all necessary
documentation with the Secretary of State for the State of
Colorado, applicable state securities authorities and the United
States Securities and Exchange Commission.
IN WITNESS WHEREOF, the undersigned, being the sole member of the
Board of Directors, have hereunto set their hands effective as of
the date first specified above.
/s/ Robert W. Marsik
Robert W. Marsik, Director
/s/ Mark S. Pierce
Mark S. Pierce, Director
EXHIBIT A
SERIES B: CONVERTIBLE, VOTING PREFERRED STOCK PROVISIONS
The Series B Convertible, Voting Preferred Stock (the Preferred
Stock or the Series B Preferred Stock) shall consist of one (1)
series of One Hundred Forty-Nine Thousand Two Hundred and Fifty
Nine (149,259) shares of the preferred stock of America's Coffee
Cup, Inc., d/b/a Wayward Ventures, Inc. (the Company), with each
share to be identical to every other in all respects. The
following sets forth the provisions of the Series B Preferred
Stock.
Part 1: Dividends
Dividend Obligation. The holders of the issued and outstanding
Series B Preferred Stock shall not be entitled to receive any
dividends on their shares of stock.
Part 2: Conversion
(2.01) Conversion Price and Automatic Conversion. Each share of
outstanding Series B Preferred Stock is convertible into One
Hundred Fifty (150) shares of the common stock of the Company
(the Conversion Amount and the Company, respectively) at any time
prior to October 1,1998, at the sole option of the holder of each
share of Series B Preferred Stock. On October 1, 1998, the
Series B Preferred Stock shall automatically convert into One
Hundred fifty (150) shares of Common Stock.
(2.02) Exercise Procedure. Any share of Series B Preferred
Stock shall be deemed to have been exercised when the Company
shall have received the certificate evidencing such shares
appropriately endorsed to reflect conversion thereof, whereupon
the Company shall issue the shares of Common Stock to which the
exercising shareholder is entitled.
(2.03) Reservation of Shares. The Company shall at all times
reserve and keep available for the purpose of effecting the
conversion of the Series B Preferred Stock the full number of
shares of Common Stock then deliverable upon the conversion of
all shares of the then outstanding Series B Preferred Stock.
(2.04) Fractional Shares. No fractional share of Common Stock
shall be issued upon conversion of a Series B Preferred Stock
share, but, instead of any fraction of a share which would
otherwise be issuable, the Company shall pay to the holder an
amount equal to the book value allocable to the fractional share
of Common Stock which would have otherwise been issued, as
determined using Generally Accepted Accounting Principles.
(2.05) Payment of Taxes. The Company shall pay any and all
taxes that may be required in respect of the issuance or delivery
of Common Stock on conversion of a share of Series B Preferred
Stock. The Company shall not, however, be required to pay any
tax which may be payable in respect of any transfer involved in
the issuance and delivery of Common Stock in a name other than
that in which the shares being converted were registered, and no
such issuance or delivery shall be made unless and until the
person requesting such has paid to the Company the amount of any
such tax, or has established to the satisfaction of the Company
that such tax has been paid.
(2.06) Registration, Approval and Listing. If any shares of
Common Stock required to be issued upon conversion of Series B
Preferred Stock shall require registration with or approval by
any governmental authority under any federal or state law, or
listing on any national securities exchange before such shares
may be issued, the Company shall, at its own expense, cause the
accomplishment of the same, and shall expeditiously work towards
accomplishment of the same; however, each holder of Series B
Preferred Stock shall be obligated to assist the Company to the
fullest extent possible in its endeavors.
(2.07) Delivery of New Certificates. Certificates for Common
Stock acquired upon conversion shall be delivered to the holder
named therein within 15 business days after exercise and delivery
to the Company. Unless all shares of Series B Preferred Stock
are converted, the Company shall, within the aforesaid period,
prepare a new certificate, substantially identical to that
surrendered, representing the balance of the shares previously
represented which have not been converted.
(2.08) Converted Series B Preferred Stock to be Canceled or
Returned to Treasury. The Company, by resolution of its Board
of Directors, may, in its sole discretion, either cancel or
return to treasury any shares of Series B Preferred Stock
converted or for any other reason acquired.
