SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities and Exchange Act of 1934
Date of Report (date of earliest event reported) May 23, 1996
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LASER MASTER INTERNATIONAL, INC.
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(Exact name of Registrant as specified in its Charter)
New York
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(State or other jurisdiction of incorporation)
2-76262-NY 11-2564587
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Commission File No. I.R.S. Employer Identification Number
1000 First Street, Harrison, NJ 07029
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Address of principal executive offices Zip Code
(201) 482-7200
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Registrant's telephone number, including area code
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ITEM 5. OTHER EVENTS
The Registrant ("Company"), on May 23, 1996, completed the sale of
4,000,000 shares of its Common Stock, $.01 par value, at $1.00 per share.
3,180,000 shares at $1.00 per share, were sold pursuant to the Regulation "D"
and Section 4.2 exemptions of the Securities Act, and the balance of 820,000
shares of the Common Stock at $1.00 per share were sold pursuant to Regulation
"S" of the Securities Act to Offshore Subscribers, who represented that they
qualified under Regulation "S". A form copy of the Offshore Agreement is
annexed hereto and marked Exhibit 1. The Company paid the sum of $103,000 for
fees and expenses, in addition to 41,225 shares of restricted stock, $.01 par
value to Tontine Holdings Corp. for its services in connection with the
Regulation "S" transactions. Additionally, the Company further paid the sum of
$20,000 to Cornerstone Financial Corp. with respect to fees for the Regulation
"S" transactions.
The Company incorporates by reference the information filed under
Regulation "D" of the Securities Act.
On May 7, 1996, the Company obtained shareholder ratification with
respect to the employment agreements for Abraham Klein, Dov Klein and Hershel
Klein. The employment agreements contain provisions wherein over a five (5)-
year period each of the aforementioned individuals will receive annually
$50,000 in employment compensation and stock options to purchase 115,000 shares
of Common Stock in the Company, or, 575,000 shares each at $1.00 per share over
a period of five years as a part of their employment agreement with the
Company. The aggregate number of stock options for Messrs. Abraham, Dov and
Hershel Klein is 1,725,000 options to purchase 1,725,000 shares of Common Stock
in the Company.
Additionally, the employment agreements are renewable for a second
five-year term. Upon renewal, the Company has the option to increase the
annual employment compensation paid to Messrs. Abraham Klein, Dov Klein and
Hershel Klein to the sum of $150,000 per annum or, in the alternative, grant
each year, 115,000 options to purchase 115,000 shares of common stock in the
Company at $1.00 per share for an aggregate of 575,000 for each employee over
five years, for a total of an additional 1,725,000 shares of common stock.
Additionally, stockholders further approved the granting of 1,200,000
stock options to purchase 1,200,000 shares of the Company's common stock at
$1.00 per share to Mr. Mendel Klein, President and Chairman of the Company.
The stock options vest at the rate of 240,000 per annum over a five-year period
commencing in Fiscal Year 1996 and up until the Fiscal Year 2001. Mr. Klein
did not participate in the stockholder vote at the meeting which ratified the
grant of the options to Mr. Klein. The term of all stock options granted are
for a period of five years from May 8, 1996 to May 9, 2001, and were granted
pursuant to a Qualified Stock Option Plan for Employees and a Non-Qualified
Stock Option Plan for Officers, Directors and Consultants.
Additionally, shareholders approved the granting of 50,000 options to
purchase 50,000 shares at $1.00 per share for a
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period of five years to Stephen Strauss, and 125,000 options to purchase
125,000 shares at $1.00 per share to the law firm of Baratta & Goldstein.
The Company entered into an employment contract with Anthony J. Cataldo
to serve as an officer of the Company. Mr. Cataldo received $150,000 per
annum, and was granted 131,000 shares of restricted common stock of the Company
in addition to 100,000 options to purchase 100,000 shares of common stock at
$1.00 per share for a one-year period and an additional 100,000 options to
purchase 100,000 shares of common stock of the Company at $2.00 per share for a
two-year period, expiring on March 27, 1998. Annexed hereto and made a part
hereof is a form copy of the employment contract entered into with Dov Klein,
Hershel Klein and Abraham Klein, marked Exhibit 2. Annexed hereto and made a
part hereof is a form of the employment contract entered into with Anthony J.
Cataldo, marked Exhibit 3, and the form of stock option awarded to Mendel Klein
marked Exhibit 4.
EXHIBITS
1. Copy of form of Offshore Agreement;
2. Copy of form of Employment Agreement by and between Laser Master
International, Inc. and Dov Klein, Abraham Klein and Hershel Klein.
3. Copy of form of Employment Agreement by and between Laser Master
International, Inc. and Anthony J. Cataldo.
4. Copy of Stock Option Agreement awarded to Mendel Klein.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf of the
undersigned hereunto duly authorized.
Dated: Harrison, New Jersey
May 31, 1996
LASER MASTER INTERNATIONAL, INC.
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(Registrant)
/s/ MENDEL KLEIN
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MENDEL KLEIN, President
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EXHIBIT INDEX
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EXHIBIT NO. DESCRIPTION
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1. Copy of form of Offshore Agreement;
2. Copy of form of Employment Agreement by and between Laser Master
International, Inc. and Dov Klein, Abraham Klein and Hershel Klein.
3. Copy of form of Employment Agreement by and between Laser Master
International, Inc. and Anthony J. Cataldo.
4. Copy of Stock Option Agreement awarded to Mendel Klein.
Exhibit 1 - Form of
Offshore Agreement
OFFSHORE SECURITIES SUBSCRIPTION AGREEMENT
THIS OFFSHORE SECURITIES AGREEMENT is executed in reliance upon the transaction
exemption afforded by Regulation S ("Regulation S") as promulgated by the
Securities and Exchange Commission ("SEC"), under the Securities Act of 1933, as
amended ("1933 Act" or the "Act").
