SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15 (d) of
The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): July 15, 1999 (July 9, 1999)
WORLD HOUSE ENTERTAINMENT, INC.
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(Exact Name of Registrant as specified in its charter)
Nevada 333-51683 87-0567884
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(State or other jurisdiction) (Commission file number) (IRS Employer ID No.)
2831 Dogwood Place, Nashville, Tennessee 37204
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(address of principal executive offices) (zip code)
(615) 269-8682
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(Registrant's telephone number,
including area code)
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Item 1. Changes in Control of Registrant
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(a) On July 9, 1999 American Deductible, Inc. acquired 9,358,000 shares of
Registrant's common stock ("restricted securities") from the Registrant pursuant
to a merger between Registrant and 800 America, Inc., a Delaware corporation.
American Deductible, Inc. is a trust established for the benefit of the children
of Elie Rabi, the founder and President of 800 America, Inc. As a part of such
merger, the shareholders of 800 America, Inc., including American Deductible,
Inc. exchanged all of their shares of common stock of 800 America, Inc. for
restricted common stock of Registrant. See Item 2 Acquisition or Disposition of
Assets below. Mr. Rabi does not act as trustee of the trust but holds a power of
attorney on behalf of the trust and may be deemed to hold direct voting control
of such shares. The restricted common stock of Registrant held by the trust is
as follows:
Name Number of Shares Percent of Class
---- ---------------- ----------------
American Deductible, Inc. 9,358,000 78.3%
The former controlling stockholders of the Registrant and their percentage
of ownership of the outstanding voting securities of the Registrant prior to the
above described acquisition of shares pursuant to merger were:
Amount and Nature of Percent of
Name Beneficial Ownership(1) Class
---- ----------------------- -----
Elizabeth Ann Peters 500,000 25.6%
Brenda M. Hall 525,000 26.9%
Peterson & Sons Holding Company 342,500 17.6%
(1) reflects two and one half for one forward split of shares which occurred
immediately prior to merger with 800 America, Inc.
The basis of control of American Deductible, Inc. and, indirectly, Mr. Rabi
acting on behalf of the trust established for the benefit of his children, is
stock ownership.
(b) The following table contains information regarding share holdings of
the Registrant's directors and executive officers and those persons or entities
who beneficially own more than 5% of the Registrant's common stock.
Amount and Nature Percent
of of
Name Title Beneficial Ownership Class
---- ----- -------------------- -----
Elie Rabi President and Treasurer 9,358,000(1) 78.3%
and Director
Ruth E. Walley Secretary 0 0
Bobby Walley Director 23,000 *
Darvin Pierce Director 23,000 *
All officers and directors
as a group 9,404,000 78.7%
*less than one percent
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(1) Beneficial share ownership is in the name of American Deductible, Inc.
(9,358,000 shares of common stock), a trust established for the benefit of the
children of Mr. Rabi. Mr. Rabi does not act as trustee of the trust but has a
power of attorney to act on behalf of said trust and may be deemed to have
direct voting control of such common stock.
There are no arrangements or understandings among members of both the
former and new control groups and their associates with respect to election of
directors or other matters.
Item 2. Acquisition or Disposition of Assets
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On July 9, 1999 World House Entertainment, Inc. ("Registrant") merged with
800 America, Inc. ("America") pursuant to an Agreement and Plan of Merger (the
"Merger Agreement") and issued in the aggregate 10,000,000 shares of its
restricted common stock to the three shareholders of America. See Item 1 above.
Pursuant to the terms of the Merger Agreement, Registrant remains as the
surviving corporation and, following the closing of the Merger, is now in the
process of changing its name to 800 AMERICA.COM, Inc. Following completion of
the Merger, the new shareholders of Registrant now own 10,000,000 out of
11,950,000 total shares issued and outstanding, or 83.7%. Under the terms of the
Merger Agreement which was approved by the shareholders of Registrant, the
Registrant's wholly owned and only operating subsidiary, Songs For The Planet,
Inc. was purchased by Elizabeth Peters, the Company's former President, for Ten
Dollars and other good and valuable consideration and all debt owed by Songs For
The Planet, Inc. to Registrant was forgiven as of the closing date of the
Merger.
Closing of the transaction was subject to shareholder approval of both
Registrant and America. Proxies were not solicited by Registrant. Instead,
Registrant obtained shareholder approval by written consent as provided under
Section 78.320 of the Nevada General Corporation Law. The current shareholders
of the Registrant who did not join in the above described consent may dissent
and obtain fair value for their shares as provided by the Nevada General
Corporation Law. Registrant does not expect any shareholders of Registrant to
exercise their dissenter's rights. No registration statement will be filed
covering the issuance of shares to the America shareholders because Registrant
believes such issuance is exempt from the registration requirements of the
Securities Act of 1933 by virtue of Rule 506 and Section 4(2) of the Act.
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America was formed as a Delaware corporation on March 26, 1999 for the
purpose of operating a shopping mall web site. America derives revenue from two
sources: (1) an annual $10.00 membership fee is charged to members that entitles
such members to shop on-line at America's web site. The web site allows members
access to over one hundred fifty stores, including many nationally known and
recognized retailers, and offers such members a rebate of from 3% to 10% on
purchases made through the web site; (2) rent and commission fees from the
merchants and retailers whose stores are represented at America's web site.
Rents vary between one hundred and two hundred dollars per month per retailer
and commissions are based upon the volume of sales from members. America's
assets consist of a web site, equipment, fixtures and a membership/subscriber
base that numbers approximately 70,000. America's executive offices are located
at 1200 South Mount Juliet Road (mailing address P.O. Box 291029), Nashville, TN
37229, (888) 855-9872.
Registrant determined that the proposed transaction with America would
significantly increase Registrant's revenue and income generating potential and
gain Registrant access to the exploding internet market for on-line shopping.
There is no relationship between Registrant or its affiliates, officers or
directors and America or its affiliates, officers and directors.
The exchange ratio provided for in the Merger Agreement of 6,666.67 shares
of Registrant's common stock for each share of America common stock was arrived
at by arms length negotiation based upon the revenues, income and potential for
growth of America as of the time the transaction was negotiated.
The Registrant intends to continue the business of America in the same
manner as prior to the Merger.
Item 6. Resignations of Directors and Executive Officers.
