Exhibit 99.1
Letter of Intent
This letter of intent will confirm the mutual intent of G/O International,
Inc., a corporation organized under the laws of Colorado ("G/O"), and SH
Celera Capital Corporation, a corporation organized under the laws of
Maryland ("SH Celera") in pursuing the reorganization transaction described
herein below (referred to hereinafter as the "Reorganization Transaction").
1. Closing.
On the date of closing ("Closing"), as defined in the definitive
reorganization plan and agreement to be entered into between and among SH
Celera and G/O, the parties hereto shall undertake the transactions as set
forth herein below.
2. Tax Consequences.
No party to this Letter of Intent makes any representation or warranty as
to the tax consequences of the transfers contemplated hereby. Each party
agrees to obtain and be guided by its own tax advisor. It is the intent of
the parties, however, that the transaction contemplated hereby be a tax-
free reorganization.
3. The Reorganization Transaction.
At the time of Closing of the Reorganization Transaction:
A. SH Celera shall: (i) assume up to $65,000 of the current liabilities of
G/O; (ii) provide G/O with working capital of $50,000; (iii) enter into the
Facilities Administration and Operating Services Agreement ("the FA&SO
Agreement")as described in paragraph 5 herein below; (iv) commit to issue
486,053 shares of its $0.001 par value per share common stock upon terms
set forth in paragraph 7 herein below; and (iv) assign to G/O all of its
rights under the Retainer Agreement(s) set forth in Schedule 1 hereto,
which by this reference is incorporated herein.
B. G/O shall: (i) deliver to SH Celera a total of 17,300,744 newly issued
post-split shares of its $0.01 par value per share common stock; (ii)
transfer to SH Celera a total of 356,999 shares of Waterbury Resources,
Ltd., a Cayman Islands company; (iii) enter into the Facilities
Administration and Operating Services Agreement as described in paragraph 5
herein below, and (iv) assume the duties set forth in the Retainer
Agreements set forth in Schedule 1 hereto and, in connection therewith,
undertake providing fee based business consulting services pursuant
thereto.
At the time of Closing of such Reorganization Transaction:
A. SH Celera will have issued and outstanding a total of not greater than
9,235,000 shares of its $0.001 par value per share common stock.
Consequently, the 486,053 shares of SH Celera's common stock issuable to
G/O for distribution to its shareholders, as provided in paragraph 7,
herein below, will represent 5% of the issued and outstanding shares of SH
Celera's common stock as of the Closing.
B. G/O will have issued and outstanding a total of not greater than
4,325,186 shares of its $0.01 par value per share common stock.
Consequently, at the conclusion of the Reorganization Transaction, G/O will
have outstanding a total of 21,625,930 shares of its common stock, $0.01
par value per share, of which 17,300,744 shares or 80% will be owned by SH
Celera and 4,325,186 shares or 20% will be owned by the existing
shareholders of G/O, calculated as of the date of Closing.
4. Reverse Split of G/O Shares, Appointment of New Member to G/O's Board of
Directors and Change of Name.
Prior to the Closing of the Reorganization Transaction, G/O shall have
completed the reverse split of its currently outstanding 8,650,372 shares
of common stock in the ratio of 1 for 2 resulting in a total of 4,325,186
shares of its $0.001 par value per share common stock being issued and
outstanding, on a post-split basis.
At the time of Closing: (1) Michael Caswell shall resign as a director of
G/O and SH Celera shall designate one person to fill the vacancy on G/O's
Board of Directors created by such resignation, and (ii) G/O shall change
its name to "G/O Business Solutions, Inc."
