UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-KSB
(Mark One)
[X] Annual report under Section 13 or 15(d) of the Securities Exchange Act of
1934 (Fee required) for the fiscal year ended December 31, 1995
[ ] Transition report under Section 13 or 15(d) of the Securities Exchange Act
of 1934 (No fee required) for the transition period from to
Commission file number: I-9418
BRIA Communications Corporation
(Name of Small Business Issuer in Its Charter)
New Jersey 22-1644111
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
268 West 400 South, Suite 300, Salt Lake City, Utah 84101
(Address of Principal Executive Offices) (Zip Code)
(801) 575-8073
(Issuer's Telephone Number, Including Area Code)
Securities registered under Section 12(b) of the Exchange Act:
Name of each Exchange
Title of Each Class on Which Registered
Common Stock ($0.001 Par Value) NONE
Check whether the issuer: (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such
shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days.
Yes____ No XX
Check if there is no disclosure of delinquent filers in response to
Item 405 of Regulation S-B not contained in this form, and no disclosure will be
contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-KSB
or any amendment to this Form 10-KSB. [ ]
The issuer's total consolidated revenues for the year ended December
31, 1995, were $128.
The aggregate market value of the registrant's Common Stock, $0.001 par
value (the only class of voting stock), held by non-affiliates was approximately
$6,283,435.50 based on the last sale price thereof reported on the consolidated
tape for September 27, 1996.
At September 27, 1996, the number of shares outstanding of the
registrant's Common Stock, $0.001 par value (the only class of voting stock),
was 8,377,914.
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TABLE OF CONTENTS
PART I Page
Item 1. Description of Business................................................3
Item 2. Description of Property................................................7
Item 3. Legal Proceedings......................................................7
Item 4. Submission of Matters to a Vote of Security Holders....................8
PART II
Item 5. Market for Common Equity and Related Stockholder Matters...............8
Item 6. Management's Discussion and Analysis or Plan of Operation..............9
Item 7. Financial Statements..................................................15
Item 8. Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure..................................................16
PART III
Item 9. Directors and Executive Officers......................................16
Item 10.Executive Compensation................................................17
Item 11.Security Ownership of Certain Beneficial Owners and Management........19
Item 12.Certain Relationships and Related Transactions........................21
Item 13.Exhibits, Lists and Reports on Form 8-K...............................25
SIGNATURES..................................................................26
INDEX TO EXHIBITS...........................................................27
<PAGE>
ITEM 1. DESCRIPTION OF BUSINESS
Introduction
Unless the context indicates otherwise, the term "Company" refers to BRIA
Communications Corporation, a New Jersey corporation formerly known as
Metallurgical Industries, Inc., and its subsidiaries and predecessors. The
Company's executive offices are located at 268 West 400 South, Suite 300, Salt
Lake City, Utah 84101.
The Company's shareholders voted to change the Company's name to BRIA
Communications Corporation at a Special Meeting of Shareholders, originally
scheduled for March 14, 1995, but adjourned until March 21, 1995 ("Special
Meeting"). Of the 157,544 shares of Common Stock represented by person or proxy
at the Special Meeting, 145,147 voted in favor of the name change.
All references to "Common Stock" shall mean the Company's Class A Common
Stock, publicly traded on the OTC-Bulletin Board Quotation System under the
symbol "BRIAA." Prior to March 21, 1995, the Common Stock had a par value of
$0.10. At the Special Meeting the Company's shareholders voted to amend the
Certificate of Incorporation by changing the par value of the Common Stock to
$0.001. This amendment was disclosed in the Company's Annual Report on Form
10-KSB for the year ended December 31, 1994. The Company also has Class B Common
Stock, $0.001 par value, which is not publicly traded. See "Item 5 Market for
Common Equity and Related Stockholder Matters."
Business Development
The Company was incorporated in New Jersey in 1959 under the name
Metallurgical Industries, Inc. Until 1993, the Company was engaged in the repair
of aircraft turbine engine components and the purchasing, processing and selling
of specialty refractory metals. By August 1993, competitive pressure from the
aircraft turbine engine original equipment manufacturers forced the Company to
discontinue operations in that market. Additionally, low levels of demand,
surplus domestic capacity, and increased competition from imports reduced the
Company's profit margins in the specialty refractory metals business to below
the break-even level. As a result, the Company began to downsize its existing
operations and aggressively search for new opportunities or replacements for its
existing businesses.
In early 1994, the Company agreed to merge into MAXMusic, Inc., a Delaware
corporation ("MAXMusic"), pursuant to the Agreement and Plan of Merger dated
July 11, 1994 ("Merger Agreement"). The Company began extensive restructuring
and reorganization in furtherance of the Merger Agreement. Upon the completion
of merger and recapitalization, the shareholders of MAXMusic would have
exchanged 100% of their shares for a minimum of 80% of the Class A Common Stock
of the Company.
On March 18, 1994, a petition was filed against the Company in the U.S.
Bankruptcy Court requesting an order for relief under Chapter 7 of Bankruptcy
Code (case No: 94-31635). This involuntary bankruptcy petition was filed by
three of the Company's major creditors with claims totaling approximately
$147,000. MAXMusic agreed to purchase the debts of the three creditors and the
original petitioners stipulated to an extension of time to answer the petition
until June 1, 1994. This information was disclosed in a report on Form 8-K filed
with the SEC on April 11, 1994. On June 28, 1994, the Company reached a
settlement with the petitioning creditors and a payment was put in escrow to
settle the debt. On July 27, 1994, the U.S. Bankruptcy Court dismissed the
petition pursuant to 11 U.S.C. Section 303(j) of the United States Bankruptcy
Code.
The Company ceased all active operations on June 30, 1994. Four
administrative employees remained on the payroll until September 30, 1994, to
facilitate the sale of the final Company assets in preparation for a planned
merger with MAXMusic. These employees focused their efforts on winding down
unsuccessful operations and settling debts with the Company's creditors. The
four employees were ultimately terminated on September 30, 1994.
<PAGE>
On November 8, 1994, MAXMusic exercised its option to rescind the Merger
Agreement pursuant to the Merger Agreement's terms. MAXMusic had signed
promissory notes totaling over $776,000 plus accrued interest that were due on
July 31, 1994. These notes would have been extinguished as part of the merger.
However, since the merger was rescinded, $287,000 worth of the notes, plus
interest, became immediately due with the remaining $489,250 worth of notes,
plus accrued interest, becoming due over a twelve month period. MAXMusic has
since declared bankruptcy and the Company does not anticipate receiving any
portion of the money due under the terms of the promissory notes.
In August 1994, the Company repaid its largest secured creditor, Midlantic
National Bank, in full. In September 1994, the Company settled with another
secured creditor, who was an officer and director of the Company, by selling him
the remaining equipment owned by the Company for $5,000. This settled a debt
totaling approximately $92,000 plus interest. The equipment had not been sold by
the Company after diligent efforts on its part for over a year.
In September 1994, the Company placed its two wholly owned subsidiaries,
Intermet Resources, Inc., and Advanced Welding and Coating Services, Inc., into
Chapter 7 bankruptcy, case numbers 94-36556 and 94-36561, respectively. The
decision to file for bankruptcy stemmed from the fact that neither subsidiary
was profitable nor, in management's decision, had prospects of becoming
profitable. A trustee was appointed by the Court and at a hearing before the U.
S. Bankruptcy Court in Trenton, New Jersey, on December 7, 1994, the Chapter 7
filings were accepted and the assets of both corporations were liquidated.
After the Merger Agreement with MAXMusic was terminated and the two
subsidiaries were placed in bankruptcy, the Company was left with no active
operations. The Company resumed its efforts to find a suitable merger or
acquisition candidate. During its pursuit of such a candidate, the Company
became involved in the barter and trade industry. On March 1, 1995, the Company
appointed Richard Lifschutz ("Lifschutz") as the Company's president and a
director. Mr. Lifschutz is very experienced in the barter industry and has been
a broker for many years on the ITEX barter exchange, the largest such exchange
in the United States. Soon after the arrival of Lifschutz, the Company began
trading restricted shares of its Common Stock for tangible assets such as media
and trade credits. See "Item 6 - Management Discussion and Analysis" for a
discussion of this change in Company control and the results of operations
stemming from the Company's involvement in the barter industry.
Effective December 8, 1995, the Company entered into a since rescinded
Stock Exchange Agreement (the "Stock Exchange Agreement") with AltaChem Group,
Inc., a corporation formed under the laws of the Republic of Ireland
("AltaChem"), Aster De Schrijver, an individual, and James Tilton, an individual
(these four entities are hereinafter collectively referred to as the "Parties").
AltaChem is a chemical company which manufactures and markets a one-component
polyurethane foam compound and related products used to dispense that chemical.
Pursuant to the Stock Exchange Agreement, the Company acquired 100% of the
outstanding Common Stock of AltaChem, making AltaChem a wholly owned subsidiary.
As consideration, the Company issued 18,740,976 shares of Common Stock to Aster
De Schrijver, who prior to the Stock Exchange Agreement directly or indirectly
owned 100% of AltaChem's outstanding Common Stock. The Company also issued
2,883,200 shares of Common Stock to James Tilton as consideration for services
rendered by Mr. Tilton in negotiating the Stock Exchange Agreement. After the
Stock Exchange Agreement was consummated, Mr. De Schrijver and Mr. Tilton
collectively owned 75% of the Company's issued and outstanding Common Stock.
On August 3, 1995, and in contemplation of the acquisition of AltaChem, the
Company's board of directors appointed Aster De Schrijver, James Tilton and Jane
Zheng as additional directors. Mr. De Schrijver was also appointed as chairman
of the board of directors. Mr. Tilton was appointed as chief executive officer,
and Jane Zheng, the wife of James Tilton, was appointed as the Company's
treasurer and secretary. Upon the respective appointments of three new officers
and directors, Richard Surber and Mark Knudson resigned as the Company's
directors, leaving Richard Lifschutz as the only incumbent director. The
resignations of Mr. Surber and Mr. Knudson were the result of the change of
control in the ownership of the Company's capital stock, and did not reflect any
disagreements on the part of either resigning director with the Company or its
management.
<PAGE>
On May 8, 1996, the parties to the Stock Exchange Agreement mutually agreed
to rescind the Agreement ab initio, or from the beginning. The rescission was
accomplished pursuant to a Rescission of Stock Exchange Agreement and Release of
all Claims signed that day. The primary reason for the rescission was AltaChem's
failure to deliver to the Company audited financial statements and a schedule of
assets within 180 days, as required by the Stock Exchange Agreement. This
delinquency constituted a material breach of the Stock Exchange Agreement and
made it impossible for the Company to stay current in its SEC filings. Moreover,
AltaChem had significantly underestimated the costs associated with the filing
requirements for publicly traded companies in the United States. Accordingly, a
determination was made that it would be in the best interest of all Parties to
rescind the Stock Exchange Agreement.
Pursuant to the Rescission Agreement, the Parties released one another from
all potential claims they may have had stemming from the Stock Exchange
Agreement. Hence, the Company has no relationship with or claims against
AltaChem, and AltaChem has no claims against the Company. Mr. De Schrijver and
Mr. Tilton were required to return their shares to the Company's transfer agent
for cancellation, and the Company was required to return all shares of AltaChem
to Mr. De Schrijver.
On May 31, 1996, Aster De Schrijver resigned as chairman of the board of
directors and Jane Zheng resigned as secretary, treasurer and a director. On
June 24, 1996, James Tilton resigned as chief executive officer and a director.
The three directors resigned because, as a result of the rescinded Stock
Exchange Agreement, shares of Common Stock previously issued to De Schrijver and
Tilton were required to be returned to the Company for cancellation, leaving the
three directors with no ownership interest in the Company. None of the directors
had any disagreements with the Company or its management at the time of their
respective resignations.
On June 7, 1996, the board of directors appointed Harry Tilton, Matthew
Veal and Shirley Tarantino as directors. These directors were appointed to help
the Company organize its management structure and restructure its Bylaws. After
performing such services, Harry Tilton, Matthew Veal and Shirley Tarantino
tendered their respective resignations as directors on June 19, 1996. On June
27, 1996, Isaac Lifschutz and Wendell Hall were appointed as additional
directors of the Company. For more information on the current board of
directors, see "Item 9 - Directors, Executive Officers and Control Persons;
Compliance with Section 16(a) of the Exchange Act."
On July 11, 1996, the Company entered into an agreement with CyberMalls,
Inc. ("CyberMalls"), a Utah corporation wholly owned by Canton Financial
Services Corporation ("CFS"). Pursuant to the agreement the Company purchased
CyberFootball, a Nevada corporation ("CFI") . CFI is developing a virtual mall
on the Internet focused on the sport of football. CFI was founded in 1996 and is
currently a developmental stage corporation. It seeks to become an Internet
Service Provider specializing in global online commerce. The Company acquired
CFI by issuing 1,875,000 shares of its Class A Common Stock valued at .375(cent)
per share to CyberMalls. In exchange, CFI will issue 9,101,019 shares of its
restricted Common Stock to the Company which reflects approximately 90.1% of the
authorized, issued and outstanding shares of CFI. CFI will issue a Promissory
Note in favor of CyberMalls in the amount of $11,500,000 bearing interest of 9%
per annum to be payable in three (3) years from the date of the execution of the
Agreement. The Note shall be secured by the CyberFootball trademark and domain
rights. The Company shall be guarantor of the Note with such guarantee to be
secured only by 100% of the Company's interest in CyberFootball's Common Stock.
Additionally, as compensation for services to be provided in the creation,
development and initial servicing of the virtual mall, CyberMalls will receive
50% of the proceeds realized from a private placement of Common Stock conducted
pursuant to Rule 504 of Regulation D of the Securities Act of 1933. These
proceeds are distrubuted to CyberMalls pursuant to a Financial Consulting
Agreement entered into between the Company, CFI and CFS. The terms of such
Financial Consulting Agreement obligates CFS to provide its best efforts in
assisting CFI to become a self sufficient, fully reporting company under the
Securities and Exchange Act of 1934 that is publicly traded. In exchange CFI is
obligated to compensate CFS by issuing $150,000 worth of the Company's free
trading Class A Common Stock.
<PAGE>
Kingslawn Offset, Inc., a New York corporation engaged in the printing of
full color catalogs, sales sheets, and other publications ("Kingslawn"), was
acquired by the Company on September 10, 1996. In exchange for acquiring all of
Kingslawn's issued and outstanding capital stock, the Company issued 2 million
restricted shares of its Class A Common Stock valued at $0.75 per share.
Kingslawn's President and principal shareholder was also granted a $500,000 lien
on all equipment and fixtures in Kingslawn's possession as of September 10,
1996. This lien is convertible at the holder's option into the Company's Class A
Common Stock at $0.75 per share. Kingslawn thus became a wholly owned subsidiary
of the Company.
Business of Issuer
As stated above, through its subsidiaries, the Company is involved in the
development of an Internet virtual mall and the printing business. Pursuant to
the Company's Agreement with CyberMalls, CyberMalls will design and build the
virtual mall, CyberFootball and will continue to provide the Company with
ongoing maintenance of the Internet mall. CyberMalls is also obligated to
provide WebSafari(TM) for the duration of the business relationship between
CyberMalls and CyberFootball. WebSafari (TM) is a type of search engine that
allows shoppers on the Internet to change locations as their interest desires.
On August 12, 1996, this search engine was successfully tested in its first, or
alpha version and is expected to be ready for initial public use by the end of
September 1996. However, due to increasing competition in the search engine
arena, no assurances can be given that, even if Web SafariTM does operate as
planned, it will be accepted by the public or yield profits.
The September 10, 1996 Agreement for the exchange of stock between the
Company and Kingslawn envisions continuing in its normal printing operations.
However, the Company and Kingslawn have discussed possible additional
acquisitions of entities to complement Kingslawn's business, although no such
assurances can be given that any of the acquisitions will be made, or if made
that they will be successful or profitable.
The Company continues to search for appropriate business opportunities,
including businesses which the Company can acquire as operating subsidiaries. To
help it find appropriate business opportunities, the Company has employed the
services of Canton Financial Services Corporation ("CFS"). CFS provides business
services to the Company including administrative, accounting, and shareholder
relations work. CFS also leases office space to the Company. Originally retained
in May 1995, CFS is currently rendering services to the Company pursuant to an
April 1, 1996 Consulting Agreement (the "Consulting Agreement"). According to
the Consulting Agreement, the Company is obligated to pay CFS a monthly
consulting fee equaling $20,000 or the actual cost of services rendered by CFS
if such cost exceeds $20,000. The fee is payable either in cash or in restricted
shares of the Company's Common Stock valued at the lower of one-half (1/2) the
closing bid price on the last day of the month in which services are rendered to
the Company or one-half (1/2) the closing bid price on the day the Common Stock
is actually issued to CFS. CFS is an affiliate of CyberMalls.
The Company has no full time employees. However, pursuant to its Consulting
Agreements with CFS and CyberMalls, it receives consulting, administrative and
other services as needed for its development. CFS employs approximately 40
full-time employees and independent consultants, many of whom have rendered
services to the Company. CyberMalls' staff includes 23 employees and Kingslawn
Offset has a staff of 5 employees.
<PAGE>
ITEM 2. DESCRIPTION OF PROPERTY
Kingslawn does not currently own any property and does not anticipate the
purchase of additional property in the near future.
The Company's principal offices are located at 268 West 400 South, Suite
300, Salt Lake City, Utah 84101. The Company leases office space, accounting,
secretarial services and office supplies from Canton Financial Services
Corporation pursuant to a April 1, 1996 Consulting Agreement. For more
information on this Consulting Agreement, see "Item 1 - Description of Business"
and "Item 12 - Certain Relationships and Related Transactions."
ITEM 3. LEGAL PROCEEDINGS
The following discussion describes all material pending legal proceedings
involving the Company:
Between November 1986 and March 1994, the Company leased a manufacturing
facility located at 1 Coldstream Way, Tinton Falls, New Jersey from Mid-Monmouth
Realty Association, whose principal offices are at 75 Eisenhower Parkway,
Roseland, New Jersey. The Environmental Cleanup and Responsibility Act ("ECRA")
of New Jersey imposed a number of obligations on the Company; however, since the
Company does not own its facility in Tinton Falls, the obligations are jointly
and severally the obligations of the Company and Landlord. On November 29, 1995,
the New Jersey Department of Environmental Protection and Energy (NJDEPE)
completed a review of this site with the cooperation of Company's former
Landlord. NJDEPE requested that the Company/Landlord do further sampling on
various portions of the site, such as the storage and waste tanks, the former
settling pond, pipe discharges, below-ground-surface soil and groundwater. The
Company/Landlord is also required to submit a revised Remedial Action Schedule
and summarized analytical results on the samplings. As of September 30, 1996,
the Company has not received any statements of costs from the Landlord.
The Company and the Landlord entered into a lease modification in October
1993 under which, among other things, the Landlord agreed to perform whatever
environmental study and remediation would be required to satisfy the NJDEPE. The
Company agreed to reimburse the Landlord for the costs associated with this, all
of which is secured. The first $100,000 is secured and subordinate only to the
secured interest of Midlantic National Bank, taxes owed to the Internal Revenue
Service, and State of New Jersey taxes. Any liability in excess of $100,000 is
secured but subordinate to security interest of the same entities plus that of
Ira Friedman and Lawrence Friedman, former principals of the Company. As of
September 30, 1996, the Landlord has not advised the Company of the cost it has
incurred nor has the Landlord disclosed to the Company the results of the
studies and tests conducted. The company had insurance policies with Greater New
York Mutual Insurance Company which the Company believes should cover
approximately $100,000 of the cleanup costs. Although the insurance company has
indicated that it would decline coverage, in the opinion of the Company's
special insurance counsel and with the support of New Jersey case law, the
Company believes that it has insurance coverage for the first $100,000 incurred
in remediating the Tinton Falls plant site. However, no assurance can be given
that Greater New York Mutual Insurance Company will cover any costs incurred at
this site.
Pursuant to the Lease Agreement with the Landlord by which the Company
leased manufacturing, storage and office facilities, the stated terms of tenancy
was from month to month after December 31, 1993, terminable by either party on
30 days prior notice but no later than March 31, 1994. The Company was evicted
on or about March 31, 1994. The Landlord has continued to bill the Company for a
variety of charges since that date resulting in a disagreement over the amount
owed by the Company. The Company believes that additional charges are not
justified according to the terms of the lease agreement. As of December 31,
1994, the Company has recorded an obligation of $354,711 as compared to the
Landlord's claim for $945,344, resulting in an amount in dispute of
approximately $590,633. This disputed amount does not appear as an obligation on
the Company's financial statements as no lawsuits have been filed to date
regarding the disputed amount. However, the Landlord received a judgement in its
favor in 1993 in the amount of $351,005 representing the Company's obligation at
September 24, 1993, and the Company believes that it is possible, although not
probable, that an unfavorable outcome regarding the disputed amount would be
rendered.
<PAGE>
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
The Company did not submit any matters to a vote of security holders during
the fourth quarter of the fiscal year ending December 31, 1995.
PART II
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
The following table sets forth the prices of the Company's Class A Common
Stock on the OTC Bulletin Board for each quarter during fiscal years 1994 and
1995, and for the first two quarters of fiscal year 1996. The National
Association of Securities Dealers was the source of the information for these
prices. These over-the-counter market quotations are based on inter-dealer bid
prices, without markup, markdown, or commission, and may not necessarily
represent actual transactions.
BID QUOTATION
Fiscal Year 1994 High Bid Price Low Bid Price
Quarter Ended 03/31/94 $1.19 $0.16
Quarter Ended 06/30/94 $0.69 $0.28
Quarter Ended 09/30/94 $0.34 $0.25
Quarter Ended 12/31/94 $0.28 $0.03
Fiscal Year 1995(1)
Quarter Ended 03/31/95 $1.87 $1.25
Quarter Ended 06/30/95 $1.50 $0.50
Quarter Ended 09/30/95 $1.50 $0.50
Quarter Ended 12/31/95 $1.00 $0.50
Fiscal Year 1996
Quarter Ended 03/31/96 $1.00 $0.69
Quarter Ended 06/30/96 $1.00 $0.50
On February 1, 1995, the Board of Directors unanimously approved a 1-for-40
reverse stock split of the Class A Common Stock (the "Reverse Split"). The bid
price of the Class A Common Stock before the Reverse Split was $1/32, roughly
three cents per share whereas after the Reverse Split, on February 6, 1995, the
bid price was $1.13. At the same time, the Board of Directors decreased the
authorized number of shares to assure that the rights and preferences of the
holders of outstanding shares of Class A Common Stock were not adversely
affected.
- ---------------------------
(1)All quotes for fiscal years 1995 and 1996 reflect a 1-for-40 reverse
stock split of the Company's Class A Common Stock effective February 1, 1995.
For more information on this reverse split, see the text belo the bid quotation
table
<PAGE>
STOCKHOLDERS
On December 31, 1995, there were approximately 707 record owners of the
Company's Class A Common Stock, holding 6,798,186 shares. As of September 27,
1996 there are approximately 724 record owners of Class A Common Stock holding
8,377,914 shares.
On December 31, 1995 and as of September 27, 1996, there were 2 record
owners of the Company's Class B Common Stock, holding 213,440 shares.
DIVIDENDS
Due to its limited cash flow, the Company has not declared a cash dividend
for the past two fiscal years on either the Class A Common Stock or the Class B
Common Stock and does not anticipate doing so in the near future.
ITEM 6. MANAGEMENT'S PLAN OF OPERATION
Prior to June 1994, the Company was involved in the repair of aircraft
turbines and engine components and the purchasing, processing and selling of
specialty refractory metals. All active operations in such industries were
ceased in June 1994. This cessation has significantly affected the Company's
performance for fiscal 1995 and 1994 relative to fiscal 1993.
DISCUSSION OF OPERATIONS
When the Company decided to cease its metal related operations, it began
seeking suitable merger and acquisition candidates. On July 11, 1994, the
Company signed a Definitive Merger Agreement with MAXMusic, Inc., a Delaware
corporation located in Denver, Colorado ("MAX"). MAX was involved in producing,
recording, marketing and selling musical merchandise.
The Company was advised on November 8, 1994 that MAX was exercising its
option to rescind the Definitive Merger Agreement pursuant to its terms. When
MAX rescinded this deal, it became obligated to pay the Company promissory notes
worth $776,000. However, MAX filed Chapter 7 bankruptcy on March 3, 1995,
claiming that no assets were available for bankruptcy liquidation to unsecured
creditors such as the Company. Thus, the Company does not expect to receive any
proceeds from MAX's liquidation, although a remote possibility exists that the
Company could be offered some assets by MAX's bankruptcy trustee if a
determination is made that assets are available to MAX's unsecured creditors. As
of September 30, 1996, no such declaration had been made and the Company does
not expect such a statement to be made in the future.
<PAGE>
Two of the Company's wholly-owned subsidiaries, Intermet Resources, Inc.,
and Advanced Welding and Coating Services, Inc. ("AWACS"), were placed into
Chapter 7 bankruptcy, case numbers 94-36556 and 94-36561, respectively, in
September 1994. The decision to file for bankruptcy stemmed from the fact that
neither subsidiary was profitable nor, in then-management's decision, had
prospects of becoming profitable. A trustee was appointed by the Court. At a
hearing before the U. S. Bankruptcy Court in Trenton, New Jersey, on December 7,
1994, the Chapter 7 filings were accepted and the assets of both corporations
were liquidated.
The continued focus on locating a suitable merger and acquisition candidate
in late 1994 resulted in a change in the Company's management. Control of the
Company shifted to Richard D. Surber in December 1994, pursuant to a Settlement
Agreement dated December 16, 1994, by and among the Company, Ira L. Friedman,
formerly the president, chief executive officer and a director of the Company
("Friedman"), Richard T. Johnson, formerly the chief financial officer, vice
president of finance and a director of the Company ("Johnson"), The Canton
Industrial Corporation, a Nevada corporation n/k/a CyberAmerica Corporation
("Canton"), and A-Z Professional Consultants, Inc., a Utah corporation ("A-Z")
(the "Settlement Agreement"). The Settlement Agreement also resolved disputes
over agreements that involved consulting arrangements and organizational
consolidations among the Company, Canton and A-Z, many of which were never
consummated. Richard D. Surber, a director and the chief executive officer of
Canton, is the president and sole director of A-Z. Mr. Surber's control arose
from his appointment as the Company's president and a director, and his indirect
beneficial ownership of voting securities. (For more information of these
transactions see "Item 12 - Certain Relationships and Related Transactions")
In consideration for the release by Canton and A-Z of the Company, Friedman
and Johnson from any and all claims, causes of action, and obligations relating
to the agreements, Friedman and Johnson appointed Richard D. Surber as president
and director of the Company and agreed to appoint two other persons to the
Company's board that Canton would nominate. The Settlement Agreement also
required the Company to issue 1.612 million shares of its Common Stock to
Canton. Canton subsequently assigned these shares to A-Z. The Settlement
Agreement also called for the resignations of all previous officers and
directors. These resignations temporarily left Mr. Surber as the Company's sole
director, until the appointments of Bobby G. Welch II and Christopher Swaner in
January 1995.
On March 3, 1995, Bobby Welch resigned as the Company's director. On March
30, 1995, Christopher Swaner also resigned as a director. Neither of the
resigning directors had any disagreements with the Company or its management at
the time of their respective resignations. On March 30, 1995 Mark Knudson was
appointed as a director of the Company.
Pursuant to a Letter Agreement dated July 7, 1995 and its Addendum dated
July 11, 1995, certain terms of the Settlement Agreement were modified to
include, among other terms, the issuance of certain shares of the Company's
Common Stock to Friedman and Johnson. Ira Friedman was issued 85,800 shares,
which include 55,800 shares for services rendered prior to 1995 and 30,000
shares for the services that Material Technology, Inc., a company controlled by
Ira Friedman and Richard Johnson, rendered in 1995. The Company also issued
79,200 shares to Richard Johnson, including 55,800 shares for services rendered
prior to 1995 and 23,400 shares for services that Material Technology, Inc. a
company over which Richard Johnson shares control with Ira Friedman, provided
during 1995. In addition, the Company issued 20,000 shares of common stock to
Ira Friedman and Richard Johnson, jointly, for their March 1995 payment of
$12,537 to the IRS for payroll taxes.
