10SB12G
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-SB
GENERAL FORM FOR REGISTRATION OF SECURITIES
OF SMALL BUSINESS ISSUERS
Under Section 12(g) of
The Securities and Exchange Act of 1934
FIRST FLORIDA COMMUNICATIONS, INC.
(Name of Small Business Issuer and Its Charter)
Florida 65-0662159
(State or Other jurisdiction of (IRS Employer
Incorporation or Organization) Identification No.)
5625 South University Drive, Davie, Florida 33328
(Address of Principal Executive Offices / Zip Code)
(954) 252-9577
(Issuer's Telephone Number)
Securities to be registered under Section 12(g) of the Act:
COMMON STOCK, PAR VALUE $.0001 OVER THE COUNTER BULLETIN BOARD
(Title of each Class to be so Registered) Name of Each Exchange on which
Each Class to be Registered
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FORWARD LOOKING STATEMENTS
First Florida Communications, Inc. cautions readers that certain
important factors may affect the Company's actual results and could cause such
results to differ materially from any forward-looking statements that may be
deemed to have been made in this Form 10-SB or that are otherwise made by or on
behalf of the Company. For this purpose, any statements contained in the Form
10-SB that are not statements of historical fact may be deemed to be
forward-looking statements. These statements include, without limitation,
statements relating to the Company's growth and business strategies, regulatory
matters affecting the Company, other plans and objectives of the Company,
management for future operations and activities, expansion and growth of
operations and other such matters. The words "believes,.' "expects," "intends,"
"strategy," "considers" or "anticipates" and similar expressions identify
forward-looking statements. The Company does not undertake to update, revise or
correct any of the forward-looking information.
PART I
ITEM 1. DESCRIPTION OF THE BUSINESS.
First Florida Communications, Inc. (the "Company" or FFCI) is a
multi-faceted communications and marketing company. The company is divided into
separate operating divisions. The divisions are (a) AMERICAN WIRELESS, INC. a
wireless cable television company serving Southern Utah. This division has a
cable television subscriber base of approximately 1900 residential homes. The
company has been in business for 6 (six) years. (b) PARADISE PAGING AND CELLULAR
a retail operation currently consisting of five locations in Florida and Utah.
The division sells pagers, cellular phones, accessories, repair services, and
air time to the local consumer. Markets. The company has been in business for
four years. (c) LAN SOURCE a provider of networking and internet services to
both commercial and individual customers. The company provides installation and
service contracts in Southern Utah. The company is three years old. (d) SUMMIT
MEDIA AND PRODUCTION This division was formerly known as Summit Advertising
Group but was reformed via Summit Media and Production, Inc. This new entity
will focus primarily on media production for T.V. and radio commercials. As FFCI
became more involved with full service advertising, infomercial production and
sales, and the Catalog Channel, it made a business decision to restructure its
advertising division. The preexisting Summit Advertising Group, Inc. was resold
back to the original parties for what FFCI paid for it. This new entity was
filed with the State of Florida in August, 1999. This new division provides
commercial and infomercial productions for the business community. The company
writes, films, produces, and places radio, television, and print advertising for
business. This division will be responsible for media production for "the
Catalog Channel". (e) SPECIALIZED MOBILE RADIO (SMR) this division sells and
repairs two way radios, and provides air time to commercial clients in Dade and
Broward county Florida. The SMR's have been generating minimal revenues since
1996. The Company entered into a joint venture agreement with the Henely Group,
Inc. on or about June 11, 1998, for the development of remote monitoring device
for cardiac patients. The venture dissolved due to the lack of the SMR equipment
manufacturers from developing and producing a portable receiver transmitter
unit. The Company acquired 9 separate partnerships collectively known as "the
Alliance" which were purchased separately for the amount of $200,000 per site
specific license paid in the form of company stock at the rate of $7.00 per
share. (Attached) (f) MB BROADCASTING An eleven year old advertising and media
production company serving the Western United States. (g) THE CATALOG CHANNEL a
developmental stage company that will become an internet- cable television- 24
hour shopping channel. The Company entered into a contractual agreement with
Jones Space Holdings to lease SATCOM3 Transponder 20 for the next five
years. (Attached) The Company entered into a contractual agreement with Tiger
eye, Inc., a television broadcast company, which will provide coverages ranging
from 6hrs. to 24hrs. seven days per week to its individual affiliate stations
with
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approximately 5.2 million households in the corresponding viewing areas.
(Attached) The first on air broadcasts began in September, 1999.(Attached) The
Company has entered into a contractual agreement with The Video Catalog Channel
which will provide a guaranteed revenue of $40,000.00 per month. (Attached)
The company believes that the future of the company will be dependant
on the success of "the Catalog Channel" and the division which supports its
growth, Summit Media and Production. The company (FFCI) will determine the
future of Paradise Cellular and Paging, SMR, American Wireless, Inc., and MB
Broadcasting within the next twelve months. The LanSource acquisition has been
recinded by FFCI for the return of the original stock given and has received
equitable value in the form of services and merchandise for any revenues
invested by FFCI during its time of ownership. (Attached)
BACKGROUND:
The Articles of Incorporation were filed on April 1, 1996, in the State
of Florida as a Florida Corporation by the incorporators: Paul Richard Bell, Jr.
and Richard P. Greene and an experienced team of engineering, technical, and
marketing professionals to enter into the communications industry. The Company
had acquired the rights to a group of 220 MHZ Specialized Mobile Radio licenses
in 30 cities throughout the United States to provide two-way radio
communications. FOCI has expanded its operations to include wireless cable
television, paging and cellular retail stores, advertising, media production,
and business communications and Internet operation solutions. In 1999, the
Company launched a 24-hour television shopping network "The Catalog Channel."
DIVISIONS AND SERVICES:
The Company's services are varied and are carried out through the
diverse operating divisions within the Company with each division being a
separate subsidiary. The divisions within the company are the following:
ENTITY DATE ACQUIRED COST/STOCK-SHARES ASSUMT. DEBT
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Paradise Cellular/Paging October, 1998 $350,000/43,750 $10,000.00
MB Broadcasting January, 1999 $3,000,000/600,000 00.00
American Wireless May, 1999 $7,900,000/1,200,000 00.00
Summit Advertising Group March, 1999 $1,500,000/300,000 00.00
Catalog Channel March, 1999 $100,000/ N/A 00.00
Lan Source June, 1999 $600,000/85,714 00.00
PARADISE CELLULAR AND PAGING: This is a retail entity that sell pagers,
cellular phones, does repair work, and is a reseller of paging and cellular air
time. This subsidiary has 9 full time employees and is headed by Ronald Stull.
The subsidiary currently has 4 stores in South Florida and one in Salt Lake
City, Utah. The company anticipated opening as many as 24 stores within one
year; however, the plans were changed based upon the diversion of capital to
fund the Catalog Channel. The Company anticipates opening as many as three more
stores within the next 12 months. The monies used to open these stores will come
from FFCI revenues. FFCI had originally planned to be opening 24 stores per year
based upon its franchise and business plan. With the time, energies, and
investitures involved in its other divisions, FFCI has made a business decision
to proceed with its Paradise division on a slower and smaller scale.
SMR DIVISION: Provides two-way radio sales, services, and air time to
commercial business. The division has the license rights to 50 220 MHZ 5-channel
locations throughout the United States. At the present time, due to lack of a
functioning portable radio for the commercial end user, only one 5-channel
system in Miami, Florida has subscribers on line. Portables for 220 SMR MP1327
have been type accepted for production by the FCC, but due to the cost factors
to supply the marketplace, the 3rd party manufactures (Midland, E F Johnson, and
Securicor)
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have not manufactured the portable for the retail marketplace, Motorola, Inc. is
manufacturing the radios for U.S. export only. FFCI is not in a financial
position to become a manufacturer. It is anticipated that portable radios will
be available in the future and then the Specialized Mobile Radio ("SMR") Systems
will become active sources of revenue for FFCI.
FFCI had the license rights to 70 different site locations. FFCI chose,
due to an in house marketing decision, to develop only 50 sites.
Only one SMR system is currently in retail operation with customers,
The revenue a site will generate is based on a set monthly fee based on a
contract of 1-2 or 3 years.
On January 15, 1998, the Company purchased the license, equipment, and
site rights for the Miami, Florida license owned by MacMillan Bell Group, Inc.
for a total of 500,000 shares of company stock at $1.00 per share. The Company
acquired 40 of its 220 SMR licenses from MacMillan Bell Group, Inc. on May 26,
1998, which included all equipment on the individual tower cites for a total of
3,710,526 shares of restricted common FFCI stock based on a $1.00 per share
value. The principals of MacMillan Bell Group, Inc. were Paul Richard Bell, Sr.
and Christina Bell, the Father and Sister of Paul Richard Bell, Jr., the
President of FFCI. The Company also acquired 9 separate, individual general
partnerships which were collectively known as "the Alliance" which were
purchased separately for the amount of $200,000 per site specific license paid
in the form of company stock at the rate of $7.00 per share. Each individual
partnership had approximately 40-50 partners, none of whom were related to any
company employees. All licenses acquired by the company were free of any
litigation associated with the former owner nor any of the principals in the
former corporations or partnerships.
MB BROADCASTING: This media production and advertising company was
acquired in 1998. They produce infomercials and a television news show for
Southern Utah. The division has nine full-time employees who are media writers,
graphic design artists, computer specialists and two full-time sales
representatives. MB owns four television translators and brings two major
television signals (Fox and NBC) into their marketplace. A television translator
is defined in Section 74.731 of the FCC Rules and Regulations. (a) Television
broadcast translator stations provide a means whereby the signals of television
broadcast stations may be retransmitted to areas in which direct reception of
such television broadcast stations is unsatisfactory due to distance or
intervening terrain barriers.
MB Broadcasting "brings In" or by means of translators "rebroadcasts"
the primary signal of Major Market Television stations into the Southern Utah
area. These translators have been assigned (by the FCC) call signs/call letters.
The Station KDLQ-TV Channel 55 rebroadcasts the signal of KSTU-TV (FOX Salt Lake
City, Utah) MB also operates KVBT-TV Channel 41 which rebroadcasts the signal of
KVBC-TV (NBC Las Vegas, Nevada)
In September, 1999, the Company signed an agreement in which MB
Broadcasting would manage 4 radio stations which broadcast in the Southern Utah
area along the I-15 corridor between Salt Lake City, Utah, and Las Vegas,
Nevada, which doubled their gross billing of over $120,000.00 for the month of
October, 1999.
Prior to the addition of Summit Media and Production it was anticipated
that MB Broadcasting would provide the production and engineering for the
Catalog Channel. This is no longer the case.
SUMMIT ADVERTISING GROUP: Summit Advertising Group is being reformed
via Summit Media and Production, Inc. This new entity will focus primarily on
media production for T.V. and radio commercials. As FFCI became more involved
with full service advertising, infomercial production and sales, and the Catalog
Channel, it made a business decision to restructure its advertising division.
The preexisting Summit Advertising Group, Inc. was resold back to the original
parties for what FFCI paid for it. This new entity was filed with the State of
Florida in August, 1999, as SUMMIT MEDIA AND PRODUCTION, INC. This new "Summit"
is currently operating out of the companies corporate headquarters in Davie,
Florida, and headed by Wayne Wiggins, two time emmy award winning director.
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THE CATALOG CHANNEL: This subsidiary will be a 24-hour television
shopping network featuring brand name catalogs combining the print catalog,
television, and the Internet e-commerce shopper. The Catalog Channel has
completed an agreement to lease a transponder on SatCom 3 which will cover North
America, including Canada, the United States, and Mexico. It is anticipated that
The Catalog Channel will have 20 million households on cable systems it will
service within 12 months after its initial launch anticipated during the late
summer or early fall of 1999.
The Catalog Channel currently is broadcast to over 5,000,000 homes with
a new agreement to reach an additional 3,000,000 homes.
FFCI's Catalog Channel will bring to the buying public a convergence of
the print catalog, the cable television home shopping experience, and Internet
e-commerce business. The Catalog Channel brings to consumers brand name catalogs
with the ability to run specials from the catalog and to drive people to the
Internet e-commerce site with more special prices built around brand name
catalog identities that consumers know and trust. By combining the catalog
industry's diverse product inventory, merchandising expertise, in-place
fulfillment organizations and trusted consumers' relationships with
Internet-based sales tools and developing brand identity, The Catalog Channel
will deliver the first complete catalog shopping experience - PRINT, TELEVISION,
and ON-LINE.
Although FFCI is developing the catalog media productions, the
necessary cable operators for the number of households, and alliances with the
Internet e-commerce providers, The Catalog Channel's success hinges on the three
interrelated nontechnical factors which include: (1) alliances with catalog
merchant partners who provide the content, (2) branding the first complete
convergence of the catalog shopping experience - print, television, and on-line,
and (3) a reputation for quality customer service and a safe, user-friendly
shopping environment. The Catalog Channel will be well-positioned for success in
the convergence of print, television, and on-line for the catalog business.
AMERICAN WIRELESS: A Southwestern Utah provider of wireless cable
television. There are currently approximately 2,000 subscribers paying an
average of $30.00 per month for service. The company sells and services the
subscriber needs on this 140-channel system. In the Spring of 1999, this
subsidiary began a joint venture with communications giant Motorola to implement
a high-speed wireless Internet delivery system. The tests and implementation as
of June 23, 1999, were underway in St. George, Utah. The acquisition of American
Wireless was accomplished by contractual agreements of stock transfer with
individual stock holders of American Wireless. In January of 1999 we had
acquired approx. 47% of American Wireless stock and by May of 1999 we had
acquired approx. 92% of the total outstanding stock. (Attached you'll find the
Motorola agreement between American Wireless and Motorola).
ACQUISITIONS OF OTHER COMPANIES AND/OR PRODUCT LINES:
The Company has had, and will continue to have, discussions from time
to time with potential acquisition candidates.
CUSTOMER RELATIONSHIPS:
CUSTOMER RELATIONSHIPS
The Company has seven distinct types of client relationship depending
on the Division of the company, the customer deals with.
1. PARADISE CELLULAR AND PAGING These customers are all retail
clients who purchase goods and services through retail stores. The
customers can purchase cellular phones, pagers, accessories
(cases, batteries, etc.) repair services, and monthly service for
new or existing pagers (Paradise is a reseller of airtime for
airtime service providers such as City Beepers, Page Net, Priority
Paging, Mobilcom, TSR inc., ABC Paging, Air Page, Pagenet, Alpha
Net, and Pro Page. Currently the company is an authorized agent
for Primco for cellular phones. The company is currently
negotiating with ATT and Sprint to become a reseller.
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2. SPECIALIZED MOBILE RADIO These customers are retail clients who
purchase two-way radio communication equipment, repair, and
service. The customers are basically transportation, deliveries,
or service providers (such as electricians, plumbers, tow trucks,
etc.) The company currently is operating the Miami site only and
has approximately 200 customers at a rate of $18.00 per month.
3. AMERICAN WIRELESS This company division provides wireless cable
television service to approximately 1900 subscribers in Southern
Utah. The customer profile is primarily a residential client
paying a monthly rate of $25.00 for basic services and additional
fees for premium and pay per view channels.
4. MB BROADCASTING This company division provides advertising and
production services to business clients in Southern Utah. This
division designs, writes, produces, and films multimedia
advertising pieces for clients ranging from car dealerships,
retail stores, and various service providers.
5. SUMMIT MEDIA AND PRODUCTION The division is newly formed to
provide programming production for "the Catalog Channel" and the
general business market needing professional advertising services
for commercial and infomercial media production.
6. THE CATALOG CHANNEL the company will have relationships with the
providers of products for resale over its television broadcast and
with the consumer market who purchases the products shown. The
consumers will be dealing directly with the product providers by
way of toll free numbers or web sites. As the company grows it may
produce and sell its own products to the consumers in the future.
Initially the clients are infomercial providers such as Anthony
Robbins, Orange Glo, Thigh Master, etc.
GOVERNMENT REGULATION:
The Company will be subject to applicable provisions of federal and
state securities laws and to regulations specifically governing the
communications industry. The operations of the Company will also be subject to
regulations normally incident to business operations (e.g. occupational safety
and health acts, workmen's compensation statutes, unemployment insurance
legislation and income tax and social security related regulations). Although
the Company will make every effort to comply with applicable regulations, it can
provide no assurance of its ability to do so, nor can it predict the effect of
these regulations on its proposed activities.
The Specialized Mobile Radio (SMR) and the Paradise Cellular and Paging
Divisions are not only regulated by applicable state and federal laws concerning
sales practices, but also by the Federal Communication Commission (FCC) rules
and regulations as to the ownership and use of SMR licenses. FCCI is the owner
and or manager of fifty 220-222 MHz radio service licenses. These licenses allow
two way voice, data, and paging communication. On February 19, 1997, the FCC
adopted the 220 MHz Third Report and Order. The FCC guidelines gives 220 MHz its
operating rules and requirements, The FCC licenses that are owned by FFCI must
be kept up in operating status and renewed every five years. Each license gives
the location site of the antennae, the power output for the equipment, the
necessary height of the antennae, and the licenses renewal date. FFCI has a
designated department to keep up with its license obligations. Currently, only
one license (Miami) is in full commercial operation. The other 220 MHz licenses
are being kept in FCC compliance, The renewal cost for each license for a five
year period is approximately $150.00 including FCC filing fees and associated
legal and labor costs.
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INDUSTRY AND COMPETITION:
The communications industry continues to evolve at a phenomenal rate.
Internet - online consumer spending is projected to increase from $7.8 billion
in 1938 to $108 billion in 2003. The primary drivers for this growth are the
increase of households with Internet access and an even greater acceptance of
online shopping among consumers. The percentage of U.S. households that use the
Internet has increased from l4% in 1995 to 41% in 1998.
The Company has made a business decision to focus its time and energies
on the development and growth of the Catalog Channel.
The Company is well placed with its advertising and media production
companies to enter into the television shopping industry with its new division
"The Catalog Channel." The print-based catalog industry sells more than $100
billion worth of products each year to approximately 150 million consumers
worldwide. Last year, in the United States, approximately 15,000 catalog
merchants mailed more than 13.9 billion paper catalogs at a cost of 70 cents per
delivered catalog. Over the past 35 years remote shopping offered by merchants
has improved significantly, including the quality of the presentation, diversity
of product selection, improvements in fraud prevention, quick delivery of
product, personalization of product mix and customer service.
In the last 10 years television shopping networks have become very
important avenues for merchandise sales. In 1998, QVC had almost $2.4 billion in
sales revenue and The Home Shopping Network did $1 billion in sales. Both
networks were on cable television systems with approximately 70 million
households each.
The consumer demand for more television channels seems to be boundless.
Wireless cable can now provide hundreds of television channels for consumers to
choose from in the "digital" age. And now the wireless cable operator can
deliver not only television, but data, Internet and telephony services as well,
The catalog industry has worldwide revenues of more than $100 billion
and serves more than 150 million consumers. Approximately 17,000 catalog
merchants mail almost 14 billion paper catalogs in the U.S. These merchants
range in size from $500 million industry giants to Whom and Pop" operations that
create catalogs in their homes. In 1996, the U.S. catalog industry was evenly
divided between business to business and consumer catalogs. This market tends to
be highly skewed in favor of the top 200 to 300 firms, which control more than
80% of the market.
The catalog industry has existed for many years. However, between the
1960s and 1995, a combination of demographics changes, technology improvements
and government regulations caused a rapid growth in the number and quality of
mail order catalogs. These factors include (1) more women working with less time
to shop, (2) higher education among shoppers with greater willingness to buy at
a distance, (3) computer databases, (4) credit card popularity, and (5) FTC
regulations that removed fraudulent merchants. The industry continues to grow
both in terms of consumer acceptance and in the markets that it reaches.
Globalization has helped to create more than 9,000 catalog companies in the USA,
France and Germany. Consumer direct marketing sales are forecasted to grow by
7.7% annually from 1998 to 2003 compared to US consumer sales that are
forecasted to grow 5% annually.
Marketing sector competition includes the current home shopping
networks (i.e. QVC and Home Shopping Network), catalog agregators (i.e. Catalog
Site), non-specialty Internet e-commerce players, category killer commerce sites
(i.e. Amazon.com) and product search engines and price comparison software.
The SMR subsidiary is undergoing rapid change. The two way radio
business (SMR) has been primarily the communication systems of choice for
private service and delivery businesses and public service providers (police,
fire, and ambulance). The SMR industry sold mobile and portable phones at a
20-30% retail markup and charged air time use on a contractual basis for between
$15-$25 per radio per month. The cost of airtime was in the $1-$5 ranges. These
rates and charges made for a profitable industry based on the number of radios
and airtime sold. For example: an SMR system (1-FCC license) with 500 radios and
therefore 500 air time subscribers @ $20.00 per month would have generated a
monthly revenue of $10,000 gross and a net
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(gross minus tower site and maintenance costs (averaging $1,500 per month) of
$8,500 per month. However, in today's competitive climate, Nextel and other
cellular companies are virtually giving away the radios at cost or even a loss
and then charging by the minute with per minute charges as low as five cents,
The communications market as far as SMR is now highly competitive and the profit
margins are dropping rapidly, The future for specialized mobile radio will see
net profits declining from past numbers, The question to be answered is will the
cost of the SMR radios drop in price to become more competitive with Nextel and
the cellular marketplace, FFCI believes SMR's will stay competitive and will
continue to grow because the SMR" at $20.00 per month unlimited talk is still a
better price than even 5 cents per minute being offered by the competitors. The
key will be the marketing efforts on behalf of the SMR" to the business company
end users and decision makers.
The Paradise Paging subsidiary faces competition from within the paging
industry itself. The retail prices of pagers continue to give the company profit
margins of 30% and more (example: the most popular retail pager is the Motorola
LS 550 which sells for $69.95 and the cost is $45.00). The competition for
clients is focusing on the cost of air time. Paradise is a reseller of air time
to the end user. IN the Paradise market place the retail price of local pager
air time has declined from $12.00 per month to the current average monthly rates
of $4.00 per month. The cost of local air time is between 50 cents and one
dollar per month. The profit margins even though they have declined
significantly are still very substantial. The future of paging continues to be
both very competitive and very bright. Two way paging and the alpha numeric
pagers continue to gain new market shares.
American Wireless Inc., the wireless cable operator in Southern Utah,
is faced with continuing competition. The cable industry in general due to
mergers is becoming increasingly competitive and cable revenues, though
increasing, are declining in net profits. The local cable television competitor
is Falcon Cable which has been bought out by one of the founders of Microsoft,
Paul Allen, this year, 1999. To maintain a competitive position, American
Wireless must become a fully digital system. Today American Wireless is half
analog and 1/2 digital. This situation cannot continue to compete on an equal
basis with its competitors Digital offers over 100 channels in comparison to
Analog which only offers 32. Both cable operators charge approx. the same basic
fees ($25.00 per mth). Falcon Cable with its "deep pockets" continues to add to
its channel selection It is questionable whether American Wireless can
successfully compete in its local market place without a very large infusion of
capital (approx. $4M). FFCI at this time does not have the resources to provide
the necessary capital. The relationship with American Wireless is tenuous at the
very best.
EMPLOYEES:
The Company currently employs 35 full-time professionals.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
The auditors concern in the 1997-98 audited financial statements are
based on historical information as to the companies losses and limited revenue
growth. To this end, the auditors talked with both major outside investors that
committed to continuing to fund the company during the development stage. This
discussion involved the amount of the commitment and the level of expectation
from First Florida.
The Company had revenue of $102,102 for the year ended December 31,
1998 as compared to $45,161 for the year ended December 31, 1997, an increase of
$59,941 or 126%. Cost of sales were $96,662 for the 1998 period in comparison to
$31,265 for the
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1997 period, an increase of $65,397 or 209%. Operating Costs and Expenses were
$791,731 for the year ended December 31, 1998 as compared to $225,933 for the
year ended December 31, 1997, an increase of $565,798 or 2S0%.
Net cash (used) in Operating Activities for the years ended December
31, 1998 and 1997 was ($483,441) and ($222) receptively. The change in cash from
operating activities was $483,212.
Net cash used in investing activities was ($4,986) and $425) for the
years ended December 31, 1998 and 1997 respectively, reflecting a change of
($4,561). This was a result of an acquisition of furniture and fixtures from
Paradise International.
The Company's financing activities included proceeds from acquisitions
in exchange for common stock and stock warrant conversions. The Company's
financing activities resulted in net cash provided from the exercising of stock
warrants in the amount of $500,600 for the year ended December 31, 1998. Their
were no financing activities in period ending 1997. The Company's material
capital commitments are the lease of Satcom3 Transponder 20 with Jones Space
Holdings, the contractual obligation with Tiger eye for broadcast television
stations, and 220SMR tower site rentals. The Company will be able to fund those
capital commitments through its revenues from the Catalog Channel which includes
the contract with the Video Catalog Channel and the deconstruction of tower
sites which eliminates those tower site rentals. The Company believes it will be
able to fund its short term cash needs through funds from operations and
additional capital raising efforts which include the future registration of
shelf stock, a secondary offering, and continued support from our current
venture capitalist, Venture Capital USA.
Net income (loss) increased from a loss of ($212,037) for the year
ended December 31, 1997, to a net loss of ($786,291) for the year ended December
31, 1998, a change of ($574,254) or 270~. The increases in losses from December
31, 1997 to December 31, 1998 was the introduction and additions of cellular
phone, paging services, and acquisition of one group of nine Alliance
partnership 220 MHZ licenses and a second acquisition of 41 220 licenses and
equipment from a non-operating specialized mobile radio company.
The Company's management believes there is tremendous opportunity in
these new sites and licenses, as well as a good fit with the strategic direction
of combining like business in the wireless industry. The effect of these
additional sites and licenses will be reflected in 1999. As the need for data
delivery systems becomes more of a revenue factor in our SMR communications
systems, we believe the revenue from using the systems from data will at some
point in the future surpass the us of voice revenue. The FCC licenses allows for
voice, paging, and data. The future of SMR is in the us of data transmission
where there is little competition. Whereas in the voice market, the competition
will always be with the cellular carriers. It is anticipated that Motorola and
other manufacturers will begin to release data hardware onto the market during
1999 or the year 2000. It is also a distinct posiblity the company will find
buyers for some of its SMR sites.
At December 31, 1998, the Company had total assets of $4,204,594 and
total liabilities of $416,447. The Company has working capital of $12,587 as of
December 31, 1998, as compared to $414 as of December 31, 1997.
The Company currently has had the following significant subsequent
acquisition events in 1999:
In January 1999, the Company acquired all the stock of MB Broadcasting,
Inc., for shares of common stock. MB Broadcasting is a Utah cable
television and TV production company.
In March 1999, the Company acquired the net assets of Summit
Advertising, which has been reformed as Summit Media and Production,
for $100,000 in cash and shares of common stock. In so doing, the
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Company has been able to have the original Company stock returned
and replaced in the Company treasury.
In June 1999, the Company acquired LanSource, an Internet design and
services company for shares of common stock, which as previously
stated has been rescinded and all expenditures and stock have been
replaced into the Company treasury.
In June 1999, the Company acquired approximately 90% of American
Wireless, a wireless cable and wireless Internet service provider
for shares of common stock.
In conjunction with the four 1999 acquisitions and subsequent events,
the Company has received funding from two private sources as follows:
1. $1.2 million as exercise of outstanding warrants, Venture Capital
USA. In response to the Company's June 12, 1998, press release
entitled, "First Florida Communications Inc. Acquires US $1.5
Million Expansion Funding", All communications with "International
Index Savings Portfolio Ltd." Went through Venture Capital USA.
Venture Capital USA was who we had the $1.5 Million dollar agreement
with; "Index" was one agency that Venture Capital USA had a
commitment from or with. Venture terminated their agreement with
"Index" and continued to provide funds to FFCI as agreed on. There
was only one agreement between FFCI and Venture Capital USA to
provide $1.5 million dollars. The warrants were issued as per the
Venture Capital USA agreement.
2. $900,000 as exercise of warrants by Global Asset Management.
During the second quarter, 1999, the Company has also announced the
1. Formation of a new subsidiary, The Catalog Channel, which first
aired in September, 1999, using elements and management talent from
all the recently acquired companies and the Company.
2. The resignation of Paul Richard Bell, founder, as President and
Chief Executive Officer and the appointment of Douglas Costa as
President and Chief Executive Officer.
The Company's management believes that with the recent capital
infusions and the eminent launch The Cable Channel, the Company is positioned to
greatly enhance its revenue growth and value during 1999.
Financial notes and explanations:
(1) The company earns revenues from various services and products. In regards
to SAFAS 131, at the time we filed our original audit the only revenue
producer was Paradise on a cash basis.
