THIS TERMINATION AGREEMENT
(this “Agreement”
) is made as of June 30, 2008 (the “Effective
Date” ), by and among QUEPASA CORPORATION , a
Nevada corporation (together with its subsidiaries, “
Quepasa ”), MEXICANS & AMERICANS THINKING
TOGETHER FOUNDATION, INC. , a Delaware not-for-profit
corporation ( “MATTF” ), and MEXICANS &
AMERICANS TRADING TOGETHER, INC. , a Delaware corporation (
“MATT” ) (each a “Party” and
collectively the “Parties” ).
WHEREAS , the Parties are parties to that certain
Corporate Sponsorship and Management Services Agreement dated as of
November 20, 2006 (the “Services Agreement”
);
WHEREAS , pursuant to the Services Agreement, Quepasa
owes MATTF the sum of $7,556,052 (the
“Indebtedness” );
WHEREAS , Quepasa desires to issue to MATTF, and MATTF
desires to accept from Quepasa, preferred stock of Quepasa in
consideration for MATTF’s cancellation of the Indebtedness,
upon the terms and subject to the conditions set forth
herein;
WHEREAS , the Parties hereby agree to waive all rights
granted to them under the Services Agreement and to terminate the
Services Agreement in its entirety, subject to the terms and
conditions of this Agreement, including the survival of the
Surviving Provisions (defined below);
NOW, THEREFORE , in consideration of the mutual covenants
contained in this Agreement and for other good and valuable
consideration, the receipt and adequacy of which are hereby
acknowledged, the Parties hereby agree as follows:
1. Agreement to Sell and Purchase .
Quepasa hereby issues, transfers, sells, assigns, grants and
conveys to MATTF and MATTF agrees to accept and purchase from
Quepasa, 25,000 shares of Series A Preferred Stock, par value
$0.001 per share, of Quepasa (the “Preferred
Stock” ) in exchange for the Parties termination of the
Services Agreement (other than the Survival Provisions),
cancellation of the Indebtedness, and the waiver and releases set
forth herein in accordance with the terms and subject to the
conditions set forth in this Agreement. The Preferred Stock has the
rights and preferences set forth in the certificate of designation
attached hereto as Exhibit A (the “Certificate
of Designation” ) and shall have the registration rights
set forth on the form registration rights agreement attached hereto
as Exhibit B (the “Registration Rights
Agreement” and together with the Certificate of
Designation, the “Ancillary Documents”
).
2. Termination of the Services
Agreement . Any and all rights granted to the Parties pursuant
to the Services Agreement shall be terminated, any post-termination
rights or obligations which would otherwise survive termination are
hereby terminated and the Services Agreement is hereby terminated,
null and void and of no effect whatsoever; provided that
Sections 2.3(b), 2.3(c), 2.3(d), 6, 8.3(d), 8.3(e), 13 and 15
of the Services Agreement shall survive such termination and the
Parties shall continue to have the rights and obligations under
such Sections (such Sections collectively, the “ Surviving
Provisions ”). The Parties hereby consent to the
termination of the Services Agreement as provided
herein.
3. Waiver of Rights under the Services
Agreement. The Parties hereby waive any and all rights granted
to, or accrued by, them pursuant to the Services Agreement, other
than the rights under the Surviving Provisions.
(a) MATT and MATTF, in consideration of
good and valuable consideration received and to be received from
Quepasa hereunder, the sufficiency of which is acknowledged, each
releases and discharges Quepasa, its subsidiaries and affiliates
and its and their respective officers, directors, shareholders,
employees, agents, attorneys and affiliates and its and their
respective heirs, personal representatives, successors and assigns
(collectively, the “Quepasa Releasees” ), of and
from all claims, demands, causes of action, suits, actions,
proceedings, judgments, debts, damages, liabilities and
obligations, at law, equity or otherwise, which MATT or MATTF or
any of its affiliates and any of their respective successors or
assigns had, have or may hereafter have against the Quepasa
Releasees arising under the Services Agreement from the beginning
of the world to the Effective Date other than the claims, demands,
causes of action, suits, actions, proceedings, judgments, debts,
damages and liabilities arising the Surviving Provisions; except
that, MATT and MATTF in no way release or discharge Quepasa’s
obligations under this Agreement or the Ancillary Documents.
Nothing herein shall be construed as an admission by Quepasa that
MATT or MATTF has any claim against it. MATT and MATTF and their
respective successors and assigns, further waive any and all manner
of notice, knowledge or discovery of any and all such actual or
alleged claims of cause of action.