Immediately after the 1994 change in control, the Company's principal
offices moved from Tinton Falls, New Jersey, to Salt Lake City, Utah. The
services of Canton Financial Services Corporation, a Nevada corporation wholly
owned by Canton ("CFS"), were initially retained pursuant to the Settlement
Agreement and later pursuant to a Consulting Agreement dated May 16, 1995 but
retroactively effective on February 18, 1995 ("Consulting Agreement"). (See
"Item 1 Description of Business" for additional information on the terms of the
Consulting Agreement.) Pursuant to the Consulting Agreement, CFS has continued
to provide a variety of consulting services and administrative tasks in exchange
for a monthly fee based on the hourly rates of CFS's employees and payable in
restricted shares of the Company's Class A Common Stock. Although the Consulting
Agreement's term was one year, it provided for extension on a monthly basis. On
April 1, 1996 the Company renewed the Consulting Agreement. CFS provides the
Company with office space as well as internal record keeping, the preparation of
reports required to be filed with Securities and Exchange Commission ("SEC"),
the negotiation of settlement of the Company's debts, and the search for viable
merger or acquisition candidates.
<PAGE>
A Special Meeting of the Company's Shareholders of the Company was
scheduled for March 14, 1995; however, because of the lack of a quorum, it was
adjourned to and completed on March 21, 1995 (the "Meeting"). The Meeting was
called by the board of directors to execute changes it deemed necessary for the
Company's survival. All of the directors and the owners of at least two-thirds
of the shares voted at the Meeting and approved the following proposals: to
increase the number of authorized shares of the Company to two hundred million
shares of Class A Common Stock and two hundred twenty thousand shares of Class B
Common Stock, par value $0.10; to amend the Company's Certificate of
Incorporation to reduce the par value per share of Class A and Class B Common
Stock of the Company from $0.10 to $0.001; to amend the Company's Certificate of
Incorporation to permit amendments to the Company's Certificate of Incorporation
to be executed by a majority of shareholders; and to change the company's name
to BRIA Communications Corp., effective April 9, 1996. A Certificate of
Amendment to the Certificate of Incorporation was filed with the Secretary of
State of New Jersey on April 9, 1996, which sets forth these changes. See "Item
1 - Description of Business" for an additional discussion on the Company's
corporate status in New Jersey and see "Item 4 - Submission of Matters to a Vote
of Security Holders" for additional information regarding the special meeting of
shareholders.
One of the more important results of the Meeting was to increase the amount
of authorized but unissued shares of Common Stock. When combined with the
heightened attraction of the Class A Common Stock due to its increased price,
which stemmed from the Reverse Stock Split, this increase in authorized shares
has made it possible for the Company to issue shares of its Common Stock to
settle a portion of its debts as well as to trade and barter for other assets.
See immediately below for additional information on the Company's acquisition of
other assets and settlement of debts.
Through the efforts of CFS, in Spring 1995 the Company was able to settle
debts with 14 of the Company's creditors. The terms typically offered by the
Company to its creditors involved the issuance of restricted shares of Common
Stock in the Company equal to 10% of the amount of each debt in exchange for the
creditors' complete discharge of such liabilities. In addition, the Company
settled the debts owed to two of its former officers and directors by issuing
restricted shares of its Common Stock. During 1995 the Company issued 377,570
restricted shares of the Class A Common Stock in exchange for the written
discharge of $336,543 in debt. This debt settlement campaign reduced the
Company's accounts payable from $1,030,592 on December 31, 1994, to $757,202 on
December 31, 1995. Although the Company is still attempting to settle its
existing liabilities, no assurances can be given that any additional debts will
be settled for a number of shares of Common Stock acceptable to the Company.
While the Company began searching for merger or acquisition candidates, it
became involved in the barter and trade industry. On March 1, 1995, the Company
appointed Richard Lifschutz ("Lifschutz") as the Company's president and a
director. Lifschutz is very experienced in the barter industry and has been an
ITEX broker for many years. (ITEX is America's largest barter exchange.) Soon
after the arrival of Lifschutz, the Company began trading its publicly-traded
Class A Common Stock for other tangible assets such as media and trade credits,
including the following:
<PAGE>
- the purchase of $500,000 worth of media credits on July 31, 1995, from
Associated Reciprocal Traders ("ART"), a British Virgin Island corporation,
in exchange for 500,000 restricted shares of the Company's Class A Common
Stock. The media credits are valued at $125,000 on the Company's balance
sheet for the year ended December 31, 1995.
- the sale of 200,000 shares of its Class A restricted Common Stock,
effective July 11, 1995, to ITEX Corporation, a New Jersey corporation, in
exchange for 100,000 ITEX Trade Dollars which can be used on the ITEX
Barter Exchange to acquire a variety of goods and services. The ITEX trade
credits are valued at $48,466 on the Company's Balance Sheet for the year
ended December 31, 1995.
On March 1, 1995, the Company entered into two Consulting Agreements, one
with Karston Electronics, Ltd., a corporation formed under the laws of the
British Virgin Islands ("Karston"), and the other with East-West Trading Corp.,
a corporation formed under the laws of the West Indies ("East-West"). The
Company retained East-West and Karston to assist the Company in general business
consulting. As compensation for these services, the Company issued to Karston
and East-West each 120,000 shares of its Class A Common Stock pursuant to
Regulation S of the Securities Act of 1933. The Company also granted both
Karston and East-West options to purchase up to 250,000 shares of the Company's
Common Stock at an exercise price of $0.50 per shares to be exercised no later
than August 4, 1996. All of these options have since expired worthless.
The Company entered into a Stock Exchange Agreement (see below for the
subsequent rescission of this Agreement) on December 8, 1995, by and between the
Company and AltaChem Group, Inc., a corporation formed under the laws of the
Republic of Ireland ("AltaChem") and the shareholders of AltaChem. AltaChem is a
chemical company that manufactures, distributes, and sells chemicals used in the
building industry, including a polyurethane foam product used as insulation,
sealants and caulking materials. The Stock Exchange Agreement provided for the
Company's acquisition of 100% of the issued and outstanding capital stock of
AltaChem in exchange for 21,623,996 shares of the Company's Class A Common
Stock, which equaled 75% of the issued and outstanding shares of Class A Common
Stock on September 1, 1995, the date of stock issuance.
On August 3, 1995 and in contemplation of the Stock Exchange Agreement with
AltaChem, the Company appointed Aster De Schrijver as the Company's chairman of
the board of directors, James Tilton as the Company's chief executive officer
and director, and Jane Zheng as the Company's secretary-treasurer and director.
Prior to the December 8, 1995 Stock Exchange Agreement, ADS Group, Ltd., an
entity controlled by Mr. De Schrijver, owned 100% of the capital stock of
AltaChem. As consideration for its transfer of the capital stock of AltaChem
stock, ADS Group received 18,740,796 shares of the Company's Common Stock. Mr.
Tilton received 2,883,200 shares of Common Stock as consideration for his
services rendered in negotiating the Stock Exchange Agreement. After the Stock
Exchange Agreement was consummated, Mr. De Schrijver and Mr. Tilton collectively
owned 75% of the Company's issued and outstanding Common Stock. Ms. Zheng is the
wife of Mr. Tilton. Upon the Company's respective appointments of De Schrijver,
Tilton and Zheng, Richard Surber and Mark Knudson resigned as the Company's
director.
On May 8, 1996, the parties to the AltaChem Stock Exchange Agreement
mutually agreed to rescind the Agreement ab initio, or from the beginning. For
more information on this rescission, see "Item 1-Description of Business."
Since the Stock Exchange Agreement was rescinded from the beginning, none
of the revenue earned by AltaChem during the 1995 fiscal year has been included
in the Company's income statement which is included herein. Moreover, pursuant
to the Rescission Agreement, each of the Parties released each other from any
and all claims stemming from the acquisition of AltaChem. Accordingly the
Company has no claims against AltaChem and believes it is not subject to any of
the claims of AltaChem.
Between September 1995 and February 1996, the Company entered into
transactions for the purchase of investment securities with OMAP Holdings
Incorporated, a Nevada corporation ("OMAP"), Tianrong Building Material
Holdings, Ltd., a Utah corporation ("TBMH"), and Eurotronics Holdings, Inc., a
Utah corporation ("Eurotronics"). At the time of these transactions, James
Tilton, Aster De Schrijver and Jane Zheng were officers and directors of the
Company. Tilton, De Schrijver, and Zheng were also officers and directors of
OMAP, TBMH, and Eurotronics. Accordingly, these Agreements were not negotiated
at arm's length, although the Company believes that they were valued and
executed pursuant to acceptable business practices.
<PAGE>
On September 28, 1995, Tianrong Building Material Holding, Ltd. purchased
40,000 shares of the Company's Class A Common Stock at $0.25 per share or an
aggregate amount of $10,000.
On December 20, 1995, the Company entered Stock Exchange Agreements with
OMAP, TBMH, and Eurotronics. The purpose of each Stock Exchange Agreement was to
transfer, in a tax-free exchange, $300,000 worth of the Company's Common Stock
to OMAP, TBMH and Eurotronics in exchange for $300,000 worth of common stock in
each of the three companies. All stock transferred pursuant to these Agreements
was restricted pursuant to Rule 144 under the Securities Act of 1933. The
Company issued 370,370 shares of Common Stock, valued at $0.81 per share, to
OMAP in exchange for 70,588 shares OMAP's common stock, valued at $4.25 per
share. The Company issued 370,370 shares of Common Stock, valued at $0.81 per
share, to TBMH in exchange for 319,149 shares of TBMH's common stock, valued at
$0.94 per share. Finally, the Company issued 370,370 shares of Common Stock,
valued at $0.81 per share, to Eurotronics in exchange for 566,038 shares of
Eurotronics' common stock, valued at $0.53 per share.
While the stock acquired pursuant to the three Stock Exchange Agreements
was valued at $300,000 for purposes of these transactions, the resale of all
shares that were acquired and issued by the Company was restricted. Moreover,
neither the Company, BRIA, TBMH, nor Eurotronics have securities which are
heavily traded on any stock market. Accordingly, for purposes of its audited
financial statements the Company has booked the OMAP common stock acquired
through the Exchange Agreement at $114,815, the TBMH common stock at $114,815,
and the Eurotronics common stock at $114,815.
On December 21, 1995, the Company sold an additional 290,323 shares of its
Common Stock, valued at $0.25 per share for purposes of the transaction, to OMAP
for $90,000. On January 15, 1996, the Company purchased 2,858 shares of OMAP for
$10,000, or $3.50 per share. On January 30, 1996, the Company purchased an
additional 6,154 shares of OMAP for $20,000, or $3.25 per share. Finally, on
February 9, 1996, the Company purchased 8,572 shares of OMAP for $30,000, or
$3.50 per share.
After the rescission of the AltaChem acquisition, the Company's new
management has focused the Company's business on acquiring and managing
operating subsidiaries.
On May 31, 1996, Aster De Schrijver resigned as the Company's chairman of
the board of directors and Jane Zheng resigned as the Company's secretary,
treasurer and director. On June 24, 1996, James Tilton resigned as the Company's
chief executive officer and director. These three officers and directors
resigned because the December 8, 1995 Stock Exchange Agreement pursuant to which
they acquired a controlling interest in the Company had been rescinded, leaving
the three individuals with no ownership interest in the Company. Neither De
Schrijver, Ms. Zheng, nor Mr. Tilton had any disagreements with the Company at
the time of their respective resignations.
The May 8, 1996 Rescission Agreement resulted in a change of control in the
Company's Common Stock. On June 27, 1996, Wendell Hall was appointed as the
Company's vice president and director. Also on June 27, 1996, Isaac Lifschutz
was appointed as the Company's secretary, treasurer and director. Isaac
Lifschutz is the son of Richard Lifschutz, the Company's president and director.
Kingslawn Offset, Inc., a New York corporation engaged in the printing of
full color catalogs, sales sheets, and other publications ("Kingslawn"), was
acquired by the Company on September 10, 1996. (See "Item 1 - Description of
Business" for more information on this acquisition.) The Company now actively
seeks to develop Kingslawn and its printing operations in its attempt to reach
profitability.
<PAGE>
The Company also acquired 90.1% of CyberFootball, Inc., a Nevada
corporation engaged in the development of an Internet virtual mall focused on
the sport of football ("CFI"), from CyberMalls, Inc., a Nevada corporation
wholly owned by CFS ("CyberMalls"), on August 31, 1996. The Internet virtual
mall owned by CFI is currently being developed by CyberMalls. CFI has granted a
$11.5 million promissory note to CyberMalls secured only by the Company's stock
in CFI. CFI has also agreed to pay CyberMalls various other forms of
compensation, but only upon the generation of revenues and profits. (See "Item 1
- - Description of Business, Business Development " for additional discussion on
the Agreements between CFI and CyberMalls.)
Results of Operations
Revenues for 1995 were $128 compared to $535,737 for 1994, a decrease of
$535,609. Costs of sales were zero for 1995 compared to $559,828 for 1994. The
sharp decline in both categories is due to the fact that the Company ceased all
active operations on or about June 1994 and has devoted all its efforts to
locating suitable merger/acquisition partners since then. In 1994, the Company
generated $327,734 in sales from Refractory Metals Division, $163,371 from
Intermet Resources Inc., and $44,632 from miscellaneous sales.
Selling, general and administrative expenses for 1995 decreased to $927,761
from $1,043,582 for 1994. The reduction was, again, due to the cessation of
active operations in 1994. In 1995, a majority of selling, general and
administrative expenses is attributable to the search for merger/acquisition
opportunities and the maintenance of the Company's status as a public company.
Interest expenses decreased to $4,155 in 1995 from $31,440 in 1994. $31,440
represents the accrued interest on the loan from Midlantic National Bank (MNB),
payroll taxes owed to Internal Revenue Service, and notes payables to two former
officers and directors. In August 1994, the Company repaid the debt owed to MNB
in full. In 1995, the Company accrued interest expenses on the notes payables to
former officers and directors in the amount of $4,155.
Loss before extraordinary items was $931,788 in 1995 compared to $1,099,113
in 1994.
In 1995, the Company incurred business acquisition costs related to the
merger with AltaChem in the amount of $137,215. Since the merger agreement was
rescinded in 1996, the expenses have been classified as an extraordinary item on
the Statements of Operations. For additional information on the rescinded merger
with Altachem, see "Item 1 - Description of Business."
The Company sustained a loss of $97,503 from disposition of assets in 1994
compared to zero for 1995. During 1994, the Company wound up its businesses and
many assets were liquidated at prices significantly below the original costs.
During the fiscal year 1995, the Company realized gain from debt settlement
with various creditors in the amount of $227,809. The Company issued 377,570
restricted shares of its Common Stock in exchange for the written discharge of
$336,543 in debt. In 1994 the Company's wholly owned subsidiaries had debt in
amount of $61,182 which was discharged in Chapter 7 bankruptcy filings.
The Company incurred a net loss of $841,194 for 1995 as compared to a net
loss of $1,135,434 for 1994. The substantial loss in 1994 was mainly
attributable to the Company's liquidation of operations. The net loss for 1995,
on the other hand, was primarily due to the fact that the Company incurred
significant expenses in locating suitable merger/acquisition candidates.
<PAGE>
Capital Resources and Liquidity
During 1994 and 1995, the Company settled a portion of its existing
liabilities and issued stock as a means to pay its creditors as well as
consultants and other professionals for various services rendered.
The deficiency in working capital of the Company decreased from $1,243,431
in 1994 to $873,536 in 1995. During 1995, the Company settled a portion of its
existing liabilities by issuing restricted shares of its Common Stock. As a
result, accounts payable decreased from $1,030,592 on December 31, 1994 to
$757,202 on December 31, 1995.
Net stockholders' deficit in the Company was $355,625 for 1995 as compared
to $1,201,718 in 1994. The improvement is due to the Company's issuance of
common stock to settle existing debts and compensate various consultants for
consulting services rendered.
On June 25, 1996, 1,000,000 shares of the Company's Class A Common Stock
was issued to Wilfried Martens for past consulting services and additional
consulting services to be performed in the future.
ITEM 7. FINANCIAL STATEMENTS
CONTENTS
Report of Andersen, Andersen & Strong..........................................2
Balance Sheet................................................................. 3
Statement of Operations........................................................4
Statements of Stockholder's Equity (Deficit)...................................5
Statements of Cash Flows.......................................................6
Notes to Financial Statements..................................................7
<PAGE>
ANDERSEN, ANDERSEN & STRONG, L.C.
Certified Public Accountants & Business Consultants
941 East 3300 South, Suite 202
Salt Lake City, Utah 84106
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
The Board of Directors and Stockholders of
BRIA Communications Corporation (Formerly
Metallurgical Industries, Inc. and Subsidiaries)
We have audited the balance sheet of BRIA Communications Corporation (formerly
Metallurgical Industries, Inc. and subsidiaries) as of December 31, 1995 and the
related statements of operations, stockholders' equity (deficit),and cash flows
for the years ended December 31, 1995 and 1994. These financial statements are
the responsibility of the Company's management.
Our responsibility is to express an opinion on these financial statements based
on our audit.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.
In our opinion the financial statements referred to above present fairly, in all
material respects, the financial position of BRIA Communications Corporation as
of December 31, 1995 and the results of its operations and its cash flows for
the years ended December 31, 1995 and 1994, in conformity with generally
accepted accounting principles.
The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As discussed in Note 1 to the
financial statements, the Company has suffered recurring losses from operations
and has a net capital deficiency. Those conditions raise substantial doubt about
the Company's ability to continue as a going concern. The financial statements
do not include any adjustments that might result from the outcome of this
uncertainty.
/S/Anderson, Anderson & Strong
- ------------------------------
Salt Lake City, Utah
September 27, 1996
F-2
<TABLE>
<CAPTION>
BRIA COMMUNICATIONS CORPORATION
(Formerly Metallurgical Industries, Inc. and Subsidiaries)
BALANCE SHEETS
DECEMBER 31, 1995 AND 1994
ASSETS
CURRENT ASSETS:
<S> <C>
Cash ...................................................... $ 82,398
Accounts receivable ....................................... 239
Total Current Assets .................................... 82,637
OTHER ASSETS:
Investments - securities (Note 2) ......................... 344,445
Media and other credits ................................... 173,466
Total Other Assets ..................................... 517,911
$600,548
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
CURRENT LIABILITIES:
<S> <C>
Notes payable - officers and directors (Note 3) ........ $ 63,465
Accounts payable ....................................... 757,202
Other current liabilities .............................. 135,506
Total Current Liabilities ............................ 956,173
STOCKHOLDERS' EQUITY (DEFICIT):
Common stock:
Class A, $.001 par value; shares authorized,
200,000,000; shares issued and outstanding, 6,798,186 6,798
Class B $.001 par value; shares authorized, 220,000;
shares issued and outstanding, 213,440 (convertible
into Class A shares) ................................ 213
Capital in excess of par value ......................... 7,054,544
Accumulated deficit ..................................( 7,417,180)
Total stockholders' Equity (Deficit) ...............( 355,625)
$ 600,548
</TABLE>
See accompanying notes to consolidated financial statements.
F-3
<PAGE>
<TABLE>
<CAPTION>
BRIA COMMUNICATIONS CORPORATION
(Formerly Metallurgical Industries, Inc. and Subsidiaries)
STATEMENTS OF OPERATIONS
YEARS ENDED DECEMBER 31, 1995 AND 1994
1995 1994
<S> <C> <C>
REVENUE .............................. $ 128 $ 535,737
------------ ------------
COST AND EXPENSES:
Cost of sales ...................... -- 559,828
Selling, general and administrative 927,761 1,043,582
Interest ........................... 4,155 31,440
------------ ------------
931,916 1,634,850
------------ ------------
LOSS BEFORE EXTRAORDINARY ITEMS ......( 931,788) ( 1,099,113)
EXTRAORDINARY ITEMS:
Business acquisition costs (Note 12)( 137,215) --
Loss on disposition of assets ...... -- ( 97,503)
Gain from debt settlement (Note 4) . 227,809 61,182
------------ -------------
90,594 ( 36,321)
------------ -------------
NET LOSS ............................. $ (841,194) $(1,135,434)
============ =============
NET LOSS PER COMMON SHARE:
(Loss) before extroardinary items .. $ (0.21) (3.98)
Extraordinary items ................ 0.02 (0.14)
------------ --------
Net (loss) per common share ........ $ (0.19) (4.12)
============= ========
Weighted average number of common
shares outstanding ................ 4,550,229 276,140
============= =========
</TABLE>
See accompanying notes to consolidated financial statements.
F-4
<PAGE>
<TABLE>
<CAPTION>
BRIA COMMUNICATIONS CORPORATION
(Formerly Metallurgical Industires, Inc. and Subsidiaries)
STATEMENTS OF STOCKHOLDERS' EQUITY (Deficit)
YEARS ENDED DECEMBER 31, 1995 AND 1994
Capital
Class A Class A Class B Class B In Excess Accumulated
Shares Amount Shares Amount Of Par Deficit
<S> <C> <C> <C> <C> <C> <C>
BALANCE, December 31, 1993 ................... 3,622,654 $ 362,265 98,440 $ 9,844 $ 4,318,250 $(5,440,552)
Exercise of stock options for services ..... 4,487,800 448,780 -- -- 216,194 --
Additional shares issued for services ...... 189,346 18,935 -- -- -- --
Net loss for the year ...................... -- -- -- -- -- (1,135,434)
BALANCE, December 31, 1994 ................... 8,299,800 829,980 98,440 9,844 4,534,444 (6,575,986)
Reverse stock split - 1 for 40 ............. ( 8,092,301) ( 809,230) -- -- 809,230 --
Reduction in par value from $.10 to $.001 .. -- ( 20,542) -- ( 9,746) 30,288 --
Shares issued for cash ..................... 350,323 350 -- -- 104,650 --
Additional shares issued for debt settlement 425,070 425 -- -- 126,621 --
Additional shares issued for services ...... 3,984,184 3,984 -- -- 931,812 --
Additional shares issued for investments ... 1,111,110 1,111 -- -- 343,334 --
Additional shares issued for other assets .. 700,000 700 -- -- 174,300 --
Shares issued - no consideration ........... 20,000 20 115,000 115 ( 135) --
Net loss for the year ...................... -- -- -- -- -- ( 841,194)
---------- -------- ------- ------- ------ -----------
BALANCE, December 31, 1995 ................... 6,798,186 $ 6,798 213,440 $ 213 $ 7,054,544 (7,417,180)
========== ======== ======= ======== ====== ===========
</TABLE>
See accompanying notes to consolidated financial statements.
F-5
<PAGE>
<TABLE>
<CAPTION>
BRIA COMMUNICATIONS CORPORATION
(Formerly Metallurgical Industries, Inc. and Subsidiaries)
STATEMENTS OF CASH FLOWS
YEARS ENDED DECEMBER 31, 1995 AND 1994
1995 1994
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss ................................................... $ (841,194) $(1,135,434)
Adjustments to reconcile net loss to net cash
provided by operting activities:
Depreciation and amortization .............................. -- 16,595
Common stock issued for services ........................... 935,796 683,909
Loss on disposal of property ............................... -- 97,503
Gain from Debt settlement .................................. ( 227,809) ( 61,182)
(Increase) decrease in accounts receivable ................. ( 239) 291,221
(Increase) decrease in inventories ......................... -- 482,089
(Increase) decrease in other assets ........................ 43,247 6,664
Increase (decrease) in accounts payable .................... 68,928 ( 154,899)
Increase (decrease) in accrued liabilities ................. ( 1,497) ( 55,161)
Total adjustments .......................................... 818,426 1,306,739
Net cash provided (used) by operating activities ............. ( 22,768) 171,305
CASH FLOWS FROM INVESTING ACTIVITIES:
Cash proceeds from the sale of property .................... -- 232,957
Net cash provided by investing activities .................. -- 232,957
CASH FLOWS FROM FINANCING ACTIVITIES:
Sales of common stock for cash ............................. 105,000 --
Principal payments on capital leases ....................... -- ( 26,447)
Principal payments on long-term debt ....................... -- ( 297,130)
Repayment of loans to officers and directors ............... -- ( 86,525)
Net cash provided (used) by financing activities ........... 105,000 ( 410,102)
NET INCREASE (DECREASE) IN CASH .............................. 82,232 ( 5,840)
Cash, beginning .............................................. 166 6,006
Cash, ending ................................................. $ 82,398 $ 166
SUPPLEMENTAL DISCLOSURES:
Interest expense ........................................... $ 4,155 $ 31,441
Non cash financing activities:
Issuance of common stock for services ..................... $ 935,796 $ 683,909
Issuance of common stock for debt ......................... $ 127,046 --
Issuance of common stock for investments .................. $ 344,445 --
Issuance of common stock for other assets ................. $ 175,000 --
</TABLE>
See accompanying notes to consoldiated financial statements.
F-6
<PAGE>
BRIA COMMUNICATIONS CORPORATION
(Formerly Metallurgical Industries, Inc. and Subsidiaries)
NOTES TO FINANCIAL STATEMENTS
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Principles of Consolidation
The financial statements for the year ended December 31, 1994 include the
accounts of Bria Communications Corporation (formerly Metallurgical Industries,
Inc.) and its wholly-owned subsidiaries, Intermet Resources, Inc. and Advanced
Welding & Coating Services, Inc. (collectively, the Company). Investment in a
joint venture, owned 50% by the Company, was accounted for by the equity method
and is included in the accompanying statement of operations for the year ended
December 31, 1994. All significant intercompany transactions have been
eliminated. Since the Company's wholly-owned subsidiaries were dissolved during
1994 through chapter 7 bankruptcies, no accounts of subsidiaries are included in
the 1995 financial statements.
Nature of Business
The Company is located in the United States and previously marketed various
powdered metals which it either processed or sold without processing. The
Company ceased all active operations on June 30, 1994. Since then the Company's
activity has been largely restricted to maintaining its corporate legal status,
negotiating creditor settlements and searching for mergers or acquisitions.
Taxes on Income
Effective January 1, 1993 the Company adopted Statement of Financial Accounting
Standards No. 109, Accounting for Income taxes. The cumulative effect of the
change in accounting principle is immaterial.
Net Income Per Share
Net income per share is based on the average number of shares outstanding during
each year retroactively adjusted to give effect to all stock splits.
Basis of Financial Statement Presentation
The Company's financial statements have been presented on the basis that it is a
going concern, which contemplates the realization of assets and satisfaction of
liabilities in the normal course of business. The Company incurred losses before
extraordinary items of $931,788 in 1995, and $1,099,113 in 1994. At December 31,
1995, the Company's current liabilities exceeded its current assets by $873,536,
and the stockholders equity reflects a deficit of $355,625. The Company's
continued existence is dependent on its ability to generate sufficient cash flow
to cover operating expenses, settle its obligations and develop an active
business.
F-7
<PAGE>
BRIA COMMUNICATIONS CORPORATION
(Formerly Metallurgical Industries, Inc. and Subsidiaries)
NOTES TO FINANCIAL STATEMENTS (Continued)
NOTE 2 - INVESTMENT SECURITIES
Company Shares Amount
Tianrong Building 319,149 $114,815
OMAP 70,588 114,815
Eurotronics 566,038 114,815
--------
$344,445
========
Investments in equity securities that have readily determinable fair values are
stated at their market value in accordance with Financial Accounting Standards
("FAS") No. 115. None of the above securities meets the specified requirement of
FAS No. 115. Valuation of other equity security investments is based on
acquisition costs. Markdowns are made to reflect significant permanent
impairment in values.
NOTE 3 - NOTES PAYABLE - OFFICERS AND DIRECTORS
Notes payable to officers and directors consists of the following:
December 31,
1995
Note payable, with interest at 8% $44,640
Note payable, with interest at 8.5% 18,825
--------
$63,465
========
At December 31, 1995 the above notes payable to officers and directors were in
default.
NOTE 4 - GAIN FROM DEBT SETTLEMENT
During 1995, the Company settled debts largely through the issuance of Class A
common stock resulting in a gain of $227,809.
