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
VOXCOM HOLDINGS, INC.
(Name of Small Business Issuer in Its Charter)
Nevada 75-2715335
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
8115 Preston Road, Eighth Floor-East, Dallas, Texas 75225
(Address of Principal Executive Offices) (Zip Code)
(214) 691-0055
(Issuer's Telephone Number)
Securities to be registered pursuant to 12(b) of the Act: None
Securities to be registered pursuant to 12(g) of the Act:
Common Stock $.0001 Par Value
(Title of Class)
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TABLE OF CONTENTS
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Page
PART I
Item 1. Description of Business.........................................................................3
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations.......................................................................9
Item 3. Description of Property........................................................................14
Item 4. Security Ownership of Certain Beneficial Owners and Management.................................15
Item 5. Directors, Executive Officers, Promoters and Control Persons...................................16
Item 6. Executive Compensation.........................................................................18
Item 7. Certain Relationships and Related Transactions.................................................19
Item 8. Description of Securities......................................................................20
PART II
Item 1. Market Price of and Dividends of the Registrant's Common Equity
and Other Shareholder Matters..................................................................26
Item 2. Legal Proceedings..............................................................................27
Item 3. Changes in and Disagreements with Accountants..................................................27
Item 4. Recent Sales of Unregistered Securities........................................................27
Item 5. Indemnification of Directors and Officers......................................................28
PART F/S
Financial Statements
PART III
Item 1. Index to Exhibits..............................................................................30
Item 2. Description of Exhibits........................................................................30
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Explanatory Note:
Unless otherwise indicated or the context otherwise requires, all
references herein to the "Company" are to Voxcom Holdings, Inc., a Nevada
corporation, and its wholly-owned subsidiaries, Voxcom Systems, Inc. AmeraPress,
Inc, and The Home Business Group, Inc.
PART I
Item 1. Description of Business
General
Newcorp One, Inc. ("Newcorp"), a corporation organized under the laws
of the State of Nevada in September 1996, acquired all of the issued and
outstanding shares of common stock of Voxcom Systems, Inc., a company organized
under the laws of the State of Delaware in November 1994, in exchange for an
aggregate of 4,000,000 post-split shares of voting common stock of Newcorp, at
$.0001 par value per share, and 4,000,000 post-split Class A Warrants and Class
B Warrants, pursuant to an Agreement and Plan of Reorganization, dated June 9,
1997. Newcorp was formed in accordance with the Plan of Reorganization of Weaver
Arms Corporation, as confirmed by the United States Bankruptcy Court, Central
District of California on January 20, 1994. At the time of the acquisition of
Voxcom Systems, Inc., Newcorp had no assets, business or operations.
Voxcom Systems was organized to provide merchant accounts and credit
card processing solutions to small businesses, home based businesses,
multi-level marketing distributors, and independent distributors. In operation
since January 1995, Voxcom Systems is engaged in the transaction processing
industry, providing low-cost credit card processing to diverse merchants,
including in-home businesses, through its patented and proprietary Credit
Verification Phone system.
On June 18,1997, Newcorp filed Restated Articles of Incorporation with
the Secretary of State of Nevada, increasing the Company's authorized common
stock from 50,000,000 shares to 100,000,000 shares, adding provisions regarding
corporate management and control, and changing the name of the Company to
"Voxcom Holdings, Inc." ("Voxcom Holdings").
On June 19, 1997, the Company filed a Certificate of Decrease in
Authorized and Issued Shares with the Secretary of State of Nevada, stating a
change in the number of shares of the Company's common stock from 100,000,000
shares to 25,000,000 shares, resulting from a reverse split of shares. There was
no change in par value.
Concurrent with its acquisition of Voxcom Systems, Voxcom Holdings
acquired all of the issued and outstanding common stock of AmeraPress, Inc.
("AmeraPress"), a corporation organized under the laws of the State of Nevada in
June 1997 to engage in the specialty printing and finishing
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business. AmeraPress succeeded to the business of Voxcom Sales, L.L.C. ("Voxcom
Sales"), a company organized under the laws of the State of Delaware in November
1995. The common stock of AmeraPress was acquired in exchange for a $10,000,000
note, payable in 24 consecutive, equal monthly installments. The Promissory Note
was collateralized by all of the outstanding shares of AmeraPress, pursuant to a
Security Agreement-Pledge by and between Voxcom and the shareholders of
AmeraPress. In December 1997, the remaining balance of the Promissory Note was
exchanged for 80,000 shares of Series A Preferred Stock redeemable at the option
of the Company at the issue price of $100 each.
In March 1997, Voxcom Sales, entered into a Promissory Note in the
amount of $76,711, and Purchase Money Security Agreement securing the Note, with
General Binding Corporation ("GBC"), a Delaware corporation, for the purchase of
equipment consisting of a GBC Vulcan II System (Versa Feeder, Vulcan II
Laminator and Vulcan II Cutter). The Note is payable in twelve quarterly
payments of $6,393 to be paid through purchases of laminating film by AmeraPress
through GBC. At December 31, 1997, the Note balance was $58,000.
On July 1, 1997, the Company entered into a Consulting Agreement and
Covenant Not to Compete with Kim Crowther and Brian Jensen to manage a company
to conduct home business seminars to promote the Company's goods and services,
including the printed products of AmeraPress (the "Lecture Company") and to
compensate them for their exclusive service to the Lecture Company for a period
of sixty (60) months by granting them 200,000 shares of the Company's common
stock, 4% of the gross proceeds of sales by the Lecture Company, and commissions
equal to 25% of the net profit of the Lecture Company on a combined basis. The
Company will also grant them shares of the Company's common stock at June 30,
1998 in an amount equal to the net profit of the Lecture Company on a combined
basis, subject to deductions for federal income tax, debt service obligations of
the Lecture Company, and commissions paid, multiplied by the average price to
earnings ratio of the Company's common stock over the 90 days prior to June 30,
1998, multiplied by 25%, and divided by the average over the 20 trading days
preceding June 30, 1998 of the mean bid and ask price in the over-the-counter
market. In each succeeding year of the Agreement, shares of common stock will be
granted based on the same formula, except that instead of using net profit (as
adjusted) as the starting number, the growth in net profit over the previous
year will be substituted and the same adjustments applied. Home Business Group,
Inc. was incorporated in the State of Delaware and acquired certain assets and
liabilities of and continued the business of the Lecture Company, commencing
during the quarter ended December 31, 1997. The continued operations of
AmeraPress and Home Business Group, Inc. are referred to together as the "Home
Business Segment".
On August 5, 1997, to assist the Company in securing and retaining key
professional and consulting personnel, the Board of Directors approved the 1997
Stock Bonus Plan (the "Plan"). The total number of shares to be issued under the
Plan were limited to 750,000 shares of Common Stock. Shares issued pursuant to
the Plan will be registered with the Securities and Exchange Commission
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under a Form S-8 registration statement when the Company is eligible to use such
form. Pursuant to the Plan, a total of 575,000 shares of Common Stock were
issued to seven individuals. The Plan expired on September 30, 1997.
On March 13, 1998 the Company acquired all of the issued and
outstanding shares of MAXpc Technologies, Inc. in consideration for the issue of
210,000 shares of Common Stock. MAXpc has the exclusive manufacturing and
marketing rights to certain multimedia computer hardware and software. Marketing
of the product commenced at the end of April 1998. The contract also provides
that 25% of the net after tax profits of MAXpc will be paid to the Seller.
See Part II, Item 1., "Market Price of and Dividends on the
Registrant's Common Equity and Other Shareholder Matters."
The Company's activities to date have consisted of the promotion and
marketing through seminars of home-based business opportunities, the production
and sale of customized printing and the sale and distribution of merchant credit
card authorization and payment systems, as well as raising capital, locating and
acquiring equipment, identifying prospective customers, and administrative
activities relating to the foregoing.
The Company's future business, including expansion of its present
operations, may require additional equity and/or debt financing, which may not
be available in a timely manner, on commercially reasonable terms, or at all.
See Part 1, Item 2 "Management's Discussion and Analysis or Plan or Operation."
See Part I, Item 7, "Certain Relationships and Related Transactions"
for information about the interests of certain directors, executive officers and
promoters of the Company in the formation and reorganization transactions
described above involving Voxcom Holdings, Voxcom Systems, AmeraPress, and HBG.
See Part 1. Item 3, "Description of Property," for information about
the Company's facilities.
Principal Products, Distribution and Competitive Conditions
The Company's activities are divided into three segments:
(i) Credit card processing and authorization systems;
(ii) Home-based business; and
(iii) Technology;
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Credit Card Processing and Authorization Systems
In May, 1992, the credit card industry responded to increasing levels
of credit card fraud by requiring advance authorization of all credit card
transactions or else charging the merchant extra processing fees for
unauthorized charges. It is estimated that 97% of all credit card purchases in
the U.S. are preceded by such authorizations.
The Company, through its subsidiary Voxcom Systems, Inc., offers
merchants of all sizes a competitive product which can include processing
hardware, voice platform and authorization, and an attractive discount rate on
all credit card transactions.
For the small merchant, or direct salesperson, the Company's
proprietary Credit Verification Phone ("CVP") is a host-based system utilizing
an interactive Voice Platform instead of a modem. The device is manufactured by
KIA Intertrade, an unaffiliated company located in Korea. The CVP is compact and
light-weight. It does not require A.C. power, is portable, offers a voice
tutorial to users, and can be used as a standard telephone if desired. The
Company also provides minor repairs at its Euless, Texas facility for
malfunctioning CVP terminals, and returns malfunctioning CVP terminals requiring
major repair to the manufacturer for replacement.
This segment of the Company's business employs 14 people and has 75
commissioned agents in 31 states. Business is generated either by incoming
responses from national advertising or from contact by the experienced agent.
Competition for credit card verification business is intense, and the
market is saturated with systems to meet this need. Most are modem based,
on-line systems requiring a dedicated phone line, and the cost of access systems
ranges from $195 to $1,700. The Company believes it can compete for a share of
the business because of the affordability, portability and multiple uses of its
CVP and due to its relationships with processing banks and card providers.
For the large merchant the Company is able to offer other
manufacturers' systems to meet the appropriate need. The larger merchants
approached by the Company usually require more expensive and more sophisticated
credit card processing equipment. Most of this equipment necessitates a
dedicated phone line compared to the post ability of the CVP. The Company is
able to offer equipment from other manufacturers to meet all needs of merchants
for their processing.
The Company has the following contractual arrangements in the credit
card industry. The Company is an independent sales organization (ISO) of
Heartland Card Services, Inc., a credit processing company. The Company is
charged interchange costs to the credit card provider (VISA and Master Card) by
Heartland and accounts to Heartland a share of the increase over the interchange
cost charged to its clients.
The Company has agreements with Delta Card Systems/Woodforest Bank,
Electronic Card Systems, First American Payment Systems/First National Bank in
Brookings and Money Transfer
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System/NPC whereby the Company purchases credit card processing at an
established rate, and retains the discount rate charged above that rate. The
Company believes it is now competitive in the discount rates being offered to
all types of businesses ranging from the sole trader to the very large
corporations. More than $100 million of annual credit card throughput has been
contracted by the Company since October 1997, and the residual income from this
segment of the business is growing.
Home-Based Business Division
The Company operates this division through two wholly owned
subsidiaries, Home Business Group, Inc. ("HBG") and AmeraPress Inc. HBG conducts
seminars in major cities throughout the United States and offers attendees the
opportunity to purchase introductory kits to approximately four different
home-based businesses. One of these businesses is AmeraPress, and the others
include vending machines, an Internet product and prepaid telephone cards, none
of which is affiliated with the Company except that a director of HBG is a
shareholder and officer of the vending machine company.
HBG attracts its attendees by a mailing campaign requesting recipients
to call in and register for attendance at the appropriate seminar. It earns its
income from the sale of the introductory kits provided free of charge by the
offered businesses, and from an additional fee paid by those businesses for each
sale made.
HBG employs 52 people at its offices in St. George, Utah.
AmeraPress conducts business with the distributors enrolled at the HBG
seminars by the purchase of the Introductory Kit. This kit includes video and
audio tapes, distribution manual and sufficient salable materials to make 100%
return on their cost of approximately $200. The distributors are advised by
AmeraPress how to make their home business operate. Such business is to
introduce consumers to the opportunity of having a photograph of their choice,
and the appropriate words or sketches of their choice printed on top quality,
fully laminated trading, business, greeting, or post card or calendar. Sales are
made by way of pre-paid voucher which the distributor buys from AmeraPress and
resells to the consumer at an attractive profit. Thereafter the distributor's
job is finished, and the consumer returns the voucher with all appropriate
information to AmeraPress for fulfillment.
AmeraPress employs 97 people at its leased premises in Euless, Texas.
It has installed state- of-the-art printing technology and on small-run printing
jobs such as its personalized cards, the quality product is high quality and
cost efficient.
The home-based business industry is extremely large and very
competitive, Distributors are sought for many multi-level and direct sales
organizations, and many home-based business opportunity seminars are held.
However, the Home-Based Business Segment of the U.S. economy is one of the
fastest growing parts of the economy, and there are many untapped opportunities
available to the Company.
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Technology Division
Through the end of 1997, all of the Company's business and revenues
were produced from the Home-Based Business Segment and the Credit Card
Processing and Authorization Segment. However, the Company continually seeks
opportunities to diversify its operations and exploit products and markets with
the potential for rapid growth.
In April 1998 the Company acquired all of the common stock of MAXpc
Technologies, Inc. ("MAX"). MAX has the exclusive right to manufacture and
market a high performance multi-media add-in card providing both hardware and
software to personal computers. This card offers 22 different media functions,
including full motion video capture and editing; DVD movie playback and H Stop
324 video phone over standard phone lines. Such card enhances the performance of
computers, either as an add-in at time of manufacture or installed into existing
units.
MAX commenced marketing this card at the end of April 1998, and no
revenues or expenses are included in any of the financial statements included
herein. Marketing is being targeted to original equipment manufacturers, dealers
and resellers in the industry. MAX employees four people in the corporate
office.
While the Company believes that the MAX board fulfills functions that
no other single board can achieve, competition in the industry is extremely
high, and new developments and products are offered regularly. There is no
assurance the marketing efforts for this computer card will be successful.
The Company has the ability to upgrade the board over the next twelve
months with the addition of new software products, and some of these upgrades
will give rise to the availability of patent protection. The Company will
continue limited research and development in this regard.
Environmental Impact
None of the Company's activities utilize any hazardous materials or
results in any discharge of pollutants into the environment. The Company
believes it complies fully with all environmental laws and regulations.
Year 2000
The Company does not expect any adverse consequences from the problems
arising in the computer industry upon the advent of the year 2000.
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Regulation
The Company's only regulatory issues not common to all businesses is
the oversight of its home-based business services and sales programs by the U.S.
Federal Trade Commission. The laws and regulations of the FTC provide for
consumer protection against false and misleading sales promotions. The Company
believes it is in compliance with these laws; however, see Part II, Item 2,
"Legal Proceedings".
Item 2. Management's Discussion and Analysis or Plan of Operation
General
The Company through its wholly-owned subsidiaries:
(i) sells and distributes merchant credit card authorization and
payment systems to direct marketing merchants throughout the
United States (commenced November 1994);
(ii) markets home-based business through seminars (acquired in
1997) and produces customized printing for distribution by
home-based businesses (commenced January 1996); and
(iii) manufacturers and markets computer hardware and software
(commenced April 1998).
Revenues and expenses for the fiscal year ended June 30, 1996 applied
only to the credit card authorization systems and to six months of the
customized printing business. Revenues and expenses for the fiscal year ended
June 30, 1997 applied to a full year for each of these businesses. No results
from the computer hardware and software are included in the revenues and
expenses.
For the six (6) months ended December 31, 1997, the revenues and
expenses apply to the operations of these two businesses for the whole period,
and to the seminar business for only the two months since acquisition.
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SELECTED FINANCIAL INFORMATION
Six Months Six Months
Year Ended Ended Ended
6/30/96 6/30/97 12/31/96 12/31/97
(unaudited) (unaudited) (unaudited)
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Statement of Operations Data
Net sales $2,005,486 $13,420,766 $5,076,933 $12,287,356
Gross profit 1,581,288 11,537,659 4,103,203 10,877,040
Operating income (loss) (709,833) 3,162,307 303,745 2,131,917
Net earnings (loss) after tax (709,833) 2,923,519 303,745 1,254,648
Net earnings (loss) per share (.14) N/A N/A .24
Pro forma net earnings (1) -- 1,964,378 191,359 --
Pro forma earnings per share -- .39 .04 --
(1) Pro forma net earnings give effect to income taxes that would have been
provided if the Company had been subject to federal and state income
taxes for all periods. See Note K to Financial Statements.
June 30, 1997 December 31, 1997
Balance Sheet Data unaudited)
Total assets $1,312,441 $3,327,546
Working capital deficit (5,017,331) (1,154,227)
Total liabilities 10,438,045 2,623,502
Stockholders' equity (deficit) (9,125,604) 704,044
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Results of Operations
Six months ended December 31, 1997 compared to six months ended December 31,
1996.
Revenues
Revenues increased by approximately 142% from $5,076,933 in the six
months ended December 1996 to $12,287,356 in the six months ended December 1997.
This increase was mainly from sales by the Home Based Business Segment through
expansion of the printing business and to the inclusion of the revenues of Home
Business Group Inc. Revenues of this segment were the largest component of sales
and increased by approximately 157% from $4,451,376 in the six months ended
December 1996 to $11,468,458 in the six months ended December 1997.
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Cost of Sales
Cost of sales increased by approximately 45% from $973,730 in the six
months ended December 1996 to $1,410,316 in the six months ended December 1997.
The increase resulted from the increased operating activity of the Home Based
Business Segment, but reflects the higher margins obtainable as such sales
increase.
Gross Profit
Group gross profit increased approximately 165% from $4,103,203 in the
six months ended December 1996 to $10,877,040 in the six months ended December
1997. The increase is almost entirely due to, and reflects the expansion of, the
printing business and the inclusion of gross profit from the seminar business,
both forming the Home Based Business Segment. This 88% gross margin demonstrates
the attractiveness of this business to the Company.
Selling, General and Administrative Expenses
Selling, general and administrative expenses increased approximately
130% from $3,799,458 in the six months ended December 1996 to $8,745,123 in the
six months ended December 1997. The increase was due almost entirely to the Home
Based Business Segment and reflects the increases of labor, commissions,
delivering expenses, and overheads necessary to achieve the increased revenues
achieved by the division.
Interest Expense
Interest expense of $140,412 incurred during the six months ended
December 1997 was paid on the promissory note to the Company's Shareholders who
sold AmeraPress to the Company. On December 15, 1997 the note was converted to
Series A Preferred Stock, and no further interest is payable. No interest
expense was incurred for the six months ended December 1996.
Income Taxes
Income taxes of $736,857 were accrued based on income earned for the
six months ended December 31, 1997. No income tax was accrued for the six months
ended December 1996, because for that period the income was earned in a limited
liability company for which the members of the LLC were personally responsible
for taxes on the Company's income.
Net Earnings
Net earnings increased by approximately 313% from $303,745 in the six
months ended December 1996 to $1,254,648 in the six months ended December 1997.
This increase was almost entirely due to the increased profitability of the Home
Based Business Segment and reflected both the business expansion and the
inclusion of the seminar business.
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Fiscal year ended June 30, 1997 compared to year ended June 30, 1996
Revenues
Revenues increased by approximately 569% from $2,005,486 in the year
ended June 30, 1996 to $13,420,766 in the year ended June 30, 1997. The increase
is due almost entirely to the Home Based Business Segment which booked its first
full year of operation.
Cost of Sales
Cost of sales increased by approximately 344% from $424,198 in the year
ended June 30, 1996 to $1,883,107 in the year ended June 30, 1997. The increase
was almost entirely due to the Home Based Business Segment and represents the
increased costs needed to achieve the increased revenues.
Selling, General and Administrative Expenses
Selling, general and administrative expenses increased approximately
266% from $2,291,121 in the year ended June 30, 1996 to $8,375,352 in the year
ended June 30, 1997. The increase represents the costs of labor, commissions,
delivery expenses, and overheads required by the Home Based Business Segment to
achieve the increased revenues.
Interest Expense
Interest expense of $44,247 incurred in the year ended June 30, 1997
was paid on the promissory note to the Sellers of AmeriPress. No interest
expense was incurred in the year ended June 30, 1996.
Income Tax
The income tax expense in the year ended June 30, 1997 of $194,541 was
accrued on the net profit of the divisions earned from the date of acquisition
by the Company to June 30, 1997. No income tax was accrued in the year ended
June 30, 1996. The effective rate of tax for the year ended June 30, 1997 was
less than the full statutory rate due to the availability of net operating
losses from prior years.
Net Earnings
Net earnings increased from a loss of $709,833 in the year ended June
30, 1996 to a profit of $2,923,519 in the year ended June 30, 1997. The increase
of profitability was almost entirely due to the Home Based Business Segment
which operated for the full year to June 30, 1997 compared to only six months in
the year to June 30, 1996.
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Liquidity
For the year ended June 30, 1997, the Company's profit of $2,923,519
was supplemented by noncash charges to earnings of $329,574 and changes in
operating assets and liabilities of $37,717 to provide total of cash available
from operations of $3,290,810.
Payments for capital equipment ($263,978), payments on note payable
($760,000) and distributions to stockholders prior to acquisition by the Company
($1,920,000) reduced the net increase in available cash funds for the year to
$346,832.
For the six months ended December 31, 1997 the Company's profit of
$1,254,648 was supplemented by noncash charges to earnings of $153,597 and
changes in operating assets and liabilities of $467,440 to provide a total of
cash available from operations of $1,875,685. Payments to noteholders reduced
the amount by $1,560,299 and payments for capital equipment amounted to
$449,189, resulting in a net cash outflow for the six months of $133,803.
Future cash resources available to the Company are expected to come
from profitable operations and the issue of shares as a result of anticipated
exercises of warrants at $4 each. Should the need arise for further funding for
increases in inventories or for capital equipment, the Company would address the
possibility of lines of credit from lending authorities and new issues of
capital stock. There is no assurance that these resources will be available to
the Company.
Recent Events
Federal Trade Commission
On February 17, 1998, the Federal Trade Commission (FTC) obtained from
the United States District Court an ex parte Temporary Restraining Order and
Asset Freeze on AmeraPress, Inc., and Home Business Group, Inc., two of the
subsidiary companies of the Company. A Temporary Receiver was also appointed by
the Court. The FTC alleged violations of the FTC Act in connection with the
Company's business of marketing sales opportunities for home based businesses.
On February 27, 1998, the Federal District Court removed the Temporary
Restraining Order and replaced it with a new order which substantially eased the
restrictions placed on the Company. Under the new order, the Company resumed
operations under limited oversight by a court appointed monitor to review
expenditures of the Company within specified limits and monitor sales
information.
On April 13, 1998 the FTC and the Company agreed to a compromise and
settlement of the case. The Company did not admit to any violation of any law,
statute, rule, or regulation or to the commission of any wrongful act. The FTC,
by agreeing to the terms of the final order, did not admit to any violations of
law, statute, rule, or regulation, or to the commission of any wrongful act.
Instead, all parties deny any violations or wrongdoing.
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The agreement with FTC included the payment to the FTC of refunds to
distributors which would be reimbursed to those distributors by FTC. Refunds due
prior to the FTC action were approximately $145,000 and increased to more than
$465,000 during the time of the FTC investigation. The Company believes that
many of the distributors were led to believe that the Company was being closed.
Additional to the $465,000 payable as above, an administrative fee of $35,000
was also agreed to be paid. The Company has a policy of offering refunds to
distributors for a period of ten days, and the average rate of refunds
experienced before the FTC action was approximately 10% of sales.
Legal fees approximating $500,000 have been incurred fighting this
unwarranted action. These requests for refunds and legal fees have impacted upon
the Company's profitability and cash resources during the fourth quarter of
fiscal 1998. To meet these extraordinary expenses the Company is encouraging
warrant holders to exercise, as set out hereunder:
Warrants
On March 17, 1998, the Company reduced the exercise price of its Class
A warrants from $6.00 to $4.00 per warrant as permitted by the instrument
creating the warrant . This was done to encourage the Class A Warrant holders to
exercise and thereby provide the Company with increased reserves and increased
stockholder equity. As of May 15, 1998, a total of 81,000 shares had been issued
upon exercise of warrants, generating $324,000 in additional equity.
MAXpc Technologies, Inc.
On March 13, 1998, the Company agreed to purchase all of the issued and
outstanding stock of MAXpc Technologies, Inc., subject to a 30 day due diligence
period.
On April 13, 1998, the agreement became effective, and 200,000 shares
of common stock were issued to the Seller. At the same time, finders fees of
10,000 shares of common stock were issued.
MAXpc Technologies, Inc. has the exclusive rights to manufacture and
market a high performance, multi-media add-in card providing both hardware and
software for inclusion in either new or existing computers.
Item 3. Description of Property
Principal Plants and Other Property
On February 1, 1998, subsequent to the expiration of the Company's
lease from an unaffiliated party on its principal executive offices, located at
14990 Landmark Place, Suite 250, Dallas, Texas, the Company moved its principal
executive offices to 8115 Preston Road, Suite 800, Dallas, Texas 75225. The
premises, which are leased from an unaffiliated party, consist of 11,010
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square feet. The executive office facility contains five management offices, 11
work stations, state of the art computers, and related software. Monthly rent is
$22,020 through the remainder of a sixty-four month Lease Term, which expires on
May 31, 2003.
The Company has a renewal option to extend the Lease Term for one
additional period of five years, at a rental rate equal to the prevailing market
for such premises at that time.
The Company's printing facility is located at 203 South Ector Drive,
Euless, Texas. The premises, which are leased from an unaffiliated party,
consist of approximately 19,777 square feet. Monthly rent is $3,500, commencing
January 1, 1996 through March 31, 1999. The Company has a renewal option to
extend the lease for one term of three years, at a monthly rental of $4,025. The
facility contains printing and pre-press equipment, including Polar cutting
machines, Challenge cutting machines, GBC double sided and single sided
laminating machines, multiple Cannon color processors, photo scanners, and
Macintosh computers. Approximately 1,500 square feet of this facility is used
for storage of executive office records, and for the shipping and programming of
CVP equipment. Pursuant to an Addendum to the lease, the Company has an
exclusive option to purchase the property, such option to terminate on March 31,
1999. The Company has the option to purchase the property and will consider the
possibility during 1998. The Company believes its current facilities are
adequate for its current needs.
Item 4. Security Ownership of Certain Beneficial Owners and Management
The following table sets forth information as of December 31, 1997 with
respect to persons known to the Company to be the beneficial owners of more than
5% of its voting securities and with respect to the beneficial ownership of such
securities by each director of the Company and by all directors and executive
officers of the Company as a group.
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Amount and Nature
Name and Address of of Beneficial Percent of Class A
Beneficial Owner Ownership (1)(2) Common Stock Warrants % Warrant
<S> <C> <C>
Lawrence R. Biggs, Jr. 1,070,000(1) 18.5% 1,088,000 21.8%
24,000(2)
Lawrence Cahill 2,000,000(1) 34.5% 1,900,000 28%
40,000(2)
Donald G. McLellan 800,000(1) 13.8% 660,000 13.4%
16,000(2)
Ronald L. Brown 50,000(1) .9% -- --
Directors and officers as a group 4,332,500(1) 74.9% 3,648,000 73.2%
(9 persons) 80,000(2)
</TABLE>
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(1) Each of the parties listed has sole voting and investment power with
respect to all shares of Common Stock with the exception that Donald G.
McLellan has 50% voting and investment power in Vision Finance and
Management, a family company which owns 400,000 common shares and
400,000 Class A Warrant included in the above table. Beneficial
ownership is calculated in accordance with Rule 13d-3(d) under the
Securities Exchange Act of 1934, as amended.
(1) Common Stock.
(2) Series A Preferred Shares.
The Company is not aware of any arrangement which might result in a
change in control in the future.
Item 5. Directors, Executive Officers, Promoters and Control Persons
The following table sets forth certain information about the directors,
executive officers, and significant employees of Voxcom Holdings, Inc. and its
wholly-owned subsidiaries, Voxcom Systems, Inc., AmeraPress, Inc., and Home
Business Group, Inc.
<TABLE>
<S> <C>
Position with
Subsidiaries
Name Age Position with Company Company(1)(2)(3)(4)
Lawrence R. Biggs, Jr. 39 Chairman of the Board, (1)(2)(3)(4)
Chief Executive Officer (1)(2)
Donald G. McLellan 58 President, Secretary and
Director (1)(2)(3)(4)
Lawrence A. Cahill 61 Director (1)(2)
Ronald L. Brown 51 Director
Delmar E. Guenther 60 (1)
Gwynda Gee 33 (2)
Kim Crowther 46 (3)
Brian Jenson 37 (3)
Gary Raabe 32 (4)
</TABLE>
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<PAGE>
(1) Officer and/or Director of Voxcom Systems, Inc.
(2) Officer and/or Director of AmeraPress, Inc.
(3) Officer and/or Director of Home Business Group, Inc.
(4) Officer and/or Director of MAXpc Technologies, Inc.
Lawrence Biggs is the founder of the Company and has been Chairman of
the Board and Chief Executive Officer of Voxcom Holdings, Inc., Voxcom Systems,
Inc., and AmeraPress, Inc. since June 1997. Mr. Biggs is Chairman of the Board
of Home Business Group, Inc., holding that position since August 1997. During
1988, Mr. Biggs was Vice president of Public Telecom Corporation; a private
company that developed a microprocessor controlled desktop telephone designed
for specific network access. From 1989 to 1994, Mr. Biggs was president and CEO
of Strategic Telecom, Inc. ("Strategic"). While associated with Strategic, he
developed and contracted for the manufacture of the Access Phone, a product
patented under his name for specific applications, some of which are used by
Voxcom. During the time Mr. Biggs was associated with Strategic, in excess of
150,000 Access Phones were placed in hotel rooms throughout the United States.
During 1993, Strategic's board of directors rejected the attempt of an investor
group to sell the company. The investor's group filed an involuntary Chapter 7
Bankruptcy Proceeding in the United States Bankruptcy Court, District of
Delaware in November, 1994, which was subsequently converted to a Chapter 11
Bankruptcy Proceeding in January, 1995 and confirmed by the Court in May 1995.
Mr. Biggs resigned as president and CFO in November 1993. Mr. Biggs was a
founding director of the National Pay Telephone Association in 1984. He attended
the University of Nevada, Las Vegas from 1977 to 1981.
Donald G. McLellan has been President of Voxcom Holdings, Inc. since
June 1997, as well as Director of Voxcom Holdings, Inc., Voxcom Systems, Inc.,
and AmeraPress, Inc. since that date. He has been a Director of Home Business
Group, Inc. since August 1997. Mr. McLellan is a native of Australia where he
was involved in the formation and capitalization of entrepreneurial companies in
various industries. In 1989, he found the initial investment monies for
Strategic Telecom, Inc., and acted as a consultant to the Company until 1992,
when he was appointed C.F.O. In November 1993, Mr. McLellan became C.E.O. of
Strategic, serving in that capacity throughout the company's Chapter 11
bankruptcy proceeding, and until the confirmation of its Plan of Reorganization
in May 1995. Mr. McLellan became a Fellow of the Institute of Chartered Accounts
(the Australian equivalent to Certified Public Accountant) in 1963.
Lawrence Cahill has been a Director since June 1997. Mr. Cahill is the
President and Treasurer of Larken, Inc., a Cedar Rapids, Iowa-based hospitality
management company founded by Mr. Cahill and his brother in 1956. Larkin, Inc.
presently manages over fifteen hotels with approximately 3,500 rooms throughout
the continental United States and has been the largest franchiser of Holiday Inn
hotels. Mr. Cahill specializes in property acquisitions and private investments.
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<PAGE>
Ronald L. Brown has been a director since June, 1997. Mr. Brown is a
principal of the Dallas law firm of Glast, Phillips & Murray, P.C., which serves
as general counsel to the Company. He has been in the private practice of law
since 1975. In 1983-85, he was an adjunct professor of law at Southern Methodist
University. Mr. Brown serves on the Board of Directors of several privately
owned companies.
Delmar E. Guenther, President of Voxcom Systems, Inc., joined Voxcom
Systems, Inc., in August 1994, to help develop the banking and processing
systems for Voxcom Systems' CVP. Prior to 1994, he was self-employed as the
owner of Merchant Financial Systems.
Gwynda Gee, President of AmeraPress, Inc., joined AmeraPress, Inc. as
Vice President of Operations in September 1996. In this capacity, Ms. Gee
restructured the customer service and production departments to maximize
employee efficiency, improve product quality and customer service. Ms. Gee was
named President of AmeraPress in January 1998. From November 1995 to August
1996, Ms. Gee was Vice President of Operations for Hardwarehouse. Ms. Gee was
Systems Director for Voxcom Systems from December 1994 to November 1995. Ms. Gee
jointed Strategic Telecom in 1989 and during the course of her tenure advanced
to Systems Director before her departure in December 1994.
Kim D. Crowther, President of Home Business Group, Inc. since April
1996. Prior to that he was employed by Financial Freedom for at least five years
as a motivational speaker.
Brian Jensen, Vice President and co-founder of Home Business Group,
Inc. since April 1996. From 1993 to the present he has served as President of
Vendworx, a supplier of vending machines.
Gary J. Raabe, CEO of MAXpc Technologies, Inc., since April 1998. Prior
to that, from 1993 to 1998, he was the owner and operator of Computer Broker.
From 1991 to 1993, he was the operations manager of The Logic Approach. He has
specialized in the development of low cost telecomuting, televideo conferencing,
televideo marketing, video surveillance and video-configuration systems.
Directors serve for a term of one year or until their successors are
elected and qualified. Directors do not receive cash compensation for serving as
such.
Executive officers are appointed by and serve at the will of the Board
of Directors. There are no family relationships between or among any of the
directors or executive officers of the Company.
By virtue of their activities in founding and organizing the Company,
as well as their beneficial ownership of its voting securities, Lawrence R.
Biggs, Jr., Donald G. McLellan, and Lawrence A. Cahill may be deemed to be
"promoters" of the Company.
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<PAGE>
Item 6. Executive Compensation
The following summary compensation table sets forth certain information
regarding compensation paid during each of the two fiscal years ended June 30,
1997 and 1996, and the six months ended December 31, 1997 to the person serving
as the Company's Chief Executive Officer during the years ended June 30, 1997
the six months ended December 31, 1997. No annual compensation in excess of
$100,000 was awarded to, earned by or paid to any director or executive officer
of the Company for services rendered in any capacity in any of the fiscal years
indicated.
Name and Principal Fiscal
Position Year Total Remuneration(1)
Lawrence Biggs 1997 $536,047
1996* 181,829
David G. McLellan 1997 229,270
1996* 89,221
* Compensation paid by Voxcom Systems prior to acquisition by Voxcom Holdings.
(1) Salary and commissions.
There is no employment agreement with any executive officer. There are
no salary, bonus or incentive plans covering cash or securities except the
Company's 1997 Stock Bonus Plan relating to individuals or one-person service
corporations who render legal, professional, or consulting services to the
Company.
Item 7. Certain Relationships and Related Transactions
Lawrence R. Biggs, Jr., a director, executive officer and promoter of
the Company, acquired 30,000 shares of Voxcom Systems for $300 upon its
organization in November 1994.