5. Facilities, Administration and Operating Services Agreement.
At the time of Closing of the Reorganization Transaction, SH Celera and G/O
shall enter into the FA&OS Agreement, in form and substance mutually agreed
upon by each of SH Celera and G/O, pursuant to which SH Celera would
provide all facilities, administration and operating services necessary for
G/O to conduct a fee based business consulting practice under the trade
name of "G/O Business Solutions Inc." The FA&OS Agreement shall provide
that SH Celera would be paid a monthly fixed fee of $10,000 per month
("Fixed Fee") and would be reimbursed one half of the monthly salary of
Brian Rodriguez (or $4,166 per month) and all of the monthly salary of
Dwayne Deslatte (or $6,250 per month) (the "SH Celera Staff Reimbursement")
with the balance of cash income generated from such cash fees, after
payment of the Fixed Fee and the SH Celera Staff Reimbursement, split
equally. The FA&OS Agreement will also provide that any non-cash fees
received by G/O, in connection with providing the consulting services, will
be distributed directly to G/O's stockholders and, in the case of share
compensation received from a client company, shall be distributed by G/O
pursuant to a registration of such shares under the 33 Act. Such FA&OS
Agreement would remain in effect until the earlier of: G/O successfully
raising not less than $2,500,000 in the Contemplated Financing, as set
forth in paragraph 6 herein below, or G/O's accumulation of cash reserves
equaling not less than one year's projected required operating cash.
6. G/O's Contemplated Financing.
Following completion of the Reorganization Transaction, G/O shall undertake
to raise, in a private placement, a minimum of $2,500,000 and up to
$5,000,000 in equity capital through the sale of its shares of preferred
stock with the following rights, duties and preferences (the "Contemplated
Financing"): (i) a stated value equal to the price per share paid for the
shares of preferred stock plus accumulated and unpaid dividends, (ii) a
dividend preference equal to a fixed annual percentage rate (to be
determined by our board of directors) multiplied times the stated value of
each share of preferred stock, which shall be cumulative and paid before
any dividends respecting any other class of shares ("Fixed Rate Dividend")
plus a fixed percentage participation in distributions to stockholders, (to
be determined by the our board of directors), which shall be paid at the
time of any distribution to any of our stockholders, (iii) a liquidation
preference equal to the stated value plus any accumulated and unpaid Fixed
Rate Dividends, (iv) a securitization of the stated value and a portion of
the Fixed Rate Dividend through the purchase and deposit by the Company of
a fixed rate financial instrument suitable to the purchaser(s) of the
preferred stock, and (v) representation on our board of directors or the
right to attend an observe, at the discretion of the majority of the
holders of the preferred stock.
G/O's board of directors shall, subject to the approval of SH Celera,
determine the terms upon which such shares of Preferred Stock are sold and
the rights and privileges granted to purchasers of the shares of Preferred
Stock, including, but not limited to: (i) the price per share, (ii) the
granting of conversion features (iii) the fixed dividend rate, (iv) the
nature of the securitization including the coverage ratio on the Stated
Value and the differential on the dividend rate and (v) the percentage
participation in future dividends and distributions to our stockholders.
7. Issuance of SH Celera Shares.
SH Celera, upon fulfillment of the following conditions, shall issue a
total of 486,053 shares of its $0.001 par value per share common stock to
G/O for further distribution of such shares to the shareholders of G/O
determined on the date of Closing: (i) G/O shall have a net worth of not
less than $2,500,000; (ii) SH Celera shall have: (a) registered its shares
of $0.001 par value per share common stock under Section 13 or 15(d) of the
Securities Exchange Act of 1934, as amended (the "34 Act"), (b) taken such
steps as required to qualify its shares of common stock as "Covered
Securities" as defined in Section 18 of the Securities Act of 1933, as
amended (the "33 Act"), and (c) SH Celera shall have registered the shares
of common stock issuable to G/O in the Reorganization Transaction for
distribution to G/O's shareholders, determined at the time of the Closing
pursuant to the 33 Act. In connection therewith, SH Celera and G/O shall
execute and deliver, at Closing, an Undertaking Agreement in form and
substance mutually agreed upon by SH Celera and G/O, setting forth the
foregoing terms, conditions and undertakings respecting the issuance and
distribution of SH Celera's shares of common stock.
