-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Nqxc5v/itz7KkWbUlcYeVZ6uuhTp0yBdvSh/qEdNhVMFYYWZTsdVHzw5keMWEKX4 yHwfIN01dvWQ9Vkott8XdA== 0001075793-02-000445.txt : 20021015 0001075793-02-000445.hdr.sgml : 20021014 20021014165646 ACCESSION NUMBER: 0001075793-02-000445 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20021004 ITEM INFORMATION: Other events ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 20021015 FILER: COMPANY DATA: COMPANY CONFORMED NAME: THINKA WEIGHT LOSS CORP CENTRAL INDEX KEY: 0001107445 STANDARD INDUSTRIAL CLASSIFICATION: MINING, QUARRYING OF NONMETALLIC MINERALS (NO FUELS) [1400] STATE OF INCORPORATION: NV FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-32673 FILM NUMBER: 02788092 BUSINESS ADDRESS: STREET 1: 3110 EAST SUNSET ROAD, SUITE H1 CITY: LAS VEGAS STATE: NV BUSINESS PHONE: (800) 297-4450 MAIL ADDRESS: STREET 1: 3110 EAST SUNSET ROAD, SUITE H1 CITY: LAS VEGAS STATE: NV ZIP: 89120 FORMER COMPANY: FORMER CONFORMED NAME: ENCORE VENTURES INC DATE OF NAME CHANGE: 20000222 8-K 1 formeightk.txt ================================================================================ UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 OCTOBER 4, 2002 Date of Report (Date of earliest event reported) THINKA WEIGHT-LOSS CORPORATION (Exact name of registrant as specified in its charter) NEVADA 002-32673 98-0218912 ------ --------- ---------- (State or other jurisdiction (Commission File (IRS Employer of incorporation) Number) Identification No.) 3675 PECOS-MCLEOD, SUITE 1400 LAS VEGAS, NEVADA 89121 ------------------- ----- (Address of principal executive offices) (Zip Code) 800-297-4450 Registrant's telephone number, including area code NOT APPLICABLE (Former name or former address, if changed since last report) ================================================================================ ITEM 1. CHANGES IN CONTROL OF REGISTRANT None. ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS None. ITEM 3. BANKRUPTCY OR RECEIVERSHIP None. ITEM 4. CHANGES IN REGISTRANT'S CERTIFYING ACCOUNTANT None. ITEM 5. OTHER EVENTS AND REGULATION FD DISCLOSURE The Registrant entered into an agreement dated October 4, 2002 (the "Agreement") to acquire from Flax-Flex Fabricators, Ltd. and Ron Robertson (the "Vendors") a total of 5,600,000 shares (the "Transworld Shares") of Transworld Benefits, Inc. ("Transworld") representing 100% of the issued and outstanding shares of Transworld. Under the terms of the Agreement the Registrant will issue at closing 4,500,000 restricted common shares to the Vendors in exchange for the Transworld Shares. Closing of the acquisition is subject to a number of conditions including completion of necessary financial statements and the Registrant completing a debt or equity financing to raise at least $500,000. Closing must take place within 90 days of the date of the agreement but may be earlier if all conditions of closing have been met. The Registrant also intends to change its name to reflect its new business direction as soon as possible following closing. Transworld has developed a unique proprietary emergency travel assistance benefits package. Transworld's "Above and Beyond" service product, provides valuable assistance for travellers in cases of injury or death. As a major component of the service, Transworld will maintain exclusive relationships with a vast network of private executive aircraft. Target industries for Above and Beyond services include funeral, insurance travel and credit card providers, as well as private associations. Transworld is headquartered in Irvine, California. Shareholders and employees of Transworld have also entered into an agreement dated for reference September 24, 2002 and executed October 7, 2002 (the "Share Transfer Agreement") for the purchase of 5,300,000 restricted common shares of the Registrant from Farline Venture Corporation and William Iny. Closing of the Share Transfer Agreement is subject to closing of the acquisition of the Transworld Shares described above. ITEM 6. RESIGNATIONS OF REGISTRANT'S DIRECTORS None. 2 ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS (a) Financial Statements of Business Acquired. None. (b) Pro forma Financial Information. None. (c) Exhibits. Exhibit Description - ------- ----------------------------------------------------- 10.1 Share Purchase Agreement dated October 4, 2002. 10.2 Agreement dated for reference September 24, 2002 among Flax- Flex Fabricators, Ltd., Ron Robertson, Farline Venture Corporation and William Iny. ITEM 8. CHANGE IN FISCAL YEAR None. ITEM 9. REGULATION FD DISCLOSURE None. 3 SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. THINKA WEIGHT-LOSS CORPORATION Date: OCTOBER 4, 2002 --- By: /s/ Kathy Whyte --------------------------- KATHY WHYTE SECRETARY EX-10 3 exfiveonespa.txt SHARE PURCHASE AGREEMENT -------------------------- THIS AGREEMENT is made as of the 4th day of October, 2002. AMONG: THE UNDERSIGNED SHAREHOLDERS OF TRANSWORLD BENEFITS INC. (hereinafter called the "Vendors") OF THE FIRST PART AND: THINKA WEIGHT LOSS CORPORATION, of ------------------------------ 3675 Pecos-McLeod, Suite 1400 Las Vegas, Nevada 89121 (hereinafter called the "Purchaser") OF THE SECOND PART AND: TRANSWORLD BENEFITS INC. of ----------------------- 20516 Claremont Avenue Riverside, California 92507 (hereinafter called the "Company") OF THE THIRD PART WHEREAS: A. The Purchaser has offered to purchase all of the issued and outstanding shares of the Company; B. The Vendors have each severally agreed to sell to the Purchaser all of the issued and outstanding shares of the Company held by each such Vendor on the terms and conditions set forth herein; C. The parties intend that the Purchaser's acquisition of the Company from the Vendors qualify as a tax-free reorganization within the meaning of Section 368 of the Internal Revenue Code of 1986, as amended, and shall modify the transaction contemplated herein as may be necessary to 1 conform to the requirements of Section 368, provided such modifications are consistent with the basis of the bargain of this Agreement. D. In order to record the terms and conditions of the agreement among them the parties wish to enter into this agreement; NOW THEREFORE THIS AGREEMENT WITNESSES that in consideration of the foregoing and of the sum of $1.00 paid by the Purchaser to each of the Vendors and to the Company, the receipt of which is hereby acknowledged, the parties hereto agree each with the other as follows: 1. INTERPRETATION -------------- 1.1 Where used herein or in any amendments or Schedules hereto, the following terms shall have the following meanings: (a) "Business" means the business in which the Company is engaged, namely: (i) the sale of contracts for emergency assistance for travellers on worldwide basis; (ii) any other enterprise that is directly related to the foregoing; (b) "Closing Date" means that business day on which the Purchaser completes that private or public financing referred to in Article 5 or such other date as may be mutually agreed upon by the parties hereto but in any event not more than 90 days from the date of this agreement; (c) "Company Financial Statements" means those financial statements of the Company as at April 30, 2002, and those financial statements of the Company prepared by management as at August 31, 2002, both of which are attached hereto as Schedule "A"; (d) "Company Shares" means the 5,600,000 common shares in the capital of the Company held by the Vendors, being all of the issued and outstanding shares of the Company; (e) "Purchaser Financial Statements" means those draft unaudited financial statements of the Purchaser as at June 30, 2002 attached hereto as Schedule "B"; (f) "Purchaser Shares" means those fully paid and non-assessable post-consolidated common shares of the Purchaser to be issued to the Vendors by the Purchaser pursuant to this agreement. 1.2 All dollar amounts referred to in this agreement are in United States funds, unless expressly stated otherwise. 2 1.3 The following schedules are attached to and form part of this agreement: Schedule A - Company Financial Statements Schedule B - Purchaser Financial Statements Schedule C - Employment, Service & Pension Agreements of the Company Schedule D - Real Property & Leases of the Company Schedule E - Encumbrances on the Company's Assets Schedule F - Company Litigation Schedule G - Purchaser Litigation Schedule H - Registered Trademarks, Trade Names & Patents of the Company 2. SHARE EXCHANGE AND PURCHASE OF SHARES ------------------------------------------ 2.1 The Vendors each hereby covenant and agree to sell, assign and transfer to the Purchaser, and the Purchaser covenants and agrees to purchase from each of the Vendors the Company Shares held by each Vendor. 2.2 As consideration for the sale of the Company Shares, the Purchaser shall allot and issue to the Vendors the Purchaser Shares. 2.3 The total number of Purchaser Shares to be allotted and issued to the Vendors shall be 4,500,000 shares. 2.4 The Purchaser Shares shall be allotted and issued to the Vendors in the following proportions: -------------------------------------------------------------- Approximate Percentage of Total Number of Purchaser Vendor Purchaser Shares Shares -------------------------------------------------------------- Flax-Flex Fabricators, Ltd. 4,467,000 99.3 -------------------------------------------------------------- Ron Robertson 33,000 0.7 -------------------------------------------------------------- 3 3. COVENANTS, REPRESENTATIONS AND WARRANTIES OF THE VENDORS AND THE COMPANY ----------------------------------- The Vendors and the Company jointly and severally covenant with and represent and warrant to the Purchaser as follows, and acknowledge that the Purchaser is relying upon such covenants, representations and warranties in connection with the purchase by the Purchaser of the Company Shares: 3.1 The Company has been duly incorporated and organized, is validly existing and is in good standing under the laws of Nevada; it has the corporate power to own or lease its property and to carry on the Business; it is duly qualified as a corporation to do business and is in good standing with respect thereto in each jurisdiction in which the nature of the Business or the property owned or leased by it makes such qualification necessary; and it has all necessary licenses, permits, authorizations and consents to operate its Business in accordance with the terms of its business plan. 3.2 The authorized capital of the Company consists of 10,000,000 shares, of which 5,600,000 of such shares have been duly issued and are outstanding as fully paid and non-assessable. 3.3 The Company Shares owned by the Vendors are owned by them as the beneficial and recorded owners with a good and marketable title thereto, free and clear of all mortgages, liens, charges, security interests, adverse claims, pledges, encumbrances and demands whatsoever as follows: Number of Approximate Company Percentage of Issued Name of Principal Shareholder Shares Company Shares - -------------------------------------------------------------------------- Flax-Flex Fabricators, Ltd. 5,560,000 99.3 Ron Robertson 40,000 0.7 3.4 No person, firm or corporation has any agreement or option or any right or privilege (whether by law, pre-emptive or contractual) capable of becoming an agreement or option for the purchase from the Vendors of any of the Company Shares held by any of them. 3.5 No person, firm or corporation has any agreement or option, including convertible securities, warrants or convertible obligations of any nature, or any right or privilege (whether by law, pre-emptive or contractual) capable of becoming an agreement or option for the purchase, subscription, allotment or issuance of any of the unissued shares in the capital of the Company or of any securities of the Company. 3.6 The Company does not have any subsidiaries or agreements of any nature to acquire any subsidiary or to acquire or lease any other business operations and will not prior to the Closing Date acquire, or agree to acquire, any subsidiary or business without the prior written consent of the Purchaser. 4 3.7 The Company will not, without the prior written consent of the Purchaser, issue any additional shares from and after the date hereof to the Closing Date or create any options, warrants or rights for any person to subscribe for or acquire any unissued shares in the capital of the Company. 3.8 The Company is not a party to or bound by any guarantee, warranty, indemnification, assumption or endorsement or any other like commitment of the obligations, liabilities (contingent or otherwise) or indebtedness of any other person, firm or corporation. 3.9 The books and records of the Company fairly and correctly set out and disclose in all material respects, in accordance with generally accepted accounting principles, the financial position of the Company as at the date hereof, and all material financial transactions of the Company relating to the Business have been accurately recorded in such books and records. 3.10 The Company Financial Statements present fairly the assets, liabilities (whether accrued, absolute, contingent or otherwise) and the financial condition of the Company as at the date thereof and there will not be, prior to the Closing Date, any increase in such liabilities. 3.11 (a) The entering into of this agreement and the consummation of the transactions contemplated hereby will not result in the violation of any of the terms and provisions of the constating documents or bylaws of the Company or of any indenture, instrument or agreement, written or oral, to which the Company or the Vendors may be a party; (b) The entering into of this agreement and the consummation of the transactions contemplated hereby will not, to the best of the knowledge of the Company and the Vendors, result in the violation of any law or regulation of Nevada or of any states in which they are resident or in which the Business is or at the Closing Date will be carried on or of any municipal bylaw or ordinance to which the Company or the Business may be subject; (c) This agreement has been duly authorized, validly executed and delivered by the Company and the Vendors. 3.12 The Business has been carried on in the ordinary and normal course by the Company since the date of the Company Financial Statements and will be carried on by the Company in the ordinary and normal course after the date hereof and up to the Closing Date. 3.13 Except in connection with the real property leases described on Schedule D hereto, no capital expenditures in excess of $5,000 have been made or authorized by the Company since the date of the Company Financial Statements and no capital expenditures in excess of $5,000 will be made or authorized by the Company after the date hereof and up to the Closing Date without the prior written consent of the Purchaser. 5 3.14 Except as disclosed in the Schedules hereto, the Company is not a party to any written or oral employment, service or pension agreement, and, the Company does not have any employees who cannot be dismissed on not more than one months notice without further liability. 3.15 Except as disclosed in the Schedules hereto, the Company does not have outstanding any bonds, debentures, mortgages, notes or other indebtedness, and the Company is not under any agreement to create or issue any bonds, debentures, mortgages, notes or other indebtedness, except liabilities incurred in the ordinary course of business. 3.16 Except as disclosed in the Schedules hereto, the Company is not the owner, lessee or under any agreement to own or lease any real property. 3.17 Except as disclosed in the Schedules hereto, the Company owns, possesses and has good and marketable title to its undertaking, property and assets, and without restricting the generality of the foregoing, all those assets described in the balance sheet included in the Company Financial Statements, free and clear of any and all mortgages, liens, pledges, charges, security interests, encumbrances, actions, claims or demands of any nature whatsoever or howsoever arising. 3.18 The Company has its property insured against loss or damage by all insurable hazards or risks on a replacement cost basis and such insurance coverage will be continued in full force and effect to and including the Closing Date; to the best of the knowledge of the Company and the Vendors, the Company is not in default with respect to any of the provisions contained in any such insurance policy and has not failed to give any notice or present any claim under any such insurance policy in due and timely fashion. 3.19 Except as disclosed herein the Company does not have any outstanding material agreements (including employment agreements) contracts or commitment, whether written or oral, of any nature or kind whatsoever, except: (a) agreements, contracts and commitments in the ordinary course of business; (b) service contracts on office equipment; (c) the employment, services and pension agreements described in the Schedules hereto; and (d) the lease described in the Schedules hereto. 3.20 Except as provided in the Schedules hereto, there are no actions, suits or proceedings (whether or not purportedly on behalf of the Company), pending or threatened against or affecting the Company or affecting the Business, at law or in equity, or before or by any federal, state, municipal or other governmental department, commission, board, bureau, agency or instrumentality, domestic or foreign and neither the Company nor the Vendors are aware of any existing ground on which any such action, suit or proceeding might be commenced with any reasonable likelihood of success. 6 3.21 The Company is not in material default or breach of any contracts, agreements, written or oral, indentures or other instruments to which it is a party and there exists no state of facts which after notice or lapse of time or both which would constitute such a default or breach, and all such contracts, agreements, indentures or other instruments are now in good standing and the Company is entitled to all benefits thereunder. 3.22 The Company has the right to use all of the registered trade marks and trade names, both domestic and foreign, in relation to the Business as set out in the Schedules hereto. 3.23 To the best of the knowledge of the Company and the Vendors, the conduct of the Business does not infringe upon the patents, trade marks, trade names or copyrights, domestic or foreign, of any other person, firm or corporation. 3.24 To the best of the knowledge of the Company and the Vendors, the Company is conducting and will conduct the Business in compliance with all applicable laws, rules and regulations of each jurisdiction in which the Business is or will be carried on, the Company is not in material breach of any such laws, rules or regulations and is or will be on the Closing Date fully licensed, registered or qualified in each jurisdiction in which the Company owns or leases property or carries on or proposes to carry on the Business to enable the Business to be carried on as now conducted and its property and assets to be owned, leased and operated, and all such licenses, registrations and qualifications are or will be on the Closing Date valid and subsisting and in good standing and that none of the same contains or will contain any provision, condition or limitation which has or may have a materially adverse effect on the operation of the Business. 3.25 All facilities and equipment owned or used by the Company in connection with the Business are in good operating condition and are in a state of good repair and maintenance. 3.26 Except as disclosed in the Company Financial Statements and salaries incurred in the ordinary course of business since the date thereof, the Company has no loans or indebtedness outstanding which have been made to or from directors, former directors, officers, shareholders and employees of the Company or to any person or corporation not dealing at arm's length with any of the foregoing, and will not, prior to closing, pay any such indebtedness unless in accordance with budgets agreed in writing by the Purchaser. 3.27 The Company has made full disclosure to the Purchaser of all aspects of the Business and has made all of its books and records available to the representatives of the Purchaser in order to assist the Purchaser in the performance of its due diligence searches and no material facts in relation to the Business have been concealed by the Company or the Vendors. 3.28 There are no material liabilities of the Company of any kind whatsoever, whether or not accrued and whether or not determined or determinable, in respect of which the Company or the Purchaser may become liable on or after the consummation of the transaction contemplated by this agreement, other than liabilities which may be reflected on the Company Financial Statements, liabilities disclosed or referred to in this agreement or in the Schedules attached hereto, or liabilities incurred in the ordinary course of business and attributable to the period since the date of the Company Financial Statements, none of which has been materially adverse to the nature of the Business, results of operations, assets, financial condition or manner of conducting the Business. 7 3.29 The Articles, bylaws and other constating documents of the Company in effect with the appropriate corporate authorities as at the date of this agreement will remain in full force and effect without any changes thereto as at the Closing Date. 3.30 The directors and officers of the Company are as follows: Name Position ---- -------- Charles Seven CEO, Chairman & Director Pirjo Jarvis President & Director Ron Robertson Vice President & Director Thomas Blake Operations Officer Keith Romine Secretary & Director 4. COVENANTS, REPRESENTATIONS AND WARRANTIES OF THE PURCHASER ---------------------------------------------------------------- The Purchaser covenants with and represents and warrants to the Vendors and the Company as follows and acknowledges that the Vendors are relying upon such covenants, representations and warranties in entering into this agreement: 4.1 The Purchaser has been duly incorporated and organized and is validly subsisting under the laws of the State of Nevada; it is a reporting issuer under the United States Securities Exchange Act of 1934 and is in good --------------------------------------------- standing with respect to all filings required to be made under such statutes with the United States Securities and Exchange Commission; it has the corporate power to own or lease its properties and to carry on its business as now being conducted by it; and it is duly qualified as a corporation to do business and is in good standing with respect thereto in each jurisdiction in which the nature of its business or the property owned or leased by it makes such qualification necessary. 4.2 The authorized capital of the Purchaser consists of 100,000,000 common shares, par value $0.001 per share, of which 14,534,600 shares are currently issued and outstanding as fully paid and non-assessable. 4.3 No person, firm or corporation has any agreement or option, including convertible securities, warrants or convertible obligations of any nature, or any right or privilege (whether by law, pre-emptive or contractual) capable of becoming an agreement or option for the purchase, subscription, allotment or issuance of any of the unissued shares in the capital of the Purchaser. 4.4 The Purchaser will not, without the prior written consent of the Vendors, issue any additional shares from and after the date hereof to the Closing Date or create any options, warrants or rights for any person to subscribe for any unissued shares in the capital of the Purchaser, except for any shares to be issued to complete the financing described in Article 5. 4.5 The directors and officers of the Purchaser are as follows: 8 Name Position ---- -------- Stacey Lauridia President & Director Louis Scarrone Chairman of the Board & Director Kathy Whyte Secretary, Treasurer & Director George Lois Director 4.6 The Purchaser Audited Financial Statements present fairly the assets, liabilities (whether accrued, absolute, contingent or otherwise) and the financial condition of the Purchaser as at the date thereof and there will not be, prior to the Closing Date, any material increase in such liabilities. 4.7 There have been no material adverse changes in the financial position or condition of the Purchaser or damage, loss or destruction materially affecting the business or property of the Purchaser since the date of the Purchaser Audited Financial Statements except as disclosed in the Company's Form 8K filed with the United States Securities and Exchange Commission on August 23, 2002. 4.8 The Purchaser has made full disclosure to the Company of all material aspects of the Purchaser's business and has made all of its books and records available to the representatives of the Company in order to assist the Company in the performance of its due diligence searches and no material facts in relation to the Purchaser's business have been concealed by the Purchaser. 4.9 The Purchaser is not a party to or bound by any agreement or guarantee, warranty, indemnification, assumption or endorsement or any other like commitment of the obligations, liabilities (contingent or otherwise) or indebtedness or any other person, firm or corporation. 4.10 Except as disclosed in the Schedules attached hereto, there are no actions, suits or proceedings (whether or not purportedly on behalf of the Purchaser), pending or threatened against or affecting the Purchaser or affecting the Purchaser's business, at law or in equity, or before or by any federal, state, municipal or other governmental department, commission, board, bureau, agency or instrumentality, domestic or foreign and the Purchaser is not aware of any existing ground on which any such action, suit or proceeding might be commenced with any reasonable likelihood of success. 4.11 The Purchaser's common shares are quoted on the NASD OTC Bulletin Board and the Purchaser is not in breach of any regulation, by-law or policy of, or any of the terms and conditions of its quotation on the NASD OTC Bulletin Board applicable to the Purchaser or its operations. 4.12 The Purchaser does not currently have any employees and is not party to any collective agreements with any labour unions or other association of employees. 4.13 The Purchaser does not have any subsidiaries or agreements of any nature to acquire any subsidiary or to acquire or lease any other business operations and will not prior to the Closing Date acquire, or agree to acquire, any subsidiary or business without the prior written consent of the Company. 9 4.14 The business of the Purchaser now and until the Closing Date will be carried on in the ordinary and normal course after the date hereof and upon to the Closing Date and no material transactions shall be entered into until the Closing Date without the prior written consent of the Vendors. 4.15 No liability, cost or expense will be incurred or payable by the Purchaser in connection with the disposition of any of its properties. 4.16 No capital expenditures in excess of $5,000 have been made or authorized by the Purchaser since the date of the Purchaser Audited Financial Statements and no capital expenditures in excess of $5,000 will be made or authorized by the Purchaser after the date hereof and up to the Closing Date without the prior written consent of the Vendors. 4.17 The Purchaser is not indebted to any of its directors or officers nor are any of the Purchaser's directors or officers indebted to the Purchaser. 4.18 The Purchaser has good and marketable title to its properties and assets as set out in the Purchaser Audited Financial Statements and such properties and assets are not subject to any mortgages, pledges, liens, charges, security interests, encumbrances, actions, claims or demands of any nature whatsoever or howsoever arising. 4.19 The Corporate Charter, Articles of Incorporation and Bylaws and any other constating documents of the Purchaser in effect with the appropriate corporate authorities as at the date of this agreement will not have been materially changed as at the Closing Date other than to effect any changes set out in Article 5. 4.20 There are no material liabilities of the Purchaser of any kind whatsoever, whether or not accrued and whether or not determined or determinable, in respect of which the Purchaser or the Company may become liable on or after the consummation of the transaction contemplated by this agreement, other than liabilities which may be reflected on the Purchaser Audited Financial Statements, liabilities disclosed or referred to in this agreement or in the Schedules attached hereto, or liabilities incurred in the ordinary course or business and attributable to the period since the date of the Purchaser Audited Financial Statements, none of which has been materially adverse to the nature of the Purchaser's business, results of operations, assets, financial condition or manner of conducting the Purchaser's business. 4.21 (a) The entering into of this agreement and the consummation of the transactions contemplated hereby will not result in the violation of any of the terms and provisions of the constating documents or bylaws of the Purchaser or of any indenture, instrument or agreement, written or oral, to which the Purchaser may be a party; (b) The entering into of this agreement and the consummation of the transactions contemplated hereby will not, to the best of the knowledge of the Purchaser, result in the violation of any law or regulation of the United States or of Nevada or of any local government bylaw or ordinance to which the Purchaser or the Purchaser's business may be subject; 10 (c) This agreement has been duly authorized, validly executed and delivered by the Purchaser. 4.22 The Purchaser has no contracts with any officers, directors, accountants, lawyers or others which cannot be terminated with not more than one month's notice. 4.23 No agreement has been made with Purchaser in respect of the purchase and sale contemplated by this Agreement that could give rise to any valid claim by any person against the Company or any Vendor for a finder's fee, brokerage commission or similar payment. 