Lawrence Cahill, a director and promoter of the Company, acquired 50000
shares of Voxcom Systems for $500.
Donald G. McLellan, a director, executive officer and promoter of the
Company, acquired 20,000 shares of Voxcom Systems for $200 and transferred
10,000 shares to Vision Finance and Management.
The Company acquired all of the issued and outstanding stock of Voxcom
Systems in exchange for 4,000,000 post-split shares of the Company's voting
Common Stock and 4,000,000 post-split Class A Warrants and Class B Warrants
pursuant to an Agreement and Plan of Reorganization, dated June 9, 1997 In
connection with this transaction, Lawrence R. Biggs, Jr. received 1,200,000 of
such shares and 1,200,000 of such warrants; Donald McLellan and Vision Finance
and Management received 800,000 of such shares and 800,000 of such warrants, and
Lawrence Cahill received 2,000,000 of such
19
<PAGE>
shares and 2,000,000 of such warrants. See Part I, Item 1, "Description of
Business--General" and Part I, Item 5, "Directors, Executive Officers, Promoters
and Control Persons."
In June 1997, the Company acquired 10,000 shares of AmeraPress Common
Stock, representing 100% of shares outstanding, pursuant to a Stock Purchase
Agreement dated June 9, 1997. On June 11, 1997, in connection with this
transaction, a Promissory Note in the amount of $10,000,000 was executed by the
Company payable to Lawrence R. Biggs, Jr., Donald McLellan, and Lawrence Cahill.
Concurrent with this transaction, and pursuant to the Promissory Note, the
Company entered into a Security Agreement-Pledge in favor of Lawrence R. Biggs,
Jr., Lawrence Cahill and Donald G. McLellan as Secured Parties. In December
1997, the Company issued 80,000 shares of its Preferred Stock, valued at
$8,000,000, to Lawrence R. Biggs, Jr., Donald G. McLellan, and Lawrence Cahill,
to fully convert the amount of the Promissory Note.
In April 1998, Lawrence Cahill advanced $300,000 to pay the fees of law
firms representing the Company in the case against the Federal Trade Commission.
The Company has agreed to repay the amount from the first cash resources
available after the payment of current overheads. No interest is payable.
In May 1998, Lawrence R. Biggs Jr. and Donald G. McLellan agreed to
fund the inventory of Max cards on behalf of MAXpc Technologies, Inc., and the
Company and Lawrence Cahill have agreed to a pro-rata repayment of these
advances. No interest is payable.
Item 8. Description of Securities
The authorized capital stock of the Company consists of 75,000,000
shares of capital stock, composed of 25,000,000 shares of Common Stock, par
value $0.0001 per share ("Common Stock"), and 50,000,000 shares of Preferred
Stock, par value $.0001 per share ("Preferred Stock").
Common Stock
Voting Rights. Each holder of shares of Common Stock is entitled to one
vote for each share of Common Stock for the election of directors and on each
other matter submitted to a vote of the stockholders of the Company. The holders
of Common Stock have exclusive voting power on all matters at any time no
Preferred Stock with superior voting rights is issued and outstanding.
Liquidation Rights. Upon liquidation, dissolution or winding up of the
Company, holders of shares of Common Stock are entitled to share ratably in
distributions of any assets after payment in full or provision for all amounts
due creditors and provision for any liquidation preference of any other class or
series of stock of the Company then outstanding.
Dividends. Dividends may be declared by the Board of Directors and paid
from time to time to the holders of Common Stock, on such record dates as may be
determined by the Board of Directors, out of the net profits or surplus of the
Company.
20
<PAGE>
Warrants. All stockholders of the Company hold one Class A Warrant for
each common share acquired by them. Each warrant entitles the holder to purchase
one share of Common Stock for $4.00. If not exercised, Class A Warrants expire
in June 1999. If exercised, the holder will receive one Class B Warrant for each
Class A Warrant. Each Class B Warrant entitles the holder to purchase one share
of common stock for $20.00. If not exercised, Class B Warrants expire in June
2000. At December 31, 1997, there were 4,999,937 Class A Warrants outstanding;
none had been exercised.
Preferred Stock
The Board of Directors of the Company has the authority to divide the
Authorized Preferred Stock into series, the shares of each series to have such
relative rights and preferences as shall be fixed and determined by the Board of
Directors. The provisions of a particular series of Authorized Preferred Stock,
as designated by the Board of Directors, may include restrictions on the payment
of dividends on Common Stock. Such provisions may also include restrictions on
the ability of the Company to purchase shares of Common Stock or to purchase or
redeem shares of a particular series of Authorized Preferred Stock. Depending
upon the voting rights granted to any series of Authorized Preferred Stock,
issuance thereof could result in a reduction in the voting power of the holders
of Common Stock. In the event of any dissolution, liquidation or winding up of
the Company, whether voluntary or involuntary, the holders of each series of the
then outstanding Authorized Preferred Stock may be entitled to receive, prior to
the distribution of any asset or funds to the holders of Common Stock, a
liquidation preference established by the Board of Directors, together with all
accumulated and unpaid dividends. Depending upon the consideration paid for
Authorized Preferred Stock, the liquidation preference of Authorized Preferred
Stock and other matters, the issuance of Authorized Preferred Stock could result
in a reduction in the assets available for distribution to the holders of Common
Stock in the event of the liquidation of the Company.
As of the date hereof, the only outstanding Authorized Preferred Stock
is (i) a series of 100,000 authorized shares of Series A Preferred Stock of
which 80,000 shares are outstanding. Following is a brief summary of certain
provisions of each of this Series of Authorized Preferred Stock.
Voting Rights. Holders of Series A Preferred Stock have no right to
vote their Shares, except that holders of Series A Preferred Stock, voting as a
separate class by majority vote, must approve any amendment to the Designation
of Rights and Preferences of Series A Preferred Stock, to (i) increase or
decrease the number of authorized shares of Series A Preferred Stock, (ii)
increase or decrease the Issue Price, (iii) effect an exchange, reclassification
or cancellation of all or part of the shares of Series A Preferred Stock, (iv)
effect an exchange, or create a right of exchange, of all or any part of the
shares of another class into shares of Series A Preferred Stock, (v) change the
designations, preferences, limitations, or relative rights of the Series A
Preferred Stock, (vi) change the shares of Series A Preferred Stock into the
shares of another class, or (viii) cancel or otherwise affect accumulated but
undeclared dividends on the Series A Preferred Stock.
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<PAGE>
Preemptive Rights. No holder of Series A Preferred Stock will be
entitled as a matter of right to subscribe or receive additional shares of any
class of stock of the Company, whether now or hereafter authorized, or any
bonds, debentures or other securities convertible into such stock.
Liquidation Rights. In the event of any liquidation, dissolution or
winding up of the Company, holders of Preferred Stock are entitled to be paid an
amount agreed to $100 per share. Such Preferred Stock before any accounts an
distributed to the holder of this Common Stock.
Conversion Rights. There are no conversion rights for holders of
Preferred Stock.
Dividends. The holders of Preferred Stock are not entitled to receive
any dividends.
Redemption Rights. The Preferred Stock is redeemable by the Company.
The redemption price is $100 per share.
Certain Rights of Holders of Common Stock
The Company is a Nevada corporation organized under Chapter 78 of the
Nevada Revised Statutes ("NRS"). Accordingly, the rights of the holders of
Common Stock are governed by Nevada law. Moreover, the rights of holders of
Common Stock differ from the rights of such holders of equity in the corporation
or other entity acquired by virtue of different provisions appearing in the
Articles of Incorporation ("Articles") and bylaws of the Company. Although it is
impracticable to set forth all of the material provisions of the NRS or the
Company's Articles and bylaws, the following is a summary of certain significant
provisions of the NRS and/or the Company's Articles and bylaws that affect the
rights of securities holders.
Possible Anti-Takeover Provisions
Special Meetings of Stockholders; Director Nominees. The Company's
bylaws and Articles provide that special meetings of stockholders may be called
by stockholders only if the holders of at least 66-2/3% of the Common Stock join
in such action. The bylaws and Articles also provide that stockholders desiring
to nominate a person for election to the Board of Directors must submit their
nominations to the Company at least 60 days in advance of the date on which the
last annual stockholders' meeting was held, and provide that the number of
directors to be elected (within the minimum - maximum range of 3-21 set forth in
the Articles and bylaws) shall be determined by the Board of Directors or by the
holders of at least 66 2/3% of the Common Stock. While these provisions of the
Articles and bylaws have been established to provide a more cost-efficient
method of calling special meetings of stockholders and a more orderly and
complete presentation and consideration of stockholder nominations, they could
have the effect of discouraging certain stockholder actions or opposition to
candidates selected by the Board of Directors and provide incumbent management a
greater opportunity to oppose stockholder nominees or hostile actions by
stockholders. The affirmative vote of holders of at least 66-2/3% of the Common
Stock is necessary to amend, alter or adopt any provision inconsistent with or
repeal any of these provisions.
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<PAGE>
Removal of Directors. The Articles of the Company provide that
directors may be removed from office only for "cause" by the affirmative vote of
holders of at least 66 2/3% of the Common Stock. "Cause" means proof beyond the
existence of a reasonable doubt that a director has been convicted of a felony,
committed gross negligence or willful misconduct resulting in a material
detriment to the Company, or committed a material breach of such director's
fiduciary duty to the Company resulting in a material detriment to the Company.
The inability to remove directors except for "cause" could provide incumbent
management with a greater opportunity to oppose hostile actions by stockholders.
The affirmative vote of holders of at least 66 2/3% of the Common Stock is
necessary to amend, alter or adopt any provision inconsistent with or repeal
this provision.
Control Share Statute. Sections 78.378 - 78.3793 of the NRS constitute
Nevada's control share statute, which set forth restrictions on the acquisition
of a controlling interest in a Nevada corporation which does business in Nevada
(directly or through an affiliated corporation) and which has 200 or more
stockholders, at least 100 of whom are stockholders of record and residents of
Nevada. A controlling interest is defined as ownership of Common Stock
sufficient to enable a person directly or indirectly and individually or in
association with others to exercise voting power over at least 20% but less than
33.3% of the Common Stock, or at least 33.3% but less than a majority of the
Common Stock, or a majority or more of the Common Stock. Generally, any person
acquiring a controlling interest must request a special meeting of stockholders
to vote on whether the shares constituting the controlling interest will be
afforded full voting rights, or something less. The affirmative vote of the
holders of a majority of the Common Stock, exclusive of the control shares, is
binding. If full voting rights are not granted, the control shares may be
redeemed by the Company under certain circumstances. If full voting rights are
granted, stockholders voting against such rights being granted may demand
payment from the Company for the fair value of their shares. The Board of
Directors may adopt a resolution amending the Bylaws within ten days following
the acquisition of any controlling interest to provide that the foregoing
provisions shall not be applicable to such acquisition. The Company does not
believe the foregoing provisions of the NRS is presently applicable to it
because it does not presently conduct business in Nevada; however, if in the
future it does conduct business in Nevada then such provisions may apply.
Business Combination Statute. Sections 78.411 - 78.444 of the NRS set
forth restrictions and prohibitions relating to certain business combinations
and prohibitions relating to certain business combinations with interested
stockholders. These Sections generally prohibit any business combination
involving the Company and a person that beneficially owns 10% or more of the
Common Stock (an "Interested Stockholder") (i) within five years after the date
(the "Acquisition Date") the Interested Stockholder became an Interested
Stockholder, unless, prior to the Acquisition Date, the Company's Board of
Directors had approved the combination or the purchase of shares resulting in
the Interested Stockholder becoming an Interested Stockholder; or (ii) unless
five years have elapsed since the Acquisition Date and the combination has been
approved by the holders of a majority of the Common Stock not owned by the
Interested Stockholder and its affiliates and associates; or (iii) unless the
holders of Common Stock will receive in such combination, cash and/or property
having a fair market value equal to the higher of (a) the market value per share
of Common Stock on the date of announcement of the combination or the
Acquisition Date, whichever is higher, plus interest
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<PAGE>
compounded annually through the date of consummation of the combination less the
aggregate amount of any cash dividends and the market value of other dividends,
or (b) the highest price per share paid by the Interested Stockholder for shares
of Common Stock acquired at a time when he owned 5% or more of the outstanding
shares of Common Stock and which acquisition occurred at any time within five
years before the date of announcement of the combination or the Acquisition
Date, whichever results in the higher price, plus interest compounded annually
from the earliest date on which such highest price per share was paid less the
aggregate amount of any cash dividends and the market value of other dividends.
For purposes of these provisions, a "business combination" is generally defined
to include (i) any merger or consolidation of the Company or a subsidiary with
or into an Interested Stockholder or an affiliate or associate; (ii) the sale,
lease or other disposition by the Company to an Interested Stockholder or an
affiliate or associate of assets of the Company representing 5% or more of the
value of its assets on a consolidated basis or 10% or more of its earning power
or net income; (iii) the issuance by the Company of any of its securities to an
Interested Stockholder or an affiliate or associate having an aggregate market
value equal to 5% or more of the aggregate market value of all outstanding
shares of the Company; (iv) the adoption of any plan to liquidate or dissolve
the Company proposed by or under an agreement with the Interested Stockholder or
an affiliate or associate; (v) any receipt by the Interested Stockholder or an
affiliate, except proportionately as a stockholder, of any loan, advance,
guarantee, pledge or other financial assistance or tax credit or other tax
advantage; and (vi) any recapitalization or reclassification of securities or
other transaction that would increase the proportionate shares of outstanding
securities owned by the Interested Stockholder or an affiliate. Sections 78.411
- - 78.444 of the NRS are presently applicable to the Company.
Special Meetings
The Company's bylaws and Articles provide that special meetings of the
stockholders of the Company may be called by the Chairman of the Board, the
Board of Directors or upon written request of stockholders holding not less than
66 2/3% of the Common Stock.
Mergers, Consolidations and Sales of Assets
Nevada law provides that an agreement of merger or consolidation, or
the sale or other disposition of all or substantially all of a corporation's
assets, must be approved by the affirmative vote of the holders of a majority of
the voting power of the corporation (except that no vote of the stockholders of
the surviving corporation is required to approve a merger if certain conditions
are met, unless the articles of incorporation of such corporation states
otherwise, and except that no vote of stockholders is required for certain
mergers between a corporation and a subsidiary), but does not require the
separate vote of each class of stock unless the corporation's articles of
incorporation provides otherwise (except that class voting is required in a
merger if shares of the class are being exchanged or if certain other rights of
the class are affected). The Company's Articles do not alter the provisions of
Nevada law.
24
<PAGE>
Directors; Removal of Directors
Under Nevada law, the number of directors may be fixed by, or
determined in the manner provided in, the articles of incorporation or by-laws,
and the Board of Directors may be divided into classes as long as at least 25%
in number of the directors are elected annually. Nevada law further requires
that a corporation have at least one director. Directors may be removed under
Nevada law with or without cause by the holders of not less than two-thirds of
the voting power of the corporation, unless a greater percentage is set forth in
the articles of incorporation. See "-Possible Anti-Takeover Provisions - Removal
of Directors" and "---Classification of Directors", above, for a further
discussion.
Limitation on Liability of Directors
Section 78.037 of the NRS provides that a Nevada corporation may limit
the personal liability of a director or officer to the corporation or its
stockholders for breaches of fiduciary duty, except that such provision may not
limit liability for acts or omissions which involve intentional misconduct,
fraud or a knowing violation of law, or payment of dividends or other
distributions in violation of the NRS. The Company's Articles provide that no
director shall be personally liable to the Company or its stockholders for
monetary damages or breach of fiduciary duty as a director, except for liability
(i) for any breach of the director's duty of loyalty to the Company or its
stockholders, (ii) for acts or omissions not in good faith or which involved
intentional misconduct or a knowing violation of law, (iii) liability under the
NRS, or (iv) for any transaction from which the director derived an improper
personal benefit.
In the opinion of the Securities and Exchange Commission, the
indemnification and limitation of liability provisions described in "--
Indemnification of Directors and Officers", above, and "-- Limitation on
Liability of Directors" would not eliminate or limit the liability of directors
and officers under the federal securities laws.
Amendments to Bylaws
The Company's bylaws may be amended by the Board of Directors or
stockholders, provided, however that certain provisions can only be amended by
the affirmative vote of holders of at least 66 2/3% of the Common Stock. These
provisions relate to special meetings of stockholders, actions by written
consent of stockholders, nomination of directors by stockholders, proceedings
for the conduct of stockholder's meetings and the procedures for fixing the
number of and electing directors.
Appraisal Rights
The NRS provides dissenting or objecting security holders with the
right to receive the fair value of their securities in connection with certain
extraordinary corporate transactions. These appraisal rights are available with
respect to certain mergers and share exchanges and in connection with the
granting of full voting rights to control shares acquired by an interested
stockholder. However, unless the transaction is subject to the control share
provisions of the NRS, a stockholder of a Nevada corporation may not assert
dissenters' rights, in most cases, if the stock is listed on a national
securities exchange
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<PAGE>
or held by at least 2,000 stockholders of record (unless the articles of
incorporation expressly provide otherwise or the security holders are required
to exchange their shares for anything other than shares of the surviving
corporation or another publicly held corporation that is listed on a national
securities exchange or held of record by more than 2,000 stockholders).
Distributions
Dividends and other distributions to security holders are permitted
under the NRS as authorized by a corporation's articles of incorporation and its
board of directors if, after giving effect to the distribution, the corporation
would be able to pay its debts as they become due in the usual course of
business and the corporation's total assets would exceed the sum of its total
liabilities plus (unless the articles of incorporation provide otherwise) the
amount needed to satisfy the preferential rights on dissolution of holders of
stock whose preferential rights are superior to those of the shares receiving
the distribution.
Preemptive Rights
Under the NRS, stockholders of Nevada corporations organized prior to
October 1, 1991 have preemptive rights unless the articles of incorporation
expressly deny those rights or the stock issuance is among those described in
Section 78.265 of the NRS. A stockholder who has preemptive rights is entitled,
on terms and conditions prescribed by the board of directors, to acquire
proportional amounts of the corporation's unissued or treasury shares in most
instances in which the board has decided to issue them. The Company's Articles
expressly deny availability of preemptive rights to the Company's stockholders.
Cumulative Voting
Under the NRS, the articles of incorporation of a corporation may
provide for cumulative voting, which means that the stockholders are entitled to
multiply the number of votes they are entitled to cast by the number of
directors for whom they are entitled to vote and then cast the product for a
single candidate or distribute the product among two or more candidates.
Cumulative voting is not available to stockholders of a Nevada corporation,
however, unless its articles expressly provide for that voting right, and the
Company's Articles do not contain a provision permitting stockholders to
cumulate their votes when electing directors.
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PART II
Item 1. Market Price of and dividends on the Registrant's Common Equity and
Other Shareholder Matters
Market Information
The Company's Common Stock is traded in the over-the-counter market on
the Nasdaq Bulletin Board under the Symbol "VXCH." The following table shows the
price range of the Company's Common Stock since it was initially quoted in
November 1997.
BID ASK
High Low High Low
Fourth Quarter 1997 6-1/8 2 6-5/8 2-7/8
First Quarter 1998 5-3/4 1-5/8 6-1/4 1-7/8
Holders
As of December 31, 1997, there were 191 record holders of the Company's
Common Stock and 3 holders of the Company's Preferred Stock.
Dividends
The Company does not anticipate any stock or cash dividends in the
foreseeable future.
Item 2. Legal Proceedings
Except as described in Part I, Item 2, "Management Discussion and
Analysis or Plan of Operations - Recent Developments - Federal Trade
Commission," neither the Company nor any of its subsidiaries currently is a
party to, or owns property subject to, any pending or threatened legal
proceedings which, in the opinion of management, are likely to have a material
adverse impact on the financial condition of the Company."
Item 3. Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure
None.
27
<PAGE>
Item 4. Recent Sales of Unregistered Securities
The following information sets forth certain information for all
securities the Company sold during the past three years without registration
under the Securities Act of 1933 (the "Securities Act"). All transactions were
effected in reliance on the exemption from registration afforded by Section 4(2)
of the Securities Act for transactions not involving a public offering. There
were no underwriters in any of these transactions.
Pursuant to the Plan of Reorganization of Weaver Arms Corporation, a
Nevada corporation, as confirmed by the United States Bankruptcy Court, Central
District of California, on January 20, 1994, and in satisfaction of all approved
claims therein, the Company (then known as Newcorp One, Inc.) in June 1997,
issued 1,000,000 post split shares of its common stock and 1,000,000 Class A
Warrants, to Weaver Arms' creditors, Certificate of Indebtedness holders,
shareholders, and administrative claimants.
In accordance with an Agreement and Plan of Reorganization, dated June
9, 1997, this Company issued 4,000,000 post-split shares of its common stock,
$.0001 par value per share, and 4,000,000 post-split Class A Warrants and Class
B Warrants, to Lawrence R. Biggs, Jr., Lawrence Cahill, and Donald G. McLellan
and Vision Finance and Management, the shareholders of Voxcom Systems, Inc., in
the amount of 1,200,000 shares, 2,000,000 shares, 400,000 shares and 400,000
shares, respectively.
In July 1997, the Company's predecessor, pursuant to a Consulting
Agreement and Covenant Not to Compete, issued 100,000 shares of the Company's
common stock at par to each of Kim Crowther and Brian Jensen, Directors of Home
Business Group, Inc.
Pursuant to the 1997 Stock Bonus Plan, the Company issued a total of
575,000 shares of its common stock at par to Rick Graf, Gwynda Gee, Ronald L.
Brown, Kim Crowther, Brian Jensen, and Herbert Sievers, for services provided to
the Company. See Part I, Item 1, "Description of Business General."
In December 1997, the Company issued 80,000 shares of Preferred Stock
at an issue price of $100 per share to Messrs. Cahill, Briggs and McLellan in
conversion of $8,000,000 principal amount of promissory notes.
In April 1998, the Company issued 210,000 shares of Common Stock in
connection with the acquisition of the Computer Based Business for a recorded
issue price of $2.50 per share.
In May 1998, The Company issued 110,000 shares of Common Stock under a
Consulting Agreement with Jande International Holdings, LLC for consideration
consisting of future services to the Company.
28
<PAGE>
Item 5. Indemnification of Directors and Officers
Article VII, Section 710 of the Company's Bylaws provides for
indemnification of officers and directors to the fullest extent permitted by the
provisions of the General Corporation Law of Nevada (the "Nevada Law").
Under Section NRS 78.7502 of the Nevada Law, a corporation may
indemnify a past or present director or officer against liability incurred in a
proceeding if (1) the director or officer conducted himself in good faith, (2)
the director or officer reasonably believed that his conduct was in, or not
opposed to, the corporation's best interest, and (3) in the case of any criminal
action or proceeding, the director or officer had no reasonable cause to believe
his conduct was unlawful; provided, however, that a corporation may not
indemnify a director or officer (i) in connection with a proceeding by or in the
right of the corporation in which the director or officer is adjudged liable to
the corporation, unless, and only to the extent that, the court in which the
action or suit was brought or other court of competent jurisdiction determines
that the director or officer is fairly and reasonably entitled to
indemnification in view of all the relevant circumstances.
In addition, pursuant to subsection 3 of Section NRS 78.7502 of the
Nevada Law, a corporation shall indemnify a director or officer who is wholly
successful, on the merits or otherwise, in the defense of any proceeding to
which he is a party because he is or was a director or officer against
reasonable expenses incurred by him in connection with the proceeding.
PART F/S
The following financial statements are filed as part of this
registration statement on Form 10-SB. Financial Statements as of June 30, 1997
and for the year then ended have been audited by Grant Thornton LLP, as stated
in their report. Audited Financial Statements for the year ended June 30, 1996
are not available, and unaudited financial statements are included pursuant to
the Form 10-SB, Part F/S. Financial Statements for the six month periods ended
December 31, 1996 and 1997 have not been audited, but are believed by management
to contain all accruals and adjustments required for a fair presentation of the
financial condition and results of operations of the Company in accordance with
generally accepted accounting principles.
Auditor's Report
Balance Sheets as of June 30, 1997 and December 31, 1997.
Statement of Operations for the years ended June 30, 1996, June 30,
1997, and six months ended December 31, 1996 and December 31, 1997.
Statement of Changes in Shareholders' Equity for the two years and six
months ended December 31, 1997.
29
<PAGE>
Statement of Cash flow for the years ended June 30, 1996, June 30,
1997, and the six months ended December 31, 1996 and December 31, 1997.
Notes to Financial Statements.
30
<PAGE>
Report of Independent Certified Public Accountants
Board of Directors and Stockholders
Voxcom Holdings, Inc.
We have audited the accompanying consolidated balance sheet of Voxcom Holdings,
Inc. and Subsidiaries as of June 30, 1997, and the related consolidated
statements of earnings, stockholders' equity (deficit), and cash flows for the
year then ended. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on these
financial statements based on our audit.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above, present fairly, in
all material respects, the consolidated financial position of Voxcom Holdings,
Inc., and Subsidiaries as of June 30, 1997, and the consolidated results of
their operations and their consolidated cash flows for the year then ended, in
conformity with generally accepted accounting principles.
GRANT THORNTON LLP
Dallas, Texas
October 28, 1997
F-1
<PAGE>
<TABLE>
<CAPTION>
Voxcom Holdings, Inc.
CONSOLIDATED BALANCE SHEETS
December 31,
ASSETS June 30, 1997 1997
------------- ------------
<S> <C> <C>
CURRENT ASSETS
Cash and cash equivalents $ 375,687 $ 241,884
Inventories 363,409 381,952
Receivables -- 294,391
Other current assets 41,618 551,048
----------- -----------
Total Current assets 780,714 1,469,275
PROPERTY AND EQUIPMENT, AT COST
Machinery and equipment 323,606 585,359
Furnishings 103,281 290,717
----------- -----------
426,887 876,076
Less accumulated depreciation 117,895 164,835
----------- -----------
308,992 711,241
OTHER ASSETS 222,735 1,147,030
----------- -----------
$ 1,312,441 $ 3,327,546
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
CURRENT LIABILITIES
Current maturities of notes payable to stockholders $ 5,000,000 $ 79,701
Accounts payable 536,953 1,349,100
Accrued expenses 66,551 457,844
Income taxes payable 194,541 736,857
----------- -----------
Total current liabilities 5,798,045 2,623,502
NOTES PAYABLE TO STOCKHOLDERS, less current maturities 4,640,000 --
COMMITMENTS -- --
STOCKHOLDERS' EQUITY (DEFICIT)
Preferred stock, $100 par value; authorized, 50,000,000 shares;
issued and outstanding, 80,000 shares at December 31 -- 8,000,000
Common stock, $.0001 par value; authorized, 25,000,000 shares;
issued and outstanding, 4,999,937 shares at June 30 and 5,574,937
shares at December 31 500 557
Additional paid-in capital -- 574,943
Accumulated deficit (9,126,104) (7,871,456)
----------- -----------
(9,125,604) 704,044
----------- -----------
$ 1,312,441 $ 3,327,546
=========== ===========
</TABLE>
The accompanying notes are an integral part of these statements.
F-2
<PAGE>
<TABLE>
<CAPTION>
Voxcom Holdings, Inc.
CONSOLIDATED STATEMENTS OF EARNINGS
Six months ended
Year ended June 30, December 31,
---------------------------- ---------------------------
1996 1997 1996 1997
---------- ----------- ---------- ----------
<S> <C> <C>
(unaudited) (unaudited)
Net sales $2,005,486 $13,420,766 $5,076,933 $12,287,356
Cost of sales 424,198 1,883,107 973,730 1,410,316
-------- ---------- -------- ----------
Gross profit 1,581,288 11,537,659 4,103,203 10,877,040
Selling, general and
administrative expenses 2,291,121 8,375,352 3,799,458 8,745,123
--------- ---------- --------- ----------
Operating income (loss) (709,833) 3,162,307 303,745 2,131,917
Interest expense - 44,247 - 140,412
--- ------- --- --------
Earnings (loss) before
income taxes (709,833) 3,118,060 303,745 1,991,505
Income taxes - 194,541 - 736,857
--- -------- --- --------
Net earnings (loss) $ (709,833) $ 2,923,519 $ 303,745 $1,254,648
========= ========== ======== =========
Earnings (loss) per share - basic $(.14) $.24
==== ===
Weighted average shares outstanding 4,999,937 5,302,017
========= =========
Unaudited pro forma information (Note K):
Earnings before income taxes $3,118,060 $ 303,745
Pro forma income tax expense 1,153,682 112,386
--------- --------
Pro forma net earnings $1,964,378 $ 191,359
========= ========
Pro forma earnings per share - basic $.39 $.04
=== ===
Weighted average shares outstanding 4,999,937 4,999,937
========= =========
</TABLE>
The accompanying notes are an integral part of these statements.
F-3
<PAGE>
<TABLE>
<CAPTION>
Voxcom Holdings, Inc.
CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT)
Additional
Common stock Preferred stock paid-in Accumulated
--------------------------- -------------------------
Shares Amount Shares Amount capital deficit Total
------------ ------------ ------------ ---------- ------------ ------------ ------------
<S> <C> <C> <C> <C>
Balances at July 1, 1995 100,000 $ 1,000 -- $ -- $ 444,000 $ (714,290) $ (269,290)
Net loss for the year -- -- -- -- -- (709,833) (709,833)
Capital contributions -- -- -- -- 850,000 -- 850,000
------------ ------------ ------------ ------------ ------------ ------------ ------------
Balances at June 30, 1996
(unaudited) 100,000 1,000 -- -- 1,294,000 (1,424,123) (129,123)
Reorganization (Note A) Merger of
Voxcom Holdings, Inc.
And Voxcom Systems, Inc. 4,899,937 (500) -- -- (1,294,000) 1,294,500 --
Notes issued for acquisition
of AmeraPress, Inc. -- -- -- -- -- (10,000,000) (10,000,000)
Distributions to stockholders -- -- -- -- -- (1,920,000) (1,920,000)
Net earnings for the year -- -- -- -- -- 2,923,519 2,923,519
------------ ------------ ------------ ------------ ------------ ------------ ------------
Balances at June 30, 1997 4,999,937 500 -- (9,126,104) (9,125,604)
Issuance of stock 575,000 57 -- -- 574,943 -- 575,000
Conversion of debt -- -- 80,000 8,000,000 -- -- 8,000,000
Net earnings for the period -- -- -- -- -- 1,254,648 1,254,648
------------ ------------ ------------ ------------ ------------ ------------ ------------
Balances at December 31, 1997
(unaudited) 5,574,937 $ 557 80,000 $ 8,000,000 $ 574,943 $ (7,871,456) $ 704,044
============ ============ ============ ============ ============ ============ ============
</TABLE>
The accompanying notes are an integral part of this statement.
F-4
<PAGE>
<TABLE>
<CAPTION>
Voxcom Holdings, Inc.
CONSOLIDATED STATEMENTS OF CASH FLOWS
Six months ended
Year ended June 30, December 31,
------------------------- -------------------------
1996 1997 1996 1997
----------- ---------- ----------- -----------
unaudited) (unaudited)
<S> <C> <C> <C> <C>
Cash flows from operating activities
Net earnings (loss) $ (709,833) $ 2,923,519 $ 303,745 $ 1,254,648
Adjustments to reconcile net earnings (loss)
to net cash provided by
operating activities:
Write-off of receivables -- 258,085 -- 10,657
Depreciation and amortization 5,320 71,489 24,548 117,940
Stock issued for services -- -- -- 25,000
Change in operating assets and liabilities
Receivables -- -- -- (305,048)
Other current assets (354,940) 65,288 172,060 (509,430)
Inventories (60,354) (303,459) (237,346) (18,543)
Other assets (54,830) (67,898) (62,500) (445,295)
Accounts payable and accrued
expenses 466,759 149,245 412,891 1,203,440
Income taxes payable -- 194,541 -- 542,316
----------- ----------- ----------- -----------
Net cash provided by (used in)
operating activities (707,878) 3,290,810 613,398 1,875,685
Cash flows from investing activities
Acquisition of property and equipment (120,687) (263,978) (150,244) (449,189)
Cash flows from financing activities
Capital contributions 850,000 -- -- --
Payments on notes payable to stockholders -- (760,000) -- (1,560,299)
Distributions paid to stockholders -- (1,920,000) (530,000) --
----------- ----------- ----------- -----------
Net cash used in financing activities 850,000 (2,680,000) (530,000) (1,560,299)
Net increase in cash 21,435 346,832 (66,846) (133,803)
Cash at beginning of period 7,420 28,855 28,855 375,687
----------- ----------- ----------- -----------
Cash (overdraft) at end of period $ 28,855 $ 375,687 $ (37,991) $ 241,884
=========== ----------- =========== ===========
Supplemental disclosure of cash flow information:
Interest paid $ -- $ -- $ -- $ 184,659
Income taxes paid $ -- $ -- $ -- $ --
Noncash investing and financing activities
Common stock issued for services and
noncompetition agreements $ -- $ -- $ - $ 575,000
</TABLE>
The accompanying notes are an integral part of this statement.
F-5
<PAGE>
Voxcom Holdings, Inc.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Information with respect to December 31, 1997, the year
ended June 30, 1996 and the six month periods ended
December 31, 1996 and 1997 is unaudited)
NOTE A - BASIS OF PRESENTATION
The accompanying financial statements include the accounts of Voxcom
Holdings, Inc. (Holdings) and its subsidiaries, Voxcom Systems, Inc.
(Systems), AmeraPress, Inc. (AmeraPress) and Home Business Group, Inc.
(HBG), collectively, "the Company."
Holdings, formerly Newcorp One, Inc., was incorporated in 1996. On June 17,
1997, Holdings, which had no operations and no significant assets or
liabilities, issued 4,000,000 shares of its common stock (equal to 80% of
its then outstanding shares) for all of the outstanding capital stock of
Systems.
Since the stockholders of Systems owned 80% of the common stock of Holdings
after the sale of Systems, Systems is deemed to be the acquiring corporation
for accounting purposes. Concurrent with the above transactions, Holdings
acquired all of the outstanding common stock of AmeraPress in exchange for a
$10,000,000 note, payable in 24 equal monthly installments. AmeraPress was
incorporated on June 19, 1997 and succeeded to the business of Voxcom Sales,
L.L.C. (Voxcom Sales).
AmeraPress and Holdings were under common control. Accordingly, the
acquisition of AmeraPress has been accounted for in a manner similar to a
pooling of interests. The $10,000,000 note given in the acquisition of
AmeraPress has been deemed a distribution to the shareholders of AmeraPress
for accounting purposes and resulted in a charge to stockholders' equity of
a like amount.
Home Business Grou, Inc. (HBG), a wholly-owned subsidiary, commenced
operations on November 1, 1997.
The financial statements include the operations of Systems and Voxcom Sales
from July 1, 1996 and AmeraPress and Holdings from June 17, 1997, and HBG
from November 1, 1997.
NOTE B - BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES
Business
AmeraPress sells materials to home-based businesses and produces laminated,
customized sports, trading, and greeting cards sold by those businesses. HBG
conducts seminars and sells introductory kits to home-based businesses.
AmeraPress and its predecessor, Voxcom Sales, L.L.C., accounted for
approximately 89% of total revenues for the year ended June 30, 1997.
Systems sells and provides services related to credit card verification
units for merchants.
Advertising Costs
The Company charges advertising costs to expense when incurred. Advertising
costs for the year ended June 30, 1997 were approximately $213,000.
