Document:

Binding Letter of Intent for the Acquisition of Third Bench Holdings LLC

  EXHIBIT 10.1
  
 NEW AMERICA ENERGY, CORP.
 240 Vaughan Drive
 Alpharetta GA  30009
  
 June 21, 2021
  
 Third Bench Holdings, LLC
 175 S. Main Street #1410
 Salt Lake City, UT 84111
  
 	 Attention:
	 Mr. David Fair

	  
	 Chief Executive Officer

  
 Re:Binding Letter of Intent for the Acquisition of Third Bench Holdings LLC 
  
 Dear Mr. Fair:
  
 We are writing to set forth certain of the principal terms and conditions on and subject to which New America Energy, Corp., or its affiliates (the “Company”) proposes to enter into a transaction with Third Bench Holdings, LLC (“Holdings”) and the members of Holdings (collectively, the “Members”), pursuant to which the Company and/or its affiliate will acquire majority ownership of Holdings from the Members as set forth herein.
  
 The basic terms and conditions proposed by the Company and to be incorporated into definitive agreements will include, but not be limited to, the following:
  
 1. Description of Acquisition Agreement. The Company (or its affiliate) will acquire all of the issued and outstanding equity of Holdings from the Members (the “Acquisition”).  In consideration for the Acquisition, the Members shall receive shares of a new series of Preferred Stock of the Company which rights and preferences, collectively, shall include: (i) conversion rights into that number of shares of common stock of the Company which shall equal Ninety Percent (90%) of the total issued and outstanding common stock of the Company as determined at the consummation of the Acquisition (“Underlying Common Stock”) on a fully diluted basis for a period of one year; and (ii) voting rights, in all matters, together with the Members of common stock of the Company with the numbers of votes equal to the number of shares of Underlying Common Stock.
  
 Pursuant to the terms of the Acquisition, the current officers and directors of the Company shall, at the closing of the Acquisition, resign and appoint the officers and directors as directed by Holdings. The current CEO, Jeffrey M. Canouse, will be retained for a period of three (3) months to assist in the transition at a monthly salary rate of $5,000 (USD) per month. This retention can be extended upon mutual agreement between Jeffrey Canouse and the Company.
  
 All of the terms of the Acquisition including the Initial Financing (as defined forth herein) shall be set forth in a definitive acquisition agreement (the “Acquisition Agreement”) which shall be negotiated between the Company and the Members.
  
 2. Financing Transaction.  At the consummation of the Acquisition (the “Closing”), the Company will consummate a bridge financing for the benefit of Holdings in an amount of (US$500,000.) and such funds shall be utilized, in part, to pay for the expenses incurred in connection with the Acquisition and the Audit.  Following the Closing, the Company will raise up to Ten Million dollars (US$10,000,000) by the sale of shares of equity (common stock or preferred stock) or debt of the Company (the “Initial Financing”). It is anticipated that the Initial Financing will be consummated in tranches over the twelve (12) months following the Closing.
  
 3.  Southridge. At the Closing, Southridge (or its affiliates as directed by Southridge) shall receive shares of a new series of Preferred Stock of the Company which, collectively, shall be convertible into that number of shares of common stock of the Company which shall equal Five Percent (5%) of the total issued and outstanding common 
 
  
 
 
 stock of the Company as determined at the consummation of the Acquisition (on a fully diluted basis for a period of one year) and carry ratchet and anti-dilution rights.
  
 4.  Control Block. At the closing, Jeffrey Canouse, will assign 100% of  the Preferred A Shares that he currently owns in exchange for shares of Series B Preferred Stock to be issued to Jeffrey M. Canouse  (or his affiliates and/or designees as directed by Jeffrey Canouse) of the Company which, collectively, shall be convertible into that number of shares of common stock of the Company which shall equal Three Percent (3%) of the total issued and outstanding common stock of the Company as determined at the consummation of the Acquisition (on a fully diluted basis for a period of two (2) years) and carry ratchet and anti-dilution rights.
  