5. ACTS IN CONTEMPLATION OF CLOSING ------------------------------------ The Purchaser and the Company covenant and agree with each other and the Vendors to do or cause to be done the following prior to or on the Closing Date: 5.1 The Purchaser will: (a) call an extraordinary general meeting of its shareholders to seek approval to the change of the name of the Purchaser to "Transworld Benefits, Inc." or such other name as is approved by the directors and the Vendors; (b) complete a debt or equity financing to raise net proceeds of not less than $500,000 US. (c) cause the Purchaser Financial Statements to be audited. 5.2 The Company will cause the Company Financial Statements to be reviewed and commented upon or audited as may required by Item 310 of SEC Regulation SB in order to permit the Purchaser to make the SEC filings required in respect of the purchase and sale of the shares of the Company in accordance with this Agreement. 6. CONDITIONS OF CLOSING ----------------------- 6.1 All obligations of the Purchaser under this agreement are subject to the fulfilment, at or prior to the Closing Date, of the following conditions: (a) Except as affected by the completion of the acts set out in Article 5, the respective representations and warranties of the Vendors and the Company contained in this agreement or in any Schedule hereto or certificate or other document delivered to the Purchaser pursuant hereto shall be substantially true and correct as of the date hereof and as of the Closing Date with the same force and effect as though such representations and warranties had been made on and as of such date, regardless of the date as of which the information in this agreement or any such Schedule or certificate is given, and the Purchaser shall have received on the Closing Date certificates dated as of the Closing Date, in forms satisfactory to counsel for the Purchaser and signed under seal by the respective Vendors and by two senior officers 11 of the Company to the effect that their respective representations and warranties referred to above are true and correct on and as of the Closing Date with the same force and effect as though made on and as of such date, provided that the acceptance of such certificates and the closing of the transaction herein provided for shall not be a waiver of the respective representations and warranties contained in Articles 3 and 4 or in any Schedule hereto or in any certificate or document given pursuant to this agreement which covenants, representations and warranties shall continue in full force and effect for the benefit of the Purchaser; (b) the Company shall have caused to be delivered to the Purchaser either a certificate of an officer of the Company or, at the Purchaser's election, an opinion of legal counsel acceptable to the Purchaser's legal counsel, in either case, in form and substance satisfactory to the Purchaser, dated as of the Closing Date, to the effect that: (i) the Company owns, possesses and has good and marketable title to its undertaking, property and assets, and without restricting the generality of the foregoing, those assets described in the balance sheet included in the Company Financial Statements, free and clear of any and all mortgages, liens, pledges, charges, security interests, encumbrances, actions, claims or demands of any nature whatsoever and howsoever arising; (ii) the Company has been duly incorporated, organized and is validly existing under the laws of Nevada, it has the corporate power to own or lease its properties and to carry on its business that is now being conducted by it and is in good standing with respect to filings with the appropriate governmental authorities; (iii) the issued and authorized capital of the Company is as set out in this agreement and all of the issued and outstanding shares have been validly issued as fully paid and non-assessable; (iv) all necessary approvals and all necessary steps and corporate proceedings have been obtained or taken to permit the Company Shares to be duly and validly transferred to and registered in the name of the Purchaser; and (v) the consummation of the purchase and sale contemplated by this agreement, and specifically the transfer of the Company Shares to the Purchaser, will not be in breach of any laws of Nevada, and, in particular but without limiting the generality of the foregoing, the execution and delivery of this agreement by the Vendors and the Company has not breached and the consummation of the purchase and sale contemplated hereby will not be in breach of any laws of Nevada or of any state in which a Vendor is resident or the Company carries on business; and, without limiting the generality of the foregoing, that all corporate proceedings of the Company, its shareholders and directors and all other matters which, in the reasonable opinion of counsel for the Purchaser, are material in connection with the 12 transaction of purchase and sale contemplated by this agreement, have been taken or are otherwise favourable to the completion of such transaction. (c) At the Closing Date there shall have been no materially adverse change in the affairs, assets, liabilities, or financial condition of the Company or the Business (financial or otherwise) from that shown on or reflected in the Company Financial Statements. (d) No substantial damage by fire or other hazard to the Business shall have occurred prior to the Closing Date. (e) The Company shall have completed or be able to complete on the Closing Date those acts required to have been done in contemplation of closing as set out in Article 5. 6.3 In the event any of the foregoing conditions contained in paragraph 6.2 hereof are not fulfilled or performed at or before the Closing Date to the reasonable satisfaction of the Purchaser, the Purchaser may terminate this agreement by written notice to the Vendors and in such event the Purchaser shall be released from all further obligations hereunder but any of such conditions may be waived in writing in whole or in part by the Purchaser without prejudice to its rights of termination in the event of the non-fulfilment of any other conditions or conditions. 6.4 All obligations of the Vendors under this agreement are subject to the fulfilment, at or prior to the Closing Date, of the following conditions: (a) The representations and warranties of the Purchaser contained in this agreement or in any Schedule hereto or certificate or other document delivered to the Company and the Vendors pursuant hereto shall be substantially true and correct as of the date hereof and as of the Closing Date with the same force and effect as though such representations and warranties had been made on and as of such date, regardless of the date as of which the information in this agreement or any such Schedule or certificate is given, and the Vendors shall have received on the Closing Date a certificate dated as of the Closing Date, in form satisfactory to the Vendors and signed under seal by two senior officers of the Purchaser, to the effect that such representations and warranties referred to above are true and correct on and as of the Closing Date with the same force and effect as though made on and as of such date, provided that the acceptance of such certificate and the closing of the transaction herein provided for shall not be a waiver of the representations and warranties contained in Article 4 or in any Schedule hereto or in any certificate or document given pursuant to this agreement which covenants, representations and warranties shall continue in full force and effect for the benefit of the Vendors. (b) The Purchaser shall have caused to be delivered to the Vendors either a certificate of an officer of the Purchaser or, at the Vendor's election, an opinion of legal counsel acceptable to counsel to the Vendors, in either case, in form and substance satisfactory to the Vendors, dated as of the Closing Date, to the effect that: (i) the Purchaser has been duly incorporated and organized and is validly subsisting under the laws of Nevada, it has the corporate power to own or 13 lease its properties and to carry on its business that is now being conducted by it and is in good standing with respect to all filings with the appropriate corporate authorities in Nevada and with respect to all annual and quarterly filings with the United States Securities and Exchange Commission; (ii) the issued and authorized capital of the Purchaser is as set out in this agreement and all issued shares have been validly issued as fully paid and non-assessable; (iii) all necessary approvals and all necessary steps and corporate proceedings have been obtained or taken to permit the Purchaser Shares to be duly and validly allotted and issued to and registered in the name of the Vendors; (iv) the consummation of the purchase and sale contemplated by this agreement, and specifically the issuance and delivery of the Purchaser Shares to the Vendors in consideration of the purchase of the Company Shares, will not be in breach of any laws of Nevada and, in particular but without limiting the generality of the foregoing, the execution and delivery of this agreement by the Purchaser has not breached and the consummation of the purchase and sale contemplated hereby will not be in breach of any securities laws of the United States of America; and, without limiting the generality of the foregoing, that all corporate proceedings of the Purchaser, its shareholders and directors and all other matters which, in the reasonable opinion of counsel for the Company, are material in connection with the transaction of purchase and sale contemplated by this agreement, have been taken or are otherwise favourable to the completion of such transaction. (c) At the Closing Date there shall have been no materially adverse change in the affairs, assets, liabilities, financial condition or business (financial or otherwise) of the Purchaser from that shown on or reflected in the Purchaser Audited Financial Statements. (d) The Purchaser shall have completed or be able to complete on the Closing Date those acts required to have been done in contemplation of closing as set out in Article 5. 6.5 In the event that any of the conditions contained in paragraph 6.4 hereof shall not be fulfilled or performed by the Purchaser at or before the Closing Date to the reasonable satisfaction of the Vendors then the Vendors shall have all the rights and privileges granted to the Purchaser under paragraph 6.3, mutatis mutandis. 7. CLOSING ARRANGEMENTS --------------------- 7.1 The closing shall take place on the Closing Date at the offices of Cane O'Neill Taylor, LLC at Suite 500, 2300 West Sahara Avenue, Las Vegas, Nevada. 14 7.2 On the Closing Date, upon fulfilment of all the conditions set out in Article 6 which have not been waived in writing by the Purchaser or by the Vendors, as the case may be, then: (a) the Vendors shall deliver to the Purchaser: (i) certificates representing all the Company Shares duly endorsed in blank for transfer or with a stock power of attorney (in either case with the signature guaranteed by the appropriate official) with all eligible security transfer taxes paid; (ii) the certificates and officer's certificate or opinion referred to in paragraph 6.2; and (iii) evidence satisfactory to the Purchaser and its legal counsel of the completion by the Company and the Vendors of those acts referred to in paragraph 5.2. (b) the Vendors and the Company shall cause the transfers of the Company Shares into the name of the Purchaser, or its nominee, to be duly and regularly recorded in the books and records of the Company; (c) the Purchaser shall issue and deliver to the Vendors: (i) share certificates representing the Purchaser Shares duly endorsed with legends, acceptable to the Purchaser's counsel, respecting restrictions on transfer as required by or necessary under the applicable securities legislation of the United States or any state, including the non-transferability of such shares for a period of one year from the Closing Date; (ii) the certificates and officer's certificate or opinion referred to in paragraph 6.4; (iii) evidence satisfactory to the Vendors and their legal counsel of the completion by the Purchaser of those acts referred to in paragraph 5.1; and (iv) sequential resignations and directors resolutions such that all of the directors of the Purchaser and all of the Officers of the Purchaser other than Kathy Whyte will have resigned and the following will have been appointed directors of the Purchaser immediately following closing: Charles Seven Derek van Laare Keith Romine. 8. GENERAL PROVISIONS ------------------- 8.1 Time shall be of the essence of this agreement. 15 8.2 This agreement contains the whole agreement between the parties hereto in respect of the purchase and sale of the Company Shares and there are no warranties, representations, terms, conditions or collateral agreements expressed, implied or statutory, other than as expressly set forth in this agreement. 8.3 This agreement shall enure to the benefit of and be binding upon the parties hereto and their respective successors and permitted assigns. The Purchaser may not assign this agreement without the consent of the Company which consent may be unreasonably withheld. 8.4 Any notice to be given under this agreement shall be duly and properly given if made in writing and by delivering or telecopying the same to the addressee at the address as set out on page one of this agreement. Any notice given as aforesaid shall be deemed to have been given or made on, if delivered, the date on which it was delivered or, if telecopied, on the next business day after it was telecopied. Any party hereto may change its address for notice from time to time by notice given to the other parties hereto in accordance with the foregoing. 8.5 This agreement may be executed in one or more counter-parts, each of which so executed shall constitute an original and all of which together shall constitute one and the same agreement. 8.6 This agreement shall be construed and enforced in accordance with, and the rights of the parties shall be governed by, the laws of the State of Nevada, and each of the parties hereto irrevocably attorns to the jurisdiction of the Courts of the State of Nevada. 8.7 No claim shall be made by the Company or the Vendor against the Purchaser, or by the Purchaser against the Company or the Vendors, as a result of any misrepresentation or as a result of the breach of any covenant or warranty herein contained unless the aggregate loss or damage to such party exceeds $5,000. [signatures begin on the following page] 16 IN WITNESS WHEREOF the parties hereto have executed this agreement as of the day and year first above written. THE COMMON SEAL OF TRANSWORLD BENEFITS INC. was hereunto affixed in the presence of: c/s _/s/___________________________ Authorized Signatory THE COMMON SEAL OF THINKA WEIGHT LOSS CORPORATION c/s was hereunto affixed in the presence of: __/s/__________________________ Authorized Signatory SIGNED, SEALED AND DELIVERED BY CHARLES SEVEN in the presence of: __/s/__________________________ __/s/CHARLES SEVEN____________ Signature of Witness CHARLES SEVEN _______________________________ Name _______________________________ Address 17 SIGNED, SEALED AND DELIVERED BY RON ROBERTSON in the presence of: __/S/__________________________ __/S/RON ROBERTSON_____________ Signature of Witness RON ROBERTSON _______________________________ Name _______________________________ Address 18 SCHEDULE "A" ------------- to that Share Purchase Agreement dated as of October 4, 2002 PURCHASER FINANCIAL STATEMENTS June 2002 US FS (Revised).doc THINKA WEIGHT-LOSS CORPORATION (Formerly Encore Ventures, Inc.) (A Development Stage Company) FINANCIAL STATEMENTS JUNE 30, 2002 (Stated in U.S. Dollars) AUDITORS' REPORT To the Shareholders of Thinka Weight-Loss Corporation (Formerly Encore Ventures, Inc.) (A development stage company) We have audited the balance sheets of Thinka Weight-Loss Corporation (formerly Encore Ventures, Inc.) (a development stage company) as at June 30, 2002 and June 30, 2001, and the statements of loss and deficit accumulated during the development stage, cash flows and stockholders' equity for the year ended June 30, 2002, for the two month period ended June 30, 2001, for the year ended April 30, 2001, and for the period from September 14, 1999 (date of inception) to June 30, 2002. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with United States of America generally accepted auditing standards. Those standards require that we plan and perform an audit to obtain reasonable assurance whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, these financial statements present fairly, in all material respects, the financial position of the Company as at June 30, 2002 and June 30, 2001, and the results of its operations, cash flows, and changes in stockholders' equity for the year ended June 30, 2002, for the two month period ended June 30, 2001, for the year ended April 30, 2001, and for the period from September 14, 1999 (date of inception) to June 30, 2002, in accordance with United States of America generally accepted accounting principles. The accompanying financial statements have been prepared assuming the Company will continue as a going concern. As discussed in Note 1(c) to the financial statements, the Company incurred a net loss of $497,371 since inception, has not attained profitable operations and is dependent upon obtaining adequate financing to fulfil its development activities. These factors raise substantial doubt that the Company will be able to continue as a going concern. Management's plans in regard to these matters are also discussed in Note 1(c). The financial statements do not include any adjustments that might result from the outcome of this uncertainty. Vancouver, Canada September 30, 2002 Chartered Accountants THINKA WEIGHT-LOSS CORPORATION (Formerly Encore Ventures, Inc.) (A Development Stage Company) BALANCE SHEETS (Stated in U.S. Dollars) - -------------------------------------------------------- JUNE 30 2002 2001 - -------------------------------------------------------- ASSETS Current Cash $ 14,654 $ 15,198 Prepaid expenses 1,979 - --------------------- 16,633 15,198 --------------------- Equipment (Note 4) 2,470 - Intangible Asset (Note 5) 250,000 - --------------------- $ 269,103 $ 15,198 ===================================================== LIABILITIES Current Accounts payable and accrued liabilities $ 11,100 $ 9,516 Notes payable (Note 6) 89,500 - --------------------- 100,600 9,516 --------------------- STOCKHOLDERS' EQUITY Capital Stock Authorized: 100,000,000 Common shares, par value $0.001 per share Issued and outstanding: 14,534,600 Common shares at June 30, 2002 and 3,380,000 Common shares at June 30, 2001 14,534 3,380 Additional paid-in capital 651,340 91,120 Deficit Accumulated During The Development Stage (497,371) (88,818) --------------------- 168,503 5,682 --------------------- $ 269,103 $ 15,198 ===================================================== THINKA WEIGHT-LOSS CORPORATION (Formerly Encore Ventures, Inc.) (A Development Stage Company) STATEMENTS OF LOSS AND DEFICIT (Stated in U.S. Dollars) - -------------------------------------------------------------------------------- TWO INCEPTION YEAR MONTHS YEAR SEPTEMBER 14 ENDED ENDED ENDED 1999 TO JUNE 30 JUNE 30 APRIL 30 JUNE 30 2002 2001 2001 2002 - -------------------------------------------------------------------------------- Expenses Consulting fees $ 191,615 $ 5,000 $ 1,000 $197,615 Depreciation 692 - - 692 Grants 10,000 - - 10,000 Mineral property option payments - - 666 25,666 Office administration and sundry 79,058 2,016 10,049 95,189 Professional fees 116,834 736 35,424 158,528 Stock transfer services 12,770 - 1,390 14,160 410,969 7,752 48,529 501,850 ------------------------------------------------- Income Interest (2,416) (103) (1,960) (4,479) ------------------------------------------------- Net Loss For The Period 408,553 7,649 46,569 $497,371 ========= Deficit Accumulated During The Development Stage, Beginning Of Period 88,818 81,169 34,600 -------------------------------------- Deficit Accumulated During The Development Stage, End Of Period $ 497,371 $ 88,818 $ 81,169 ==================================================================== Basic And Diluted Loss Per Share $ (0.02) $ (0.01) $ (0.01) ==================================================================== Weighted Average Number Of Shares Outstanding 22,980,050 3,380,000 3,380,000 ==================================================================== THINKA WEIGHT-LOSS CORPORATION (Formerly Encore Ventures, Inc.) (A Development Stage Company) STATEMENTS OF CASH FLOWS (Stated in U.S. Dollars) - ----------------------------------------------------------------------- TWO INCEPTION YEAR MONTHS YEAR SEPTEMBER 14 ENDED ENDED ENDED 1999 TO JUNE 30 JUNE 30 APRIL 30 JUNE 30 2002 2001 2001 2002 - ----------------------------------------------------------------------- Cash Flows From Operating Activity Net loss for the period $(408,553) $(7,649) $(46,569) $(497,371) Adjustments To Reconcile Net Loss To Net Cash Used By Operating Activity Depreciation 692 - - 692 (Increase) Decrease in prepaid expenses 49,262 - - 49,262 Increase (Decrease) in accounts payable and accrued liabilities 1,584 (453) 7,952 11,100 ------------------------------------------- (357,015) (8,102) (38,617) (436,317) ------------------------------------------- Cash Flows From Investing Activity Purchase of intangible asset (250,000) - - (250,000) ------------------------------------------- Cash Flows From Financing Activities Proceeds from issuance of notes payable 89,500 - - 89,500 Proceeds from issuance of common stock - - - 94,500 ------------------------------------------- 89,500 - - 184,000 ------------------------------------------- (Decrease) In Cash (517,515) (8,102) (38,617) (531,625) Cash, Beginning Of Period 15,198 23,300 61,917 - Cash Acquired On Asset Acquisition 516,971 - - 516,971 ------------------------------------------- Cash, End Of Period $ 14,654 $15,198 $ 23,300 $ 14,654 ====================================================================== Supplemental Disclosure Of Non-Cash Financing And Investing Activities Stock issued for asset acquisition $ 577,874 $ - $ - $ 577,874 ====================================================================== Stock cancelled related to asset acquisition $ (6,500) $ - $ - $ (6,500) ======================================================================
THINKA WEIGHT-LOSS CORPORATION (Formerly Encore Ventures, Inc.) (A Development Stage Company) STATEMENT OF STOCKHOLDERS' EQUITY JUNE 30, 2002 (Stated in U.S. Dollars) COMMON STOCK DEFICIT ---------------------------------- ACCUMULATED ADDITIONAL DURING THE PAID-IN DEVELOPMENT SHARES AMOUNT CAPITAL STAGE TOTAL ---------------------------------------------------------- Shares issued for cash at $0.001 (December 1999) 1,500,000 $ 1,500 $ - $ - $ 1,500 Shares issued for cash at $0.01 (January 2000) 1,500,000 1,500 13,500 - 15,000 Shares issued for cash at $0.10 (February 2000) 280,000 280 27,720 - 28,000 Shares issued for cash at $0.50 (April 2000) 100,000 100 49,900 - 50,000 Net loss for the period - - - (34,600) (34,600) ---------------------------------------------------------- Balance, April 30, 2000 3,380,000 3,380 91,120 (34,600) 59,900 Net loss for the year - - - (46,569) (46,569) ---------------------------------------------------------- Balance, April 30, 2001 3,380,000 3,380 91,120 (81,169) 13,331 Net loss for the period - - - (7,649) (7,649) ---------------------------------------------------------- Balance, June 30, 2001 3,380,000 3,380 91,120 (88,818) 5,682 Forward stock split 3.8:1 (July 2001) 9,512,300 9,512 (9,512) - - Shares issued for acquisition of assets (July 2001) 12,892,300 12,892 564,982 - 577,874 Shares cancelled (June 2002) (11,250,000) (11,250) 4,750 - (6,500) Net loss for the year - - - (408,553) (408,553) ---------------------------------------------------------- Balance, June 30, 2002 14,534,600 $ 14,534 $651,340 $(497,371) $ 168,503 ==========================================================
THINKA WEIGHT-LOSS CORPORATION (Formerly Encore Ventures, Inc.) (A Development Stage Company) NOTES TO FINANCIAL STATEMENTS JUNE 30, 2002 (Stated in U.S. Dollars) 1. NATURE OF OPERATIONS a) Organization The Company was incorporated in the State of Nevada, U.S.A. on September 14, 1999. During the period ended June 30, 2001, the Company's year end was changed from April 30, 2001 to June 30, 2001. On July 19, 2001, the Company completed a forward stock split at a ratio of 3.8:1 which increased the issued and outstanding common shares from 3,380,000 shares to 12,892,300 shares. On August 8, 2001, the Company changed its name to Thinka Weight-Loss Corporation. b) Development Stage Activities Thinka Weight-Loss Corporation (the "Company") is currently a development stage company under the provisions of Statement of Financial Accounting Standards ("SFAS") No. 7. The Company holds the proprietary rights to a weight loss product that acts as an appetite reducing agent while providing proper nutritional requirements. Management's intention is to market the product to the mild to moderately overweight individual. In prior years, the Company had been primarily engaged in the acquisition and exploration of mining properties, and was classified as an exploration stage company. c) Going Concern The accompanying financial statements have been prepared assuming the Company will continue as a going concern. As shown in the accompanying financial statements, the Company has incurred a net loss of $497,371 for the period from September 14, 1999 (inception) to June 30, 2002, and has no sales. The future of the Company is dependent upon its ability to obtain financing and upon future profitable operations from the development of its new business opportunities. Management has plans to seek additional capital through a private placement and public offering of its common stock. The financial statements do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts of and classification of liabilities that might be necessary in the event the Company cannot continue in existence. THINKA WEIGHT-LOSS CORPORATION (Formerly Encore Ventures, Inc.) (A Development Stage Company) NOTES TO FINANCIAL STATEMENTS JUNE 30, 2002 (Stated in U.S. Dollars) 2. SIGNIFICANT ACCOUNTING POLICIES The financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States of America. Because a precise determination of many assets and liabilities is dependent upon future events, the preparation of financial statements for a period necessarily involves the use of estimates which have been made using careful judgement. The financial statements have, in management's opinion, been properly prepared within reasonable limits of materiality and within the framework of the significant accounting policies summarized below: a) Cash and Cash Equivalents For purposes of the statement of cash flows, the Company considers all highly liquid investments purchased with original maturities of three months or less to be cash equivalents. b) Office Equipment Office equipment is recorded at cost and amortized on a straight line basis over its estimated economic life of five years. c) Intangible Asset The Company continually monitors its intangible assets to determine whether any impairment has occurred. In making such determination with respect to these assets, the Company evaluates the performance on an undiscounted cash flow basis, of the intangible assets or group of assets, which gave rise to an asset's carrying amount. Should impairment be identified, a loss would be reported to the extent that the carrying value of the related intangible asset exceeds the fair value of that intangible asset using the discounted cash flow method. The Company has not amortized intangible assets as operations have not commenced. THINKA WEIGHT-LOSS CORPORATION (Formerly Encore Ventures, Inc.) (A Development Stage Company) NOTES TO FINANCIAL STATEMENTS JUNE 30, 2002 (Stated in U.S. Dollars) 2. SIGNIFICANT ACCOUNTING POLICIES (Continued) d) Basic and Diluted Loss Per Share In accordance with SFAS No. 128 - "Earnings Per Share", the basic loss per common share is computed by dividing net loss available to common stockholders by the weighted average number of common shares outstanding. Diluted loss per common share is computed similar to basic loss per common share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. At June 30, 2002, the Company has 1,642,300 of common stock equivalents that were anti-dilutive and excluded in the earnings per share computation. e) Income Taxes The Company accounts for income taxes under SFAS No. 109 - "Accounting for Income Taxes". Under the asset and liability method of SFAS No. 109, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Under SFAS No. 109, the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period the enactment occurs. A valuation allowance is provided for certain deferred tax assets if it is more likely than not that the Company will not realize tax assets through future operations. f) Financial Instruments and Concentration of Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of cash, accounts payable and accrued liabilities, and notes payable. At June 30, 2002, the fair market value of these instruments approximated their financial statement carrying amount due to the short-term maturity of these instruments. g) Mineral Property Option Payments and Exploration Costs The Company expenses all costs related to the maintenance and exploration of mineral claims in which it has secured exploration rights prior to establishment of proven and probable reserves. To date, the Company has not established the commercial feasibility of its exploration prospects, therefore, all costs are being expensed. THINKA WEIGHT-LOSS CORPORATION (Formerly Encore Ventures, Inc.) (A Development Stage Company) NOTES TO FINANCIAL STATEMENTS JUNE 30, 2002 (Stated in U.S. Dollars) 2. SIGNIFICANT ACCOUNTING POLICIES (Continued) h) Impairment of Long-Lived Assets and Long-Lived Assets to be Disposed of The Company reviews long-lived assets and including identifiable intangibles for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to future net cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceed the fair value of the assets. Assets to be disposed of are reported at the lower of the carrying amount or fair value less costs to sell. i) Recent Accounting Pronouncements In July 2001, the Financial Accounting Standards Board ("FASB") issued SFAS No. 141 - "Business Combinations", and SFAS No. 142 - "Goodwill and Other Intangible Assets". SFAS No. 141 eliminates the pooling-of-interests method of accounting for business combinations, except for qualifying business combinations that were initiated prior to July 1, 2001. Under SFAS No. 142, goodwill and indefinite-lived intangible assets are no longer amortized, but are reviewed annually, or more frequently if impairment indicators arise, for impairment. The Company is required to adopt SFAS No. 142 on July 1, 2002. The Company does not believe the adoption of SFAS Nos. 141 and 142 will have a material effect on its financial statements. In August 2001, the FASB issued SFAS No. 143 - "Accounting for Asset Retirement Obligations". SFAS No. 143 requires that the fair value of a liability for an asset retirement obligation be recognized in the period in which it is incurred if a reasonable estimate of fair value can be made. The associated asset retirement costs are capitalized as part of the carrying amount of the long-lived assets. The Company is required to adopt SFAS No. 143 on July 1, 2002, and it does not believe the adoption of SFAS No. 143 will have a material effect on its financial statements. In October 2001, the FASB issued SFAS No. 144 - "Accounting for the Impairment or Disposal of Long-Lived Assets", which supersedes SFAS No. 121 - "Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed of", and provides a single accounting model for long-lived assets to be disposed of. The Company is required to adopt SFAS No. 144 on July 1, 2002, and it does not believe the adoption of SFAS No. 144 will have a material effect on its financial statements. THINKA WEIGHT-LOSS CORPORATION (Formerly Encore Ventures, Inc.) (A Development Stage Company) NOTES TO FINANCIAL STATEMENTS JUNE 30, 2002 (Stated in U.S. Dollars) 3. ACQUISITION OF ASSETS On July 30, 2001, the Company entered into an Asset Purchase and Sale Agreement to acquire all the assets of Six Forty-Nine Incorporated ("649"), a Nevada corporation, by issuing 12,892,300 common shares of the Company. The asset acquisition is summarized as follows: Current assets (including cash of $516,971) $ 568,212 Equipment, net 3,162 Intangible asset - Medslim Program 6,500 --------- Total consideration $ 577,874 Since the July 30, 2001 transaction resulted in the former shareholders of 649 acquiring control of Thinka Weight-Loss Corporation ("Thinka"), the transaction, which is referred to as a "reverse take-over", was treated for financial reporting purposes as an acquisition by 649 of the net assets and liabilities of Thinka. 