The Company's wholly-owned subsidiaries had debt in the amount of $61,182 which
was discharged in 1994 through Chapter 7 bankruptcy filings. This amount is
reflected in the statements of operations as a gain from settlement of debt
during the year ended December 31, 1994.
F-8
<PAGE>
<TABLE>
<CAPTION>
BRIA COMMUNICATIONS CORPORATION
(Formerly Metallurgical Industries, Inc. and Subsidiaries)
NOTES TO FINANCIAL STATEMENTS (Continued)
NOTE 5 - STOCK OPTIONS AND WARRANTS
No options relating to the Company's 1989 stock option plan were exercised
during 1994, and the outstanding options expired on March 22, 1994.
On September 8, 1993, the Company adopted its 1993 stock option plan. Pursuant
to the plan, the Board of Directors of the Company can issue options to purchase
up to 2,587,800 shares of the Class A common stock over a 10 year period. All
options under the plan are non-qualified stock options. The exercise price of
options granted was based on the average of the closing bid/asked prices for the
common stock over the 20 day trading period immediately prior to the grant or
upon the bid price on the date of the grant.
On February 11, 1994, the Company adopted its 1994 stock option plan. Pursuant
to the plan, the Board of Directors of the Company can issue options to purchase
up to 3,300,000 shares of the Class A common stock over a 10 year period. All
options under the plan are non-qualified stock options. The exercise price of
options granted was based on the average of the closing bid/asked prices for the
common stock over the 20 day trading period immediately prior to the grant or
upon the bid price on the date of the grant.
During 1995, the Company granted Karston Electronics, Ltd. and East-West Trading
Corp. both options to purchase 250,000 of its Class A common stock at $.50 per
share. The options expire in August, 1996.
During 1995, the Company granted its president, Richard Lifschutz, options to
purchase 5,000 shares per month of its Class A common stock at $.50 for 12
months ending in February, 1996 (60,000 shares). The options expire in March,
1996.
Activity under the Company's plans was as follows:
Number of Option
Shares Price per share
<S> <C> <C>
Outstanding at December 31, 1993 ..... 1,226,900 $.10 - $8.50
Granted ........................... 3,300,000 .10 - .25
Exercised ......................... (4,487,800) .10 - .25
Cancelled ......................... ( 39,100)
----------
Outstanding at December 31, 1994 ..... --
Granted ........................... 560,000 $ .50
Exercised (see Note 12) ........... --
----------
Outstanding at December 31, 1995 ..... 560,000
==========
</TABLE>
F-9
<PAGE>
BRIA COMMUNICATIONS CORPORATION
(Formerly Metallurgical Industries, Inc. and Subsidiaries)
NOTES TO FINANCIAL STATEMENTS (Continued)
NOTE 6 - COMMON STOCK
During 1995, the Board of Directors approved a 1 for 40 reverse stock split of
the Class A common stock, and an increase in the authorized number of shares of
Class A common stock from 10,000,000 to 200,000,000 shares. A 1995 Special
Meeting of Shareholders approved a reduction in the par value per share of Class
A and Class B common stock from $.10 to $.001.
The details of the Company's Common Stock at December 31, 1995 are as follows:
Number of Shares
Class A, $.001 par value:
Authorized 200,000,000
Issued and outstanding 6,798,186
Class B, $.001 par value:
Authorized 220,000
Issued and outstanding 213,440
Class B shares are convertible into Class A shares on a one-for-one basis and
each class has the same rights and privileges with the exception of voting.
Pursuant to a 1966 stock purchase contract, the Company agreed not to issue
additional shares of Class A or B stock as long as a certain major stockholder
owns a minimum of 57,000 shares of Class A Common Stock. This restriction does
not include the issuance of Class A Common Stock for (l) property, (2) options
and warrants, (3) conversion of Class B shares. However in the event of a public
or private offering, the major Class A stockholder is entitled to purchase its
pro-rata share of such placement at the offering price.
NOTE 7 - INCOME TAXES
At December 31, 1995, the Company had a net operating loss (NOL) carryforward
totaling approximately $2,900,000 that may be offset against future taxable
income in varying amounts through 2010. In addition, the Company has certain tax
credit carryforwards of approximately $131,000 which expire in varying amounts
between 2000 and 2005. The Company has approximately $7,000,000 of capital loss
carryover that expires in 1999. Loss carryovers of approximately $6,500,000 and
tax credits of Approximately $122,000 were lost during 1994 when the Company's
subsidiaries were dissolved pursuant to Chapter 7 bankruptcy. No benefit has
been reported in the financial statements, however, because the Company believes
there is at least a 50% chance that the carryforwards will expire unused.
F-10
<PAGE>
BRIA COMMUNICATIONS CORPORATION
(Formerly Metallurgical Industries, Inc. and Subsidiaries)
NOTES TO FINANCIAL STATEMENTS (Continued)
NOTE 7 - INCOME TAXES (Continued)
Accordingly, the tax benefit of the loss carryforward has been offset by a
valuation allowance of the same amount. The expected tax benefit resulting from
applying federal statutory tax rates to the pretax loss differs from amounts
reported in the financial statements because of the increase in valuation
allowance. Certain provisions of the tax law may limit the net operating loss,
capital loss and credit carryovers in the event of a significant change in
ownership of the Company.
NOTE 8 - PROFIT SHARING PLANS
The Company's profit-sharing plan and 401K plan were terminated and the assets
were distributed in 1995 and 1994 to the entitled beneficiaries. The Company
made no employer contributions to the plans in 1995 or 1994.
NOTE 9 - COMMITMENTS AND CONTINGENCIES
The Company leased manufacturing, storage and office facilities under an
operating lease. The lease agreement stated that tenancy was from month to month
after December 31, 1993, terminable by either party on 30 days prior notice but
no later than March 31, 1994. The Company was evicted on or about March 31,
1994. The Company believes that additional charges after that date are not
justified according to the terms of the lease agreement. The landlord has billed
the Company for a variety of charges since that date resulting in a disagreement
over the amount owed by the Company. As of December 31, 1994, the Company has
recorded an obligation of $354,711 as compared to the landlord's claim of
$945,344, resulting in an amount in dispute of approximately $590,633. This
disputed amount does not appear as an obligation on the Company's financial
statements. No law suits have been filed to date regarding the disputed amount,
however, the landlord received a judgment in its favor in 1993 in the amount of
$351,005 representing the Company's obligation at September 24, 1993. The
Company believes that the possibility of an unfavorable outcome regarding this
disputed amount is reasonably possible but not probable.
Additionally, the Company is obligated under its lease agreement to reimburse
the landlord for all costs of environmental clean-up. The Company executed two
security agreements with the landlord as the secured party for the costs of
clean-up. The first $100,000 is subordinate only to the security interest of the
bank debt, if any, taxes owed to Internal Revenue Service, and State of New
Jersey taxes. Any liability in excess of $100,000 is secured but subordinate to
the security interest of the same entities plus that of Ira and Lawrence
Friedman. The Company had insurance policies which it believes should cover
approximately $100,000 of the clean-up costs. The Company cannot determine at
this time what impact, if any, this matter will ultimately have on its financial
position.
F-11
<PAGE>
BRIA COMMUNICATIONS CORPORATION
(Formerly Metallurgical Industries, Inc. and Subsidiaries)
NOTES TO FINANCIAL STATEMENTS (Continued)
NOTE 9 - COMMITMENTS AND CONTINGENCIES (Continued)
On May 16, 1995, the Company entered into a one year Consulting Agreement with
Canton Financial Services Corporation (CFSC), a wholly-owned subsidiary of
CyberAmerica Corporation. The Company agreed to pay CFSC a monthly consulting
fee which is the greater of $20,000 or the actual fee for services provided by
CFSC's professional staff. The Company has the option of either paying in cash
or in shares of the Company's Class A common stock. The agreement was renewed on
April 1, 1996. The new agreement is for one year with automatic month-to-month
renewals thereafter until terminated upon 30 day notice by either party.
Richard Lifschutz, the Company's president and director, is compensated pursuant
to an agreement dated February 28, 1995. From February 1995 until June 1996 the
agreement provided for Mr. Lifschutz to receive 5,000 shares of the Company's
Class A common stock per month for services rendered as well as options to
purchase 5,000 additional shares per month at an option price of $.50 per share.
Options expire in June, 1996. On July 5, 1996, the agreement was amended to
provide for the monthly issuance of 10,000 shares per month.
NOTE 10 - BUSINESS SEGMENT DATA
In 1994, the Company's operations were conducted through two business segments:
specialty metals processing and advanced welding technology activities. These
segments and the primary operations of each are described below.
Information concerning this data is as follows: Loss from operations is total
revenue less operating expenses and state income taxes. Identifiable assets are
those assets used in the Company's operation for each segment.
December 31,
1995 1994
REVENUE:
Specialty metals
processing $ - $ 535,681
Advanced welding
activities - -
--------- ---------
$ - $ 535,681
=========== =============
F-12
<PAGE>
<TABLE>
<CAPTION>
BRIA COMMUNICATIONS CORPORATION
(Formerly Metallurgical Industries, Inc. and Subsidiaries)
NOTES TO FINANCIAL STATEMENTS (Continued)
NOTE 10 - BUSINESS SEGMENT DATA (Continued)
1995 1994
LOSS FROM OPERATIONS:
OPERATING LOSSES:
<S> <C> <C>
Specialty metals
processing .............. $ -- $(1,062,413)
Advanced welding
activities .............. -- ( 5,316)
Interest expense .......... -- ( 31,440)
Other income ............. 56
------------ ------------
LOSS FROM OPERATIONS ....... $ -- $(1,099,113)
=========== ===========
IDENTIFIABLE ASSETS:
Specialty metals
processing .............. $ -- $ 41,879
Advances welding
activities .............. -- --
----------- -----------
$ -- $ 41,879
=========== ===========
CAPITAL SPENDING:
December 31,
1995 1994
------------------
<S> <C> <C>
Specialty metals
processing ............................ $ -- $ --
Advanced welding
activities ............................ -- --
------ -------
$$$$$$ $$$$$$$
====== =======
DEPRECIATION:
Specialty metals
processing ............................ $ -- $12,665
Advanced welding
Activities ............................ -- 3,930
------ -------
$ -- $16,595
====== =======
</TABLE>
For the year ended December 31, 1994, there were no individual customers who
accounted for sales of 10% or greater.
F-13
<PAGE>
BRIA COMMUNICATIONS CORPORATION
(Formerly Metallurgical Industries, Inc. and Subsidiaries)
NOTES TO FINANCIAL STATEMENTS
NOTE 11 - RELATED PARTY TRANSACTIONS
In December of 1994, the Company moved its offices from Tinton Falls, New Jersey
to the offices of Canton Financial Services Corporation (CFSC) in Salt Lake
City, Utah. CFSC is a wholly-owned subsidiary of CyberAmerica Corporation. Since
that time the Company has been party to successive agreements with CFSC whereby
CFSC provides management and consulting services. Until August, 1995, Richard D.
Surber was an officer or director of the Company. Mr. Surber is a shareholder of
the Company and also Chief Executive Officer and a director of CyberAmerica
Corporation. He is also president and a director of CFSC. See Note 9.
Richard Lifschutz, the Company's president is also a media and barter broker
with "ITEX" barter network. During 1995, the Company acquired media and barter
credits in exchange for shares of its Class A common stock. Mr. Lifschutz, as a
broker, negotiated the transactions. Mr. Lifschutz has a management contract
with the Company. See Note 9.
NOTE 12 - SUBSEQUENT EVENTS
On May 8, 1996, a Stock Exchange Agreement between the Company and AltaChem
Group was rescinded by all parties retroactive to its inception on December 8,
1995. Pursuant to the rescission agreement, all shares of common stock
previously exchanged are to be returned. On September 27, 1996, 18,749,796
shares of the Company's Class A common stock had not been returned. The Company
has notified its stock transfer agent that these shares are not outstanding and
are to be cancelled upon receipt of the certificate. Accordingly, a stop
transfer order has been placed on the shares by the agent. These shares are not
included in the total of outstanding shares in the financial statements. Direct
costs associated with this business acquisition effort in the amount of $137,215
appear in the statements of operations as an extraordinary item.
The Company's consulting agreement with Canton Financial Services Corporation
was renewed on April 1, 1996. The new agreement is for one year with automatic
month-to-month renewals thereafter until terminated upon 30 day notice by either
party. See Notes 9 and 11.
The Company's agreement with its president was amended on July 5, 1996. See Note
9.
None of the options outstanding on December 31, 1995 was exercised prior to the
expiration dates in March and August of 1996. See Note 5.
F-14
<PAGE>
ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
On January 11, 1995, the Company relieved its independent accountant,
Broza, Block & Rubino ("Broza") of its duties. Broza had been the Company's
independent accountant for over ten years. The Company filed a Form 8-K on
January 16, 1995, and a Form 8-K/A on February 6, 1995 and also on March 8,
1995. The February 6, 1995 Form 8-K/A was filed to respond to Rule 304(a)(1)(iv)
of Regulation S-B which was not done in the January 16, 1995 report. The March
8, 1995 Form 8-K/A was filed because the Company had then just received Broza's
response to the original Form 8-K.
Neither of Broza's reports on the financial statements for the two years
prior to Broza's discharge contained an adverse opinion or disclaimer of
opinion, or was modified as to uncertainty, audit scope or accounting
principles. However, the financial statements included in the Company's 1993
10-KSB report, prepared by Broza, included a single sentence expressing its
doubt as to the Company's ability to continue as a going concern.
The decision to change accountants was recommended by the board of
directors and stemmed from a change in the Company's headquarters, which were
moved from Shrewsbury, New Jersey to Salt Lake City, Utah. The board of
directors believed that the vast distance between the Company and Broza made
continuation of the relationship logistically and financially impractical. There
were no disagreements between Broza and the Company on any matter of accounting
principles, financial statement disclosure or auditing scope or procedure during
the two most recent fiscal years and subsequent period.
In January 1995, the Company reached an agreement to have Michael L. Roper,
CPA, become its independent auditor for the fiscal year ending December 31,
1994. Included in the proxy material relating to the March 14, 1995 Special
Meeting was a proposal asking for shareholder ratification of this selection.
However, after the definitive proxy material was distributed to shareholders and
before the Special Meeting, the Company decided against utilizing Mr. Roper's
accounting and auditing skills and therefore never formally engaged Mr. Roper as
its independent auditor.
A new independent auditor, Andersen, Andersen & Strong, was retained by the
Company on August 28, 1995 to perform the Company's audit for the fiscal year
ending December 31, 1994. Andersen, Andersen, & Strong also conducted the audit
for the fiscal year ending December 31, 1995 which accompanies this report.
There were no consultations with the newly engaged accountant during the last
two fiscal years or subsequent interim period regarding any of the information
in Item 304(a)(2)(i) or 304(a)(2)(ii).
PART III
ITEM 9. DIRECTORS, EXECUTIVE OFFICERS AND CONTROL PERSONS; COMPLIANCE WITH
SECTION 16(a) OF THE EXCHANGE ACT
Directors, Executive Officers and Control Persons
Name Age Position(s) and Office(s)
Richard Lifschutz 49 Director, President
Isaac Lifschutz 24 Director, Secretary, Treasurer
Wendell Hall 62 Director, Vice-President
<PAGE>
Richard Lifschutz works as a business consultant in several industries and
was appointed the Company's president and one of its directors on March 1, 1995.
During the last five years, Mr. Lifschutz has been involved with Lev-Ari
Communications in public relations, advertising and film and video production.
Additionally, Mr. Lifschutz has been a media and barter broker for approximately
the last three years on the "ITEX" barter network. Mr. Lifschutz is a member of
the Screen Actors Guild and also works as a consultant to movie production
companies and has appeared in several productions as an actor.
Wendell Hall works as a practicing dentist. Mr. Hall has been a dentist for
the past 30 years and was appointed as the Company's vice-president and director
on June 27, 1996. Mr. Hall earned an engineering degree from the University of
Florida and a dental degree from Mehary Medical College, he also lives and works
in Tampa, Florida.
Isaac Lifschutz was appointed as treasurer, secretary and director on June
27, 1996. He is the son of Richard Lifschutz, the Company's president and
director. Mr. Lifschutz is a student attending Yeshiva University receiving a
Rabbinical Ordination. Mr. Lifschutz has been attending school for most of his
adult life and is preparing to go to law school in the near future.
Compliance with Section 16(a) of the Exchange Act
The Company is aware that Richard Lifschutz, the Company's chief executive
officer and one of its directors, failed to timely file Form 4 as required by
Section 16(a) of the Securities Exchange Act of 1934 for the 116,713 restricted
shares of Common Stock he has acquired since March 1, 1995. Isaac Lifschutz, the
Company's, treasurer, secretary and one of its directors has not filed Form 3 as
required to have been filed within 10 days of his June 27, 1996 appointment as
the Company's officer and director pursuant to Section 16(a) and Section 23(a)
of the Securities Exchange Act of 1934. The Company is also aware that Wendell
Hall, the Company's vice-president and one of its directors, has failed to file
a Form 3 as required to have been filed within 10 days of his June 27, 1996
appointment as the Company's officer and director, pursuant to Section 16(a) and
Section 23(a) of the Securities Exchange Act of 1934.
However, the Company is having these documents prepared to be filed.
ITEM 10. EXECUTIVE COMPENSATION
Executive Compensation
No compensation in excess of $100,000 was awarded to, earned by, or paid to
any executive officer of the Company during the 1994 fiscal year.
The following table provides summary information for each of the last three
fiscal years concerning cash and non-cash compensation paid or accrued by the
Company to or on behalf of: Ira Friedman, who, until his resignation in December
1994, had served as the president and chief executive officer of the Company
since 1972 and a director since 1967; James Tilton who served as the Company's
chief executive officer from August 1995 to June 1996; and Richard Lifschutz,
the Company's current president.
<PAGE>
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
Long Term Compensation
Annual Compensation
Payouts Awards
Other
Name and Annual Restricted Securities All Other
Principal Compen- Stock Underlying LTIP Compen-
Position Year Salary($) Bonus($) sation($) Award(s)($) Options/SARs(#) Payouts sations($)
- -------- ---- --------- -------- ---------- ----------- --------------- ------- ------------
<C> <C> <C> <C> <C> <C> <C> <C> <C>
Richard
Lifschutz 1996 0 0 0 8,992 0 0 0
Current 1995 0 0 0 22,348(2) 0 0 0
President
James
Tilton 1995 0 0 0 0 0 0 0
Former
CEO
Ira
Friedman 1994 100,000(3) 0 0 0 0 0 0
Former
CEO 1993 85,157 0 0 0 0 0 0
</TABLE>
COMPENSATION OF DIRECTORS
Directors are not precluded from serving in any other capacity as an
officer, agent, employee, or otherwise, and receiving compensation therefore.
The following paragraphs describe the compensation earned by officers of the
Company who concurrently serve as the Company's directors.
Richard Lifschutz, the Company's president and director, is compensated
pursuant to a Letter of Agreement dated February 28, 1995. From February 1995
until June 1996, this Agreement provided for Mr. Lifschutz to receive 5,000
restricted shares of Common Stock per month for services rendered as the
Company's president, as well as options to purchase 5,000 additional shares per
month at an option price of $0.50 per share. However, on March 1, 1996 Mr.
Lifschutz's entitlement to purchase options expired with an option to purchase a
total of 47,500 options expiring worthless. On July 5, 1996, the Agreement was
amended to provide for the monthly issuance of 10,000 restricted shares to Mr.
Lifschutz. The Agreement also entitles Mr. Lifschutz to receive additional
compensation, as a finder's fee, for business opportunities that Mr. Lifschutz
introduces to the Company. Mr. Lifschutz's finder's fee is to be paid at his
election of five percent (5%) in like kind assets received by the Company or
shares of Common Stock provided that the total number of shares does not exceed
nine percent (9%) of the total issued and outstanding shares of the Company. As
of September 27, 1996, Mr. Lifschutz or his designees has been issued a total of
141,713 restricted shares of the Company's Common Stock pursuant to the March 1,
1995 Agreement.
- -------------------------
(2)Pursuant to the terms of the Letter Agreement, Mr. Lifscutz received
5,000 shares of restricted Common Stock per month for his services as the
Company's president until August 1996. Beginning August 1996, Mr. Lifschutz
receives 10,000 shares of restricted Common Stock per month valued at the
average bid and ask prices of the 10 days preceding the dates of issuance. The
Company discounts the shares an additional 75% to account for the fact that
these shares are restricted, pursuant to Rule 144.
(3)Mr. Ira Friedman received the sum of $50,000 toward his annual salary.
<PAGE>
<TABLE>
<CAPTION>
Wendell Hall, the Company's vice-president and director, receives a
monthly salary of 5,000 restricted shares of the Company's Common Stock for
services rendered as vice-president. This compensation is paid pursuant to a
July 5, 1996 resolution of the board of directors. Mr. Hall's shares are
calculated at the average of the bid and ask prices of the free trading Common
Stock for the 10 days preceding the dates of issuance. The Company discounts an
additional 75% of the value of all shares of its issued Common Stock,
restricted, pursuant to Rule 144 of the Securities Act of 1933. As of September
27, 1996, Mr. Hall has accrued 10,000 shares of restricted Common Stock.
Isaac Lifschutz, the Company's secretary-treasurer and director, also
receives a monthly salary of 5,000 restricted shares of the Company's Common
Stock for services rendered as secretary-treasurer. This compensation is paid
pursuant to a July 5, 1996 resolution of the board of directors. Mr. Lifschutz's
shares are calculated at the average of the bid and ask prices of the free
trading Common Stock for the 10 days preceding the dates of issuance. The
Company discounts an additional 75% of the value of all shares of its issued
Common Stock, restricted pursuant to Rule 144 of the Securities Act of 1933. As
of September 27, 1996, Mr. Hall has accrued 10,000 shares of restricted Common
Stock.
ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
On September 27, 1996, there were 8,377,914 shares of the Company's
Class A Common Stock, $0.001 par value, and 213,438 shares of its Class B Common
Stock, $0.001 par value, issued and outstanding. The Company's Class A Common
Stock is publicly traded on the OTC Bulletin Board. The Company's Class B Common
Stock is not publicly traded and is owned exclusively by the two entities listed
below. The following table sets forth information concerning the stock ownership
as of September 27, 1996, with respect to (i) each person who is known to the
Company to be the beneficial owner of more than 5 percent of each class of the
Company's Common Stock; (ii) all directors; (iii) each of the executive
officers; and (iv) directors and executive officers of the Company as a group
(for more information on the Company's Class A Common Stock and Class B Common
Stock, see "Item 5 - Market for Registrant's Common Equity and Related
Stockholder Matters"):
- ----------------------- ------------------------------------------------ -------------------------- -----------------
Name and Address Amount and Nature of Percent
Title of Class of Beneficial Owner Beneficial Ownership of Class
- ----------------------- ------------------------------------------------ -------------------------- -----------------
<S> <C> <C> <C>
Class A Common Stock Canton Financial Services Corporation 2,017,745 24.1%
268 West 400 South, Suite 300
Salt Lake City, UT 84101
- ----------------------- ------------------------------------------------ -------------------------- -----------------
Class A Common Stock ITEX Corporation 700,000 8.4%
10300 SW Greenburg Road, Suite 370
Portland, Oregon 97223
- ----------------------- ------------------------------------------------ -------------------------- -----------------
Class A Common Stock Wilfried Martens 1,000,000 11.9%
St. Amandusstraat 2B
9800 Deinze Belgium
- ----------------------- ------------------------------------------------ -------------------------- -----------------
Class A Common Stock OMAP Holdings Incorporated 660,693 7.9%
82-66 Austin Street
Kew Gardens, NY 11415
- ----------------------- ------------------------------------------------ -------------------------- -----------------
Class A Common Stock Tianrong Building Material Holdings, Ltd. 430,370 5.1%
82-66 Austin Street
Kew Gardens, NY 11415
- ----------------------- ------------------------------------------------ -------------------------- -----------------
Class A Common Stock A-Z Professional Consultants, Inc. 1,612,000 19.2%
268 West 400 South, Suite 300
Salt Lake City, UT 84101
- ----------------------- ------------------------------------------------ -------------------------- -----------------
OFFICERS AND DIRECTORS
- ----------------------- ------------------------------------------------ -------------------------- -----------------
Class A Common Stock Richard Lifschutz 116,713** 1.4%
147-17 Newport Avenue
Neponsit, NY 11964
- ----------------------- ------------------------------------------------ -------------------------- -----------------
Class A Common Stock Isaac Lifschutz 10,000 *
147-17 Newport Avenue
Newport, NY 11964
- ----------------------- ------------------------------------------------ -------------------------- -----------------
Class A Common Stock Wendell Hall 10,000 *
5519 Rawls Road
Tampa, Florida 33625
- ----------------------- ------------------------------------------------ -------------------------- -----------------
Class A Common Stock All Officers and Directors as a Group 136,713 1.6%
- ----------------------- ------------------------------------------------ -------------------------- -----------------
CLASS B Common Stock
- ----------------------- ------------------------------------------------ -------------------------- -----------------
Class B Common Stock Ira L. Friedman 98,438 46.1%
10 Bingham Hill Circle
Rumson, New Jersey 07760
- ----------------------- ------------------------------------------------ -------------------------- -----------------
Class B Common Stock Canton Financial Services Corp. 115,000 53.8%
268 West 400 South, Suite 300
Salt Lake City, UT 84101
- ----------------------- ------------------------------------------------ -------------------------- -----------------
</TABLE>
* Less than 1% of the outstanding Class A Common Stock.
** Richard Lifschutz is compensated for his services as the Company's
president pursuant to a March 1, 1996 Letter Agreement. The agreement originally
provided that Mr. Lifschutz receive 5,000 shares of restricted common stock each
month. On July 5, 1996 the Company amended the Letter Agreement to increase Mr.
Lifschutz's monthly salary to 10,000 restricted shares of Common Stock per
month. Mr. Lifschutz is also entitled to receive a finder's fee for transactions
to which he introduces the Company. The finder's fee paid to Mr. Lifschutz is
determined from time to time by the board of directors. As of September 27,
1996, Mr. Lifschutz or his designees have received 125,000 shares of Common
Stock as a result of his monthly compensation. Lifschutz received an additional
29,213 shares of Common Stock as a finder's fee for various transactions to
which Lifschutz has introduced the Company.
<PAGE>
Changes in Control
On May 31, 1996, Aster De Schrijver resigned as the Company's chairman of
the board of directors and Jane Zheng resigned as the Company's secretary,
treasurer and director. On June 24, 1996, James Tilton resigned as the Company's
chief executive officer and director. These three officers and directors
resigned because the December 8, 1995 Stock Exchange Agreement pursuant to which
they acquired a controlling interest in the Company had been rescinded, leaving
the three individuals with no ownership interest in the Company. The May 8, 1996
Rescission Agreement resulted in a change of control in the Company's Common
Stock. Neither De Schrijver, Ms. Zheng, nor Mr. Tilton had any disagreements
with the Company at the time of their respective resignations.
On June 27, 1996, Wendell Hall was appointed as the Company's vice
president and director. Also on June 27, 1996, Isaac Lifschutz was appointed as
the Company's secretary-treasurer and director. Isaac Lifschutz is the son of
Richard Lifschutz, the Company's president and director.
The Company knows of no arrangements which may result in a further change
of control or change in management of the Company.
ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Transactions Involving James Tilton, Jane Zheng, Aster De Schrijver &
AltaChem
In May 1995, the Company began negotiations with AltaChem Group, Inc.,
Ireland ("AltaChem") and the shareholders of AltaChem. To facilitate this
anticipated acquisition, the Company appointed Aster De Schrijver, James Tilton
and Jane Zheng as directors on August 3, 1995. At that time, Mr. De Schrijver
owned, directly or indirectly, 100% of the issued and outstanding capital stock
of AltaChem. James Tilton helped introduce the Company to AltaChem and performed
services related to the proposed acquisition. Jane Zheng is the wife of Mr.
Tilton. De Schrijver, Tilton, and Zheng were appointed as directors because of
their familiarity with the operations of AltaChem, and because of Mr. De
Schrijver's and Mr. Tilton's controlling interest in the capital stock of the
Company pursuant to any proposed transaction by and between the parties.