(b) Quepasa, in consideration of good and
valuable consideration received and to be received from MATT and
MATTF hereunder, the sufficiency of which is acknowledged, releases
and discharges MATT and MATTF and its and their subsidiaries and
affiliates and its and their respective officers, directors,
shareholders, employees, agents, attorneys and affiliates and its
and their respective heirs, personal representatives, successors
and assigns (together, the “MATT/MATTF
Releasees” ), of and from all claims, demands, causes of
action, suits, actions, proceedings, judgments, debts, damages,
liabilities and obligations, at law, equity or otherwise, which
Quepasa or any of its affiliates and any of their respective
successors or assigns had, have or may hereafter have against the
MATT/MATTF Releasees arising under the Services Agreement from the
beginning of the world to the Effective Date other than the claims,
demands, causes of action, suits, actions, proceedings, judgments,
debts, damages and liabilities arising under the Surviving
Provisions; except that, Quepasa in no way releases or discharges
MATT’s or MATTF’s obligations under this Agreement or
the Ancillary Agreements. Nothing herein shall be construed as an
admission by MATT or MATTF that Quepasa has any claim against it or
them. Quepasa, its affiliates and their respective successors and
assigns, further waive any and all manner of notice, knowledge or
discovery of any and all such actual or alleged claims of cause of
action.
5. Representations and Warranties of
Quepasa . Quepasa hereby represents and warrants that the
following statements are true and correct as of the Effective Date
and hereby acknowledges and confirms that MATT and MATTF are
relying on such representations and warranties in connection with
entering into this Agreement and the Registration Rights
Agreement:
2
(a) Organization of Quepasa .
Quepasa is a corporation duly organized, validly existing, and in
good standing under the laws of the State of Nevada and has all
requisite corporate power and authority to carry on its business as
presently conducted. Quepasa is duly qualified to transact business
and is in good standing in each jurisdiction in which the failure
to so qualify would have a Material Adverse Effect. For purposes of
this Agreement, “ Material Adverse Effect ”
means a material adverse effect on the business, property,
liabilities, condition (financial or otherwise), assets, operations
or results of operations of Quepasa, taken as a whole, including
(i) any event that may reasonably cause the delisting of
trading of the Quepasa’s common stock on the Nasdaq Stock
Market and (ii) the existence, threat or facts that could give
rise to any Securities and Exchange Commission investigation
relating to Quepasa.
(b) Authorization of Transaction .
Quepasa has the requisite corporate power and authority to execute
and deliver this Agreement and the Ancillary Documents, to perform
its obligations hereunder and thereunder and to consummate the
transactions contemplated hereby and thereby. The execution and
delivery of this Agreement and the Ancillary Documents and the
consummation of the transactions contemplated hereby and thereby,
including the authorization, issuance, sale and delivery of the
Preferred Stock and the common stock issuable upon conversion
thereof, have been duly authorized by all necessary corporate
action on the part of Quepasa and its directors and stockholders.
This Agreement and the Ancillary Documents have been duly executed
and delivered by Quepasa and constitute the valid and legally
binding obligations of Quepasa, enforceable in accordance with its
and their terms and conditions.
(c) Noncontravention; Consents .
Neither the execution and the delivery of this Agreement nor any of
the Ancillary Documents, nor the consummation of the transactions
contemplated hereby and thereby, will (with or without notice or
the lapse of time) (i) violate any constitution, statute,
regulation, rule, injunction, judgment, order, decree, ruling,
charge, or other restriction of any government, governmental
agency, or court to which Quepasa is subject or any provision of
the charter or bylaws of Quepasa, (ii) violate any applicable
rule, regulation or interpretative memorandum of any applicable
national securities exchange (including the Nasdaq Stock Market),
or (iii) conflict with, result in a breach of, constitute a
default under, result in the acceleration of, create in any party
the right to accelerate, terminate, modify, or cancel any
obligation under, result in the loss of a benefit under, or require
any notice under any agreement, contract, lease, license,
instrument, or other arrangement to which Quepasa is a party or by
which it is bound or to which any of its assets is subject or
result in the imposition of any security interest upon any of its
assets, except where the conflict, breach, default, acceleration,
termination, modification, cancellation, loss, failure to give
notice, or security interest would not have a Material Adverse
Effect on Quepasa or on the ability of the Parties to consummate
the transactions contemplated by this Agreement. No consent,
approval, order or authorization of, or registration, declaration
or filing with, any government, governmental agency, court or
national securities exchange (including the Nasdaq Stock Market) is
required by or with respect to Quepasa in connection with the
execution and delivery of this Agreement or any of the Ancillary
Documents or the consummation of the transactions contemplated
hereby and thereby, including the authorization, issuance, sale and
delivery of the Preferred Stock and the common stock issuable upon
conversion thereof.
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(d) Capitalization . The authorized
capital stock of Quepasa consists of 50,000,000 shares of common
stock, par value $0.001 per share, and 5,000,000 shares of
preferred stock, 25,000 of which have been designated Series A
Preferred Stock. There are no shares of preferred stock of Quepasa
outstanding, except the Preferred Stock to be issued at Closing.
There are no outstanding obligations, rights or agreements
entitling any person, firm or corporation or other entity to
acquire shares of preferred stock of Quepasa or any equity security
of Quepasa having any preference or priority as to dividends,
redemption or distribution of assets on liquidation, merger or
otherwise which is superior to or on parity with any such
preference or priority of the Preferred Stock. The Preferred Stock
has the powers, designations, preferences, limitations,
restrictions and rights s
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