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Effective July 9, 1999 and as required by the terms of the Merger Agreement
between Registrant and 800 America, Inc., Elizabeth Ann Peters and Benjamin
Justin Peters resigned as directors and executive officers of the Registrant and
the persons listed above under Item 1(b) were designated to serve as directors
and executive officers until their successors are elected and qualified or until
their prior resignations or terminations.
Item 7. Financial Statements and Exhibits.
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(a) Financial Statements
Audited financial statements of 800 America, Inc. are filed herewith.
(b) Pro forma Financial Statements
Pro forma financial information of Registrant and America will be
filed by amendment not later than sixty days from the date of this report.
(c) Exhibits
2.04 Agreement and Plan of Merger
3.011 Articles of Merger
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SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934, as
amended, the Registrant has caused this report to be signed on its behalf by the
undersigned duly authorized officer.
World House Entertainment, Inc
(Registrant)
Dated: July 15, 1999 By: /s/ Elie Rabi
---------------------------------
Elie Rabi, President
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Jack F. Burke Jr.
Certified Public Accountant
P. 0. Box 15278
Hattiesburg, Ms. 39404
Report of Independent Accountant
The Board of Directors
800 America Inc.
P. 0. Box 291029
Nashville, TN 37229
I have audited the accompanying balance sheet of 800 America Inc., a Delaware
Corporation, as of May 31, 1999 and the related statements of income,
stockholder's equity and cash flows for the two months then ended. These
financial statements are the responsibility of the Company's management. My
responsibility is to express an opinion on these financial statements based on
my audit.
I conducted my audit in accordance with generally accepted auditing standards.
Those 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 audit provides a reasonable basis for my opinion.
In my opinion, the financial statements referred to above present fairly, in all
material respects, the financial position of 800 America Inc. at May 31, 1999
and the results of its operations and its cash flows for the two months then
ended in conformity with generally accepted accounting principles.
Sincerely,
/s/ Jack F. Burke, Jr.
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Jack F. Burke, Jr.
June 16, 1999
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800 America Inc.
Balance Sheet
May 31, 1999
Assets
Current Assets
Cash and Cash Equivalents $ 5,069
Accounts Receivable 87,300
Less Allowance for Doubtful Accounts (13,095)
---------
Total Current Assets 79,274
---------
Property and Equipment
Equipment 76,500
Software 13,899
Furniture and Fixtures 10,000
Web Site 10,000
Subscriber Base 37,000
Accumulated Depreciation and
Amortization (5,221)
---------
Net Property and Equipment 142,178
---------
Total Assets 221,452
=========
Liabilities and Stockholders Equity
Current Liabilities
Account Payable 22,424
Accrued Salaries 29,180
Income Taxes Payable 21,400
Customer Rebates Payable 72,000
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Total Current Liabilities 145,004
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Stockholders Equity
Common Stock 1,500 shares no par common
Authorized and Issued 300
Retained Earnings 76,148
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Total Stockholders Equity 76,448
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Total Liabilities and Stockholders Equity $ 221,452
=========
The Accompanying "Notes to Financial Statements"
Are An Integral Part of These Financial Statements
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800 America Inc.
Statement of Operations
Two Months Ended May 31,1999
Income $ 234,940
---------
Operating Expenses
Salaries 32,230
Depreciation 5,221
Insurance 2,100
Printing 2,465
Rent 2,000
Telephone 2,017
Graphics 1,150
Travel 2,201
Office 1,913
Professional Fees 1,000
Customer Rebates 72,000
Bad Debts 13,095
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Total Expenses 137,392
--------
Net Operating Income 97,548
Income Tax Expense 21,400
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Net Income $ 76,148
========
The Accompanying "Notes to Financial Statements"
Are An Integral Part of These Financial Statements
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800 America Inc.
Analysis of Stockholders Equity
Two Months Ended May 31,1999
Capital Retained
Stock Earnings
----- --------
Stock Issued March 26, 1999 $300
Net Profit $76 148
---- -------
Balance May 31, 1999 300 $76 148
---- -------
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800 America Inc.
Statement of Cash Flows
Two Months Ended May 31,1999
Cash Flows From Operating Activities
Net Income $ 76,148
Adjustment to Reconcile Net Income to
Net Cash From Operating Activities
Deprecation and Amortization 5,221
Accounts Receivable - Increase (87,300)
Accounts Payable - Increase 51,604
Income Tax Payable 21,400
Customer Rebates ) Payable 72,000
Allowance for Doubtful Accounts 13,095
---------
Net Cash Used by Operating Activities 152,168
---------
Cash Flows from Investing Activities
Furniture and Fixtures Purchase 10,000
Web Site - Purchase 10,000
Subscribers Base - Purchase 37,000
Equipment - Purchase 76,500
Software - Purchase 13,899
---------
Net Cash Provided by Investing Activities (147,399)
---------
Cash Flows from Financing Activities
Common Stock Issued 300
---------
Net Cash Provided by Financial Activities 300
---------
Net Increase in Cash and Cash Equivalents 5,069
Cash and Cash Equivalents Beginning 0
---------
Cash and Cash Equivalents Ending $ 5,069
=========
The Accompanying "Notes to Financial Statements'"
Are An Integral Part of These Financial Statements
<PAGE>
800 America Inc.
Notes to Financial Statements
Note I Significant Accounting Policies
Nature of Operations - 800 America Inc., a Delaware Corporation, is an online
rebate shopping mail located in Nashville Tennessee. The company consist of
stores from all parts of the country ranging from some of the largest and best
known stores to some of the smaller regional stores and shoppers (subscribers).
Each store in the mal offers a rebate on all purchases ranging from three to ten
percent based on each store's policy. Upon proof of purchase from the subscriber
the company accrues the rebate expense and files for a refund with the selling
store. The company records the refund as income when received. The company has
been in full operation for two months (April and May 1999) with partial
operations during a development period in February and March 1999. The
development period was conducted by a related company (see Note 3 Capitalization
of Assets - Related Parties).
Cash and Cash Equivalents - The company's cash consist of an unrestricted
checking account. Cash equivalents are defined as short term instruments with an
original maturity date of three months or less. The company does not have any
cash equivalents.
Account Receivable - The company in its two months of operations has acquired
accounts receivables balances of $87,300 which consist primarily of subscribers
fees. As of May 31, 1999 all subscriptions will be required to be paid by credit
card. A 15% allowance for doubtful accounts has been established on the existing
balance.