F-6
<PAGE>
Voxcom Holdings, Inc.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
(Information with respect to December 31, 1997, the year
ended June 30, 1996 and the six month periods ended
December 31, 1996 and 1997 is unaudited)
NOTE B - BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES - Continued
Cash and Cash Equivalents
Cash and cash equivalents include cash in banks and all highly liquid
investments with maturities of three months or less when purchased.
Inventories
Inventories consist principally of finished goods and are stated at the
lower of cost or market; cost is determined using the first-in, first-out
method.
Property and Equipment
Property and equipment are stated at cost. Depreciation is computed on a
straight-line basis over the estimated lives of the individual assets,
ranging from five to seven years.
Revenue Recognition
Sales of products and services are recorded as products are shipped or
services are rendered.
Earnings (Loss) Per Share
The Company adopted Statement of Financial Accounting Standards No. 128
(SFAS No. 128) effective December 31, 1997. In accordance with SFAS No. 128,
the Company computes basic earnings or loss per share based on the weighted
average number of common shares outstanding. Diluted earnings per share is
computed based on the weighted average number of common shares outstanding
plus the number of additional common shares that would have been outstanding
if dilutive potential common shares, consisting of stock purchase warrants,
had been issued. For all periods presented, there was no dilutive effect
from outstanding stock purchase warrants.
The computation of weighted average shares outstanding gives retroactive
effect to the shares issued by Holdings in the acquisition of Systems (Note
A).
Use of Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
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.
F-7
<PAGE>
Voxcom Holdings, Inc.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
(Information with respect to December 31, 1997, the year
ended June 30, 1996 and the six month periods ended
December 31, 1996 and 1997 is unaudited)
NOTE B - BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES - Continued
Interim Financial Statements
The accompanying interim financial statements are unaudited. They have been
prepared in accordance with generally accepted accounting principles for
interim financial information and Article 10 of Regulation S-X. Accordingly,
they do not include all the information and footnotes required by generally
accepted accounting principles for complete financial statements. In the
opinion of management, all adjustments (consisting of normal recurring
accruals) considered necessary for a fair presentation have been included.
Operating results for the interim periods are not necessarily indicative of
the results that may be expected for the full year.
NOTE C - ACQUISITION OF BUSINESS
Effective October 1, 1997, the Company acquired certain assets of a company
engaged in the business of home- based business seminars in consideration
for the assumption of liabilities of approximately $1,100,000. The
acquisition was accounted for as a purchase, and the financial statements
include the operations of the acquired business since October 1, 1997.
If the acquisition had taken place at the beginning of fiscal 1997, the pro
forma effect on net earnings would have been insignificant. Pro forma
revenues (unaudited) are as follows:
Year ended June 30, 1997 $20,320,000
Six months ended December 31:
1996 8,190,000
1997 15,690,000
NOTE D - NOTES PAYABLE
Notes payable to stockholders are due in 24 equal monthly installments of
principal plus interest. The Company has the right to defer all or any part
of any 12 installments by paying all accrued interest required on the date
of payment, provided that all principal and interest shall be paid by June
11, 2001. The notes bear interest at prime, adjusted each December 31. The
interest rate at June 30, 1997 was 8.5%. The notes are collateralized by all
of the outstanding shares of AmeraPress.
In December 1997, $8,000,000 principal amount of notes were exchanged for
80,000 shares of preferred stock. The preferred stock pays no dividends and
is redeemable at the option of the Company.
F-8
<PAGE>
Voxcom Holdings, Inc.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
(Information with respect to December 31, 1997, the year
ended June 30, 1996 and the six month periods ended
December 31, 1996 and 1997 is unaudited)
NOTE E - FAIR VALUE OF FINANCIAL INSTRUMENTS
The fair value of notes payable approximates carrying value because the
notes have variable interest rates. Due to their short-term nature, the fair
value of cash, cash equivalents and accounts payable approximates their
carrying value.
NOTE F - LEASE COMMITMENTS
The Company leases offices and warehouse space and equipment under various
noncancellable lease agreements. Total rent expense was $180,097 for the
year ended June 30, 1997. As of June 30, 1997, the future minimum rental
payments are as follows:
Year ending
June 30,
1998 $139,383
1999 111,096
2000 62,168
2001 56,958
2002 15,762
-------
$385,367
========
In February 1998, the Company entered into a new lease agreement for office
space with a five-year term. Monthly rental payments are approximately
$24,000.
NOTE G - INCOME TAXES
The provision for income taxes for the year ended June 30, 1997, consists of
the following:
Federal $ 52,257
State 142,284
--------
$194,541
========
F-9
<PAGE>
Voxcom Holdings, Inc.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
(Information with respect to December 31, 1997, the year
ended June 30, 1996 and the six month periods ended
December 31, 1996 and 1997 is unaudited)
NOTE G - INCOME TAXES - Continued
Voxcom Sales, the predecessor to AmeraPress, was a limited liability
company. Therefore, federal income taxes on its earnings were the liability
of its stockholders. Following is a reconciliation of income taxes at the
federal statutory rate to income tax expense for the year ended June 30,
1997:
<TABLE>
<S> <C>
Tax at statutory rate $1,060,141
Earnings of Voxcom Sales, not subject to federal tax (838,629)
State income tax, net of federal benefit 131,646
Benefit of utilization of net operating loss carryovers of Systems (157,155)
Other (1,462)
----------
Income tax expense $ 194,541
==========
</TABLE>
At June 30, 1997, the Company had no remaining operating loss carryovers and
no material deferred income tax assets or liabilities.
NOTE H - STOCK PURCHASE WARRANTS
All stockholders of Holdings were given one Class A warrant for each common
share acquired by them. Each warrant entitles the holder to purchase one
share of common stock for $6.00. If not exercised, warrants expire in June
1999. If exercised, the holder will receive one Class B warrant for each
Class A warrant. Each Class B warrant entitles the holder to purchase one
share of common stock for $20.00 and expires in June 1999.
At June 30, 1997, there were 4,999,937 Class A warrants outstanding; none
had been exercised.
In March 1998, the Company reduced the exercise price of the class A
warrants to $4.00.
F-10
<PAGE>
Voxcom Holdings, Inc.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
(Information with respect to December 31, 1997, the year
ended June 30, 1996 and the six month periods ended
December 31, 1996 and 1997 is unaudited)
NOTE I - INDUSTRY SEGMENTS
The Company operates in two industry segments, as described in Note B.
Financial information by segment as of June 30, 1997 and for the year then
ended is as follows:
<TABLE>
<S> <C> <C>
Home-based Credit card
businesses verification Corporate Consolidated
Sales to unaffiliated customers $12,008,786 $1,411,980 $ - $13,420,766
========== ========= === ==========
Operating income $ 2,700,086 $ 462,221 $ - $ 3,162,307
Corporate expenses - - (44,247) (44,247)
--- --- ------- --------
Earnings before income taxes $ 2,700,086 $ 462,221 $(44,247) $ 3,118,060
========== ======== ======= ==========
Identifiable assets at June 30, 1997 $ 1,168,394 $ 144,047 $ - $ 1,312,441
========== ======== ======= ==========
Capital expenditures $ 250,208 $ 13,770 $ - $ 263,978
========== ======= ======= ==========
</TABLE>
Operating income is revenue less operating expenses, exclusive of corporate
interest expense.
NOTE J - FEDERAL TRADE COMMISSION SETTLEMENT
In April 1998, the Company and the Federal Trade Commission (FTC) agreed to
a compromise and settlement of a lawsuit filed by the FTC in February 1998.
The FTC had alleged violations of the FTC Act in connection with the
Company's business of marketing sales opportunities for home-based
businesses.
The agreement resulted in refunds by the Company to distributors in the
amount of approximately $145,000 which were due at the time the lawsuit was
filed, plus an additional $320,000 which arose during the FTC's
investigation after the lawsuit was filed. The Company believes that many of
the distributors were led to believe during the investigation that the
Company was being closed. The Company has a policy of making refunds to
distributors for a period of ten days after receipt of goods.
Legal fees in connection with this matter were approximately $500,000.
F-11
<PAGE>
Voxcom Holdings, Inc.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
(Information with respect to December 31, 1997, the year
ended June 30, 1996 and the six month periods ended
December 31, 1996 and 1997 is unaudited)
NOTE K - PRO FORMA DATA
As discussed in Note G, Voxcom Sales was a limited liability company, and
income taxes on its earnings were the liability of its shareholders. The
unaudited pro forma income tax information included in the statements of
earnings presents income tax expense as though the Company had been subject
to federal and state income taxes for all periods presented.
F-12
<PAGE>
PART III
Item 1. Index to Exhibits
The following list describes the exhibits filed as part of this
registration statement on Form 10-SB:
Exhibit No. Description of Document
- ----------- -----------------------
2.01 Agreement and Plan of Reorganization, dated June 9, 1997, among
Newcorp One, Inc. and the shareholders of Voxcom Systems, Inc.
2.02.1 Stock Purchase Agreement, dated June 30, 1997, among Voxcom
Holdings, Inc. and the shareholders of AmeraPress, Inc.
2.02.2 Promissory Note, dated June 30, 1997, in connection with Stock
Purchase Agreement between Voxcom Holdings, Inc. and the
Shareholders of AmeraPress, Inc.
2.02.3 Security Agreement-Pledge, dated June 30, 1997, in
connection with Promissory Note between Voxcom Holdings, Inc. and
the Shareholders of AmeraPress, Inc.
2.03.1 Stock Purchase Agreement regarding MAXpc
2.03.2 Employment Agreement with Gary raabe
3.01 Restated Articles of Incorporation of Newcorp
One, Inc., dated June 12, 1997.
3.02 By-laws of Voxcom Holdings, Inc.
3.03 Certificate of Decrease in Authorized and
Issued Shares.
3.04 Certificate of Designation regarding Series A Preferred Stock
III-1
<PAGE>
10.01 Consulting Agreement and Covenant Not to
Compete, dated July 1, 1997, between the Company
and Kim Crowther and Brian Jensen.
10.02 1997 Stock Bonus Plan
10.03 Promissory Note and Purchase Money Security
Agreement between the Company and General
Binding Corporation, dated March 27, 1997.
10.04 Settlement Agreement with FTC
11.01 Earnings per Share
21.01 Subsidiaries
27.01 Financial Data Schedule
III-2
AGREEMENT AND PLAN OF REORGANIZATION
Agreement and Plan of Reorganization ("Agreement") between NEWCORP-ONE,
INC. a Nevada corporation ("Issuer"), and Lawrence R. Biggs, Jr., Donald G.
McLellan, Vision Finance and Management and Larry Cahill ("Shareholders"), being
the owners of record of all of the issued and outstanding stock of Voxcom
Systems, Inc., a Delaware corporation ("Company").
WHEREAS, Issuer wishes to acquire and the Shareholders wish to transfer
all of the issued and outstanding stock of the Company in a transaction intended
to qualify as a reorganization within the meaning of Section 368(a)(1)(B) of the
Internal Revenue Code of l986, as amended.
NOW, THEREFORE, Issuer and the Shareholders adopt this plan of
reorganization and agree as follows:
SECTION 1. EXCHANGE OF STOCK
1.01 Number of Shares. The Shareholders agree to transfer to Issuer at
the Closing an aggregate of 100,000 shares of common stock of the Company, in
exchange for an aggregate of 4,000,000 post-split shares of voting common stock
of Issuer, $.0001 par value per share, and 4,000,000 post-split Class A Warrants
and Class B Warrants, all to be issued at the Closing to the Shareholders in
proportion to their ownership of shares of the Company (the "Issuer Shares").
1.02 Delivery of Certificates by Shareholders, The transfer of Company
shares by the Shareholders shall be effected by the delivery to Issuer at the
Closing of certificates representing the transferred shares endorsed in blank or
accompanied by stock powers executed in blank, affixed with all necessary
transfer tax and other revenue stamps, acquired at the Shareholders' expense.
1.03 Further Assurances. At the Closing and from time to time
thereafter, the parties shall execute such additional instruments and take such
other actions as either may request in order more effectively to sell, transfer
and assign the transferred stock of the Company to Issuer and to confirm
Issuer's title thereto for the Shareholders and to acquire the Issuer Shares.
SECTION 2. CLOSING
2.01 Contemporaneous Closing. The Closing contemplated by Section 1.01
shall be held at the offices of Glast, Phillips & Murray, P.C., counsel to the
Shareholders, contemporaneously with the execution of this Agreement.
2.02 Actions. At the Closing, the parties shall execute and deliver the
documents and take all other actions contemplated by this Agreement.
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SECTION 3. REPRESENTATIONS AND WARRANTIES
OF THE SHAREHOLDERS
The Shareholders severally, but not jointly, represent and warrant to
the Issuer as follows:
3.01 Corporate Status. Company is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware and is
licensed or qualified as a foreign corporation in all locations in which the
nature of its business or the character or ownership of its properties makes
such licensing or qualification necessary.
3.0 Capitalization. The authorized capital stock of the Company
consists of 1,000,000 authorized shares of Common Stock, par value $0.01 per
share, of which 100,000 shares are issued and outstanding, all fully paid and
nonassessable.
3.03 Financial Statements. The unaudited financial statements of
Company furnished to Issuer consisting of balance sheets as of December 31,
1996, and related statements of income for the twelve months then ended, are
materially correct and fairly present the financial condition of Company and its
predecessor as of the dates and for the periods presented, and except as noted
such statements were prepared in accordance with generally accepted accounting
principles consistently applied.
3.04 Undisclosed Liabilities. Company has no liabilities of any nature
except to the extent reflected or reserved against in Company's Balance Sheet,
whether accrued, absolute, contingent or otherwise, including, without
limitation, tax liabilities and interest due or to become due, except as may
have been incurred in the ordinary course of business since the date of the
Financial Statements.
3.05 Interim Changes. Between the date of the Financial Statements and
the date of this Agreement, there have not been, except as set forth in the
Disclosure Schedule (1) any changes in Company's financial condition, assets,
liabilities or business which, in the aggregate, have been materially adverse;
(2) any damage, destruction or loss of or to Company's property, whether or not
covered by insurance; (3) any declaration or payment of any dividends or other
distribution in respect of Company's capital stock, or any direct or indirect
redemption, purchase or other acquisition or any such stock; or (4) any increase
paid or agreed to in the compensation, retirement benefits or other commitments
to employees.
3.06 Title to Property. Company has good and merchantable title to all
properties and assets, real and personal, reflected in Company's latest Balance
Sheet, except as since sold or otherwise disposed of in the ordinary course of
business, and Company's properties and assets are subject to no mortgage,
pledge, lien or encumbrance, except for liens shown therein.
3.07 Litigation. There is no litigation or proceeding pending, or
to Shareholders' knowledge threatened, against or relating to Company, its
properties or business, except as set forth
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in the Disclosure Schedule.
3.08 Title to Shares. The Shareholders are the owners, free and clear
of any liens and encumbrances, of the number of Company shares, which the
Shareholders have contracted to exchange.
SECTION 4. REPRESENTATIONS, WARRANTIES
AND COVENANTS OF ISSUER
Issuer represents and warrants to, and covenants with, the Shareholders
as follows:
4.01 Corporate Status. Issuer is a corporation duly organized, validly
existing and in good standing under the laws of the State of Nevada and is
licensed or qualified as a foreign corporation in all states in which the nature
of its business or the character or ownership of its properties makes such
licensing or qualification necessary.
4.02 Capitalization. The authorized capital stock of Issuer following
amendment of its Articles of Incorporation consists of 100,000,000 shares of
capital stock, having a par value of $.0001 per share, of which 5,000,000 shares
are issued and outstanding, all fully paid and non assessable, following the
issuance thereof at the Closing pursuant to the Order Confirming Debtor's Second
Amended Plan of Reorganization (as modified) in Case No. LA 89-15370-KL in the
United States Bankruptcy Court, Central District of California (the "Order") and
after declaration of a one- for-four reverse split of such shares.
4.03 Financial Statement. As of the date of the Closing, Issuer
represents that the Financial Statements of Issuer hereto attached as Exhibit A,
are accurate in accordance with generally accepted accounting principles (the
"Issuer Financial Statements").
4.04 Undisclosed Liabilities. Issuer has no liabilities of any nature
except to the extent reflected in the Issuer Financial Statements. Issuer has
not conducted any business whatsoever since the date of its incorporation.
4.05 Interim Changes. Between the date of the Issuer Financial
Statements, and the date of this Agreement, there have not been, except as set
forth in the Disclosure Schedule (1) any changes in Issuer's financial
condition, assets, liabilities or business which, in the aggregate, have been
materially adverse; (2) any damage, destruction or loss of or to Issuer's
property, whether or not covered by insurance; (3) any declaration or payment of
any dividends or other distribution in respect of Issuer's capital stock, or any
direct or indirect redemption, purchase or other acquisition of any such stock;
or (4) any increase paid or agreed to in the compensation, retirement benefits
or other commitments to employees.
4.06 Title to Property. Issuer has good and merchantable title to all
properties and assets, real and personal, reflected in Issuer's latest Balance
Sheet, if any, except as since sold or otherwise
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disposed of in the ordinary course of business, and Issuer's properties and
assets are subject to no mortgage, pledge, lien or encumbrance, except for liens
shown therein.
4.07 Litigation. There is no litigation or proceeding pending, or to
Issuer's knowledge threatened, against or relating to Issuer, its properties or
business, except as set forth in the Disclosure Schedule.
4.08 Investment Intent. Issuer is acquiring the Company shares to be
transferred to it under this Agreement for investment and not with a view to the
sale or distribution thereof, and Issuer has no commitment or present intention
to liquidate Company or to sell or otherwise dispose of its stock.
4.09 Corporate Authority. Issuer has full corporate power and authority
to enter into this Agreement and to carry out its obligations hereunder and will
deliver to the Shareholders at the Closing a certified copy of resolutions of
its Board of Directors authorizing execution of this Agreement by its officers
and part performance thereunder.
4.10 Due Authorization. Execution of this Agreement and performance by
Issuer hereunder has been duly authorized by all requisite corporate and
shareholder action on the part of Issuer, and this Agreement constitutes a valid
and binding obligation of Issuer. Performance hereunder will not violate any
provision of Issuer's Articles of Incorporation, Bylaws, agreements, mortgages,
agreements with third parties or other commitments.
4.11 Court Authorization. Issuer will furnish a legal opinion to such
an extent that this Agreement and the transactions hereby are within the
disclosure document previously presented to the Bankruptcy Court, are approved
by the Bankruptcy Court pursuant to the Order, and that no further approval of
the Bankruptcy Court is needed.
SECTION 5. CONTEMPORANEOUS TRANSACTIONS
The following transactions shall have taken place at or prior to the
Closing and shall be conditions precedent to the obligation of any party to
close this Agreement.
5.01 Articles of Incorporation and Bylaws. Issuer shall have amended
its Articles of Incorporation in the form attached hereto as Exhibit A, and
shall have filed such amendment of record with the Secretary of State of Nevada.
Issuer shall have adopted new Bylaws in the form attached hereto as Exhibit B.
5.02 Issuances of Stock. Issuer shall have declared a one-for-four
reverse split of its Common Stock and distributed 1,000,000 shares of its common
stock and 1,000,000 Class A Warrants, as follows:
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Common Class A
Shareholder Shares Warrants
----------- ------ --------
Weaver creditors in Plan Pool 82,500 82,500
Certificate of indebtedness holders 125,000 125,000
Weaver shareholders 17,500 17,500
Administrative Claims 25,000 25,000
C. D. Financial, Inc. 250,000 250,000
Texas Equity, Inc. 250,000 250,000
JANDE International Holdings, 250,000 250,000
LLC
5.03 Market Makers. Issuer and the Company shall have arranged for at
least two member firms of the National Association of Securities Dealers, Inc.
("NASD") to act as market makers for the Issuer Shares and the Warrants, and
shall have supplied such market makers with the information required by SEC Rule
15c2-11.
5.04 Transfer Agent. Issuer shall have contracted with OTR/Oxford
Transfer & Registrar Agency, Inc. to serve as the transfer agent for the Issuer
Shares and Warrants after the Closing.
5.05 Certificates. Issuer and Company shall have prepared certificates
representing the Issuer Shares and Warrants in a form that complies with all
rules of the NASD, the Securities and Exchange Commission, and the State of
Nevada. The Company's counsel shall obtain CUSIP numbers for the Issuer Shares
and Warrants.
5.06 Resignations. All directors of Issuer except Daniel Lezak shall
resign prior to the Closing. Daniel Lezak shall act as director to elect the
Shareholders as directors of the Issuer, whereupon he shall resign as a
director. All officers of the Issuer shall resign at the Closing.
5.07 Lock-ups. C. D. Financial, Inc., Texas Equity, Inc. and JANDE
International Holdings, Inc. shall execute letters in the form of Exhibit C
attached hereto agreeing to certain restrictions on the right to sell or dispose
of any securities of the Issuer and certain other matters.
5.08 Consulting Agreement. Issuer shall execute and deliver that
certain Independent Consulting Agreement in the form attached hereto as Exhibit
D.
5.09 AmeraPress, Inc. Issuer shall have acquired by purchase all of the
common stock of AmeraPress, Inc., a Nevada corporation and successor to Voxcom
Sales, LLC, pursuant to the terms of the Stock Purchase Agreement attached
hereto as Exhibit E.
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SECTION 6. INDEMNIFICATION
6.01 Indemnification of Issuer. The Shareholders severally (and not
jointly) agree to indemnify Issuer against any loss, damage or expense
(including reasonable attorneys' fees) suffered by Issuer from (1) any breach by
the Shareholders of this Agreement; or (2) any inaccuracy in or breach of any of
the representations, warranties or covenants by the Shareholders herein;
provided, however that (a) Issuer shall be entitled to assert rights of
indemnification hereunder only if and to the extent that it suffers losses,
damages and expenses (including reasonable attorneys' fees) exceeding $50,000 in
the aggregate; and (b) Issuer shall give notice of any claims hereunder within
the twenty-four (24) month period beginning on the date of the Closing. No loss,
damage or expense shall be deemed to have been sustained by Issuer to the extent
of insurance proceeds paid to, or tax benefits realizable by, Issuer or Company
as a result of the event giving rise to such right to indemnification.
6.02 Indemnification of Shareholders. Issuer agrees to Indemnify the
Shareholders against any loss damage or expense (including reasonable attorneys'
fees) suffered by any of the Shareholders from (1) any breach by Issuer of this
Agreement; or (2) any inaccuracy in or breach of any of Issuer's
representations, warranties or covenants herein.
6.03 Defense of Claims. Upon obtaining knowledge thereof, the
indemnified party shall promptly notify the indemnifying party of any claim
which has given or could give rise to a right of indemnification under this
Agreement If the right of indemnification relates to a claim asserted by a third
party against the indemnified party, the indemnifying party shall have the right
to employ counsel acceptable to the indemnified party to cooperate in the
defense of any such claim. So long as the indemnifying party is defending any
such claim in good faith, the indemnified party will not settle such claim. If
the indemnifying party does not elect to defend any such claim, the indemnified
party shall have no obligation to do so.
SECTION 7. GENERAL PROVISIONS
7.01 Further Assurances. At any time, and from time to time, after the
Effective Date, each Company will execute such additional instruments and take
such action as may be reasonably requested by the other party to confirm or
perfect title to any property transferred hereunder or otherwise to carry out
the intent and purposes of this Agreement.
7.02 Waiver. Any failure on the party of either party hereto to comply
with any of its obligations, agreements or conditions hereunder may be waived in
writing by the party to who such compliance is owed.
7.03 Brokers. Each party represents to the other party that no broker
or finder has acted for it in connection with this Agreement, and agrees to
indemnify and hold harmless the other party against any fee, loss or expense
arising out of claims by brokers or finders employed or alleged to have been
employed by it.
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7.04 Notices. All notices and other communications hereunder shall be
in writing and shall be deemed to have been given if delivered in person or sent
by prepaid first-class registered or certified mail, return receipt requested,
as follows:
To:
NEWCORP-ONE
23548 Calabasas Road
Suite 205
Calabasasas, CA. 91302
To Shareholders:
c/o Lawrence R. Biggs, Jr.
14990 Landmark Blvd.
Suite 250
Dallas, Texas 75240
7.05 Entire Agreement. This Agreement constitutes the entire agreement
between the parties and supersedes and cancels any other agreement,
representation, or communication, whether oral or written, between the parties
hereto relating to the transactions contemplated herein or the subject matter
hereof.
7.06 Headings. The section and subsection headings in this Agreement
are inserted for convenience only and shall not affect in any way the meaning or
interpretation of this Agreement.
7.07 Governing Law. This Agreement shall be governed by and construed
and enforced in accordance with the laws of the State of Nevada.
7.08 Assignment. This Agreement shall inure to the benefit of, and be
binding upon, the parties hereto and their successors and assigns; provided,
however, that any assignment by either party of its rights under this Agreement
without the written consent of the other party shall be void.
7.09 Counterparts. This Agreement may be executed simultaneously in two
or more counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
7.10 Disclosure Schedule. The Disclosure Schedule shall be attached
hereto prior to execution and shall contain any matter for which information may
be called for by any Section of this Agreement in order to clarify, amend or
render accurate such information.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement the
date first above written.
NEWCORP ONE, INC.
By:/s/ Daniel Lezak
--------------------------
Name: Daniel Lezak, President
/s/ Lawrence R. Biggs, Jr.
-----------------------------
Lawrence R. Biggs, Jr.
/s/ Donald G. McLellan
-----------------------------
Donald G. McLellan
/s/ Larry Cahill
-----------------------------
Larry Cahill
VISION FINANCE AND MANAGEMENT
By:/s/ Donald G. McLellan
--------------------------
Donald G. McLellan, Agent
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EXHIBIT A IS SET FORTH
IN EXHIBIT 3.01
EXHIBIT B IS SET FORTH
IN EXHIBIT 3.02
9
<PAGE>
EXHIBIT C
June 11, 1997
Voxcom Holdings, Inc.
14990 Landmark Blvd., Suite 250
Dallas, Texas 75240
Pursuant to the terms of the Agreement and Plan of Reorganization,
dated the date hereof (the "Agreement"), by and among Voxcom Holdings, Inc.,
f/k/a Newcorp-One, Inc., a Nevada corporation ("Voxcom") and Lawrence R. Biggs,
Jr., Larry Cahill and Donald G. McLellan (the "Shareholders"), the Shareholders
will acquire control of Voxcom and contribute an operating business as
contemplated by the Order Confirming Debtor's Second Amended Plan of
Reorganization (as modified) in Case No. LA 89-15370-KL in the United States
Bankruptcy Court, Central District of California (the "Order"). Pursuant to the
Order and the Agreement, the undersigned is entitled to receive 1,000,000 shares
of unrestricted common stock, 1,000,000 Class A Warrants and 1,000,000 Class B
Warrants of Voxcom (the "Shares") representing 5% of shares outstanding
following the issuance to the Shareholders and others.
I represent and warrant to, and covenant with, Voxcom as follows:
A. I shall not make any sale, transfer or other disposition of
any Shares issued to me in violation of the Securities Act of
1933 (the "Act") or the Rules and Regulations under the Act.
B. I have no present intention to sell or dispose of any of the
Shares.
C. I agree that, for a period of one year from the date hereof, I
will not offer, sell, transfer or convey any of the Shares,
whether in the open market or otherwise.
D. My Shares shall be callable, and I hereby grant to Voxcom the
right and option to purchase such shares for a price of $.0001
per share, in the event the issuance of Shares to the
Shareholders of Voxcom fails to comply with the Order or with
Section 1145 of the U.S. Bankruptcy Code (11 U.S.C. ss.1145).
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Prior to any transfer of any of the Shares, I will give notice to
Voxcom of my intention to effect such offer, sale or transfer, describing the
proposed transaction in sufficient detail to enable Voxcom and its counsel to
determine that the proposed transaction will not violate the Act.
Sincerely,
----------------------------
AGREED AND ACKNOWLEDGED:
VOXCOM HOLDINGS, INC.
By:
Name:
Title:
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INDEPENDENT CONSULTING AGREEMENT
--------------------------------
THIS INDEPENDENT CONSULTING AGREEMENT (the "Agreement") is made and
entered into as of this _____ day of ___________ , 1997, by and between Voxcom
Holdings, Inc. a Nevada corporation formerly known as Newcorp One, Inc. (the
"Company") and B. D. Brooke & Company, a Nevada corporation ("BDB") and made
with respect to the following facts:
(A) BDB is a Nevada corporation and is not directly regulated by
any Regulatory or Self- Regulatory agency and its business
includes providing financial and other advice to publicly held
companies.
(B) The Company requires such services as part of its business.
NOW, THEREFORE, in consideration of the promises and mutual promises
herein contained, the parties hereto agree as follows:
1. INDEPENDENT CONSULTANT: The Company hereby retains BDB as an
independent consultant to provide financial and other business advice to the
company. In providing the services hereunder, BDB may introduce the Company to
investors, lenders, and Broker/Dealers both private and institutional. The
Company shall maintain the confidentiality of such persons or entities and shall
not contact same without the written consent of BDB, BDB may provide similar and
other services to other companies and may receive compensation from the other
Parties involved in the providing of financing , and/or other services to the
Company.
2. INFORMATION REGARDING THE COMPANY: In order for BDB to perform
under this Agreement, the Company shall from time to time be required to
complete certain forms, submit information and deliver documents to BDB
including substantial financial and business information regarding the Company
(the "Information"). The failure of the Company to accurately and completely
deliver all requested Information to BDB within three (3) weeks of the request
therefore made by BDB, unless otherwise agreed to in writing, shall constitute a
breach of this Agreement by the Company upon which BDB may, in its sole
discretion, stop providing services hereunder, discontinue work on the Project
or terminate this Agreement.
3. CONFIDENTIALITY: All Information that the Company deems
confidential shall be clearly labeled as such prior to delivery to BDB. BDB
shall maintain the confidentially of all such labeled information except when
required by law or if such Information is available from another source not
required to maintain the confidentiality of the Information. This Section 3
shall survive this Agreement.
4. CONSIDERATION: In consideration for the services provided by
BDB to the Company hereunder, the Company shall pay the total of $40,000.00. The
consideration shall be paid
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<PAGE>
$20,000.00 immediately upon acceptance of this agreement, and $20,000.00 paid
upon completion, which shall be interpreted as the date in which a definitive
agreement is closed by and between the Company and Lawrence R. Biggs, Jr.,
Donald R. McLellan, and Larry Cahill. Such payments then due shall be proceeded
by an invoice from BDB which shall be marked payable upon receipt.
(a) Upon the completion of the proposed merger by and between The
Company and Issuer, the resulting merged Company may extend this contract and
elect to pay BDB a sum that shall be negotiated at that time, but shall be no
lower than $180.00 per hour plus expenses.
(b) The failure of the Company to accurately comply with this section 4
and subsection 4(a), unless otherwise agreed to in writing, shall constitute a
breach of this Agreement by the Company, upon which BDB may, in its sole
discretion, stop providing services hereunder, and terminate this Agreement.
Additionally, BDB shall be reimbursed by the Company for all reasonable
necessary out-of pocket expenses incurred by BDB in connection with the
performance of its obligations hereunder as provided in Section 8 hereof. The
fees payable hereunder are non-refundable.
5. EXCLUSIVITY: The Company shall have the non-exclusive right to
employ BDB as a independent consultant to it. If at any time during the term of
this Agreement. or within six months after its termination, the Company enters
into a contract for the financing or other services, if any, from sources
introduced to the Company by BDB, BDB shall be entitled to all of the
consideration provided in Section 4 above.
6. TERM: The term of this Agreement shall commence on the date hereof
and shall continue, for six months (6) from the date hereto (the "Period") with
mutual six months (6) extension thereof, unless terminated earlier by BDB
pursuant to Section 2 or Section 4 hereof.
7. INDEMNIFICATION. The Company shall indemnify, defend and hold
harmless BDB and all of its Directors, shareholders, employees and agents from
and against any and all causes of action, claims demands costs, damages,
liabilities, losses, obligations and expenses (including actual attorneys fees)
arising out of or connected with, or claimed to arise out of or be commenced
with, any act performed or omitted to be performed under this agreement. If the
Company is attempting to obtain financing, BDB makes no representations as to
the outcome of any efforts in that regard and the Company acknowledges that BDB
shall not be liable for the Company's failure to obtain any financing as a
result of BDB's services hereunder.
8. EXPENSES: BDB shall be reimbursed by the Company for all reasonable
and necessary out-of-pocket expenses incurred by BDB in connection with the
performance of its obligations hereunder. Any travel and or related expenses
shall require advance reimbursement by the Company, and as such the approval of
the Company.
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10. CONSEQUENTIAL DAMAGES: BDB shall not be liable to the Company for
consequential or incidental damages, including, but not limited to, lost profits
or sales or unnecessary expenses, resulting from the failure of BDB services
hereunder. or to proposed financing not successfully completed.
11. ATTORNEYS' FEES AND EXPENSES: In the event that it should become
necessary for any party to this Agreement to bring an action, including
arbitration, either at law or in equity, to enforce or interpret the terms of
this Agreement, the prevailing party in such action shall be entitled to recover
its reasonable attorneys' fees and expenses as a part of any judgment therein,
in addition to any other award which may be granted.
12. APPLICABLE LAW/VENUE: This Agreement is executed and intended to be
performed in the State of Texas, United States of America, and the laws of such
state and nation shall govern its interpretation and effect. If suit is
instituted by any party hereto for any cause or matter arising from or in
connection with the respective rights or obligations of the parties hereunder,
the sole jurisdiction and venue for such action shall be the State District
Courts of Dallas County, Texas.
13. NOTICE: Any and all notices or other communications required or
permitted by this Agreement or by law shall be deemed served and given when
actually received by personal delivery, by electronic communication, confirmed
by certified mail within ten business days, or by certified mail, return receipt
requested, with first class postage prepaid thereon, to the Party to whom such
notice or communication is directed, addressed as follows:
If to Company:
AmeraPress, Inc.
c/o Lawrence R. Biggs, Jr.
14990 Landmark Blvd., Suite 250
Dallas, Texas 75240
If to BDB:
B. D. Brooke & Company
P. O. Box 1506
Agoura Hills, CA 91376-15C6
With copies to:
Rex E. Crim, President
Texas Equity, Inc.
3030 McKinney Suite 1501
Dallas, Texas 75204
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<PAGE>
Each of the parties hereto may change its address for purposes of this Section
13 by giving written notice of such change in the manner provided for in this
Section 13.
14. SEVERABILITY: Any provision in this Agreement which is, by
competent judicial authority, declared illegal, invalid or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such illegality, invalidity or unenforceability without invalidating the
remaining provisions hereto or affecting the legality, validity or
enforceability of such provision in any other jurisdiction. The parties hereto
agree to negotiate in good faith to replace any illegal, invalid or
unenforceable provision of this Agreement with a legal, valid and enforceable
provision that, to the extent possible, will preserve the economic bargain of
this Agreement, or otherwise to amend this Agreement, including the provision
relating to choice of law, to achieve such result.
15. WAIVER: No Waiver of any of the provisions of this Agreement shall
be deemed, or shall constitute, a Waiver of any other provision, whether or not
similar, nor shall any Waiver constitute a continuing Waiver. No Waiver shall be
binding unless executed in writing by the party making the Waiver.