649 was deemed to be the purchaser for accounting purposes. Consequently, the quarterly unaudited interim financial statements were presented on a consolidated basis for the periods ended September 30, 2001, December 31, 2001 and March 31, 2002. On June 28, 2002, the Company entered into a stock redemption agreement with 649 to have 11,250,000 common shares returned and cancelled. As consideration for the redemption and cancellation of the 11,250,000 common shares, the intangible asset comprising the "Medslim Program" was returned to 649. As a result of the June 28, 2002 transaction, the former shareholders of 649 are no longer deemed to have acquired control of Thinka and the financial statements are now presented on a non-consolidated basis. 4. EQUIPMENT A summary of equipment is as follows: 2002 2001 --------------------- Office equipment $ 3,162 $ - Less: Accumulated depreciation (692) - --------------------- $ 2,470 $ - ===================== THINKA WEIGHT-LOSS CORPORATION (Formerly Encore Ventures, Inc.) (A Development Stage Company) NOTES TO FINANCIAL STATEMENTS JUNE 30, 2002 (Stated in U.S. Dollars) 5. INTANGIBLE ASSET On January 31, 2002, the Company entered into an Asset Purchase Agreement to acquire all the rights to the intellectual property known as "Carb Fighter". The total cash consideration paid was $250,000. The intangible asset represents the purchase of all the license rights, title, patents, and interest to certain proprietary formulas. 6. NOTES PAYABLE Notes payable are unsecured, due on demand and bear interest at Bank of America prime rate less 2%. 7. COMMITMENTS On July 31, 2001, the Company assumed the obligation from Six Forty-Nine Incorporated ("649") to issue up to 1,642,300 common shares of the Company on the exercise of 1,642,300 warrants issued by 649 with an exercise price of $1.00 per share, expiring December 2, 2002. The Company had entered into an agreement with its former president to provide management services for a one year term at $750 per month, expiring December 31, 2001. During the year ended June 30, 2002, this agreement was terminated. 8. INCOME TAXES At June 30, 2002, the Company has accumulated net operating losses totalling $497,000 which are available to reduce taxable income in future taxation years. These losses expire as follows: 2022 $ 408,000 2021 56,000 2020 33,000 ------------ $ 497,000 The future income tax asset related to these losses have not been recorded in the financial statements as it is more likely than not that the assets will not be realized and a full valuation allowance has been made. THINKA WEIGHT-LOSS CORPORATION (Formerly Encore Ventures, Inc.) (A Development Stage Company) NOTES TO FINANCIAL STATEMENTS JUNE 30, 2002 (Stated in U.S. Dollars) 9. RELATED PARTY TRANSACTIONS During the year ended June 30, 2002, the Company incurred the following expenses charged by entities controlled by either shareholders, directors and officers, or by individuals in their capacity as directors or officers: 2002 2001 ----------------------- Consulting $ 118,490 $ - Management fees - 1,500 ----------------------- $ 118,490 $ 1,500 ======================= These charges were measured by the exchange amount, which is the amount agreed upon by the transacting parties, and are on term and conditions similar to non-related entities. 10. MINERAL PROPERTY INTEREST The Company held an option agreement to acquire a 90% interest in a mineral claim block located in the Watson Lake Mining District, Yukon Territories, Canada, for consideration consisting of staged cash payments ($25,000 paid) and exploration expenditures totalling $200,000 by December 31, 2002. The option agreement was terminated on July 16, 2001 with the agreement of both parties. The Company is no longer pursuing mineral exploration activities and has focused on developing new business opportunities. SCHEDULE "B" ------------- to that Share Purchase Agreement dated as of October 4, 2002 COMPANY FINANCIAL STATEMENTS SCHEDULE "C" ------------- to that Share Purchase Agreement dated as of October 4, 2002 EMPLOYMENT, SERVICE & PENSION AGREEMENTS OF THE COMPANY EMPLOYMENT AGREEMENT (Thomas Blake) This EMPLOYMENT AGREEMENT (this "Agreement") is dated and entered into effective as of ______, 2002 (the "Effective Date"), by and between TRANSWORLD BENEFITS, INC. (fka Skyway Home, Inc.), a Nevada corporation (the "Company"), and THOMAS BLAKE, an individual ("Employee"). R E C I T A L S - - - - - - - - WHEREAS, the Company is a corporation formed and duly qualified in the State of Nevada. WHEREAS, the Company desires to engage Employee to perform certain services, and Employee desires to provide such services to the Company, upon the terms and conditions of this Agreement. A G R E E M E N T - - - - - - - - - NOW, THEREFORE, for and in consideration of the foregoing recitals, the mutual covenants, provisions and terms set forth in this Agreement and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Company and Employee agree as follows: 1. Engagement. The Company hereby employs Employee, and Employee hereby accepts such employment, to provide the "Services" (as defined below) upon the terms and conditions set forth in this Agreement. 2. Services. During the "Term" (as defined below) of this Agreement, Employee shall perform those services and duties as more described in Schedule 1 ---------- attached hereto (collectively, the "Services"). Employee shall have, subject to the direction, supervision and control of the Board of Directors of the Company (the "Board"), the Chief Executive Officer of the Company ("CEO") and the President of the Company (the "President"), and Employee agrees to faithfully perform, such additional duties consistent with such office as may be assigned from time to time by the Board or the CEO. During the Term, Employee shall report to the Board, the CEO and the President. 3. Term. Unless terminated earlier as provided in this Agreement, the Company retains Employee to provide the Services for a term beginning on October 1, 2002 (the "Start Date") and ending on September 30, 2005 (the "Term"). Thereafter, the Term shall be automatically extended for successive periods of one (1) year unless either the Company or Employee gives the other a written notice electing not to extend the Term, given not less than three (3) months prior to the date upon which any such extension would otherwise begin. As used herein, the term "Term" means the original term and any extension thereof. 4. Time and Effort. Employee shall perform the Services under this Agreement in a diligent and competent manner. During the Term, Employee shall perform the Services for the Company on a full-time basis. 5. Compensation. In consideration of Employee's performance of the Services hereunder and other covenants and agreements of Employee hereunder, the Company shall provide to Employee the compensation set forth in this Section 5. 5.1 Advancements. During the Term and subject to the terms and conditions set forth in Section 5.2 hereof, Employee shall receive advancements against future "Commissions" (as defined in Section 5.2 hereof) (each, an "Advancement") as follows, payable in accordance with the Company's payroll procedures: (i) During the first year of the Term, Employee shall receive total Advancements equal to One Hundred Twenty Thousand Dollars ($120,000); and (ii) During the second year of the Term and during each subsequent year thereafter, Employee shall receive Advancements in a total amount equal to One Hundred Twenty Thousand Dollars ($120,000) per year. 5.2 Commissions. During the Term, the Company shall pay to Employee the ----------- "Commissions" in the amounts set forth and as calculated pursuant to the terms of Schedule 2, attached hereto and incorporated herein by this reference (the ----------- "Sales Territory Business Plan"), subject to the following terms and conditions: (i) During the first year of the Term, fifty (50%) of any and all Commissions earned and payable to Employee during any such payment period shall be used to reduce the Advancements made to Employee pursuant to Section 5.1(i) above. Notwithstanding the foregoing to the contrary, during the first year, Employee's total compensation shall not be reduced to less than One Hundred Twenty Thousand Dollars ($120,000). For example, if no Commissions were earned and payable to Employee during the first year of the Term, Employee shall be entitled to retain the entire $120,000 of Advancements received by Employee pursuant to Section 5.1(i) hereof. (ii) After the first year of the Term, one hundred percent (100%) of any and all Commissions earned and payable to Employee during any such payment period shall be used to reduce any outstanding balance of the Advancements made by the Company to Employee during the term of this Agreement (excluding the Advancements made by the Company to Employee during the first year of the Term as set forth in Section 5.1(i) hereof), until such time as such outstanding balance is reduced to zero. (iii) In the event that Employee's employment is terminated by the Company with "cause" (as defined in Section 8.4.2 hereof) or terminated by Employee with or without cause, Employee shall repay to the Company the outstanding balance of the Advancements made by the Company to Employee during the term of this Agreement (excluding the Advancements made by the Company to Employee during the first year of the Term as set forth in Section 5.1(i) hereof), by no later than seven (7) days following such termination. (iv) Employee hereby acknowledges, understands and agrees that (A) any and all Commissions shall be calculated pursuant to the terms of the Sales Territory Business Plan as set forth in the attached Schedule 2, subject ---------- to the terms and conditions set forth in this Agreement; and (B) Employee shall perform such duties and obligations set forth in the Sales Territory Business Plan, including, without limitation, hiring and paying the salaries and expenses of employees. 5.3 Right of First Refusal. In the event that the Company is involved in ------------------------ any future offering of shares in the Company, Employee shall have the right of first refusal to purchase, at the purchase price offered to other investors, such number of shares of the Company under such offering so that Employee's total interest in the Company will not be less than two percent (2%) of the total issued and outstanding shares of capital stock in the Company (as determined on a fully diluted, as converted basis). 5.4 Stock Option Plan. A stock option plan (the "Plan") is being ------------------- established by the Company. Employee shall be entitled to receive options to purchase shares under the Plan equal to two percent (2%) of the total issued and outstanding shares of capital stock in the Company as of the Start Date (as determined on a fully diluted, as converted basis) (the "Optioned Shares"). Subject to the terms set forth herein and in the Plan, Employee shall have the right to purchase 1/3 of the Optioned Shares at each anniversary of the Start Date. Employee shall be entitled to receive such other shares under the Plan as determined by the Company's board of directors in its discretion. Employee hereby acknowledges that Employee's right, title and interest in and to any option granted under this Section 5.4 shall be subject to the terms and conditions set forth in the Plan. 6. Other Benefits. Employee shall be entitled to the following: 6.1 Reimbursement of Expenses. The Company shall reimburse Employee ------------------------- for all business-related expenses and costs actually incurred by Employee in the performance of the Services under this Agreement pursuant to the terms set forth in the Sales Territory Business Plan. In addition, the reimbursement of all such costs and expenses shall be subject to reasonable policies and procedures established from time to time by the Company, including, without limitation, as those set forth in the Company's Employee Handbook, as amended. 6.2 Paid Vacation. During the Term, Employee shall be entitled to such ------------- period of paid vacation as available to other employees of the Company as set forth in the Company's Employee Handbook, as amended. Notwithstanding the foregoing, during the first three (3) years of the Term, vacation shall not be taken more than two (2) weeks consecutively. 6.3 Car Allowance. During the Term, the Company will provide -------------- Employee with a car allowance of Seven Hundred Dollars ($700) per month pursuant to the terms set forth in the Sales Territory Business Plan. 6.4 Insurance. During the Term, Employee shall receive full medical --------- coverage generally available to the Company's other executive and managerial employees. In addition, Employee shall be entitled to receive all other benefits of employment generally available to Company's other executive and managerial employees when and as Employee becomes eligible for them, including dental, life insurance and disability plans. 7. Work Products/Confidentiality/Non-Competition. 7.1 Work Products. Employee hereby acknowledges and agrees that any -------------- and all "Work Products" (as defined below) which may have been or are made, developed or conceived of in whole or in part by Employee, or any of Employee's Representatives, in connection with services provided on behalf of the Company or relating to the business of the Company, shall belong solely and exclusively to the Company. Employee shall assign or cause its Representatives to assign to the Company such Employee's or Representative's entire right, title and interest, including all patent, copyright, trade secret, trademark and other proprietary rights, in any and all Work Products. The term "Work Products" means and includes, without limitation, a discovery, a development, a design, an improvement, an invention, a know-how, technical or non-technical data, a formula, a pattern, a compilation, a program, a device, a method, a technique, a drawing, a process, financial data, financial plans, product plans, business plans, software programs (including the object and source code thereto) or a list (whether in written form or otherwise) of actual or potential customers or suppliers, which is not commonly known by or available to the public and which information (i) derives economic value, actual or potential, from not being generally known to and not being readily ascertainable by proper means by other persons who can obtain economic value from its disclosure or use and (ii) is the subject of efforts that are reasonable under the circumstances to maintain its secrecy. 7.2 Business Opportunities. Employee covenants and agrees that any ----------------------- business opportunity which Employee or Employee's "Representatives" (as defined herein) might have during the term of this Agreement which relates to the business of the Company shall first be offered to the Company. If the Company rejects such offer, Employee shall be free to pursue such opportunity. The term "Representative" means and includes, with respect to any person or entity, each shareholder, director, officer, manager, constituent member, constituent partner, trustor, beneficiary, trustee, successor-in-interest, predecessor-in-interest, "Affiliate" (as defined in Section 7.4 hereof), employee, agent, attorney or other representative of such party, expressly excluding however, with respect to each party to this Agreement, the other party to this Agreement. 7.3 Proprietary Information. In the course of Employee's employment by ----------------------- the Company, each of Employee and Employee's Representatives, has had, and will continue to have, access to confidential and proprietary information regarding the Company and its business, including, but not limited to, information regarding the Company's technologies, methods and techniques, product information, specifications, technical drawings and designs, trade secrets, know-how, sources of supply, product and market research data, customer lists, marketing plans, and financial information regarding the Company and its operations. Such information shall be referred to hereinafter as "Proprietary Information" and shall include any and all of the information of the type described and shall also include any and all other confidential and proprietary information relating to the business to be conducted by the Company, whether previously existing, now existing or arising hereafter, whether conceived or developed by others or by Employee alone or with others, and whether or not conceived or developed during regular working hours. Proprietary Information which is released into the public domain during the period of Employee's employment under this Agreement, provided the same is not in the public domain as a consequence of disclosure directly or indirectly by Employee in violation of this Agreement, shall not be subject to the restrictions of this Section. 7.3.1 Fiduciary Obligations. Employee acknowledges that the Company ---------------------- has taken all reasonable steps in protecting the secrecy of the Proprietary Information, that said Proprietary Information is of critical importance to the Company and that a violation of this Section of this Agreement would seriously and irreparably impair and damage the Company's business. Accordingly, Employee agrees that it shall keep (and shall use its commercially reasonable best efforts to cause its Representatives to keep) all Proprietary Information in a fiduciary capacity for the sole benefit of the Company. 7.3.2 Non-Disclosure. Employee shall not, directly or indirectly, use -------------- or disclose (except as Employee's duties may require and except as required by law) any Proprietary Information to any person other than the Company, any employees of the Company who are authorized, at the time of such disclosure, to receive such information, or such other persons to whom Employee has been specifically instructed to make disclosure by the Board of Directors of the Company and in all such cases only to the extent required in the course of Employee's employment by the Company. At the termination of this Agreement, Employee shall deliver to the Company all notes, letters, documents, records, computer files, programs and other media which may contain Proprietary Information which are then in its possession or control and shall not retain or use any copies or summaries thereof. 7.4 Non-Competition. During the Term and for the two year period --------------- following the termination or expiration of the Term (such periods referred to collectively as the "Restriction Period"), neither Employee nor any of Employee's "Affiliates" (as defined below) shall, directly or indirectly, engage in, become employed by, serve as an agent or consultant to, or become a constituent member, partner, principal or stockholder (other than a holder of less than 5% of the outstanding voting shares of any publicly-held company) of, or receive any interest in or from any person or entity which engages directly or indirectly in any business or activity competitive with any business or activity engaged in by the Company or any of its subsidiaries. "Affiliates" shall mean and include, with respect to any other person or entity, any person or entity that directly or indirectly through one or more intermediaries controls or is controlled by, or is under common control with such person or entity. 7.5 Non-Solicitation of Employees. During the Restriction Period, ------------------------------- neither Employee nor any of Employee's Affiliates shall, directly or indirectly, for Employee's own account or for the account of any other person or entity with which Employee is or shall become associated in any capacity, (a) solicit for employment, employ or otherwise interfere with the relationship of the Company or any of its Affiliates, any person who at any time during the six months preceding such solicitation, employment or interference is or was employed by or otherwise engaged to perform services for the Company or any of its Affiliates, other than any such solicitation or employment during Employee's employment with the Company on behalf of the Company, or (b) induce any employee of the Company or any of its Affiliates who is a member of management to engage in any activity which Employee is prohibited from engaging in under any of this Section hereof or to terminate Employee's employment with the Company. 7.6 Non-Solicitation of Customers. During the Restriction Period, ------------------------------- neither Employee nor any of Employee's Affiliates shall, directly or indirectly, solicit or otherwise attempt to establish for Employee or any other person, firm or entity any business relationship of a nature that is competitive with the business or relationship of the Company or any of its Affiliates, with any person, firm or corporation which, during the twelve-month period preceding the date Employee's employment with the Company and its Affiliates terminates, was a customer, client or distributor of the Company or any of its Affiliates, other than any such solicitation during Employee's employment with the Company or on behalf of the Company. 8. Termination. 8.1 Termination Upon Death. If Employee dies during the Term, this ------------------------ Agreement shall terminate. Upon such termination, Employee shall be entitled to all accrued and unpaid compensation due under Section 5 above and the other obligations of the Company under this Agreement shall cease as of the date of the termination. 8.2 Termination Upon Permanent Disability. In the event of the ---------------------------------------- "Permanent Disability" (as hereinafter defined) of Employee, the Company may terminate this Agreement pursuant to the terms and conditions set forth in the Company's Employee Handbook, as amended. For the purposes of this Agreement, Employee shall be deemed to have suffered "Permanent Disability" in the event that Employee has become disabled by physical or mental illness or injury to the extent that the Board of Directors of the Company reasonably believes, notwithstanding such reasonable accommodations as the Company may make in response to such disability, that Employee cannot carry out or perform Employee's duties hereunder. In the event that the Company terminates this Agreement following Employee's Permanent Disability, other than accrued and unpaid compensation due to Employee, the compensation obligations of the Company under Section 5 hereof and any other obligations of the Company under this Agreement shall cease as of the date of the termination. 8.3 Termination by Employee. ------------------------- 8.3.1 Employee may terminate this Agreement without cause at any time and for any reason upon sixty (60) days' notice to the Company. 8.3.2 Employee may immediately terminate this Agreement for cause at any time by written notice to the Company. For purposes of this Agreement, the term "cause" for termination by Employee shall be (a) a breach by the Company of any material covenant or obligation hereunder; or (b) the voluntary or involuntary dissolution of the Company. The written notice given hereunder by Employee to the Company shall specify in reasonable detail the cause for termination, and, in the case of the cause described in (a) above, such termination notice shall not be effective until thirty (30) days after the Company's receipt of such notice, during which time the Company shall have the right to respond to Employee's notice and cure the breach or other event giving rise to the termination. In the event that the Company is able to cure, this Agreement shall continue in full force and effect. 8.4 Termination by the Company. ----------------------------- 8.4.1 The Company may terminate this Agreement without cause at any time and for any reason upon sixty (60) days' notice to Employee. 8.4.2 The Company may terminate this Agreement for cause at any time by written notice to Employee. For purposes of this Agreement, the term "cause" for termination by the Company shall be (a) a conviction of or plea of guilty or nolo contendre by Employee to a felony; (b) any action or activity of Employee which could reasonably be expected to have a material adverse effect on the Company, its business, its goodwill or its prospects; (c) the refusal by Employee to perform its material duties and obligations hereunder; or (d) Employee's gross negligence or willful and intentional misconduct in the performance of its duties and obligations. The written notice given hereunder by the Company to Employee shall specify in reasonable detail the cause for termination. In the case of a termination for the cause described in (a) above, such termination shall be effective upon receipt of the written notice. In the case of the causes described in (b) through (d) above, such termination notice shall not be effective until thirty (30) days after Employee's receipt of such notice, during which time Employee shall have the right to respond to the Company's notice and cure the breach or other event giving rise to the termination. In the event that Employee is able to cure, this Agreement shall continue in full force and effect. 8.5 Effect of Termination. Upon any termination of this ----------------------- Agreement, the obligations and covenants of the parties hereunder shall be of no further force and effect, except as provided in Section 11.7 below and as set forth in this Section 8.5. Upon any termination of this Agreement by Employee or the Company pursuant to Section 8 hereof, (a) the Company shall pay to Employee all accrued and unpaid compensation as of the date of such termination subject to the terms and conditions set forth in this Agreement; (b) if termination by the Company based on "cause" or by the Employee, Employee shall repay to the Company any outstanding balance of the Advancements made to Employee pursuant to Section 5.1(ii) hereof; and (c) all other obligations of the Company under this Agreement shall cease as of the date of such termination, including, without limitation, the right of Employee with respect to any unvested rights or shares granted or any future offering by the Company. 8.6 Effect of Combination or Dissolution. This Agreement shall --------------------------------------- not be terminated by the voluntary or involuntary dissolution of the Company, or by any merger or consolidation in which the Company is not the surviving or resulting entity, or any transfer of all or substantially all of the assets of the Company, or upon any transfer of a majority of the ownership interests of the Company by one or more members in one or more transactions, or upon the issuance of units of membership interests of the Company constituting a majority of the outstanding units immediately following such issuance. Instead, subject to Employee's right to terminate this Agreement pursuant to Section 8.3 above, the provisions of this Agreement shall be binding on and inure to the benefit of the Company's creditors, the surviving business entity or the business entity to which such units or assets shall be transferred. 9. Remedies. 9.1 Injunctive Relief. Employee acknowledges and agrees that (i) the ------------------ covenants and the restrictions contained in Section 7 above are necessary, fundamental, and required for the protection of the Company's business; (ii) such covenants relate to matters which are of a special, unique, and extraordinary character that gives each of such covenants a unique and extraordinary value; and (iii) a breach of any of such covenants will result in irreparable harm and damages to the Company which cannot be adequately compensated by a monetary award. Accordingly, it is expressly agreed that in addition to all other remedies available at law or in equity, the Company shall be entitled to seek injunctive or other equitable relief to restrain or enjoin Employee from breaching any such covenant or to specifically enforce the provisions of Section 7 above. 