THIS AGREEMENT has been executed by the undersigned in connection with the
private placement of shares of Common Stock (hereinafter referred to as the
"Shares") of Laser Master International, Inc. located at 1000 First Street,
Harrison, NJ 07029, United States of America (hereinafter referred to as "Laser
Master", the "Company" or the "Seller"). The undersigned
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a corporation organized under the laws of
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jurisdiction or an individual citizen of (hereinafter
referred to as "Buyer") or "Purchaser"), hereby represents and warrants to, and
agrees with Seller as follows:
1. AGREEMENT TO SUBSCRIBE; PURCHASE PRICE
(a) The undersigned hereby subscribes for shares of common stock, at
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$1.00 per share and tenders as consideration therefore, a certified check or
wired proceeds of gross amount of US $ payable in US Dollars.
(b) Form of Payment. Buyer shall pay the purchase price by delivering good
funds in United States Dollars to the designated depository for closing by
delivery of securities versus payment.
2. SUBSCRIBER REPRESENTATION;
ACCESS TO INFORMATION;
INDEPENDENT INVESTIGATION
(a) Offshore transaction. The Buyer represents and warrants to the Seller as
follows:
(i) The Buyer is not a U.S. person as the term is defined under
Regulation S as promulgated by the SEC under the authority of the
1933 Act, and as set forth on Schedule A attached hereto;
furthermore the Buyer is not organized under the laws of the
United States and was not formed for the purpose of investing in
Regulation S securities and is not registered under the
Securities Act;
(ii) At the time the buy order was originated, the Buyer was
outside the United States;
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(iii) No offer to purchase the Shares was made in the United
States;
(iv) The Buyer is purchasing the Shares for its own account and
not on behalf of any U.S. person and for investment purposes and
not with the view towards distribution; the sale has not been
prearranged with the purchaser in the United States;
(v) All subsequent offers and sales of the Shares shall be made
in compliance with Regulation S pursuant to registration of
securities under the Securities Act of 1933 or pursuant to an
exemption form registration. In any case, the Shares shall not
be resold to U.S. persons or within the United States during the
prohibited period of forty days commencing on the date of closing
of the purchase of the Shares or upon the date of the last
closing of Shares sold by or through a distribution if the Shares
are part of a distribution by a distributor, as that term is
defined in Regulation S;
(vi) The Buyer understands that the Shares are being offered and
sold to it in reliance on specific exemptions from the
registration requirements of Federal and State securities laws
and that the Seller is relying upon the truth and accuracy of the
representations, warranties, agreements, acknowledgements and
understandings of Buyer set forth herein in order to determine
the applicability of such exemptions and the suitability of Buyer
to acquire the Shares.
(vii) All offers and sales of the Shares prior to the expiration
of a period commencing on the date of the transaction and ending
forty (40) days thereafter (the "Restricted Period") shall be
made in compliance with Rule 903 or Rule 904, pursuant to
registration of securities under the 1933 Act or pursuant to an
exemption and each distributor, if any, participating in the
offering the Shares has agreed in writing to that effect;
(viii) In the event of resale of the Shares during the
Restricted Period, the Buyer shall provide a written confirmation
or other written notice to any distributor, dealer or person
receiving a selling concession, fee or other remuneration in
respect of the Shares stating that the purchaser is subject to
the same restrictions on offers and sales that apply to a
distributor, and shall obtain the
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agreement of any such purchaser to provide such written
confirmation or other notice upon resale with the restricted
period;
(ix) All offering documents received by the Buyer shall include
statements to the effect that the Shares have not been registered
under the 1933 Act and may not be offered or sold in the United
States or to U.S. persons during or after the Restricted Period,
unless the Shares are registered under the 1933 Act or an
exemption from the registration requirements or the 1933 Act is
available.
(b) Independent Investigations Access. The Buyer, in making the decision to
purchase the Shares subscribed, has relied upon independent investigations made
by it and its representatives, if any, and the Buyer and such representatives,
if any, have prior to any sale to it, been given access and the opportunity to
examine all material books and records of the Company, all material contracts
and documents relating to this offering and an opportunity to ask questions of,
and to receive answers from the Company or any person acting on its behalf
concerning the terms and conditions of this offering. The Buyer and its
advisors, if any, have received complete and satisfactory answers to any such
inquiries. The Buyer and its advisors, if any, have been furnished with all
materials relating to the business, finances and operation of the Company and
materials relating to the offer and sale of the Shares which have been
requested.
(c) No Government Recommendation or Approval. The Buyer understands that no
Federal or State agency has passed on or made any recommendation or endorsement
of the Shares.
3. SELLER REPRESENTATIONS
(a) Reporting Company Status. The Seller is a "Reporting Company" as defined
by Rule 902 of Regulation S. Seller is in full compliance, to the extent
applicable, with all reporting obligations under either Section 12(b), 12(g) or
15(d) of the Securities Exchange Act of 1934, as amended (the "Exchange Act").
Seller has registered its Common Stock pursuant to Section 12 of the Exchange
Act and the Common Stock trades on the National Association of Securities
Dealers Bulletin Board Quotation System (NASDAQ) under the symbol "LMII".
(b) Current Public Information. The Seller has furnished the Buyer with copies
of the Company's most recent Annual Report on the Form 10-K filed with the
Securities and Exchange Commission and the Forms 10-Q and 8K filed thereafter
(collectively the "SEC Filings"), and other publicly available documents.
(c) Offshore Transaction. The Seller represents and warrants as follows:
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(i) The Seller has not offered the Securities which are the subject
of this transaction to any person in the United States, any
identifiable groups of U.S. citizens abroad, or to any U.S. person as
the term is defined in Regulation S.
(ii) At the time the buy order was originated, the Seller and/or its
agents reasonably believed the Buyer was outside of the United States
and was not a U.S. person.