Accounts Payable - Consist of normal trade accounts and amount to $22,424.
Accrued Salary - Due to officer - employee $20,000 and other employees $9,180.
Income Taxes - The company accounts for income taxes under Statement of
Financial Accounting Standards No. 109, Accounting for Income Taxes (SFAS 109).
SFAS 109 is an asset and liability approach that requires the recognition of
deferred tax assets and liabilities for the expected future tax consequences of
events that have been recognized in the company's financial statements or tax
returns. In estimating future tax consequences, SFAS 109 generally considers all
expected future events other than the enactment of changes in the tax law or
rates. Income tax due is estimated at $21,400. There are no accounting
differences in book and tax accounting or between statutory and effective tax
rates expected at year end. The allowance for bad debts, $13,095, approximates
the estimated amount of specific bad debt charge off for tax purposes at year
end.
<PAGE>
Use of Estimates - The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the amounts reported in the financial statements and
accompanying notes. Actual results could differ from these estimates.
Comparative Financial Statements - The company was incorporated at March 26,
1999 therefore there are no prior periods to be compared and these are not
comparative statements.
Other Comprehensive Income - There are no attributes of other comprehensive
income. Comprehensive income and net income are the same.
Property and Equipment - Property and equipment were recorded at cost (see Note
3) and depreciated on the straight line basis over their estimated useful lives
ranging from three to five years.
Operating Lease - The company's lease on its location will expire October
31,1999. The company pays one thousand dollars ($ 1,000) per month. Lease
payments to date are two thousand dollars ($2,000) with five thousand dollars
($5,000) due over the remainder of the lease period.
Note 2 Fair Value of Financial Instruments
Cash and Cash Equivalents - The carrying amount reported in the Balance Sheet
for cash and cash equivalents approximate its fair value.
Accounts Receivable, Accounts Payable and Customer Rebate Payables - The
carrying amount of accounts receivable, accounts payable and customer rebates
due in the Balance Sheet approximate fair value.
Note 3 Capitalization of Assets Related Parties
The company underwent a development period during February and March 1999 during
which a related party, Internet Web Guide Inc., developed the web site and
collected income from subscribers and from stores, who pay monthly rentals. The
company and Internet Web Guide Inc. agreed that Internet Web Guide Inc.'s cost
for developing the web site was $10,000.
<PAGE>
The company entered into an agreement with Internet Web Guide, Inc. to purchase
the web site and other assets from Internet Web Guide, Inc. for the approximate
income collected from the development period ($127,000). The purchase price was
allocated as follows:
Equipment $ 70,000
Fixtures 10,000
Web Site 10,000
Subscriber Base 37,000
--------
Total $127,000
Note 4 Revenues Recognition
The company receives revenue from individual subscribers, ten dollars ($IO) per
year, and from the stores that make up the shopping mall paying monthly rent
ranging from one hundred ($100) to two hundred ($200) dollars per month. Except
for the development period the new subscribers have been relatively level from
month to month and this is expected to continue.
AGREEMENT AND PLAN OF MERGER
THIS AGREEMENT AND PLAN OF MERGER (the "Agreement"), is dated as of June
29, 1999 and entered into by and between World House Entertainment, Inc. a
Nevada corporation ("World House"), and 800 America, Inc. a Delaware corporation
("America").
RECITALS
Whereas, World House and America and their respective Boards of Directors
deem it advisable to merge America into World House, as herein contemplated,
pursuant to which merger the holders of shares of common stock of America (the
"America Shares"), will receive, in the aggregate, 10,000,000 shares of common
stock of the surviving corporation (the "Surviving Shares") and the name of
World House will be changed to 800 america.com, Inc.;
Whereas, the merger provided for hereby (the "Merger") shall be consummated
in accordance with the terms and conditions hereof and shall be consummated as
of the close of business on the latter of the day on which the duly executed
Certificate of Merger pursuant to Section 252 of the Delaware General
Corporation Law has been duly filed with the Secretary of State of the State of
Delaware or the day on which the duly executed Agreement pursuant to Section
78.485 of the Nevada General Corporation Law has been duly filed with the
Secretary of State of the State of Nevada (the "Effective Date"); it being
understood that the parties shall endeavor to cause the Effective Date to occur
on the same day as the date of the closing of this Agreement (the "Closing
Date").
Whereas, the surviving corporation will issue and deliver to an exchange
agent mutually designated by World House and America (the "Exchange Agent") the
Surviving Shares necessary to effect the exchange of the issued and outstanding
America Shares for Surviving Shares and the exchange of the issued and
outstanding World House Shares for Surviving Shares; and
Whereas, World House and America intend that the Merger shall be recognized
as a tax-free reorganization under the provisions of the Internal Revenue Code
of 1986, as amended (the "Code");
Now Therefore, in consideration of the mutual benefits to be derived from
this Agreement and the provisions hereinafter contained, World House and America
agree as follows:
<PAGE>
ARTICLE ONE
MERGER
Section 1.1. Agreement.
World House and America agree to effect the Merger, subject to the terms
and conditions hereof.
Section 1.2. Surviving Corporation
On the Effective Date, America shall be merged into World House, which
latter company shall be the surviving corporation, the name of which shall be
changed to 800 america.com, Inc. World House as it exists immediately after the
Effective Date is hereinafter referred to as the "Surviving Corporation".
Section 1.3. Certificate of Incorporation, etc. of Surviving Corporation.
From and after the Effective Date and until duly changed or amended:
(i) the Certificate of Incorporation of World House in effect on the
Effective Date shall be restated in its entirety as agreed to in writing by
World House and America prior to the Closing Date and thereafter shall be the
Certificate of Incorporation of the Surviving Corporation;
(ii) The Bylaws of World House shall be restated in their entirety as
agreed to in writing by World House and America prior to the Closing Date and
thereafter shall be the Bylaws of the Surviving Corporation; and
(iii) The directors of the Surviving Corporation shall be the following
persons:
Section 1.4. Effect of the Merger.
