UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
Genesis Capital Corporation of Nevada
(Name of Issuer)
Common Stock, par value $0.001
(Title of Class of Securities)
37183K 10 6
(CUSIP Number)
Reginald Davis, 11701 South Freeway, Burleson Texas
76028 (Name, address and telephone number of person authorized to
receive notices and communications)
September 28, 1999
(Date of Event which Requires Filing of This Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13A, and is filing this
schedule because of Rule 13d-1(b)(3) or (4), check the following box ( ).
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SCHEDULE 13D
CUSIP No. 37183K 10 6 Page 2 of 19 Pages including exhibits
1) NAME OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Hudson Consulting Group, Inc.
2) CHECK THE APPROPRIATE BOX IF EITHER IS A MEMBER OF A GROUP
(A) ( )
(B) ( )
3) SEC USE ONLY
4) SOURCE OF FUNDS
OO
5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) or 2(E). [ ]
6) CITIZENSHIP OR PLACE OF ORGANIZATION
Hudson Consulting Group is incorporated in the State of Nevada
7) SOLE VOTING POWER 564,040
NUMBER OF
SHARES
BENEFICIALLY 8) SHARED VOTING POWER 0
OWNED BY
EACH
REPORTING 9) SOLE DISPOSITIVE POWER 564,040
PERSON WITH
10) SHARED DISPOSITIVE POWER 0
11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
564,040
12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES ( )
13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
27.3 %
14) TYPE OF REPORTING PERSON
CO
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Item 1. Security and Issuer
This schedule relates to common stock, par value $0.001 per share, of
Genesis Capital Corporation of Nevada ("Common Stock"). Genesis Capital
Corporation of Nevada ("Genesis") is a Nevada corporation with its current
principal offices at 11701 South Freeway, Burleson, Texas, 76028. The principal
offices of Hudson Consulting Group, Inc. are at 268 West 400 South, Suite 300,
Salt Lake City, Utah 84101.
Item 2. Identity and Background
(a) This schedule is filed by Hudson Consulting Group, Inc., a Nevada
corporation ("Hudson").
(b) The business address for Hudson is 268 West 400 South, Salt Lake City, Utah
84101.
(c) The principal business of Hudson is providing financial and business
consulting services.
(d) Hudson has not been convicted in a criminal proceeding (excluding traffic
violations and similar misdemeanors) during the last five years.
(e) During the last five years Hudson has never been a party to a civil
proceeding that resulted in a judgment, decree or final order enjoining future
violations of, or prohibiting or mandating activities subject to, federal or
state securities laws or finding any violation with respect to such laws.
(f) Hudson is a Nevada corporation
Item 3. Source and Amount of Funds or Other Consideration
Out of the total 564,040 shares of Genesis stock currently held by
Hudson, and the subject of this Schedule, 31,400 shares were acquired by Hudson
pursuant to a private placement on March 25, 1999, and the other 532,640 shares
were issued to Hudson pursuant to the Consulting Agreement dated March 19, 1999
and the Addendum #1 to the Acquisition Agreement dated May 10, 1999. Pursuant to
the March 19 Agreement, Hudson was entitled to 455,000 shares of Genesis stock
for consulting services, and the May 10 Agreement entitled Hudson to receive the
remaining 77,640 shares for additional consulting services.
Item 4. Purpose of Transaction
The following discussion states the purpose or purposes of the
acquisition of securities of the issuer and describes any plans or proposals
resulting in material transactions with Genesis. Hudson is a financial
consulting firm that specializes in assisting private companies in becoming
public, debt settlement and other business related services. Genesis is
currently a public shell with no operations.
Hudson's intentions are to assist Genesis in finding a suitable partner
for a merger or an acquisition candidate which (1) may cause a change in the
present board of directors of Genesis; (2) the present capitalization of
Genesis; (3) changes in Genesis' charter and (4) other material changes which
are not known at this time.
Item 5. Interest in Securities of the Issuer
(a) The aggregate number and percentage of class of securities identified
pursuant to Item 1 beneficially owned by Hudson may be found in rows 7 - 11 and
13 of the cover page.
