U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-SB
GENERAL FORM FOR REGISTRATION OF SECURITIES OF
SMALL BUSINESS ISSUERS
UNDER SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934
RENAISSANCE INTERNATIONAL GROUP, LTD.
(Name of Small Business Issuer in its Charter)
Nevada E.I.N. 85 0206668
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
7501 North 16th Street, Suite 200
Phoenix, AZ 85020
(Address of principal executive offices) (Zip Code)
Issuer's telephone number: (602) 906-1924
SECURITIES TO BE REGISTERED UNDER SECTION 12(b) OF THE ACT:
None
SECURITIES TO BE REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:
Title of each class Name of each exchange on which
to be so registered each class to be registered
Common Stock OTC Electronic Bulletin Board
Total Number of Pages: 151
Index to Exhibits Appears on Page: 25 Page: 1
<PAGE>
Except for the historical information contained herein, the matters set
forth in this registration statement are forward looking statements within
the meaning of the "safe harbor" provisions of the Private Securities
Litigation Reform Act of 1995. These forward looking statements are
subject to risk and uncertainties that may cause actual results to differ
materially. These forward looking statements speak only as of the date
hereof and the Company disclaims any intent or obligation to update these
forward looking statements.
PART I
ITEM 1. DESCRIPTION OF BUSINESS
(a) BUSINESS DEVELOPMENT
Renaissance International Group, Ltd. ("the Company") is a Nevada
Corporation, originally organized in New Mexico in 1968. The Company moved
its domicile to Nevada in 1994. The Company's current corporate office is
located at 7501 N. 16th St., #200, Phoenix, AZ, 85020 and its telephone
number is (602) 906-1924.
The Company's predecessor, Renaissance Center, Inc., was incorporated in
September of 1996, and has had continuous operations since that date. On
July 2, 1997 Renaissance Center, Inc., a Nevada Corporation, merged with
Nuclear Corporation of New Mexico, a Nevada Corporation. The merged
company subsequently changed its name to Renaissance International Group,
Ltd. a Nevada Corporation. Nuclear Corporation of New Mexico, originally
incorporated in the state of New Mexico in December of 1968, has had
limited or no operations for at least the past 15 years. Nuclear
Corporation of New Mexico changed its domicile to Nevada in April of 1994.
The Company employs approximately 12 people. The Company's e-mail address
is [email protected]. The Company maintains a web site at www.rigl.com.
(b) BUSINESS OF ISSUER
The Company's diversified operations are conducted primarily through its
three subsidiaries, Renaissance Center, Ltd., Renaissance MedTech, Ltd. and
Renaissance ASD, Ltd. The Company's operations include: (i) design and
implementation of advanced high speed, high bandwidth computerized network
solutions; (ii) design, development and implementation of asset management
and information retrieval software for the multimedia and entertainment
industry; (iii) design, development and implementation of asset management
and information retrieval software for the medical industry; (iv) physician
practice management services; (v) consultation and development of end to
end solutions including high speed, high bandwidth, advanced, fully
automated, intelligent digital
- 2 -
<PAGE>
management systems.
The digital conversion segment of the Company's operations are conducted
through two of its wholly owned subsidiaries, Renaissance Center, Ltd.
(RenCen) and Renaissance ASD, Ltd. The Company specializes in offering
analog to digital conversion of numerous material and analog information
assets. This includes but is not limited to, paper, film, video, audio,
imaging, existing legacy data, and voice information. Through various
technologies the Company is capable of introducing endless possibilities of
methods of entering data.
RENAISSANCE CENTER, LTD.
________________________
The Company's operations related to the design and implementation of asset
management software for the multimedia and entertainment industry are
conducted through its wholly owned subsidiary Renaissance Center, Ltd.
(RenCen). The primary technology is the AMIRE system (Asset Management and
Information Retrieval Environment). RenCen customizes the core AMIRE
system for use in the entertainment and multimedia fields for management
and accounting of film assets, computer effects, special effects, musical
scores, sound tracks, dialog, sound effects, computer animation, animation,
stock footage, finished film, documentary film, television broadcasts,
merchandise, and other related assets produced in the industry.
RENAISSANCE ASD, LTD.
______________________________
The Company's operations related to the design and implementation of Asset
Management and Information Retrieval Environment are conducted directly
through its wholly owned subsidiary Renaissance ASD, Ltd. The Core
Development Division of this subsidiary is responsible for the development,
deployment, management and support of the Company's primary technology
known as AMIRE system (Asset Management and Information Retrieval
Environment). This system combines the Company's advanced network
solutions with a revolutionary three dimensional object-oriented database
and graphical user interface. The system is designed as a foundation or
core, to be customized and complimented into complete information
management systems dictated by industry specific requirements.
The Company's operations related to the design and implementation of Asset
Management Environment for the medical industry are conducted directly and
through its wholly owned subsidiary Renaissance ASD, Ltd. The Medical
AMIRE Division of this subsidiary specializes in building upon the core
AMIRE system to meet the requirements and offer advanced tools to the
medical industry. The Medical AMIRE system offers management and
- 3 -
<PAGE>
accounting of complete medical and inventory records, this includes detail
patient records, insurance documentation, billing information, accounting,
imaging, MRI, X-ray, C-T scan, ultra sound, diagnosis history, drug
interaction history, prescription record, surgical notes, surgical
recordings, vital sign records, and other medical related information that
is relevant to patients and operations of medical practices. Large
databases can be created for search and reference of similar medical
scenarios on a national and international basis.
RENAISSANCE MEDTECH, LTD.
________________________
Renaissance MedTech, Ltd., (MedTech) is a physician practice management
organization which is developing an integrated health care delivery network
in selected geographic areas through affiliation with physician practices
(the "Affiliated Practices").
MedTech's primary objective is to develop and manage an integrated health
care delivery network comprised of physician practices that provide high
quality, cost-effective care. In the short to mid-term, MedTech has
targeted its primary affiliation efforts on physician practices located in
Arizona. MedTech targets physicians who are:
1. Committed to the delivery of high quality, cost-effective care;
2. Have a reputation with their patients, peers, and payors for
providing quality medical services;
3. Have the capacity to increase profitability through improved
performance on existing patient bases.
When affiliating with a physician practice, MedTech will typically purchase
the practice's non-real estate operating assets and enter into a long-term
Management Services Agreement ("MSA") with the practice in exchange for a
combination of common stock, cash, notes, and/or the assumption of
liabilities. Pursuant to the MSA, MedTech will be responsible for
providing the Affiliated Practice with necessary office facilities, medical
equipment, supplies and non-medical staff, and will plan and manage the
activities of the Affiliated Practice in all respects other than the
provision of medical services. The Affiliated Practice will be solely
responsible for the rendering of medical services.
The Company's consultation services are conducted through the Company and
its two subsidiaries, RenCen and ASD depending upon the market segment
expertise required. Consultation services encompass the medical and
multimedia/entertainment fields as well as general electronic networking,
high band width, high storage solutions.
- 4 -
<PAGE>
(c) INDUSTRY OVERVIEW AND COMPETITION
In each business segment served by the Company, there is intense
competition from established competitors, some with substantially greater
financial, engineering, manufacturing and marketing resources and greater
name recognition than the Company as well as established customer
relationships. Additionally, new competitors may seek to enter some or all
of the business segments in which the Company operates.
(d) RESEARCH AND DEVELOPMENT
Technology developments occur rapidly in the computer software and hardware
industries. While the affects of such developments are uncertain, they may
have a material adverse effect on the demand for the Company's technology.
Additionally, the asset management system is still in final development
stages and has yet to be successfully marketed. The Company's management
believes that $2.5 million will be needed to complete these processes.
Accordingly the market acceptance of this technology is unknown. The
Company's success with this technology depends on its ability to
successfully produce a reliable system and to access the market for such
technology. There can be no assurance that the Company will be able to
remain competitive or that its technology, services or products will not
become subject to obsolescence.
(e) REGULATORY BACKGROUND
Federal and state laws extensively regulate the relationships among
providers of health care services, physicians and other clinicians. These
laws include federal fraud and abuse provisions that prohibit the
solicitation, receipt, payment or offering of any direct or indirect
remuneration for the referral of patients for which reimbursement is made
under any federal or state funded health care program, or for the
recommending, leasing, arranging, ordering or providing of services covered
by such programs. States have similar laws that apply to patients covered
by private and government programs.
Federal fraud abuse laws also impose restrictions on physicians' referrals
for designated health services covered under a federal or state funded
health care program to entities with which they have financial
relationships. Various states have adopted similar laws that cover
patients in private programs as well as government programs.
There can be no assurance that the federal and state governments will not
consider additional prohibitions on physician ownership, directly or
indirectly, of facilities to which they refer patients, which could
adversely affect the Company. Violations of these laws may result in
substantial civil or criminal penalties for individuals or entities,
including large civil money penalties and
- 5 -
<PAGE>
exclusion from participation in federal or state health care programs.
Moreover, the laws of many states prohibit physicians from sharing
professional fees, or "splitting fees" with anyone other than a member of
the same profession. These laws and their interpretations vary from state
to state and are enforced in courts by regulatory agencies with broad
discretion. Expansion of the operations of the Company to certain
jurisdictions may require structural and organizational modifications to
the relationship with medical affiliates. This could adversely effect the
Company.
Although management believes its operations as currently structured are in
material compliance with existing laws, there can be no assurance that
review of the Company's business by a regulatory agency or as presented to
a court will not result in an adverse determination, or that the health
care regulatory environment will not change so as to restrict the Company's
existing operations or its expansion. Either of these developments would
adversely affect the operations of the Company.
State Laws Regarding Prohibition of Corporate Practice of Medicine
The medical affiliates are expected to be formed as professional
corporations owned by one or more physicians licensed to practice medicine
under applicable laws in states that prohibit the corporate practice of
medicine. Corporations such as the Company are not permitted under such
laws to practice medicine or exercise control over the medical judgements
or decisions of practitioners. Corporate practice of medicine laws and
their interpretations vary from state to state and are enforced in courts
by regulatory agencies with broad discretion. The Company anticipates that
it will perform only non-medical administrative services, will not
represent to the public that it offers medical services and will not
exercise influence or control over the practice of medicine by the
practitioners with whom it contracts. Changes to the operations of the
Company's form of relationship with medical affiliates in order to comply
with the medical practice laws could have an adverse effect on the Company.
Although management believes that its operations as currently structured
will be in material compliance with existing applicable laws, there can be
no assurance that the Company's structure will not be challenged as
constituting the unlicensed practice of medicine or that the enforceability
of the agreements underlying this structure will not be limited. If such
a challenge were successfully made in any state, the Company would be
subject to civil and criminal penalties and could be required to
restructure its contractual arrangements in that state. Such results, or
the inability to restructure its contractual arrangements, could have a
material adverse effect upon the Company.
- 6 -
<PAGE>
Changes in Regulation of the Delivery of and Payment for Health Care
Services.
Although Congress failed to pass comprehensive health care reform
legislation in 1996, the Company anticipates that Congress and state
legislatures will continue to review and assess alternative health care
delivery and payment systems, and may in the future propose and adopt
legislation effecting fundamental changes in the health care delivery
system. The Company cannot predict the ultimate timing, scope or effect of
any legislation concerning health care reform. Any proposed federal
legislation, if adopted, could result in significant changes in the
availability, delivery, pricing and payment for health care services and
products.
Various state agencies also have undertaken or are considering significant
health care reform initiatives. Although it is not possible to predict
whether any health care reform legislation will be adopted or, if adopted,
the exact manner and the extent to which the Company will be affected, it
is likely that the Company will be affected in some fashion, and there can
be no assurance that any health care reform legislation, if and when
adopted, would not have a material adverse affect upon the Company.
ITEM 2. MANAGEMENT DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
(a) RESULTS OF OPERATIONS
The Company currently derives its revenue from consulting services provided
by Renaissance Center, Ltd. (RenCen), a wholly owned subsidiary of the
Company. RenCen owns a proprietary technology developed by a Company
officer for the integration of equipment and components in high-tech
digital multimedia studios.
Management has recognized that recent developments in data storage and
optical transmission capabilities have greatly increased the capability to
transfer, store and retrieve data. Hierarchical communication languages
can be used to develop software applications which will make real-time
access of this information a reality as well as adding artificial
intelligence to core operating systems.
These recent developments, combined with the Company's own state of the art
proprietary technology have enabled it to look at alternative applications.
Management believes that the health services industry may provide this
alternative. This industry, though technically advanced in equipment,
relies upon out-dated record keeping and retrieval methods. The Company is
actively pursuing acquisitions and affiliations in the medical industry.
Initially it has targeted physician groups, outpatient surgical centers,
skilled nursing facilities and medical specialty organizations. It is
management's intention to continue to examine all industries for possible
applications of its proprietary
- 7 -
<PAGE>
technology as well as looking for opportunities to acquire other
synergistic technologies.
(b) STATEMENT OF EARNINGS DATA
For year ended For 3 months ended
-------------- ------------------
09/30/97 09/30/96 12/31/97 12/31/96
-------- -------- -------- --------
Revenues $36,542 $1,341 $1,582 $12,702
Gross Profit 26,000 661 1,582 12,702
Net Profit(Loss) $(1,222,646) $(27,877) $(388,436) $(262,437)
The increase in the net loss for the year ended September 30, 1997,
compared to the year ended September 30, 1996 relates to several key
components to the future success of the Company. First are the expenses
incurred associated with research and development costs related to the
Company's proprietary technology. Additional costs are due to increased
sales and marketing efforts related to the Company's proprietary
technology. Finally, the net loss increased due to the costs incurred in
securing key management personnel for both the corporate management and
development programs.
The increase in the net loss for the quarter ended December 31, 1997,
compared to the quarter ended December 31, 1996, mainly relates to the
increased costs incurred in securing key management personnel for both the
corporate management and development programs.
While research and development costs will continue, management believes
that initial contracts in the near future will begin to generate revenues
from the hardware integration and data management consulting segments of
the business. As a result, the Company does not foresee profitable
operations in the short term, but does expect revenue growth leading to
profitability on a longer-term basis. However, there can be no assurances
as to whether the Company will ever achieve profitability.
(c) BALANCE SHEET DATA
12/31/97 09/30/97 09/30/96
-------- ---------------------
Current Assets $ 2,069,828 $ 847,044 $ 9,345
Long-term Assets 288,129 272,075 13,000
---------- ---------- ---------
Total Assets 2,357,957 1,119,119 22,345
Current Liabilities 253,700 32,526 100
Stockholder's
Equity $ 2,104,257 $ 1,086,593 $ 22,245
---------- ---------- ---------
Total Liabilities
and Stockholder's
- 8 -
<PAGE>
Equity $ 2,357,957 $ 1,119,119 $ 22,345
(d) LIQUIDITY AND CAPITAL RESOURCES
The Company's current ratio was 8.2 to 1 at December 31, 1997. The
Company's current ratio was 26.0 to 1 at September 30, 1997. Cash and cash
equivalents increased $1,222,587 to $2,064,289 at December 31, 1997. Cash
and cash equivalents increased $832,358 to $841,702 at September 30, 1997.
The increase in cash and cash equivalents was primarily due to payments
received on preferred stock subscriptions offset by cash used in
operations.
The Company has successfully raised capital financing during the quarter
ended December 31, 1997, and the year ended September 30, 1997. Additional
capital will be required for the Company to fully expand its operations
into all of the markets. The amount of additional capital that may be
required is dependent upon, among other things, the expansion of existing
financial resources, and the availability of other financing on favorable
terms and future operating results. Therefore, the Company's ultimate
success may depend upon its ability to raise additional capital or debt
financing. There can be no assurance that additional capital can be raised
or obtained as needed or that the Company can ultimately fulfill its
business objectives.
The Company believes that it has adequate cash on hand to satisfy its
working capital requirements in fiscal 1998. The Company does not
anticipate paying dividends on its Common Stock in the foreseeable future.
Certain matters contained herein are forward looking statements that
involve risks and uncertainties that could cause actual results to differ
materially from those in the forward-looking statements. Assumptions
relating to these forward looking statements involve judgments with respect
to, among other things, future economic, competitive and market conditions
and future business decisions, all of which are difficult or impossible to
predict accurately and many of which are beyond control of the Company.
(e) IMPACT OF INFLATION
The Company believes that inflation has not had a material affect on its
past business.
(f) YEAR 2000 ISSUE
Virtually all companies and organizations are devoting resources to
evaluating the "Year 2000 Issue." This critical data management problem
may have substantial financial consequences for companies throughout the
world. Most computer systems in use today were
- 9 -
<PAGE>
designed and developed over many years without regard to the impact of the
upcoming century change. Because memory was so expensive on early
mainframe computers, many programs used only two digits for the year in the
date fields. As a result many computer applications could fail completely
or create erroneous results by the year 2000, unless corrective measures
are taken.
The Company's management has addressed the extent of the problem as it
pertains to (i) the Company's data systems and (ii) the Company's
proprietary software for use by its customers.
With regard to the Company's data systems, management has determined that
the Company's data systems are functionally operable to handle four digit
date fields and that the Year 2000 Issue will not materially affect future
financial results, or cause reported financial information to necessarily
be inherently unreliable as a result of the Year 2000 Issue.
With regard to the Company's proprietary software, specifically the AMIRE
software, the Company undertook to test its application which revealed that
no modifications or replacements to significant portions of its software
will be required in order for the software to run properly after December
31, 1999. The Company has determined that it has no material exposure to
contingencies related to the Year 2000 Issue for its AMIRE product.
Management has allocated no resources specifically to the Year 2000 Issue.
Management intends to continue to review on an ongoing basis the need for
projected expenditures and uncertainties arising from this issue. This
ongoing review will consider the consequences to the Company in the event
of the need for additional expenditures or the impact on the functional
performance and the marketability of the Company's proprietary products,
such as AMIRE. However there can be no guarantee that the systems of other
companies on which the Company's systems rely will be timely identified or
converted, or that a failure to convert by another company, or a conversion
that is incompatible with the Company's systems, would not have material
adverse effect on the Company.
ITEM 3. DESCRIPTION OF PROPERTY
The Company rents 1,700 square feet of administrative offices at 7501 North
16th Street, Suite 200, Phoenix, Arizona 85020 and intends to expand into
a second facility in Phoenix to increase its square footage available for
inventory and product development. The Company also rents approximately
600 square feet of technical laboratory space at 100 Bluebell Place,
Vallejo, California 94591.
The Company has signed a lease to occupy 9,460 square feet of space located
at 2398 E. Camelback Rd., Suite 900, Phoenix, Arizona. The lease term
commences on July 1, 1998, and extends for 40 months. The initial rent due
is $23.00 per square foot. The lease renews
- 10 -
<PAGE>
on September 1, 1998, at which time the price per square foot increases
from $23.00 to $24.00. The lease term expires in September 2001, at which
time the Company will be paying $26.00 per square foot.
The Company rents a furnished apartment in the Phoenix metropolitan area
primarily for use as lodging on visits by certain of the Company's officers
and directors who do not reside in Phoenix. The Company has signed a six
month lease on the apartment. It expires in October 1998. The monthly
rent on the apartment is $912.00. Management believes that the lease of
the apartment is more economical than reimbursing the visiting officers and
directors for hotel lodging.
ITEM 4. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
(a) SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
Title of Class Name and Address Amount and Nature % of
- -------------- of Beneficial Owner of Beneficial Owner Class
------------------- ------------------- -----
Common Stock Tennessee Webb 1,066,958 8.795%
Common Stock Michael MacKay 1,415,000 11.664%
Total of All Beneficial Owners: 2,471,958 20.459%
(b) SECURITY OWNERSHIP OF MANAGEMENT
Title of Class Name and Address Amount and Nature % of
- -------------- of Beneficial Owner of Beneficial Owner Class
------------------- ------------------- -----
Common Stock James Jones 252,500 2.081%
Common Stock William O'Neal 243,083 2.004%
Common Stock Kevin Jones 252,500 2.081%
Common Stock Richard Rice 91,000 0.750%
Common Stock Michael MacKay 1,415,000 11.664%
Common Stock John Williams 50,000 0.412%
Common Stock Walter Vogel 100,000 0.824%
Common Stock Harold Roberts 233,000 1.921%
Common Stock Tennessee Webb 1,066,958 8.795%
Common Stock Peter de Krey (1) 258,688 2.132%
Total of all Management 3,962,729 32.67%
(1) Mr. de Krey's Common Stock ownership quantity and percentage figures
include 25,000 shares of Common Stock owned by his spouse, Karen Sotomayor,
of whose shares he disclaims actual ownership or the right to assert
control.
(c) CHANGES IN CONTROL
- 11 -
<PAGE>
There are no arrangements which may result in a change in control in the
Company.
ITEM 5. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS
The following are the names, positions, municipalities of residence and
relevant backgrounds of key personnel of the Company.
(a) DIRECTORS AND EXECUTIVE OFFICERS
KEVIN L. JONES (Age 42), President and Director,
Phoenix, Arizona.
1997 to Present: Renaissance International Group, Ltd.
Treasurer, Chief Financial Officer, and President.
1995 to Present: Director of Berry-Shino Securities, Inc.
1988 to 1996: Chief Financial Officer of Alanco Environmental Resources
Corporation, a Nasdaq listed public company. Mr. Jones served as
President of Alanco in 1995.
TENNESSEE WEBB (Age 54), Chairman of the Board of Directors,
Phoenix, Arizona.
1996 to Present: Renaissance International Group, Ltd., Chairman of the
Board of Directors.
1996: Digital Masters Library Corp., Phoenix, AZ. Business advisor.
1995: UMS Corp., Phoenix, AZ., Business advisor.
1994: Don Crampton & Associates, Phoenix, AZ. Business advisor.
1993: Alpha Pacific Corp., Memphis, TN. Business advisor.
Mr. Webb holds a B.Sc. from Milligan College, in Tennessee and an LLB.
from the University of Ottawa, Ottawa, Canada. He completed his
articles at the International law firm of Olsler Hoskin & Harcourt,
and was admitted to the Bar as Barrister-at-Law at Osgoode Hall,
Toronto, Canada.
MICHAEL MACKAY (Age 40), Chief Technology Officer. Santa Clara, CA.
1996 to Present: Renaissance International Group, Ltd., Chief Technology
Officer.
1992 to Present: Renaissance Center, President and Chief Technology
Officer. Founder of consulting firm operating as a virtual
corporation by incorporating a network of teams' structure. This
organization has contributed significantly to the development of high
end media projects. Associated projects include, among others: (i) GM
Hughes Electronics' Hughes Satellite Communications, Analyst under
contract to lead the team to generate the test procedures for bringing
system on line; (ii) SunUP Design Systems, design engineering
- 12 -
<PAGE>
for next generation broadcast automation system for large multichannel
installations; (iii) DiviCom, provided comparative market product
research, needs assessment and technical documentation; and (iv)
MEASAT Malaysian DBS, designed and generated request for proposal
documents for the Malaysian DBS system ASTRO MEASAT and participated
in award of contract proposal.
1989 to 1992: Sony Corp., Director of New Products and Technology at
Sony's Advanced Video Technology Center.
PETER de KREY (Age 44), Vice President of International Business
Development and Secretary.
1991 to Present: Renaissance International Group, Ltd. Vice President of
International Business Development and Secretary.
1981 to 1992: Schlumberger GmbH. Manager and Field Engineer in the United
Kingdom. Schlumberger is a high-tech service company to the oil
industry. Mr. de Krey held technical, marketing, sales and operations
management positions in six different countries.
Mr. de Krey received a Bachelors of Science in Marine Engineering from
Amsterdam Marine Engineering College in 1976. Through Schlumberger
Mr. de Krey obtained the equivalent of a Bachelor of Science in
Electrical Engineering in the United Kingdom. Mr. de Krey speaks four
languages fluently (English, Dutch, German and French).
WALTER VOGEL (Age 58), Director.
March 1998 to Present: Renaissance International Group, Ltd., Director.
1990 to Present: MC Management GmbH, Owner and President of German
management consulting firm.
HAROLD ROBERTS (Age 70), Director. Santa Fe, New Mexico.
1996 to Present: Renaissance International Group, Ltd., Director.
1996 to Present: SunRay Oil Company, a Nevada corporation, President and
Director.
1996 to Present: Candu, Inc. a Nevada corporation, Secretary, Treasurer
and Director.
1994 to Present: Verilite Aircraft Corporation, a New Mexico corporation,
President and a Director.
1955 to Present: Mr. Roberts maintains a private law practice in Santa Fe,
NM.
Mr. Roberts is a graduate of the University of Colorado Law School
where he was an editor of the Rocky Mountain Law Review. Mr. Roberts
was admitted to the Bar in New Mexico in 1955.
- 13 -
<PAGE>
JOHN WILLIAMS (Age 38), Chief Financial Officer. Phoenix, Arizona.
March 1998 to Present: Renaissance International Group, Ltd. Chief
Financial Officer.
1996 to March 1998: Bell Sports Corp., Vice President of Finance and
Controller.
1994 to 1995: MicroAge Computer Corporation, Assistant Controller.
1989 to 1994: Price Waterhouse LLP, Senior Audit Manager.
Mr. Williams is a graduate of the University of Rhode Island (B.S. in
Accounting). He became a Certified Public Accountant in 1984, and is
a Member of the Connecticut Society of Certified Public Accountants
and of the American Institute of Certified Public Accountants.
WILLIAM D. O'NEAL (Age 38), Senior Vice President, General Counsel and
Director. Phoenix, Arizona.
October 1997 to Present: Renaissance International Group, Ltd., Senior
Vice President, General Counsel and Director.
1995 to 1997: Quarles and Brady, Phoenix, AZ, Attorney at Law.
1994 to 1995: Beus, Gilbert & Morrill, Phoenix, AZ, Attorney at Law.
1993 to 1994: O'Connor Cavanaugh, Phoenix, AZ, Attorney at Law.
In 1984, Mr. O'Neal received his undergraduate degree in Professional
Music from Berklee College of Music, Boston, MA. Mr. O'Neal is a
graduate of University of Oregon School of Law, Eugene, OR. (1991).
Mr. O'Neal was admitted to the Alaska Bar in 1991 and the Arizona Bar
in 1993.
JAMES JONES (Age 26), Vice President of Finance and Investor Relations.
Phoenix, Arizona.
1996 to Present: Renaissance International Group, Ltd., Vice President of
Finance and Investor Relations.
1994 to 1996: Alanco (Beijing) Environmental Resources Technology, a
division of Alanco Environmental Resources Corporation, a Nasdaq
listed company. President. This division employed eight employees at
the time.
1991 to 1994: Alanco Environmental Resources Corporation, Director of
Investor Relations.
(b) SIGNIFICANT EMPLOYEES
RICHARD RICE, (Age 42), Director of Engineering. Mr. Rice oversees and
manages various engineering projects. Mr. Rice holds a B.S. in Electrical
Engineering from Arizona State University (1979).
(c) FAMILY RELATIONSHIPS
- 14 -
<PAGE>
James Jones is the nephew of Kevin L. Jones and he is the step-son of
Richard Rice.
(d) INVOLVEMENT IN CERTAIN LEGAL PROCEEDINGS
There are no legal proceedings to report.
ITEM 6. EXECUTIVE COMPENSATION
(a) SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
====================================================================================================
Securities
Other Restric- Underly-
Annual ted ing All
Name and Compen- Stock Options/ LTIP Other
Position Year Salary Bonus sation Award(s) SARs Payouts Compensation
(US$) ($) ($) ($) (#) ($) ($)
- ----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Tennessee Webb 1997 82,344 0 18,000 3,300 0 0 0
Michael MacKay 1997 64,329 0 46,600 1,655 0 0 0
Peter de Krey 1997 61,224 0 0 1,655 0 0 0
James Jones 1997 20,000 0 46,600 1,655 0 0 0
Kevin Jones 1997 20,000 0 40,000 1,655 0 0 0
</TABLE>
(b) OPTION/SAR GRANTS IN LAST FISCAL YEAR (INDIVIDUAL GRANTS)
None
(c) AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR AND
FY-END OPTION/SAR VALUES
None
(d) LONG-TERM INCENTIVE PLANS -- AWARDS IN LAST FISCAL YEAR
None
(e) COMPENSATION OF DIRECTORS
1. Standard Arrangements.
The members of the Company's Board of Directors are reimbursed for
- 15 -
<PAGE>
actual expenses incurred in attending Board meetings.
2. Other Arrangements.
There are no other arrangements.
(f) EMPLOYMENT CONTRACTS AND TERMINATION OF EMPLOYMENT, AND
CHANGE-IN-CONTROL ARRANGEMENTS
There were no employment contracts among the Company and any of its
management at the end of the 1997 fiscal year. Subsequently, each member of
management has entered into an employment contract with the Company. These
contracts are attached as Exhibit 4 (i).
(g) REPORT ON REPRICING OF OPTIONS/SARS.
None.
ITEM 7. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Company acquired 300,000 shares of Nuclear Corporation of New Mexico
(NCNM) for $20,000. These shares became assets of Renaissance Center, Inc.
and the proceeds of the sale were used by the management of NCNM to
complete the due diligence resulting in the Agreement and Plan of Merger
between the two companies. On July 2, 1997, Renaissance Center, Inc.
ceased to exist as a separate entity and NCNM changed its name to
Renaissance International Group, Ltd. The 300,000 shares acquired in this
transaction were distributed to various officers of RIGL as bonuses for
completing the merger.
The Company issued 3,632,916 shares to Company officers in exchange for the
right, title and interest to proprietary technology.
The Company issued 382,250 common shares in exchange for services rendered
of which 339,500 were issued to Company officers for services rendered in
acquiring contract for a high-technology center at Bablesberg, Germany.
ITEM 8. LEGAL PROCEEDINGS
There are no legal proceedings to report involving the Company or its
management.
ITEM 9. MARKET PRICE FOR REGISTRANT'S COMMON EQUITY AND OTHER SHAREHOLDER
MATTERS
(a) MARKET INFORMATION
------------------
The Company's Common Stock is valued at $1.875 per share based upon the
last transaction occurring before the market close on April 1, 1998. The
Company's stock is listed for sale on the OTC Electronic Bulletin Board.
However, certain of the Company's shareholders
- 16 -
<PAGE>
have made private sale transactions through the Company. Currently, the
Company does not have a stock option plan.
On October 20, 1997, Berry-Shino securities of Phoenix, Arizona received
clearance from the NASD to trade the Company's common stock on the
Electronic Bulletin Board Quotation System under the symbol "RNIG." The
Company received a new CUSIP number on October 21, 1997 and the first trade
was executed on October 22, 1997. During calendar year 1997, 3,204,800
shares were sold to 120 individuals pursuant to Regulation D. Certificates
for these securities were issued with restrictive legends. Of these shares,
100,000 were purchased by Walter Vogel, a director of the Registrant, and
may only be publicly sold pursuant to Rule 144.
(b) HOLDERS
-------
There are 584 holders of the Company's Common Stock.
(c) DIVIDENDS
---------
The Company has paid no dividends to date on its Common Stock. The Company
reserves the right to declare a dividend when operations merit.
ITEM 10. RECENT SALES OF UNREGISTERED SECURITIES
Effective October 22, 1997 warrants were issued to existing stockholders to
acquire 1,180,800 preferred shares at a price of $2.00 per share and
750,000 common shares at a price $2.30 per share. The warrants expire on
October 22, 1999.
Management had previously approved 2,000,000 shares of Series A.1 Preferred
Stock under similar terms to that of the Series A Preferred Stock. As of
December 31, 1997, the Company had received subscriptions totalling
$961,250.
During the year ended September 30, 1997, the Company completed the
following stock transactions from its authorized but unissued capital
shares:
Payments in the amount of $2,266,600 were received on Series A Preferred
Stock subscriptions and $2,670 received on common stock subscriptions.
Costs and expenses relating to these sales totalled $62,500 of which
$60,000 was converted into preferred shares at the request of the selling
agents.
The Company issued 217,250 common shares in exchange for services rendered.
During the year ended September 30, 1996, the Company completed the
following stock transactions from its authorized but unissued
- 17 -
<PAGE>
capital shares.
The Company began a private placement of its Series A Preferred Stock and
Series A.1 Preferred Stock in September 1996. The private placement was
for 3,000,000 shares at a price of $1.00 per share. These shares carried
a conversion to common on a 1 for 1 basis when the Company became publicly
traded and listed on an exchange. This occurred in the fall 1997, and all
Series A Preferred and Series A.1 Preferred have now been converted to
common. Payments in the amount of $35,000 were received in the Preferred
Stock subscriptions.
The Company issued 1,010,814 shares for cash. Cash in the amount of $250
was received in exchange for these shares and subscriptions receivable in
the amount of $3,470 was recorded.
The following table sets forth the sale of unregistered securities by the
Company during the three years ended March 31, 1998. Of the holders
depicted, all except for 92 of the holders, acquired their shares from
Josepthal, Lyon & Ross GmbH in Germany. Each of these holders is a
European resident. The Company sold the shares to Josepthal Lyon & Ross in
a transaction exempted from Section 5 of the Securities Act of 1933 in
reliance upon Regulation S (Rules 901 through 905).
Purchaser Name Date Security(1) Total
Consideration
(2)(3)
- ------------------ ---- ----------- --------------
491517 Ontario, Inc. 10/02/96 25,000 25,000
Abdin, Oussama 02/24/97 110,000 110,000
Agar, Ronald 10/02/96 25,000 25,000
Alraqbani, S. Mohammed 02/24/97 100,000 100,000
Apel, Manfred 09/29/97 10,000 10,000
Apel, Manfred 11/18/97 5,000 5,000
Apitzsch, Wolfgang Dr. 10/11/97 3,000 3,000
Apitzsch, Wolfgang Dr. 11/18/97 1,500 1,500
Baker Bros. Title Co. 03/15/97 10,000 10,000
Bartel, Joern 10/17/97 3,000 3,000
Bartel, Joern 11/18/97 10,000 10,000
Bartonek, Roger 09/29/97 5,000 5,000
Bartonek, Alexander 11/18/97 3,000 3,000
Bauer, Heidemarie 09/29/97 10,000 10,000
Baeder, Udo 12/10/97 80,000 80,000
Baumeister, Wolfgang 11/18/97 5,400 5,400
Banghard, Egon 11/18/97 100,000 100,000
Bechmann, Dr. Horst 11/18/97 2,400 2,400
Bentlage, Dirk 09/29/97 4,000 4,000
Bergmann, Udo 09/29/97 3,415 3,415
Bergmann, Udo 11/18/97 2,500 2,500
Bernd, Andreas 09/29/97 5,000 5,000
Bidlingmaier, Dieter 11/18/97 5,000 5,000
- 18 -
<PAGE>
Bilinski, Horst 11/18/97 2,000 2,000
Blanke, Juergen 09/29/97 51,500 51,500
Blanke, Juergen 11/18/97 20,000 20,000
Brauemer, Reinhold 11/18/97 225,000 225,000
Braun, D. Karl 11/18/97 1,500 1,500
Breu, Manfred 09/29/97 7,500 7,500
Brinkmann, Willi 10/17/97 18,000 18,000
Brunner, Adolf 09/29/97 5,000 5,000
Bryner, Joseph B. 12/04/96 10,000 10,000
Bryner, Joseph B. 06/28/97 10,000 10,000
Bubeck, Wolfgang 10/17/97 4,000 4,000
Budny, Silvia 09/29/97 3,000 3,000
Buesching, Gerhard 11/18/97 2,000 2,000
Christ, Lothar 11/18/97 40,500 40,500
Cicinelli, David A. 08/22/97 10,000 10,000
Courtin, Michael 11/18/97 8,500 8,500
Cronberger, Hans-Joachim 11/18/97 5,500 5,500
Daniels Family Trust,
Gene F. & Maria Rose 03/15/97 10,000 10,000
DeHesse, Valdemar
& Ellen 12/10/97 10,000 10,000
Dekker, Marcel 02/22/97 50,000 50,000
Delmastro, Thomas J. 02/05/97 50,000 50,000
Deylitz, Heinz 11/18/97 5,000 5,000
Diener, Thomas 09/29/97 5,000 5,000
Dietrich, Karl 09/29/97 5,000 5,000
Dittmann, Lothar 09/29/97 3,000 3,000
Doering, Clemens 09/29/97 15,000 15,000
Doering, Clemens 11/18/97 5,000 5,000
Donnerstag, Dr. Hans
Christian 03/26/97 20,000 20,000
Drautz, Siegfried 12/10/97 10,000 10,000
Droose, Marion 01/07/98 2,500 2,500
Duffy, Gary Patrick 07/01/97 15,000 15,000
Duzniak, Pawel 09/29/97 7,000 7,000
Duzniak, Pawel 11/18/97 3,000 3,000
Marketing Def. Ben.