9.2 No Limitation of Remedies. Notwithstanding the provisions set ---------------------------- forth in Section 9.1 of this Agreement or any other provision contained in this Agreement, the parties hereby agree that no remedy conferred by any of the specific provisions of this Agreement, including without limitation, this Section 9, is intended to be exclusive of any other remedy, and each and every remedy shall be cumulative and shall be in addition to every other remedy given hereunder or now or hereafter existing at law or in equity or by statute or otherwise. 10. Representations and Warranties. Employee hereby represents and warrants to the Company as follows: 10.1 Acquisition Entirely for Own Account. Employee agrees that ---------------------------------------- Employee is acquiring the shares of the Company ("Shares") for investment purposes only, for Employee's own account, and not for sale or with a view to distribution of all or any part of such Shares. Employee has no contract, undertaking, agreement or arrangement with any person or entity to sell, hypothecate, pledge, donate, or otherwise transfer (with or without consideration) the Shares or any portion thereof, and Employee has no present plans or intention to enter any such contract, undertaking agreement or arrangement. 10.2 Accredited Investor. With respect to the acquisition of the -------------------- Shares, Employee qualifies as an "accredited investor" as that term is defined in Rule 501 of Regulation D under the Securities Act of 1933, as amended (the "Securities Act"). 10.3 Investment Experience. Employee acknowledges and understands --------------------- that an investment in the Company is speculative in nature and involves a high degree of risk, and that the Company has no financial or operating history. Employee acknowledges that Employee is able to fend for himself/herself, can bear the economic risk of Employee's investment, and has such knowledge and experience in financial or business matters that Employee is capable of evaluating the merits and risks of the investment in the Shares. 10.4 Restricted Shares. Employee acknowledges that Employee was ------------------ informed that the Shares are not registered under the Securities Act or applicable state laws, and that such Shares are "restricted Shares" and may not be transferred or otherwise disposed of unless subsequently registered under the Securities Act or such laws, or unless an exemption from such registration is available. 11. Miscellaneous. 11.1 Successors and Assigns. This Agreement is in the nature of a ------------------------ personal services contract; and neither party shall assign this Agreement without the prior written consent of the other party. This Agreement shall be binding on and inure to the benefit of the parties hereto and their respective successors, assigns, heirs and legal Representatives. 11.2 Governing Law. This Agreement shall be construed under and in -------------- accordance with, and governed in all respects by, the laws of the State of California (without giving effect to principles of conflicts of law). 11.3 Waiver. The failure of the Company to insist on strict compliance ------ with any of the terms, covenants, or conditions of this Agreement by any other party shall not be deemed a waiver of that term, covenant or condition, nor shall any waiver or relinquishment of any right or power at any one time or times be deemed a waiver or relinquishment of that right or power for all or any other times. 11.4 Notices. Any notice or other communication required or permitted ------- hereunder (each, a "Notice") shall be in writing, and shall be deemed to have been given (a) two (2) days following deposit of such Notice in the United States mail, certified, postage prepaid, return receipt requested, or (b) upon receipt if delivered personally, or delivered by reputable, recognized third party overnight delivery service or courier service or (c) the next business day following receipt, if transmitted by facsimile (provided that such facsimile is followed by the deposit of the original Notice, or a copy thereof, in the United States mail, certified, postage prepaid, return receipt requested, no later than the next business day following transmission of such facsimile), addressed to the parties as follows: To Employee: Mr. Thomas Blake ----------------------------- ----------------------------- ----------------------------- To the Company: TransWorld Benefits, Inc. Attn: _________________________ 2041 Business Center Drive, Suite 201 Irvine, California 92612 Either party may require such Notices to be delivered and given to any address different from or additional to the address set forth above, by delivering Notice thereof to the other party pursuant to this Section. 11.5 Arbitration. Any controversy arising out of or relating to this ------------ Agreement shall be settled by arbitration in Orange County, California in accordance with the Commercial Arbitration Rules of the American Arbitration Association before a single arbitrator agreed to by the parties. If no agreement can be reached regarding the selection of such arbitrator, the American Arbitration Association shall deliver to the parties a list with the names of three qualified arbitrators. Each party shall select a single name. The name not selected by either party or, in the alternative, selected by both parties shall be the arbitrator of such controversy. The decision of the arbitrator shall be binding and non-appealable. The parties hereto consent to the jurisdiction of the Superior Court of the State of California for the County of Orange and of the United States District Court of the Southern District for all purposes in connection with such arbitration, including the entry of judgment on any award. 11.6 Amendments. This Agreement, together with the attached ---------- Schedule(s), constitutes the entire agreement of the parties hereto with respect to the employment and retention of Employee by the Company, and supersedes any and all prior and contemporaneous agreements, whether oral or in writing, between the parties hereto with respect to the subject matter hereof. This Agreement may not be amended, modified, altered or supplemented except by written agreement executed and delivered by the parties hereto. 11.7 Survival of Certain Rights and Obligations. The rights and ------------------------------------------ obligations of the parties hereto pursuant to Sections 7, 8.5, 9 and 10 of this Agreement shall survive the termination of this Agreement. 11.8 Severability. If any provision of this Agreement is held by a ------------ court of competent jurisdiction to be invalid, void or unenforceable, the remaining provisions shall nevertheless continue in full force without being impaired or invalidated in any way. If any court of competent jurisdiction holds any provision of this Agreement to be invalid, void or unenforceable with respect to any state, region or locality, such provision shall nevertheless continue in full force and effect in all other states, regions and localities to which such provision applies. 11.9 Further Assurances. The parties agree that, at any time and from ------------------- time to time during the Term, they will take any action and execute and deliver any document which the other party reasonably requests in order to carry out the purposes of this Agreement. 11.10 Counterparts. This Agreement may be executed in one or ------------ more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. 11.11 Attorneys' Fees. If any action at law or in equity is necessary ---------------- to enforce or interpret the terms of this Agreement, the prevailing party shall be entitled to recover any and all reasonable attorneys' fees, expert witness fees, costs and necessary disbursements in addition to any other relief to which such party may be entitled. 11.12 No Third Party Beneficiary. This Agreement is made and entered ---------------------------- into between the parties solely for the benefit of the parties, and not for the benefit of any other third party or entity. No third party or entity shall be deemed or considered a third party beneficiary of any covenant, promise or other provision of this Agreement or have any right to enforce any such covenant, promise or other provision against either or both parties. [signatures follow on next page] IN WITNESS WHEREOF, each of the parties hereto has duly executed this Agreement as of the date first above written. "Company" TRANSWORLD BENEFITS, INC., a Nevada corporation By: ---------------------------------------- Name: --------------------------------------- Title: -------------------------------------- "Employee" - --------------------------------------------- THOMAS BLAKE, an individual AMENDMENT TO EMPLOYMENT AGREEMENT (Thomas Blake) This AMENDMENT TO EMPLOYMENT AGREEMENT (this "Agreement") is dated and entered into effective as of June ______, 2002 (the "Effective Date"), by and between TRANSWORLD BENEFITS, INC. (fka Skyway Home, Inc.), a Nevada corporation (the "Company"), and THOMAS BLAKE, an individual ("Employee"). R E C I T A L S - - - - - - - - WHEREAS, the Company and Employee have executed and entered into that certain Employment Agreement, dated as of the Effective Date hereof (the "Employment Agreement"). WHEREAS, the parties desire to amend the Employment Agreement as set forth herein. A G R E E M E N T - - - - - - - - - NOW, THEREFORE, for and in consideration of the foregoing recitals, the mutual covenants, provisions and terms set forth in this Agreement and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Company and Employee agree as follows: 1. Amendment. Pursuant to Section 7 and other related sections of the Employment Agreement, Employee has agreed not to engage in any business or activity competitive with the business or activity of the Company, as more particularly described in Section 7 of the Employment Agreement. The Company hereby agrees to amend the Employment Agreement to permit Employee to engage in the activities described on Exhibit 1, attached hereto, for the permitted period --------- set forth in Exhibit 1. Employee hereby agrees as follows: (a) not to engage, --------- directly or indirectly, in any business or activity with any person or entity other than those described on Exhibit 1; and (b) following the expiration of the --------- applicable permitted period described on Exhibit 1, Employee shall immediately --------- cease engaging in such activity or business. 2. Effect of Amendment. Except as amended and modified by this Amendment, the Employment Agreement shall remain in full force and effect. 3. Miscellaneous. (a) Successors and Assigns. This Amendment is in the nature of a ------------------------ personal services contract; and neither party shall assign this Amendment without the prior written consent of the other party. This Amendment shall be binding on and inure to the benefit of the parties hereto and their respective successors, assigns, heirs and legal Representatives. (b) Governing Law. This Amendment shall be construed under and in -------------- accordance with, and governed in all respects by, the laws of the State of California (without giving effect to principles of conflicts of law). (c) Waiver. The failure of the Company to insist on strict compliance ------ with any of the terms, covenants, or conditions of this Amendment by any other party shall not be deemed a waiver of that term, covenant or condition, nor shall any waiver or relinquishment of any right or power at any one time or times be deemed a waiver or relinquishment of that right or power for all or any other times. (d) Counterparts. This Amendment may be executed in one or more ------------ counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. IN WITNESS WHEREOF, each of the parties hereto has duly executed this Amendment as of the date first above written. "Company" TRANSWORLD BENEFITS, INC., a Nevada corporation By: ---------------------------------------- Name: --------------------------------------- Title: -------------------------------------- "Employee" - --------------------------------------------- THOMAS BLAKE, an individual "Company" Exhibit 1 Permitted Activities - -------------------------------------------------------------------------------- Permitted Activity. Permitted Period: Employee may engage in the - ------------------- ----------------- corresponding permitted activity during the period set forth below. Following the expiration of such period, Employee may not engage in such activity either directly or indirectly: - -------------------------------------------------------------------------------- 1. 1. 60 days from October 1, 2002 - -------------------------------------------------------------------------------- Schedule 1 Description of Duties During the Term, Employee shall perform the following services: (1) Serve as Vice-President of the Division of Insurance Group for the Company, including, without limitation, the following: (a) managing insurance underwriting and product administration. (b) providing administrative services and insurance and corporate sales. (c) managing the sales and marketing of such division in accordance with the Sales Territory Business Plan; (d) managing direct mail and other programs for such division in accordance with the Sales Territory Business Plan; and (e) hiring and supervising vice presidents of sales in accordance with the Sales Territory Business Plan. (2) Serve as a member of the Company's Executive Committee. Schedule 2 Sales Territory Business Plan; Schedule of Commissions (See attached pages) EMPLOYMENT AGREEMENT (Pirjo Jarvis) This EMPLOYMENT AGREEMENT (this "Agreement") is dated and entered into effective as of ______, 2002 (the "Effective Date"), by and between TRANSWORLD BENEFITS, INC. (fka Skyway Home, Inc.), a Nevada corporation (the "Company"), and PIRJO JARVIS, an individual ("Employee"). R E C I T A L S - - - - - - - - WHEREAS, the Company is a corporation formed and duly qualified in the State of Nevada. WHEREAS, the Company desires to engage Employee to perform certain services, and Employee desires to provide such services to the Company, upon the terms and conditions of this Agreement. A G R E E M E N T - - - - - - - - - NOW, THEREFORE, for and in consideration of the foregoing recitals, the mutual covenants, provisions and terms set forth in this Agreement and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Company and Employee agree as follows: 1. Engagement. The Company hereby employs Employee, and Employee hereby accepts such employment, to provide the "Services" (as defined below) upon the terms and conditions set forth in this Agreement. 2. Services. During the "Term" (as defined below) of this Agreement, Employee shall perform those services and duties as more described in Schedule 1 ---------- attached hereto (collectively, the "Services"). Employee shall have, subject to the direction, supervision and control of the Board of Directors of the Company (the "Board") and the Chief Executive Officer of the Company ("CEO"), and Employee agrees to faithfully perform, such duties as are typically performed by the president of a comparably-sized company engaged in activities comparable to the business of the Company, and such additional duties consistent with such office as may be assigned from time to time by the Board or the CEO. During the Term, Employee shall report to the Board and the CEO. 3. Term. Unless terminated earlier as provided in this Agreement, the Company retains Employee to provide the Services for a term beginning on November 1, 2002 (the "Start Date") and ending on October 31, 2005 (the "Term"). Thereafter, the Term shall be automatically extended for successive periods of one (1) year unless either the Company or Employee gives the other a written notice electing not to extend the Term, given not less than three (3) months prior to the date upon which any such extension would otherwise begin. As used herein, the term "Term" means the original term and any extension thereof. 4. Time and Effort. Employee shall perform the Services under this Agreement in a diligent and competent manner. During the Term, Employee shall perform the Services for the Company on a full-time basis. 5. Compensation. In consideration of Employee's performance of the Services hereunder and other covenants and agreements of Employee hereunder, the Company shall provide to Employee the compensation set forth in this Section 5. 5.1 Advancements. During the Term and subject to the terms and ------------ conditions set forth in Section 5.2 hereof, Employee shall receive advancements against future "Commissions" (as defined in Section 5.2 hereof ) (each, an "Advancement") as follows, payable in accordance with the Company's payroll procedures: (i) During the first year of the Term, Employee shall receive total Advancements equal to: (a) One Hundred Twenty Thousand Dollars ($120,000); plus (b) a signing bonus of Fifty Thousand Dollars ($50,000); and (ii) During the second year of the Term and during each subsequent year thereafter, Employee shall receive Advancements in a total amount equal to One Hundred Twenty Thousand Dollars ($120,000) per year. 5.2 Commissions. During the Term, the Company shall pay to ----------- Employee the "Commissions" in the amounts set forth and as calculated pursuant to the terms of Schedule 2, attached hereto and incorporated herein by this ----------- reference (the "Sales Territory Business Plan"), subject to the following terms and conditions: (i) During the first year of the Term, fifty (50%) of any and all Commissions earned and payable to Employee during any such payment period shall be used to reduce the Advancements made to Employee pursuant to Section 5.1(i) above. Notwithstanding the foregoing to the contrary, during the first year, Employee's total compensation shall not be reduced to less than One Hundred Seventy Thousand Dollars ($170,000). For example, if no Commissions were earned and payable to Employee during the first year of the Term, Employee shall be entitled to retain the entire $170,000 of Advancements received by Employee pursuant to Section 5.1(i) hereof. (ii) After the first year of the Term, one hundred percent (100%) of any and all Commissions earned and payable to Employee during any such payment period shall be used to reduce any outstanding balance of the Advancements made by the Company to Employee during the term of this Agreement (excluding the Advancements made by the Company to Employee during the first year of the Term as set forth in Section 5.1(i) hereof), until such time as such outstanding balance is reduced to zero. (iii) In the event that Employee's employment is terminated by the Company with "cause" (as defined in Section 8.4.2 hereof) or terminated by Employee with or without cause, Employee shall repay to the Company the outstanding balance of the Advancements made by the Company to Employee during the term of this Agreement (excluding the Advancements made by the Company to Employee during the first year of the Term as set forth in Section 5.1(i) hereof), by no later than seven (7) days following such termination, from any Commissions due and payable to the Employee pursuant to Schedule 2. (iv) Employee hereby acknowledges, understands and agrees that (A) any and all Commissions shall be calculated pursuant to the terms of the Sales Territory Business Plan as set forth in the attached Schedule 2, ---------- subject to the terms and conditions set forth in this Agreement; and (B) Employee shall perform such duties and obligations set forth in the Sales Territory Business Plan, including, without limitation, the hiring and paying the salaries and expenses of employees. 5.3 Right of First Refusal. In the event that the Company is ------------------------- involved in any future offering of shares in the Company, Employee shall have the right of first refusal to purchase, at the purchase price offered to other investors, such number of shares of the Company under such offering so that Employee's total interest in the Company will not be less than two percent (2%) of the total issued and outstanding shares of capital stock in the Company (as determined on a fully diluted, as converted basis). 5.4 Stock Option Plan. A stock option plan (the "Plan") is being ------------------ established by the Company. Employee shall be entitled to receive options to purchase shares under the Plan equal to two percent (2%) of the total issued and outstanding shares of capital stock in the Company as of the Start Date (as determined on a fully diluted, as converted basis) (the "Optioned Shares"). Subject to the terms set forth herein and in the Plan, Employee shall have the right to purchase 1/3 of the Optioned Shares at each anniversary of the Start Date. Employee shall be entitled to receive such other shares under the Plan as determined by the Company's board of directors in its discretion. Employee hereby acknowledges that Employee's right, title and interest in and to any option granted under this Section 5.4 shall be subject to the terms and conditions set forth in the Plan. 6. Other Benefits. Employee shall be entitled to the following: 6.1 Reimbursement of Expenses. The Company shall reimburse --------------------------- Employee for all business-related expenses and costs actually incurred by Employee in the performance of the Services under this Agreement pursuant to the terms set forth in the Sales Territory Business Plan. In addition, the reimbursement of all such costs and expenses shall be subject to reasonable policies and procedures established from time to time by the Company, including, without limitation, as those set forth in the Company's Employee Handbook, as amended. 6.2 Paid Vacation. During the Term, Employee shall be entitled to ------------- such period of paid vacation as available to other employees of the Company as set forth in the Company's Employee Handbook, as amended. Notwithstanding the foregoing, during the first three (3) years of the Term, vacation shall not be taken more than two (2) weeks consecutively. 6.3 Car Allowance. During the Term, the Company will provide -------------- Employee with a car allowance of Seven Hundred Dollars ($700) per month pursuant to the terms set forth in the Sales Territory Business Plan. 6.4 Insurance. During the Term, Employee shall receive full medical ---------- coverage generally available to the Company's other executive and managerial employees. In addition, Employee shall be entitled to receive all other benefits of employment generally available to Company's other executive and managerial employees when and as Employee becomes eligible for them, including dental, life insurance and disability plans. 7. Work Products/Confidentiality/Non-Competition. 7.1 Work Products. Employee hereby acknowledges and agrees that any -------------- and all "Work Products" (as defined below) which may have been or are made, developed or conceived of in whole or in part by Employee, or any of Employee's Representatives, in connection with services provided on behalf of the Company or relating to the business of the Company, shall belong solely and exclusively to the Company. Employee shall assign or cause its Representatives to assign to the Company such Employee's or Representative's entire right, title and interest, including all patent, copyright, trade secret, trademark and other proprietary rights, in any and all Work Products. The term "Work Products" means and includes, without limitation, a discovery, a development, a design, an improvement, an invention, a know-how, technical or non-technical data, a formula, a pattern, a compilation, a program, a device, a method, a technique, a drawing, a process, financial data, financial plans, product plans, business plans, software programs (including the object and source code thereto) or a list (whether in written form or otherwise) of actual or potential customers or suppliers, which is not commonly known by or available to the public and which information (i) derives economic value, actual or potential, from not being generally known to and not being readily ascertainable by proper means by other persons who can obtain economic value from its disclosure or use and (ii) is the subject of efforts that are reasonable under the circumstances to maintain its secrecy. 7.2 Business Opportunities. Employee covenants and agrees that ----------------------- any business opportunity which Employee or Employee's "Representatives" (as defined herein) might have during the term of this Agreement which relates to the business of the Company shall first be offered to the Company. If the Company rejects such offer, Employee shall be free to pursue such opportunity. The term "Representative" means and includes, with respect to any person or entity, each shareholder, director, officer, manager, constituent member, constituent partner, trustor, beneficiary, trustee, successor-in-interest, predecessor-in-interest, "Affiliate" (as defined in Section 7.4 hereof), employee, agent, attorney or other representative of such party, expressly excluding however, with respect to each party to this Agreement, the other party to this Agreement. 7.3 Proprietary Information. In the course of Employee's employment by ----------------------- the Company, each of Employee and Employee's Representatives, has had, and will continue to have, access to confidential and proprietary information regarding the Company and its business, including, but not limited to, information regarding the Company's technologies, methods and techniques, product information, specifications, technical drawings and designs, trade secrets, know-how, sources of supply, product and market research data, customer lists, marketing plans, and financial information regarding the Company and its operations. Such information shall be referred to hereinafter as "Proprietary Information" and shall include any and all of the information of the type described and shall also include any and all other confidential and proprietary information relating to the business to be conducted by the Company, whether previously existing, now existing or arising hereafter, whether conceived or developed by others or by Employee alone or with others, and whether or not conceived or developed during regular working hours. Proprietary Information which is released into the public domain during the period of Employee's employment under this Agreement, provided the same is not in the public domain as a consequence of disclosure directly or indirectly by Employee in violation of this Agreement, shall not be subject to the restrictions of this Section. 7.3.1 Fiduciary Obligations. Employee acknowledges that the Company ---------------------- has taken all reasonable steps in protecting the secrecy of the Proprietary Information, that said Proprietary Information is of critical importance to the Company and that a violation of this Section of this Agreement would seriously and irreparably impair and damage the Company's business. Accordingly, Employee agrees that it shall keep (and shall use its commercially reasonable best efforts to cause its Representatives to keep) all Proprietary Information in a fiduciary capacity for the sole benefit of the Company. 7.3.2 Non-Disclosure. Employee shall not, directly or indirectly, -------------- use or disclose (except as Employee's duties may require and except as required by law) any Proprietary Information to any person other than the Company, any employees of the Company who are authorized, at the time of such disclosure, to receive such information, or such other persons to whom Employee has been specifically instructed to make disclosure by the Board of Directors of the Company and in all such cases only to the extent required in the course of Employee's employment by the Company. At the termination of this Agreement, Employee shall deliver to the Company all notes, letters, documents, records, computer files, programs and other media which may contain Proprietary Information which are then in its possession or control and shall not retain or use any copies or summaries thereof. 7.4 Non-Competition. During the Term and for the two year period --------------- following the termination or expiration of the Term (such periods referred to collectively as the "Restriction Period"), neither Employee nor any of Employee's "Affiliates" (as defined below) shall, directly or indirectly, engage in, become employed by, serve as an agent or consultant to, or become a constituent member, partner, principal or stockholder (other than a holder of less than 5% of the outstanding voting shares of any publicly-held company) of any person or entity which engages directly or indirectly in any business or activity competitive with any business or activity engaged in by the Company or any of its subsidiaries. "Affiliates" shall mean and include, with respect to any other person or entity, any person or entity that directly or indirectly through one or more intermediaries controls or is controlled by, or is under common control with such person or entity. 7.5 Non-Solicitation of Employees. During the Restriction Period, ----------------------------- neither Employee nor any of Employee's Affiliates shall, directly or indirectly, for Employee's own account or for the account of any other person or entity with which Employee is or shall become associated in any capacity, (a) solicit for employment, employ or otherwise interfere with the relationship of the Company or any of its Affiliates, any person who at any time during the six months preceding such solicitation, employment or interference is or was employed by or otherwise engaged to perform services for the Company or any of its Affiliates, other than any such solicitation or employment during Employee's employment with the Company on behalf of the Company, or (b) induce any employee of the Company or any of its Affiliates who is a member of management to engage in any activity which Employee is prohibited from engaging in under any of this Section hereof or to terminate Employee's employment with the Company. 