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(b) The powers that Hudson has relative to the shares discussed herein may be
found in rows 7 through 10 of the cover page. The quantity of shares owned by
Hudson is 564,040 shares of Common Stock which were acquired pursuant to the
March 19, 1999 and May 10, 1999 Agreements as well as the March 25 issuance
under Rule 504.
(c) There were no transactions in the class of securities reported on that were
effected during the last sixty days aside from those discussed in Item 4.
(d) Richard D. Surber has power to direct the receipt of dividends from, or the
proceeds from the sale of, such securities by virtue of his position as the
President of Hudson..
Item 6. Contracts, Arrangements, Understandings or Relationships with Respect to
Securities of the Issuer.
There are currently no contracts, arrangements, understandings or
relationships with respect to securities of Genesis.
Item 7. Material to Be Filed as Exhibits.
A. Attached as Exhibit A is a copy of the Consulting Agreement dated March
19, 1999 between Hudson and Genesis.
B. Attached as Exhibit B is a copy of the Addendum #1 to Acquisition
Agreement, dated May 10, 1999.
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
Hudson Consulting Group, Inc.
Date: Feb 18, 2000 /s/ Richard D. Surber
------------------------------
Richard D. Surber, President
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Attention: Intentional misstatements or omissions of fact constitute Federal
criminal violations (See 18 U.S.C. 1061).
EXHIBIT A
Consulting Agreement
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CONSULTING AGREEMENT
THIS CONSULTING AGREEMENT ( "Agreement") is made effective this 19th
day of March 1999, by and between Hudson Consulting Group, Inc., a Nevada
corporation ("Consultant") and Genesis Capital Corporation of Nevada, a Nevada
corporation (the "Company").
WHEREAS, Consultant and Consultant's personnel are in the business of
assisting development stage companies through locating, evaluating, and
effecting mergers and acquisitions;
WHEREAS, Consultant also provides general financial advice to corporate
management and performs general administrative duties for publicly-held
companies; and
WHEREAS, the Company desires to retain Consultant to advise and assist
it, on the terms and conditions set forth below.
NOW, THEREFORE, in consideration of the mutual promises, covenants and
agreements contained herein, and for other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the Company and
Consultant agree as follows:
1. Engagement
The Company hereby retains Consultant, effective the date hereof and
continuing until termination, as provided herein, to (1) assist the
Company in locating evaluating, and effecting a merger and/or
acquisition; (2) provide general financial advice to corporate
management; (3) provide general administrative duties and (4) assist in
the acquisition of various assets (collectively termed the "Services").
The Services are to be provided on a "best efforts" basis directly and
through Consultant's employees or others employed or retained and under
the direction of Consultant ("Consultant's Personnel"); provided,
however, that the Services are expressly agreed to exclude all legal
advice, accounting services or other services which require licenses or
certification.
2. Term
This Agreement shall have an initial term of one (1) year (the "Primary
Term"), with an effective date retroactive to the date services were
first performed by Consultant, which was on or about September 1, 1998,
and may be renewed at the Company's option by written notice of
renewal.
3. Time and Effort of Consultant
Consultant shall allocate time and Consultant's personnel as it deems
necessary to provide the Services. The particular amount of time may
vary from day to day or week to week. Consultant has provided a
statement identifying, in general, the tasks it has performed from
September 1, 1998 to March 19, 1999. The Company has reviewed this
statement and believes the time and effort expended by Consultant to be
reasonable for the tasks it has completed. Consultant will continue to
provide billing statements on a monthly basis or within (7) days of the
Company's request. These billing
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statements shall be conclusive evidence that the Services have been
performed. Additionally, in the absence of willful misfeasance, bad
faith, or reckless disregard for the obligations or duties hereunder by
Consultant, neither Consultant nor Consultant's personnel shall be
liable to the Company or any of its shareholders for any act or
omission in the course of or connected with rendering the Services,
including but not limited to losses that may be sustained in any
corporate act in any subsequent Asset Opportunity or Business
Opportunity (as defined herein) undertaken by the Company as a result
of advice provided by Consultant or Consultant's personnel.
4. Compensation
The Company agrees to pay Consultant a fee for the Services it has
provided from September 1, 1998 to March 19, 1999 (the "Initial Fee")
in the following manner: by issuing Four Hundred Fifty-Five Thousand
(455,000) shares of the Company's common stock issued pursuant to Rule
504 of Regulation D of the Securities Act of 1933 (the "'33 Act").