(2) Our revenue recognition policy as per APB OPINION 22 - as of 12-31-98 same
as above.
(3) Our comprehensive income/loss is the same as our net income/loss.
(4) [attached the '98 financial statements for Paradise] The Alliance group,
the individual 220 SMR partnerships that we acquired had no financials and
no revenues. For compliance, we verified their licenses and assets.
(5) In accordance with APB OPINION 16, paragraph 96, FFCI acquired the assets,
net of liabilities of Paradise International Connection on October 1, 1998
in a transaction of 43,750 shares of common stock with a net valuation of
$30,804, using the Purchase method of accounting. Acquisition price was
$350,000 paid in the form of stock. The acquired company, Paradise,
consisted of two small retail stores that sell communications products and
services, based in Ft. Lauderdale, Broward County, Florida. As Paradise was
a sole propriortership, prior to acquisition by FFCI, the financial
10
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statements presented for 1998 only include operations for the three months
of October, November, & December, 1998. Goodwill of 319,195 was recognized
and immediately written off. No contingent payments, options or commitments
were specified or included in the agreement. Consideration (issuance of
FFCI stock) was issued immediately following the transaction and no
contingency period remains.
(6) FFCI accounted for the acquisiton of communication equipment and 41 FCC
licenses from the MacMillan Bell Group, Inc. We recorded these assets at
less than historical costs and reduced those assets by 25% as impaired
assets since they were non-performing. FFCI was founded by Paul Richard
Bell, JR with Paul Richard Bell, SR. being a majority stock holder of 2.6M
shares for his sale of MacMillan Bell Assets to FFCI. FFCI had some SMR
licenses and miscellaneous furniture, etc. at a value of less than
$50,000.00.
(7) As of December 1998, 1.2M warrants outstanding to Venture Capital USA.
(8) Our depreciating methods for fixed assets is as follows: Straight Line
Depreciation for Office and tower equipment 3-5 years.
(9) The Company's accounting policy for assessing impairment based upon SFAS
121 is to amortize the FCC licenses over the life of the service for which
they are issued by the FCC. The life expectancy is for 5 years and they are
renewable with a new life term of an additional 5 years.
(10) The company believes it will need $5M over the next 12 months to continue
to expand and implement its revenue sources. The Company has a commitment
from Venture Capital USA to fund $5M based upon the company becoming a
reporting company.
YEAR 2000 ISSUE:
The primary business of the Company has become the Catalog Channel. GE
Satcom3 transponder 20, which is leased from Jones Space Holdings, has informed
the company they have reported to the FCC that they are in full compliance for
the Y2K. Each television station that carries the company's broadcast must be in
full compliance for Y2K based on their FCC license requirements.
The company is involved in selling communications devices and services
based in South Florida, USA. The company's principal markets are local, within
50 miles of Ft. Lauderdale, FL. The company is in the process of acquiring
complementing business in other sections of the United States.
FFCI's computer systems for accounting, administrative and sales are
PC's with standard, off the shelf software (Microsoft) that is upgradable and
compliant for Year 2000. These PC's are stand alone and not networked. 95% of
FFCI's business is cash and carry, retail sales that are recorded the day of the
transaction.
The company's operating officer took a survey of major vendors and
suppliers to determine if our major suppliers were able and capable to ship
product, under adverse Year 2000 problems. FFCI determined that we could
continue to place orders and receive orders on manually prepared paperwork, as
long as communication devices are available. In the event of telecommunications
failure, FFCI can procure locally the necessary materials to continue sales
efforts. In the event of shipping company failures, FFCI can pick up materials,
locally. All FFCI service centers that are currently operating are within
driving distance of less that 50 miles from company headquarters.
Repair parts and equipment can also be procured locally; with the same
stipulations as noted above on materials for sales.'
The company does not anticipate any material interruption, however, in
a worse case scenario, the replacement of PC's and office software is estimated
at
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<PAGE>
less that $25,000. Replacement of other, outside software; used for service is
estimated at less than $10,000. In the worse case scenario, this would
materially effect sales efforts with a range of 0 to $22,000 per month. This
would reflect a loss of an additional $264,000 if annualized. The company does
not have a key IT assigned person, as duties are shared with several
individuals.
At present, the company does not have any material contracts with
customers or suppliers, which represent any portion of sale greater than two
percent. Risk considerations that can materially effect the company would be a
complete collapse of telecommunications and utilities with regulated carrier
infrastructure. The company believes this is highly unlikely.
ITEM 3. DESCRIPTION OF PROPERTY
The Company's offices are located at 5625 South University Drive,
Davie, Florida 33328. The lease ends December 1999, with a rent expense of
$4,000 per month. The Company also leases retail store space under operating
lease agreements. The future rental obligations for Paradise retail stores of
the Company are as follows:
Hollywood Miramar
1999 11,800 4,800
The Company also has certain tower rent obligations that were assumed
as part of the acquisition of prior telecommunications tower rent liabilities.
These tower rent leases are currently being renegotiated and revised to reflect
the change of ownership and equipment on the sites. Towers are deconstructed
when they are non-operational. At that time there can be no liens placed upon
the communications equipment on that tower site.
PRINCIPAL STOCKHOLDERS
The following table sets forth information concerning the beneficial
owners of the Company's outstanding common stock as of October 20, 1999, with
respect to the beneficial ownership of shares of Common Stock by (i) each person
known by the Company to be the beneficial owner of more than five percent of the
outstanding shares of Common Stock, (ii) each of the Company's directors, and
(iii) all executive officers and directors as a group. Unless otherwise
indicated below, all persons listed below have sole voting and investment power
with respect to their shares of Common Stock except to the extent that authority
is shared by spouses under applicable law.
NAME AND ADDRESS AMOUNT AND NATURE OF
OF BENEFICIAL OWNER (1) BENEFICIAL OWNERSHIP (2) PERCENTAGE OF CLASS
- --------------------------------------------------------------------------------
Paul Richard Bell, Sr. 2,876,336 34.5%
5625 South University Drive,
Davie, FL 33328
Christina Bell Landers 1,000,000 12%
5625 South University Drive,
Davie, Fl 33328
Douglas Costa 232,397 2.7%
5625 South University Drive,
Davie, FL 33328
12
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Kent Whitesel 4,500 .0005%
5625 South University Drive,
Davie, FL 33328
All executive officers and directors 4,113,233 49.2%
(1) none of the aforementioned principal stock holders have a right to acquire
any additional shares within the next 60 days.
(2) A person is deemed to be the beneficial owner of securities that can be
acquired by such person within 60 days from the date of this Registration
Statement upon the exercise of options or warrants. Each beneficial owner's
percentage ownership is determined by assuming that options or warrants that are
held by such person (but not those held by any other person) and which are
exercisable within 60 days of the date of this Registration Statement have been
exercised. Unless otherwise indicated, the Company believes that all persons
named in the table have voting and investment power with respect to all shares
of Common Stock beneficially owned by them.
13
<PAGE>
ITEM 5. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS
The directors and executive officers of the Company, and significant
employees of the Company are as follows:
NAME POSITION
Douglas Costa, Esq. Chief Executive Officer
Kent Whitesel Chief Financial Officer
Paul Richard Bell, Sr Chairman of the Board
Christina Bell Landers Secretary/Treasurer
Ronald Stull General Manager Paradise Paging - SMR
Wayne Wiggins General Manager Summit Media and Production
Nyhl Henson Consultant
All directors will serve until the next annual meeting of Shareholders,
which is anticipated to occur in February, 2000.
DOUGLAS COSTA, ESQ. has served as CEO and President since March 1999. He is a
practicing attorney and an educator. He was and is licensed to practice law in
Florida in 1990 and Washington D.C. in 1992. From the years 1986-1994 he worked
as an adult and community school administrator supervising over 90 employees and
an assistant high school administrator supervising over 120 employees being
responsible for finances, budgeting, personnel, and supervision. He worked with
the law firm of Latona and Isenberg which specialized in corporate law and SEC
litigation from 1990-1994. He specialized as a sol practitioner from 1994-1999
in the areas of corporate law, employment law, business law, family law,
immigration law, and general litigation. His private practice has grown to two
associates and three additional employees. He was corporate counsel for
MacMillan Bell Group, Inc. from 1997. He served as corporate attorney for FFCI
since May 1998 during which time he assisted in negotiation, formation, and
construction of all of the company's mergers. He also incorporated the various
subsidiaries within the company. As a member of the FFCI board of directors
since May 1998. His degrees are from the University of Florida (BA-1970), Nova
University (MS-1984), and the University of Miami School of Law (JD-1990).
KENT WHITESEL has served as the CFO for the Company since October 1998. Prior to
joining the Company, he was the CFO for a major shipping line with 17
subsidiaries. His background includes controllership with a major NYSE firm and
audit and accounting work with one public companies. He has an MBA-1988
(Finance) from the University of Southern California and a MA-1982 (Accounting)
form the University of Redlands and his BA-1978 from Southern Utah State
College.
PAUL RICHARD BELL, SR has an extensive background in education, business,
advertising and marketing, He received his BS.Ed degree in 1972 and his M.Ed.
degree in 1973 from the University of Arkansas. From 1973-1976 he was employed
as an instructor, then Assistant Professor in the School of Systems Science at
the Arkansas Tech. University. His responsibilities involved teaching media and
film production as well as general courses in recreation and park management.
Mr. Bell has served with the National Board of YMCA's to develop new YMCA's in
local communities. From 1981-1994 he worked in the commodity industry as a
broker and later as a manager responsible for advertising and marketing. During
this time he was involved in a litigation between the Commodity Future Trading
Commission and his employer, JCC Inc. and its principals. (Attached) In 1993, he
founded MacMillan Communications, Inc. specializing in the wireless
communications industry. In 1994, he was one of the founders of Media Response,
a national advertising company specializing in radio and television. He was
14
<PAGE>
responsible for generating revenues of over $4M annually. In 1998, he was one of
the original founders of Summit Advertising Group. He became a director and
Chairman of the Board and CEO of FFCI in June of 1998. He resigned as CEO in
March of 1999. He is the father of Christina Bell Landers the company's
secretary/treasurer.
CHRISTINA BELL LANDERS is one of the Company's original founders. She was one of
the founders of Highland Bell Collectibles specializing in rare coins and sports
memorabilia where she supervised 5 employees and was responsible for purchases
and advertising. She produced and directed "Financial Focus" a two hour national
radio talk show (1989-1992). She is the daughter of the chairman of the Board,
Paul Richard Bell, Sr. She began serving as a corporate officer for the Company
in May June 1999.
RONALD STULL has been in charge of the SMR and Paradise Cellular and paging
Divisions since August 1998. Prior to joining the Company, he was a manager in
radio tower site business and two way radio sales. He is a communication
engineer with various positions with Motorola over a 10 year period in their two
way radio and paging business. He received an AS-1978 in engineering from South
Georgia Tech. He worked as a site engineer for Industrial Communications in
North Miami Florida for 5 years starting in 1993.
WAYNE WIGGINS has won Emmys for his work as a producer/director in the
television industry. He brings more than 20 years of experience in media
production and advertising. His career includes CBS television and numerous
national and international productions and infomercials. He won two television
Emmy and over 71 "addys" which are the advertising equivalent to an Emmy or
Oscar. During his career with CBS he worked as a camera and lighting director
from 1968-1984, from 1970-1971 he managed a staff of 12, from 1971-1984 he was
the technical director of various programs (NFL Football, Baseball, Hockey, NBA
Basketball, soap operas, game shows, and special programs),and from 1984-1989 he
worked for R.W. Reynolds, Inc. in advertising/freelance director of sporting,
live programming, and news events. In 1991 he wrote the screen play "Bop" for
Orion Pictures which featured Rodney Dangerfield Mr. Wiggins joined Summit
Advertising in June 1999. He earned a BA from the University of South Florida in
mass communication and marketing.
NYHL HENSON began working as a consultant with the Catalog Channel for FFCI in
August 1999. Mr. Henson has an extensive background in TV programming gaining
his background while working for Warner Communications. He created one of the
earliest TV shopping formats "TeleAuction". In 1979 Henson became Director of
Satellite Communications and launched "The Movie Channel". In the 1980's Henson
was instrumental n the creation of "Nickelodeon". After leaving Warner, Henson
produced the first pay-per-view events.
All directors hold office until the next annual meeting of stockholders
and until thelr successors have been elected and qualified, subject to death
resignation or removal from office prior to such time.
ITEM 6. EXECUTIVE COMPENSATION
The following table sets forth the total corporate officers and general
managers of the Company remuneration to be paid to the
ANNUAL COMPENSATION ARE!
NAME AND OTHER ANNUAL
PRINCIPAL POSITION YEAR SALARY BONUS COMPENSATION TOTAL
- ------------------------------------------------------------------------------
Douglas Costa 1999 $ll7,700 $-0- $ 4,200 $l21,900
Corporate Counsel
President & CEO
15
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Paul Richard Bell 1999 $150,000 $-0- $-0- $150,000
Chairman & Consultant
Kent Whitesel 1999 $90,000 $-0- $-0- $90,000
CFO
Christina Landers 1999 $52,000 $-0- $-0- $52,000
Secretary/Treasurer
Wayne Wiggins 1999 $39,000 $-0- $-0- $39,000
General Manager
Ronald Stull 1998 $60,000 $-0- $-0- $60,000
General Manager
There is not at present any compensation paid to directors of the
Company in their capacity as such.
The Company does not at this time have a stock option plan or other
incentive compensation plan.
ITEM 7. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
On January 15, 1998, the Company purchased the license, equipment, and
site rights for the Miami, Florida license owned by MacMillan Bell Group, Inc.
for a total of 500,000 shares of company stock at $1.00 pr share. The Company
acquired 40 of its 220 SMR licenses from MacMillan Bell Group, Inc. on May 26,
1998, which included all equipment on the individual tower cites for a total of
3,710,526 shares of restricted common FFCI stock based on a $1.00 pr share
value. The principals of MacMillan Bell Group, Inc. were Paul Richard Bell, Sr.
and Christina Bell.
At various times Mr. Bell has advanced monies to the Company as
shareholder loans. Terms of the loan were at 9% interest with open ended payback
terms.
ITEM 8. DESCRIPTION OF SECURITIES.
GENERAL
As of the date of this Registration Statement, the authorized capital
stock of the Company consists of 20,000,000 shares of Common Stock, $.0001 par
value, of which 8,251,749 shares are outstanding. The following description of
the securities of the Company and certain provisions of the Company's Articles
of Incorporation and By-Laws, each as amended, is a summary and is qualified in
its entirety by the provisions of the Articles of Incorporation and By-Laws as
currently in effect.
COMMON STOCK
Holders of Common Stock are entitled to one vote for each share held on
all matters submitted to a vote of shareholders, including the election of
directors. Accordingly, holders of a majority of the shares of Common Stock
entitled to vote in any election of directors may elect all of the directors
standing for election if
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<PAGE>
they choose to do so. The Articles of Incorporation does not provide for
cumulative voting for the election of directors. Holders of Common Stock will be
entitled to receive such dividends, if any, as may be declared from time to time
by the Board of Directors out of funds legally available therefor, and will be
entitled to receive, pro rata, all assets of the Company available for
distribution to such holders upon liquidation. Holders of Common Stock have no
preemptive, subscription or redemption rights.
PART II
ITEM 1. MARKET PRICE OF AND DIVIDENDS ON THE REGISTRANT'S COMMON EQUITY AND
OTHER SHAREHOLDER MATTERS
MARKET PRICE
The Company's Common Stock has been quoted on the Over The Counter
Bulletin Board since September 1997 under the symbol "FFCI". The following table
set forth, the high and low bid prices for the Common Stock for the quarters
indicated. The quotations represent bid between dealers and do not included
retail mark-up, mark-down or commissions, and do not represent actual
transactions.
HIGH BID LOW BID
Third Quarter 1998 9-1/8 4
Fourth Quarter l998 9-1/8 2
First Quarter 1999 5-7/8 2
Second Quarter 1999 15-5/8 4
At the date of this Registration Statement there were 840 holders of
record of 8,251,749 shares of Common Stock, including holders which maintain
their ownership in "Street Name."
DIVIDENDS
The Company anticipates that for the foreseeable future, earnings will
be retained for the development of is business. Accordingly, the Company does
not anticipate paying dividends on the Common Stock in the foreseeable future.
The payment of future dividends will be at the sole discretion of the Company's
Board of Directors and will depend upon other factors of the Company and general
business conditions.
ITEM 2. LEGAL PROCEEDINGS
To the best of the Company's knowledge, there is no threatened or
pending litigation. There are no law suits filed by holders of securities of
FFCI.
In an article dated March 8, 1999, it was reported that Mr. Bell
offered shares of the Company's stock to investors of his failed businesses
pursuant to a law suit. Mr. Bell was personally offering his own shares of FFCI
stock to individuals on a personal basis for equitable consideration (ie: 220
SMR license partnerships) which was not related to any securities litigation.
The article
17
<PAGE>
also stated that Mr. Bell was considering filing a defamation suit against the
parties who initiated the article; these were not only NOT investors but not
even stock holders or associated with FFCI in any way. Pursuant to both a
business and legal decision, Mr. Bell decided not to proceed with any further
litigation. The initial suit which was the basis for the original article was
dismissed by the Circuit Court of the 15th Judicial Circuit of Palm Beach, FL.
ITEM 3. CHANGES IN THE DISAGREEMENTS WITH ACCOUNTANTS
None
ITEM 4. RECENT SALES OF UNREGISTERED SECURITIES
a. Venture Capital USA
1. Issuance of 1,500,000 stock warrants in May 27, 1998 @ $1 ea.
b. Richard Bell and Christina Bell
1. Issuance of 3,735,526 shares in connection with the acquisition
of licenses and equipment from MacMillan Bell Group, Inc. in May
1998.
c. Nine separate partnerships referred to as the "Alliance"
1. Issuance of 333,132 shares in connection with the acquisition of
SMR licenses and equipment from various individual partnerships
Dec. 1998.
d. Ed and Sharon Pudliner
1. Issuance of 43,750 shares in connection with the acquisition of
Paradise International Connection, Inc. in Oct. 1998.
e. Brent Minor - 224,894 and Wallace Brazzeal - 225,600
1. Issuance of 350,000 shares in connection with the acquisition of
MB Broadcasting Inc. in Jan. 1999.
f. Chris Boutchie and Richard Bell
1. Issuance of 280,000 shares in connection with the acquisition of
the assets of Summit Advertising Group in March 1999.
g. Jeff Carpenter, Mark Stauffer, Nick Belnap, and Tracy Peek = 85,714
1. Issuance of stock in connection with the acquisition of
LanSource Inc. in June 1999. This sale was recinded and all
stock was returned to the company as discussed elsewhere in this
document.
h. American Wireless shareholders 1,200,000
1. Issuance of stock in connection with the acquisition of American
Wireless in May 1999.
ITEM 5. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Chapter 607 of the Florida Statutes provides for the indemnification of
officers and directors under certain circumstances against expenses incurred in
successfully defending against a claim and authorizes Florida corporations to
indemnify their officers and directors under certain circumstances against
expenses and liabilities incurred in legal proceedings involving such persons
because of their being or having been an officer or director.
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Section 607.0850 of the Florida Statutes permits a corporation, by so
providing in its certificate of incorporation, to eliminate or limit director's
liability to the corporation and its stockholders for monetary damages arising
out of certain alleged breaches of their fiduciary duty. Section 607,0850
provides that no such limitation of liability may affect a director's liability
with respect to any of the following: (i) breaches of the director's duty of
loyalty to the corporation or its stockholders; (ii) acts or omissions not made
in good faith or which involve intentional misconduct of knowing violations of
law; (iii) liability for dividends paid or stock repurchased or redeemed in
violation of the Florida General Corporation Law or (iv) any transaction from
which the director derived an improper personal benefit. Section 607 does not .
authorize any limitation on the ability of the corporation or its stockholders
to obtain injunctive relief, specific performance or other equitable relief
against directors.
Article IX of the Company's Articles of Incorporation and the Company's
By-laws provide that all persons who the Company is empowered to indemnify
pursuant to the provisions of Section 607 of the Corporation laws of the State
of Florida (or any similar provision or provisions of applicable law at the time
in effect), shall be indemnified by the Company to the full extent permitted
thereby. The foregoing right of indemnification is not deemed to be exclusive of
any other rights to which those seeking indemnification may be entitled under
any by-law, agreement, vote of stockholders or disinterested directors, or
otherwise.
Article IX of the Company's Articles of Incorporation provides that no
director of the Company will be personally liable to the Company or its
stockholders; provided by the full extent of the law with the exception of (i)
for any monetary damages for breaches of fiduciary duty of loyalty to the
Company or its stockholders; (ii) for acts or omissions not in good faith or
which involve intentional misconduct or a knowing violation of law; (iii) under
Section 607 of the Florida Statutes, or (iv) for any transaction from which the
director derived an improper personal benefit.
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Signatures
In accordance with Section 12 of the Securities and Exchange Act of
1934, the registrant caused this registration statement to be signed on its
behalf by the undersigned, "hereunto duly authorized.
Date: October 22, 1999
First Florida Communications, Inc.
By: /S/ DOUGLAS COSTA
--------------------------------
Douglas Costa, President & CEO
(Principal Executive Officer)
Pursuant to the requirements of the Securities Exchange act of 1934,
this registration statement has been signed below by the followings persons on
behalf of the registrant and in the capacities and on the dates indicated.
By: /S/ DOUGLAS COSTA
Date: October 22, 1999 ---------------------------------------------
Douglas Costa, President & CEO
By: /S/ PAUL RICHARD BELL
Date: October 22, 1999 ---------------------------------------------
Paul Richard Bell, Sr., Chairman
Of the Board of Directors
By: /S/ KENT WHITESEL
Date: October 22, 1999 ---------------------------------------------
Kent Whitesel, Chief Financial Officer
By: /S/ CHRISTINA LANDERS
Date: October 22, 1999 ---------------------------------------------
Christina Landers, Secretary/Treasurer.
20
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FIRST FLORIDA COMMUNICATIONS, INC.
(A DEVELOPMENT STAGE COMPANY)
TABLE OF CONTENTS
PAGE
Independent Auditor's Report 1
Financial Statements
Balance Sheet 2
Statements of Operations and Accumulated Deficit 3
Statements of Changes in Shareholders' Equity 4
Statements of Cash Flows 5
Notes to Financial Statements 6-10
21
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BAUM & COMPANY, P.A.
CERTIFIED PUBLIC ACCOUNTANTS
1515 UNIVERSITY DRIVE - SUITE 209
CORAL SPRINGS, FLORIDA 33071
(954) 752-1712
INDEPENDENT AUDITOR'S REPORT
To the Board of Directors and Stockholders of First Florida Communications, Inc.
We have audited the accompanying balance sheets of First Florida Communications
Inc. (A Development Stage Company) as of December 31, 1998 and the related
statements of income and accumulated deficit, stockholders equity and cash flows
for the years ended December 31, 1998, and 1997 and cumulative totals for
development stage operations from April 1, 1996 (date of inception) through
December 31, 1998. 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 audit.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about 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 audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of First Florida Communications,
Inc. (A Development Stage Company) as of December 31, 1998 and the results of
its operations and its cash flows for the years ended December 31, 1993 and 1997
and cumulative totals for development stage operations from April 1, 1996 (date
of inception) through December 31, 1998 in conformity with generally accepted
accounting principles.
The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As discussed in Note 9 of the
financial statements, the Company has suffered losses from operations has
nominal revenue stream, and has significant non-productive assets, which
substantial doubt about its ability to continue as a going concern. The
financial statements do not include any adjustment that might result from the
outcome of this uncertainty.
/s/ Baum & Company, P.A.
April 29, 1999
Coral Springs, Florida
1
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FIRST FLORIDA COMMUNICATIONS, INC.
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEET
DECEMBER 31, 1998
ASSETS
Crent Assets:
Cash and Cash Equivalents (Note l) $ 12,587
Inventory (Note 1) 7,859
Total Current Assets 20,439
Fixed Assets:
Property, Plant and Equipment (Notes 4 and 6)
(Net of accumulated depreciation of $3,852) 2,736,596
Other Current Assets:
Deposits 1,977
FCC Licenses (Note 7)
(Net of accumulated amortization of $29,418) 1,445,582
Total Other Current Assets 1,447,559
Total Assets $4,204,594
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts Payable & Accrued Expenses $ 368,707
Advances from stockholder (Note 8) 47,740
Total Current Liabilities 416,447
Total Liabilities 416,447
Shareholders' Equity:
Common Stock, $,0001 par value; 7,500,000
shares authorized; 4,313,610 shares issued
and outstanding 431
Additional Paid in Capital 4,826,403
Accumulated Deficit in the Development Stage (1,038,687)
Total Shareholders' Equity 3,788,147
Total Liabilities and Shareholders' Equity $4,204,594
See Accompanying Notes to the Financial Statements
2
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FIRST FLORIDA COMMUNICATIONS, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF OPERATIONS AND ACCUMULATED DEFICIT
FOR THE YEARS ENDED DECEMBER 31, 1937 AND 1998 AND
CUMULATIVE TOTALS FOR DEVELOPMENT STAGE OPERATIONS
FROM APRIL 1, 1996 (DATE OF INCEPTION) TO DECEMBER 31, 1998
<TABLE>
<CAPTION>
DEVELOPMENT STAGE
YEAR ENDED YEAR ENDED
DECEMEER 31, 1997 DECEMEER 31, 1998 DECEMBER 31, 1998
<S> <C> <C> <C>
Revenues:
Sales (Note 1) $ 45,161 $ 102,102 $ 147,261
Cost of Sales 31,265 96,662 127,927
Gross Profit 13,896 5,440 19,336
Operating Costs and Expenses
Selling, General &
Administrative 225,933 791,731 1,058,023
Net (Loss) Before Provision
For Income Taxes (212,037) (786,291) (1,038,687)
Provision For Income Taxes (Note 3) 0 0 0
Net (Loss) (212,037) (786,291) (1,038,687)
Accumulated Deficit - Beginning
of Year (40,359) (252,396)
Accumulated Deficit - End cf Year $ (252,396) $(1,038,687) $(1,038,6971
Income (alas) Per Common Share $ (2.70) $ (,62) $ (3.06)
Weighted Average
Common share Outstanding 93,429 1,666,186 339,092
</TABLE>
See Accompanying Notes to the Financial Statements
3
<PAGE>
FIRST FLORIDA COMMUNICATIONS, INC.
(A DEVELOPMENT STAGE COMPANY)
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
FOR THE YEARS ENDED DECEMBER 31, 1997 AND 1998
AND CUMULATIVE TOTALS FOR DEVELOPMENT STAGE OPERATIONS
FROM APRIL 1, 1996 (DATE OF INCEPTION) TO DECEMBER 31, 1998
<TABLE>
<CAPTION>
ACCUMULATED
COMMON STOCK ADDITIONAL DURING THE
------------------- PAID-IN DEVELOPMENT
SHARES AMOUNT CAPITAL STAGE
------ ------ ---------- ------------
<S> <C> <C> <C> <C>
December 31, 1996 81,273 $ 8 $ 240,912 $ (40,359)
Common Stock
Issued for Services 18,225 2 91,124
Net (Loss) For the Year (212,037)
December 31, 1997 99,504 10 332,036 (252,396)
Stock Retired (196,302) (20) 20
Stock Issued for Asset
Acquisition (Note 4) 4,112,408 411 4,194,377
Stock Warrant
Conversions (Note 5) 300,000 30 299,970
Net (Loss) For the Year (786,291)
December 31, 1998 4,313,610 $ 431 $ 4,826,403 $(1,038,687)
</TABLE>
See Accompanying Notes to the Financial Statements
4
<PAGE>
FIRST FLORIDA COMMUNICATIONS, INC.