When the Merger shall have become effective pursuant to the Delaware
General Corporation Law and the Nevada General Corporation Law as herein
provided, the separate existence of America shall cease and America shall be
merged into World House. The Surviving Corporation shall have all the rights,
privileges, immunities and powers and shall be subject to all the duties and
liabilities of a corporation organized under the Nevada General Corporation Law,
and shall, in addition, have all the rights, immunities and powers of each of
World House and America. The Surviving Corporation shall thereupon and
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thereafter possess all the rights, privileges, immunities and franchises, of a
public nature, of each of World House and America. All property, real, personal
and mixed, and all debts due on whatever accounts, including subscriptions to
shares, and all other choses in action, and all and every other interest, of or
belonging to or due to each of World House and America, shall be taken and
deemed to be transferred to and vested in the Surviving Corporation without
further act or deed. The title to any real estate, or any interest therein,
vested in any of such corporations shall not revert or be in any way impaired by
reason of the Merger. The Surviving Corporation shall thereafter be responsible
and liable for all the liabilities and obligations of each of World House and
America, and any claim existing or action or proceeding pending by or against
either of such corporations may be prosecuted as if the Merger had not taken
place or the Surviving Corporation may be substituted in its place. Neither the
rights of creditors nor any liens upon the property of either such corporation
shall be impaired by the Merger.
ARTICLE II
EFFECT OF MERGER ON WORLD HOUSE SHARES AND AMERICA SHARES
Section 2.1 Conversion.
The manner and basis of converting the World House Shares and the America
Shares in the Merger shall be hereafter set forth in this Article II.
Section 2.2. Conversion of America Shares.
Each of the America Shares issued and outstanding on the Effective Date
(excluding America Shares, if any, held in the treasury of America which shall
be treated in the manner set forth in Section 2.6 hereof), and all rights in
respect thereof, shall on the Effective Date, without any action on the part of
any holder thereof, forthwith cease to exist and be converted into and become
exchangeable for 6,666.66 Surviving Shares, validly issued, fully paid and
nonassessable. Commencing immediately after the Effective Date, each certificate
which, prior to the Effective Date, represented such issued and outstanding
America Shares shall evidence ownership of Surviving Shares on the basis set
forth, subject to the limitations set forth in Section 2.5 hereof.
Section 2.3. Conversion of World House Shares.
Each of the World House Shares issued and outstanding on the Effective
Date, and all rights in respect thereof, shall on the Effective Date, without
any action on the part of any holder thereof, forthwith cease to exist and be
converted into and become exchangeable for one Surviving Share, validly issued,
fully paid and nonassessable. Commencing immediately after the Effective Date,
each certificate which, prior to the Effective Date, represented such issued and
outstanding World House Shares shall evidence ownership of Surviving Shares on
the basis set forth above, but subject to the limitations set forth in Section
2.5 hereof.
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Section 2.4. Fractional Shares.
Fractional shares shall not be issued. Instead, any fraction of a share
less than 0.50 shall be disregarded and the number of shares of the Surviving
Corporation shall be rounded down to the nearest whole share. Any fraction of a
share of 0.50 or greater shall be rounded up to the nearest whole share of the
Surviving Corporation.
Section 2.5 Exchange of Shares.
Subject to the terms and conditions hereof, the Surviving Corporation shall
issue and deliver to the Exchange Agent on the closing date 6,666.66 Surviving
Shares for each America Share issued and outstanding on the Effective Date,
excluding America Shares, if any, held in the treasury of America, and one
Surviving Share for each World House Share issued and outstanding on the
Effective Date. Commencing immediately after the Effective Date and until the
appointment of the Exchange Agent shall be terminated, each holder of a
certificate or certificates theretofore representing America Shares or World
House Shares may surrender the same to the Exchange Agent, and, after the
appointment of the Exchange Agent shall be terminated, any such holder may
surrender any such certificate to the Surviving Corporation. Such holder shall
be entitled upon such surrender to receive in exchange therefor a certificate or
certificates representing the number of Surviving Shares into which the America
Shares or World House Shares theretofore represented by the certificate or
certificates so surrendered shall have been converted as aforesaid. Until so
surrendered and exchanged, each outstanding certificate which, prior to the
Effective Date, represented issued and outstanding America Shares or World House
Shares shall be deemed for all corporate purposes of the Surviving Corporation,
other than the payment of dividends and other distributions, if any, to evidence
ownership of the number of Surviving Shares into which the America Shares or
World House Shares theretofore represented thereby shall have been converted on
the Effective Date. Unless and until any such certificate theretofore
representing America Shares or World House Shares is so surrendered, (i) no
dividend or other distribution, if any, payable to the holders of record of
Surviving Shares as of any date subsequent to the Effective Date shall be paid
to the holder of such certificate in respect thereof, and (ii) the Surviving
Corporation shall pay all such dividends and distributions, if any to the
Exchange Agent (and if the appointment of the Exchange Agent shall be
terminated, to itself) to be held in trust for the record holder of the
certificate or certificates of Surviving Shares to be issued in exchange for
such certificate theretofore representing America Shares or World House Shares.
Upon the surrender of any of such certificate theretofore representing America
Shares or World House Shares, however, the record holder of the certificate or
certificates of Surviving Shares issued in exchange therefor shall receive from
the Exchange Agent or from the Surviving Corporation, as the case may be,
payment of the amount of dividends or other distributions, if any, which
theretofore as of any date subsequent to the Effective Date were paid by the
Surviving Corporation to the Exchange Agent or to itself with respect to such
number of Surviving Shares. No interest shall be payable with respect to the
payment of such dividends and distributions upon surrender of certificates
theretofore representing America Shares or World House Shares. All such
dividends and distributions claimed at the termination of the appointment of the
Exchange Agent shall be released or repaid by the Exchange Agent to the
Surviving Corporation to be held by it in trust for the holders of the Surviving
Shares entitled thereto, and thereafter the holders of the Surviving Shares not
receiving payment of such dividends and distributions shall look only to the
Surviving Corporation for payment thereof, subject to possible forfeiture under
applicable escheat laws.
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Section 2.6. American Treasury Stock.
On the Effective Date, each American Share, if any, held in the treasury of
America shall be cancelled and retired, and no shares of stock or other
securities of the Surviving Corporation shall be issuable with respect thereto.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
America represents and warrants as follows:
Section 3.1. No Breaches of Statute or Contract; Required Consents.