Pension Plan - Marston,
Eric 09/12/96 10,000 10,000
Eckert, Matthias 09/29/97 5,000 5,000
Eckert, Matthias 11/18/97 5,000 5,000
Edinger, Christian 11/06/97 20,000 20,000
Eggink, Evert 05/30/97 100,000 100,000
Emblin trust 8/7/91,
Robert T. & Janet L. 12/12/96 5,000 5,000
Embs, Klaus J. 03/26/97 10,000 10,000
Eschmann, Hans-Juergen 09/11/97 10,000 10,000
Fabian, Dieter 09/29/97 2,000 2,000
Fabriz, Siegfried 09/29/97 6,000 6,000
Fabriz, Siegfried 11/18/97 6,000 6,000
Fahl, Albert 09/29/97 3,000 3,000
Falke, Eckhard 01/07/98 5,000 5,000
- 19 -
<PAGE>
Faller, Peter 09/29/97 3,000 3,000
Feit, Gernot 02/20/98 28,000 28,000
Fichtner, Gerald 10/02/97 3,000 3,000
Fichtner, Gerald 01/07/98 1,000 1,000
Fischer, Ralf 09/29/97 3,000 3,000
Flynn, Philip G. 02/25/97 25,000 25,000
Fossey, Heidi J.E. 12/12/96 5,000 5,000
Fredrich, Horst 09/29/97 20,000 20,000
Fredrich-Christ,
Kirstin 09/29/97 20,000 20,000
Friedhofen, Rolf 03/25/97 10,000 10,000
Fuchs, Erwin 09/29/97 8,000 8,000
Gebel, Dr. Joachim 09/29/97 10,600 10,600
Gebel, Dr. Joachim 11/18/97 7,200 7,200
George, Joerg 09/29/97 3,000 3,000
Gildhuis, Rainer 03/28/97 20,000 20,000
Glass, John Ryan 01/06/97 3,000 3,000
Glass, Jeffrey M. 01/06/97 1,500 1,500
Glass, John F. & Sally 01/06/97 10,000 10,000
Glass, John in trust
for Chelsea 01/06/97 1,500 1,500
Goetz, Gert 09/29/97 1,500 1,500
Goetz, Gert 01/07/98 1,500 1,500
Goethe, Thomas 01/07/98 2,500 2,500
Goldberg, Rhonda 10/02/96 10,000 10,000
Goldhar, Meyer 10/28/96 10,000 10,000
Goltz, Andreas 09/29/97 4,500 4,500
Goltz, Andreas 07/01/96 1,000 1,000
Gottlieb, Brian J. 11/28/96 5,000 5,000
Gottlieb, Carly 10/28/96 10,000 10,000
Gottlieb, Shaila 10/28/96 10,000 10,000
Gottlieb, Elyse 10/28/96 10,000 10,000
Grabmeier, Josef 09/29/97 6,000 6,000
Graham, Cathy 10/03/96 10,000 10,000
Graham, Bruce A. 11/29/96 15,000 15,000
Graham Family Trust 01/06/97 10,000 10,000
Grant, Karen L. 07/01/97 10,000 10,000
Great SW Mortg. Corp. 11/29/96 10,000 10,000
Great SW Mortg. Corp. 03/17/97 20,000 20,000
Grobe, Patrik 09/29/97 15,000 15,000
Grobe, Patrik 01/07/98 5,000 5,000
Gross, Gerd 09/29/97 3,000 3,000
Haberecht, Ralph 09/29/97 2,000 2,000
Haegele, Wolfgang 09/29/97 6,000 6,000
Harries, Guenther 01/07/98 3,500 3,500
Heichel, Wolfgang 10/17/97 5,500 5,500
Hein, Harley & Janet 10/22/96 10,000 10,000
Hein, Herbert 09/29/97 3,500 3,500
Hellwage, Albert 01/07/98 5,000 5,000
Henschel, Edward C. 06/16/97 65,000 65,000
Henschel, Edith G. 11/25/97 22,000 22,000
Hermann, Rolf 09/29/97 80,000 80,000
- 20 -
<PAGE>
Hermann, Rolf 12/10/97 60,000 60,000
Herold, Armin 09/29/97 6,900 6,900
Highsmith, Robert 11/12/96 5,000 5,000
Hill, Eric 12/13/96 100,000 100,000
Hines, Scott 08/27/97 20,000 20,000
Hirschfelder, Hans 09/29/97 32,000 32,000
Hoffman, Helga 01/07/98 5,000 5,000
Hofmann, Richard 09/29/97 7,000 7,000
Hood, Patricia 10/28/96 20,000 20,000
Hood Patricia 07/01/97 5,000 5,000
Hubbard Ford, Karen 12/23/97 46,000 46,000
Huettinger, Konrad 09/29/97 8,000 8,000
Huettinger, Konrad 01/07/98 3,000 3,000
ISG Capital Markets GmbH 01/07/98 2,100 2,100
ISC Capital Markets GmbH 12/10/97 12,000 12,000
ISC Capital Markets GmbH 02/19/98 1,000 1,000
Ivie, Sherry 10/28/96 5,000 5,000
Jaenicke, Juergen 09/29/97 30,000 30,000
Jaenicke, Juergen 02/20/98 10,000 10,000
Jaramillo, Susan 10/28/96 5,000 5,000
Jell, Anton 09/29/97 4,000 4,000
Jesemann, Guido 09/29/97 3,000 3,000
Jones, Richard H. 03/15/97 5,000 5,000
Juenger, Britta 11/25/97 1,000 1,000
Kallabis, Stefan 02/20/98 50,000 50,000
Karl, Stefan 09/29/97 25,000 25,000
Karl, Stefan 02/20/98 10,000 10,000
Karle, Erhard 09/29/97 3,000 3,000
Karle, Erhard 02/20/98 2,500 2,500
Karow, Michael 09/29/97 10,000 10,000
Karow, Michael 11/18/97 5,000 5,000
Kasberger, Siegfried 09/29/97 6,000 6,000
Kasberger, Siegfried 02/20/98 7,000 7,000
Kilgus, Guenther E. 09/29/97 9,000 9,000
Kiwan, Anis 09/29/97 5,000 5,000
Kiwan, Anis 02/20/98 10,000 10,000
Klingelhoefer, Ralf 09/29/97 7,500 7,500
Klingner, Dr. Walter 02/20/98 5,000 5,000
Koblitz, Siegmar 09/29/97 3,000 3,000
Koenig, Kurt 09/29/97 10,000 10,000
Koehler, Franz-Josef 02/20/98 5,000 5,000
Kompauer, Fred 09/11/97 6,000 6,000
Kopplin, Karl-Heinz 09/29/97 2,000 2,000
Kopplin, Karl-Heinz 02/20/98 2,000 2,000
Kreckel, Reinhard 09/29/97 10,000 10,000
Kreienbuehl, Beat 09/29/97 5,000 5,000
Kreienbuehl, Beat 02/20/98 2,500 2,500
Kubler, Hans-Joerg 09/29/97 3,000 3,000
Kuenzlen, Martin 10/17/97 3,000 3,000
Langreck, Ingo 09/29/97 2,000 2,000
Lebbe, Agnes 02/20/98 5,000 5,000
Leimlehner, Sabine 09/29/97 5,000 5,000
- 21 -
<PAGE>
Leimlehner, Sabine 02/20/98 2,500 2,500
Lembo, Lawrence 08/18/97 5,000 5,000
Lenz, Siegfried 09/28/97 8,000 8,000
Lenz, Siegfried 02/20/98 4,000 4,000
Lindzon, Howard 10/03/96 25,000 25,000
Lindzon, Sandra 10/03/96 25,000 25,000
Loibl, Nicolas 09/29/97 3,000 3,000
Luerzer, Walter 10/17/97 30,000 30,000
Maschmeyer, Hainfried 09/29/97 5,000 5,000
Massman, Sheila 10/28/96 5,000 5,000
Mertens, Helmut 02/20/98 5,000 5,000
Meyer, Friedel 09/29/97 5,000 5,000
Meyers, Mark 09/03/97 10,000 10,000
Miller, Kenneth J. 03/15/97 5,000 5,000
Mishkin, Keith 02/12/97 25,000 25,000
Mitcham, Franklin D. 09/19/96 5,000 5,000
Micham Profit Sharing
Plan, Franklin D. 12/23/96 15,000 15,000
Mueller, Dr. Christian 09/29/97 3,000 3,000
Neff, Peter & Michele 09/11/96 10,000 10,000
Neth, Claus 09/29/97 35,000 35,000
Oettinger, Helmut 02/20/98 3,000 3,000
Obraczka, Michael 09/11/97 20,000 20,000
Oehler, Fritz 09/29/97 5,000 5,000
Ott, Franz 02/20/98 3,000 3,000
Petrotta, Gianmaria 02/20/98 5,000 5,000
Pralow, Uta 09/29/97 8,000 8,000
Pronk, Fillippus 09/29/97 4,000 4,000
Ranke, Stef 11/15/96 15,000 15,000
Rauch, Dr. Juergen 09/29/97 5,000 5,000
RB Advancement, Inc. 09/29/97 10,000 10,000
Reilly, James A. 06/30/97 10,000 10,000
Reimann, Dr. Peter 09/29/97 10,500 10,500
Reimers, Karl-Heinz 09/29/97 5,000 5,000
Reimers, Karl-Heinz 02/20/98 1,000 1,000
Rieth, Mark F. 11/29/96 10,000 10,000
Roberts, Richard B. 04/03/97 12,500 12,500
Roberts Family Trust
George R. & Gail M. 04/03/97 12,500 12,500
Roberts Family Trust
Peter W. & Patricia A. 04/03/97 12,500 12,500
Roberts Family Trust
Thomas R. & Stacey A. 04/03/97 12,500 12,500
Roggensack, Peter 09/29/97 3,000 3,000
Roussinos, Michael 09/29/97 2,360 2,360
Roussinos, Michael 01/07/98 17,640 17,640
Ruetten, Ludger 03/15/97 10,000 10,000
Rugolos, JTWROS,
Barbara Jane & Louis 08/18/97 25,000 25,000
Saplis, Jeff 10/16/96 25,000 25,000
Saplis, Jeff 07/01/97 25,000 25,000
Sargon, Channa 10/28/96 5,000 5,000
- 22 -
<PAGE>
Sattari, Schanin 09/29/97 11,000 11,000
Sauer, Juergen 09/29/97 4,000 4,000
Schattinger, Vinzenz 09/29/97 100,000 100,000
Schechter, Shai 10/28/96 10,000 10,000
Schenk, Gerhard 09/29/97 3,000 3,000
Schenk, Gerhard 02/20/98 3,000 3,000
Schippel, Dr. Karl W. 09/11/97 70,475 70,475
Schippel, Dr. Karl W. 02/20/98 42,000 42,000
Schmalt, Peter 09/29/97 3,000 3,000
Schmauss, Fred 09/16/96 5,000 5,000
Schoensiegel, Hans-Peter 09/29/97 10,000 10,000
Scholz, Erich 09/29/97 12,000 12,000
Schumann, Klaus 09/29/97 3,000 3,000
Schusser, Heidi 02/20/98 5,000 5,000
Schwabe, K. 02/20/98 3,500 3,500
Schwanitz, Achim 09/29/97 3,000 3,000
Schweizer, Edgar 01/07/98 250,000 250,000
Seiz, Walter 06/16/97 65,000 65,000
Sernaker, Sandy 10/28/96 5,000 5,000
Sifferlinger, Peter 09/29/97 5,000 5,000
Smee, Judy M. 08/12/97 10,000 10,000
Sorenson, Alfred R. 08/22/97 10,000 10,000
Spens, Guenther 11/25/97 7,800 7,800
Stang, Klaus 09/29/97 6,000 6,000
Stelter, Martin 11/18/97 3,000 3,000
Stollenmeier, Kurt 02/20/98 5,000 5,000
Suleiman, David 02/20/98 4,600 4,600
Susser, Norman 10/07/97 10,000 10,000
Teuber, Udo 09/29/97 7,000 7,000
Tortora, Eleanor 02/12/97 25,000 25,000
Tradepack, Inc. 04/29/97 20,000 20,000
Traum, Joerg 09/29/97 3,000 3,000
Trentin, Rainer 09/29/97 10,000 10,000
Van Maanen, F.E. 09/29/97 5,000 5,000
VanSickle, John & Lisa 08/23/97 37,000 37,000
VanSickle, Joseph W. 08/23/97 10,000 10,000
VanSickle in trust for
Breanna L.; John W. 08/23/97 10,000 10,000
VanSickle, in trust for
Michael A. 08/23/97 10,000 10,000
Van Woensel, Guido 02/20/98 3,000 3,000
Vogel, Edletraud 09/29/97 5,000 5,000
Vogel, Walter 03/05/97 100,000 100,000
Vogel, Guenther 09/29/97 3,000 3,000
Vogel, Guenther 02/20/98 5,000 5,000
VonHahn, Cecile 10/02/97 5,000 5,000
Wagner, Thorsten 09/29/97 100,000 100,000
Wagner, Thorsten 01/07/98 100,000 100,000
Wattnem, Shelly 10/28/96 5,000 5,000
Wattnem Revocable Trust,
Bonnie May 10/28/96 30,000 30,000
Wattnem Revocable Trust,
- 23 -
<PAGE>
Bonnie May 12/23/96 20,000 20,000
Wattnem Revocable Trust,
Bonnie May 04/15/97 30,000 30,000
Welle, Dr. Oliver 09/29/97 33,750 33,750
Welle, Dr. Oliver 01/07/98 10,500 10,500
Wende, Goetz 10/17/97 6,000 6,000
Wendler, Ralf 08/04/97 10,000 10,000
Wenzel, Jutta 09/29/97 1,500 1,500
Werner, Kurt 09/29/97 5,000 5,000
Wibbelink, J. 01/07/98 25,000 25,000
Wild, Ernst 09/11/97 10,000 10,000
Wild, Ernst 09/29/97 10,000 10,000
Winham Trust, Kenneth C.
and Vicky L. 03/15/97 10,000 10,000
Winkler, Ferdinand 02/20/98 5,000 5,000
Wirrig, Steven R. 09/19/96 5,000 5,000
Wobig, Thorsten 09/29/97 5,000 5,000
Wolpert, Bernd 03/26/97 20,000 20,000
Wonschik, Dr. Christo 02/20/98 3,000 3,000
Wundersee, Dr. Wolf 02/20/98 3,000 3,000
Zehendner, Christian 09/29/97 10,000 10,000
Zindel, Holger 02/20/98 3,600 3,600
Zeisberg, Gerald 09/29/97 6,000 6,000
_________________________________________________________________________
4,427,240 4,427,240
(1) All securities are Common Shares. All holders have a one for two
warrant to acquire one half of the shares currently owned, as depicted
above, at the OTC Electronic Bulletin Board initial trading price which was
$2.00 per share.
(2) Consideration received was $1.00 per share in each instance.
(3) Each share sold was sold in reliance upon certain exemptions from the
registration provisions of Section 5 of the Securities Act of 1933. These
exemptions include Rules 505 and 506 of Regulation D promulgated under
Sections 3(b) and 4(2) in that each purchaser was provided with a private
placement memorandum describing all material information about the Company
and which complied with the model form contained in Form 1-A for such
documents and the offering amount was within the limits permitted by such
rules.
ITEM 11. DESCRIPTION OF SECURITIES
Common Stock: The Company is authorized to issue up to 25,000,000 shares
of its $.001 par value common stock. Each share is entitled to one vote on
matters submitted to a vote of the shareholders of the Company. There is
no cumulative voting of the common stock. The common stock shares have no
redemption provisions nor any preemptive rights. As of March 31, 1998,
there were 12,131,134 shares outstanding.
- 24 -
<PAGE.
ITEM 12. INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Company's By-laws at Article V. provide that every person who was or is
a party or is threatened to be made a party to or is involved in any
action, suit or proceeding, whether civil, criminal, administrative or
investigative, by reason of the fact that he or a person from whom he is
the legal representative is or was a director or officer of the corporation
or is or was serving at the request of the corporation or for its benefit
as a director or officer of another corporation, or as its representative
in a partnership, joint venture, trust or other enterprise, shall be
indemnified and held harmless to the fullest extent legally permissible
under the General Corporation Law of the State of Nevada against all
expenses, liability and loss (including attorney's fees, judgments, fines
and amounts paid or to be paid in settlement) reasonably incurred or
suffered by him in connection therewith.
ITEM 13. FINANCIAL STATEMENTS
The Financial Statements are set forth below, after Item 15, and include
audited financial statements for the fiscal years ended September 30, 1997,
and September 30, 1996, and unaudited financial statements for the three
month periods ended December 31, 1997, and 1996.
(i) Consolidated Financial Statements Renaissance International Group,
Ltd. for Fiscal Years Ended September 30, 1997 and 1996.
(ii) Interim Consolidated Financial Statements for the Periods Ended
December 31, 1997, and 1996, - Unaudited
ITEM 14. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
There have been no disagreements on accounting and financial disclosures
from the inception of the Company through the date of this Registration
Statement.
ITEM 15. INDEX TO EXHIBITS
3. (i) Articles of Incorporation
(ii) Bylaws
10. Material Contracts
(i) Employment Agreement Among Kevin Jones and Renanissance
International Group, Ltd.
(ii) Employment Agreement Among Peter de Krey and Renaissance
International Group, Ltd.
(iii) Employment Agreement Among James Jones and Renaissance
International Group, Ltd.
(iv) Employment Agreement Among John A. Wiliams and
- 25 -
<PAGE>
Renaissance International Group, Ltd.
(v) Employment Agreement Among William D. O'Neal and
Renaissance International Group, Ltd.
(vi) Memorandum of Understanding Among Tennessee Webb and
Renaissance International Group, Ltd.
(vii) The Contract among MDI of Arizona and the Company
(viii) The Contract among Medasys System and the Company
21. (i) Subsidiaries of the Registrant
23. (i) Consent of Experts
27. (i) Financial Data Schedule
- 26 -
<PAGE>
RENAISSANCE INTERNATIONAL GROUP, LTD.
(A Development Stage Company)
CONSOLIDATED FINANCIAL STATEMENTS
AS OF DECEMBER 31, 1997 AND 1996
- 27 -
<PAGE>
RENAISSANCE INTERNATIONAL GROUP, LTD.
(A Development Stage Company)
CONTENTS
Page
Number
Consolidated Balance Sheets as of December 31, 1997
and September 30, 1997 3
Consolidated Statements of Operations for the three months
ended December 31, 1997 and 1996 4
Consolidated Condensed Statements of Cash Flows for the three
months ended December 31, 1997 and 1996 5
Notes to Consolidated Financial Statements 6-9
- 28 -
<PAGE>
RENAISSANCE INTERNATIONAL GROUP, LTD.
CONSOLIDATED BALANCE SHEETS
(A Development Stage Company)
December 31, September 30,
1997 1996
------------ ------------
(unaudited)
ASSETS
- ------
Current assets:
Cash and cash equivalents $2,064,289 $ 841,702
Accounts receivable - -
Other receivables 5,539 5,342
---------- ----------
Total current assets 2,069,828 847,044
Property and equipment 106,200 87,510
Less accumulated depreciation (23,172) (15,814)
---------- ----------
Net property and equipment 83,028 71,696
Other Assets
Organization costs 1,560 1,560
Shareholder loans 150,141 105,841
Other interest bearing loans 40,000 70,000
Proprietary technology 13,000 13,000
Technology rights - 10,000
Deposits 790 790
Less accumulated amortization (390) (812)
---------- ----------
Net other assets 205,101 200,379
---------- ----------
Total assets $2,357,957 $1,119,119
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
- ------------------------------------
Current liabilities:
Accounts payable $ 227,153 $ 4,708
Accrued payroll taxes 24,087 22,715
Due to shareholders 2,460 5,103
---------- ----------
Total current liabilities 253,700 32,526
Commitments and contingencies
Stockholders' equity:
Preferred stock; $.001 par value;
authorized 15,000,000 shares,
Series A, 3,000,000 authorized:
Shares subscribed; 638,400 at
September 30, 1997 638
Shares issues and outstanding;
2,361,600 at September 30, 1997 2,362
Series A.1, 2,000,000 authorized:
Shares subscribed; 1,038,778 at
December 31, 1997 1,039
Additional paid-in-capital 1,037,739 2,934,500
Subscriptions receivable (1,038,778) (638,400)
---------- ----------
Total preferred stock - 2,299,100
---------- ----------
Common stock; $.001 par value; authorized
25,000,000 shares; issued and outstanding:
10,583,752 and 6,537,530 shares at
December 31, 1997 and at September 30,
1997, respectively 10,584 6,537
Additional paid-in capital 4,065,358 365,005
Subscriptions receivable - (800)
---------- ----------
Total common stock 4,075,942 370,742
---------- ----------
Accumulated deficit (1,971,685) (1,583,249)
---------- ----------
Total stockholders' equity 2,104,257 1,086,593
---------- ----------
Total liabilities and
stockholders' equity $2,357,957 $1,119,119
========== ==========
See accompanying notes to these consolidated financial statements.
- 29 -
<PAGE>
RENAISSANCE INTERNATIONAL GROUP, LTD.
CONSOLIDATED STATEMENTS OF OPERATIONS
(A Development Stage Company)
(unaudited)
Three Months Ended
----------------------------
December 31, December 31,
1997 1996
------------ ------------
REVENUE
Corporate revenue $ 1,550 $ 12,500
Royalty income 32 202
---------- ----------
Total revenue 1,582 12,702
DIRECT EXPENSE - -
---------- ----------
GROSS PROFIT 1,582 12,702
GENERAL & ADMINISTRATIVE EXPENSE 378,951 274,604
---------- ----------
NET OPERATING INCOME (LOSS) (377,369) (261,902)
Depreciation and amortization (26,936) (1,384)
Interest income 15,869 849
---------- ----------
Net income (loss) $ (388,436) $ (262,437)
========== ==========
Basic EPS $ (0.04) $ (0.04)
========== ==========
Diluted EPS $ (0.04) $ (0.04)
========== ==========
See accompanying notes to these consolidated financial statements.
- 30 -
<PAGE>
RENAISSANCE INTERNATIONAL GROUP, LTD.
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(A Development Stage Company)
(unaudited)
Three Months Ended
----------------------------
December 31, December 31,
1997 1996
------------ ------------
CASH FLOWS PROVIDED BY (USED IN)
OPERATING ACTIVITIES:
Net cash provided by (used in)
operating activities $ (349,145) $ (294,266)
---------- ----------
CASH FLOWS PROVIDED BY (USED IN)
INVESTING ACTIVITIES:
Capital expenditures (18,690) (27,199)
Expenditures to acquire intangible
assets (10,000) (1,560)
---------- ----------
Net cash provided by (used in)
investing activities (28,690) (28,759)
---------- ----------
CASH FLOWS PROVIDED BY (USED IN)
FINANCING ACTIVITIES:
Proceeds from issuance of common stock 800
Proceeds from issuance of preferred stock 1,599,622 536,000
---------- ----------
Net cash provided by (used in)
financing activities 1,600,622 536,000
---------- ----------
Net increase in cash and cash equivalents 1,222,587 212,975
Cash and cash equivalents at beginning
of period 841,702 9,345
---------- ----------
Cash and cash equivalents at end of period $2,064,289 $ 222,320
========== ==========
See accompanying notes to these consolidated financial statements
- 31 -
<PAGE>
RENAISSANCE INTERNATIONAL GROUP, LTD.
(A Development Stage Company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1 - ORGANIZATION AND NATURE OF BUSINESS
a. Organization of business
The Company was incorporated as Nuclear Corporation of New Mexico (NCNM) in
December 1968 for the purpose of mineral, oil and gas exploration.
$300,000 was initially raised for exploration activities and NCNM remained
active in this business until 1974. Since 1974, NCNM has been
substantially inactive, receiving only residual income from over-riding
royalty interest in oil and gas leases.
In April, 1994 NCNM moved its domicile from the state of New Mexico to
Nevada. From that period until its combination with Renaissance Center,
Inc. (RenCen) NCNM remained substantially inactive.
The management of RenCen instituted a 1 for 2 reverse split of its common
stock held by management prior to the combination with NCNM. Subsequently,
RenCen decreased the number of authorized shares of common stock, par value
$.001, from 50 million to 25 million shares. In addition, the number of
shares issued and outstanding were reduced on the basis of 1 for 2 with any
scrip shares created as a result of the reverse rounded up to the next
whole share. No reduction or alterations were made to the preferred shares
of RenCen.
This business combination was accounted for as a pooling of interest. The
name of the merged companies was changed to Renaissance International
Group, Ltd (the Company) on July 2, 1997.
Subsequent to the reverse split and prior to the combination with NCNM, the
outstanding common shares of RenCen were 5,025,980 shares and were
distributed as follows:
Shares issued for proprietary technology 3,632,916
Shares issued for cash 1,010,814
Shares issued for services 382,250
---------
Total shares issued 5,025,980
---------
b. Nature of business
The Company, through its subsidiary, RenCen owns a proprietary technology
developed by an officer of the Company for the integration of equipment and
components in high-tech digital multimedia studios.
Management has recognized that recent developments in data storage devices
and optical transmission capabilities have greatly increased the capability
to transfer, store and retrieve data. Hierarchical communication languages
can be used to develop software applications which will make real-time
access of this information a reality as well as adding artificial
intelligence to core operating systems.
These recent developments, combined with the Company's own state-of-the-art
proprietary technology have enabled it to look at alternative applications.
Management believes that the health services industry may provide this
alternative. This industry, though technically advanced in equipment,
relies upon out dated record keeping and retrieval methods. The Company is
actively pursuing acquisitions in the medical industry. Initially it has
targeted physician groups, outpatient surgical centers, skilled nursing
facilities and medical specialty organizations. It is management's
intention to continue to examine all industries for possible applications
of its proprietary technology as well as looking for opportunities to
acquire other synergistic technologies.
- 32 -
<PAGE>
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
a. Principles of Consolidation
The consolidated financial statements include the accounts of the Company
and its wholly owned subsidiaries. All material intercompany transactions
and balances have been eliminated in consolidation.
b. Accounting Method
The Company recognizes income and expenses based upon the accrual method of
accounting. No allowances have been made for doubtful accounts as all
revenues recognized to date have been collected.
c. Unaudited Information and Basis of Presentation
The consolidated balance sheet as of December 31, 1997 and statements of
operations and condensed cash flows for all periods included in the
accompanying financial statements have not been audited. In the opinion of
management these financial statements include all normal and recurring
adjustments necessary for a fair presentation of such financial
information. The results of operations for the interim periods are not
necessarily indicative of the results of operations to be expected for the
full year.
The financial information included herein has been prepared pursuant to the
rules and regulations of the Securities and Exchange Commission. Certain
information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting
principles have been omitted pursuant to such rules and regulations. The
interim financial information and the notes thereto should be read in
conjunction with the audited financial statements for the fiscal years
ended September 30, 1997, September 30, 1996 and September 30, 1995 which
are included in the Company's 1996 Annual Report to Stockholders.
d. Property and Equipment
Property and equipment are stated at cost. Depreciation is computed using
the straight-line method over the useful lives of the assets as follows:
Furniture and equipment 5-7 years
Automobiles 5 years
e. Income Taxes
The Company, a C Corporation, accounts for income taxes in accordance with
Statement of Financial Accounting Standards No. 109 (Accounting for Income
Taxes).
The Company has not recorded a provision for income taxes to date, since
the Company has generated operating losses. As of September 30, 1997, the
Company has approximately $1,580,000 of net operating loss carry forwards
which can be used to offset future taxable income.
f. Management's Estimates and Assumptions
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
disclosure of contingent assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those
estimates.
g. Recent Accounting Pronouncements
In February 1997, SFAS No. 128, "Earnings per Share" ("SFAS 128") was
issued. Under SFAS 128, primary earnings per share is replaced by basic
earnings per share and fully diluted earnings per share is replaced by
diluted earnings per share.
- 33 -
<PAGE>
In June 1997, SFAS No. 130, "Reporting Comprehensive Income" ("SFAS 130")
was issued. SFAS 130 establishes standards for the reporting of
comprehensive income and its components in a full set of general-purpose
financial statements for periods beginning after December 15, 1997.
Reclassification of financial statements for earlier periods for
comparative purposes is required.
In June 1997, SFAS No. 131, "Disclosures about Segments of an Enterprise
and Related Information" ("SFAS 131") was issued. SFAS 131 revises
information regarding the reporting of operating segments. It also
establishes standards for related disclosures about products and services,
geographic areas and major customers.
The Company adopted SFAS 128 in the first quarter of fiscal 1998 and SFAS
130 and SFAS 131 in fiscal 1999 and does not expect such adoptions to have
a material effect on the consolidated financial statements and footnotes.
NOTE 3 - OTHER ASSETS
Other assets consist of organization cost, shareholder loans, interest
bearing loans to third parties, proprietary technology rights and deposits.
Organization costs and deposits are nominal.
The loans to shareholders and interest bearing loans to third parties all
bear interest at rates substantially above Arizona bank depository rates.
The investment in proprietary technology is considered a nominal amount and
was based upon the par value of the original shares issued. The
proprietary technology was transferred to the Company by principals. The
technology represents the blueprint and foundation for the digital high-tech
studio as well as its application in handling, managing and storing
mega-data. The Company is in the review process with a patent attorney for
filing of applications for patents and copyrights on this technology.
The Company optioned the right to patented Optical Collision Avoidance
System (O-CAS) from its inventor for $20,000. These technology rights were
written off in the quarter ended December 31, 1997 as these rights were no
longer considered to have value to the Company.
NOTE 4 - SHAREHOLDERS' EQUITY
During the quarter ended December 31, 1997, the Company completed the
following stock transactions from its authorized but unissued capital
shares:
Payments in the amount of $1,599,622 were received on the Series A
and A.1 preferred stock subscriptions and $800 received on common
stock subscriptions. Costs and expenses relating to the sales of
these shares totaled $219,322. The preferred shares carry a
conversion to common on a one for one basis and 3,961,222 were
converted during the quarter ended December 31, 1997.
The Company issued 25,000 shares in exchange for services rendered.
During the year ended September 30, 1997, the Company completed the
following stock transactions from its authorized but not unissued capital
shares:
Payments in the amount of $2,266,600 were received in Series A
preferred stock subscriptions and $2,760 received on common stock
subscriptions. Costs and expenses relating to the sale of these
shares totaled $62,500 of which $60,000 was converted into common
shares, during the quarter ended December 31, 1997, at the request of
the selling agents.
The Company issued 217,250 common shares for services rendered.
Effective October 22, 1997 warrants were issued to existing stockholders to
acquire 1,868,150 preferred shares at a price of $2.00 per share and
750,000 common shares at a price of $2.30 per share. The warrants expire
on October 30, 1999. The Company granted certain of its executive officers
and other individuals options to purchase shares of the Company's common
stock. At December 31, 1997 options to purchase 511,730 shares of common
stock were outstanding.
- 34 -
<PAGE>
NOTE 5 - EARNINGS PER SHARE
In February 1997 the Financial Accounting Standards Board ("FASB") issued
Statement of Financial Accounting Standards ("SFAS") No. 128, "Earnings Per
Share," which is effective for financial statements for both interim and
annual periods ending after December 15, 1997. The new standard eliminates
primary and fully dilutive earnings per share and requires presentation of
basic and diluted earnings per share with disclosures of the methods used
to compute the per share amounts.
Basic earnings per share excludes dilution and is computed by dividing
income available to common shareholders by the weighted-average common
shares outstanding for the period. Diluted earnings per share reflects the
weighted-average common shares outstanding plus the potential effect of
securities or contracts which are convertible to common shares such as
options, warrants, and convertible debt and preferred stock. The adoption
of this standard is not expected to have a material impact on earnings per
share of the Company. In computing Diluted EPS, the average stock price for
the period is used in determining the number of shares assumed to be
purchased from exercise of stock options rather than the higher of the
average or ending stock price as used in the computation of fully diluted
EPS.
The following is a reconciliation between the components of the basic and
diluted net income (loss) per share calculations for the periods presented
below:
<TABLE>
<CAPTION
THREE MONTHS ENDED:
DECEMBER 31, 1997 DECEMBER 31, 1996
--------------------------------- ---------------------------------
INCOME SHARES PER INCOME SHARES PER
SHARE SHARE
AMOUNT AMOUNT
-------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
BASIC INCOME (LOSS) PER
SHARE
Net income (loss) $(383,436) 9,161,674 $(0.04) $(262,437) 6,013,280 $(0.04)
======= =======
EFFECT OF DILUTIVE SECURITIES
Stock options/warrants
---------- --------- ---------- ---------
DILUTED NET INCOME (LOSS)
PER SHARE
Net income (loss) plus
assumed exercises and
conversions $(383,436) 9,161,674 $(0.04) $(262,437) 6,013,280 $(0.04)
========== ========= ======= ========== ========= =======
</TABLE>
- 35 -
<PAGE>
RENAISSANCE INTERNATIONAL GROUP, LTD.
(Formerly known as Nuclear Corporation of New Mexico)
(A Development Stage Company)
CONSOLIDATED FINANCIAL STATEMENTS
AS OF SEPTEMBER 30, 1997 AND 1996
TOGETHER WITH REPORT OF INDEPENDENT PUBLIC ACCOUNTANT
-1-
- 36 -
<PAGE>
BILLIE J. ALLRED
Certified Public Accountant
- -------------------------------------------------------------------------
365 South 600 East (Alder Lane)
Post Office Box 1142
Pima, Arizona 85543
Telephone (520) 485-9462
Fax (520) 485-0105
INDEPENDENT AUDITOR'S REPORT
To the Shareholders and Board of Directors of
Renaissance International Group, Ltd.
I have audited the accompanying balance sheets of Renaissance International
Group Ltd., a development stage company, as of September 30, 1997 and 1996
and the related consolidated statements of operations and cash flows for
the years ended September 30, 1997, 1996 and 1995. These consolidated
financial statements are the responsibility of the Company's management.
My responsibility is to express an opinion on these consolidated financial
statements based upon my audits.
I conducted my audits in accordance with generally accepted auditing
standards. These standards require that I 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. I believe that my audits
provide a reasonable basis for my opinion.
In my opinion, the consolidated financial statements referred to above
present fairly in all material respects the financial position of
Renaissance International Group, Ltd. as of September 30, 1997 and 1996 and
the results of their operations and cash flows for the years ended
September 30, 1997, 1996 and 1995 in conformity with generally accepted
accounting principles.
The accompanying consolidated financial statements have been prepared
assuming the Company will continue as a going concern. As discussed in
Note 1, the Company has been in the development stage since October 1,
1994. At September 30, 1997 the Company has accumulated operating losses
of $1,580,000. Realization of a major portion of the Company's assets is
dependent upon its ability to meet future financing requirements, and the
success of future operations, the outcome of which cannot be determined at
this time.
S/S/ BILLIE J. ALLRED
Pima, Arizona
January 6, 1998
-2-
- 37 -
<PAGE>
RENAISSANCE INTERNATIONAL GROUP, LTD.
(Formerly known as Nuclear Corporation of New Mexico)
(A Development Stage Company)
CONSOLIDATED BALANCE SHEETS
September 30, 1997 and 1996
1997 1996
------------ ------------
CURRENT ASSETS
Cash $ 841,702 $ 9,345
Accounts receivable - -
Other receivables 5,342 -
---------- ----------
Total current assets 847,044 9,345
---------- ----------
PROPERTY AND EQUIPMENT 87,510 -
Less accumulated depreciation (15,814) -
---------- ----------
Net property and equipment 71,696 -
OTHER ASSETS (Note 3)
Organization costs 1,560 -
Shareholder loans, net 105,841 -
Other interest bearing loans 70,000 -
Proprietary technology 13,000 13,000
Technology rights 10,000 -
Deposits 790 -
---------- ----------
Total other assets 201,191 13,000
Less accumulated amortization (812) -
---------- ----------
Net other assets 200,379 13,000
---------- ----------
TOTAL ASSETS $1,119,119 $ 22,345
========== ==========
The accompanying notes are an integral part of these statements.
-3-
- 38 -
<PAGE>
RENAISSANCE INTERNATIONAL GROUP, LTD.
(Formerly known as Nuclear Corporation of New Mexico)
(A Development Stage Company)
CONSOLIDATED BALANCE SHEETS
September 30, 1997 and 1996
1997 1996
------------ ------------
CURRENT LIABILITIES
Accounts payable $ 4,708 $ -
Accrued payroll taxes 22,715 -
Shareholder loans 5,103 100
---------- ----------
Total current liabilities 32,526 100
COMMITMENTS (Note 4) - -
STOCKHOLDERS' EQUITY (Notes 5, 6 and 7)
Preferred stock, $.001 par value
15,000,000 shares authorized
Series A, 3,000,000 shares authorized
Shares subscribed:
638,400 shares at September 30, 1997 638 -
2,965,000 shares at September 30, 1996 - 2,965
Shares issued and outstanding:
2,361,600 shares at September 30, 1997 2,362 -
35,000 shares at September 30, 1996 - 35
Additional paid in capital 2,934,500 2,997,000
Subscriptions receivable (638,400) (2,965,000)
---------- ----------
Total preferred stock 2,299,100 35,000
---------- ----------
COMMON STOCK, $.001 par value
25,000,000 shares authorized
Shares issued and outstanding:
6,537,530 shares at September 30, 1997 6,537 -
6,013,280 shares at September 30, 1996 6,013
Additional paid-in-capital 365,005 345,305
Subscriptions receivable (800) (3,470)
---------- ----------
Total common stock 370,742 347,848
---------- ----------
Accumulated (deficit) (1,583,249) (360,602)
---------- ----------
Total stockholders' equity 1,086,593 22,245
---------- ----------
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $1,119,119 $ 22,345
========== ==========
The accompanying notes are an integral part of these statements.
-4-
- 39 -
<PAGE>
RENAISSANCE INTERNATIONAL GROUP, LTD.
(Formerly known as Nuclear Corporation of New Mexico)
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF OPERATIONS
For Years Ended September 30, 1997, 1996 and 1995
<TABLE>
<CAPTION>
Cumulative
Amounts from
1997 1996 1995 October 1, 1994
---------- ---------- ---------- ---------------
<S> <C> <C> <C> <C>
REVENUE
Corporate revenue $ 35,450 $ - $ - $ 35,450
Royalty income 1,092 1,341 797 3,230
---------- ---------- ---------- ----------
Total Revenue 36,542 1,341 797 38,680
DIRECT EXPENSE (10,542) (680) (368) (11,590)
---------- ---------- ---------- ----------
GROSS PROFIT 26,000 661 429 27,090
GENERAL & ADMINISTRATIVE
EXPENSE (1,249,995) (28,538) (334) (1,278,867)
---------- ---------- ---------- ----------
NET OPERATING INCOME (LOSS) (1,223,995) (27,877) 95 (1,251,777)
Depreciation & Amortization (16,626) - - (16,626)
OTHER INCOME (EXPENSE)
Interest income (expense) 17,975 - - 17,975
---------- ---------- ---------- ----------
NET INCOME (LOSS) $(1,222,646) $ (27,877) $ 95 $(1,250,428)
========== ========== ========== ==========
Weighted average number of shares
outstanding during period 7,296,680 1,374,293 987,300
---------- ---------- ----------
NET EARNINGS (LOSS) PER SHARE $ (0.1675) $ (0.0202) $ 0.00
========== ========== ==========
</TABLE>
The accompanying notes are an integral part of these statements.
-5-
- 40 -
<PAGE>
RENAISSANCE INTERNATIONAL GROUP, LTD.
(Formerly known as Nuclear Corporation of New Mexico)
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF CASH FLOWS
For Years Ended September 30, 1997, 1996 and 1995
<TABLE>
<CAPTION>
1997 1996 1995
---------- ---------- ----------
<S> <C> <C> <C>
CASH FLOW FROM OPERATING ACTIVITIES:
Net income (loss) $(1,222,646) $ (27,877) $ 95
Adjustments to reconcile net
income (loss) to net cash used
in operating activities:
Depreciation 15,814 - -
Amortization 812 - -
Shares issued in exchange for
services 217 1,515 -
Selling expenses for preferred
stock (2,500) - -
(Increase) decrease in current assets:
Prepaid expenses 197 - -
Interest receivable (5,539) - -
Increase (decrease) in current
liabilities:
Accounts payable 4,707 - -
Other current liabilities 27,715 - -
---------- ---------- ----------
Total adjustments 41,424 1,515 -
---------- ---------- ----------
Net cash provided by (used in)
operating activities (1,181,222) (26,363) 95
CASH FLOW FROM INVESTING ACTIVITIES:
Additions to:
Organization costs (1,560) - -
Property and equipment (87,510) - -
Technology rights (10,000) - -
Deposits (790) - -
Loans for shareholders (105,841) - -
Interest bearing loans to
third parties (70,000) - -
---------- ---------- ----------
Net cash provided by (used in)
investing activities: (275,701) - -
CASH FLOW FROM FINANCING ACTIVITIES:
Loans from shareholders 103 100 -
Payments on loans (100) - -
Issuance of Common Stock for cash 20,007 - -
Payments received on common stock
subscriptions 2,670 250 -
Payments received on preferred
stock subscriptions 2,266,600 35,000 -
---------- ---------- ----------
Net cash provided by (used in)
financing activities: 2,289,280 35,350 -
---------- ---------- ----------
NET INCREASE (DECREASE) IN CASH 832,358 8,987 95
CASH AT BEGINNING OF PERIOD 9,345 358 263
---------- ---------- ----------
CASH AT END OF PERIOD $ 841,703 $ 9,345 $ 358
========== ========== ==========
</TABLE>
The accompanying notes are an integral part of these statements.
-6-
- 41 -
<PAGE>
RENAISSANCE INTERNATIONAL GROUP, LTD.
(Formerly known as Nuclear Corporation of New Mexico)
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF CASH FLOWS
For Years Ended September 30, 1997, 1996 and 1995
<TABLE>
<CAPTION>
1997 1996 1995
---------- ---------- ----------
<S> <C> <C> <C>
Supplemental disclosure of non-cash
operating, investing and financing
activities
Issuance of common stock on
subscriptions receivable to
contractors and employees as
part of signing incentive $ - $ 3,470 $ -
Issuance of common stock for
assignment of proprietary
technology - 13,000 -
Subscriptions receivable for
Series A Preferred Stock 638,400 2,429,000 -
Treasury shares acquired
pre-merger as bonus to key
employees 20,000 - -
Series A Preferred Stock Additional
Paid in Capital for commissions due (60,000) - -
Issuance of Series A Preferred Stock
as payment of commissions due 60,000 - -
</TABLE>
The accompanying notes are an integral part of these statements.
-7-
- 42 -
<PAGE>
RENAISSANCE INTERNATIONAL GROUP, LTD.
(Formerly known as Nuclear Corporation of New Mexico)
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
<TABLE>
<CAPTION>
Additional Subscription
Shares Stock Paid-In-Capital Receivable Totals
-------- ------- --------------- ---------- --------
<S> <C> <C> <C> <C> <C>
Balance at
September 30, 1995 -- $ -- $ -- $ -- $ --
Private placement of
Series A Preferred
Stock 3,000,000 3,000 2,997,000 (2,965,000) 35,000
--------------------------------------------------------------------------
Balance at
September 30, 1996 3,000,000 3,000 2,997,000 (2,965,000) 35,000
Payments received on
preferred stock
subscriptions -- -- -- 2,306,600 2,306,600
Selling expenses and
commissions -- -- (60,000) 60,000 --
Repurchase of
Series A Preferred Stock -- -- (2,500) (40,000) (42,500)
--------------------------------------------------------------------------
Balance at
September 30, 1997 3,000,000 $ 3,000 $2,934,500 $ (638,400) $2,299,100
==========================================================================
</TABLE>
<TABLE>
<CAPTION>
COMMON STOCK
Additional Retained
Paid-In- Subscription Earnings
Shares Stock Capital Receivable (Deficit) Totals
----------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Balance at
September 30, 1995 987,300 $ 987 $ 332,096 $ -- $ (332,725) $ 358
Issuance of shares for:
Business combination
(Note 1a) 5,025,980 5,026 13,209 (3,470) 14,765
Net income (loss) (27,877) (27,877)
----------------------------------------------------------------------------
Balance at
September 30, 1996 6,013,280 6,013 345,305 (3,470) (360,602) (12,755)
Payments received on
Common Stock
subscriptions 2,670 2,670
Issuance of shares
for:
Cash 307,000 307 19,700 20,007
Professional services 217,250 217 217
Net income (loss) (1,222,646) (1,222,646)
----------------------------------------------------------------------------
Balance at
September 30, 1997 6,537,530 $ 6,537 $ 365,005 $ (800) $(1,583,249) $(1,212,507)
============================================================================
</TABLE>
The accompanying notes are an integral part of these statements.