5. Compensation for Other Services
If the Company after the date hereof enters into a merger or
acquisition, or enters into an agreement for the purchase of assets, as
a direct or indirect result of Consultant's efforts, the Company agrees
to pay Consultant a fee in the manner described below.
If Consultant provides any material assistance to the Company in a
merger, acquisition or asset purchase of an entity ("Business
Opportunity"), which assistance includes (but is not limited to)
introducing the Business Opportunity to the Company or helping to
prepare documents used in negotiating such Business Opportunity,
Consultant shall be paid the following amounts ("M&A Fee"): $33,000 in
cash; and a promissory note in the amount of $67,000 (attached as
Exhibit "A"), secured by Six Hundred Seventy Thousand (670,000) shares
of the Company's common stock issued pursuant to Rule 504 of Regulation
D of the '33 Act. The $33,000 in cash, the $67,000 promissory note, and
the Six Hundred Seventy Thousand (670,000) shares securing such
promissory note shall be delivered to Consultant on the date the
Company signs a Merger, Acquisition or Asset Purchase Agreement. For
purposes of determining Consultant's M&A Fee, the Company's shares
shall be valued at $.10 per share.
If the Company acquires any asset or obtains any payment or other
benefit, other than a Business Opportunity described above, as a result
of Consultant's Services (an "Asset Opportunity"), the Company agrees
to pay Consultant 10% of the gross value of such Asset Opportunity. The
Company will pay Consultant in cash, shares of the Company or in like
kind for each Asset Opportunity the Company acquires as a result of
Consultant's efforts ("Consultant's Fee"). Such payment shall be made
on the date the Company substantially completes the transaction
involved with such Asset Opportunity.
The Initial Fee, Consultant's Fee, M&A Fee and any other shares issued
pursuant to this Agreement are in addition to any preferred shares paid
to Consultant for services rendered.
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6. Registration of Shares
Consultant agrees to accept the above-described shares as compensation,
based on exemptions from registration provided by Section 4(2) of the
'33 Act, Regulation D of the '33 Act, and applicable state securities
laws. The Company shall have no obligation to register Consultant's
shares.
7. Costs and Expenses
All third-party and out-of-pocket expenses incurred by Consultant in
the performance of the Services shall be paid by the Company, or shall
be reimbursed if paid by Consultant on behalf of the Company, within
ten (10) days of receipt of written notice by Consultant, provided that
the Company must approve in advance all such expenses in excess of $500
per month.
8. Place of Services
The Services provided by Consultant or Consultant's Personnel will be
performed at Consultant's offices except as otherwise mutually agreed
in writing by Consultant and the Company.
9. Independent Contractor
Consultant and Consultant's Personnel will act as independent
contractors in the performance of any duties under this Agreement.
Accordingly, Consultant will be responsible for paying all federal,
state, and local taxes on compensation paid under this Agreement,
including income and social security taxes, unemployment insurance, and
any other taxes due relative to Consultant's Personnel, and any and all
business license fees as may be required. This Agreement neither
expressly nor impliedly creates a relationship of principal and agent,
or employer and employee, between the Company and Consultant's
Personnel. Neither Consultant nor Consultant's Personnel are authorized
to enter into any agreements on behalf of the Company. The Company
expressly retains the right to approve, in its sole discretion, each
Asset Opportunity or Business Opportunity introduced by Consultant, and
to make all final decisions with respect to all transactions on any
Asset Opportunity or Business Opportunity.
10. Rejected Asset Opportunity or Business Opportunity
If, during the term of this Agreement, the Company makes a written
election not to proceed to acquire, participate or invest in any Asset
Opportunity or Business Opportunity identified and/or selected by
Consultant, notwithstanding the time and expense the Company may have
incurred reviewing such transaction, such Asset Opportunity or Business
Opportunity shall re-vest back to and become proprietary to Consultant.
Consultant shall be entitled to acquire or broker the sale or
investment in such rejected Asset Opportunity or Business Opportunity
for its own account, or submit such Asset Opportunity or Business
Opportunity elsewhere. In such event, Consultant shall be entitled to
any and all profits or fees resulting from Consultant's purchase,
referral or placement of any such rejected Asset Opportunity or
Business Opportunity, or from the Company's subsequent purchase or
financing with such Asset Opportunity or Business Opportunity in
circumvention of Consultant's reasonable expectation to be paid.