Neither the execution and delivery of this Agreement or the related
articles of merger by America, nor compliance by America with the terms and
provisions thereof and of the Plan will: (i) conflict with or result in a breach
of any of the provisions of the articles of incorporation, bylaws or other
governing instruments of America, or any judgment, order, decree, or ruling to
which America is a party, or any injunction to which it is subject of any court
of governmental authority or of any agreement, contract or commitment to which
it is a party and which is material to the financial condition of America
considered as a whole, or (ii) require the affirmative consent or approval of
any non-governmental third party (apart from stockholder approval referred to
elsewhere herein).
Section 3.2. Authorization of Agreement.
America has the corporate power to enter into this Agreement and to perform
its obligations hereunder; the execution, delivery and, subject to requisite
stockholder approval, the performance of this Agreement by America has been duly
and validly authorized by the Board of Directors of America, and America has
taken, or will use its best efforts to take prior to the Effective Date, all
action required by law, its Articles of Incorporation and bylaws to authorize
the execution, delivery and performance of this Agreement, the Plan, and related
articles of merger.
Section 3.3. Further Representations.
(a) America is duly organized, validly existing and in good standing
as a corporation under the laws of the State of Delaware; has full corporate
power to carry on its business as it is now being conducted, and to own and
operate the properties and assets it now owns or operates; and is duly qualified
to do business and is in good standing in each jurisdiction where the conduct of
its business or the ownership of its properties require such qualification.
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(b) Pursuant to its Articles of Incorporation, America is authorized
to issue 1,500 shares of common stock with no par value, of which a total of
1,500 shares are each validly issued, fully paid and nonassessable. America has
no other class of stock or convertible securities outstanding. There are no
existing options, warrants, calls, commitments or rights of any character to
purchase or otherwise acquire from America shares of capital stock of any class,
no outstanding securities of America that are convertible into shares of capital
stock of America of any class, and no options, warrants or rights to purchase
from America any such convertible securities.
(c) America has heretofore delivered to World House accurate and
complete copies of the balance sheet of America at May 31, 1999 (the "America
1999 Balance Sheet") and the related statements of income, stockholders' equity
and changes in financial position of America from inception through May 31,
1999, in each case accompanied by the report thereon of Jack F. Burke Jr.,
independent certified public accountant. Such audited balance sheet fairly
presents the financial position of America at the date thereof and all such
audited statements of income, stockholders; equity and changes in financial
position present fairly the results of its operations, changes in stockholders;
equity and changes in financial position for the periods indicated, in
conformity with accounting principles generally accepted in the United States
and consistently applied.
(d) America has delivered to World House the following documents, all
of which have been signed for identification by the President of America and are
dated as of the date hereof. (i) a list of all the liabilities and obligations
of America as of May 31, 1999 (Schedule "A") ; and (ii) a list of all property
and all other assets of America as of May 31, 1999 (Schedule "B"). America has
good and marketable title to all properties and assets, real and personal,
described in Schedule "B". All of the properties and assets listed on Schedule
"B" are free and clear of all mortgages, pledges, liens, charges, security
interests or other encumbrances of any nature whatsoever, except for mortgages,
pledges, liens, charges, security interests or other encumbrances as set forth
in Schedule "B", liens for current taxes not yet due and payable, and
imperfections of title, easements and encumbrances, if any, that are not
substantial in character, amount or extent and do not materially detract from
the value, or interfere with the present or proposed use, of the property or
assets subject thereto or affected thereby, or otherwise materially impair
business operations. All leases pursuant to which America leases any substantial
amount of real or personal property are in good standing, valid and effective in
accordance with their respective terms, and under none of these leases is there
any existing default, event of default or event that with notice or the lapse of
time, or both, would constitute a default and in respect to which America has
not taken adequate steps to prevent a default from occurring.
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(e) Between May 31, 1999 and the date of this Agreement there has not
been any material adverse change in the financial condition or in the
operations, business or property of America.
(f) The structures, equipment, computers, and other physical assets of
America that are necessary to the operation of the business being conducted by
it are in good operating condition and repair, subject only to the ordinary wear
and tear of the business.
(g) Neither America nor, to the knowledge of its shareholders, any
other party have breached any material provision of, or defaulted in any
material respect of the terms of any contract or agreement to which America is a
party which would have a materially adverse effect upon the business or
financial condition of America.
(h) America will deliver such other lists, descriptions, information,
schedules, documents and reports as may reasonably be requested by World House
(i) To the best knowledge of its shareholders, there is no default or
claim, purported or alleged default, or statement of facts under which lack of
notice or the lapse of time, or both, would constitute a default on any
obligation to be performed by America under any material lease, contract, plan
or other arrangement.
(j) No suit, action or legal, administrative or arbitration
proceeding, which might materially and adversely affect the overall financial
condition, business or property of America is pending or, to the knowledge of
its shareholders, threatened.
(k) Its shareholders have no knowledge of any tax liability or claim
by any taxing authority for due but unpaid taxes, interest or penalties, nor has
America been advised of any request or demand for audit by any taxing authority.
(l) America owns or possesses, or reasonably believes it can acquire
on reasonable terms, adequate patent rights or other rights to use patent
rights, inventions, trademarks, service marks, trade names and copyrights
necessary to conduct the business now operated by it, and America has not
received any notice of infringement of or conflict with asserted rights of
others with respect to any patent, patent rights, inventions, trademarks,
service marks, trade names or copyrights which, individually or in the
aggregate, if subject of an unfavorable decision, ruling or finding, would have
a material adverse effect upon the business, operations, properties, assets or
condition, financial or otherwise, of America.
(m) The representations and warranties of its shareholders and America
shall be as of the date of this Agreement and as of the date of the Effective
Date. Any such representation made as of such dates shall survive the Closing
Date. All representations and warranties of America are based upon knowledge
only of its officers and directors and no one else.
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ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF WORLD HOUSE
World House represents and warrants as follows:
Section 4.1. Accuracy of Information Statement and Exchange Act Filings.
The information concerning World House contained, or incorporated by
reference, in the information statement informing the shareholders of World
House of the Merger and the Exchange Act filings of World House which have been
provided to America are responsive in all material respects to the requirements
of the appropriate forms and related rules and regulations, and do not contain
any untrue statement of a material fact or omit to state a material fact
necessary to make such information not misleading; provided, however, that as to
information supplied to World House by America which is included in the
information statement, World House represents only that it has no knowledge of
any such untrue statement or misleading omission.
Section 4.2. Status of Surviving Corporation Shares.
