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EXHIBIT 10.23
[NORPAK LOGO]
January 12, 2000
Sunswipe Inc.,
0000 Xxxxxxxx Xxxxx
Xxxxx Xxxxx, XX X.X.X.
Attention: Xxxxx Xxxxxx
Dear Xxx,
Re: Sunswipe Inc. ("Sunswipe") and Xxxxxx (U.S.), Inc ("Norpak)
This letter shall confirm our agreement with respect to certain business
transactions to be completed by and between Norpak and Xxxxxxxx as follows:
1. In consideration of the commitments of Norpak herein, the
parties agree that, upon the request of Norpak, all assets
and undertakings of Sunswipe, including, but not limited to
all inventories of any nature, receivables, trademarks, and
property will be sold to a new corporation ("TSC") in
exchange for the TSC shares and Veridien Corporation (VRDE)
options referred to herein. Sunswipe will receive the
following consideration on the completion of the sale (i) 50%
of the issued common stock of TSC to match issued shares to
Norpak at the time of issue to Sunswipe (ii) an option to be
arranged by Norpak to purchase 1,000,000 common shares of
VRDE at an exercise price of 10 cents per share and with a
term on the option of 25 months from the date of execution of
this agreement (the "Options"). The vesting of the Options is
conditional as follows:
1. 100,000 options vested upon execution of this
agreement;
2. 200,000 options vested upon execution of this
agreement and delivery of the security set out in
Section IV;
3. 350,000 options vested upon reaching a) sales in
year 2000 of $1,000,000 or b) $250,000 in net income
before tax, pursuant to generally accepted
accounting principals ("GAAP"), ("Net Income") in
year 2000 or c) upon reaching any of the tests set
out in 4 below;
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4. 350,000 options vested upon reaching $400,000 net
income in year 2000 or $500,000 in year 2000 and
year 2001 combined; and,
5. At time of vesting, Xxxxx Xxxxxx must be employed or
providing his services on a full time basis to
either of TSC, Sunswipe and in any event to such
entity directed by Xxxxxx.
All remaining shares of TSC would be held by Xxxxxx or dealt
with as directed by Xxxxxx.
In the event the assets of Sunswipe are not sold to TSC as
set out above, Norpak would have an option to acquire 50% of
the stock of Sunswipe in consideration of $100 paid by Xxxxxx
and the commitment of the loan set out in Section VII and the
delivery of the Option to Sunswipe.
II. TSC or Sunswipe, as determined by Norpak as applicable,
("Operating Business") will purchase certain products from
Norpak and Norpak will provide certain services to Operating
Business on the following terms. In addition to the base
price of the products to be set from time to time and
additional services related thereto, Norpak will be entitled
to receive 50% of the pre-tax net income of Operating
Business. Contemporaneous with the distribution of the
pre-tax net income, of Operating Business, Operating
Business, will pay each of Xxxxx Xxxxxx and Uoli Fellig an
annual fee equal to 10% of the pre-tax net income of
Operating Business to a maximum of $50,000 each for their
full time service to Operating Business or as directed by
Xxxxxx ("Employment Fee"). As part of this Agreement Xxxxx
Xxxxxx will cause new sales and business opportunities to be
marshaled through Operating Business to generate income. The
parties may establish a draw agreement satisfactory to all
parties for the payment of the Employment Fee provided
monthly cashflow permits.
III. In determining the pre-tax net income amounts, products and
services owed to Norpak will be paid first, all other costs
for production and raw materials will be paid secondly, third
party expenses incurred or paid directly by Xxxxx and Xxxx
Xxxxxx will be paid thirdly, then the Employment Fee will be
paid contemporaneous with the pre-tax net income
distribution. In any event, all products purchased from
Norpak must be paid in full within six months from the
delivery of the products. Any amounts outstanding in excess
of six months would be paid for in full prior to payment of
the Employment Fee and the distribution of the pre-tax net
income. In the event that there are shareholder loans due to
Xxxxx Xxxxxx or Uoli Fellig or any related party from
Sunswipe, which existed prior to the involvement of Norpak,
such loans would be repaid from Xxxxxx'x 50% of the pre-tax
net income of Operating Business. Any shareholder loans so
made subsequent to the involvement of Norpak would be repaid
prior to the pre-tax net income distribution or pursuant to
such other agreements between the parties. All such
calculations shall be made in accordance with GAAP.
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IV. Xxxxx Xxxxxx agrees to personally guarantee the obligations
of Operating Business to Norpak. As well he will arrange to
secure said guarantee with a collateral mortgage on the
property referenced on Schedule A attached hereto in the
amount of $500,000. Xxxxxx will receive a first ranking
assignment of all inventory and receivables of Operating
Business as security for Operating Business' obligations to
Norpak.
X. Xxxxxx will oversee and control the collection of payments
made to Operating Business as an additional service to
Operating Business. Norpak is authorized to apply any
proceeds received by it on behalf of Operating Business in
payment of any amounts due to Norpak by Operating Business.
VI. Xxxxx Xxxxxx and Xxxx Xxxxxx when employed or retained by
Operating Business will enter into a non-compete agreement
with Operating Business in which he will agree not to sell or
market, either directly or indirectly any products that
compete with products of Operating Business during the term
of this agreement and for a period of 1 year from the
termination of his employment with Operating Business.
VII. Xxxxxx agrees to lend to Operating Business, up to $10,000
per month in each of the 3 months following the execution of
this Agreement. The maximum amount required to be advanced
will be $30,000 in aggregate with such advances to be made on
standard commercial terms and against a budget and business
plan approved by Norpak. This loan will be secured by the
personal guarantee of Xxxxx Xxxxxx described above.
VIII. The parties hereto agree that initially Xxxxx Xxxxxx will act
as President and Xxxx Xxxxxx will act as Vice President of
Operating Business with such additional Officers/Directors
appointed as are recommended by Xxxxxx.
IX. The parties hereto also agree that the obligations of
Sunswipe under any existing contracts or agreements between
Sunswipe and Veridien Corporation may be assumed by TSC.
X. Xxxxx Xxxxxx undertakes and agrees to use his best efforts to
secure third party financing for Operating Business to
finance the purchase of products from Norpak as contemplated
hereunder and other requirements of the Operating Business
and agrees to guarantee said financing if necessary.
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XI. The parties agree to execute such further documents prepared
by Xxxxxx relating to this matter. Any legal costs with
respect to documentation will be a cost of Sunswipe or TSC as
applicable.
Yours truly,
Norpak (U.S.), Inc.,
Per:
/s/ Xxxxxxx X. Xxxxxx
----------------------------
Xxxxxxx X. Xxxxxx, President
Agreed to and accepted by:
Sunswipe Inc.
Per:
/s/ Xxxxx Xxxxxx
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Xxxxx Xxxxxx
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SCHEDULE A
LEGAL DESCRIPTION OF PROPERTY - XXXXX XXXXXX
Orchard Sub 2&3 P.B. 8-116 Lot #6 and N15 feet of Lot #5 Block 47
Lot size 100 ft. by 200 ft.
Taken by phone December 29, 1999 Xxxxx Xxxxxx
Address of above property:
0000 Xxxxxxxx Xxxxx
Xxxxx Xxxxx, Xxxxxxx
00000 U.S.A.