(iii) The Seller and/or its agents reasonably believe that the
transaction has not been pre-arranged with a buyer in the United
States.
(d) No Direct Selling Efforts. In regard to this transaction the Seller has
not conducted any "directed selling efforts" as the term is defined in Rule 902
of Regulation S nor has the Seller conducted any general solicitation relating
to the offer and sale of the securities which are the subject of this
transaction to persons resident with the United States or elsewhere.
(e) Concerning the Shares. The Shares when issued and delivered will be duly
and validly authorized and issued, fully paid and non assessable and will not
subject to the holders thereof
to personal liability by reason of being such holders. There are no preemptive
right of any shareholder of the Company.
(f) Subscription Agreement. The Subscription Agreement has been duly
authorized, validly executed and delivered on behalf of the Seller and is a
valid and binding agreement in accordance with its terms, subject to general
principles of equity and to bankruptcy or other laws affecting the enforcement
of creditors' rights generally.
(g) Non-contravention. The execution and delivery of the Subscription
Agreement and the consummation of the issuance of the Shares and the
transactions contemplated by the Subscription Agreement do not and will not
conflict with or result in a breach by the Seller of any of the terms of
provisions of, or constitute a default under, the articles of incorporation or
by-laws of the Seller, or any indenture, mortgage, deed of trust of other
material agreement or instrument to which the Seller is a party or by which it
or any of its properties or assets are bound or any existing applicable law,
rule or regulation or any applicable decree,judgment or order of any court,
Federal or State regulatory body, administrative agency or other governmental
body having jurisdiction over the Seller or any of its properties or assets.
(h) Approvals. The Seller is not aware of any authorization,
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approval or consent of any governmental body which is legally required for the
issuance and sale of the Shares as contemplated by the Subscription Agreement.
4. ADDITIONAL REPRESENTATIONS
The Buyer represents and warrants to the Company and agrees that:
(i) The Buyer is purchasing the Shares for investment and not with a
view to, or in connection with, any distribution, resale, subdivision
or fractionalization of the Shares for an indefinite period of time,
except to non-US persons who qualify under Regulation S.
(ii) The Buyer understands the restrictions on transfer of the Shares
imposed by this Agreement, U.S. securities laws and regulations and
the laws and regulations of any other applicable country or
jurisdiction, including, without limitation, those set forth in
Paragraphs 5 and 6 hereof, which apply both during and after the
Restricted Period notwithstanding the absence of any legend pertaining
to such restrictions on the certificates representing the Shares.
(iii) The Buyer has not taken any action that would cause the Company to be
subject to any claim for commission or other fee or remuneration by any
broker, finder or other person and the Buyer hereby indemnifies the Company
against any such claim caused by the actions of the Buyer or any of its
employees or agents.
5. REGULATION S TRANSFER RESTRICTION
The transaction restriction in connection with this offshore offer and sale
restrict the Buyer from offering or selling to U.S. persons for a forty (40)-day
period. Rule 903 (c)(2)(iii) governs the forty (40) day transaction
restriction. The Buyer hereby agrees to comply with that restriction not
withstanding that the rules do not require the placement of such a restrictive
legend on the share certificate.
6. RESTRICTION ON RESALES IN THE UNITED STATES
Section 5 of the 1933 Act does not apply to sales of the Shares outside the
United States. Rule 904 provides a safe harbor for determining that a resale
has occurred outside the United Sates. Section 5 of the 1933 Act prohibits
resale of the Shares in the United Sates except pursuant to an effective
registration statement or an exemption from registration for which the Buyer
qualifies. The Buyer understands the requirements for qualifying for the
exemption form registration afforded by Section 4(l) of the 1933
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act and that there can be no assurance that the Buyer will be able to qualify
for exemption afforded by Section 4(l) of the 1933 Act. The Company shall have
no liability in the event the Buyer is unable to qualify for the exemption
afforded by Section 4(l) and is unable to offer, sell or otherwise transfer the
Shares in the United States.
7. EXEMPTION; RELIANCE ON REPRESENTATIONS
The Buyer understands that the offer and sale of the Shares are not being
registered under the 1933 Act. The Seller is relying on the rules governing
offers and sales made outside the United Sates pursuant to Regulation S. Rules
902 through 904 of Regulation S govern this transaction.
8. TRANSFER AGENT INSTRUCTIONS
The Seller's agent will be instructed to issue one or more share certificate
representing the Shares with a self-liquidating restrictive legend in the name
of the Buyer and in such denominations to be specified prior to Closing. The
self-liquidating legend shall be structured to liquidate on the date of the
forty first (41) day after the date of this Subscription Agreement. Seller
further warrants that no instructions, other than these instructions and
instructions for a "stop transfer" instruction until the end of the said forty
(40) day period, have been given to the transfer agent and that the Shares shall
otherwise be freely transferable on the books and records of the Company.
After the end of the said forty (40) day period, Seller and its counsel hereby
agree to instruct the Seller's transfer agent to remove any and all restrictive
legends on said certificates. Nothing in this section, however, shall affect in
any way the Buyer's obligations and agreement to comply with all applicable
securities laws upon resale of the Shares.
9. STOCK DELIVERY INSTRUCTIONS
The share certificates shall be delivered to the Buyer on a delivery versus
payment basis at such times and places to be mutually agreed.
10. CLOSING DATE
The date of the issuance of the sale of the Shares (the "Closing date") shall be
at such times to be mutually agreed.
11. CONDITIONS TO THE COMPANY'S OBLIGATION TO SELL
The Buyer understands that the Seller's obligation to sell the Stock is
conditioned upon:
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(a) The Receipt and acceptance by the Seller of this Subscription Agreement for
all of the Shares as evidenced by execution of this Subscription Agreement by
the President or any Vice President of the Seller; and
(b) Delivery into the closing depository by the Buyer of good funds as payment
in full for the purchase of the Shares.