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11. No Agency Express or Implied
This Agreement creates neither a principal-agent nor an
employer-employee relationship, either express or implied, between the
Company and either Consultant or Consultant's Personnel.
12. Termination
The Company and Consultant may terminate this Agreement before the
Primary Term expires, on thirty (30) days written notice, with mutual
written consent. Absent mutual consent, and without prejudice to any
other remedy to which the terminating party may be entitled, either
party may terminate this Agreement with thirty (30) days written notice
under the following conditions:
(A) By the Company.
(i) If during the Primary Term of this Agreement, Consultant is unable
to provide the Services as set forth herein for thirty (30) consecutive
business days because of illness, accident, or other incapacity of
Consultant's personnel; or,
(ii) If Consultant willfully breaches or grossly neglects the duties
required to be performed hereunder; or,
(B) By Consultant.
(i) If the Company breaches this Agreement or fails to make any payment
or provide any information required hereunder; or
(ii) If the Company ceases business or, other than in a merger arranged
by Consultant, sells a controlling interest to a third party, or agrees
to a consolidation or merger of itself with or into another
corporation, or enters into such a transaction outside of the scope of
this Agreement, or sells substantially all of its assets to another
corporation, entity or individual outside the scope of this Agreement;
or
(iii) If the Company has a receiver appointed for its business or
assets, or otherwise becomes insolvent or unable to timely satisfy its
obligations in the ordinary course of business, including but not
limited to the obligation to pay the Initial Fee, the M&A Fee, or the
Consultant's Fee; or
(iv) If the Company institutes or has instituted against it any
bankruptcy proceeding, files a petition in a court of bankruptcy, is
adjudicated a bankrupt, or makes a general assignment for the benefit
of creditors; or
(v) If any disclosure made by the Company, either herein or subsequent
hereto, is materially false or misleading.
If Consultant terminates this Agreement without relying on one of the
conditions listed in B(i) through (v) above, or if this Agreement is
terminated by mutual written agreement before the Primary Term expires,
or if the Company terminates this Agreement for the reasons set forth
in A(i) and (ii) above, the Company shall only pay Consultant for
unreimbursed expenses and for any M&A Fee and/or
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Consultant's Fee accrued up to and including the effective date of
termination. If this Agreement is terminated by the Company for any
other reason, or by Consultant for the reasons set forth in B(i)
through (v) above, the Company shall pay Consultant for unreimbursed
expenses, for any M&A Fee accrued up to and including the effective
date of termination, and for the balance of the Consultant's Fee for
the remainder of the unexpired term of this Agreement.
13. Indemnification
Subject to the provisions herein, the Company and Consultant agree to
indemnify and defend each other, and hold each other harmless, from and
against all demands, claims, actions, losses, damages, liabilities,
costs and expenses, including without limitation interest, penalties,
attorneys' fees and expenses, asserted against, imposed on, or incurred
by either party by reason of or resulting from any action of, or the
breach of any representation, warranty, covenant, condition, or
agreement of, the other party to this Agreement.
14. Remedies
Consultant and the Company acknowledge that in the event of a breach of
this Agreement by either party, money damages would be inadequate, and
the non-breaching party would have no adequate remedy at law.
Accordingly, in the event of any controversy concerning the rights or
obligations under this Agreement, such rights or obligations shall be
enforceable in a court of equity by a decree of specific performance.
Such remedy, however, shall be cumulative and non-exclusive and shall
be in addition to any other remedy to which the parties may be
entitled.
15. Miscellaneous
(A) Subsequent Events. Consultant and the Company each agree to notify
the other party if, subsequent to the date of this Agreement, either
party incurs obligations which could compromise its efforts and
obligations under this Agreement.
(B) Amendment. This Agreement may be amended or modified at any time
and in any manner only by an instrument in writing executed by the
parties hereto.
(C) Further Actions and Assurances. At any time and from time to time,
each party agrees, at its or their expense, to take actions and to
execute and deliver documents as may be reasonably necessary to
effectuate the purposes of this Agreement.