On December 8, 1995, the Company entered a Stock Exchange Agreement with
AltaChem, De Schrijver and Tilton. Pursuant to the Stock Exchange Agreement, the
Company acquired 100% of the capital stock of AltaChem. As consideration, the
Company issued 18,740,796 shares of Common Stock to Aster De Schrijver and
2,883,200 shares of Common Stock to James Tilton. The shares issued to Mr. De
Schrijver and Mr. Tilton constituted 75% of the issued and outstanding shares of
the Company's Common Stock.
The Stock Exchange Agreement required AltaChem to deliver audited financial
statements and a schedule of assets to the Company within 180 days. AltaChem
failed to provide these materials within the required time period, and indicated
to the Company that it was not capable of delivering the financial statements in
the immediate future. AltaChem also indicated that it was unsatisfied with
certain terms of the Stock Exchange Agreement. Accordingly, on May 8, 1996, the
parties to the Agreement signed a Rescission of Stock Exchange Agreement and
Release of All Claims (the "Rescission Agreement").
The Rescission Agreement unwound the Stock Exchange Agreement from the
beginning. Mr. De Schrijver and Mr. Tilton were required to return their shares
of Common Stock to the Company, and the Company was required to return
AltaChem's Common Stock. As of September 27, 1996 Mr. De Schrijver has not
returned all the shares issued pursuant to the original Stock Exchange
Agreement. These shares will be canceled upon receipt of the original stock
certificate. All parties to the Stock Exchange Agreement agreed to release each
other from all potential claims they may have had as a result of that Agreement.
As a result of the Rescission Agreement, the Company has no relationship to or
claims against AltaChem and AltaChem has no relationship to or in the Company's
opinion, claims against the Company.
These Agreements were related-party transactions. Aster De Schrijver, who
was chairman of the Company's board of directors when these transactions
occurred, was also the beneficial owner of AltaChem. Pursuant to the Stock
Exchange Agreement, De Schrijver acquired a quantity of shares of Common Stock
that gave him a controlling interest the Company. James Tilton, the Company's
director and chief executive officer, also acquired shares of Common Stock as a
result of the Stock Exchange Agreement. Neither Mr. De Schrijver nor Mr. Tilton
had any ownership interest in the Company aside from that provided in the Stock
Exchange Agreement, and therefore both had a material interest in seeing that
the Stock Exchange Agreement was effected. Ms. Zheng, the Company's former
secretary, treasurer and director, had an imputed material interest in the
Agreement as a result of her being Mr. Tilton's wife.
<PAGE>
On December 20, 1995, the Company entered Stock Exchange Agreements with
OMAP, TBMH, and Eurotronics. The purpose of each Stock Exchange Agreement was to
transfer, in a tax-free exchange, $300,000 worth of the Company's Common Stock
to OMAP, TBMH and Eurotronics in exchange for $300,000 worth of common stock in
each of the three companies. All stock transferred pursuant to these Agreements
was restricted pursuant to Rule 144. The Company issued 370,370 shares of Common
Stock, valued at $0.81 per share, to OMAP in exchange for 70,588 shares OMAP's
common stock, valued at $4.25 per share. The Company issued 370,370 shares of
Common Stock, valued at $0.81 per share, to TBMH in exchange for 319,149 shares
of TBMH's common stock, valued at $0.94 per share. Finally, the Company issued
370,370 shares of Common Stock, valued at $0.81 per share, to Eurotronics in
exchange for 566,038 shares of Eurotronics' common stock, valued at $0.53 per
share
OMAP Holdings
On December 20, 1995, the Company entered into a Stock Exchange Agreement
with OMAP Holdings, Incorporated, a Nevada corporation, ("OMAP"), pursuant to
which it acquired 70,588 shares of OMAP's Common Stock in exchange for the
Company's issuance of 370,370 shares of Common Stock. At the time of this
transaction, James Tilton, Aster De Schrijver and Jane Zheng were officers and
directors of both the Company and OMAP. The Company has valued the OMAP common
stock at $114,815.
On December 21, 1995, the Company sold an additional 290,323 shares of its
Common Stock, valued at $0.25 per share for purposes of the transaction, to OMAP
for $90,000. On January 15, 1996, the Company purchased 2,858 shares of OMAP for
$10,000, or $3.50 per share. On January 30, 1996, the Company purchased an
additional 6,154 shares of OMAP for $20,000, or $3.25 per share. Finally, on
February 9, 1996, the Company purchased 8,572 shares of OMAP for $30,000, or
$3.50 per share.
Tianrong Building Materials
On September 28, 1995 the Company entered an Agreement with Tianrong
Building Material Holdings, Ltd., a Utah corporation, ("TBMH"). Pursuant to the
terms of the Agreement the Company is obligated to issue 40,000 shares of the
Company's Common Stock, par value $0.001 per share to TBMH in a private
non-registered and nonexempt transaction at the purchase price of $.25 per share
for a total price of $10,000 cash.
Eurotronics Holdings Incorporated
On December 20, 1995, the Company entered an Agreement with Eurotronics
Holdings Incorporated ("Eurotronics"), a Utah corporation by which the Company
agreed to issue 370,370 restricted shares of its Common Stock, pursuant to Rule
144 of the Securities Act of 1933, par value $0.001 per share, in exchange for
the Company acquiring 566,038 restricted shares of stock, pursuant to Rule 144,
of Eurotronics Common Stock valued as of December 15, 1995 at $0.53 per share.
<PAGE>
Transactions Involving The Canton Industrial Corporation, A-Z Professional
Consultants and Richard Surber
Since January 1993, the Company has completed several transactions, as
detailed below, with Canton Industrial Corporation n/k/a CyberAmerica
Corporation, a Nevada corporation ("Canton"), and A-Z Professional Consultants,
Inc., a Utah corporation ("A-Z"). Richard D. Surber, the Company's president
from December 94 until August 1995, is the president and sole director of A-Z
and president and a director of Canton.
The Canton Industrial Corporation
On September 23, 1993, the Company signed a Stock Purchase Agreement
allowing Canton to exchange 11,823,006 restricted shares of Canton Common Stock
for 5,000,000 restricted shares of the Company's Class A Common Stock. The
Agreement required shareholder approval no later than December 3, 1993, which
was subsequently extended to December 10, 1993. No definitive contract was
signed and, on February 23, 1994, the Company withdrew the proxy it had filed
with the SEC regarding the reorganization with Canton.
Pursuant to the proposed stock exchange with Canton, the Company issued
options for approximately 5,587,000 shares, which were registered pursuant to
either the Company's 1993 Stock Option Plan or 1994 Stock Option Plan. These
options were granted to consultants who assisted the Company in restructuring
its business and helped locate suitable acquisition or merger candidates. The
consultants introduced the Company to several acquisition candidates, none of
which turned out to be suitable. As of March 31, 1994, options worth 1,728,000
shares had been exercised and by June 1, 1994, all of the options described
above had been exercised. Richard D. Surber was granted options worth a total of
690,000 shares between September 1, 1993 and February 28, 1994 (290,000 from the
1993 Option Plan and 400,000 from the 1994 Option Plan). Mark Wolfson, at the
time a consultant to Canton, was granted options worth 650,000 shares from the
1993 Option Plan. Mark Wolfson's brother is Allen Z. Wolfson, the sole
shareholder of A-Z Professional Consultants who also may be deemed to be a
"control person" of Canton, as that term is defined by rules and regulations
promulgated by the SEC. See this "Item 12 - Certain Relationships and Related
Transactions" for additional information on A-Z Professional Consultants and
Allen Wolfson. Mark Wolfson exercised options worth 300,000 shares on September
10, 1993 and the final options worth 350,000 shares on February 8, 1994.
On September 30, 1993, the Company entered into a real estate sales
agreement with Canton whereby the Company agreed to purchase from Canton certain
real estate in West Virginia for $1,506,174. The form of payment was two
$100,000 promissory notes signed by the Company, a promissory note in the amount
of $175,000 secured by a mortgage on the land, and 500,000 shares of the
Company's Class A Common Stock. A modifying addendum to the original agreement
dated February 7, 1994, allowed the Company to return the property if an
independent appraisal valued the real estate at less than $1,506,174. In the
event the property was returned, the Company was to receive shares of Canton's
stock equal in value to the $1,506,174. The addendum also modified the form of
the Company's payment of the purchase price to be equal to 1,142,000 shares of
this Company's Common Stock plus a promissory note for $375,000. The Company
subsequently notified Canton that it was dissatisfied with the appraisal and
elected not to take the real estate or shares of Canton stock equivalent to
$1,506,174 and thereby terminated the September 30, 1993 real estate sales
agreement and its February 7, 1994 addendum.
On May 16, 1995, the Company entered into a Consulting Agreement with
Canton Financial Services Corporation ("CFS"), a wholly-owned subsidiary of
Canton. Pursuant to the agreement, which had a one year term and has been
extended on a monthly basis, CFS would assist the Company in locating or forming
a public company for a potential merger or acquisition, restructuring the
Company's Common Stock, arranging for a public offering, and preparing
agreements, documents, filings and other material necessary to execute the above
services. The Company agreed to pay CFS a monthly consulting fee which shall be
the greater of: (a) $20,000 or (b) actual fee for services provided by CFS's
professional staff. The Company has the option of either paying in cash or the
issuance of the Company's Class A Common Stock. This agreement also provided for
CFS receiving a finder's fee upon the presentation of a suitable merger or
acquisition candidate. Pursuant to this consulting agreement, on July 31, 1995,
the Company issued 5% of its authorized but unissued Class A Common Stock, or
1,144,600 restricted shares, to CFS as a finder's fee for introducing the
Company to AltaChem.
<PAGE>
A-Z Professional Consultants, Inc. ("A-Z")
Richard Surber, the president and sole director of A-Z, is a director and
president of Canton. He is also the nephew of Allen Wolfson, the sole
shareholder of A-Z. Allen Wolfson may be deemed to be a "control person" of
Canton, as that term is defined by S.E.C. regulations.
In September 1993, A-Z sold the Company a second mortgage on property
located in Lee County (Ft. Myers), Florida, which was valued at $47,411.50, in
exchange for 189,646 restricted Class A shares of the Company's stock. In May
1994, the Company discovered that the property in question had been foreclosed
on by the first mortgagor in August 1993. The Company advised A-Z of this and
A-Z agreed to void the transaction and return the shares to the Company. The
shares were returned in May 1994.
Settlement Agreements Among Canton, A-Z, and the Company
As a result of some of the aforementioned agreements not being consummated
or not being performed as envisioned, several disputes arose among the Canton,
A-Z, and the Company. To avoid legal proceedings and settle all disputes, the
Company, A-Z, Canton, together with Ira L. Friedman, former president, chief
executive officer, and a director of the Company ("Friedman") and Richard T.
Johnson, formerly the chief financial officer, vice president of finance, and a
director of the Company ("Johnson"), executed a Settlement Agreement dated
December 16, 1994 (the "Settlement Agreement").
In consideration for the release by Canton and A-Z of the Company, Friedman
and Johnson from any and all claims, causes of action, and obligations relating
to the agreements, Friedman and Johnson appointed Richard D. Surber as president
and director of the Company and agreed to appoint two other persons to the
Company's board that Canton would nominate. The Settlement Agreement also
required the Company to issue 1.612 million shares of its Common Stock to
Canton. Canton subsequently assigned these shares to A-Z. The Settlement
Agreement also called for the resignations of all previous officers and
directors. These resignations temporarily left Mr. Surber as the Company's sole
director, until the appointments of Bobby G. Welch II and Christopher Swaner in
January 1995.
On March 3, 1995, Bobby Welch resigned as the Company's director. On March
30, 1995, Christopher Swaner also resigned as a director. Neither of the
resigning directors had any disagreements with the Company or its management at
the time of their respective resignations. On March 30, 1995 Mark Knudson was
appointed as a director of the Company.
In addition, as payment for past services rendered, the Company agreed to
issue Friedman, Johnson, and Lawrence Friedman 10% of the issued and outstanding
Class A Common Stock after any reverse stock split excluding any shares owned by
Friedman, Johnson, and Lawrence Friedman. The Company shall issue such shares as
follows: 4.9% to Friedman, 4.9% to Johnson, and 0.2% to Lawrence Friedman. The
shares were issued on April 1, 1995 when the number of issued and outstanding
Class A Common Stock was 186,008 (excluding shares owned by the three former
officers and directors). Consequently, Friedman and Johnson each received 91,144
shares and Lawrence Friedman received 3,720 shares.
By way of a Letter Agreement dated July 7, 1995, the parties to the
Settlement Agreement modified certain terms of December 1994 Settlement
Agreement to include, among other terms, the issuance of certain shares of the
Company's Common Stock to Messrs. Friedman and Johnson.
Immediately after Mr. Surber's December 16, 1994 appointment as president
and director of the Company, The Settlement Agreement stipulated that Canton
would be paid 1,612,000 restricted shares of the Company's Class A Common Stock
for the services it had rendered to that date and for services it would render
in completing the proxy statement for the Company's March 14, 1995 Special
Meeting of Shareholders.
<PAGE>
After this shareholder meeting concluded, Canton continued to provide
consulting services to the Company via its wholly owned subsidiary, Canton
Financial Services Corporation, a New Jersey corporation ("CFS"). These services
were formally retained pursuant to a Consulting Agreement dated May 16, 1995, as
discussed above. CFS has provided the Company with office space as well as
internal record keeping, the preparation of reports required to be filed with
SEC, the negotiation of settlement of the Company's debts, and the search for a
viable merger or acquisition candidate.
On March 24, 1995, the Company issued 115,000 shares of its Class B Common
Stock to CFS for substantial services Canton rendered in relation to the
shareholder meeting after the completion of the proxy statement on February 18,
1995, until March 24, 1995. On July 31, 1995, the Company issued 342,931 shares
of its Class A Common Stock to CFS for consulting fees owed. These two issuances
settled outstanding consulting fees from December 16, 1994, through July 31,
1995, for the amount of $171,466. As of December 31, 1995, CFS incurred $292,639
in consulting fees and miscellaneous expenses on behalf of the Company, of which
$32,766 is outstanding and due.
ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits. Exhibits required to be attached and filed by Item 601 of
Regulation S-B are listed in the Index to Exhibits on page 28 of this Form
10-KSB/A and are incorporated herein by this reference.
(b) Reports on Form 8-K. The Company did not file any reports on Form 8-K
during the period for which this report is being filed:
<PAGE>
SIGNATURES
In accordance with Section 13 or 15(d) of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized, this 3rd day of October 1996.
BRIA Communications Corp.
/S/ Richard Lifschutz
- ----------------------------
Richard Lifschutz, President
In accordance with the Exchange Act, this report has been signed below by
the following persons on behalf of the registrant and in the capacities and on
the dates indicated.
Signature Title Date
/s/Richard Lifschutz President and Director October 3, 1996
- ----------------------
Richard Lifschutz
/s/Isaac Lifschutz Secretary and Treasurer, Director October 3, 1996
- ----------------------
Isaac Lifschutz
/s/Wendell Hall Vice President, Director October 3, 1996
- ---------------------
Wendell Hall
<PAGE>
INDEX TO EXHIBITS
EXHIBIT PAGE
NO. NO. DESCRIPTION
3a * Certificate of Incorporation of the Company.
(Incorporated herein by reference from exhibit of like
number with the Company's Form 10-KSB for the year ended
December 31, 1988.)
3b * By-Laws of the Company. (Incorporated herein by
reference from exhibit of like number with the Company's
Form 10-KSB for the year ended December 31, 1988.)
4a * Warrant issued December 31, 1986 by the Company to
Mid-Monmouth Realty Associates. (Incorporated herein by
reference from exhibit of like number with the Company's
Form 10-KSB for the year ended December 31, 1988.)
10(i) * Exhibits
MATERIAL CONTRACTS
10(i)(a) * Letter of agreement dated March 1, 1995 between the
Company and Richard Lifschutz. (Incorporated herein by
reference from exhibit of like number from the Company's
Annual Report on Form 10-KSB filed by the Company on
December 28, 1995.)
10(i)(b) * Settlement Agreement dated December 16, 1994 between the
Company, Richard T. Johnson, Ira Freidman, A-Z
Professional Consultants and The Canton Industrial
Corporation. (Incorporated herein by reference from
Exhibit 10 to Current Report on Form 8-K filed by the
Company on March 11, 1994.)
10(i)(c) * Consulting Agreement dated August 4, 1995, but made
effective March 1, 1995, between the Company and
East-West Trading Corporation. (Incorporated herein by
reference from exhibit of like number from the Company's
Annual Report on Form 10-KSB filed by the Company on
December 28, 1995.)
10(i)(d) * Consulting Agreement dated August 4, 1995, but made
effective March 1, 1995, between the Company and Karston
Electronics, Ltd. (Incorporated herein by reference from
exhibit of like number from the Company's Annual Report
on Form 10-KSB filed by the Company on December 28,
1995.)
10(i)(e) * Consulting Agreement dated May 16, 1995, but made
effective February 18, 1995, between the Company and
Canton Financial Services Corporation. (Incorporated
herein by reference from exhibit of like number from the
Company's Annual Report on Form 10-KSB filed by the
Company on December 28, 1995.)
10(i)(f) * Letter of Agreement and Settlement of All Claims dated
July 7, 1995, amending the Settlement Agreement dated
December 16, 1994, between the Company, The Canton
Industrial Corporation, A-Z Professional Consultants,
Inc., Ira L. Friedman and Richard T. Johnson.
(Incorporated herein by reference from exhibit of like
number from the Company's Annual Report on Form 10-KSB
filed by the Company on December 28, 1995.)
10(i)(g) * Amendment to Letter of Agreement, Settlement of All
Claims, dated July 11, 1995, between the Company The
Canton Industrial Corporation, A-Z Professional
Consultants, Inc., Ira L. Friedman and Richard T.
Johnson. (Incorporated herein by reference from exhibit
of like number from the Company's Annual Report on Form
10-KSB filed by the Company on December 28, 1995.)
10(i)(h) * Binding Letter of Intent between the Company and
MAXMusic, Inc. Dated February 14, 1994. (Incorporated
herein by reference from Exhibit 10 to Current Report on
Form 8-K filed by the Company on March 11, 1994.) 10
(i)(i) * Stock Exchange Agreement of December 8, 1995
between the Company and AltaChem Group, Inc.
(Incorporated herein by reference from the Company's 8-K
dated May 8, 1996.)
10(i)(j) 31 Purchase Agreement between the Company and CyberMalls,
Inc. dated July 11, 1996.
10(i)(k) 43 Financial Consulting Agreement between CyberFootball and
Canton Financial Services, Corporation dated August 31,
1996.
10(i)(l) 52 Agreement for Exchange of Stock between the Company and
Kingslawn Offset, Inc. dated September 10, 1996
10(i)(m) 56 Stock Exchange Agreement of December 20, 1995 between
the Company and OMAP Holdings Incorporated.
10(i)(n) 63 Stock Exchange Agreement of December 20, 1995 between
the Company Eurotronics Holdings Incorporated.
10(i)(o) 73 Stock Exchange Agreement of December 20, 1995 between
the Company and Tianrong Building Material Holdings,
Ltd.
10(i)(p) 81 Stock Purchase Agreement dated January 15, 1996 betweeen
the Company and OMAP Holdings Incorporated, a Nevada
corporation. (OMAP).
10(i)(q) 86 Stock Purchase Agreement dated January 30, 1996 between
the Company and OMAP.
10(i)(r) 91 Stock Purchase Agreement dated February 9, 1996 between
the Company and OMAP
10(i)(s) 97 Stock Purchase Agreement dates September 28, 1995
between the Company and Tianrong Building Material
Holdings, Ltd.
* These exhibits appear in the manually signed original Reports for the periods
indicated by each item and are hereby incorporated by this reference.
<PAGE>
10(i)(j)
<PAGE>
PURCHASE AGREEMENT
This Purchase Agreement ("Agreement") is made between CyberMalls, Inc.,
a Nevada corporation ("CyberMalls"), its subsidiary, Cyber Football, Inc., a
Nevada corporation "CFI") and, BRIA Communications Corporation, a New Jersey
corporation ("Client"), with respect to the following:
RECITALS
WHEREAS, CyberMalls builds and sells virtual malls on the information
superhighway (Internet) and provides the necessary support and maintenance
services to companies that desire to market and/or promote their products and/or
services on the information superhighway; and
WHEREAS, Client wishes to purchase from CyberMalls, Cyber Football,
Inc., a Nevada corporation ("CFI"); and
WHEREAS, CFI markets and promotes products and services that relate to
the sport of football; and
WHEREAS, Client desires that CyberMalls develops a virtual mall for CFI
on the Internet to promote and market products and services relating to sports
and specifically to the sport of football.
DEFINITIONS
1. "Virtual mall" is a theme-based shopping center located on
the information superhighway which will contain a diversity of multiple
retailers.
2. "Virtual mall owner" is the proprietor of a theme-based
virtual shopping center with multiple retailers offering products and/or
services within the mall theme.
3. "Retailer" is a lessee of advertising and/or sales of
services and/or products in a CyberMalls' virtual mall.
4. "CyberService Protocols" are unique services that CyberMalls
will use its best efforts to provide to retailers which shall include, among
other things, the following:
<PAGE>
A. "Virtual shopping cart" that can select goods not only
from retailers within that virtual mall, but within
other CyberMalls virtual malls, and potentially in other
virtual shopping enterprises.
B. Payment for all purchases in virtual shopping cart at
conclusion of shopping experience.
C. Payment made at one point-of-sale.
D. Best efforts shall be used to ensure that purchases will
be protected by computer security software to ensure
confidentiality of payment data.
5. "WebSafari(TM) Protocols" are proprietary technologies that
include, but are not limited to:
A. The WebSafari(TM) search engine.
B. The CyberMalls' inventory Distributed Database provided
to each retailer and virtual mall owner.
C. Reverse link icons.
D. Equipment and technology pertaining to WebSafari(TM).
6. "WebSafari(TM) Mall Membership" includes, but is not limited
to:
A. Up to 250,000 search engine references to said mall per
month;
B. 250,000 inventory database items for one year;
C. Up to 5,000 web pages, either manual or auto-created;
D. High-speed information superhighway backbone
connection;
E. Use of all necessary server-based equipment; and,
F. Up to 100 hours of consultation and training.
7. "Virtual Mall Viability" refers to the point in development
where CyberMalls, in its professional judgment, believes the virtual mall is
able to continue as a free-standing information superhighway virtual mall, with
sufficient retailers to be profitable, and without the development assistance
from CyberMalls' development team, but not to exceed two (2) years.
<PAGE>
8. "Act" refers to the Securities Act of 1933, as amended,
pertinent portions available if requested by Client.
AGREEMENT
IN CONSIDERATION OF the mutual promises made by CyberMalls, CFI and
Client, and the terms and conditions hereafter set forth, the receipt and
adequacy of such consideration being mutually acknowledged, CyberMalls, CFI and
Client therefore agree to the following:
1. Terms of Purchase Agreement:
A. Sale and Purchase. CyberMalls agrees to sell to Client and Client
agrees to purchase from CyberMalls, Cyber Football, Inc., a Nevada
corporation ("CFI"). As a condition to the purchase of the CFI, CFI
further agrees to purchase from CyberMalls a virtual mall as more fully
explained herein. CyberMalls shall then design and build for CFI a
virtual mall containing WebSafari(TM) Protocols meeting Client's
specific needs. During development, which shall not exceed two (2)
years, Client shall have use of CyberMalls' CyberService Protocols, and
any other services and/or technologies CyberMalls develops that are
intended for virtual malls. The CFI mall shall be designed to
accommodate WebSafari Mall Membership protocols. Client and CFI agree
that during the two year development period, Client and CFI will remain
in compliance with WebSafari(TM)Mall Membership protocols and for so
long as CFI has a membership with WebSafari. CFI's virtual mall shall
contain and be provided with the following:
1. use of CyberMalls' data communication line, as needed;
use of CyberMalls' computer hardware and software, as
needed; use of CyberMalls' graphic design team for CFI
web pages designs and other virtual mall requirements, as
needed; use of CyberMalls' copy writing and editing team
in CFI web pages designs and other virtual mall
requirements, as needed; and use of CyberMalls' scanning
systems, facsimile systems, photocopiers, and any other
equipment specifically for construction and development
of CFI virtual mall, as needed.
2. any necessary standardized forms.
3. the standard WebSafari(TM) Mall Membership for the
duration of the business relationship between CyberMalls
and CFI. The fees for this Membership which are set forth
in detail in the WebSafari Mall Membership Agreement,
which shall be incorporated into this Agreement, shall be
submitted to Client within 30 days from the date of the
signing of this Agreement.
<PAGE>
B. Compensation. According to the specific terms herein, the
compensation shall be as follows:
1. In consideration for the purchase of a majority
interest in CFI, upon the execution of this
Agreement, BRIA will issue to CyberMalls 1,875,000
shares of its Class A Common Stock at 1/2 the present
bid price or, $0.375 per share. CFI will issue to
BRIA 9,101,019 shares of its restricted common stock
which reflects approximately 90.1% of the authorized,
issued and outstanding shares of CFI.
2. Further, for the purchase of the virtual mall from
CyberMalls, CFI will execute a Promissory Note in
favor of CyberMalls in the amount of $11,500,000
bearing an interest rate of 9% per annum, to be
payable three (3) years from the date of the
execution of this Agreement. The Note shall be
secured by the CFI trademark and domain rights. BRIA
shall be a guarantor on said Note to the extent that
such guarantee shall be secured by 100% of BRIA's
interest in CFI's common stock. Said Note is attached
hereto as Exhibit "A".
3. Additionally, as compensation for services to be
provided with regard to the creation, development and
initial servicing of the virtual mall, CFI shall
equally divide with CyberMalls the proceeds realized
from a Regulation D Rule 504 Offering pursuant to a
Financial Consulting Agreement entered into between
the Client, CFI and Canton Financial Services
Corporation on behalf of CFI, dated August 31, 1996,
a copy of which is attached hereto as Exhibit "B".
4. Further, once an aggregate of $4 million in gross
revenues has been realized by CFI, CFI shall issue to
CyberMalls 100,000 shares of its free-trading stock,
for services rendered, with such shares being
registered, or if registration is impractical then
such shares being issued pursuant to an available
exemption from registration under the Act.
5. Moreover, as long as CyberMalls is providing
services to CFI, it shall receive 3% of the
quarterly gross revenues of CFI, which are to be
disbursed on a quarterly basis.
6. Immediately upon receipt by CFI of lease payments
received from any "tenants" directly procured by
CyberMalls and placed under CFI's virtual mall, CFI
shall compensate CyberMalls 15% of such payments in
stock or in cash, at CyberMall's option.
<PAGE>
C. Expenses:
1. Client shall be responsible for all costs associated
with the construction, development and continuing
service of the CFI virtual mall. Such costs shall
include rental of CyberMalls equipment and CyberMalls
materials, which at the time of execution of this
Agreement is approximately $5,000 per month, which
shall be waived for a period of ninety (90) days in
accordance with paragraph C(3) below. CyberMalls
shall provide Client a monthly itemized statement of
all costs incurred for Client. Any fees and expenses
that are not due directly to CyberMalls for services
rendered, shall be borne by Client.
2. All time spent on each matter by CyberMalls, any
subcontractor of CyberMalls or any of its
subsidiaries, shall be recorded and charged at their
respective hourly rate and shall be subject to
periodic review based on the status of the person
performing the work. In the event that any
compensation or expense is not remitted within thirty
(30) days, the CyberMalls' statement detailing such
compensation or expense shall incur interest at 12%
per annum, compounded annually.
3. In the event of a dispute over expenses to be paid by
Client to CyberMalls, Client shall present CyberMalls
with written document detailing the nature of the
dispute. CyberMalls and Client shall first attempt to
resolve the matter among themselves. If, after 30
days from the date of Client's dispute letter, the
matter has not been resolved in writing and signed by
both parties, it shall next be submitted to
arbitration, outlined in section 3.
D. Term of Service and Development. CyberMalls shall be
obligated to provide all services necessary to achieve the development of CFI's
virtual mall to Client's specifications for a period of two years from the date
of this Agreement.