12. CONDITIONS TO THE BUYER'S OBLIGATION TO PURCHASE
The Seller understands that the Buyer's obligation to purchase the Stock is
conditions upon:
(a) Acceptance of the Buyer of a satisfactory Subscription Agreement for the
sale of shares; and
(b) Delivery of the Shares of Common Stock without any restrictive legend as
described herein.
13. The undersigned acknowledges receipt of the Private Placement Memorandum
and all Exhibits dated January , 1996.
14. GOVERNING LAW
This Agreement shall be governed by an interpreted in accordance with the laws
of the State of New York. A facsimile transmission of this signed agreement
shall be legal and binding on all parties hereto.
IN WITNESS WHEREOF, this Offshore Securities Subscription Agreement was duly
executed on the date first written below.
DATED this day of the month of , 1996.
OFFICIAL SIGNATORY OF THE BUYER
By:
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ACCEPTED BY:
LASER MASTER INTERNATIONAL, INC.
By:
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Title:
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Dated:
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Dated:
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Exhibit 2 - Form of
Employment Agreement
AGREEMENT made this day of , , by and between LASER
MASTER INTERNATIONAL, INC., having its principal place of business at 1000 First
Street Harrison, NJ 07029 (hereinafter referred to as ("EMPLOYER") and
residing at (hereinafter referred to
as "EMPLOYEE").
W I T N E S S E T H:
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WHEREAS, the EMPLOYER is engaged in the business of providing
industrial and commercial printing and engraving services to customers; and
WHEREAS, the EMPLOYER is desirous of employing EMPLOYEE; and
WHEREAS, in the opinion of the Board of Directors of EMPLOYER, the
success of the business operations of the EMPLOYER is contingent upon the
performance of the EMPLOYEE, and in order to ensure and provide for the terms
and conditions of EMPLOYEE's employment.
NOW, THEREFORE, IN CONSIDERATION OF THE MUTUAL COVENANTS AND
PROMISES AND OTHER GOOD AND VALUABLE CONSIDERATION, THE
RECEIPT OF WHICH IS HEREBY ACKNOWLEDGED, IT IS MUTUALLY
AGREED AS FOLLOWS:
FIRST: All prior understandings and/or Agreements between the
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parties are hereby deemed superseded and incorporated into the provisions of
this Agreement.
SECOND: The EMPLOYER does hereby employ, engage and hire the
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EMPLOYEE as of EMPLOYER for a period of five
(5) years, commencing and terminating .
THIRD: EMPLOYEE agrees that he will, at all times, faithfully,
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industriously, and to the best of his ability, experience and talent, perform
all of the duties that may be required of and from him pursuant to the expressed
and implicit term hereof.
FOURTH: The EMPLOYER shall pay to the EMPLOYEE and the EMPLOYEE
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agrees to accept from the EMPLOYER in full payment for the EMPLOYEE's services
hereunder, compensation at the annual rate of $50,000 per year. EMPLOYEE will
be entitled to reimbursement of all expenses incurred on behalf of EMPLOYER, so
long as said expenses are approved by EMPLOYER, and that adequate receipts are
provided by EMPLOYEE.
EMPLOYER agrees that as a part of the employment
compensation herein that within 90 days of the close of each of EMPLOYER's
fiscal years that EMPLOYEE, as long as EMPLOYEE is in good standing and employed
by the Company, will be entitled to receive 115,000 options to purchase 115,000
shares of Common Stock in the Company at $1.00 per share (an aggregate of
575,000 stock options over five [5] years). The options vest at the end of each
calendar year.
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EMPLOYEE will have the option of renewing his
employment contract with the EMPLOYER upon notice to the EMPLOYER 180 days from
the termination of the within Employment Agreement. In the event of a renewal
of the within Agreement for an additional five (5) years, then in that event,
EMPLOYEE will have the option of compensation to be paid to EMPLOYEE with the
same terms and conditions as the original Employment Agreement ($50,000 per
annum and 115,000 options to purchase 115,000 shares of Common Stock at $1.00
per share), an aggregate of 575,000 stock options or, in the alternative, to be
paid the sum of $150,000 per annum by EMPLOYER without the grant of any
additional stock options.
EMPLOYEE understands and agrees that any bonus
compensation is at the discretion of the Board of Directors of EMPLOYER.
EMPLOYEE understands and agrees that the shares to be
issued will be legended shares and contain the following legend:
"The shares represented by this certificate have not been
registered under the Securities Act of 1933. The shares
have been acquired for investment and may not be sold,
transferred or assigned in the absence of an effective
registration statement for these shares under the Securities
Act of 1933 or an opinion of the Company's counsel that
registration is not required under said Act."
EMPLOYER agrees that it will afford to EMPLOYEE a cost-
free piggyback right of registration for any shares awarded to EMPLOYEE under
the within Agreement or, in the alternative, EMPLOYER shall have the option to
transfer any of the stock options granted herein to a qualified or non-qualified
stock option plan, if such a plan is adopted by EMPLOYER.
FIFTH: The EMPLOYEE shall devote all of his working time,
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attention, knowledge and skill solely and exclusively to the business and
interest of the EMPLOYER and the EMPLOYER shall be entitled to all benefits,
emoluments, profits or other issues arising from or incidental to any or all
work, services and advice of the EMPLOYER, and the EMPLOYEE expressly agrees
that he will not during the term hereof, be interested directly or indirectly,
in any form, fashion or manner, as a partner, officer, director, stockholder,
advisor, or employee in any other business similar to the business of the
EMPLOYER. Nothing herein contained shall, however, limit the rights of the
EMPLOYEE to own up to 5% of the capital stock or other securities of any
corporation whose stock or securities are publicly owned or regularly on a
public exchange or in the over-the-counter market, nor shall anything contained
be deemed to prevent the EMPLOYEE from investing or limiting the EMPLOYEE's
rights to invest in other business not allied with the business of the EMPLOYER,
so long as EMPLOYEE continues to devote all of his working time, attention,
knowledge and skill solely and
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exclusively to the business and interest in any way with the business of the
EMPLOYER.