(D) Waiver. Any failure of any party to this Agreement to comply with
any of its obligations, agreements, or conditions hereunder may be
waived in writing by the party to whom such compliance is owed. The
failure of any party to this Agreement to enforce at any time any of
the provisions of this Agreement shall in no way be construed to be a
waiver of any such provision or a waiver of the right of such party
thereafter to enforce each and every such provision. No waiver of any
breach of or non-compliance with this Agreement shall be held to be a
waiver of any other or subsequent breach or non-compliance.
(E) Assignment. Neither this Agreement nor any right created by it
shall be assignable by either party without the prior written consent
of the other.
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(F) Notices. Any notice or other communication required or permitted by
this Agreement must be in writing and shall be deemed to be properly
given when delivered in person to an officer of the other party, when
deposited in the United States mails for transmittal by certified or
registered mail, postage prepaid, when deposited with a public
telegraph company for transmittal, or when sent by facsimile
transmission, provided that the communication is addressed:
(i) In the case of the Company:
Genesis Capital Corporation of Nevada
11701 South Freeway
Burleson, Texas 76028
Telephone: (817) 293-9334
Facsimile: (817) 293-9336
(ii) In the case of Consultant:
Hudson Consulting Group, Inc.
268 West 400 South, Suite 300
Salt Lake City, Utah 84101
Telephone: (801) 575-8073
Facsimile: (801) 575-8092
or to such other person or address designated in writing by the Company
or Consultant to receive notice.
(G) Headings. The headings in this Agreement are inserted for
convenience only and shall not affect in any way the meaning or
interpretation of this Agreement.
(H) Governing Law. The parties agree that this Agreement was negotiated
in, and the place of performance is in, and the place of contracting is
in, the United States of America, State of Utah. Accordingly, this
Agreement shall be governed by the laws of the State of Utah, and of
the United States of America, notwithstanding any conflict-of-law
provision to the contrary. The parties further agree that any action
brought to interpret or enforce any provision of this Agreement shall
be brought exclusively in a court of competent jurisdiction within Salt
Lake County, State of Utah. The parties mutually agree to waive the
operation of any court ruling, statute, or other provision which would
allow or require an action to be brought in any other jurisdiction or
to be governed by any other law than as agreed to herein. The parties
make this waiver with full understanding of its effect.
(I) Binding Effect. This Agreement shall be binding on the parties
hereto and inure to the benefit of the parties, their respective heirs,
administrators, executors, successors, and assigns.
(J) Entire Agreement. This Agreement contains the entire agreement
between the parties hereto and supersedes any and all prior agreements,
arrangements, or understandings between the parties relating to the
subject matter of this Agreement. No oral understandings, statements,
promises, or inducements contrary to the terms of this Agreement exist.
No representations, warranties, covenants, or conditions, express or
implied, other than as set forth herein, have been made by any party.
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(K) Severability. If any part of this Agreement is deemed to be void,
illegal, or unenforceable, the balance of the Agreement shall remain in
full force and effect.
(L) Counterparts. A facsimile, telecopy, or other reproduction of 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, by one or more parties
hereto, and such executed copy may be delivered by facsimile or similar
instantaneous electronic transmission device pursuant to which the
signature of or on behalf of such party can be seen. In this event,
such execution and delivery shall be considered valid, binding and
effective for all purposes. At the request of any party hereto, all
parties agree to execute an original of this Agreement as well as any
facsimile, telecopy or other reproduction hereof.
(M) Time is of the Essence. Time is of the essence of this Agreement
and of each and every provision hereof.
IN WITNESS WHEREOF, the parties have executed this Agreement on the
date above written.
"Consultant"
Hudson Consulting Group, Inc.
a Nevada corporation
By: /s/
Name: Richard Surber
Title: President
The "Company"
Genesis Capital Corporation of Nevada
a Nevada corporation
By: /s/
Name: Reginald Davis
Title: President
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Exhibit A
"Promissory Note"
Recourse
$67,000 Dated: March 19, 1999
SECURED PROMISSORY NOTE
FOR VALUE RECEIVED, Genesis Capital Corporation of Nevada ("Maker")
promises to pay to Hudson Consulting Group, Inc. ("Holder"), or to order, the
principal sum of Sixty-Seven Thousand dollars ($67,000).