E. Official Notices. All official communications or legal
notices shall be given in writing by registered or certified mail, addressed to
the respective party at the postal address or other address(es) as each party
may hereafter designate in writing, or when sent by facsimile transmission,
charges prepaid. The present addresses of the parties are as follows:
<PAGE>
CYBERMALLS, INC.
268 West 400 South, Ste, 200
(801) 575-8073
(801) 575-8092 (fax)
Attn: Nathan Tippetts, President
and,
BRIA COMMUNICATIONS CORPORATION
and,
CYBER FOOTBALL, INC.
1471-17 Newport Ave.,
Neponsit, N.Y. 11694
718-318-1535
718-945-1044 (fax)
Attn: Richard Lifschutz, President
2. Confidentiality of Proprietary Information:
A. Confidential Information. For the purpose of this Agreement,
"confidential information" shall include any trade secret, inside
information or proprietary information, including technical data or
know-how, plans of operation, diagrams, drawings, photographs, pictures
or any patent rights, copyrights, trademarks, service marks, or
licensing rights to any and all designs, design changes, improvements,
or modifications to any of the products or services of any of the
parties. Confidential information also includes other information that
the parties know is confidential or that a reasonable person in the
position of the parties would have reason to believe is confidential.
Confidential Information shall further include such information as
designated by the parties herein, including Client's Information and
CyberMalls' Information.
B. The Client Information. In connection with the performance of its
obligations under the Agreement, CyberMalls or its associates may be
provided copies, or access to originals, of financial information,
business plans, customer and supplier lists, records concerning
technical processes, computer hardware and software, research and
development data, product lists, product designs and drawings, new
product ideas, and other information concerning Client and its
business, much of which is confidential and proprietary (the "Client
Information").
C. The CyberMalls Information. In connection with the performance of
its obligations under this Agreement, Client or its associates may be
provided copies, or access to originals, of financial information,
business plans, customer and supplier lists, records concerning
technical processes, computer hardware or software, and other
information concerning CyberMalls and its business, much of which is
confidential and proprietary (the "CyberMalls Information").
<PAGE>
D. The parties agree not to use or disclose any confidential
information for any purpose except to carry out the purposes of this
Agreement. The parties further agree to limit internal disclosure of
confidential information on a need to know basis to those key executive
officers, legal and accounting advisors, and any necessary parties
involved in the development of CFI's virtual mall. The parties warrant
that all such individuals have been or will be advised of and agree to
adhere to the confidentiality provisions of this Agreement. The parties
also agree to hold confidential information in the strictest confidence
and to take all reasonable measures to protect the confidentiality of
and avoid unauthorized disclosure of any confidential information.
E. The confidentiality obligations imposed by this Agreement shall not
apply to material and information if:
1. Such material or information is in the public domain
at the time of disclosure, through no wrongful act
of the receiving party; or
2. Such material or information is generally known to
the receiving party at the time of disclosure
without obligation concerning its confidentiality;
or
3. Such material or information is furnished to a third
party by the original possessor thereof under no
obligation of confidentiality.
F. Unless otherwise approved in writing by an officer of CyberMalls,
any data, products, technology or information on any other person,
entity, organization, or thing obtained by Client or CFI through
WebSafari(TM) Distributed Database, or its other services, is to remain
the sole property of CyberMalls and shall be used only in conjunction
with and/or within the scope of this Agreement explicitly with respect
to the business relationship between the parties.
G. The parties understand and agree that the breach or threatened
breach of the agreement not to disclose confidential information may
cause irreparable injury to the violated party. Accordingly, in
addition to any other relief to which the parties may be entitled, the
parties agree that the violated party shall be entitled, without proof
of damages, or posting of a bond, to pursue a remedy at law or in
equity for any damages resulting therefrom, including injunctive
relief.
H. All restrictions on the use or disclosure of proprietary information
contained herein shall remain in effect during the term of this
Agreement and shall continue for a period of five (5) years after the
expiration or termination of this Agreement.
3. Arbitration. All disputes that cannot be settled between the parties
together under this Agreement, shall be settled by arbitration in accordance
with the rules of the American Arbitration Association then controlling.
A. Disputes Shall Not Affect Agreement: Disputes, differences or
controversies between the parties during the term of this Agreement
shall not interrupt performance of this Agreement. In the event of any
such dispute, difference or controversy, CyberMalls and WebSafari(TM)
shall continue to perform on behalf of Client and/or CFI, and
settlements and payments shall be made in the same manner as prior to
such dispute, difference or controversy, until the matter in dispute
has been finally determined between the parties.
4. Termination of Agreement:
A. Breach: Termination of this Agreement prior to conclusion of
the two (2) year development or viability period shall be considered
breach of this Agreement. The non-breaching party shall have the right
to recover all relevant damages associated with breach in a competent
court of law, according to the provisions of this Agreement.
B. Failure to Remit Expenses: The continued lack of payment by
Client and/or CFI for a period of 60 continuous days shall be
considered a breach of this Agreement.
C. Costs Due Upon Breach: Notwithstanding the breach of this
Agreement by either party, CyberMalls shall be entitled to receipt of
all fees, hard costs, compensation and expenses incurred for actual
work performed at its normal consulting rates, and shall retain or
continue to be entitled to any stock either issued or authorized to be
issued to CyberMalls or its designees.
6. Modification of Agreement:
A. Written Modifications: Written communications from CyberMalls
to Client modifying terms of this Agreement are valid and enforceable
when signed by all parties, their successors and/or assigns to this
Agreement.
<PAGE>
7. Controlling Laws of Agreement:
A. Best Efforts Basis: CyberMalls agrees that it will at all
times faithfully, to the best of its experience, ability and talents,
perform all the duties that may be required of and from CyberMalls
pursuant to the terms of this Agreement. CyberMalls does not guarantee
that its efforts will have any impact on Client's business or that any
subsequent financial improvement will result from CyberMalls' efforts.
Client understands and acknowledges that the success or failure of
CyberMalls' efforts will be predicated on Client's assets and
operating results.
B. Binding Law: This Agreement shall be subject to all valid
applicable laws, rules and regulations of the State of Utah and of the
United States. In the event that this Agreement, any of its
provisions, or its outlined operations are found to be inconsistent
with or contrary to any such laws, rules or regulations, the latter
shall control. Furthermore, if commercially practicable, this
Agreement shall be considered modified accordingly and shall continue
in full force and effect as so modified.
1. In the event of litigation or other dispute
resolution, disputes, differences, or controversies
shall be heard in a court of competent jurisdiction
within the State of Utah, in Salt Lake County, Utah.
C. Entire Agreement: This Agreement shall constitute the entire
Agreement between the parties herein unless modified by a written
amendment signed by all of the parties or their successors in
interest, or unless superseded by any supplemental Purchase Agreement
entered into by the parties. There are no other agreements,
undertakings, restrictions, representations or warranties among the
parties other than those described and provided for in this Agreement
and expressly signed by each party herein . D. Waiver: Client and CFI
agree that CyberMalls' failure to enforce any provision or provisions
of this Agreement shall not in any way be construed as a waiver of
that provision or provisions, nor shall such failure prevent
CyberMalls from thereafter enforcing each and every provision of this
Agreement.
8. Non-Circumvention:
A. Non-Circumvention: Client agrees that it will not enter into
any transaction involving a business opportunity introduced to Client
or CFI by CyberMalls without compensating CyberMalls as required
hereunder. Such transaction will be construed as breach of this
Agreement. Client and CFI further agree that any unauthorized use of
any proprietary information whether accidental or otherwise shall be
construed as intentional and shall be considered a breach of this
Agreement.
9. Due Diligence: The parties herein agree to mutually cooperate with
each other concerning any reasonable requests with respect to pursuing proper
and necessary due diligence.
<PAGE>
10. Client's Representations: Client represents, warrants and covenants to
CyberMalls that each of the following are true and complete as of the date of
this Agreement:
A. Client is a corporation organized, validly existing, and in
good standing under the laws of the state of New Jersey, with full
corporate power and authority and all necessary governmental
authorization to own, lease and operate property and carry on its
business as it is now being conducted.
B. Client is qualified to do business in and is in good standing
in every jurisdiction in which the nature of its business or the
property owned or leased by it makes such qualifications necessary.
11. Consents and Authorizations: Any consent, approval, order or
authorization of, or registration, declaration, compliance with or filing with
any governmental or regulatory authority required in connection with the
execution and delivery of this Agreement to permit the consummation by Client,
CFI and CyberMalls of the transactions described in this Agreement shall be
accomplished in a timely manner and in accordance with all federal and state
laws where applicable.
12. No Litigation Pending: There are no judicial or administrative
actions, suits, proceedings or investigations pending or, to the knowledge of
Client, threatened which may result in any liability on the part of Client other
than what has already been disclosed to CyberMalls.
13. CyberMalls' Disclosure: CyberMalls makes no warranties or
representations with respect to the value or potential value or earnings
potential, of the CFI virtual mall.
14. Limitation of Assignment: Neither Client nor CFI will transfer, sell,
hypothecate, assign or distribute any of the assets currently in its possession,
including the CFI common stock, except upon the express, written and signed
agreement by all of the parties to this Agreement, and will continue operations
in substantially the same manner as it is presently functioning, until this
Agreement has been consummated.
15. Attorney Fees: In the event that any court proceeding or dispute
resolution procedure is brought under or in connection with this Agreement, the
prevailing party in such proceeding shall be entitled to recover from the other
party all costs, expenses and reasonable attorneys' fees incidental to such
legal action. The term "prevailing party" as defined in this Agreement shall
mean the party in whose favor a final judgment or award on the merits is
entered. The prevailing party may apply to the court or the person(s) or board
in charge of the proceeding, for an award of costs, expenses and reasonable
attorneys' fees.
<PAGE>
16. Future Taxes:
A. CyberMalls, Inc. is not responsible for taxes on Virtual Property:
The parties also acknowledge that in the future, virtual malls may be
subjected to a variety of tax obligations from one or more regulatory
or governmental agencies. It is understood that should virtual malls,
as defined and described in this Agreement, be assessed or obliged to
pay additional taxes beyond what are assessed at the date of this
Agreement, virtual mall owner shall assume responsibility for such
taxes associated with construction, development, operation and/or
revenues derived therefrom. Client and CFI acknowledge that CyberMalls
shall not be liable to pay any future tax assessments associated with
virtual mall.
17. Facsimile Counterparts: If a party signs this Agreement and transmits
an electronic facsimile of the signature page to the other party, the party who
receives the transmission may rely upon the electronic facsimile as a signed
original of this Agreement. Further, this Agreement may be executed in
counterparts.
AGREED TO this 31st day of August, 1996 by the parties herein.
CyberMalls, Inc. BRIA Communications Corporation
and,
Cyber Football, Inc.
/s/Nathan Tippetts /s/Richard Lifschutz
Nathan Tippetts, President Richard Lifschutz, President
<PAGE>
10(i)(k)
<PAGE>
FINANCIAL CONSULTING AGREEMENT
This Financial Consulting Agreement ("Agreement") is made between
Canton Financial Services Corporation, a Nevada corporation ("CFS") and, Cyber
Football, Inc., a Nevada corporation ("Client") with respect to the following:
RECITALS
WHEREAS, CFS is in the business of providing general business
consulting services to privately held and publicly held corporations; and
WHEREAS, Client is in the business of marketing and promoting products
and services that are related to the sport of football and wishes to retain the
consulting services of CFS for Client's initial capital acquisition pursuant to
forming a public corporation; and
DEFINITIONS
1. "The Act" refers to the Securities Act of 1933, as amended,
available upon request.
2. "Rule 504" refers to Rule 504 under The Act, available upon
request.
3. "SEC" refers to the Securities and Exchange Commission.
AGREEMENT
IN CONSIDERATION of the mutual promises made by CFS and Client, and the
terms and conditions hereafter set forth, the receipt and adequacy of such
consideration being mutually acknowledged, CFS and Client therefore agree to the
following:
1. Terms of this Consulting Agreement:
A. Term: The initial term shall be for the period of one (1)
year ("Initial Term").
B. Consulting Services: CFS will use its best efforts to assist
Client in the following services ("Consulting Services"):
1. Achieving the requirements of becoming a public
entity;
<PAGE>
2. Applying the techniques and preparing the documents
for raising capital through a placement of Client's
stock or investment units under Rule 504, Regulation
D, under The Act, including but not limited to
preparation of necessary documentation to complete
the offering in compliance with the applicable
federal and state rules and regulations, preparation
of a due diligence file, and delivery of the
necessary forms to the SEC with the requisite number
of copies;
3. Establishing an account with a transfer agency;
4. Obtaining a CUSIP number;
5. The preparation and filing of a package as required
by Rule 15(c) 2-11 under The Act;
6. Obtaining a trading quote of Client's equity;
7. Notifying market makers to develop a market for
Client's stock;
8. Notifying appropriate public relations and investor
relations services; and,
9. Making application to Standard & Poor's to clear
client securities for trading in states allowing a
Standard & Poor's manual exemption.
C. Compensation:
1. In consideration for CFS's services, as described herein,
Client shall pay to CFS 150,000 worth of BRIA Communication
Corporation's ("BRIA") free- trading Class A Common Stock
(the "Stock").
2. In addition, for the creation, development and initial
servicing of the virtual mall, Client shall equally divided
the proceeds realized from said Rule 504 Offering with
CyberMalls, Inc., (a sibling corporation of CFS) pursuant to
a Purchase Agreement, as attached hereto as Exhibit "A".
D. Expenses:
1. Client shall be responsible for all costs associated with
the completion of the Consulting Services that are not
directly due CFS. Such costs shall include corporation fees
and filing fees, transfer agent fees, CUSIP number fee, fees
for the audit required for the Rule 15(c) 2-11 and other
incidental costs, which at the time of execution of this
Agreement shall not exceed $12,000 for the Initial Term of
this Agreement. Any other expenses anticipated to exceed
$1,000 shall be pre-approved by Client. Before any monies are
disbursed, said costs shall be first deducted from the
proceeds from the Rule 504 Offering.
<PAGE>
2. All monies realized from the Rule 504 Offering shall go
directly into an escrow account to be determined by the
parties herein and shall be disbursed pursuant to specific
instructions. Client shall assume responsibility for any
escrow expenses.
3. All time spent on each matter by any subcontractor of CFS
or any of its subsidiaries, shall be recorded and charged at
the subcontractor's hourly rate. In the event that any
compensation and/or expenses is not remitted within thirty
(30) days, the CFS statement detailing such compensation
and/or expenses shall incur interest at 12% per annum,
compounded annually. At Client's option, statements for
compensation and/or expenses may be settled by the issuance of
additional shares of the Client's free-trading common stock
valued at the bid and ask price on the date of the statement.
4. In the event of a dispute over expenses to be paid by
Client to CFS, Client shall present CFS with a written
document detailing the nature of the dispute. CFS and Client
shall first attempt to resolve the matter among themselves.
If, after 30 days from the date of Client's dispute letter,
the matter has not been resolved in writing and signed by
both parties, it shall next be submitted to arbitration,
outlined in Section 3 herein.
5. In addition to the expenses disclosed in Section 1(D)(1)
above, Client shall be responsible for its own expenses
related to but not limited to, legal counsel, accounting and
auditing expenses, travel and any other expenses it incurs on
its own behalf.
E. Extensions and Renewals. This Agreement may be terminated earlier
than the Initial Term if the Consulting Services are completed prior to
the expiration of this time period. Notice of early termination must be
provided by CFS to Client in writing within a reasonable time. This
Agreement may be extended ("Extension Period") on a month-to-month
basis by mutual agreement of the parties, following a mutually
negotiated, written amendment to this Agreement specifying the new time
period, terms of the Amendment and CFS's compensation for the Extension
Period. Notice by CFS of early termination, or mutually agreed
extension amendment must comply with Section 1-D.
F. Official Notices: All official communications or legal notices
shall be given in writing by registered or certified mail, addressed
to the respective party at the postal address or other address(es) as
each party may hereafter designate in writing, or when sent by
facsimile transmission, charges prepaid. The present addresses of the
parties are as follows:
<PAGE>
CANTON FINANCIAL SERVICES CORPORATION
268 West 400 South, Suite 300
Salt Lake City, Utah 84101
Telephone: (801) 575-8073
Facsimile: (801) 575-8092
Attn: Richard Surber, President
AND,
CYBER FOOTBALL, INC.
147-17 Newport Ave.
Neponsit, N.Y. 11694
718-318-1535
718-945-1044 (fax)
Attn: Richard Lifschutz, President
2. Confidentiality of Proprietary Information:
A. Confidential Information:
1. "Confidential Information" means any proprietary
information, technical data or know-how disclosed to Client by
CFS, either directly or indirectly in writing, orally, by
drawing, or by inspection or other tangible items.
Confidential information shall include, without limitation,
all business, product, research and financial plans of CFS
disclosed to or discussed with Client.
2. Client agrees not to use any of CFS's or any of its parent
or sibling companies' ("CFS and Companies") confidential
information for its own uses or for any purpose except to
carry out discussions or a business understanding between
Client and CFS and Companies.
3. Client agrees not to disclose any of CFS and Companies'
confidential information to any third party and, that they
will take all reasonable measures to protect the secrecy of
and avoid disclosure or use of CFS and companies' confidential
information.
<PAGE>
4. Client acknowledges that nothing contained in this
Agreement will be construed as granting any rights, by
license or otherwise, to any of CFS' or any of its parent or
sibling companies' confidential information, except as
specified in this Agreement.
5. CFS agrees to be bound by all of the above terms contained
in this Section with regards to Client's confidential and
proprietary information that may be obtained in the course of
this Agreement.
B. Limitation of Liability for Non-Party Disclosures: CFS shall
have no liability to the Client with respect to the use or disclosure
to others not party to this Agreement, of such information as CFS can
establish to:
1. Have been publicly known;
2. Have become known, without fault on the part of CFS,
subsequent to disclosure by Client of such
information to CFS;
3. Have been otherwise known by CFS prior to
communication by the Client to CFS of such
information; or
4. Have been received by CFS at any time from a source
other than Client lawfully having possession of such
information.
C. Unauthorized Use: Both parties agree that any unauthorized
use of any proprietary information whether accidental or otherwise
shall be construed as intentional and shall be considered a breach of
this Agreement.
3. Arbitration:
A. All disputes that cannot be settled between the parties together
under this Agreement, shall be settled by arbitration in accordance
with the rules of the American Arbitration Association then
controlling.
B. Disputes Shall Not Affect Agreement: Disputes, differences or
controversies between the parties during the term of this Agreement
shall not interrupt performance of this Agreement.
1. In the event of any such dispute, difference or
controversy this agreement shall continue to be in
full force, and settlements and payments shall be
made in the same manner as prior to such dispute,
difference or controversy, until the matter in
dispute has been finally determined between the
parties.
<PAGE>
4. Termination of Agreement:
A. Breach: Termination of this Agreement prior to conclusion of the 1
year term shall be considered breach of this Agreement.
B. Failure to Remit Expenses: The continued lack of payment by Client
for a period of 60 continuous days pursuant to Section 1(E) shall be
considered a breach of this Agreement and shall, at Canton's option,
be valid grounds to terminate this Agreement.
C. Costs Due Upon Breach: Notwithstanding the breach of this Agreement
by Client, CFS shall be entitled to receipt of all fees, hard costs,
compensation and expenses incurred for actual work performed at its
normal consulting rates and shall continue to be entitled to any stock
either issued or authorized to be issued to CFS or its designees.
5. Legal Counsel Understanding: CFS is not a law firm; neither is it an
accounting firm. Although CFS retains the services of legal and accounting
professionals to better enable CFS to provide consulting services, Client
understands that it has not, nor will it, construe any of CFS's representations
to be statements of law. Client agrees that it is incumbent upon it to seek and
continue to seek the independent advice of legal and financial counsel regarding
all material aspects of the transactions contemplated by this Agreement,
including the review of all documents provided by CFS to Client as well as with
respect to all opportunities CFS may introduce to Client. Client acknowledges
that no representation or warranty has been given to Client by CFS as to any
legal, tax, accounting, financial or other aspect of the transactions
contemplated by this Agreement.
6. Controlling Laws of Agreement:
A. Best Efforts Basis: CFS agrees that it will at all times faithfully,
to the best of its experience, ability and talents, perform all the
duties that may be required of and from CFS pursuant to the terms of
this Agreement. CFS does not guarantee that its efforts will have any
impact on Client's business or that any subsequent financial
improvement will result from CFS's efforts. Client understands and
acknowledges that the success or failure of CFS's efforts will be
predicated on Client's assets and operating results.
B. Binding Law: This Agreement shall be subject to all valid applicable
laws, rules and regulations of the State of Utah and of the United
States. In the event that this Agreement, any of its provisions, or its
outlined operations are found to be inconsistent with or contrary to
any such laws, rules or regulations, the latter shall control.
Furthermore, if commercially practicable, this Agreement shall be
considered modified accordingly and shall continue in full force and
effect as so modified.
<PAGE>
1. Both parties reserve the right to meet within a
reasonable time and discuss any necessary
amendments or modifications should the modified
Agreement not be commercially practicable in the
opinion of either party's legal counsel.
2. In the event of litigation or other dispute
resolution, this Agreement shall be controlled by
the laws of the State of Utah.
3. In the event of dispute resolution, disputes,
differences, or controversies shall be heard in the
venue of the State of Utah, in Salt Lake City,
Utah.
C. Entire Agreement: This Agreement shall constitute the entire
Agreement between the parties unless modified by a written amendment
signed by all of the parties or their successors in interest. There are
no other agreements, undertakings, restrictions, representations or
warranties among the parties other than those described and provided
for in this Agreement and expressly signed by the parties herein.
D. Waiver: Client agrees that CFS's failure to enforce any provision
or provisions of this Agreement shall not in any way be construed as a
waiver of that provision or provisions, nor shall such failure prevent
CFS from thereafter enforcing each and every provision of this
Agreement.
7. Non-Circumvention:
A. Non-Circumvention: Client agrees that neither will enter into any
transaction involving a business opportunity introduced by CFS without
compensating CFS as required hereunder. Such transaction will be
construed as breach of this Agreement. Client further agrees that any
unauthorized use of any proprietary information whether accidental or
otherwise shall be construed as intentional and shall be considered a
breach of this Agreement.
8. Due Diligence: The parties herein agree to mutually cooperate with
each other concerning any reasonable requests with respect to pursuing proper
and necessary due diligence.
9. Parties' Representations: Client represents to CFS and CFS represents
to Client that each of the following are true and complete as of the date of
this Agreement:
<PAGE>
A. Client and CFS are corporations organized, validly existing, and in
good standing under the laws of the state(s) of their incorporations,
with full corporate power and authority and all necessary governmental
authorization to own, lease and operate property and carry on their
businesses as they are now being conducted. Client and CFS are
qualified to do business in and are in good standing in every
jurisdiction in which the nature of their businesses or the
property(ies) owned or leased by them makes such qualifications
necessary.
10. CFS is not an Agent or Employee of Client: CFS's obligations under this
Agreement consist solely of the services previously described. In no event shall
CFS be considered to act as an employee or agent of Client otherwise represent
or bind Client. For the purposes of this Agreement, CFS is an independent
contractor. All final decisions with respect to acts of Client, whether or not
made pursuant to or in reliance on information or advice furnished by CFS in
this Agreement, shall be those of Client, CFS's employees or agents shall under
no circumstances be liable for any expense or loss incurred by Client as a
consequence of such action or decisions.
11. Attorney Fees: In the event that any court proceeding or dispute resolution
procedure is brought under or in connection with this Agreement, the prevailing
party in such proceeding (whether on trial or on appeal) shall be entitled to
recover from the other party all costs, expenses and reasonable attorneys' fees
incidental to such legal action. The term "prevailing party" as defined in this
Agreement shall mean the party in whose favor a final judgment or award on the
merits is entered. The prevailing party may apply to the court or the person(s)
or board in charge of the proceeding, for an award of costs, expenses and
reasonable attorneys' fees.
12. Limitation of Assignment: Within the scope of this Agreement, subsequent to
this transaction, Client will not transfer, sell, assign or distribute any of
the assets currently in its possession, including its common stock, that would
materially alter or affect CFS's interest or relationship with Client, except
upon the express, written and signed agreement by all the parties herein.
13. Facsimile Counterparts: If a party signs this Agreement and transmits an
electronic facsimile of the signature page to the other party, the party who
receives the transmission may rely upon the electronic facsimile as a signed
original of this Agreement. Further, this Agreement may be executed in
counterparts.
AGREED TO this 31st day of August, 1996.
Canton Financial Services Corporation CyberFootball, Inc.
/S/ Richard Surber /S/Richard Lifschutz
- ------------------------ ---------------------------
Richard Surber, President Richard Lifschutz, President
<PAGE>
10 (i) (l)
<PAGE>
AGREEMENT FOR EXCHANGE OF STOCK
This Agreement for the Exchange of Stock ("Agreement") is made effective as
of this 10th day of September, 1996, by and between Kingslawn Offset, Inc., a
New York corporation ("KINGS") and, BRIA Communications Corporation, a
publicly-traded New Jersey corporation ("BRIA"), with respect to the following:
Recitals
Whereas, KINGS and its principal shareholders desire to sell and transfer
to BRIA all of their right, title, and interest in and to all of the outstanding
shares of KINGS, in exchange for certain shares of BRIA restricted Class A
common stock described herein; and
Whereas, BRIA is desirous of acquiring the shares and the assets to be
conveyed by KINGS, for the consideration and upon the terms and conditions as
set forth below; and
Whereas, the parties desire to make this transaction a tax-free exchange of
stock under the tax laws of the United States, insofar as possible.
Agreement
Now, Therefore, for valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties have agreed as follows:
1. Consideration, Sale, Exchange of shares. At the closing herein ("Closing"),
KINGS agrees to sell, assign, transfer and convey, exclusively to BRIA, all of
KINGS' right, title, and interest, in and to all of the outstanding shares of
stock of KINGS, of any and all class or classes, together with all of the assets
of KINGS of any kind, whether real or personal property, proprietary
information, equipment, technology, drawings, production know how, software
sources; customer lists and existing customer contracts; trade name, good will,
books, records, and financial information about the company, and the like,
whether in written or verbal form.
At closing, BRIA will issue to KINGS or its assigns, $1.5 million worth of
its restricted Class A common stock, restricted pursuant to SEC Rule 144, at
$.75 per share. Yosef M. Shimron ("Shimron"), as Prescient and principal
shareholder in KINGS, shall have a lien in the amount of $500,000 on all the
equipment and fixtures presently in the possession of the Kingslawn Offset, Inc.
Shimron shall have the option of converting the lien to BRIA's common stock at
$.75 per share. From and after closing, KINGS will become a wholly-owned
subsidiary of BRIA, and the name of Kingslawn Offset, Inc. will duly be changed
to "NEW YORK PRINTING GROUP" ("NYPG").
2. Representation and Warranties of Kingslawn Offset, Inc. KINGS represents
and warrants that:
a. Its shareholders ("shareholders") are citizens of the United States of
America.
b. Shareholders are acquiring the Shares for their own account and not
with a view to any distribution within the meaning of the Securities Act of
1933, as amended (the "Act"). As "Purchaser", they acknowledge that they have
been advised and are aware that (i) the Company ("BRIA") is relying upon an
exemption under the Act predicated upon the Purchaser's representations and
warranties contained in this Agreement, and (ii) the Shares issued to the
Purchaser pursuant to this Agreement will be "restricted stock" within the
meaning of the rules and regulations (the "Rules") promulgated by the United
States Securities and Exchange Commission ("SEC") pursuant to the Act. Unless,
and until, the Shares are registered under the Act, they will be subject to
limitations upon resale set forth in the Rules or in other administrative
interpretations by the SEC in effect at the time of the proposed sale or other
disposition.