The shares of the Surviving Corporation's Shares to be issued to the
America Shareholders pursuant to this Agreement and Plan, when so issued, will
be duly and validly authorized and issued, fully paid and nonassessable.
Section 4.3. No Breach of Contract; Required Consents.
Neither the execution and delivery of this Agreement nor compliance by
World House with the terms of provisions hereof and of the Plan will: (i)
conflict with or result in a breach of any of the provisions of the Articles of
Incorporation or bylaws or other governing instruments of World House, or any
judgment, order, decree, or ruling to which World House is a party, or any
injunction to which it is subject of any court or government authority, or of
any agreement, contract or commitment to which World House is a party and which
is material to the financial condition or results of operations or conduct of
the business of World House considered as a whole, or (ii) require the
affirmative consent or approval of any nongovernmental third party.
Section 4.4. Authorization of Agreement.
World House has the corporate power to enter into this Agreement and to
perform its obligations hereunder; the execution, delivery and performance of
this Agreement by World House have been duly and validly authorized and approved
by the Board of Directors of World House; and World House has taken, or will use
its best efforts to take prior to the Effective Date, all action required by
law, its Articles of Incorporation or bylaws to authorize the execution,
delivery and performance of this Agreement and the Plan.
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ARTICLE V
CONDUCT AND TRANSACTIONS PRIOR
TO EFFECTIVE DATE
Section 5.1. Access; Operation of Business between the date of this
Agreement and the Effective Date.
(a) Access. America and World House each agrees to furnish the other
with such financial and operating data and other information with respect to the
business and properties of it as the other shall from time to time reasonably
request in furtherance of consummating the Merger; provided, however, that any
such investigation shall not affect any of the representations and warranties
hereunder. In the event of termination of this Agreement, America and World
House will each return to the other all documents and other material obtained
from the other in connection with the transactions contemplated hereby, and each
shall maintain the confidentiality of such materials.
(b) Conduct of Business. Except for the sale of Songs For The Planet,
Inc., the wholly owned subsidiary of World House described more fully in Section
6.3(d) of this Agreement, America and World House shall continue to conduct
their business in conformity with established industry practice in a diligent
manner and will use their best efforts to preserve intact their present business
organizations and preserve their relationships with persons having business
dealings with them.
(c) No Mergers. America and World House will not merge or consolidate
with any other corporation, or acquire any stock or, except in the ordinary
course of business, any business, property or assets of any other person, firm,
association, corporation or other business organization.
(d) No Securities Issuances. America and World House will not issue
any shares of any class of their capital stock, or enter into any contract, or
grant any option, warrant or right, calling for the issuance of any such shares,
and will not create or issue any securities convertible into any such shares or
convertible into securities in turn so convertible or enter into any contract,
or grant any option, warrant or right, calling for the issuance of any such
convertible securities. Notwithstanding the above, it is the intention of World
House to forward split its issued and outstanding common stock on the basis of
two and one half for one prior to the Effective Date. The effect of such forward
split of shares will be that World House will have 1,950,000 post forward split
Shares issued and outstanding as of the Effective Date.
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Section 5.2. Preparation of Information Statement.
Both America and World House acknowledge that they will participate in the
preparation of the information statement to be sent to the shareholders of the
Surviving Corporation relating to the disclosure of the Merger.
Section 5.3 Stockholder Approval of America.
America acknowledges and represents that the execution of this Agreement by
Elie Rabi as the sole shareholder of America, shall constitute all necessary
shareholder approval of the transaction contemplated hereby as is necessary
under Delaware law. Elie Rabi further acknowledges and represents that the
shares of the Surviving Corporation he or his assigns may acquire as a result of
the Merger contemplated herein are being acquired for investment purposes only
and not with a view toward their redistribution or reoffering. All stock
certificates representing Shares of the Surviving Corporation issued to the
shareholders of America shall be endorsed with the following restrictive legend:
The shares represented by this certificate have not been registered under
the Securities Act of 1933. The shares have been acquired for investment and may
not be offered, sold, or otherwise transferred in the absence of an effective
registration statement for the shares under the Securities Act of 1933, or a
prior opinion of counsel satisfactory to the issuer, that registration is not
required under the Act.
Section 5.4. Stockholder Approval of World House.
World House shall obtain approval of the Merger by consent of a majority of
shareholders in interest without a shareholder meeting as provided by Nevada
law.
ARTICLE VI
CONDITIONS TO OBLIGATIONS OF WORLD HOUSE AND AMERICA
Section 6.1. General Conditions.
The obligations of the parties hereto to effect the Merger shall be subject
to the following conditions:
(a) No Governmental Proceedings. No governmental action or proceeding
shall have been instituted or be threatened at the Closing Date by or before a
court or other governmental body, agency or authority to restrain or prohibit
the transactions contemplated by this Agreement.
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(b) No Litigation. There shall be no litigation pending at the Closing
Date challenging the authority of either America or World House or the officers
or directors of either to enter into this Agreement or seeking to restrain or
prohibit the transactions contemplated hereby, which the Board of Directors of
either America or World House shall reasonably believe to present a substantial
risk either of restraining or prohibiting such transactions or of resulting in
the award of material damages or other relief.
(c) Statutory Requirements and Approvals. All statutory requirements
for the valid consummation by America and World House of the transactions
contemplated by this Agreement and the Plan shall have been fulfilled; no
approvals of the transactions contemplated by this Agreement shall be required
from any federal or state governmental agency or authorities.
Section 6.2. Conditions of Obligation of World House.
The obligation of World House to effect the Merger shall be subject to the
following conditions:
(a) Representations and Warranties of America to be True. The
representations and warranties of America herein contained shall be true in all
material respects at the Closing Date with the same effect as though made at
such time, except to the extent waived hereunder or affected by the transactions
contemplated herein; America shall have performed all obligations and complied
with all covenants and conditions required by this Agreement to be performed or
complied with by it at or prior to the Closing Date; and America shall have
delivered to World House a certificate of America in form and substance
satisfactory to World House, dated the Closing Date and signed by its President
or Vice President to all such effects.
(b) Certificate of Elie Rabi. World House shall have received a
certificate dated the Closing Date and signed by Elie Rabi to all such effects
and to the effect that the statements contained in the America certificate
described above and in any other written documents delivered by or on behalf of
America pursuant to the provisions of this Agreement constitute representations
and warranties of America under this Agreement to the same extent as if herein
set forth in full.