1. Payments. The principal amount shall be paid in full WITHIN THREE (3) DAYS of
the written demand of Holder upon the Maker, but in any event the principal
amount shall be paid in full no later than June 1, 1999.
2. Interest. The obligation shall bear simple interest at the rate of 12% per
annum, commencing on the date this Note is made, and shall be paid in full on
the date(s) of payment identified in Paragraph 1, above, provided, however, that
the obligation shall bear interest at the rate of 24% per annum on the
occurrence of a default as set forth in Section 5 below.
3. Type and Place of Payments. Payments of principal and interest shall be made
in lawful money of the United States of America to the above-named Holder at 268
West 400 South, Suite 300, Salt Lake City, Utah 84101, or to order.
4. Prepayment. Advance payment or payments may be made on the principal, without
penalty or forfeiture. There shall be no penalty for any prepayment.
5. Default. Upon the occurrence or during the continuance of any one or more of
the events listed below, Holder or the holder of this Note may forthwith or at
any time thereafter during the continuance of any such event, by notice in
writing to the Maker, declare the unpaid balance of the principal of this Note
to be immediately due and payable, and the principal shall become and shall be
immediately due and payable without presentation, demand, protest, notice of
protest, or other notice of dishonor, all of which are hereby expressly waived
by Maker, with full knowledge of the effect of such waiver. The events deemed as
defaults shall include without limitation the following:
(a) Maker's failure to pay the principal and interest of this Note or
any portion thereof when the same shall become due and payable (whether
at maturity as herein expressed, by acceleration, or otherwise) unless
cured within five (5) days after Holder or the holder of this Note
delivers to Maker written notice of default;
(b) Maker's filing a voluntary petition in bankruptcy; or filing a
voluntary petition seeking reorganization; or filing an answer
admitting the jurisdiction of the court and any material allegations of
an involuntary petition filed pursuant to any act of Congress relating
to bankruptcy or to any act purporting to be amendatory thereof; or
making an assignment for the benefit of its creditors; or applying for
or consenting to the appointment of any receiver or trustee for Maker
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or all or any substantial portion of its property; or assigning an
agent to liquidate any substantial part of Maker's assets;
(c) The entry of (i) any court order pursuant to any act of Congress
(or amendment thereof) relating to Maker's bankruptcy or
reorganization; or (ii) any court order approving an involuntary
petition for the bankruptcy or reorganization of the Maker; or (iii)
any court order appointing any receiver or trustee of or for Maker or
for all or any substantial portion of the Maker's property; or (iv) any
writ or warrant of attachment or any similar process issued by any
court against all or any substantial portion of the Maker's property
(unless such court orders, writs, or warrants as identified in
subpoints (i) to (iv) of this paragraph are vacated or stayed or
released or bonded within 60 days after their entry).
6. Attorneys' Fees & Construction. If either party hereto seeks to enforce any
portion of this Note through litigation or arbitration, then the prevailing
party shall be entitled to recover reasonable attorney's fees, costs, and
interest at the maximum legal rate. The parties agree that the interpretation of
any provision in this Agreement shall be governed by the laws of the State of
Utah. The parties further acknowledge that the terms of this Note were
negotiated with the Holder in the State of Utah, that the place of contracting
was in the State of Utah, and that the place for performing this note is in the
State of Utah. Accordingly, the parties irrevocably consent to the jurisdiction
of the United States District Court for the District of Utah and agree to bring
any action solely in that Court. The parties expressly waive the operation of
any court ruling, statute, or other provision that would allow or require suit
to be brought in any other jurisdiction, with full knowledge of the effect of
such waiver.
7. Security. This Note is secured by the pledge of Six Hundred Seventy Thousand
shares of the common stock of Genesis Capital Corporation of Nevada, issued
pursuant to Rule 504 of Regulation D under the Securities Act of 1933 and issued
in the name of the Holder. The shares shall be held by the Holder pursuant to
the Security Agreement between the Maker and the Holder dated March 19, 1999.
Any default, or any failure to make payment in full by the due date(s) described
herein, will result in the immediate and irrevocable delivery of the above
identified stock to the Holder.