16. SUCCESSOR: This Agreement shall be binding upon the parties, and
upon their respective representatives, administrators, successor and assigns,
and shall inure to the benefit of the parties and others released herein and to
their respective heirs, representative, executors, administrators, successors
and assigns.
17. ARBITRATION: Any controversy, arising out of or relating to this
Agreement, or breach of this Agreement, shall be initially submitted to
non-binding Arbitration in accordance with the commercial arbitration rules of
the American Arbitration Association, and judgment of the award rendered by the
arbitrators may be entered in any court having jurisdiction. There shall be
three (3) arbitrators, on to be chosen directly by each party at will, and the
third arbitrator to be selected by the two (2) arbitrators so chosen. Each party
shall pay the fees of the arbitrator he selects as well as the fees of his
attorneys, the expenses of his witnesses and any other expenses connected with
presenting his claim. The costs of the arbitration, including the cost of any
record or transcript of the arbitration, administrative fees, the fee of the
third arbitrator, and all other fees and costs, shall be borne equally by the
parties.
18. CONSTRUCTION:
(A) The language of this Agreement shall in all cases by construed
as a whole, according to its fair meaning, and not strictly
for or against either of the parties,
(B) The section headings used in this Agreement are intended
solely for convenience of reference and shall not in any
manner amplify, limit, modify or otherwise be used in the
interpretation of any of the provision hereof.
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19. COUNTERPARTS: This Agreement may be executed in any number of
counterparts with effect as if all parties had signed the same document. All
such counterparts shall be deemed an original, shall be construed together and
shall constitute on and the same instrument.
20. ENTIRE AGREEMENT; AMENDMENTS AGREEMENT: This Agreement contains the
entire agreement between the parties hereto with respect to the matter hereof.
The provisions of this Agreement may not be modified or waived except in a
writing signed by each of the parties hereto.
21. REGULATORY AUTHORITIES: This Agreement shall be the subject to the
approval of those regulatory authorities having jurisdiction over such an
Agreement.
22. Time shall be of the essence of this Agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.
VOXCOM HOLDINGS, INC.
By:________________________________
Lawrence R. Biggs, Jr.
B.D. BROOKE & COMPANY
By:________________________________
Ely Mandell, President
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EXHIBIT E IS SET FORTH IN EXHIBIT 2.02.1
EXHIBIT E-1 IS SET FORTH IN EXHIBIT 2.02.2
EXHIBIT E-2 IS SET FORTH IN EXHIBIT 2.02.3
17
STOCK PURCHASE AGREEMENT
Stock Purchase Agreement ("Agreement") dated June 30, 1997, between
VOXCOM HOLDINGS, INC., formerly known as NEWCORP-ONE, INC. a Nevada corporation
("Purchaser"), and Lawrence R. Biggs, Jr., Donald G. McLellan and Larry Cahill
("Shareholders"), being the owners of record of all of the issued and
outstanding stock of AmeraPress, Inc., a Nevada corporation ("Company").
WHEREAS, Purchaser wishes to acquire and the Shareholders wish to
transfer all of the issued and outstanding stock of the Company to Purchaser,
and Purchaser desires to purchase same.
NOW, THEREFORE, Purchaser and the Shareholders adopt this plan of
reorganization and agree as follows:
SECTION 1. PURCHASE OF STOCK
1.01 Number of Shares. The Shareholders agree to transfer to Purchaser
at the Closing an aggregate of 10,000 shares of common stock of the Company,
representing 100% of shares outstanding of the Company in exchange for
Purchaser's Promissory Note in the principal amount of $10,000,000 in the form
attached as Exhibit E-1 to this Agreement (the "Note") secured by a pledge of
the stock pursuant to the Pledge Agreement in the form of Exhibit E-2.
1.02 Delivery of Certificates by Shareholders, The transfer of Company
shares by the Shareholders shall be effected by the delivery to Purchaser at the
Closing of certificates representing the transferred shares endorsed in blank or
accompanied by stock powers executed in blank, affixed with all necessary
transfer tax and other revenue stamps, acquired at the Shareholders' expense.
1.03 Further Assurances. At the Closing and from time to time
thereafter, the parties shall execute such additional instruments and take such
other actions as either may request in order more effectively to sell, transfer
and assign the transferred stock to Purchaser and to confirm Purchaser's title
thereto.
SECTION 2. CLOSING
2.01 Contemporaneous Closing. The Closing contemplated by Section 1.01
shall be held at the offices of Glast, Phillips & Murray, P.C., counsel to the
Shareholders, contemporaneously with the execution of this Agreement.
2.02 Actions. At the Closing, the parties shall execute and deliver the
documents and take all other actions contemplated by this Agreement.
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SECTION 3. REPRESENTATIONS AND WARRANTIES
OF THE SHAREHOLDERS
The Shareholders severally, but not jointly, represent and warrant to
the Purchaser as follows:
3.01 Corporate Status. The Company is a corporation duly organized,
validly existing and in good standing under the laws of the State of Nevada and
is licensed or qualified as a foreign corporation in all locations in which the
nature of its business or the character or ownership of its properties makes
such licensing or qualification necessary.
3.0 Capitalization. The authorized capital stock of the Company
consists of 100,000 authorized shares of Common Stock, par value $0.01 per
share, of which 10,000 are issued and outstanding, all fully paid and
nonassessable.
3.03 Financial Statements. The unaudited financial statements of
Company furnished to Purchaser consisting of balance sheets as of December 31,
1996, and related statements of income for the twelve months then ended, are
materially correct and fairly present the financial condition of Company and its
predecessor as of the dates and for the periods presented, and except as noted
such statements were prepared in accordance with generally accepted accounting
principles consistently applied.
3.04 Undisclosed Liabilities. Company has no liabilities of any nature
except to the extent reflected or reserved against in Company's Balance Sheet,
whether accrued, absolute, contingent or otherwise, including, without
limitation, tax liabilities and interest due or to become due, except as may
have been incurred in the ordinary course of business since the date of the
Financial Statements.
3.05 Interim Changes. Between the date of the Financial Statements and
the date of this Agreement, there have not been, except as set forth in the
Disclosure Schedule (1) any changes in Company's financial condition, assets,
liabilities or business which, in the aggregate, have been materially adverse;
(2) any damage, destruction or loss of or to Company's property, whether or not
covered by insurance; (3) any declaration or payment of any dividends or other
distribution in respect of Company's capital stock, or any direct or indirect
redemption, purchase or other acquisition or any such stock; or (4) any increase
paid or agreed to in the compensation, retirement benefits or other commitments
to employees.
3.06 Title to Property. Company has good and merchantable title to all
properties and assets, real and personal, reflected in Company's latest Balance
Sheet, except as since sold or otherwise disposed of in the ordinary course of
business, and Company's properties and assets are subject to no mortgage,
pledge, lien or encumbrance, except for liens shown therein.
3.07 Litigation. There is no litigation or proceeding pending, or to
Shareholders' knowledge threatened, against or relating to Company, its
properties or business, except as set forth
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in the Disclosure Schedule.
3.08 Title to Shares. The Shareholders are the owners, free and clear
of any liens and encumbrances, of the number of Company shares, which the
Shareholders have contracted to exchange.
SECTION 4. REPRESENTATIONS, WARRANTIES
AND COVENANTS OF PURCHASER
Purchaser represents and warrants to, and covenants with, the
Shareholders as follows:
4.01 Corporate Status. Purchaser is a corporation duly organized,
validly existing and in good standing under the laws of the State of Nevada and
is licensed or qualified as a foreign corporation in all states in which the
nature of its business or the character or ownership of its properties makes
such licensing or qualification necessary.
4.02 Capitalization. The authorized capital stock of Purchaser
following amendment of its Articles of Incorporation, consists of 100,000,000
shares of capital stock, having a par value of $.0001 per share, of which
5,000,000 shares are issued and outstanding, all fully paid and non assessable,
following the issuance thereof pursuant to the Order Confirming Debtor's Second
Amended Plan of Reorganization (as modified) in Case No. LA 89-15370-KL in the
United States Bankruptcy Court, Central District of California (the "Order") and
the Agreement and Plan of Reorganization among Purchaser the Shareholders dated
the date hereof.
4.03 Financial Statement. As of the date of the Closing, Purchaser
represents that the Financial Statements of Purchaser hereto attached as Exhibit
A, are accurate in accordance with generally accepted accounting principles (the
"Purchaser Financial Statements").
4.04 Undisclosed Liabilities. Purchaser has no liabilities of any
nature except to the extent reflected in the Purchaser Financial Statements.
Purchaser has not conducted any business whatsoever since the date of its
incorporation.
4.05 Interim Changes. Between the date of the Purchaser Financial
Statements, and the date of this Agreement, there have not been, except as set
forth in the Disclosure Schedule (1) any changes in Purchaser's financial
condition, assets, liabilities or business which, in the aggregate, have been
materially adverse; (2) any damage, destruction or loss of or to Purchaser's
property, whether or not covered by insurance; (3) any declaration or payment of
any dividends or other distribution in respect of Purchaser's capital stock, or
any direct or indirect redemption, purchase or other acquisition of any such
stock; or (4) any increase paid or agreed to in the compensation, retirement
benefits or other commitments to employees.
4.06 Title to Property. Purchaser has good and merchantable title to
all properties and assets, real and personal, reflected in Purchaser's latest
Balance Sheet, if any, except as since sold
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or otherwise disposed of in the ordinary course of business, and Purchaser's
properties and assets are subject to no mortgage, pledge, lien or encumbrance,
except for liens shown therein.
4.07 Litigation. There is no litigation or proceeding pending, or to
Purchaser's knowledge threatened, against or relating to Purchaser, its
properties or business, except as set forth in the Disclosure Schedule.
4.08 Investment Intent. Purchaser is acquiring the Company shares to be
transferred to it under this Agreement for investment and not with a view to the
sale or distribution thereof, and Purchaser has no commitment or present
intention to liquidate Company or to sell or otherwise dispose of its stock.
4.09 Corporate Authority. Purchaser has full corporate power and
authority to enter into this Agreement and to carry out its obligations
hereunder and will deliver to the Shareholders at the Closing a certified copy
of resolutions of its Board of Directors authorizing execution of this Agreement
by its officers and part performance thereunder.
4.10 Due Authorization. Execution of this Agreement and performance by
Purchaser hereunder has been duly authorized by all requisite corporate and
shareholder action on the part of Purchaser, and this Agreement constitutes a
valid and binding obligation of Purchaser. Performance hereunder will not
violate any provision of Purchaser's Articles of Incorporation, Bylaws,
agreements, mortgages, agreements with third parties or other commitments.
SECTION 5. INDEMNIFICATION
5.01 Indemnification of Purchaser. The Shareholders severally (and not
jointly) agree to indemnify Purchaser against any loss, damage or expense
(including reasonable attorneys' fees) suffered by Purchaser from (1) any breach
by the Shareholders of this Agreement; or (2) any inaccuracy in or breach of any
of the representations, warranties or covenants by the Shareholders herein;
provided, however that (a) Purchaser shall be entitled to assert rights of
indemnification hereunder only if and to the extent that it suffers losses,
damages and expenses (including reasonable attorneys' fees) exceeding $50,000 in
the aggregate; and (b) Purchaser shall give notice of any claims hereunder
within the twenty-four (24) month period beginning on the date of the Closing.
No loss, damage or expense shall be deemed to have been sustained by Purchaser
to the extent of insurance proceeds paid to, or tax benefits realizable by,
Purchaser or Company as a result of the event giving rise to such right to
indemnification.
5.02 Indemnification of Shareholders. Purchaser agrees to Indemnify the
Shareholders against any loss damage or expense (including reasonable attorneys'
fees) suffered by any of the Shareholders from (1) any breach by Purchaser of
this Agreement; or (2) any inaccuracy in or breach of any of Purchaser's
representations, warranties or covenants herein.
5.03 Defense of Claims. Upon obtaining knowledge thereof, the
indemnified party shall
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promptly notify the indemnifying party of any claim which has given or could
give rise to a right of indemnification under this Agreement If the right of
indemnification relates to a claim asserted by a third party against the
indemnified party, the indemnifying party shall have the right to employ counsel
acceptable to the indemnified party to cooperate in the defense of any such
claim. So long as the indemnifying party is defending any such claim in good
faith, the indemnified party will not settle such claim. If the indemnifying
party does not elect to defend any such claim, the indemnified party shall have
no obligation to do so.
SECTION 6. GENERAL PROVISIONS
6.01 Further Assurances. At any time, and from time to time, after the
Effective Date, each Company will execute such additional instruments and take
such action as may be reasonably requested by the other party to confirm or
perfect title to any property transferred hereunder or otherwise to carry out
the intent and purposes of this Agreement.
6.02 Waiver. Any failure on the party of either party hereto to comply
with any of its obligations, agreements or conditions hereunder may be waived in
writing by the party to who such compliance is owed.
6.03 Brokers. Each party represents to the other party that no broker
or finder has acted for it in connection with this Agreement, and agrees to
indemnify and hold harmless the other party against any fee, loss or expense
arising out of claims by brokers or finders employed or alleged to have been
employed by it.
6.04 Notices. All notices and other communications hereunder shall be
in writing and shall be deemed to have been given if delivered in person or sent
by prepaid first-class registered or certified mail, return receipt requested,
as follows:
To:
Voxcom Holdings, Inc.
14990 Landmark Blvd., Suite 250
Dallas, Texas 75240
Attention: President
To Shareholders:
c/o Lawrence R. Biggs, Jr.
14990 Landmark Blvd.
Suite 250
Dallas, Texas 75240
6.05 Entire Agreement. This Agreement constitutes the entire agreement
between the
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parties and supersedes and cancels any other agreement, representation, or
communication, whether oral or written, between the parties hereto relating to
the transactions contemplated herein or the subject matter hereof.
6.06 Headings. The section and subsection headings in this Agreement
are inserted for convenience only and shall not affect in any way the meaning or
interpretation of this Agreement.
6.07 Governing Law. This Agreement shall be governed by and construed
and enforced in accordance with the laws of the State of Nevada.
6.08 Assignment. This Agreement shall inure to the benefit of, and be
binding upon, the parties hereto and their successors and assigns; provided,
however, that any assignment by either party of its rights under this Agreement
without the written consent of the other party shall be void.
6.09 Counterparts. This Agreement may be executed simultaneously in two
or more counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
6.10 Disclosure Schedule. The Disclosure Schedule shall be attached
hereto prior to execution and shall contain any matter for which information may
be called for by any Section of this Agreement in order to clarify, amend or
render accurate such information.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement the
date first above written.
VOXCOM HOLDINGS, INC.
By:/s/ Daniel Lezak
--------------------------
Name: Daniel Lezak, President
/s/ Lawrence R. Biggs, Jr.
-----------------------------
Lawrence R. Biggs, Jr.
/s/ Donald G. McLellan
-----------------------------
Donald G. McLellan
/s/ Larry Cahill
-----------------------------
Larry Cahill
6
PROMISSORY NOTE
$10,000,000 June 30, 1997
FOR VALUE RECEIVED, the undersigned VOXCOM HOLDINGS, INC., a Nevada
corporation (herein called "Maker"), promises to pay unto the order of Lawrence
R. Biggs, Jr., Larry Cahill, and Donald G. McLellan (herein called "Payee" which
term herein in every instance shall refer to any owner or holder of this Note)
the aggregate sum of TEN MILLION AND NO/100 DOLLARS ($10,000,000.00) together
with interest on the principal balance hereof from time to time outstanding from
the date of advancement until paid, at the annual rate of the prime rate in
effect on December 31 of each year during the term of this note, as such prime
rate shall be quoted in the Wall Street Journal (but in no event to exceed the
maximum lawful rate of interest permitted by applicable usury laws). The
principal and interest hereunder shall be payable in lawful money of the United
States of America at the address of Payee as Payee may designate hereafter in
writing.
This Note shall be payable in 24 consecutive, monthly, equal
installments of principal, plus interest on the unpaid principal balance. The
Maker at its election shall have the right to defer all or part of any 12 such
installments by giving notice thereof to Payee and paying all accrued interest
on the date required for payment, provided that the full amount of all principal
and interest shall be repaid in full on or before 48 months from the date of
this Note.
Maker may prepay this note in whole or in part at any time without
being required to pay any penalty or premium for such privilege. All prepayments
hereunder, whether designated as payments of principal or interest, shall be
applied first to accrued and unpaid interest and then installments of principal
in the inverse order of their stated maturity.
Maker and any and all sureties, guarantors and endorsers of this note
and all other parties now or hereafter liable hereon, severally waive grace,
demand, presentment for payment, protest, notice of any kind (including, but not
limited to, notice of protest, notice of intention to accelerate and notice of
acceleration) and diligence in collecting and bringing suit against any party
hereto, and agree (a) to all extensions and partial payments, with or without
notice, before or after maturity, (b) to any substitution, exchange or release
of any security now or hereafter given for this note, (c) to the release of any
party primarily or secondarily liable hereon, and (d) that it will not be
necessary for Payee, in order to enforce payment of this note, to first
institute or exhaust Payee's remedies against Maker or any other party liable
therefor or against any security for this note.
In the event of default hereunder or under any of the instruments
securing payment hereof and this note is placed in the hands of an attorney for
collection (whether or not suit is filed), or if this note is collected by suit
or legal proceeding or through the probate court or bankruptcy
PROMISSORY NOTE Page 1 of 3
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<PAGE>
proceedings, Maker agrees to pay all reasonable attorneys' fees and all expenses
of collection and costs of court.
It is the intention of the parties hereto to comply with applicable
usury laws (now or hereafter enacted); accordingly, notwithstanding any
provision to the contrary in this note, or in any of the documents securing
payment hereof or otherwise relating hereto, in no event shall this note or such
documents require the payment or permit the collection of interest in excess of
the maximum amount permitted by such laws. If any such excess of interest is
contracted for, charged, taken, reserved or received under this note or under
the terms of any of the documents securing payment hereof or otherwise relating
hereto, or in the event the maturity of the indebtedness evidenced by this note
is accelerated in whole or in part, or in the event that all or part of the
principal or interest of this note shall be prepaid, so that under any of such
circumstances the amount of interest contracted for, charged, taken, reserved or
received under this note or under any of the instruments securing payment hereof
or otherwise relating hereto, on the amount of principal actually outstanding
from time to time under this note shall exceed the maximum amount of interest
permitted by applicable usury laws, now or hereafter enacted, then in any such
event (i) the provisions of this paragraph shall govern and control, (ii) any
such excess which may have been collected at final maturity of said indebtedness
either shall be applied as a credit against the then unpaid principal amount
hereof or refunded to Maker, at Payee's option, and (iii) upon such final
maturity, the effective rate of interest shall be automatically reduced to the
maximum lawful rate allowed under applicable usury laws as now or hereafter
construed by the courts having jurisdiction thereof. Without limiting the
foregoing, all calculations of the rate of interest contracted for, charged,
taken, reserved or received under this note or under such other documents which
are made for the purpose of determining whether such rate exceeds the maximum
lawful rate, shall be made, to the extent permitted by law, by amortizing,
prorating, allocating and spreading in equal parts during the period of the full
stated term of the loan evidenced hereby, all interest at any time contracted
for, charged, taken, reserved or received from Maker or otherwise by Payee in
connection with such indebtedness.
THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED UNDER THE APPLICABLE LAWS
OF THE STATE OF TEXAS. THE COUNTY OF DALLAS, TEXAS SHALL BE THE PROPER PLACE OF
VENUE TO ENFORCE PAYMENT OF THIS NOTE. MAKER IRREVOCABLY AGREES THAT THE STATE
DISTRICT COURTS IN DALLAS COUNTY, TEXAS SHALL BE THE EXCLUSIVE COURTS FOR ANY
LEGAL PROCEED INGS ARISING OUT OF OR IN CONNECTION WITH THIS NOTE.
To the extent that the interest rate laws of the State of Texas are
applicable to this note and unless changed in accordance with law, the
applicable interest rate ceiling is the indicated (weekly) ceiling determined in
accordance with Article 5069-1.04(a)(1) of the Texas Revised Civil Statutes, as
amended, or to any successor to such statute.
Any check, draft, money order or other instrument given in payment of
all or any portion thereof may be accepted by Payee and handled in collection in
the customary manner, but the same shall not constitute payment hereunder or
diminish any rights of Payee except to the extent that actual cash proceeds of
such instrument are unconditionally received by Payee.
PROMISSORY NOTE Page 2 of 3
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<PAGE>
Maker represents and warrants to Payee and to all other owners and
holders of any indebtedness evidenced hereby that all loans evidenced by this
note are for business, commercial, investment or other similar purpose and not
primarily for personal, family, household or agricultural use, as such terms are
used or defined in Texas Revised Civil Statutes, Article 5069- 1.04, Texas
Credit Code and Regulation Z promulgated by the Board of Governors of the
Federal Reserve System and under Titles I and V of the Consumer Credit
Protection Act.
This note is issued pursuant to and is secured by that certain Security
Agreement-Pledge of even date herewith (the "Security Agreement") by and among
Maker and Payee. Reference is made to the Security Agreement for certain
provisions relating to the acceleration of maturity hereof upon the occurrence
of certain events specified therein and for all other pertinent purposes.
VOXCOM HOLDINGS, INC.
By:/s/ Daniel Lezak
----------------------
Daniel Lezak, President
PROMISSORY NOTE Page 3 of 3
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SECURITY AGREEMENT-PLEDGE
(SECURITIES)
This Security Agreement-Pledge is entered into as of the 30th day of
June, 1997, by VOXCOM HOLDINGS, INC. ("Debtor"), in favor of LAWRENCE R. BIGGS,
JR., LARRY CAHILL, AND DONALD G. MCLELLAN ("Secured Party").
SECTION 1. SECURITY INTEREST. For value received, the receipt and
sufficiency of which is hereby acknowledged including, without limitation, the
agreement by Secured Party to extend certain credit and financial accommodations
to Debtor, pursuant to a Promissory Note dated the date hereof between Debtor
and Secured Party ("the Note"), Debtor has granted and does hereby grant to
Secured Party a security interest in and agrees and acknowledges that Secured
Party has and shall continue to have a security interest in the following
described property (herein called the "Collateral"), to-wit:
100% of the outstanding capital stock of AmeraPress, Inc., a
Nevada corporation now owned or hereafter acquired by Debtor,
presently being 10,000 shares represented by Certificate No.
004 standing in the name of Debtor in the books of Debtor;
together with all moneys, income, proceeds and benefits attributable or accruing
to such property including, but not limited to, all stock rights, rights to
subscribe, liquidating dividends, stock dividends, dividends paid in stock, new
security or other properties or benefits to which Debtor is or may hereafter
become entitled to receive on account of such property, and in the event that
Debtor shall receive any of such, Debtor shall hold the same as trustee for
Secured Party and will immediately deliver the same to Secured Party to be held
hereunder in the same manner as the property specifically described above is
held hereunder. All of the property in which Secured Party is hereby granted a
security interest shall herein sometimes be called the "Collateral" or the
"Pledged Securities". Debtor has delivered possession of the Collateral to
Secured Party and agrees to execute such stock powers, endorse such instruments,
execute such additional pledge agreements or other documents as may be required
by Secured Party in order to effectively grant to Secured Party the security
interest in the Collateral.
SECTION 2. OBLIGATIONS. The security interest granted hereby is to
secure the payment and performance of the Note and any and all other
indebtedness, obligations, and liabilities incurred by the Debtor to the Secured
Party (collectively called the "Obligations"). Debtor and Debtor acknowledge
that the security interest hereby granted shall secure all future advances as
well as any and all other obligations and liabilities of the Debtor to Secured
Party whether now in existence or hereafter arising.
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SECTION 3. WARRANTIES AND COVENANTS OF DEBTOR. Debtor hereby warrants,
covenants and agrees that:
A. Except for the security interest granted hereby, Debtor is the
owners of the Collateral free of any adverse claim, lien, mortgage, pledge,
security interest or other encum brance, or right or option on the part of any
third party to purchase or otherwise acquire the Collateral or any part thereof;
and Debtor will defend the Collateral against all claims and demands of all
parties at any time claiming the same or an interest therein;
B. Debtor will not sell or offer to sell or otherwise transfer or
encumber the Collateral or any interest therein without the prior written
consent of Secured Party;
C. Debtor will keep the Collateral free from any and all adverse liens,
mortgages, pledges, claims, security interests and other encumbrances;
D. Debtor will pay to Secured Party all expenses and expenditures,
including reasonable attorney's fees and legal expenses, incurred or paid by
Secured Party in exercising or protecting its interest, rights and remedies
under this Security Agreement. Debtor agrees to pay interest on such amounts at
the rate of ten percent (10%) per annum from the date such are incurred by
Secured Party until the date paid by Debtor or Debtor;
E. The security interest granted hereby shall in no way be affected by
any indulgence or indulgences, extension or extensions, change or changes in the
form, evidence, maturity, rate of interest or otherwise of any of the
Obligations, nor by want of presentment, notice, protest, suit or indulgence
upon any of the Obligations, nor shall any release of, or failure to perfect the
security interest or lien in, any security for or, of any of the parties liable
for, the payment of the Obligations in any manner affect or impair this pledge,
and the same shall continue in full force and effect in accordance with the
terms hereof until the Obligations have been fully paid;
F. Any and all instruments, securities and other properties heretofore,
now or hereafter delivered to Secured Party or in Secured Party's possession, or
to any bailee or agent of Secured Party, shall also secure the Obligations and
shall be held and construed to be a part of the Collateral hereunder to the same
extent as if fully described herein; and
G. Secured Party shall have the power to endorse and is hereby
appointed Debtor's agent for the purpose of endorsing in the name of Debtor any
instrument or document constituting Collateral or which may be received in
payment or as proceeds of the Collateral.
SECTION 4. EVENTS OF DEFAULT. The occurrence of any of the following
events or conditions shall constitute an "Event of Default":
A. Default in the payment of the Obligations when due;
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B. The levy of any attachment, execution, garnishment or other process
against all or any part of the Collateral in connection with any lien, debt,
judgment, assessment or obligation of Debtor, or the levy of any such process
against any other property of Debtor which would tend to have a material adverse
effect upon Debtor's ability to perform its obligations to Secured Party; or
C. Any representation or warranty made by Debtor in this Pledge
Agreement or in any other agreement, certificate, financial or other statement
furnished by Debtor pursuant hereto or in connection herewith is untrue in any
material respect as of the date made or furnished.
SECTION 5. REMEDIES OF SECURED PARTY. Upon the happening of any Event
of Default specified herein, and at any time thereafter, at the option of the
holder thereof, all or any part of the Obligations shall become immediately due
and payable without presentment, demand, notice of intention to accelerate,
notice of acceleration, notice of non-payment, protest, notice of dishonor, or
any other notice whatsoever to Debtor, or any person obligated thereon, and
Secured Party shall have and may exercise with reference to the Collateral and
Obligations any and all of the rights and remedies of a secured party under the
Uniform Commercial Code as then in effect in the State of Texas, and as
otherwise granted herein or under any other applicable law or under any other
agreements executed by Debtor (all of which rights and remedies shall be
cumulative), including, without limitation, the right to sell the Collateral, or
any part thereof, at public or private sale or at any broker's board or on any
securities exchange, for cash or on credit, or for future delivery without
assumption of any credit risk, and at such price or prices as Secured Party may
deem satisfactory. Any holder of the Obligations may be the purchaser of all or
any part of the Collateral so sold at any public sale (or if the Collateral is
of a type customarily sold in a recognized market or is of a type which is the
subject of widely distributed standard price quota tions, at any private sale)
and thereafter hold the same absolutely, free from any right or claim or right
of whatever kind. Secured Party is hereby authorized at any such sale, if it
deems it advisable so to do, to restrict the prospective bidders or purchasers
of any of the Pledged Securities to persons who will represent and agree that
they are purchasing for their own account for investment, and not with a view to
the distribution or sale of any of the Pledge of Securities. Upon any such sale,
Secured Party shall have the right to deliver, assign and transfer to the
purchaser thereof the Collateral so sold. Each purchaser at any such sale shall
hold the Collateral so sold absolutely, free from any claim or right of whatever
kind. Secured Party shall give Debtor ten days' written notice of its intention
to make any such public or private sale or sale at broker's board or on a
securities exchange. Such notice, in the case of a public sale, shall state the
time and place fixed for such sale, and, in the case of sale at a broker's board
or on a securities exchange, shall state the board or exchange at which such
sale is to be made and the day on which the Collateral, or the portion thereof
so being sold, will first be offered for sale at such board or exchange. Any
such public sale shall be held at such time or times within ordinary business
hours and at such place or places as Secured Party may fix in the notice of such
sale. At any such sale, the Collateral may be sold in one lot as an entirety or
in separate parcels as Secured Party may determine. Secured Party shall not be
obligated to make any such sale pur suant to any such notice. Secured Party may,
without notice or publication, adjourn any public or private sale or cause the
same to be adjourned from time to time by announcement at the time
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and place fixed for the sale, and such sale may be made at any time or place to
which the same may be so adjourned. In case of any sale of all or any part of
the Collateral on credit or for future delivery, the Collateral so sold may be
retained by Secured Party until the purchase price is paid by the purchaser
thereof, but Secured Party shall not incur any liability due to any failure of
such purchaser to take up and pay for the Collateral so sold and, upon such
failure, such Collateral may again be sold upon like notice. Instead of
exercising the power of sale herein conferred upon it, Secured Party may proceed
by a suit or suits at law or in equity to foreclose the security interests
herein granted and sell the Collateral, or any part thereof, under a judgment or
decree of a court or courts of competent jurisdiction.
Secured Party is hereby granted the right, after the occurrence of an
Event of Default, to transfer at any time to itself or its nominee the Pledged
Securities, or any part thereof, and thereafter to exercise all voting rights
with respect to any such Pledged Securities so transferred and to receive the
proceeds, payments, moneys, income or benefits attributable or accruing thereto
and to hold the same as security for the Obligations, or at Secured Party's
election, to apply such amounts to the Obligations, whether or not then due, in
such order as Secured Party may elect, or, Secured Party may, at its option,
without transferring such Pledged Securities to its nominee, exercise all voting
rights with respect to the Pledged Securities and vote all or any part of the
Pledged Securities at any regular or special meeting of shareholders, and Debtor
does hereby name, constitute and appoint as the proxy of Debtor the Secured
Party, in the Debtor's name, place and stead to vote any and all such Pledged
Securities, as such proxy may elect, for and in the name, place and stead of
Debtor, such proxy to be irrevocable and deemed coupled with an interest.
SECTION 6. MISCELLANEOUS.
A. Secured Party shall not be obligated to take any steps necessary to
preserve any rights in the Collateral against prior parties, which Debtor hereby
is assumed to do.
B. No delay or omission on the part of Secured Party in exercising any
rights hereunder shall operate as a waiver of any such right or any other right.
A waiver on any one or more occasions shall not be construed as a bar to or
waiver of any right or remedy on any future occasion.
C. It is the intention of the parties hereto to comply with applicable
usury laws; accordingly, it is agreed that notwithstanding any provision to the
contrary in this Security Agreement, or in any of the instruments or documents
evidencing the Obligations or otherwise relating thereto, no such provision
shall require the payment or permit the collection of interest in excess of the
maximum permitted by such laws. If any excess of interest in such respect is
provided for, or shall be adjudicated to be so provided for, in this Security
Agreement, or in any of the instruments or documents evidencing the Obligations
or otherwise relating thereto, then in such event (1) the provisions of this
paragraph shall govern and control, (2) neither Debtor nor its successors or
assigns or any other party liable for the payment of the Obligations, shall be
obli gated to pay the amount of such interest to the extent that it is in excess
of the maximum amount
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permitted by such laws, (3) any such excess which may have been collected shall
be, at the option of the holder or holders of the Obligations, either applied as
a credit against the then unpaid principal amount thereof or refunded, as
applicable, to Debtor and (4) the effective rate of interest shall be
automatically subject to reduction to the maximum lawful rate allowed to be
lawfully con tracted for under applicable usury laws as now or hereafter
construed by the courts having jurisdiction.
D. All rights of Secured Party hereunder shall inure to the benefit of
its successors and assigns, and all obligations of Debtor shall bind their
successors or assigns. The rights and remedies of Secured Party hereunder are
cumulative, and the exercise of any one or more of the remedies provided herein
shall not be construed as a waiver of any of the other remedies of Secured
Party.
E. The security interest hereby granted and all the terms and
provisions hereof shall continue in full force and effect, and all the terms and
provisions hereof shall remain effective as between the parties, until the
repayment by Debtor or Debtor of all Obligations.
F. This Security Agreement and the security interest herein granted are
in addition to, and not in substitution, novation or discharge of, any and all
prior or contemporaneous security agreements and security interests in favor of
Secured Party or assigned to Secured Party by Debtor. All rights, powers and
remedies of Secured Party in all such security agreements are cumulative, but in
the event of actual conflict in terms and conditions, the terms and conditions
of the latest security agreement shall govern and control.
G. Any provision of this Security Agreement found to be invalid under
the laws of the State of Texas, or any other state having jurisdiction or other
applicable law, shall be invalid only with respect to the offending provision.
All words used herein shall be construed of such gender or number as the
circumstances require. The laws of the State of Texas and, as applicable, the
laws of the United States of America, shall govern this Security Agreement, its
construction, interpretation and enforcement.
H. This Security Agreement may be executed in any number of
counterparts, all of which together shall constitute one and the same
instrument.
IN WITNESS WHEREOF, the parties hereto have caused this agreement to be
executed as of the date first above written.
DEBTOR:
Voxcom Holdings, Inc.
By:/s/ Daniel Lezak
-----------------------
DANIEL LEZAK, PRESIDENT
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SECURED PARTY:
/s/ Lawrence R. Biggs, Jr.
--------------------------
Lawrence R. Biggs, Jr.
/s/ Larry Cahill
--------------------------
Larry Cahill
/s/ Donald G. McLellan
--------------------------
Donald G. McLellan
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STOCK PURCHASE AGREEMENT
THIS STOCK PURCHASE AGREEMENT, made and entered into as of April 1,
1998, by and between VOXCOM HOLDINGS, INC., a Nevada corporation (hereinafter
referred to as the "Buyer") and GARY RAABE (hereinafter referred to as the
"Seller").
W I T N E S S E T H:
WHEREAS, the Seller owns all of the outstanding shares of Common Stock,
no par value (hereinafter referred to as the "Shares") of MAXpc TECHNOLOGIES,
INC., a Texas corporation (hereinafter referred to as the "Company"); and
WHEREAS, the Seller desires to sell the Shares to Buyer and Buyer
desires to purchase the Shares on the terms and subject to the conditions set
forth herein;
NOW THEREFORE, in consideration of the premises and the mutual
covenants set forth below and other good and valuable consideration, the receipt
and adequacy of which are hereby acknowledged, and intending to be legally
bound, the parties hereto do hereby agree as follows:
I.
PURCHASE AND SALE OF SHARES
SECTION 1.01 Purchase and Sale of Shares. Subject to the terms and
conditions set forth herein, effective the date on which all transactions
described herein are completed and closed (the "Closing Date") Seller shall sell
to the Buyer, and the Buyer shall purchase from Seller the Shares. Seller shall
transfer all of his right, title, and interest in and to the Shares being
conveyed by him to Buyer free and clear of any lien, security interest, or other
encumbrance of any nature and free of any claim by any person or entity to or
against the Shares.
SECTION 1.02 Purchase Price. (a) The purchase price of the Shares
(hereinafter referred to as the "Purchase Price") shall be 200,000 shares of
unregistered Common Stock of Buyer.