(A DEVELOPMENT STAGE COMPANY)
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 1997 ANN 1998 AND
CUMULATIVE TOTALS FOR DEVELOPMENT STAGE OPERATIONS FROM
APRIL 1, 1996 (DATE OF INCEPTION) TO DECEMBER 31, 1998
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED DEVELOPMENT STAGE
DECEMBER 31, DECEMBER 31, APRIL 1, 1996 TO
1997 1998 DECEMBER 31, 1998
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIE'
Net Income (Loss) $ (212,037) $ (786,291) $(1,038,687)
Adjustments to Reconcile Net
Income (Loss) to Cash Used In
Operating Activities
Depreciation - 0 - 3,852 3,852
Amortization - 0 - 29,418 29,418
Common Stock Issued For Services 91,124 - 0 - 91,124
Changes in Working Capital:
Accounts Receivable 88,049 120,142 - 0 -
Accounts Payable 11,893 131,187 146,030
Advances Payable 20,749 18,251 47,740
---------- -------- ----------
Net Cash Provided (Used) in
Operating Activities (222) (483,441) (720,523)
CASH FLOWS (USED) IN INVESTING ACTIVITIES:
Acqusition of Fixtures &
Equipment (425) (4,986) (8,411)
Net Cash (Used) in Investing
Activities (425) (4,986) (8,411)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds of stock issued 240,921
Proceeds from acquisitions in
exchange for common stock -- 200,600 200,600
Stock Warrant Conversions -- 300,000 300,000
Net Cash Flows from Financing Activities - 0 - 500,600 741,521
NET INCREASE (DECREASE) IN CASH (647) 12,173 12,587
AND CASH EQUIVALENTS
CASH AND CASH EQUIVALENTS 1,061 414 -0-
BEGINNING OF YEAR
END OF YEAR $ 414 $ 12,587 $ 12,587
========== ======== ==========
CASH PAID FOR INTEREST EXPENSE - 0 - - 0 - - 0 -
CASH PAID FOR INCOME TAX - 0 - - 0 - - 0 -
</TABLE>
See Accompanying Notes To The Financial Statements
5
<PAGE>
FIRST FLORIDA COMMUNICATIONS, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1998
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
NATURE OF OPERATIONS
First Florida Communications, Inc., (the Company) was incorporated in
the State of Florida on April 1, 1996 to acquire FCC licenses,
broadcast rights, and provide services to sell equipment in the
wireless communication industry. (The Company is still in the
development stage). The majority of the company's assets are for the
"220 Megahertz" specialized mobile radio and paging business.
The accompanying financial statements reflect the application of
certain significant accounting policies as described below and
elsewhere in the accompanying financial statements and notes.
A. USE OF ESTIMATES
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and
liabilities and disclosures of contingent assets and liabilities at the
date of the financial statements and the reported amounts of revenues
and expenses during the period. Actual results can differ from those
estimates.
B. CASH AND CASH EQUIVALENTS
Cash and cash equivalents include cash on hand, cash in banks, and any
highly liquid investments with a maturity of three months or less at
the time of purchase.
The Company maintains cash and cash equivalent balances at several
financial institutions which are insured by the Federal Deposit
Insurance Corporation up to $100,000. At December 31, 1998 there is no
concentration of credit risk from uninsured bank balances.
C. INVENTORIES
Inventories (stated at the lower of cost of market) are primarily
cellular telephones, beepers, ancillary products and communication
parts.
D. DEPRECIATION
Furniture, fixtures and leasehold improvements are carried at cost.
Communications equipment, acquired for common stock, is carried at
estimated fair market value. Depreciation of property is provided for
based on estimated useful lives (generally 3 to 10 years) using
straight line methods.
6
<PAGE>
FIRST FLORIDA COMMUNICATIONS, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1998
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
E.) AMORTIZATION
The PCC licenses are being amortized over a twenty-year period
using the straight line method.
F.) EARNINGS (LOSS) PER SHARE
Primary earnings per common share are computed by dividing the net
income (loss) by the weighted average number of shares of common
stock and common stock equivalents outstanding during the year. The
number of shares used for the fiscal years ended December 31, 1998
and 1997 were 1,666,186 and 93,429, respectively. Common stock
equivalents were not used due to their delusive effects.
NOTE 2 - INCOME TAXES
In February 1992, the Financial Accounting Standards Board issued
Statement of Financial Standards 109 of "Accounting for Income
Taxes." Under FASB 109, deferred tax assets and liabilities are
recognized for the estimated future tax consequences attributable
to differences between the financial statement carrying amounts of
existing assets and liabilities and their respective tax bases. The
Company has net operating losses (NOL's) of approximately $1,00,000
expiring in the years 2011 through 2013.
Deferred tax benefit $ 318,000
Valuation allowance (318,000)
Net Benefit -0-
Due to the uncertainty of utilizing the NOL and recognizing the
deferred tax benefit an offsetting valuation allowance has been
provided.
NOTE 3 - LEASES
The Company leases office and retail store space under operating
lease agreements. The future minimum rental obligations of the
Company are as follows:
1999: $ 66,000
2000: $ 22,000
The Company has renewal options on these leases at their
discretion.
7
<PAGE>
FIRST FLORIDA COMMUNICATIONS, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1998
NOTE 3 - LEASES (CONTINUED)
As part of the acquisition of communications equipment, the Company
assumed approximately $206,000 of prior telecommunications tower
rent liabilities. As of December 31, signed or renewed any new
tower rental agreements. Due to the arrearages of tower rents, the
Company is at risk of seizure of their communications equipment
located at numerous locations. A reserve for contingent liabilities
related to the unpaid tower rents was accrued for $100,000 at
December 31, 1998.
The tower leases above are currently being renegotiated and revised
to reflect the change of ownership of the equipment on the site.
NOTE 4 - ACQUISITIONS
In January 1998 and May 1998, the Company acquired "220 Megahertz'
communication equipment and 41 FCC licenses, net of outstanding
liabilities, from the Macmillan Bell Group, Inc. for the issuance
of 3,735,526 restricted common shares. (Related party transaction).
In October 1998, the Company acquired from Nine (9) separate
partnerships (collectively referred to as '.The Alliance") 220
Megahertz communications equipment and FCC licenses, net of
liabilities, via the issuance of 333,132 common shares, at a
valuation of $1,080,000.
NOTE 5 - CAPITAL TRANSACTIONS
A.) On May 27, 1998, the Company issued 1,500,000 stock warrants which
expire on May 27, 2000 for the right to, purchase common stock at
$1.00 per share. No consideration was given for these warrants. As
of December 31, 1998, the warrant holder paid on behalf of the
Company $300,000 of operating expenses, thus received 300,000
shares of common stock.
B.) On May 4, 1998, the Company declared a 1:20 reverse stock split.
Accordingly, all share and per share data has been retroactively
restated.
8
<PAGE>
FIRST FLORIDA COMMUNICATIONS, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1998
NOTE 6 - FIXED ASSETS
Property, plant and equipment consists of:
Communications equipment $2,710,000
Furniture and fixtures 30,448
----------
2,740,448
Accumulated depreciation 3,852
----------
$2,736,596
NOTE 7 - FCC LICENSES
The Company owns fifty (50) FCC licenses, in 47 cities for "220
Megahertz" communications activities, that are renewable annually. The
$1,475,000 valuation of these licenses is being amortized over twenty
years. As of December 31, 1998 $29,418 has been amortized.
Possession to these licenses were acquired via various acquisitions as
noted in Note 4 and the Company is currently transferring the licenses
on the Federal Communications Commission's records into the name of the
Company.
NOTE 8 - RELATED PARTY TRANSACTIONS
The Company acquired Federal Communication licenses and "220 Megahertz"
communications equipment from the MacMillan Bell Group, Inc., (See Note
5). The sole stockholder of this corporation was a Director and former
Chief Executive Officer of the First Florida Communications, Inc., and
is the father of the principle shareholders of the Company.
This related party has advanced the Company $26,542 as of December 31,
1998. These advances are unsecured, non-interest bearing and has no
repayment scheduled.
NOTE 9 - GOING CONCERN CONSIDERATIONS
The Company has incurred losses from inception in excess of $1,000,000
and has never shown a profit. Due to the Company's nominal cash flow
and lack of Productive assets its ability to meet current obligations
is in doubt. Additionally, the negative working capital at December 31,
1998 of $396,000 raise substantial doubt as to its ability to continue
as a going concern. Management has advised us that a venture capital
company has expressed an interest of infusing equity capital into the
company and that new acquisitions will provide liquidity (Note 10) and
needed cash flow.
9
<PAGE>
FIRST FLORIDA COMMUNICATIONS, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1998
NOTE 10 - SUBSEQUENT EVENTS
In January 1999, the Company acquired all the stock of M. B.
Broadcasting, Inc., for 350,000 shares of common stock valued at $10
per share for a purchase of $3,500,000. M. B. Broadcasting, Inc., is
primarily a Saint George, Utah cable television station and T.V.
production company.
In March 1999, the Company acquired for $1,500,000 the net assets of
Summit Advertising Group, a Fort Lauderdale, Florida advertising
agency. The purchase price consideration was $100,000 in cash and
280,000 shares of restricted common stock.
10
PART III
ITEM 2. INDEX TO EXHIBITS.
EXHIBIT NO. DESCRIPTION OF DOCUMENT
- --------------------------------------------------------------------------------
3.1 Form of Amended and Restated Articles of Incorporation
3.2 By-Laws, as amended [3-6]
4.1 Form of Common Stock Certificates
4.2 Acquisition Agreements
A. Corporate Resolutions
B. MB Broadcasting (Sample of Stock Purchase 1 of 7)
C. Catalog Channel, Inc.
D. Summit Advertising Group, Inc.
E. Alliance (Sample of Agreements with 1 if 9 separate and
individual 220 SMR partnerships)
F. American Wireless (Sample of Stock Purchase Agreement 1 of 35)
G. Paradise International Connections, Inc.
H. LanSource, Inc. (Sample of Stock Purchase Agreement 1 of 4)
4.3 Jones Space Holdings Transponder Agreement
4.4 Video Catalog Agreement
4.5 LanSource Recision Agreement
4.6 Tiger eye Contract
4.7 Tiger eye Station Affidavits (airing times and dates)
4.8 Motorola Agreement
5.1 Paul Richard Bell CFTC litigation explanation
6.1 Paradise International Connection, Inc. Financials
<PAGE>
INDEX TO EXHIBITS.
EXHIBIT NO. DESCRIPTION OF DOCUMENT
- ---------- -----------------------
3.1 Form of Amended and Restated Articles of Incorporation
3.2 By-Laws, as amended [3-6]
4.1 Form of Common Stock Certificates
4.2 Acquisition Agreements
A. Corporate Resolutions
B. MB Broadcasting (Sample of Stock Purchase 1 of 7)
C. Catalog Channel, Inc.
D. Summit Advertising Group, Inc.
E. Alliance (Sample of Agreements with 1 if 9 separate and
individual 220 SMR partnerships)
F. American Wireless (Sample of Stock Purchase
Agreement 1 of 35)
G. Paradise International Connections, Inc.
H. LanSource, Inc. (Sample of Stock Purchase Agreement 1 of 4)
4.3 Jones Space Holdings Transponder Agreement
4.4 Video Catalog Agreement
4.5 LanSource Recision Agreement
4.6 Tiger eye Contract
4.7 Tiger eye Station Affidavits (airing times and dates)
4.8 Motorola Agreement
5.1 Paul Richard Bell CFTC litigation explanation
6.1 Paradise International Connection, Inc. Financials
EXHIBIT 3.1
EX- 3.1
Florida Department of State
Katherine Harris
Secretary of State
February 17, 1999
RICHARD P. GREENE, P.A.
2455 E. SUNRISE BLVD., STE. 905
FT. LAUDERDALE, FL 33304
Re: Document Number P96000030104
The Articles of Amendment to the Articles of Incorporation of FIRST FLORIDA
COMMUNICATIONS, INC., a Florida corporation, were file on December 21, 1998.
Should you have any questions regarding this matter, please telephone (850)
437-6050, the Amendment Filing Section.
Thelma Lewis
Corporate Specialist Supervisor
Division of Corporations
Letter Number: l99A00000916
Division of Corporations - P.O. BOX 6327 - Tallahassee, Florida 32314
<PAGE>
ARTICLES OF AMENDMENT
TO THE
ARTICLES OF INCORPORATION
OF
FIRST FLORIDA COMMUNICATIONS, INC.
The Articles of Incorporation of the above-named corporation (the
"Corporation"), filed with the Department of State on the 1st day of April, 1996
and assigned Document Number P960000301104, are hereby amended pursuant to a
written consent in lieu of meeting executed and approved by all of the
Corporation's Directors on the 14 day of DECEMBER, 1998, as follows:
ITEM 1
1. ARTICLE IV - CAPITAL STOCK is hereby amended to read as follows:
ARTICLE IV
CAPITAL STOCK
This Corporation is authorized to issue 20,000,000 shares of
$.0001 par value common stock.
This Articles of Amendment to the Articles of Incorporation was
adopted by the Directors on the 14 day of DECEMBER , 1998. Shareholder approval
was not required.
IN WITNESS WHEREOF, the undersigned has executed these Articles of
Amendment to the Articles of Incorporation this 14 day of DECEMBER , 1998.
By: /S/ PAUL RICHARD BELL
---------------------------
Paul Richard Bell, Director
<PAGE>
Florida Department of State
Sandra B. Mortham
Secretary of State
May 21, 1998
CAPITOL CONNECTION, INC.
TALLAHASSEE, FL
SUBJECT: FIRST FLORIDA COMMUNICATIONS, INC.
Ref. Number: P96000030104
We have received your document for FIRST FLORIDA COMMUNICATIONS, INC., and
check(s) totaling $87.50. However, the enclosed document has not been filed and
is being returned to you for the following reason(s):
The document must have original signatures.
Please return your document, along with a copy of this letter, within 60 days or
your filing will be considered abandoned.
If you have any questions concerning the filing of your document, please call
(850) 487-6903.
Cheryl Coulliette
Document Specialist
Letter Number: 298A00028617
RECEIVED
98 MAY 22 AM 10:51
DIVISION OF CORPORATIONS
"Corrected"
Division of Corporations - P.O. BOX 6327 - Tallahassee, Florida 32314
<PAGE>
ARTICLES OF AMENDMENT
TO THE
ARTICLES OF INCORPORATION
OF
FIRST FLORIDA COMMUNICATIONS, INC.
1. ARTICLE FIFTH of the Articles of Incorporation of the Corporation is
hereby amended to read as follows:
FIFTH:
This Corporation is authorized to issue SEVEN MILLION FIVE
HUNDRED THOUSAND (7,500,000) shares of Common Stock, having a par
value of $.001 per share, which shall be designated "common
Stock".
All issued and outstanding shares of Common Stock of the
Corporation held by each holder of record on May 4, 1998, shall
be automatically combined at a rate of one for twenty (1:20).
This reverse stock split shall not affect the par value of the
Common Stock or the authorized number of shares of Common Stock.
No fractional share or scrip representing a fractional share
shall be issued upon the Reverse Stock Split. Fractional shares
of .5 of Common Stock, will be rounded up to the next highest
share, and fractional interest of less than .5 of Common Stock
will be reduced down to the next nearest share. Any stockholder
whose aggregate stockholding is reduced to a fraction of one (1)
share will receive one (1) share of New Common Stock.
2. The foregoing amendment was adopted on May 4, 1998 by the majority of
the Shareholders of the Corporation. The number of votes cast for the
amendment was sufficient for approval on May 4, 1998.
IN WITNESS WHEREOF, the undersigned President has executed these
Articles of Amendment of the 20 day of May, 1998.
/S/ PAUL R. BELL
---------------------------------
Paul Richard Bell, Jr., President
<PAGE>
FLORIDA DEPARTMENT OF STATE
Sandra B. Mortham
Secretary of State
April 5, 1996
RICHARD P. GREENE
2455 E. SUNRISE BLVD., STE. 905
FT. LAUDERDALE, FL 33304
The Articles of Incorporation for FIRST FLORIDA COMMUNICATIONS, INC. Were filed
on April 1, 1996 and assigned document number P96000030104. Please refer to this
number whenever corresponding with this office regarding the above corporation.
PLEASE NOTE: COMPLIANCE WITH THE FOLLOWING PROCEDURES IS ESSENTIAL TO
MAINTAINING YOUR CORPORATE STATUS, FAILURE TO DO SO MAY RESULT IN DISSOLUTION OF
YOUR CORPORATION,
A CORPORATION ANNUAL REPORT MUST BE FILED WITH THIS OFFICE BETWEEN JANUARY l AND
MAY 1 OF EACH YEAR BEGINNING WITH THE CALENDAR YEAR FOLLOWING THE YEAR OF THE
FILING DATE NOTED ABOVE AND EACH YEAR THEREAFTER. FAILURE TO FILE THE ANNUAL
REPORT ON TIME MAY RESULT IN ADMINISTRATIVE DISSOLUTION OF YOUR CORPORATION.
A FEDERAL EMPLOYER IDENTIFICATION (FEI) NUMBER MUST BE SHOWN ON THE ANNUAL
REPORT FORM PRIOR TO ITS FILING WITH THIS OFFICE. CONTACT THE INTERNAL REVENUE
SERVICE TO INSURE THAT YOU RECEIVE THE FEI NUMBER IN TIME TO FILE THE ANNUAL
REPORT. TO OBTAIN A FEI NUMBER, CONTACT THE IRS AT 1-800-829-3676 AND REQUEST
FORM SS-4,
SHOULD YOUR CORPORATE MAILING ADDRESS CHANGE, YOU MUST NOTIFY THIS OFFICE IN
WRITING, TO INSURE IMPORTANT MAILINGS SUCH AS THE ANNUAL REPORT NOTICES REACH
YOU.
Should you have any questions regarding corporations, please contact this office
at the address given below.
Sandy Ng, Document Specialist
New Filings Section
Letter Number: 996A00015767
Division of Corporations - P.O. BOX 6327 - Tallahassee, Florida 32314
<PAGE>
ARTICLES OF INCORPORATION
OF
FIRST FLORIDA COMMUNICATIONS, INC.
THE UNDERSIGNED, for the purpose of forming a corporation for profit
pursuant to Chapter 607, Florida Statutes, does hereby adopt the following
Articles of Incorporation:
WITNESSETH:
ARTICLES I
NAME AND ADDRESS
The name and address of the principal office and/or mailing address
of the Corporation is as follows:
FIRST FLORIDA COMMUNICATIONS, INC.
5625 SOUTH UNIVERSITY DRIVE
DAVIE, FLORIDA 33328
ARTICLE II
DURATION
This Corporation shall have perpetual existence commencing on the
date of the filing of these Articles of Incorporation with the Department of
State of Florida.
ARTICLE III
PURPOSES
This Corporation is organized for the purpose of transacting any and
all lawful business.
ARTICLES IV
CAPITAL STOCK
This Corporation is authorized to issue 7,500,000 shares of $.0001
par value common stock.
Prepared by:
Richard P. Greene, P.A.
Richard P. Greene, Esquire
2455 East Sunrise Boulevard, Suite 905
Fort Lauderdale, Florida 33304
(954) 564-6616
Florida Bar Number: 504373
<PAGE>
ARTICLE V
QUORUM FOR STOCKHOLDERS MEETINGS
Unless otherwise provided for in the Corporation's Bylaws, a majority
of the shares entitled to vote, represented in person or by proxy, shall be
required to constitute a quorum at a meeting of shareholders.
ARTICLE VI
INITIAL REGISTERED OFFICE AND REGISTERED AGENT
The street address of the initial registered office of this
Corporation is 2455 East Sunrise Boulevard, Suite 305, Fort Lauderdale, Florida
33304 and the name of the initial registered agent of this Corporation at such
address is Richard P. Greene, P.A.
ARTICLES VII
INITIAL BOARD OF DIRECTORS
This Corporation shall have one director initially. The number of
directors may be either increased or diminished from time to time in the manner
provided in the Bylaws, but shall never be less than one. The name and address
of the initial Director of the Corporation is as follows:
Paul Richard Bell, Jr.
5625 South University Drive
Davie, Florida 33323
ARTICLE VIII
INCORPORATORS
The name and address of the Corporation's incorporator is:
Richard P. Greene
2455 East Sunrise Boulevard, Suite 905
Fort Lauderdale, Florida 33304
ARTICLE IX
INDEMNIFICATION
The Corporation shall indemnify its officers, directors and
authorized agents for all liabilities incurred directly, indirectly or
incidentally to services performed for the Corporation, to the fullest extent
permitted under Florida law existing now or hereinafter enacted.
<PAGE>
ARTICLE X
LIMITATION ON SHAREHOLDER SUITS
Shareholders shall not have a cause of action against the Company's
officers, directors or agents as a result of any action taken, or as a result of
their failure to take any action, unless deprivation of such right is deemed a
nullity because, in the specific case, deprivation of a right of action would be
impermissible in conflict with the public policy of the State of Florida. The
fact that this Article shall be inapplicable in certain circumstances shall not
render it inapplicable in any other circumstances and the Courts of the State of
Florida are hereby granted the specific authority to restructure this Article,
on a case by case basis or generally, as required to most fully give legal
effect to its intent.
IN WITNESS WHEREOF, we have subscribed our names this _ day of March,
1996.
/S/ RICHARD P. GREENE
---------------------------------
Richard P. Greene, Incorporator
2455 East Sunrise Boulevard, Suite 905
Ft. Lauderdale, Florida 33304
I hereby am familiar with and accept the duties and responsibilities
as registered agent for said corporation.
RICHARD P. GREENE, P.A.
By: /S/ RICHARD P. GREENE
- ----------------------------------
Richard P. Greene, Esq., President
EXHIBIT 3.2
EX - 3.2
BYLAWS
OF
FIRST FLORIDA COMMUNICATIONS, INC.
ARTICLE I
SHAREHOLDERS
SECTION 1. ANNUAL MEETINGS
(a) The annual meeting of the shareholders of the Corporation, shall
be held at the principal office of the Corporation in the State of Florida or at
such other place within or without the State of Florida as may be determined by
the Board of Directors and as may be designated in the notice of such meeting.
The meeting shall be held on the third Tuesday of February of each year or on
such other day as the Board of Directors may specify. If said day is a legal
holiday, the meeting shall be held on the next succeeding business day not a
legal holiday.
(b) Business to be transacted at such meeting shall be the election
of directors to succeed those whose terms are expiring and such other business
as may be properly brought before the meeting.
(c) In the event that the annual meeting, by mistake or otherwise,
shall not be called and held as herein provided, a special meeting may be called
as provided for in Section 2 of this Article I in lieu of and for the purposes
of and with the same effect as the annual meeting.
SECTION 2. SPECIAL MEETINGS
(a) A special meeting of the shareholders of the Corporation may be
called for any purpose or purposes at any time by the President of the
Corporation, by the Board of Directors or by the holders of not less than 10% of
the outstanding capital stock of the Corporation entitled to vote at such
meeting.
(b) At any time, upon the written direction of any person or persons
entitled to call a special meeting of the shareholders, it shall be the duty of
the Secretary to send notice of such meeting pursuant to Section 4 of this
Article I. It shall be the responsibility of the person or persons directing the
Secretary to send notice of any special meeting of shareholders to deliver such
direction and a proposed form of notice to the Secretary not less than 15 days
prior to the proposed date of said meeting.
(c) Special meetings of the shareholders of the Corporation shall be
held at such place, within or without the State of Florida, on such date, and at
such time as shall be specified in the notice of such special meeting.
1
<PAGE>
SECTION 3. ADJOURNMENT
(a) When the annual meeting is convened, or when any special meeting
is convened, the presiding officer may adjourn it for such period of time as may
be reasonably necessary to reconvene the meeting at another place and time.
(b) The presiding officer shall have the power to adjourn any meeting
of the Shareholders for any proper purpose, including, but not limited to, lack
of a quorum, securing a more adequate meeting place, electing officials to count
and tabulate votes, reviewing any shareholder proposals or passing upon any
challenge which may properly come before the meetings.
(c) When a meeting is adjourned to another time or place, it shall
not be necessary to give any notice of the adjourned meeting if the time and
place to which the meeting is adjourned are announced at the meeting at which
the adjournment is taken, and any business may be transacted at the adjourned
meeting that might have been transacted on the original date of the meeting. If,
however, after the adjournment the Board fixes a new record date for the
adjourned meeting, a notice of the adjourned meeting shall be given in
compliance with Section 4(a) OF this Article I to each shareholder OF record on
the new record date entitled to vote at such meeting.
SECTION 4. NOTICE OF MEETINGS, PURPOSE OF MEETING, WAIVER
(a) Each shareholder of record entitled to vote at any meeting shall
be given in person, or by first class mail, postage prepaid, written notice of
such meeting which, in the case of a special meeting, shall set forth the
purpose(s) for which the meeting is called, not less than 10 or more than 60
days before the date of such meeting. If mailed, such notice is to be sent to
the shareholder Is address as it appears on the stock transfer books of the
Corporation, unless the shareholder shall be requested of the Secretary in
writing at least 15 days prior to the distribution of any required notice that
any notice intended for him or her be sent to some other address, in which case
the notice may be sent to the address so designated. Notwithstanding any such
request by a shareholder, notice sent to a shareholder's address as it appears
on the stock transfer books of this Corporation as of the record date shall be
deemed properly given. Any notice of a meeting sent by United States mail shall
be deemed delivered when deposited with proper postage thereon with the United
States Postal Service or in any mail receptacle under its control.
(b) A shareholder waives notice of any meeting by attendance, either
in person or by proxy, at such meeting or by waiving notice in writing either
before, during or after such meeting. Attendance at a meeting for the express
purpose of objecting that the meeting was not lawfully called or convened,
however, will not constitute a waiver of notice by a shareholder who states at
the beginning of the meeting, his or her objection that the meeting is not
lawfully called or convened.
(c) A waiver of notice signed by all shareholders entitled to vote at
a meeting of shareholders may also be used for any other proper purpose
including, but not limited to, designating any place within or without the State
of Florida as the place for holding such a meeting.
2
<PAGE>
(d) Neither the business to be transacted at, nor the purpose of, any regular or
special meeting of shareholders need be specified in any written waiver of
notice.
SECTION 5. CLOSING OF TRANSFER BOOKS, RECORD DATE, SHAREHOLDERS' LIST
(a) In order to determine the holders of record of the capital stock
of the Corporation who are entitled to notice of meetings, to vote a meeting or
adjournment thereof, or to receive payment of any dividend, or for any other
purpose, the Board of Directors may fix a date not more than 60 days prior to
the date set for any of the above-mentioned activities for such determination of
shareholders.
(b) If the stock transfer books shall be closed for the purpose of
determining shareholders entitled to notice of or to vote at a meeting of
shareholders, such books shall be closed for at least l0 days immediately
preceding such meeting.
(c) In lieu of closing the stock transfer books, the Board of
Directors may fix in advance a date as the date for any such determination of
shareholders, such date in any case to be not more than 60 days prior to the
date on which the particular action, requiring such determination of
shareholders, is to be taken.
(d) If the stock transfer books are not closed and no record date is
fixed for the determination of shareholders entitled to notice or to vote at a
meeting of shareholders, or to receive payment of a dividend, the date on which
notice of the meeting is mailed or the date on which the resolution of the Board
of Directors declaring such dividend is adopted, as the case may be, shall be
the record date for such determination of shareholders.
(e) When a determination of shareholders entitled to vote at any
meeting of shareholders has been made as provided in this Section, such
determination shall apply to any adjournment thereof, unless the Board of
Directors fixes a new record date under this Section for the adjourned meeting.
(f) The officer or agent having charge of the stock transfer books of
the Corporation shall make, as of a date at least l0 days before each meeting of
shareholders, a complete list of the shareholders entitled to vote at such
meeting or any adjournment thereof, with the address of each shareholder and the
number and class and series, if any, of shares held by each shareholder. Such
list shall be kept on file at the registered office of the Corporation, at the
principal place of business of the Corporation or at the office of the transfer
agent or registrar of the Corporation for a period of l0 days prior to such
meeting and shall be available for inspection by any shareholder at any time
during usual business hours. Such list shall also be produced and kept open at
the time and place of any meeting of shareholders and shall be subject to
inspection by any shareholder at any time during the meeting.
(g) The original stock transfer books shall be prima facie evidence
as to the shareholders entitled to examine such list or stock transfer books or
to vote any meeting of shareholders.
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(h) If the requirements of Section 5(f) of this Article I have not
been substantially complied with, then, on the demand of any shareholder in
person or by proxy, the meeting shall be adjourned until such requirements are
complied with.
(i) If no demand pursuant to Section 5(h) of this Article I is made,
failure to comply with the requirements of this Section shall not affect the
validity of any action taken at such meeting.
(j) Section 5(g) of this Article I shall be operative only at such
time(s) as the Corporation shall have 6 or more shareholders.
SECTION 6. QUORUM
At any meeting of the shareholders of the Corporation, the presence,
in person or by proxy, of shareholders owning a majority of the issued and
outstanding shares of the capital stock of the Corporation entitled to vote
thereat shall be necessary to constitute a quorum for the transaction of any
business. If a quorum is present, the vote of a majority of the shares
represented at such meeting and entitled to vote on the subject matter shall be
the act of the shareholders. If there shall not be quorum at any meeting of the
shareholders of the Corporation, then the holders of a majority of the shares of
the capital stock of the Corporation who shall be present at such meeting, in
person or by proxy, may adjourn such meeting from time to time until holders of
all of the shares of the capital stock shall attend. At any such adjourned
meeting at which a quorum shall be present, any business may be transacted which
might have been transacted at the meeting as originally scheduled.