-8-
- 43 -
<PAGE>
RENAISSANCE INTERNATIONAL GROUP, LTD.
(Formerly known as Nuclear Corporation of New Mexico)
(A Development Stage Company)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
September 30, 1997
NOTE 1 ORGANIZATION AND NATURE OF BUSINESS
a. ORGANIZATION OF BUSINESS
The Company was incorporated as Nuclear Corporation of New Mexico (NCNM) in
December 1968 for the purpose of mineral, oil and gas exploration. $300,000
was initially raised for exploration activities and the Company remained
active in this business until 1974. Since 1974, the Company has been
substantially inactive, receiving only residual income from over-riding
royalty interests in oil and gas leases.
In April, 1994 the Company moved its domicile from the State of New Mexico
to Nevada. From that period until its merger with Renaissance Center, Inc.
(RenCen) on July 2, 1997 the Company remained inactive.
The management of RenCen instituted a 1 for 2 reverse split of its common
stock held by management prior to the merger. Subsequently, RenCen
decreased the number of authorized shares of common stock, par value $.001,
from 50,000,000 shares to 25,000,000. In addition, the number of shares
issued and outstanding were reduced on the basis of 1 for 2 with any scrip
shares created as a result of the reverse rounded up to the next whole
share. No reduction or alternations were made to the preferred shares of
RenCen.
This business combination is accounted for as a pooling of interests. The
name of the merged companies was changed to Renaissance International
Group, Ltd. on July 2, 1997.
Subsequent to the reverse split and prior to the merger, the outstanding
common shares of RenCen were 5,025,980 shares and were distributed as
follows:
Shares issued for proprietary technology 3,632,916
Shares issued for cash 1,010,814
Shares issued for services 382,250
---------
Total shares issued 5,025,980
---------
-9-
- 44 -
<PAGE>
RENAISSANCE INTERNATIONAL GROUP, LTD.
(Formerly known as Nuclear Corporation of New Mexico)
(A Development Stage Company)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
September 30, 1997
b. NATURE OF BUSINESS
The Company, through its subsidiary, Renaissance Center, Ltd. (RenCen) owns
a proprietary technology developed by a company officer for the integration
of equipment and components in high-tech digital multimedia studios. The
concept for the studio was developed under a contract awarded for the
submission of a request for proposal to Europaisches Filmzentrum Babelsberg
e.v. (EFB), a large multimedia studio in Babelsberg, Germany.
Management has recognized that recent developments in data storage devices
and optical transmission capabilities have greatly increased the capability
to transfer, store and retrieve data. Hierarchical communication languages
can be used to develop software applications which will make real-time
access of this information a reality as well as adding artificial
intelligence to core operating systems.
These recent developments, combined with the Company's own state-of-the-art
proprietary technology have enabled it to look at alternative applications.
Management believes that the health services industry may provide this
alternative. This industry, though technically advanced in equipment,
relies upon out dated record keeping and retrieval methods. The Company is
actively pursuing acquisitions in the medical industry. Initially it has
targeted physician groups, outpatient surgical centers, skilled nursing
facilities and medical specialty organizations. It is management's
intention to continue to examine all industries for possible applications
of it proprietary technology as well as looking for opportunities to
acquire other synergistic technologies.
NOTE 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
a. PRINCIPALS OF CONSOLIDATION
The consolidated financial statements include the accounts of the Company,
wholly owned subsidiaries, Renaissance MedTech, Ltd. (a Nevada corporation
which was incorporated April 17, 1997), Renaissance Center, Ltd. (a Nevada
corporation which was incorporated April 17, 1997) and Renaissance Media
Centre, Ltd. (a Delaware corporation which was incorporated May 7, 1996).
All significant inter-company balances and transactions have been
eliminated in the consolidation.
-10-
- 45 -
<PAGE>
b. PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment are stated at cost. Depreciation is computed
using the straight-line method over the useful lives of the assets as
follows:
Furniture and equipment 5-7 years
Automobiles 5 years
c. ACCOUNTING METHOD
The Company recognizes income and expenses based upon the accrual method of
accounting. No allowances have been made for doubtful accounts as all
revenues recognized to date have been collected.
d. INCOME TAXES
The Company, a C Corporation, accounts for income taxes in accordance with
the Statement of Financial Accounting Standards No. 109 (Accounting for
Income Taxes).
The Company has not recorded a provision for income taxes to date, since
the Company has generated operating losses. As of September 30, 1997, the
Company has approximately $1,580,000 of net operating loss carry forwards
which can be used to offset future taxable income.
e. NET INCOME (LOSS) PER SHARE
Net income (loss) per share has been calculated based on net losses for the
periods divided by the weighted average number of shares of common stock
outstanding during the periods presented. The weighted average number of
shares of common stock outstanding for the periods presented is:
Year Ended September 30, 1997 7,296,680
Year Ended September 30, 1996 1,374,293
Year Ended September 30, 1995 987,300
At September 30, 1997 the Company had issued and outstanding common shares
totaling 6,537,530 and Series A preferred shares totaling 2,361,600. The
preferred shares have been included because
-11-
- 46 -
<PAGE>
RENAISSANCE INTERNATIONAL GROUP, LTD.
(Formerly known as Nuclear Corporation of New Mexico)
(A Development Stage Company)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
September 30, 1997
a provision of the preferences on these shares is a one-to-one conversion
to common shares when the Company is publicly traded (See Note 6 Subsequent
Events).
f. 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, liabilities,
expenses and disclosures concerning contingent assets and liabilities at
September 30, 1997 and 1996. Actual result could differ from those
estimates.
NOTE 3 OTHER ASSETS
Other Assets consist of organization costs, shareholder loans, interest
bearing loans to third parties, proprietary technology, rights and
deposits. Organization costs and deposits are nominal.
The loans to shareholders and interest bearing loans to third parties all
bear interest at rates substantially above Arizona bank depository rates.
The investment in the proprietary technology of $13,000 is considered a
nominal amount and was based upon the par value of the original shares
issued. The proprietary technology was transferred to the Company by the
principals. The technology represents the blueprint and foundation for the
digital high-tech studio as well as its application in handling, managing
and storing mega-data. The Company is in the review process with a patent
attorney for filing of applications for patents and copyrights on this
technology.
The Company optioned the right to a patented Optical Collision Avoidance
System (O-CAS) from the inventor for $10,000. The 90 day option may be
extended for an additional $10,000 which is due and payable on December 2,
1997. The O-CAS proto type, as viewed by management, was built several
years ago and new microprocessor technology makes miniaturization of this
system feasible. The Company is in discussions with venture capital firms
to raise $2,000,000 through a convertible debenture to complete the
redesign and miniaturization of the system and to beta test the system.
Once a commercially viable product is available, management intends to
joint venture the production and sales and marketing with an existing
supplier in the aviation industry. (See Note 6)
-12-
- 47 -
<PAGE>
RENAISSANCE INTERNATIONAL GROUP, LTD.
(Formerly known as Nuclear Corporation of New Mexico)
(A Development Stage Company)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
September 30, 1997
NOTE 4 COMMITMENTS - LEASES
Effective May 1, 1997, the Company entered into a lease for 1,750 square
feet of corporate office space located at 7501 North 16th Street, Suite
200, Phoenix, Arizona. The lease is for a period of three years and
includes all expenses except telephone service. As of September 30, 1997
the Company has paid $14,280 on this lease. Future rental commitments are
as follows:
Year ending September 30, 1998 $ 34,272
Year ending September 30, 1999 34,272
Year ending September 30, 2000 19,992
--------
Total future lease commitments $ 88,536
========
NOTE 5 SHAREHOLDERS' EQUITY
During the year ended September 30, 1997, the Company completed the
following stock transactions from its authorized, but unissued capital
shares: (See Note 6 and 7)
Payments in the amount of $2,266,600 were received on Series A
Preferred Stock subscriptions and $2,670 received on common stock
subscriptions. Costs and expenses relating to the sale of these shares
totaled $62,500 of which $60,000 was converted into preferred shares
at the request of the selling agents.
The Company issued 217,250 common shares in exchange for services
rendered.
During the year ended September 30, 1996 the Company completed the
following stock transactions from its authorized but unissued capital
shares: (See Note 6 and 7)
The Company began a private placement of its Series A Preferred Stock
in September, 1996. The private placement is for 3,000,000 shares at
a price of $1.00 per share. These shares carry a conversion to common
on a 1 for 1 basis when the Company is publicly traded and listed on
an exchange. The shares also carry certain redemption rights if the
Company fails to be listed
-13-
- 48 -
<PAGE>
RENAISSANCE INTERNATIONAL GROUP, LTD.
(Formerly known as Nuclear Corporation of New Mexico)
(A Development Stage Company)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
September 30, 1997
Payments in the amount of $35,000 were received on the preferred stock
subscriptions.
The Company issued of 1,010,814 shares for cash. Payments in the
amount of $250 were received on common stock subscriptions.
NOTE 6 RELATED PARTY TRANSACTIONS
The Company acquired 300,000 shares of Nuclear Corporation of New
Mexico (NCNM) for $20,000. These shares became an asset of Renaissance
Center, Inc. (RenCen) and the proceeds of the sale were used by the
management of NCNM to complete the due diligence resulting in the
Agreement and Plan of Merger between the two companies. On July 2,
1997, Renaissance Center, Inc. ceased to exist as a separate entity
and Nuclear Corporation of New Mexico changed its name to Renaissance
International Group, Ltd. (RIGL). The 300,000 shares acquired in this
transaction were distributed to various officers of RIGL as bonuses
for completing the merger.
The Company issued 3,632,916 shares to Company officers in exchange
for the right, title and interest to proprietary technology.
382,250 common shares were issued in exchange for services rendered of
which 339,500 were issued to Company officers for services rendered in
acquiring a performance contract for a high-tech center at Babelsberg,
Germany.
NOTE 7 SUBSEQUENT EVENTS
Subsequent to September 30, 1997, the Company received $638,400, the
balance of the subscriptions receivable due on the Series A Preferred
Stock.
The $10,000 payment required to extend the 90 day option on the O-CAS
system was made on December 2, 1997
Management had previously approved 1,000,000 shares of Series A.1 Preferred
Stock under similar terms to that of the Series A Preferred Stock. As of
December 31, 1997, the Company had received subscriptions totaling
$961,250.
-14-
- 49 -
<PAGE>
RENAISSANCE INTERNATIONAL GROUP, LTD.
(Formerly known as Nuclear Corporation of New Mexico)
(A Development Stage Company)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
September 30, 1997
Effective October 22, 1997 warrants were issued to existing stockholders to
acquire 1,180,800 preferred shares at a price of $2.00 per share and
750,000 common shares at a price of $2.30 per share. The warrants expire on
October 22, 1998.
On October 20, 1997, Berry-Shino Securities of Phoenix, Arizona received
clearance from the NASD to trade the Company's common stock on the
Electronic Bulletin Board Quotation System under the symbol "RNIG". The
Company received a new CUSIP number on October 21, 1997 and the first trade
was executed on October 22, 1997.
-15-
- 50 -
<PAGE>
<PAGE>
SIGNATURES
In accordance with Section 12 of the Securities Exchange Act of 1934, the
registrant caused this registration statement to be signed on its behalf by
the undersigned, thereunto duly authorized.
Renaissance International Group, Inc.
(Registrant)
Date: May 5, 1998
By: /s/ Kevin L. Jones
Kevin L. Jones, President and Director
Kevin L. Jones, President and Director
Date: May 5, 1998
By: /s/ Kevin L. Jones
William D. O'Neal, Esquire, Senior Vice President, General Counsel and
Director
Date: May 5, 1998
By: /s/ William D. O'Neal
Walter Vogel, Director
Date: May 5, 1998
By: /s/ Walter Vogel
Harold Roberts, Director
Date: May 5, 1998
By: /s/ Harold Roberts
Tennessee Webb, Director
Date: May 5, 1998
By: /s/ Tennessee Webb
John A. Williams, Chief Financial Officer
Date: May 5, 1998
By: /s/ John A. Williams
- 51 -
EXHIBIT 3(i)
CERTIFICATE OF RESTATED ARTICLES OF INCORPORATION
OF
RENAISSANCE INTERNATIONAL GROUP, LTD.
We the undersigned Tennessee Webb, President and Peter de Krey,
Secretary of Renaissance International Group, Ltd. do hereby certify:
That the Board of Directors of said corporation at a meeting duly
convened, held on the 3rd day of July,1997, adopted resolutions to
restate the original Articles of Incorporation to read as follows:
1. NAME. The name of the corporation is Renaissance International
Group, Ltd. (the "Corporation").
2. RESIDENT AGENT. The name and address of the initial resident
agent of the corporation is William L. Dempsey, 5405 W. Flamingo Rd., Las
Vegas, Nevada 89103.
3. AUTHORIZED CAPITAL. The Corporation shall have authority to
issue 25,000,000 shares of Common Stock, par value $.001 per share and
each share having one vote, and 15,000,000 shares of preferred stock, par
value $.001 per share.
4. PREFERRED STOCK.
4.1. SERIES. The board of directors is authorized, subject to
limitations prescribed by law and these Articles of Incorporation, to
provide for the issuance of the shares of preferred stock in series, and
by filing a certificate pursuant to the applicable law of the State of
Nevada, to establish from time to time the number of shares to be
included in each such series, and to fix the designation, voting powers,
preferences and rights of the shares of each such series and the
qualifications, limitations or restrictions thereof.
4.2. RIGHTS AND LIMITATIONS. The authority of the board of
directors with respect to each series of preferred stock shall include,
without limitation, determination of the following:
(a) The number of shares constituting that series and the
distinctive designation of that series;
(b) The dividend rate on the shares of that series,
whether dividends shall be cumulative, and, if so, from which date or
dates, and the relative rights of priority, if any, of payment of
dividends on shares of that series;
1
<PAGE>
(c) Whether that series shall have voting rights, in
addition to the voting rights provided by law, and if so, the terms of
such voting rights;
(d) Whether that series shall have conversion privileges,
and if so, the terms and conditions of such conversion, including
provisions for adjustment of the conversion rate in such events as the
board of directors shall determine;
(e) Whether or not the shares of that series shall be
redeemable, and if so, the terms and conditions of such redemption,
including the date or dates upon or after which they shall be redeemable,
and the amount per share payable in case of redemption, which amount may
vary under different conditions and at different redemption dates;
(f) Whether that series shall have a sinking fund for the
redemption or purchase of shares of that series, and if so, the terms and
amount of such sinking fund;
(g) The rights of the shares of that series in the event
of voluntary or involuntary liquidation, dissolution or winding up of the
Corporation, and the relative rights of priority, if any, of payment of
shares of that series; and
(h) Any other relative rights, preferences and
limitations of that series.
4.3. DIVIDENDS. Dividends on outstanding shares of preferred
stock shall be paid or declared and set apart for payment before any
dividends shall be paid or declared and set apart for payment on the
common shares with respect to the same dividend period.
4.4. LIQUIDATION. If upon any voluntary or involuntary
liquidation, dissolution or winding up of the Corporation, the assets
available for distribution to holders of shares of preferred stock of all
series shall be insufficient to pay such holders the full preferential
amount to which they are entitled, then such assets shall be distributed
ratably among the shares of all series of preferred stock in accordance
with the respective preferential amounts (including unpaid cumulative
dividends, if any) payable with respect thereto.
5. DESIGNATION OF SERIES A CONVERTIBLE PREFERRED STOCK. In
accordance with the foregoing Article FOURTH, the Corporation shall have
the authority to issue a class of Preferred Stock which shall have the
following preferences, voting powers, qualifications, special or relative
rights and privileges:
5.1. DESIGNATION AND AMOUNT. The class of Preferred Stock of
the Corporation authorized as part of the Preferred Stock by this
paragraph 5.1 of Article FIFTH shall be designated as Series A
Convertible Preferred Stock (the "Series A Preferred Stock"), and the
number of shares constituting such class shall be 3,000,000.
2
<PAGE>
5.2. DIVIDENDS. No dividends shall be declared and set aside
for any shares of the Series A Preferred Stock.
5.3. LIQUIDATION, DISSOLUTION OR WINDING UP.
5.3.1. In the event of any voluntary or involuntary
liquidation, dissolution or winding up of the Company, the holders of
shares of Series A Preferred Stock then outstanding shall be entitled to
be paid out of the assets of the Company available for distribution to
its stockholders, after and subject to the payment in full of all amounts
required to be distributed to the holders of any other class or series of
stock of the Company ranking on liquidation prior and in preference to
the Series A Preferred Stock (collectively referred to as "Senior
Preferred Stock"), but before any payment shall be made to the holders of
Junior Stock by reason of their ownership thereof, an amount equal to
$1.50 per share of Series A Preferred Stock. If upon any such
liquidation, dissolution or winding up of the Company the remaining
assets of the Company available for distribution to its stockholders
shall be insufficient to pay the holders of shares of Series A Preferred
Stock the full amount to which they shall be entitled, the holders of
shares of Series A Preferred Stock and any class or series of stock (the
"Preferred Stock") ranking on liquidation on a parity with the Series A
Preferred Stock shall share ratably in any distribution of the remaining
assets and funds of the Company in proportion to the respective amounts
which would otherwise be payable in respect of the shares held by them
upon such distribution if all amounts payable on or with respect to such
shares were paid in full.
5.3.2. After the payment of all preferential amounts
required to be paid to the holders of Senior Preferred Stock upon the
dissolution, liquidation, or winding up of the Company, all of the
remaining assets and funds of the Company available for distribution to
its stockholders shall be distributed ratably among the holders of the
Series A Preferred Stock, such other series of Preferred Stock as are
constituted as similarly participating, and the Common Stock, with each
share of Series A Preferred Stock being deemed, for such purpose, to be
equal to the number of shares of Common Stock, including fractions of a
share, into which such share of Series A Preferred Stock is convertible
immediately prior to the close of business on the business day fixed for
such distribution.
5.4. VOTING.
5.4.1. Each holder of outstanding shares of Series A
Preferred Stock shall be entitled to the number of votes equal to the
number of whole shares of Common Stock into which the shares of Series A
Preferred Stock held by such holder are convertible (as adjusted from
time to time pursuant to Section 5.6 hereof), at each meeting of
Stockholders of the Company (and written actions of stockholders in lieu
of meetings) with respect to any and all matters presented to the
stockholders of the Company for their action or consideration. Except as
provided by law, by the provisions of Subsection 5.4.2 below, or by the
provisions establishing any other series of Preferred Stock, holders of
Series A Preferred Stock and of any other outstanding series of Preferred
stock shall vote together with the holders of Common Stock as a single
class.
3
<PAGE>
5.4.2. The Company shall not amend, alter or repeal
preferences, rights, powers or other terms of the Series A Preferred
Stock so as to affect adversely the Series A Preferred Stock, without the
written consent or affirmative vote of the holders of at least 66_% of
the then outstanding shares of Series A Preferred Stock, given in writing
or by vote at a meeting, consenting or voting (as the case may be)
separately as a class. For this purpose, without limiting the generality
of the foregoing, the authorization or issuance of any series of
Preferred stock which is on a parity with or has preference or priority
over the Series A Preferred Stock as to the right to receive either
dividends or amounts distributable upon liquidation, dissolution or
winding up of the Company shall be deemed to affect adversely the Series
A Preferred Stock.
5.5. OPTIONAL CONVERSION. The holders of the Series A
Preferred Stock shall have conversion rights as follows (the "Conversion
Rights"):
5.5.1. RIGHT TO CONVERT. Each share of Series A
Preferred Stock shall be convertible, at the option of the holder
thereof, at any time and from time to time, into such number of fully
paid and nonassessable shares of Common Stock as is determined by
dividing $1.00 by the Conversion Price (as defined below) in effect at
the time of conversion. The Conversion Price at which shares of Common
Stock shall be deliverable upon conversion of Series A Preferred Stock
without the payment of additional consideration by the holder thereof
(the "Conversion Price") shall initially be $1.00. Such initial
Conversion Price, and the rate at which shares of Series A Preferred
Stock may be converted into shares of Common Stock, shall be subject to
adjustment as provided below. In the event of a liquidation of the
Company, the Conversion Rights shall terminate at the close of business
on the first full day preceding the date fixed for the payment of any
amounts distributable on liquidation to the holders of Series A Preferred
Stock.
5.5.2. FRACTIONAL SHARES. No fractional shares of
Common Stock shall be issued upon conversion of the Series A Preferred
Stock. In lieu of fractional shares, the Company shall pay cash equal to
such fraction multiplied by the then effective Conversion Price.
5.5.3. MECHANICS OF CONVERSION.
5.5.3.1. In order to convert shares of Series A
Preferred Stock into shares of Common Stock, the holder shall surrender
the certificate or certificates for such shares of Series A Preferred
Stock at the office of the transfer agent (or at the principal office of
the Company if the Company serves as its own transfer agent), together
with written notice that such holder elects to convert all or any number
of the shares represented by such certificate or certificates. Such
notice shall state such holder's name or the names of the nominees in
which such holder wishes the certificate or certificates for shares of
Common Stock to be issued. If required by the Company, certificates
surrendered for conversion shall be endorsed or accompanied by a written
instrument or instruments of transfer, in form satisfactory to the
Company, duly executed by the registered holder or his or its attorney
duly authorized in
4
<PAGE>
writing. The date of receipt of such certificates and notice by the
transfer agent or the Company shall be the conversion date ("Conversion
Date"). The Company shall, as soon as practicable after the Conversion
Date, issue and deliver at such office to such holder, or to his
nominees, a certificate or certificates for the number of shares of
Common Stock to which such holder shall be entitled, together with cash
in lieu of any fraction of a share.
5.5.3.2. The Company shall at all times during which
the Series A Preferred Stock shall be outstanding, reserve and keep
available out of its authorized but unissued stock, for the purpose of
effecting the conversion of the Series A Preferred Stock, such number of
its duly authorized shares of Common Stock as shall from time to time be
sufficient to effect the conversion of all outstanding Series A Preferred
Stock. Before taking any action which could cause an adjustment reducing
the Conversion Price below the then par value of the shares of Common
Stock issuable upon conversion of the Series A Preferred Stock, the
Company will take any corporate action which may, in the opinion of its
counsel, be necessary in order that the Company may validly and legally
issue fully paid and nonassessable shares of Common Stock at such
adjusted Conversion Price.
5.5.3.3. All shares of Series A Preferred Stock,
which shall have been surrendered for conversion as herein provided shall
no longer be deemed to be outstanding and all rights with respect to such
shares, including the rights, if any, to receive notices and to vote,
shall immediately cease and terminate on the Conversion Date, except only
the right of the holders thereof to receive shares of Common Stock in
exchange therefor. Any shares of Series A Preferred Stock so converted
shall be retired and canceled and shall not be reissued, and the Company
may from time to time take such appropriate action as may be necessary to
reduce the number of shares of authorized Series A Preferred Stock
accordingly.
5.5.3.4. If the conversion is in connection with an
underwritten offer of securities registered pursuant to the Securities
Act of 1933, as amended, the conversion may at the option of any holder
tendering Series A Preferred Stock for conversion be conditioned upon the
closing with the underwriter of the sale of securities pursuant to such
offering, in which event the person(s) entitled to receive the Common
Stock issuable upon such conversion of the Series A Preferred Stock shall
not be deemed to have converted such Series A Preferred Stock until
immediately prior to the closing of the sale of securities.
5.5.4. ADJUSTMENTS TO CONVERSION PRICE FOR DILUTING
ISSUES.
5.5.4.1. SPECIAL DEFINITIONS. For purposes of this
Subsection 5.5.4, the following definitions shall apply:
5.5.4.1.1. "Option" shall mean rights,
options or warrants to subscribe for, purchase or otherwise acquire
Common Stock or Convertible Securities, excluding rights or options
granted to employees, directors or consultants of the Company pursuant to
an option plan adopted by the Board of Directors to acquire up to that
5
<PAGE>
number of shares of Common Stock as is equal to 15% of the Common Stock
outstanding (provided that, for purposes of this Subsection 5.5.4.1.1,
all shares of Common Stock issuable upon (1) exercise of options granted
or available for grant under plans approved by the Board of Directors,
(2) conversion of shares of Preferred Stock, or (3) conversion of
Preferred Stock issuable upon conversion or exchange of any Convertible
Security, shall be deemed to be outstanding), minus the total number of
Key Employee Shares (as defined below).
5.5.4.1.2. "Original Issue Date" shall mean
the date on which the first share of Series A Preferred Stock is first
issued.
5.5.4.1.3. "Convertible Securities" shall
mean any evidences of indebtedness, shares or other securities directly
or indirectly convertible into or exchangeable for Common Stock.
5.5.4.1.4. "Additional Shares of Common
Stock" shall mean all shares of Common Stock issued (or, pursuant to
Subsection 5.5.4.3 below, deemed to be issued) by the Company after the
Original Issue Date, other than Key Employee Shares (as defined below)
and other than shares of Common Stock issued or issuable:
5.5.4.1.4.1. as a dividend or
distribution on Series A Preferred Stock;
5.5.4.1.4.2. by reason of a dividend,
stock split, split-up or other distribution on shares of Common Stock
excluded from the definition of Additional Shares of Common Stock by the
foregoing clause 5.5.4.1.4.1;
5.5.4.1.4.3. upon the exercise of options
excluded from the definition of "Option" in Subsection 5.5.4.1.1; or
5.5.4.1.4.4. upon conversion of shares of
Series A Preferred Stock.
5.5.4.1.5. "Key Employee Shares" shall mean
shares of Common Stock issued to directors or key employees of or
consultants to the Company pursuant to a restricted stock plan or
agreement approved by the Board of Directors, up to that number of shares
of Common Stock as is equal to fifteen (15%) percent of the Common Stock
outstanding (provided that, for purposes of this Subsection 5.5.4.1.5,
all shares of Common Stock issuable upon (1) exercise of options granted
or available for grant under plans approved by the Board of Directors,
(2) conversion of shares of Preferred Stock, or (3) upon conversion of
Preferred Stock issuable upon conversion or exchange of any Convertible
Security, shall be deemed to be outstanding), minus the total number of
shares subject to or issued pursuant to options excluded from the
definition of "Option" in paragraph (A) above (subject to appropriate
adjustment for any stock dividend, stock split, combination or similar
recapitalization affecting such shares).
6
<PAGE>
5.5.4.1.6. "Rights to Acquire Common Stock"
(or "Rights") shall mean all rights issued by the Company to acquire
common stock whatever by exercise of a warrant, option or similar call or
conversion of any existing instruments, in either case for consideration
fixed, in amount or by formula, as of the date of issuance.
5.5.4.2. NO ADJUSTMENT OF CONVERSION PRICE. No
adjustment in the number of shares of Common Stock into which the Series
A Preferred Stock is convertible shall be made, by adjustment in the
applicable Conversion Price thereof: (a) unless the consideration per
share (determined pursuant to Subsection 5.5.4.5) below for an Additional
Share of Common Stock issued or deemed to be issued by the Company is
less than the applicable Conversion Price in effect on the date of, and
immediately prior to, the issue of such additional shares, or (b) if
prior to such issuance, the Company receives written notice from the
holders of at least 66_% of the outstanding shares of Series A Preferred
Stock agreeing that no such adjustment shall be made as the result of the
issuance of Additional Shares of Common Stock.
5.5.4.3. ISSUE OF SECURITIES DEEMED ISSUE OF
ADDITIONAL SHARES OF COMMON STOCK. If the Company at any time or from
time to time after the Original Issue Date shall issue any Options or
Convertible Securities or other Rights to Acquire Common Stock, then the
maximum number of shares of Common Stock (as set forth in the instrument
relating thereto without regard to any provision contained therein for a
subsequent adjustment of such number) issuable upon the exercise of such
Options, Rights or, in the case of Convertible Securities, the conversion
or exchange of such Convertible Securities, shall be deemed to be
Additional Shares of Common Stock issued as of the time of such issue,
provided that Additional Shares of Common Stock shall not be deemed to
have been issued unless the consideration per share (determined pursuant
to Subsection 5.5.4.5 hereof) of such Additional Shares of Common Stock
would be less than the applicable Conversion Price in effect on the date
of and immediately prior to such issue, or such record date, as the case
may be, and provided further that in any such case in which Additional
Shares of Common Stock are deemed to be issued:
5.5.4.3.1. No further adjustment in the
Conversion Price shall be made upon the subsequent issue of shares of
Common Stock upon the exercise of such Rights or conversion or exchange
of such Convertible Securities;
5.5.4.3.2. Upon the expiration or
termination of any unexercised Option or Right, the Conversion Price
shall not be readjusted, but the Additional Shares of Common Stock deemed
issued as the result of the original issue of such Option or Right shall
not be deemed issued for the purposes of any subsequent adjustment of the
Conversion Price; and
7
<PAGE>
5.5.4.3.3. In the event of any change in the
number of shares of Common Stock issuable upon the exercise, conversion
or exchange of any Option, Right or Convertible Security, including, but
not limited to, a change resulting from the anti-dilution provisions
thereof, the Conversion Price then in effect shall forthwith be
readjusted to such Conversion Price as would have obtained had the
adjustment that was made upon the issuance of such Option, Right or
Convertible Security not exercised or converted prior to such change been
made upon the basis of such change, but no further adjustment shall be
made for the actual issuance of Common Stock upon the exercise or
conversion of any such Option, Right or Convertible Security.
5.5.4.4. ADJUSTMENT OF CONVERSION PRICE UPON
ISSUANCE OF ADDITIONAL SHARES OF COMMON STOCK. If the Company shall at
any time after the Original Issue Date issue Additional Shares of Common
Stock (other than in the acquisition of the assets or capital stock of
another corporation but including Additional Shares of Common Stock
deemed to be issued pursuant to Subsection 5.5.4.3, but excluding shares
issued as a dividend or distribution as provided in Subsection 5.5.6 or
upon a stock split or combination as provided in Subsection 5.5.5),
without consideration or for a consideration per share less than the
applicable Conversion Price in effect on the date of and immediately
prior to such issue, then and in such event, such Conversion Price shall
be reduced, concurrently with such issue to a price (calculated to the
nearest cent) determined by multiplying such Conversion Price by a
fraction, (a) the numerator of which shall be (1) the number of shares of
Common Stock outstanding immediately prior to such issue plus (2) the
number of shares of Common Stock which the aggregate consideration
received by the Company for the total number of Additional Shares of
Common Stock so issued would purchase at such Conversion Price; and (b)
the denominator of which shall be (1) the number of shares of Common
Stock outstanding immediately prior to such issue plus (2) the number of
such Additional Shares of Common Stock so issued. Notwithstanding the
foregoing, the applicable Conversion Price shall not be reduced if the
amount of such reduction would be an amount less than $.05, but any such
amount shall be carried forward and reduction with respect thereto made
at the time of and together with any subsequent reduction which, together
with such amount and any other amount or amounts so carried forward,
shall aggregate $.05 or more.
5.5.4.5. DETERMINATION OF CONSIDERATION. For
purposes of this Subsection 5.5.4, the consideration received by the
Company for the issue of any Additional Shares of Common Stock shall be
computed as follows:
5.5.4.5.1. Cash and Property: Such
consideration shall:
5.5.4.5.1.1. insofar as it consists of
cash, be computed at the aggregate of cash received by the Company,
excluding amounts paid or payable for accrued interest or accrued
dividends;
8
<PAGE>
5.5.4.5.1.2. insofar as it consists of
property other than cash, be computed at the fair market value thereof at
the time of such issue, as determined in good faith by the Board of
Directors; and
5.5.4.5.1.3. in the event Additional
Shares of Common Stock are issued together with other shares or
securities or other assets of the Company for consideration which covers
both, be the proportion of such consideration so received, computed as
provided in clauses (1) and (2) above, as determined in good faith by the
Board of Directors.
5.5.4.5.2. OPTIONS, RIGHTS AND CONVERTIBLE
SECURITIES. The consideration per share received by the Company for
Additional Shares of Common Stock deemed to have been issued pursuant to
Subsection 5.5.4.3, relating to Options, Rights and Convertible
Securities, shall be determined by dividing
* the total amount, if any, received or receivable by the Company
as consideration for the issue of such Options, Rights or
Convertible Securities, plus the minimum aggregate amount of
additional consideration (as set forth in the instruments
relating thereto, without regard to any provision contained
therein for a subsequent adjustment of such consideration)
payable to the Company upon the exercise of such Options,
Rights or the conversion or exchange of such Convertible
Securities, by
* the maximum number of shares of Common Stock (as set forth in
the instruments relating thereto, without regard to any
provision contained therein for a subsequent adjustment of such
number) issuable upon the exercise of such Options or the
conversion or exchange of such Convertible Securities.
5.5.5. ADJUSTMENT FOR STOCK SPLITS AND COMBINATIONS.
If the Company shall at any time or from time to time after the Original
Issue Date effect a subdivision of the outstanding Common Stock, the
Conversion Price then in effect immediately before that subdivision shall
be proportionately decreased. If the Company shall at any time or from
time to time after the Original Issue Date combine the outstanding shares
of Common Stock, the Conversion Price then in effect immediately before
the combination shall be proportionately increased. Any adjustment under
this paragraph shall become effective at the close of business on the
date the subdivision or combination becomes effective.
5.5.6. ADJUSTMENT FOR CERTAIN DIVIDENDS AND
DISTRIBUTIONS. In the event the Company at any time, or from time to
time after the Original Issue Date shall make or issue, a dividend or
other distribution payable in Additional Shares of Common Stock, then and
in each such event the Conversion Price shall be decreased as of the time
of such issuance, by multiplying the Conversion Price by a fraction:
9
<PAGE>
* the numerator of which shall be the total number of shares of
Common Stock issued and outstanding immediately prior to the
time of such issuance, and
* the denominator of which shall be the total number of shares of
Common Stock issued and outstanding immediately prior to the
time of such issuance plus the number of shares of Common Stock
issuable in payment of such dividend or distribution.
5.5.7. ADJUSTMENTS FOR OTHER DIVIDENDS AND
DISTRIBUTIONS. In the event the Company at any time or from time to time
after the Original Issue Date shall make or issue a dividend or other
distribution payable in securities of the Company other than shares of
Common Stock, then and in each such event provision shall be made so that
the holders of shares of the Series A Preferred Stock shall receive upon
conversion thereof in addition to the number of shares of Common Stock
receivable thereupon, the amount of securities of the Company that they
would have received had their Series A Preferred Stock been converted
into Common Stock on the date of such event and had thereafter, during
the period from the date of such event to and including the conversion
date, retained such securities receivable by them as aforesaid during
such period given application to all adjustments called for during such
period, under this paragraph with respect to the rights of the holders of
the Series A Preferred Stock.
5.5.8. ADJUSTMENT FOR RECLASSIFICATION, EXCHANGE, OR
SUBSTITUTION. If the Common Stock issuable upon the conversion of the
Series A Preferred Stock shall be changed into the same or a different
number of shares of any class or classes of stock, whether by capital
reorganization, reclassification, or otherwise (other than a subdivision
or combination of shares or stock dividend provided for above, or a
reorganization, merger, consolidation, or sale of assets for below), then
and in each such event the holder of each share of Series A Preferred
Stock shall have the right thereafter to convert such share into the kind
and amount of shares of stock and other securities and property
receivable upon such reorganization, reclassification, or other change,
by holders of the number of shares of Common Stock into which such shares
of Series A Preferred Stock might have been converted immediately prior
to such reorganization, reclassification, or change, all subject to
further adjustment as provided herein.
5.5.9. ADJUSTMENT FOR MERGER OR REORGANIZATION, ETC.
In case of any consolidation or merger of the Company with or into
another corporation or the sale of all or substantially all of the assets
of the Company to another corporation,
5.5.9.1. if the surviving entity shall consent in
writing to the following provisions, then each share of Series A
Preferred Stock shall thereafter be convertible into the kind and amount
of shares of stock or other securities or property to which a holder of
the number of shares of Common Stock of the Company deliverable upon
conversion of such Series A Preferred Stock would have been entitled upon
such consolidation, merger or sale; and, in such case, appropriate
adjustment (as determined in good faith by the Board of Directors) shall
be made in the application of the provisions in this Section 5.5 set
forth with respect to the rights and interest thereafter of the holders
of the Series A Preferred Stock, to the end that the
10
<PAGE>
provisions set forth in this Section 5.5 (including provisions with
respect to changes in and other adjustments of the Conversion Price)
shall thereafter be applicable, as nearly as reasonably may be, in
relation to any shares of stock or other property thereafter deliverable
upon the conversion of the Series A Preferred Stock; or
5.5.9.2. if the surviving entity shall not so
consent, then each holder of Series A Preferred stock may, after receipt
of notice specified in Subsection 5.5.9.1, elect to convert such Stock
into Common Shares as provided in this Section 5.5 or to accept the
distributions to which such holder shall be entitled under Section 5.3.
5.5.10. NO IMPAIRMENT. The Company will not, by
amendment of its Articles of Incorporation or through any reorganization,
transfer of assets, consolidation, merger, dissolution, issue or sale of
securities or any other voluntary action, avoid or seek to avoid the
observance or performance of any of the terms to be observed or performed
hereunder by the Company, but will at all times in good faith assist in
the carrying out of all the provisions of this Section 5.5 and in the
taking of all such action as may be necessary or appropriate in order to
protect the Conversion Rights of the holders of the Series A Preferred
Stock against impairment.
5.5.11. CERTIFICATE AS TO ADJUSTMENTS. Upon the
occurrence of each adjustment or readjustment of the Conversion Price
pursuant to this Section 5.5, the Company at its expense shall promptly
compute such adjustment or readjustment in accordance with the terms
hereof and furnish to each holder, if any, of Series A Preferred Stock a
certificate setting forth such adjustment or readjustment and showing in
detail the facts upon which such adjustment or readjustment is based and
shall file a copy of such certificate with its corporate records. The
Company shall, upon the written request at any time of any holder of
Series A Preferred Stock, furnish or cause to be furnished to such holder
a similar certificate setting forth (1) such adjustments and
readjustment, (2) the Conversion Price then in effect, and (3) the number
of shares of Common Stock and the amount, if any, of other property which
then would be received upon the conversion of Series A Preferred Stock.
Despite such adjustment or readjustment, the form of each or all Series A
Preferred Stock Certificates, if the same shall reflect the initial or
any subsequent conversion price, need not be changed in order for the
adjustments or readjustments to be valued in accordance with the
provisions of this Certificate of Designation, which shall control.
5.5.12. NOTICE OF RECORD DATE. In the event:
5.5.12.1. that the Company declares a dividend (or
any other distribution) on its Common Stock payable in Common Stock or
other securities of the Company;
5.5.12.2. that the Company subdivides or combines its
outstanding shares of Common Stock;
11
<PAGE>
5.5.12.3. of any reclassification of the Common Stock
of the Company (other than a subdivision or combination of its
outstanding shares of Common Stock or a stock dividend or stock
distribution thereon), or of any consolidation or merger of the Company
into or with another corporation, or of the sale of all or substantially
all of the assets of the Company; or
5.5.12.4. of the involuntary or voluntary
dissolution, liquidation or winding up of the Company
then the Company shall cause to be filed at its principal office or at
the office of the transfer agent of the Series A Preferred Stock, and
shall cause to be mailed to the holders of the Series A Preferred Stock
at their last addresses as shown on the records of the Company or such
transfer agent, at least ten days prior to the record date specified in
(A) below or twenty days before the date specified in (B) below, a notice
stating
5.5.12.5. the record date of such dividend,
distribution, subdivision or combination, or, if a record is not to be
taken, the date as of which the holders of Common Stock of record to be
entitled to such dividend, distribution, subdivision or combination are
to be determined, or
5.5.12.6. the date on which such reclassification,
consolidation, merger, sale, dissolution, liquidation or winding up is
expected to become effective, and the date as of which it is expected
that holders of Common Stock of record shall be entitled to exchange
their shares of Common Stock for securities or other property deliverable
upon such reclassification, consolidation, merger, sale, dissolution or
winding up.