II.
REPRESENTATIONS AND WARRANTIES OF THE SELLERS
PART A. The Seller hereby represents and warrants to, and agrees with, the
Buyer as follows:
SECTION 2.01 Organization, Qualifications, etc.
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(a) The Company is a corporation, duly organized, validly
existing and in good standing under the laws of the State of Texas and
is duly licensed or qualified as a foreign corporation in each
jurisdiction, if any, in which the nature of the business transacted by
it or the character of the properties owned or leased by it makes such
licensing or qualification necessary, except where the failure to
obtain such licensing or qualification would not have a material
adverse effect on the Company. The Company has the full corporate power
and authority to own and hold its properties and to conduct its
business as currently conducted.
(b) The copies of the Company's articles of incorporation and
bylaws which have been delivered to Buyer are complete and correct,
contain all amendments thereto, and are in full force and effect as of
the date hereof.
(c) The Company has no subsidiaries and does not own of record
or beneficially, directly or indirectly, (i) any shares of outstanding
capital stock or securities convertible into capital stock of any other
corporation, or (ii) any participation or interest in any partnership,
limited liability company, joint venture, or other non-corporate
business enterprise.
(d) The Company has such permits, licenses, franchises and
authorizations ("Permits") from governmental and regulatory authorities
as are necessary to conduct its business and sell its products and
services, except for such Permits the absence of which would not have a
material adverse effect on the Company. The Company holds such Permits
free of any claims and has fulfilled and performed all of its material
obligations with respect to such Permits and no event has occurred
which allows, nor after notice or lapse of time or both would allow,
revocation or termination thereof or would result in any other material
impairment of the rights of the Company under any such Permits.
SECTION 2.02 Capital Stock. The authorized capital stock of the Company
consists solely of 19,000,000 shares of Common Stock, of which 1,000 shares are
validly issued and outstanding, fully paid and nonassessable. No subscription,
warrant, option, convertible security, or other right (contingent or other) to
purchase or acquire any shares of any class of capital stock of the Company from
the Company is authorized or outstanding. There is not any commitment of the
Company to issue any shares, warrants, options, or other such rights or to
distribute to holders of its capital stock any evidence of indebtedness or
assets. The Company has no obligation (contingent or other) to purchase, redeem
or otherwise acquire any shares of its capital stock or any interest therein or
to pay any dividend or make any other distribution in respect thereof.
SECTION 2.03 Non-Contravention. Except as set forth in Schedule 2.03
hereto, the execution and delivery of this Agreement do not, and the
consummation of the purchase and sale of the Shares and the other transactions
contemplated hereby will not (i) violate any provision of the articles of
incorporation or bylaws of the Company; (ii) violate any provision of, result in
a default under, allow or result in termination of, or require the consent of
another party to, any loan
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agreement, lease, license, note, instrument, security agreement, mortgage, lien,
deed of trust, development agreement, maintenance agreement, supply agreement,
sales contract, or other written or oral contract or agreement of any kind;
(iii) entitle any party to accelerate any monetary or other obligation of the
Company, (iv) result in the creation or imposition of any lien, charge,
mortgage, security interest, or other encumbrance upon the Shares or any
property of the Company, (v) violate any judgment, award, injunction, order, or
decree or (vi) violate or conflict with any other material restriction of any
kind to which the Company, any of its property, or the Shares are subject.
SECTION 2.04 Contribution. Immediately prior to the Closing, Seller
shall contribute to the Company all of the assets listed on attached Schedule
2.04. There are and will be at closing no liabilities of any kind owed by the
Company, whether direct or contingent.
SECTION 2.05 Events Subsequent To March 9, 1998. Except as set forth in
Schedule 2.05, since March 9, 1998, when the Company was incorporated, the
Company has not (i) issued or agreed to issue any stock, bonds, notes, options,
warrants, rights, or other corporate securities, (ii) borrowed any amount or
incurred any material liabilities (absolute, accrued, contingent or other),
(iii) discharged or satisfied any lien or incurred or paid any obligation or
liability (absolute or contingent) except liabilities and obligations paid to
unrelated parties in the ordinary course of business, (iv) declared or made any
payment or distribution to shareholders or purchased or redeemed any shares of
its capital stock or other securities, (v) mortgaged, pledged, or subjected to
lien or security interest any of its assets, tangible or intangible, other than
liens of current taxes not yet due, (vi) sold, assigned, or transferred any of
its tangible assets (except inventory sold in the ordinary course of business)
or canceled any debts or claims, (vii) sold, assigned, or transferred any
patents, trademarks, trade names, copyrights, trade secrets, proprietary
information, or other intangible assets, (viii) suffered any material casualty
losses, or waived any rights of substantial value, (ix) made any changes in
employee or officer or director compensation, (x) entered into any transaction
except in the ordinary course of business or as contemplated by this Agreement,
or (xi) agreed or committed to do any of the foregoing.
SECTION 2.06 Actions Pending. Except as set forth in Schedule 2.06
hereto, there is no action, suit, or proceeding filed, threatened against, or
affecting the Company or any of its properties or rights before any court or by
or before any tribunal or arbitration board or governmental body. No
governmental entity is investigating or threatening to investigate the Company.
There does not exist any material unasserted claim which may give rise to any
action, suit, or proceeding against the Company.
SECTION 2.07 Trade Secrets. No third party has claimed that any person
affiliated with the Company has, in respect of his activities on behalf of the
Company to date, violated any of the terms or conditions of an employment
contract or other agreement with such third party, disclosed or utilized any
trade secrets or proprietary information or documentation of such third party,
or interfered in the employment relationship between such third party and any of
its employees, nor, has any such violation, disclosure or utilization occurred.
The Company has not wrongfully utilized any trade secrets or any information or
documentation proprietary to any other person or entity, including, but not
limited to computer software source code or confidential business information,
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and neither the Company nor any person or entity affiliated with the Company has
violated any confidential relationship with any third party in connection with
the development and sale or license of any products or services of the Company.
SECTION 2.08 Properties.
(a) The Company has good and valid title to all properties and
assets owned by it, including, without limitation, those listed on
Schedule 2.04.
(b) The Company owns or has the right to use as a licensee or
otherwise all intangible personal property, including without
limitation all trade secrets, know how and other intellectual and
proprietary rights and franchises, that are necessary to the sale
and/or licensing of its Products and the conduct of the business of the
Company as presently conducted, and such ownership and use rights are
free and clear of adverse claims, liens, mortgages, charges, security
interests, and other encumbrances except as set forth in Schedule 2.08.
(c) The Company has not infringed any patent, copyright, or
trade secret rights of any third party.
(d) Except as set forth on Schedule 2.08, the Company does not
practice any patented method in connection with the manufacture of the
Products or the software products planned or under development by the
Company.
SECTION 2.09 Leasehold Interests. Each lease or agreement to which the
Company is a party under which it is a lessee of any property, real or personal,
owned by any third party is a valid and subsisting agreement, without any
material default of the Company thereunder and without any material default
thereunder of the other party thereto. The Company's possession of such
respective property has not been disturbed, nor has any claim been asserted
against the Company adverse to its rights in such leasehold interests.
SECTION 2.10 Employment Contracts, Etc. Except as set forth in Schedule
2.10 hereto, (i) the Company is not a party to any employment or deferred
compensation agreements, (ii) the Company does not have any bonus, incentive,
profit-sharing plans, or stock option plans, (iii) the Company does not have any
pension, retirement or similar plans or obligations, whether of a legally
binding nature or in the nature of informal understandings, or (iv) there are no
existing material arrangements or proposed material transactions between the
Company and any officer or director or shareholder of the Company.
SECTION 2.11 Other Contracts and Commitments. Except as set forth in
Schedule 2.11 hereto, the Company is not a party to any contract or commitment
(or group of related contracts or commitments), other than contracts of the type
referred to in Section 2.10 and contracts entered into in the ordinary course of
business that do not involve more than $5,000 or have a term (including renewals
or extensions optional with another party) of more than one year from the date
hereof. The
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Company is not in default in the performance, observance or fulfillment of any
of the obligations, covenants or conditions contained in any agreement or
instrument to which it is a party which may result in any material adverse
change in the condition, financial or other, of the Company.
SECTION 2.12 Compliance With Law. The Company is not in default under
any order of any court, governmental authority, arbitration board or tribunal to
which it is or was subject or in violation of any laws, ordinances, governmental
rules, or regulations, including, but not limited to, any wage/hour, labor, or
anti-discrimination laws relating to its employees.
SECTION 2.13 Employee and Fringe Benefit Plans. The Company does not
maintain and is not required to contribute to or otherwise participate in (and
has not during the preceding five years maintained, contributed to or otherwise
participated in) an "employee benefit plan" or a "multi-employer plan", (as such
terms are defined in the Employee Retirement Income Security Act of 1974, as
amended ("ERISA").
SECTION 2.14 Insider Interests. Except as disclosed on Schedule 2.14,
no officer, or director, or shareholder of the Company has any agreement with
the Company or any interest in any property, real or personal, tangible or
intangible, including without limitation patents, copyrights, trade secrets,
know how, technology, trade names, or trademarks used in the business of the
Company. All agreements listed on Schedule 2.14 provide for prices and terms
which are no more burdensome to the Company than would have been contained in
agreements negotiated by unrelated parties dealing at arm's length.
SECTION 2.15 Brokers. Seller has not made any agreement or arrangement
which would result in any broker, finder, agent or other person or entity having
any claim for any fee, commission, or payment against Buyer or the Company in
connection with the negotiation or execution of this Agreement or the
consummation of the transactions contemplated hereby.
SECTION 2.16 Environmental Matters. To the best knowledge of Seller,
the location, construction, occupancy, operation, condition and use of any real
or personal property owned, leased by or in the possession of the Company (the
"Property"), the facilities or improvements located thereon, and the operations
and practices of the Company are in substantial compliance with all
environmental laws and regulations, and any restrictive covenant or deed
restriction (recorded or otherwise) affecting the Property, including, without
limitation all applicable zoning ordinances and building codes in effect at the
time of improvement of such Property. The Company is not subject to any material
liability or obligation, including investigatory or remedial obligations under
any environmental law or the common law with respect to hazardous materials,
relating to (i) the environmental conditions on, under or about the Property,
including, without limitation, the air, soil, surface water and groundwater
conditions at the Property, or (ii) the use, management, handling, transport,
treatment, generation, storage, disposal, release or discharge of any hazardous
materials. The Company has not received any notice nor is it aware of any
existing condition or the practice of the business conducted by the Company
which forms or could form the basis of any claim, action, suit, proceeding,
administrative consent or agreement, litigation or settlement, hearing or
investigation, arising out of the manufacture, processing, distribution, use,
treatment, storage, spill,
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disposal, transport, or handling, or the emission, discharge, release or
threatened release into the environment of any hazardous material which, if
decided against the Company, would have a material adverse effect on the
Company, taken as a whole. To the best of its knowledge, the Company has
obtained or applied for all permits, licenses, registrations, notifications and
similar authorizations required under environmental laws for the conduct of its
business or relating to the Property, the facilities, improvements, or equipment
located thereon.
SECTION 2.17 Ownership of Shares. Seller is the sole record and
beneficial owner of all of the Shares and has good and valid title to such
Shares free and clear of any lien, security interest, or other encumbrance of
any nature and free of any claim by any person or entity to or against such
Shares. Such Shares are not subject to any option, right, proxy, voting
agreement, voting trust, or any other agreement, understanding, or arrangement
affecting the Shares.
SECTION 2.18 Authorization, etc. Seller has the power, authority, and
capacity to enter into this Agreement and to carry out the transactions
contemplated hereby, and this Agreement has been duly executed and delivered by
Seller.
SECTION 2.19 No Consent Required. No consent, approval, order or
authorization of, or registration, declaration or filing with any governmental
or public body or authority or other party on the part of Seller is required for
such Seller to execute and deliver this Agreement and perform his obligations
hereunder.
SECTION 2.20 Litigation Relating to the Agreement. Seller is not a
party to, or object to any judgment, decree, order, lawsuit, or proceeding which
prevents or seeks to prevent the execution of this Agreement or the consummation
of the transactions contemplated hereby.
SECTION 2.21 Other Claims. Seller does not have (i) any claim or cause
of action whatsoever, including any claim under any securities law with respect
to his acquisition of Shares, against the Company, or (ii) any grounds for any
such claim or cause of action, whether now existing, accruing after the giving
of notice or passage of time, or otherwise.
SECTION 2.22 Investment Representations
(a) The shares to be acquired by Seller constituting the
Purchase Price will be acquired by Seller for investment for Seller's
own account, not as a nominee or agent for any person, and not with a
view to the sale or distribution of all or any part thereof except in a
transaction which is the subject of an effective registration statement
under the Securities Act of 1933 ("Securities Act") and any applicable
state securities laws or which is exempt from such registration
requirements, and the Seller has no present intention of selling,
granting participation in, or otherwise distributing such shares.
Seller does not have any contract, undertaking, agreement or
arrangement with any person or entity to sell, transfer, or grant
participation to such person or entity, with respect to any of such
shares.
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(b) The Seller understands that such shares have not been
registered under the Securities Act 1933 in reliance upon applicable
exemptions from the registration requirements of the Securities Act of
1933 and is similarly exempt under state securities laws, and that the
Buyers, reliance on such exemptions is predicated on the Seller's
representations set forth herein.
III.
REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer hereby represents and warrants to, and agrees with, the Sellers
as follows:
SECTION 3.01 Investment Representations
(a) The Shares to be acquired by Buyer will be acquired by
Buyer for investment for Buyer's own account, not as a nominee or agent
for any person, and not with a view to the sale or distribution of all
or any part thereof except in a transaction which is the subject of an
effective registration statement under the Securities Act of 1933
("Securities Act") and any applicable state securities laws or which is
exempt from such registration requirements, and the Buyer has no
present intention of selling, granting participation in, or otherwise
distributing the Shares. Buyer does not have any contract, undertaking,
agreement or arrangement with any person or entity to sell, transfer,
or grant participation to such person or entity, with respect to any of
the Shares.
(b) The Buyer understands that the Shares have not been
registered under the Securities Act 1933 in reliance upon applicable
exemptions from the registration requirements of the Securities Act of
1933 and is similarly exempt under state securities laws, and that the
Sellers, reliance on such exemptions is predicated on the Buyer's
representations set forth herein.
SECTION 3.02 Brokers. Buyer has not made any agreement or arrangement
which would result in any broker, finder, agent or other person or entity having
any claim for any fee, commission, or payment against any Seller in connection
with the negotiation or execution of this Agreement or the consummation of the
transactions contemplated hereby.
SECTION 3.03 Authorization, etc. Buyer has the power, authority, and
capacity to enter into this Agreement and to carry out the transactions
contemplated hereby, and this Agreement has been duly executed and delivered by
Buyer.
SECTION 3.04 No Consent Recruited. No consent, approval, order or
authorization of, or registration, declaration or filing with any governmental
or public body or authority is required for Buyer to execute and deliver this
Agreement and perform its obligations hereunder.
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SECTION 3.05 Litigation Relating to this Agreement. Buyer is not a
party to, or subject to, any judgment, decree, order, lawsuit, or proceeding
which prevents or seeks to prevent the execution of this Agreement or the
consummation of the transactions contemplated hereby.
IV.
INDEMNIFICATION
SECTION 4.01 Buyer's Claims. The Seller shall indemnify and hold
harmless Buyer, its successors and assigns, and their respective officers,
directors, employees, shareholders, agents, and affiliates against any and all
damages, claims, losses, liabilities, and expenses actually incurred by Buyer,
including, without limitation, legal, accounting, and other expenses, which may
arise out of any breach of any of the representations or warranties made in this
Agreement by the Sellers (hereinafter referred to as a "Claim" or "Claims").
Buyer and the Company will indemnify Seller pursuant to the provisions of their
Bylaws and applicable law. Such indemnification obligation shall survive the
Closing.
SECTION 4.02 Sellers' Claim. Buyer shall indemnify and hold harmless
each Seller and his assigns, agents, and affiliates against any and all damages,
claims, losses, liabilities and expenses, including without limitation, legal
accounting, and other expenses actually incurred by Sellers, which may arise out
of any breach of any of the representations or warranties made in this Agreement
by Buyer. Such obligation of Buyer shall survive the Closing.
SECTION 4.03 Rights of Offset. In addition to any other rights or
remedies Buyer may have, it shall be entitled to withhold from any future
payment due to Seller the amount of any and all liabilities, losses, damages,
injuries, costs, expenses and counsel fees which have been asserted, and to
offset from such withheld amount any amount ultimately determined to be due and
owing to Buyer by way of indemnification pursuant to this Section. Any
examination, inspection by audit of the properties, financial condition or other
matters of the Sellers and the Company which is conducted pursuant to this
Agreement shall in no way limit, affect or impair the ability of Buyer to rely
on the representations, warranties, covenants and obligations of the Sellers set
forth herein.
V.
OTHER AGREEMENTS
SECTION 5.01 Waiver of Certain Shareholder Rights. Seller hereby waives
all rights of first refusal, put options, call options, or similar rights
pursuant to any corporate article, by-law, document, contract, agreement or
arrangement of or relating to the Company or the Shares.
SECTION 5.02 Employment. Seller shall remain as an employee of the
Company and shall perform the duties and responsibilities prescribed by the
Board of Directors of the Company. Such employment shall be pursuant to the
Employment Agreement attached hereto as Exhibit A.
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SECTION 5.03 Funding. Buyer agrees that it will provide sufficient
funding to the Company after the Closing to enable the Company to purchase the
first 1,000 multimedia computer boards and meet its immediate working capital
needs; however, such commitment shall not exceed the sum of $300,000.
SECTION 5.04 Operations. From the date hereof until the Closing, Seller
and the Company shall take no action involving the Company without the knowledge
and consent of Buyer.
SECTION 5.05 Release. At the closing, Seller shall execute a release of
any claims against the Company.
VI.
TERMINATION
SECTION 6.01 Buyer's Termination. Buyer shall have the right to
terminate this Agreement prior to Closing for any of the following reasons:
(a) Buyer is not satisfied for any reason with the results of
its examination of the business projections or prospects of the
Company;
(b) Closing shall not have occurred by April 19, 1998, through
no fault of the Buyer;
(c) Any representation of Seller or the Company hereunder
shall be untrue as of the date of Closing.
SECTION 6.02 Seller's Termination. Seller shall have the right to
terminate this Agreement prior to Closing for any of the following reasons:
(a) Closing shall not have occurred by April 19, 1998, through
no fault of the Seller;
(b) Any representation of Buyer or the Company hereunder shall
be untrue as of the date of Closing.
VI.
MISCELLANEOUS
SECTION 7.01 Expenses. Each party hereto will pay its own expenses in
connection with the transactions contemplated hereby, whether or not such
transactions shall be consummated, and the Seller shall not charge any such
expenses to the Company.
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SECTION 7.02 Access and Reliance to Buyer. Buyer and its agents,
counsel, auditors, and other representatives shall be given access to all
property, assets, books and records, and contracts of the Company to enable a
complete investigation for the purpose of verifying the accuracy of the
representations and warranties set forth herein and otherwise investigating the
status of the business and the condition of the Company and its respective
assets and liabilities; provided, however, that no such investigation or the
failure to make any investigation shall in any way limit or affect the
obligations or liabilities of the Seller hereunder, and Buyer shall be deemed to
have relied upon the representations, warranties, and covenants of the other
parties contained herein. Buyer agrees that it will maintain all information so
gathered as confidential, will not reveal any of such information to any third
party or to any of its employees or agents who do not need to know of such
information in the performance of their duties, without the express written
consent of the other parties hereto, and will return all such information if
this Agreement is terminated. If Buyer discovers any materially adverse
information not previously known to Buyer, Buyer may terminate this Agreement by
providing written notice of termination to the other parties hereto within ten
business days of the date hereof.
SECTION 7.03 Survival of Agreements. All covenants, agreements,
representations and warranties made herein shall survive the execution and
delivery of this Agreement and the sale and delivery of the Shares pursuant
hereto.
SECTION 7.04 Certain Rules of Interpretation. Any information disclosed
in any schedule attached hereto or any certificate furnished in connection
herewith shall be deemed disclosed wherever otherwise required, and for all
purposes, under this Agreement, whether or not specific reference was made
thereto. Inclusion of any information in a schedule or exhibit shall not be
deemed an admission as to the materiality of such information or otherwise alter
or affect the provisions of the representation or warranty to which the schedule
or exhibit relates.
SECTION 7.05 Parties in Interest. All covenants and agreements
contained in this Agreement by or on behalf of any of the parties hereto shall
bind and inure to the benefit of the respective successors and assigns of the
parties hereto whether so expressed or not.
SECTION 7.06 Notices. All notices, requests, consents, or other
communications hereunder shall be in writing and shall be delivered personally
or by courier or mailed by first class registered or certified mail, postage
prepaid, in either case addressed as follows:
(a) if to the Seller
c/o Gary Raabe
1918 Maxwell
Lewisville, Texas 75067
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(b) if to the Buyer
Voxcom Holdings, Inc.
8115 Preston Road
Suite 800 - East
Dallas, Texas 75225
Attention: Don McLellan
or, in any such case, at such other address or addresses as shall have been
furnished in writing by such party to the others. Any such communication shall
be deemed given when actually delivered to the address indicated.
SECTION 7.07 LAW GOVERNING. THIS AGREEMENT SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF
TEXAS.
SECTION 7.08 Entire Agreement. This Agreement, along with the Schedules
and Exhibits attached hereto, constitutes the entire agreement of the parties
with respect to the subject matter hereof and may not be modified or amended
except in writing.
SECTION 7.09 Counterparts. This Agreement, including all agreements
executed and delivered hereunder, may be executed in two or more counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
SECTION 7.10 Time. Time is of the essence of this Agreement.
IN WITNESS WHEREOF, each of the Sellers and the Buyer has executed this
Agreement or caused this Agreement to be executed on its behalf by its duly
authorized representative, as of the day and year first above written.
BUYER:
VOXCOM HOLDINGS, INC.
By: /s/ Donald G. McLellan
-----------------------------
Donald G. McLellan, President
SELLER:
/s/ Gary Raabe
----------------------------------
Gary Raabe
- 11 -
<PAGE>
EXHIBIT "A"
Number of Percentage of
Seller Shares Owned Purchase Price
Gary Raabe 100%
- 12 -
EMPLOYMENT AGREEMENT
This Employment Agreement is entered into as of the 1st day of April,
1998, between MAXpc TECHNOLOGIES, INC., a Texas corporation (hereinafter
referred to as "Employer"), GARY RAABE (hereinafter referred to as "Employee"),
and Voxcom Holdings, Inc., the parent corporation of Employer (hereinafter
referred to as "Voxcom").
In consideration of the mutual promises hereinafter set forth, the
parties hereto agree as follows:
1. Employment. Employer agrees to employ Employee and Employee agrees
to serve Employer, upon the terms and conditions hereinafter set forth.
2. Term. The employment of Employee hereunder and this Employment
Agreement shall commence the date hereof and shall continue in effect for a
period of three years from the date hereof or until terminated pursuant to
Section 7 hereof.
3. Duties. During the term of this Agreement, Employee shall be engaged
as the chief executive officer of Employer and shall report to the Board of
Directors of Employer. Employee's title shall be President and Chief Executive
Officer of Employer, with such powers and duties in those capacities as are set
forth in the Bylaws of Employer. Employee shall perform his duties from the
Employer's main office in Dallas, Texas.
4. Extent of Services. During the term of this Agreement, Employee
shall devote substantially his entire working time, attention, and energies to
the business of Employer, consistent with the time and effort he has devoted to
the business of Employer in the past, and shall not during the term of service
be actively engaged in any other business activities. However, this shall not be
construed as preventing Employee from investing the Employee's personal assets
in such form or manner as may require occasional or incidental services on the
part of Employee in the management, conservation and protection of such
investments and provided that such investments cannot be construed as being
competitive or in conflict with the business of Employer.
5. Compensation.
5.1. Base Salary. Employer will pay Employee during the Employee's term
of service hereunder, as compensation for the Employee's services, the sum of
$7,000 per month (sometimes hereinafter referred to as the "Base Salary"),
payable in biweekly or other installments in accordance with the general
practices of the Employer. Employee shall be entitled to participate in any and
all executive bonus programs of Employer and Voxcom at levels equal to those of
employees in comparable executive positions. Any bonus compensation shall be
payable in the discretion of the Board of Directors of the Employer.
<PAGE>
5.2. Benefits.
5.2.1. The Employee shall be entitled to the same benefits generally
provided to other executives of Employer and Voxcom of comparable rank and
responsibility as well as to those generally provided to all officers of
Employer and Voxcom in accordance with the policies of Voxcom from time to time.
These are to include, but not be limited to, health insurance and vacation
pursuant to Voxcom's standard policies.
5.2.2. The Employer shall compensate or provide the designated
beneficiaries of Employee with the benefits accrued or vested under any
compensation and/or other benefit plan of the Employer in which Employee was a
participant as of the date of his death.
5.3 Bonus. Employee shall be paid a bonus within thirty (30) days
after the close of each calendar quarter in an amount equal to 25% of the net
profit of Employer for the quarter then ended, in addition to all amounts paid
in salary under Section 5.1. Net profit shall be determined in accordance with
generally accepted accounting principles, and shall reflect a deduction for
federal income tax that would be paid by Employer if it were a separate
corporation. Prior to making such payment to Employee, Employee may elect to
utilize the cash otherwise payable to him to purchase additional shares of
Employer's Common Stock at a purchase price of $5.00 per share, up to a maximum
of 800,000 shares. Employee shall also be paid a sign-on bonus upon the
execution of this Agreement in the sum of $30,000.
6. Expenses. During the term of employment provided for
herein, Employer shall pay or reimburse Employee, in accordance with its
standard policy, upon submission of vouchers by the Employee for all expenses
incurred by the Employee in the interest of Employer's business.
7. Termination.
7.1. Termination Events. Subject to the provisions of Paragraph 7.2
of this Section, this Agreement shall terminate:
7.1.1. Upon death of Employee.
7.1.2. At the option of the Employer if Employee shall become disabled
and remain disabled for a period of six (6) months. Disability shall be defined
as Employee's inability through illness or other cause to perform his normal
work load as measured by the twelve (12) months preceding the commencement of
such disability. During such disability, Employee shall be compensated in
accordance with Employer's standard policy regarding disability.
7.1.3. Upon mutual agreement.
7.1.4. At any time at the option of Employee.
EMPLOYMENT AGREEMENT Page 2
<PAGE>
7.1.5. At the Employer's option for any good cause. For purposes of
this Section, "good cause" for termination shall mean: (a) the conviction of
Employee of any act involving moral turpitude, (b) any material breach by
Employee of any of the terms of, or the failure to perform any covenant
contained in, this Agreement, (c) any material breach of the terms of the Stock
Purchase Agreement between Employee and Voxcom Holdings, Inc., or (d) the
failure of the Company to have achieved a minimum level of sales of 4,000
multimedia computer boards (or their equivalent) during any month during the
first year after the execution hereof, at a gross margin of at least 33 1/3%.
7.1.6. Upon the conclusion of the term of this Agreement.
7.2. Consequences of Termination. Upon termination pursuant to
Section 7.1, the Employee shall be paid all salary prorated to the date of
termination.
8. Trade Secrets and Confidential Information. During the term of
this Agreement, Employee will have access to customer lists and compilations of
information and records specific to and regularly used in the operation of the
business of Employer. Employee acknowledges that such information constitutes
valuable and confidential information of the Employer. Employee shall not
disclose any of the aforesaid private company secrets, directly or indirectly,
nor use them in any way, either during the term of this Agreement or after
termination of employment. All files, records, electronic and magnetic files,
documents, specifications, equipment and similar information relating to the
business of Employer, whether prepared by Employee or otherwise coming into
Employee's possession, shall remain the exclusive property of Employer and shall
not be removed from the premises of Employer except as shall be necessary for
Employee to perform Employee's duties under this Agreement. Upon termination of
this Agreement for any reason, Employee will deliver all such materials in his
possession and all copies thereof to Employer.
9. Non-competition.
9.1. Employee acknowledges that during the term of this Agreement
the Employer has agreed to provide to him, and he shall receive from the
Employer, special training and knowledge. Employee acknowledges that included in
the special knowledge received is the confidential information identified in
Section 8. Employee acknowledges that this confidential information is valuable
to the Employee and, therefore, its protection and maintenance constitutes a
legitimate interest to be protected by the Employer by the enforcement of this
covenant not to complete. Therefore, Employee agrees that during the term of
this Agreement and for a period commencing upon the termination of the term of
Employee's employment hereunder and ending upon the second anniversary thereof,
unless otherwise extended pursuant to the terms hereof, Employee will not,
directly or indirectly, either as an employee, employer, consultant, agent,
principal, partner, stockholder, corporate officer, director, or in any other
individual or representative capacity, engage or participate in any business
that is in direct competition with the business of the Employer as it exists
upon the termination of the term of Employee's employment hereunder, anywhere
within the State of Texas. Employee represents to the Employer that the
enforcement
EMPLOYMENT AGREEMENT Page 3
<PAGE>
of the restriction contained in this Section 9 would not be unduly burdensome to
Employee. Employee further represents and acknowledges that Employee is willing
and able to compete in other geographical areas not prohibited by this Section
9.
9.2. Employee agrees that a breach or violation of this covenant not
to compete by such Employee shall entitle the Employer, as a matter of right, to
an injunction issued by any court of competent jurisdiction, restraining any
further or continued breach or violation of this covenant. Such right to an
injunction shall be cumulative and in addition to, and not in lieu of, any other
remedies to which the Employer may show itself justly entitled. Further, during
any period in which Employee is in breach of this covenant not to compete, the
time period of this covenant shall be extended for an amount of time that
Employee is in breach hereof.
9.3. In addition to the restrictions set forth in paragraph (a) of
this Section 9, Employee shall not for a period commencing upon the termination
of the term of Employee's engagement hereunder and ending upon the second
anniversary thereof, either directly or indirectly, (i) make known to any
person, firm or corporation the names and addresses of any of the customers of
the Employer or contacts of the Employer within the custom sign making industry
or any other information pertaining to such persons, (ii) call on, solicit, or
take away, or attempt to call on, solicit or take away any of the customers of
the Employer on whom Employee called or with whom Employee became acquainted
during Employee's association with the Company, whether for Employee or for any
other person, firm or corporation within the State of Texas or (iii) recruit or
hire or attempt to recruit or hire, directly or by assisting others, any other
employee of the Employer or any of its affiliates.
9.4. The representation and covenants contained in this Section 9
on the part of Employee will be construed as ancillary to and independent of any
other provision of this Agreement, and the existence of any claim or cause of
action of Employee against the Employer or any officer, director, or shareholder
of the Employer or any officer, director, or shareholder of the Employer,
whether predicated on this Agreement or otherwise, shall not constitute a
defense to the enforcement by the Employer of the covenants of the Employee
contained in this Section 9. In addition, the provisions of this Section 9 shall
continue to be binding upon Employee in accordance with its terms,
notwithstanding the termination of Employee's engagement hereunder for any
reason.
9.5. If Employee violates any covenant contained in this Section 9
and the Employer brings legal action for injunctive or other relief, the
Employer shall not, as a result of the time involved in obtaining the relief, be
deprived of the benefit of the full period of any such covenant. Accordingly,
the covenants of Employee contained in this Section 9 shall be deemed to have
durations as specified above, which periods shall commence upon the later of (i)
the termination of the term of Employer's employment hereunder and (ii) the date
of entry by a court of competent jurisdiction of a final judgment enforcing the
covenants of Employee in this Section 9.
9.6. The parties to this Agreement agree that the limitations
contained in this Section 9 with respect to geographic area, duration and scope
of activity are reasonable. However, if any
EMPLOYMENT AGREEMENT Page 4
<PAGE>
court shall determine that the geographic area, duration or scope of activity of
any restriction contained in this Section 9 is unenforceable, it is the
intention of the parties that such restrictive covenant set forth herein shall
not thereby be terminated but shall be deemed amended to the extent required to
render it valid and enforceable.
10. General Provisions.
10.1. Notice. Any notice required or permitted to be given under this
Agreement shall be sufficient if in writing and sent by certified mail by
Employer to the residence of Employee, or by Employee to Employer's principal
office.
10.2. Successors and Assigns. This Agreement shall be binding upon and
shall inure to the benefit of the Employer, its successors and assigns, and the
Employer shall require any successor or assign to expressly assume and agree to
perform this Agreement in the same manner and to the same extent that the
Employer would be required to perform if no such succession or assignment had
taken place. The term "Employer" as used herein shall include successors and
assigns. The term "successors and assigns" as used herein shall mean a
corporation or other entity acquiring all or substantially all the assets and
business of the Employer (including this Agreement) whether by operation of law
or otherwise. Neither this Agreement nor any right or interest hereunder shall
be assignable or transferable by the Employee, his beneficiaries or legal
representatives, except by will or by the laws of descent and distribution. This
Agreement shall inure to the benefit of and be enforceable by the Employee's
legal personal representative.
10.3. Waiver of Breach. The waiver by Employer or Employee of a breach
of any provisions of this Agreement by the other shall not operate or be
construed as a waiver of any subsequent breach.
10.4. Entire Agreement. This instrument contains the entire agreement
of the parties. It may not be changed orally, but only by an agreement in
writing, signed by the party against whom enforcement of any waiver, change,
modification, extension or discharge is sought.
10.5. Attorneys' Fees. In the event that there shall be any litigation
or court proceeding with respect to this Agreement or the obligations of the
parties hereunder, the prevailing party shall be entitled to recover reasonable
attorneys' fees and costs from the other party.
10.6. Governing Law. This Employment Agreement shall be governed by
the laws of the State of Texas.
10.7. Arbitration. The Employer and Employee agree to submit to final
and binding arbitration any and all disputes, claims (whether in tort, contract,
statutory, or otherwise) and/or disagreements concerning the interpretation or
application of this Agreement and/or Employee's engagement by the Employer
and/or the termination of this Agreement and/or Employee's engagement by the
Employer; provided, however, notwithstanding the foregoing, in no event shall
any dispute, claim or disagreement arising under this Agreement be submitted to
arbitration
EMPLOYMENT AGREEMENT Page 5
<PAGE>
pursuant to this Section or otherwise. Any such dispute, claim and/or
disagreement subject to arbitration pursuant to the terms of this Section shall
be resolved by arbitration in accordance with the Commercial Arbitration Rules
of the American Arbitration Association (the "AAA"). Arbitration under this
provision must be initiated within 30 days of the action, inaction, or
occurrence about which the party initiating the arbitration is complaining.
Within 10 days of the initiation of an arbitration hereunder, each party will
designate an arbitrator pursuant to Rule 14 of the AAA Rules. The appointed
arbitrators will appoint a neutral arbitrator from the panel in the manner
prescribed in Rule 13 of the AAA Rules. Employee and the Employer agree that the
decision of the arbitrators selected hereunder will be final and binding on both
parties. This arbitration provision is expressly made pursuant to and shall be
governed by the Federal Arbitration Act, 9 U.S.C. Sections 1 - 14. The parties
hereto agree that pursuant to Section 9 of the Act that a judgment of the United
States District Court for the North District of Texas, Dallas Division, shall be
entered upon the award made pursuant to the arbitration.