<PAGE>
c. Purchaser has received all of the information they consider necessary
or appropriate for determining whether to acquire the Shares pursuant to this
Exchange. Purchasers are familiar with the business, affairs, risks and
properties of BRIA. Purchasers have had an opportunity to ask questions of and
receive answers from, the Company, and its officers, directors and other
representatives regarding the Company and the terms and conditions of the
offering of the Shares. Purchasers have had the opportunity to obtain any
additional information the Company possesses or could acquire without
unreasonable effort or expense, necessary to verify the accuracy of the
information furnished.
d. Purchasers have such knowledge and expertise in financial and business
matters that they are capable of evaluating the merits and substantial risks of
an investment in the Shares and are able to bear the economic risks relevant to
the purchase of the Shares hereunder.
e. Purchasers are relying solely upon independent consultation with their
professional, legal, tax and accounting advisors and such others as Purchasers
deem to be appropriate in purchasing the Shares; Purchasers have been advised
to, and have consulted with, their professional tax and legal advisors with
respect to any tax consequences of investing in the Company.
f. Purchasers recognize that an investment in the securities of the
Company involves substantial risk and understands all of the risk factors
related to the purchase of the Shares.
g. Purchasers understand that there may be no market for the Shares.
h. Purchasers' financial condition is such that Purchasers are under no
present or contemplated future need to dispose of any portion of Shares to
satisfy any existing or contemplated undertaking, need or indebtedness.
i. Without in any way limiting the representation set forth above,
Purchasers further agree not to make any disposition of all or any portion of
the Shares unless and until:
(1) There is then in effect a registration statement under the Act
covering such proposed disposition and such disposition is made in accordance
with such registration statement; or
(2) Purchasers shall have notified the Company of the proposed
disposition and shall have furnished the Company with a detailed statement of
the circumstances surrounding the proposed disposition, and if requested by the
Company, Purchasers shall have furnished the Company with an opinion of counsel,
reasonably satisfactory to the Company and its counsel, that such disposition
will not require registration under the Act.
j. It is understood that the certificates evidencing the Shares will bear
substantially the following legends:
"The securities evidenced hereby have not been registered under the
Securities Act of 1933, as amended (the "Act") nor qualified under
the securities laws of any states, and have been issued in reliance
upon exemptions from such registration and qualification for
non-public offerings. Accordingly, the sale, transfer, pledge,
hypothecation, or other disposition of any such securities or any
interest therein may not be accomplished except pursuant to an
effective registration statement under the Act and qualification
under applicable State securities laws, or pursuant to an opinion of
counsel, satisfactory in form and substance to the Company to the
effect that such registration and qualification are not required."
k. The Purchasers confer full authority upon the Company (i) to instruct
its transfer agent not to transfer any of the Shares until it has received
written approval from the Company and (ii) affix the legend in subparagraph (j)
above to the fact of the certificate or certificates representing the Shares.
<PAGE>
l. Purchasers understand that the Company is relying upon Purchasers'
representations and warranties as contained in this Agreement in consummating
the sale and transfer of the Shares without registering them under the Act or
any law. Therefore, Purchasers agree to indemnify the Company against, and hold
it harmless from, all losses, liabilities, costs, penalties and expenses
(including attorney's fees) which arise as a result of a sale, exchange or other
transfer of the Shares other than as permitted under this Agreement. Purchasers
further understand and agree that the Company will make an appropriate notation
on its transfer records of the restrictions applicable to these Shares.
m. KINGS has fully disclosed its financial condition to BRIA or its agent.
At closing, the principal shareholders and management of KINGS will deliver a
certificate attesting, among other things, that there will have been no material
changes in the condition of the business or its finances as reflected in its
financial statements, which shall be delivered to BRIA at Closing and audited in
accordance with generally accepted accounting principles; that all corporate
authority has been duly taken to enter into and close this transaction; that
there are no material undisclosed liabilities, claims, or judgments against that
company; and that all legal and governmental regulations or authorities will
have been complied with, or arrangements made for compliance, including
arrangements for any such outstanding liabilities, claims, or judgments.
3. Representations and Warranties of BRIA. The Company ("BRIA") represents
and warrants that:
a. The Company is a corporation duly organized, and validly existing under
the laws of the State of New Jersey, United States of America.
b. The Company has all necessary corporate power and authority under the
laws of New Jersey and all other applicable provisions of law to own its
properties and other assets now owned by it, to carry on its business as now
being conducted, and to execute and deliver and carry out the provisions of this
Agreement.
c. All corporate action on the part of the Company required for the lawful
execution and delivery of this Agreement and the issuance, execution and
delivery of the Shares has been duly and effectively taken. Upon execution and
delivery, this Agreement will constitute a valid and binding obligation of the
Company, enforceable in accordance with its terms, except as the enforceability
may be limited by applicable bankruptcy, insolvency or similar laws and judicial
decisions affecting creditors' rights generally.
4. Survival of Representations, Warranties and Covenants. The
representations, warranties and covenants made respectively by BRIA and KINGS in
this Agreement shall survive the closing and the exchange of the respective
Shares called for hereunder.
5. Miscellaneous. The following miscellaneous provisions, standard to
commercial contracts of this nature, are made part hereof:
a. In the event any one or more of the provisions contained in this
Agreement are for any reason held to be invalid, illegal or unenforceable in any
respect, such invalidity, illegality or unenforceability shall not effect any
other provisions of this Agreement. This Agreement shall be construed as if such
invalid, illegal or unenforceable provision had never been contained herein.
b. This Agreement shall be binding upon and inure to the benefit of the
parties and their respective heirs, legal representatives, successors and
permitted assigns. The parties may not transfer or assign all or any part of
their rights or obligations except to the extent expressly permitted by this
Agreement.
c. This Agreement constitutes the entire agreement and understanding
between the parties, and may not be modified or amended except in writing signed
by both parties.
d. No term or condition of this Agreement shall be deemed to have been
waived nor shall there be any estoppel to enforce any provision of this
Agreement except by written instrument of the party charged with such waiver or
estoppel.
<PAGE>
e. This agreement shall be interpreted by Utah contract law.
f. This agreement may be executed in one or more counterparts,
including electronic mail or facsimile, each of which may be
considered an original copy hereof. 6. Closing. The closing
hereunder shall take place not later than sixty (60) days after the
date of execution hereof, at such time and place as the parties
mutually agree.
7. Tax-free exchange. Insofar as possible, the parties agree that the exchange
of shares called for hereunder shall be a tax-free exchange under the tax laws
and the Internal Revenue Code (as amended) of the United States, and not a
purchase of assets.
8. Conditions to closing. The closing called for hereunder shall be subject to,
among other things: (a) the delivery to KINGS at closing of the BRIA share
certificates and the accounting information called for herein, in GAAP form; (b)
the conduct of due diligence of KINGS by BRIA or its agent, satisfactory to the
management of BRIA that the books, records, and assets of KINGS are in fact as
have been represented; (c) resolutions by the boards of directors of BRIA and
KINGS ratifying this transaction. This transaction is subject to BRIA accepting
KINGS's financial statements as being accurate, forthright and materially
correct in accordance with the representations made by KINGS to BRIA and, an
accredited audit acceptable to BRIA.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the day
and year first above written.
BRIA Communications Corporation
By: /s/ Richard Lifschutz
Richard Lifschutz, President
Kingslawn Offset, Inc.
By: /s/Josef M. Shimron
Josef M. Shimron, President
<PAGE>
10 (i)(m)
<PAGE>
STOCK EXCHANGE AGREEMENT
OMAP Holdings Incorporated
A Nevada Corporation
&
BRIA Communications Corp.
A New Jersey Corporation
<PAGE>
STOCK EXCHANGE AGREEMENT
This Stock Exchange Agreement ("Agreement") is entered into this 20th day
of December, 1995, by and between the purchaser OMAP Holdings Incorporated
("OMAP"), a Nevada Corporation, and seller, BRIA Communications Corp., a New
Jersey corporation ("BRIA").
WHEREAS, OMAP desires to acquire from BRIA appoximately Three Hundred
Seventy Thousand, Three Hundred Seventy (370,370) restricted shares of the
common stock of BRIA, in exchange for Seventy Thousand Five Hundred Eighty-eight
(70,588) shares of restricted shares of OMAP common stock.
NOW THEREFORE, with the above being incorporated into and made a part
hereof, for the mutual consideration set out herein and, the receipt and
sufficiency of which is hereby acknowleded, the parties agree as follows:
1. Exchange. OMAP will in a tax free exchange, acquire from BRIA Three Hundred
Seventy Thousand, Three Hundred Seventy (370,370) restricted shares of the
common stock of BRIA, valued as of December 15, 1995 at $0.81 per share, in a
tax free exchange wherein BRIA shall acquire Seventy Thousand Five Hundred
Eighty-eight (70,588) shares of restricted shares of OMAP common stock, valued
as of December 15, 1995 at $4.25 per shares of restricted OMAP common stock.
2. Exchange of Shares. On or before the closing date, set herein to be
December 24, 1995, the above mentioned shares are to be exchanged.
3. Termination. This Agreement may be terminated at any time prior to the
Closing Date:
A. By BRIA or OMAP:
(1) If there shall be any actual or threatened action or
proceeding by or before any court or any other governmental body
which shall seek to restrain, prohibit, or invalidate the
transactions contemplated by this Agreement and which, in the
judgment of such Board of Directors made in good faith, and based
upon the advice of legal counsel, makes it inadvisable to proceed
with the transactions comtemplated by this Agreement; or
(2) If the Closing shall not have occurred prior to December 29,
1995, or such later date as shall have been approved by parties
hereto, other than for reasons set forth herein.
B. By BRIA:
(1) If OMAP shall fail to comply in any material respect with
any of its or their covenants or agreements contained in this
Agreement or if any of the representations or warranties of BRIA
contained herein shall be inaccurate in any material respect; or
C. By OMAP:
(1) If BRIA shall fail to comply in any material respect with
any of its covenants or agreements contained in this Agreement or is
any of the representations or warranties of BRIA contained herein
shall be inaccurate in any material respect;
In the event this Agreement is terminated pursuant to this Paragraph, this
Agreement shall be of no further force or effect, no obligation, right, or
liability shall arise hereunder, and each party shall bear its own costs as well
as the legal, accounting, printing, and other costs incurred in connection with
negotiation, preparation, and execution of this Agreement and the transaction
herein contemplated.
<PAGE>
4. Representations and Warranties of BRIA. BRIA hereby represents and warrants
that effective this date and the Closing Date, the following representations are
true and correct:
A. Corporate Authority. BRIA has the full corporate power and authority
to enter into this Agreement and to carry out the transactions
contemplated by this Agreement. The Board of Directors of OMAP had
duly authorized the execution delivery, and performance of this
Agreement.
B. Financial Statements. The latest 10-Q report ("BRIAFinancials") have
been given to OMAP prior to closing.
C. No Conflict With Other Instruments. The executiont of this Agreement
will not violate or breach any document, instrument, agreement,
contract, or commitment material to the business of BRIA to which
BRIA is a party and has been duly authorized by all appropriate and
necessary action.
D. Information. The information concerning BRIA as set forth in this
Agreement and in the BRIA Financials is complete and accurate in all
material respects and does not contain any untrue statement of a
material fact or omit to state a material fact required to make the
statements made in light of the circumstatnces under which they were
made not misleading.
E. Deliverance of Shares. As of the Closing Date, the BRIA Shares to be
delivered to OMAP will be restricted and constitute valid and
legally issued shares of BRIA, fully paid and non-assessable and
equivalent in all respects to all other issued and outstanding
shares of BRIA restricted stock.
F. No Conflict with Other Instrument. The execution of this Agreement
will not violate or breach any document, instrument, agreement,
contract or commitment material to BRIA.
G. Information. The information concerning BRIA and set forth in this
Agreement, is complete and accurate in all material respects and
does not contain any untrue statement of a material fact or omit to
state a material fact required to make the statements made, in light
of the circumstances under which they were made, not misleading.
H. Restricted Shares. The shares of OMAP common stock which are being
acquired are being acquired for BRIA's own account and for
investment and not with a view to the public resale or distribution
thereof. BRIA will not sell, transfer or otherwise dispose of the
OMAP Shares are "restricted securities" as that term is defined in
Rule 144 of the General Rules and Regulations under the Act ("Rule
144").
BRIA acknowledged and understands that the OMAP Shares are
unregistered in reliance of Section 4(2) of the Act and must be held
indefinitely unless they are subsequently registered under the Act or
an exemption from such registration is available.
BRIA is fully aware of the applicable limitation on the resale
of the OMAP Shares. These restrictions for the most part are set
forth in Rule 144. Rule 144 permits sales of "restricted securities"
upon compliance with the requirements of such rule, If Rule 144 is
available to BRIA, BRIA may make only routine sales of securities in
limited amounts, in accordance with the terms and conditions of that
Rule.
If a separate exemption from registration is available to BRIA,
such as Regulation S, BRIA shall only make sales in accordance with
the terms and condiditons of that Regulation.
<PAGE>
5. Representations and Warranties of OMAP.
OMAP hereby represents and warrants that, effective this date and the
Closing Date, the representations and warranties listed below are true and
correct.
A. Corporate Authority. OMAP has the full corporate power and authority
to enter into this Agreement and to carr out the transactions
contemplated by this Agreement. The Board of Directors of OMAP has
duly authorized the execution, delivery, and performance of this
Agreement.
B. Financial Statements. The latest 10-Q report ("OMAP Financials")
have been given to BRIA prior to closing.
C. No Conflict With Other Instruments. The execution of this Agreement
will not violate or breach any document, instrument, agreement,
contract, or commitment material to the business of OMAP to which
OMAP is party and has been duly authorized by all appropriate and
necessary action.
D. Information. The information concerning OMAP as set forth in this
Agreement and in the OMAP Financial is complete and accurate in all
material respects and does not contain any untrue statement of a
material fact or omit to state a material fact required to make the
statements made in light of the circumstances under which they were
made not misleading.
E. Deliverance of Shares. As of the Closing Date, the OMAP Shares to be
deliverd to BRIA will be restricted and constitute valid and legally
issued shares of OMAP, fully paid and non-assessable and equivalent
in all respects to all other issued and outstanding shares of OMAP
rstricted stock.
F. No Conflict with Other Instrument. The execution of this Agreement
will not violate or breach any document, instrument, agreement,
contract, or commitment material to OMAP.
G. Information. The information concerning OMAP and set forth in this
Agreement, is complete and accurate in all material respects and
does not contain any untrue statement of a material fact or omit to
state a material fact required to make the statements made, in light
of the circumstances under which they were made, not misleading.
H. Restricted Shares. The shares of BRIA common stock which are being
acquired are being acquired for OMAP's own account and for investment
and not with a view to the public resale or distribution thereof.
OMAP will not sell, transfer or otherwise dispose of the BRIA Shares
except in compliance with the Securities Act of 1933, as amended (the
"Act"), and is aware the BRIA Shares are "restricted securities" as
that term is defined in Rule 144 of the General Rules and Regulations
under the Act ("Rule 144").
OMAP acknowledges and understands that the BRIA Shares are
unregistered in reliance of Seciton 4(2) of the Act and must be held
indefinitely unless they are subsequently registered under the Act or
an exemption from such registration is available.
OMAP is fully aware of the applicable limitation on the resale
of BRIA Shares. These restrictions for the most part are set forth in
Rule 144. Rule 144 permits sales of "restricted securities" upon
compliance with the requirements of such rule. If Rule 144 is
available to OMAP, OMAP may make only routine sales of securities in
limited amounts, in accordance witht the terms and conditions of that
Rule.
If a separate exemption from registration is available to OMAP,
such as Regulation S, Omap shall only make sales in accordance with
the terms and conditions of that Regulation.
6. Closing. The Closing as herein referred to shall occur upon such date as
the parties hereto may mutually agree upon, but is expected to be on or before
December 24, 1995.
At closing OMAP will deliver the OMAP shares to BRIA, and BRIA shall
deliver the BRIA shares to OMAP.
<PAGE>
7. Conditions Precedent of BRIA to Effect Closing. All obligations of BRIA
under this Agreement are subject to fulfillment prior to or as of the Closing
Date, of each of the following conditions:
A. The representations and warranties by or on behalf of OMAP contained
in this Agreement or in any certificate or documents delivered to
BRIA prusuant to the provisions hereof shall be true in all material
respects at and as of the time of Closing as though such
representations and warranties were made at and as of such time.
B. OMAP shall have performed and complied with all the covenants,
agreements, and conditions required by this Agreement to be performed
or complied with by it prior to or ath the Closing.
C. All instruments and documents delivered to BRIA pursuant to the
provisions hereof shall be reasonably satisfactory to BRIA's legal
counsel.
8. Conditions Precedent of OMAP to Effect Closing. All obligations of OMAP
under this Agreement are subject to fulfillment prior to or as of the date of
Closing, of each of the following conditions:
A. The representations and warranties by on on behalf of BRIA contained
in thei Agreement, or in any certificate or document delivered ot
OMAP pursuant to the provisions hereof shall be true at and as of the
time of Closing as though such representations and warranties were
made at and as of such time.
B. BRIA shall have performed and complied with all covenants,
agreements, and conditions required by this Agreement to be performed
or complied with by it prior to or at the Closing.
C. All instruments and documents delivered to OMAP pursuant to the
provisions hereof shall be reasonably satisfactory to OMAP's legal
counsel.
9. Damages and Limit of Liability. Each party shall be liable, for any material
breach of the representations, warranties, and covenants contained herein which
results in a failure to perform any obligations under this Agreement, but only
to the extent of the expenses incurred in connection with such breach of failure
to perform Agreement.
10. Nature and Survival of Representations and Warranties. All representations,
warranties, and covenants made by any party in this Agreement shall survive the
Closing hereunder. All of the parties hereto are executing and carrying out the
provisions of this Agreement in reliance solely on the representations,
warranties, and covenants and agreements contained in this Agreement or at the
Closing of the transactions herein provided for and not upon any investigation
upon which it might have made or any representations, warranty, agreement,
promise, or information, written or oral, made by the other party or any other
person other than as specifically set forth herein.
11. Indemnification Procedures. If any clain is made by a party which would give
rise to a right of indemnification under this paragraph, the party seeking
indemnification (Indemnified Party) will promptly cause notice thereof to be
delivered to the party from whom indemnification is sought (Indemnifying Party).
The Indemnified Party will permit the Indemnifying Party to assume the defense
of any such claim or any litigation reusulting from the claims. Counsel for the
Indemnifying Party which will conduct the defense must be approved by the
Indemnified Party (whose approval will not by unreasonably withheld), and the
Indemnified Party may participate in such defense at the expense of the
Indemnified Party. The Indemnifying Party will not in the defense of any such
claim or litigation, consent to entry of any judgment or enter into any
settlement without the written consent of the Indemnified Party (which consent
will not be unreasonably withheld). The Indemnified Party will not, in
connection with any such claim or litigation, consent to entry of any judgment
or enter into any settlement without the written consent of the Indemnifying
Party (which consent will not be unreasonably withheld). The Indemnified Party
will cooperate fully with the Indemnifying Party and make available to the
Indemnifying Party all pertinent information under its control relating to any
such claim or litigaton. If the Indemnifying Party refuses or fails to conduct
the defense as required in this Section, then the Indemnified Party may conduct
such defense at the expense of the Indemnifying Party and the approval of the
Indemnifying Party will not be required for any settlement or consent or entry
of judgment.
12. Default at Closing. Notwithstanding the provisions hereof, if BRIA shall
fail or refuse to deliver any of the BRIA Shares, or shall fail or refuse to
consummate the transaction described in this Agreement prior to the Closing
Date, such failure or refusal shall constitute a default by BRIA and OMAP at tis
option and without prejudice to its rights against such defaulting party, may
either (a) invoke any equitable remedies to enforce performance hereunder,
including, without limitation, an action or suit for specific performance, or
(b) terminate all of its obligations hereunder with respect to BRIA.
Furthermore, notwithstanding the provisions hereof, if OMAP shall fail to
deliver any of the OMAP Shares, or shall fail or refuse to consummate the
transaction described in this Agreement prior to the Closing Date, such failure
or refusal shall constitute a default by OMAP and BRIA at its option and without
prejudice to its rights against such defaulting party, may either (a) invoke any
equitable remedies to enforce performance hereunder, including, without
limitation, an action or suit for specific performance, or (b) terminate all of
its obligations hereunder with respect to OMAP.
13. Costs and Expenses. BRIA and OMAP shall bear their own costs and expenses in
the proposed exchangee and transfer described in this Agreement. BRIA and OMAP
have been represented by their own attorney in this transactions, and shall pay
the fees of its attorney, except as may be expressly set forth herein to the
contrary.
14. Notices. Any notice under this Agreement shall be deemed to have been
sufficiently given if sent by registered or certified mail, postage prepaid,
addressed as follows:
To OMAP
OMAP Holdings Incorporated
268 West 400 South, Suite 300
Salt Lake City, UT 84101
To BRIA
BRIA Communications Corporation
268 West 400 South, Suite, 300
Salt Lake City, UT 84101
15. Miscellaneous.
A. Further Assurances. At any time and from time to time, after the
effective date, each party 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.
B. Waiver. Any failure on the part of any party hereto 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.
C. Brokers. Neither party has employed any brokers or finders with
regard to this Agreement no disclosed herein.
D. Headings. The Section and subsection headings in this Agreement are
inserted for convenience only and shll not affect in any way the
meaning or interpretation of this Agreement.
E. 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.
F. Governing Law. This Agreement was negotiated and is being contracted
for in the State of Utah, and shall be governed by the laws of the
State of Utah, notwithstanding any conflict -of-law provision to the
contrary. Any suit, action or legal proceeding arising from or
related to this Agreement shall be submitted for binding arbitration
resolution to the American Arbitration Association, in Salt Lake
City, Utah, pursuant to their Rules of Procedure or any other
mutually agreed upon arbitrator. The Parties agree to abide by
decisions rendered as final and binding, and each party irrevocably
and unconditionally consents to the personam jurisdiction of such
Courts in such suit, action or legal proceeding and waives any
objection to the laying of venue in, or the jurisdiction of, said
Courts.
<PAGE>
G. Binding Effect. This Agreement shall be binding upon the parties
hereto and inure to the benefit of the parties, their respective
heirs, administrators, executors, successors, and assigns.
H. 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 hereof. 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.
I. Severability. If any part of this Agreement is deemed to be
unenforceable the balance of the Agreement shall remain in full
force and effect.
IN WITNESS WHEREOF, the parties have executed this Agreement the day and
year first above written.
OMAP Holdings Incorporated
By: /s/ James Tilton, President
- ----------------------------------
BRIA Communications Corp.
By: /s/ Richard Lifschutz
- ---------------------------
<PAGE>
10 (i)(n)
<PAGE>
STOCK EXCHANGE AGREEMENT
Eurotronics Holdings Incorporated
A Utah Corporation
&
BRIA Communications Corp.
A New Jersey Corporation
<PAGE>
STOCK EXCHANGE AGREEMENT
This Stock Exchange Agreement ("Agreement") is entered into this 20th day
of December, 1995, by and between the purchaser Eurotronics Holdings
Incorporated ("Eurotronics"), a Utah Corporation, and seller, BRIA
Communications Corp., a New Jersey corporation ("BRIA").
WHEREAS, Eurotronics desires to acquire from BRIA appoximately Three
Hundred Seventy Thousand, Three Hundred Seventy (370,370) restricted shares of
the common stock of BRIA, in exchange for Five Hundred Sixty-six Thousand
Thirty-eight (566,038) shares of restricted shares of Eurotronics common stock.
NOW THEREFORE, with the above being incorporated into and made a part
hereof, for the mutual consideration set out herein and, the receipt and
sufficiency of which is hereby acknowleded, the parties agree as follows:
1. Exchange. Eurotronics will in a tax free exchange, acquire from BRIA Three
Hundred Seventy Thousand, Three Hundred Seventy (370,370) restricted shares of
the common stock of BRIA, valued as of December 15, 1995 at $0.81 per share, in
a tax free exchange wherein BRIA shall acquire Five Hundred Sixty-six Thousand
Thirty-eight (566,038) shares of restricted shares of Eurotronics common stock,
valued as of December 15, 1995 at $0.53 per shares of restricted Eurotronics
common stock.
2. Exchange of Shares. On or before the closing date, set herein to be
December 24, 1995, the above mentioned shares are to be exchanged.
3. Termination. This Agreement may be terminated at any time prior to the
Closing Date:
A. By BRIA or Eurotronics:
(1) If there shall be any actual or threatened action or proceeding by
or before any court or any other governmental body which shall seek
to restrain, prohibit, or invalidate the transactions contemplated
by this Agreement and which, in the judgment of such Board of
Directors made in good faith, and based upon the advice of legal
counsel, makes it inadvisable to proceed with the transactions
comtemplated by this Agreement; or
(2) If the Closing shall not have occurred prior to December 29, 1995,
or such later date as shall have been approved by parties hereto,
other than for reasons set forth herein.
B. By BRIA:
(1) If Eurotronics shall fail to comply in any material respect with any
of its or their covenants or agreements contained in this Agreement
or if any of the representations or warranties of BRIA contained
herein shall be inaccurate in any material respect; or
C. By Eurotronics:
(2) If BRIA shall fail to comply in any material respect with any of its
covenants or agreements contained in this Agreement or is any of the
representations or warranties of BRIA contained herein shall be
inaccurate in any material respect;
In the event this Agreement is terminated pursuant to this Paragraph, this
Agreement shall be of no further force or effect, no obligation, right, or
liability shall arise hereunder, and each party shall bear its own costs as well
as the legal, accounting, printing, and other costs incurred in connection with
negotiation, preparation, and execution of this Agreement and the transaction
herein contemplated.
<PAGE>
4. Representations and Warranties of BRIA. BRIA hereby represents and warrants
that effective this date and the Closing Date, the following representations are
true aNd correct:
A. Corporate Authority. BRIA has the full corporate power and authority
to enter into this Agreement and to carry out the transactions
contemplated by this Agreement. The Board of Directors of
Eurotronics had duly authorized the execution delivery, and
performance of this Agreement.
B. Financial Statements. The latest 10-Q report ("BRIAFinancials") have
been given to Eurotronics prior to closing.
C. No Conflict With Other Instruments. The executiont of this Agreement
will not violate or breach any document, instrument, agreement,
contract, or commitment material to the business of BRIA to which
BRIA is a party and has been duly authorized by all appropriate and
necessary action.
D. Information. The information concerning BRIA as set forth in this
Agreement and in the BRIA Financials is complete and accurate in all
material respects and does not contain any untrue statement of a
material fact or omit to state a material fact required to make the
statements made in light of the circumstatnces under which they were
made not misleading.
E. Deliverance of Shares. As of the Closing Date, the BRIA Shares to be
delivered to Eurotronics will be restricted and constitute valid and
legally issued shares of BRIA, fully paid and non-assessable and
equivalent in all respects to all other issued and outstanding
shares of BRIA restricted stock.
F. No Conflict with Other Instrument. The execution of this Agreement
will not violate or breach any document, instrument, agreement,
contract or commitment material to BRIA.
G. Information. The information concerning BRIA and set forth in this
Agreement, is complete and accurate in all material respects and
does not contain any untrue statement of a material fact or omit to
state a material fact required to make the statements made, in light
of the circumstances under which they were made, not misleading.
H. Restricted Shares. The shares of Eurotronics common stock which are
being acquired are being acquired for BRIA's own account and for
investment and not with a view to the public resale or distribution
thereof. BRIA will not sell, transfer or otherwise dispose of the
Eurotronics Shares are "restricted securities" as that term is
defined in Rule 144 of the General Rules and Regulations under the
Act ("Rule 144").
BRIA acknowledged and understands that the Eurotronics Shares
are unregistered in reliance of Section 4(2) of the Act and must be
held indefinitely unless they are subsequently registered under the
Act or an exemption from such registration is available.
BRIA is fully aware of the applicable limitation on the resale
of the Eurotronics Shares. These restrictions for the most part are
set forth in Rule 144. Rule 144 permits sales of "restricted
securities" upon compliance with the requirements of such rule, If
Rule 144 is available to BRIA, BRIA may make only routine sales of
securities in limited amounts, in accordance with the terms and
conditions of that Rule.
If a separate exemption from registration is available to BRIA,
such as Regulation S, BRIA shall only make sales in accordance with
the terms and condiditons of that Regulation.