 5.  Accuracy of financial statements.  The terms set forth in this letter are based on the parties' assumption that Holdings’ balance sheets, income statements and statements of cash flows for the fiscal years ending December 31, 2018 and December 31, 2019 (and December 31, 2020 when available), have been (will be) prepared in accordance with generally accepted accounting principles consistently applied and that such financial statements fairly represent Holdings’ financial condition at that time and the results of its operations for that period; and prior to the closing of the Acquisition, any necessary audit(s) of Holdings (the “Holdings Audits”) shall be performed and completed by an auditing firm as selected by the Company.
  
 6.  Customary terms and conditions.  All terms and conditions concerning the Acquisition (collectively, the “Transaction”) will be stated in one or more definitive agreements, including but not limited to the Acquisition Agreement, subject to the approval of the parties, acting on advice of counsel. The terms and conditions will be usual and customary in a transaction of this nature and mutually acceptable to the parties.
  
 7.  Closing Conditions.
  
 a.  the Members’ closing of the Transaction is conditioned upon:
  
 (i)  The Members’ satisfaction with the results of the legal, accounting and business due diligence investigation of the Company to be performed by Holdings’ attorneys, accountants and representatives;
  
 (ii)  negotiation and execution of a definitive agreements (including but not limited to the Acquisition Agreement) and any ancillary documents carrying out the terms of the Transaction as set forth therein, respectively;
  
 (iii)  obtaining of all necessary and material governmental and third-party consents and approvals; and
  
 (iv)  absence of any material adverse change in the Company’s or any of its subsidiaries or affiliates condition, assets operation or business prospects.
  
 (v)  confirmation by the Company that at the time of the merger the amount of debt held by the Company will be less than US $3,000,000 .
  
 b.  the Company’s closing of the transaction is conditioned upon:
  
 (i)  the Company’s satisfaction with the results of the legal, accounting and business due diligence investigation of Holdings and the Members to be performed by their attorneys, accountants and representatives;
  
 (ii)  negotiation and execution of a definitive agreements (including but not limited to the Acquisition Agreement) and any ancillary documents carrying out the terms of the Transaction as set forth therein, respectively;
  
 (iii)  obtaining of all necessary and material governmental and third-party consents and approvals;
 
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 (iv)  delivery of the Holdings Audits; and
  
 (v)  absence of any material adverse change in Holdings’ condition, assets operation or business prospects.
  
 7.  Confidentiality.  Each party hereto will permit each other party and their attorney, accountants and representatives to conduct an investigation and evaluation of such other party, will provide such assistance as is reasonably requested and will give access at reasonable times to all things related to the business, personnel and assets of such other party.  If the contemplated transaction is not consummated, each party hereto will not, nor will it permit any of its employees, agents or representatives to, use or disclose to any third party (except to the extent required by law or judicial process or publicly available or obtainable, from independent sources not subject to a confidentiality agreement or required by law) any information obtained in their investigation of the other party.
  
 8.  Conduct of Business.  During the period from the date hereof to the closing of the transactions contemplated herein: (a) Holdings’ business will be carried on in accordance with all applicable laws, rules and regulations (the violation of which would have a material adverse effect on a party or any significant portion of its business) and in a manner consistent with past customs and practices; (b) Holdings agrees to conduct its business in the ordinary course; (c) Holdings will not issue, redeem, purchase or otherwise acquire, directly or indirectly any of its outstanding equity (other than as contemplated by the terms as set forth herein); and (d) the parties will not take, or permit any of its subsidiaries, if any, to take, any action which would, or which might reasonably be expected to, hinder the Transaction or render it less desirable.
  
 9.  Binding Nature/Exclusivity.  Due to the binding nature of this Letter of Intent, the Company, the Members and Holdings agrees that, until the earlier of the execution of the Acquisition Agreement or sixty (60) days from the date hereof, the Members, Holdings and its affiliates, directors, representatives, employees or agents will not directly or indirectly: (i) solicit, encourage or discuss a sale of all or any substantial part of Holdings  or its assets or a sale of any equity or debt security of Holdings or any subsidiary, or any merger, consolidation, liquidation, dissolution, recapitalization, reorganization, or similar transaction involving Holdings or any subsidiary with any other party (all of the foregoing are collectively referred to as “Acquisition Proposals”) (except as required in connection with its fiduciary duties), or (ii) provide any information regarding Holdings to any third party (other than information which is traditionally provided in the regular course of its business operations to third parties where they have no reason to believe that such information may be used to evaluate an Acquisition Proposal and information required to be delivered by legal process). The Members and Holdings (and its affiliates, directors, representatives, employees and agents) will immediately cease and cause to be terminated any and all contacts, discussions and negotiations with third parties regarding any Acquisition Proposal and will promptly notify the Company if any Acquisition Proposal, or any inquiry or contact with any person or any entity with respect thereto, is made.
  