SECTION 7. PRESIDING OFFICER, ORDER OF BUSINESS
(a) Meetings of the shareholders shall be presided over by the
Chairman of the Board, or, if he or she is not present or there is no Chairman
of the Board, by the President or, if he or she is not present, by the senior
Vice President present or, if neither the Chairman of the Board, the President,
nor a Vice President is present, the meeting shall be presided over by a
chairman to be chosen by a plurality of the shareholders entitled to vote at the
meeting who are present, in person or by proxy. The presiding officer of any
meeting of the shareholders may delegate his or her duties and obligations as
the presiding officer as he or she sees fit.
(b) The Secretary of the Corporation, or, in his or her absence, an
Assistant Secretary shall act as Secretary of every meeting of shareholders, but
if neither the Secretary nor an Assistant Secretary is present, the presiding
officer of the meeting shall choose any person present to act as secretary of
the meeting.
(c) The order of business shall be as follows:
1. Call of meeting to order,
2. Proof of notice of meeting.
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3. Read minutes of last shareholders' meeting
or a waiver thereof
4. Reports of officers.
5. Reports of committees.
6. Election of directors.
7. Regular and miscellaneous business.
8. Special matters.
9. Adjournment.
(d) Notwithstanding the provisions of Section 7(c) of this Article I,
the order and topics of business to be transacted at any meeting shall be
determined by the presiding officer of the meeting in his or her sole
discretion. In no event shall any variation in the order of business or
additions and deletions from the order of business as specified in Section 7(c)
of this Article I invalidate any actions properly taken at any meeting.
SECTION 8. VOTING
(a) Unless otherwise provided for in the Articles of Incorporation,
each shareholder shall be entitled, at each meeting and upon each proposal to be
voted upon, to one vote for each share of voting stock recorded in his name on
the books of the Corporation on the record date fixed as provided for in Section
5 of this Article I.
(b) The presiding officer at any meeting of the shareholders shall
have the power to determine the method and means of voting when any matter is to
be voted upon. The method and means of voting may include, but shall not be
limited to, vote by ballot, vote by hand or vote by voice. No method of voting
may be adopted, however, which fails to take account of any shareholder's right
to vote by proxy as provided for in Section 10 of this Article I. In no event
may nay method of voting be adopted which would prejudice the outcome of the
vote.
SECTION 9. ACTION WITHOUT MEETING
(a) Any action required to be taken at any annual or special meeting
of shareholders of the Corporation, or any action which may be taken at any
annual or special meeting of such shareholders, may be taken without a meeting,
without prior notice and without a vote, if a consent in writing, setting forth
the action so taken, shall be signed by the holders of a majority of the
Corporations outstanding stock.
(b) In the event that the action to which the shareholders consent is
such as would have required the filing of a certificate under the Florida
General Corporation Act is such action had been voted on by shareholders at a
meeting thereof, the certificate filed under such other section shall state that
written consent has been given in accordance with the provisions of Section 9 of
this Article I.
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(c) If shareholder action is taken by written consent in lieu of
meeting signed by less than all of the Corporation's shareholders, then all non
participating shareholders shall be provided with written notice of the action
taken within 10 days after the date of written instrument taking such action.
(d) No action by written consent in lieu of meeting shall be valid if
it is in contravention of applicable proxy or informational rules adopted
pursuant to the Securities Exchange Act of 1934, as amended, including, without
limitation, the requirements of Section 14 thereof.
SECTION 10. PROXIES
(a) Every shareholder entitled to vote at a meeting of shareholders
or to express consent or dissent without a meeting, or his or her duly
authorized attorney-in-fact, may authorize another person or persons to act for
him or her by proxy.
(b) Every proxy must be signed by the shareholder or his or her
attorney-in-fact. No proxy shall be valid after the expiration of 11 months from
the date thereof unless otherwise provided in the proxy. Every proxy shall be
revocable at the pleasure of the shareholder executing it, except as otherwise
provided in this Section 10.
(c) The authority of the holder of a proxy to act shall not be
revoked by the incompetence or death of the shareholder who executed the proxy
unless, before the authority is exercised, written notice of any adjudication of
such incompetence or of such death is received by the corporate officer
responsible for maintaining the list of shareholders.
(d) Except when other provisions shall have been made by written
agreement between the parties, the record holder of shares held as pledges or
otherwise as security or which belong to another, shall issue to the pledger or
to such owner of such shares, upon demand therefor and payment of necessary
expenses thereof, a proxy to vote or take other action thereon.
(e) A proxy which states that it is irrevocable is irrevocable when
it is held by any of the following or a nominee of any of the following: (i) a
pledges; (ii) a person who has purchased or agreed to purchase the shares: (iii)
a creditor or creditors of the Corporation who extend or continue to extend
credit to the Corporation in consideration of the proxy, if the proxy states
that it was given in consideration of such extension or continuation of credit,
the amount thereof, and the name of the person extending or continuing credit;
(iv) a person who has contracted to perform services as an officer of the
Corporation, if a proxy is required by the contract of employment, if the proxy
states that it was given in consideration of such contract of employment and
states the name of the employee and the period of employment contracted for; and
(v) a person designated by or under an agreement as provided in Article XI
hereof.
(f) Notwithstanding a provision in a proxy stating that it is
irrevocable, the proxy becomes revocable after the pledge is redeemed, the debt
of the Corporation is paid, the period of
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employment provided for in the contract of employment has terminated, or the
agreement under Article XI hereof has terminated and, in a case provided for in
Section 10(e) (iii) or Section 10(e) (iv) of this Article I, becomes revocable
three years after the date of the proxy or at the end of the period, if any,
specified therein, whichever period is less, unless the period of irrevocability
of the proxy as provided in this Section 10. This Section 10(f) does not affect
the duration of a proxy under Section 10(b) of this Article I.
(g) A proxy may be revoked, notwithstanding a provision making it
irrevocable, by a purchaser of shares without knowledge of the existence of the
provisions unless the existence of the proxy and its irrevocability is noted
conspicuously on the face or back of the certificate representing such shares.
(h) If a proxy for the same shares confers authority upon two or more
persons and does not otherwise provide, a majority of such persons present at
the meeting, or if only one is present then that one, may exercise all the
powers conferred by the proxy. if the proxy holders present at the meeting are
equally divided as to the right and manner of voting in any particular case, the
voting of such shares shall be prorated.
(i) If a proxy expressly so provides, any proxy holder may appoint in
writing a substitute to act in his or her place.
(j) Notwithstanding anything in the Bylaws to the contrary, no proxy
shall be valid if it was obtained in violation of any applicable requirements of
Section 14 of the Securities Exchange Act of 1934, as amended, or the Rules and
Regulations promulgated thereunder.
SECTION 11. VOTING OF SHARES BY SHAREHOLDERS
(a) Shares standing in the name of another corporation, domestic or
foreign, may be voted by the officer, agent, or proxy designated by the bylaws
of the corporate shareholder; or, in the absence of any applicable bylaw, by
such person as the board of directors of the corporate shareholder may
designate. Proof of such designation may be made by presentation of a certified
copy of the bylaws or other instrument of the corporate shareholder. In the
absence of any such designation, or in case of conflicting designation by the
corporate shareholder, the chairman of the board, president, any vice president,
secretary and treasurer of the corporate shareholder, in that order, shall be
presumed to possess authority to vote such shares.
(b) Shares held by an administrator, executor, guardian or
conservator may be voted by him or her, either in person or by proxy, without a
transfer of such shares into his or her name. Shares standing in the name of a
trustee may be voted as shares held by him or her without a transfer of such
shares into his name.
(c) Shares standing in the name of a receiver may be voted by such
receiver. Shares held by or under the control of a receiver but not standing in
the name of such receiver, may be voted by
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such receiver without the transfer thereof into his name if authority to do so
is contained in an appropriate order of the court by which such receiver was
appointed.
(d) A shareholder whose shares are pledged shall be entitled to vote
such shares until the shares have been transferred into the name of the pledges.
(e) Shares of the capital stock of the Corporation belonging to the
Corporation or held by it in a fiduciary capacity shall not be voted, directly
or indirectly, at any meeting, and shall not be counted in determining the total
number of outstanding shares.
ARTICLE II
DIRECTORS
SECTION 1. BOARD OF DIRECTORS, EXERCISE OF CORPORATE POWERS
(a) All corporate powers shall be exercised by or under the authority
of, and the business and affairs of the Corporation shall be managed under the
direction of, the Board of Directors except as may be otherwise provided in the
Articles of Incorporation or in Shareholder Is Agreement. If any such provision
is made in the Articles of Incorporation or in Shareholder's Agreement, the
powers and duties conferred or imposed upon the Board of Directors shall be
exercised or performed to such extent and by such person or persons as shall be
provided in the Articles of Incorporation or Shareholders' Agreement.
(b) Directors need not be residents of this state or shareholders of
the Corporation unless the Articles of Incorporation so require,
(c) The Board of Directors shall have authority to fix the
compensation of directors unless otherwise provided in the Articles of
Incorporation.
(d) A director shall perform his or her duties as a director,
including his or her duties as a member of any committee of the Board upon which
he may serve, in good faith, in a manner he or she reasonably believes to be in
the best interests of the Corporation, and with such care as an ordinarily
prudent person in a like position would use under similar circumstances.
(e) In performing his or her duties, a director shall be entitled to
rely on information, opinions, reports or statements, including financial
statements and other financial data, in each case prepared or presented by: (i)
one or more officers or employees of the Corporation whom the director
reasonably believes to be reliable and competent in the matters presented; (ii)
legal counsel, public accountants or other persons as to matters which the
director reasonably believes to be within such persons' professional or expert
competence; or (iii) a committee of the Board upon which he or she does not
serve, duly designated in accordance with a provision of the Articles of
Incorporation
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or these By-Laws, as to matters within its designated authority, which committee
the director reasonably believes to merit confidence.
(f) A director shall not be considered to be acting in good faith if
he or she has knowledge concerning the matter in question that would cause such
reliance described in Section l(e) of this Article II to be unwarranted.
(g) A person who performs his or her duties in compliance with
Section l of this Article II shall have no liability by reason of being or
having been a director of the Corporation.
(h) A director of the Corporation who is present at a meeting of the
Board of Directors at which action on any corporate matter is taken shall be
presumed to have assented to the action taken unless he or she votes against
such action or abstains from voting in respect thereto because of an asserted
conflict of interest.
SECTION 2. NUMBER, ELECTION, CLASSIFICATION OF DIRECTORS, VACANCIES
(a) The Board of Directors of this Corporation shall consist of not
less than one director. The Board shall have authority, from time to time, to
increase the number of directors or to decrease it to not less than one member,
provided that no decrease in the number of directors shall deprive a serving
director of the right to serve throughout the term of his or her election.
(b) Each person named in the Articles of Incorporation as a member of
the initial Board of Directors shall serve until his or her successor shall have
been elected and qualified or until his or her earlier resignation, removal from
office, or death.
(c) At the first annual meeting of shareholders and at each annual
meeting thereafter, the shareholders shall elect directors to hold office until
the next succeeding annual meeting, except in case of the classification of
director as permitted by the Florida General Corporation Act. Each Director
shall hold office for the term for which he or she is elected and until his or
her successor shall have been elected and qualified or until his or her earlier
resignation, removal from office, or death.
(d) The shareholders, by amendment to these Bylaws, may provide that
the directors be divided into not more than four classes, as nearly equal in
number as possible, whose terms of office shall respectively expire at different
times, but no such term shall continue longer than four years, and at least one
fourth of the directors shall be elected annually. If Directors are classified
and the number of directors is thereafter changed, any increase or decrease in
directorship shall be so apportioned among the classes as to make all classes as
nearly equal in number as possible.
(e) Any vacancy occurring in the Board of Directors, including any
vacancy created by reason of an increase in the number of directors, may be
filled only by the Board of Directors. A director elected to fill a vacancy
shall hold office only until the next election of directors by the shareholders.
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SECTION 3. REMOVAL OF DIRECTORS
At a meeting of shareholders called expressly for that purpose,
directors may be removed in the manner provided in this Section 3. Any director
or the entire Board of Directors may be removed, with or without cause, by the
vote of the holders of two-thirds of the shares then entitled to vote at an
election of directors.
SECTION 4. DIRECTOR QUORUM AND VOTING
(a) A majority of the directors fixed in the manner provided in these
Bylaws shall constitute a quorum for the transaction of business.
(b) A majority of the members of an Executive Committee or other
committee shall constitute a quorum for the transaction of business at any
meeting of such Executive Committee or other committee.
(c) The act of a majority of the directors present at a Board meeting
at which a quorum is present shall be the act of the Board of Directors.
(d) The act of a majority of the members of an Executive Committee
present at an Executive Committee meeting at which a quorum is present shall be
the act of the Executive Committee.
(e) The act of a majority of the members of any other committee
present at a committee meeting at which a quorum is present shall be the act of
the committee.
(f) Directors may, if not contrary to applicable law, vote either in
person or by proxy, provided that the proxy holder must be either another
director, an officer or a shareholder of the Corporation, however, any director
who elects to vote by proxy more than three times during any single fiscal year
shall, unless otherwise determined by the Board of Directors, be automatically
removed as a director.
SECTION 5. DIRECTOR CONFLICTS OF INTEREST
(a) No contract or other transaction between this Corporation and one
or more of its director or any other corporation, firm, association or entity in
which one or more of its directors are Directors or officers or are financially
interested shall be either void or voidable because of such relationship or
interest or because such director or directors are present at the meeting of the
Board of Directors or a committee thereof which authorizes, approves or ratifies
such contract or transaction or because their votes are counted for such
purpose, if:
(i) The fact of such relationship or interest is disclosed
or known to the Board of Directors or committee which authorizes, approves or
ratifies the contract or transaction by a vote
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or consent sufficient for the purpose without counting the votes or consents of
such interested directors, or
(ii) The fact of such relationship or interest is disclosed
or known to the shareholders entitled to vote and they authorize, approve or
ratify such contract or transaction by vote or written consent; or
(iii) The contract or transaction is fair and reasonable as
to the Corporation at the time it is authorized by the Board, a committee, or
the shareholders.
(b) Interested directors, whether or not voting, may be counted in
determining the presence of a quorum at a meeting of the Board of Directors or a
committee thereof which authorizes, approves or ratifies such contract or
transaction.
SECTION 6. EXECUTIVE AND OTHER COMMITTEES, DESIGNATION, AUTHORITY
(a) The Board of Directors, by resolution adopted by the full Board
of Directors, may designate from among its directors an Executive Committee and
one or more other committees each of which, to the extent provided in such
resolution or in the Articles of Incorporation or these Bylaws, shall have and
may exercise all the authority of the Board of Directors, except that no such
committee shall have the authority to : (i) approve or recommend to shareholders
actions or proposals required by the Florida General Corporation Act to be
approved by shareholders; (ii) designate candidates for the office of director
for purposes of proxy solicitation or otherwise; (iii) fill vacancies on the
Board of Directors or any committee thereof; (iv) amend these Bylaws; (v)
authorize or approve the reacquisition of shares unless pursuant to a general
formula or method specified by the Board of Directors; or (vi) authorize or
approve the issuance or sale of, or any contract to issue or sell, shares or
designate the terms of a series of a class of shares, unless the Board of
Directors, having acted regarding general authorization for the issuance or sale
of shares, or any contract therefor, and, in the case of a series, the
designation thereof has specified a general formula or method by resolution or
by adoption of a stock option or other plan, authorized a committee to fix the
terms upon which such shares may be issued or sold, including, without
limitation, the price, the rate or manner of payment of dividends, provisions
for redemption, sinking fund, conversion, and voting or preferential rights, and
provisions for other features of a class of shares, or a series of a class of
shares, with full power in such committee to adopt any final resolution setting
forth all the terms of a series for filing with the Department of State under
the Florida General Corporation Act.
(b) The Board, by resolution adopted in accordance with Section 6(a)
of this Article II, may designate one or more directors as alternate members of
any such committee, who may act in the place and stead of any absent member or
members at any meeting of such committee.
(c) Neither the designation of any such committee, the delegation
thereto of authority, nor action by such committee pursuant to such authority
shall alone constitute compliance by a member of the Board of Directors, not
member of the committee in question, with his responsibility
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to act in good faith, in manner he reasonably believes to be in the best
interests of the Corporation, and with such care as an ordinarily prudent person
in a like position would use under similar circumstances.
SECTION 7. PLACE, TIME, NOTICE AND CALL OF DIRECTORS' MEETING.
(a) Meetings of the Board of Directors, regular or special, may be
held either within or without the State of Florida.
(b) A regular meeting of the Board of Directors of the Corporation
shall be held for the election of officers of the Corporation and for the
transaction of such other business as may come before such meeting as promptly
as practicable after the annual meeting of the shareholders of this Corporation
without the necessity of notice other than this Bylaw. Other regular meetings of
the Board of Directors of the Corporation may be held at such places as the
Board of Directors of the Corporation may from time to time resolve without
notice other than such resolution. Special meetings of the Board of Directors
may be held at any time upon call of the Chairman of the Board of Directors or a
majority of the Directors of the Corporation, at such time and at such place as
shall be specified in the call thereof. Notice of any special meeting of the
Board of Directors must be given at least two days prior thereto, if by written
notice delivered personally; or at least five days prior thereto, if mailed; or
at least two days prior thereto, if by telegram, or at least two days prior
thereto, if by telephone. If such notice is given by mail, such notice shall be
deemed to have been delivered when deposited with the United States Postal
Service addressed to the business address of such Director with postage thereon
prepaid. If notice be given by telegram, such notice shall be deemed delivered
when the telegram is delivered to the telegraph company. If notice is given by
telephone, such notice shall be deemed delivered when the call is completed.
(c) Notice of a meeting of the Board of Directors need not be given
to any Director who signs a waiver of notice either before or after the meeting.
Attendance of a Director at a meeting shall constitute a waiver of notice of
such meeting and waiver of any and all objections to the place of the meeting,
the time of the meeting, or the manner in which it has been called or convened,
except when a Director states, at the beginning of the meeting, any objection to
the transaction of business because the meeting is not lawfully called or
convened.
(d) Neither the business to be transacted at, nor the purpose of, any
regular of special meeting of the Board of Directors need be specified in the
notice or waiver of notice of such meeting.
(e) A majority of the directors present, whether or not a quorum
exists, may adjourn any meeting of the Board of Directors to another time and
place. Notice of any such adjourned meeting shall be given to the Directors who
were not present at the time of the adjournment and, unless the time and place
of the adjourned meeting are announced at the time of the adjournment, to the
other Directors.
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(f) Members of the Board of Directors may participate in a meeting of
such Board by means of a conference telephone or similar communications
equipment by means of which all persons participating in the meeting can hear
each other at the same time. Participation by such means shall constitute
presence in person at a meeting.
SECTION 8. ACTION BY DIRECTORS WITHOUT A MEETING
(a) Any action required by the Florida General Corporation Act to be
taken at a meeting of the Directors of the Corporation, or any action which may
be taken at a meeting of the Directors or a committee thereof, may be taken
without a meeting if a consent in writing, setting forth the action so to be
taken, signed by all of the Directors, or all of the members of the committee,
as the case may be, and is filed in the minutes of the proceedings of the Board
or of the committee. Such consent shall have the same effect as a unanimous
vote.
(b) If not contrary to applicable law, directors may take action as
the Board of Directors or committees thereof through a written consent to action
signed by a number of directors sufficient to have carried a vote of the Board
of Directors or committee thereof with all members present and voting; provided,
that all directors not joining in such written instrument shall be deemed for
all purposes to have cast dissenting votes, and that all directors not parties
to such instrument shall receive written notice of all action taken through such
instrument within three days after such instrument shall have been subscribed by
the requisite number of directors required for such action.
SECTION 9. COMPENSATION
The Directors and members of the Executive and any other committee of
the Board of Directors shall be entitled to such reasonable compensation for
their services and on such basis as shall be fixed from time to time by
resolution of the Board of Directors. The Board of Directors and members of any
committee of that Board of Directors shall be entitled to reimbursement for any
reasonable expenses incurred in attending any Board or committee meeting. Any
Director receiving compensation under this Section shall not be prevented from
serving the Corporation in any other capacity and shall not.be prohibited from
receiving reasonable compensation for such other services.
SECTION 10. RESIGNATION
Any Director of the Corporation may resign at any time by providing
the Board of Directors with written notice indicating the Director's intention
to resign and the effective date thereof.
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ARTICLE III
OFFICERS
SECTION 1. ELECTION, NUMBER, TERMS OF OFFICE
(a) The officers of the Corporation shall consist of a Chairman of
the Board, a Chief Executive officer, a President, a Chief Operating Officer, a
Chief Financial Officer, one or more Vice-Presidents, a Secretary and a
Treasurer, each of whom shall be elected by the Board of Directors at such time
and in such manner as may be prescribed by these Bylaws. Such other officers and
assistance officers and agents as may be deemed necessary may be elected or
appointed by the Board of Directors. The officers of the Corporation shall be
hereinafter collectively referred to as the "Officers."
(b) All officers and agents, as between themselves and the
Corporation, shall have such authority and perform such duties in the management
of the Corporation as are provided in these Bylaws, or as may be determined by
resolution of the Board of Directors not inconsistent with these Bylaws.
(c) Any two or more offices may be held by the same person, except
for the offices of President and Secretary.
(d) A failure to elect a Chairman of the Board, Chief Executive
Officer, President, Chief Operating Officer, Chief Financial Officer, a Vice
President, a Secretary or a Treasurer shall not affect the existence of the
Corporation.
SECTION 2. REMOVAL
An officer of the Corporation shall hold office until the election
and qualification of his successor; however, any Officer of the Corporation may
be removed from office by the Board of Directors whenever in its judgment the
best interests of the Corporation will be served thereby. Such removal shall be
without prejudice to the contract rights, if any, of the person so removed.
Election or appointment of an officer shall not of itself create any contract
right to employment or compensation.
SECTION 3. VACANCIES
Any vacancy in any office from any cause may be filled for the
unexpired portion of the term of such office by the Board of Directors.
SECTION 4. POWERS AND DUTIES
(a) The Chairman of the Board of Directors shall preside over
meetings of the Board of Directors and the Shareholders. Unless a separate Chief
Executive Officer is elected, the Chairman
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shall exercise the powers hereafter granted to that office. Unless a Chairman of
the Board is specifically elected, the President shall be deemed to be the
Chairman of the Board.
(b) The Chief Executive Officer shall be the principal officer of the
Corporation to whom all other officers shall be subordinate. In the event no
Chief Executive Officer is separately elected, such office shall be assumed by
the Chairman of the Board, and if no such office has been filled, by the
President. Except where by law the signature of the President is required or
unless the Board of Directors shall rule otherwise, the Chief Executive Officer
shall possess the same power as the President to sign all certificates,
contracts and other instruments of the Corporation which may be authorized by
the Board of Directors.
(c) The Chief Operating Officer of the Corporation shall be
responsible for management of the day to day affairs of the Corporation, subject
to compliance with the directions of the Board of Directors and of the Chief
Executive Officer. He shall be responsible for the general day-to-day
supervision of the business and affairs of the Corporation. He shall sign or
countersign all certificates, contracts or other instruments of the Corporation
as authorized by the Board of Directors. He may, but need not, be a member of
the Board of Directors.
(d) Unless otherwise provided by specific resolution of the Board of
Directors, the President shall be the Chief Operating Officer of the
Corporation. In the absence of a separately elected or available Chief Executive
Officer or Chairman of the Board, the President shall be the Chief Executive
Officer of the Corporation and shall preside at all meetings of the shareholders
and the Board of Directors. He shall make reports to the Board of Directors. The
Board of Directors will at all times retain the power to expressly delegate the
duties of the President to any other Officer of the Corporation.
(e) The Chief Financial Officer shall be responsible for coordinating
all financial aspects of the Corporation's operations, including strategic
financial planning, supervision of the Corporation's Treasurer, Comptroller and
outside auditors. In the event an Audit Committee of the Board of Directors is
designated and serving, he shall be responsible for keeping such committee fully
and timely informed of all matters under its jurisdiction. In addition, the
Chief Financial Officer shall be responsible for overseeing preparation and
filing of all reports of the Corporation's activities required to be filed,
either periodically or on a special basis with the United States Internal
revenue Service and Securities and Exchange Commission and other federal and
state governmental agencies.
(f) The Vice President(s), if any, in the order designated by the
Board of Directors, shall exercise the functions of the President in the event
of the absence, disability, death, or refusal to act of the President. During
the time that any Vice President is properly exercising the functions of the
President, such Vice President shall have all the powers of and be subject to
all restrictions upon the President. Each Vice President shall have such other
duties as are assigned to him from time to time by the Board of Directors or by
the President of the Corporation.
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(g) The Secretary of the Corporation shall keep the minutes of the
meetings of the shareholders of the Corporation, and, unless provided otherwise
by the Chairman at any meeting of the Board of Directors, the Secretary shall
keep the minutes of the meetings of the Board of Directors of the Corporation.
The Secretary shall be the custodian of the minute books of the Corporation and
such other books and records of the Corporation as the Board of Directors of the
Corporation may direct. The Secretary of the Corporation shall have the general
responsibility for maintaining the stock transfer books of the Corporation, or
of supervising the maintenance of the stock transfer books of the Corporation by
the transfer agent, if any, of the Corporation. The Secretary shall be the
custodian of the corporate seal of the Corporation and shall affix the corporate
seal of the Corporation on contracts and other instruments as the Board of
Directors may direct. The Secretary shall perform such other duties as are
assigned to him from time by the Board of Directors or the President of the
Corporation.
(h) The Treasurer of the Corporation shall be directly subordinate to
the Chief Financial Officer. In the absence of a Chief Financial Officer, such
office shall be filled by the Treasurer. The Treasurer shall have custody of all
funds and securities owned by the Corporation. The Treasurer shall cause to be
entered regularly in the proper books of account of the Corporation full and
accurate accounts of the receipts and disbursements of the Corporation. The
Treasurer of the Corporation shall render a statement of the cash, financial and
other accounts of the Corporation whenever he is directed to render such a
statement by the Board of Directors or by the President of the Corporation. The
Treasurer shall at all reasonable times make available the Corporation's books
and financial accounts to any Director of the Corporation during normal business
hours. The Treasurer shall perform all other acts incident to the Office of
Treasurer of the Corporation, and he shall have such other duties as are
assigned to him from time to time by the Board of Directors or the President of
the Corporation.
(i) Other subordinate or assistant officers appointed by the Board of
Directors or by the President, if such authority is delegated to him by the
Board of Directors, shall exercise such powers and perform such duties as may be
delegated to them by the Board of Directors, the Chief Executive Officer or by
the President, as the case may be.
(j) In case of the absence or disability of any Officer of the
Corporation and of any person authorized to act in his place during such period
of absence or disability, the Board of Directors may from time to time delegate
the powers and duties of such Officer or any Director or any other person whom
it may select.
SECTION 5. SALARIES
The salaries of all Officers of the Corporation shall, except as
otherwise determined or required by an agreement entered into among all the
shareholders of the Corporation, be fixed by the Board of Directors. No Officer
shall be ineligible to receive such salary by reason of the fact that he is also
a Director of the Corporation and receiving compensation therefor.
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ARTICLE IV
LOAMS TO EMPLOYEES AND OFFICERS,
GUARANTEE OF OBLIGATIONS OF EMPLOYEES AND OFFICERS
This Corporation may lend money to, guarantee any obligation of, or
otherwise assist any Officer or other employee of the Corporation or of a
subsidiary, including any Officer or employee who is a Director of the
Corporation or of a subsidiary, whenever, in the judgment of the Directors, such
loan, guarantee or assistance may reasonably be expected to benefit the
Corporation. The loan, guarantee or other assistance may be with or without
interest, and may be unsecured, or secured in such manner as the Board of
Directors shall approve including, without limitation, a pledge of shares of
stock of the Corporation. Nothing in this Articles shall be deemed to deny,
limit or restrict the powers of guarantee or warranty of this Corporation at
common law or under any statute.