<PAGE>
5. Representations and Warranties of Eurotronics.
Eurotronics hereby represents and warrants that, effective this date and
the Closing Date, the representations and warranties listed below are true
and correct.
A. Corporate Authority. Eurotronics has the full corporate power and
authority to enter into this Agreement and to carr out the
transactions contemplated by this Agreement. The Board of Directors
of Eurotronics has duly authorized the execution, delivery, and
performance of this Agreement.
B. Financial Statements. The latest 10-Q report ("Eurotronics
Financials") have been given to BRIA prior to closing.
C. No Conflict With Other Instruments. The execution of this Agreement
will not violate or breach any document, instrument, agreement,
contract, or commitment material to the business of Eurotronics to
which Eurotronics is party and has been duly authorized by all
appropriate and necessary action.
D. Information. The information concerning Eurotronics as set forth in
this Agreement and in the Eurotronics Financial is complete and
accurate in all material respects and does not contain any untrue
statement of a material fact or omit to state a material fact
required to make the statements made in light of the circumstances
under which they were made not misleading.
E. Deliverance of Shares. As of the Closing Date, the Eurotronics Shares
to be deliverd to BRIA will be restricted and constitute valid and
legally issued shares of Eurotronics, fully paid and non-assessable
and equivalent in all respects to all other issued and outstanding
shares of Eurotronics rstricted stock.
F. No Conflict with Other Instrument. The execution of this Agreement
will not violate or breach any document, instrument, agreement,
contract, or commitment material to Eurotronics.
G. Information. The information concerning Eurotronics and set forth in
this Agreement, is complete and accurate in all material respects
and does not contain any untrue statement of a material fact or omit
to state a material fact required to make the statements made, in
light of the circumstances under which they were made, not
misleading.
H. Restricted Shares. The shares of BRIA common stock which are being
acquired are being acquired for Eurotronics's own account and for
investment and not with a view to the public resale or distribution
thereof. Eurotronics will not sell, transfer or otherwise dispose of
the BRIA Shares except in compliance with the Securities Act of
1933, as amended (the "Act"), and is aware the BRIA Shares are
"restricted securities" as that term is defined in Rule 144 of the
General Rules and Regulations under the Act ("Rule 144").
Eurotronics acknowledges and understands that the BRIA Shares
are unregistered in reliance of Seciton 4(2) of the Act and must be
held indefinitely unless they are subsequently registered under the
Act or an exemption from such registration is available.
Eurotronics is fully aware of the applicable limitation on the
resale of BRIA Shares. These restrictions for the most part are set
forth in Rule 144. Rule 144 permits sales of "restricted securities"
upon compliance with the requirements of such rule. If Rule 144 is
available to Eurotronics, Eurotronics may make only routine sales of
securities in limited amounts, in accordance witht the terms and
conditions of that Rule.
If a separate exemption from registration is available to
Eurotronics, such as Regulation S, Eurotronics shall only make sales
in accordance with the terms and conditions of that Regulation.
6. Closing. The Closing as herein referred to shall occur upon such date as
the parties hereto may mutually agree upon, but is expected to be on or before
December 24, 1995.
<PAGE>
At closing Eurotronics will deliver the Eurotronics shares to BRIA, and
BRIA shall deliver the BRIA shares to Eurotronics.
7. Conditions Precedent of BRIA to Effect Closing. All obligations of BRIA
under this Agreement are subject to fulfillment prior to or as of the Closing
Date, of each of the following conditions:
A. The representations and warranties by or on behalf of Eurotronics
contained in this Agreement or in any certificate or documents
delivered to BRIA prusuant to the provisions hereof shall be true in
all material respects at and as of the time of Closing as though
such representations and warranties were made at and as of such
time.
B. Eurotronics shall have performed and complied with all the
covenants, agreements, and conditions required by this Agreement to
be performed or complied with by it prior to or ath the Closing.
C. All instruments and documents delivered to BRIA pursuant to the
provisions hereof shall be reasonably satisfactory to BRIA's legal
counsel.
8. Conditions Precedent of Eurotronics to Effect Closing. All obligations of
Eurotronics under this Agreement are subject to fulfillment prior to or as of
the date of Closing, of each of the following conditions:
A. The representations and warranties by on on behalf of BRIA contained
in thei Agreement, or in any certificate or document delivered ot
Eurotronics pursuant to the provisions hereof shall be true at and
as of the time of Closing as though such representations and
warranties were made at and as of such time.
B. BRIA shall have performed and complied with all covenants,
agreements, and conditions required by this Agreement to be
performed or complied with by it prior to or at the Closing.
C. All instruments and documents delivered to Eurotronics pursuant to
the provisions hereof shall be reasonably satisfactory to
Eurotronics's legal counsel.
9. Damages and Limit of Liability. Each party shall be liable, for any
material breach of the representations, warranties, and covenants contained
herein which results in a failure to perform any obligations under this
Agreement, but only to the extent of the expenses incurred in connection with
such breach of failure to perform Agreement.
10. Nature and Survival of Representations and Warranties. All
representations, warranties, and covenants made by any party in this Agreement
shall survive the Closing hereunder. All of the parties hereto are executing and
carrying out the provisions of this Agreement in reliance solely on the
representations, warranties, and covenants and agreements contained in this
Agreement or at the Closing of the transactions herein provided for and not upon
any investigation upon which it might have made or any representations,
warranty, agreement, promise, or information, written or oral, made by the other
party or any other person other than as specifically set forth herein.
11. Indemnification Procedures. If any clain is made by a party which would
give rise to a right of indemnification under this paragraph, the party seeking
indemnification (Indemnified Party) will promptly cause notice thereof to be
delivered to the party from whom indemnification is sought (Indemnifying Party).
The Indemnified Party will permit the Indemnifying Party to assume the defense
of any such claim or any litigation reusulting from the claims. Counsel for the
Indemnifying Party which will conduct the defense must be approved by the
Indemnified Party (whose approval will not by unreasonably withheld), and the
Indemnified Party may participate in such defense at the expense of the
Indemnified Party. The Indemnifying Party will not in the defense of any such
claim or litigation, consent to entry of any judgment or enter into any
settlement without the written consent of the Indemnified Party (which consent
will not be unreasonably withheld). The Indemnified Party will not, in
connection with any such claim or litigation, consent to entry of any judgment
or enter into any settlement without the written consent of the Indemnifying
Party (which consent will not be unreasonably withheld). The Indemnified Party
will cooperate fully with the Indemnifying Party and make available to the
Indemnifying Party all pertinent information under its control relating to any
such claim or litigaton. If the Indemnifying Party refuses or fails to conduct
the defense as required in this Section, then the Indemnified Party may conduct
such defense at the expense of the Indemnifying Party and the approval of the
Indemnifying Party will not be required for any settlement or consent or entry
of judgment.
<PAGE>
12. Default at Closing. Notwithstanding the provisions hereof, if BRIA shall
fail or refuse to deliver any of the BRIA Shares, or shall fail or refuse to
consummate the transaction described in this Agreement prior to the Closing
Date, such failure or refusal shall constitute a default by BRIA and Eurotronics
at tis option and without prejudice to its rights against such defaulting party,
may either (a) invoke any equitable remedies to enforce performance hereunder,
including, without limitation, an action or suit for specific performance, or
(b) terminate all of its obligations hereunder with respect to BRIA.
Furthermore, notwithstanding the provisions hereof, if Eurotronics shall fail to
deliver any of the Eurotronics Shares, or shall fail or refuse to consummate the
transaction described in this Agreement prior to the Closing Date, such failure
or refusal shall constitute a default by Eurotronics and BRIA at its option and
without prejudice to its rights against such defaulting party, may either (a)
invoke any equitable remedies to enforce performance hereunder, including,
without limitation, an action or suit for specific performance, or (b) terminate
all of its obligations hereunder with respect to Eurotronics.
13. Costs and Expenses. BRIA and Eurotronics shall bear their own costs and
expenses in the proposed exchangee and transfer described in this Agreement.
BRIA and Eurotronics have been represented by their own attorney in this
transactions, and shall pay the fees of its attorney, except as may be expressly
set forth herein to the contrary.
14. Notices. Any notice under this Agreement shall be deemed to have been
sufficiently given if sent by registered or certified mail, postage prepaid,
addressed as follows:
To Eurotronics
Eurotronics Holdings Incorporated
268 West 400 South, Suite 300
Salt Lake City, UT 84101
To BRIA
BRIA Communications Corporation
268 West 400 South, Suite, 300
Salt Lake City, UT 84101
15. Miscellaneous.
A. Further Assurances. At any time and from time to time, after the
effective date, each party 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.
B. Waiver. Any failure on the part of any party hereto 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.
C. Brokers. Neither party has employed any brokers or finders with
regard to this Agreement no disclosed herein.
D. Headings. The Section and subsection headings in this Agreement are
inserted for convenience only and shll not affect in any way the
meaning or interpretation of this Agreement.
E. 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.
<PAGE>
F. Governing Law. This Agreement was negotiated and is being contracted
for in the State of Utah, and shall be governed by the laws of the
State of Utah, notwithstanding any conflict -of-law provision to the
contrary. Any suit, action or legal proceeding arising from or
related to this Agreement shall be submitted for binding arbitration
resolution to the American Arbitration Association, in Salt Lake
City, Utah, pursuant to their Rules of Procedure or any other
mutually agreed upon arbitrator. The Parties agree to abide by
decisions rendered as final and binding, and each party irrevocably
and unconditionally consents to the personam jurisdiction of such
Courts in such suit, action or legal proceeding and waives any
objection to the laying of venue in, or the jurisdiction of, said
Courts.
G. Binding Effect. This Agreement shall be binding upon the parties
hereto and inure to the benefit of the parties, their respective
heirs, administrators, executors, successors, and assigns. H. 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 hereof. 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.
I. Severability. If any part of this Agreement is deemed to be
unenforceable the balance of the Agreement shall remain in full
force and effect.
IN WITNESS WHEREOF, the parties have executed this Agreement the day and
year first above written.
Eurotronics Holdings Incorporated
By: /s/ Jane Zheng, Secretary
- -------------------------------
BRIA Communications Corp.
By: /s/ Richard Lifschutz
- ---------------------------
<PAGE>
10 (i)(o)
<PAGE>
STOCK EXCHANGE AGREEMENT
BRIA Communications Corp.
A New Jersey Corporation
&
Tianrong Building Material Holdings, Ltd. Inc.
A Utah Corporation
<PAGE>
STOCK EXCHANGE AGREEMENT
This Stock Exchange Agreement ("Agreement") is entered into this 20th day
of Decemebr, 1995 bey and between the purchaser BRIA Communication Corp.,
("BRIA") a New Jersey corporaiton, and seller, Tianrong Building Materials
Holdings Ltd., a Utah corporation ("Tianrong").
WHEREAS, BRIA desires to acquire from Tianrong approximately Three Hundred
Ninteen Thousand, One Hundred forty-nine (319,149) restricted shares of the
common stock of Tianrong, in exchange for Three Hundered Seventy Thousand Three
Hundred Seventy (370,370) shares of restricted shares of 370,370 common stock.
NOW, THEREFORE with the above being incorporated into and made a part
hereof for the mutual consideration set out herein and, the receipt and
sufficiency of which is hereby acknowledged, the parties agree as follows: 1.
Exchange. BRIA will, in a tax free exchange, acquire from Tianrong, Three
Hundred Nineteen Thousand, One Hundred Forty-nine (319,149) restricted shares of
the common stock of Tianrong, valued as of December 15, 1995 at $.094 per share,
in a tax free exchange wherein Tianrong shall acquire Three Hundred Seventy
Thousand Three Hundred Seventy (370,370) shares of restricted shares of BRIA
common stock, valued as of December 15, 1995 at $0.81 per share of restricted
BRIA common stock.
2. Exchange of Shares. On or before the closing date, set herein to be
December 24, 1995, the above-mentioned shares are to be exchanged.
3. Termination. This Agreemnet may ber terminated at any time prior to the
Closing Date:
A. By Tianrong or BRIA:
(1) If there shall be any actual or threatened action or proceeding
by or before any court or any other governmental vbody which shall
seek to restrain, prohibit, or invalidate the transactions
contemplated by this Agreement and which, in judgement of such Board
of Directors made in good faithm and based upon the advice of legal
counsel, makes it inadvisable to proceed with the transactions
contemplated by the Agreement; or
(2) If the Closing shall have not ocurred prior to December 29,
1995, or such later date as shall have been approved by parties
hereto, other than for reasons set forth herein.
B. By Tianrong:
(1) If BRIA shall fail to comply in any material respect with any of
its or their covenenats or agreements contained in this Agreement or
if any of the representatition or warranties of BRIA contained
herein shall be inaccurate in any material respect; or
C. By BRIA:
(1) If Tianrong shall fail to comply in any material respect with
any of its covenenants or agreements contained in this Agreement of
if any of the representation or warranties of Tianrong contained
herein shall be inaccurate in any material respect;
In the event this Agreement is terminated pursuant to this Paragraph, this
Agreement shall be of no further force or effect, no obligation, right, or
liability shall arise hereunder, and each party shall bearits own costs as well
as the legal, accounting, printing, and other costs incurred in connection with
negotiation, preparation and executio of the Agreement and the transactions
herein contemplated.
4. Representations and Warranties of Tianrong. Tianrong hereby represents
and warrants that effective this date and the Closing Date, the following
representations are true and correct:
<PAGE>
A. Corporate Authority. Tianrong has the full corporate power and
authority to enter this Agreement and to carry out the transactions
cont4emplated by this Agreement. The Board of Directors of BRIA has
duly authorized the execution, delivery and performance of this
Agreement.
B. Financial Statements. The latest 10-Q report ("Tianrong Financials")
have been given to BRIA prior to closing.
C. No Conflict With Other Instruments. The execution of this Agreement
will not violate or breach any document, instrument, agreement,
contract, or commitment material to the business of Tianrong to
which Tianrong is a party and has been duly authorized by all
appropriated and necessary action.
D. Innformation. The information concerning Tianrong as set forth in
this Agreement and in the Tianrong Financials is complete and
accurate in all material respects and does not contain any untrue
statement of a material fact or omit to state a material fact
required to make the statements made in light of the circumstances
under which they were made not misleading.
E. Deliverance of Shares. As of the Closing Date, the Tianrong Shares
to be delivered to BRIA will be restricted and constitute valid and
legally issued shares of Tianrong, fully paid and non-assessable and
equivalent in all respects to all other issued and outstanding
shares of Tianrong restricted stock.
F. No Conflict with Other Instrument. The execution of this agreement
will not violate or breach any document, instrument, agreement,
contract or commitment material to Tianrong.
G. Information. The information concerning Tianrong and set forth in
this Agreement, is complete and accurate in all material respects
and does not contain any untreu statement of a material fact or omit
to state a material fact required to make the statements made, in
light of the circumstances under which they were made, not
misleading.
H. Restricted Shares. The shares of BRIA common stock which are being
acquired for Tianrong's own account and for investment and not with
a view to the public resale or distribution thereof. Tianrong will
not sell, transfer or otherwise dispose of athe BRIA Shares except
in compliance with the Securities Act of 1933, as amended (the
"Act"), and is aware the BRIA Shares are "restricted securities" as
that term is defined in Rule 144 of the General Rules and
Regulations under the Act ("Rule 144")
Tianrong acknowledges and understands that the BRIA Shares are
unregistered in reliance of Section 4(2) of the Act and must be held
indefinitely unless they are subsequently registered under the Act
or an exemption from such registration is available.
Tianrong is fully aware of the applicable limitation on the resale
of the BRIA Shares. These restrictions for the most part are set
forth in Rule 144. Rule 144 permits sales of "resticted securities"
upon compliance with the requirements of such rule. If Rule 144 is
available to Tianrong, Tianrong may make only routine sales of
securities in limited amounts, in accordance with the terms and
conditions of that Rule.
If a separate exemption from registration os available to Tianrong,
such as Regulation S, Tianrong shall only make sales in accordance
with the terms and conditions of that Regulation.
<PAGE>
5. Representations and Warranties of BRIA.
BRIA hereby represents and warrants that, effective this date and the
Closing Date, the representations and warranties listed below are true and
correct.
A. Corporate Authority. BRIA has the full corporate power and authority
to enter this Agreement and to carry out the transactions
contemplated by this Agreement. The Board of Directors of BRIA has
duly authorized the execution, delivery, and performance of this
Agreement.
B. Financial Statements. The latest 10-Q report ("BRIA Financials")
have been given to Tianrong prior to closing.
C. No Conflict With Other Instruments. The execution of this Agreement
will not violate or breach any document, instrument, agreement,
contract, or commitment material to the business of BRIA to which
BRIA is a party and has been duly authorized by all appropriated and
necessary action.
D. Innformation. The information concerning BRIA as set forth in this
Agreement and in the BRIA Financials is complete and accurate in all
material respects and does not contain any untrue statement of a
material fact or omit to state a material fact required to make the
statements made in light of the circumstances under which they were
made not misleading.
E. Deliverance of Shares. As of the Closing Date, the BRIA Shares to be
delivered to Tianrong will be restricted and constitute valid and
legally issued shares of BRIA fully paid and non-assessable and
equivalent in all respects to all other issued and outstanding
shares of BRIA restricted stock.
F. No Conflict with Other Instrument. The execution of this agreement
will not violate or breach any document, instrument, agreement,
contract or commitment material to BRIA.
G. Information. The information concerning BRIA and set forth in this
Agreement, is complete and accurate in all material respects and
does not contain any untreu statement of a material fact or omit to
state a material fact required to make the statements made, in light
of the circumstances under which they were made, not misleading.
H. Restricted Shares. The shares of Tianrong common stock which are
being acquired for BRIA's own account and for investment and not
with a view to the public resale or distribution thereof. BRIA will
not sell, transfer or otherwise dispose of the Tianrong Shares
except in compliance with the Securities Act of 1933, as amended
(the "Act"), and is aware the Tianrong Shares are "restricted
securities" as that term is defined in Rule 144 of the General Rules
and Regulations under the Act ("Rule 144")
BRIA acknowledges and understands that the Shares are unregistered
in reliance of Section 4(2) of the Act and must be held indefinitely
unless they are subsequently registered under the Act or an
exemption from such registration is available.
BRIA is fully aware of the applicable limitation on the resale of
the BRIA Shares. These restrictions for the most part are set forth
in Rule 144. Rule 144 permits sales of "resticted securities" upon
compliance with the requirements of such rule. If Rule 144 is
available to BRIA, BRIA may make only routine sales of securities in
limited amounts, in accordance with the terms and conditions of that
Rule.
If a separate exemption from registration os available to BRIA such
as Regulation S, BRIA shall only make sales in accordance with the
terms and conditions of that Regulation.
6. Closing. The Closing as herein referred to shall occur upon such date as
the parties hereto may mutually agree upon, but is expected to be on or before
December 24, 1995. At closing BRIA will deliver the BRIA Shares to Tianrong, and
Tianrong shall deliver the Tianrong Shares to BRIA.
<PAGE>
7. Conditions Precedent of Tianrong to Effect Closing. All obligations of
Tianrong under this Agreement are subject to fullfillment prior to or as of the
Closing Date, of each of the following conditions:
A. The representations and warranties by or on behalf of BRIA contained
in this Agreement or in any certificate or documents delivered to
Tianrong pursuant to the provisions hereof shall be true in all
material respects at end as of the time of Closing as though such
represenations and warranties were made at and as of such time.
B. BRIA shall have performed and complied with all coevenants,
agreements and coditiions required by this Agreement to be performed
or complied with by it prior to or at the Closing.
C. All instruments and documents delivered to Tianrong pursuant to the
provisions hereof shall be reasonably satisfacory to Tianrong's
legal counsel.
8. Conditions Precedent of BRIA to Effect Closing. All obligations of BRIA
under this Agreement are subject to fulfillment prior to or as of the date of
Closing, of each of the following conditions:
A. The representations and warranties by or on behalf of Tianrong
contained in this Agreement or in any certificate or documents
delivered to BRIA pursuant to the provisions hereof shall be true in
all material respects at end as of the time of Closing as though
such represenations and warranties were made at and as of such time.
B. Tianrong shall have performed and complied with all coevenants,
agreements and coditiions required by this Agreement to be performed
or complied with by it prior to or at the Closing.
C. All instruments and documents delivered to BRIA pursuant to the
provisions hereof shall be reasonably satisfacory to BRIA's legal
counsel.
9. Damages and Limit of Liabiility. Each party shall be liable, for any
material breach of the representations, warranties, and covenants contained
herein whcih results in a failure to perform any obligation under this
Agreement, ut onlt to the extent of the expenses incurred in connection with
such breach or failfire to perform Agreement.
10. Nature and Survival of Representations and Warranties. All
representations, warranties and covenants made by any party in this Agreement
shall survive the Closing hereunder. All of the parties hereto are executing and
carrying out the provisions of this Agreement in reliance solely on the
representations, warranties and voenenats and agreements contained in this
Agreement or at the Closing of the transactions herein providied for and not
upon any investigation upon which it might have made or any represenations,
warranty, agreement, promise, or information, written or oral, made by the other
party or any other person other than as specifically set forth herein.
11. Indemnification Procedures. If any claim is made by a party which would
give rise to a right of indemnification under this paragraph, the party seeking
indemnification (Indeminified Party) will promptly cause notice thereof to be
delivered to the party from whom is sought (Indemnnifying Party). The
Indemnified Party will permit the Indemnifying Party to assume the defense of
any such claim or any litigation resulting from the claims. Counsel for the
Indemnifyuing Party which will conduct the defense must be approved by the
Indemnified Party (whose approval will not be unreasonable withheld), and the
Indemnified Party may participate in such defense at the expense of the
Indemnified Party. The indemnifying Party will notm in the defense of any such
claim or litigation, consent to enty of any judgement or enter into any
settlement without the written consent of the the Indemnified Party (which
consent will not be unreasonably withheld). The Indemnified Party will not, in
connection with any such claim or litigation, consent to entry of any judgement
or enter into any settlement without the written consent of the Indemnifying
Party (which consent will not be unreasnoable withheld). The Indemnified Party
will cooperate fully with the Indemnifying Party and make available to the
Indemnifying Party all pertinent information under its control relating to any
such claim or litigation. If the Indemnifying Party refuses or fails to conduct
the defense as required in this Section, then the Indemnified Party may conduct
such defense at the expense of the the Indemnifying Party and the approval of
the Indemnifying Party will not be required for any settlement or consent or
enty of judgement.
12. Default at Closing. Notwithstanding the provisions hereof, if Tianrong
shall fail or refuse to deliver any of the Tianrong Shares, or shall fail or
refuse to consummate the transaction described in this Agreement prior to the
Closing Date, such failure or refusal shall constitute a default by Tianrong and
BRIA at its option and without predjudice to its rights against such defaulting
party, may either (a) invoke any equitable remedies to enforce performance
hereunder including, without limitation, an action or suit for specific
performance, or (b) terminate all of its obligations hereunder with respect to
Tianrong.
<PAGE>
13. Costs and Expenses. Tianrong and BRIA shall bear their own costs and
expenses in the proposed exchange and transfer described in this Agreement.
Tianrong and BRIA have been represented by their own attorney in this
transaction, and shall pay the fees of its attorney, except as may be expressly
set forth herein to the contrary.
14. Notices. Any notice under this Agreement shall be deemed to have been
sufficiently giv4en if sent by registered or certified mail, postage prepaid,
addressed as follows:
To BRIA:
BRIA Communications Corp.
` 268 West 400 South, Suite 300
Salt Lake City, UT 84101
To Tianrong
Tianrong Building Material Holdings, Ltd. Inc.
268 West 400 South, Suite 300
Salt Lake City, UT 84101
15. Miscellaneous.
A. Further Assurances. At any time and from time to time, after the
effective date, each party will execute such additional instruments and take
such as may be reasonable request4d 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.
B. Waiver. Any failure on the part of any party hereto 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.
C. Brokers. Neither party has employed any brokers or finders with regard
to this Agreement no disclosed herein.
D. 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.
E. 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.
F. Governing Law. This Agreement was negotiated and is being contracted
for in the State of Utah, and shall be governed by the las of the State of Utah,
notwithstanding any conflict-of-law provision to the contrary. Any suit, action
or legal proceeding arising from or related to this Agreement shall be submitted
for binding arbitration resolution to the American Arbitration Association, in
Salt Lake City, Utah, pursuant to their Rules of Procedure or any other mutually
agreed upon arbitrator. The parties atree to abide by decisions rendered as
final and binding, and each party irrevocably and incondtionally consents to the
in personam jurisdiction of such Courts in such suit, action or legal proceeding
and waives any objection to the laying of venue in, or the jurisdiction of, said
Courts.
G. Binding Effect. This Agreement shall be binding upon the parties
hereto and inure to the benefit of the partiesm their respective heirsm
administrators, executors, successors, and assigns.
H. Entire Agreement. The 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 hereof. No
oral understandings, statements, promises or inducements contrary to the terms
of this Agreement exist. No representations, warranties covenenats, or
conditions express or implied, other that s set forth here, have been made by
any party.
<PAGE>
I. Severability. If any part of this Agreement is deemed to be
unenforceable the balance of the Agreement shall remain in full force and
effect.
IN WITNESS WHEREOF, the parties have executed this Agreement the day and year
first above written
BRIA Communications Corp.
By:/S/ Richard Lifschutz
-------------------------
Tianrong Building Material Holdings Ltd., Inc.
By:/S/ Matt Veal
----------------
<PAGE>
10 (i)(p)
<PAGE>
STOCK PURCHASE AGREEMENT
THIS STOCK PURCHASE AGREEMENT ("Agreement") is made effective as of the
15th day of January, 1996, by an between OMAP Holdings Incorporated, a Nevada
corporation (the"Company") , and BRIA Communications Corp., a New Jersey
corporation (the "Purchaser").
Recitals
The Company desires to sell and transfer, and Purchaser desires to
purchase and acquire, Two Thousand Eight Hundred Fifty Eight (2,858) shares of
the Company's common stock, par value $0.0001 per share (the "Shares"), to
Purchaser in a private non-registered and non-exempt transaction at the purchase
price of $10,000, or $3.50 per share, on the terms and conditions set forth
below.
Agreement
1. Sale of Shares. The Company agrees to issue the Shares to Purchaser, and
Purchaser agrees to purchase the Shares from the Company. Immediately
after the Company receives a duly executed copy of this Agreement and
payment of the purchase price as set forth in Section 2 herein, it will
cause its agent to deliver a certificate for the Shares to Purchaser.
2. Purchase Price. The purchase price for the Shares is $3.50 per share for
a total price of $10,000, cash (the "Purchase Price").
3. Representation and Warranties of Purchaser. Purchaser represents and
warrants that:
a. Purchaser is an entity incorporated in the United States of America.
b. Purchaser is acquiring the Shares for its own account and not with a
view to any distribution within the meaning of the Securities Act of
1933, as amended (the "Act"). Purchaser acknowledges that it has been
advised and is aware that the Shares have not been registered under
the Act and are being issued as "restricted stock" within the meaning
of Rule 144 promulgated by the United States Securities and Exchange
Commission ("SEC") pursuant to the Act ("Rule 144"). Unless, and
until, the Shares are registered under the Act, they will be subject
to limitations upon resale set forth in Rule 144 or in other
administrative interpretations by the SEC in effect at the time of
the proposed sale or other disposition.
c. Purchaser has received all of the information it considers necessary
or appropriate for determining whether to purchase the Shares.
Purchaser is familiar with the business, affairs, risks and
properties of the Company. Purchaser has had an opportunity to ask
questions regarding the Company and the terms and conditions of the
offering of the Shares and receive such answers from the Company, its
officers, directors and other representatives. Purchaser has had the
opportunity to obtain any additional information the Company
possesses or could acquire without unreasonable effort or expense
necessary to verify the accuracy of the information furnished.
d. Purchaser has such knowledge and expertise in financial and business
matters that it is capable of evaluating the merits and substantial
risks of an investment in the Shares and is able to bear the economic
risks relevant to the purchase of the Shares hereunder.
e. Purchaser is relying solely upon independent consultation with its
professional, legal, tax, accounting and such other advisors as
Purchaser deems to be appropriate in purchasing the Shares; Purchaser
has been advised to, and has consulted with, its professional tax and
legal advisors with respect to any tax consequences if investing in
the Company.