 10.  Transaction Expenses.  The Members, the Company and Holdings will each pay its own respective transaction expenses in connection with the transactions contemplated hereby, including, but not limited to, fees and expenses of legal counsel or other representatives and consultants and all other fees and expenses.
  
 It is understood that this letter merely constitutes a non binding statement of our mutual intentions, does not contain all matters upon which agreement must be reached for the Transaction to be consummated and, therefore, does not constitute a binding and enforceable commitment with respect to matters covered by this letter (including the Transaction). A binding and enforceable commitment with respect to matters covered by this letter (including the Transaction) will result only from the execution of the definitive agreements, subject to the conditions expressed therein. Notwithstanding the two preceding sentences of this Section, upon acceptance hereof as described below, the provisions of Sections 7, 8, 9 and 10 shall be legally binding upon and enforceable against Holdings, the Members and the Company.
  
  
 SIGNATURE PAGE FOLLOWS
 
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 If the foregoing Binding Letter of Intent accurately sets forth our mutual intentions with respect to the principal terms of the proposed Transaction, please sign below and return a copy of this letter to the undersigned.
  
 Very truly yours,
  
 NEW AMERICA ENERGY, CORP.
  
 By: /s/ Jeffrey Canouse
 Jeffrey Canouse
 Chief Executive Officer
  
  
 Agreed and Accepted
 as of June 21, 2021:
  
 Third Bench Holdings LLC
  
 By: /s/ David Fair
 David Fair
 Chief Executive Officer
  
 THE MEMBERS:
  
 ____________________________
 [Name]
  
 ____________________________
 [Name]
  
 ____________________________
 [Name]
  
 ____________________________
 [Name]
  
  
  
  
  
  
  
  
  
  
  
  
 
 4Document

DESCRIPTION OF CAPITAL STOCK

             The following statements contain, in summary form, certain information relating to the capital stock of the Company.  They do not purport to be complete, and are qualified in their entirety by reference to the provisions of the Company's Second Restatement of the Restated and Amended Articles of Incorporation, as amended (the "Restated Articles") incorporated herein by this reference. 

             The authorized capital stock of the Company consists of 120,000,000 shares of Common Stock, no par value (the “Common Stock”), and 1,000,000 shares of Preferred Stock, no par value (the "Preferred Stock") of which 250,000 shares have been designated as Series A Serial Preferred Stock.  No shares of Preferred Stock have been issued.  The Company’s Restated Articles do not authorize any other classes of capital stock.

The Common Stock is the only class of capital stock of the Company registered under the Securities Exchange Act of 1934 as amended and it is registered under Section 12(b) thereof.   

COMMON STOCK

            All issued and outstanding shares of Common Stock are duly authorized, validly issued, fully paid, and non-assessable.  Holders of Common Stock have one vote for each share held and are not entitled to cumulate their votes for the election of directors.  Until January 1, 2019, under the Iowa Business Corporation Act, the Board was required to be classified.  However, starting with the company’s 2019 annual shareholders’ meeting, Iowa Code section 490.806B mandates that the board begin a phased declassification over a three-year period.  In particular, Iowa Code section 490.806B requires that the staggered terms of the “Class I”, “Class II” and “Class III” directors elected or appointed prior to January 1, 2019 cease at the expiration of their then current terms, and that the terms of directors elected or appointed after January 1, 2019 expire at the next annual shareholders’ meeting following their election or appointment.

Common Stock is not subject to redemption by its terms although Common Stock may be repurchased by the Company at its discretion.  The holders of shares of Common Stock do not have preemptive rights.  Holders of shares of Common Stock are entitled to share ratably in the assets of the Company legally available for distribution to holders of Common Stock in the event of liquidation, dissolution, or winding up of the Company.  The holders of Common Stock are entitled to dividends when, as and if declared by the Board of Directors of the Company.