5.6. MANDATORY CONVERSION.
5.6.1. The Company shall convert all shares of Series A
Preferred Stock then outstanding into shares of Common Stock, at the then
effective conversion rate pursuant to Section 5.5, on (1) the closing of
the sale of shares of Common Stock in a fully underwritten public
offering pursuant to an effective registration statement under the
Securities Act of 1933, as amended, other than a registration relating
solely to a transaction under Rule 145 under such Act (or any successor
thereto) or to an employee benefit plan of the Company, underwritten by a
underwriter of national reputation, resulting in at least $5,000,000 of
gross proceeds to the Company, or (2), the conversion into Common Stock
of a majority of the outstanding shares of Series A Preferred Stock.
5.6.2. All holders of record of shares of Series A
Preferred Stock then outstanding will be given at least 10 days' prior
written notice of the date fixed and the place designated for mandatory
or special conversion of all such shares of Series A Preferred Stock
pursuant to this Section 5.6. Such notice will be sent by first-class or
registered mail, postage prepaid, to each record holder of Series A
Preferred Stock at such holder's address last shown on
12
<PAGE>
the records of the transfer agent for the series A Preferred Stock (or
the records of the Company, if it serves as its own transfer agent).
5.7. REDEMPTION OF THE SERIES A PREFERRED STOCK.
5.7.1. If, on August 31, 2006, any shares of Series A
Preferred Stock shall be then outstanding, the Company shall have the
right to redeem (unless otherwise prevented by law) all (but not less
than all) such outstanding shares at an amount per share equal to $1.00
(the "Mandatory Redemption Price").
5.7.2. Sixty days' prior notice by the Company of the
exercise of the redemption option pursuant to Section 5.7.1 shall be sent
by first-class certified mail, postage prepaid and return receipt
requested, by the Company to the holders of the shares of Series A
Preferred Stock to be redeemed at their respective addresses as the same
shall appear on the books of the Company.
5.7.3. On or prior to each Redemption Date, the Company
shall deposit the Redemption Price of all shares of Series A Preferred
Stock designated for redemption in the redemption notice and not yet
redeemed with a bank or trust corporation having aggregate capital and
surplus in excess of $100,000,000 as a trust fund for the benefit of the
respective holders of the shares designated for redemption and not yet
redeemed, with irrevocable instructions and authority to the bank or
trust corporation to pay the Redemption Price for such shares to their
respective holders on or after the Redemption Date upon receipt of
notification from the Company that such holder has surrendered his share
certificate to the Company pursuant to Section 5.7.2 above. As of the
Redemption Date, the deposit shall constitute full payment of the shares
to their holders, and from and after the Redemption Date the shares so
called for redemption shall be redeemed and shall be deemed to be no
longer outstanding, and the holders thereof shall cease to be
stockholders with respect to such shares and shall have no rights with
respect thereto except the rights to receive from the bank or trust
corporation payment of the Redemption Price of the shares, without
interest, upon surrender of their certificates therefor. Such
instructions shall also provide that any moneys deposited by the Company
pursuant to this Section 5.7.3 for the redemption of shares thereafter
converted into shares of the Company's Common Stock pursuant to Section
5.7.5 hereof prior to the Redemption Date shall be returned to the
Company forthwith upon such conversion. The balance of any moneys
deposited by the Company pursuant to this Section 5.7.3 remaining
unclaimed at the expiration of two (2) years following the Redemption
Date shall thereafter be returned to the Company upon its request
expressed in a resolution of its Board of Directors.
5.7.4. If upon the Mandatory Redemption Date the assets
of the Company available for redemption are insufficient to pay the
holders of outstanding shares of Series A Preferred Stock the full
amounts to which they are entitled, such holders of shares of Series A
Preferred Stock shall share ratably according to the respective amounts
which would be payable in respect of such shares to be redeemed by the
holders thereof, if all amounts payable
13
<PAGE>
on or with respect to such shares were paid in full.
5.7.5. OPTIONAL REDEMPTION.
5.7.5.1. Upon the occurrence of any Optional
Redemption Event the Company will, by notice given to each holder of
Series A Preferred Stock, offer to redeem all (but not fewer than all)
shares of Series A Preferred Stock then owned by such holder at the
Mandatory Redemption Price, except as otherwise provided in Subsection
5.7.5.3.2 below.
5.7.5.2. Upon receipt of a notice given pursuant to
Section 5.7.5.1, each holder of Series A Preferred Stock shall have the
right to accept such offer by tendering such holder's shares to the
Company for redemption, at an address to be set forth in such notice, at
any time prior to 5:00 p.m. Phoenix, Arizona time on the 15th day
following the making of the offer to redeem by notice given as described
herein.
5.7.5.3. The following shall be Optional Redemption
Events:
5.7.5.3.1. the failure, for any reason
beyond the reasonable control of the Company, of the Company to have
received a total consideration of at least $1,000,000 in respect of the
sale of shares of Series A Preferred Stock before June 30, 1997;
provided, however, that if, through no fault of the Company, a purchaser
who has subscribed for shares of Series A Preferred Stock fails to
refuses to purchase the number of Series A Preferred Stock it has
subscribed for, the Company shall have 90 days from the date of notice to
the Company of such failure or refusal to find a qualified replacement
purchaser;
5.7.5.3.2. the failure, for any reason
beyond the reasonable control of the Company, to have closed a sale of
shares of Common Stock in a fully underwritten public offering pursuant
to an effective registration statement under the Securities Act of 1933,
as amended, other than a registration relating solely to a transaction
under Rule 145 under such Act (or any successor thereto) or to an
employee benefit plan of the Company, underwritten by a underwriter of
national reputation, resulting in at least $5,000,000 of gross proceeds
to the Company (an "IPO Closing"); PROVIDED, HOWEVER, THAT the Company
shall pay a multiple of the Mandatory Redemption Price as follows:
5.7.5.3.2.1. 125% of the Mandatory
Redemption Price if an IPO Closing shall not have occurred prior to
February 28, 1997;
5.7.5.3.2.2. 135% of the Mandatory
Redemption Price if an IPO Closing shall not have occurred prior to
August 31, 1997; and
5.7.5.3.2.3. 150% of the Mandatory
Redemption Price if an IPO Closing shall not have occurred prior to
February 28, 1998.
14
<PAGE>
5.7.5.3.3. the occurrence of a Change of
Control, which shall be deemed to have occurred if:
5.7.5.3.3.1. any person or group of
related or affiliated persons shall have become the beneficial owner or
owners of 40% or more of the outstanding voting stock of the Company;
provided, that beneficial ownership of Series A Preferred Stock shall not
be given effect toward counting a person's or group of related or
affiliated persons' beneficial ownership;
5.7.5.3.3.2. there shall have occurred a
merger or consolidation in which the Company is not the survivor or in
which holders of Common Stock of the Company shall have become entitled
to receive cash, securities of the Company other than voting Common Stock
or securities of any other person;
5.7.5.3.3.3. at any time a majority of
the members of the Board of Directors of the Company shall be persons who
were elected at one or more meetings held, or by one or more consents
given, by the stockholders of the Company during the preceding twelve
months and who were not members of the Board of Directors twelve months
prior to that time; or
5.7.5.3.3.4. if the Company shall take
any action referred to in Section 5.3.1 without having obtained the
required consent of the holders of Series A Preferred Stock.
5.7.6. CANCELLATION OF REDEEMED STOCK. Any shares of
Series A Preferred Stock redeemed pursuant to this Section or otherwise
acquired by the Company in any manner whatsoever shall be canceled and
shall not under any circumstances be reissued; the Company may from time
to time take such appropriate corporate action as may be necessary to
reduce accordingly the number of authorized shares of the Company's
capital stock.
5.7.7. The Company will not, and will not permit any
subsidiary of the Company to, purchase or acquire any shares of Series A
Preferred Stock otherwise than pursuant to (1) the terms of this Section,
or (2) an offer made on the same terms to all holders of Series A
Preferred Stock at the time outstanding.
5.7.8. Anything contained in this Section 5.7 to the
contrary notwithstanding, the holders of shares of Series A Preferred
Stock to be redeemed in accordance with this Section shall have the
right, exercisable at any time up to the close of business on the
applicable redemption date (unless the Company is legally prohibited from
redeeming such shares on such date, in which event such right shall be
exercisable until the removal of such legal disability), to convert all
or any part of such shares to be redeemed as herein provided into shares
of Common Stock pursuant to Section 5.6 hereof.
6. STOCK RIGHTS AND OPTIONS. The Corporation shall have
authority, as provided
15
<PAGE>
under the laws of the State of Nevada, to create and issue rights and
options entitling the holders thereof to purchase shares of stock of the
Corporation. The issuance of such rights and options, whether or not to
directors, officers or employees of the Corporation or of any affiliate
thereof and not to the stockholders generally, need not be approved or
ratified by the stockholders of the Corporation or be authorized by or be
consistent with a plan approved or ratified by the stockholders of the
Corporation.
7. INITIAL DIRECTORS AND OFFICERS. Members of the governing board
shall be styled Directors. The initial board of directors shall consist
of three directors. The names and addresses of the persons who are to
serve as directors until the next annual meeting of stockholders or until
their successors are elected and qualify are:
Tennessee Webb
10105 East Via Linda, Suite 103195
Scottsdale, Arizona 85258
Kevin L. Jones
7501 North 16th Street, Suite 200
Phoenix, Arizona 85020
Harold Roberts
7501 North 16th Street, Suite 200
Phoenix, Arizona 85020
The number of persons to serve on the board of directors thereafter
shall be fixed by the Bylaws. The persons who are to serve as officers
at the pleasure of the board of directors are:
Tennessee Webb President/C.E.O.
Kevin L. Jones Vice-President/Treasurer
Peter de Krey Vice-President/Secretary
James Jones Vice-President/Assistant Secretary
8. DISTRIBUTIONS TO STOCKHOLDERS. The board of directors of the
corporation may, from time to time, distribute to its stockholders, a
portion of its assets, in cash or property, whether or not the
distribution, after giving it effect would cause the Corporation's total
assets to be less than the sum of the total liabilities plus the amount
that would be needed, if dissolution were to occur at the time of
distribution, to satisfy the preferential rights upon dissolution of
stockholders whose preferential rights are superior to those receiving
the distribution. The Board of Directors may base a determination that a
distribution is permitted hereunder on (i) financial
16
<PAGE>
statements prepared on the basis of accounting practices that are
reasonable under the circumstances; (ii) a fair valuation, including, but
not limited to, unrealized appreciation and depreciation; or (iii) any
other method that is reasonable in the circumstances.
9. DIRECTOR AND OFFICER LIABILITY. A director and officer of the
Corporation shall not be personally liable to the Corporation or its
stockholders for damages for breach of fiduciary duty as a director or
officer, except for liability (i) for acts or omissions which involve
intentional misconduct, fraud or a knowing violation of law, or (ii) for
authorizing the unlawful distribution in violation of Section 78.300 of
the Nevada General Corporation Law. If the Nevada General Corporation
Law is amended after approval by the stockholders of this Article to
authorize corporate action further eliminating or limiting the personal
liability of directors or officers, then the liability of a director or
officer of the Corporation shall be eliminated or limited to the fullest
extent permitted by the Nevada General Corporation Law, as so amended.
Any repeal or modification of the foregoing paragraph by the
stockholders of the Corporation shall not adversely affect any right or
protection of a director or officer of the Corporation existing at the
time of such repeal or modification. No amendment to the Nevada Revised
Statutes that further limits the acts, omissions or transactions for
which elimination or limitation of liability is permitted shall affect
the liability of a director or officer for any act, omission or
transaction which occurs prior to the effective date of such amendment.
The number of shares of the corporation outstanding and entitled to
vote on an amendment to the Articles of Incorporation is 1,294,300, that
said changes and amendments have been consented to and approved by a
majority written consent of the stockholders holding at least a majority
of each class of stock outstanding and entitled to vote thereon.
DATE: July 3, 1997 /s/ TENNESSEE WEBB
------------------------------------
Jon "Tennessee" Webb, President
/s/ PETER DE KREY
------------------------------------
Peter de Krey, Corporate Secretary
17
<PAGE>
STATE OF ARIZONA )
)ss.
County of MARICOPA )
On October 16, 1997, personally appeared before me, a Notary
Public, Jon "Tennessee" Webb, President of Renaissance International
Group, Ltd., who acknowledged that he executed the above instrument
------------------------------------
Notary Public
My Commission Expires:
- ----------------------------
STATE OF ARIZONA )
)ss.
County of MARICOPA )
On October 16, 1997, personally appeared before me, a Notary
Public, Peter de Krey, Secretary of Renaissance International Group,
Ltd., who acknowledged that he executed the above instrument
------------------------------------
Notary Public
My Commission Expires:
- ----------------------------
18
EXHIBIT 3(ii)
BYLAWS OF
RENAISSANCE INTERNATIONAL GROUP, LTD.
a Nevada corporation
(As Adopted effective July 3, 1997)
ARTICLE I
OFFICES
1.1. REGISTERED OFFICE. The registered office of the Corporation in
the State of Nevada, shall be in a county and city of the State of Nevada.
1.2. OTHER OFFICES. The Corporation also may have offices at such
other places both within and without the State of Nevada as the Board of
Directors may from time to time determine or the business of the
Corporation may require.
ARTICLE II
STOCKHOLDERS
2.1 STOCKHOLDER MEETINGS.
(a) TIME AND PLACE OF MEETINGS. Meetings of the stockholders
shall be held at such times and places, either within or without the State
of Nevada, as may from time to time be fixed by the Board of Directors and
stated in the notices or waivers of notice of such meetings.
(b) ANNUAL MEETING. Annual meetings of stockholders shall be
held within one hundred twenty (120) days of the fiscal year end of the
corporation or at such other date and time as may be set and stated in the
notice of the meeting. At the annual meeting, stockholders shall elect a
board of directors and transact such other business as properly may be
brought before the annual meeting.
(c) SPECIAL MEETINGS. Special meetings of the stockholders of
the Corporation, for any purpose or purposes, may be called at any time
only by the Chairman of the Board, or the Board of Directors pursuant to a
resolution approved by a majority of the whole Board of Directors, or at
the request in writing of shareholders owning at least 10% of capital stock
issued and outstanding and entitled to vote, or such other percentage as
required under applicable federal, state or local statutes, regulations or
ordinances. Business transacted at any special meeting of the stockholders
shall be limited to the purposes stated in the notice of such meeting.
(d) NOTICE OF MEETINGS. Except as otherwise provided by law,
the Articles of Incorporation or these Bylaws, written notice of each
meeting of the stockholders shall be given not less than ten days nor more
than sixty days before the date of such meeting to each stockholder
entitled to vote thereat, directed to such stockholder's address as it
appears upon the stock ledger of the Corporation, such notice to specify
the place, date, hour and purpose or purposes of such meeting. If mailed,
such notice shall be deemed to be given when deposited in the United States
mail, postage
<PAGE>
prepaid, addressed to the stockholder at his address as it appears on the
stock ledger of the Corporation. When a meeting of the stockholders is
adjourned to another time and/or place, notice need not be given of such
adjourned meeting if the time and place are announced at the meeting of the
stockholders at which the adjournment is taken, unless the adjournment is
for more than thirty days or unless after the adjournment a new record date
is fixed for such adjourned meeting, in which event a notice of such
adjourned meeting shall be given to each stockholder of record entitled to
vote thereat. Notice of the time, place and purpose of any meeting of the
stockholders may be waived in writing either before or after such meeting
and will be waived by any stockholder by such stockholder's attendance
thereat in person or by proxy. Any stockholder so waiving notice of such
a meeting shall be bound by the proceedings of any such meeting in all
respects as if due notice thereof had been given.
(e) QUORUM. Except as otherwise required by law, the Articles
of Incorporation or these Bylaws, the holders of not less than a majority
of the shares entitled to vote at any meeting of the stockholders, present
in person or by proxy, shall constitute a quorum and the affirmative vote
of the majority of such quorum shall be deemed the act of the stockholders.
If a quorum shall fail to attend any meeting of the stockholders, the
presiding officer of such meeting may adjourn such meeting from time to
time to another place, date or time, without notice other than announcement
at such meeting, until a quorum is present or represented. At such
adjourned meeting at which a quorum is present or represented, any business
may be transacted that might have been transacted at the meeting of the
stockholders as originally noticed. The foregoing notwithstanding, if a
notice of any adjourned special meeting of the stockholders is sent to all
stockholders entitled to vote thereat which states that such adjourned
special meeting will be held with those present in person or by proxy
constituting a quorum, then, except as otherwise required by law, those
present at such adjourned special meeting of the stockholders shall
constitute a quorum and all matters shall be determined by a majority of
the votes cast at such special meeting.
2.2. DETERMINATION OF STOCKHOLDERS ENTITLED TO NOTICE AND TO VOTE.
To determine the stockholders entitled to notice of any meeting of the
stockholders or to vote thereat, the Board of Directors may fix in advance
a record date as provided in Article II, Section 2.8 of these Bylaws, or if
no record date is fixed by the Board of Directors, a record date shall be
determined as provided by law.
2.3. VOTING.
(a) Except as otherwise required by law, the Articles of
Incorporation or these Bylaws, each stockholder present in person or by
proxy at a meeting of the stockholders shall be entitled to one vote for
each full share of stock registered in the name of such shareholder at the
time fixed by the Board of Directors or by law at the record date of the
determination of stockholders entitled to vote at such meeting.
(b) Every stockholder entitled to vote at a meeting of the
stockholders may do so either (i) in person or (ii) by one or more agents
authorized by a written proxy executed by the person or such stockholder's
duly authorized agent, whether by manual signature, typewriting,
telegraphic transmission or otherwise as permitted by law. No proxy shall
be voted on after three years from its date, unless the proxy provides for
a longer period.
(c) Voting may be by voice or by ballot as the presiding officer
of the meeting of the stockholders shall determine. On a vote by ballot,
each ballot shall be signed by the stockholder
2
<PAGE>
voting, or by such stockholder's proxy, and shall state the number of
shares voted.
(d) Shares of the Corporation held by another corporation may be
voted by such corporation's officer, agent or proxy as its by-laws may
prescribe, or in absence of such by-law provision, by any other person
designated by resolution of its Board of Directors, and such officer, agent
or other person so designated may vote such corporation's shares in this
Corporation in person or by proxy appointed by him.
(e) Shares held by an administrator, executor, guardian or
conservator may be voted by such representative, either in person or by
proxy, without a transfer of such shares into his name. Shares standing in
the name of a trustee, other than a trustee in bankruptcy, may be voted by
such representative, either in person or by proxy, but no such trustee
shall be entitled to vote shares held by him without a transfer of such
shares into his name.
(f) Shares standing in the name of a receiver, trustee in
bankruptcy, or assignee for the benefit of creditors may be voted by such
representative, either in person or by proxy. Shares held by or under the
control of such a receiver or trustee may be voted by such receiver or
trustee, either in person or by proxy, without the transfer thereof into
his name if authority so to do be contained in an appropriate order of the
court by which such receiver or trustee was appointed.
(g) A stockholder whose shares are pledged shall be entitled to
vote such shares until the shares have been transferred into the name of
the pledgee, and thereafter the pledgee shall be entitled to vote the
shares so transferred.
(h) If shares stand in the names of two or more persons, whether
fiduciaries, members of a partnership, joint tenants, tenants in common,
tenants by community property or otherwise, or if two or more persons have
the same fiduciary relationship respecting the same shares, unless the
Corporation is given written notice to the contrary and is furnished with
a copy of the instrument or order appointing them or creating the
relationship wherein it is so provided, their acts with respect to voting
shall have the following effect: (1) If only one votes, his act binds; (2)
If more than one votes, the act of the majority so voting binds all; and
(3) If more than one votes, but the vote is evenly split on any particular
matter, each fraction may vote the shares in question proportionally.
(i) Shares standing in the name of a married woman but not also
standing in the name of her husband with such a designation of mutual
relationship on the certificate, may be voted and all rights incident
thereto may be exercised in the same manner as if she were unmarried.
(j) Shares of its own stock belonging to the Corporation or to
another corporation, if a majority of the shares entitled to vote in the
elections of directors of such other corporation is held, directly or
indirectly, by the Corporation, shall neither be entitled to vote nor
counted for quorum purposes. Nothing in this Section shall be construed as
limiting the right of the Corporation to vote its own stock held by it in
a fiduciary capacity..
(k) In advance of or at any meeting of the stockholders, the
Chairman of the Board may appoint one or more persons as inspectors of
election (the "Inspectors") to act at such meeting. Such Inspectors shall
take charge of the ballots at such meeting. After the balloting on any
question, the Inspectors shall count the ballots cast and make a written
report to the secretary of such meeting of the
3
<PAGE>
results. Subject to the direction of the Chairman of the Board, the duties
of such Inspectors may further include without limitation: determining the
number of shares outstanding and the voting power of each; the shares
represented at the meeting; the existence of a quorum; the authenticity,
validity, and effect of proxies; receiving votes, ballots, or consents;
hearing and determining all challenges and questions in any way arising in
connection with the right to vote; counting and tabulating all votes of
consents and determining when the polls shall close; determining the
result; and doing such acts as may be proper to conduct the election or
vote with fairness to all stockholders. An Inspector need not be a
stockholder of the Corporation and any officer of the Corporation may be an
Inspector on any question other than a vote for or against such officer's
election to any position with the Corporation or any other questions in
which such officer may be directly interested. If there are three or more
Inspectors, the determination, report or certificate of a majority of such
Inspectors shall be effective as if unanimously made by all Inspectors.
2.4. LIST OF STOCKHOLDERS. The officer who has charge of the stock
ledger of the Corporation shall prepare and make available, at least ten
days or such other period of time as may be required by Federal, State or
other jurisdictional body whose rules and regulations govern the allotted
time before every meeting of stockholders, a complete list of the
stockholders entitled to vote thereat, arranged in either alphabetical
order or by zip code, showing the address of and the number of shares
registered in the names of each such stockholder. Such list shall be open
to the examination of any stockholder, for any purpose germane to such
meeting, either at a place within the city where such meeting is to be held
and which place shall be specified in the notice of such meeting, or, if
not so specified, at the place where such meeting is to be held. The list
also shall be produced and kept at the time and place of the meeting of the
stockholders during the whole time thereof, and may be inspected by any
stockholder who is present.
2.5. ACTION BY CONSENT OF STOCKHOLDERS. A resolution in writing,
signed by stockholders, representing a majority of those shares entitled
to vote shall be deemed to be the action of the stockholders to the effect
therein expressed with the same force and effect as if the same had been
duly passed by the same vote at a duly convened meeting, and it shall be
the duty of the Secretary of the Corporation to record such resolution in
the minute book of the Corporation under its proper date.
If stockholder action is taken without a meeting by less than
unanimous written consent, prompt notice shall be given to those
stockholders who have not consented in writing.
2.6. CONDUCT OF MEETINGS. The Chairman of the Board shall have full
and complete authority to determine the agenda, to set the procedures and
order the conduct of meetings, all as deemed appropriate by such person in
his sole discretion with due regard to the orderly conduct of business.
2.7. NOTICE OF AGENDA MATTERS. If a stockholder wishes to present
to the Chairman of the Board an item for consideration as an agenda item
for a meeting of stockholders, he must give timely notice to the Secretary
of the Corporation and give a brief description of the business desired to
be brought before the meeting. To be timely, a stockholder's notice must
be delivered to or mailed and received at the principal executive offices
of the Corporation not less than sixty days nor more than ninety days prior
to the meeting; provided, however, that if less than seventy days' notice
or prior to public disclosure of the date of the meeting is given or made
to stockholders, notice by the stockholder to be timely must be so received
not later than the close of business on the fifteenth day following the
date on which such notice of the date of the meeting was mailed or such
public disclosure was made and
4
<PAGE>
provided further that any other time period necessary to comply with
federal solicitation rules or other regulations, if applicable, shall be
deemed to be timely.
2.8. RECORD DATE.
(a) In order that the Corporation may determine the stockholders
entitled to notice of or to vote at any meeting of the stockholders or any
adjournment thereof, or entitled to receive payment of any dividend or
other distribution or allotment of any rights or entitlement to exercise
any rights in respect of any change, conversion or exchange of stock or for
the purpose of any other lawful action, the Board of Directors may fix, in
advance, a record date, which shall not be more than sixty nor less than
ten days prior to the date of such meeting nor more than sixty days prior
to any other action. If not fixed by the Board of Directors, the record
date shall be determined as provided by law.
(b) A determination of stockholders of record entitled to notice
of or to vote at a meeting of the stockholders shall apply to any
adjournments of the meeting, unless the Board of Directors fixes a new
record date for the adjourned meeting.
(c) Holders of stock on the record date are entitled to notice
and to vote or to receive the dividend, distribution or allotment of rights
or to exercise the rights, as the case may be, notwithstanding any transfer
of the shares set forth in the stock ledger of the Corporation after the
record date, except as otherwise provided by agreement or by law, the
Articles of Incorporation or these Bylaws.
2.9. INFORMALITIES AND IRREGULARITIES. All informalities or
irregularities in any call or notice of a meeting of the stockholders or in
the areas of credentials, proxies, quorums, voting and similar matters,
will be deemed waived if no objection is made at the meeting.
ARTICLE III
BOARD OF DIRECTORS
3.1. GENERAL POWERS. Unless otherwise restricted by law, the
Articles of Incorporation or these Bylaws as to action which shall be
authorized or approved by the stockholders, and subject to the duties of
directors as prescribed by these Bylaws, all corporate powers shall be
exercised by or under the authority of, and the business and affairs of the
Corporation shall be controlled by, the Board of Directors.
3.2. ELECTION OF DIRECTORS.
(a) NUMBER, QUALIFICATION AND TERM OF OFFICE. The authorized
number of directors of the Corporation shall be fixed from time to time by
the Board of Directors, but shall not be less than one nor more than nine.
The exact number of directors shall be determined from time to time by a
resolution duly adopted by a majority of the whole Board of Directors.
Directors need not be
5
<PAGE>
stockholders. Until increased by resolution of the Board of Directors, the
Board shall set at three members.
(b) RESIGNATION. Any director may resign from the Board of
Directors at any time by giving written notice to the Secretary of the
Corporation. Any such resignation shall take effect at the time specified
therein, or if the time when such resignation shall become effective shall
not be so specified, then such resignation shall take effect immediately
upon its receipt by the Secretary; and, unless otherwise specified therein,
the acceptance of such resignation shall not be necessary to make it
effective.
(c) NOMINATION OF DIRECTORS. Candidates for director of the
Corporation shall be nominated only either by:
(i) the Chairman of the Board or the Board of
Directors, or
(ii) nomination at any stockholders' meeting by or on
behalf of any stockholder entitled to vote thereat; provided,
that written notice of such stockholder's intent to make such
nomination or nominations shall have been given, either by
personal delivery or by United States certified mail, postage
prepaid, to the Secretary of the Corporation not later than (1)
with respect to an election to be held at an annual meeting of
the stockholders, twenty days in advance of such annual meeting,
and (2) with respect to an election to be held at a special
meeting of the stockholders for the election of directors, the
close of business of the fifteenth day following the date on
which notice of such special meeting is first given to the
stockholders entitled to vote thereat. Each such notice by a
stockholder shall set forth: (1) the name and address of the (A)
stockholder who intends to make the nomination and (B) person or
persons to be nominated; (2) a representation that the
stockholder is a holder of record of stock of the Corporation
entitled to vote at such meeting and intends to appear in person
or by proxy at the meeting to nominate the person or persons
specified in the notice; (3) a description of all arrangements or
understandings between the stockholder and each nominee and any
other person or persons (naming such person or persons) pursuant
to which the nomination or nominations are to be made by the
stockholder; (4) such other information regarding each nominee
proposed by such stockholder as would be required to be included
in a proxy or information statement filed with the Securities and
Exchange Commission pursuant to the proxy rules promulgated under
the Securities Exchange Act of 1934, as amended, or any successor
statute thereto, had the nominee been nominated, or intended to
be nominated, by the Board of Directors; and (5) the manually
signed consent of each nominee to serve as a director of the
Corporation if so elected. The presiding officer of the meeting
of the stockholders may refuse to acknowledge the nominee of any
person not made in compliance with the foregoing procedure.
(d) VACANCIES. Vacancies and new directorships resulting from
an increase in the authorized number of directors may be filled by a
majority of the directors then in office, though less than a quorum, or by
the sole remaining director. Directors so chosen shall hold office until
their successors are duly elected at the annual meeting and qualified. If
no directors are in office, an election may be held as provided by statute.
6
<PAGE>
3.3 MEETINGS OF THE BOARD OF DIRECTORS.
(a) REGULAR MEETINGS. Regular meetings of the Board of
Directors shall be held without call, and without any requirement of
notice, at the following times:
(i) at such times as the Board of Directors shall from
time to time by resolution determine; and
(ii) one-half hour prior to any special meeting of the
stockholders and immediately following the adjournment of any
annual or special meeting of the stockholders.
(b) SPECIAL MEETINGS. Special meetings of the Board of
Directors may be called by the Chairman of the Board, or the Board of
Directors pursuant to a resolution approved by a majority of the whole
Board of Directors. Notice of the time and place of special meetings of
the Board of Directors shall be given by the Secretary or an Assistant
Secretary of the Corporation, or by any other officer authorized by the
Board of Directors. Such notice shall be given to each director personally
or by mail, messenger, telephone or telegraph at such director's business
or residence address. Notice by mail shall be deposited in the United
States mail, postage prepaid, not later than the fifth day prior to the
date fixed for such special meeting. Notice by telephone or telegraph
shall be sent, and notice given personally or by messenger shall be
delivered, at least twenty-four hours prior to the time set for such
special meeting. Notice of a special meeting of the Board of Directors
need not contain a statement of the purpose of such special meeting.
(c) ADJOURNED MEETINGS. A majority of directors present at
any regular or special meeting of the Board of Directors or any committee
thereof, whether or not constituting a quorum, may adjourn any meeting from
time to time until a quorum is present or otherwise, however, notice of the
time and place of holding any adjourned meeting shall be required as
provided in Section 3.3(b) of these Bylaws.
(d) PLACE OF MEETINGS. Meetings of the Board of Directors,
both regular and special, may be held either within or without the State of
Nevada.
(e) PARTICIPATION BY TELEPHONE. Members of the Board of
Directors or any committee may participate in any meeting of the Board of
Directors or committee through the use of conference telephone or similar
communications equipment, so long as all members participating in such
meeting can hear one another, and such participation shall constitute
presence in person at such meeting.
(f) QUORUM. At all meetings of the Board of Directors or any
committee thereof, a majority of the total number of directors of the
entire then authorized Board of Directors or such committee shall
constitute a quorum for the transaction of business and the act of a
majority of the directors present at any such meeting at which there is a
quorum shall be the act of the Board of Directors or any committee, except
as may be otherwise specifically prohibited by law, the Articles of
Incorporation or these Bylaws. A meeting of the Board of Directors or any
committee at which a quorum initially is present may continue to transact
business notwithstanding the withdrawal of directors
7
<PAGE>
so long as any action is approved by at least a majority of the required
quorum for such meeting.
(g) WAIVER OF NOTICE. The transactions of any meeting of the
Board of Directors or any committee, however called and noticed or wherever
held, shall be as valid as though had at a meeting duly held after regular
call and notice, if a quorum be present and if, either before or after the
meeting, each of the directors not present signs a written waiver of
notice, or a consent to hold such meeting, or an approval of the minutes
thereof. All such waivers, consents or approvals shall be filed with the
corporate records or made a part of the minutes of the meeting.
3.5. ACTION WITHOUT MEETING. Any action required or permitted to be
taken by the Board of Directors at any meeting or at any meeting of a
committee may be taken without a meeting if all members of the Board of
Directors or such committee consent in writing and the writing or writings
are filed with the minutes of the proceedings of the Board of Directors or
such committee.
3.6. COMPENSATION OF DIRECTOR. Unless otherwise restricted by law,
the Articles of Incorporation or these Bylaws, the Board of Directors shall
have the authority to fix the compensation of directors. The directors may
be paid their expenses, if any, of attendance at each meeting of the Board
of Directors and may be paid a fixed sum for attendance at each meeting of
the Board of Directors or a stated salary as a director. No such payment
shall preclude any director from serving the Corporation in any other
capacity and receiving compensation therefor. Members of committees of the
Board of Directors may be allowed like compensation for attending committee
meetings.
3.7. COMMITTEES OF THE BOARD.
(a) EXECUTIVE COMMITTEE. The Board of Directors may, by
resolution adopted by a majority of the whole Board, name two or more of
its members and General Counsel, or such other legal advisor as it deems
appropriate, as an Executive Committee. Such Executive Committee will have
and may exercise the powers of the Board of Directors in the management of
the business and affairs of the Corporation while the Board is not in
session, subject to such limitations as may be included in the Board's
resolution; provided, however, that such Executive Committee shall not have
the authority of the Board of Directors in reference to the following
matters: (1) the submission to stockholders of any action that requires
the authorization or approval under applicable law; (2) the filling of
vacancies on the Board of Directors or in any committee of the Board of
Directors; (3) the amendment or repeal of these Bylaws, or the adoption of
new bylaws; and (4) the fixing of compensation of Directors for serving on
the Board or on any Committee of the Board of Directors. A majority of
those named to the Executive Committee will constitute a quorum and the
Committee may at any time act by the written consent of a quorum thereof,
although not formally convened.
(b) OTHER COMMITTEES. The Board of Directors may from time to
time, by resolution adopted by a majority of the whole Board, appoint other
standing or temporary Committees consisting of at least one current member
of the Board of Directors, and such other individuals as the Board of
Directors may determine. These Committees will be vested with such powers
as the Board may include in its resolution; provided, however, that such
Committees shall be restricted in their authority that all actions taken
are subject to review and ratification by the Executive Committee and the
Board of Directors. A majority of those named to any such Committees will
constitute a quorum and the Committee may at any time act by the
8
<PAGE>
written consent of a quorum thereof, although not formally convened.
(c) MINUTES OF MEETINGS. Each committee shall keep regular
minutes of its meetings and report the same to the Board of Directors when
required.
3.8. INTERESTED DIRECTORS. In addition to the statutory and
corporate common law of Nevada, no contract or transaction between the
Corporation and one or more of its directors or officers, or between the
Corporation and any other corporation, partnership, association, or other
organization in which one or more of its directors or officers are
directors or officers, or have a financial interest, shall be void or
voidable solely for this reason, or solely because the director or officer
is present at or participates in the meeting of the Board of Directors or
committee thereof which authorizes the contract or transaction, or solely
because his or their votes are counted for such purpose if (i) the material
facts as to his or their relationship or interest and as to the contract or
transaction are disclosed or are known to the Board of Directors or
committee in good faith authorizes the contract or transaction by the
affirmative votes of a majority or the disinterested directors, even though
the disinterested directors be less than a quorum; or (ii) the material
facts as to his or their relationship or interest and as to the contract or
transaction are disclosed or are known to the stockholders entitled to vote
thereon, and the contract or transaction is specifically approved in good
faith by vote of the stockholders; or (iii) the contract or transaction is
fair as to the Corporation as of the time it is authorized, approved or
ratified, by the Board of Directors, a committee thereof or the
stockholders. Common or interested directors may be counted in determining
the presence of a quorum at a meeting of the Board of Directors or of a
committee which authorizes the contract or transaction.
ARTICLE IV
OFFICERS
4.1. OFFICERS.
(a) NUMBER. The officers of the Corporation shall be chosen
by the Board of Directors and will include a Chairman of the Board of
Directors (who must be a director as chosen by the Board of Directors), a
President, Secretary and a Treasurer and may include Chief Officers and any
number of Vice-Presidents. The Board of Directors also may appoint one or
more Assistant Secretaries or Assistant Treasurers and such other officers
and agents with such powers and duties as it shall deem necessary. Any
Vice President may be given such specific designation as may be determined
from time to time by the Board of Directors. Any number of offices may be
held by the same person, unless otherwise restricted by law, the Articles
of Incorporation or these Bylaws. The Board of Directors may delegate to
any other officer of the Corporation the power to choose such other
officers and to prescribe their respective duties and powers.
(b) ELECTION AND TERM OF OFFICE. The officers shall be
elected annually by the Board of Directors at its regular meeting following
the annual meeting of the stockholders and each officer shall hold office
until the next annual election of officers and until such officer's
successor is elected and qualified, or until such officer's death,
resignation or removal. Any officer may be removed at any time, with or
without cause, by a vote of the majority of the whole Board of Directors.
Any vacancy occurring in any office may be filled by the Board of
Directors.
9
<PAGE>
(c) SALARIES. THE SALARIES OF ALL OFFICERS OF THE CORPORATION
shall be fixed by the Board of Directors or a committee thereof from time
to time.
4.2. CHAIRMAN OF THE BOARD OF DIRECTORS. The Board of Directors
will elect a Chairman to serve as a Non-Executive Officer of the
Corporation. The Chairman will preside at all meetings of the Board of
Directors and be vested with such other powers and duties as the Board may
from time to time delegate to him.
4.3. CHIEF OFFICERS. The Board of Directors may elect a Chief
Executive Officer, a Chief Financial Officer and a Chief Operating Officer,
all of whom shall also be Directors of the Corporation. The Chief Executive
Officer shall be the presiding officer over all business affairs of the
Corporation, subject only to the direction of the Board of Directors. The
Chief Financial Officer of the Corporation shall be the presiding officer
over the financial affairs of the Corporation, subject only to the
direction of the Board of Directors and the Chief Executive Officer. The
Chief Operating Officer of the Corporation shall be the presiding officer
over the operational affairs of the Corporation, subject only to the
direction of the Board of Directors and the Chief Executive Officer. Except
as may otherwise be specifically provided in a resolution of the Board of
Directors, the Chief Officers will be proper officers to sign on behalf of
the Corporation any deed, bill of sale, assignment, option, mortgage,
pledge, note, bond, evidence of indebtedness, application, consent (to
service of process or otherwise), agreement, indenture or other instrument
of any significant importance to the Corporation.
4.4. PRESIDENT. The President, absent the election of a Chief
Executive Officer, will supervise the business and affairs of the
Corporation and the performance by all of its other officers, excluding
Chief Officers, of their respective duties, subject to the control of the
Board of Directors. Absent the election of a Chief Executive Officer by the
Board of Directors, the President will be the Chief Executive Officer of
the Corporation. Except as may otherwise be specifically provided in a
resolution of the Board of Directors, the President will be a proper
officer to sign on behalf of the Corporation any deed, bill of sale,
assignment, option, mortgage, pledge, note, bond, evidence of indebtedness,
application, consent (to service of process or otherwise), agreement,
indenture or other instrument of any significant importance to the
Corporation. The President may represent the Corporation at any meeting of
the stockholders of any other Corporation in which this Corporation then
holds shares, and may vote this Corporation's shares in such other
corporation in person or by proxy appointed by him, provided that the Board
of Directors may from time to time confer the foregoing authority upon any
other person or persons. The President may designate any Vice President to
perform any acts, on behalf of the Corporation, in his place.
4.5. VICE PRESIDENTS. One or more Vice Presidents may be elected by
the Board of Directors each of whom (in the order designated by the Board)
will be vested with all of the powers and charged with all of the duties
(including those herein before specifically set forth) of the President in
the event of his absence or disability. Each Vice President will perform
such other duties as may from time to time be delegated or assigned to
him/her by the Board of
10
<PAGE>
Directors, Chief Executive Officer, Chief Operating Officer or the
President, in that order.
4.6. SECRETARY AND ASSISTANT SECRETARIES. The Secretary will keep
the minutes of meetings of the stockholders, Board of Directors and any
Committee, and all unanimous written consents of the stockholders, Board of
Directors and any Committee of the Corporation, see that all notices are
duly given in accordance with the provisions of these By-Laws or as
required by applicable law, be custodian of the Corporate Seal and
Corporate Records, and, in general, perform all duties incident to his
office. Except as may otherwise be specifically provided in a resolution of
the Board of Directors, the Secretary and each Assistant Secretary will be
a proper officer to take charge of the Corporation's stock ledger, and to
compile the voting record, and to impress the Corporation's Seal on any
instrument signed by a duly authorized or empowered officer, and to attest
to the same.
4.7. TREASURER AND ASSISTANT TREASURERS. The Treasurer, absent the
election of a Chief Financial Officer, shall serve as the Chief Financial
Officer and will maintain the financial records of the Corporation and
supervise all Corporate reporting with any and all government agencies. The
Treasurer will keep full and accurate accounts of receipts and
disbursements in books belonging to the Corporation, and will cause all
money and other valuable effects to be deposited in the name and to the
credit of the Corporation in such depositories, subject to withdrawal in
such manner as may be designated by the Board of Directors and the Chief
Executive Officer. The Treasurer will render to the President and to the
Directors (at the regular meetings of the Board or whenever they may
require), an account of all his transactions, as Treasurer, and of the
financial condition of the Corporation.