<PAGE>
f. Purchaser recognizes that an investment in the securities of the
Company involves a substantial risk and understands the risk factors
related to the purchase of the Shares.
g. Purchaser understands that there may be no market for the Shares.
h. Purchaser's financial condition is such that Purchaser is under no
present or contemplated future need to dispose of any portion of
Shares to satisfy any existing or contemplated undertaking, need or
indebtedness.
i. Without in any way limiting the representation set forth above,
Purchaser further agrees not to make any disposition of all or any
portion of the Shares unless and until:
(1) There is then in effect a registration statement under the Act
covering such proposed disposition and such disposition is made
in accordance with such registration statement; or
(2) Purchaser shall have notified the Company of the proposed
disposition and shall have furnished the Company with a detailed
statement of the circumstances surrounding the proposed
disposition, and if requested by the Company, Purchaser shall
have furnished the Company with an opinion of counsel,
reasonably satisfactory to the Company and its counsel, that
such disposition will not require registration under the Act.
j. Purchaser understands that the certificate(s) evidencing the Shares
will bear substantially the following legend:
"The securities evidenced hereby have not been registered under
the Securities Act of 1933, as amended (the"Act"), nor
qualified under the securities laws of any states, and have
been issued in reliance upon exemptions from such registration
and qualification for non-public offerings. Accordingly, the
sale, transfer, pledge, hypothecation, or other disposition of
any such securities or any interest therein may not be
accomplished except pursuant to an effective registration
statement under the Act and qualification under applicable
State securities laws, and/or pursuant to an opinion of
counsel, satisfactory in form and substance to the Company, to
the effect that such registration and qualification are not
required."
k. The Purchaser confers full authority upon the Company (i) to instruct
its transfer agent not to transfer any of the Shares until it has
received written approval from the Company and (ii) to affix the
legend in Section 3(j) above to the certificate(s) representing the
Shares.
l. Purchaser understands that the Company is relying upon Purchaser's
representations and warranties as contained in this Agreement in
consummating the sale and transfer of the Shares without registering
them under the Act or any law. Therefore, Purchaser agrees to
indemnify the Company against, and hold it harmless from, all losses,
liabilities, costs, penalties and expenses (including attorney's
fees) which arise as a result of a sale, exchange or other transfer
of the Shares other than as permitted under this Agreement. Purchaser
further understands that the Company will make an appropriate
notation on its transfer records of the restrictions applicable to
these Shares.
4. Representations and Warranties of the Company. The Company represents and
warrants that:
a. The Company is a corporation duly organized, validly existing under
the laws of the State of Nevada.
b. The Company has all necessary corporate power and authority under the
laws of the State of Nevada and all other applicable provisions of
law to own its properties and other assets it now owns, to carry on
its business as is now conducted, and to execute and deliver and
carry out the provisions of this Agreement.
<PAGE>
c. All corporate action on the part of the Company required for the
lawful execution and delivery of this Agreement and the issuance,
execution and delivery of the Shares has been duly and effectively
taken. Upon execution and delivery, this Agreement will constitute a
valid and binding obligation of the Company, enforceable in
accordance with its terms, except as the enforceability may be
limited by applicable bankruptcy, insolvency or similar laws and
judicial decisions affecting creditors' rights generally.
5. Survival of Representations, Warranties and Covenants. The
representations, warranties and covenants made by the Company and
Purchaser in this Agreement shall survive the purchase and sale of the
Shares.
6. Miscellaneous.
a. In the event any one or more of the provisions contained in this
Agreement are for any reason held to be invalid, illegal or
unenforceable in any respect, such invalidity, illegality or
unenforceability shall not effect any other provisions of this
Agreement. This Agreement shall be construed as if such invalid,
illegal or unenforceable provision had never been contained herein.
b. This Agreement shall be binding upon and insure to the benefit of the
parties and their respective heirs, legal representatives,
successors, and permitted assigns. The parties hereto may not
transfer or assign any part of their rights or obligations except to
the extent expressly permitted by this Agreement.
c. This Agreement constitutes the entire agreement and understanding
between the parties with respect to the sale of the Shares and may
not be modified or amended except in writing signed by both parties.
d. No term or condition of this Agreement shall be deemed to have been
waived nor shall there be any estoppel to enforce any provision of
this Agreement except by written instrument of the party charged with
such waiver or estoppel.
IN WITNESS WHEREOF, the parties have executed this Stock Purchase
Agreement as of the day and year first appearing herein.
OMAP Holdings Incorporated ("Company") BRIA Communications Corp. ("Purchaser")
/s/ James Tilton /s/ Richard Lifschutz
James Tilton, President Richard Lifschutz, President
<PAGE>
10 (i)(q)
<PAGE>
STOCK PURCHASE AGREEMENT
THIS STOCK PURCHASE AGREEMENT ("Agreement") is made effective as of the
30th day of January, 1996, by an between OMAP Holdings Incorporated, a Nevada
corporation (the"Company") , and BRIA Communications Corp., a New Jersey
corporation (the "Purchaser").
Recitals
The Company desires to sell and transfer, and Purchaser desires to
purchase and acquire, Six Thousand One Hundred Fifty Four (6,154) shares of the
Company's common stock, par value $0.0001 per share (the "Shares"), to Purchaser
in a private non-registered and non-exempt transaction at the purchase price of
$20,000, or $3.25 per share, on the terms and conditions set forth below.
Agreement
1. Sale of Shares. The Company agrees to issue the Shares to Purchaser, and
Purchaser agrees to purchase the Shares from the Company. Immediately
after the Company receives a duly executed copy of this Agreement and
payment of the purchase price as set forth in Section 2 herein, it will
cause its agent to deliver a certificate for the Shares to Purchaser.
2. Purchase Price. The purchase price for the Shares is $3.25 per share for a
total price of $20,000, cash (the "Purchase Price").
3. Representation and Warranties of Purchaser. Purchaser represents and
warrants that:
a. Purchaser is an entity incorporated in the United States of America.
b. Purchaser is acquiring the Shares for its own account and not with a
view to any distribution within the meaning of the Securities Act of
1933, as amended (the "Act"). Purchaser acknowledges that it has been
advised and is aware that the Shares have not been registered under
the Act and are being issued as "restricted stock" within the meaning
of Rule 144 promulgated by the United States Securities and Exchange
Commission ("SEC") pursuant to the Act ("Rule 144"). Unless, and
until, the Shares are registered under the Act, they will be subject
to limitations upon resale set forth in Rule 144 or in other
administrative interpretations by the SEC in effect at the time of
the proposed sale or other disposition.
c. Purchaser has received all of the information it considers necessary
or appropriate for determining whether to purchase the Shares.
Purchaser is familiar with the business, affairs, risks and
properties of the Company. Purchaser has had an opportunity to ask
questions regarding the Company and the terms and conditions of the
offering of the Shares and receive such answers from the Company, its
officers, directors and other representatives. Purchaser has had the
opportunity to obtain any additional information the Company
possesses or could acquire without unreasonable effort or expense
necessary to verify the accuracy of the information furnished.
d. Purchaser has such knowledge and expertise in financial and business
matters that it is capable of evaluating the merits and substantial
risks of an investment in the Shares and is able to bear the economic
risks relevant to the purchase of the Shares hereunder.
e. Purchaser is relying solely upon independent consultation with its
professional, legal, tax, accounting and such other advisors as
Purchaser deems to be appropriate in purchasing the Shares; Purchaser
has been advised to, and has consulted with, its professional tax and
legal advisors with respect to any tax consequences if investing in
the Company.
<PAGE>
f. Purchaser recognizes that an investment in the securities of the
Company involves a substantial risk and understands the risk factors
related to the purchase of the Shares.
g. Purchaser understands that there may be no market for the Shares.
h. Purchaser's financial condition is such that Purchaser is under no
present or contemplated future need to dispose of any portion of
Shares to satisfy any existing or contemplated undertaking, need or
indebtedness.
i. Without in any way limiting the representation set forth above,
Purchaser further agrees not to make any disposition of all or any
portion of the Shares unless and until:
(1) There is then in effect a registration statement under the Act
covering such proposed disposition and such disposition is made
in accordance with such registration statement; or
(2) Purchaser shall have notified the Company of the proposed
disposition and shall have furnished the Company with a detailed
statement of the circumstances surrounding the proposed
disposition, and if requested by the Company, Purchaser shall
have furnished the Company with an opinion of counsel,
reasonably satisfactory to the Company and its counsel, that
such disposition will not require registration under the Act.
j. Purchaser understands that the certificate(s) evidencing the Shares
will bear substantially the following legend:
"The securities evidenced hereby have not been registered under
the Securities Act of 1933, as amended (the"Act"), nor qualified
under the securities laws of any states, and have been issued in
reliance upon exemptions from such registration and
qualification for non-public offerings. Accordingly, the sale,
transfer, pledge, hypothecation, or other disposition of any
such securities or any interest therein may not be accomplished
except pursuant to an effective registration statement under the
Act and qualification under applicable State securities laws,
and/or pursuant to an opinion of counsel, satisfactory in form
and substance to the Company, to the effect that such
registration and qualification are not required."
k. The Purchaser confers full authority upon the Company (i) to instruct
its transfer agent not to transfer any of the Shares until it has
received written approval from the Company and (ii) to affix the
legend in Section 3(j) above to the certificate(s) representing the
Shares.
l. Purchaser understands that the Company is relying upon Purchaser's
representations and warranties as contained in this Agreement in
consummating the sale and transfer of the Shares without registering
them under the Act or any law. Therefore, Purchaser agrees to
indemnify the Company against, and hold it harmless from, all losses,
liabilities, costs, penalties and expenses (including attorney's
fees) which arise as a result of a sale, exchange or other transfer
of the Shares other than as permitted under this Agreement. Purchaser
further understands that the Company will make an appropriate
notation on its transfer records of the restrictions applicable to
these Shares.
4. Representations and Warranties of the Company. The Company represents and
warrants that:
a. The Company is a corporation duly organized, validly existing under
the laws of the State of Nevada.
b. The Company has all necessary corporate power and authority under the
laws of the State of Nevada and all other applicable provisions of
law to own its properties and other assets it now owns, to carry on
its business as is now conducted, and to execute and deliver and
carry out the provisions of this Agreement.
<PAGE>
c. All corporate action on the part of the Company required for the
lawful execution and delivery of this Agreement and the issuance,
execution and delivery of the Shares has been duly and effectively
taken. Upon execution and delivery, this Agreement will constitute a
valid and binding obligation of the Company, enforceable in
accordance with its terms, except as the enforceability may be
limited by applicable bankruptcy, insolvency or similar laws and
judicial decisions affecting creditors' rights generally.
5. Survival of Representations, Warranties and Covenants. The
representations, warranties and covenants made by the Company and
Purchaser in this Agreement shall survive the purchase and sale of the
Shares.
6. Miscellaneous.
a. In the event any one or more of the provisions contained in this
Agreement are for any reason held to be invalid, illegal or
unenforceable in any respect, such invalidity, illegality or
unenforceability shall not effect any other provisions of this
Agreement. This Agreement shall be construed as if such invalid,
illegal or unenforceable provision had never been contained herein.
b. This Agreement shall be binding upon and insure to the benefit of the
parties and their respective heirs, legal representatives,
successors, and permitted assigns. The parties hereto may not
transfer or assign any part of their rights or obligations except to
the extent expressly permitted by this Agreement.
c. This Agreement constitutes the entire agreement and understanding
between the parties with respect to the sale of the Shares and may
not be modified or amended except in writing signed by both parties.
d. No term or condition of this Agreement shall be deemed to have been
waived nor shall there be any estoppel to enforce any provision of
this Agreement except by written instrument of the party charged with
such waiver or estoppel.
IN WITNESS WHEREOF, the parties have executed this Stock Purchase
Agreement as of the day and year first appearing herein.
OMAP Holdings Incorporated ("Company") BRIA Communications Corp. ("Purchaser")
/s/ James Tilton /s/ Richard Lifschutz
James Tilton, President Richard Lifschutz, Presiden
<PAGE>
10 (i)(r)
<PAGE>
STOCK PURCHASE AGREEMENT
THIS STOCK PURCHASE AGREEMENT ("Agreement") is made effective as of the
9th day of February, 1996, by an between OMAP Holdings Incorporated, a Nevada
corporation (the"Company") , and BRIA Communications Corp., a New Jersey
corporation (the "Purchaser").
Recitals
The Company desires to sell and transfer, and Purchaser desires to
purchase and acquire, Eight Thousand Five Hundred Seventy Two (8,572) shares of
the Company's common stock, par value $0.0001 per share (the "Shares"), to
Purchaser in a private non-registered and non-exempt transaction at the purchase
price of $30,000, or $3.50 per share, on the terms and conditions set forth
below.
Agreement
1. Sale of Shares. The Company agrees to issue the Shares to Purchaser, and
Purchaser agrees to purchase the Shares from the Company. Immediately
after the Company receives a duly executed copy of this Agreement and
payment of the purchase price as set forth in Section 2 herein, it will
cause its agent to deliver a certificate for the Shares to Purchaser.
2. Purchase Price. The purchase price for the Shares is $3.50 per share for a
total price of $30,000, cash (the "Purchase Price").
3. Representation and Warranties of Purchaser. Purchaser represents and
warrants that:
a. Purchaser is an entity incorporated in the United States of America.
b. Purchaser is acquiring the Shares for its own account and not with a
view to any distribution within the meaning of the Securities Act of
1933, as amended (the "Act"). Purchaser acknowledges that it has been
advised and is aware that the Shares have not been registered under
the Act and are being issued as "restricted stock" within the meaning
of Rule 144 promulgated by the United States Securities and Exchange
Commission ("SEC") pursuant to the Act ("Rule 144"). Unless, and
until, the Shares are registered under the Act, they will be subject
to limitations upon resale set forth in Rule 144 or in other
administrative interpretations by the SEC in effect at the time of
the proposed sale or other disposition.
c. Purchaser has received all of the information it considers necessary
or appropriate for determining whether to purchase the Shares.
Purchaser is familiar with the business, affairs, risks and
properties of the Company. Purchaser has had an opportunity to ask
questions regarding the Company and the terms and conditions of the
offering of the Shares and receive such answers from the Company, its
officers, directors and other representatives. Purchaser has had the
opportunity to obtain any additional information the Company
possesses or could acquire without unreasonable effort or expense
necessary to verify the accuracy of the information furnished.
d. Purchaser has such knowledge and expertise in financial and business
matters that it is capable of evaluating the merits and substantial
risks of an investment in the Shares and is able to bear the economic
risks relevant to the purchase of the Shares hereunder.
e. Purchaser is relying solely upon independent consultation with its
professional, legal, tax, accounting and such other advisors as
Purchaser deems to be appropriate in purchasing the Shares; Purchaser
has been advised to, and has consulted with, its professional tax and
legal advisors with respect to any tax consequences if investing in
the Company.
<PAGE>
f. Purchaser recognizes that an investment in the securities of the
Company involves a substantial risk and understands the risk factors
related to the purchase of the Shares.
g. Purchaser understands that there may be no market for the Shares.
h. Purchaser's financial condition is such that Purchaser is under no
present or contemplated future need to dispose of any portion of
Shares to satisfy any existing or contemplated undertaking, need or
indebtedness.
i. Without in any way limiting the representation set forth above,
Purchaser further agrees not to make any disposition of all or any
portion of the Shares unless and until:
(1) There is then in effect a registration statement under the Act
covering such proposed disposition and such disposition is made
in accordance with such registration statement; or
(2) Purchaser shall have notified the Company of the proposed
disposition and shall have furnished the Company with a detailed
statement of the circumstances surrounding the proposed
disposition, and if requested by the Company, Purchaser shall
have furnished the Company with an opinion of counsel,
reasonably satisfactory to the Company and its counsel, that
such disposition will not require registration under the Act.
j. Purchaser understands that the certificate(s) evidencing the Shares
will bear substantially the following legend:
"The securities evidenced hereby have not been registered under
the Securities Act of 1933, as amended (the"Act"), nor qualified
under the securities laws of any states, and have been issued in
reliance upon exemptions from such registration and
qualification for non-public offerings. Accordingly, the sale,
transfer, pledge, hypothecation, or other disposition of any
such securities or any interest therein may not be accomplished
except pursuant to an effective registration statement under the
Act and qualification under applicable State securities laws,
and/or pursuant to an opinion of counsel, satisfactory in form
and substance to the Company, to the effect that such
registration and qualification are not required."
k. The Purchaser confers full authority upon the Company (i) to instruct
its transfer agent not to transfer any of the Shares until it has
received written approval from the Company and (ii) to affix the
legend in Section 3(j) above to the certificate(s) representing the
Shares.
l. Purchaser understands that the Company is relying upon Purchaser's
representations and warranties as contained in this Agreement in
consummating the sale and transfer of the Shares without registering
them under the Act or any law. Therefore, Purchaser agrees to
indemnify the Company against, and hold it harmless from, all losses,
liabilities, costs, penalties and expenses (including attorney's
fees) which arise as a result of a sale, exchange or other transfer
of the Shares other than as permitted under this Agreement. Purchaser
further understands that the Company will make an appropriate
notation on its transfer records of the restrictions applicable to
these Shares.
4. Representations and Warranties of the Company. The Company represents and
warrants that:
a. The Company is a corporation duly organized, validly existing under
the laws of the State of Nevada.
b. The Company has all necessary corporate power and authority under the
laws of the State of Nevada and all other applicable provisions of
law to own its properties and other assets it now owns, to carry on
its business as is now conducted, and to execute and deliver and
carry out the provisions of this Agreement.
<PAGE>
c. All corporate action on the part of the Company required for the
lawful execution and delivery of this Agreement and the issuance,
execution and delivery of the Shares has been duly and effectively
taken. Upon execution and delivery, this Agreement will constitute a
valid and binding obligation of the Company, enforceable in
accordance with its terms, except as the enforceability may be
limited by applicable bankruptcy, insolvency or similar laws and
judicial decisions affecting creditors' rights generally.
5. Survival of Representations, Warranties and Covenants. The
representations, warranties and covenants made by the Company and
Purchaser in this Agreement shall survive the purchase and sale of the
Shares.
6. Miscellaneous.
a. In the event any one or more of the provisions contained in this
Agreement are for any reason held to be invalid, illegal or
unenforceable in any respect, such invalidity, illegality or
unenforceability shall not effect any other provisions of this
Agreement. This Agreement shall be construed as if such invalid,
illegal or unenforceable provision had never been contained herein.
b. This Agreement shall be binding upon and insure to the benefit of the
parties and their respective heirs, legal representatives,
successors, and permitted assigns. The parties hereto may not
transfer or assign any part of their rights or obligations except to
the extent expressly permitted by this Agreement.
c. This Agreement constitutes the entire agreement and understanding
between the parties with respect to the sale of the Shares and may
not be modified or amended except in writing signed by both parties.
d. No term or condition of this Agreement shall be deemed to have been
waived nor shall there be any estoppel to enforce any provision of
this Agreement except by written instrument of the party charged with
such waiver or estoppel.
IN WITNESS WHEREOF, the parties have executed this Stock Purchase
Agreement as of the day and year first appearing herein.
OMAP Holdings Incorporated ("Company") BRIA Communications Corp. ("Purchaser")
/s/ James Tilton /s/ Richard Lifschutz
James Tilton, President Richard Lifschutz, President
<PAGE>
10 (i)(s)
<PAGE>
STOCK PURCHASE AGREEMENT
THIS STOCK PURCHASE AGREEMENT ("Agreement") is made effective as od the
28th day of September 1995, by and between BRIA Communications Corp., a New
Jersey corporation (the"Company"), and Tinarong Building Material Holdings,
Ltd., a Utah corporation (the "Purchaser").
Recitals
The Company desires to sell and transfer, and Purchaser desires to
purchase and acquire, Fourty Thousasn (40,000) shares of Company's common stock,
par value $0.001 per share (the "Shares"), to Purchaser in a private
non-registered and nonexempt transaction at the purchase price of $0.25 per
share on the terms and conditions set forth below.
Agreement
1. Sale of Shares. The Company agrees to issue the Shares to Purchaser,
and Purchaser agrees to purchase the Shares from the Company.
Immediately after the Company receives a duly executed copy of this
Agreement and payment of the purchase price as set forth in Section 2
herein, it will cause its agent to deliver a ceritificate for the
Shares to Purchaser.
2. Purchase Price. The purchase price for the Shares is $0.25 per share
for a total price of $10,000 cash (the "Purchase Price").
3. Representations and Warranties of Purchaser. Purchaser represents and
warrants that:
a. Purchaser is an entity incorporated in the United
States of America.
b. Purchaser is acquireing the Shares for its own
account and not with a view to any distribution
within the meaning of the Securities Act of 1933, as
amended (the "Act"). Purchaser acknowledges that it
has been advised and is aware that the Shares have
not been registered under the Act and are being
issued as "restricted stock" within the meaning of
Rule 144 promulgated by the United States Securities
and Exchange Commission ("SEC") pursuant to the Act
("Rule 144"). Unless, and until, the Shares are
registered under the Act, they will be subject to
limitations upon resale set forth in Rule 144 or in
other administrative interpretations by the SEC in
effect at the time of the proposed sale or other
disposition.
c. Purchaser has received all of the information it
considers necessary or appropriate for determining
whether to purchase the Shares. Purchaser is familiar
with the business, affairs, risks and properties of
the Company. Purchaser has had an opportunity to ask
questions regarding the Company and the terms and
conditions of the offering of the Shares and receive
such answers from the Company, its officers,
directors and other representatives. Purchaser has
had the opportunity to obtain any additional
information the Company possesses or could acquire
without unreasonable effort or expense necessary to
verify the accuracy of the information furnished.
d. Purchaser has such knowledge and expertise in
financial business matters that it is capable of
evaluating the merits and substantial risks of an
investment in the Shares and is able to bear the
economic risks relevant to the purchase of the Shares
hereunder.
e. Purchaser is relying solely upon independent
consultation with its professional, legal, tax,
accounting and such other advisors as Purchaser deems
to be appropriate in purchasing the Shares; Purchaser
has been advised to, and has consulted with, its
professional tax an legal advisors with respect to
any tax consequences of investing in the Company.
<PAGE>
f. Purchaser recognizes that an investment in the
sercurities of the Company involves substantial risk
and understands the risk factors related to the
purchase of the Shares.
g. Purchaser understands that theremay be no market for
the Shares.
h. Purchaser's financial condition is such that
Purchaser is under no present or contemplated furute
need to dispose of any portion of Shares to satisfy
any existing or contemplated undertaking, need or
indebtedness.
i. Without in any way limiting the representation set
forth above, Purchaser further agrees not to make any
disposition of all or any portion of the Shares
unless and until:
(1) There is then in effect a registration
statement under the Act covering such
proposed disposition and such disposition is
made in accordance with such registration
statement; or
(2) Purchaser shall have notified the Company of
the proposed disposition and shall have
furnished the Company with a detailed
statement of the circumstances surrounding
the proposed disposition, and if requested
by the Company, Purhcaser shall have
furnished the Company with an opinion of
counsel, reasonably satisfactory to the
Company and its counsel, that such
disposition will not require registration
under the Act.
j. Purchaser understand that the certificate(s)
evidenceing the Shares will bear substantially the
following legend:
"The securities evidences hereby have not
been registered under the Securities Act of
1933, as amendend (the "Act"), nor qualified
under the securities laws of any states, and
have been issued in reliance upon exemptions
from such registration and qualification for
nonpublic offerings. Accordingly, the sale,
transdfer, pledge, hypothecation, or other
disposition of any such securities or any
interest therein may not be accomplished
except pursuant to an effective registration
statement under the Act and qualification
under applicable State securities laws,
and/or pursuant to an option of counsel ,
satisfactory in form and substance to the
Company, to the effect that such
registration and qualification are not
required."
k. The Purchaser confers full authority upon the Company
(i) to instruct its transfer agent not to transfer
any of the Shares until it has received written
approval from the Company and (ii) to affix the
legend in Section 3 (j) above to the to the
certificates(s) representing the Shares.
l. Purchaser understands that the Company is relying
upon Purchaser's representations and warranies as
contained in this Agreement in consummating the sale
and transfer of the Shares without registering them
under the Act or any law. Therefore, Purchaser agrees
to indemnify the Company against, and hold it
harmless from, all losses, liabilities, costs,
penalties and expenses (including attorney's fees)
which arise as a result of a sale, exchange or other
transfer of the Shares other than as permitted under
this Agreement. Purchaser further understands that
the Company will make a appropriate notation on its
transfer record of the restriction application to
these Shares.
4. Representations and Warranties of the Company. The Company represents
and warrants that:
a. The Company is a corporation duly organized, validly
existing under the laws of the State of New Jersey.
b. The Company has all necessary corporate power and
authority under the laws of the State of New Jersey
and all other applicable provisions of law to own its
properties and other assets it now owns, to carry on
its business as is now conducted, and to execute and
deliver and carry out the provisions of the
Agreement.
<PAGE>
c. All corporate action on the part of the Company
required for the lawful execution and delivery of
this Agreement and the issuance, execution and
delivery of the Shares has been duly and effectively
taken. upon execution and delivery, this Agreement
will constiture a valid and binding obligation of the
Company, enforceable in accordance with its terms,
except as the enforceability may be limited by
applicable bankruptcy, insolvency or similar laws and
judicial decisions affecting creditors' rights
generally.
5. Survival of Representations, Warranties and Covenants. The
representations, warranties and covenants made by the Company and
Purchaser in this Agreement shall survive the purchase and sale of the
Shares.
6. Miscellaneous.
a. In the event any one or more of the provisions
contained in this Agreement are for any reason held
to be invalid, illegal or unenforceable in any
respect, such invalidity, illegality or
unenforceability shall not effect any other
provisions of this Agreement. This Agreement shall be
construed as if such invalid, illegal or
unenforceable provision had never been contained
herein.
b. This Agreement shall be binding upon and insure to
the benefit of the parties and their respective hirs,
legal representatives, successors and permitted
assigns. The parties hereto may not transfer or
assign any part of their rights or obligations except
to the extent expressly permitted by this Agreement.
c. This Agreement constitutes the entire agreement and
understanding between the parties with respect to the
sale of the Shares, and may not be modified or
amended except in writing signed by both parties.
d. No term or condition of this Agreement shalll be
deemed to have been waived nor shall there be any
estoppel to enforce any provision of this Agreement
except by written instrument of the party charged
with such waiver or estoppel.
IN WITNESS WHEREOF, the parties have executed this Stock Purchase
Agreement as of the day and year first appearing herein.
Tianrong Building Material Holdings, Ltd. BRIA Communications Corp.
("Purchaser") ("Company")
/s/ Mathew A. Veal /s/ Richard Lifschutz
- -------------------------- -------------------------------
Matthew A. Veal, Vice-President Richard Lifschutz, President
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM CONSOLIDATED
UNAUDITED CONDENSED FINANCIAL STATEMENTS FILED WITH THE COMPANY'S DECEMBER 31,
1995 ANNUAL REPORT ON FORM 10-KSB AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE
BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000065231
<NAME> BRIA Communications Corp.
<MULTIPLIER> 1
<CURRENCY> U. S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-01-1995
<PERIOD-END> DEC-31-1995
<EXCHANGE-RATE> 1
<CASH> 82,398
<SECURITIES> 344,445
<RECEIVABLES> 231
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 82,637
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 600,548
<CURRENT-LIABILITIES> 956,173
<BONDS> 0
0
0
<COMMON> 6,798
<OTHER-SE> (362,423)
<TOTAL-LIABILITY-AND-EQUITY> 600,548
<SALES> 0
<TOTAL-REVENUES> 128
<CGS> 0
<TOTAL-COSTS> 927,761
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 4,155
<INCOME-PRETAX> 931,788
<INCOME-TAX> 0
<INCOME-CONTINUING> (931,788)
<DISCONTINUED> 0
<EXTRAORDINARY> 90,594
<CHANGES> 0
<NET-INCOME> (841,194)
<EPS-PRIMARY> (0.19)
<EPS-DILUTED> (0.19)
</TABLE>