PREFERRED STOCK

             The Board of Directors is empowered by the Restated Articles to issue, from time to time, one or more series of authorized Preferred Stock without shareholder approval. The authorized but unissued shares of Preferred Stock may be issued in series having such designations, preferences or rights, and having the qualifications, limitations or restrictions thereon, as may be fixed and determined by resolution of the Company's Board of Directors. Therefore, shares of 

series of Preferred Stock could have rights that would cause such shares to be superior to the Common Stock with respect to such matters as voting, dividends and liquidation.

    As noted above, the Restated Articles authorize a series of Preferred Stock designated Series A Serial Preferred Stock comprised of 250,000 shares.  The Board created the Series A Serial Preferred Stock in April 2010 in connection with the Shareholder Rights Plan (the “Rights Plan”) that it adopted at the same time.  The Series A Serial Preferred Stock was created having the specific designations, preferences and rights and having the specific qualifications, limitations and restrictions necessary to implement the Rights Plan.  The Shareholder Rights Plan expired in April 2011 without any shares of Series A Preferred Stock having been issued.  The 250,000 Series A Serial Preferred Stock remains authorized under the Restated Articles. Since the Rights Plan is expired, the Board does not anticipate issuing the Series A Serial Preferred Stock for which it was created.    

REGISTRAR AND TRANSFER AGENT

Computershare Trust Company, N.A. 250 Royall Street Canton, MA 02021 is the Registrar and Transfer Agent for the Common Stock of the Company.

CERTAIN PROVISIONS OF THE IOWA CODE, OUR ARTICLES OF INCORPORATION AND BYLAWS

Certain provisions of the Iowa Business Corporations Act (the “Act”), our Restated Articles and the Sixth Amended and Restated By-Laws (the “Bylaws”) summarized in the following paragraphs may have an anti-takeover effect. This summary is qualified in its entirety by reference to the Restated Articles, and the Bylaws incorporated herein by this reference.   

Our Bylaws vest the power to call special meetings of stockholders in our board chair, by resolution approved by a majority of the entire board, or by the secretary of the Company following receipt of one or more written demands to call a special meeting of the shareholders from shareholders holding of record shares representing not less than 50% of the voting power of the outstanding shares of the Company.  Shareholders are permitted under our Bylaws to act by written consent in lieu of a meeting.

To be properly brought before an annual meeting of stockholders, any shareholder proposal or nomination for the board of directors must be delivered to our secretary by the close of business not more than 120 and not less than 90 days prior to the date on which we first mailed our proxy materials for the prior year’s annual meeting; provided that in the event that the date of the annual meeting is advanced by more than 30 days or delayed by more than 60 days from the anniversary of the previous year’s meeting, written notice must be provided not less than 90 days nor more than 120 days prior to the date of the annual meeting or, if the first public announcement of the date of such advanced or delayed annual meeting is less than 100 days prior to the date of such annual meeting, the 10th day following the day on which public announcement of the date of the annual meeting is first made.

Our Bylaws contain “proxy access” provisions, which permit an eligible shareholder or a group of up to 20 eligible shareholders owning 3% or more of the Company’s outstanding shares of Common Stock continuously for at least three years to nominate and include in the Company’s annual meeting proxy materials, for any annual meeting of shareholders at which directors are to be elected, director nominees constituting up to the greater of (i) 20% of the total number of directors of the Company, or (ii) two individuals; provided that the nominating shareholder(s) and nominee(s) satisfy the requirements described in the Bylaws.

As noted above, the classified board is being phased out under “Common Stock”.

We are subject to Iowa Code section 490.1110 (“Section 490.1110”). In general, Section 490.1110 prohibits a publicly held Iowa corporation from engaging in various “business combination” transactions with any interested shareholder for a period of three years following the date of the transactions in which the person became an interested shareholder, unless: (i) the transaction is approved by the board of directors prior to the date the shareholder became and interested shareholder; (ii) upon consummation of the transaction which resulted in the shareholder becoming an interested shareholder, the interested shareholder owned at least 85% of the voting stock of the corporation outstanding at the time the transaction commenced; or (iii) on or subsequent to such date the business combination is approved by the board of directors and authorized at an annual or special meeting of shareholders by the affirmative vote of at least 66 2/3% of the outstanding voting stock which is not owned by the interested shareholder.

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