(c) Auditors Letters. Jack F. Burke Jr. shall have delivered to World
House a letter dated the date of the Form 8-K report to be filed by World House
in connection with the Merger and the Closing Date, each to the effect that: (i)
he is an independent accountant within the meaning of the Securities Act of 1933
and the applicable published rules and regulations thereunder; (ii) in his
opinion, the financial statements of America examined by him and included in the
Form 8-K filed by World House in connection with the Merger comply as to form
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and content with the applicable accounting requirements of Regulation SX
promulgated under the Securities Act of 1933; and (iii) on the basis of
procedures (but not an examination in accordance with generally accepted
auditing standards) consisting of:
(1) reading the minutes of meetings of the Board of Directors of
America since May 31, 1999 as set forth in the minute books
through a specified date not more than five business days prior
to the delivery of such letter;
(2) reading the unaudited financial statements of America for the
period from May 31, 1999 to the date not more than five business
days prior to the delivery of such letter;
(3) making inquiries of certain officials of America who have
responsibility for financial and accounting matters regarding the
specific items for which representations are requested below;
nothing has come to his attention as a result of the foregoing procedures that
cause him to believe that:
(1) at the date of the latest available interim financial statements
there was any change in the capital stock or long-term debt of
America or any decreases in net current assets or net assets as
compared with amounts shown in the latest balance sheet included
in the Form 8-K report of World House or
(2) for the period from the date of the latest financial statements
included in the Form 8-K report of World House to the date of the
latest available interim financial statements there were any
decreases, as compared with the corresponding period in the
preceding year, in net revenues or in the total or per share
amounts of net income, except in all instances for such changes
or decreases with the Form 8-K report discloses have occurred or
may occur, or he shall state any specific changes or decreases.
and (iv) it contains such other information as reasonably requested by World
House.
(d) Exercise of Dissenter's Rights. Holders of no more than one
percent of the issued and outstanding shares of America shall have given notice
of their intention to receive payment in cash pursuant to their dissenter's
rights. In the event that more than one percent of the issued and outstanding
shares give such notice, World House may waive the condition and proceed with
the Merger.
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Section 6.3. Conditions of Obligation of America.
The obligations of America to effect the Merger shall be subject to the
following conditions:
(a) Representations and Warranties of World House to be True. The
representations and warranties of World House herein contained shall be true in
all material respects at the Closing Date with the same effect as though made at
such time, except to the extent waived hereunder or affected by the transactions
contemplated herein; World House shall have performed all obligations and
complied with all covenants and conditions required by this Agreement to be
performed or complied with by it prior to the Closing Date; and World House
shall have delivered to America a certificate of World House in form and
substance satisfactory to America, dated the Closing Date and signed by its
President and its principal financial officer, to all such effects.
(b) Exercise of Dissenter's Rights. Holders of no more than ten
percent of the issued and outstanding shares of World House shall have given
notice of their intention to receive payment in cash pursuant to their
dissenter's rights. In the event that more than ten percent of the issued and
outstanding shares give such notice, America may waive the condition and proceed
with the Merger.
(c) Subscription for Surviving Corporation Shares. By the Date of
Closing, the Surviving Corporation shall have received subscriptions from
investors to purchase 300,000 Surviving Corporation Shares for a total
consideration of Five Hundred Thousand Dollars ($500,000) and shall have also
received from investors subscriptions to purchase (i) 125,000 Surviving
Corporation Shares at a purchase price of $2.00 within 90 days of the Effective
Date and (ii) 125,000 Surviving Corporation Shares at a purchase price of $2.00
per share within 180 days of the Effective Date.
(d) Songs For The Planet, Inc., a wholly owned subsidiary of World
House, shall have been purchased by Elizabeth Peters for Ten Dollars and other
good and valuable consideration and all debt owed by Songs For The Planet, Inc.
to World House shall have been forgiven on the Date of Closing.
ARTICLE VII
INDEMNIFICATION
Section 7.1. Continuation of Representations and Warranties.
World House and America agree that the representations, warranties and
covenants of World House and America contained herein or in any instrument or
certificate delivered hereunder shall survive the Effective Date of the Merger,
regardless of any investigation or inquiry by or on behalf of World House and
America.
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Section 7.2. Indemnification by America.
America agrees to indemnify and hold harmless World House and each person,
if any, who controls World House within the meaning of Section 15 of the 1933
Act against any and all losses, liabilities, claims, damages and expenses
(including interest, expenses of litigation and attorney's fees) arising out of
or as a result of any inaccuracy or breach of any of the representations,
warranties and covenants of America contained in this Agreement and contained in
any instrument, schedule or certificate delivered to World House pursuant to
this Agreement, or the defense or settlement of any claim asserted against World
House challenging any such representation, warranty and covenant, or the failure
or default of America to perform or observe any covenant or condition under this
Agreement.
Section 7.3. Indemnification by World House.
World House agrees to indemnify and hold harmless America and each person,
if any, who controls America against any and all losses, liabilities, claims,
damages and expenses (including interest, expenses of litigation and attorneys'
fees) arising out of or as a result of any inaccuracy or breach of any of the
representations, warranties and covenants of World House contained in this
Agreement and contained in any instrument or certificate, delivered to America
pursuant to this Agreement, or the defense or settlement of any claim asserted
against America challenging any such representation, warranty and covenant, or
the failure or default of World House to perform or observe any covenant or
condition under this Agreement.
Section 7.4. Notice.
Each indemnified party shall give prompt notice to each indemnifying party
of any action commenced against it in respect of which indemnity may be sought
hereunder, but failure to so notify an indemnifying party shall not relieve it
from any liability which it may have otherwise than on account of this
Agreement. An indemnifying party may participate at its own expense in the
defense of such action. In no event shall the indemnifying parties be liable for
the fees and expenses of more than one counsel for all indemnified parties in
connection with any one action or separate but similar or related actions in the
same jurisdiction arising out of the same general allegations or circumstances.
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ARTICLE VIII
MODIFICATION, WAIVERS AND ABANDONMENT
Section 8.1. Modification.
America and World House may, by mutual consent of the respective Board of
Directors, amend, modify or supplement this Agreement in such manner as may be
mutually agreed upon in a writing executed by America and World House at any
time before or after action thereon by the stockholders of America and World
House; provided, however, that no such amendment, modification or supplement
shall affect the rights of the stockholders of America or World House in a
manner which is materially adverse to such stockholders in the judgment of the
Board of Directors of America and World House, respectively.