Part 3: Redemption
Optional and Mandatory Redemption. No one, including the
Company, shall be entitled to redeem the Series B Preferred Stock
under any circumstances at any time.
Part 4: Liquidation.
The Series B Preferred Stock shall not be entitled to
preferential liquidation rights over any other class or series of
stock previously or which may subsequently be issued by the
Company.
Part 5: Sinking Fund
The Series B Preferred Stock shall not be entitled to the
establishment of any sinking fund for any purpose.
Part 6: Voting Rights
(6.01) General Voting Right. The Series B Preferred Stock shall
be entitled to vote on any and all matters which the holders of
Common Stock and Series A Preferred Stock are entitled to vote.
The Series B Preferred Stock shall vote as a class with the
Common Stock and the Series A Preferred Stock on all matters,
other than as set forth below in this Part 6, and each
outstanding share of Series B Preferred Stock shall be entitled
to One Hundred and Fifty (150) votes on each matter submitted for
approval.
(6.02) Separate Voting Approval of Series B Preferred Stock
Required. As long as any share of Series B Preferred Stock is
outstanding, the Company shall not, without the approval of the
holders of no less than two-thirds (2/3) of the outstanding
Series B Preferred Stock:
(a) amend or repeal any revision of, or add any provision to,
the articles of incorporation governing the Company, if such
action would alter or change the preferences, rights, privileges,
or powers of, or the restrictions provided for the benefit of,
the Series B Preferred Stock;
(b) authorize, create or issue shares of any class of stock
having any preference or priority superior to any preference or
priority of the Series B Preferred Stock, or authorize, create,
or issue shares of stock of any class or any obligations
convertible into or exchangeable for, or having optional rights
to purchase, any shares of stock of the Company having any such
preferences; or
(c) make any provision in the Bylaws governing the Company
imposing any restrictions upon the right to transfer or
hypothecate the Series B Preferred Stock, except provisions
required by the laws of the State of Colorado.
Part 7: Adjustment of Conversion Amount.
The Conversion Amount shall be subject to adjustment as follows:
(7.01) If prior to the expiration of the conversion period by its
terms the Company shall issue any shares of Common Stock as a
share dividend or shall subdivide the number of outstanding
shares of Common Stock into a greater number of shares, the
Conversion Amount shall be increased proportionately.
Conversely, if the Company shall reduce the number of shares of
Common Stock outstanding by combining such shares into a smaller
number of shares, the Conversion Amount shall be decreased
proportionately.
(7.02) Notwithstanding the provisions of this Part 7, no
adjustments of the Conversion Amount shall be made whereby such
amount is adjusted in an amount by less than ten shares of Common
Stock, or until the aggregate of such adjustments shall equal or
exceed ten shares of Common Stock.
(7.03) No adjustment of the Conversion Amount shall be made as a
result of or in connection with the issuance of Common Stock
pursuant to (i) options, warrants, and/or share purchase
agreements outstanding or in effect on the date hereof (ii) the
establishment of additional option or warrant plans of the
Company, (iii) the modification, renewal or extension of any plan
now in effect or hereafter created, (iv) the issuance of Common
Stock on exercise of any options pursuant to such plans, (v) the
issuance of Common Stock in connection with an acquisition,
consolidation, recapitalization or merger of any type, (vi)
compensation or similar arrangements for officers, employees,
contractors, consultants or agents of the Company or any
subsidiary or (vii) the issuance of Common Stock in private or
public offerings.
(7.04) Before taking any action which would cause an adjustment
reducing the Conversion Amount to less than the par value of the
Common Stock issuable upon conversion of the Series B Preferred
Stock, the Company shall take any corporate action which may, in
the opinion of its counsel, be necessary in order that the
Company may validly and legally issue fully paid and
nonassessable shares of Common Stock at the adjusted Conversion
Amount.
Part 8: Additional Provisions.
The Series B Preferred Stock may be subordinated in any respect
to the terms and provisions of the Common Stock and to the terms
and provisions of any other series of the outstanding preferred
stock of the Company which may be issued and become outstanding
subsequent to the Series B Preferred Stock, unless specifically
provided to the contrary above.