ARTICLE V
INDEMNIFICATION AND INSURANCE
5.1. RIGHT TO INDEMNIFICATION. Subject to the terms and conditions
of this Article V, each officer or director of the Corporation who was or
is made a party or witness or is threatened to be made a party or witness
to or is otherwise involved in any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or
investigative (hereinafter a "proceeding"), by reason of the fact that he
is or was a director or officer of the Corporation or is or was serving at
the request of the Corporation as a director, officer, employee or agent of
another corporation or of a partnership, joint venture, trust or other
enterprise, including service with respect to employee benefit plans
(hereinafter an "indemnitee"), whether the basis of such proceeding is
alleged action or inaction in an official capacity while serving as a
director, officer, employee or agent, shall be indemnified and held
harmless by the Corporation to the fullest extent authorized by the general
corporate law of Nevada as set forth in Section 78 et. seq. of the Nevada
Revised Statutes ("GCL"), as the same exists or may hereafter be amended
(but, in the case of any such amendment, only to the extent that such
amendment permits the Corporation to provide broader indemnification rights
than such law permitted the Corporation to provide prior to such
amendment), against all expense, liability and loss (including attorney's
fees, judgements, fines, ERISA excise taxes or penalties and amounts paid
in settlement) reasonably incurred or suffered by such indemnitee who has
ceased to be a director, officer, employee or agent and shall inure to the
benefit of the indemnitee's heirs, executors and administrators; provided,
11
<PAGE>
however, that, except as provided in Article V hereof with respect to
proceedings to enforce rights to indemnification, the Corporation shall
indemnify any such indemnitee in connection with a proceeding (or part
thereof) initiated by such indemnitee only if such proceeding (or part
thereof) was authorized by the Board of Directors of the Corporation. The
right to indemnification conferred in this Section shall include the right
to be paid by the Corporation the expenses incurred in defending any such
proceeding in advance of its final disposition (hereinafter an "advancement
of expenses"); provided, however, that, if the GCL requires, an advancement
of expenses incurred by an indemnitee shall be made only upon delivery to
the Corporation of an undertaking in the form then required by the GCL (if
any), by or on behalf of such indemnitee, with respect to the repayment of
amounts so advanced (hereinafter an "undertaking").
5.2. RIGHT TO INDEMNITEE TO BRING SUIT. If a claim under Section
5.1 of this Article is not paid in full by the Corporation within sixty
days after a written claim has been received by the Corporation, except in
the case of a claim for an advancement of expenses, in which case the
applicable period shall be twenty days, the indemnitee may at any time
thereafter bring suit against the Corporation to recover the unpaid amount
of the claim. If successful in whole or in part in any such suit or in a
suit brought by the Corporation to recover an advancement of expenses
pursuant to the terms of an undertaking, the indemnitee shall be entitled
to be paid also the expenses of prosecuting or defending such suit. In (i)
any suit brought by the indemnitee to enforce a right to indemnification
hereunder (but not in a suit brought by the indemnitee to enforce a right
to an advancement of expenses) it shall be a defense that, and (ii) any
suit by the Corporation to recover an advancement of expenses pursuant to
the terms of an undertaking the Corporation shall be entitled to recover
such expenses upon a final adjudication that, the indemnitee has not met
the applicable standard of conduct set forth in the GCL. Neither the
failure of the Corporation (including the Board of Directors, independent
legal counsel, or its stockholders) to have made a determination prior to
the commencement of such suit that indemnification of the indemnitee is
proper in the circumstances because the indemnitee has met the applicable
standard of conduct set forth in the GCL, nor an actual determination by
the Corporation (including its Board of Directors, independent legal
counsel or its stockholders) that the indemnitee has not met such
applicable standard of conduct, shall create a presumption that the
indemnitee has not met the applicable standard of conduct or, in the case
of such suit brought by the indemnitee, be a defense to such suit. In any
suit brought by the indemnitee to enforce a right hereunder, or by the
Corporation to recover an advancement of expenses pursuant to he terms of
an undertaking, the burden of proving that the indemnitee is not entitled
to be indemnified or to such advancement of expenses under this Section or
otherwise shall be on the Corporation.
5.3. SPECIFIC LIMITATIONS ON INDEMNIFICATION. Notwithstanding
anything in this Article to the contrary, the Corporation shall not be
obligated to make any payment to any indemnitee with respect to any
proceeding (i) to the extent that payment is actually made to the
indemnitee under any insurance policy, or is made to indemnitee by the
Corporation or an affiliate thereof otherwise than pursuant to this
Article, (ii) for any expense, liability or loss in connection with a
proceeding settled without the Corporation's written consent, which
consent, however, shall not be unreasonably withheld, (iii) for an
accounting of profits made from the purchase or sale by the indemnitee of
securities of the Corporation within the meaning of Section 16(b) of the
Securities Exchange Act of 1934, as amended, or similar provisions of any
state statutory or common law, (iv) where the indemnitee acted in bad faith
or with gross negligence, or (v) where prohibited by applicable law.
12
<PAGE>
5.4. CONTRACT. The provisions of this Article shall be deemed to be
a contract between the Corporation and each director and officer who serves
in such capacity at any time while such Section is in effect, and any
repeal or modification thereof shall not affect any rights or obligations
then existing with respect to any state of facts then or theretofore
existing or any action, suit or proceeding theretofore or thereafter based
in whole or in part upon any such state of facts.
5.5. PARTIAL INDEMNITY. If the indemnitee is entitled under any
provision of this Article to indemnification by the Corporation for some or
a portion of the expenses, liabilities or losses incurred in connection
with a proceeding but not, however, for all of the total amount thereof,
the Corporation shall nevertheless indemnify the indemnitee for the portion
thereof to which the indemnitee is entitled. Moreover, notwithstanding any
other provision of this Article, to the extent that the indemnitee has been
successful on the merits or otherwise in defense of any or all claims
relating in whole or in part to a proceeding or in defense of any issue or
matter therein, including dismissal without prejudice, the indemnitee shall
be indemnified against all loss, expense and liability incurred in
connection with the portion of the proceeding with respect to which
indemnitee was successful on the merits or otherwise.
5.6. NON-EXCLUSIVITY OF RIGHTS. The rights to indemnification and
to the advancement of expenses conferred in this Article shall not be
exclusive of any other right which any person may have or hereafter acquire
under any statute, the Articles of Incorporation, these Bylaws, agreement,
vote of stockholders or disinterested directors or otherwise.
5.7. INSURANCE. The Corporation may maintain insurance, at its
expense, to protect itself and any director, officer, employee or agent of
the Corporation or another corporation, partnership, joint venture, trust
or other enterprise against any expense, liability or loss, whether or not
the Corporation would have the power to indemnify such person against such
expense, liability or loss under the GCL.
5.8. INDEMNIFICATION OF EMPLOYEES AND AGENTS OF THE CORPORATION.
The Corporation may, to the extent authorized from time to time by the
Board of Directors, grant rights to indemnification and to the advancement
of expenses, to any employee or agent of the Corporation to the fullest
extent of the provisions of this Article with respect to the
indemnification and advancement of expenses of directors and officers of
the Corporation, or to such lesser extent as may be determined by the Board
of Directors.
5.9. NOTICE BY INDEMNITEE AND DEFENSE OF CLAIM. The indemnitee
shall promptly notify the Corporation in writing upon being served with any
summons, citation, subpoena, complaint, indictment, information or other
document relating to any matter, whether civil, criminal, administrative or
investigative, but the omission so to notify the Corporation will not
relieve it from any liability which it may have to the indemnitee if such
omission does not prejudice the Corporation's rights. If such omission
does prejudice the Corporation's rights, the Corporation will be relieved
from liability only to the extent of such prejudice; nor will such omission
relieve the Corporation from any liability which it may have to the
indemnitee otherwise than under this Article V. With respect to any
proceedings as to which the indemnitee notifies the Corporation of the
commencement thereof:
(a) The Corporation will be entitled to participate therein at
its own expense; and
(b) The Corporation will be entitled to assume the defense
thereof, with counsel reasonably satisfactory to the indemnitee; provided,
however, that the Corporation shall not be entitled to assume the defense
of any proceeding (and this Section 5.9 shall be inapplicable to such
proceeding) if
13
<PAGE>
the indemnitee shall have reasonably concluded that there may be a conflict
of interest between the Corporation and the indemnitee with respect to such
proceeding. After notice from the Corporation to the indemnitee of its
election to assume the defense thereof, the Corporation will not be liable
to the indemnitee under this Article V for any expenses subsequently
incurred by the indemnitee in connection with the defense thereof, other
than reasonable costs of investigation or as otherwise provided below.
The indemnitee shall have the right to employ his own counsel in such
proceeding but the fees and expenses of such counsel incurred after notice
from the Corporation of its assumption of the defense thereof shall be at
the expense of the indemnitee unless:
(i) The employment of counsel by the indemnitee has
been authorized by the Corporation in writing; or
(ii) The Corporation shall not have employed counsel to
assume the defense in such proceeding or shall not have assumed
such defense and be acting in connection therewith with
reasonable diligence;
in each of which cases the fees and expenses of such counsel shall be at
the expense of the Corporation.
(c) The Corporation shall not settle any proceeding in any
manner which would impose any penalty or limitation on the indemnitee
without the indemnitee's written consent; provided, however, that the
indemnitee will not unreasonably withhold his consent to any proposed
settlement.
ARTICLE VI
CERTIFICATES FOR SHARES AND THEIR TRANSFER
6.1. CERTIFICATES FOR SHARES. Unless otherwise provided by a
resolution of the Board of Directors, the shares of the Corporation shall
be represented by a certificate. The certificates of stock of the
Corporation shall be numbered and shall be entered in the stock ledger of
the Corporation as they are issued. They shall exhibit the holder's name
and number of shares and shall be signed by or in the name of the
Corporation by (a) the Chairman of the Board of Directors, or the
President or any Vice-President and (b) the Secretary or any Assistant
Secretary. Any or all of the signatures on a certificate may be facsimile.
In case any officer of the Corporation, transfer agent or registrar who has
signed, or whose facsimile signature has been placed upon such certificate,
shall have ceased to be such officer, transfer agent or registrar before
such certificate is issued, such certificate may nevertheless be issued by
the Corporation with the same effect as if he were such officer, transfer
agent or registrar at the date of issuance.
6.2. CLASSES OF STOCK.
(a) If the Corporation shall be authorized to issue more than
one class of stock or more than one series of any class, the powers,
designations, preferences and relative participating, optional or other
special rights of each class of stock or series thereof and the
qualification, limitations, or restrictions of such preferences or rights
shall be set forth in full or summarized on the face or back of the
certificate that the Corporation shall issue to represent such class or
series of stock; provided, that, except as otherwise provided in Section
78.195(5) of the Nevada Revised Statutes in lieu of the foregoing
requirements, there may be set forth on the face or back of the certificate
that the Corporation shall issue to represent such class or series of
stock, a statement that the Corporation will furnish without
14
<PAGE>
charge to each stockholder who so requests the powers, designations,
preferences and relative participating, optional or other special rights of
each class of stock or series thereof and the qualifications, limitations
or restrictions of such preferences or rights.
(b) Within a reasonable time after the issuance or transfer of
uncertified stock, the Corporation shall send to the registered owner
thereof a written notice containing the information required to be set
forth or stated on certificates pursuant to applicable law (including
Sections 78.195, 78.205, 78.235 and 78.242 of the Nevada Revised Statutes)
or a statement that the Corporation will furnish without charge to each
stockholder who so requests the powers, designations, preferences and
relative participating, optional or other special rights of each class of
stock or series thereof and the qualifications, limitations or restrictions
of such preferences or rights.
6.3. TRANSFER. Upon surrender to the Corporation or the transfer
agent of the Corporation of a certificate for shares duly endorsed or
accompanied by proper evidence of succession, assignation or authority to
transfer, it shall be the duty of the Corporation to issue a new
certificate to the person entitled thereto, cancel the old certificate and
record the transaction upon its stock ledger. Upon receipt of proper
transfer instructions from the registered owner of uncertified shares, such
uncertified shares shall be canceled, issuance of new equivalent
uncertified shares or certified shares shall be made to the person entitled
thereto and the transaction shall be recorded upon the stock ledger of the
Corporation.
6.4. RECORD OWNER. The Corporation shall be entitled to treat the
holder of record of any share or shares of stock as the holder in fact
thereof, and, accordingly, shall not be bound to recognize any equitable or
other claim to or interest in such share on the part of any other person,
whether or not it shall have express or other notice thereof, save as
expressly provided by the laws of the State of Nevada.
6.5. LOST CERTIFICATES. The Board of Directors may direct a new
certificate or certificates or uncertified shares to be issued in place of
any certificate or certificates theretofore issued by the Corporation
alleged to have been lost, stolen or destroyed, upon the making of an
affidavit of that fact by the person claiming the certificate of stock to
be lost, stolen or destroyed. When authorizing such issue of a new
certificate or certificates or uncertified shares, the Board of Directors
may, in its discretion and as a condition precedent to the issuance
thereof, require the owner of such lost, stolen or destroyed certificate or
certificates, or his legal representative, to advertise the same in such
manner as the Board of Directors shall require to give the Corporation a
bond in such sum as it may direct as indemnity against any claim that may
be made against the Corporation with respect to the certificate alleged to
have been lost stolen or destroyed.
ARTICLE VII
MISCELLANEOUS
7.1. EXECUTION OF INSTRUMENTS. The Board of Directors may, in its
discretion, determine the method and designate the signatory officer or
officers, or other persons, to execute any corporate instrument or document
or to sign the corporate name without limitation, except where otherwise
provided by law, the Articles of Incorporation or these Bylaws. Such
designation may be general or confined to specific instances.
15
<PAGE>
7.2. VOTING OF SECURITIES OWNED BY THE CORPORATION. All stock and
other securities of other corporations held by the Corporation shall be
voted, and all proxies with respect thereto shall be executed, by the
person so authorized by resolution of the Board of Directors, or, in the
absence of such authorization, by the Chairman of the Board.
7.3. CORPORATE SEAL. A corporate seal shall not be requisite to the
validity of any instrument executed by or on behalf of the Corporation. If
a corporate seal is used, the same shall be at the pleasure of the officer
affixing seal either (a) a circle having on the circumference thereof the
words "RENAISSANCE INTERNATIONAL GROUP, LTD." and in the center
"Incorporated - 1994, Nevada", or (b) a seal containing the words
"Corporate Seal" in the center thereof.
7.4. CONSTRUCTION AND DEFINITIONS. Unless the context requires
otherwise the general provisions, rules of construction and definitions in
the Nevada Revised Statutes and the Articles of Incorporation shall govern
the construction of these Bylaws.
7.5. AMENDMENTS. These Bylaws may be altered, amended or repealed
by a majority vote of the Board of Directors or the stockholders.
7.6. DESCRIPTIVE HEADINGS. The descriptive headings of the
paragraphs of these Bylaws are inserted for convenience only and shall not
control or affect the meaning or construction of any provision hereof.
7.7. REFERENCE THERETO. Any reference herein made to the
Corporation's Articles will be deemed to refer to its Articles of
Incorporation and all Amendments thereto as at any given time on file with
the Nevada Secretary of State, together with any and all certificates
theretofore filed by the Corporation with the Nevada Secretary of State
pursuant to applicable law.
7.8. SENIORITY THEREOF. The Articles will in all respects be
considered senior and superior to these By-Laws, with any inconsistency to
be resolved in favor of the Articles, and with these By-Laws to be deemed
automatically amended from time to time to eliminate any such inconsistency
which may then exist.
7.9. NUMBER AND GENDER. Whenever used herein, the singular number
shall include the plural and the singular, and the use of any gender shall
be applicable to all genders.
16
<PAGE>
CERTIFICATE OF ADOPTION
-----------------------
The undersigned, Secretary of the Corporation, hereby testifies the
foregoing Bylaws were adopted by the Board of Directors of Renaissance
International Group, Ltd., a Nevada Corporation, pursuant to a written
consent and resolution of the Board of Directors dated July 3, 1997.
July 3, 1997 /s/ PETER DE KREY
____________________________________
Peter de Krey, Corporate Secretary
17
EXHIBIT 10(i)
EMPLOYMENT AGREEMENT
THIS AGREEMENT (this "Agreement") is by and between RENAISSANCE
INTERNATIONAL GROUP, LTD., a Nevada corporation ("Company"), and KEVIN
JONES, an individual ("Employee").
RECITALS:
A. Company is engaged, among other things, in the business of
managing and operating medical facilities and developing digital interface
technology systems for the medical and related industries ("Company
Business").
B. Company desires to retain the services of Employee as an
executive, to act as its SENIOR VICE PRESIDENT OF OPERATIONS/CHIEF
OPERATING OFFICER, and Employee desires and is willing to continue
employment with the Company in that capacity.
C. Company and Employee desire to embody the terms and conditions of
Employee's employment in a written agreement, which will supersede all
prior agreements of employment, whether written or oral, pursuant to the
terms and conditions hereinafter set forth.
D. The Board of Directors of Company (the "Board"), has determined
that it is in the best interests of Company and its shareholders to assure
that Company will have the continued dedication of Employee,
notwithstanding the possibility, threat or occurrence of a Change of
Control (as defined in Section 6(f)) of Company. The Board believes it is
imperative to diminish the inevitable distraction of Employee by virtue of
the personal uncertainties and risks created by a pending or threatened
Change of Control and to encourage Employee's full attention and dedication
to Company currently and in the event of any threatened or pending Change
of Control, and to provide Employee with compensation and benefits
arrangements upon a Change of Control which ensure that the compensation
and benefits expectations of Employee will be satisfied and which are
competitive with those of other corporations. Therefore, in order to
accomplish these objectives, the Board has caused Company to enter into
this Agreement.
AGREEMENT
In consideration of the recitals and mutual agreements hereinafter set
forth, the parties agree as follows:
1. EMPLOYMENT. Company agrees to continue to employ Employee on a
full-time basis, in accordance with the terms and conditions set forth
herein, and Employee agrees to accept such continued full-time employment
in accordance with said terms and conditions. Employee shall have such
duties and responsibilities as shall be allocated to him from time to time
by the Board in his capacity as the Senior Vice President of
Operations/Chief Operating Officer. Employee's title and duties may be
changed from time to time in the discretion of Company's Board so long as
he is maintained in an executive capacity with duties, responsibilities and
privileges commensurate with his current level of employment. Employee
agrees to devote his full time, skill, knowledge and attention to the
business of Company and the performance of his duties under this Agreement.
Employee shall report directly to the President of Company.
2. TERM. The initial term (the "Term") of employment under this
Agreement shall commence on February 1, 1998 (the "Effective Date") and
shall continue for a period of five (5)
<PAGE>
years, unless earlier terminated as set forth in Section 6 below.
Thereafter, this Agreement shall automatically renew for an additional
three-year period (the "Renewal Term") unless either party gives the other
written notice of non-renewal at least 30 days prior to the expiration of
the Term or Renewal Term.
3. COMPENSATION.
(a) BASE SALARY. Company agrees to pay Employee an initial
annual base salary of $120,000, before deducting all applicable
withholdings which shall be payable in accordance with Company's
standard executive payroll policies as they may be revised from time
to time. Employee's annual base salary shall thereafter be subject to
annual adjustment in accordance with Company's standard executive
compensation policies, but in no event shall Employee's annual base
salary be less than $120,000 per year during the Term or Renewal Term.
(b) INCENTIVE BONUS. After commencing his duties as Senior Vice
President of Operations/Chief Operating Officer, Company's Executive
Committee shall, at its option, design and present to the Board for
review, adjustment and adoption, an incentive compensation program for
key employees. Employee shall be designated as a key employee and
shall be entitled to participate in such program, and if financial
targets established pursuant to the program are met, will be eligible
to earn in any year an additional maximum amount of compensation in
the form of stock, stock options and/or cash as determined by
Company's Executive Committee.
(c) DEDUCTIONS. Company shall deduct from the payments made to
Employee hereunder any federal, state or local withholding or other
taxes or charges which Company is required to deduct under applicable
law, and all amounts payable to Employee under this Agreement are
stated before any such deductions. Company shall have the right to
rely upon written opinion of counsel if any questions arise as to any
deductions.
4. BENEFITS.
2
<PAGE>
(a) INSURANCE. In addition to the compensation described above,
while Employee is employed hereunder, Company shall pay for and
provide Employee and his dependents with the same amount and type of
health, medical and life insurance as is provided from time to time to
executive officers of Company during the Term and Renewal Term, if
applicable.
(b) EXPENSE REIMBURSEMENT. In addition to the compensation and
benefits provided above, Company shall, upon prior approval of the
Executive Committee and receipt of appropriate documentation,
reimburse Employee each month for his reasonable travel, lodging and
other ordinary and necessary business expenses consistent with
Company's policies as in effect from time to time.
(c) RETIREMENT PLAN. In addition to the compensation and
benefits provided above, Company shall pay for and provide Employee a
retirement or pension plan as is provided from time to time to
executive officers of Company during the Term and Renewal Term, if
applicable.
5. VACATION. Employee shall be entitled to vacation with pay in
accordance with Company's vacation policy as in effect from time to time.
In addition, Employee shall be entitled to such holidays as Company may
approve for its executive personnel.
6. TERMINATION. The Board may terminate Employee's employment by
Company prior to the expiration of the Term or Renewal Term in the manner
provided in either Section 6(a) or Section 6(b). Additionally, if notice
of non-renewal is given pursuant to Section 2, the term of employment shall
expire at the end of the Term and Employee shall be entitled to
compensation as provided in Section 6(e).
(a) FOR CAUSE. Company may terminate this Agreement for cause
upon written notice to the Employee stating the facts constituting
such cause, provided that Employee shall have 10 days following such
notice to cure any conduct or act, if curable, alleged to provide
grounds for termination for cause hereunder. In the event of
termination for cause, any unexercised stock options granted pursuant
to Section 3(c) shall automatically expire, and Company shall be
obligated to pay Employee only the salary due him through the date of
termination pursuant to Section 3(a). Cause shall include material
neglect of duties, failure to abide by ethical and good faith
instructions or policies from or set by the Board, conviction of a
felony or serious misdemeanor offense or pleading guilty or NOLO
CONTENDERE to same, the commission by Employee of an act of dishonesty
or moral turpitude, Employee's breach of this Agreement, breach by
Employee of any other material obligation to Company, or upon the
bankruptcy, receivership, dissolution or cessation of business of
Company.
(b) WITHOUT CAUSE. Any termination of Employee by Company for
any other reason than for cause shall constitute a termination without
cause. Any termination resulting from a Change of Control as defined
below shall constitute a termination without cause without the
necessity of written notice to Employee. Upon termination under this
Section 6(b), Company shall (i) pay to Employee his base salary at the
time of termination due him through the date of the expiration of the
Term, or Renewal Term, if applicable; and (ii) within 60 days after
the end of the fiscal year in which termination pursuant to this
Section 6(b) occurs, Employee shall be entitled to receive a
separation payment as defined below.
(c) DISABILITY. If during the Term, or Renewal Term, if
applicable, Employee fails to perform his duties hereunder because of
physical or mental illness or other incapacity for a period of two
consecutive months, or for 45 days during any 120-day period, Company
3
<PAGE>
shall have the right to terminate this Agreement without further
obligation hereunder except for any bonus amount payable in accordance
with this Section 6(c) and any amounts payable pursuant to disability
plans generally applicable to executive employees. Company shall
provide Employee with notice of commencement of the disability period,
which period cannot commence more than seven (7) days prior to the
date of the notice. If there is any dispute as to whether Employee is
or was physically or mentally disabled under this Agreement, or
whether his disability has ceased and he is able to resume his duties,
such question shall be submitted to a licensed physician agreed upon
by the parties. Employee shall submit to such examinations and
provide information as such physician may request, and the
determination of such physician as to Employee's physical or mental
condition shall be binding and conclusive on the parties. Company
agrees to pay the cost of any such physician's services, tests and
examinations.
(d) DEATH. If Employee dies during the Term, or Renewal Term,
if applicable, this Agreement shall terminate immediately, and the
Employee's legal representatives shall be entitled to receive the base
salary due the Employee through the last day of the calendar month in
which his death shall have occurred and any other death benefits
generally applicable to executive employees.
(e) NON-RENEWAL. If Employee's term of employment is not
renewed by Company as contemplated by Section 2 at the end of the
Term, Company shall pay to Employee the base salary due him through
the end of the Term, less applicable withholdings.
(f) CHANGE OF CONTROL. For purposes of this Agreement (except
to the extent governed or affected by Section 280G of the Internal
Revenue Code of 1986, as amended (the "Code")), "Change in Control"
shall be deemed to have occurred if the conditions set forth in any
one of the following paragraphs shall have been satisfied:
i) Any "person" (as such term is used in Section 13(d) and
14(d)) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act") or "persons" acting in concert, is or becomes the
"beneficial owner" (as defined in Rule 13d-3 under the Exchange
Act), directly or indirectly, of securities of the Company
representing twenty-five percent (25%) or more of the combined
voting power of Company's then outstanding securities, provided
that the term "person" for purposes of this Section 6(f)(i) shall
exclude Company or any trustee or other fiduciary holding
securities under an employee benefit plan of Company; or
ii) The stockholders of Company approve an acquisition
and/or merger or consolidation of Company with any other
corporation, other than (A) an acquisition and/or a merger or
consolidation which would result in the voting securities of
Company outstanding immediately prior thereto continuing to
represent (either by remaining outstanding or by being converted
into voting securities of the surviving entity), in combination
with the ownership of any trustee or other fiduciary holding
securities under an employee benefit plan of Company, at least
seventy percent (70%) of the combined voting power of the voting
securities of Company or such surviving entity outstanding
immediately after such merger or consolidation, or (B) an
acquisition and/or merger or consolidation effected to implement
a recapitalization of Company (or similar transaction) in which
no person acquires more than fifty percent (50%) of the combined
voting power of Company's then outstanding securities; or
4
<PAGE>
iii) The stockholders of Company approve a plan of complete
liquidation of Company or an agreement for the sale or
disposition by Company of all or substantially all Company's
assets.
(g) SEPARATION PAYMENT. i) For purposes of this
Agreement, "Separation Payment" means a payment equal
to 2.99 times the Employee's annual base salary at the
time of termination, subject to the limitations in
(6)(g)(ii), below.
ii) If the Separation Payment plus any other severance
benefits or any other payments or benefits received or to be
received by Employee from the Company (whether payable pursuant
to the terms of this Agreement or pursuant to any other plan,
agreement or arrangement with the Company or any corporation
("Affiliate") affiliated with the Company within the meaning of
Section 1504 of the Code (collectively, "Severance Benefits"), in
the opnion of tax counsel selected by the Company and acceptable
to Employee, constitute "parachute payments" within the meaning
of Section 280G (b)(2) of the Code, and the present value of such
"parachute payments" equals or exceeds three times the average of
the annual compensation payable to Employee by the Company (or an
Affiliate) and includable in Employee's gross income for federal
income tax purposes for the five years preceding the year in
which the Employee was terminated without cause under Section
6(b) of this Agreement (including, without limitation, a
termination without cause upon a Change of Control) ("Base
Amount"), if, but only if Employee so elects in writing, such
Severance Benefits shall be reduced to an amount the present
value of which (when combined with the present value of any other
payments or benefits otherwise received or to be received by
Employee from the Company or an Affiliate that are deemed
"parachute payments") is equal to 2.99 times the Base Amount,
notwithstanding any other provision to the contrary in this
Agreement. However, the Severance Benefits shall not be reduced
if in the opinion of such tax counsel, the Severance Benefits (in
their full amount or as partially reduced, as the case may be)
plus all other payments or benefits which constitute "parachute
payments" within the meaning of Section 280G (b)(2) of the Code
are reasonable compensation for services actually rendered,
within the meaning of Section 280G (b)(4) of the Code, and such
payments are deductible by the Company. The Base Amount shall
include every type and form of compensation includable in
Employee's gross income in respect of his employment by the
company (or an Affiliate), except to the extent otherwise
provided in temporary or final regulations promulgated under
Section 280G (b) of the Code. For purposes of this Section 6
(g)(ii), a "change in ownership or control" shall have the
meaning set forth in Section 280G (b) of the Code and any
temporary or final regulations promulgated thereunder. The
present value of any non-cash benefit or any deferred cash
payment shall be determined by the Company's independent auditors
in accordance with the principles of Sections 280G (d)(3) and (4)
of the Code.
iii) Employee shall have the right to request that the
Company obtain a ruling from the Internal Revenue Service
("Service") as to whether any or all payments or benefits
determined by such tax counsel are, in the view of the Service,
"parachute payments" under Section 280G. If a ruling is sought
pursuant to executive's request, no Severance Benefits payable
under this Agreement shall be made to Employee to the extent they
would exceed 2.99 times the Base Amount until after 15 days from
the date of such ruling. For purposes of this Section 6,
Employee
5
<PAGE>
and the Company agree to be bound by the Service's ruling as to
whether payments constitute "parachute payments" under Section
280G. If the Service declines, for any reason, to provide the
ruling requested, the tax counsel's opinion provided with respect
to what payments or benefits constitute "parachute payments"
shall control, and the period during which the excessive portion
of the Severance Benefits may be deferred shall be extended to a
date 15 days from the date of the Service's notice indicating
that no ruling would be forthcoming.
iv) If Section 280G, or any successor statute, is repealed,
this Section 6(g) shall cease to be effective on the effective of
such repeal. The parties to this Agreement recognize that final
regulations under Section 280G of the Code may affect the amounts
that may be paid under this Agreement and agree that, upon
issuance of such final regulations this Agreement may be modified
as in good faith deemed necessary in light of the provisions of
such regulations to achieve the purposes of this Agreement, and
that consent to such modifications shall not be unreasonably
withheld.
7. NON-COMPETITION; CONFIDENTIAL INFORMATION.
(a) CONFIDENTIAL INFORMATION. Employee acknowledges that
Employee may receive, or contribute to the production of, Confidential
Information. For purposes of this Agreement, Employee agrees that
"Confidential Information" shall mean information or material
proprietary to Company or designated as Confidential Information by
Company and not generally known by non-Company personnel, which
Employee develops or of or to which Employee may obtain knowledge or
access through or as a result of Employee's relationship with Company
(including information conceived, originated, discovered or developed
in whole or in part by Employee). Confidential Information includes,
but is not limited to, the following types of information and other
information of a similar nature (whether or not reduced to writing)
related to Company's business: discoveries, inventions, ideas,
concepts, research, development, processes, procedures, "know-how",
formulae, marketing techniques and materials, marketing and
development plans, business plans, customer names and other
information related to customers, price lists, pricing policies,
financial information, employee compensation, and computer programs
and systems. Confidential Information also includes any information
described above which Company obtains from another party and which
Company treats as proprietary or designates as Confidential
Information, whether or not owned by or developed by Company.
Employee acknowledges that the Confidential Information derives
independent economic value, actual or potential, from not being
generally known to, and not being readily ascertainable by proper
means by, other persons who can obtain economic value from its
disclosure or use. Information publicly known without breach of this
Agreement that is generally employed by the trade at or after the time
Employee first learns of such information, or generic information or
knowledge which Employee would have learned in the course of similar
employment or work elsewhere in the trade, shall not be deemed part of
the Confidential Information. Employee further agrees:
i) To furnish Company on demand, at any time during or
after employment, a complete list of the names and addresses of
all present, former and potential customers and other contacts
gained while an employee of Company in Employee's possession,
whether or not in the possession or within the knowledge of
Company;
6
<PAGE>
ii) that all notes, memoranda, documentation and records in
any way incorporating or reflecting any Confidential Information
shall belong exclusively to Company, and Employee agrees to turn
over all copies of such materials in Employee's control to
Company upon request or upon termination of Employee's employment
with Company;
iii) that while employed by Company and thereafter Employee
will hold in confidence and not directly or indirectly reveal,
report, publish, disclose or transfer any of the Confidential
Information to any person or entity, or utilize any of the
Confidential Information for any purpose, except in the course of
Employee's work for Company; and
iv) that any idea in whole or in part conceived of or made
by Employee during the term of his employment, consulting, or
similar relationship with Company which relates directly or
indirectly to Company's current or planned lines of business and
is made through the use of any of the Confidential Information of
Company or any of Company's equipment, facilities, trade secrets
or time, or which results from any work performed by Employee for
Company, shall belong exclusively to Company and shall be deemed
a part of the Confidential Information for purposes of this
Agreement. Employee hereby assigns and agrees to assign to
Company all rights in and to such Confidential Information
whether for purposes of obtaining patent or copyright protection
or otherwise. Employee shall acknowledge and deliver to Company,
without charge to Company (but at its expense) such written
instruments and do such other acts, including giving testimony in
support of Employee's authorship or inventorship, as the case may
be, necessary in the opinion of Company to obtain patents or
copyrights or to otherwise protect or vest in Company the entire
right and title in and to the Confidential Information.
(b) NON-COMPETITION. During the Term, Employee agrees that he
shall not enter into or engage, directly or indirectly, whether on his
own account or as a shareholder (other than as a less than 2%
shareholder of a publicly-held company), partner, joint venturer,
employee, consultant, advisor, and/or agent, of any person, firm,
corporation, or other entity, in any or all of the following
activities:
i) Engaging in Company Business in the United States;
ii) soliciting the past or existing customers, clients,
suppliers, or business patronage of Company or any of its
predecessors, affiliates or subsidiaries, or use any Confidential
Information (as defined in Section 7(a)) for the purpose of, or
which results in, competition with Company or any of its
affiliates or subsidiaries;
iii) soliciting the employment of any employees of Company
or any of its affiliates or subsidiaries; and
iv) promoting or assisting, financially or otherwise, any
person, firm, association, corporation, or other entity engaged
in the Company Business in the United States.
(c) INJUNCTIONS. It is agreed that the restrictions contained
in this Section 7 are reasonable, but it is recognized that damages in
the event of the breach of any of the restrictions will be difficult
or impossible to ascertain; and, therefore, Employee agrees that,
7
<PAGE>
in addition to and without limiting any other right or remedy Company
may have, Company shall have the right to an injunction against
Employee issued by a court of competent jurisdiction enjoining any
such breach without showing or proving any actual damage to Company.
(d) Employee also agrees, acknowledges, covenants, represents
and warrants as follows:
i) That he has read and fully understands the foregoing
restrictions and that he has consulted with a competent attorney
regarding the uses and enforceability of restrictive covenants;
ii) that he is aware that there may be defenses to the
enforceability of the foregoing restrictive covenants, based on
time or territory considerations, and that he knowingly,
consciously, intentionally and entirely voluntarily, irrevocably
waives any and all such defenses and will not assert the same in
any action or other proceeding brought by Company for the purpose
of enforcing the restrictive covenants or in any other action or
proceeding involving him and Company;
iii) that he is fully and completely aware that, and further
understands that, the foregoing restrictive covenants are an
essential part of the consideration for Company entering into
this Agreement and that Company is entering into this Agreement
in full reliance on these acknowledgments, covenants,
representations and warranties; and
iv) that the existence of any claim or cause of action by
him against Company, if any, whether predicated upon this
Agreement or otherwise, shall not constitute a defense to the
enforcement by Company of the foregoing restrictive covenants
which shall be litigated separately.
(e) If period of time and/or territory described above are
nevertheless held to be in any respect an unreasonable restriction
(after giving due consideration to the provisions of Section 7(d)
above), then it is agreed that the court so holding may reduce the
territory to which the restriction pertains or the period of time in
which it operates or may reduce both such territory and such period,
to the minimum extent necessary to render such provision enforceable.
(f) The obligations described in this Section 7 shall survive
any termination of this Agreement or any termination of the employment
relationship created hereunder for the maximum period of time said
obligations may be legally enforced.
8. INVENTIONS AND CREATIONS.
(a) Employee agrees that all inventions, discoveries,
developments, improvements, ideas, distinctive marks, symbols or
phrases, copyrightable creations, works of authorship, mask works and
other contributions including but not limited to software,
advertising, design, artwork, manuals and writings (collectively
referred to as "Creations"), whether or not protectable by statute,
which have been, or are in the future conceived, created, made,
developed or acquired by Employee, either individually or jointly,
while employee is retained by Company and relate in any manner to
Employee's work for Company, the research or business of Company or
fields into which the business of
8
<PAGE>
Company may extend, belong to Company. Employee hereby sells, assigns
and transfers to Company exclusively and irrevocably, without further
compensation, all ownership, title and rights in and to all of the
Creations. Employee further agrees to promptly and fully disclose the
Creations to Company in writing, if requested by Company, and to
execute and deliver any and all lawful applications, assignments and
other documents which Company requests for protecting the Creations in
the United States or any other country. Company shall have the full
and sole power to prosecute such applications and to take all other
actions concerning the Creations, and Employee agrees to cooperate
fully, at the expense of Company, in the preparation and prosecution
of all such applications and any legal actions and proceedings
concerning the Creations.
(b) Employee agrees and warrants that the Creations will be
Employee's original work and will not improperly or illegally
incorporate any material created by or belonging to others.
(c) Employee agrees to and does hereby sell, assign, convey and
transfer to Company any and all manuscripts, programs, writings,
pictorial materials, originals, camera-ready copies, and all drafts
and notes of the Creations, regardless of the media in which they
might exist, and to provide these materials to Company promptly
whenever requested by Company and upon completion of the Agreement,
and to execute documents, give testimony and otherwise cooperate fully
with Company to establish and/or confirm Company's ownership, patent,
copyright and/or trademark rights concerning the Creations.
(d) Without diminishing in any way the rights granted to Company
above, if a Creation is described in a patent, copyright or trademark
application, or is disclosed to a third party by Employee within two
(2) years after Employee's employment with Company is terminated,
Employee agrees that it is to be presumed that the Creation was
conceived, created, made, developed or acquired by Employee during the
period of his employment with Company, unless Employee can prove
otherwise by clear and convincing evidence.
9. GOVERNING LAW AND VENUE. Arizona law shall govern the
construction and enforcement of this Agreement and the parties agree that
any litigation pertaining to this Agreement shall be in courts located in
Maricopa County, Arizona.
10. CONSTRUCTION. The language in all parts of this Agreement shall
in all cases be construed as a whole according to its fair meaning and not
strictly for nor against any party. The Section headings contained in this
Agreement are for reference purposes only and will not affect in any way
the meaning or interpretation of this Agreement. All terms used in one
number or gender shall be construed to include any other number or gender
as the context may require. The parties agree that each party has reviewed
this Agreement and has had the opportunity to have counsel review the same
and that any rule of construction to the effect that ambiguities are to be
resolved against the drafting party shall not apply in the interpretation
of this Agreement or any amendment or any exhibits thereof.
11. NONDELEGABILITY OF EMPLOYEE'S RIGHTS AND COMPANY ASSIGNMENT
RIGHTS. The obligations, rights and benefits of Employee hereunder are
personal and may not be delegated, assigned or transferred in any manner
whatsoever, nor are such obligations, rights or benefits subject to
involuntary alienation, assignment or transfer. Upon reasonable notice to
Employee, Company may transfer Employee to an affiliate of Company, which
affiliate shall assume the obligations of Company under this Agreement.
This Agreement shall be assigned automatically to any entity merging with
or acquiring Company or its business.
9
<PAGE>
12. ASSIGNMENT. This Agreement and the respective rights, duties and
obligations of Employee hereunder may not be assigned or delegated by
Employee.
13. SEVERABILITY. In the event any term or provision of this
Agreement is declared by a court of competent jurisdiction to be invalid or
unenforceable for any reason, this Agreement shall remain in full force and
effect, and either (a) the invalid or unenforceable provision shall be
modified to the minimum extent necessary to make it valid and enforceable
or (b) if such a modification is not possible, this Agreement shall be
interpreted as if such invalid or unenforceable provision were not a part
hereof.
14. ATTORNEYS' FEES. Except as otherwise provided herein, in the
event any party hereto institutes an action or other proceeding to enforce
any rights arising out of this Agreement, the party prevailing in such
action or other proceeding shall be paid all reasonable costs and
attorneys' fees by the non-prevailing party, such fees to be set by the
court and not by a jury and to be included in any judgment entered in such
proceeding.
15. CONSIDERATION. It is expressly understood and agreed that this
document sets forth the entire consideration for this Agreement, and that
said consideration for this Agreement is contractual and not a mere
recital.