7.6 Non-Solicitation of Customers. During the Restriction Period, ----------------------------- neither Employee nor any of Employee's Affiliates shall, directly or indirectly, solicit or otherwise attempt to establish for Employee or any other person, firm or entity any business relationship of a nature that is competitive with the business or relationship of the Company or any of its Affiliates, with any person, firm or corporation which, during the twelve-month period preceding the date Employee's employment with the Company and its Affiliates terminates, was a customer, client or distributor of the Company or any of its Affiliates, other than any such solicitation during Employee's employment with the Company or on behalf of the Company. 8. Termination. 8.1 Termination Upon Death. If Employee dies during the Term, this ------------------------ Agreement shall terminate. Upon such termination, Employee shall be entitled to all accrued and unpaid compensation due under Section 5 above and the other obligations of the Company under this Agreement shall cease as of the date of the termination. 8.2 Termination Upon Permanent Disability. In the event of the ---------------------------------------- "Permanent Disability" (as hereinafter defined) of Employee, the Company may terminate this Agreement pursuant to the terms and conditions set forth in the Company's Employee Handbook, as amended. For the purposes of this Agreement, Employee shall be deemed to have suffered "Permanent Disability" in the event that Employee has become disabled by physical or mental illness or injury to the extent that the Board of Directors of the Company reasonably believes, notwithstanding such reasonable accommodations as the Company may make in response to such disability, that Employee cannot carry out or perform Employee's duties hereunder. In the event that the Company terminates this Agreement following Employee's Permanent Disability, other than accrued and unpaid compensation due to Employee, the compensation obligations of the Company under Section 5 hereof and any other obligations of the Company under this Agreement shall cease as of the date of the termination. 8.3 Termination by Employee. ------------------------- 8.3.1 Employee may terminate this Agreement without cause at any time and for any reason upon sixty (60) days' notice to the Company. 8.3.2 Employee may immediately terminate this Agreement for cause at any time by written notice to the Company. For purposes of this Agreement, the term "cause" for termination by Employee shall be (a) a breach by the Company of any material covenant or obligation hereunder; or (b) the voluntary or involuntary dissolution of the Company. The written notice given hereunder by Employee to the Company shall specify in reasonable detail the cause for termination, and, in the case of the cause described in (a) above, such termination notice shall not be effective until thirty (30) days after the Company's receipt of such notice, during which time the Company shall have the right to respond to Employee's notice and cure the breach or other event giving rise to the termination. In the event that the Company is able to cure, this Agreement shall continue in full force and effect. 8.4 Termination by the Company. ----------------------------- 8.4.1 The Company may terminate this Agreement without cause at any time and for any reason upon sixty (60) days' notice to Employee. 8.4.2 The Company may terminate this Agreement for cause at any time by written notice to Employee. For purposes of this Agreement, the term "cause" for termination by the Company shall be (a) a conviction of or plea of guilty or nolo contendre by Employee to a felony; (b) any action or activity of Employee which could reasonably be expected to have a material adverse effect on the Company, its business, its goodwill or its prospects; (c) the refusal by Employee to perform its material duties and obligations hereunder; or (d) Employee's gross negligence or willful and intentional misconduct in the performance of its duties and obligations. The written notice given hereunder by the Company to Employee shall specify in reasonable detail the cause for termination. In the case of a termination for the cause described in (a) above, such termination shall be effective upon receipt of the written notice. In the case of the causes described in (b) through (d) above, such termination notice shall not be effective until thirty (30) days after Employee's receipt of such notice, during which time Employee shall have the right to respond to the Company's notice and cure the breach or other event giving rise to the termination. In the event that Employee is able to cure, this Agreement shall continue in full force and effect. 8.5 Effect of Termination. Upon any termination of this ----------------------- Agreement, the obligations and covenants of the parties hereunder shall be of no further force and effect, except as provided in Section 11.7 below and as set forth in this Section 8.5. Upon any termination of this Agreement by Employee or the Company pursuant to Section 8 hereof, (a) the Company shall pay to Employee all accrued and unpaid compensation as of the date of such termination subject to the terms and conditions set forth in this Agreement; (b) if termination by the Company based on "cause" or by the Employee, Employee shall repay to the Company any outstanding balance of the Advancements made to Employee pursuant to Section 5.1(ii) hereof; and (c) all other obligations of the Company under this Agreement shall cease as of the date of such termination, including, without limitation, the right of Employee with respect to any unvested rights or shares granted herein or any future offering by the Company. 8.6 Effect of Combination or Dissolution. This Agreement shall not --------------------------------------- be terminated by the voluntary or involuntary dissolution of the Company, or by any merger or consolidation in which the Company is not the surviving or resulting entity, or any transfer of all or substantially all of the assets of the Company, or upon any transfer of a majority of the ownership interests of the Company by one or more members in one or more transactions, or upon the issuance of units of membership interests of the Company constituting a majority of the outstanding units immediately following such issuance. Instead, subject to Employee's right to terminate this Agreement pursuant to Section 8.3 above, the provisions of this Agreement shall be binding on and inure to the benefit of the Company's creditors, the surviving business entity or the business entity to which such units or assets shall be transferred. 9. Remedies. 9.1 Injunctive Relief. Employee acknowledges and agrees that (i) ------------------ the covenants and the restrictions contained in Section 7 above are necessary, fundamental, and required for the protection of the Company's business; (ii) such covenants relate to matters which are of a special, unique, and extraordinary character that gives each of such covenants a unique and extraordinary value; and (iii) a breach of any of such covenants will result in irreparable harm and damages to the Company which cannot be adequately compensated by a monetary award. Accordingly, it is expressly agreed that in addition to all other remedies available at law or in equity, the Company shall be entitled to seek injunctive or other equitable relief to restrain or enjoin Employee from breaching any such covenant or to specifically enforce the provisions of Section 7 above. 9.2 No Limitation of Remedies. Notwithstanding the provisions set ---------------------------- forth in Section 9.1 of this Agreement or any other provision contained in this Agreement, the parties hereby agree that no remedy conferred by any of the specific provisions of this Agreement, including without limitation, this Section 9, is intended to be exclusive of any other remedy, and each and every remedy shall be cumulative and shall be in addition to every other remedy given hereunder or now or hereafter existing at law or in equity or by statute or otherwise. 10. Representations and Warranties. Employee hereby represents and warrants to the Company as follows: 10.1 Acquisition Entirely for Own Account. Employee agrees that ---------------------------------------- Employee is acquiring the shares of the Company ("Shares") for investment purposes only, for Employee's own account, and not for sale or with a view to distribution of all or any part of such Shares. Employee has no contract, undertaking, agreement or arrangement with any person or entity to sell, hypothecate, pledge, donate, or otherwise transfer (with or without consideration) the Shares or any portion thereof, and Employee has no present plans or intention to enter any such contract, undertaking agreement or arrangement. 10.2 Accredited Investor. With respect to the acquisition of the -------------------- Shares, Employee qualifies as an "accredited investor" as that term is defined in Rule 501 of Regulation D under the Securities Act of 1933, as amended (the "Securities Act"). 10.3 Investment Experience. Employee acknowledges and understands --------------------- that an investment in the Company is speculative in nature and involves a high degree of risk, and that the Company has no financial or operating history. Employee acknowledges that Employee is able to fend for himself/herself, can bear the economic risk of Employee's investment, and has such knowledge and experience in financial or business matters that Employee is capable of evaluating the merits and risks of the investment in the Shares. 10.4 Restricted Shares. Employee acknowledges that Employee was ------------------ informed that the Shares are not registered under the Securities Act or applicable state laws, and that such Shares are "restricted Shares" and may not be transferred or otherwise disposed of unless subsequently registered under the Securities Act or such laws, or unless an exemption from such registration is available. 11. Miscellaneous. 11.1 Successors and Assigns. This Agreement is in the nature of a ------------------------ personal services contract; and neither party shall assign this Agreement without the prior written consent of the other party. This Agreement shall be binding on and inure to the benefit of the parties hereto and their respective successors, assigns, heirs and legal Representatives. 11.2 Governing Law. This Agreement shall be construed under and in -------------- accordance with, and governed in all respects by, the laws of the State of California (without giving effect to principles of conflicts of law). 11.3 Waiver. The failure of the Company to insist on strict compliance ------ with any of the terms, covenants, or conditions of this Agreement by any other party shall not be deemed a waiver of that term, covenant or condition, nor shall any waiver or relinquishment of any right or power at any one time or times be deemed a waiver or relinquishment of that right or power for all or any other times. 11.4 Notices. Any notice or other communication required or ------- permitted hereunder (each, a "Notice") shall be in writing, and shall be deemed to have been given (a) two (2) days following deposit of such Notice in the United States mail, certified, postage prepaid, return receipt requested, or (b) upon receipt if delivered personally, or delivered by reputable, recognized third party overnight delivery service or courier service or (c) the next business day following receipt, if transmitted by facsimile (provided that such facsimile is followed by the deposit of the original Notice, or a copy thereof, in the United States mail, certified, postage prepaid, return receipt requested, no later than the next business day following transmission of such facsimile), addressed to the parties as follows: To Employee: Ms. Pirjo Jarvis ___________________________ ___________________________ ___________________________ To the Company: TransWorld Benefits, Inc. Attn: _________________________ 2041 Business Center Drive, Suite 201 Irvine, California 92612 Either party may require such Notices to be delivered and given to any address different from or additional to the address set forth above, by delivering Notice thereof to the other party pursuant to this Section. 11.5 Arbitration. Any controversy arising out of or relating to this ------------ Agreement shall be settled by arbitration in Orange County, California in accordance with the Commercial Arbitration Rules of the American Arbitration Association before a single arbitrator agreed to by the parties. If no agreement can be reached regarding the selection of such arbitrator, the American Arbitration Association shall deliver to the parties a list with the names of three qualified arbitrators. Each party shall select a single name. The name not selected by either party or, in the alternative, selected by both parties shall be the arbitrator of such controversy. The decision of the arbitrator shall be binding and non-appealable. The parties hereto consent to the jurisdiction of the Superior Court of the State of California for the County of Orange and of the United States District Court of the Southern District for all purposes in connection with such arbitration, including the entry of judgment on any award. 11.6 Amendments. This Agreement, together with the attached ---------- Schedule(s), constitutes the entire agreement of the parties hereto with respect to the employment and retention of Employee by the Company, and supersedes any and all prior and contemporaneous agreements, whether oral or in writing, between the parties hereto with respect to the subject matter hereof. This Agreement may not be amended, modified, altered or supplemented except by written agreement executed and delivered by the parties hereto. 11.7 Survival of Certain Rights and Obligations. The rights and ----------------------------------------------- obligations of the parties hereto pursuant to Sections 7, 8.5, 9 and 10 of this Agreement shall survive the termination of this Agreement. 11.8 Severability. If any provision of this Agreement is held by a ------------ court of competent jurisdiction to be invalid, void or unenforceable, the remaining provisions shall nevertheless continue in full force without being impaired or invalidated in any way. If any court of competent jurisdiction holds any provision of this Agreement to be invalid, void or unenforceable with respect to any state, region or locality, such provision shall nevertheless continue in full force and effect in all other states, regions and localities to which such provision applies. 11.9 Further Assurances. The parties agree that, at any time and from ------------------- time to time during the Term, they will take any action and execute and deliver any document which the other party reasonably requests in order to carry out the purposes of this Agreement. 11.10 Counterparts. This Agreement may be executed in one or ------------ more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. 11.11 Attorneys' Fees. If any action at law or in equity is necessary ---------------- to enforce or interpret the terms of this Agreement, the prevailing party shall be entitled to recover any and all reasonable attorneys' fees, expert witness fees, costs and necessary disbursements in addition to any other relief to which such party may be entitled. 11.12 No Third Party Beneficiary. This Agreement is made and entered ---------------------------- into between the parties solely for the benefit of the parties, and not for the benefit of any other third party or entity. No third party or entity shall be deemed or considered a third party beneficiary of any covenant, promise or other provision of this Agreement or have any right to enforce any such covenant, promise or other provision against either or both parties. [signatures follow on next page] IN WITNESS WHEREOF, each of the parties hereto has duly executed this Agreement as of the date first above written. "Company" TRANSWORLD BENEFITS, INC., a Nevada corporation By: _______________________________________ Name: _____________________________________ Title:_____________________________________ "Employee" __________________________________________ PIRJO JARVIS, an individual Schedule 1 Description of Duties During the Term, Employee shall perform the following services: (1) Serve as President of the Company. (2) Serve on the Company's Executive Committee. (3) Manage matters in connection with Company's personnel and human resources. (4) Manage, supervise, oversee, and handle the Company's day-to-day operations. (5) Serve as supervisor to the Company's Communications Director, subject to guidance from the Company's Vice President. (6) Supervise and manage Company's division for Travel and Credit Card Industries, including, without limitation, (a) managing the sales and marketing of such division; (b) managing direct mail and other programs for such division; and (c) hiring and supervising vice presidents of sales, in accordance with the Sales Territory Business Plan. Schedule 2 Sales Territory Business Plan; Schedule of Commissions (See attached pages) EMPLOYMENT AGREEMENT (Ronald Robertson) This EMPLOYMENT AGREEMENT (this "Agreement") is dated and entered into effective as of ______, 2001 (the "Effective Date"), by and between TRANSWORLD BENEFITS, INC. (fka Skyway Home, Inc.), a Nevada corporation (the "Company"), and RONALD ROBERTSON, an individual ("Employee"). R E C I T A L S - - - - - - - - WHEREAS, the Company is a corporation formed and duly qualified in the State of Nevada. WHEREAS, the Company desires to engage Employee to perform certain services, and Employee desires to provide such services to the Company, upon the terms and conditions of this Agreement. A G R E E M E N T - - - - - - - - - NOW, THEREFORE, for and in consideration of the foregoing recitals, the mutual covenants, provisions and terms set forth in this Agreement and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Company and Employee agree as follows: 1. Engagement. The Company hereby employs Employee, and Employee hereby accepts such employment, to provide the "Services" (as defined below) upon the terms and conditions set forth in this Agreement. 2. Services. During the "Term" (as defined below) of this Agreement, Employee shall perform those services and duties as more described in Schedule 1 ---------- attached hereto (collectively, the "Services"). Employee shall have, subject to the direction, supervision and control of the Board of Directors of the Company (the "Board") and the Chief Executive Officer of the Company ("CEO"), and Employee agrees to faithfully perform, such additional duties consistent with such office as may be assigned from time to time by the Board or the CEO. During the Term, Employee shall report to the Board and the CEO. 3. Term. Unless terminated earlier as provided in this Agreement, the Company retains Employee to provide the Services for a term beginning on October 1, 2001 (the "Start Date") and ending on September 30, 2005 (the "Term"). Thereafter, the Term shall be automatically extended for successive periods of one (1) year unless either the Company or Employee gives the other a written notice electing not to extend the Term, given not less than three (3) months prior to the date upon which any such extension would otherwise begin. As used herein, the term "Term" means the original term and any extension thereof. 4. Time and Effort. Employee shall perform the Services under this Agreement in a diligent and competent manner. During the Term, Employee shall perform the Services for the Company on a full-time basis. 5. Compensation. In consideration of Employee's performance of the Services hereunder and other covenants and agreements of Employee hereunder, the Company shall provide to Employee the compensation set forth in this Section 5. 5.1 Advancements. During the Term and subject to the terms and ------------ conditions set forth in Section 5.2 hereof, Employee shall receive advancements against future "Commissions" (as defined in Section 5.2 hereof) (each, an "Advancement") as follows, payable in accordance with the Company's payroll procedures: (i) During the first year of the Term, Employee shall receive total Advancements equal to: (a) One Hundred Twenty Thousand Dollars ($120,000); plus (b) a signing bonus of Thirty Thousand Dollars ($30,000) paid over the first twelve (12) months commencing on October 1, 2001; and (ii) During the second year of the Term and during each subsequent year thereafter, Employee shall receive Advancements in a total amount equal to One Hundred Twenty Thousand Dollars ($120,000) per year. 5.2 Commissions. During the Term, the Company shall pay to Employee ----------- the "Commissions" in the amounts set forth and as calculated pursuant to the terms of Schedule 2, attached hereto and incorporated herein by this reference ---------- (the "Sales Territory Business Plan"), subject to the following terms and conditions: (i) During the first year of the Term, fifty (50%) of any and all Commissions earned and payable to Employee during any such payment period shall be used to reduce the Advancements made to Employee pursuant to Section 5.1(i) above. Notwithstanding the foregoing to the contrary, during the first year, Employee's total compensation shall not be reduced to less than One Hundred Fifty Thousand Dollars ($150,000). For example, if no Commissions were earned and payable to Employee during the first year of the Term, Employee shall be entitled to retain the entire $150,000 of Advancements received by Employee pursuant to Section 5.1(i) hereof. (ii) After the first year of the Term, one hundred percent (100%) of any and all Commissions earned and payable to Employee during any such payment period shall be used to reduce any outstanding balance of the Advancements made by the Company to Employee during the term of this Agreement (excluding the Advancements made by the Company to Employee during the first year of the Term as set forth in Section 5.1(i) hereof), until such time as such outstanding balance is reduced to zero. (iii) In the event that Employee's employment is terminated by the Company with "cause" (as defined in Section 8.4.2 hereof) or terminated by Employee with or without cause, Employee shall repay to the Company the outstanding balance of the Advancements made by the Company to Employee during the term of this Agreement (excluding the Advancements made by the Company to Employee during the first year of the Term as set forth in Section 5.1(i) hereof), by no later than seven (7) days following such termination. (iv) Employee hereby acknowledges, understands and agrees that (A) any and all Commissions shall be calculated pursuant to the terms of the Sales Territory Business Plan as set forth in the attached Schedule 2, subject to the ---------- terms and conditions set forth in this Agreement; and (B) Employee shall perform such duties and obligations set forth in the Sales Territory Business Plan, including, without limitation, the hiring and paying the salaries and expenses of employees. (v) Notwithstanding any provision contained herein to the contrary, Employee shall be compensated at the rate of ten percent (10%) until such time as Employee has received a total of $100,000 in bonus payment. 5.3 Right of First Refusal. In the event that the Company is ------------------------- involved in any future offering of shares in the Company, Employee shall have the right of first refusal to purchase, at the purchase price offered to other investors, such number of shares of the Company under such offering so that Employee's total interest in the Company will not be less than two percent (2%) of the total issued and outstanding shares of capital stock in the Company (as determined on a fully diluted, as converted basis). 5.4 Stock Option Plan. A stock option plan (the "Plan") is being ----------------- established by the Company. Employee shall be entitled to receive options to purchase shares under the Plan equal to two and half percent (2 1/2%) of the total issued and outstanding shares of capital stock in the Company as of the Start Date (as determined on a fully diluted, as converted basis) (the "Optioned Shares"). Subject to the terms set forth herein and in the Plan, Employee shall have the right to purchase 1/3 of the Optioned Shares at each anniversary of the Start Date. Employee shall be entitled to receive such other shares under the Plan as determined by the Company's board of directors in its discretion. Employee hereby acknowledges that Employee's right, title and interest in and to any option granted under this Section 5.4 shall be subject to the terms and conditions set forth in the Plan. 6. Other Benefits. Employee shall be entitled to the following: 6.1 Reimbursement of Expenses. The Company shall reimburse --------------------------- Employee for all business-related expenses and costs actually incurred by Employee in the performance of the Services under this Agreement pursuant to the terms set forth in the Sales Territory Business Plan. In addition, the reimbursement of all such costs and expenses shall be subject to reasonable policies and procedures established from time to time by the Company, including, without limitation, as those set forth in the Company's Employee Handbook, as amended. 6.2 Paid Vacation. During the Term, Employee shall be entitled to ------------- such period of paid vacation as available to other employees of the Company as set forth in the Company's Employee Handbook, as amended. Notwithstanding the foregoing, during the first three (3) years of the Term, vacation shall not be taken more than two (2) weeks consecutively. 6.3 Car Allowance. During the Term, the Company will provide -------------- Employee with a car allowance of Seven Hundred Dollars ($700) per month pursuant to the terms set forth in the Sales Territory Business Plan. 6.4 Insurance. During the Term, Employee shall receive full medical ---------- coverage generally available to the Company's other executive and managerial employees. In addition, Employee shall be entitled to receive all other benefits of employment generally available to Company's other executive and managerial employees when and as Employee becomes eligible for them, including dental, life insurance and disability plans. 6.5 Moving Expenses. The Company shall pay Employee moving ---------------- expenses as follows: (A) a total of Twenty Thousand Dollars ($20,000) for moving expenses; (B) approximately One Thousand Seven Hundred Dollars ($1,700) per month for six (6) months for payment on Employee's home in Pennsylvania, provided, however, such payments shall cease in the event that such home is sold during such six-month period; and (C) upon termination of Employee's services hereunder, a severance payment equal to the actual cost of moving less payments made by the Company pursuant to the foregoing subsection (A). 7. Work Products/Confidentiality/Non-Competition. 7.1 Work Products. Employee hereby acknowledges and agrees that any -------------- and all "Work Products" (as defined below) which may have been or are made, developed or conceived of in whole or in part by Employee, or any of Employee's Representatives, in connection with services provided on behalf of the Company or relating to the business of the Company, shall belong solely and exclusively to the Company. Employee shall assign or cause its Representatives to assign to the Company such Employee's or Representative's entire right, title and interest, including all patent, copyright, trade secret, trademark and other proprietary rights, in any and all Work Products. The term "Work Products" means and includes, without limitation, a discovery, a development, a design, an improvement, an invention, a know-how, technical or non-technical data, a formula, a pattern, a compilation, a program, a device, a method, a technique, a drawing, a process, financial data, financial plans, product plans, business plans, software programs (including the object and source code thereto) or a list (whether in written form or otherwise) of actual or potential customers or suppliers, which is not commonly known by or available to the public and which information (i) derives economic value, actual or potential, from not being generally known to and not being readily ascertainable by proper means by other persons who can obtain economic value from its disclosure or use and (ii) is the subject of efforts that are reasonable under the circumstances to maintain its secrecy. 7.2 Business Opportunities. Employee covenants and agrees that any ----------------------- business opportunity which Employee or Employee's "Representatives" (as defined herein) might have during the term of this Agreement which relates to the business of the Company shall first be offered to the Company. If the Company rejects such offer, Employee shall be free to pursue such opportunity. The term "Representative" means and includes, with respect to any person or entity, each shareholder, director, officer, manager, constituent member, constituent partner, trustor, beneficiary, trustee, successor-in-interest, predecessor-in-interest, "Affiliate" (as defined in Section 7.4 hereof), employee, agent, attorney or other representative of such party, expressly excluding however, with respect to each party to this Agreement, the other party to this Agreement. 7.3 Proprietary Information. In the course of Employee's employment by ----------------------- the Company, each of Employee and Employee's Representatives, has had, and will continue to have, access to confidential and proprietary information regarding the Company and its business, including, but not limited to, information regarding the Company's technologies, methods and techniques, product information, specifications, technical drawings and designs, trade secrets, know-how, sources of supply, product and market research data, customer lists, marketing plans, and financial information regarding the Company and its operations. Such information shall be referred to hereinafter as "Proprietary Information" and shall include any and all of the information of the type described and shall also include any and all other confidential and proprietary information relating to the business to be conducted by the Company, whether previously existing, now existing or arising hereafter, whether conceived or developed by others or by Employee alone or with others, and whether or not conceived or developed during regular working hours. Proprietary Information which is released into the public domain during the period of Employee's employment under this Agreement, provided the same is not in the public domain as a consequence of disclosure directly or indirectly by Employee in violation of this Agreement, shall not be subject to the restrictions of this Section. 