IN WITNESS WHEREOF, Employer has caused this Employment Agreement to be
executed in its corporate name by its corporate officers thereunto duly
authorized, and Employee has executed this Employment Agreement.
EMPLOYEE:
/s/ Gary Raabe
------------------------------------
GARY RAABE
EMPLOYER:
MAXpc TECHNOLOGIES, INC.
By: /s/ Donald G. McLellan
----------------------------------
Donald G. McLellan, Vice President
VOXCOM HOLDINGS, INC.
By: /s/ Donald G. McLellan
---------------------------------
Donald G. McLellan, President
Page 6
CORPORATE CHARTER
I, DEAN HELLER, the duly elected and qualified Nevada Secretary of State, do
hereby certify that NEWCORP ONE, INC. did on September 5, 1996 file in this
office the original Articles of Incorporation; that said Articles are now on
file and of record in the office of the Secretary of State of the State of
Nevada, and further, that said Articles contain all the provisions required by
the law of said State of Nevada.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed
the Great Seal of State, at my office, in Carson City,
Nevada, on September 5, 1996.
/s/ Dean Heller
Secretary of State
(seal) By /s/ Beverly J. Davenport
Certification Clerk
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<PAGE>
ARTICLES OF INCORPORATION
OF
NEWCORP ONE INC.
The undersigned, for the purpose of forming a corporation pursuant to
and by virtue of Chapter 78 of the Nevada Revised Statutes, hereby certifies and
adopts the following Articles of Incorporation.
ARTICLE I - NAME
The name of this corporation is Newcorp One Inc.
ARTICLE II - REGISTERED OFFICE AND AGENT
The location of the registered office of the corporation in the State
of Nevada is 1098 Lucerne Way, P.O. Box 7202, Incline Village, Nevada 89450.
The resident agent of the corporation is Daniel Lezak, whose address is
1098 Lucerne Way, P.O. Box 7202, Incline Village, Nevada 89450.
The corporation may also maintain an office or offices at such other
place or places, and where meetings of the Board of Directors and the
stockholders may be held, either within or without the State of Nevada, as may
be determined, from time to time, by the Board of Directors.
ARTICLE III - PURPOSES
The purpose for which this corporation is organized is to engage in any
business or activity not forbidden by law or these Articles of Incorporation.
ARTICLE IV - CAPITAL STOCK
Section 1. Authorized Shares.
(A) The aggregate number of shares which the corporation
shall have authority to issue is 50,000,000 shares of
common stock with a par value of $.0001 per share and
50,000,000 shares of preferred stock with a par value
of $.0001 per share.
(B) Each shareholder of record shall have one vote for
each share of common stock standing in his or her
name on the books of the corporation. Cumulative
voting for directors shall not be permitted. voting
rights of preferred shares shall be determined by the
board of directors. The board of directors shall
determine the rights, preferences and privileges of
the
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preferred shares. Preferred shares may be issued in
one or more series as the board of directors shall
determine.
(C) At all meetings of shareholders, holders of a
majority of the shares entitled to vote at such
meeting, represented in person or by proxy, shall
constitute a quorum.
(D) No shareholder of the corporation shall have any
preemptive or other right to subscribe for any
additional shares of stock or for securities of a
class, or for rights, warrants or options to purchase
stock or for scrip, or for securities of any kind
convertible into stock or carrying stock purchase
warrants or privileges.
Section 2. Consideration for Shares. The shares of capital stock
authorized by Section 1 of this Article shall be issued for such consideration a
shall be fixed, from time to time, by the Board of Directors. In the absence of
fraud, the judgment of the directors as to the value of any property received in
full or partial payment for shares shall be conclusive.
ARTICLE V - DIRECTORS
The members of the governing board of the corporation shall be styled
directors. Pursuant to Nevada Revised Statutes Section 78.115, the number of
directors shall be at least three (3), except in those cases where all the
shares of the corporation are owned beneficially and of record by less than
three (3) stockholders. The name and post office address of the directors
constituting the first board of directors, which shall be one (1) in number,
are:
NAME POST OFFICE ADDRESS
Daniel Lezak 1098 Lucerne Way, P.O. Box 7202
Incline Village, Nevada 89450
ARTICLE VI - ASSESSMENT OF STOCK
The capital stock of this corporation, after the amount of the
subscription price has been fully paid in, shall not be assessable for any
purpose, and no stock issued as fully paid-up shall ever be assessable or
assessed. The holders of such stock shall not be individually responsible for
the debts, contracts, or liabilities of the corporation and shall not be liable
for assessments to restore impairments in the capital of the corporation. The
Articles of Incorporation shall not be amended in this particular.
ARTICLE VII - INCORPORATIONS
The name and the post office address of the incorporator signing these
Articles of Incorporation is as follows:
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<PAGE>
NAME POST OFFICE ADDRESS
Jody C. Fontenot 25241 Buckskin Drive
Laguna Hills, California 92653
ARTICLE VIII - DURATION
The Corporation shall have perpetual existence.
ARTICLE IX
Section 1. Limitation of Personal Liability. The personal liability of
the directors of the corporation is hereby eliminated to the fullest extent
permitted by the General Corporation Law of the State of Nevada, as the same may
be amended and supplemented.
Section 2. Indemnification. The corporation shall, to the fullest
extent permitted by the General Corporation Law of the State of Nevada, as the
same may be amended and supplemented, indemnify the directors and officers of
the corporation from and against any and all of the expenses, liabilities, or
other matters referred to in or covered by said Law, and the indemnification
provided for herein shall not be deemed exclusive of any other rights to which
those indemnified may be entitled under any Bylaw, agreement, vote of
stockholders or disinterested directors or otherwise, both as to action in his
official capacity while holding such office, and shall continue as to a person
who has ceased to be director or officer and shall inure to the benefit of the
heirs, executors, and administrators of such person.
IN WITNESS WHEREOF, I have executed these Articles of Incorporation
this 27th day of August, 1996.
/s/ Jody C. Fontenot
----------------------------------
Jody C. Fontenot, Incorporator
4
<PAGE>
RESTATED ARTICLES OF INCORPORATION
OF
NEWCORP ONE, INC.
The Articles of Incorporation of Newcorp One, Inc., a Nevada
corporation, are hereby amended and restated in their entirety as follows,
pursuant to Art. 78.403, Nevada Revised Statutes, by the full Board of Directors
of the Corporation, there being no shares of stock issued.
I.
EXISTING ARTICLES
The Articles of Incorporation of the Corporation in effect prior to the
filing hereof are as follows:
ARTICLE I - NAME
The name of this corporation is Newcorp One Inc.
ARTICLE II - REGISTERED OFFICE AND AGENT
The location of the registered office of the corporation in the State
of Nevada is 1098 Lucerne Way, P.O. Box 7202, Incline Village, Nevada 89450.
The resident agent of the corporation is Daniel Lezak, whose address is
1098 Lucerne Way, P.O. Box 7202, Incline Village, Nevada 89450.
The corporation may also maintain an office or offices at such other
places or places, and where meetings of the Board of Directors and the
stockholders may be held, either within or without the State of Nevada, as may
be determined, from time to time, by the Board of Directors.
ARTICLES III - PURPOSES
The purpose of for which this corporation is organized is to engage in
any business or activity not forbidden by law or these Articles of
Incorporation.
ARTICLE IV - CAPITAL STOCK
Section 1. Authorized Shares.
(A) The aggregate number of shares which the corporation
shall have authority to issue is 50,000,000 shares of
common stock with a par value of $.0001 per share and
50,000,000 shares of preferred stock with a par value
of $.0001 per share.
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(B) Each shareholder of record shall have one vote for
each share of common stock standing in his or her
name on the books of the corporation. Cumulative
voting for directors shall not be permitted. Voting
rights of preferred shares shall be determined by the
board of directors. The board of directors shall
determine the rights, preferences and privileges of
the preferred shares. Preferred shares may be issued
in one or more series as the board of directors shall
determine.
(C) At all meetings of shareholders, holders of a
majority of the shares entitled to vote at such
meeting, represented in person or by proxy, shall
constitute a quorum.
(D) No shareholder of the corporation shall have any
preemptive or other right to subscribe for any
additional shares of stock or for securities of a
class, or for rights, warrants or options to purchase
stock or for scrip, or for securities of any kind
convertible into stock or carrying stock purchase
warrants or privileges.
Section 2. Consideration for Shares. The shares of capital stock
authorized by Section 1 of this Article shall be issued for such consideration
as shall be fixed, from time to time, by the Board of Directors. In the absence
of fraud, the judgment of the directors as to the value of any property received
in full or partial payment for shares shall be conclusive.
ARTICLE V - DIRECTORS
The members of the governing board of the corporation shall be styled
directors. Pursuant to Nevada Revised Statutes Section 78.115, the number of
directors shall be at least three (3), except in those cases where all the
shares of the corporation are owned beneficially and of record by less than
three (3) stockholders. The name and post office address of the directors
constituting the first board of directors, which shall be one (1) in number,
are:
NAME POST OFFICE ADDRESS
Daniel Lezak 1098 Lucerne Way, P.O. Box 7202
Incline Village, Nevada 89450
ARTICLE VI - ASSESSMENT OF STOCK
The capital stock of this corporation, after the amount of the
subscription price has been fully paid in, shall not be assessable for any
purpose, and no stock issued as fully paid-up shall ever be assessable or
assessed. The holders of such stock shall not be individually responsible for
the debts, contracts, or liabilities of the corporation shall not be liable for
assessments to restore impairments in the capital of the corporation. The
Articles of Incorporation shall not be amended in this particular.
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<PAGE>
ARTICLE VII - INCORPORATORS
The name and the post office address of the incorporator signing these
Articles of Incorporation is as follows:
NAME ADDRESS
Jody C. Fontenot 25241 Buckskin Drive
Laguna Hills, California 92653
ARTICLE VIII - DURATION
The corporation shall have perpetual existence.
ARTICLE IX
Section 1. Limitation of Personal Liability. The personal liability of
the directors of the corporation is hereby eliminated to the fullest extent
permitted by the General Corporation Law of the State of Nevada, as the same may
be amended and supplemented.
Section 2. Indemnification. The corporation shall, to the fullest
extent permitted by the General Corporation Law of the State of Nevada, as the
same may be amended and supplemented, indemnify the directors and officers of
the corporation from and against any and all of the expenses, liabilities, or
other matters referred to in or covered by said Law, and the indemnification
provided for herein shall not be deemed exclusive of any other rights to which
those indemnified may be entitled under any Bylaw, agreement, vote of
stockholders or disinterested directors or otherwise, both as to action in his
official capacity while holding such office, and shall continue as to a person
who has ceased to be a director or officer and shall inure to the benefit of the
heirs, executors, and administrators of such person.
ARTICLE II.
AMENDMENTS
The following amendments were adopted on June 10, 1997 by action of the
Board of Directors of the Corporation:
A. Article I is amended to change the name of the Corporation to Voxcom
Holdings, Inc.
B. Article II is amended to change the Registered Agent to Capital
Document Services, Inc., 400 West King Street, Suite 302, Carson City, Nevada
89703.
C. Article IV is amended to increase the number of authorized shares of
Common Stock from 50,000,000 to 100,000,000 and to define the manner in which
shares may be issued in series or classes.
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<PAGE>
D. Article V is amended to add provisions regarding corporate
management and control.
ARTICLE III
RESTATED ARTICLES OF INCORPORATION
The Articles of Incorporation, as amended and restated, are as follows:
ARTICLE I - NAME
The name of this corporation is Voxcom Holdings, Inc..
ARTICLE II - REGISTERED OFFICE AND AGENT
The location of the registered office of the corporation in the State
of Nevada is 400 West King Street, Suite 302, Carson City, Nevada 89703.
The resident agent of the corporation is Registered Agent to Capital
Document Services, Inc., 400 West King Street, Suite 302, Carson City, Nevada
89703.
The corporation may also maintain an office or offices at such other
places or places, and where meetings of the Board of Directors and the
stockholders may be held, either within or without the State of Nevada, as may
be determined, from time to time, by the Board of Directors.
ARTICLES III - PURPOSES
The purpose of for which this corporation is organized is to engage in
any business or activity not forbidden by law or these Articles of
Incorporation.
ARTICLE IV - CAPITAL STOCK
The Corporation shall have authority to issue two classes of stock, and
the total number authorized shall be one hundred million (100,000,000) shares of
Common Stock of the par value of $0.0001 each, and fifty million (50,000,000)
shares of Preferred Stock of the par value of $0.0001 each. A description of the
different classes of stock of the Corporation and a statement of the
designations and the powers, preferences and rights, and the qualifications,
limitations or restrictions thereof, in respect of each class of such stock are
as follows:
1. Issuance in Class or Series. The Preferred Stock may be issued from
time to time in one or more series, or divided into additional classes and such
classes into one or more series. The terms of a class or series, including all
rights and preferences, shall be as specified in the resolution or resolutions
adopted by the Board of Directors designating such class or series, which
resolution or resolutions the Board of Directors is hereby expressly authorized
to adopt. Such resolution or resolutions with respect to a class or series shall
specify all or such of the rights or preferences of such class or series as the
Board of Directors shall determine, including the following, if applicable: (a)
the number of shares to constitute such class or series and the distinctive
designation thereof; (b)
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<PAGE>
the dividend or manner for determining the dividend payable with respect to the
shares of such class or series and the date or dates from which dividends shall
accrue, whether such dividends shall be cumulative, and, if cumulative, the date
or dates from which dividends shall accumulate and whether the shares in such
class or series shall be entitled to preference or priority over any other class
or series of stock of the Corporation with respect to payment of dividends; (c)
the terms and conditions, including price or a manner for determining the price;
of redemption, if any, of the shares of such class or series; (d) the terms and
conditions of a retirement or sinking fund, if any, for the purchase or
redemption of the shares of such class or series; (e) the amount which the
shares of such class or series shall be entitled to receive, if any, in the
event of any liquidation, dissolution or winding up of the Corporation and
whether such shares shall be entitled to a preference or priority over shares of
another class or series with respect to amounts received in connection with any
liquidation, dissolution or winding up of the Corporation; (f) whether the
shares of such class or series shall be convertible into, or exchangeable for,
shares of stock of any other class or classes, or any other series of the same
or any other class or classes of stock, of the Corporation and the terms and
conditions of any such conversion or exchange; (g) the voting rights, if any, of
shares of stock of such class or series in addition to those granted herein; (h)
the status as to reissuance or sale of shares of such class or series redeemed,
purchased or otherwise reacquired, or surrendered to the Corporation upon
conversion; (i) the conditions and restrictions, if any, on the payment of
dividends or on the making of other distributions on, or the purchase,
redemption or other acquisition by the Corporation or any subsidiary, of any
other class or series of stock of the Corporation ranking junior to such shares
as to dividends or upon liquidation; and (j) the conditions, if any, on the
creation of indebtedness of the Corporation, or any subsidiary; and (i) such
other preferences, rights, restrictions and qualifications as the Board of
Directors may determine.
All shares of the Common Stock shall be of the same class and shall
have equal dividend or distribution, liquidation and other rights.
All shares of the Common Stock shall rank equally, and all shares of
the Preferred Stock shall rank equally, and be identical within their classes in
all respects regardless of series, except as to terms which may be specified by
the Board of Directors pursuant to the above provisions. All shares of any one
series of a class of Preferred Stock shall be of equal rank and identical in all
respects, except that shares of any one series issued at different times may
differ as to the dates which dividends thereon shall accrue and be cumulative.
2. Other Provisions. Shares of Common Stock or Preferred Stock of any
class or series may be issued with such voting powers, full or limited, or no
voting powers, and such designations, preferences and relative participating,
option or special rights, and qualifications, limitations or restrictions
thereof, as shall be stated and expressed in the resolution or resolutions
providing for the issuance of such stock adopted by the Board of Directors. Any
of the voting powers, designations, preferences, rights and qualifications,
limitations or restrictions of any such class or series of stock may be made
dependent upon facts ascertainable outside the resolution or resolutions of the
Board of Directors, provided the manner in which such facts shall operate upon
the voting powers, designations, preferences, rights and qualifications,
limitations or restrictions or such class or series is clearly set forth in the
resolution or resolutions providing for the issue of such stock adopted by the
Board of Directors. Shares of Common or Preferred Stock reacquired by the
Corporation shall
9
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be no longer be deemed outstanding and shall have no voting or other rights
unless and until reissued. Shares reacquired by the Corporation may be canceled
and restored to the status of authorized and unissued stock by action of the
Board of Directors.
3. Common Stock. Except as otherwise provided in any resolution or
resolutions adopted by the Board of Directors, the Common Stock shall (a) have
the exclusive voting power of the corporation; (b) entitle the holders thereof
to one vote per share at all meetings of the stockholders of the Corporation;
(c) entitle the holders to share ratably, without preference over any other
shares of the Corporation, in all assets of the Corporation in the event of any
dissolution, liquidation or winding up of the Corporation; and (d) entitle the
record holder thereof on such record dates as are determined, from time to time,
by the Board of Directors to receive such dividends, if any, if, as and when
declared by the Board of Directors.
ARTICLE V - DIRECTORS
1. Designations. The governing board of the Corporation shall be
styled as a "Board of Directors," and any member of said Board shall be styled
as a "Director."
The number of members constituting the Board of Directors at the date
of this Amendment is one (1); and the name and the post office address of each
of said members are as follows:
NAME ADDRESS
Daniel Lezak 1098 Lucerne Way
Incline Village, Nevada 89450
2. Number, Election and Terms of Directors. The business and affairs of
the Corporation shall be managed by a Board of Directors, which, subject to the
rights of holders of shares of any class of series of Preferred Stock of the
Corporation then outstanding to elect additional Directors under specified
circumstances, shall consist of not less than one nor more than twenty-one
persons. The exact number of Directors within the minimum and maximum
limitations specified in the preceding sentence shall be fixed from time to time
by either (i) the Board of Directors pursuant to a resolution adopted by a
majority of the entire Board of Directors, (ii) the affirmative vote of the
holders of two-thirds or more of the voting power of all of the shares of the
Corporation entitled to vote generally in the election of Directors voting
together as a single class, or (iii) pursuant to Paragraph 7 of Article Nine
hereof. No decrease in the number of Directors constituting the Board of
Directors shall shorten the term of any incumbent Director.
3. Stockholder Nomination of Director Candidates. Advance notice of
stockholder nominations for the election of Directors shall be at least 60 days
in advance of the month and day in which the annual meeting of stockholders was
held in the previous year.
4. Newly-Created Directorships and Vacancies. Subject to the rights of
the holders of any series of any Preferred Stock then outstanding, newly-created
directorships resulting from any increase in the authorized number of Directors
and any vacancies in the Board of Directors resulting
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from the death, resignation, retirement, disqualification, removal from office
or other cause may be filled by a majority vote of the Directors then in office
even though less than a quorum, or by a sole remaining Director.
5. Removal. Subject to the rights of the holders of any series of any
Preferred Stock then outstanding, any Director or the entire Board of Directors,
may be removed from office at any annual or special meeting called for such
purpose, and then only for cause and only by the affirmative vote of the holders
of two-thirds or more of the voting power of all of the shares of the
Corporation entitled to vote generally in the election of Directors, voting
together as a single class. As used herein, cause shall mean only the following:
proof beyond the existence of a reasonable doubt that a Director has been
convicted of a felony, committed gross negligence or willful misconduct
resulting and a material detriment to the Corporation, or committed a material
breach of his fiduciary duty to the Corporation resulting in a material
detriment to the Corporation.
6. Amendment, Repeal, etc. Notwithstanding anything contained in these
Articles of Incorporation to the contrary, the affirmative vote of the holders
of two-thirds or more of the voting power of all of the shares of the
Corporation entitled to vote generally in the election of Directors, voting
together as a single class, shall be required to alter, amend or adopt any
provision inconsistent with or repeal this Article Seven, or to alter, amend,
adopt any provision inconsistent with or repeal comparable sections of the
Bylaws of the Corporation.
7. Special Meetings of Stockholders. Notwithstanding anything contained
in these Articles of Incorporation to the contrary, the affirmative vote of the
holders of two-thirds or more of the voting power of all shares of the
Corporation entitled to vote generally in the election of Directors, voting
together as a single class, shall be required to call a special meeting of
stockholders or to alter, amend, adopt any provision inconsistent with or repeal
this Article Eight, or to alter, amend, adopt any provision inconsistent with
comparable sections of the Bylaws.
ARTICLE VI - ASSESSMENT OF STOCK
The capital stock of this corporation, after the amount of the
subscription price has been fully paid in, shall not be assessable for any
purpose, and no stock issued as fully paid-up shall ever be assessable or
assessed. The holders of such stock shall not be individually responsible for
the debts, contracts, or liabilities of the corporation shall not be liable for
assessments to restore impairments in the capital of the corporation. The
Articles of Incorporation shall not be amended in this particular.
ARTICLE VII - INCORPORATORS
The name and the post office address of the incorporator signing these
Articles of Incorporation is as follows:
NAME ADDRESS
Jody C. Fontenot 25241 Buckskin Drive
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Laguna Hills, California 92653
ARTICLE VIII - DURATION
The corporation shall have perpetual existence.
ARTICLE IX
Section 1. Limitation of Personal Liability. The personal liability of
the directors of the corporation is hereby eliminated to the fullest extent
permitted by the General Corporation Law of the State of Nevada, as the same may
be amended and supplemented.
Section 2. Indemnification. The corporation shall, to the fullest
extent permitted by the General Corporation Law of the State of Nevada, as the
same may be amended and supplemented, indemnify the directors and officers of
the corporation from and against any and all of the expenses, liabilities, or
other matters referred to in or covered by said Law, and the indemnification
provided for herein shall not be deemed exclusive of any other rights to which
those indemnified may be entitled under any Bylaw, agreement, vote of
stockholders or disinterested directors or otherwise, both as to action in his
official capacity while holding such office, and shall continue as to a person
who has ceased to be a director or officer and shall inure to the benefit of the
heirs, executors, and administrators of such person.
ARTICLE IV - CERTIFICATE
A. The undersigned constitutes the full Board of Directors of the
Corporation.
B. The Corporation was formed with the filing of Articles of
Incorporation on September 5, 1996.
C. On the date of this certification, no stock of the Corporation has
been issued.
IN WITNESS WHEREOF, these Restated Articles of Incorporation were
executed by the Sole Director of the Corporation on this 15th day of June, 1997.
/s/ Daniel Lezak
---------------------------
Daniel Lezak, Sole Director
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<PAGE>
STATE OF CALIFORNIA )
)
COUNTY OF LOS ANGELES )
This instrument was acknowledged before me on this 15th day of June,
1997, by Daniel Lezak.
(SEAL) /s/ Notary Public
--------------------------------
Notary Public in and for the
State of California
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<PAGE>
CERTIFICATE OF ACCEPTANCE OF
APPOINTMENT BY RESIDENT
AGENT FOR SERVICE OF PROCESS
In the matter of Voxcom Holdings, Inc.,
Capitol Document Services, Inc., with address at 400 West King
Street, Suite 302, City of Carson City, State of Nevada, Zip Code 89703,
hereby accepts appointment as Resident Agent for Service of Process
for the above-named corporation in accordance with NRS 78.090.
CAPITOL DOCUMENT SERVICES, INC.
By:
/s/ Johnathan L. Wright
Signature of Authorized Representative of Resident Agent for Service of Process
June 18, 1997
14
BYLAWS OF
VOXCOM HOLDINGS, INC.
(the "Corporation")
ARTICLE I
Offices
Section 1.1. The registered office of the Corporation shall be in the
County of Carson City, State of Nevada.
Section 1.2. The Corporation may also 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
Meetings of Stockholders
Section 2.1. All meetings of the stockholders for the election of
Directors and for any other purpose may be held at such time and place, within
or without the State of Nevada, as shall be stated in the notice of the meeting
or in a duly executed waiver of notice thereof.
Section 2.2. An annual meeting of the stockholders for the election of
Directors and for the transaction of such other business as may properly come
before the meeting shall be held each year, within six months after the end of
the prior fiscal year at 10:00 a.m. on a date to be selected by the Board of
Directors. At the meeting, the stockholders shall elect directors, and transact
such other business as may properly be brought before the meeting.
Section 2.3. Written notice of the annual meeting stating the place,
date and hour of the meeting shall be given to each stockholder entitled to vote
at such meeting not less than ten (10) nor more than fifty (50) days before the
date of the meeting.
Section 2.4. The officer who has charge of the stock ledger of the
Corporation shall prepare and make, at least ten (10) days before every meeting
of stockholders, a complete list of the stockholders entitled to vote at the
meeting, arranged in alphabetical order, and showing the address of each
stockholder and the number of shares registered in the name of each stockholder,
for any purpose germane to the meeting, which shall be open to the inspection of
any stockholder during ordinary business hours, for a period of at least ten
(10) days prior to the meeting, either at a place within the city where the
meeting is to be held, which place shall be specified in the notice of the
meeting, or, if not so specified, at the place where the meeting is to be held.
The list shall also be produced and kept at the time and place of the meeting
during the whole time thereof, and may be inspected by any stockholder who is
present.
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Section 2.5. Special meetings of the stockholders, for any purpose or
purposes, unless otherwise prescribed by statute or by the Articles of
Incorporation, may be called by the President or by the Board of Directors or by
the written order of a majority of the Directors; and shall be called by the
President or Secretary at the request in writing of stockholders owning
two-thirds or more of the entire capital stock of the Corporation issued and
outstanding and entitled to vote. Such request by the stockholders shall state
the purpose or purposes of the proposed meeting.
Section 2.6. Written notice of a special meeting stating the place,
date and hour of the meeting and the purpose or purposes for which the meeting
is called, shall be given not less than ten (10) nor more than fifty (50) days
before the date of the meeting, to each stockholder entitled to vote at such
meeting.
Section 2.7. Business transacted at any special meeting of stockholders
shall be limited to the purposes stated in the notice.
Section 2.8. The holders of a majority of the stock issued and
outstanding and entitled to vote thereat, present in person or represented by
proxy, shall constitute a quorum at all meetings of the stockholders for the
transaction of business except as otherwise provided by statute, by the Articles
of Incorporation or by these Bylaws. If, however, such quorum shall not be
present or represented at any meeting of the stockholders, the stockholders
entitled to vote thereat, present in person or represented by proxy, shall have
the power to adjourn the meeting from time to time, without notice other than
announcement at the meeting, until a quorum shall be present or represented. At
such adjourned meeting at which a quorum shall be present or represented, any
business may be transacted which might have been transacted at the meeting as
originally notified. If the adjournment is for more than thirty (30) days, or if
after the adjournment a new record date is fixed for the adjourned meeting, a
notice of the adjourned meeting shall be given to each stockholder of record
entitled to vote at the meeting.
Section 2.9. When a quorum is present at any meeting, the vote of the
holders of a majority of the stock having voting power present in person or
represented by proxy shall decide any question brought before such meeting,
unless the question is one upon which by express provision of the statutes,
these Bylaws or of the Articles of Incorporation, a different vote is required,
in which case such express provision shall govern and control the decision of
such question. The stockholders present at a duly organized meeting may continue
to transact business until adjournment, notwithstanding the withdrawal of enough
stockholders to leave less than a quorum.
Section 2.10. Unless otherwise provided in the Articles of
Incorporation, each stockholder shall at every meeting of the stockholders be
entitled to one vote in person or by proxy executed in writing by the
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stockholder or by his or her duly authorized attorney-in-fact, for each share of
the capital stock having voting power held by such stockholder, but no proxy
shall be voted on after six (6) months from its date, unless the proxy provides
for a longer period. Each proxy shall be filed with the Secretary of the
Corporation prior to, or at the time of, the meeting. Any vote may be taken via
voice or by show of hands unless the holders of at least ten percent (10%) of
shares outstanding and entitled to vote object, in which case written ballots
shall be used.
Section 2.11. Any action required to be taken at any annual or special
meeting of stockholders may be taken without a meeting, without prior notice and
without a vote, if a consent or consents in writing, setting forth the action so
taken, shall be signed by the holders of outstanding stock having not less than
the minimum number of votes that would be necessary to authorize or take such
action at a meeting at which all shares entitled to vote thereon were present
and voted, and shall be delivered to the Corporation by hand delivery or
certified mail, return receipt requested, to its registered office in Nevada,
its principal place of business or an officer or agent having custody of the
minute book of the Corporation. The Corporation shall provide a copy thereof to
all stockholders not participating in the consent action. Notwithstanding
anything contained in these Bylaws to the contrary, this Section 2.11 of Article
II may be amended, supplemented, or appealed only by the affirmative vote of the
holders of two-thirds or more of the voting power of all of the shares of the
Corporation entitled to vote generally in the election of Directors, voting
together as a single class.
Section 2.12. Any stockholder proposing to nominate a person for
election to the Board of Directors shall provide the Corporation 60 days prior
written notice of such nomination, stating the name and address of the nominee
and describing his qualifications for being a Director of the Corporation. Such
notice shall be sent or delivered to the principal office of the Corporation to
the attention of the Board of Directors, with a copy to the President and
Secretary of Corporation.
Section 2.13. At any meeting of stockholders, the President of the
Corporation shall act as the chairman of the meeting, and the stockholders shall
not have the right to elect a different person as chairman of the meeting. The
chairman of the meeting shall have the authority to determine (i) when the
election polls shall be closed in connection with any vote to be taken at the
meeting; and (ii) when the meeting shall be recessed. No action taken at a
meeting shall become final and binding if any group of stockholders representing
one-third or more of the shares entitled to be voted for such action shall
contest the validity of any proxies or the outcome of any election.
Section 2.14. The Board of Directors may fix in advance a record date
for the purpose of determining stockholders entitled to notice of, or to vote
at, a meeting of stockholders, such record date to be not less than ten nor more
than fifty days prior to such meeting; or the Board of Directors may close the
stock transfer books for such purpose for a period of not less than ten nor more
than fifty days prior to such meeting. In the absence of any action of the Board
of Directors, the date upon which the notice of the meeting is mailed shall be
the record date.
Section 2.15. The order of business at annual meetings, and so far as
practicable at other meetings of stockholders, shall be as follows unless
changed by the Chairman:
(a) Call to order
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(b) Proof of due notice of meeting
(c) Determination of quorum and examination of proxies
(d) Announcement of availability of voting list (See Bylaw 2.04)
(e) Announcement of distribution of annual statement
(See Bylaw 7.4)
(f) Reading and disposing of minutes of last meeting of
stockholders
(g) Reports of Officers and committees
(h) Appointment of voting inspectors
(i) Unfinished business
(j) New business
(k) Nomination of Directors
(1) Opening of polls for voting
(m) Recess
(n) Reconvening; closing of polls
(o) Report of voting inspectors
(p) Other business
(q) Adjournment
ARTICLE III
Directors
Section 3.1. The business and affairs of the Corporation shall be managed
by a Board of Directors, which shall have and may exercise all of the powers of
the Corporation, except such as are expressly conferred upon the stockholders by
law, by the Articles of Incorporation or by these Bylaws. Subject to the rights
of the holders of shares of any series of Preferred Stock then outstanding to
elect additional Directors under specified circumstances, the Board of Directors
shall consist of not less than three (3) nor more than twenty-one (21) persons.
The exact number of Directors within the minimum and maximum limitations
specified in the preceding sentence shall be fixed from time to time by either
(i) the Board of Directors pursuant to a resolution adopted by a majority of the
entire Board of Directors, (ii) the affirmative vote of the holders of
two-thirds or more of the voting power of all of the shares of the Corporation
entitled to vote generally in the election of Directors, voting together as a
single class, or (iii) the Articles of Incorporation. No decrease in the number
of Directors constituting the Board of Directors shall shorten the term of any
incumbent Director. Each director elected shall hold office until his successor
shall be elected and shall qualify. Subject to the rights of holders of any
series of any Preferred Stock then outstanding, any vacancies in the Board of
Directors resulting from death, resignation, retirement, disqualification,
removal from office or other cause may be filed by a majority vote of the
Directors then in office even though less than a quorum or by a sole remaining
Director and the Directors so chosen shall hold office until the next annual
election and until their successors are duly elected and shall qualify, unless
sooner displaced. If the remaining Directors fail to select a successor Director
to fill a vacancy within sixty (60) days of its occurrence, the vacancy shall be
filled by the vote of a majority of the outstanding shares. If there are no
Directors in office, then an election of Directors may be held in the manner
provided by statute. Newly-created directorships resulting from any increase in
the authorized number of Directors may be filled by the remaining Directors.
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<PAGE>
Directors elected to fill a vacancy will serve the remaining portion of the
unexpired term; provided, however, that Directors elected to fill a vacancy by
virtue of expanding the number of Directors shall serve until the next election
of Directors by stockholders.
Section 3.2. No stockholder shall have the right to cumulate his votes
for the election of Directors but each share shall be entitled to one vote in
the election of such Director. At any meeting of the stockholders, every
stockholder having the right to vote may vote either in person or by proxy
executed in writing by the stockholder or by his duly authorized
attorney-in-fact. Such proxy shall be filed with the Secretary of the
Corporation prior to, or at the time of, the meeting.
Meetings of the Board of Directors
Section 3.3. The Board of Directors of the Corporation may hold
meetings, both regular and special, either within or without the State of
Nevada.
Section 3.4. The first meeting of each newly elected Board of Directors
shall be held without further notice immediately following the annual meeting of
the stockholders, and at the same place unless the Directors change such time or
place by unanimous vote.
Section 3.5. Regular meetings of the Board of Directors may be held
without notice at such time and at such place as shall from time to time be
determined by the Board.
Section 3.6. Special meetings of the Board may be called by the
President or by Directors constituting at least one-third of Directors in
office, on three (3) days' notice to each Director, either personally or by mail
or by telegram.
Section 3.7. At all meetings of the Board, a majority of the Directors
shall constitute a quorum for the transaction of business and the act of a
majority of the Directors present at any meeting at which there is a quorum
shall be the act of the Board of Directors, except as may be otherwise
specifically provided by statute, these Bylaws or by the Articles of
Incorporation. If a quorum shall not be present at any meeting of the Board of
Directors, the Directors present thereat may adjourn the meeting from time to
time, without notice other than announcement at the meeting, until a quorum
shall be present. Each Director who is present at a meeting will be deemed to
have assented to any action taken at such meeting unless his dissent to the
action is entered into the minutes of the meeting, or unless he or she files
their written dissent thereto with the Secretary of the meeting or forwards such
dissent by registered mail to the Secretary of the Corporation immediately after
such meeting.
Section 3.8. Unless otherwise restricted by the Articles of
Incorporation or these Bylaws, any action required or permitted to be taken at
any meeting of the Board of Directors or of any committee thereof may be taken
without a meeting, if all members of the Board or committee, as the case may be,
consent thereto in writing, and the writing or writings are filed with the
minutes of proceedings of the Board or committee.
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Section 3.9. Unless otherwise restricted by the Articles of
Incorporation or these Bylaws, members of the Board of Directors, or any
committee designated by the Board of Directors, may participate in a meeting of
the Board of Directors, or any committee, by means of conference telephone or
similar communications equipment by means of which all persons participating in
the meeting can hear each other, and such participation in a meeting shall
constitute presence in person at the meeting.
Section 3.10. Interested Directors, Officers and stockholders. (a) If
Paragraph (b) is satisfied, no contract or other transaction between the Company
and any of its Directors, Officers or stockholders (or any corporation or firm
in which any of them are directly or indirectly interested) shall be invalid
solely because of such relationship or because of the presence of such Director,
Officer or stockholder at the meeting authorizing such contract or transaction,
or his participation in such meeting or authorization.