SIXTH: During the course of EMPLOYEE's employment under the
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terms and conditions of this contract, and for eighteen (18) months thereafter,
the EMPLOYEE further specifically agrees that he will not, at any time, in any
fashion, form or manner, either directly or indirectly, divulge, disclose or
communicate to any person, firm or corporation, in any manner whatsoever, any
information of any kind, nature or description concerning any matters affecting
or relating to the business of the EMPLOYER, including, without limiting the
generality of the foregoing, any of its customers, its manner of operations, its
plans, processes, programs, or any date of any kind, nature or description
without regard to whether any or all of the foregoing matters shall be deemed
confidential, material or important, that parties hereto stipulating that as
between them the same are important, material, confidential and gravely affect
the effective and successful conduct of the business of the EMPLOYER and its
goodwill, and that any breach of the terms of this paragraph is a material
breach thereof, except where the EMPLOYEE shall be acting on behalf of the
EMPLOYER. EMPLOYEE understands and agrees that in the event that EMPLOYEE
violates the terms and conditions as stated in the within paragraph, that he
will be subject to an injunction and damages, and understands and agrees that
EMPLOYER's only immediate remedy to prevent further or continued damages will be
a petition for injunctive relief.
EMPLOYEE further understands and agrees that EMPLOYER
in entering into the within Agreement is relying upon EMPLOYEE's representation
and warranty that all trade secret and other proprietary information of EMPLOYER
will be kept strictly confidential by EMPLOYEE and not utilized by EMPLOYEE in
any manner whatsoever other than on EMPLOYER's behalf and during the course of
EMPLOYER's employment with EMPLOYER. In addition thereto, EMPLOYEE understands
and agrees that EMPLOYEE may be responsible in damages as determined by a Court
of competent jurisdiction, as a result of a violation of the within paragraph.
SEVENTH: It is expressly understood and agreed that the terms of
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this Agreement shall terminate prior to , upon the happening of the
following events:
(a) Automatically and without notice, upon the death
of the EMPLOYEE; it is also understood that EMPLOYEE's estate will be entitled
to six months' salary which will be payable to his estate;
(b) Persistent absenteeism on the part of the
EMPLOYEE, however, such absenteeism is not to include absenteeism as a result of
ill health;
(c) Deliberate and wilful failure to perform normal
services and duties required of EMPLOYEE pursuant hereto, except if the
performance of such duties or services would result in a breach of EMPLOYEE's
fiduciary responsibility;
(d) Conviction of a felony involving moral turpitude;
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(e) Total or partial disability of the EMPLOYEE for a
period of four (4) consecutive months, so that he is prevented from performing a
substantial part of his duties; it being further understood and agreed that any
proceeds received by EMPLOYER from a policy of disability benefits insurance or
any other proceeds received from any Federal, State or Municipal agency of
government will be a credit to the amount of compensation paid to EMPLOYEE by
EMPLOYER; and
(f) Fraudulent misconduct of the EMPLOYEE.
(g) In the event of a termination of the within
Employment Agreement for death or disability, EMPLOYEE will be entitled to
receive a pro-rata amount of stock options pro-rated over a calendar year to the
date of termination.
It is understood and agreed that both EMPLOYER and
EMPLOYEE agree that six months or 180 days prior to the termination of the
within Employment Agreement that EMPLOYER and EMPLOYEE will conduct good faith
negotiations to review the Employment Agreement for an additional term of five
(5) years.
EIGHTH: EMPLOYER agrees that EMPLOYEE will be entitled to all
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fringe benefits in effect by EMPLOYER, such as Blue Cross Blue Shield, Major
Medical, Disability or Life Insurance Benefits which are afforded to key
employees of the EMPLOYER.
NINTH: This Agreement contains the total and entire Agreement
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between the parties and shall, as of the effective date hereof, supersede any
and all other Agreements between the parties. The parties acknowledge and agree
that neither of them has made any representations that are not specifically set
forth herein and each of the parties hereto acknowledge that he or it has relied
upon his or its own judgment in entering into the same.
TENTH: The parties hereto do further agree that no waiver or
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modification of this Agreement or of any covenant, condition or limitation
herein contained, shall be valid, unless in writing and duly executed by the
party to be charged therewith, and that no evidence of any proceedings or
litigation between either of the parties arising out of or affecting this
Agreement or the rights and obligations of any party hereunder shall be valid
and binding unless such waiver or modification is in writing, duly executed, and
the parties further agree that the provisions of this paragraph may not be
waived, except as herein set forth.
ELEVENTH: The parties hereto agree that it is their intention and
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covenant that this Agreement and the performance hereunder shall be construed in
accordance with and under the laws of the State of New York, and that the terms
hereof may be enforced in any Court of competent jurisdiction in an action for
specific performance which may be instituted under this Agreement.
TWELFTH: EMPLOYEE warrants and represents to EMPLOYER that
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EMPLOYEE has had sufficient and adequate opportunity to consult with EMPLOYEE's
counsel concerning the within Agreement and is aware that EMPLOYER is relying
upon the within representation concerning entering into the Agreement herein.
THIRTEENTH: All notices required or permitted to be
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4
<PAGE>
given by either party hereunder shall be in writing and mailed by registered
mail, return receipt requested, and by regular mail to the other party addressed
as follows:
If to EMPLOYER at: Laser Master International, Inc.
1000 First Street
Harrison, NJ 07029
If to EMPLOYEE at:
Any notice mailed as provided above shall be deemed completed on the date of
receipt, or five (5) days from the postmark on said postal receipt.
IN WITNESS WHEREOF, the parties have hereunto set their hands and
seals on the day, month and year first above written.
LASER MASTER
INTERNATIONAL, INC.