7.3.1 Fiduciary Obligations. Employee acknowledges that the Company ---------------------- has taken all reasonable steps in protecting the secrecy of the Proprietary Information, that said Proprietary Information is of critical importance to the Company and that a violation of this Section of this Agreement would seriously and irreparably impair and damage the Company's business. Accordingly, Employee agrees that it shall keep (and shall use its commercially reasonable best efforts to cause its Representatives to keep) all Proprietary Information in a fiduciary capacity for the sole benefit of the Company. 7.3.2 Non-Disclosure. Employee shall not, directly or indirectly, use -------------- or disclose (except as Employee's duties may require and except as required by law) any Proprietary Information to any person other than the Company, any employees of the Company who are authorized, at the time of such disclosure, to receive such information, or such other persons to whom Employee has been specifically instructed to make disclosure by the Board of Directors of the Company and in all such cases only to the extent required in the course of Employee's employment by the Company. At the termination of this Agreement, Employee shall deliver to the Company all notes, letters, documents, records, computer files, programs and other media which may contain Proprietary Information which are then in its possession or control and shall not retain or use any copies or summaries thereof. 7.4 Non-Competition. During the Term and for the two year period --------------- following the termination or expiration of the Term (such periods referred to collectively as the "Restriction Period"), neither Employee nor any of Employee's "Affiliates" (as defined below) shall, directly or indirectly, engage in, become employed by, serve as an agent or consultant to, or become a constituent member, partner, principal or stockholder (other than a holder of less than 5% of the outstanding voting shares of any publicly-held company) of any person or entity which engages directly or indirectly in any business or activity competitive with any business or activity engaged in by the Company or any of its subsidiaries. "Affiliates" shall mean and include, with respect to any other person or entity, any person or entity that directly or indirectly through one or more intermediaries controls or is controlled by, or is under common control with such person or entity. 7.5 Non-Solicitation of Employees. During the Restriction Period, ----------------------------- neither Employee nor any of Employee's Affiliates shall, directly or indirectly, for Employee's own account or for the account of any other person or entity with which Employee is or shall become associated in any capacity, (a) solicit for employment, employ or otherwise interfere with the relationship of the Company or any of its Affiliates, any person who at any time during the six months preceding such solicitation, employment or interference is or was employed by or otherwise engaged to perform services for the Company or any of its Affiliates, other than any such solicitation or employment during Employee's employment with the Company on behalf of the Company, or (b) induce any employee of the Company or any of its Affiliates who is a member of management to engage in any activity which Employee is prohibited from engaging in under any of this Section hereof or to terminate Employee's employment with the Company. 7.6 Non-Solicitation of Customers. During the Restriction Period, ----------------------------- neither Employee nor any of Employee's Affiliates shall, directly or indirectly, solicit or otherwise attempt to establish for Employee or any other person, firm or entity any business relationship of a nature that is competitive with the business or relationship of the Company or any of its Affiliates, with any person, firm or corporation which, during the twelve-month period preceding the date Employee's employment with the Company and its Affiliates terminates, was a customer, client or distributor of the Company or any of its Affiliates, other than any such solicitation during Employee's employment with the Company or on behalf of the Company. 8. Termination. 8.1 Termination Upon Death. If Employee dies during the Term, this ------------------------ Agreement shall terminate. Upon such termination, Employee shall be entitled to all accrued and unpaid compensation due under Section 5 above and the other obligations of the Company under this Agreement shall cease as of the date of the termination. 8.2 Termination Upon Permanent Disability. In the event of the ---------------------------------------- "Permanent Disability" (as hereinafter defined) of Employee, the Company may terminate this Agreement pursuant to the terms and conditions set forth in the Company's Employee Handbook, as amended. For the purposes of this Agreement, Employee shall be deemed to have suffered "Permanent Disability" in the event that Employee has become disabled by physical or mental illness or injury to the extent that the Board of Directors of the Company reasonably believes, notwithstanding such reasonable accommodations as the Company may make in response to such disability, that Employee cannot carry out or perform Employee's duties hereunder. In the event that the Company terminates this Agreement following Employee's Permanent Disability, other than accrued and unpaid compensation due to Employee, the compensation obligations of the Company under Section 5 hereof and any other obligations of the Company under this Agreement shall cease as of the date of the termination. 8.3 Termination by Employee. ------------------------- 8.3.1 Employee may terminate this Agreement without cause at any time and for any reason upon sixty (60) days' notice to the Company. 8.3.2 Employee may immediately terminate this Agreement for cause at any time by written notice to the Company. For purposes of this Agreement, the term "cause" for termination by Employee shall be (a) a breach by the Company of any material covenant or obligation hereunder; or (b) the voluntary or involuntary dissolution of the Company. The written notice given hereunder by Employee to the Company shall specify in reasonable detail the cause for termination, and, in the case of the cause described in (a) above, such termination notice shall not be effective until thirty (30) days after the Company's receipt of such notice, during which time the Company shall have the right to respond to Employee's notice and cure the breach or other event giving rise to the termination. In the event that the Company is able to cure, this Agreement shall continue in full force and effect. 8.4 Termination by the Company. ----------------------------- 8.4.1 The Company may terminate this Agreement without cause at any time and for any reason upon sixty (60) days' notice to Employee. 8.4.2 The Company may terminate this Agreement for cause at any time by written notice to Employee. For purposes of this Agreement, the term "cause" for termination by the Company shall be (a) a conviction of or plea of guilty or nolo contendre by Employee to a felony; (b) any action or activity of Employee which could reasonably be expected to have a material adverse effect on the Company, its business, its goodwill or its prospects; (c) the refusal by Employee to perform its material duties and obligations hereunder; or (d) Employee's gross negligence or willful and intentional misconduct in the performance of its duties and obligations. The written notice given hereunder by the Company to Employee shall specify in reasonable detail the cause for termination. In the case of a termination for the cause described in (a) above, such termination shall be effective upon receipt of the written notice. In the case of the causes described in (b) through (d) above, such termination notice shall not be effective until thirty (30) days after Employee's receipt of such notice, during which time Employee shall have the right to respond to the Company's notice and cure the breach or other event giving rise to the termination. In the event that Employee is able to cure, this Agreement shall continue in full force and effect. 8.5 Effect of Termination. Upon any termination of this ----------------------- Agreement, the obligations and covenants of the parties hereunder shall be of no further force and effect, except as provided in Section 11.7 below and as set forth in this Section 8.5. Upon any termination of this Agreement by Employee or the Company pursuant to Section 8 hereof, (a) the Company shall pay to Employee all accrued and unpaid compensation as of the date of such termination subject to the terms and conditions set forth in this Agreement; (b) if termination by the Company based on "cause" or by the Employee, Employee shall repay to the Company any outstanding balance of the Advancements made to Employee pursuant to Section 5.1(ii) hereof; and (c) all other obligations of the Company under this Agreement shall cease as of the date of such termination, including, without limitation, the right of Employee with respect to any unvested rights or shares granted herein or any future offering by the Company. 8.6 Effect of Combination or Dissolution. This Agreement shall --------------------------------------- not be terminated by the voluntary or involuntary dissolution of the Company, or by any merger or consolidation in which the Company is not the surviving or resulting entity, or any transfer of all or substantially all of the assets of the Company, or upon any transfer of a majority of the ownership interests of the Company by one or more members in one or more transactions, or upon the issuance of units of membership interests of the Company constituting a majority of the outstanding units immediately following such issuance. Instead, subject to Employee's right to terminate this Agreement pursuant to Section 8.3 above, the provisions of this Agreement shall be binding on and inure to the benefit of the Company's creditors, the surviving business entity or the business entity to which such units or assets shall be transferred. 9. Remedies. 9.1 Injunctive Relief. Employee acknowledges and agrees that (i) the ------------------ covenants and the restrictions contained in Section 7 above are necessary, fundamental, and required for the protection of the Company's business; (ii) such covenants relate to matters which are of a special, unique, and extraordinary character that gives each of such covenants a unique and extraordinary value; and (iii) a breach of any of such covenants will result in irreparable harm and damages to the Company which cannot be adequately compensated by a monetary award. Accordingly, it is expressly agreed that in addition to all other remedies available at law or in equity, the Company shall be entitled to seek injunctive or other equitable relief to restrain or enjoin Employee from breaching any such covenant or to specifically enforce the provisions of Section 7 above. 9.2 No Limitation of Remedies. Notwithstanding the provisions set ---------------------------- forth in Section 9.1 of this Agreement or any other provision contained in this Agreement, the parties hereby agree that no remedy conferred by any of the specific provisions of this Agreement, including without limitation, this Section 9, is intended to be exclusive of any other remedy, and each and every remedy shall be cumulative and shall be in addition to every other remedy given hereunder or now or hereafter existing at law or in equity or by statute or otherwise. 10. Representations and Warranties. Employee hereby represents and warrants to the Company as follows: 10.1 Acquisition Entirely for Own Account. Employee agrees that ---------------------------------------- Employee is acquiring the shares of the Company ("Shares") for investment purposes only, for Employee's own account, and not for sale or with a view to distribution of all or any part of such Shares. Employee has no contract, undertaking, agreement or arrangement with any person or entity to sell, hypothecate, pledge, donate, or otherwise transfer (with or without consideration) the Shares or any portion thereof, and Employee has no present plans or intention to enter any such contract, undertaking agreement or arrangement. 10.2 Accredited Investor. With respect to the acquisition of the -------------------- Shares, Employee qualifies as an "accredited investor" as that term is defined in Rule 501 of Regulation D under the Securities Act of 1933, as amended (the "Securities Act"). 10.3 Investment Experience. Employee acknowledges and understands --------------------- that an investment in the Company is speculative in nature and involves a high degree of risk, and that the Company has no financial or operating history. Employee acknowledges that Employee is able to fend for himself/herself, can bear the economic risk of Employee's investment, and has such knowledge and experience in financial or business matters that Employee is capable of evaluating the merits and risks of the investment in the Shares. 10.4 Restricted Shares. Employee acknowledges that Employee was ------------------ informed that the Shares are not registered under the Securities Act or applicable state laws, and that such Shares are "restricted Shares" and may not be transferred or otherwise disposed of unless subsequently registered under the Securities Act or such laws, or unless an exemption from such registration is available. 11. Miscellaneous. 11.1 Successors and Assigns. This Agreement is in the nature of a ------------------------ personal services contract; and neither party shall assign this Agreement without the prior written consent of the other party. This Agreement shall be binding on and inure to the benefit of the parties hereto and their respective successors, assigns, heirs and legal Representatives. 11.2 Governing Law. This Agreement shall be construed under and in -------------- accordance with, and governed in all respects by, the laws of the State of California (without giving effect to principles of conflicts of law). 11.3 Waiver. The failure of the Company to insist on strict compliance ------ with any of the terms, covenants, or conditions of this Agreement by any other party shall not be deemed a waiver of that term, covenant or condition, nor shall any waiver or relinquishment of any right or power at any one time or times be deemed a waiver or relinquishment of that right or power for all or any other times. 11.4 Notices. Any notice or other communication required or permitted ------- hereunder (each, a "Notice") shall be in writing, and shall be deemed to have been given (a) two (2) days following deposit of such Notice in the United States mail, certified, postage prepaid, return receipt requested, or (b) upon receipt if delivered personally, or delivered by reputable, recognized third party overnight delivery service or courier service or (c) the next business day following receipt, if transmitted by facsimile (provided that such facsimile is followed by the deposit of the original Notice, or a copy thereof, in the United States mail, certified, postage prepaid, return receipt requested, no later than the next business day following transmission of such facsimile), addressed to the parties as follows: To Employee: Mr. Ronald Robertson _____________________________ _____________________________ _____________________________ To the Company: TransWorld Benefits, Inc. Attn: _________________________ 2041 Business Center Drive, Suite 201 Irvine, California 92612 Either party may require such Notices to be delivered and given to any address different from or additional to the address set forth above, by delivering Notice thereof to the other party pursuant to this Section. 11.5 Arbitration. Any controversy arising out of or relating to this ------------ Agreement shall be settled by arbitration in Orange County, California in accordance with the Commercial Arbitration Rules of the American Arbitration Association before a single arbitrator agreed to by the parties. If no agreement can be reached regarding the selection of such arbitrator, the American Arbitration Association shall deliver to the parties a list with the names of three qualified arbitrators. Each party shall select a single name. The name not selected by either party or, in the alternative, selected by both parties shall be the arbitrator of such controversy. The decision of the arbitrator shall be binding and non-appealable. The parties hereto consent to the jurisdiction of the Superior Court of the State of California for the County of Orange and of the United States District Court of the Southern District for all purposes in connection with such arbitration, including the entry of judgment on any award. 11.6 Amendments. This Agreement, together with the attached ---------- Schedule(s), constitutes the entire agreement of the parties hereto with respect to the employment and retention of Employee by the Company, and supersedes any and all prior and contemporaneous agreements, whether oral or in writing, between the parties hereto with respect to the subject matter hereof. This Agreement may not be amended, modified, altered or supplemented except by written agreement executed and delivered by the parties hereto. 11.7 Survival of Certain Rights and Obligations. The rights and ----------------------------------------------- obligations of the parties hereto pursuant to Sections 7, 8.5, 9 and 10 of this Agreement shall survive the termination of this Agreement. 11.8 Severability. If any provision of this Agreement is held by a ------------ court of competent jurisdiction to be invalid, void or unenforceable, the remaining provisions shall nevertheless continue in full force without being impaired or invalidated in any way. If any court of competent jurisdiction holds any provision of this Agreement to be invalid, void or unenforceable with respect to any state, region or locality, such provision shall nevertheless continue in full force and effect in all other states, regions and localities to which such provision applies. 11.9 Further Assurances. The parties agree that, at any time and from ------------------- time to time during the Term, they will take any action and execute and deliver any document which the other party reasonably requests in order to carry out the purposes of this Agreement. 11.10 Counterparts. This Agreement may be executed in one or more ------------ counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. 11.11 Attorneys' Fees. If any action at law or in equity is necessary ---------------- to enforce or interpret the terms of this Agreement, the prevailing party shall be entitled to recover any and all reasonable attorneys' fees, expert witness fees, costs and necessary disbursements in addition to any other relief to which such party may be entitled. 11.12 No Third Party Beneficiary. This Agreement is made and entered ---------------------------- into between the parties solely for the benefit of the parties, and not for the benefit of any other third party or entity. No third party or entity shall be deemed or considered a third party beneficiary of any covenant, promise or other provision of this Agreement or have any right to enforce any such covenant, promise or other provision against either or both parties. [signatures follow on next page] IN WITNESS WHEREOF, each of the parties hereto has duly executed this Agreement as of the date first above written. "Company" TRANSWORLD BENEFITS, INC., a Nevada corporation By: __________________________________________ Name: _________________________________________ Title: ________________________________________ "Employee" ___________________________________ RONALD ROBERTSON, an ndividual Schedule 1 Description of Duties During the Term, Employee shall perform the following services: (1) Vice President of the Company (2) Serve as President of the Division of Cemetery and Funeral Industry Sales of the Company, including, without limitation, the following: (a) managing the sales and marketing of such division in accordance with the Sales Territory Business Plan; (b) managing direct mail and other programs for such division in accordance with the Sales Territory Business Plan; and (c) hiring and supervising vice presidents of sales in accordance with the Sales Territory Business Plan. Schedule 2 Sales Territory Business Plan; Schedule of Commissions (See attached pages) EMPLOYMENT AGREEMENT (Keith Romine) This EMPLOYMENT AGREEMENT (this "Agreement") is dated and entered into effective as of June 1, 2001 (the "Effective Date"), by and between TRANSWORLD BENEFITS, INC. (fka Skyway Home, Inc.), a Nevada corporation (the "Company"), and KEITH ROMINE, an individual ("Employee"). R E C I T A L S - - - - - - - - WHEREAS, the Company is a corporation formed and duly qualified in the State of Nevada. WHEREAS, the Company desires to engage Employee to perform certain services, and Employee desires to provide such services to the Company, upon the terms and conditions of this Agreement. A G R E E M E N T - - - - - - - - - NOW, THEREFORE, for and in consideration of the foregoing recitals, the mutual covenants, provisions and terms set forth in this Agreement and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Company and Employee agree as follows: 1. Engagement. The Company hereby employs Employee, and Employee hereby accepts such employment, to provide the "Services" (as defined below) upon the terms and conditions set forth in this Agreement. 2. Services. During the "Term" (as defined below) of this Agreement, Employee shall perform those services and duties as more described in Schedule 1 ---------- attached hereto (collectively, the "Services"). Employee shall have, subject to the direction, supervision and control of the Board of Directors of the Company (the "Board") and the Chief Executive Officer of the Company ("CEO"), and Employee agrees to faithfully perform, such additional duties consistent with such office as may be assigned from time to time by the Board or the CEO. During the Term, Employee shall report to the Board and the CEO. 3. Term. Unless terminated earlier as provided in this Agreement, the Company retains Employee to provide the Services for a term beginning on June 1, 2001 (the "Start Date") and ending on May 31, 2005 (the "Term"). Thereafter, the Term shall be automatically extended for successive periods of one (1) year unless either the Company or Employee gives the other a written notice electing not to extend the Term, given not less than three (3) months prior to the date upon which any such extension would otherwise begin. As used herein, the term "Term" means the original term and any extension thereof. 4. Time and Effort. Employee shall perform the Services under this Agreement in a diligent and competent manner. During the Term, Employee shall perform the Services for the Company on a full-time basis. 5. Compensation. In consideration of Employee's performance of the Services hereunder and other covenants and agreements of Employee hereunder, the Company shall provide to Employee the compensation set forth in this Section 5. 5.1 Base Salary. During the Term, Employee shall receive a base salary ----------- of Seventy-five Thousand Dollars ($75,000) annually, payable in accordance with the Company's payroll procedures. 5.2 Right of First Refusal. In the event that the Company is involved ----------------------- in any future offering of shares in the Company, Employee shall have the right of first refusal to purchase, at the purchase price offered to other investors, such number of shares of the Company under such offering so that Employee's total interest in the Company will not be less than 0.25% of the total issued and outstanding shares of capital stock in the Company (as determined on a fully diluted, as converted basis). 5.3 Stock Option Plan. A stock option plan (the "Plan") is being ------------------- established by the Company. Employee shall be entitled to receive options to purchase shares under the Plan equal to 0.40% of the total issued and outstanding shares of capital stock in the Company as of the establishment of the Plan (as determined on a fully diluted, as converted basis) (the "Optioned Shares"). Subject to the terms set forth herein and in the Plan, Employee shall have the right to purchase 1/3 of the Optioned Shares at each anniversary of the Start Date. Employee shall be entitled to receive such other shares under the Plan as determined by the Company's board of directors in its discretion. Employee hereby acknowledges that Employee's right, title and interest in and to any option granted under this Section 5.3 shall be subject to the terms and conditions set forth in the Plan. 6. Other Benefits. Employee shall be entitled to the following: 6.1 Reimbursement of Expenses. The Company shall reimburse Employee --------------------------- for all business-related expenses and costs actually incurred by Employee in the performance of the Services under this Agreement. The reimbursement of all such costs and expenses shall be subject to reasonable policies and procedures established from time to time by the Company, including, without limitation, as those set forth in the Company's Employee Handbook, as amended. 6.2 Paid Vacation. During the Term, Employee shall be entitled to such ------------- period of paid vacation as available to other employees of the Company as set forth in the Company's Employee Handbook, as amended. Notwithstanding the foregoing, during the first three (3) years of the Term, vacation shall not be taken more than two (2) weeks consecutively. 6.3 Insurance. During the Term, Employee shall receive full medical ---------- coverage generally available to the Company's other executive and managerial employees. In addition, Employee shall be entitled to receive all other benefits of employment generally available to Company's other executive and managerial employees when and as Employee becomes eligible for them, including dental, life insurance and disability plans. 7. Work Products/Confidentiality/Non-Competition. 7.1 Work Products. Employee hereby acknowledges and agrees that any -------------- and all "Work Products" (as defined below) which may have been or are made, developed or conceived of in whole or in part by Employee, or any of Employee's Representatives, in connection with services provided on behalf of the Company or relating to the business of the Company, shall belong solely and exclusively to the Company. Employee shall assign or cause its Representatives to assign to the Company such Employee's or Representative's entire right, title and interest, including all patent, copyright, trade secret, trademark and other proprietary rights, in any and all Work Products. The term "Work Products" means and includes, without limitation, a discovery, a development, a design, an improvement, an invention, a know-how, technical or non-technical data, a formula, a pattern, a compilation, a program, a device, a method, a technique, a drawing, a process, financial data, financial plans, product plans, business plans, software programs (including the object and source code thereto) or a list (whether in written form or otherwise) of actual or potential customers or suppliers, which is not commonly known by or available to the public and which information (i) derives economic value, actual or potential, from not being generally known to and not being readily ascertainable by proper means by other persons who can obtain economic value from its disclosure or use and (ii) is the subject of efforts that are reasonable under the circumstances to maintain its secrecy. 7.2 Business Opportunities. Employee covenants and agrees that any ----------------------- business opportunity which Employee or Employee's "Representatives" (as defined herein) might have during the term of this Agreement which relates to the business of the Company shall first be offered to the Company. If the Company rejects such offer, Employee shall be free to pursue such opportunity. The term "Representative" means and includes, with respect to any person or entity, each shareholder, director, officer, manager, constituent member, constituent partner, trustor, beneficiary, trustee, successor-in-interest, predecessor-in-interest, "Affiliate" (as defined in Section 7.4 hereof), employee, agent, attorney or other representative of such party, expressly excluding however, with respect to each party to this Agreement, the other party to this Agreement. 7.3 Proprietary Information. In the course of Employee's employment by ----------------------- the Company, each of Employee and Employee's Representatives, has had, and will continue to have, access to confidential and proprietary information regarding the Company and its business, including, but not limited to, information regarding the Company's technologies, methods and techniques, product information, specifications, technical drawings and designs, trade secrets, know-how, sources of supply, product and market research data, customer lists, marketing plans, and financial information regarding the Company and its operations. Such information shall be referred to hereinafter as "Proprietary Information" and shall include any and all of the information of the type described and shall also include any and all other confidential and proprietary information relating to the business to be conducted by the Company, whether previously existing, now existing or arising hereafter, whether conceived or developed by others or by Employee alone or with others, and whether or not conceived or developed during regular working hours. Proprietary Information which is released into the public domain during the period of Employee's employment under this Agreement, provided the same is not in the public domain as a consequence of disclosure directly or indirectly by Employee in violation of this Agreement, shall not be subject to the restrictions of this Section. 