16. CONSTRUCTION. This Agreement is a negotiated agreement and any
documents delivered pursuant hereto shall be construed without regard to
the identity of the persons or entities who or which drafted the various
provisions thereof. Every provision of this Agreement and such other
employment-related documents shall be construed as though all parties
participated equally in the drafting thereof. Any legal rule of
construction that a document is to be construed against the drafting party
shall not be applicable and is expressly waived by Company and Employee.
17. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, all such counterparts shall be deemed to constitute one and
the same instrument, and each of said counterparts shall be deemed an
original hereof.
18. CAPTIONS. The captions used in this Agreement are inserted for
convenience only and shall not affect the meaning or construction of this
Agreement.
19. NOTICES. All notices required or permitted hereunder shall be
in writing and shall be deemed duly given upon receipt if either personally
delivered, sent by certified mail, return receipt requested, or sent by a
nationally-recognized overnight courier service, addressed to the parties
as follows:
If to Company: Renaissance Group International, Ltd.
------------- 7501 N. 16th Street, Suite 200
Phoenix, Arizona 85020
Attn: President
If to Employee: Kevin Jones
-------------- 9494 E. Redfield Rd. #2100
Scottsdale, AZ 85260
or to such other address as any party may provide to the other in
accordance with this Section.
10
<PAGE>
20. ENTIRE AGREEMENT. This Agreement constitutes the entire
agreement between the parties with respect to the subject matter hereof
(i.e., Employee's employment by Company) and supersedes all prior or
contemporaneous understandings or agreements in regard thereto; provided,
however, that (except as otherwise set forth herein) this Agreement shall
not affect or supersede any rights of Company under any other contracts or
other agreements between or otherwise involving the parties, any
restrictive covenants or any similar agreements. No modification or
addition to this Agreement shall be valid unless in writing, specifically
referring to this Agreement and signed by all parties hereto. No waiver of
any rights under this Agreement shall be valid unless in writing and signed
by the party to be charged with such waiver. No waiver of any term or
condition contained in this Agreement shall be deemed or construed as a
further or continuing waiver of such term or condition, unless the waiver
specifically provides otherwise.
IN WITNESS WHEREOF, the parties have executed this Agreement on the
1st day of February, 1998.
RENAISSANCE INTERNATIONAL GROUP, EMPLOYEE:
LTD, a Nevada corporation
By: /s/ TENNESSEE WEBB /s/ KEVIN JONES
-------------------------------- ----------------------------------
Its: President Kevin Jones
------------------------------
11
EXHIBIT 10(ii)
EMPLOYMENT AGREEMENT
THIS AGREEMENT (this "Agreement") is by and between RENAISSANCE
INTERNATIONAL GROUP, LTD., a Nevada corporation ("Company"), and PETER DE
KREY, an individual ("Employee").
RECITALS:
A. Company is engaged, among other things, in the business of
managing and operating medical facilities and developing digital interface
technology systems for the medical and related industries ("Company
Business"). Employee has substantial experience and expertise in the area
of international business affairs.
B. Company desires to retain the services of Employee as an
executive, to act as its VICE PRESIDENT OF INTERNATIONAL BUSINESS
DEVELOPMENT, and Employee desires and is willing to continue employment
with the Company in that capacity.
C. Company and Employee desire to embody the terms and conditions of
Employee's employment in a written agreement, which will supersede all
prior agreements of employment, whether written or oral, pursuant to the
terms and conditions hereinafter set forth.
D. The Board of Directors of Company (the "Board"), has determined
that it is in the best interests of Company and its shareholders to assure
that Company will have the continued dedication of Employee,
notwithstanding the possibility, threat or occurrence of a Change of
Control (as defined in Section 6(f)) of Company. The Board believes it is
imperative to diminish the inevitable distraction of Employee by virtue of
the personal uncertainties and risks created by a pending or threatened
Change of Control and to encourage Employee's full attention and dedication
to Company currently and in the event of any threatened or pending Change
of Control, and to provide Employee with compensation and benefits
arrangements upon a Change of Control which ensure that the compensation
and benefits expectations of Employee will be satisfied and which are
competitive with those of other corporations. Therefore, in order to
accomplish these objectives, the Board has caused Company to enter into
this Agreement.
AGREEMENT
In consideration of the recitals and mutual agreements hereinafter set
forth, the parties agree as follows:
1. EMPLOYMENT. Company agrees to continue to employ Employee on a
full-time basis, in accordance with the terms and conditions set forth
herein, and Employee agrees to accept such continued full-time employment
in accordance with said terms and conditions. Employee shall have such
duties and responsibilities as shall be allocated to him from time to time
by the Board in his capacity as the Vice President of International
Business Development. Employee's title and duties may be changed from time
to time in the discretion of Company's Board so long as he is maintained in
an executive capacity with duties, responsibilities and privileges
commensurate with his current level of employment. Employee agrees to
devote his full time, skill, knowledge and attention to the business of
Company and the performance of his duties under this Agreement. Employee
shall report directly to the President of Company.
2. TERM. The initial term (the "Term") of employment under this
Agreement shall commence on February 1, 1998 (the "Effective Date") and
shall continue for a period of five (5)
<PAGE>
years, unless earlier terminated as set forth in Section 6 below.
Thereafter, this Agreement shall automatically renew for an additional
three-year period (the "Renewal Term") unless either party gives the other
written notice of non-renewal at least 30 days prior to the expiration of
the Term or Renewal Term.
3. COMPENSATION.
(a) BASE SALARY. Company agrees to pay Employee an initial
annual base salary of $150,300, before deducting all applicable
withholdings which shall be payable in accordance with Company's
standard executive payroll policies as they may be revised from time
to time. Employee's annual base salary shall thereafter be subject to
annual adjustment in accordance with Company's standard executive
compensation policies, but in no event shall Employee's annual base
salary be less than $150,300 per year during the Term or Renewal Term.
(b) INCENTIVE BONUS. After commencing his duties as Vice
President of International Business Development, Company's Executive
Committee shall, at its option, design and present to the Board for
review, adjustment and adoption, an incentive compensation program for
key employees. Employee shall be designated as a key employee and
shall be entitled to participate in such program, and if financial
targets established pursuant to the program are met, will be eligible
to earn in any year an additional maximum amount of compensation in
the form of stock, stock options and/or cash as determined by
Company's Executive Committee.
(c) DEDUCTIONS. Company shall deduct from the payments made to
Employee hereunder any federal, state or local withholding or other
taxes or charges which Company is required to deduct under applicable
law, and all amounts payable to Employee under this Agreement are
stated before any such deductions. Company shall have the right to
rely upon written opinion of counsel if any questions arise as to any
deductions.
4. BENEFITS.
2
<PAGE>
(a) INSURANCE. In addition to the compensation described above,
while Employee is employed hereunder, Company shall pay for and
provide Employee and his dependents with the same amount and type of
health, medical and life insurance as is provided from time to time to
executive officers of Company during the Term and Renewal Term, if
applicable.
(b) EXPENSE REIMBURSEMENT. In addition to the compensation and
benefits provided above, Company shall, upon prior approval of the
Executive Committee and receipt of appropriate documentation,
reimburse Employee each month for his reasonable travel, lodging and
other ordinary and necessary business expenses consistent with
Company's policies as in effect from time to time.
(c) RETIREMENT PLAN. In addition to the compensation and
benefits provided above, Company shall pay for and provide Employee a
retirement or pension plan as is provided from time to time to
executive officers of Company during the Term and Renewal Term, if
applicable.
5. VACATION. Employee shall be entitled to vacation with pay in
accordance with Company's vacation policy as in effect from time to time.
In addition, Employee shall be entitled to such holidays as Company may
approve for its executive personnel.
6. TERMINATION. The Board may terminate Employee's employment by
Company prior to the expiration of the Term or Renewal Term in the manner
provided in either Section 6(a) or Section 6(b). Additionally, if notice
of non-renewal is given pursuant to Section 2, the term of employment shall
expire at the end of the Term and Employee shall be entitled to
compensation as provided in Section 6(e).
(a) FOR CAUSE. Company may terminate this Agreement for cause
upon written notice to the Employee stating the facts constituting
such cause, provided that Employee shall have 10 days following such
notice to cure any conduct or act, if curable, alleged to provide
grounds for termination for cause hereunder. In the event of
termination for cause, any unexercised stock options granted pursuant
to Section 3(c) shall automatically expire, and Company shall be
obligated to pay Employee only the salary due him through the date of
termination pursuant to Section 3(a). Cause shall include material
neglect of duties, failure to abide by ethical and good faith
instructions or policies from or set by the Board, conviction of a
felony or serious misdemeanor offense or pleading guilty or NOLO
CONTENDERE to same, the commission by Employee of an act of dishonesty
or moral turpitude, Employee's breach of this Agreement, breach by
Employee of any other material obligation to Company, or upon the
bankruptcy, receivership, dissolution or cessation of business of
Company.
(b) WITHOUT CAUSE. Any termination of Employee by Company for
any other reason than for cause shall constitute a termination without
cause. Any termination resulting from a Change of Control as defined
below shall constitute a termination without cause without the
necessity of written notice to Employee. Upon termination under this
Section 6(b), Company shall (i) pay to Employee his base salary at the
time of termination due him through the date of the expiration of the
Term, or Renewal Term, if applicable; and (ii) within 60 days after
the end of the fiscal year in which termination pursuant to this
Section 6(b) occurs, Employee shall be entitled to receive a
separation payment as defined below.
(c) DISABILITY. If during the Term, or Renewal Term, if
applicable, Employee fails to perform his duties hereunder because of
physical or mental illness or other incapacity for a period of two
consecutive months, or for 45 days during any 120-day period, Company
3
<PAGE>
shall have the right to terminate this Agreement without further
obligation hereunder except for any bonus amount payable in accordance
with this Section 6(c) and any amounts payable pursuant to disability
plans generally applicable to executive employees. Company shall
provide Employee with notice of commencement of the disability period,
which period cannot commence more than seven (7) days prior to the
date of the notice. If there is any dispute as to whether Employee is
or was physically or mentally disabled under this Agreement, or
whether his disability has ceased and he is able to resume his duties,
such question shall be submitted to a licensed physician agreed upon
by the parties. Employee shall submit to such examinations and
provide information as such physician may request, and the
determination of such physician as to Employee's physical or mental
condition shall be binding and conclusive on the parties. Company
agrees to pay the cost of any such physician's services, tests and
examinations.
(d) DEATH. If Employee dies during the Term, or Renewal Term,
if applicable, this Agreement shall terminate immediately, and the
Employee's legal representatives shall be entitled to receive the base
salary due the Employee through the last day of the calendar month in
which his death shall have occurred and any other death benefits
generally applicable to executive employees.
(e) NON-RENEWAL. If Employee's term of employment is not
renewed by Company as contemplated by Section 2 at the end of the
Term, Company shall pay to Employee the base salary due him through
the end of the Term, less applicable withholdings.
(f) CHANGE OF CONTROL. For purposes of this Agreement (except
to the extent governed or affected by Section 280G of the Internal
Revenue Code of 1986, as amended (the "Code")), "Change in Control"
shall be deemed to have occurred if the conditions set forth in any
one of the following paragraphs shall have been satisfied:
i) Any "person" (as such term is used in Section 13(d) and
14(d)) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act") or "persons" acting in concert, is or becomes the
"beneficial owner" (as defined in Rule 13d-3 under the Exchange
Act), directly or indirectly, of securities of the Company
representing twenty-five percent (25%) or more of the combined
voting power of Company's then outstanding securities, provided
that the term "person" for purposes of this Section 6(f)(i) shall
exclude Company or any trustee or other fiduciary holding
securities under an employee benefit plan of Company; or
ii) The stockholders of Company approve an acquisition
and/or merger or consolidation of Company with any other
corporation, other than (A) an acquisition and/or a merger or
consolidation which would result in the voting securities of
Company outstanding immediately prior thereto continuing to
represent (either by remaining outstanding or by being converted
into voting securities of the surviving entity), in combination
with the ownership of any trustee or other fiduciary holding
securities under an employee benefit plan of Company, at least
seventy percent (70%) of the combined voting power of the voting
securities of Company or such surviving entity outstanding
immediately after such merger or consolidation, or (B) an
acquisition and/or merger or consolidation effected to implement
a recapitalization of Company (or similar transaction) in which
no person acquires more than fifty percent (50%) of the combined
voting power of Company's then outstanding securities; or
4
<PAGE>
iii) The stockholders of Company approve a plan of complete
liquidation of Company or an agreement for the sale or
disposition by Company of all or substantially all Company's
assets.
(g) SEPARATION PAYMENT. i) For purposes of this Agreement,
"Separation Payment" means a payment equal to 2.99 times the
Employee's annual base salary at the time of termination,
subject to the limitations in (6)(g)(ii), below.
ii) If the Separation Payment plus any other severance
benefits or any other payments or benefits received or to be
received by Employee from the Company (whether payable pursuant
to the terms of this Agreement or pursuant to any other plan,
agreement or arrangement with the Company or any corporation
("Affiliate") affiliated with the Company within the meaning of
Section 1504 of the Code (collectively, "Severance Benefits"), in
the opnion of tax counsel selected by the Company and acceptable
to Employee, constitute "parachute payments" within the meaning
of Section 280G (b)(2) of the Code, and the present value of such
"parachute payments" equals or exceeds three times the average of
the annual compensation payable to Employee by the Company (or an
Affiliate) and includable in Employee's gross income for federal
income tax purposes for the five years preceding the year in
which the Employee was terminated without cause under Section
6(b) of this Agreement (including, without limitation, a
termination without cause upon a Change of Control) ("Base
Amount"), if, but only if Employee so elects in writing, such
Severance Benefits shall be reduced to an amount the present
value of which (when combined with the present value of any other
payments or benefits otherwise received or to be received by
Employee from the Company or an Affiliate that are deemed
"parachute payments") is equal to 2.99 times the Base Amount,
notwithstanding any other provision to the contrary in this
Agreement. However, the Severance Benefits shall not be reduced
if in the opinion of such tax counsel, the Severance Benefits (in
their full amount or as partially reduced, as the case may be)
plus all other payments or benefits which constitute "parachute
payments" within the meaning of Section 280G (b)(2) of the Code
are reasonable compensation for services actually rendered,
within the meaning of Section 280G (b)(4) of the Code, and such
payments are deductible by the Company. The Base Amount shall
include every type and form of compensation includable in
Employee's gross income in respect of his employment by the
company (or an Affiliate), except to the extent otherwise
provided in temporary or final regulations promulgated under
Section 280G (b) of the Code. For purposes of this Section 6
(g)(ii), a "change in ownership or control" shall have the
meaning set forth in Section 280G (b) of the Code and any
temporary or final regulations promulgated thereunder. The
present value of any non-cash benefit or any deferred cash
payment shall be determined by the Company's independent auditors
in accordance with the principles of Sections 280G (d)(3) and (4)
of the Code.
iii) Employee shall have the right to request that the
Company obtain a ruling from the Internal Revenue Service
("Service") as to whether any or all payments or benefits
determined by such tax counsel are, in the view of the Service,
"parachute payments" under Section 280G. If a ruling is sought
pursuant to executive's request, no Severance Benefits payable
under this Agreement shall be made to Employee to the extent they
would exceed 2.99 times the Base Amount until after 15 days from
the date of such ruling. For purposes of this Section 6,
Employee
5
<PAGE>
and the Company agree to be bound by the Service's ruling as to
whether payments constitute "parachute payments" under Section
280G. If the Service declines, for any reason, to provide the
ruling requested, the tax counsel's opinion provided with respect
to what payments or benefits constitute "parachute payments"
shall control, and the period during which the excessive portion
of the Severance Benefits may be deferred shall be extended to a
date 15 days from the date of the Service's notice indicating
that no ruling would be forthcoming.
iv) If Section 280G, or any successor statute, is repealed,
this Section 6(g) shall cease to be effective on the effective of
such repeal. The parties to this Agreement recognize that final
regulations under Section 280G of the Code may affect the amounts
that may be paid under this Agreement and agree that, upon
issuance of such final regulations this Agreement may be modified
as in good faith deemed necessary in light of the provisions of
such regulations to achieve the purposes of this Agreement, and
that consent to such modifications shall not be unreasonably
withheld.
7. NON-COMPETITION; CONFIDENTIAL INFORMATION.
(a) CONFIDENTIAL INFORMATION. Employee acknowledges that
Employee may receive, or contribute to the production of, Confidential
Information. For purposes of this Agreement, Employee agrees that
"Confidential Information" shall mean information or material
proprietary to Company or designated as Confidential Information by
Company and not generally known by non-Company personnel, which
Employee develops or of or to which Employee may obtain knowledge or
access through or as a result of Employee's relationship with Company
(including information conceived, originated, discovered or developed
in whole or in part by Employee). Confidential Information includes,
but is not limited to, the following types of information and other
information of a similar nature (whether or not reduced to writing)
related to Company's business: discoveries, inventions, ideas,
concepts, research, development, processes, procedures, "know-how",
formulae, marketing techniques and materials, marketing and
development plans, business plans, customer names and other
information related to customers, price lists, pricing policies,
financial information, employee compensation, and computer programs
and systems. Confidential Information also includes any information
described above which Company obtains from another party and which
Company treats as proprietary or designates as Confidential
Information, whether or not owned by or developed by Company.
Employee acknowledges that the Confidential Information derives
independent economic value, actual or potential, from not being
generally known to, and not being readily ascertainable by proper
means by, other persons who can obtain economic value from its
disclosure or use. Information publicly known without breach of this
Agreement that is generally employed by the trade at or after the time
Employee first learns of such information, or generic information or
knowledge which Employee would have learned in the course of similar
employment or work elsewhere in the trade, shall not be deemed part of
the Confidential Information. Employee further agrees:
i) To furnish Company on demand, at any time during or
after employment, a complete list of the names and addresses of
all present, former and potential customers and other contacts
gained while an employee of Company in Employee's possession,
whether or not in the possession or within the knowledge of
Company;
6
<PAGE>
ii) that all notes, memoranda, documentation and records in
any way incorporating or reflecting any Confidential Information
shall belong exclusively to Company, and Employee agrees to turn
over all copies of such materials in Employee's control to
Company upon request or upon termination of Employee's employment
with Company;
iii) that while employed by Company and thereafter Employee
will hold in confidence and not directly or indirectly reveal,
report, publish, disclose or transfer any of the Confidential
Information to any person or entity, or utilize any of the
Confidential Information for any purpose, except in the course of
Employee's work for Company; and
iv) that any idea in whole or in part conceived of or made
by Employee during the term of his employment, consulting, or
similar relationship with Company which relates directly or
indirectly to Company's current or planned lines of business and
is made through the use of any of the Confidential Information of
Company or any of Company's equipment, facilities, trade secrets
or time, or which results from any work performed by Employee for
Company, shall belong exclusively to Company and shall be deemed
a part of the Confidential Information for purposes of this
Agreement. Employee hereby assigns and agrees to assign to
Company all rights in and to such Confidential Information
whether for purposes of obtaining patent or copyright protection
or otherwise. Employee shall acknowledge and deliver to Company,
without charge to Company (but at its expense) such written
instruments and do such other acts, including giving testimony in
support of Employee's authorship or inventorship, as the case may
be, necessary in the opinion of Company to obtain patents or
copyrights or to otherwise protect or vest in Company the entire
right and title in and to the Confidential Information.
(b) NON-COMPETITION. During the Term, Employee agrees that he
shall not enter into or engage, directly or indirectly, whether on his
own account or as a shareholder (other than as a less than 2%
shareholder of a publicly-held company), partner, joint venturer,
employee, consultant, advisor, and/or agent, of any person, firm,
corporation, or other entity, in any or all of the following
activities:
i) Engaging in Company Business in the United States;
ii) soliciting the past or existing customers, clients,
suppliers, or business patronage of Company or any of its
predecessors, affiliates or subsidiaries, or use any Confidential
Information (as defined in Section 7(a)) for the purpose of, or
which results in, competition with Company or any of its
affiliates or subsidiaries;
iii) soliciting the employment of any employees of Company
or any of its affiliates or subsidiaries; and
iv) promoting or assisting, financially or otherwise, any
person, firm, association, corporation, or other entity engaged
in the Company Business in the United States.
(c) INJUNCTIONS. It is agreed that the restrictions contained
in this Section 7 are reasonable, but it is recognized that damages in
the event of the breach of any of the restrictions will be difficult
or impossible to ascertain; and, therefore, Employee agrees that,
7
<PAGE>
in addition to and without limiting any other right or remedy Company
may have, Company shall have the right to an injunction against
Employee issued by a court of competent jurisdiction enjoining any
such breach without showing or proving any actual damage to Company.
(d) Employee also agrees, acknowledges, covenants, represents
and warrants as follows:
i) That he has read and fully understands the foregoing
restrictions and that he has consulted with a competent attorney
regarding the uses and enforceability of restrictive covenants;
ii) that he is aware that there may be defenses to the
enforceability of the foregoing restrictive covenants, based on
time or territory considerations, and that he knowingly,
consciously, intentionally and entirely voluntarily, irrevocably
waives any and all such defenses and will not assert the same in
any action or other proceeding brought by Company for the purpose
of enforcing the restrictive covenants or in any other action or
proceeding involving him and Company;
iii) that he is fully and completely aware that, and further
understands that, the foregoing restrictive covenants are an
essential part of the consideration for Company entering into
this Agreement and that Company is entering into this Agreement
in full reliance on these acknowledgments, covenants,
representations and warranties; and
iv) that the existence of any claim or cause of action by
him against Company, if any, whether predicated upon this
Agreement or otherwise, shall not constitute a defense to the
enforcement by Company of the foregoing restrictive covenants
which shall be litigated separately.
(e) If period of time and/or territory described above are
nevertheless held to be in any respect an unreasonable restriction
(after giving due consideration to the provisions of Section 7(d)
above), then it is agreed that the court so holding may reduce the
territory to which the restriction pertains or the period of time in
which it operates or may reduce both such territory and such period,
to the minimum extent necessary to render such provision enforceable.
(f) The obligations described in this Section 7 shall survive
any termination of this Agreement or any termination of the employment
relationship created hereunder for the maximum period of time said
obligations may be legally enforced.
8. INVENTIONS AND CREATIONS.
(a) Employee agrees that all inventions, discoveries,
developments, improvements, ideas, distinctive marks, symbols or
phrases, copyrightable creations, works of authorship, mask works and
other contributions including but not limited to software,
advertising, design, artwork, manuals and writings (collectively
referred to as "Creations"), whether or not protectable by statute,
which have been, or are in the future conceived, created, made,
developed or acquired by Employee, either individually or jointly,
while employee is retained by Company and relate in any manner to
Employee's work for Company, the research or business of Company or
fields into which the business of
8
<PAGE>
Company may extend, belong to Company. Employee hereby sells, assigns
and transfers to Company exclusively and irrevocably, without further
compensation, all ownership, title and rights in and to all of the
Creations. Employee further agrees to promptly and fully disclose the
Creations to Company in writing, if requested by Company, and to
execute and deliver any and all lawful applications, assignments and
other documents which Company requests for protecting the Creations in
the United States or any other country. Company shall have the full
and sole power to prosecute such applications and to take all other
actions concerning the Creations, and Employee agrees to cooperate
fully, at the expense of Company, in the preparation and prosecution
of all such applications and any legal actions and proceedings
concerning the Creations.
(b) Employee agrees and warrants that the Creations will be
Employee's original work and will not improperly or illegally
incorporate any material created by or belonging to others.
(c) Employee agrees to and does hereby sell, assign, convey and
transfer to Company any and all manuscripts, programs, writings,
pictorial materials, originals, camera-ready copies, and all drafts
and notes of the Creations, regardless of the media in which they
might exist, and to provide these materials to Company promptly
whenever requested by Company and upon completion of the Agreement,
and to execute documents, give testimony and otherwise cooperate fully
with Company to establish and/or confirm Company's ownership, patent,
copyright and/or trademark rights concerning the Creations.
(d) Without diminishing in any way the rights granted to Company
above, if a Creation is described in a patent, copyright or trademark
application, or is disclosed to a third party by Employee within two
(2) years after Employee's employment with Company is terminated,
Employee agrees that it is to be presumed that the Creation was
conceived, created, made, developed or acquired by Employee during the
period of his employment with Company, unless Employee can prove
otherwise by clear and convincing evidence.
9. GOVERNING LAW AND VENUE. Arizona law shall govern the
construction and enforcement of this Agreement and the parties agree that
any litigation pertaining to this Agreement shall be in courts located in
Maricopa County, Arizona.
10. CONSTRUCTION. The language in all parts of this Agreement shall
in all cases be construed as a whole according to its fair meaning and not
strictly for nor against any party. The Section headings contained in this
Agreement are for reference purposes only and will not affect in any way
the meaning or interpretation of this Agreement. All terms used in one
number or gender shall be construed to include any other number or gender
as the context may require. The parties agree that each party has reviewed
this Agreement and has had the opportunity to have counsel review the same
and that any rule of construction to the effect that ambiguities are to be
resolved against the drafting party shall not apply in the interpretation
of this Agreement or any amendment or any exhibits thereof.
11. NONDELEGABILITY OF EMPLOYEE'S RIGHTS AND COMPANY ASSIGNMENT
RIGHTS. The obligations, rights and benefits of Employee hereunder are
personal and may not be delegated, assigned or transferred in any manner
whatsoever, nor are such obligations, rights or benefits subject to
involuntary alienation, assignment or transfer. Upon reasonable notice to
Employee, Company may transfer Employee to an affiliate of Company, which
affiliate shall assume the obligations of Company under this Agreement.
This Agreement shall be assigned automatically to any entity merging with
or acquiring Company or its business.
9
<PAGE>
12. ASSIGNMENT. This Agreement and the respective rights, duties and
obligations of Employee hereunder may not be assigned or delegated by
Employee.
13. SEVERABILITY. In the event any term or provision of this
Agreement is declared by a court of competent jurisdiction to be invalid or
unenforceable for any reason, this Agreement shall remain in full force and
effect, and either (a) the invalid or unenforceable provision shall be
modified to the minimum extent necessary to make it valid and enforceable
or (b) if such a modification is not possible, this Agreement shall be
interpreted as if such invalid or unenforceable provision were not a part
hereof.
14. ATTORNEYS' FEES. Except as otherwise provided herein, in the
event any party hereto institutes an action or other proceeding to enforce
any rights arising out of this Agreement, the party prevailing in such
action or other proceeding shall be paid all reasonable costs and
attorneys' fees by the non-prevailing party, such fees to be set by the
court and not by a jury and to be included in any judgment entered in such
proceeding.
15. CONSIDERATION. It is expressly understood and agreed that this
document sets forth the entire consideration for this Agreement, and that
said consideration for this Agreement is contractual and not a mere
recital.
16. CONSTRUCTION. This Agreement is a negotiated agreement and any
documents delivered pursuant hereto shall be construed without regard to
the identity of the persons or entities who or which drafted the various
provisions thereof. Every provision of this Agreement and such other
employment-related documents shall be construed as though all parties
participated equally in the drafting thereof. Any legal rule of
construction that a document is to be construed against the drafting party
shall not be applicable and is expressly waived by Company and Employee.
17. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, all such counterparts shall be deemed to constitute one and
the same instrument, and each of said counterparts shall be deemed an
original hereof.
18. CAPTIONS. The captions used in this Agreement are inserted for
convenience only and shall not affect the meaning or construction of this
Agreement.
19. NOTICES. All notices required or permitted hereunder shall be
in writing and shall be deemed duly given upon receipt if either personally
delivered, sent by certified mail, return receipt requested, or sent by a
nationally-recognized overnight courier service, addressed to the parties
as follows:
If to Company: Renaissance Group International, Ltd.
------------- 7501 N. 16th Street, Suite 200
Phoenix, Arizona 85020
Attn: President
If to Employee: Peter de Krey
-------------- 2124 W. Shawnee Dr.
Chandler, AZ 85224
or to such other address as any party may provide to the other in
accordance with this Section.
10
<PAGE>
20. ENTIRE AGREEMENT. This Agreement constitutes the entire
agreement between the parties with respect to the subject matter hereof
(i.e., Employee's employment by Company) and supersedes all prior or
contemporaneous understandings or agreements in regard thereto; provided,
however, that (except as otherwise set forth herein) this Agreement shall
not affect or supersede any rights of Company under any other contracts or
other agreements between or otherwise involving the parties, any
restrictive covenants or any similar agreements. No modification or
addition to this Agreement shall be valid unless in writing, specifically
referring to this Agreement and signed by all parties hereto. No waiver of
any rights under this Agreement shall be valid unless in writing and signed
by the party to be charged with such waiver. No waiver of any term or
condition contained in this Agreement shall be deemed or construed as a
further or continuing waiver of such term or condition, unless the waiver
specifically provides otherwise.
IN WITNESS WHEREOF, the parties have executed this Agreement on the
1st day of February, 1998.
RENAISSANCE INTERNATIONAL GROUP, EMPLOYEE:
LTD, a Nevada corporation
By: /s/ TENNESSEE WEBB /s/ PETER DE KREY
--------------------------------- ---------------------------------
Its: President Peter de Krey
-------------------------------
11
EXHIBIT 10(iii)
EMPLOYMENT AGREEMENT
THIS AGREEMENT (this "Agreement") is by and between RENAISSANCE
INTERNATIONAL GROUP, LTD., a Nevada corporation ("Company"), and JAMES
JONES, an individual ("Employee").
RECITALS:
A. Company is engaged, among other things, in the business of
managing and operating medical facilities and developing digital interface
technology systems for the medical and related industries ("Company
Business"). Employee has substantial experience and expertise in the area
of investor relations.
B. Company desires to retain the services of Employee as an
executive, to act as its VICE PRESIDENT OF INVESTOR RELATIONS, and Employee
desires and is willing to continue employment with the Company in that
capacity.
C. Company and Employee desire to embody the terms and conditions of
Employee's employment in a written agreement, which will supersede all
prior agreements of employment, whether written or oral, pursuant to the
terms and conditions hereinafter set forth.
D. The Board of Directors of Company (the "Board"), has determined
that it is in the best interests of Company and its shareholders to assure
that Company will have the continued dedication of Employee,
notwithstanding the possibility, threat or occurrence of a Change of
Control (as defined in Section 6(f)) of Company. The Board believes it is
imperative to diminish the inevitable distraction of Employee by virtue of
the personal uncertainties and risks created by a pending or threatened
Change of Control and to encourage Employee's full attention and dedication
to Company currently and in the event of any threatened or pending Change
of Control, and to provide Employee with compensation and benefits
arrangements upon a Change of Control which ensure that the compensation
and benefits expectations of Employee will be satisfied and which are
competitive with those of other corporations. Therefore, in order to
accomplish these objectives, the Board has caused Company to enter into
this Agreement.
AGREEMENT
In consideration of the recitals and mutual agreements hereinafter set
forth, the parties agree as follows:
1. EMPLOYMENT. Company agrees to continue to employ Employee on a
full-time basis, in accordance with the terms and conditions set forth
herein, and Employee agrees to accept such continued full-time employment
in accordance with said terms and conditions. Employee shall have such
duties and responsibilities as shall be allocated to him from time to time
by the Board in his capacity as the Vice President of Investor Relations.
Employee's title and duties may be changed from time to time in the
discretion of Company's Board so long as he is maintained in an executive
capacity with duties, responsibilities and privileges commensurate with his
current level of employment. Employee agrees to devote his full time,
skill, knowledge and attention to the business of Company and the
performance of his duties under this Agreement. Employee shall report
directly to the President of Company.
2. TERM. The initial term (the "Term") of employment under this
Agreement shall commence on February 1, 1998 (the "Effective Date") and
shall continue for a period of five (5)
<PAGE>
years, unless earlier terminated as set forth in Section 6 below.
Thereafter, this Agreement shall automatically renew for an additional
three-year period (the "Renewal Term") unless either party gives the other
written notice of non-renewal at least 30 days prior to the expiration of
the Term or Renewal Term.
3. COMPENSATION.
(a) BASE SALARY. Company agrees to pay Employee an initial
annual base salary of $120,000, before deducting all applicable
withholdings which shall be payable in accordance with Company's
standard executive payroll policies as they may be revised from time
to time. Employee's annual base salary shall thereafter be subject to
adjustment in accordance with Company's standard executive
compensation policies, but in no event shall Employee's annual base
salary be less than $120,000 per year during the Term or Renewal Term.
(b) INCENTIVE BONUS. After commencing his duties as Vice
President of Investor Relations, Company's Executive Committee shall,
at its option, design and present to the Board for review, adjustment
and adoption, an incentive compensation program for key employees.
Employee shall be designated as a key employee and shall be entitled
to participate in such program, and if financial targets established
pursuant to the program are met, will be eligible to earn in any year
an additional maximum amount of compensation in the form of stock,
stock options and/or cash as determined by Company's Executive
Committee.
(c) DEDUCTIONS. Company shall deduct from the payments made to
Employee hereunder any federal, state or local withholding or other
taxes or charges which Company is required to deduct under applicable
law, and all amounts payable to Employee under this Agreement are
stated before any such deductions. Company shall have the right to
rely upon written opinion of counsel if any questions arise as to any
deductions.
4. BENEFITS.
2
<PAGE>
(a) INSURANCE. In addition to the compensation described above,
while Employee is employed hereunder, Company shall pay for and
provide Employee and his dependents with the same amount and type of
health, medical and life insurance as is provided from time to time to
executive officers of Company during the Term and Renewal Term, if
applicable.
(b) EXPENSE REIMBURSEMENT. In addition to the compensation and
benefits provided above, Company shall, upon prior approval of the
Executive Committee and receipt of appropriate documentation,
reimburse Employee each month for his reasonable travel, lodging and
other ordinary and necessary business expenses consistent with
Company's policies as in effect from time to time.
(c) RETIREMENT PLAN. In addition to the compensation and
benefits provided above, Company shall pay for and provide Employee a
retirement or pension plan as is provided from time to time to
executive officers of Company during the Term and Renewal Term, if
applicable.
5. VACATION. Employee shall be entitled to vacation with pay in
accordance with Company's vacation policy as in effect from time to time.
In addition, Employee shall be entitled to such holidays as Company may
approve for its executive personnel.
6. TERMINATION. The Board may terminate Employee's employment by
Company prior to the expiration of the Term or Renewal Term in the manner
provided in either Section 6(a) or Section 6(b). Additionally, if notice
of non-renewal is given pursuant to Section 2, the term of employment shall
expire at the end of the Term and Employee shall be entitled to
compensation as provided in Section 6(e).
(a) FOR CAUSE. Company may terminate this Agreement for cause
upon written notice to the Employee stating the facts constituting
such cause, provided that Employee shall have 10 days following such
notice to cure any conduct or act, if curable, alleged to provide
grounds for termination for cause hereunder. In the event of
termination for cause, any unexercised stock options granted pursuant
to Section 3(c) shall automatically expire, and Company shall be
obligated to pay Employee only the salary due him through the date of
termination pursuant to Section 3(a). Cause shall include material
neglect of duties, failure to abide by ethical and good faith
instructions or policies from or set by the Board, conviction of a
felony or serious misdemeanor offense or pleading guilty or NOLO
CONTENDERE to same, the commission by Employee of an act of dishonesty
or moral turpitude, Employee's breach of this Agreement, breach by
Employee of any other material obligation to Company, or upon the
bankruptcy, receivership, dissolution or cessation of business of
Company.
(b) WITHOUT CAUSE. Any termination of Employee by Company for
any other reason than for cause shall constitute a termination without
cause. Any termination resulting from a Change of Control as defined
below shall constitute a termination without cause without the
necessity of written notice to Employee. Upon termination under this
Section 6(b), Company shall (i) pay to Employee his base salary at the
time of termination due him through the date of the expiration of the
Term, or Renewal Term, if applicable; and (ii) within 60 days after
the end of the fiscal year in which termination pursuant to this
Section 6(b) occurs, Employee shall be entitled to receive a
separation payment as defined below.
(c) DISABILITY. If during the Term, or Renewal Term, if
applicable, Employee fails to perform his duties hereunder because of
physical or mental illness or other incapacity for a period of two
consecutive months, or for 45 days during any 120-day period, Company
3
<PAGE>
shall have the right to terminate this Agreement without further obligation
hereunder except for any bonus amount payable in accordance with this
Section 6(c) and any amounts payable pursuant to disability plans generally
applicable to executive employees. Company shall provide Employee with
notice of commencement of the disability period, which period cannot
commence more than seven (7) days prior to the date of the notice. If
there is any dispute as to whether Employee is or was physically or
mentally disabled under this Agreement, or whether his disability has
ceased and he is able to resume his duties, such question shall be
submitted to a licensed physician agreed upon by the parties. Employee
shall submit to such examinations and provide information as such physician
may request, and the determination of such physician as to Employee's
physical or mental condition shall be binding and conclusive on the
parties. Company agrees to pay the cost of any such physician's services,
tests and examinations.
(d) DEATH. If Employee dies during the Term, or Renewal Term,
if applicable, this Agreement shall terminate immediately, and the
Employee's legal representatives shall be entitled to receive the base
salary due the Employee through the last day of the calendar month in
which his death shall have occurred and any other death benefits
generally applicable to executive employees.
(e) NON-RENEWAL. IF Employee's term of employment is not
renewed by Company as contemplated by Section 2 at the end of the
Term, Company shall pay to Employee the base salary due him through
the end of the Term, less applicable withholdings.
(f) CHANGE OF CONTROL. For purposes of this Agreement (except
to the extent governed or affected by Section 280G of the Internal
Revenue Code of 1986, as amended (the "Code")), "Change in Control"
shall be deemed to have occurred if the conditions set forth in any
one of the following paragraphs shall have been satisfied:
i) Any "person" (as such term is used in Section 13(d) and
14(d)) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act") or "persons" acting in concert, is or becomes the
"beneficial owner" (as defined in Rule 13d-3 under the Exchange
Act), directly or indirectly, of securities of the Company
representing twenty-five percent (25%) or more of the combined
voting power of Company's then outstanding securities, provided
that the term "person" for purposes of this Section 6(f)(i) shall
exclude Company or any trustee or other fiduciary holding
securities under an employee benefit plan of Company; or
ii) The stockholders of Company approve an acquisition
and/or merger or consolidation of Company with any other
corporation, other than (A) an acquisition and/or a merger or
consolidation which would result in the voting securities of
Company outstanding immediately prior thereto continuing to
represent (either by remaining outstanding or by being converted
into voting securities of the surviving entity), in combination
with the ownership of any trustee or other fiduciary holding
securities under an employee benefit plan of Company, at least
seventy percent (70%) of the combined voting power of the voting
securities of Company or such surviving entity outstanding
immediately after such merger or consolidation, or (B) an
acquisition and/or merger or consolidation effected to implement
a recapitalization of Company (or similar transaction) in which
no person acquires more than fifty percent (50%) of the combined
voting power of Company's then outstanding securities; or
4
<PAGE>
iii) The stockholders of Company approve a plan of complete
liquidation of Company or an agreement for the sale or
disposition by Company of all or substantially all Company's
assets.