8. Reorganization Agreement.
It is the mutual understanding of the parties that the contemplated
Reorganization Transaction would be conducted pursuant to a mutually
suitable Reorganization Plan and Agreement ("Agreement") reflecting the
foregoing provisions and including such other ancillary agreements, which,
taken together, will include such terms and conditions as are mutually
agreed upon among the parties thereto in the course of good faith
negotiations and as are usual and customary in transactions of the type
contemplated hereby. In connection therewith:
A. Representations and Warranties. The Agreement to be
executed by the parties shall contain customary and usual
representations and warranties by the parties, and the
principal executive officer of each of the parties shall
certify these representations and warranties "to the best
of their personal knowledge and information."
B. Further Terms. The Agreement to be executed by the
parties shall provide for the examination and inspection
of the books and records of each of the parties prior to
Closing; the delivery no later than ten days prior to the
date of Closing of customary schedules listing each
party's material contracts; real and personal properties;
pending, threatened and contemplated legal proceedings;
employees; assets and liabilities, including
contingencies and commitments; and other information
reasonably requested. Each of the parties shall provide
audited financial statements consisting of a balance
sheet and a related statement of income for the period
then ended, which fairly present the financial condition
of each as of their respective dates and for the periods
involved, and such statements shall be prepared in
accordance with generally accepted accounting principles
consistently applied or upon such other basis as the
parties shall mutually agree and for the periods mutually
agreed upon among the parties.
The Agreement shall contain customary and usual
indemnification and hold harmless provisions.
C. Conditions Precedent. In addition to the foregoing terms,
the Agreement would contain the following conditions
precedent:
(i) Counsel for G/O shall have completed a review of SH
Celera and counsel for SH Celera shall have completed a
review of G/O.
(ii) SH Celera and G/O shall have performed, in all
material respects, all of their obligations under the
Agreement. All of the statements, representations and
warranties contained in the Agreement shall be complete
and true in all material respects.
(iii) No material adverse changes shall have occurred in
the business, properties and assets of SH Celera or of
G/O, other than changes set forth in the Agreement or
occurring in the ordinary course of business.
(iv) G/O shall have completed the reverse split of its
8,650,372 shares of $0.01 par value per share common
stock currently outstanding, in the ratio of 1 for 2,
resulting in a total of 4,325,186 shares, post-split,
issued and outstanding.
(v) SH Celera shall have completed the reverse split of
its 18,470,000 shares of $0.001 par value per share
common stock currently outstanding, in the ratio of 1 for
2, resulting in a total of 9,235,000 shares post-split,
issued and outstanding.
D. Simultaneous or Subsequent Conditions. In addition to the
foregoing terms and conditions precedent, the Agreement
will contain the following conditions that shall occur
either simultaneous with the Closing of the contemplated
Reorganization Transaction or within 45 days thereafter:
(i) Michael Caswell shall resign as a director of G/O and
SH Celera shall designate one person to fill the
vacancy on G/O's Board of Directors created by such
resignation. In connection therewith, G/O shall
file the appropriate notices under Section 14(f) of
the 34 Act; and
(ii) Each of SH Celera and G/O shall execute and deliver
the FA&OS Agreement and G/O shall commence, through
the FA&OS Agreement, providing fee based business
consulting services under the trade name G/O
Business Solutions, Inc.; and
(iii) SH Celera and G/O shall execute and deliver the
Undertaking Agreement respecting the issuance of
the SH Celera shares to G/O for further
distribution to G/O's shareholders pursuant to a
registration under the 33 Act; and
(iv) G/O shall transfer to SH Celera a total of 356,999
shares of Waterbury Resources, Ltd.; and
(v) SH Celera shall assign and transfer to G/O all of
its right title and interest in those Retainer
Agreements set forth in Schedule 1 hereto and G/O
shall assume all duties thereunder; and
(vi) G/O shall change its name to "G/O Business
Solutions, Inc.;" and
(vii) G/O shall commence providing the fee based business
consulting services under the trade name "G/O
Business Solutions, Inc."; and
(viii) G/O shall undertake the Contemplated Financing.
