99.1 Press Release
Expansion of Operations and Corporate Reorganization announced by Visual Edge
Systems, Inc.
Boca Raton, Florida. July 13, 2000 -- Visual Edge Systems Inc. (OTC BB:
EDGE), producers of the Greg Norman One-on-One interactive golf lessons,
announced today the proposed expansion of its operations and reorganization and
restructuring of the company.
Expansion of Operations
Edge intends to expand significantly its operations to include:
o Operating, financing and developing technology-oriented companies
internationally through subsidiaries and affiliated companies;
o Building minority strategic positions in companies that provide services
and/or products that complement Edge's strategy and majority owned
businesses; and
o Promoting and integrating cross business relationships among Edge's network
of companies while developing strategic partnerships with successful global
technology companies, scientific organizations and investment and
consulting partners.
Edge intends to focus on industries where technology can increase profitability
and create new business opportunities. Edge has identified specific
opportunities in industries including biotechnology, communications and
information technology.
Corporate Changes
Edge intends, subject to stockholder approval, to change its name from
Visual Edge Systems, Inc. to Edge Technology Group, Inc. to better describe the
expanded scope of its operations. Additionally, subject to stockholder approval,
Edge intends to transfer its current lines of CD-ROM products with Internet
delivery into a wholly-owned subsidiary corporation which will retain the name
Visual Edge Systems, Inc.
Corporate Reorganization
In connection with the expansion of Edge's operations, the holders of
Edge's convertible notes and Series A-2 Convertible Preferred Stock have entered
into an Agreement and Fourth Amendment of Bridge Securities Purchase Agreement
with Edge. Under the Fourth Amendment, the holders of the convertible securities
have agreed that, subject to the satisfaction of certain conditions, they will
convert all their convertible securities based on a formula of four shares of
common stock for each $1.00 in value of principle and interest outstanding under
the convertible notes and for each $1.00 in value of liquidation amount of the
Series A-2 Preferred Stock and of unpaid dividends. The number of shares of
common stock issuable upon a conversion using this formula is
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approximately 26,800,000 before taking into account the reverse stock split
discussed below. This conversion will eliminate a substantial portion of Edge's
debt and enhance future opportunities to raise new capital.
As part of the reorganization, Edge intends to raise new capital and
believes the conversion will assist it in these efforts. Edge must complete its
contemplated capital raise of at least $3.0 million in net proceeds as a
condition to the conversion. As a further condition to the reorganization
occurring, Edge must cause a reverse stock split which converts four shares of
Edge's common stock into one share of Edge's common stock. The reorganization is
expected to close in early August 2000.
At the closing of the reorganization, Mr. Pierre Koshakji is expected to
become president and chief executive officer of Edge and Mr. Johan Schotte is
expected to become chairman of the board, Messrs. Koshakji and Schotte have
consented to serving in these positions, subject to Edge fulfilling certain
conditions. Mr. Koshakji is president of Entertainment Education Enterprises
Corporation, a Dallas-based investment and management company, and is an
electrical engineer and management executive by training and experience. Mr.
Schotte is founder and chairman of Media Trust S.A., a private Luxembourg-based
multinational investment and management company and is currently serving as
chief executive officer and chairman of Odyssey Pictures Corporation, a
portfolio company of Media Trust S.A.
Having stabilized Edge's business, Mr. Ronald Seale, the chairman of the
board, president and chief executive officer of Edge, is stepping down from his
positions as part of the reorganization, Mr. Seale will continue to act as a
consultant to the company with primary responsibility for business development
for Edge's current sports technology operations.
We cannot assure our investors that the transactions discussed in this
press release will close, that such transactions will prove successful or that
unforeseen developments will not occur, any of which could have a material
adverse effect on our business, financial condition and results of operations.
This statement contains references to future events and results, including
anticipated transactions involving Visual Edge Systems Inc. These statements are
forward-looking statements regarding future events and the future financial
performance of Visual Edge and no assurances can be made regarding their
eventual occurrence. Actual occurrences and results may differ substantially and
materially from those projected as a result of risks and uncertainties detailed
in Visual Edge's periodic reports and registration statements filed with the
Securities and Exchange Commission (viewable at www.sec.gov), including its Form
10-K for the year ended December 31, 1999, and Form 8-K filed in connection with
the transactions contemplated in this statement.
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Corporate changes
Edge intends, subject to stockholder approval, to change its name from
Visual Edge Systems, Inc. to Edge Technology Group, Inc. to better describe the
expanded scope of its operations. Additionally, subject to stockholder approval,
Edge intends to transfer its side-by-side video comparison operations into a
wholly-owned subsidiary corporation that will retain the name Visual Edge
Systems, Inc.
Corporate reorganization
In connection with the expansion of Edge's operations, the holders of the
Edge's convertible securities, consisting of Edge's convertible notes and Series
A-2 Convertible Preferred Stock, have entered into an Agreement and Fourth
Amendment of Bridge Securities Purchase Agreement with Edge. Under the Fourth
Amendment, the holders of the convertible securities have agreed that, subject
to the satisfaction of conditions, they will convert all their convertible
securities based on a formula of four (4) shares of common stock for each $1.00
in value of principle and interest outstanding under the convertible notes and
for each $1.00 in value of liquidation amount of the Series A-2 Preferred Stock
and of unpaid dividends. The number of shares of common stock issuable upon a
conversion using this formula is approximately [___] million before taking into
account the reverse stock split discussed below. Furthermore, the holders of the
convertible securities have agreed not convert their convertible securities or
take any other action as a remedy under the Securities Purchase Agreement until
August 9, 2000.
The conditions Edge must fulfill by August 9, 2000 include:
o Edge must have effected a reverse stock split which converts at least four
(4) shares of Edge's common stock into one (1) share of Edge's common
stock.
o Edge must have effected the sale and issuance of its securities to
investors providing net proceeds of at least $4.0 million to Edge.
o Edge must have secured the services of Pierre Koshakji and Johann Schotte
as officers of Edge. Messrs. Koshakji and Schotte have consented to serving
in these positions, subject to Edge fulfilling certain conditions.
[Consider adding biographies]
o Edge must have paid Infinity approximately $39,000, an amount which has
been advanced by Infinity to Edge for working capital purposes.
o Edge must have restructured, on terms acceptable to Infinity, the terms of
approximately $180,000 in notes due to Infinity.
o Edge must have consummated its investment in Hencie.com, Inc.
We cannot assure our investors that the transactions discussed in this
press release will close, that such transactions will prove successful or that
unforseen developments
<PAGE>
will not occur, any of which could have a material adverse effect on our
business, financial condition and results of operations.
This statement contains references to future events and results, including
anticipated transactions involving Visual Edge Systems Inc. These statements are
forward-looking statements regarding future events and the future financial
performance of Visual Edge and no assurances can be made regarding their
eventual occurrence. Actual occurrences and results may differ substantially and
materially from those projected as a result of risks and uncertainties detailed
in Visual Edge's periodic reports and registration statements filed with the
Securities and Exchange Commission (viewable at www.sec.gov), including its Form
10-K for the year ended December 31, 1999, and Form 8-K filed in connection with
the transactions contemplated in this statement.