(g) SEPARATION PAYMENT. i) For purposes of this Agreement,
"Separation Payment" means a payment equal to 2.99 times the
Employee's annual base salary at the time of termination,
subject to the limitations in (6)(g)(ii), below.
ii) If the Separation Payment plus any other severance
benefits or any other payments or benefits received or to be
received by Employee from the Company (whether payable pursuant
to the terms of this Agreement or pursuant to any other plan,
agreement or arrangement with the Company or any corporation
("Affiliate") affiliated with the Company within the meaning of
Section 1504 of the Code (collectively, "Severance Benefits"), in
the opnion of tax counsel selected by the Company and acceptable
to Employee, constitute "parachute payments" within the meaning
of Section 280G (b)(2) of the Code, and the present value of such
"parachute payments" equals or exceeds three times the average of
the annual compensation payable to Employee by the Company (or an
Affiliate) and includable in Employee's gross income for federal
income tax purposes for the five years preceding the year in
which the Employee was terminated without cause under Section
6(b) of this Agreement (including, without limitation, a
termination without cause upon a Change of Control)("Base
Amount"), if, but only if Employee so elects in writing, such
Severance Benefits shall be reduced to an amount the present
value of which (when combined with the present value of any other
payments or benefits otherwise received or to be received by
Employee from the Company or an Affiliate that are deemed
"parachute payments") is equal to 2.99 times the Base Amount,
notwithstanding any other provision to the contrary in this
Agreement. However, the Severance Benefits shall not be reduced
if in the opinion of such tax counsel, the Severance Benefits (in
their full amount or as partially reduced, as the case may be)
plus all other payments or benefits which constitute "parachute
payments" within the meaning of Section 280G (b)(2) of the Code
are reasonable compensation for services actually rendered,
within the meaning of Section 280G (b)(4) of the Code, and such
payments are deductible by the Company. The Base Amount shall
include every type and form of compensation includable in
Employee's gross income in respect of his employment by the
company (or an Affiliate), except to the extent otherwise
provided in temporary or final regulations promulgated under
Section 280G (b) of the Code. For purposes of this Section 6
(g)(ii), a "change in ownership or control" shall have the
meaning set forth in Section 280G (b) of the Code and any
temporary or final regulations promulgated thereunder. The
present value of any non-cash benefit or any deferred cash
payment shall be determined by the Company's independent auditors
in accordance with the principles of Sections 280G (d)(3) and (4)
of the Code.
iii) Employee shall have the right to request that the
Company obtain a ruling from the Internal Revenue Service
("Service") as to whether any or all payments or benefits
determined by such tax counsel are, in the view of the Service,
"parachute payments" under Section 280G. If a ruling is sought
pursuant to executive's request, no Severance Benefits payable
under this Agreement shall be made to Employee to the extent they
would exceed 2.99 times the Base Amount until after 15 days from
the date of such ruling. For purposes of this Section 6,
Employee
5
<PAGE>
and the Company agree to be bound by the Service's ruling as to
whether payments constitute "parachute payments" under Section
280G. If the Service declines, for any reason, to provide the
ruling requested, the tax counsel's opinion provided with respect
to what payments or benefits constitute "parachute payments"
shall control, and the period during which the excessive portion
of the Severance Benefits may be deferred shall be extended to a
date 15 days from the date of the Service's notice indicating
that no ruling would be forthcoming.
iv) If Section 280G, or any successor statute, is repealed,
this Section 6(g) shall cease to be effective on the effective of
such repeal. The parties to this Agreement recognize that final
regulations under Section 280G of the Code may affect the amounts
that may be paid under this Agreement and agree that, upon
issuance of such final regulations this Agreement may be modified
as in good faith deemed necessary in light of the provisions of
such regulations to achieve the purposes of this Agreement, and
that consent to such modifications shall not be unreasonably
withheld.
7. NON-COMPETITION; CONFIDENTIAL INFORMATION.
(a) CONFIDENTIAL INFORMATION. Employee acknowledges that
Employee may receive, or contribute to the production of, Confidential
Information. For purposes of this Agreement, Employee agrees that
"Confidential Information" shall mean information or material
proprietary to Company or designated as Confidential Information by
Company and not generally known by non-Company personnel, which
Employee develops or of or to which Employee may obtain knowledge or
access through or as a result of Employee's relationship with Company
(including information conceived, originated, discovered or developed
in whole or in part by Employee). Confidential Information includes,
but is not limited to, the following types of information and other
information of a similar nature (whether or not reduced to writing)
related to Company's business: discoveries, inventions, ideas,
concepts, research, development, processes, procedures, "know-how",
formulae, marketing techniques and materials, marketing and
development plans, business plans, customer names and other
information related to customers, price lists, pricing policies,
financial information, employee compensation, and computer programs
and systems. Confidential Information also includes any information
described above which Company obtains from another party and which
Company treats as proprietary or designates as Confidential
Information, whether or not owned by or developed by Company.
Employee acknowledges that the Confidential Information derives
independent economic value, actual or potential, from not being
generally known to, and not being readily ascertainable by proper
means by, other persons who can obtain economic value from its
disclosure or use. Information publicly known without breach of this
Agreement that is generally employed by the trade at or after the time
Employee first learns of such information, or generic information or
knowledge which Employee would have learned in the course of similar
employment or work elsewhere in the trade, shall not be deemed part of
the Confidential Information. Employee further agrees:
i) To furnish Company on demand, at any time during or
after employment, a complete list of the names and addresses of
all present, former and potential customers and other contacts
gained while an employee of Company in Employee's possession,
whether or not in the possession or within the knowledge of
Company;
6
<PAGE>
ii) that all notes, memoranda, documentation and records in
any way incorporating or reflecting any Confidential Information
shall belong exclusively to Company, and Employee agrees to turn
over all copies of such materials in Employee's control to
Company upon request or upon termination of Employee's employment
with Company;
iii) that while employed by Company and thereafter Employee
will hold in confidence and not directly or indirectly reveal,
report, publish, disclose or transfer any of the Confidential
Information to any person or entity, or utilize any of the
Confidential Information for any purpose, except in the course of
Employee's work for Company; and
iv) that any idea in whole or in part conceived of or made
by Employee during the term of his employment, consulting, or
similar relationship with Company which relates directly or
indirectly to Company's current or planned lines of business and
is made through the use of any of the Confidential Information of
Company or any of Company's equipment, facilities, trade secrets
or time, or which results from any work performed by Employee for
Company, shall belong exclusively to Company and shall be deemed
a part of the Confidential Information for purposes of this
Agreement. Employee hereby assigns and agrees to assign to
Company all rights in and to such Confidential Information
whether for purposes of obtaining patent or copyright protection
or otherwise. Employee shall acknowledge and deliver to Company,
without charge to Company (but at its expense) such written
instruments and do such other acts, including giving testimony in
support of Employee's authorship or inventorship, as the case may
be, necessary in the opinion of Company to obtain patents or
copyrights or to otherwise protect or vest in Company the entire
right and title in and to the Confidential Information.
(b) NON-COMPETITION. During the Term, Employee agrees that he
shall not enter into or engage, directly or indirectly, whether on his
own account or as a shareholder (other than as a less than 2%
shareholder of a publicly-held company), partner, joint venturer,
employee, consultant, advisor, and/or agent, of any person, firm,
corporation, or other entity, in any or all of the following
activities:
i) Engaging in Company Business in the United States;
ii) soliciting the past or existing customers, clients,
suppliers, or business patronage of Company or any of its
predecessors, affiliates or subsidiaries, or use any Confidential
Information (as defined in Section 7(a)) for the purpose of, or
which results in, competition with Company or any of its
affiliates or subsidiaries;
iii) soliciting the employment of any employees of Company
or any of its affiliates or subsidiaries; and
iv) promoting or assisting, financially or otherwise, any
person, firm, association, corporation, or other entity engaged
in the Company Business in the United States.
(c) INJUNCTIONS. It is agreed that the restrictions contained
in this Section 7 are reasonable, but it is recognized that damages in
the event of the breach of any of the restrictions will be difficult
or impossible to ascertain; and, therefore, Employee agrees that,
7
<PAGE>
in addition to and without limiting any other right or remedy Company may
have, Company shall have the right to an injunction against Employee issued
by a court of competent jurisdiction enjoining any such breach without
showing or proving any actual damage to Company.
(d) Employee also agrees, acknowledges, covenants, represents
and warrants as follows:
i) That he has read and fully understands the foregoing
restrictions and that he has consulted with a competent attorney
regarding the uses and enforceability of restrictive covenants;
ii) that he is aware that there may be defenses to the
enforceability of the foregoing restrictive covenants, based on
time or territory considerations, and that he knowingly,
consciously, intentionally and entirely voluntarily, irrevocably
waives any and all such defenses and will not assert the same in
any action or other proceeding brought by Company for the purpose
of enforcing the restrictive covenants or in any other action or
proceeding involving him and Company;
iii) that he is fully and completely aware that, and further
understands that, the foregoing restrictive covenants are an
essential part of the consideration for Company entering into
this Agreement and that Company is entering into this Agreement
in full reliance on these acknowledgments, covenants,
representations and warranties; and
iv) that the existence of any claim or cause of action by
him against Company, if any, whether predicated upon this
Agreement or otherwise, shall not constitute a defense to the
enforcement by Company of the foregoing restrictive covenants
which shall be litigated separately.
(e) If period of time and/or territory described above are
nevertheless held to be in any respect an unreasonable restriction
(after giving due consideration to the provisions of Section 7(d)
above), then it is agreed that the court so holding may reduce the
territory to which the restriction pertains or the period of time in
which it operates or may reduce both such territory and such period,
to the minimum extent necessary to render such provision enforceable.
(f) The obligations described in this Section 7 shall survive
any termination of this Agreement or any termination of the employment
relationship created hereunder for the maximum period of time said
obligations may be legally enforced.
8. INVENTIONS AND CREATIONS.
(a) Employee agrees that all inventions, discoveries,
developments, improvements, ideas, distinctive marks, symbols or
phrases, copyrightable creations, works of authorship, mask works and
other contributions including but not limited to software,
advertising, design, artwork, manuals and writings (collectively
referred to as "Creations"), whether or not protectable by statute,
which have been, or are in the future conceived, created, made,
developed or acquired by Employee, either individually or jointly,
while employee is retained by Company and relate in any manner to
Employee's work for Company, the research or business of Company or
fields into which the business of
8
<PAGE>
Company may extend, belong to Company. Employee hereby sells, assigns
and transfers to Company exclusively and irrevocably, without further
compensation, all ownership, title and rights in and to all of the
Creations. Employee further agrees to promptly and fully disclose the
Creations to Company in writing, if requested by Company, and to
execute and deliver any and all lawful applications, assignments and
other documents which Company requests for protecting the Creations in
the United States or any other country. Company shall have the full
and sole power to prosecute such applications and to take all other
actions concerning the Creations, and Employee agrees to cooperate
fully, at the expense of Company, in the preparation and prosecution
of all such applications and any legal actions and proceedings
concerning the Creations.
(b) Employee agrees and warrants that the Creations will be
Employee's original work and will not improperly or illegally
incorporate any material created by or belonging to others.
(c) Employee agrees to and does hereby sell, assign, convey and
transfer to Company any and all manuscripts, programs, writings,
pictorial materials, originals, camera-ready copies, and all drafts
and notes of the Creations, regardless of the media in which they
might exist, and to provide these materials to Company promptly
whenever requested by Company and upon completion of the Agreement,
and to execute documents, give testimony and otherwise cooperate fully
with Company to establish and/or confirm Company's ownership, patent,
copyright and/or trademark rights concerning the Creations.
(d) Without diminishing in any way the rights granted to Company
above, if a Creation is described in a patent, copyright or trademark
application, or is disclosed to a third party by Employee within two
(2) years after Employee's employment with Company is terminated,
Employee agrees that it is to be presumed that the Creation was
conceived, created, made, developed or acquired by Employee during the
period of his employment with Company, unless Employee can prove
otherwise by clear and convincing evidence.
9. GOVERNING LAW AND VENUE. Arizona law shall govern the
construction and enforcement of this Agreement and the parties agree that
any litigation pertaining to this Agreement shall be in courts located in
Maricopa County, Arizona.
10. CONSTRUCTION. The language in all parts of this Agreement shall
in all cases be construed as a whole according to its fair meaning and not
strictly for nor against any party. The Section headings contained in this
Agreement are for reference purposes only and will not affect in any way
the meaning or interpretation of this Agreement. All terms used in one
number or gender shall be construed to include any other number or gender
as the context may require. The parties agree that each party has reviewed
this Agreement and has had the opportunity to have counsel review the same
and that any rule of construction to the effect that ambiguities are to be
resolved against the drafting party shall not apply in the interpretation
of this Agreement or any amendment or any exhibits thereof.
11. NONDELEGABILITY OF EMPLOYEE'S RIGHTS AND COMPANY ASSIGNMENT
RIGHTS. The obligations, rights and benefits of Employee hereunder are
personal and may not be delegated, assigned or transferred in any manner
whatsoever, nor are such obligations, rights or benefits subject to
involuntary alienation, assignment or transfer. Upon reasonable notice to
Employee, Company may transfer Employee to an affiliate of Company, which
affiliate shall assume the obligations of Company under this Agreement.
This Agreement shall be assigned automatically to any entity merging with
or acquiring Company or its business.
9
<PAGE>
12. ASSIGNMENT. This Agreement and the respective rights, duties and
obligations of Employee hereunder may not be assigned or delegated by
Employee.
13. SEVERABILITY. In the event any term or provision of this
Agreement is declared by a court of competent jurisdiction to be invalid or
unenforceable for any reason, this Agreement shall remain in full force and
effect, and either (a) the invalid or unenforceable provision shall be
modified to the minimum extent necessary to make it valid and enforceable
or (b) if such a modification is not possible, this Agreement shall be
interpreted as if such invalid or unenforceable provision were not a part
hereof.
14. ATTORNEYS' FEES. Except as otherwise provided herein, in the
event any party hereto institutes an action or other proceeding to enforce
any rights arising out of this Agreement, the party prevailing in such
action or other proceeding shall be paid all reasonable costs and
attorneys' fees by the non-prevailing party, such fees to be set by the
court and not by a jury and to be included in any judgment entered in such
proceeding.
15. CONSIDERATION. It is expressly understood and agreed that this
document sets forth the entire consideration for this Agreement, and that
said consideration for this Agreement is contractual and not a mere
recital.
16. CONSTRUCTION. This Agreement is a negotiated agreement and any
documents delivered pursuant hereto shall be construed without regard to
the identity of the persons or entities who or which drafted the various
provisions thereof. Every provision of this Agreement and such other
employment-related documents shall be construed as though all parties
participated equally in the drafting thereof. Any legal rule of
construction that a document is to be construed against the drafting party
shall not be applicable and is expressly waived by Company and Employee.
17. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, all such counterparts shall be deemed to constitute one and
the same instrument, and each of said counterparts shall be deemed an
original hereof.
18. CAPTIONS. The captions used in this Agreement are inserted for
convenience only and shall not affect the meaning or construction of this
Agreement.
19. NOTICES. All notices required or permitted hereunder shall be
in writing and shall be deemed duly given upon receipt if either personally
delivered, sent by certified mail, return receipt requested, or sent by a
nationally-recognized overnight courier service, addressed to the parties
as follows:
If to Company: Renaissance Group International, Ltd.
------------- 7501 N. 16th Street, Suite 200
Phoenix, Arizona 85020
Attn: President
If to Employee: James Jones
-------------- 3227 N. Sycamore Place
Chandler, Arizona 85224
or to such other address as any party may provide to the other in
accordance with this Section.
10
<PAGE>
20. ENTIRE AGREEMENT. This Agreement constitutes the entire
agreement between the parties with respect to the subject matter hereof
(i.e., Employee's employment by Company) and supersedes all prior or
contemporaneous understandings or agreements in regard thereto; provided,
however, that (except as otherwise set forth herein) this Agreement shall
not affect or supersede any rights of Company under any other contracts or
other agreements between or otherwise involving the parties, any
restrictive covenants or any similar agreements. No modification or
addition to this Agreement shall be valid unless in writing, specifically
referring to this Agreement and signed by all parties hereto. No waiver of
any rights under this Agreement shall be valid unless in writing and signed
by the party to be charged with such waiver. No waiver of any term or
condition contained in this Agreement shall be deemed or construed as a
further or continuing waiver of such term or condition, unless the waiver
specifically provides otherwise.
IN WITNESS WHEREOF, the parties have executed this Agreement on the
1st day of February, 1998.
RENAISSANCE INTERNATIONAL GROUP, EMPLOYEE:
LTD, a Nevada corporation
By: /s/ TENNESSEE WEBB /s/ JAMES JONES
-------------------------------- ---------------------------------
Its: President James Jones
----------------------------
11
EXHIBIT 10(iv)
EMPLOYMENT AGREEMENT
THIS AGREEMENT (this "Agreement") is by and between RENAISSANCE
INTERNATIONAL GROUP, LTD., a Nevada corporation ("Company"), and JOHN
WILLIAMS, an individual ("Employee").
RECITALS:
A. Company is engaged, among other things, in the business of
managing and operating medical facilities and developing digital interface
technology systems for the medical and related industries ("Company
Business"). Employee has substantial experience and expertise in the area
of corporate finance.
B. Company desires to retain the services of Employee as an
executive, to act as its CHIEF FINANCIAL OFFICER/VICE PRESIDENT OF FINANCE,
and Employee desires and is willing to continue employment with the Company
in that capacity.
C. Company and Employee desire to embody the terms and conditions of
Employee's employment in a written agreement, which will supersede all
prior agreements of employment, whether written or oral, pursuant to the
terms and conditions hereinafter set forth.
D. The Board of Directors of Company (the "Board"), has determined
that it is in the best interests of Company and its shareholders to assure
that Company will have the continued dedication of Employee,
notwithstanding the possibility, threat or occurrence of a Change of
Control (as defined in Section 6(f)) of Company. The Board believes it is
imperative to diminish the inevitable distraction of Employee by virtue of
the personal uncertainties and risks created by a pending or threatened
Change of Control and to encourage Employee's full attention and dedication
to Company currently and in the event of any threatened or pending Change
of Control, and to provide Employee with compensation and benefits
arrangements upon a Change of Control which ensure that the compensation
and benefits expectations of Employee will be satisfied and which are
competitive with those of other corporations. Therefore, in order to
accomplish these objectives, the Board has caused Company to enter into
this Agreement.
AGREEMENT
In consideration of the recitals and mutual agreements hereinafter set
forth, the parties agree as follows:
1. EMPLOYMENT. Company agrees to continue to employ Employee on a
full-time basis, in accordance with the terms and conditions set forth
herein, and Employee agrees to accept such continued full-time employment
in accordance with said terms and conditions. Employee shall have such
duties and responsibilities as shall be allocated to him from time to time
by the Board in his capacity as the Chief Financial Officer/Vice President
of Finance. Employee's title and duties may be changed from time to time
in the discretion of Company's Board so long as he is maintained in an
executive capacity with duties, responsibilities and privileges
commensurate with his current level of employment. Employee agrees to
devote his full time, skill, knowledge and attention to the business of
Company and the performance of his duties under this Agreement. Employee
shall report directly to the President of Company.
2. TERM. The initial term (the "Term") of employment under this
Agreement shall commence on March 16, 1998 (the "Effective Date") and shall
continue for a period of five (5)
<PAGE>
years, unless earlier terminated as set forth in Section 6 below.
Thereafter, this Agreement shall automatically renew for an additional
three-year period (the "Renewal Term") unless either party gives the other
written notice of non-renewal at least 30 days prior to the expiration of
the Term or Renewal Term.
3. COMPENSATION.
(a) BASE SALARY. Company agrees to pay Employee an initial
annual base salary of $110,000, before deducting all applicable
withholdings which shall be payable in accordance with Company's
standard executive payroll policies as they may be revised from time
to time. Upon the execution of this Agreement, Company also agrees to
pay Employee 50,000 shares of Company's common stock. Employee's
annual base salary shall thereafter be subject to adjustment in
accordance with Company's standard executive compensation policies,
but in no event shall Employee's annual base salary be less than
$110,000 per year during the Term or Renewal Term.
(b) INCENTIVE BONUS. After commencing his duties as Chief
Financial Officer/Vice President of Finance, Company's Executive
Committee shall, at its option, design and present to the Board for
review, adjustment and adoption, an incentive compensation program for
key employees. Employee shall be designated as a key employee and
shall be entitled to participate in such program, and if financial
targets established pursuant to the program are met, will be eligible
to earn in any year an additional maximum amount of compensation in
the form of stock, stock options and/or cash as determined by
Company's Executive Committee.
(c) STOCK OPTIONS. Upon the execution of this Agreement,
Employee shall receive stock options to acquire up to 250,000 shares
of the Common Stock of the Company at a price equal to the greater of
$2.50 per share or fifty percent (50%) of the public bid price of the
Common Stock of the Company upon the date of the exercise of any or
all of the stock options. Such stock options shall be exercisable
from the date Company commences trading on the Nasdaq Bulletin Board
until the expiration of the Term, notwithstanding any termination
during the Term pursuant to Section 6(c) herein. The issuance of said
stock options does not preclude Company from issuing to Employee
additional stock options pursuant to a qualified or non-qualified
plan.
(d) DEDUCTIONS. Company shall deduct from the payments made to
Employee hereunder any federal, state or local withholding or other
taxes or charges which Company is required to deduct under applicable
law, and all amounts payable to Employee under this Agreement are
stated before any such deductions. Company shall have the right to
rely upon written opinion of counsel if any questions arise as to any
deductions.
4. BENEFITS.
2
<PAGE>
(a) INSURANCE. In addition to the compensation described above,
while Employee is employed hereunder, Company shall pay for and
provide Employee and his dependents with the same amount and type of
health, medical and life insurance as is provided from time to time to
executive officers of Company during the Term and Renewal Term, if
applicable.
(b) EXPENSE REIMBURSEMENT. In addition to the compensation and
benefits provided above, Company shall, upon prior approval of the
Executive Committee and receipt of appropriate documentation,
reimburse Employee each month for his reasonable travel, lodging and
other ordinary and necessary business expenses consistent with
Company's policies as in effect from time to time.
(c) RETIREMENT PLAN. In addition to the compensation and
benefits provided above, Company shall pay for and provide Employee a
retirement or pension plan as is provided from time to time to
executive officers of Company during the Term and Renewal Term, if
applicable.
5. VACATION. Employee shall be entitled to vacation with pay in
accordance with Company's vacation policy as in effect from time to time.
In addition, Employee shall be entitled to such holidays as Company may
approve for its executive personnel.
6. TERMINATION. The Board may terminate Employee's employment by
Company prior to the expiration of the Term or Renewal Term in the manner
provided in either Section 6(a) or Section 6(b). Additionally, if notice
of non-renewal is given pursuant to Section 2, the term of employment shall
expire at the end of the Term and Employee shall be entitled to
compensation as provided in Section 6(e).
(a) FOR CAUSE. Company may terminate this Agreement for cause
upon written notice to the Employee stating the facts constituting
such cause, provided that Employee shall have 10 days following such
notice to cure any conduct or act, if curable, alleged to provide
grounds for termination for cause hereunder. In the event of
termination for cause, any unexercised stock options granted pursuant
to Section 3(c) shall automatically expire, and Company shall be
obligated to pay Employee only the salary due him through the date of
termination pursuant to Section 3(a). Cause shall include material
neglect of duties, failure to abide by ethical and good faith
instructions or policies from or set by the Board, conviction of a
felony or serious misdemeanor offense or pleading guilty or NOLO
CONTENDERE to same, the commission by Employee of an act of dishonesty
or moral turpitude, Employee's breach of this Agreement, breach by
Employee of any other material obligation to Company, or upon the
bankruptcy, receivership, dissolution or cessation of business of
Company.
(b) WITHOUT CAUSE. Any termination of Employee by Company for
any other reason than for cause shall constitute a termination without
cause. Any termination resulting from a Change of Control as defined
below shall constitute a termination without cause without the
necessity of written notice to Employee. Upon termination under this
Section 6(b), Company shall (i) pay to Employee his base salary at the
time of termination due him through the date of the expiration of the
Term, or Renewal Term, if applicable; and (ii) within 60 days after
the end of the fiscal year in which termination pursuant to this
Section 6(b) occurs, Employee shall be entitled to receive a
separation payment as defined below.
(c) DISABILITY. If during the Term, or Renewal Term, if
applicable, Employee fails to perform his duties hereunder because of
physical or mental illness or other incapacity for a period of two
consecutive months, or for 45 days during any 120-day period, Company
3
<PAGE>
shall have the right to terminate this Agreement without further obligation
hereunder except for any bonus amount payable in accordance with this
Section 6(c) and any amounts payable pursuant to disability plans generally
applicable to executive employees. Company shall provide Employee with
notice of commencement of the disability period, which period cannot
commence more than seven (7) days prior to the date of the notice. If
there is any dispute as to whether Employee is or was physically or
mentally disabled under this Agreement, or whether his disability has
ceased and he is able to resume his duties, such question shall be
submitted to a licensed physician agreed upon by the parties. Employee
shall submit to such examinations and provide information as such physician
may request, and the determination of such physician as to Employee's
physical or mental condition shall be binding and conclusive on the
parties. Company agrees to pay the cost of any such physician's services,
tests and examinations.
(d) DEATH. If Employee dies during the Term, or Renewal Term,
if applicable, this Agreement shall terminate immediately, and the
Employee's legal representatives shall be entitled to receive the base
salary due the Employee through the last day of the calendar month in
which his death shall have occurred and any other death benefits
generally applicable to executive employees.
(e) CHANGE OF CONTROL. For purposes of this Agreement (except
to the extent governed or affected by Section 280G of the Internal
Revenue Code of 1986, as amended (the "Code")), "Change in Control"
shall be deemed to have occurred if the conditions set forth in any
one of the following paragraphs shall have been satisfied:
i) Any "person" (as such term is used in Section 13(d) and
14(d)) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act") or "persons" acting in concert, is or becomes the
"beneficial owner" (as defined in Rule 13d-3 under the Exchange
Act), directly or indirectly, of securities of the Company
representing twenty-five percent (25%) or more of the combined
voting power of Company's then outstanding securities, provided
that the term "person" for purposes of this Section 6(f)(i) shall
exclude Company or any trustee or other fiduciary holding
securities under an employee benefit plan of Company; or
ii) The stockholders of Company approve an acquisition
and/or merger or consolidation of Company with any other
corporation, other than (A) an acquisition and/or a merger or
consolidation which would result in the voting securities of
Company outstanding immediately prior thereto continuing to
represent (either by remaining outstanding or by being converted
into voting securities of the surviving entity), in combination
with the ownership of any trustee or other fiduciary holding
securities under an employee benefit plan of Company, at least
seventy percent (70%) of the combined voting power of the voting
securities of Company or such surviving entity outstanding
immediately after such merger or consolidation, or (B) an
acquisition and/or merger or consolidation effected to implement
a recapitalization of Company (or similar transaction) in which
no person acquires more than fifty percent (50%) of the combined
voting power of Company's then outstanding securities; or
4
<PAGE>
iii) The stockholders of Company approve a plan of complete
liquidation of Company or an agreement for the sale or
disposition by Company of all or substantially all Company's
assets.
(f) Separation Payment. i) For purposes of this Agreement,
"Separation Payment" means a payment equal to 2.99 times the
Employee's annual base salary at the time of termination,
subject to the limitations in (6)(g)(ii), below.
ii) If the Separation Payment plus any other severance
benefits or any other payments or benefits received or to be
received by Employee from the Company (whether payable pursuant
to the terms of this Agreement or pursuant to any other plan,
agreement or arrangement with the Company or any corporation
("Affiliate") affiliated with the Company within the meaning of
Section 1504 of the Code (collectively, "Severance Benefits"), in
the opnion of tax counsel selected by the Company and acceptable
to Employee, constitute "parachute payments" within the meaning
of Section 280G (b)(2) of the Code, and the present value of such
"parachute payments" equals or exceeds three times the average of
the annual compensation payable to Employee by the Company (or an
Affiliate) and includable in Employee's gross income for federal
income tax purposes for the five years preceding the year in
which the Employee was terminated without cause under Section
6(b) of this Agreement (including, without limitation, a
termination without cause upon a Change of Control) ("Base
Amount"), if, but only if Employee so elects in writing, such
Severance Benefits shall be reduced to an amount the present
value of which (when combined with the present value of any other
payments or benefits otherwise received or to be received by
Employee from the Company or an Affiliate that are deemed
"parachute payments") is equal to 2.99 times the Base Amount,
notwithstanding any other provision to the contrary in this
Agreement. However, the Severance Benefits shall not be reduced
if in the opinion of such tax counsel, the Severance Benefits (in
their full amount or as partially reduced, as the case may be)
plus all other payments or benefits which constitute "parachute
payments" within the meaning of Section 280G (b)(2) of the Code
are reasonable compensation for services actually rendered,
within the meaning of Section 280G (b)(4) of the Code, and such
payments are deductible by the Company. The Base Amount shall
include every type and form of compensation includable in
Employee's gross income in respect of his employment by the
company (or an Affiliate), except to the extent otherwise
provided in temporary or final regulations promulgated under
Section 280G (b) of the Code. For purposes of this Section 6
(g)(ii), a "change in ownership or control" shall have the
meaning set forth in Section 280G (b) of the Code and any
temporary or final regulations promulgated thereunder. The
present value of any non-cash benefit or any deferred cash
payment shall be determined by the Company's independent auditors
in accordance with the principles of Sections 280G (d)(3) and (4)
of the Code.
iii) Employee shall have the right to request that the
Company obtain a ruling from the Internal Revenue Service
("Service") as to whether any or all payments or benefits
determined by such tax counsel are, in the view of the Service,
"parachute payments" under Section 280G. If a ruling is sought
pursuant to executive's request, no Severance Benefits payable
under this Agreement shall be made to Employee to the extent they
would exceed 2.99 times the Base Amount until after 15 days from
the date of such ruling. For purposes of this Section 6,
Employee
5
<PAGE>
and the Company agree to be bound by the Service's ruling as to
whether payments constitute "parachute payments" under Section
280G. If the Service declines, for any reason, to provide the
ruling requested, the tax counsel's opinion provided with respect
to what payments or benefits constitute "parachute payments"
shall control, and the period during which the excessive portion
of the Severance Benefits may be deferred shall be extended to a
date 15 days from the date of the Service's notice indicating
that no ruling would be forthcoming.
iv) If Section 280G, or any successor statute, is repealed,
this Section 6(g) shall cease to be effective on the effective of
such repeal. The parties to this Agreement recognize that final
regulations under Section 280G of the Code may affect the amounts
that may be paid under this Agreement and agree that, upon
issuance of such final regulations this Agreement may be modified
as in good faith deemed necessary in light of the provisions of
such regulations to achieve the purposes of this Agreement, and
that consent to such modifications shall not be unreasonably
withheld.
7. NON-COMPETITION; CONFIDENTIAL INFORMATION.
(a) CONFIDENTIAL INFORMATION. Employee acknowledges that
Employee may receive, or contribute to the production of, Confidential
Information. For purposes of this Agreement, Employee agrees that
"Confidential Information" shall mean information or material
proprietary to Company or designated as Confidential Information by
Company and not generally known by non-Company personnel, which
Employee develops or of or to which Employee may obtain knowledge or
access through or as a result of Employee's relationship with Company
(including information conceived, originated, discovered or developed
in whole or in part by Employee). Confidential Information includes,
but is not limited to, the following types of information and other
information of a similar nature (whether or not reduced to writing)
related to Company's business: discoveries, inventions, ideas,
concepts, research, development, processes, procedures, "know-how",
formulae, marketing techniques and materials, marketing and
development plans, business plans, customer names and other
information related to customers, price lists, pricing policies,
financial information, employee compensation, and computer programs
and systems. Confidential Information also includes any information
described above which Company obtains from another party and which
Company treats as proprietary or designates as Confidential
Information, whether or not owned by or developed by Company.
Employee acknowledges that the Confidential Information derives
independent economic value, actual or potential, from not being
generally known to, and not being readily ascertainable by proper
means by, other persons who can obtain economic value from its
disclosure or use. Information publicly known without breach of this
Agreement that is generally employed by the trade at or after the time
Employee first learns of such information, or generic information or
knowledge which Employee would have learned in the course of similar
employment or work elsewhere in the trade, shall not be deemed part of
the Confidential Information. Employee further agrees:
i) To furnish Company on demand, at any time during or
after employment, a complete list of the names and addresses of
all present, former and potential customers and other contacts
gained while an employee of Company in Employee's possession,
whether or not in the possession or within the knowledge of
Company;
6
<PAGE>
ii) that all notes, memoranda, documentation and records in
any way incorporating or reflecting any Confidential Information
shall belong exclusively to Company, and Employee agrees to turn
over all copies of such materials in Employee's control to
Company upon request or upon termination of Employee's employment
with Company;
iii) that while employed by Company and thereafter Employee
will hold in confidence and not directly or indirectly reveal,
report, publish, disclose or transfer any of the Confidential
Information to any person or entity, or utilize any of the
Confidential Information for any purpose, except in the course of
Employee's work for Company; and
iv) that any idea in whole or in part conceived of or made
by Employee during the term of his employment, consulting, or
similar relationship with Company which relates directly or
indirectly to Company's current or planned lines of business and
is made through the use of any of the Confidential Information of
Company or any of Company's equipment, facilities, trade secrets
or time, or which results from any work performed by Employee for
Company, shall belong exclusively to Company and shall be deemed
a part of the Confidential Information for purposes of this
Agreement. Employee hereby assigns and agrees to assign to
Company all rights in and to such Confidential Information
whether for purposes of obtaining patent or copyright protection
or otherwise. Employee shall acknowledge and deliver to Company,
without charge to Company (but at its expense) such written
instruments and do such other acts, including giving testimony in
support of Employee's authorship or inventorship, as the case may
be, necessary in the opinion of Company to obtain patents or
copyrights or to otherwise protect or vest in Company the entire
right and title in and to the Confidential Information.
(b) NON-COMPETITION. During the Term, Employee agrees that he
shall not enter into or engage, directly or indirectly, whether on his
own account or as a shareholder (other than as a less than 2%
shareholder of a publicly-held company), partner, joint venturer,
employee, consultant, advisor, and/or agent, of any person, firm,
corporation, or other entity, in any or all of the following
activities:
i) Engaging in Company Business in the United States;
ii) soliciting the past or existing customers, clients,
suppliers, or business patronage of Company or any of its
predecessors, affiliates or subsidiaries, or use any Confidential
Information (as defined in Section 7(a)) for the purpose of, or
which results in, competition with Company or any of its
affiliates or subsidiaries;
iii) soliciting the employment of any employees of Company
or any of its affiliates or subsidiaries; and
iv) promoting or assisting, financially or otherwise, any
person, firm, association, corporation, or other entity engaged
in the Company Business in the United States.
(c) INJUNCTIONS. It is agreed that the restrictions contained
in this Section 7 are reasonable, but it is recognized that damages in
the event of the breach of any of the restrictions will be difficult
or impossible to ascertain; and, therefore, Employee agrees that,
7
<PAGE>
in addition to and without limiting any other right or remedy Company
may have, Company shall have the right to an injunction against
Employee issued by a court of competent jurisdiction enjoining any
such breach without showing or proving any actual damage to Company.
(d) Employee also agrees, acknowledges, covenants, represents
and warrants as follows:
i) That he has read and fully understands the foregoing
restrictions and that he has consulted with a competent attorney
regarding the uses and enforceability of restrictive covenants;
ii) that he is aware that there may be defenses to the
enforceability of the foregoing restrictive covenants, based on
time or territory considerations, and that he knowingly,
consciously, intentionally and entirely voluntarily, irrevocably
waives any and all such defenses and will not assert the same in
any action or other proceeding brought by Company for the purpose
of enforcing the restrictive covenants or in any other action or
proceeding involving him and Company;
iii) that he is fully and completely aware that, and further
understands that, the foregoing restrictive covenants are an
essential part of the consideration for Company entering into
this Agreement and that Company is entering into this Agreement
in full reliance on these acknowledgments, covenants,
representations and warranties; and
iv) that the existence of any claim or cause of action by
him against Company, if any, whether predicated upon this
Agreement or otherwise, shall not constitute a defense to the
enforcement by Company of the foregoing restrictive covenants
which shall be litigated separately.
(e) If period of time and/or territory described above are
nevertheless held to be in any respect an unreasonable restriction
(after giving due consideration to the provisions of Section 7(d)
above), then it is agreed that the court so holding may reduce the
territory to which the restriction pertains or the period of time in
which it operates or may reduce both such territory and such period,
to the minimum extent necessary to render such provision enforceable.
(f) The obligations described in this Section 7 shall survive
any termination of this Agreement or any termination of the employment
relationship created hereunder for the maximum period of time said
obligations may be legally enforced.
8. INVENTIONS AND CREATIONS.
(a) Employee agrees that all inventions, discoveries,
developments, improvements, ideas, distinctive marks, symbols or
phrases, copyrightable creations, works of authorship, mask works and
other contributions including but not limited to software,
advertising, design, artwork, manuals and writings (collectively
referred to as "Creations"), whether or not protectable by statute,
which have been, or are in the future conceived, created, made,
developed or acquired by Employee, either individually or jointly,
while employee is retained by Company and relate in any manner to
Employee's work for Company, the research or business of Company or
fields into which the business of
8
<PAGE>
Company may extend, belong to Company. Employee hereby sells, assigns
and transfers to Company exclusively and irrevocably, without further
compensation, all ownership, title and rights in and to all of the
Creations. Employee further agrees to promptly and fully disclose the
Creations to Company in writing, if requested by Company, and to
execute and deliver any and all lawful applications, assignments and
other documents which Company requests for protecting the Creations in
the United States or any other country. Company shall have the full
and sole power to prosecute such applications and to take all other
actions concerning the Creations, and Employee agrees to cooperate
fully, at the expense of Company, in the preparation and prosecution
of all such applications and any legal actions and proceedings
concerning the Creations.
(b) Employee agrees and warrants that the Creations will be
Employee's original work and will not improperly or illegally
incorporate any material created by or belonging to others.
(c) Employee agrees to and does hereby sell, assign, convey and
transfer to Company any and all manuscripts, programs, writings,
pictorial materials, originals, camera-ready copies, and all drafts
and notes of the Creations, regardless of the media in which they
might exist, and to provide these materials to Company promptly
whenever requested by Company and upon completion of the Agreement,
and to execute documents, give testimony and otherwise cooperate fully
with Company to establish and/or confirm Company's ownership, patent,
copyright and/or trademark rights concerning the Creations.
(d) Without diminishing in any way the rights granted to Company
above, if a Creation is described in a patent, copyright or trademark
application, or is disclosed to a third party by Employee within two
(2) years after Employee's employment with Company is terminated,
Employee agrees that it is to be presumed that the Creation was
conceived, created, made, developed or acquired by Employee during the
period of his employment with Company, unless Employee can prove
otherwise by clear and convincing evidence.
9. GOVERNING LAW AND VENUE. Arizona law shall govern the
construction and enforcement of this Agreement and the parties agree that
any litigation pertaining to this Agreement shall be in courts located in
Maricopa County, Arizona.
10. CONSTRUCTION. The language in all parts of this Agreement shall
in all cases be construed as a whole according to its fair meaning and not
strictly for nor against any party. The Section headings contained in this
Agreement are for reference purposes only and will not affect in any way
the meaning or interpretation of this Agreement. All terms used in one
number or gender shall be construed to include any other number or gender
as the context may require. The parties agree that each party has reviewed
this Agreement and has had the opportunity to have counsel review the same
and that any rule of construction to the effect that ambiguities are to be
resolved against the drafting party shall not apply in the interpretation
of this Agreement or any amendment or any exhibits thereof.
11. NONDELEGABILITY OF EMPLOYEE'S RIGHTS AND COMPANY ASSIGNMENT
RIGHTS. The obligations, rights and benefits of Employee hereunder are
personal and may not be delegated, assigned or transferred in any manner
whatsoever, nor are such obligations, rights or benefits subject to
involuntary alienation, assignment or transfer. Upon reasonable notice to
Employee, Company may transfer Employee to an affiliate of Company, which
affiliate shall assume the obligations of Company under this Agreement.
This Agreement shall be assigned automatically to any entity merging with
or acquiring Company or its business.
9
<PAGE>
12. ASSIGNMENT. This Agreement and the respective rights, duties and
obligations of Employee hereunder may not be assigned or delegated by
Employee.
13. SEVERABILITY. In the event any term or provision of this
Agreement is declared by a court of competent jurisdiction to be invalid or
unenforceable for any reason, this Agreement shall remain in full force and
effect, and either (a) the invalid or unenforceable provision shall be
modified to the minimum extent necessary to make it valid and enforceable
or (b) if such a modification is not possible, this Agreement shall be
interpreted as if such invalid or unenforceable provision were not a part
hereof.
14. ATTORNEYS' FEES. Except as otherwise provided herein, in the
event any party hereto institutes an action or other proceeding to enforce
any rights arising out of this Agreement, the party prevailing in such
action or other proceeding shall be paid all reasonable costs and
attorneys' fees by the non-prevailing party, such fees to be set by the
court and not by a jury and to be included in any judgment entered in such
proceeding.
15. CONSIDERATION. It is expressly understood and agreed that this
document sets forth the entire consideration for this Agreement, and that
said consideration for this Agreement is contractual and not a mere
recital.
16. CONSTRUCTION. This Agreement is a negotiated agreement and any
documents delivered pursuant hereto shall be construed without regard to
the identity of the persons or entities who or which drafted the various
provisions thereof. Every provision of this Agreement and such other
employment-related documents shall be construed as though all parties
participated equally in the drafting thereof. Any legal rule of
construction that a document is to be construed against the drafting party
shall not be applicable and is expressly waived by Company and Employee.
17. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, all such counterparts shall be deemed to constitute one and
the same instrument, and each of said counterparts shall be deemed an
original hereof.
18. CAPTIONS. The captions used in this Agreement are inserted for
convenience only and shall not affect the meaning or construction of this
Agreement.