ARTICLE V
STOCK CERTIFICATES, VOTING TRUSTS, TRANSFERS
SECTION 1. CERTIFICATES REPRESENTING SHARES
(a) Every holder of shares of this Corporation shall be entitled to
one or more certificates, representing all shares to which he is entitled and
such certificates shall be signed by the Chairman, Chief Executive Officer, the
President or a Vice President and the Secretary or an Assistant Secretary of the
Corporation and may be sealed with the seal of the Corporation or a facsimile
thereof. The signatures of the Chairman, the Chief Executive Officer, the
President or Vice President and the Secretary or Assistant Secretary may be
facsimiles if the certificate is manually signed on behalf of a transfer agent
or a registrar, other than the Corporation itself or an employee of the
Corporation. In case any Officer who signed or whose facsimile signature has
been placed upon such certificate shall have ceased to be such Officer before
such certificate is issued, it may be issued by the Corporation with the same
effect as if it were executed by the appropriate Officer at the date of its
issuance.
(b) Every certificate representing shares issued by this Corporation
shall, if shares are divided into one or more classes or series with differing
rights, state that the Corporation will furnish to any shareholder upon request
and without charge a full statement of: (i) the designations, preferences,
limitations, and relative rights of the shares of each class or series
authorized to be issued, and (ii) the variations in the relative rights and
preferences between the shares of each such series, if the Corporation is
authorized to issue any preferred or special class in series and so far as the
same have been fixed and determined, and the authority of the Board of Directors
to fix and determine, the relative rights and preferences of subsequent series.
(c) Every certificate representing shares which are restricted as to
sale, disposition or other transfer (including restrictions based on federal or
state securities and other laws) shall state that such shares are restricted as
to transfer and shall set forth or fairly summarize upon the certificate,
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or shall state that the Corporation will furnish to any shareholder upon request
and without charge a full statement of, such restrictions.
(d) Each certificate representing shares shall state upon the face
thereof: (i) the name of the Corporation; (ii) that the Corporation is organized
under the laws of the State of Nevada; (iii) the name of the person or persons
to whom issued; (iv) the number and class of shares, and the designation of the
series, if any, which such certificate represents; and (v) the par value of each
share represented by such certificate, or a statement that the shares are
without par value.
(e) No certificate shall be issued for any shares until they are
fully paid for.
SECTION 2. TRANSFER BOOKS
The Corporation shall keep at its registered office or principal
place of business or in the office of its transfer agent or registrar, a book
(or books where more than one kind, class, or series of stock is outstanding) to
be known as the Stock Book, containing the names, alphabetically arranged,
addresses and Social Security numbers of every shareholder and the number of
shares each kind, class or series OF stock held of record. Where the Stock Book
is kept in the office of the transfer agent, the Corporation shall keep at its
office in the State of Florida copies of the stock lists prepared from said
Stock Book and sent to it from time to time by said transfer agent. The Stock
Book or stock lists shall show the current status of the ownership of shares of
the Corporation provided that, if the transfer agent of the Corporation be
located elsewhere; a reasonable time shall be allowed for transit or mail.
SECTION 3. TRANSFER OF SHARES
(a) The name(s) and address(es) of the person(s) to whom shares of
stock of this Corporation are issued, shall be entered on the Stock Transfer
Books of the Corporation, with the number of shares and date of issue.
(b) Transfer of shares of the Corporation shall be made on the Stock
Transfer Books of the Corporation by the Secretary or the transfer agent,
subject to compliance with any restrictions specified on such certificate, only
when the holder of record thereof or the legal representative of such holder of
record or the attorney-in-fact of such holder of record, authorized by power of
attorney duly executed and filed with the Secretary or transfer agent of the
Corporation, shall surrender the Certificate representing such shares for
cancellation. Lost, destroyed or stolen Stock Certificates shall be replaced
pursuant to Section 5 of this Article V.
(c) The person or persons in whose names shares stand on the books of
the Corporation shall be deemed by the Corporation to be the owner of such
shares for all purposes, except as otherwise provided pursuant to Sections 10
and 11 of Article I, or Section 4 of Article V.
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(d) Shares of the Corporation capital stock shall be freely
transferable without the rewired Board of Directors' consent, unless such
consent requirement has been imposed pursuant to a binding written contract
subscribed to by the holder or his or her predecessor in interest.
SECTION 4. VOTING TRUSTS
(a) Any number of shareholders of the Corporation may create a voting
trust for the purpose of conferring upon a trustee or trustees the right to vote
or otherwise represent their shares, for a period not to exceed ten years, by:
(i) entering into a written voting trust agreement specifying the terms and
conditions of the voting trust; (ii) depositing a counterpart of the agreement
with the Corporation at its registered office; and (iii) transferring their
shares to such trustee or trustees for the purposes of this Agreement. Prior to
the recording of the agreement, the shareholder concerned shall render the stock
certificate(s) described therein to the Corporate Secretary who shall note on
each certificate:
"This Certificate is subject to the provisions of a voting trust
agreement dated _______________, recorded in Minute Book
__________________, of the Corporation.
__________________
Secretary
(b) Upon the transfer of such shares, voting trust certificates shall
be issued by the trustee or trustees to the shareholders who transfer their
shares in trust. Such trustee or trustees shall keep a record of the holders of
voting trust certificates evidencing a beneficial interest in the voting trust,
giving the names and addresses of all such holders and the number and class or
the shares in respect of which the voting trust certificates held by each are
issued, and shall deposit a copy of such record with the Corporation at its
registered office.
(c) The counterpart of the voting trust agreement and the copy of
such record so deposited with the Corporation shall be subject to the same right
of examination by a shareholder of the Corporation, in person or by agent or
attorney, as are the books and records of the Corporation, and such counterpart
and such copy of such record shall be subject to examination by any holder of
record of voting trust certificates either in person or by agent or attorney, at
any reasonable time for any proper purpose.
(d) At any time before the expiration of a voting trust agreement as
originally fixed or as extended one or more times under this Section 4(d), one
or more holders of voting trust certificates may, by agreement in writing,
extend the duration of such voting trust agreement, nominating the same or
substitute trustees, for an additional period not exceeding 10 years. Such
extension agreement shall not affect the rights or obligations or persons not
parties to the agreement, and such persons shall be entitled to remove their
shares from the trust and promptly to have their stock certificates reissued
upon the expiration of the original term of the voting trust agreement. The
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extension agreement shall in every respect comply with and be subject to all the
provisions of this Section 4, applicable to the original voting trust agreement
except that the 10 year maximum period of duration shall commence on the date of
adoption of the extension agreement.
(e) The trustees under the terms of the agreements entered into under
the provisions of this Section 4, shall not acquire the legal title to the
shares but shall be vested only with the legal right and title to the voting
power which is incident to the ownership of the shares.
(f) Notwithstanding generally applicable prohibitions against a
corporation's voting of treasury stock, if the Corporation is the trustee under
a voting trust, it shall have full authority to vote such shares in accordance
with the terms of the voting trust agreement, even if such agreement vests
absolute and unfettered voting discretion in the trustee and notwithstanding
that the voting trust was created at the prompting or direction of the
Corporation, its officers or directors.
SECTION 5. LOST, DESTROYED, OR STOLEN CERTIFICATES
No Certificate representing shares of stock in the Corporation shall
be issued in place of any Certificate alleged to have been lost, destroyed, or
stolen except on production of evidence, satisfactory to the Board of Directors,
of such loss, destruction or theft, and, if the Board of Directors so requires,
upon the furnishing of an indemnity bond in such amount (but not to exceed twice
the fair market value of the shares represented by the Certificate) and with
such terms and with such surety as the Board of Directors may, in its
discretion, require.
ARTICLE VI
BOOKS AND RECORDS
(a) The Corporation shall keep correct and complete books and records
of account and shall keep minutes of the proceedings of its shareholders, Board
of Directors and committees of Directors.
(b) Any books, records and minutes may be in written form or in any
other form capable of being converted into written form within a reasonable
time.
(c) Any person who shall have been a holder of record of shares, or
the holder of record of voting trust certificates for, at least five percent of
the outstanding shares of any class or series of the Corporation, upon written
demand stating the purpose thereof, shall; subject to the qualifications
contained in subsection (d) hereof, have the right to examine, in person or by
agent or attorney, at any reasonable time or times, for any purpose, its
relevant books and records of account, minutes and records of shareholders and
to make extracts therefrom.
(d) No shareholder who within two years has sold or offered for sale
any list of shareholders or of holders of voting trust certificates for shares
of this Corporation or any other
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corporation; has aided or abetted any person in procuring any list of
shareholders or of holders of voting trust certificates for any such purpose; or
has improperly used any information secured through any prior examination of the
books and records of account, minutes, or record of shareholders or of holders
of voting trust certificates for shares of the Corporation of any other
corporation; shall be entitled to examine the documents and records of the
Corporation as provided in Section (c) of this Article VI. No shareholder who
does not act in good faith or for a proper purpose in making his demand shall be
entitled to examine the documents and records of the corporation as provided in
Section (c) of this Article VI.
(e) Unless modified by resolution of the Shareholders, this
Corporation shall prepare not later than four months after the close of each
fiscal year:
(i) A balance sheet showing in reasonable detail the
financial conditions of the Corporation as of the date of the close of its
fiscal year.
(ii) A Profit and Loss statement showing the results of its
operation during its fiscal year.
(f) Upon the written request of any shareholder or holder of voting
trust certificates for shares of the Corporation, the Corporation shall mail to
such shareholder or holder of voting trust certificates a copy of its most
recent balance sheet and profit and loss statement.
(g) Such balance sheets and profit and loss statements shall be filed
and kept for at least five years in the registered office of the Corporation in
the State of Florida and shall be subject to inspection during business hours by
any shareholder or holder of voting trust certificates, in person or by agent.
ARTICLE VII
DIVIDENDS
The Board of Directors of the Corporation may, from time to time,
declare, and the Corporation may pay dividends on its own shares, except wh_..
the Corporation is insolvent or when the payment thereof would render the
Corporation insolvent, subject to the following provisions:
(a) Dividends in cash or property may be declared and paid, except as
otherwise provided in this Article VII, only out of the unreserved and
unrestricted earned surplus of the Corporation or out of capital surplus,
however arising, but each dividend paid out of capital surplus shall be
identified as a distribution of capital surplus, and the amount per share paid
from such capital surplus shall be disclosed to the shareholders receiving the
same concurrently with the distribution.
(b) If the Corporation shall engage in the business of exploiting
natural resources or other wasting assets and if the Articles of Incorporation
so provide, dividends may be declared and paid
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in cash out of depletion or similar reserves, but each such dividend shall be
identified as distribution OF such reserves and the amount per share paid from
such reserves shall be disclosed to the shareholders receiving the same
concurrently with the distribution thereof.
shares.
(c) Dividends may be declared and paid in the Corporations treasury
(d) Dividends may be declared and paid in the Corporation's
authorized but unissued shares, out of any unreserved and unrestricted surplus
of the Corporation, upon the following conditions:
(i) If a dividend is payable in the Corporations' own
shares having a par value, such shares shall be issued at not less than the par
value thereof and there shall be transferred to stated capital at the time such
dividend is paid an &-nouns of surplus equal to the aggregate par value of the
shares to be issued as a dividend.
(ii) If a dividend is payable in the Corporations' own
shares without par value, such shares shall be issued at a stated value fixed by
the Board of Directors by resolution adopted at the time such dividend is
declared, and there shall be transferred to stated capital at the time such
dividend is paid an amount of surplus equal to the aggregate stated value so
fixed and the amount per share so transferred to stated capital shall be
disclosed to the shareholders receiving such dividend concurrently with the
payment thereof.
(e) No dividend payable in shares of any class shall be paid to the
holders of shares of any other class unless the Articles of Incorporation so
provide or such payment is authorized by the affirmative vote or the written
consent of the holders of at least a majority of the outstanding shares of the
class which the payment is to be made.
(f) A split or division of the issued shares of any class into a
greater number of shares of the same class without increasing the stated capital
of the Corporation shall not be construed to be a stock dividend within the
meaning of this Article VII.
ARTICLE VIII
SEAL
The Board of Directors shall adopt a Corporate Seal which shall be
circular in form and shall have inscribed thereon the name of the Corporation,
the state of incorporation and the year of incorporation.
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ARTICLE IX
INDEMNIFICATION
This Corporation may, in its discretion, indemnify any director,
officer, employee, or agent in the following circumstances and in the following
manner:
(a) The Corporation may indemnify any person who was or is a part, or
is threatened to be made a party to any threatened, pending, or completed
action, suit, or proceeding, whether civil, criminal, administrative, or
investigative (other than an action by, or in the right of, the Corporation) by
reason of the fact that he is or was a director, officer, employee, or agent of
the Corporation, or is or was serving at the request of the Corporation as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust, or other enterprise, against expenses (including attorneys' fees
at all trial and appellate levels), judgments, fines and amounts paid in
settlement actually and reasonably incurred by him in connection with such
action, suit, or proceeding, including any appeal thereof, if he acted in good
faith and in a manner he reasonably believed to be in, or not opposed to, the
best interests of the Corporation and, with respect to any criminal action or
proceeding, had no reasonable cause to believe his conduct was unlawful. The
termination of any action, suit, or proceeding by judgment, order, settlement,
conviction or upon a plea of nolo contendere or its equivalent shall not, of
itself, create a presumption that the person did not act in good faith and in a
manner which he reasonable believed to be in, or not opposed to, the best
interests of the Corporation or, with respect to any criminal action or
proceeding, had reasonable cause to believe that his conduct was unlawful.
(b) The Corporation may indemnify any person who was or is a party,
or is threatened to be made a party to any threatened, pending, or completed
action or suit by or in the right of the Corporation to procure a judgment in
its favor by reason of the fact that he is or was a director, officer, employee,
or agent of the Corporation or is or was serving at the request of the
Corporation as a director, officer, employee, or agent of the Corporation as a
director, officer, employee, or agent of another corporation, partnership, joint
venture, trust, or other enterprise against expenses (including attorneys' fees
at all trial and appellate levels), actually and reasonable incurred by him in
connection with the defense of settlement of such action or suit, including any
appeal thereof, if he acted in good faith and in a manner he reasonably believed
to be in, or not opposed to, the best interest of the Corporation, except that
no indemnification shall be made in respect of any claim, issue, or matter as to
which such person shall have been adjudged to be liable for negligence or
misconduct in the performance of his duty to the Corporation unless, and only to
the extent that, the court in which such action or suit was brought shall
determine upon application that, despite the adjudication of liability but in
view of all circumstances of the case, such person is rarely and reasonably
entitled to indemnity for such expenses which such court shall deem proper.
(c) To the extent that a Director, Officer, employee, or agent of the
Corporation has been successful on the merits or otherwise in defense of any
action, suit, or proceeding referred to in Sections (a) or (b) of this Article
IX, or in defense of any claim, issue, or matter therein, shall be
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indemnified against expenses (including attorneys' fees at trial and appellate
levels) actually and reasonably incurred by him in connection therewith.
(d) Any indemnification under Sections (a) or (b) of this Article IX,
unless pursuant to a determination by a court, shall be made by the Corporation
only as authorized in the specific case upon a determination that
indemnification of the director, officer, employee, or agent is proper in the
circumstances because he has met the applicable standard of conduct set forth in
Sections (a) or (b) or this Article IX. Such determination shall initially be
made by the Board of Directors by a majority vote of a quorum consisting of
Directors who were not parties to such action, suit, or proceeding. If the Board
of Directors shall, for any reason, decline to make such a determination, then
such determination shall be made by the shareholders by a majority vote of a
quorum consisting of shareholders who were not parties to such action, suit or
proceeding; provided, however, that a determination made by the Board of
Directors pursuant to this Section may be appealed to the shareholders by the
party seeking indemnification or any party entitled to call a special meeting of
the shareholders pursuant to Section 2 of Article I and, in such case, the
determination made by the majority vote of a quorum consisting of shareholders
who were not parties to such action, suit, or proceeding shall prevail over a
contrary determination OF the Board of Directors pursuant to this Section.
(e) Expenses (including attorneys' fees at all trial and appellate
levels) incurred in defending a civil or criminal action, suit or proceeding may
be paid by the Corporation in advance of the final disposition of such action,
suit or proceeding upon a preliminary determination following one of the
procedures set forth in this Article IX, that a Director, Officer, employee or
agent met the applicable standard of conduct set forth in this Article IX, and
upon receipt of an undertaking by or on behalf of the director, officer,
employee or agent to repay such amount, unless it shall ultimately be determined
that he is entitled to be indemnified by the Corporation as authorized in this
section.
(f) The Corporation may make any other or further indemnification,
except an indemnification against gross negligence or willful misconduct, under
any agreement, vote of shareholders or disinterested Directors or otherwise,
both as to action in the indemnified party's official capacity and as to action
in another capacity while holding such office.
(g) Indemnification as provided in this Article IX may continue as to
a person who has ceased to be a director, officer, employee or agent and may
inure to the benefit of the heirs, executors and administrators of such a person
upon a proper determination initially made by the Board of Directors by a
majority vote of a quorum consisting of Directors who were not parties to such
action, suit, or proceeding. If the Board of Directors shall, for any reason,
decline to make such a determination, then such determination may be made by the
shareholders by a majority vote of a quorum consisting of shareholders who were
not parties to such action, suit or proceeding; provided, however, that a
determination made by the Board of Directors pursuant to this Section may be
appealed to the shareholders by the party seeking indemnification or his
representative or by any party entitled to call a special meeting of the
shareholders pursuant to Section 2 or Article I and in such case, the
determination made by the majority vote of quorum consisting of shareholders who
were
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not parties to such action, suit, or proceeding shall prevail over a contrary
determination of the Board of Directors pursuant to this Section (g).
(h) The Corporation may purchase and maintain insurance on behalf of
any person who is or was a director, officer, employee or agent of the
Corporation, or is or was serving at the request of the Corporation as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, against any liability asserted against him
and incurred by him in any such capacity or arising out of his status as such,
whether or not the Corporation would have the power to indemnify him against
such liability under the provisions of this Article IX.
(i) If any expenses or other amounts are paid by way of
indemnification, otherwise than by court order or action by the shareholders or
by an insurance carrier pursuant to insurance maintained by the Corporation, the
Corporation shall, not later than the time of delivery to shareholders or
written notice of the next annual meeting of shareholders unless such meeting is
held within three months from the date of such payment, and, in any event,
within 15 months from the date of such payment, deliver either personally or by
mail to each shareholder of record at the time entitled to vote for the election
of Directors a statement specifying the persons paid, the amount paid, and the
nature and status at the time of such payment of the litigation of threatened
litigation,
(j) This Article IX shall be interpreted to permit indemnification to
the fullest extent permitted by law. If any part of this Article shall be found
to be invalid or ineffective in any action, suit of proceeding, the validity and
effect of the remaining part thereof shall not be affected. The provisions of
this Article IX shall be applicable to all actions, claims, suits, or
proceedings made or commenced after the adoption hereof, whether arising from
acts or omissions to act occurring before or after its adoption.
ARTICLE X
AMENDMENT OF BYLAWS
The Board of Directors shall have the power to amend, alter, or
repeal these Bylaws, and to adopt new Bylaws.
ARTICLE XI
FISCAL YEAR
The Fiscal Year of this Corporation shall be determined by the Board
of Directors.
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ARTICLE XII
MEDICAL REIMBURSEMENT
SECTION 1. BENEFITS
The Corporation may, subject to approval of the Board of Directors
reimburse all employees for expenses incurred by themselves and their
Dependents, as defined in Section 152 of the Internal Revenue Code of 1954, as
amended (the "IRC"), for medical care, as defined in IRC Section 213(e) or any
successor section thereto, subject to the conditions and limitations hereinafter
set forth.
It is the intention of the Corporation that the benefits payable to
employees hereunder will be excluded from their gross income pursuant IRC
Section 105 or any successor section thereto
SECTION 2. EMPLOYEES DEFINED
The term "employees" as used in this medical expense plan is hereby
defined to include all individuals employed by the corporation except the
following:
(a) Employees who have not completed three months of service as is
provided in IRC Section 105(h)(3) (b)(i), or any successor section thereto;
(b) Employees who have not attained the age of 25 years;
(c) Employees who are part-time or seasonal as is defined in IRC
Section 105(h)(3)(B)(iii) or any successor section thereto;
(d) Employees who are included in a unit of employees covered by an
agreement between employee representatives and one or more employers found to be
a collective bargaining agreement; where accident and health benefits were the
subject of good faith bargaining between such employee representatives and such
employer(s) as is defined in IRC Section 105(h)(3)(B)(iv) or any successor
section thereto;
(e) Employees who are nonresident aliens and who receive no earned
income from the employer which constitutes income from sources within the United
States as is further defined in IRC Section 105(h)(5)(B)(v) or any successor
section thereto,
SECTION 3. LIMITATIONS
(a) The Corporation will reimburse any employee no more than
$5,000.00 in any fiscal year for medical care expenses;
(b) Reimbursement or payment provided under this plan will be made by
the Corporation only in the event and to the extent that such reimbursement or
payment is not provided under any
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insurance policy(ies), whether owned by the Corporation or the employee, or
under any other health and accident or wage continuation plan;
(c) In the event that there is such an insurance policy or plan in
effect providing for reimbursement in whole or in part, then to the extent of
the coverage under such policy or plan, the Corporation will be relieved of any
and all liability hereunder.
SECTION 4. SUBMISSION OF PROOF
Any employee applying for reimbursement under this plan will submit
to the Corporation, at least quarterly, all bills for medical care, including
premium notices for accident or health insurance, for verification by the
Corporation prior to payment. Failure to comply herewith, may at the discretion
of the Board of Directors, terminate such employee's right to said
reimbursement.
SECTION 5. DISCONTINUATION
This plan will be subject to termination at any time by vote of the
Board of Directors; provided, however, that medical care expenses incurred prior
to such termination will be reimbursed or paid in accordance with the terms of
this plan.
SECTION 6. DETERMINATION
The Chief Executive Officer will determine all questions arising from
the administration and interpretation of the Plan except where reimbursement is
claimed by the President. In such case determination will be made by the Board
of Directors.
* * *
The Undersigned, being the duly elected and acting secretary of the Corporation,
hereby certifies that the foregoing constitute the validly adopted and true
Bylaws of the Corporation, as of the date set forth below.
FIRST FLORIDA COMMUNICATIONS, INC.
Dated:_________________ ________________________________
Secretary
(Corporate Seal)
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EXHIBIT 4.1
EX-4.1
[STOCK CERTIFICATE]
NUMBER PAR VALUE $.0001 SHARES
- ---------- -----------
- ---------- -----------
FIRST FLORIDA
COMMUNICATIONS, INC.
INCORPORATED UNDER THE LAW OF THE STATE OF FLORIDA
COMMON STOCK CUSIP 32026P 20 6
SEE REVERSE FOR CERTAIN DEFINITIONS
THIS CERTIFIES THAT
Is the owner of
Fully Paid and Non-Assessable Shares of Common Stock of First Florida
Communications, Inc., transferable only on the books of the Corporation by the
holder hereof in person or by duly authorized attorney upon surrender of this
Certificate properly endorsed. This Certificate is not valid unless
countersigned and registered by the Transfer Agent and Registrar.
Witness the facsimile seal of the Corporation and the facsimile signatures of
its duly authorized officers.
Date [SEAL]
------------------ --------------------
President Director
================================================================================
Countersigned: Florida Atlantic Stock Transfer, Inc. 7130 Nob Hill Road Tamarac,
FL 33321 Transfer agent
<PAGE>
The following abbreviation, when used in the inscription on the face of this
certificate, shall be construed as though they were written out in full
according to the applicable laws or regulations:
TEN CON - as tenants in common UNIF GIFT MIN ACT - Custodian
(Cuss) (Minor)
TEN ENT - as tenants by the entireties
JT TEN - as joint tenants with right under Uniform Gifts to Minors
of survivorship and not
as tenants in common
Additional abbreviations may also be used though not in the above list.
For value received,____________________ hereby sell, assign and transfer unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
______________________________________
______________________________________
______________________________________
Please print or typewrite name and address including postal zip code of assignee
______________________________________
______________________________________
______________________________________
Shares of the capital stock represented by the within Certificate; and do hereby
irrevocably constitute and appoint
______________________________________
Attorney to transfer the said stock on the books ***
EXHIBIT 4.2
EX - 4.2
A.
CORPORATE RESOLUTION
The undersigned, Corporate Officers of M.B. BROADCASTING, INC., a Utah
Corporation (hereinafter called Company), hereby certifies that:
1. A Merger Proposal has been submitted to the Board of
Directors pursuant to the Board's Corporate Resolution
dated January 11, 1999.
2. The Proposal was made by a Majority Stockholder from whom a
vote was taken of all stockholders who have unanimously
ratified the Merger Proposal.
3. That this Board of Directors now files this Corporate
Resolution ratifying the following provisions of the Merger
Proposal.
RESOLVED THAT
A. M.B. BROADCASTING, INC, and any and all of its subsidiaries, including
INKWELL, INC., does hereby merge with FIRST FLORIDA COMMUNICATIONS, INC.
(FFCI) as wholly owned subsidiaries.
B. That as of the execution of this Corporate Resolution, the Board of
Directors of M.B. Broadcasting are hereby dissolved and the newly
functioning Board of Directors shall be that FLORIDA COMMUNICATIONS, INC.
and that any and all Corporate Resolutions, Board Actions, or any and all
other decisions of FFC1I shall have full force and effect upon the
operations, management, and all business decisions concerning M.B.
BROADCASTING, INC.
C. That as of the execution of this Corporate Resolution, all business
decisions, management, and control of M.B. Broadcasting and its
subsidiaries shall be under the direct control, management, and execution
of FIRST FLORIDA COMMUNICATIONS, INC.
D. That any and all employees of M.B. Broadcasting, Inc. shall be employees of
FIRST FLORIDA COMMUNICATIONS, INC. with
<PAGE>
full loyalty and fiduciary responsibilities and duties owed to FFCI.
E. That any actions necessary by this, the former Board of Directors Of M.B.
Broadcasting, Inc., to effectuate this Resolution shall be done with time of
the essence.
"FURTHER RESOLVED, that the President of the Company be and he is hereby
authorized to execute and deliver, and the Secretary Assistant Secretary or
other designated Corporate Officer of the Company be and he is hereby
authorized, (but where it is inapplicable or unnecessary, is not required to
do), to attest to and affix the seal of the Company to any and all instrument-s
necessary in order to accomplish the transactions hereinabove referred to and
any and all other instruments required in connection with the consummation of
this transaction as the officers of the Company executing same may deem
advisable, and in the best interest of the Company, all of such instruments
executed and delivered as aforesaid to be and constitute the acts and
obligations of the Company; the Company hereby ratifying and confirming the acts
of its officers in executing and delivering all of such instruments irrespective
of whether such acts where performed before, simultaneously with, or subsequent
to the date of adoption hereof, and directing the officers and employees of the
Company to perform all of the Company's obligations and undertakings under each
and all of such Instruments;" and
"FURTHER RESOLVED, that these Resolutions shall continue in full force and
effect that may be relied upon by all parties."
IN WITNESS WHEREOF, the undersigned has hereunto set his hand and affixed the
corporate seal of the Company on this day 10 of February, 1999.
(CORPORATE SEAL)
<PAGE>
CORPORATE - RESOLUTION
The undersigned officers of M.B. BROADCASTING, INC. do hereby certify the
following:
1. The Organization, standing, and qualification of M.B. BROADCASTING
is validly existing, and.in good standing under the laws of Utah; it
has all requisite corporate power and authority and is entitled to
carry on its business as now being conducted and to-own, lease, or
operate its properties as and in the places where such business is
now conducted and such properties are now owned, leased, or
operated; and it is duly qualified, licensed, or operated and it is
duly qualified, licensed, or domesticated and in good standing as a
foreign corporation authorized to do business in various
jurisdictions.
2. All accounts, records, and assets, including barter, have not been
altered, with the exception of that necessary for the ordinary
operation and course of business, since the presentation of its
financials and Balance funds were presented to Seller's CFO, Kent
Whitesell.
3. No other subsidiaries or stockholders exist with the exception of
INKWELL,Inc. and stock holders Brent Miner, Wally Brazzaal, and Ray
Carpantor.
4. There is no other stock nor is any new stock projected beyond the
outatanding 1,000,000 shares.
5. Any resolution to merge with FFCI may take place by written vote of
the stock holders, with a formal proposition being presented in the
requested form by any stockholder, without the necessity of a formal
stockholders meeting with the final decision being made by a
majority of the stockholder. The vote shall take place no later than
7 days after the proposition has been presented to the corporate
officers.
<PAGE>
B.