7.3.1 Fiduciary Obligations. Employee acknowledges that the Company ---------------------- has taken all reasonable steps in protecting the secrecy of the Proprietary Information, that said Proprietary Information is of critical importance to the Company and that a violation of this Section of this Agreement would seriously and irreparably impair and damage the Company's business. Accordingly, Employee agrees that it shall keep (and shall use its commercially reasonable best efforts to cause its Representatives to keep) all Proprietary Information in a fiduciary capacity for the sole benefit of the Company. 7.3.2 Non-Disclosure. Employee shall not, directly or indirectly, use -------------- or disclose (except as Employee's duties may require and except as required by law) any Proprietary Information to any person other than the Company, any employees of the Company who are authorized, at the time of such disclosure, to receive such information, or such other persons to whom Employee has been specifically instructed to make disclosure by the Board of Directors of the Company and in all such cases only to the extent required in the course of Employee's employment by the Company. At the termination of this Agreement, Employee shall deliver to the Company all notes, letters, documents, records, computer files, programs and other media which may contain Proprietary Information which are then in its possession or control and shall not retain or use any copies or summaries thereof. 7.4 Non-Competition. During the Term and for the two year period --------------- following the termination or expiration of the Term (such periods referred to collectively as the "Restriction Period"), neither Employee nor any of Employee's "Affiliates" (as defined below) shall, directly or indirectly, engage in, become employed by, serve as an agent or consultant to, or become a constituent member, partner, principal or stockholder (other than a holder of less than 5% of the outstanding voting shares of any publicly-held company) of any person or entity which engages directly or indirectly in any business or activity competitive with any business or activity engaged in by the Company or any of its subsidiaries. "Affiliates" shall mean and include, with respect to any other person or entity, any person or entity that directly or indirectly through one or more intermediaries controls or is controlled by, or is under common control with such person or entity. 7.5 Non-Solicitation of Employees. During the Restriction Period, ----------------------------- neither Employee nor any of Employee's Affiliates shall, directly or indirectly, for Employee's own account or for the account of any other person or entity with which Employee is or shall become associated in any capacity, (a) solicit for employment, employ or otherwise interfere with the relationship of the Company or any of its Affiliates, any person who at any time during the six months preceding such solicitation, employment or interference is or was employed by or otherwise engaged to perform services for the Company or any of its Affiliates, other than any such solicitation or employment during Employee's employment with the Company on behalf of the Company, or (b) induce any employee of the Company or any of its Affiliates who is a member of management to engage in any activity which Employee is prohibited from engaging in under any of this Section hereof or to terminate Employee's employment with the Company. 7.6 Non-Solicitation of Customers. During the Restriction Period, ----------------------------- neither Employee nor any of Employee's Affiliates shall, directly or indirectly, solicit or otherwise attempt to establish for Employee or any other person, firm or entity any business relationship of a nature that is competitive with the business or relationship of the Company or any of its Affiliates, with any person, firm or corporation which, during the twelve-month period preceding the date Employee's employment with the Company and its Affiliates terminates, was a customer, client or distributor of the Company or any of its Affiliates, other than any such solicitation during Employee's employment with the Company or on behalf of the Company. 8. Termination. 8.1 Termination Upon Death. If Employee dies during the Term, this ------------------------ Agreement shall terminate. Upon such termination, Employee shall be entitled to all accrued and unpaid compensation due under Section 5 above and the other obligations of the Company under this Agreement shall cease as of the date of the termination. 8.2 Termination Upon Permanent Disability. In the event of the ---------------------------------------- "Permanent Disability" (as hereinafter defined) of Employee, the Company may terminate this Agreement pursuant to the terms and conditions set forth in the Company's Employee Handbook, as amended. For the purposes of this Agreement, Employee shall be deemed to have suffered "Permanent Disability" in the event that Employee has become disabled by physical or mental illness or injury to the extent that the Board of Directors of the Company reasonably believes, notwithstanding such reasonable accommodations as the Company may make in response to such disability, that Employee cannot carry out or perform Employee's duties hereunder. In the event that the Company terminates this Agreement following Employee's Permanent Disability, other than accrued and unpaid compensation due to Employee, the compensation obligations of the Company under Section 5 hereof and any other obligations of the Company under this Agreement shall cease as of the date of the termination. 8.3 Termination by Employee. ------------------------- 8.3.1 Employee may terminate this Agreement without cause at any time and for any reason upon sixty (60) days' notice to the Company. 8.3.2 Employee may immediately terminate this Agreement for cause at any time by written notice to the Company. For purposes of this Agreement, the term "cause" for termination by Employee shall be (a) a breach by the Company of any material covenant or obligation hereunder; or (b) the voluntary or involuntary dissolution of the Company. The written notice given hereunder by Employee to the Company shall specify in reasonable detail the cause for termination, and, in the case of the cause described in (a) above, such termination notice shall not be effective until thirty (30) days after the Company's receipt of such notice, during which time the Company shall have the right to respond to Employee's notice and cure the breach or other event giving rise to the termination. In the event that the Company is able to cure, this Agreement shall continue in full force and effect. 8.4 Termination by the Company. ----------------------------- 8.4.1 The Company may terminate this Agreement without cause at any time and for any reason upon sixty (60) days' notice to Employee. 8.4.2 The Company may terminate this Agreement for cause at any time by written notice to Employee. For purposes of this Agreement, the term "cause" for termination by the Company shall be (a) a conviction of or plea of guilty or nolo contendre by Employee to a felony; (b) any action or activity of Employee which could reasonably be expected to have a material adverse effect on the Company, its business, its goodwill or its prospects; (c) the refusal by Employee to perform its material duties and obligations hereunder; or (d) Employee's gross negligence or willful and intentional misconduct in the performance of its duties and obligations. The written notice given hereunder by the Company to Employee shall specify in reasonable detail the cause for termination. In the case of a termination for the cause described in (a) above, such termination shall be effective upon receipt of the written notice. In the case of the causes described in (b) through (d) above, such termination notice shall not be effective until thirty (30) days after Employee's receipt of such notice, during which time Employee shall have the right to respond to the Company's notice and cure the breach or other event giving rise to the termination. In the event that Employee is able to cure, this Agreement shall continue in full force and effect. 8.5 Effect of Termination. Upon any termination of this Agreement, --------------------- the obligations and covenants of the parties hereunder shall be of no further force and effect, except as provided in Section 11.7 below and as set forth in this Section 8.5. Upon any termination of this Agreement by Employee or the Company pursuant to Section 8 hereof, (a) the Company shall pay to Employee all accrued and unpaid compensation as of the date of such termination subject to the terms and conditions set forth in this Agreement; and (b) all other obligations of the Company under this Agreement shall cease as of the date of such termination, including, without limitation, the right of Employee with respect to any unvested shares and any future offering by the Company. 8.6 Effect of Combination or Dissolution. This Agreement shall not --------------------------------------- be terminated by the voluntary or involuntary dissolution of the Company, or by any merger or consolidation in which the Company is not the surviving or resulting entity, or any transfer of all or substantially all of the assets of the Company, or upon any transfer of a majority of the ownership interests of the Company by one or more members in one or more transactions, or upon the issuance of units of membership interests of the Company constituting a majority of the outstanding units immediately following such issuance. Instead, subject to Employee's right to terminate this Agreement pursuant to Section 8.3 above, the provisions of this Agreement shall be binding on and inure to the benefit of the Company's creditors, the surviving business entity or the business entity to which such units or assets shall be transferred. 9. Remedies. 9.1 Injunctive Relief. Employee acknowledges and agrees that (i) the ------------------ covenants and the restrictions contained in Section 7 above are necessary, fundamental, and required for the protection of the Company's business; (ii) such covenants relate to matters which are of a special, unique, and extraordinary character that gives each of such covenants a unique and extraordinary value; and (iii) a breach of any of such covenants will result in irreparable harm and damages to the Company which cannot be adequately compensated by a monetary award. Accordingly, it is expressly agreed that in addition to all other remedies available at law or in equity, the Company shall be entitled to seek injunctive or other equitable relief to restrain or enjoin Employee from breaching any such covenant or to specifically enforce the provisions of Section 7 above. 9.2 No Limitation of Remedies. Notwithstanding the provisions set ---------------------------- forth in Section 9.1 of this Agreement or any other provision contained in this Agreement, the parties hereby agree that no remedy conferred by any of the specific provisions of this Agreement, including without limitation, this Section 9, is intended to be exclusive of any other remedy, and each and every remedy shall be cumulative and shall be in addition to every other remedy given hereunder or now or hereafter existing at law or in equity or by statute or otherwise. 10. Representations and Warranties. Employee hereby represents and warrants to the Company as follows: 10.1 Acquisition Entirely for Own Account. Employee agrees that ---------------------------------------- Employee is acquiring the shares in the Company ("Shares") for investment purposes only, for Employee's own account, and not for sale or with a view to distribution of all or any part of such Shares. Employee has no contract, undertaking, agreement or arrangement with any person or entity to sell, hypothecate, pledge, donate, or otherwise transfer (with or without consideration) the Shares or any portion thereof, and Employee has no present plans or intention to enter any such contract, undertaking agreement or arrangement. 10.2 Accredited Investor. With respect to the acquisition of the -------------------- Shares, Employee qualifies as an "accredited investor" as that term is defined in Rule 501 of Regulation D under the Securities Act of 1933, as amended (the "Securities Act"). 10.3 Investment Experience. Employee acknowledges and understands --------------------- that an investment in the Company is speculative in nature and involves a high degree of risk, and that the Company has no financial or operating history. Employee acknowledges that Employee is able to fend for himself/herself, can bear the economic risk of Employee's investment, and has such knowledge and experience in financial or business matters that Employee is capable of evaluating the merits and risks of the investment in the Shares. 10.4 Restricted Shares. Employee acknowledges that Employee was ------------------ informed that the Shares are not registered under the Securities Act or applicable state laws, and that such Shares are "restricted Shares" and may not be transferred or otherwise disposed of unless subsequently registered under the Securities Act or such laws, or unless an exemption from such registration is available. 11. Miscellaneous. 11.1 Successors and Assigns. This Agreement is in the nature of a ------------------------ personal services contract; and neither party shall assign this Agreement without the prior written consent of the other party. This Agreement shall be binding on and inure to the benefit of the parties hereto and their respective successors, assigns, heirs and legal Representatives. 11.2 Governing Law. This Agreement shall be construed under and in -------------- accordance with, and governed in all respects by, the laws of the State of California (without giving effect to principles of conflicts of law). 11.3 Waiver. The failure of the Company to insist on strict compliance ------ with any of the terms, covenants, or conditions of this Agreement by any other party shall not be deemed a waiver of that term, covenant or condition, nor shall any waiver or relinquishment of any right or power at any one time or times be deemed a waiver or relinquishment of that right or power for all or any other times. 11.4 Notices. Any notice or other communication required or ------- permitted hereunder (each, a "Notice") shall be in writing, and shall be deemed to have been given (a) two (2) days following deposit of such Notice in the United States mail, certified, postage prepaid, return receipt requested, or (b) upon receipt if delivered personally, or delivered by reputable, recognized third party overnight delivery service or courier service or (c) the next business day following receipt, if transmitted by facsimile (provided that such facsimile is followed by the deposit of the original Notice, or a copy thereof, in the United States mail, certified, postage prepaid, return receipt requested, no later than the next business day following transmission of such facsimile), addressed to the parties as follows: To Employee: Mr. Keith Romine ______________________________ ______________________________ ______________________________ To the Company: TransWorld Benefits, Inc. Attn: Charles Seven 18401 Von Karman Irvine, California 92617 Either party may require such Notices to be delivered and given to any address different from or additional to the address set forth above, by delivering Notice thereof to the other party pursuant to this Section. 11.5 Arbitration. Any controversy arising out of or relating to this ------------ Agreement shall be settled by arbitration in Orange County, California in accordance with the Commercial Arbitration Rules of the American Arbitration Association before a single arbitrator agreed to by the parties. If no agreement can be reached regarding the selection of such arbitrator, the American Arbitration Association shall deliver to the parties a list with the names of three qualified arbitrators. Each party shall select a single name. The name not selected by either party or, in the alternative, selected by both parties shall be the arbitrator of such controversy. The decision of the arbitrator shall be binding and non-appealable. The parties hereto consent to the jurisdiction of the Superior Court of the State of California for the County of Orange and of the United States District Court of the Southern District for all purposes in connection with such arbitration, including the entry of judgment on any award. 11.6 Amendments. This Agreement, together with the attached ---------- Schedule(s), constitutes the entire agreement of the parties hereto with respect to the employment and retention of Employee by the Company, and supersedes any and all prior and contemporaneous agreements, whether oral or in writing, between the parties hereto with respect to the subject matter hereof. This Agreement may not be amended, modified, altered or supplemented except by written agreement executed and delivered by the parties hereto. 11.7 Survival of Certain Rights and Obligations. The rights and ----------------------------------------------- obligations of the parties hereto pursuant to Sections 7, 8.5, 9 and 10 of this Agreement shall survive the termination of this Agreement. 11.8 Severability. If any provision of this Agreement is held by a ------------ court of competent jurisdiction to be invalid, void or unenforceable, the remaining provisions shall nevertheless continue in full force without being impaired or invalidated in any way. If any court of competent jurisdiction holds any provision of this Agreement to be invalid, void or unenforceable with respect to any state, region or locality, such provision shall nevertheless continue in full force and effect in all other states, regions and localities to which such provision applies. 11.9 Further Assurances. The parties agree that, at any time and from ------------------- time to time during the Term, they will take any action and execute and deliver any document which the other party reasonably requests in order to carry out the purposes of this Agreement. 11.10 Counterparts. This Agreement may be executed in one or more ------------ counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. 11.11 Attorneys' Fees. If any action at law or in equity is ---------------- necessary to enforce or interpret the terms of this Agreement, the prevailing party shall be entitled to recover any and all reasonable attorneys' fees, expert witness fees, costs and necessary disbursements in addition to any other relief to which such party may be entitled. 11.12 No Third Party Beneficiary. This Agreement is made and entered ---------------------------- into between the parties solely for the benefit of the parties, and not for the benefit of any other third party or entity. No third party or entity shall be deemed or considered a third party beneficiary of any covenant, promise or other provision of this Agreement or have any right to enforce any such covenant, promise or other provision against either or both parties. [signatures follow on next page] IN WITNESS WHEREOF, each of the parties hereto has duly executed this Agreement as of the date first above written. "Company" TRANSWORLD BENEFITS, INC., a Nevada corporation By: __________________________________________ Name: ________________________________________ Title: _______________________________________ "Employee" ______________________________________________ KEITH ROMINE, an individual Schedule 1 Description of Duties During the Term, Employee shall perform the following services: (1) Serve as the Controller of the Company. (2) Serve as the Secretary of the Company, whose duties include, without limitation, the maintenance of all of the Company's books and records. EMPLOYMENT AGREEMENT (Charles C. Seven) This EMPLOYMENT AGREEMENT (this "Agreement") is dated and entered into effective as of ____________, 2000 (the "Effective Date"), by and between TRANSWORLD BENEFITS, INC. (fka Skyway Home, Inc.), a Nevada corporation (the "Company"), and CHARLES C. SEVEN, an individual ("Employee"). R E C I T A L S - - - - - - - - WHEREAS, the Company is a corporation formed and duly qualified in the State of Nevada. WHEREAS, the Company desires to engage Employee to perform certain services, and Employee desires to provide such services to the Company, upon the terms and conditions of this Agreement. A G R E E M E N T - - - - - - - - - NOW, THEREFORE, for and in consideration of the foregoing recitals, the mutual covenants, provisions and terms set forth in this Agreement and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Company and Employee agree as follows: 1. Engagement. The Company hereby employs Employee, and Employee hereby accepts such employment, to provide the "Services" (as defined below) upon the terms and conditions set forth in this Agreement. 2. Services. During the "Term" (as defined below) of this Agreement, Employee shall perform those services and duties as more described in Schedule 1 ---------- attached hereto (collectively, the "Services"). Employee shall have, subject to the direction, supervision and control of the Board of Directors of the Company (the "Board"), and Employee agrees to faithfully perform, such additional duties consistent with such office as may be assigned from time to time by the Board. During the Term, Employee shall report to the Board. 3. Term. Unless terminated earlier as provided in this Agreement, the Company retains Employee to provide the Services for a term beginning on October 1, 2000 (the "Start Date") and ending September 30, 2005 (the "Term"). Thereafter, the Term shall be automatically extended for successive periods of one (1) year unless either the Company or Employee gives the other a written notice electing not to extend the Term, given not less than three (3) months prior to the date upon which any such extension would otherwise begin. As used herein, the term "Term" means the original term and any extension thereof. 4. Time and Effort. Employee shall perform the Services under this Agreement in a diligent and competent manner. During the Term, Employee shall perform the Services for the Company on a full-time basis. 5. Compensation. In consideration of Employee's performance of the Services hereunder and other covenants and agreements of Employee hereunder, the Company shall provide to Employee the compensation set forth in this Section 5. 5.1 Base Salary. During the Term, Employee shall receive a base ------------ salary of One Hundred Twenty Thousand Dollars ($120,000) annually, payable in accordance with the Company's payroll procedures. 5.2 Bonus Compensation. During the Term, the Company shall pay to ------------------- Employee an annual bonus compensation equal to one percent (1%) of the Company's total gross sales for such fiscal period, pursuant to the terms of Schedule 2, ---------- attached hereto and incorporated herein by this reference. 5.3 Right of First Refusal. In the event that the Company is ------------------------- involved in any future offering of shares in the Company, Employee shall have the right of first refusal to purchase, at the purchase price offered to other investors, such number of shares of the Company under such offering so that Employee's total interest in the Company will not be less than forty percent (40%) of the total issued and outstanding shares of capital stock in the Company (as determined on a fully diluted, as converted basis). 5.4 Stock Option Plan. A stock option plan (the "Plan") is being ------------------ established by the Company. Employee shall be entitled to receive options to purchase shares under the Plan equal to a minimum of forty percent (40%) of the total issued and outstanding shares of capital stock in the Company as of the establishment of the Plan (as determined on a fully diluted, as converted basis) (the "Optioned Shares"). Employee shall be entitled to receive such other shares under the Plan as determined by the Company's board of directors in its discretion. Employee hereby acknowledges that Employee's right, title and interest in and to any option granted under this Section 5.4 shall be subject to the terms and conditions set forth in the Plan. 6. Other Benefits. Employee shall be entitled to the following: 6.1 Reimbursement of Expenses. The Company shall reimburse --------------------------- Employee for all business-related expenses and costs actually incurred by Employee in the performance of the Services under this Agreement. Reimbursement of all such costs and expenses shall be subject to reasonable policies and procedures established from time to time by the Company, including, without limitation, as those set forth in the Company's Employee Handbook, as amended. 6.2 Paid Vacation. During the Term, Employee shall be entitled to ------------- such period of paid vacation as available to other employees of the Company as set forth in the Company's Employee Handbook, as amended. Employee shall be entitled to no less than three (3) weeks of paid vacation annually. Notwithstanding the foregoing, during the first three (3) years of the Term, vacation shall not be taken more than two (2) weeks consecutively. 6.3 Car Allowance. During the Term, the Company will provide -------------- Employee with a car allowance of Seven Hundred Dollars ($700) per month. 6.4 Insurance. During the Term, Employee shall receive full ---------- medical coverage generally available to the Company's other executive and managerial employees. In addition, Employee shall be entitled to receive all other benefits of employment generally available to Company's other executive and managerial employees when and as Employee becomes eligible for them, including dental, life insurance and disability plans. 7. Work Products/Confidentiality/Non-Competition. 7.1 Work Products. Employee hereby acknowledges and agrees that any -------------- and all "Work Products" (as defined below) which may have been or are made, developed or conceived of in whole or in part by Employee, or any of Employee's Representatives, in connection with services provided on behalf of the Company or relating to the business of the Company, shall belong solely and exclusively to the Company. Employee shall assign or cause its Representatives to assign to the Company such Employee's or Representative's entire right, title and interest, including all patent, copyright, trade secret, trademark and other proprietary rights, in any and all Work Products. The term "Work Products" means and includes, without limitation, a discovery, a development, a design, an improvement, an invention, a know-how, technical or non-technical data, a formula, a pattern, a compilation, a program, a device, a method, a technique, a drawing, a process, financial data, financial plans, product plans, business plans, software programs (including the object and source code thereto) or a list (whether in written form or otherwise) of actual or potential customers or suppliers, which is not commonly known by or available to the public and which information (i) derives economic value, actual or potential, from not being generally known to and not being readily ascertainable by proper means by other persons who can obtain economic value from its disclosure or use and (ii) is the subject of efforts that are reasonable under the circumstances to maintain its secrecy. 7.2 Business Opportunities. Employee covenants and agrees that any ----------------------- business opportunity which Employee or Employee's "Representatives" (as defined herein) might have during the term of this Agreement which relates to the business of the Company shall first be offered to the Company. If the Company rejects such offer, Employee shall be free to pursue such opportunity. The term "Representative" means and includes, with respect to any person or entity, each shareholder, director, officer, manager, constituent member, constituent partner, trustor, beneficiary, trustee, successor-in-interest, predecessor-in-interest, "Affiliate" (as defined in Section 7.4 hereof), employee, agent, attorney or other representative of such party, expressly excluding however, with respect to each party to this Agreement, the other party to this Agreement. 7.3 Proprietary Information. In the course of Employee's employment by ----------------------- the Company, each of Employee and Employee's Representatives, has had, and will continue to have, access to confidential and proprietary information regarding the Company and its business, including, but not limited to, information regarding the Company's technologies, methods and techniques, product information, specifications, technical drawings and designs, trade secrets, know-how, sources of supply, product and market research data, customer lists, marketing plans, and financial information regarding the Company and its operations. Such information shall be referred to hereinafter as "Proprietary Information" and shall include any and all of the information of the type described and shall also include any and all other confidential and proprietary information relating to the business to be conducted by the Company, whether previously existing, now existing or arising hereafter, whether conceived or developed by others or by Employee alone or with others, and whether or not conceived or developed during regular working hours. Proprietary Information which is released into the public domain during the period of Employee's employment under this Agreement, provided the same is not in the public domain as a consequence of disclosure directly or indirectly by Employee in violation of this Agreement, shall not be subject to the restrictions of this Section. 7.3.1 Fiduciary Obligations. Employee acknowledges that the Company ---------------------- has taken all reasonable steps in protecting the secrecy of the Proprietary Information, that said Proprietary Information is of critical importance to the Company and that a violation of this Section of this Agreement would seriously and irreparably impair and damage the Company's business. Accordingly, Employee agrees that it shall keep (and shall use its commercially reasonable best efforts to cause its Representatives to keep) all Proprietary Information in a fiduciary capacity for the sole benefit of the Company. 