LETTER OF INTENT (LOI)

 

 

 

 

A: Upon the SEA consummation, FTS, and or its designees or nominees, shall be transferred 30% equity ownership of TENP.   This equity value shall be represented by and will include all classes of stock authorized and issued on the closing date.  Both parties shall submit their equity interest, whether contractually or physically, i.e. stock certificates, to the escrow agent for safe keeping until such point that the SEA has been satisfied or terminated.

B: FTS will provide the necessary personnel to continue the accounting,   regulatory   and   legal   requirements   associated   with   the operation of TENP.  Three directors shall be appointed to TENP’s Board of Directors; two directors of FTS’s choosing and one of TENP’s choice until such point that the SEA has been satisfied or terminated.

C: Both parties acknowledge that capital will need to be provided from internal and or external sources to achieve the mutual goal set forth by the SEA; on a best efforts basis, both parties agree that they shall implement an equitable split concerning any potential initial costs and the resultant capital available.  This capital shall be distributed on the basis to compensate TENP for its previous efforts and to be deployed by FTS to enhance its business plan.

D: FTS shall submit two performance benchmarks which constitute the backbone of the ultimate transference of equity ownership from TENP’s control persons to FTS and their designee and or nominee. The benchmarks shall comprise a date and general gross revenue figure based on FTS’s financials. The dates proposed are June 30, 2014, (with an allowance of 2 weeks after said date to provide FTS’s unaudited financials) and subsequently 2 months after, on August 31, 2014 (with an allowance of 2 weeks after said date to provide FTS’s unaudited financials). The performance benchmarks shall be: FTS gross revenue of four (4) million USD dollars at benchmark one and an additional two (2) million USD in gross revenue, totaling six (6) million USD, for benchmark two. At each benchmark, whereby FTS meets or exceeds the target, additional equity shall be transferred to FTS and reduced from TENP; meeting target one shall result in both parties having an equal percentage of equity each; meeting target two shall resulting in FTS holding 65% and TENP holding 35%.

E: In the event that a target is not met and defaulted upon, TENP shall have the exclusive right to extend or terminate the SEA at its sole discretion.  If a termination of the SEA is elected by TENP, both parties agree that within 7 calendar days the terms and conditions set forth in the EA regarding a termination or default event shall be met and facilitated by the Escrow Agent.

 

F: In the event that benchmark one, being four (4) million USD in gross revenue, shall be exceeded by a percentage of 35%, both parties shall forego the need to meet benchmark two.  This will cause the terms of the SEA to be met and the final transference of equity to result in FTS holding 65% and TENP holding 35%.

7)

Both Parties acknowledge that in order to facilitate the SEA TENP will need to implement additional capital structure modifications which may include but are not limited to the constitution of specific Preferred Stock classes. The intent of such classes of Preferred Stock shall be to facilitate the equity transference pursuant to the SEA, the protection of current specific shareholders, the ability to settle current liabilities to equity and to create the possible structure for future acquisitions and dividend payments.

 

The parties agree that the remedy of any party at law for any actual or threatened breach of this LOI or definitive Share Exchange Agreement, if any, would be inadequate and that, in the event of such actual or threatened breach, in addition to any other remedy available to it, such party shall be entitled to specific performance hereof, injunctive relief, or both, by temporary or permanent injunction or other appropriate judicial remedy, writ or order.

Each party agrees that if it commits a breach, or threatens to commit a breach, of any of the provisions of this LOI or definitive agreement, if any, then the other party has the right to have the provisions of this LOI or definitive agreement, if any, specifically enforced by any court having jurisdiction, it being acknowledged and agreed that any such breach or threatened breach will cause irreparable injury to the other and that money damages will not provide an adequate remedy. If a breach occurs and is not wholly remedied by specific enforcement of this LOI or definitive agreement, if any, the offending party agrees to compensate injured party for any adverse consequences that result directly or indirectly from the breach.

The signatures of the parties on this document indicate that the general framework of the relationship has been accepted and that they are prepared to proceed with the transaction and enter a more detailed definitive agreement based on the terms and conditions of this LOI.   Both parties understand and agree that a definitive agreement shall contain such further and other provisions as is necessary in each of their respective opinions and as they shall mutually agree upon.

 

NEITHER PARTY SHALL NOT BE LIABLE FOR ANY INDIRECT, INCIDENTAL, SPECIAL OR CONSEQUENTIAL DAMAGES, IN CONNECTION WITH OR ARISING FROM THE PERFORMANCE OR USE OF THE PRODUCT(S) OR SERVICES PROVIDED OR REFERRED TO HEREIN, EXCEPT THOSE PROVISIONS RELATING TO IP AND CONFIDENTIALITY.