Section 8.2. Waivers.
Each of America and World House may, pursuant to action by its respective
Board of Directors, by an instrument in writing, extend the time for or waive
the performance of any of the obligations of the other or waive compliance by
the other with any of the covenants or conditions contained herein; provided,
however, that no such waiver or extension shall affect the rights of the
stockholders of World House or America in a manner which would be materially
adverse to such stockholders.
Section 8.3. Abandonment.
The Merger may be abandoned before the Closing Date of the Merger without
liability on the part of any party hereto exercising such right of abandonment
or restriction on the future activities of either party hereto:
(a) Mutual Consent. By the mutual consent of the Boards of Directors
of World House and America evidenced by a writing executed by World House and
America or;
(b) Lapse of Time. By the Board of Directors of World House or America
if the Effective Date has not occurred on or prior to August 31, 1999; provided,
however, that such date shall be extended for up to twenty-five (25) days in the
event an order restraining or prohibiting the Merger has been issued by any
public authority or court.
The power of abandonment provided for by this Section 8.3 may be
exercised by World House or America only by their respective Boards of Directors
and will be effective only after written notice thereof, signed on behalf of the
party for which it is given by its Chairman of the Board or President, shall
have been given to the other. If the Merger shall be abandoned, no articles of
merger or certificates relating to the Merger shall be filed by the officers of
any such party in the States of Nevada and Delaware. Abandonment shall not
effect any rights theretofore accruing hereunder.
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ARTICLE IX
ADDITIONAL MATTERS
Section 9.1. Management.
The parties agree that the Surviving Corporation shall continue to have the
same management after the contemplated Merger that America had prior to the
Merger.
Section 9.2. Closing.
The Closing of the Merger contemplated by this Agreement shall take place
at such time and place as may be convenient to all the parties but in no event
later than August 31, 1999. At the Closing America and World House shall deliver
and exchange the certificates specified in Sections 6.2(a) and 6.3(a) of this
Agreement. In addition, World House shall deliver to the Surviving Corporation
the cash and/or subscriptions for the Surviving Corporation Shares specified in
Section 6.3(c).
Section 9.3. Notices.
All notices, requests, demands and other communications which are required
of permitted hereunder shall be in writing and shall be deemed to have been duly
given when delivered personally or when mailed by registered or certified mail,
postage pre-paid, as follows:
If to World House to:
c/o David C. Owen
11011 King Street, Suite 260
Overland Park, Kansas 66210
If to America to:
c/o Elie Rabi
1200 S. Mt. Juliet Road, Suite C
Mt. Juliet, Tennessee 37122
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Section 9.4. Governing Law.
This Agreement shall be governed by and construed in accordance with the
laws of the State of Nevada.
Section 9.5. Entire Agreement.
This Agreement supersedes any and all oral or written agreements heretofore
made relating to the subject matter hereof and constitutes the entire agreement
of the parties relation to the subject matter hereof.
Section 9.6. No Implied Rights or Remedies.
Except as otherwise expressly provided herein, nothing herein expressed or
implied is intended or shall be construed to confer upon or to give any person,
firm or corporation, other than World House and America and their stockholders,
any rights or remedies under or by reason of this Agreement.
Section 9.7. Headings.
The headings in this Agreement are inserted for convenience of reference
only and shall not be part of, or control or affect the meaning of, this
Agreement.
Section 9.8. Counterparts.
This Agreement may be executed in several counterparts, each of which shall
be deemed an original, but all of which together shall constitute one and the
same instrument.
IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to
be executed on its behalf and attested by its officers there unto duly
authorized, all as of the day and year first above written.
World House Entertainment, Inc.,
a Nevada corporation
By: /s/Elizabeth Ann Peters
---------------------------
Elizabeth Ann Peters
President
800 America, Inc.,
a Delaware corporation
By: /s/Elie Rabi
----------------
Elie Rabi
President
17
ARTICLES OF MERGER
(PURSUANT TO NRS 92A)
STATE OF NEVADA
SECRETARY OF STATE
1. The name and jurisdiction of organization of each constituent entity is as
follows:
World House Entertainment, Inc., a corporation organized under the laws of
the State of Nevada (the "Surviving Corporation"); and
800 America, Inc., a corporation organized under the laws of the State of
Delaware (the "Merged Corporation").
2. A plan of merger has been adopted by each constituent entity.
3. not applicable
4. (b) A plan of merger was submitted to the owners pursuant to NRS 92A and
(1) 1,950,000 shares of common stock (the only class of equity securities
issued and outstanding) were entitled to vote on the plan of merger;
and
(2) 1,757,000 undisputed votes were cast in favor of the plan of merger
and such number of undisputed votes cast for the plan of merger by the
owners of the common stock (the only class of securities entitled to
vote on such plan) was sufficient for approval by the owners of the
common stock.
5. World House Entertainment, Inc. (the surviving corporation), as a result of
the adopted plan of merger, hereby amends its Articles of Incorporation as
follows:
Article One: Name of Corporation:
800 AMERICA.COM, Inc.
6. The completely executed plan of merger is on file at the registered office
of the corporation.
<PAGE>
Dated July 14, 1999 World House Entertainment, Inc. a
Nevada corporation
By: /s/ Elizabeth Ann Peters
------------------------
Elizabeth Ann Peters
President
And By: /s/ Benjamin Justin Peters
---------------------------
Benjamin Justin Peters
Secretary
State of Tennessee
County of Wilson
This instrument was acknowledged before me On July 14, 1999 by Elizabeth
Ann Peters as President and Benjamin Justin Peters as Secretary of World House
Entertainment, Inc., a Nevada corporation.
/s/ (Notary)
------------
Notary Public
(Seal) My commission expires ______________, ___.
800 America, Inc., a
Delaware corporation
By: /s/ Elie Rabi
-------------
Elie Rabi
President
And By: /s/ Ruth E. Walley
------------------
Ruth E. Walley
Secretary
State of Tennessee
County of Wilson
This instrument was acknowledged before me On July 14, 1999 by Elie Rabi as
President and Ruth E. Walley as Secretary of 800 America, Inc. a Delaware
corporation.
/s/ Lisa Isham
- --------------
Notary Public
(Seal) My commission expires September 6, 1999.