(THIS IS AN EXAMPLE OF ONE OF SEVEN STOCK PURCHASE AGREEMENTS TO THE STOCK
HOLDER OF MB BROADCASTING - THESE WERE EXECUTED TO ALL STOCK HOLDERS OF MB
BROADCASTING)
STOCK PURCHASE AGREEMENT
AGREEMENT dated January 11, 1999, by and among Wallace C. Brazzeal an individual
(hereinafter "Seller) whose address is 3591 Lupin Way St. George, Utah being a
stockholder of MB BROADCASTING, INC and INK WELL, INC., (herein after "MB")
which is a Utah corporation having its principal office at 251 West Hilton Drive
St. George, Utah and FIRST FLORIDA COMMUNICATIONS, INC. (herein after
"Purchaser") , a Florida corporation having its principal office at 5635 South
University Drive, Davie, Florida.
WITNESSETH:
In consideration of the mutual covenants and set forth, the parties hereby agree
as follows:
I . PURCHASE OF STOCK, Subject to and upon the terms and conditions set forth in
this Agreernent, Seller in consideration as set forth herein agrees to sell,
transfer and deliver his/her common stock of MB and its affiliates/subsidiaries
for a total number of 400,000 shares to FFCI free of any and all encumbrances or
restrictions except as presently exist in the bylaws of MB.
2. PURCHASE PRICE.
(a) In consideration or the sale and transfer and delivery of
the Seller's stock to Purchaser. Purchaser will in full payment thereof, deliver
to Seller common stock of FFCI restricted for one year from the date of receipt
of Seller's stock FFCI stock. The purchase of said stock is for the sole purpose
of Purchaser acquiring all issued stock of Seller a total sales price of
$3,000,000.00
(i) Seller shall receive FFC1 common stock restricted for one
year from the date of issuance based on a value of $5.00 per share.
(ii) The stock cenificate(s) of FFCI stock shall be made out
by FFCI's transfer agent and corporate counsel in the names of such parties as
requested by the Seller after they have submitted all necessary information.
(iii) Exchange of stock shall take place within approxinately
two weeks from the date of this executed Agreement.
<PAGE>
3. COVENANTS OF PURCHASER TO SELLER:
(a) Purchaser agrees that upon acquisition of all MB Stock, employment
contracts shall be negotiated between the two managing stock holders
and MB and FFCI.
(b) The current management of MB Broadcasting shall remain intact under the
direction of FFCI.
(C) One member of the current MB Broadcasting Board shall have a seat on
the Board of Directors,
(d) Purchaser agree to assume the previously disclosed liabilities of MB
Broadcasting. Purchaser shall provide funding for the previously
anticipated growth on a timely basis.
4. COVENANTS OF SELLER TO PURCHASER The Seller's stock in MB Broadcasting also
incorporates Seller's ownership of any and all affiliates, subsidiaries or
partnerships of any type of kind to MB.
5. TOTALITY OF AGREEMENT. This Agreement, shall constitute any and all
covenants, warranties or provision of this Purchase Agreement.
<PAGE>
C.
AGREEMENT OF PURCHASE AND SALE OF ASSETS
AGREEMENT dated__________________19____, by and among THE CATALOG CANNEL, INC.
(hereinafter "SELLER"), and FIRST FLORIDA COMMUNICATIONS, INC., (hereinafter
"FFCI"), a Florida corporation having its principal office at 5635 S. University
Drive, Davie, Florida ("Purchaser").
WITNESSETH:
In consideration of the mutual covenants and agreements hereinafter set
forth, the parties hereby agree as follows:
1. PURCHASE AND SALE OF BUSINESS AND ASSETS. Subject to and upon the
terms and conditions set forth in this Agreement, Seller will sell, transfer,
convey, assign, and deliver to Purchaser, and Purchaser will purchase, at the
Closing hereunder, all of the business, assets, properties, goodwill, and right
of Seller as a going concert, of every nature, kind, and description, tangible
and intangible, wheresoever located and whether or not carried or reflected on
books and records of Seller (hereinafter sometimes called "Seller's Assets"),
including, without limitation, (i) the right to use Sellers corporate name and
all variations thereof, (ii) any and all logos, insignias, and recognitions
relating to THE CATALOG CHANNEL, and (iii) any and all register trade names,
logos, or any and all filings of same relating thereof. Seller's Assets shall be
conveyed free and clear of all liabilities, obligations, liens, and encumbrances
excepting only those liabilities and obligations which are expressly to be
assumed by Purchaser hereunder, and those liens and encumbrances securing the
same which are specifically disclosed herein or expressly permitted by terms
hereof.
2. PURCHASE PRICE.
a. In consideration of the sale, transfer, conveyance,
assignment, and delivery of the Seller's Assets by Seller to Purchaser as stated
above, and in reliance upon the representation and warranties made herein by
Seller, Purchaser will, in full payment thereof, pay to Seller the following:
(i) Seller shall receive $100,000.00 within three
months from the time THE CATALOG CHANNEL is on the air the estimated date for
the initial airing is July 1, 1999.
<PAGE>
(ii) Seller shall receive a Royalty of 10% of the
gross sales, revenues, income, or benefits of any and all types and natures
relating tom any and all products, services, revenues, benefits, or affiliations
of any type of kind whatsoever whether generated from the airing of THE CATALOG
CHANNEL, its concept and idea, Internet business, or any other affiliation to
same. Said proceeds shall be paid at the end of each month directly into the
holding account for the Seller.
3. CLOSING. The Closing shall take place on or about, the 15ch day of
March, 1999, at the offices of Buyer or at such other time and place as the
parties may agree.
4. SELLER'S OBLIGATIONS AT CLOSING. Sellers shall be obligated to
execute any documents necessary for the Buyer to list or file Seller's
corporations, names, or any other assets purchased into its own corporate
entity.
5. REPRESENTATIONS AND WARRANTIES BY SELLER AND SHAREHOLDER. Seller and
each Shareholder jointly and severally represent and warrant to Purchaser as
follows:
(a) ORGANIZATION, STANDING, AND QUALIFICATION. Seller is a
corporation duly organized, validly existing, and in good standing under the
laws of Utah and Florida; it has all requisite corporate power and authority and
is entitled to carry on its business as now being conducted and to own, lease,
or operate its properties as and in the places where such business is now
Conducted and such properties are now owned, leased, or operated; and it is duly
qualified, licensed, or domesticated and in good standing as a foreign
corporation authorized to do business in various jurisdictions throughout the
United States. Seller has delivered to Purchaser true and complete copies of
Seller's certificate of incorporation and all amendments thereto, certified by
the Secretary of State of the state of Utah, and, the bylaws of, Seller as
presently in effect, certified as true and correct by Seller's Secretary.
(b) LITIGATION. There is no claim, legal action, suit,
arbitration, governmental investigation, or other legal or administrative
proceeding, nor any order, decree or judgement in progress, pending or in
effect, or to the knowledge of Seller or any Shareholder threatened, its
properties, assets or business or the transactions contemplated by this
Agreement.
<PAGE>
(C) COMPLIANCE WITH LAWS AND OTHER INSTRUMENTS. Seller has
complied with all existing laws, rules, regulations, ordinances, orders,
judgments, and decrees now (or hereafter) applicable to its business,
properties, or operations as presently conducted. Neither the ownership nor use
of Seller's properties nor the conduct of its business conflicts with the rights
of any other person, firm or corporation or violates, or with or without the
giving of notice or the passage of time, or both, will violate, conflict with or
result in a default, right to accelerate, or loss of rights under, any terms or
provisions of its certificate of incorporation or bylaws as presently in effect,
or any lien, encumbrance, mortgage, deed of trust, lease, license, agreement,
understanding, law, ordinance, rule or regulation, or any order, judgment, or
decree to which Seller is a party or by which it may be bound or affected.
(d) PATENTS, ETC. Seller owns, possesses, or has currently filed
for and are royalty free Licenses or other rights to use all copyrights,
trademarks, service marks, service names, trade names, patents, trade secrets.
and other proprietary rights necessary to conduct its business as it is
presently operated. Seller is not infringing upon or otherwise acting adversely
to any copyrights, trademarks, trademark rights, service marks, service names,
trade names, patents, patent rights, licenses, trade secrets, or other
proprietary rights owned by any other person or persons, and there is no claim
or action by any such person pending, or to the knowledge of Seller or any
Shareholder threatened, with respect thereto.
6.REPRESENTATIONS AND WARRANTIES BY PURCHASER. Purchaser represents and
warrants to Seller and the Shareholders as follows:
(a) ORGANIZATION. Purchaser is a corporation duly organized,
validly existing, and in good standing under the laws of Florida and has full
corporate power and authority to enter into his Agreement and the related
agreements referred to herein and to carry out the transactions contemplated by
this Agreement and to carry on its business as now being conducted and to own
lease, or operate its properties.
(b) AUTHORIZATION AND APPROVAL OF AGREEMENT. All proceedings or
corporate action required to be taken by Purchaser relating to the execution and
delivery of this Agreement and the consummation of the transaction contemplated
hereby shall have been taken at or prior to the Closing.
<PAGE>
7. EXECUTION, DELIVERY, AND PERFORMANCE OF AGREEMENT. Neither the
execution, delivery, nor performance of this Agreement by Purchaser will, with
or without the giving of notice or the passage of time, or both, conflict with,
result in a default, right to accelerate or loss of rights under, or results in
the creation of any lien, charge, or encumbrance pursuant to, any provision of
Purchaser`s certificate of incorporation or bylaws or any franchise, mortgage,
deed of trust, lease, license, agreement, understanding, law, ordinance, rule or
regulation or any order, judgment, or decree to which Purchaser is a party or by
which it may be bound or affected. Purchaser has full power and authority to
enter into this Agreement and to carry out the transactions contemplated hereby,
all proceedings required to be taken by Purchaser to authorize the execution,
delivery, and performance of this Agreement and the agreements relating hereto,
have been properly taken and this Agreement constitutes a valid and binding
obligation of Purchaser.
8. CHOICE OF LAWS. This Agreement and all amendments thereof shall be
governed by and construed in accordance with the law of the state of Florida
applicable to contracts made and to be performed therein.
9. LITIGATION. Any controversy or claim arising out of or relating to
this agreement or the breach or validity thereof shall be settled by litigation
and adjudicated pursuant to the law of Florida with such litigation being held
in Broward County, Florida.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as off the day and year first above written.
[Seller]
By___________________________
Date______________________ President
[Purchaser]
By___________________________
Date______________________
<PAGE>
D.
PURCHASE AGREEMENT
THIS AGREEMENT dated___________, 19___ by and between FIRST
FLORIDA COMMUNICATIONS, INC. (FFCI) hereinafter called "First Party" or "Buyer";
and SUMMIT ADVERTISING GROUP, INC. (SUMMIT) hereinafter called "SECOND PARTY" or
"Seller".
WITNESSETH:
WHEREAS;
(i) The First Party is a I publicly traded communications
corporation, with the intent, desire, and aspiration to acquire other, desire,
and aspiration to acquire other corporate entities, corporations, businesses,
and equities to add to its value, equity, marketability, and revenues for the of
its stockholders.
(ii) The Second Party is a Florida Corporation whose business is
advertising; production; and acquisition, distribution, and sale, of direct
response leads.
(iii) The First Party has agreed to purchase from the Second
Party and the Second Party has agreed to disperse, assign, convey transfer and
devise ownership of all it's equities base, good will, production, and revenues
pursuant to the terms, conditions, and considerations as are set forth herein.
NOW, THEREFORE, In consideration "on of the mutual covenants and
agreements hereinafter set forth, the parties hereby agree as follows:
1. PURCHASE AND SALE OF BUSINESS AND ASSETS. Subject to and upon the terms
and conditions set forth in this Agreement, Seller will sell, transfer, convey,
assign, and deliver to Purchaser, and Purchaser will purchase, at the Closing
hereunder, all of the business, assets, properties, goodwill, client base,
production, and rights of Seller as a going concern, of every nature, kind, and
description, tangible and intangible, wheresoever located and whether or not
carried reflected on the books and records of Seller (hereinafter sometimes
collectively called "Seller's Assets"), including, without limitations the right
to use sell, or devise as it so desires Seller's leads, corporate name and all
variations thereof. Seller's Assets shall be conveyed free and clear of all
liabilities, obligations, liens, and encumbrances excepting only those
1iabilities and obligations which are expressly to be assumed by Purchaser
hereunder, and those liens and encumbrances securing the same which are
specifically disclosed herein or expressly permitted by the terms hereof. The
Buyer shall have all unrestricted rights and privileges of ownership.
2. PURCHASE PRICE. In consideration of the sale, transfer, conveyance,
assignment, and delivery of the Seller's Assets by Seller to Purchaser as stated
above, and in reliance upon the representations and warranties made herein by
Seller, Purchaser will, in full payment thereof, pay to Seller the following:
(i)Purchase price shall be $1,500,000.00 to be paid in a combination of
FFCI stock valued at $5.00 per share and cash.
<PAGE>
(ii) Seller shall receive $100,000.00 within months from the time of
closing.
(iii) Seller shall receive 280,000 shares of FFCI stock which shall be
restricted for a period of one year pursuant to rule 144.
3. CLOSING. The Closing shall take place on or about, the 23rd day of March,
1999, at the offices of Buyer or at such other place as the parties may agree.
4.SELLER'S OBLIGATIONS AT CLOSING. Sellers shall be obligated to execute any
documents necessary for the Buyer to list or file Seller's corporations, names,
or any other assets purchased into its own corporate entity.
5.REPRESENTATIONS AND WARRANTIES BY SELLER AND SHAREHOLDE. Seller and each
Shareholder jointly and severally represent and warrant to Purchaser as follows:
(a) ORGANIZATION, STANDING, AND QUALIFICATON. Seller
is a corporation duly organized, validly existing, and in good standing
under the laws of Florida; it has all. Requisite corporate power and
authority and is entitled to carry on its business as now being conducted
and to own, lease, or operate its properties as and in the places where
such business is now conducted and such properties are now owned, leased,
or operated; and it is duly qualified, licensed, or domesticated and in
good standing as a foreign corporation authorized to do business in various
jurisdictions throughout the United States. Seller has delivered to
Purchaser true and complete copies of Seller's certificate of incorporation
and all amendments thereto, certified by the Secretary of State of the
state of Florida, and the bylaws of Seller as presently in effect,
certified as true and correct by Seller's Secretary.
(b) LITIGATION. There is no claim, legal action, suit, arbitration,
governmental investigation, or other legal or administrative proceeding,
nor any order, decree or judgment in progress, pending or in effect, or to
the knowledge of Seller or any Shareholder threatened, against or relating
to Seller, its employees, its properties, assets or officers, directors or
business or the transactions contemplated by this Agreement.
<PAGE>
(C) COMPLIANCE WITH LAWS AND OTHER INSTRUMENTS. Seller has complied with
all existing laws, rules, regulations, ordinances, orders, Judgments, and
decrees now [or hereafter] applicable to its business, properties, Or operations
as presently conducted. Neither the ownership nor use of Seller's properties nor
the conduct of its business conflicts with the rights of any other person, firm
or corporation or violates, or with or without the giving of notice or the
passage of time, or both, will violate, conflict with or result in a default,
right to accelerate, or loss of rights under, any terms or provisions of its
certificate of incorporation or bylaws as presently in effect, or any lien,
encumbrance, mortgage, deed of trust, lease, license, agreement, understanding,
law, ordinance, rule or regulation,. or any order, judgment, or decree to which
seller is a party or by which it may be bound or affected.
6. REPRESENTATIONS AND WARRAINTIES BY PURCHASER. Purchaser represents and
warrants to Seller and the Shareholders as follows:
(a) ORGANIZATION. Purchaser is a corporation duly organized,
validly existing, and in good standing under the laws of Florida and has full
corporate power and authority to enter into this Agreement and the related
agreements referred to herein and to carry out the transactions contemplated by
this Agreement and to carry on its business as now being conducted and to own,
lease, or operate its properties.
(h) AUTHORIZATION AND APPROVAL OF AGREEMENT. All proceedings or
corporate action required to be taken by Purchaser relating to the execution and
delivery or this Agreement and the consummation of the transactions contemplated
hereby shall have been taken at or prior to the Closing.
7. EXECUTION, DELIVERY, AND PERFORMANCE OF AGREEMENT... Neither the
execution, delivery, nor performance of this Agreement by Purchaser will, with
or without "the giving of notice or the passage of time, or both, conflict with,
result in a default, right to, accelerate or loss of rights under, or result in
the creation of any lien, charge, or encumbrance pursuant to, any provision of
Purchaser's certificate of incorporation or bylaws or any franchise, mortgage,
deed of trust, lease, license, agreement, understanding, law, ordinance, rule or
regulation or any order, judgment, or decree to which Purchaser is a party or by
which it may be bound or affected. Purchaser has full power and authority to
enter into this Agreement and to carry out the transactions contemplated hereby,
all proceedings required to be taken by Purchaser to authorize the execution,
delivery, and performance of this Agreement and the agreements relating hereto,
have been properly taken and this Agreement constitutes a valid and binding
obligation of Purchaser.
8. CHOICE OF LAWS. This Agreement and all amendments thereof shall be
governed by and construed in accordance with the law of the state of Florida
applicable to contracts made and to be performed therein.
<PAGE>
9. LITIGATION. Any controversy or claim arising out of or relating to this
agreement or the breach or validity thereof shall be settled by litigation and
adjudicated pursuant to the law of Florida with such litigation being held in
Broward County, Florida.
10. MISCELANEOUS CONDITIONS.
a. Any and all, preexisting, employment contracts of Seller shall be
honored for their duration by Buyer, its agents, and any and all
corporate entities or affiliates.
b. The preexisting contractual obligation of Seller for the purchase of
leads from which they generate profits shall be honored by the Buyer and
any of its affiliates, agents, and entities.
c Should the Seller's gross revenues of new business not increase its
preexsisting revenues by 20% at the end of the first year from the date
of this Purchase the Seller shall have a 15 day period to void this
contractual agreement by means of certified written notification to the
Buyer and the return of all proceeds the Seller has received as purchase
price of this Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed as of the, day and year first above
Written.
[Seller]
By ___________________
Date ________________
[Purchaser]
By ___________________
Date _________________
<PAGE>
E.
(THIS IS AN EXAMPLE OF ONE OF NINE SEPARATE PURCHASE AGREEMENTS TO THE
"ALLIANCE GROUP" WHICH CONSISTED OF NINE SEPARATE INDIVIDUAL PARTNERSHIP)
AGREEMENT
THIS AGREEMENT made on OCTOBER 3, 1998 by and between FIRST FLORIDA
COMMUNICATIONS INC (FFCI) hereinafter called "First Party; and TWIN CITIES SMR
hereinafter called "Second Party".
WITNESSETH
WHEREAS:
(i) The First Party is a publicly traded communications corporation with
the intent, desire, and aspiration to acquire other corporate entities,
corporations, businesses, and equities to add to its value, equity,
marketability, and revenues for, the benefit of its stockholders.
(ii) The Second Party is a partnership, which owns a license, equipment,
and lease for a 220 MHz Specialized Mobile Radio System (SMR) which is site
specific pursuant to FCC rules and regulation.
(iii) The First Party has agreed purchase from the Second Party and the
Second Party has agreed to disperse, assign, convey, transfer and devise
ownership of all its equities, licenses, leases, and equipment for the SMR
pursuant to the terms, conditions and considerations as are set forth herein.
NOW, THEREFORE, or and in consideration of the mutual covenants and promise
contained herein as well as for other good and valuable consideration as
hereinafter provided, the parties agree as follows:
<PAGE>
1. PROPERTIES PURCHASED. (A) The First Party shall hereby purchase the
license owned and in the name of the Second Party for its 220 MHz Specialized
Mobile Radio System (SMR). (B) Included in the sale of the license owned by the
Second Party, as mentioned above, will be the sole and exclusive right to the
use of said license on the site prescribed by said license as regulated by the
FCC, the tower lease for said license all equipment on and used for said tower
owned or leased by the Second Party, and any and all other equities, assets,
values, and properties whether real or personal owned by or in the name of the
Second Party. (C) As a part of this purchase, the First Party shall receive all
liquid assets held by the Second Party in any and all accounts as of September
1, 1998.
2. CONDITION OF PROPERTY PURCHASED. The property purchased by the First
Party shall be free of any encumbrance or lien. All equipment shall be in
working order and sufficient for the purpose in which it was intended. All
leases shall be held current and paid through the date of final transfer of all
property.
3.COMPENSATION BY FIRST PARTY. For the properties purchased the
Paragraph 1 the First Party shall pay the Second Party as follows:(A) The First
Party shall pay to the Second Party the sum of TWO HUNDRED THOUSAND
($200,000.00) DOLLARS in the form of common stock in FFCI which shall be
restricted for one year from, the date of final transfer said stock shall be
valued at the lesser of SEVEN ($7.00)DOLLARS per share or the asking/offering
price on the last business day prior to the execution of this Contractual
Agreement. (B) For each dollar of liquid assets owned by the Second Party,which
pursuant to paragraph I are to be conveyed to the First Party, the First Party
shall issue the Second Party an equivalent amount of debenture bearing interest
at the rate of 8% per annum, all due and payable in 12 months from the date of
final transfer. The debenture will be convertible after twelve months into
common shares of FFCI stock at a discount of 30% from the publicly traded market
price on the date of conversion.
4. DEBTS OWED BY THE SECOND PARTY. Any and all debts owed by the Second
Party shall be paid in full from assets other than the properties in this Sales
Agreement. The First Party shall take from the Second Party all properties
mentioned, in paragraph 1 free from any debt, indenture, lien, or any other
encumbrance of any type of kind at the time of transfer.
<PAGE>
5. DISCLOSURE OF ASSETS BY SECOND PARTY. The Second Party shall present
to the First Party copies of all leases, for said towers, license sites, and any
and all equipment which may have been leased; partnership bank statements for
the past three months, and any and all notices of debt on or before October 3,
1998.
6. RELEASE OF LIABILITY. The First Party shall be free of any and all
liability and held harmless of any and all acts of the Second Party.
7. BINDING EFFECT. All the terms and provisions of this agreement shall
be binding upon, inure to the benefit of and be enforceable by the parties
hereto and their legal representatives, successors and assigns. This contractual
agreement shall be in effect beyond the life of the parties and may become a
part of either party's estate.
8. VIOLATION AND ENFORCEMENT. If it becomes necessary for either party
take legal or other action to enforce this agreement, the party losing or
nonconforming party shall be responsible for any and all costs, expenses, and
attorney's fees.
9. DATE OF EXECUTION AND CLOSING. This Contractual Agreement shall be
deemed fully executed when signed by the designated parties below on or before
October 3,1998, which shall, be deemed the date of execution. All documents,
releases, lease and monies shall be transferred between the parties on or before
SATURDAY, October 10, 1998, which shall be deemed the date of closing. Any
documents necessary to effectuate said transfers by either party shall be done
on or about the closing date.
10. The Alliance addendum is incorporated herein.
For FFCI
PAUL RICHARD BELL
Position - C.E.O.
STATE OF FLORIDA )
)
COUNTY OF BROWARD)
<PAGE>
I HEREBY CERTIFY that on this day, before me, an officer duly authorized in the
State aforesaid and in the County aforesaid, to take acknowledgments, personally
appeared DR. PAUL RICHARD BELL to me personally known or by proof of PERSONALLY
KNOWN to be the person describe in and who executed the foregoing instrument
consisting of 6 pages and he acknowledged before me that the executed the same.
WITNESS my hand and official seal in the County and State last aforesaid this 1
day of October 1998.
Notary Public
My Commission expires:
FOR: Twin Cities SMR
Sig.
Print
Position - Managing Partner
Sig.
Print
Position -
STATE OF )
--------------------
)
COUNTY OF )
--------------------
I HEREBY CERTIFY that on this day, before me, an
officer duly authorized in the State aforesaid and in the County aforesaid to
take acknowledgments, personally appeared
personally known or by proof of __________________________________________ to be
the person(s) described in and who executed the foregoing instrument consisting
of 6 pages and he acknowledged before me that he executed the same.
WITNESS my hand and official seal in the County and State last aforesaid, this
___________ day of ____________ 19 ___ .
Notary Public
My Commission expires:
<PAGE>
F.
(THIS IS AN EXAMPLE OF ONE OF THIRTY FIVE STOCK PURCHASE AGREEMENTS TO THE
STOCK HOLDER OF AMERICAN WIRELESS - THESE WERE EXECUTED TO ALL STOCK
HOLDERS OF AMERICAN WIRELESS)
STOCK PURCHASE AGREEMENT
AGREEMENT dated 8 JANUARY, 1999 , by and among JAMES F. HALEN an
individual (hereinafter "Seller") whose address is 964 CEDAR KNOLLS CEDAR CITY
UTAH 84720 being a stock holder of AMERICAN WIRELESS, INC. d/b/a SKYVIEW
TECHNOLOGIES, (hereinafter "AMERICAN") which is a Utah corporation having its
principal office at 845 e. Skyline Drive, St. George, Utah, and FIRST FLORIDA
COMMUNICATIONS, INC., (hereinafter "Purchaser"), a Florida corporation having
its principal office at 5635 S. University Drive, Davie, Florida.
WITNESSETH:
In consideration of the mutual covenants and agreements hereinafter set
forth, the parties hereby agree as follows:
1. PURCHASE OF STOCK. Subject to and upon the terms and conditions set
forth in this Agreement, Seller in consideration as set forth herein agrees to
sell, transfer, and deliver his/her common stock of AMERICAN and its
affiliates/subsidiaries for a total number of 100,000 shares to FFCI free of any
and all encumbrances or restrictions except as presently exist in the bylaws of
AMERICAN.
2. PURCHASE PRICE.
(a) In consideration of the sale and transfer and delivery of the
Seller's stock to Purchaser; Purchaser will, in full payment thereof, deliver to
the Seller common stock of FFCI restricted for one year from the date of receipt
of Seller's stock FFCI stock.
(i) Seller shall receive FFCI common stock restricted for one
year from the date of issuance based on a value of $7.00 per share with AMERICAN
common stock based on a value of $1.00 per share. Between the date of this
Agreement and February 12, 1999, should the ask price of FFCI stock not have
reached $7.00 or more, the Seller will be entitled to Warrants valued at the
difference between the highest ask price of FFCI stock and $7.00.
<PAGE>
(ii) The stock certificate(s) of FFCI stock shall be made out by
FFCI's transfer agent and corporate counsel in the names of such parties as are
requested by the Seller after they have submitted all necessary information.
(iii) Exchange of stock shall take place within two weeks from
the date of this executed Agreement.
3. COVENANTS OF PURCHASER TO SELLER:
(1) Purchaser agrees that AMERICAN shall retain all funds and
assets necessary to continue its normal course of business
and FFCI will be responsible within the course of prudent
business decisions to provide the funding of AMERICAN's
previously anticipated business growth on a timely basis.
(b) Purchaser agrees the Board of Directors of AMERICAN shall
remain intact with said Board of Directors being under the
direction of FFCI's Board of Directors.
(c) One member of the current Board of Directors of AMERICAN
shall have a seat on the Board of Directors of FFCI.
(d) The current management of AMERICAN shall remain intact
under the direction of FFCI.
4. COVENANTS OF SELLER TO PURCHASER: The Seller's stock in AMERICAN also
incorporates Seller's ownership of any and all affiliates, subsidiaries,
or partnerships of any type of kind to AMERICAN.
5. TOTALLITY OF AGREEMENT. This Agreement shall constitute any and all
covenants, warranties, or provisions of this Purchase Agreement.
AGREED TO THIS 8TH day of JANUARY, 1999.
SELLER FOR FFCI:
C.E.O.
Vice-President
<PAGE>
G.
PURCHASE AGREEMENT
THIS AGREEMENT made on OCTOBER 15,1998 by and between FIRST FLORIDA
COMMUNICATIONS, INC. (FFCI),hereinafter called "First Party; and PARADISE
INTERNATIONAL CONNECTION, INC., hereinafter called "Second Party".
WITNESSETH
WHEREAS:
(i) The First Party is a publicly traded communications corporation with
the intent, desire, and aspiration to merge into its corporate entity other
corporations and businesses to add to its value, equity, marketability, and
revenues for the benefit of its stockholders.
(ii) The Second party is a paging and cellular corporation including but
limited to 3 paging and cellular stores located in the Miami/Ft. Lauderdale,
Florida area. Part of its ongoing business plan to continue to set up additional
paging stores for a substantial fee.
(iii)The First Party has agreed to disperse, assign, convey, transfer,
and devise ownership of his personal stock to the aforementioned, corporations
for the benefit of FFCI and its stockholders in exchange for such considerations
as are set forth herein.