By:
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------------------------------
5
Exhibit 3 - Form of
Employment Agreement
AGREEMENT effective as of March 26. 1996, by and between LASER MASTER
INTERNATIONAL, INC., having its principal place of business at 1000 First
Street, Harrison, New Jersey 07029 (hereinafter referred to as "EMPLOYER") and
ANTHONY J. CATALDO, residing at 4 High Meadows Road, Mount Kisco, New York 10545
(hereinafter referred to as "EMPLOYEE").
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, the EMPLOYER is engaged in the business of providing
commercial printing and engraving services to customers; and
WHEREAS, the EMPLOYER is desirous of employing EMPLOYEE; and
WHEREAS, in the opinion of the Board of Directors of EMPLOYER, the
success of the business operations of the EMPLOYER is contingent upon the
performance of the EMPLOYEE and in order to insure and provide for the terms and
conditions of EMPLOYEE's employment;
NOW, THEREFORE, IN CONSIDERATION OF THE MUTUAL
COVENANTS AND CONDITIONS HEREIN- AFTER SET FORTH, THE
PARTIES AGREE AS FOLLOWS:
FIRST: All prior understandings and/or Agreements between the
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parties are hereby deemed superseded and incorporated into the provisions of
this Agreement.
SECOND: The EMPLOYER does hereby employ, engage and hire the
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EMPLOYEE as Assistant Secretary and a Vice President of EMPLOYER for a period of
one year commencing March 26, 1996, and terminating April 27, 1997.
EMPLOYEE will serve as an Officer of EMPLOYER and will
be responsible for investor public relations, arranging for financing with
institutions, brokerage firms, review and negotiate potential merger and
acquisitions, coordinating of all stockholder matters, representation of the
Company at special and general meetings of stockholders, and to assist the
Company with respect to obtaining a NASDDAQ listing of its stock, assistance
with respect to capital and fund raising for the Company.
THIRD: The EMPLOYEE agrees that he will at all times
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faithfully, industriously and to the best of his ability, experience and talent,
perform all of the duties that may be required of and from him pursuant to the
expressed and implicit term hereof.
It is further understood and agreed that you will spend
such time, at your discretion on affairs of the Company, as you deem appropriate
in either New York, New Jersey or any other locale that requires your presence
on behalf of the Company.
You further understand and agree that you will not be
permitted to execute and/or bind the Company in any
<PAGE>
manner without a counter-signature and agreement of Mendel Klein as President
and Chairman of the Board.
FOURTH: The EMPLOYER shall pay to the EMPLOYEE and the EMPLOYEE
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agrees to accept from the EMPLOYER in full payment for the EMPLOYEE's services
hereunder, compensation at $150,000 per annum, as well as yearly vacation of
four (4) weeks.
EMPLOYER agrees to make available suitable
accommodations and transportation for EMPLOYEE for EMPLOYER requested trips in
and out of the continental United States. All verified expenses of EMPLOYEE
incurred during the course of employment will be paid by EMPLOYER as long as
said expenses are pre-approved by EMPLOYER.
EMPLOYEE will be entitled to participate in EMPLOYER
Stock Option Plans and will be awarded stock options based upon EMPLOYEE's
performance which will be reviewed on an annual basis by the EMPLOYER's
Compensation Committee, as a condition precedent to employment and as further
compensation, EMPLOYER agrees to issue to EMPLOYEE 131,225 shares of Restricted
Common Stock, par value $.01 per share. The shares of Common Stock to contain
the following restrictive legend:
"The shares represented by this certificate have
not been registered under the Securities Act of
1933. The shares have been acquired for
investment and may not be sold, transferred or
assigned in the absence of an effective
registration statement for these shares under the
Securities Act of 1933 or an opinion of the
Company's counsel that registration is not
required under said Act."
Additionally, EMPLOYEE will receive 100,000 stock
options to purchase 100,000 shares, for one (1) year at $1.00 per share, and
100,000 options for the two (2) years at $2.00 per share. EMPLOYER agrees to
grant cost free piggy back registration rights to EMPLOYEE for the shares of
common stock and the underlying the common stock options.
FIFTH: The EMPLOYEE shall devote working time, attention,
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knowledge and skill to the business and interest of the EMPLOYER and the
EMPLOYER shall be entitled to all benefits, emoluments, profits or other issues
arising from or incidental to any or all work, services and advice of the
EMPLOYEE and the EMPLOYEE expressly agrees that he will not during the term
hereof, be interested directly or indirectly, in any form, fashion or manner, as
a partner, officer, director, stockholder, advisor, or employee in any other
business similar to the business of the EMPLOYER. Nothing herein contained
shall, however, limit the rights of the EMPLOYEE to own up to twenty-five
percent (25%) of
2
<PAGE>
the capital stock or other securities of any corporation whose stock or
securities are publicly owned or traded regularly on a public exchange or in the
over-the-counter market nor shall anything herein contained be deemed to prevent
the EMPLOYEE from investing, or limiting the EMPLOYEE's rights to invest, in
other businesses not allied with the business of the EMPLOYER as long as
EMPLOYEE continues to devote time, attention, knowledge and skill to the
business and interest of the EMPLOYER. EMPLOYEE will be permitted to work with
other companies on a consulting basis at EMPLOYEE's discretion, as long as such
work does not interfere with the business of EMPLOYER.
SIXTH: During the course of EMPLOYEE's employment under the
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terms and conditions of this contract, and for one (l) year thereafter, the
EMPLOYEE further specifically agrees that he will not, at any time, in any
fashion, form or manner, either directly or indirectly, divulge, disclose or
communicate to any person, firm or corporation, in any manner whatsoever, any
proprietary information of any kind, nature or description concerning any
matters affecting or relating to the business of the EMPLOYER, including,
without limiting the generality of the foregoing, any of its customers, its
manner of operations, its plans, processes, programs, or other data of any kind,
nature or description without regard to whether any or all of the foregoing
matters shall be deemed confidential, material or important. The parties hereto
stipulate that as between them the same are important, material, confidential
and gravely affect the effective and successful conduct of the business of the
EMPLOYER and its good will, and that any breach of the terms of this paragraph
is a material breach thereof, except where the EMPLOYEE shall be acting on
behalf of the EMPLOYER.