9. Restricted Shares.
It is understood that: (i) the shares of G/O to be issued to SH Celera, and
(ii) the share of Waterbury to be transferred to SH Celera in the
Reorganization Transaction shall be issued and/or transferred by G/O under
the exemption from registration provided for under Section 4(2) of the 33
Act. Consequently, such shares may be "restricted shares" as such term is
defined under Rule 144 of the 33 Act and appropriate legends shall be
placed upon certificates and stop transfers shall be placed in the stock
records of G/O and Waterbury. In addition, prior to the transfer of any of
the G/O shares or the Waterbury shares, SH Celera, through execution of
appropriate subscription forms, will be required to confirm its intention
to acquire the shares of G/O and/or Waterbury for investment and not with a
view for resale or distribution.
10. Negotiations with Third Parties.
In consideration of the undertaking by each of SH Celera and G/O of the
substantial legal, accounting, and other expenses incident to its further
investigation of each other's finances and operations and the preparation
of the Agreement and the ancillary agreements, each of SH Celera and G/O
agree that, until 180 days following the execution and delivery of this
Letter of Intent, each will refrain from entering into or pursuing any
arrangements or negotiations with any other party relative to the merger,
acquisition or reorganization of their respective company with or into any
other party.
11. Expenses.
SH Celera shall be responsible for the legal expenses incurred by G/O in
connection with the completion of the Reorganization Transaction, not to
exceed $25,000.
12. Professional and Advisory Fees.
Each of the parties represent and warrant that, except as to the foregoing
fees, they have not authorized any broker, finder or agent to represent
them in connection with the negotiations of this transaction and each
agrees to hold the other harmless from any other claim, commission,
finder's or broker's fee because of any act, omission, or statement of
either party pertaining to the proposed transaction.
13. Binding Effect.
The parties acknowledge that their mutual intent to proceed with the
Reorganization Transaction is subject to several preconditions. This letter
shall not constitute a legal obligation between them, except as to
paragraphs 10 and 11 hereof and no party hereto shall have any obligation
of any kind to consummate the transaction contemplated hereby until and
unless the various documents contemplated hereby are authorized, executed,
and delivered. Each party agrees to exercise good faith and its best
efforts to complete the Reorganization Transaction as contemplated hereby.
14. Counterpart Signature.
This Letter of Intent may be executed in any number of counterparts, each
of which when executed and delivered shall be deemed an original, but all
of which, together, shall constitute one and the same instrument.
Affirmed and Agreed to this 26th
day of June, 2006 by
G/O International, Inc., a
Colorado corporation
By/s/Brian Rodriguez
Brian Rodriguez, President
Affirmed and Agreed to this 26th
day of June 2006 by SH Celera Capital
Corporation, a Maryland corporation
By /s/George Jarkesy
George Jarkesy, President
Schedule 1
Retainer Agreements Assigned to G/O
At the time of Closing, SH Celera shall assign to G/O through an
Assignment, Assumption and Confirmation Agreement, in form and substance
agreed upon between the parties, all right title and interest in those
Retainer Agreements set forth herein, below, subject to G/O executing all
undertakings as required therein, to wit:
1. The Retainer Agreement dated June 16, 2006 between and among SH Celera
Capital Corporation, HoustonPharma, Inc., and the Principal Shareholders of
HoustonPharma.
2. The Retainer Agreement dated June 9, 2006 between and among SH Celera
Capital Corporation, on the one hand, and X-tra Light Manufacturing, Inc.
("XM"), X-tra Light Services LLC ('XS") and the Principal Members of XS
on the other hand.