NOW, THEREFORE, for and in consideration of the mutual covenants and
promises contained herein as well as for other good and valuable consideration
as hereinafter provided, the parties agree as follows
1. PURCHASE OF ASSETS. FFCI agrees to purchase in its entirety PARADISE
INTERNATIONAL CONNECTION, INC.. including but not limited to all property,
whether tangible or intangible; all assets of any type and nature; accounts
receivable; client lists; contracts and agreements; inventory and stock;
equipment and furnishings; trademarks and symbols; and good will, for a purchase
price of $350,000 which was agreed to based upon the warranty of Seller that the
gross annual revenues were $280,000. Purchase price payable in shares of common
stock, $8.00 RS/OP par value per share, totaling 43,750 RS/OP shares of FFCI
(the "Stock") upon the closing of this transaction, which shall take place at
the offices of FFCI no later than 10 days from the date this Agreement is
executed. These shares are restricted from sale or trade from the date of
closing for a period of one year.
2. ASSUMPTION OF LIABILITIES. FFCI shall assume those business debts and
liabilities that have been made known to FFCI as listed on Schedule 1 and agreed
to by FFCI as signified by the execution of that Schedule. Any debts not
accepted or listed on Schedule 1 shall be the sole responsibility of the Seller.
3.WARRANTIES AND GUARANTEES. Should any of the following warranties or
guaranties not be adhered to, the injured party shall have full recourse to
unilaterally modify any necessary terms of this Agreement to make themselves
whole.
A. Paradise International Connection, Inc. warrants as follows:
(1) It is a corporation duly organized in the
State of Florida, with corporate power to
execute this agreement and discharge its
obligations hereunder.
(2) It indemnify, defend and save FFCI from and
against any and all loss, damages, costs,
and expenses (including attorney's fees)
that FFCI may suffer as a result of any
claim or action relating to the assets
purchased from them and relating to the
period of time prior to the date FFCI takes
over the operation of Paradises's business
as provided herein.
(2) Paradise is duly qualified and in good
standing in each jurisdiction
<PAGE>
in which it is presently conducting business
and has the requisite corporate power to
own, lease, and utilize its assets,
properties, and business and to carry on its
business as such business is presently being
conducted.
(3) The performance, deliver, and performance by
Paradise of. this Agreement, and the
consummation by Paradise of the transaction
contemplated hereby, has been duly
authorized by all requisite corporate
action. This Agreement has been duly and
validly executed and delivered by Paradise
and constitutes a valid and binding
obligation of Paradise enforceable against
Paradise in accordance with its terms.
(5) No consent, authorization or approval of, or
waiver or exemption by, or filing with, any
other person is required in connection with
the execution, delivery, or performance by
Paradise of this Agreement or the
consummation by Paradise of the transaction
contemplated hereby.
(6) Seller warrants that, minus any major
unforeseen interference with business
operations, the annual gross revenues shall
be $280,000l.
B. FFCI warrants as follows:
(1) It is a corporation duly organized in the
State of Florida, with corporate power to
execute this Agreement.
(2) FFCI has secured or established exemption
form registration or registered its shares
under all applicable federal and state laws
in such manner that the issuance and sale of
its shares of stock to Paradise for the
consideration provided in this Agreement
shall satisfy all such legal requirements.
(3) FFCI has met all requirements of Florida law
applying to the issuance and transfer of
FFCI's Stock in exchange for all of the
assets of Paradise; and that Paradise shall
not be obligated to transfer its assets or
be liable to FFCI unless and until all RS/DP
of the requirements of Florida law relating
to such sale and issuance have been met;
(4) FFCI is duly qualified and in good standing
in each jurisdiction in which it is
presently conducting business and has the
requisite corporate power to own, lease, and
utilize its assets, properties, and business
and to carry on its business as such
business is presently being conducted.
(4) The performance, deliver and performance by
FFCI of this Agreement, and the consummation
by FFCI of the transaction contemplated
hereby, has been duly authorized by all
requisite corporate action. This Agreement
has been duly and validly executed and
delivered by FFCI and constitutes a valid
and binding obligation of FFCI enforceable
against FFCI in accordance with its terms.
<PAGE>
(5) No consent, authorization or approval of, or
waiver or exemption by, or filing with, any
other persons is required in connection with
the execution, delivery, or performance by
FFCI of this Agreement or the consummation
by FFCI of the transaction contemplated
hereby.
4. BINDING EFFECT. All the terms and provisions of this agreement shall
be binding upon, inure to the benefit of and be enforceable by the parties
hereto and their legal representatives, successors and assigns. This contractual
agreement shall be in effect beyond the life of the parties and may become a
part of either party's estate. If for any reason it is determined by a Court of
Law that any portion of this Agreement is not legally binding this will have no
effect on the remaining provision of this Agreement.
5. VIOLATION AND ENFORCEMENT. If it becomes necessary for either party
take legal or other action to enforce this agreement, the party losing or
nonconforming party shall be responsible for any and all costs, expenses, and
attorney's fees.
IN WITNESS WHEREOF, I have hereunto set my hand and seal this 15 day of
OCTOBER , 1998 signed, sealed and delivered in presence of:
FOR PARADISE INTERNATIONAL CONNECTION, INC.
(sign)
MR. EDMOND PUDLEINER
(sign)
SHARON PUDLEINER
(sign)
FOR FIRST FLORIDA COMMUNICATION INC.
<PAGE>
(sign)
PAUL RICHARD BELL, JR.
POSITION
COUNTY OF BROWARD)
I HEREBY CERTIFY that on this day, before me, an officer duly authorized
in the State aforesaid and in the County aforesaid to, take acknowledgments,
personally appeared EDUMUND PUDLEINER, SHARON PUDLEINER, MR. PAUL RICHARD BELL,
JR. AND MR. RONALD STUL to me personally known or by proof of to be the person
described in and who executed the foregoing instrument and he acknowledged
before me that he executed the same.
WITNESS my hand and official seal in the County and State last aforesaid this 15
day of OCTOBER 1998.
Notary Public
My Commission expires:
SCHEDULE 1
1. AMERICAN EXPRESS CHARGE FOR CAPITAL FINANCE $10,483.99
2. PREPAID PHONE CARD $727.50
3. G.E. CAPITAL EQUIPMENT $631.42
4. AIRTIME BILLS (approx pr. Mth) $4,000.00
<PAGE>
Attorney at Law
<TABLE>
<CAPTION>
<S> <C> <C>
MEMBER OF
521 S. Andrews Ave., Suite 6 FLORIDA BAR Telephone (954) 524-2506
Ft. Lauderdale, FL 33301 WASHINGTON D.C. BAR Facsimile (954) 524-2502
</TABLE>
January 13, 1999
Sharon and Ed Pudleiner
2910 Devonwood Ave.
Miramar, FL 33125
RE: Stock Certificates
Dear Sharon and Ed:
Pursuant to your request to review all outstanding bills that were paid
by FFC1 on behalf of Paradise prior to the merger, we have tallied and
re-tallied all receipts and bills that we have to date and come to a final
figure of $5,887.26 as compared to the $12,75 5.67 figure form which stock was
deducted instead of requiring you to pay those outstanding bills. This leaves a
difference of $6,868.41 worth or stock at $8 per share or 859 shares. Please
list the name hereof the person or persons that you would like the. certificate
to be named in with both the name, address, and SS#.
As completion of this requested information shall constitute acceptance
of the final shares of stock, the matter of outstanding stock owed for the
acquisition of Paradise shall be resolved.
NAME: RON SCHULMAN
ADDRESS: 1483 FAIRWAY RD. PEMBROKE PINES, FL 33026
SS#: ###-##-####
DATE: 1-13-99 850 SHARES
NAME: JONATHAN SCHULMAN
ADDRESS: 37 KENILWORTH RD.
SS#: ###-##-####
DATE: 1-13-99 9 SHARES
<PAGE>
H.
(THIS IS AN EXAMPLE OF ONE OF FOUR STOCK PURCHASE AGREEMENTS TO THE
STOCK HOLDER OF LANSOURCE - THESE WERE EXECUTED TO ALL STOCK HOLDERS OF
LANSOURCE)
STOCK/ASSET PURCHASE AGREEMENT
AGREEMENT DATED JUNE 5, 1999, BY AND AMONG LANSOURCE, INC. A UTAH
CORPORATION WHOSE ADDRESS IS 1071 EAST 100 SOUTH SUITE D-2, ST. GEORGE, UTAH
84770 AND THE STOCK HOLDERS THEREOF, MACK STAUFFER, NICK BELNAP, TRACY PECK, AND
JEFF CARPENTER (HEREINAFTER "SELLERS") AND FIRST FLORIDA COMMUNICATIONS, INC.,
(HEREINAFTER "PURCHASER"), A FLORIDA CORPORATION HAVING ITS PRINCIPAL OFFICE AT
2161 E. COMMERCIAL BLVD. 2ND FLOOR, FT. LAUDERDALE, FLORIDA 33308
WITNESSETH:
IN CONSIDERATION OF THE MUTUAL COVENANTS AND AGREEMENTS, HEREINAFTER SET
FORTH, THE PARTIES HEREBY AGREE AS FOLLOWS:
1. PURCHASE AND SALE OF BUSINESS AND ASSETS. SUBJECT TO AND UPON THE
TERMS AND CONDITIONS SET FORTH IN THIS AGREEMENT, SELLER WILL SELL, TRANSFER,
CONVEY, ASSIGN, AND DELIVER TO PURCHASER AND PURCHASER WILL PURCHASE, AT THE
CLOSING HEREUNDER, ALL OF THE BUSINESS, ASSETS, INVENTORY, PROPERTIES,
OUTSTANDING RECEIVABLES GOODWILL, AND RIGHTS OF SELLER AS A GOING CONCERN OF
EVERY NATURE, KIND, AND DESCRIPTION, TANGIBLE AND INTANGIBLE, WHERESOEVER
LOCATED AND WHETHER OR NOT CARRIED OR REFLECTED ON THE BOOKS AND RECORDS OF
SELLER (HEREINAFTER "BUSINESS ASSETS") (CLEAR OF ALL LIABILITIES OBLIGATIONS,
LIENS, AND ENCUMBRANCES EXCEPTING ONLY THOSE LIABILITIES AND OBLIGATIONS WHICH
ARE EXPRESSLY TO BE ASSUMED BY PURCHASER HEREUNDER, AND THOSE LIENS AND
ENCUMBRANCES DECURING THE SAME WHICH ARE SPECIFICALLY DISCLOSED HEREIN OR
EXPRESSLY PERMITTED BY THE TERMS HEREOF.)
2. PURCHASE OF STOCK. SUBJECT TO AND UPON THE TERMS AND CONDITIONS SET
FORTH IN THIS AGREEMENT, SELLER IN CONSIDERATION AS SET FORTH HEREIN AGREES TO
SELL, TRANSFER, AND DELIVER HIS/HER COMMON STOCK OF LANSOURCE, INC. FOR A TOTAL
NUMBER OF 85,715 SHARES TO FFCI FREE OF ANY AND ALL ENCUMBRANCES OR
RESTRICTIONS.
3. PURCHASE PRICE.
(A) IN CONSIDERATION OF THE SALE AND TRANSFER AND DELIVERY OF THE
SELLER'S BUSINESS ASSETS AND STOCK TO PURCHASER: PURCHASER WILL IN FULL PAYMENT
THEREOF, DELIVER TO THE SELLER COMMON STOCK OF
<PAGE>
FFCI RESTRICTED FOR ONE YEAR AT A VALUE OF $400,000 AND TWO YEARS AT A VALUE OF
$200,000 FROM THE DATE OF RECEIPT OF STOCK. THE PURCHASE OF SAID STOCK IS FOR
THE SOLE PURPOSE OF PURCHASER ACQUIRING ALL ISSUED STOCK AND BUSINESS ASSETS OF
SELLER FOR A TOTAL SALES PRICE OF $600,000.
(B) THE PER SHARE VALUE OF FFCI STOCK SHALL BE BASED UPON THE VALUE OF
$7.00 PER SHARE.
(C) THE STOCK CERTIFICATES OF FMI STOCK SHALL BE MADE OUT BY FFCI'S
TRANSFER AGENT AND CORPORATE COUNSEL IN THE NAMES OF SUCH PARTIES AS ARE
REQUESTED BY THE SELLER AFTER THEY HAVE SUBMITTED ALL NECESSARY INFORMATION.
COVENANT5 OF PURCHASER TO SELLER
(a) THE CURRENT MANAGEMENT OF LANSOURCE SHALL REMAIN INTACT UNDER THE
DIRECTION OF FFCI.
4. TOTALLITY OF AGREEMENT. THIS AGREEMENT SHALL CONSTITUTE ANY AND ALL
COVENANTS, WARRANTIES, OR PROVISIONS OF THIS PURCHASE AGREEMENT
AGREED TO THIS 7 DAY OF JUNE, 1999.
SELLER: FOR FFCI:
------------------------------
MARK STAUFFER C.E.O.
------------------------------
NICK BELNAP
------------------------------
TRACY PEEK
------------------------------
STOCK POWER DIRECTIONS
<PAGE>
THIS STOCK POWER IS NECESSARY TO FINALIZE THE COMPLETE EXECUTION AND
TRANSFER OF THE STOCK EXCHANGE IN WHICH YOU CONTRACTUALLY AGREED TO TRANSFER
YOUR SHARES OF STOCK IN LANSOURCE TO FIRST FLORIDA COMMUNICATIONS, INC. (FFCI)
IN EXCHANGE FOR FIRST FLORIDA COMMUNICATIONS STOCK.
THEREFORE PLEASE FILL OUT THE BOTTOM, ATTACH YOUR AMERICAN STOCK
CERTIFICATE AND YOU CAN DELIVER IT TO US WHEN WE F DELIVER YOUR CERTIFICATES TO
YOU AT THE END OF THIS WEEK.
STOCK POWER
ON THIS 8TH DAY OF JUNE, 1999, I/WE, JEFF CARPENTER WHOSE SS# (`S)
IS/ARE ###-##-#### RESIDING AT 2081 JACOB STREET, SANTA CLARA, UT 84765 DO
HEREBY SELL, ASSIGN, TRANSFER, AND CONVEY TO FIRST FLORIDA COMMUNICATION, INC.
WHOSE ADDRESS IS FIRST FLORIDA COMMUNICATIONS, INC., 2161 E. COMMERCIAL BLVD.-
2ND FLOOR, FT. LAUDERDALE, FL 33308 OUR 2,500 SHARES OF LANSOURCE, INC. STOCK
FOR GOOD AND EQUITABLE CONSIDERATION.
I/WE DO HEREBY DIRECT THE RECORD KEEPERE OF LANSOURCE, INC. TO RECORD ON
THEIR BOOKS THIS TRANSFER INTO THE NAME STATED ABOVE, THAT BEING FIRST FLORIDA
COMMUNICATIONS, INC.
Dated:________________ Signature ______________________________
Dated:________________ Signature_______________________________
EXHIBIT - 4.3
EX - 4.3
AGREEMENT
(EARTH STATION SERVICES)
THIS AGREEMENT ("Agreement"), is made and entered effective the 30th day
of March, I 999, between JONES EARTH SEGMENT, INC., a corporation organized
under the laws of Colorado, and having its principal place of business at 9697 E
Mineral Avenue, Englewood, Colorado 80112 ("Jones") and First Florida
Communication, Inc., a Florida corporation, and having its principal place of
business at 2161 East Commercial Blvd., 2nd Floor, Fort Lauderdale, Florida
33308 d/b/a MB Broadcasting (the "User).
WlTNESSETH:
WHEREAS, Jones desires to provide to User and User desires to obtain
from Jones certain earth station and other services; and
WHEREAS, the parties desire to set forth herein the terms and conditions
under which said earth station services will be provided;
NOW, THEREFORE, the parties, in consideration of the mutual covenants
herein expressed, agree as follows:
ARTICLE I THE SERVICES
1.1 Jones agrees to provide and User agrees to take and pay for the
earth station and other services as described in Exhibit A to this Agreement
(the "Services") in accordance with the terms and conditions set forth in this
Agreement and the specifications for performance of the Services set forth in
Exhibit B to this Agreement (the "Performance Specifications").
ARTICLE 2. PRICE AND PAYMENT
2.1 For the Services, User shall make the payments required of it
pursuant to the Transponder Capacity Agreement of even date herewith between
Jones Space Holdings. Inc. and MB Broadcasting and First Florida Communication.
Inc. (the "Capacity Agreement"). No additional amount is required under this
Agreement, except as set forth on Exhibit A.
<PAGE>
ARTICLE 3. TERM
3.1 The term of this Agreement shall begin on the date first-above
written and shall terminate upon the termination of the Capacity Agreement.
ARTICLE 4. LIMITATIONS OF LIABILITY
4.1 EXCEPT AS EXPRESSLY OTHERWISE PROVIDED IN THIS ARTICLE, JONES SHALL
HAVE NO LIABILITY FOR DAMAGES OR LOSSES ARISING OUT OF ITS FAILURE OR INABILITY
TO PROVIDE THE SERVICES IN ACCORDANCE WITH THIS AGREEMENT. JONES' SOLE LIABILITY
FOR DAMAGES OR LOSSES ARRISING OUT OF MISTAKE,, OMISSIONS, INTERRUPTI()NS,
DELAYS? ERRORS OR DEFECTS OR ANY KIND WITH RESPECT TO ITS PERFORMANCE OF THIS
AGREEMENT OR THE PROVISION OF THE SERVICES OR ANYTHING DONE IN CONNECTION
THEREWITH, REGARDLESS OF WHETHER OCCASIONED BY ITS OWN NEGLIGENCE, SHALL BE
LIMITED TO A REFI JND OR WAIVER AS THE CASE MAY BE, OF THE APPLICABLE CHARGES
UNDER ARTICLE 5 FOR ANY PERIOD THAT SERVICES ARE NOT PROVIDED. CREDITS FOR
INTERRUPTIONS, OUTAGES OR ERRORS SHALL BE DETERMINED IN ACCORDANCE WITH ARTICLE
5 OF THIS AGREEMENT.
4.2 Except as provided in Article 9 of this Agreement, neither party
shall be liable, in connection with this Agreement, or the arrangements
contemplated hereby, for any indirect, incidental, consequential, special or
other similar damages, whether in contract or tort, including but not limited
to, damages resulting from loss of actual or anticipated revenues or profits, or
loss of business, customers or good will.
4.3 Jones shall not be liable for any damages or losses due to the fault
of User or of any third party or the failure or unavailability of satellites,
transponders, facilities, services. software or equipment famished to User or
Jones by any other person which may be used in conjunction with the facilities,
services or equipment of Jones, or any act or omission of any such other person.
In addition, Jones shall not be Liable if there is a cessation of the Services
required by governmental action or if required by the satellite operator
ARTICLE 5. CREDITS FOR INTENTIONS OUTAGES AND ERRORS
5.1 User mill receive a credit, as set forth below, for Interruptions,
Outages or Errors. An Outage or Interruption shall be a failure of the Services
to
2
<PAGE>
meet the Performance Specifications and said failure precludes the use of the
Services for their intended purposes for a period of fifteen (15) minutes or
more. An Outage or Interruption does not include, and there shall no be credit
for, satellite service interruptions caused by the (i) User or User-provided
facilities; (ii) sun transient outage; (iii) rain fade, or (iv) any of the
circumstances set forth in Section 4.3. An Error shall be any material mistake
or omission in the provision of the Services by Jones and which is not an Outage
or Interruption.
5.2 The length of the Interruption, Outage or Error shall be measured
from the time provision of the Services is interrupted. For the purpose of
calculating the credit, a month is considered to have shiny (30) days.
a. INTERRUPTIONS' OUTAGES OR ERRORS OF 24 HOURS OR LESS
----------------------------------------------------
Credit will be allowed as follows:
LENGTH OF TIME CREDIT
Less than 15 minutes $ 0
15 Mins. up to but not including 3 hours $ 292
3 hrs. up to but not including 6 hours $ 583
6 hrs. up to but not including 9 hours $ 875
9 hrs. up to but not including 12 hours $1,167
12 hrs. up to but not including 15 hours $1,458
15 hrs. up to 24 hr. inclusive $2,333
Two Or more Interruptions, Outages or Errors of fifteen ( 15) minutes or
more, during any period up to but not including three (3) hours, shall be
considered as one Interruption, Outage or Error, as the case may be.
b. INTERRUPTIONS OUTAGES OR ERRORS OVER 24 HOURS
---------------------------------------------
Credit will be allowed in one-fifth (l/5) day multiples for each
three (3) hour period of Interruption. Outage, Error or Faction thereof. No more
than one full day's credit will be allowed for any period of twenty-four (24)
hours.
c. An allowance will not be made under this Agreement where
the Interruption, Outage or Error is a result of, or attributable in whole or in
part, to:
(i) Users negligence or willful act, or the negligence or
willful act of its officers, directions, agents, employees, subsidiaries,
parents, affiliates, customers and viewers, or any of them;
3
<PAGE>
(ii) The failure of channels, transmission or equipment, if any,
provided by User or by any third party;
(iii) Testing, modification or installation of compression
equipment; provided that if the foregoing should cause an Interruption which
exceeds three (3) hours, Section 5.2a or 5.2b, as the case may be, would be
applicable to the excess period.
(iv) Any interruption of service caused by satellite or
transponder related reasons as contemplated by the Capacity Agreement which
allows for a credit to IJser under the Capacity Agreement.
5.3 In the event of an Interruption, Outage or Error, Jones will use its
commercially reasonable efforts to restore service as soon as feasible.
ARTICLE 6. FORCE MAIEURE
6.1 Neither party shall be liable TO THE other for any failure of or
delay in performance hereunder due to causes beyond its reasonable control.
These causes include but are not limited to acts of God, fire, flood or other
natural catastrophes, the need to comply with any law or any rule, order,
regulations or direction of the United States Government, or of any other
government, including state and local governments having jurisdiction over
either party, or of any department, agency, commission, bureau, court or other
instrumentality thereof, or of any civil or military authority, national
emergencies, insurrections, riots, acts of ever, quarantine restrictions,
embargoes, or strikes, lockouts, work stoppages or labor difficulties.
ARTICLE 7. CONFIDENTIALITY AND NONDISCLOSURE
7.1 Both parties shall hold in strict confidence and neither party shall
disclose to third parties the prices, payment terms and other material terms and
conditions of this Agreement, without the prior written consent of the other
party. The restrictions on disclosure hereunder shall not apply to disclosures
to a party's parent, subsidiaries or companies under common control with a party
("affiliates"), or to their respective EMPLOYEES, agents, independent auditors
or legal counsel, PROVIDED, THAT each party's parent, subsidiaries and
affiliates (including their respective employees, agents, independent auditors
Or legal counsel) shall be subject to the same restrictions on disclosure to
third parties as apply to the party itself.
7.2 If a party discloses to the other party any information which it
considers proprietary, the disclosing party shall identify such information as
4
<PAGE>
proprietary by marking it clearly as proprietary information. Any proprietary
disclosure to either party if made orally, shall be promptly confirmed in
writing and identified as proprietary information. Any such information
disclosed under this Agreement shall be used by the recipient thereof only for
the purpose of its performance under this Agreement. Neither party shall be
liable for disclosure or use of such information marked as proprietary
information as provided above which.
(i) is or becomes available to the public from a source other
than the receiving party before or during the period of this Agreement; or
(ii) is released without restrictions in writing by the
disclosing party; or parties; or
(iii) is lawfully obtained by the receiving party from a Bird
party or
(iv) is known by the receiving party prior to such disclosure; or
(v) is at any time developed by the receiving party completely
independently of any such disclosure or disclosures from the disclosing party.
7.3 A party shall not be liable for the disclosure of any information if
such disclosure is made pursuant to (i) judicial action or decree or (ii) any
requirement of any Government or any agency or department thereof, having
jurisdiction over such party, or (iii) a public or private offering of
securities by such party or an affiliate thereof, provided. that such party to
the extent reasonably practicable shall have given the other party notice prior
to such disclosure.
7.4 Neither party shall issue a public notice or a news release
concerning this Agreement and the transactions contemplated hereby without the
approval of the other.
ARTICLE 8. PROGRAMMING CONTENT
8.1 User agrees that it will not itself use the Services, and will not
authorize or permit others to use the Services to transmit unlawfu1
prograrnrning of any nature. User further agrees that Jones shall have the right
and without liability to User, to interrupt, discontinue or terminate The
Services for any breach of the foregoing provision. Jones shall give User notice
by facsimile at least twenty-four (24) hours before any such interruption,
discontinuance or termination
5
<PAGE>
8.2 Jones may terminate, prevent or restrict any programming using the
Services as a means of transmission if such actions are at the direction of
governmental agency or are taken as a result of criminal, civil or
administrative proceedings or investigations based upon the content of such
programming.
ARTICLE 9. INDEMNIFICATION
9.1 Jones shall be indemnified and held harmless by User from and
against all loss liability. damage and expense, including reasonable counsel
fees and disbursements ,arising cut of or due to:
(i) Claims for libel, slander, infringement of copyright
or other intellectual property rights arising from
material received or transmitted by Use; or
(ii) Any other claim arising from any use of the Services
by User,
(iii) Breach by User of the provisions of Section 8.1 of
this Agreement
9.2 User shall promptly defend any claims against Jones pursuant to this
Article with counsel of the User's choice at its own cost and expense. Jones
shall cooperate with, and assist as reasonably requested by, User in the defense
of any such claim, including the settlement thereof (with User being responsible
for all costs and expenses of defending such claim or making such settlement);
PROVIDED, HOWEVER that (i) User will not without the consent of Jones. settle or
compromise any claim or consent to any entry of judgment which does not include
the giving by the claimant or the plaintiff to Jones of an unconditional release
from all liability with respect to such claim and (ii) Jones shall be entitled
to participate at its sole expense in support of the User's action in the
defense of any such claim and to employ counsel at Jones' own expense to assist
in the handling of such claim.
ARTICLE 10. NOTICES
10.1 Notice of Interruptions, Outages, Errors, or of other technical or
operational matters requiring immediate attention, shall be given by telephone.
Jones will designate a point or points of contact where User may call on a
7-day-a-week, 24 hour-a-day basis. Any notice given verbally will be confirmed
in writing as soon as practicable thereafter pursuant to the procedures set out
in the following paragraph.
6
<PAGE>
10.2 Except as otherwise provided in Section 9.1, all notices, demands,
reports, orders and requests required hereunder to be given by one party to the
other shall be in writing and deemed to be duly given on the same business day
if sent by electronic means (i e., telex, electronic mail or facsimile) or
delivered by hand during; the receiving party's regular business hours, or on
the date of receipt if sent by pre-paid overnight, registered or certified mail,
and addressed as follows:
If to be given to Jones: with a copy to:
Jones learn Segment, Inc. Legal Department
9697 E Mineral Avenue Jones Intercable, Inc.
Englewood, Colorado 801 lo 9697 E. Mineral Avenue
fax No. (303) 799-4675 Englewood, Colorado 8(~112
Phone No. (303) 792-3111 Fax No. (3()3) 799-1644
Phone No. (303) 792-3111
With a Copy to: If to be given to User:
First Florida Communication, Inc. MB Broadcasting
9161 East commercial Blvd., 2nd Floor 25 West Hilton Drive
Fort Lauderdale, Florida 33308 St. George, Utah 84770
Fax No. (954) 351-9665 Fax No (4353 673-829g
Phone No. (954) 351-9070 Phone No. (43~) 628-04X4
10.3 A party may, on written notice to the other, specify another
address or individual to serve as a point of contact for that party.
ARTICLE 11. GENERAL PROVISIONS
11.1 Nothing contained in this Agreement shall be deemed or construed
to create any rights, obligations or interests in third parties; or to create
the relationship of principal and agent. partnership or joint venture or any
other fiduciary relationship or association. between the parties.
11.2 No failure on the part of either party to notify the other party of
any noncompliance hereunder, and no failure on the part of either party to
exercise its rights hereunder shall prejudice any remedy for any subsequent
noncompliance, and any waiver by either party of any breach or noncompliance
with any term or condition of this Agreement shall be limited to the particular
instance and shall not operate or be deemed to waive any fixture breach or
noncompliance with any term or condition. All remedies and rights hereunder and
those available in law or in equity
7
<PAGE>
shall be cumulative and the exercise by a party of any such right or remedy
shall not preclude Me exercise of any other right or remedy available under this
Agreement in law or in equity.
11.3 This Agreement shall be construed and enforced in accordance with
the internal laws of the State of Colorado. The parties hereby consent to and
submit to the jurisdiction of the federal and state courts located in the State
of Colorado, and any action or suit under this Agreement may be in any federal
or state court with appropriate jurisdiction over the subject matter sitting in
the State of Colorado. 'Lee parties shall not raise in connection therewith, and
hereby waive, any defenses based upon the venue, the inconvenience of the forum,
the lack of personal jurisdiction the sufficiency of service of process in any
such action or suit brought in the State of Colorado.