EMPLOYEE understands and agrees that in the event that
EMPLOYEE violates the terms and conditions as stated in the within paragraph,
that he will be subject to an injunction and damages, and understands and agrees
that EMPLOYER's only immediate remedy to prevent further or continued damages
will be a petition for injunctive relief. EMPLOYEE further understands and
agrees that EMPLOYER, in entering into the within agreement, is relying upon
EMPLOYEE's representation and warranty that all trade secrets and other
proprietary information of EMPLOYER will be kept strictly confidential by
EMPLOYEE and not utilized by EMPLOYEE in any manner whatsoever other than on
EMPLOYER's behalf and during the course of EMPLOYEE's employment with EMPLOYER.
SEVENTH: It is expressly understood and agreed that the terms
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of this Agreement shall terminate prior to April 27, 1997, upon the happening of
the following events:
(a) Automatically and without notice upon the death of
the EMPLOYEE;
(b) Persistent absenteeism on the part of the
EMPLOYEE, however, such absenteeism is not to include absenteeism as a result of
ill health;
(c) Deliberate and wilful failure to perform normal
services and duties required of EMPLOYEE pursuant hereto except if the
performance of such duties or services would result in a breach of EMPLOYEE's
fiduciary responsibility.
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<PAGE>
(d) Conviction of a felony involving moral turpitude;
(e) Total or partial disability of the EMPLOYEE for a
period of four (4) consecutive months so that he is prevented from performing a
substantial part of his duties; it being further understood and agreed that any
proceeds received by EMPLOYER from a policy of disability benefits insurance or
any other proceeds received from any Federal, State or Municipal agency of
government will be a credit to the amount of compensation paid to EMPLOYEE by
EMPLOYER; and
(f) Fraudulent misconduct of the EMPLOYEE, and
(g) In the event that in the sole judgment of
EMPLOYER, EMPLOYEE is not performing his assigned duties and tasks, then and in
that event, upon written notice to EMPLOYEE, EMPLOYEE's employment may be
terminated by EMPLOYER. The right to terminate the within agreement will be
without any further liability on the part of the EMPLOYER, except for the
payment of all compensation as provided for herein.
EIGHTH: At EMPLOYER's discretion, EMPLOYEE will be entitled to
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all fringe benefits in effect by EMPLOYER such as Blue Cross Blue Shield, Major
Medical, disability or life insurance benefits which are afforded to key
employees of the EMPLOYER.
NINTH: This Agreement contains the total and entire agreement
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between the parties and shall, as of the effective date hereof, supersede any
and all other agreements between the parties. The parties acknowledge and agree
that neither of them has made any representations that are not specifically set
forth herein and each of the parties hereto acknowledge that he or it has relied
upon his or its own judgment in entering into the same.
TENTH: The parties hereto do further agree that no waiver or
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modification of this Agreement or of any covenant, condition or limitation
herein contained, shall be valid, unless in writing and duly executed by the
party to be charged therewith and that no evidence of any proceedings or
litigation between either of the parties arising out of or affecting this
Agreement or the rights and obligations of any party hereunder shall be valid
and binding unless such waiver or modification is in writing, duly executed, and
the parties further agree that the provisions of this paragraph may not be
waived except as herein set forth.
ELEVENTH: The parties hereto agree that it is their intention
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and covenant that this Agreement and the performance hereunder shall be
construed in accordance with and under the laws of the State of New York and
that the terms hereof may be enforced in any court of competent jurisdiction in
an action for specific performance which may be instituted under this Agreement.
TWELFTH: The parties agree that in the event of any dispute
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and/or controversy arising out of this Agreement, that jurisdiction in said
matter is conferred upon the New York State Supreme Court, New York County in
the County, City and State of New
4
<PAGE>
York, including an action for injunction which may be brought by EMPLOYER in the
New York State Supreme Court or any other court as warranted.
THIRTEENTH: EMPLOYEE warrants and represents to EMPLOYER that
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EMPLOYEE has had sufficient and adequate opportunity to consult with EMPLOYEE's
counsel concerning the within agreement and is aware that EMPLOYER is relying
upon the within representation concerning entering into the agreement herein.
FOURTEENTH: All notices required or permitted to be given by
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either party hereunder shall be in writing and mailed by registered mail, return
receipt requested and by regular mail to the other party addressed as follows:
If to EMPLOYER at:
LASER MASTER INTERNATIONAL, INC.
1000 First Street
Harrison, New Jersey 07025
If to EMPLOYEE at:
4 High Meadow Road
Mount Kisco, New York 10545
Any notice mailed as provided above shall be deemed completed on the date of
receipt, or five (5) days from the postmark on said postal receipt.
IN WITNESS WHEREOF, the parties have hereunto set their hands and seals as
of the effective date of the Agreement.
LASER MASTER INTERNATIONAL, INC.
By:
-----------------------------
MENDEL KLEIN, PRESIDENT
-----------------------------
ANTHONY J. CATALDO
5
Exhibit 4 - Form of
Stock Option Agreement
LASER MASTER INTERNATIONAL, INC.
STOCK OPTION AGREEMENT
STOCK OPTION AGREEMENT made as of this day of May, 1996, by and
between LASER MASTER INTERNATIONAL, INC., a New York corporation (hereinafter
referred to as the "Corporation" or "LMI"), and MENDEL KLEIN, hereinafter
referred to as "Option Holder" or "KLEIN");
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, the Corporation desires to afford Options to purchase shares of
Common Stock of LMI, par value of $.01 per share owned by the Corporation
(hereinafter referred to as the "Common Stock"), as hereinafter provided.