7.3.2 Non-Disclosure. Employee shall not, directly or indirectly, use -------------- or disclose (except as Employee's duties may require and except as required by law) any Proprietary Information to any person other than the Company, any employees of the Company who are authorized, at the time of such disclosure, to receive such information, or such other persons to whom Employee has been specifically instructed to make disclosure by the Board of Directors of the Company and in all such cases only to the extent required in the course of Employee's employment by the Company. At the termination of this Agreement, Employee shall deliver to the Company all notes, letters, documents, records, computer files, programs and other media which may contain Proprietary Information which are then in its possession or control and shall not retain or use any copies or summaries thereof. 7.4 Non-Competition. During the Term and for the two year period --------------- following the termination or expiration of the Term (such periods referred to collectively as the "Restriction Period"), neither Employee nor any of Employee's "Affiliates" (as defined below) shall, directly or indirectly, engage in, become employed by, serve as an agent or consultant to, or become a constituent member, partner, principal or stockholder (other than a holder of less than 5% of the outstanding voting shares of any publicly-held company) of any person or entity which engages directly or indirectly in any business or activity competitive with any business or activity engaged in by the Company or any of its subsidiaries. "Affiliates" shall mean and include, with respect to any other person or entity, any person or entity that directly or indirectly through one or more intermediaries controls or is controlled by, or is under common control with such person or entity. 7.5 Non-Solicitation of Employees. During the Restriction Period, ------------------------------- neither Employee nor any of Employee's Affiliates shall, directly or indirectly, for Employee's own account or for the account of any other person or entity with which Employee is or shall become associated in any capacity, (a) solicit for employment, employ or otherwise interfere with the relationship of the Company or any of its Affiliates, any person who at any time during the six months preceding such solicitation, employment or interference is or was employed by or otherwise engaged to perform services for the Company or any of its Affiliates, other than any such solicitation or employment during Employee's employment with the Company on behalf of the Company, or (b) induce any employee of the Company or any of its Affiliates who is a member of management to engage in any activity which Employee is prohibited from engaging in under any of this Section hereof or to terminate Employee's employment with the Company. 7.6 Non-Solicitation of Customers. During the Restriction Period, ------------------------------- neither Employee nor any of Employee's Affiliates shall, directly or indirectly, solicit or otherwise attempt to establish for Employee or any other person, firm or entity any business relationship of a nature that is competitive with the business or relationship of the Company or any of its Affiliates, with any person, firm or corporation which, during the twelve-month period preceding the date Employee's employment with the Company and its Affiliates terminates, was a customer, client or distributor of the Company or any of its Affiliates, other than any such solicitation during Employee's employment with the Company or on behalf of the Company. 8. Termination. 8.1 Termination Upon Death. If Employee dies during the Term, this ------------------------ Agreement shall terminate. Upon such termination, Employee shall be entitled to all accrued and unpaid compensation due under Section 5 above and the other obligations of the Company under this Agreement shall cease as of the date of the termination. 8.2 Termination Upon Permanent Disability. In the event of the ---------------------------------------- "Permanent Disability" (as hereinafter defined) of Employee, the Company may terminate this Agreement pursuant to the terms and conditions set forth in the Company's Employee Handbook, as amended. Notwithstanding the foregoing or any other provision contained herein or in the Employee Handbook to the contrary, in the event of Permanent Disability, Employee shall receive no less than fifty percent (50%) of such Employee's base salary immediately prior to Permanent Disability for a period of no less than three (3) years following such Permanent Disability. For the purposes of this Agreement, Employee shall be deemed to have suffered "Permanent Disability" in the event that Employee has become disabled by physical or mental illness or injury to the extent that the Board of Directors of the Company reasonably believes, notwithstanding such reasonable accommodations as the Company may make in response to such disability, that Employee cannot carry out or perform Employee's duties hereunder. In the event that the Company terminates this Agreement following Employee's Permanent Disability, other than accrued and unpaid compensation due to Employee, the compensation obligations of the Company under Section 5 hereof and any other obligations of the Company under this Agreement shall cease as of the date of the termination. 8.3 Termination by Employee. ------------------------- 8.3.1 Employee may terminate this Agreement without cause at any time and for any reason upon sixty (60) days' notice to the Company. 8.3.2 Employee may immediately terminate this Agreement for cause at any time by written notice to the Company. For purposes of this Agreement, the term "cause" for termination by Employee shall be (a) a breach by the Company of any material covenant or obligation hereunder; or (b) the voluntary or involuntary dissolution of the Company. The written notice given hereunder by Employee to the Company shall specify in reasonable detail the cause for termination, and, in the case of the cause described in (a) above, such termination notice shall not be effective until thirty (30) days after the Company's receipt of such notice, during which time the Company shall have the right to respond to Employee's notice and cure the breach or other event giving rise to the termination. In the event that the Company is able to cure, this Agreement shall continue in full force and effect. 8.4 Termination by the Company. The Company may terminate this ----------------------------- Agreement for cause at any time by written notice to Employee. For purposes of this Agreement, the term "cause" for termination by the Company shall be (a) a conviction of or plea of guilty or nolo contendre by Employee to a felony; (b) any action or activity of Employee which could reasonably be expected to have a material adverse effect on the Company, its business, its goodwill or its prospects; (c) the refusal by Employee to perform its material duties and obligations hereunder; or (d) Employee's gross negligence or willful and intentional misconduct in the performance of its duties and obligations. The written notice given hereunder by the Company to Employee shall specify in reasonable detail the cause for termination. In the case of a termination for the cause described in (a) above, such termination shall be effective upon receipt of the written notice. In the case of the causes described in (b) through (d) above, such termination notice shall not be effective until thirty (30) days after Employee's receipt of such notice, during which time Employee shall have the right to respond to the Company's notice and cure the breach or other event giving rise to the termination. In the event that Employee is able to cure, this Agreement shall continue in full force and effect. 8.5 Effect of Termination. Upon any termination of this ----------------------- Agreement, the obligations and covenants of the parties hereunder shall be of no further force and effect, except as provided in Section 11.7 below and as set forth in this Section 8.5. Upon any termination of this Agreement by Employee or the Company pursuant to Section 8 hereof, (a) the Company shall pay to Employee all accrued and unpaid compensation as of the date of such termination subject to the terms and conditions set forth in this Agreement; and (b) all other obligations of the Company under this Agreement shall cease as of the date of such termination, including, without limitation, the right of Employee with respect to any unvested Shares and any future offering by the Company. 8.6 Effect of Combination or Dissolution. This Agreement shall --------------------------------------- not be terminated by the voluntary or involuntary dissolution of the Company, or by any merger or consolidation in which the Company is not the surviving or resulting entity, or any transfer of all or substantially all of the assets of the Company, or upon any transfer of a majority of the ownership interests of the Company by one or more members in one or more transactions, or upon the issuance of units of membership interests of the Company constituting a majority of the outstanding units immediately following such issuance. Instead, subject to Employee's right to terminate this Agreement pursuant to Section 8.3 above, the provisions of this Agreement shall be binding on and inure to the benefit of the Company's creditors, the surviving business entity or the business entity to which such units or assets shall be transferred. 9. Remedies. 9.1 Injunctive Relief. Employee acknowledges and agrees that (i) the ------------------ covenants and the restrictions contained in Section 7 above are necessary, fundamental, and required for the protection of the Company's business; (ii) such covenants relate to matters which are of a special, unique, and extraordinary character that gives each of such covenants a unique and extraordinary value; and (iii) a breach of any of such covenants will result in irreparable harm and damages to the Company which cannot be adequately compensated by a monetary award. Accordingly, it is expressly agreed that in addition to all other remedies available at law or in equity, the Company shall be entitled to seek injunctive or other equitable relief to restrain or enjoin Employee from breaching any such covenant or to specifically enforce the provisions of Section 7 above. 9.2 No Limitation of Remedies. Notwithstanding the provisions set ---------------------------- forth in Section 9.1 of this Agreement or any other provision contained in this Agreement, the parties hereby agree that no remedy conferred by any of the specific provisions of this Agreement, including without limitation, this Section 9, is intended to be exclusive of any other remedy, and each and every remedy shall be cumulative and shall be in addition to every other remedy given hereunder or now or hereafter existing at law or in equity or by statute or otherwise. 10. Representations and Warranties. Employee hereby represents and warrants to the Company as follows: 10.1 Acquisition Entirely for Own Account. Employee agrees that ---------------------------------------- Employee is acquiring the shares in the Company ("Shares") for investment purposes only, for Employee's own account, and not for sale or with a view to distribution of all or any part of such Shares. Employee has no contract, undertaking, agreement or arrangement with any person or entity to sell, hypothecate, pledge, donate, or otherwise transfer (with or without consideration) the Shares or any portion thereof, and Employee has no present plans or intention to enter any such contract, undertaking agreement or arrangement. 10.2 Accredited Investor. With respect to the acquisition of the -------------------- Shares, Employee qualifies as an "accredited investor" as that term is defined in Rule 501 of Regulation D under the Securities Act of 1933, as amended (the "Securities Act"). 10.3 Investment Experience. Employee acknowledges and understands that --------------------- an investment in the Company is speculative in nature and involves a high degree of risk, and that the Company has no financial or operating history. Employee acknowledges that Employee is able to fend for himself/herself, can bear the economic risk of Employee's investment, and has such knowledge and experience in financial or business matters that Employee is capable of evaluating the merits and risks of the investment in the Shares. 10.4 Restricted Shares. Employee acknowledges that Employee was ------------------ informed that the Shares are not registered under the Securities Act or applicable state laws, and that such Shares are "restricted Shares" and may not be transferred or otherwise disposed of unless subsequently registered under the Securities Act or such laws, or unless an exemption from such registration is available. 11. Miscellaneous. 11.1 Successors and Assigns. This Agreement is in the nature of a ------------------------ personal services contract; and neither party shall assign this Agreement without the prior written consent of the other party. This Agreement shall be binding on and inure to the benefit of the parties hereto and their respective successors, assigns, heirs and legal Representatives. 11.2 Governing Law. This Agreement shall be construed under and in -------------- accordance with, and governed in all respects by, the laws of the State of California (without giving effect to principles of conflicts of law). 11.3 Waiver. The failure of the Company to insist on strict compliance ------ with any of the terms, covenants, or conditions of this Agreement by any other party shall not be deemed a waiver of that term, covenant or condition, nor shall any waiver or relinquishment of any right or power at any one time or times be deemed a waiver or relinquishment of that right or power for all or any other times. 11.4 Notices. Any notice or other communication required or ------- permitted hereunder (each, a "Notice") shall be in writing, and shall be deemed to have been given (a) two (2) days following deposit of such Notice in the United States mail, certified, postage prepaid, return receipt requested, or (b) upon receipt if delivered personally, or delivered by reputable, recognized third party overnight delivery service or courier service or (c) the next business day following receipt, if transmitted by facsimile (provided that such facsimile is followed by the deposit of the original Notice, or a copy thereof, in the United States mail, certified, postage prepaid, return receipt requested, no later than the next business day following transmission of such facsimile), addressed to the parties as follows: To Employee: Mr. Charles C. Seven ____________________________ ____________________________ ____________________________ To the Company: TransWorld Benefits, Inc. Attn: ____________________ 18401 Von Karman Irvine, California 92617 Either party may require such Notices to be delivered and given to any address different from or additional to the address set forth above, by delivering Notice thereof to the other party pursuant to this Section. 11.5 Arbitration. Any controversy arising out of or relating to this ------------ Agreement shall be settled by arbitration in Orange County, California in accordance with the Commercial Arbitration Rules of the American Arbitration Association before a single arbitrator agreed to by the parties. If no agreement can be reached regarding the selection of such arbitrator, the American Arbitration Association shall deliver to the parties a list with the names of three qualified arbitrators. Each party shall select a single name. The name not selected by either party or, in the alternative, selected by both parties shall be the arbitrator of such controversy. The decision of the arbitrator shall be binding and non-appealable. The parties hereto consent to the jurisdiction of the Superior Court of the State of California for the County of Orange and of the United States District Court of the Southern District for all purposes in connection with such arbitration, including the entry of judgment on any award. 11.6 Amendments. This Agreement, together with the attached ---------- Schedule(s), constitutes the entire agreement of the parties hereto with respect to the employment and retention of Employee by the Company, and supersedes any and all prior and contemporaneous agreements, whether oral or in writing, between the parties hereto with respect to the subject matter hereof. This Agreement may not be amended, modified, altered or supplemented except by written agreement executed and delivered by the parties hereto. 11.7 Survival of Certain Rights and Obligations. The rights and ------------------------------------------ obligations of the parties hereto pursuant to Sections 7, 8.5, 9 and 10 of this Agreement shall survive the termination of this Agreement. 11.8 Severability. If any provision of this Agreement is held by a ------------ court of competent jurisdiction to be invalid, void or unenforceable, the remaining provisions shall nevertheless continue in full force without being impaired or invalidated in any way. If any court of competent jurisdiction holds any provision of this Agreement to be invalid, void or unenforceable with respect to any state, region or locality, such provision shall nevertheless continue in full force and effect in all other states, regions and localities to which such provision applies. 11.9 Further Assurances. The parties agree that, at any time and from ------------------- time to time during the Term, they will take any action and execute and deliver any document which the other party reasonably requests in order to carry out the purposes of this Agreement. 11.10 Counterparts. This Agreement may be executed in one or more ------------ counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. 11.11 Attorneys' Fees. If any action at law or in equity is necessary ---------------- to enforce or interpret the terms of this Agreement, the prevailing party shall be entitled to recover any and all reasonable attorneys' fees, expert witness fees, costs and necessary disbursements in addition to any other relief to which such party may be entitled. 11.12 No Third Party Beneficiary. This Agreement is made and entered ---------------------------- into between the parties solely for the benefit of the parties, and not for the benefit of any other third party or entity. No third party or entity shall be deemed or considered a third party beneficiary of any covenant, promise or other provision of this Agreement or have any right to enforce any such covenant, promise or other provision against either or both parties. [signatures follow on next page] IN WITNESS WHEREOF, each of the parties hereto has duly executed this Agreement as of the date first above written. "Company" TRANSWORLD BENEFITS, INC., a Nevada corporation By: ____________________________________________ Name: __________________________________________ Title: _________________________________________ "Employee" ___________________________________________ CHARLES C. SEVEN, an individual Schedule 1 Description of Duties During the Term, Employee shall perform the following services: (1) Serve as the Chief Executive Officer of the Company. (2) Serve as Chairman of the Company's Executive Committee. (3) Serve as Chairman of the Company's Board of Directors. (4) Perform such other duties as consistent with the office of the Chief Executive Officer of a comparably-sized company engaged in activities comparable to the business of the Company. Schedule 2 Business Plan (See attached pages) SCHEDULE "D" ------------- to that Share Purchase Agreement dated as of October 4, 2002 REAL PROPERTY & LEASES OF THE COMPANY Sublease dated May 16, 2002, by and between DHR International, Inc. and Transworld Benefits, Inc., as amended by that certain Amendment No. 1 to Office Building Lease and Consent of Landlord to Sublease dated September 2002. SCHEDULE "E" ------------- to that Share Purchase Agreement dated as of October 4, 2002 ENCUMBRANCES ON THE COMPANY'S ASSETS None. SCHEDULE "F" ------------- to that Share Purchase Agreement dated as of October 4, 2002 COMPANY LITIGATION None. SCHEDULE "G" ------------- to that Share Purchase Agreement dated as of October 4, 2002 PURCHASER LITIGATION SCHEDULE "H" ------------- to that Share Purchase Agreement dated as of October 4, 2002 REGISTERED TRADEMARKS, TRADE NAMES & PATENTS OF THE COMPANY None. EX-10 4 exhibitfivetwo.txt AGREEMENT --------- THIS AGREEMENT dated for reference the 24th day of September, 2002. AMONG: FARLINE VENTURE CORPORATION, a body corporate ---------------------------- with offices at Suite 2100 - 1066 West Hastings Street, Vancouver, British Columbia (hereinafter the "Vendor") OF THE FIRST PART AND: WILLIAM INY, of 5709 Hudson Street ------------ Vancouver, BC V6M 2Z2 (hereinafter the "Vendor's Principal") OF THE SECOND PART AND: CHARLES SEVEN, RON ROBERTSON, KEITH ROMINE, ------------- ------------- ------------- THOMAS BLAKE, PIRJO JARVIS, and ------------- ------------- FLAX-FLEX FABRICATORS, LTD., of --------------------------- 20516 Claremont Avenue Riverside, CA 92507 (hereinafter the "Purchasers") OF THE THIRD PART WHEREAS the Vendor is the holder of 5,721,435 common shares (the "Vendor's Share Position") of Thinka Weight Loss Corporation (the "Company"). AND WHEREAS the Purchasers are directors, officers, key employees, consultants or shareholders of Transworld Benefits, Inc. ("Transworld"). AND WHEREAS the Purchasers wish to acquire 5,300,000 shares of the Vendor's Share Position. 2 NOW THEREFORE THIS AGREEMENT WITNESSES THAT in consideration of the foregoing and of the mutual covenants and conditions hereinafter contained, the parties hereto have agreed and do hereby agree as follows: 1. For the consideration set out in paragraph (2) hereof the Vendor agrees to sell and the Purchasers agree to purchase, a total of 5,300,000 shares (the "Purchaser Shares") being a portion of the Vendor's Share Position. 2. The aggregate purchase price payable at closing will be $150,000 US (the "Purchase Price") being approximately $0.0283 per share. 3. The Purchaser's Shares will be transferred at closing to the Purchasers as follows: Purchaser No. of Shares Portion of Purchase Price - -------------------------------------------------------------------------- Flax-Flex Fabricators, Ltd. 3,383,000 $ 109,899 Charles Seven 1,000,000 28,300 Ron Robertson 167,000 4,726 Thomas Blake 100,000 2,830 Pirjo Jarvis 100,000 2,830 Keith Romine 50,000 1,415 --------- ------------ 5,300,000 $ 150,000 4. Each Purchaser represents to the Vendor as follows: a. The Purchaser is acquiring the Shares for his own account for investment purposes, with no present intention of dividing interest with others or reselling or otherwise disposing of any or all of the Purchaser Shares; b. The Purchaser does not intend any sale of the Purchaser Shares either currently or after the passage of a fixed or determinable period of time or upon the occurrence or nonoccurrence of any predetermined event or circumstance; c. The Purchaser has no present or contemplated agreement providing for the sale or other disposition of the Purchaser Shares; d. The Purchaser is not aware of any circumstance presently in existence which is likely in the future to prompt a sale or other disposition of the Purchaser Shares; and 3 e. The Purchaser possesses the financial and business experience to make an informed decision to acquire the Shares and has had access to all information relating to the Company and its business operations which would be necessary to make an informed decision to purchase the Purchaser Shares. f. The Purchaser acknowledges and agrees that the Shares are restricted shares, as contemplated under the United States Securities Act of 1933 ---------------------- (the "1933 Act") which have been issued to the Vendor pursuant to Section 4(2) of the 1933 Act without registration and that all share certificates representing the Shares will be endorsed with the following legend: "THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE "ACT"), AND HAVE BEEN ISSUED IN RELIANCE UPON EXEMPTIONS FROM THE REGISTRATION REQUIREMENTS OF THE ACT. SUCH SECURITIES MAY NOT BE REOFFERED FOR SALE OR RESOLD OR OTHERWISE TRANSFERRED UNLESS THEY ARE REGISTERED UNDER THE APPLICABLE PROVISIONS OF THE ACT OR ARE EXEMPT FROM SUCH REGISTRATION." 5. The Vendor and the Vendor's Principal represent as follows: a. The Vendor's Share Position is owned by the Vendor as the beneficial owner thereof with a good and marketable title thereto free and clear of all mortgages, liens, charges, security interests, adverse claims, charges, encumbrances, and demands whatsoever. b. No person, firm or corporation has any agreement or option or any right or privilege (whether by law, pre-emptive or contractual) capable of becoming an agreement or option for the purchase from the Vendor of any of the Vendor's Share Position. c. The Vendor and the Vendor's Principal have no claims against the Company and the Company is not indebted to the Vendor or the Vendor's Principal. 6. The Vendor agrees that with respect to the balance of the Vendor's Share Position, the Vendor will not sell any shares except in accordance with Rule 144 promulgated under the 1933 Act and in any event, will not sell more than 60,000 shares in any 30 day period. 4 7. To the extent that the Vendor complies with the volume restrictions of paragraph 6 hereof, the Purchasers agree to fully cooperate with the Vendor with respect to the Vendor's disposition of the balance of the Vendor's Share Position and to use their best efforts to assist the Vendor with respect to the removal of any legend with respect to the sale of the balance of the Vendor's Share Position. 8. Closing shall take place at the offices of Cane O'Neill Taylor LLC in Las Vegas, Nevada, on the 90th day following the date of this Agreement or at such earlier date as the Purchasers may on three days' notice, specify. 9. It shall be a condition of closing of this Agreement that concurrent or prior to closing, the Company shall have acquired all the issued and outstanding shares of Transworld in exchange for the issuance of 4,500,000 common shares of the Company. 10. At Closing, the Vendor shall deliver to the Purchasers certificates representing the Shares, duly endorsed in blank for transfer with the Vendor's signature properly guaranteed or with a duly executed and guaranteed stock power of attorney and directors resolution. 11. At Closing, the Purchasers shall deliver to the Vendor attorney's trust checks for the Purchase Price. 12. This agreement and the application or interpretation of it shall be governed exclusively by the laws of the State of Nevada and each party irrevocably attorns to the jurisdiction of the courts of Nevada. 13. Time shall be of the essence of this agreement. 14. Each provision of this agreement shall be severable. If any provision of it is illegal or invalid, the illegality or invalidity shall not affect the validity of the remainder of this agreement. 15. This agreement is to be read with all changes in gender or number as required by the context. 16. The parties hereto agree to execute and deliver such further and other documents and perform and cause to be performed such further and other acts and things as may be necessary or desirable in order to give full effect to this agreement and every part thereof. 5 17. Any notice to be given under this Agreement shall be duly and properly given if made in writing and by delivering or telecopying the same to the addressee at the address as set out on page one of this Agreement. Any notice given as aforesaid shall be deemed to have been given or made on, if delivered, the date on which it was delivered or, if telecopied, on the fifth business day after it was telecopied. Any party hereto may change its address for notice from time to time by notice given to the other parties hereto in accordance with the foregoing. 18. This agreement constitutes the entire agreement between the Parties and supersedes all prior and contemporaneous agreements, understandings and discussions, whether oral or written, and there are no warranties or representations between the parties except as expressly provided in this agreement. 19. This agreement shall enure to the benefit of and be binding on the parties, their respective heirs, executors, administrators and assigns. 20. This agreement may be executed in counterparts which together shall form one and the same instrument. IN WITNESS WHEREOF this agreement has been executed by the parties as of the day and year first above written. FARLINE VENTURE CORPORATION by its authorized signatory: ___/S/____________________________ Signature of Authorized Signatory __________________________________ Name and Title of Authorized Signatory SIGNED, SEALED AND DELIVERED BY WILLIAM INY in the presence of: _____________________________ __/S/WILLIAM INY_________ Name of Witness WILLIAM INY _____________________________ Address of Witness _____/S/_____________________ 6 SIGNED, SEALED AND DELIVERED BY CHARLES SEVEN in the presence of: _____________________________ __/S/CHARLES SEVEN_______ Name of Witness CHARLES SEVEN _____________________________ Address of Witness ______/S/____________________ SIGNED, SEALED AND DELIVERED BY RON ROBERTSON in the presence of: _____________________________ __/S/RON ROBERTSON_______ Name of Witness RON ROBERTSON _____________________________ Address of Witness ____/S/______________________ SIGNED, SEALED AND DELIVERED BY KEITH ROMINE in the presence of: _____________________________ __/S/KEITH ROMINE________ Name of Witness KEITH ROMINE _____________________________ Address of Witness ____/S/______________________ 7 SIGNED, SEALED AND DELIVERED BY THOMAS BLAKE in the presence of: _____________________________ __/S/THOMAS BLAKE________ Name of Witness THOMAS BLAKE _____________________________ Address of Witness SIGNED, SEALED AND DELIVERED BY PIRJO JARVIS in the presence of: _____________________________ __/S/PIRJO JARVIS________ Name of Witness PIRJO JARVIS _____________________________ Address of Witness ______/S/____________________ _____________________________ FLAX-FLEX FABRICATORS, LTD. by its authorized signatory: _____/S/__________________________ Signature of Authorized Signatory __________________________________ Name and Title of Authorized Signatory -----END PRIVACY-ENHANCED MESSAGE-----