11.4 All titles and headings in this Agreement are inserted as a matter
of convenience and for reference purposes only.
11.5 This Agreement may be signed in any number of counterparts with the
same effect as if the signatures to each counterpart were upon the same
Agreement.
11.6 This Agreement is subject to all applicable laws and regulations,
including without limitation the Communications Act of 1934 as amended, and the
rules and regulations of the Federal Communications Commission.
11.7 Each party shall bear its respective costs and expenses in
connection with the preparation, execution, delivery and performance of this
Agreement.
11.8 This Agreement, including all exhibits, represents the entire
understanding and agreement between the panics with respect to the subject
matter hereof, supersedes all prior negotiations and agreements between the
parties concerning that subject matter, and can be amended, supplemented or
changed only by a writing which is signed bar both parties.
11.9 Each park represents that all negotiations relative to this
Agreement and the transactions contemplated shall not give rise to any claim,
against the other party for a fender's fee, brokerage commission or similar
payment.
11.10 User shall not assign its rights or obligations under this
Agreement without first obtaining the written consent of Jones. No permitted
assignment or transfer shall relieve User of its obligations hereunder.
8
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this Agreement, effective
on the date first above written.
JONES EARTH SEGMENT, INC
By:
Name
Title
FIRST FLORIDA COMMUNICATION, INC.
By:
Name:
Title:
EXHIBIT - 4.4
EX-4.4
FIRST FLORIDA COMMUNICATIONS, INC.
5625 South University Drive, Dane, Florida
(954) 252-9577 FAX (954) 252-9599
LEASE AGREEMENT FOR TRANSPONDER TIME
This Agreement between Video Catalog Channel (VCC) and First Florida
Communications, Inc. (FFCI) is for the subleasing by VCC for the usage of
certain designated times for FFCI's transponder, the 36 MHz C-band satellite
transponder (Channel 20) on SatCom 3-R. based upon the following terms and
conditions:
For and to the benefit of each party, the parties agree to be mutually bound to
the following terms and conditions:
1. START DATE - If all terms can be met and executed, your start date could be
beginning with the broadcast week 44 beginning with Monday October 25, 1999.
2. TERM - The term will be for the duration of FFCI's lease for the transponder
but will be voidable by either party upon 120 days notice.
3. PAYMENT - Sublease rental paid by VCC to FFCI will be in the amount of
$40,000.00 monthly paid on the first day of Broadcast October 25, 1999, and each
month thereafter, plus an amount equal to Fifteen (15%) Percent of all VCC sales
(net returns, cancellations and credit card fees) to C-band customers who
register as new customers subsequent to VCC's first broadcast on Satcom 3-R paid
on a monthly basis at the end of the first month and each month thereafter.
4. TIME USAGE - VCC will have full usage of the transponder for a period of 18
hours per day, seven days per week. FFCI will have use of the transponder for
the time periods of 5.00 P.M. to 11:00 P M. EST. It is anticipated that
amendments to this time may be forthcoming in which FFCI will need more time
usage of the transponder up to a maximum of an additional 6
<PAGE>
hours which will pro-rationally reduce the sublease rental payments made by VCC.
Such amendments must be presented to VCC at least 30 days in advance.
5. AFFILIATE COVERAGE - Both FFCI and VCC currently have affiliate coverage for
24 hours per day 7 days per wk to air broadcasting over the aforementioned
transponder for which weekly affidavits are available. Both parties will
maintain their current affiliate coverage for the benefit and usage of the other
party. Each party will submit their affiliate lists showing locations, call
numbers and letters, and the number of households each serves one to the other
along with the exchange of weekly affidavits.
6. MODIFICATIONS - Any changes to this agreement must be in writing signed by
the authoritative corporate officers of each corporation.
7. FUTURE RELATIONSIIIPS - It is anticipated that future relationships between
the corporate entities may alter, modify, or void this sublease in part or
totality.
The signatories below have the authority to bind, commit, and execute this
document for and in behalf of their respective corporation/company and that
respective company/ corporation shall become legally bound, obligated,
committed, and a party to the terms set down above.
Date
John W. Pirkle, President Video Catalog Channel, Inc.
Date
Douglas E. Costa, CEO/President First Florida Communications, Inc.
EXHIBIT-4.5
EX-4.5
RECISION AGREEMENT
THIS AGREEMENT between the original owners, operators, and corporate
officers, and investors of LanSource, Inc. (hereinafter "LanSource") and First
Florida Communications, Inc. (hereinafter "FFCI") shall act to shall act to
rescind the contractual agreement between the parties.
STATEMENTS OF FACT:
a. On or JUNE 10, 1999 FFCI purchased all stock of LanSource based at 7 per
share for a total purchase price of $600,000 which was paid in the form of FFCI
restricted common stock totaling 85,714 shares.
b. This purchase was for all assets and equities of LanSource.
c. Stock exchange took place between the parties and Stock Powers were executed
by LanSource giving FFCI full ownership rights to any and all assets and
equities of LanSource.
d. FFCI has invested $18,500.00 towards the existing debts of LanSource since it
was acquired by FFCI.
The parties now agree to rescind this contractual agreement for various business
reasons.
RECISION AGREEMENT.
WHEREFORE THE PARTIES NOW AGREE TO THE FOLLOWING:
1. All stock shall be returned to the original owners.
2. Stock powers shall be executed to return ownership of that stock to the
original owners, operators, and corporate officers, and investors of
LanSource.
3. LanSource shall refund to FFCI a total amount of $18,500.00. This refund
shall be in the way of services, materials, supplies, products or
merchandise at the sole discresion and request of FFCI; should any charges
for the services, materials, supplies, products or merchandise exceed this
figure of $18,500.00 that difference shall be paid in cash by FFCI to
LanSource
4. Should either party fail to uphold this agreement and litigation ensue from
this agreement or the acts of the parties, the losing party shall be
responsible for any and all costs and reasonable attorney's fees of both
parties.
AGREED TO ON THIS 1 DAY OF October 1999
FOR LANSOURCE:
FOR FIRST FLORIDA COMMUNICATIONS, INC.
ILLEGIBLE
EXHIBIT 4.7
TIGER EYE BROADCASTING CORPORATION
3400 LAKESIDE DRIVE, SUITE 500 INVOICE
MIRAMAR, FL 33027 DATE INVOICE #
10/1/99 1758
BILL TO
First Florida Communication, Inc.
Doug Costa
5626-35 S. University Drive
Davie, FL 33328
<TABLE>
<CAPTION>
P.O. NO. TERMS
PREPAY
MARKET DAYS DESCRIPTION RATE AMOUNT
<S> <C> <C> <C> <C>
WIRE 12 Two 3 hour blocks airing from 9 am - 12 50.00 600.00
pm and 11 pm - 2 am (Atlanta) September
23, 24, 25, 26, 27,28, 29, 30, October
1, 2, 3, 4
WADA 55 11 Two 3 hour blocks airing from 9 am - 12 50.00 550.00
pm and 11 pm - 2 am (Charlottesville)
September 24, 25, 26, 27,28, 29, 30
and October 1, 2, 3, 4
WLZE 12 Two 3 hour blocks airing from 9 am - 12 50.00 600.00
pm and 11 pm - 2 am (Ft. Myers)
September 23, 24, 25, 26, 27,28, 29, 30
and October 1, 2, 3, 4
WEEE 7 Two 3 hour blocks airing from 9 am - 12 50.00 350.00
pm and 11 pm - 2 am (Knoxville)
September 28, 29, 30 and October 1, 2,
3, 4
WIMP 4 One 3 hour block airing from 9 am - 12 pm 25.00 100.00
(Miami) October 1, 2, 3, 4
TOTAL
</TABLE>
<PAGE>
TIGER EYE BROADCASTING CORPORATION
3400 LAKESIDE DRIVE, SUITE 500 INVOICE
MIRAMAR, FL 33027 DATE INVOICE #
10/1/99 1758
BILL TO
First Florida Communication, Inc.
Doug Costa
5626-35 S. University Drive
Davie, FL 33328
<TABLE>
<CAPTION>
P.O. NO. TERMS
PREPAY
MARKET DAYS DESCRIPTION RATE AMOUNT
<S> <C> <C> <C> <C>
RENO 7 Two 3 hour blocks airing 9 am - 12 pm 50.00 350.00
and 11 pm - 2 am (Reno)
September 28, 29, 30, and October 1,
2, 3, 4
/s/ Dianne M. Mercer
-------------------------------------
Notary Signature
Notary Name: Dianne M. Mercer
My Commission Expires:
[SEAL]
TOTAL $ 2,550.00
</TABLE>
EXHIBIT-4.8
EX-4.8
LOCAL MULTI POINT DISTRIBUTION SYSTEM
(LMDS)
PRODUCTS PURCHASE AGREEMENT
NUMBER 99-001
TABLE OF CONTENTS
PAGE
Article 1. PURPOSE 1
Article 2. DEFINITIONS 1
Article 3. PURCHASES AND PURCHASE ORDERS 3
Article 4. GENERAL OBLIGATIONS OF THE PURCHASER 3
Article 5. OBLIGATIONS AND REPRESENTATIONS OF MOTOROLA 4
LMDS PRODUCTS PURCHASE AGREEMENT NO.99-001
LMDS PRODUCTS PURCHASE AGREEMENT (THIS "Agreement") dated as of 09,April 1999,
between MOTOROLA, INC., a Delaware corporation, acting through the Ground
Systems Division of its Satellite Communications Group, with offices at 2501 S.
Price Road, Chandler Arizona, 85248, U.S.A. ("Motorola"), and American Wireless,
Inc.. a Utah corporation (the "Purchaser"). Motorola and the Purchaser are
hereinafter sometimes referred to collectively as the "Parties".
RECITALS
WHEREAS. Motorola has designed certain hardware and software for use in
connection with wireless broadband systems;
WHEREAS Motorola desires to sell to the Purchaser and the Purchaser
desires to purchase from Motorola from time to time certain Products (as
hereinafter defined) pursuant to the terms and conditions of this Agreement;
NOW' THEREFORE, in consideration of the foregoing recitals and the mutual
obligations herein contained, the Parties agree as follows:
ARTICLE: 1. PURPOSE
the purpose of this Agreement is to establish the terms and conditions
that will apply to the purchase from time to time by the Purchaser from Motorola
of Products. Purchases hereunder will be accomplished by means of Purchase
Orders (as hereinafter defined).
The Parties intend that each Purchase Order will be a part of 7 and be
governed by, the terms and conditions of this Agreement, except with respect to
those terms and conditions negotiated for a specific Purchase Order and
designated in such Purchase Order as taking precedence Ever this Agreement.
<PAGE>
ARTICLE 2. DEFINITIONS
Unless otherwise indicated in this Agreement, the following terms, when
written herein with capitalized initial letters, shall have the meanings set
forth below.
"AGREEMENT": This Products Purchase agreement, including all schedules
and exhibits hereto, as amended, supplemented or otherwise modified from time to
time.
"FEATURE": A functionality or performance characteristic of Software.
"FIRMWARE": Software in object code form that is imbedded in Hardware.
-1
LMDS PRODUCTS PURCHASE AGREEMENT NO.99-001
"GOVERMMENTAL AUTHORITY": Any nation or government any state or other
political subdivision therof and any enity exercising executive legislative,
judicial, regulatory or administrative functions of or pertaining to government
"Hardware": The tangible and physical goods portion of the Products
purchased hereunder, but not software or firmwar
"INTELLECTUAL PROPERTY" All trade secrets' know-how' discoveries,
improvements, inventions, technical data, writings' software in whatever form.
Proprietary Information', patents, invention certificates arid applications
therefore, copyright;, and maskworkss and applications therefor
"PERSON": An individual partnership, limited liability company,
corporation, business trust, joint stock company, trust, unincorporated
association, joint venture, Governmental Authority or other entity of whatever
nature.
"PRODUCTS": The Hardware, Software and Services purchased hereunder and
described in the Purhase Orders.
"PROPRIETARY INFORMATION": as defined in Article 12(A).
"PURCHASE ORDER". Each document executed by the Purchaser and Motorola,
substantially in the form of Exhibit A hereto, which sets forth the Product(s)
to be said by Motorola and purchased by Purchaser. All Purchase Orders shall be
listed on Schedule I hereto. Motorola shall update Schedule I from time to time
as necessary to accurately reflect the information therein. Any reference in
this Agreement to Schedule I shall be deemed to be a reference to Schedule I as
ascended and in effect from time to time
"SERVICES": The services to be performed by or on behalf of Motorola from
time to time as set forth in the Purchase Orders.
"SITE": Each of the geographic locations owned, operated or controlled by
the Purchaser at which any Hardware or 'Software purchased hereunder is or is
intended to be installed and/or any Services are or are intended to be
performed.
"SOFTWARE": The object-code computer programs, including Firmware object
code, licensed or sublicensed by Motorola for use solely in conjunction with the
operation of the Products. ANY REFERENCE TO SOFTWARE BEING SOLD"PROVIDED" OR
"PURCHASED ISI UNDERSTOOD TO BE REFERENCE TO THE SOFTWARE BEING LICENSED OR
SUBLICENSED SOLELY AS PROVIDED IN THE SOFTWARE LICENSE.
"SOFTWARE LICENSE": The software license set forth in Exhibit B hereto.
"TAXES": as defined in Article 7(B)(1).
<PAGE>
ARTICLE 3. PURCHASES AND PURCHASE ORDERS
A. Motorola agrees to sell to the Purchaser, and the Purchaser agrees to buy
from Motorola, such Products as are described in the Purchase Orders, which
Purchase Orders are made a part hereof if fully set forth herein
B. The terms and conditions of this Agreement unless expressly modified in a
Purchase Order, shall be a part of and shall govern each such Purchase
Order. Any Products purchased under a Purchase Order shall be deemed to be
purchased pursuant to this Agreement
C. The Purchaser and Motorola shall mutually agree upon the terms of any
Purchase Order and shall both sign the Purchase Order to memorialize such
agreement No Purchase: Order shall he binding on either party unless and
until such Purchase Order has been signed by both parties.
ARTICLE 4.~A~4 OBLIGATIONS OF THE PURCHASER
The Purchaser shall, as applicable and at its own cost and expense:
A. Except as otherwise provided in Article 21, acquire in a timely fashion from
the appropriate Governmental Authorities and others and maintain in effect, all
permits and licenses, including, without limitation, radio frequency licenses.
radio operation licenses and any other required governmental, regulatory and
type, approvals, and all other, authorizations and approvals from Governmental
authorities and others as may be required from time to time to (i) import, and
install the Products in accordance with the schedule set forth in each Purchase
Order and (ii) to test and operate such Products.
B. Assist Motorola ire procuring all necessary permits licenses. visas or other
approvals, as may be required or reasonably convenient to allow Motorola
personnel and the personnel of Motorola's suppliers and subcontractors to travel
to, stay in and work in all Sites outside of the United States where the work
hereunder is to be performed, and provide such assistance as necessary to permit
Motorola to perform its obligations under this Agreement in accordance with the
schedule set forth in each Purchase Order.
C. Make in a timely fashion all business and legal arrangements as reasonably
required with Site owners or operators and others to allow she completion of the
Services in accordance with the schedule set forth in each Purchase Order.
D. Acquire and provide in a timely fashion all of the Sites, buildings and other
physical infrastructure, interconnection facilities, telephone service, utility
service, Site security, facilities maintenance, janitorial service and other
services and items necessary or reasonably convenient to allow the completion of
the Services in accordance with the schedule set forth in each Purchase Order.
E. Adhere to the schedule for performance of the Purchaser's responsibilities
set forth in each Purchase Order
F. Make all payments in accordance with Article 7, Payment and Pricing
G. Notify Motorola in writing at least thirty (30) calendar days in advance of
any requirement for a pricing breakout with respect to such item which imposed
by law or by the Purchaser's insurer such notice shall state the level of
pricing detail which is required by such law or by the Purchaser's insurer, as
the case may be.
H. Timely perform all of its other obligations under this Agreement, any
Purchase Order and any other agreement delivered in connection herewith.
ARTICLE 5. OBLIGATIONS AND REPRESENTATIONS OF MOTOROLA
Motorola shall, as applicable:
A. Provide and install the Products in accordance with Motorola's
obligations expressly set forth in each Purchase Order.
<PAGE>
B. Adhere to the schedule set forth in each Purchase Order for performance
of its responsibilities set forth therein.
C. Obtain all export licenses or other approvals necessary to export the
Products from their country of origin or manufacture to the applicable
Site
D. Reasonably cooperate with the Purchaser in the Purchaser's performance of
its obligations under Articles 4(A) and (id) hereof
E. Reasonably support the Purchaser in the Purchaser's responses to requests
from
F. Governmental Authorities related to the Products to be installed and
operated within the lawful territory of such Governmental Authority.
F. Upon proper notice Tom the Purchaser pursuant to Article 4(G) hereof
prior to delivery of any item of Hardware, provide, to the extent
commercially reasonable, a pricing breadcout of such item to the
Purchaser to the extent required by law or by the Purchaser's insurer.
Such pricing breakout shall meet, to the extent commercially reasonable,
the level of pricing detail sp~,~:ed Id; the Purchaser in its notice
given to Motorola pursuant to Article 4(G) hereof.
G. Timely perform all of its other obligations under this Agreement, each
Purchase Order and any other agreement
A. At any time during its performance of this Agreement, Motorola may implement
changes in the Products, modify the drawings and specifications relating
thereto, substitute different prducts therefore of substitute different
components therefore; provided however, that any such changes, modifications or
substitutions, under normal and proper use.:
1. Shall not materially or adversely affect physical or functional
interchangeability or performance of the Product (except where
there is written agreement between-the-Parties that specific
characteristics will be so affected);
2. Shall not detract from the safety of the Product; and
3. Shall be type-accepted by the appropriate authority, if required.
B. If Motorola exercises its right under this Article to change specifications
or Products or to substitute Product then Motorola -will provide reasonable
amounts of free training to Purchaser regarding any differences in Product
installation, operation and maintenance.
C. Changes in specifications for components Motorola purchases from third
parties, changes in manufacturers from whom Motorola buys components; equipment,
and/or Software, and other reasons may make it necessary for Motorola to change
the Specifications for Products from time to time, provided Motorola complies
with the requirements of Article 6 A.
ALL OF WHICH OTHER WARRANTIES BEE SPECIALLY EXCLUDED, INCLUDING,
WITHOUT LIMITATION, THE IMPLIED WARRANTIES OF MERCHANTABILITY AND
FITNESS FOR A PARTICILAR PURPOSE. IN NO EVENT SHALL MOTOROLA OR
ITS SUPPLIERS OR SUBCONTRACTORS AT ANY LEVEL BE LIABLE
FOR-INDIRECT NCIDENTAIL SPECIAL, PUNITIVE-OR-CONSEQENTIAL
DAMAGES; PROVIDED, HOWEVER, THAT IF THE LAW OF ANY JURISITICITION
APPLICABLE TO THIS AGREEMENT DOES NOT PERMIT SUCH DAMAGES TO BE
COMPLETELY DISCLAIMED THIS CLAUSE SHALL BE INTERPRETED AS
NECESSARY TO GIVE MOTOROLA AND ITS SUPPLIERS AND SUBCONTRACTORS
THE FULL BENEFIT OF ANY
<PAGE>
DISCLAIMER OR LIMITATION OF SAID DAMAGES TO THE FULL EXTENT
PERMITTED UNITER SUCH LAW
D. Motorola's additional warranty obligations (if any) with respect
to any Products will be set forth in the applicable Purchase
Order, and for the term and at the additional price (if any) set
forh in the applicable Purchase Order.
1. Motorola shall send notices to the purchaser as follows
American Wireless, Inc.
P.O.Box 2500
845 East Skyline Driv
St. George UT 84771 USA
Attn: Mr. Mical Terry,
President
Telephone: (435) 674 0320
Fax: (435) 634 0349
2. The Purchaser shall send notices to Motorola as follows:
MOTOROLA, INC.
GROUND SYSTEMS DIVISION
2501 S. Price Road
Chandler, Arizona. 85248-2899
Attn: Michael S. Schumacher
Sr Contract Manager
Mail Drop: VLSI
Telephone: (480) 456-7333
Fax: (480) 456-7237
D. Either party may change the address, telefacsimile number, or person for
receiving notices from time to time by Written notice to the other party of
such change.
AGREED AND ACCEPTED BY
AMERICAN WIRELESS, INC. FIRST FLORIDA COMMUNICATIOINS
By By
Name Name
Title Title
Date Date
EXHBIT-5.1
EX-5.1
PAUL RICHARD BELL, CFTC, LITIGATION EXPLANATION
In March 7, 1989' the Commodity Future Trading Commission (CFTC) filed a
complaint and notice of hearing pursuant to sections 6 (b),6(c),8a(3), and 8a(4)
of the Commodity Exchange Act, as amended. CFTC docket No. 89-4. The respondents
were JCC, Incorporated, EDCO Management Ellis K. Kahn, Paul Richard Bell, and
Edward Lerner. The complaint had three counts. Two of the counts involved
allegations concerning Paul Richard Bell. Count 1 alleged there were violations
through fraud in connection with the solicitation of customers to trade
commodity futures contracts. Count 2 did not apply to Mr. Bell. Count 3 alleged
violations through a failure to supervise.
On December 13,1991,the Administrative Law Judge (ALJ) ruled against the
respondents and revoked the registrations of Kahn, Bell, and Lerner. Further
more the ALJ assessed a monetary fine against all respondents. Bell received a
civil monetary penalty of $100,000. The respondents, JCC,Inc., Ellis K.Kahn, and
Paul Richard Bell appealed the ALJ's decisions. The appeal was denied in 1994.
Paul Richard Bell has not paid the fine and is in the process of deciding how to
appeal the decision with new counsel to get his license reinstated and the fine
revoked. In the final footnote of the appeal, the court comments that Bell's
attorney had a conflict on interest in that on appeal, just as at the hearing,
counsel could potentially be placed in the unseemly position of arguing his on
credibility. (See Groper v. Taff, 717 F .2d 1415, 1417-18 (D.C. Cir. 1983).
Attorneys practicing before administrative agencies are bound by the Code of
Professional Responsibility, including DR5-102A, which sets forth the rule that
attorneys are precluded from serving as a fact witness and counsel in the same
proceeding. Rosen v. NLRB, 735 F.2d 564, 573-77 (D.C.Cir.1984). This was the
same situation in Bell's case. Bell did not know of the conflict with the
attorney representing him.
EXHIBIT 6.1
PARADISE CONNECTIONS, INC.
STATEMENT OF INCOME
FOR THE TWELVE MONTHS ENDED OCTOBER 15, 1998
YEAR TO DATE
ACTUAL PERCENT
--------------------------
INCOME
OPERATING REVENUES $ 145,473.74 85.3
BUSINESS OPPORTUNITY SALE 24,987.00 14.7
------------ -----
* TOTAL INCOME 170,460.74 100.0
COST OF SALES
COST OF GOODS SOLD 32,110.42 18.8
AIR-TIME 25,858.80 15.2
COMMISSIONS 4,753.27 2.8
PREPAID PHONE CARDS 3,452.92 2.0
COURIER 67.04 0.0
------------ -----
* TOTAL COST OF SALES 66,242.45 38.9
------------ -----
* GROSS MARGIN 104,218.29 61.1
EXPENSES
ACCOUNTING FEES 1,090.00 0.6
AUTO EXPENSE 10.60 0.0
ADVERTISING & PROMOTION 4,735.11 2.8
BANK CHARGES 109.50 0.1
CREDIT CARD SERVICES 374.80 0.2
PAYROLL TAX EXPENSE 1,377.00 0.8
EQUIPMENT RENTAL 5,255.28 3.1
INSURANCE 6,068.06 3.6
LICENSE & PERMITS 501.61 0.3
POWER & LIGHT 4,050.41 2.4
SECURITY & PROTECTION 141.66 0.1
OFFICE SUPPLIES & EXPENSES 4,159.46 2.4
SALARIES & WAGES 18,000.00 10.6
FEDERAL & STATE UNEMPLOY 254.40 0.1
STATE SALES TAXES 9,178.63 5.4
POSTAGE, FREIGHT, COURIER 7,491.62 4.4
RENT EXPENSE 14,093.28 8.3
REPAIRS & MAINTENANCE 3,007.18 1.8
SECURITY & PROTECTION 311.29 0.2
UTILITIES 427.29 0.3
TELEPHONE 7,989.23 4.7
WATER & SEWER 210.88 0.1
------------ -----
* TOTAL EXPENSES 88,837.29 52.1
------------ -----
* NET OPERATING PFT/(LOSS) $ 15,381.00 9.0
============ =====
<PAGE>
PARADISE CONNECTIONS, INC.
BALANCE SHEET
OCTOBER 15, 1998
ASSETS
CURRENT ASSETS
CASH IN CHECKING 1ST WEST $ 9,299.42
INVENTORY 7,852.25
-------------
TOTAL CURRENT ASSETS $ 17,151.67
FIXED ASSETS
WEBSITE 1,750.00
LEASEHOLD IMPROVEMENTS 2,850.00
OFFICE EQUIPMENT 2,269.85
EQUIPMENT SOFTWARE 9,443.61
OFFICE FURNITURE 4,757.56
WEB SITE DEVELOPEMENT 965.00
ACCUMULATED DEPRECIATION (3,476.00)
-------------
NET FIXED ASSETS 18,560.02
OTHER ASSETS
DEPOSITS RENT 1,712.00
-------------
TOTAL OTHER ASSETS 1,712.00
-------------
TOTAL ASSETS $ 37,423.69
=============
LIABILITIES & NET WORTH
CURRENT LIABILITIES
FICA TAXES PAYABLE $ (4.00)
PAYROLL TAX DEPOSITS (791.77)
-------------
TOTAL CURRENT LIABILITIES $ (795.77)
LONG-TERM LIABILITIES
SHAREHOLDERS LOANS 6,747.24
-------------
TOTAL LONG-TERM LIABILITIES 6,747.24
EQUITY
COMMON STOCK 20 SHARES 100.00
retained earnings 15,991.22
-------------
TOTAL EQUITY 16,091.22
-------------
TOTAL LIABILITIES & NET WORTH $ 22,042.69
=============
<PAGE>
PARADISE CONNECTIONS, INC.
STATEMENT OF INCOME
FOR THE TWELVE MONTHS ENDED OCTOBER 15, 1998
YEAR TO DATE
ACTUAL PERCENT
--------------------------
INCOME
OPERATING REVENUES $ 145,473.74 85.3
BUSINESS OPPORTUNITY SALE 24,987.00 14.7
------------ -----
170,460.74 100.0
* TOTAL INCOME
COST OF SALES
COST OF GOODS SOLD 32,110.42 18.8
AIR-TIME 25,858.80 15.2
COMMISSIONS 4,753.27 2.8
PREPAID PHONE CARDS 3,452.92 2.0
COURIER 67.04 0.0
------------ -----
* TOTAL COST OF SALES 66,242.45 38.9
------------ -----
* GROSS MARGIN 104,218.29 61.1
EXPENSES
ACCOUNTING FEES 1,090.00 0.6
AUTO EXPENSE 10.60 0.0
ADVERTISING & PROMOTION 4,735.11 2.8
BANK CHARGES 109.50 0.1
CREDIT CARD SERVICES 374.80 0.2
PAYROLL TAX EXPENSE 1,377.00 0.8
EQUIPMENT RENTAL 5,255.28 3.1
INSURANCE 6,068.06 3.6
LICENSE & PERMITS 501.61 0.3
POWER & LIGHT 4,050.41 2.4
SECURITY & PROTECTION 141.66 0.1
OFFICE SUPPLIES & EXPENSES 4,159.46 2.4
SALARIES & WAGES 18,000.00 10.6
FEDERAL & STATE UNEMPLOY 254.40 0.1
STATE SALES TAXES 9,178.63 5.4
POSTAGE, FREIGHT, COURIER 7,491.62 4.4
RENT EXPENSE 14,093.28 8.3
REPAIRS & MAINTENANCE 3,007.18 1.8
SECURITY & PROTECTION 311.29 0.2
UTILITIES 427.29 0.3
TELEPHONE 7,989.23 4.7
WATER & SEWER 210.88 0.1
------------ -----
* TOTAL EXPENSES 88,837.29 52.1
------------ -----
* NET OPERATING PFT/(LOSS) $ 15,381.00 9.0
============ =====