By /s/
Name: Reginald L. Davis
Title: President
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EXHIBIT B
Addendum #1 to
Acquisition Agreement
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ADDENDUM #1 TO
ACQUISITION AGREEMENT
THIS ADDENDUM #1 TO ACQUISITION AGREEMENT is made effective this 10th
day of May, 1999, by, between and among Genesis Capital Corporation of Nevada, a
Nevada corporation ("Genesis"); Motor Sports on Dirt, Inc., a Texas Corporation
("Motor"); and the persons listed on Exhibit "A" attached hereto and made a part
hereof, being all of Motor's stockholders as of the date of this Agreement (the
"Sellers").
WHEREAS, the parties to the original Acquisition Agreement dated April
6, 1999 (the "Acquisition Agreement," attached as Exhibit B to this Addendum and
incorporated herein by this reference) mutually desire to amend and modify their
previous agreement according to the terms of this addendum;
NOW, THEREFORE, in consideration of the mutual covenants, agreements,
representations and warranties herein contained, and for other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the
parties hereby agree to amend and modify their previous agreement as follows:
A. Paragraph VII(B) of the Acquisition Agreement is hereby amended to add a
new subparagraph 5, which reads as follows:
"5. Genesis' obligation to pay the Purchase Price of Eleven
Million Seven Hundred Ninety Thousand (11,790,000) shares of
Genesis' Common Stock shall not arise, and shall not be paid,
until all of the following conditions precedent occur:
(i) Genesis has received $100,000 in cash from Erie Holdings for
the purchase of One Million (1,000,000) shares of Genesis'
common stock issued under Rule 504 of Regulation D, and
Genesis has paid that cash toward reducing the $300,000
liability which Genesis owes for consulting and
merger/acquisition services (such payment is further
referenced in Paragraph IV(F) of the original Agreement, and
Paragraph IV(F) is hereby modified according to this
Paragraph VII(B)(5)(i));
(ii) Motor pays the remaining $200,000 liability which Genesis
owes for consulting and merger/acquisition services (i.e.,
that portion of the liability left after the payment
described in VII(B)(5)(i) above);
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(iii)Motor pays the $250,000 liability which Genesis owes for
the repurchase of 600,000 shares of Genesis' preferred
stock; and
(iv) Motor provides to Genesis an opinion letter from a duly
licensed attorney (whose practice is limited primarily to
securities law) that clearly concludes Erie Holdings, Ltd.
is not an "affiliate" of Motor, Genesis, or any other party
to this agreement, as that term is used under the Securities
Act of 1933, as amended, and the Securities Exchange Act of
1934, as amended, as well as the rules and regulations
promulgated thereunder.
(v) Motor provides to Genesis an opinion letter from a duly
licensed attorney (whose practice is limited primarily to
securities law) that clearly concludes that the 1,000,000
shares of Genesis stock issued to Erie Holdings, Ltd. are
exempt from registration under Rule 504 of Regulation D, and
that Genesis does not have a duty to place a restrictive
legend on such stock."
All remaining provisions of the Acquisition Agreement shall remain in
full force and effect as modified by this Addendum #1.
IN WITNESS WHEREOF, the parties have hereto placed their signatures.
GENESIS CAPITAL CORPORATION SELLERS:
OF NEVADA
By: /s/ Reginald Davis /s/ Sally J. Rogers
--------------------- -----------------------------------
Name: Reginald Davis First Walker Family Trust, Shareholder,
Title: President Sally J. Rogers, Trustee
MOTOR SPORTS ON DIRT, INC.
By: /s/ Donald Walker /s/ Arnon O'Brian
--------------------- -----------------------------------
Name: Donald Walker Arnon O'Brien
Title: President
17
<PAGE>
APPENDIX A
ALL OF MOTOR'S SHAREHOLDERS
# OF SHARES OF # OF SHARES
SHAREHOLDER NAME MOTOR OF GENESIS
________________________________________________________________________________
First Walker Family Trust,
Sally J. Rogers, Trustee 500 5,395,000
- --------------------------------------------------------------------------------
Arnon O'Brien 500 5,395,000
________________________________________________________________________________
18
<PAGE>
APPENDIX B
ORIGINAL ACQUISITION AGREEMENT
19