19. NOTICES. All notices required or permitted hereunder shall be
in writing and shall be deemed duly given upon receipt if either personally
delivered, sent by certified mail, return receipt requested, or sent by a
nationally-recognized overnight courier service, addressed to the parties
as follows:
If to Company: Renaissance Group International, Ltd.
------------- 7501 N. 16th Street, Suite 200
Phoenix, Arizona 85020
Attn: President
If to Employee: John Williams
-------------- 4102 N. Ranier
Mesa, AZ 85215
or to such other address as any party may provide to the other in
accordance with this Section.
10
<PAGE>
20. ENTIRE AGREEMENT. This Agreement constitutes the entire
agreement between the parties with respect to the subject matter hereof
(i.e., Employee's employment by Company) and supersedes all prior or
contemporaneous understandings or agreements in regard thereto; provided,
however, that (except as otherwise set forth herein) this Agreement shall
not affect or supersede any rights of Company under any other contracts or
other agreements between or otherwise involving the parties, any
restrictive covenants or any similar agreements. No modification or
addition to this Agreement shall be valid unless in writing, specifically
referring to this Agreement and signed by all parties hereto. No waiver of
any rights under this Agreement shall be valid unless in writing and signed
by the party to be charged with such waiver. No waiver of any term or
condition contained in this Agreement shall be deemed or construed as a
further or continuing waiver of such term or condition, unless the waiver
specifically provides otherwise.
IN WITNESS WHEREOF, the parties have executed this Agreement on the
16th day of March, 1998.
RENAISSANCE INTERNATIONAL GROUP, EMPLOYEE:
LTD, a Nevada corporation
By: /s/ KEVIN JONES /s/ JOHN WILLIAMS
---------------------------------- ---------------------------------
Its: President John Williams
--------------------------------
11
EXHIBIT 10(v)
EMPLOYMENT AGREEMENT
THIS AGREEMENT (this "Agreement") is by and between RENAISSANCE
INTERNATIONAL GROUP, LTD., a Nevada corporation ("Company"), and WILLIAM D.
O'NEAL, an individual ("Employee").
RECITALS:
A. Company is engaged, among other things, in the business of
managing and operating medical facilities and developing digital interface
technology systems for the medical and related industries ("Company
Business"). Employee has substantial experience and expertise in the area
of corporate law and management.
B. Company desires to retain the services of Employee as an
executive, to act as its SENIOR VICE PRESIDENT OF BUSINESS AFFAIRS, and
Employee desires and is willing to continue employment with the Company in
that capacity.
C. Company and Employee desire to embody the terms and conditions of
Employee's employment in a written agreement, which will supersede all
prior agreements of employment, whether written or oral, pursuant to the
terms and conditions hereinafter set forth.
D. The Board of Directors of Company (the "Board"), has determined
that it is in the best interests of Company and its shareholders to assure
that Company will have the continued dedication of Employee,
notwithstanding the possibility, threat or occurrence of a Change of
Control (as defined in Section 6(f)) of Company. The Board believes it is
imperative to diminish the inevitable distraction of Employee by virtue of
the personal uncertainties and risks created by a pending or threatened
Change of Control and to encourage Employee's full attention and dedication
to Company currently and in the event of any threatened or pending Change
of Control, and to provide Employee with compensation and benefits
arrangements upon a Change of Control which ensure that the compensation
and benefits expectations of Employee will be satisfied and which are
competitive with those of other corporations. Therefore, in order to
accomplish these objectives, the Board has caused Company to enter into
this Agreement.
AGREEMENT
In consideration of the recitals and mutual agreements hereinafter set
forth, the parties agree as follows:
1. EMPLOYMENT. Company agrees to continue to employ Employee on a
full-time basis, in accordance with the terms and conditions set forth
herein, and Employee agrees to accept such continued full-time employment
in accordance with said terms and conditions. Employee shall have such
duties and responsibilities as shall be allocated to him from time to time
by the Board in his capacity as the Senior Vice President of Business
Affairs. Employee's title and duties may be changed from time to time in
the discretion of Company's Board so long as he is maintained in an
executive capacity with duties, responsibilities and privileges
commensurate with his current level of employment. Employee agrees to
devote his full time, skill, knowledge and attention to the business of
Company and the performance of his duties under this Agreement. Employee
shall report directly to the President of Company.
2. TERM. The initial term (the "Term") of employment under this
Agreement shall commence on February 1, 1998 (the "Effective Date") and
shall continue for a period of five (5)
<PAGE>
years, unless earlier terminated as set forth in Section 6 below.
Thereafter, this Agreement shall automatically renew for an additional
three-year period (the "Renewal Term") unless either party gives the other
written notice of non-renewal at least 30 days prior to the expiration of
the Term or Renewal Term.
3. COMPENSATION.
(a) BASE SALARY. Company agrees to pay Employee an initial
annual base salary of $120,000, before deducting all applicable
withholdings which shall be payable in accordance with Company's
standard executive payroll policies as they may be revised from time
to time. Employee's annual base salary shall thereafter be subject to
annual adjustment in accordance with Company's standard executive
compensation policies, but in no event shall Employee's annual base
salary be less than $120,000 per year during the Term or Renewal Term.
(b) INCENTIVE BONUS. After commencing his duties as Senior Vice
President of Business Affairs, Company's Executive Committee shall, at
its option, design and present to the Board for review, adjustment and
adoption, an incentive compensation program for key employees.
Employee shall be designated as a key employee and shall be entitled
to participate in such program, and if financial targets established
pursuant to the program are met, will be eligible to earn in any year
an additional maximum amount of compensation in the form of stock,
stock options and/or cash as determined by Company's Executive
Committee.
(c) DEDUCTIONS. Company shall deduct from the payments made to
Employee hereunder any federal, state or local withholding or other
taxes or charges which Company is required to deduct under applicable
law, and all amounts payable to Employee under this Agreement are
stated before any such deductions. Company shall have the right to
rely upon written opinion of counsel if any questions arise as to any
deductions.
4. BENEFITS.
2
<PAGE>
(a) INSURANCE. In addition to the compensation described above,
while Employee is employed hereunder, Company shall pay for and
provide Employee and his dependents with the same amount and type of
health, medical and life insurance as is provided from time to time to
executive officers of Company during the Term and Renewal Term, if
applicable.
(b) EXPENSE REIMBURSEMENT. In addition to the compensation and
benefits provided above, Company shall, upon prior approval of the
Executive Committee and receipt of appropriate documentation,
reimburse Employee each month for his reasonable travel, lodging and
other ordinary and necessary business expenses consistent with
Company's policies as in effect from time to time.
(c) RETIREMENT PLAN. In addition to the compensation and
benefits provided above, Company shall pay for and provide Employee a
retirement or pension plan as is provided from time to time to
executive officers of Company during the Term and Renewal Term, if
applicable.
5. VACATION. Employee shall be entitled to vacation with pay in
accordance with Company's vacation policy as in effect from time to time.
In addition, Employee shall be entitled to such holidays as Company may
approve for its executive personnel.
6. TERMINATION. The Board may terminate Employee's employment by
Company prior to the expiration of the Term or Renewal Term in the manner
provided in either Section 6(a) or Section 6(b). Additionally, if notice
of non-renewal is given pursuant to Section 2, the term of employment shall
expire at the end of the Term and Employee shall be entitled to
compensation as provided in Section 6(e).
(a) FOR CAUSE. Company may terminate this Agreement for cause
upon written notice to the Employee stating the facts constituting
such cause, provided that Employee shall have 10 days following such
notice to cure any conduct or act, if curable, alleged to provide
grounds for termination for cause hereunder. In the event of
termination for cause, any unexercised stock options granted pursuant
to Section 3(c) shall automatically expire, and Company shall be
obligated to pay Employee only the salary due him through the date of
termination pursuant to Section 3(a). Cause shall include material
neglect of duties, failure to abide by ethical and good faith
instructions or policies from or set by the Board, conviction of a
felony or serious misdemeanor offense or pleading guilty or NOLO
CONTENDERE to same, the commission by Employee of an act of dishonesty
or moral turpitude, Employee's breach of this Agreement, breach by
Employee of any other material obligation to Company, or upon the
bankruptcy, receivership, dissolution or cessation of business of
Company.
(b) WITHOUT CAUSE. Any termination of Employee by Company for
any other reason than for cause shall constitute a termination without
cause. Any termination resulting from a Change of Control as defined
below shall constitute a termination without cause without the
necessity of written notice to Employee. Upon termination under this
Section 6(b), Company shall (i) pay to Employee his base salary at the
time of termination due him through the date of the expiration of the
Term, or Renewal Term, if applicable; and (ii) within 60 days after
the end of the fiscal year in which termination pursuant to this
Section 6(b) occurs, Employee shall be entitled to receive a
separation payment as defined below.
(c) DISABILITY. If during the Term, or Renewal Term, if
applicable, Employee fails to perform his duties hereunder because of
physical or mental illness or other incapacity for a period of two
consecutive months, or for 45 days during any 120-day period, Company
3
<PAGE>
shall have the right to terminate this Agreement without further
obligation hereunder except for any bonus amount payable in accordance
with this Section 6(c) and any amounts payable pursuant to disability
plans generally applicable to executive employees. Company shall
provide Employee with notice of commencement of the disability period,
which period cannot commence more than seven (7) days prior to the
date of the notice. If there is any dispute as to whether Employee is
or was physically or mentally disabled under this Agreement, or
whether his disability has ceased and he is able to resume his duties,
such question shall be submitted to a licensed physician agreed upon
by the parties. Employee shall submit to such examinations and
provide information as such physician may request, and the
determination of such physician as to Employee's physical or mental
condition shall be binding and conclusive on the parties. Company
agrees to pay the cost of any such physician's services, tests and
examinations.
(d) DEATH. If Employee dies during the Term, or Renewal Term,
if applicable, this Agreement shall terminate immediately, and the
Employee's legal representatives shall be entitled to receive the base
salary due the Employee through the last day of the calendar month in
which his death shall have occurred and any other death benefits
generally applicable to executive employees.
(e) NON-RENEWAL. If Employee's term of employment is not
renewed by Company as contemplated by Section 2 at the end of the
Term, Company shall pay to Employee the base salary due him through
the end of the Term, less applicable withholdings.
(f) CHANGE OF CONTROL. For purposes of this Agreement (except
to the extent governed or affected by Section 280G of the Internal
Revenue Code of 1986, as amended (the "Code")), "Change in Control"
shall be deemed to have occurred if the conditions set forth in any
one of the following paragraphs shall have been satisfied:
i) Any "person" (as such term is used in Section 13(d) and
14(d)) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act") or "persons" acting in concert, is or becomes the
"beneficial owner" (as defined in Rule 13d-3 under the Exchange
Act), directly or indirectly, of securities of the Company
representing twenty-five percent (25%) or more of the combined
voting power of Company's then outstanding securities, provided
that the term "person" for purposes of this Section 6(f)(i) shall
exclude Company or any trustee or other fiduciary holding
securities under an employee benefit plan of Company; or
ii) The stockholders of Company approve an acquisition
and/or merger or consolidation of Company with any other
corporation, other than (A) an acquisition and/or a merger or
consolidation which would result in the voting securities of
Company outstanding immediately prior thereto continuing to
represent (either by remaining outstanding or by being converted
into voting securities of the surviving entity), in combination
with the ownership of any trustee or other fiduciary holding
securities under an employee benefit plan of Company, at least
seventy percent (70%) of the combined voting power of the voting
securities of Company or such surviving entity outstanding
immediately after such merger or consolidation, or (B) an
acquisition and/or merger or consolidation effected to implement
a recapitalization of Company (or similar transaction) in which
no person acquires more than fifty percent (50%) of the combined
voting power of Company's then outstanding securities; or
4
<PAGE>
iii) The stockholders of Company approve a plan of complete
liquidation of Company or an agreement for the sale or
disposition by Company of all or substantially all Company's
assets.
(g) SEPARATION PAYMENT. i) For purposes of this Agreement,
"Separation Payment" means a payment equal to 2.99 times the
Employee's annual base salary at the time of termination,
subject to the limitations in (6)(g)(ii), below.
ii) If the Separation Payment plus any other severance
benefits or any other payments or benefits received or to be
received by Employee from the Company (whether payable pursuant
to the terms of this Agreement or pursuant to any other plan,
agreement or arrangement with the Company or any corporation
("Affiliate") affiliated with the Company within the meaning of
Section 1504 of the Code (collectively, "Severance Benefits"), in
the opnion of tax counsel selected by the Company and acceptable
to Employee, constitute "parachute payments" within the meaning
of Section 280G (b)(2) of the Code, and the present value of such
"parachute payments" equals or exceeds three times the average of
the annual compensation payable to Employee by the Company (or an
Affiliate) and includable in Employee's gross income for federal
income tax purposes for the five years preceding the year in
which the Employee was terminated without cause under Section
6(b) of this Agreement (including, without limitation, a
termination without cause upon a Change of Control) ("Base
Amount"), if, but only if Employee so elects in writing, such
Severance Benefits shall be reduced to an amount the present
value of which (when combined with the present value of any other
payments or benefits otherwise received or to be received by
Employee from the Company or an Affiliate that are deemed
"parachute payments") is equal to 2.99 times the Base Amount,
notwithstanding any other provision to the contrary in this
Agreement. However, the Severance Benefits shall not be reduced
if in the opinion of such tax counsel, the Severance Benefits (in
their full amount or as partially reduced, as the case may be)
plus all other payments or benefits which constitute "parachute
payments" within the meaning of Section 280G (b)(2) of the Code
are reasonable compensation for services actually rendered,
within the meaning of Section 280G (b)(4) of the Code, and such
payments are deductible by the Company. The Base Amount shall
include every type and form of compensation includable in
Employee's gross income in respect of his employment by the
company (or an Affiliate), except to the extent otherwise
provided in temporary or final regulations promulgated under
Section 280G (b) of the Code. For purposes of this Section 6
(g)(ii), a "change in ownership or control" shall have the
meaning set forth in Section 280G (b) of the Code and any
temporary or final regulations promulgated thereunder. The
present value of any non-cash benefit or any deferred cash
payment shall be determined by the Company's independent auditors
in accordance with the principles of Sections 280G (d)(3) and (4)
of the Code.
iii) Employee shall have the right to request that the
Company obtain a ruling from the Internal Revenue Service
("Service") as to whether any or all payments or benefits
determined by such tax counsel are, in the view of the Service,
"parachute payments" under Section 280G. If a ruling is sought
pursuant to executive's request, no Severance Benefits payable
under this Agreement shall be made to Employee to the extent they
would exceed 2.99 times the Base Amount until after 15 days from
the date of such ruling. For purposes of this Section 6,
Employee
5
<PAGE>
and the Company agree to be bound by the Service's ruling as to
whether payments constitute "parachute payments" under Section
280G. If the Service declines, for any reason, to provide the
ruling requested, the tax counsel's opinion provided with respect
to what payments or benefits constitute "parachute payments"
shall control, and the period during which the excessive portion
of the Severance Benefits may be deferred shall be extended to a
date 15 days from the date of the Service's notice indicating
that no ruling would be forthcoming.
iv) If Section 280G, or any successor statute, is repealed,
this Section 6(g) shall cease to be effective on the effective of
such repeal. The parties to this Agreement recognize that final
regulations under Section 280G of the Code may affect the amounts
that may be paid under this Agreement and agree that, upon
issuance of such final regulations this Agreement may be modified
as in good faith deemed necessary in light of the provisions of
such regulations to achieve the purposes of this Agreement, and
that consent to such modifications shall not be unreasonably
withheld.
7. NON-COMPETITION; CONFIDENTIAL INFORMATION.
(a) CONFIDENTIAL INFORMATION. Employee acknowledges that
Employee may receive, or contribute to the production of, Confidential
Information. For purposes of this Agreement, Employee agrees that
"Confidential Information" shall mean information or material
proprietary to Company or designated as Confidential Information by
Company and not generally known by non-Company personnel, which
Employee develops or of or to which Employee may obtain knowledge or
access through or as a result of Employee's relationship with Company
(including information conceived, originated, discovered or developed
in whole or in part by Employee). Confidential Information includes,
but is not limited to, the following types of information and other
information of a similar nature (whether or not reduced to writing)
related to Company's business: discoveries, inventions, ideas,
concepts, research, development, processes, procedures, "know-how",
formulae, marketing techniques and materials, marketing and
development plans, business plans, customer names and other
information related to customers, price lists, pricing policies,
financial information, employee compensation, and computer programs
and systems. Confidential Information also includes any information
described above which Company obtains from another party and which
Company treats as proprietary or designates as Confidential
Information, whether or not owned by or developed by Company.
Employee acknowledges that the Confidential Information derives
independent economic value, actual or potential, from not being
generally known to, and not being readily ascertainable by proper
means by, other persons who can obtain economic value from its
disclosure or use. Information publicly known without breach of this
Agreement that is generally employed by the trade at or after the time
Employee first learns of such information, or generic information or
knowledge which Employee would have learned in the course of similar
employment or work elsewhere in the trade, shall not be deemed part of
the Confidential Information. Employee further agrees:
i) To furnish Company on demand, at any time during or
after employment, a complete list of the names and addresses of
all present, former and potential customers and other contacts
gained while an employee of Company in Employee's possession,
whether or not in the possession or within the knowledge of
Company;
6
<PAGE>
ii) that all notes, memoranda, documentation and records in
any way incorporating or reflecting any Confidential Information
shall belong exclusively to Company, and Employee agrees to turn
over all copies of such materials in Employee's control to
Company upon request or upon termination of Employee's employment
with Company;
iii) that while employed by Company and thereafter Employee
will hold in confidence and not directly or indirectly reveal,
report, publish, disclose or transfer any of the Confidential
Information to any person or entity, or utilize any of the
Confidential Information for any purpose, except in the course of
Employee's work for Company; and
iv) that any idea in whole or in part conceived of or made
by Employee during the term of his employment, consulting, or
similar relationship with Company which relates directly or
indirectly to Company's current or planned lines of business and
is made through the use of any of the Confidential Information of
Company or any of Company's equipment, facilities, trade secrets
or time, or which results from any work performed by Employee for
Company, shall belong exclusively to Company and shall be deemed
a part of the Confidential Information for purposes of this
Agreement. Employee hereby assigns and agrees to assign to
Company all rights in and to such Confidential Information
whether for purposes of obtaining patent or copyright protection
or otherwise. Employee shall acknowledge and deliver to Company,
without charge to Company (but at its expense) such written
instruments and do such other acts, including giving testimony in
support of Employee's authorship or inventorship, as the case may
be, necessary in the opinion of Company to obtain patents or
copyrights or to otherwise protect or vest in Company the entire
right and title in and to the Confidential Information.
(b) NON-COMPETITION. During the Term, Employee agrees that he
shall not enter into or engage, directly or indirectly, whether on his
own account or as a shareholder (other than as a less than 2%
shareholder of a publicly-held company), partner, joint venturer,
employee, consultant, advisor, and/or agent, of any person, firm,
corporation, or other entity, in any or all of the following
activities:
i) Engaging in Company Business in the United States;
ii) soliciting the past or existing customers, clients,
suppliers, or business patronage of Company or any of its
predecessors, affiliates or subsidiaries, or use any Confidential
Information (as defined in Section 7(a)) for the purpose of, or
which results in, competition with Company or any of its
affiliates or subsidiaries;
iii) soliciting the employment of any employees of Company
or any of its affiliates or subsidiaries; and
iv) promoting or assisting, financially or otherwise, any
person, firm, association, corporation, or other entity engaged
in the Company Business in the United States.
(c) INJUNCTIONS. It is agreed that the restrictions contained
in this Section 7 are reasonable, but it is recognized that damages in
the event of the breach of any of the restrictions will be difficult
or impossible to ascertain; and, therefore, Employee agrees that,
7
<PAGE>
in addition to and without limiting any other right or remedy Company may
have, Company shall have the right to an injunction against Employee issued
by a court of competent jurisdiction enjoining any such breach without
showing or proving any actual damage to Company.
(d) Employee also agrees, acknowledges, covenants, represents
and warrants as follows:
i) That he has read and fully understands the foregoing
restrictions and that he has consulted with a competent attorney
regarding the uses and enforceability of restrictive covenants;
ii) that he is aware that there may be defenses to the
enforceability of the foregoing restrictive covenants, based on
time or territory considerations, and that he knowingly,
consciously, intentionally and entirely voluntarily, irrevocably
waives any and all such defenses and will not assert the same in
any action or other proceeding brought by Company for the purpose
of enforcing the restrictive covenants or in any other action or
proceeding involving him and Company;
iii) that he is fully and completely aware that, and further
understands that, the foregoing restrictive covenants are an
essential part of the consideration for Company entering into
this Agreement and that Company is entering into this Agreement
in full reliance on these acknowledgments, covenants,
representations and warranties; and
iv) that the existence of any claim or cause of action by
him against Company, if any, whether predicated upon this
Agreement or otherwise, shall not constitute a defense to the
enforcement by Company of the foregoing restrictive covenants
which shall be litigated separately.
(e) If period of time and/or territory described above are
nevertheless held to be in any respect an unreasonable restriction
(after giving due consideration to the provisions of Section 7(d)
above), then it is agreed that the court so holding may reduce the
territory to which the restriction pertains or the period of time in
which it operates or may reduce both such territory and such period,
to the minimum extent necessary to render such provision enforceable.
(f) The obligations described in this Section 7 shall survive
any termination of this Agreement or any termination of the employment
relationship created hereunder for the maximum period of time said
obligations may be legally enforced.
8. INVENTIONS AND CREATIONS.
(a) Employee agrees that all inventions, discoveries,
developments, improvements, ideas, distinctive marks, symbols or
phrases, copyrightable creations, works of authorship, mask works and
other contributions including but not limited to software,
advertising, design, artwork, manuals and writings (collectively
referred to as "Creations"), whether or not protectable by statute,
which have been, or are in the future conceived, created, made,
developed or acquired by Employee, either individually or jointly,
while employee is retained by Company and relate in any manner to
Employee's work for Company, the research or business of Company or
fields into which the business of
8
<PAGE>
Company may extend, belong to Company. Employee hereby sells, assigns
and transfers to Company exclusively and irrevocably, without further
compensation, all ownership, title and rights in and to all of the
Creations. Employee further agrees to promptly and fully disclose the
Creations to Company in writing, if requested by Company, and to
execute and deliver any and all lawful applications, assignments and
other documents which Company requests for protecting the Creations in
the United States or any other country. Company shall have the full
and sole power to prosecute such applications and to take all other
actions concerning the Creations, and Employee agrees to cooperate
fully, at the expense of Company, in the preparation and prosecution
of all such applications and any legal actions and proceedings
concerning the Creations.
(b) Employee agrees and warrants that the Creations will be
Employee's original work and will not improperly or illegally
incorporate any material created by or belonging to others.
(c) Employee agrees to and does hereby sell, assign, convey and
transfer to Company any and all manuscripts, programs, writings,
pictorial materials, originals, camera-ready copies, and all drafts
and notes of the Creations, regardless of the media in which they
might exist, and to provide these materials to Company promptly
whenever requested by Company and upon completion of the Agreement,
and to execute documents, give testimony and otherwise cooperate fully
with Company to establish and/or confirm Company's ownership, patent,
copyright and/or trademark rights concerning the Creations.
(d) Without diminishing in any way the rights granted to Company
above, if a Creation is described in a patent, copyright or trademark
application, or is disclosed to a third party by Employee within two
(2) years after Employee's employment with Company is terminated,
Employee agrees that it is to be presumed that the Creation was
conceived, created, made, developed or acquired by Employee during the
period of his employment with Company, unless Employee can prove
otherwise by clear and convincing evidence.
9. GOVERNING LAW AND VENUE. Arizona law shall govern the
construction and enforcement of this Agreement and the parties agree that
any litigation pertaining to this Agreement shall be in courts located in
Maricopa County, Arizona.
10. CONSTRUCTION. The language in all parts of this Agreement shall
in all cases be construed as a whole according to its fair meaning and not
strictly for nor against any party. The Section headings contained in this
Agreement are for reference purposes only and will not affect in any way
the meaning or interpretation of this Agreement. All terms used in one
number or gender shall be construed to include any other number or gender
as the context may require. The parties agree that each party has reviewed
this Agreement and has had the opportunity to have counsel review the same
and that any rule of construction to the effect that ambiguities are to be
resolved against the drafting party shall not apply in the interpretation
of this Agreement or any amendment or any exhibits thereof.
11. NONDELEGABILITY OF EMPLOYEE'S RIGHTS AND COMPANY ASSIGNMENT
RIGHTS. The obligations, rights and benefits of Employee hereunder are
personal and may not be delegated, assigned or transferred in any manner
whatsoever, nor are such obligations, rights or benefits subject to
involuntary alienation, assignment or transfer. Upon reasonable notice to
Employee, Company may transfer Employee to an affiliate of Company, which
affiliate shall assume the obligations of Company under this Agreement.
This Agreement shall be assigned automatically to any entity merging with
or acquiring Company or its business.
9
<PAGE>
12. ASSIGNMENT. This Agreement and the respective rights, duties and
obligations of Employee hereunder may not be assigned or delegated by
Employee.
13. SEVERABILITY. In the event any term or provision of this
Agreement is declared by a court of competent jurisdiction to be invalid or
unenforceable for any reason, this Agreement shall remain in full force and
effect, and either (a) the invalid or unenforceable provision shall be
modified to the minimum extent necessary to make it valid and enforceable
or (b) if such a modification is not possible, this Agreement shall be
interpreted as if such invalid or unenforceable provision were not a part
hereof.
14. ATTORNEYS' FEES. Except as otherwise provided herein, in the
event any party hereto institutes an action or other proceeding to enforce
any rights arising out of this Agreement, the party prevailing in such
action or other proceeding shall be paid all reasonable costs and
attorneys' fees by the non-prevailing party, such fees to be set by the
court and not by a jury and to be included in any judgment entered in such
proceeding.
15. CONSIDERATION. It is expressly understood and agreed that this
document sets forth the entire consideration for this Agreement, and that
said consideration for this Agreement is contractual and not a mere
recital.
16. CONSTRUCTION. This Agreement is a negotiated agreement and any
documents delivered pursuant hereto shall be construed without regard to
the identity of the persons or entities who or which drafted the various
provisions thereof. Every provision of this Agreement and such other
employment-related documents shall be construed as though all parties
participated equally in the drafting thereof. Any legal rule of
construction that a document is to be construed against the drafting party
shall not be applicable and is expressly waived by Company and Employee.
17. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, all such counterparts shall be deemed to constitute one and
the same instrument, and each of said counterparts shall be deemed an
original hereof.
18. CAPTIONS. The captions used in this Agreement are inserted for
convenience only and shall not affect the meaning or construction of this
Agreement.
19. NOTICES. All notices required or permitted hereunder shall be
in writing and shall be deemed duly given upon receipt if either personally
delivered, sent by certified mail, return receipt requested, or sent by a
nationally-recognized overnight courier service, addressed to the parties
as follows:
If to Company: Renaissance Group International, Ltd.
------------- 7501 N. 16th Street, Suite 200
Phoenix, Arizona 85020
Attn: President
If to Employee: William D. O'Neal
-------------- 4213 North Tabor Street
Mesa, Arizona 85215
or to such other address as any party may provide to the other in
accordance with this Section.
10
<PAGE>
20. ENTIRE AGREEMENT. This Agreement constitutes the entire
agreement between the parties with respect to the subject matter hereof
(i.e., Employee's employment by Company) and supersedes all prior or
contemporaneous understandings or agreements in regard thereto; provided,
however, that (except as otherwise set forth herein) this Agreement shall
not affect or supersede any rights of Company under any other contracts or
other agreements between or otherwise involving the parties, any
restrictive covenants or any similar agreements. No modification or
addition to this Agreement shall be valid unless in writing, specifically
referring to this Agreement and signed by all parties hereto. No waiver of
any rights under this Agreement shall be valid unless in writing and signed
by the party to be charged with such waiver. No waiver of any term or
condition contained in this Agreement shall be deemed or construed as a
further or continuing waiver of such term or condition, unless the waiver
specifically provides otherwise.
IN WITNESS WHEREOF, the parties have executed this Agreement on the
15th day of August, 1997.
RENAISSANCE INTERNATIONAL GROUP, EMPLOYEE:
LTD, a Nevada corporation
By: /s/ TENNESSEE WEBB /s/ WILLIAM D. O'NEAL
-------------------------------- ---------------------------------
Its: President William D. O'Neal
------------------------------
11
EXHIBIT 10(vi)
MEMORANDUM OF UNDERSTANDING & AGREEMENT
---------------------------------------
This Agreement is entered into by and between Renaissance
International Group, Ltd. (the "Company") a Nevada corporation, with its
corporate office located at 7501 North 16th Street, Suite 200, Phoenix,
Arizona 85020 and Tennessee Webb ("Consultant") with his office located at
9598 East Shangri-La, Scottsdale, Arizona 85260, this 16th day of March,
1998.
1. Company hereby retains the services of Consultant for a period of
one year (the "Term"), at the rate of one hundred and ten thousand dollars
($110,000) per year, payable in twelve (12) equal installments, at the
beginning of each month, commencing April 1, 1998 and expiring May 30,
1999, unless extended beyond or earlier terminated, pursuant to the terms
hereinafter set out.
2. Consultant hereby accepts such engagement to Company and its
wholly owned subsidiaries, as may be designated by the Executive Committee
from time to time, pursuant to the consideration as set out in paragraph 1
above and subject to the terms and conditions hereinafter set out.
TERMS AND CONDITIONS
--------------------
1. The terms of this Agreement create an independent contractor
status and Consultant has no authority to bind the Company in any matters
of any nature or kind whatsoever. Company understands and agrees that it
shall provide Consultant with guidance, assistance and direction, however,
it shall place no restrictions as to time and work place of Consultant.
2. No later than six (6) months from the date of this Agreement,
Consultant shall, in consultation with the President, C.E.O. of Renaissance
CenteR, Ltd., and with guidance, advice and direction from the Executive
Committee of the Company, develop, draft and deliver to the Executive
Committee a critical path business plan of operations for Renaissance
CenteR, Ltd., including but not limited to; development of strategic
partners, potential acquisitions, marketing and placement of Renaissance
CenteR, Ltd.'s design capabilities in the multi-media industry, alternative
applications for technology and necessary funding requirements.
3. In addition, Consultant shall provide negotiation services as the
Executive Committee may, from time to time, deem necessary and beneficial
to the Company.
4. Further, as additional consideration, Company will pay to
Consultant, on a project by project basis, a sum to be determined by the
Executive Committee for Consultant's efforts in bringing to the Company,
acquisitions, joint-ventures and/or strategic alliances in advancement of
the Company's business. This is in addition to the consideration as set
out in paragraph 1 above.
Page 1 of 2
<PAGE>
5. Company shall reimburse Consultant for only those expenses pre-
approved by Company and upon submission of proper receipts, except that
Consultant shall have the authority to incur reasonable expenses up to
$250.00 in the aggregate on behalf of Company without pre-approval.
6. Company shall review with Consultant his work product with respect
to the business plan for Renaissance CenteR, Ltd. upon the expiration of
the first six (6) months of the Term. Based upon such fair and reasonable
review, Company shall either: a) increase the consideration as set out in
paragraph 1 above; b) decrease the consideration as set out in paragraph 1
above; c) leave unchanged the considerations as set out in paragraph 1
above; or d) give Consultant thirty (30) days notice, inclusive of monthly
installment, terminating this Agreement.
7. Consultant understands and agrees that any and all work product
created hereunder shall be and remain the property of the Company and this
paragraph shall survive the termination or expiration of this Agreement,
whichever may be earlier.
8. Consultant acknowledges the confidential and proprietary nature of
the Company, and shall sign such non-disclosures, confidentiality and
non-circumvent documents as in-house counsel for the Company may deem
necessary.
9. Company acknowledges that Consultant is an independent contractor
and is solely responsible for the payment of his own withholding, and any
other applicable federal or state taxes and/or benefits, and is free to
consult and advise such third parties as he may determine, provided that
such parties are not in direct competition with Company.
Read, agreed and accepted this 16th day of March, 1998.
"COMPANY" "CONSULTANT"
Renaissance International Group, Ltd.,
a Nevada corporation
By: /s/ KEVIN JONES /s/ TENNESSEE WEBB
---------------------------------- ---------------------------------
Its: President Tennessee Webb
---------------------------------
Page 2 of 2
EXHIBIT 10(vii)
Via Facsimile
- -------------
February 3, 1998
Dean Norris
MDI of Arizona
15229 N. 52nd Pl.
Scottsdale, AZ 85252
Fax: 494-8338
RE: Offer for Independent Contractor Services
Dear Dean:
The following sets forth our mutual understanding upon which MDI of Arizona
("MDI") shall render independent contractor services to Renaissance
International Group, Ltd., an Arizona corporation ("RIGL") in connection
with the evaluation, management and marketing of medical practitioners for
RIGL's management service organization network.
The term of this agreement will commence upon the date hereof and shall
terminate on the 31st day of July, 1998 (the "Term"). On the first day of
each month of the Term, RIGL shall pay to MDI a fee in the amount of
$10,000 in consideration for MDI's services. Such services shall include,
but shall not be limited to, locating and evaluating physician practices
for purposes of inclusion into RIGL's management service organization
network. In addition, MDI shall provide day to day management and
marketing services to those physician practices which affiliate with RIGL's
management service organization network.
RIGL shall provide MDI with a marketing budget of $12,500. RIGL shall have
the right to pre-approve any expenditures with respect to this budget, and
shall have the right to approve any marketing and advertising materials
developed by MDI.
RIGL shall pay MDI's reasonable and necessary expenses up to $4,000 per
month during the Term. All expenses must be pre-approved by RIGL and
receipts must be submitted to RIGL to obtain reimbursement.
For each physician practice that MDI affiliates with the management service
organization network, MDI shall receive 4,000 shares of common stock of
RIGL, along with an additional fee of $500 per month. In the event that
MDI is successful in affiliating at least thirty (30) physician practices
with the management services organization network during the Term, RIGL
shall purchase MDI for shares of common stock of RIGL at a price which
shall be determined by a third party independent evaluation at the end of
the Term. In the event RIGL purchases MDI, MDI's principals shall be
offered employment contracts with RIGL on terms commensurate with those of
other executives of RIGL.
<PAGE>
If the above terms set forth your understanding, please countersign below.
Once executed, this agreement shall constitute a legally binding contract
between the parties hereto, and enforceable under the laws of the State of
Arizona.
We look forward to working with you. If you have any questions, please do
not hesitate to contact the undersigned.
In this we remain,
Renaissance International Group, Ltd. Accepted and Agreed to:
MDI of Arizona
/s/ WILLIAM D. O'NEAL /s/ DEAN NORRIS
per: -------------------------------- ---------------------------------
William D. O'Neal, VP of Business By: Dean Norris
Affairs/General Counsel Its President
EXHIBIT 10(viii)
Via Facsimile
- -------------
February 5, 1998
Herr Martin Neumann
Wallbergstr. 3
82024 Taufkirchen
Germany
RE: Offer to Purchase Medasys System/Independent Contractor Relationship
Dear Herr Neumann:
We are pleased to make the following offer to you to purchase the worldwide
exclusive rights (exclusive of Germany, Austria, and Switzerland) to your
Medasys system.
1. You shall a receive a cash payment of $65,000 US, along with shares of
common stock of Renaissance International Group, Ltd. ("RIGL") equal
in value to $500,000 US, in consideration for your irrevocable
assignment of all right, title and interest in and to the perpetual
worldwide exclusive rights (excluding Germany, Austria and
Switzerland) to your medical software system known as "Medasys". The
value of the shares shall be determined by averaging the highest bid
and ask price on the OTC Electronic Bulletin Board Trading System
during the period commencing upon the execution of this agreement and
terminating upon the end of trading of the twentieth day thereafter.
Fifty percent (50%) of the shares you receive shall be restricted from
transfer for a period of two (2) years, and the remaining fifty
percent (50%) of the shares you receive shall be restricted from
transfer for a period of one year from the date of issuance.
2. RIGL shall also engage you, initially upon an independent contractor
basis, to assist with the further development and translation of the
Medasys system, with the intention of integrating you as an employee
into our company once we are able to obtain an United States work visa
on your behalf. Your independent contractor relationship shall be for
a term of three (3) years commencing upon your acceptance of this
agreement, with the understanding that said agreement shall form the
basis of an employment agreement at such time RIGL is able to obtain
the required work permit in the U.S. At such time, you shall be
entitled to all the benefits associated with employee status,
including medical and dental insurance and participation in the
company retirement plan. While an independent contractor, you shall
receive $5,000 US per month for your services. Further, you will be
entitled to a bonus equal to four percent (4%) of the first $1,000,000
of net income generated from site/server licenses, and thereafter
three percent (3%) of net income generated from site/server licenses
until you have received a total of $255,000. You shall then receive
a bonus of one percent (1%) of the net income generated from
site/server licenses for an additional seven (7) years. Such payments
shall be made within ninety (90) days of year end. In addition, RIGL
shall pay all reasonable travel expenses to and from the United
States, along with expenses related to your accommodations and meals
during your stay in Arizona. As an independent contractor, you shall
remain responsible for the payment of all applicable taxes and
withholding until such time as you become an employee of RIGL.
<PAGE>
If the terms of this agreement are acceptable to you, please countersign
below and return an executed copy to care of the undersigned. We shall
prepare a formal assignment document setting forth the above terms, and
other standard and customary terms mutually acceptable to the parties. The
effectiveness of this agreement and subsequent assignment shall be
contingent upon approval of the Board of Directors of RIGL.
In the interim, if you have any questions, please do not hesitate to
contact the undersigned. We look forward to working with you.
In this we remain,
Renaissance International Group, Ltd.
Per: /s/ WILLIAM D. O'NEAL
----------------------------------
William D. O'Neal, VP of Business
Affairs/General Counsel
CC: Tennessee Webb
Walter Vogel
Read, accepted and understood this
6th day of February, 1998
/s/ MARTIN NEUMANN
---------------------------------
Martin Neumann
EXHIBIT 21(i)
Subsidiaries of the Registrant
Renaissance Medtech, Ltd. a Nevada corporation.
Renaissance ASD, Ltd. a Nevada corporation.
Renaissance Center, Ltd. a Nevada corporation.
Renaissance Center, Inc., a California corporation.
EXHIBIT 23(i)
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANT
I consent to the inclusion in the Form 10-SB, of Renaissance
International Group, LTD. dated on or about April 30, 1998 of my audit
report dated January 6, 1998 with respect to the financial statements of
Renaissance International Group, LTD. as of September 30, 1997 and 1996
and for the three years ended September 30, 1997.
/s/ BILLIE J. ALLRED
Pima, Arizona
April 30, 1998
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1
<CURRENCY> U.S. DOLLARS
<S> <C> <C>
<PERIOD-TYPE> 12-MOS 3-MOS
<FISCAL-YEAR-END> SEP-30-1997 SEP-30-1998
<PERIOD-START> OCT-01-1996 OCT-01-1997
<PERIOD-END> SEP-30-1997 DEC-31-1997
<EXCHANGE-RATE> 1 1
<CASH> 841,072 2,064,289
<SECURITIES> 0 0
<RECEIVABLES> 0 0
<ALLOWANCES> 0 0
<INVENTORY> 0 0
<CURRENT-ASSETS> 847,044 2,069,828
<PP&E> 87,510 106,200
<DEPRECIATION> (15,814) (23,172)
<TOTAL-ASSETS> 1,119,119 2,357,957
<CURRENT-LIABILITIES> 32,526 253,700
<BONDS> 0 0
0 0
2,299,100 0
<COMMON> 370,742 4,075,972
<OTHER-SE> (1,583,249) (1,971,685)
<TOTAL-LIABILITY-AND-EQUITY> 1,119,119 2,357,957
<SALES> 36,542 1,582
<TOTAL-REVENUES> 36,542 1,582
<CGS> 10,542 0
<TOTAL-COSTS> 1,249,995 378,951
<OTHER-EXPENSES> 16,626 26,936
<LOSS-PROVISION> 0 0
<INTEREST-EXPENSE> 0 0
<INCOME-PRETAX> (1,222,646) (388,436)
<INCOME-TAX> 0 0
<INCOME-CONTINUING> (1,222,646) (388,436)
<DISCONTINUED> 0 0
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> (1,222,646) (388,436)
<EPS-PRIMARY> (0.17) (0.04)
<EPS-DILUTED> (0.17) (0.04)
</TABLE>