(b) Paragraph (a) shall apply only if:
(1) The material facts of the relationship or interest of each
such Director, Officer or stockholder are known or disclosed:
(A) To the Board of Directors and they nevertheless
authorizes or ratifies the contract or transaction by a
majority of the Directors present, each such interested
Director to be counted in determining whether a quorum is
present but not in calculating the majority necessary to carry
the vote; or
(B) To the stockholders and they nevertheless
authorize or ratify the contract or transaction by a majority
of the shares present, each such interested stockholder to be
counted in determining whether a quorum is present but not in
calculating the majority necessary to carry the vote; and
(2) The contract or transaction is fair to the Corporation as
of the time it is authorized or ratified by the Board of Directors, a
committee of the Board or the stockholders.
(c) This provision shall not be construed to invalidate a contract or
transaction which would be valid in the absence of this provision.
Committees of Directors
Section 3.11. The Board of Directors may, by resolution adopted by a
majority of the whole Board, designate an Executive Committee from among its
members.
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<PAGE>
Section 3.12. The Executive Committee shall consist of one or more
Directors. The Executive Committee shall serve at the pleasure of the Board of
Directors.
Section 3.13. The Executive Committee shall have and may exercise the
authority of the Board of Directors in the management of the business and
affairs of the Corporation except where action of the full Board of Directors is
required by statute or by the Articles of Incorporation, and shall have power to
authorize the seal of the Corporation to be affixed to all papers which may
require it; except that the Executive Committee shall not have authority to:
amend the Articles of Incorporation; approve a plan of merger or consolidation;
recommend to the stockholders the sale, lease, or exchange of all or
substantially all of the property and assets of the Corporation other than in
the usual and regular course of its business; recommend to the stockholders the
voluntary dissolution of the Corporation; amend, alter, or repeal the Bylaws of
the Corporation or adopt new Bylaws for the Corporation; fill any vacancy in the
Board of Directors or any other corporate committee; fix the compensation of any
member of any corporate committee; alter or repeal any resolution of the Board
of Directors; declare a dividend; or authorize the issuance of shares of the
Corporation in excess of one million dollars in value. Each Director shall be
deemed to have assented to any action of the Executive Committee unless, within
seven days after receiving actual or constructive notice of such action, he or
she deliver their written dissent thereto to the Secretary of the Corporation.
Section 3.14. The number of Executive Committee members may be
increased or decreased (but not below three) from time to time by resolution
adopted by a majority of the whole Board of Directors.
Section 3.15. Any member of the Executive Committee may be removed by
the Board of Directors by the affirmative vote of a majority of the whole Board
whenever in its judgment the best interests of the Corporation will be served
thereby.
Section 3.16. A vacancy occurring in the Executive Committee (by death,
resignation, removal or otherwise) shall be filled by the Board of Directors in
the manner provided for original designation in Section 3.11 above.
Section 3.17. Time, place and notice, if any, of Executive Committee
meetings shall be determined by the Executive Committee.
Section 3.18. At meetings of the Executive Committee, a majority of the
number of members designated by the Board of Directors shall constitute a quorum
for the transaction of business. The act of a majority of the members present at
any meeting at which a quorum is present shall be the act of the Executive
Committee, except as otherwise specifically provided by the statute or by the
Articles of Incorporation or by these Bylaws. If a quorum is not present at a
meeting of the Executive Committee, the members present thereat may adjourn the
meeting from time to time, without notice other than announcement at the
meeting, until a quorum is present.
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Section 3.19. By resolution of the Board of Directors, the members of
the Executive Committee may be paid their expenses, if any, of attendance at
each meeting of the Executive Committee and may be paid a fixed sum for
attendance at each meeting of the Executive Committee or a stated salary as a
member thereof. No such payment shall preclude any member from serving the
Corporation in any other capacity and receiving compensation therefor.
Section 3.20. The Executive Committee shall keep regular minutes of its
proceedings and report the same to the Board of Directors when required. The
minutes of the proceedings of the Executive Committee shall be placed in the
minute book of the Corporation.
Section 3.21. Any action required or permitted to be taken at a meeting
of the Executive Committee may be taken without a meeting if a consent in
writing, setting forth the action so taken, is signed by all the members of the
Executive Committee. Such consent shall have the same force and effect as a
unanimous vote at a meeting. The signed consent, or a signed copy thereof, shall
be placed in the minute book.
Section 3.22. The designation of an Executive Committee and the
delegation of authority to it shall not operate to relieve the Board of
Directors, or any member thereof, of any responsibility imposed by law.
Section 3.23. The Board of Directors may, by resolution adopted by the
majority of the Directors, designate one or more other committees to conduct the
business and affairs of the Corporation to the extent authorized by the
resolution including but not limited to the following: Audit Committee,
Compensation Committee, Stock Option Committee and Conflict of Interest
Committee. The Board of Directors, by majority vote, shall have the power at any
time to change the powers and members of any committee, to fill vacancies and to
dispose of any committee. Members of any committee shall receive such
compensation as the Board of Directors may from time to time provide. The
designation of any committee and the delegation of authority to such committee
shall not operate to relieve the Board of Directors of any responsibility
imposed by law.
Compensation of Directors
Section 3.24. Unless otherwise restricted by 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 Director. No such payment shall preclude any Director from serving the
Corporation in any other capacity and receiving compensation therefor. Members
of special or standing committees may be allowed like compensation for attending
committee meetings.
ARTICLE IV
Notices
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Section 4.1. Whenever, under the provisions of the statutes or of the
Articles of Incorporation or of these Bylaws, notice is required to be given to
any Director or stockholder, it shall not be construed to mean personal notice,
but such notice may be given in writing, by mail, addressed to such Director or
stockholder, at his address as it appears on the records of the Corporation,
with postage thereon prepaid, and such notice shall be deemed to be given at the
time when the same shall be deposited in the United States mail. Notice to
Directors may also be given by telegram or facsimile.
Section 4.2. Whenever any notice is required to be given under the
provisions of the statutes or of the Articles of Incorporation or of these
Bylaws, a waiver thereof in writing, signed by the person or persons entitled to
said notice, whether before or after the time stated therein, shall be deemed
equivalent thereto.
ARTICLE V
Officers
Section 5.1. The officers of the Corporation shall be chosen by the
Board of Directors and shall be a president, one or more vice presidents, any
one or more of which may be designated executive vice president or senior vice
president, a secretary, and a treasurer. The Board of Directors may also choose
a chairman of the board, assistant vice presidents and one or more assistant
secretaries and assistant treasurers. Any number of offices may be held by the
same person, unless the Articles of Incorporation or these Bylaws otherwise
provide. The Chairman shall be elected from among the Directors.
Section 5.2. The Board of Directors at its first meeting after each
annual meeting of stockholders shall choose a president, one or more vice
presidents, a secretary and a treasurer.
Section 5.3. The Board of Directors may appoint such other officers and
agents as it shall deem necessary who shall hold their offices for such terms
and shall exercise such powers and perform such duties as shall be determined
from time to time by the Board.
Section 5.4. The salaries of all officers and agents of the Corporation
shall be fixed by the Board of Directors or a committee thereof.
Section 5.5. The officers of the Corporation shall hold office until
their successors are chosen and qualify. Any officer elected or appointed by the
Board of Directors may be removed with or without cause at any time by the
affirmative vote of a majority of the Board of Directors then in office at any
regular or special meeting. Such removal shall be without prejudice to the
contract rights, if any, of the person so removed, provided, however, that the
election or appointment of an officer shall not, of itself, create contract
rights. Any vacancy occurring in any office of the Corporation shall be filled
by the Board of Directors.
Chairman of the Board
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Section 5.6. The Chairman of the Board, if any, shall preside at all
meetings of the Board of Directors of the Corporation. In the Chairman's
absence, such duties shall be attended to by the President. The Chairman may be
the chief executive officer of the Corporation if so designated.
The President
Section 5.7. The President shall be the Chief Executive Officer of the
Corporation; he or she shall preside at all meetings of the stockholders and of
the Board of Directors (unless the Corporation has a Chairman of the Board, who
will, in that case, preside at all meetings of the Board of Directors), shall
have general and active management of the business and affairs of the
Corporation and shall see that all orders and resolutions of the Board are
carried into effect. He or she shall perform such other duties and have such
other authority and powers as the Board of Directors may from time to time
prescribe. Within this authority and in the course of his or her duties the
President shall:
(a) Preside at all meetings of the stockholders and in the absence of
the Chairman of the Board, or, if there is none, at all meetings of the Board of
Directors, and shall be ex officio a member of all the standing committees,
including the Executive Committee, if any.
(b) Sign all certificates of stock of the Corporation, in conjunction
with the Secretary or Assistant Secretary, unless otherwise ordered by the Board
of Directors.
(c) When authorized by the Board of Directors or required by law,
execute, in the name of the Corporation, deeds conveyances, notices, leases,
checks, drafts, bills of exchange, warrants, promissory notes, bonds,
debentures, contracts, and other papers and instruments in writing, and unless
the Board of Directors orders otherwise by resolution, make such contracts as
the ordinary conduct of the Corporation's business requires.
(d) Subject to the approval of the Board of Directors, appoint and
remove, employ and discharge, and prescribe the duties and fix the compensation
of all agent, employees, and clerks of the Corporation other than the duly
appointed Officers, and, subject to the direction of the Board of Directors,
control all of the Officers, agents and employees of the Corporation.
Section 5.8. The Vice-Presidents, if any, in the order of their
seniority, unless otherwise determined by the Board of Directors, shall, in the
absence or disability of the President, perform the duties and have the
authority and exercise the powers of the President. They shall perform such
other duties and have such other authority and powers as the Board of Directors
may from time to time prescribe or as the President may from time to time
delegate.
Section 5.9. The Secretary shall attend all meetings of the Board of
Directors and all meetings of the stockholders and record all votes and minutes
of all proceedings in a book to be kept for that purpose, and shall perform like
duties for the Executive Committee when required. He or she shall give, or cause
to be given, notice of all meetings of the stockholders and special meetings of
the Board of Directors. He or she shall keep in safe custody the Seal of the
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Corporation and, when authorized by the Board of Directors or the Executive
Committee, affix the same to any instrument requiring it, and when so affixed,
it shall be attested by his signature or by the signature of the Treasurer or an
Assistant Secretary. He or she shall be under the supervision of the President.
He or she shall perform such other duties and have such other authority and
powers as the Board of Directors may from time to time prescribe or as the
President may from time to time delegate.
Section 5.10. The Assistant Secretaries, if any, in the absence or
disability of the Secretary, perform the duties and have the authority and
exercise the powers of the Secretary. They shall perform such other duties and
have such other powers as the Board of Directors may from time to time prescribe
or as the President may from time to time delegate.
Section 5.11. The Treasurer shall have the custody of the corporate
funds and securities and shall keep full and accurate accounts of receipts and
disbursements of the Corporation and shall deposit all monies and other valuable
effects in the name and to the credit of the Corporation in such depositories as
may be designated by the Board of Directors. He or she shall disburse the funds
of the Corporation as may be ordered by the Board of Directors, taking proper
vouchers for such disbursements, and shall render to the President and
Directors, at the regular meeting of the Board, or whenever they may request it,
an account of all his transactions as Treasurer and of the financial condition
of the Corporation. If required by the Board of Directors, he or she shall give
the Corporation a bond in such form, in such sum, and with such surety or
sureties as satisfactory to the Board of Directors, for the faithful performance
of the duties of his or her office. He or she shall perform such other duties
and have such other authority and powers as the Board of Directors may from time
to time prescribe or as the President may from time to time delegate.
Section 5.12. The Assistant Treasurer, if any, shall, in the absence of
the Treasurer or in the event of his or her inability or refusal to act, perform
the duties and exercise the powers of the Treasurer and shall perform such other
duties and have such other powers as the Board of Directors may from time to
time prescribe.
ARTICLE VI
Certificates for Shares
Section 6.1. The shares of the Corporation shall be represented by a
certificate. Certificates shall be signed by, or in the name of the Corporation
by, the Chairman of the Board of Directors, or the President or Vice President
and the Treasurer or an assistant treasurer, or the Secretary or an assistant
secretary of the Corporation.
Upon the face or back of each stock certificate issued to represent any
partly paid shares, or upon the books and records of the Corporation in the case
of uncertificated partly paid shares, shall be set forth the total amount of the
consideration to be paid therefor and the amount paid thereon shall be stated.
Certificates shall also contain such legends or statements as may be required by
law and any agreement between the Corporation and the holder thereof.
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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 lights of
each class of stock or series thereof and the qualification, limitations or
restrictions of such preferences and/or rights shall be set forth in full or
summarized on the face or back of the certificate which the Corporation shall
issue to represent such class or series of stock, provided that, except as
otherwise provided in the Act, in lieu of the foregoing requirements, there may
be set forth on the face or back of the certificate which the Corporation shall
issue to represent such class or series of stock, 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 and/or rights. Any security of
the Corporation, including, among others, any certificate evidencing shares of
the Common Shares and Preferred Shares or warrants to purchase Common Shares and
Preferred Shares of the Corporation, which is issued to any person without
registration under the Securities Act of 1933, as amended, or the Blue Sky laws
of any state, shall not be transferable until the Corporation has been furnished
with a legal opinion of counsel with reference thereto, satisfactory in form and
content to the Corporation and its counsel, to the effect that such sale,
transfer or pledge does not involve a violation of the Securities Act of 1933,
as amended, or the Blue Sky laws of any state having jurisdiction. The
certificate representing the security shall bear substantially the following
legend:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933 OR UNDER THE BLUE SKY LAWS OF ANY
STATE AND MAY NOT BE OFFERED, SOLD OR TRANSFERRED UNLESS SUCH OFFER, SALE OR
TRANSFER WILL NOT BE IN VIOLATION OF THE SECURITIES ACT OF 1933 OR ANY
APPLICABLE BLUE SKY LAWS. ANY OFFER, SALE OR TRANSFER OF THESE SECURITIES MAY
NOT BE MADE WITHOUT THE PRIOR WRITTEN APPROVAL OF THE CORPORATION OR ITS
COUNSEL. "
Section 6.2. The consideration for the issuance of shares shall consist
of any tangible or intangible property or benefit to the Corporation, including,
but not limited to, cash, promissory notes, services performed, contracts for
services to be performed or other securities of the corporation. Before the
Corporation issues shares, the Board of Directors must determine that the
consideration received or to be received for the shares to be issued is
adequate. The judgment of the Board of Directors as to the adequacy of the
consideration received for the shares issued is conclusive in the absence of
actual fraud in the transaction. When the Corporation receives the consideration
for which the Board of Directors authorized the issuance of shares, the shares
issued therefor are fully paid and nonassessable. The Corporation may place in
escrow shares issued for a contract for future services or benefits or a
promissory note, or make any other arrangements to restrict the transfer of the
shares. The Corporation may credit distributions made for the shares against
their purchase price, until the services are performed, the benefits are
received or the promissory note is paid. If the services are not performed, the
benefits are not received or the promissory note is not paid, the shares
escrowed or restricted and the distributions credited may be canceled in whole
or in part.
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Section 6.3. Unless otherwise provided in the subscription agreement,
subscriptions of shares, whether made before or after organization of the
Corporation, shall be paid in full at such time or in such installments and at
such times as shall be determined by the Board of Directors for payment on
subscriptions shall be uniform as to all shares of the same series. In case of
default in the payment on any installment or call when payment is due, the
Corporation may proceed to collect the amount due in the same manner as any debt
due to the Corporation.
Section 6.4. For any indebtedness of a Stockholder to the Corporation,
the Corporation shall have a first and prior lien on all preferred or common
shares owned by him and on all dividends or other distributions declared
thereon.
Section 6.5. Within a reasonable time after the issuance or transfer of
uncertificated 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 any requirements of the Act 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 and/or rights.
Section 6.6. Any or all the signatures on a certificate may be
facsimile. In case any officer, transfer agent or registrar who has signed or
whose facsimile signature has been placed upon a certificate shall have ceased
to be such officer, transfer agent or registrar before such certificate is
issued, it may be issued by the Corporation with the same effect as if he or she
were such officer, transfer agent or registrar at the date of issue.
Lost Certificates
Section 6.7. The Board of Directors may direct a new certificate or
certificates 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 uncertificated 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 or her legal representative, to advertise the same in such
manner as it shall require or 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.
Transfer of Stock
Section 6.8. 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 or the transfer agent of the Corporation to issue a
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new certificate to the person entitled thereto, cancel the old certificate and
record the transaction upon its books. Upon receipt of proper transfer
instructions from the registered owner of uncertificated shares, such
uncertificated shares shall be canceled and issuance of new equivalent
uncertificated shares or uncertificated shares shall be made to the person
entitled thereto and the transaction shall be recorded upon the books of the
corporation. Transfers of shares shall be made only on the books of the
Corporation by the registered holder thereof, or by his or her attorney
thereunto authorized by power of attorney and filed with the Secretary of the
Corporation or the transfer agent.
Section 6.9. Every stockholder or transferee shall furnish the
Secretary or a transfer agent with the address to which notice of meetings and
all other notices may be served upon or mailed to him or her, and in default
thereof, he or she shall not be entitled to service or mailing of any such
notice.
Fixing Record Date
Section 6.10. In order that the Corporation may determine the
stockholders entitled to notice of or to vote at any meeting of stockholders or
any adjournment thereof, or to express consent to corporate action in writing
without a meeting, or entitled to receive payment of any dividend or other
distribution or allotment of any rights, or entitled 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 fifty (50) nor less than ten (10) days before the
date of such meeting, nor more than fifty (50) days prior to any other action. A
determination of stockholders of record entitled to notice of or to vote at a
meeting of stockholders shall apply to any adjournment of the meeting; provided,
however, that the Board of Directors may fix a new record date for the adjourned
meeting.
Registered Stockholders
Section 6.11. The Corporation shall be entitled to recognize the
exclusive right of a person registered on its books as the owner of shares to
receive dividends, to vote as such owner, and to hold such person registered on
its books liable for calls and assessments as the owner of such shares, and
shall not be bound to recognize any equitable or other claim to or interest in
such share or shares on the part of any other person, whether or not it shall
have express or other notice thereof, except as otherwise provided by the laws
of Nevada.
ARTICLE VII
Miscellaneous/Dividends
Section 7.1. Dividends upon the capital stock of the Corporation,
subject to the provisions of the Articles of Incorporation, if any, and
applicable law, may be declared by the Board of Directors at any regular or
special meeting. Dividends may be paid in cash, in properly or in shares of
capital stock, subject to the provisions of the Articles of Incorporation.
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Section 7.2. Before payment of any dividend, there may be set aside out
of any funds of the Corporation available for dividends such sum or sums as the
Directors from time to time, in their absolute discretion, think proper as a
reserve or reserves to meet contingencies, or for equalizing dividends, or for
repairing or maintaining any property of the Corporation, or for such other
purpose as the Directors shall determine to be in the interest of the
Corporation, and the Directors may modify or abolish any such reserve in the
manner in which it was created.
Annual Statement
Section 7.4. Not later than one hundred fifty (150) days after the
close of each full fiscal year of the Corporation, the Directors shall mail a
report of the business and operation of the Corporation during such fiscal year
to the stockholders, which report shall constitute the accounting of the
Directors for such fiscal year. The report (herein the "Annual Report") shall be
in such form and have such content as the Directors deem proper. The Annual
Report shall include a balance sheet and a statement of income and surplus of
the Corporation. Such financial statement shall be accompanied by the report of
an independent certified public accountant thereon. A manually signed copy of
the accountant's report shall be filed with the Directors.
Checks
Section 7.5. All checks, demands, drafts, or other orders for payment
of money, notes or other evidences of indebtedness issued in the name of the
Corporation, shall be signed by such officer or officers or such other person or
persons as the Board of Directors may from time to time designate.
Contracts
Section 7.6. The Board of Directors may authorize any officer,
officers, agent, or agents, to enter into any contract or execute and deliver
any instrument in the name of and on behalf of the Corporation, and such
authority may be general or confined to specific instances.
Deposits
Section 7.7. All funds of the Corporation not otherwise employed shall
be deposited from time to time to the credit of the Corporation in such banks,
trust companies, or other depositories as the Board of Directors may select.
Fiscal Year
Section 7.8. The fiscal year of the Corporation shall be fixed by
resolution of the Board of Directors.
Seal
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Section 7.9. The corporate seal shall have inscribed thereon the name
of the Corporation, the year of its organization and the words "Corporate Seal,
Nevada." The seal may be used by causing it or a facsimile thereof to be
impressed or affixed or reproduced or otherwise.
Indemnification
Section 7.10. Unless otherwise provided in the Articles of
Incorporation, the Corporation shall indemnity its officers, agents and
Directors to the full extent permitted by the General Corporation Law of Nevada.
The protection and indemnification provided hereunder shall not be deemed
exclusive of any other rights to which such Director, agent or officer or former
Director or officer or such person may be entitled under any agreement,
insurance policy, vote of stockholders or otherwise.
ARTICLE VIII
Amendments
Section 8.1. Notwithstanding any other provision contained in these
Bylaws to the contrary, Sections 2.5, 2.11, 2.12 and 2.13 of Article II, Section
3.1 of Article III, and this Article VII of these Bylaws may be amended,
supplemented, or repealed only by the affirmative vote of two-thirds or more of
all of the shares of the Corporation entitled to vote generally in the election
of Directors, voting together as a single class. In addition to the foregoing,
the Board of Directors may amend or repeal these Bylaws or adopt new Bylaws.
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CERTIFICATE OF DECREASE IN
AUTHORIZED AND ISSUED SHARES
The following certificate is filed on behalf of VOXCOM HOLDINGS, INC.,
a Nevada corporation, pursuant to Section 78.207 of the Nevada Revised Statutes:
1. The number of shares of common stock, par value $0.0001 per share,
before the change in capitalization was 100,000,000.
2. The number of shares of common stock, par value $0.0001 per share,
after the change in capitalization, was 25,000,000. There is no change in par
value.
3. One share of new common stock, par value $000.01 per share, will be
issued for each four shares of old common stock, par value $0.0001 outstanding
before the change.
4. No fractional shares will be issued. Fractions of shares resulting
from the reverse split of the shares will be rounded to the nearest whole share.
Any fraction less than 0.5 shares will be cancelled.
5. Approval of the change by stockholders was not required nor
obtained.
6. The change is effective immediately.
VOXCOM HOLDINGS, INC.
By: /s/ Lawrence R. Biggs, Jr.
---------------------------------
Lawrence R. Biggs, Jr., President
By: /s/ Donald G. McLellan
---------------------------------
Donald G. McLellan, Secretary
STATE OF TEXAS )
)
COUNTY OF DALLAS )
This instrument was acknowledged before me on this 18thth day of June,
1997, by Lawrence R. Biggs, Jr.
/s/ Maurica Ferguson
-----------------------------
Notary Public, State of Texas
Maurica Ferguson
Printed Name of Notary
My Commission Expires: 3/11/99
VOXCOM HOLDINGS, INC.
Certificate of Designations, Preferences and
Rights of Preferred Stock
By Resolution of the Board of Directors
We, Lawrence R. Biggs, Jr., President, and Donald G. McLellan,
Secretary, of Voxcom Holdings, Inc., a corporation organized and existing under
the General Corporation Law of the State of Nevada, in accordance with the
provisions of Section 78.195 of the Nevada Revised Statutes thereof, DO HEREBY
CERTIFY:
That, pursuant to authority conferred upon the Board of Directors by
the Articles of Incorporation (or an amendment thereto) of said Corporation,
said Board of Directors, at a meeting duly held on December 23, 1997, adopted a
resolution providing for the issuance of a series of One Hundred Thousand
(100,000) shares of Series A Preferred Stock, which resolution is as follows:
RESOLVED, that pursuant to the authority vested in the Board
of Directors of this Corporation in accordance with the provisions of
its Articles of Incorporation, effective as of December 23, 1997 a
series of Preferred Stock of the Corporation be and it hereby is
created, such series of Preferred Stock to be designated Series A
Preferred Stock, to consist of up to 100,000 shares with a par value of
$0.0001 per share and to have rights of redemption and prices at which
shares of such series may be redeemed as set forth on Exhibit A to
these minutes.
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<PAGE>
IN WITNESS WHEREOF, said Voxcom Holdings, Inc. has caused its corporate
seal to be hereunto affixed and this certificate to be signed by Lawrence R.
Biggs, Jr., its Chairman, and Donald G. McLellan, its Secretary this 23rd day of
December, 1997.
By: /s/ Lawrence R. Biggs, Jr.
--------------------------------
Lawrence R. Biggs, Jr., Chairman
By: /s/ Donald G. McLellan
--------------------------------
Donald G. McLellan, Secretary
STATE OF TEXAS )
)
COUNTY OF DALLAS )
On December 23, 1997 personally appeared before me, a Notary Public,
Lawrence R. Biggs, Jr., Chairman, and Donald G. McLellan, Secretary, of Voxcom
Holdings, Inc., who acknowledged that they executed the above instrument on
behalf of said corporation.
/s/ Maurica Ferguson
-----------------------------
Notary Public, State of Texas
(Seal)
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<PAGE>
EXHIBIT A
SERIES A PREFERRED STOCK
1. Voxcom Holdings, Inc. (the "Company") establishes a series of
Preferred Stock pursuant to the authority contained in the Articles of
Incorporation of the Company, to be known as Series A Preferred Stock, par value
$0.0001 per share.
2. There shall be authorized the issuance of up to 100,000 shares of
Series A Preferred Stock.
3. The issue price of Series A Preferred Stock shall be $100.00 per
share (the "Issue Price"), issuable in exchange for conversion of indebtedness
of like amount. No dividends shall be payable on this Series A Preferred Stock.
4. In the event of any dissolution, liquidation or winding up of the
Company, whether voluntarily or involuntarily, the holders of Series A Preferred
Stock, without any preference among them, shall be entitled to receive in cash
out of the assets of the Company, whether capital or surplus or otherwise,
before any distribution of the assets shall be made to the holders of Common
Stock, an amount equal to the aggregate Issue Price of their shares. After
payment to the holders of the Series A Preferred Stock of the full preferential
amounts hereinbefore provided for, the holders of Series A Preferred Stock will
have no other rights or claims to any of the remaining assets of the Company,
either upon distribution of such assets or upon dissolution, liquidation or
winding up. The sale of all or substantially all of the property of the Company
to, or the merger, consolidation or reorganization of the Company into or with,
any other company, or the purchase or redemption by the Company of any shares of
any class of its Preferred Stock or its Common Stock or any other class of its
stock shall not be deemed to be a distribution of assets or a dissolution,
liquidation or winding up for the purposes of this paragraph.
5. The Company may, at its option, redeem the whole or any part of the
shares of Series A Preferred Stock, and the redemption price thereof shall be
equal to the Issue Price of the shares so redeemed. All such redemptions of
Series A Preferred Stock shall be effected in accordance with any procedure for
redemptions set forth in the General Corporation Law of the State of Nevada.
Shares of Series A Preferred Stock which are redeemed shall be restored to the
status of authorized but unissued shares.
On or before the date fixed for redemption, the Company, if it elects
to call such shares for redemption, shall provide for payment of a sum
sufficient to redeem the shares called for redemption either (1) by setting
aside the sum, separate from its other funds, in trust for the benefit of the
holders of the shares to be redeemed, or (2) by depositing such sum in a bank or
trust company as a trust fund, with irrevocable instructions and authority to
the bank or trust company to give or complete the notice of redemption and to
pay, on or after the date fixed for redemption, the redemption price on
surrender of certificates evidencing the shares of Series A
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<PAGE>
Preferred Stock called for redemption. From and after the date fixed for
redemption, (a) the shares shall be deemed to be redeemed, (b) dividends thereon
shall cease to accumulate, (c) such setting aside or deposit shall be deemed to
constitute full payment of the shares, (d) the shares shall no longer be deemed
to be outstanding, (e) the holders thereof shall cease to be shareholders with
respect to such shares, and (f) the holders thereof shall have no rights with
respect thereto, except the right to receive their proportionate shares of the
fund set aside pursuant hereto or deposited upon surrender of their respective
certificates. Any interest accrued on funds set aside pursuant hereto or
deposited shall belong to the Company. If the holders of shares do not, within
six (6) years after such deposit, claim any amount so deposited for redemption
thereof, the bank or trust company shall upon demand pay over to the Company the
balance of the funds so deposited, and the bank or trust company shall thereupon
be relieved of all responsibility to such holders.
6. Holders of the Series A Preferred Stock shall have no right to cause
redemption of the Series B Preferred Stock by the Company.
7. Holders of Series A Preferred Stock shall have no right to vote on
any matters to come before a vote of the shareholders, except as provided below.
8. The holders of shares of any and all series of Series A Preferred
Stock outstanding on the record date for any such meeting of the shareholders
shall be entitled to vote, as a single class, upon any proposed amendment to the
Company's Articles of Incorporation, and their consent shall be required for any
action of the Board of Directors, if such amendment or action would (i) increase
or decrease the aggregate number of authorized shares of Series A Preferred
Stock, (ii) increase or decrease the Issue Price of shares of Series A Preferred
Stock, (iii) effect an exchange, reclassification or cancellation of all or part
of the shares of Series A Preferred Stock, (iv) effect an exchange, or create a
right of exchange, of all or any part of the shares of another class into shares
of Series A Preferred Stock, (v) change the designations, preferences,
limitations, or relative rights of any series of Series A Preferred Stock at the
time outstanding in those respects in which the shares thereof vary from shares
of other series or Series A Preferred Stock at the time outstanding, (vi) change
the shares of Series A Preferred Stock into the same or a different number of
shares, either with or without par value, of the same class or another class or
classes, or (vii) cancel or otherwise affect accumulated but undeclared
dividends on the shares of Series A Preferred Stock, and no such proposed
amendment or action shall be deemed to have been adopted and approved without
the affirmative vote or consent of holders of a majority of shares of Series A
Preferred Stock then outstanding.
9. Shares of Series A Preferred Stock shall not be convertible into any
other security of the Company.
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CONSULTING AGREEMENT AND COVENANT NOT TO COMPETE
THIS AGREEMENT is made effective as of this this first day of July,
1997 by and between VOXCOM HOLDINGS, INC., a Nevada corporation (the "Company"),
and KIM CROWTHER and BRIAN JENSEN (together referred to herein as the
Consultants).
WHEREAS, Company desires to retain Consultants for a period of five
years to assist the Company in the development of a series of lecture companies
and to protect itself against the adverse consequences of competition by the
Consultants against the Company; and
WHEREAS, the Company and Consultants have enjoyed a mutually rewarding
business relationship since May 1996 in their joint ownership of The Home
Business Group, Inc. ("HBG") and wish to continue such relationship in a similar
manner as described in this Agreement;
NOW, THEREFORE, in consideration of the premises and the agreements
contained herein, the Company and Consultants hereby agree as follows:
1. Consulting Services.
1.1 For a period of 60-months beginning July 1, 1997, the
Company hereby retains Consultants and Consultants hereby agree to
perform consulting services for the Company pursuant to the terms of
this Agreement. Such services shall specifically include the following
activities:
a. Creation of a minimum of three companies to engage
in business as lecture companies (the "Lecture Companies")
that instruct participants in sponsored seminars about the
conduct of home based and other small businesses similar to
the operations now being conducted by HBG.
b. At the mutual election of Consultants and the
Company, consolidate the operations of HBG as a wholly owned
subsidiary of the Company in order to function as one of the
three (or more) Lecture Companies being created hereby.
c. Be jointly responsible for the day to day
management of the Lecture Companies in a manner consistent
with their duties at HBG, and carry out the directives of the
Boards of Directors of the Company and the Lecture Companies.
d. Cause the Lecture Companies to promote the goods
and services of AmeraPress, Inc., another wholly owned
subsidiary of the Company, in connection
- 1 -
<PAGE>
with the Lecture Companies' seminars and marketing materials.
This promotion will include a most-favorable presentation
placement and lead access by AmeraPress, Inc.
at lectures and seminars of the Lecture Companies.
1.2 Consultants shall at all times be free to devote time to
occupations, employment and activities other than those provided for in
this Agreement, provided they do not conflict with, detract from, or
compete with the duties of the Consultants under this Agreement.
1.3. Each Lecture Company shall include in its Bylaws and
Articles of Incorporation indemnification provisions in the form
attached hereto as Schedule B, which are identical to those contained
in comparable documents of the Company.
2. Consideration. Company will pay to Consultants for the agreement of
Consultants to perform consulting services in accordance with this Agreement,
as follows:
2.1 Company will grant to Consultants upon execution of this
Agreement a total of 200,000 shares of the Company's common stock, to
be divided between Consultants in such manner as they may agree.
2.2. Each Lecture Company will pay to the Consultants 4% of
the gross proceeds of sales by the Lecture Companies at seminars
sponsored by the Lecture Companies, and in telemarketing, direct
marketing and other sales resulting from the seminars and caused by the
efforts of the Consultants.
2.3. Each Lecture Company will pay to the Consultants, on a
quarterly basis, in cash, total commissions (to be divided between the
Consultants in such manner as they may agree) equal to 25% of the net
profit of the Lecture Companies on a combined basis. In computing net
profit, a deduction will be made to cover (i) their share of federal
income tax equal to 38% of the amount of net profit before such taxes,
and (ii) such companies' debt service obligations.
2.4. The Company will also grant to the Consultants (to be
divided between them in such manner as they may agree) shares of the
Company's common stock in accordance with the formula described on
attached Exhibit A.
2.5. The Company will review the performance of other key
employees of the Lecture Companies to determine the possibility of
grants in common stock to such persons.
2.6. Consultants hereby represent to the Company as follows
with regard to the acquisition of shares of the Company's common stock:
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<PAGE>
(a) Consultants are acquiring the shares of Company
common stock being granted hereby (the "Company Shares") for
their own accounts, not as nominee or agent, for investment
and not with a view to, or for resale in connection with, any
distribution in violation of the Act, or any state securities
laws, and it has no present intention of, or agreement
relating to, selling, granting participations in or otherwise
distributing such Company Shares in violation of such laws.
(b) Consultants understand that (i) the Company
Shares have not been registered under the Act or any state
securities laws by reason of specific exemptions therefrom,
that the Company Shares may be sold, transferred or otherwise
disposed of only if such disposition is registered under the
Act and applicable state securities laws or is exempt from
such registration, and that they must therefore bear the
economic risk of such investment indefinitely, unless a
subsequent disposition thereof is registered under the Act and
applicable state securities laws or is exempt from such
registration; and (ii) each certificate representing the
Company Shares will be endorsed with a legend substantially in
the following form:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE, AND
MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED
UNLESS AND UNTIL EITHER SUCH SHARES ARE REGISTERED
UNDER THE APPLICABLE FEDERAL AND STATE SECURITIES
LAWS OR AN OPINION OF COUNSEL SATISFACTORY TO THE
COMPANY IS OBTAINED TO THE EFFECT THAT SUCH
REGISTRATION IS NOT REQUIRED."
(c) Each Consultant is a knowledgeable and
experienced investor and has had an opportunity to ask
questions and review information about the business and
financial condition of the Company. Each Seller acknowledges
receipt of an information package of the Company and such
other information as has been requested.