NOW, THEREFORE, IN CONSIDERATION OF THE MUTUAL
COVENANTS HEREINAFTER SET FORTH AND FOR OTHER GOOD
AND VALUABLE CONSIDERATION, THE PARTIES HERETO HAVE
AGREED, AND DO HEREBY AGREE, AS FOLLOWS:
1. Grant of Option: The Corporation hereby irrevocably grants to the
---------------
Option Holder the right and Options (hereinafter called the "Option") to pur-
chase all or any part of an aggregate of 1,200,000 shares of the Common Stock
$.01 par value of the Common Stock of LMI, subject to the terms and conditions
herein set forth.
2. Purchase Price: The purchase price of the shares of Common Stock
--------------
covered by the Option shall be $1.00 per share for 240,000 shares per year
until May 8, 2001.
3. Term of Option: The term of the Option shall be for a period of five
--------------
(5) years from the date hereof, as stated in Paragraph 2, subject to earlier
termination as provided herein. The Option may be exercised only after ninety
(90) days from the date hereof, except it may be exercised upon the Corpor-
ation's declaration and/or announcement that it has filed a voluntary Chapter 7
or 11 Proceeding; or if an involuntary Chapter 7 or 11 Proceeding is filed by
the Corporation. The purchase price of the shares, as to which this Option
shall be exercised, shall be paid in full, in cash, at the time of the exercise.
The Option Holder shall not have any of the rights of a stockholder with respect
to the shares covered by this Option, except to the extent that one or more
certificates for such shares shall be delivered to him upon the due exercise of
the Option.
4. Transferability: The Option shall be transferable at
---------------
1
<PAGE>
the discretion of the Option Holder with proper notice to the Corporation, and
the Option may be exercised, during the lifetime of the Option Holder or
transferee, only by him or her, or the entity that holds the Option. More
particularly, (but without limiting the generality of the foregoing), the Option
may be assigned, transferred, pledged, or hypothecated, and shall be assignable
by operation of law and shall not be subject to execution, attachment, or
similar process.
5. Changes in Capital Structure: If all or any portion of the Option
----------------------------
shall be exercised subsequent to any stock dividend, split-up, recapitalization,
merger, consolidation, combination for exchange or shares, separation,
reorganization, or liquidation occurring after the date hereof, as a result of
which shares of any class shall be issued in respect of outstanding shares of
Common Stock $.01 par value, or shares of Common Stock $.01 par value shall be
changed into the same or a different number of shares of the same or another
class or classes, the Option Holder shall receive, for the aggregate price paid
upon such exercise, the aggregate number and class of shares which, if shares of
Common Stock $.01 par value (as authorized at the date hereof) had been
purchased at the date hereof for the same aggregate price (on the basis of the
price per share set forth in paragraph 2 hereof) and had not been disposed of,
such Option Holder would be holding, at the time of such exercise, as a result
of such purchase and all such stock dividends, split-ups, recapitalization,
mergers, consolidations, combinations or exchanges of shares, separations,
reorganizations, or liquidations; provided, however, that no fractional share
shall be issued upon any such exercise, and the aggregate price paid shall be
appropriately reduced on account of any fractional share not issued.
6. Method of Exercising Option: Subject to the terms and conditions of
---------------------------
this Option Agreement, the Option may be exercised by written notice to the
Corporation, at its Stock Transfer Department. Such notice shall state the
election to exercise the Option and the number of shares in respect of which it
is being exercised, and shall be signed by the person or persons so exercising
the Option. Such notice shall either: (a) be accompanied by payment of the
full purchase price of such shares, in which event the Corporation shall deliver
or cause to be delivered a certificate or certificates representing such shares
as soon as practicable after the notice shall be received; or (b) fix a date
(not less than five (5) nor more than fifteen (15) business days from the date
such notice shall be received by the Corporation) for the payment of the full
purchase price of such shares at the Stock Transfer Department, against delivery
of a certificate or certificates representing such shares. Payment of such
purchase price shall, in either case, be made by check payable to the order of
the Corporation. The certificate or certificates for the shares as to which the
Option shall have been so exercised shall be registered in the name of the
persons or persons so exercising the Option (or, if the Option shall be
exercised by the Option Holder and if the Option Holder shall so request in the
2
<PAGE>
notice exercising the Option, shall be registered in the name of the Option
Holder and another person jointly, with right of survivorship) and shall be
delivered as provided above to or upon the written order of the person or
persons exercising the Option. In the event the Option shall be exercised,
pursuant to paragraph 7 hereof, by any persons or persons other than the Option
Holder, such notice shall be accompanied by appropriate proof of the right of
such person or persons to exercise the Option. All shares that shall be
purchased upon the exercise of the Option as provided herein be fully paid and
non-assessable.
7. General: The Corporation shall at all times during the term of the
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Option reserve and keep available such number of shares of Common Stock as will
be sufficient to satisfy the requirements of this Option Agreement, shall pay
all original issue and transfer taxes with respect to the issue and transfer of
shares pursuant hereto and all other fees and expenses necessarily incurred by
the Corporation in connection therewith, and will from time to time use its best
efforts to comply with all laws and regulations which, in the option of counsel
for the Corporation, shall be applicable thereof.
8. The Option Holder is entitled to a cost-free right of registration
with respect to the Option granted herein, and the Corporation agrees to use its
best efforts to register the underlying shares with respect to the within Option
within ninety (90) days from the date hereof.
IN WITNESS WHEREOF, the Corporation has caused this Option Agreement to
be duly executed by its Officers thereunto duly authorized, and the Option
Holder has hereunto set its hand and
seal, all on the day and year first above written.
LASER MASTER INTERNATIONAL, INC.
By:
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LEAH KLEIN,
Vice President and Secretary
--------------------------------------
MENDEL KLEIN
3