3. Additional Agreements.
3.1 The Company will agree to vote the common stock owned by
it in each Lecture Company to elect a three person board of directors
of each such company that is composed of any two of Larry Cahill,
Lawrence R. Biggs, Jr., or Donald G. McLellan and one person named by
the Consultants. The Consultant not a member of the board of directors
of each Lecture Company shall nevertheless be entitled to attend
meetings of the board on a nonvoting basis. In the event that no two of
Messrs. Cahill, Biggs or McLellan are available for service on the
board, the Consultants shall have the right to terminate this
Agreement.
- 3 -
<PAGE>
3.2 The Company agrees to advance funds to the Lecture
Companies for their working capital needs to staff and conduct lectures
in advance of receiving profits therefrom. Such advances shall be
repaid, plus interest at the annual rate of 6%, from the profits of the
Lecture Companies.
4. Covenant Not to Compete.
4.1 Consultants agree that, during the five year term of the
Consulting Agreement and for two years thereafter, Consultants shall
not, without the prior written consent of the Company, directly, or
indirectly by being an officer, director, employee, or an owner of more
than five percent (5%) of the outstanding capital stock of any
corporation or an owner of any interest in, or employee of, any other
form of business association, sole proprietorship or partnership,
conduct a business in competition with the Company or the Lecture
Companies as it was conducted during the term of this Agreement, from
any business location with the States of Texas, Nevada or Utah. The
Company agrees that the publication by Crowther of a book entitled
Starting a Successful Home Based Business shall not be deemed
competitive, nor shall the Company obtain any rights to or through such
book.
4.2 Consultants agree that during the five year term of the
Consulting Agreement and for two years thereafter, Consultants shall
not, directly, or indirectly by being an officer, director, employee,
or an owner of more than five percent (5%) of the outstanding capital
stock of any corporation, or an owner of any interest in, or employee
of, any other form of business association, sole proprietorship or
partnership, solicit or otherwise attempt to induce any employees,
agents or representatives of Company to terminate their position as
employee, agent or representative with Company.
4.3 Consultants agree that during the five year term of the
Consulting Agreement and for two years thereafter, Consultants shall
not, directly, or indirectly by being an officer, director, employee or
an owner of more than five percent (5%) of the outstanding capital
stock of any corporation or an owner of any interest in, or employee
of, any other form of business association, sole proprietorship or
partnership, solicit or otherwise attempt to induce any entities or
persons who have been customers of either Consultant or the Company at
any time during the five year term of this Section to become customers
of someone other than the Company that is in competition with the
Company or the Lecture Companies.
4.4 Consultants agree that all order forms, service contracts,
literature, manuals, catalogs, lists of customers, price lists,
brochures, books, records, correspondence, and other materials relating
to the Lecture Companies shall be the property of the Lecture Companies
and the Company.
- 4 -
<PAGE>
4.5 The Company agrees that, during the five year term of the
Consulting Agreement and for two years thereafter, the Company shall
not, without the prior written consent of the Consultants, directly, or
indirectly by being an officer, director, employee, or an owner of more
than five percent (5%) of the outstanding capital stock of any
corporation or an owner of any interest in, or employee of, any other
form of business association, sole proprietorship or partnership,
conduct a business in competition with the Lecture Companies as it was
conducted during the term of this Agreement, from any business location
with the States of Texas, Nevada or Utah, unless it shall have first
proposed the formation of such an enterprise to be included as a
Lecture Company subject to this Agreement, and Consultants shall have
declined to participate in such enterprise.
4.6 In the event that any court shall finally hold that any
provisions stated in this Section 4 constitutes an unreasonable
restriction upon Consultants, the parties hereby expressly agree that
the provisions of this Section 4 shall not be rendered void, but shall
apply as to time and territory or to such other extent as such court
may judicially indicate constitutes a reasonable restriction under the
circumstances involved. In the event such court shall hold as
aforesaid, but fail to indicate an alternative restriction of time or
territory, then the parties hereby expressly agree to submit this
matter to arbitration with the American Arbitration Association, for
the purposes of determining a reasonable restriction under the
circumstances involved.
4.7 Notwithstanding the foregoing, Section 4.1 of this
Agreement may be canceled at the option of the Consultants in the
events (i) any two of Larry Cahill, Lawrence R. Biggs, Jr. or Donald G.
McLellan cease to be substantially involved in the management of the
Company, or (ii) Consultants shall not have received aggregate value
from the items listed in Sections 2.1, 2.2, 2.3, and 2.4 during the
five year term of this Agreement in excess of $2 million each.
5. Termination.
5.1 Subject to the provisions of Section 5.2, this Agreement
shall terminate as to either Consultant:
a. Upon the death of a Consultant.
b. Upon the mutual agreement of Company and
Consultant.
c. At the Company's option for good cause. For
purposes of this Section, "good cause" for termination shall
consist of: (a) the failure of a Consultant to diligently or
effectively perform his duties under this Agreement, (b) the
commission by Consultant of any act involving moral turpitude
or the commission by Consultant of any act or the suffering by
Consultant of any
- 5 -
<PAGE>
occurrence or state of facts, which renders Consultant
incapable of performing his duties under this Agreement, or
adversely affects or could reasonably be expected to adversely
affect the Company's business reputation, (c) any breach by a
Consultant of any of the terms of, or the failure to perform
any covenant contained in, this Agreement, (d) the violation
by a Consultant of instructions or policies established by the
Company with respect to the operation of its business and
affairs or a Consultant's failure to carry out the reasonable
instructions of the Chairman or President of the Company, or
(e) the commission by a Consultant of any action or the
existence of any state of facts which would legally justify
the Company in terminating a contract of employment.
d. At the option of the Consultants if the price per
share of the Company's common stock does not equal or exceed
$10.00 per share at any time during the year ending June 30,
1998.
5.2 Upon termination for any reason, all consideration
payments under Section 2 shall be prorated and paid to the date of
termination, and all other forms of benefits shall cease effective with
such date, subject to any vesting of benefits that extend beyond
termination by their terms. No termination under this Section 5 shall
affect the rights and obligations of the parties under Section 4.
6. General.
6.1 This Agreement supersedes all prior agreements and
understandings between the Consultants and the Company with regard to
the subject matter of this Agreement.
6.2 No modification, termination, or waiver under this
Agreement shall be valid unless in writing and signed by the
Consultants and the Company.
6.3 This Agreement shall inure to the benefit of and be
binding upon any successor or assign of the Company and shall inure to
the benefit of and be binding upon the Consultants' heirs, successors
and assigns.
6.4 The waiver by the Company of a breach of any provision of
this Agreement by any Consultants shall not operate or be construed as
a waiver of any subsequent breach of such Consultants and the waiver by
a Consultants of a breach of any provision of this Agreement by the
Company shall not operate or be construed as a waiver of any subsequent
breach by the Company.
6.5 This Agreement shall be interpreted and construed under
the laws of the State of Texas.
- 6 -
<PAGE>
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
VOXCOM HOLDINGS, INC.
By: /s/ Lawrence R. Biggs, Jr.
-------------------------------------
Lawrence R. Biggs, Jr., President
/s/ Kim Crowther
-------------------------------------
KIM CROWTHER
/s/ Brian Jensen
-------------------------------------
BRIAN JENSEN
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<PAGE>
SCHEDULE A TO CONSULTING AGREEMENT
AND COVENANT NOT TO COMPETE
YEAR 1 - JULY 1, 1997 - JUNE 30, 1998
The Company will issue a total number of shares equal to the net profit of the
Lecture Companies on a combined basis, less: (i) a provision for federal income
tax equal to 38% of such profit, (ii) debt service obligations of the Lecture
Companies, and (iii) the cash commissions paid to the Consultants pursuant to
Section 2.2, multiplied by the average price to earnings ratio of the Company's
common stock in the over-the-counter market over the 90 days prior to June 30,
1998, multiplied by 25%, divided by the average over the 20 trading days
preceding June 30, 1998 of the mean bid and ask price of the Company's common
stock in the over-the-counter market.
YEARS 2 THROUGH 5, ENDING JUNE 30, 1999, 2000, 2001, AND 2002
In each succeeding year, shares of common stock will be granted based on the
same formula in effect during the year ended June 30, 1998, except that instead
of using net profit (as adjusted) as the starting number, substitute the growth
in net profit over the previous year and apply the same adjustments.
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<PAGE>
SCHEDULE B
INDEMNIFICATION PROVISIONS
Bylaws Provision
Indemnification
Section _____. Unless otherwise provided in the Articles of
Incorporation, the Corporation shall indemnity its officers, agents and
Directors to the full extent permitted by the General Corporation Law of Nevada.
The protection and indemnification provided hereunder shall not be deemed
exclusive of any other rights to which such Director, agent or officer or former
Director or officer or such person may be entitled under any agreement,
insurance policy, vote of stockholders or otherwise.
Articles of Incorporation Provision
ARTICLE _____
Section 1. Limitation of Personal Liability. The personal liability of the
directors of the corporation is hereby eliminated to the fullest extent
permitted by the General Corporation Law of the State of Nevada, as the same may
be amended and supplemented.
Section 2. Indemnification. The corporation shall, to the fullest extent
permitted by the General Corporation Law of the State of Nevada, as the same may
be amended and supplemented, indemnify the directors and officers of the
corporation from and against any and all of the expenses, liabilities, or other
matters referred to in or covered by said Law, and the indemnification provided
- 9 -
<PAGE>
for herein shall not be deemed exclusive of any other rights to which those
indemnified may be entitled under any Bylaw, agreement, vote of stockholders or
disinterested directors or otherwise, both as to action in his official capacity
while holding such office, and shall continue as to a person who has ceased to
be a director or officer and shall inure to the benefit of the heirs, executors,
and administrators of such person.
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VOXCOM HOLDINGS, INC.
1997 STOCK BONUS PLAN
ARTICLE I
GENERAL
1.1 Purpose of the Plan.
The purpose of the Voxcom Holdings, Inc. 1997 Stock Bonus Plan (the "Plan") is
to assist Voxcom Holdings, Inc., a Nevada corporation (the "Company") in
securing and retaining key persons of outstanding ability to serve the Company
as key professional and consulting personnel by making it possible to offer them
shares of registered common stock in lieu of fees in order to conserve the
Company's cash and thereby increase their efforts for the Company's welfare
through participation or increased participation in the ownership and growth of
the Company.
1.2 Definitions.
(a) "Award" means a grant of shares to a Participant under
the Plan.
(b) "Board of Directors" or "Board" means the Board of
Directors of the Company.
(c) "Code" means the Internal Revenue Code of 1986, as
amended.
(d) "Common Stock" means the Common Stock of the Company.
(e) "Grantee" means a Participant to whom an Award is granted
under the Plan.
(f) "Participant" means any person, including consultants and
directors, who is designated a Participant and is or is expected to be
instrumental in promoting the business of the Company.
(g) "Term" means the period during which a particular option
may be exercised as determined by the Committee and as provided in the
option agreement.
- 1 -
<PAGE>
1.3 Administration of the Plan.
The Plan shall be administered by the Board of Directors. The Board
shall have the power to interpret and apply the Plan and to make
regulations for carrying out its purpose. More particularly, the Board
shall determine which Participants shall be granted shares and the
terms of such grants. Determinations by the Board under the Plan
(including, without limitation, determinations of the person to receive
Awards, the form, amount and timing of such Awards, and the terms and
provisions of such Awards and the agreements evidencing same) need not
be uniform and may be made by it selectively among persons who receive,
or are eligible to receive, Awards under the Plan, whether or not such
persons are similarly situated.
1.4 Shares Subject to the Plan.
The total number of shares that may be issued to Consultants under the
Plan shall not exceed 750,000 shares of Common Stock. Shares issued
pursuant to the Plan may be either unissued shares of Common Stock or
reacquired shares of Common Stock held in treasury.
1.5 Terms and Conditions of Awards.
All Awards shall be evidenced by agreements in such form as the Board
of Directors shall approve from time to time subject to the provisions
of Article II and Article III, as appropriate, and the following
provisions:
(a) Grant Price. The grant price of Common Stock shall be the
par value of the Common Stock on the date of grant, which the Board of
Directors has established as the fair market value of the shares on
such date..
(b) Grantee. Awards of Common Stock may be made only to
individuals or one-person service corporations who render bona fide
legal, professional or consulting services to the Company. No Awards
may be made as compensation for any efforts of such persons to raise
capital for the Company.
(c) Regulation. The Common Stock subject to the Plan shall be
registered with the Securities and Exchange Commission under a Form S-8
registration statement.
(d) Taxation. Shares of Common Stock issued under the Plan
will be taxable to the Grantees in the amount of their fair market
value, and the Company will provide each Grantee with a Form 1099 to
report such issuance.
- 2 -
<PAGE>
(e) Additional Provisions. Each award agreement may contain
such other terms and conditions not inconsistent with the provisions of
the Plan, including the payment of cash amounts, as the Board of
Directors may deem appropriate from time to time.
1.6 Compliance with Rule 16b-3.
It is intended that the provisions of the Plan and any Award shall
comply in all respects with the terms and conditions of Rule 16b-3
under the Securities Exchange Act of 1934, as in effect on July 1, 1997
and as amended, or any successor provisions, as it relates to persons
subject to the reporting requirements of Section 16(a) of such Act. To
the extent that any provision hereof is found not to be in compliance
with such rule as it relates to such Act, such provision shall be
deemed to be modified so as to be in compliance with such rule, or if
such modification is not possible, shall be deemed to be null and void,
as it relates to such Grantee.
ARTICLE II
ADDITIONAL PROVISIONS
2.1 Board Approval.
The Plan has been approved by the unanimous consent of the Board of
Directors of the Company.
2.2 Compliance with Other Laws and Regulations.
The Plan and the obligation of the Company to sell and deliver shares
under the Plan, shall be subject to all applicable Federal and state
laws, rules, and regulations and to such approvals by any government or
regulatory agency as may be required. The Company shall not be required
to issue or deliver any certificates for shares of Common Stock prior
to (a) the listing of such shares on any stock exchange on which the
Common Stock may then be listed and (b) the completion of any
registration or qualification or exemption of such shares under any
Federal or state law, or any ruling or regulation of any government
body which the Company shall, in its sole discretion, determine to be
necessary or advisable.
- 3 -
<PAGE>
2.3 Amendments.
The Board of Directors may discontinue the Plan at any time, and may
amend it from time to time. Other than as expressly permitted under the
Plan, no outstanding Award may be revoked or altered in a manner
unfavorable to the Grantee without the consent of the Grantee.
2.4 Withholding.
Whenever the Company proposes or is required to issue or transfer
shares of Common Stock under the Plan, the Company shall have the right
to require the Grantee to remit to the Company an amount sufficient to
satisfy any Federal, state or local withholding tax liability in such
form as the Company may determine or accept in its sole discretion,
including payment by surrender or retention of shares of Common Stock
prior to the delivery of any certificate or certificates for such
shares.
2.5 Effective Date; Duration.
The Plan shall become effective as of August 15, 1997 pursuant to Board
of Director approval received effective such date and shall expire on
September 30, 1997.
ARTICLE IV
AWARDS
Subject to all of the terms and provisions of the Plan, the Board has
granted Awards to the following persons in the following amounts:
Name Shares Purchase Price
Rick Graf 150,000 $15.00
Gwynda Gee 12,500 1.25
Miah Dover 12,500 1.25
Ronald L. Brown 50,000 5.00
Kim Crowther 100,000 10.00
Brian Jensen 100,000 10.00
Herbert Sievers 150,000 15.00
- 4 -
PURCHASE MONEY
SECURITY AGREEMENT
VOXCOM SALES, LLC, d/b/a AMERAPRESS, INC., 203 S. ECTOR, EULESS, TX
76040 (hereinafter called "Debtor") a corporation, hereby grants to General
Binding Corporation (hereinafter called "GBC") a purchase money security
interest in the following goods described as:
Equipment: GBC VULCAN II SYSTEM (Versa Feeder; Vulcan II
Laminator and Vulcan II Cutter)
Serial # 97V2012cas
together with all equipment, parts, accessories, attachments and replacements
thereof and additions thereto, whether now owned or hereafter acquired by
Debtor, and the proceeds thereof (hereinafter collectively called "Collateral"),
to secure (1) payment of a note dated 3/27/97 executed and delivered by Debtor
to GBC in the sum of ($76,711 (SEVENTY SIX THOUSAND, SEVEN HUNDRED AND ELEVEN
DOLLARS, U.S.) payable as to principal and interest as therein provided (the
"Note"); (2) further advances which may be made by GBC to Debtor; (3) all other
liabilities (primary, secondary, direct, contingent, sole, joint or several) due
or to become due to GBC and (4) performance by Debtor of the agreements
hereinafter set forth.
DEBTOR REPRESENTS, WARRANTS AND AGREES AS FOLLOWS:
1. The Collateral will be used by Debtor primarily in the business of
the Debtor.
2. Debtor agrees to pay GBC: (a) the sums evidenced by the promissory
note executed pursuant to this agreement in accordance with the terms of the
agreement and of the Note; (b) all sums, including reasonable attorney's fees
and legal expenses, paid or incurred by GBC in pursuing any of its rights and
remedies or in remedying any default pursuant to this agreement, together with
interest thereon at the rate stipulated in the note or notes from the date the
same shall have been paid; and (c) at GBC's option, the entire unpaid
indebtedness to GBC, whether created or incurred pursuant to this agreement or
otherwise, upon Debtor's default or if GBC reasonably deems itself insecure.
3. Debtor will not move the Collateral from the address of Debtor set
forth above without the express written consent of GBC.
4. Debtor is the owner of the Collateral free and clear of all liens
and security interests. Debtor will defend the Collateral against the claims and
demands of all persons.
5. Debtor will pay GBC all amounts secured hereby as and when the same
shall be due and payable, whether at maturity, by acceleration or otherwise, or
when GBC deems itself insecure for any reason, and will perform all terms of
this or any other security or loan agreement between Debtor and GBC, and will
discharge all said liabilities.
<PAGE>
6. Debtor will at all times keep the Collateral insured against all
insurable hazards in amounts equal to the full cash value of the Collateral.
Such insurance shall be in such companies as may be acceptable to GBC, with
provisions satisfactory to GBC for payment of all losses thereunder to GBC as
its interest may appear, and if required, to deposit the policies with GBC. Any
money received by GCS under said policies may be applied to the payment of any
indebtedness secured hereby, whether or not due and payable, or at GBC's option
may be delivered by GBC to Debtor for the purpose of repairing or restoring the
Collateral. Debtor assigns to GBC all right to receive proceeds of insurance not
exceeding the amounts secured hereby, directs any insurer to pay all proceeds
directly to GBC, and GBC is appointed Debtor's Attorney in Fact to endorse any
draft or check made payable to Debtor in order to collect the benefits of such
insurance. If Debtor fails to keep the Collateral insured as required by GBC,
GBC shall have the right to obtain such insurance at Debtor's expense and add
the cost thereof to the other amounts secured hereby.
7. Debtor will keep the collateral in good condition and repair and
will pay and discharge all taxes, levies and other impositions levied thereon as
well as the costs of repairs to or maintenance of same, and will not permit
anything to be done that may impair the value of any of the Collateral. If
Debtor fails to pay such sums, GBC may do so for Debtor's account and add the
amount thereof to the other amounts secured hereby.
8. GBC is authorized to do all things which it deems necessary to
perfect and continue perfecting the security interest created hereby and to
protect the Collateral.
9. Debtor will not sell, exchange, lease or otherwise dispose of any of
the Collateral without the prior written consent of GBC; permit any liens or
security interest to attach to any of the Collateral except that created by this
agreement; permit any of the Collateral to be levied upon under any legal
process; or permit anything to be done that may impair the security intended to
be afforded by this agreement. The inclusion of proceeds in this agreement does
not authorize Debtor to sell, dispose of or otherwise use the Collateral in any
manner not specifically authorized by the agreement.
10. Debtor shall be in default under this agreement: (a) when it has
made any misstatement in connection with or has failed to pay or perform any of
its obligations, agreements or affirmations under this or any other security
agreement with GBC; (b) when any event occurs which results in acceleration of
the maturity of the indebtedness of Debtor under any agreement with any person;
(c) upon the dissolution, termination of existence or business failure of
Debtor, or the appointment of a receiver for any part of the property of,
assignment for the benefit of creditors by, or the commencement of any
proceeding in bankruptcy or insolvency by or against, Debtor or any surety for
Debtor; or (d) when GBC in good faith deems itself insecure and its prospect of
payment impaired.
Until default in any of the items hereof, or the terms of any
indebtedness secured hereby, or until GBC deems itself insecure, Debtor shall be
entitled to possession of the Collateral and to use the same in any lawful
manner, provided that such use does not cause excessive wear and tear to the
Collateral, cause it to decline in value at any excessive rate, or violate the
terms of any policy of insurance thereon.
<PAGE>
UPON DEFAULT, all sums secured hereby shall immediately become due and
payable at GBC's option without notice to Debtor, and GBC may proceed to enforce
payment of same and to exercise any or all rights and remedies provided by the
Uniform Commercial Code of TEXAS or other applicable law, as well as all other
rights and remedies possessed by GBC all of which shall be cumulative. Whenever
Debtor is in default hereunder, and upon demand by GBC, Debtor shall assemble
the Collateral and make it available to GBC at a place reasonably convenient to
GBC and Debtor. Any notice of sale, lease or other intended disposition of the
Collateral by GBC sent to Debtor at the address specified above, or at such
other address of Debtor as may be shown on records, at least five (5) days prior
to such action, shall constitute reasonable notice to Debtor.
GBC warranties the equipment for one (1) year on all non-wear parts and
labor, GBC warrants that any upgrades to the system that become available and
are necessary for performance of the equipment will be installed during the
twelve (12) month warranty period.
GBC may waive any fault before or after the same has been declared
without impairing its right to declare a subsequent default hereunder, this
right being a continuing one.
If any provision of this agreement is held invalid, such invalidity
shall not affect the validity or enforceability of the remaining provisions of
this agreement.
This agreement shall be governed by and interpreted under the laws of
TEXAS.
This agreement shall inure to the benefit of GBC's successors and
assigns and shall bind Debtor's heirs, representatives, successors and assigns.
IN WITNESS WHEREOF this agreement has been executed this 27th day of
March, 1997.
GENERAL BINDING CORPORATION VOXCOM SALES LLC
d/b/a AMERAPRESS, INC.
By:/s/ Robert O'Connor By:/s/ Don McLellan
--------------------------------------- ------------------------
Robert O'Connor,
General Manager - GBC Film Products
Attest:/s/ Maurica Ferguson
By:/s/ Jim Barnes --------------------
---------------------------------------
Jim Barnes, Controller
<PAGE>
Indebtedness Amount: $76,711
Date: 27th March 1997
PROMISSORY NOTE
FOR VALUE RECEIVED, the undersigned promises to pay to the order to GENERAL
BINDING CORPORATION ("GBC"), a Delaware corporation, or assigns the principal
sum of $76,711 (SEVENTY SIX THOUSAND, SEVEN HUNDRED AND ELEVEN DOLLARS, U.S.) in
accordance with, and pursuant to the terms set forth on Exhibit A attached
hereto and made a party hereof.
1. This Note is secured by a security agreement bearing even date (the
"Security Agreement") herewith covering certain equipment purchased from GBC by
the undersigned.
2. In the event of default in payment of installments when due or
non-payment or principal and interest at maturity or in the event of the
undersigned's failure to perform any other covenant, term or condition contained
in this Note or on Exhibit A attached hereto, or the Security Agreement, GBC may
at its option without notice or demand declare the entire principal plus accrued
interest, together with any advances to be immediately due and payable. Any such
amounts then due shall bear interest at a default rate of 12 percent per annum,
from the time of such default without further notice. The undersigned shall also
pay to GBC any costs and expenses, including reasonable attorney's fees,
incurred by GBC in the enforcement or this Note.
3. The undersigned may, at any time, and from time to time, without the
payment of penalty or premium, prepay the principal indebtedness of this Note in
whole or in part.
4. No delay on the part of GBC in the exercise of any right or remedy
shall operate as a waiver thereof, no single or partial exercise thereof or the
exercise of any other right or remedy, nor shall a waiver on one occasion be
construed as a bar to, or waiver of any right on any future occasion.
5. This Note shall inure to an be binding upon the respective heirs,
executors, administrators, successors, and assigns of the parties hereto.
<PAGE>
6. This Note shall be governed by, and interpreted in accordance with,
the laws of the TEXAS.
7. Each of the undersigned hereby severally waives demand, presentment,
notice of dishonor and protest of this Note.
8. This Note shall be payable as set forth in Exhibit A or at such
other address as GBC shall designate in writing.
VOXCOM SALES, LLC d/b/a AMERAPRESS, INC.
By:/s/
---------------------------------
President
Attest:/s/
-----------------------------
Secretary
<PAGE>
EXHIBIT A
This Exhibit A is incorporated into and specifically made a part of a
Promissory Note dated 27th March 1997 (the "Note") from VOXCOM SALES, LLC d/b/a
AMERAPRESS, INC.
("Debtor") to General Binding Corporation ("GBC").
The principal set forth in the Note is payable in twelve (12) quarterly
payments of $6,392.58 (SIX THOUSAND, THREE HUNDRED, NINETY-TWO DOLLARS AND
FIFTY-EIGHT CENTS, U.S.). The total amount due under the first such installment
shall be paid in full not later than three (3) months from the date hereof; the
following installments shall be paid every three (3) months thereafter from the
first installment due date.
Debtor shall pay, in whole or in part, the amount due GBC through
purchases of laminating film (the "Film") from GBC. Debtor agrees that in each
three (3) month period during which an installment of principal is due (an
"Installment Period") it will issue its purchase orders to, and purchase from
GBC, Film at a premium price which shall be $.0511 per MSI above GBC's standard
customer price for Film. The $.0511 per MSI premium paid for said Film will be
applied to the principal amount due during each Installment Period. If during
any Installment Period Debtor does not purchase and pay for a sufficient
quantity of Film to satisfy the principal amount doe for that Installment
Period, then the remaining balance of principal for that Installment Period
shall be paid to GBC in cash within thirty (30) days of invoice by GBC.
VOXCOM SALES, LLC d/b/a AMERAPRESS, INC.
----------------------------------------
By:/s/
------------------------------------
UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF TEXAS
FORT WORTH DIVISION
FEDERAL TRADE COMMISSION, )
)
Plaintiff, )
)
v. ) CIVIL ACTION NO. 4-98CV-0143A
)
AMERAPRESS, INC., et al., )
)
Defendants. )
COMPROMISE, RELEASE AND SETTLEMENT AGREEMENT
WHEREAS, Plaintiff, the Federal Trade Commission ("FTC" or
"Commission"), commenced this action by filing a Complaint pursuant to Section
13(b) of the Federal Trade Commission Act ("FTC Act"), 15 U.S.C. ss. 53(b) ; and
WHEREAS, the Defendants answered and denied all material allegations
and filed a Counterclaim alleging certain causes of action; and
WHEREAS, the Commission and Defendants have agreed to the entry of an
Agreed Final Order by the Court, in the form attached hereto as Exhibit 1, in
order to resolve all matters in dispute between them in this action; and
WHEREAS, the Commission and Defendants have consented to entry of this
Agreed Final Order without trial, and it is stipulated that Defendants, by
agreeing to the entry of this Agreed Final Order, do not admit to any violation
of any law, statute, rule or regulation or to the commission of any wrongful
act, and the Commission, by agreeing to the entry of this Agreed Final Order,
does not admit to any violations of law, statute, rule or regulation, or to the
commission of any wrongful act,
1
<PAGE>
but instead denies any violations or wrongdoing.
I.
For the purpose of this Agreement, the term "Defendants" means
AmeraPress, Inc. ("AmeraPress"), Voxcom Sales, LLC, The Home Business Group,
Inc. ("HBG"), Lawrence R. Biggs, Jr., Kim Crowther and Donald G. McLellan, as
well as Vendworx, Inc. ("Vendworx"), Brian Jensen, Gwynda Gee, and Scott Freda,
as additional parties the Commission sought leave to add as Defendants to the
lawsuit (but which leave the Court denied), whether acting directly or through
any entity, corporation, subsidiary, division, or other device.
II.
IT IS HEREBY AGREED that Defendants will pay the sum of FOUR HUNDRED
THOUSAND DOLLARS ($400,000.00), on or before May 15, 1998, to be used by the
Commission to pay refunds to consumers of AmeraPress' goods and services,
including those whose refunds have been previously approved, but not paid, by
AmeraPress as of April 6, 1998. Defendants will pay an additional SIXTY-FIVE
THOUSAND DOLLARS ($65,000.00) on or before May 15, 1998 which will be used by
the Commission to pay refunds to consumers of HBG's goods and services,
including those whose refunds have been previously approved, but not paid, by
HBG as of April 6, 1998. Defendants will also pay to the Commission THIRTY-FIVE
THOUSAND DOLLARS ($35,000) on or before May 15, 1998 which may be used by the
Commission for consumer redress or its administrative expenses in connection
herewith. These payments are being made in order to compromise and settle this
lawsuit.
III.
As consideration for the agreements recited herein, the Federal Trade
Commission hereby
2
<PAGE>
releases the Defendants, each of their officers, agents, employees,
representatives, shareholders, attorneys and board members from any and all
liability, whether known or unknown, which was or could have been raised in the
lawsuit referenced above for any acts or omissions regarding the advertising,
offering for sale, licensing, contracting, sale, or other promotion of a
business venture by AmeraPress, HBG, and/or Vendworx up to and including the day
on which this agreement is signed. The parties intend this to be a global, all
encompassing release.
IV.
IT IS FURTHER AGREED that, within five business days after receipt of
the Agreed Final Order as entered by the Court, each Defendant shall submit to
the Commission a truthful sworn statement that shall acknowledge receipt of the
Agreed Final Order, noting date of receipt and attaching a copy of the Agreed
Final Order received.
V.
IT IS FURTHER AGREED that if the Commission, in its sole discretion,
determines that redress is wholly or partially impractical, any funds not so
used shall be deposited in the United States Treasury. The Commission, in its
sole discretion, may use a designated agent to administer consumer redress, and
may in its sole discretion extend the deadline for accepting claims. Defendants
waive any right to contest the disposition of the funds paid pursuant to the
terms of this Agreement. All payments made to consumers as described herein
shall be conditioned on consumers releasing Defendants for all claims related to
the purchase of goods and services from Defendants. Defendants agree to
cooperate with the Commission, as the Commission may request, in the
administration of any redress procedures, and upon request agree to review and
product information concerning the validity of consumer redress claims made. The
Commission agrees to provide to
3
<PAGE>
Defendants AmeraPress and HBG lists of consumers accepting payment from the
funds, and copies of the front and back of the checks by which consumers have
been paid, showing the name and address of the consumer, the amount of payment
and the signature on the release.
IV.
IT IS FURTHER AGREED that each of the notices any party is required to
give to another pursuant to this Agreement shall identify this action by its
name and case number, and be addressed: (1) if to the Federal Trade Commission,
to: Associate Director, Division of Marketing Practices, Federal Trade
Commission, Washington, D.C. 20580 (2) if to Defendants, to: Lawrence R. Biggs,
Jr., 8115 Preston Road, Suite 800E, Dallas, Texas 75225, or to those addresses
of Defendants as may be forwarded to the Federal Trade Commission at the above
address from time to time.
VII.
Plaintiff agrees that, before seeking any civil remedies against any of
the Defendants in the future regarding the advertising, offering for sale,
licensing, contracting, sale, or other promotion of a business venture by
AmeraPress, HBG, and/or Vendworx it will provide at least ten (10) days written
notice to each of such Defendants at issue, setting forth a date, time and place
where such civil remedy may be sought. The Commission further agrees that,
before or during this ten day period, it will meet and confer with the
Defendant(s) at issue and such person(s)' attorneys.
AGREED:
/s/ Hugh Stevenson Dated: April 7, 1998
- --------------------------------------------
HUGH STEVENSON
Acting Deputy Director, Bureau of Consumer Protection
Federal Trade Commission
4
<PAGE>
ATTORNEYS FOR PLAINTIFF
FEDERAL TRADE COMMISSION
This Agreement is being signed on behalf of the Federal Trade Commission by Hugh
Stevenson, Acting Deputy Director of the Bureau of Consumer Protection of the
Federal Trade Commission, who, by signing this Agreement, represents that he
approves this Agreement on behalf of the Director of Bureau of Consumer
Protection of the Federal Trade Commission, and will recommend and use his best
efforts to obtain the approval of the Federal Trade Commission by 5:00 p.m.,
Central Daylight Savings Time on Thursday, April 9, 1998. If the Federal Trade
Commission approves this Agreement and the Agreed Final Order by 5:00 p.m.,
Central Daylight Savings Time on Thursday, April 9, 1998, counsel for the
Federal Trade Commission will notify the Defendants in writing, by facsimile
transmission to Mark Enoch by 6:00 p.m., Central Daylight Savings Time on
Thursday, April 9, 1998.
[COMPANY SIGNATURE PAGES OMITTED]
5
VOXCOM HOLDINGS, INC.
Statement regarding computation of earnings per share.
The computation of earnings per share can be clearly determined from the
information provided in the consolidated financial statements included in the
Form 10SB. During a loss period, the assumed exercise of stock options have an
antidilutive effect. As a result, these shares are not included in the weighted
average shares outstanding until actual conversion to common stock occurs.
VOXCOM HOLDINGS, INC.
Subsidiaries
AmeraPress, Inc., a Nevada corporation
Voxcom Systems, Inc., a Delaware corporation
MAXpc Technologies, Inc., a Texas corporation
Home Business Group, Inc., a Nevada corporation
All subsidiaries are wholly owned by the Company
<PAGE>
EXHIBIT 27.01
<TABLE>
<CAPTION>
Appendix A to Item 601(c) of Regulation S-B
Commercial and Industrial Companies
Article 5 of Regulation S-X
Item Number Item Description
<S> <C>
5-02(1) cash and cash items 241,884
5-02(2) marketable securities --
5-02(3)(a)(1) notes and accounts receivable-trade --
5-02(4) allowances for doubtful accounts --
5-02(6) inventory 381,952
5-02(9) total current assets 1,469,275
5-02(13) property plant and equipment 876,076
5-02(14) accumulated depreciation 164,835
5-02(18) total assets 3,327,546
5-02(21) total current liabilities 2,623,502
5-02(22) bonds, mortgages and similar debt --
5-02(28) preferred stock-mandatory redemption --
5-02(29) preferred stock-no mandatory redemption 8,000,000
5-02(30) common stock 557
5-02(31) other stockholders' equity (7,296,513)
5-02(32) total liabilities and stockholders' equity 3,327,546
5-03(b)1(a) net sales of tnagible products 12,287,356
5-03(b)1 total revenues 12,287,356
5-03(b)2(a) cost of tangible goods sold 1,410,316
5-03(b)2 total costs and expenses applicable sales and revenues 8,745,123
5-03(b)3 other costs and expenses --
5-03(b)5 provision for doubtful accounts and notes --
5-03(b)(8) interest and amortization of debt discount 140,412
5-03(b)(10) income before taxes and other items 1,991,505
5-03(b)(11) income tax expense 736,857
5-03(b)(14) income/loss continuing operations 1,254,648
5-03(b)(15) discontinued operations --
5-03(b)(17) extraordinary items --
5-03(b)(18) cumulative effect-changes in accounting principles --
5-03(b)(19) net income or loss 1,254,648
5-03(b)(20) earnings per share-primary 0.24
5-03(b)(20) earnings per share-fully diluted --
</TABLE>
