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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) January 31, 1996
PHOTOCOMM, INC.
Incorporated in the State of Arizona IRS No. 86-0411983
Commission File Number: 0-12807
7681 East Gray Road
Scottsdale, Arizona 85260
(602) 948-8003
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INFORMATION TO BE INCLUDED IN THE REPORT
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS.
Effective January 31, 1996, Photocomm, Inc. ("Photocomm" or the
"Company") acquired all of the assets and assumed certain liabilities of Jadco
Manufacturing, Inc. ("Jadco"), a solar electric pumping products manufacturer
located in Safford, Arizona (the "Acquisition"). The Acquisition was
consummated in accordance with the terms of an Agreement and Plan of
Reorganization between Photocomm, Jadco, and James C. Allen the founder and
majority shareholder of Jadco ("Allen") dated as of January 31, 1996 (the
"Agreement").
The aggregate consideration paid by Photocomm in connection with the
Acquisition was approximately $300,000 in cash and 560,000 shares of Photocomm's
Common Stock, $0.10 par value, valued at $1,400,000. Photocomm also assumed
liabilities of Jadco of approximately $10,000.
The aggregate consideration paid in the Acquisition was determined
through arm's length negotiations between representatives of Photocomm and
Jadco. Neither Photocomm nor, to the knowledge of Photocomm, any affiliate,
director or officer of Photocomm, or any associate of any director or officer
of Photocomm, had any material relationship with Jadco prior to the
Acquisition.
The assets purchased principally consist of certain inventories and
other assets valued by the parties at approximately $700,000; and goodwill and
intangible assets valued by the parties at $1,000,000. Following the
acquisition, Photocomm intends to continue using the assets purchased for
substantially the same purposes as they were used before the Acquisition.
In connection with the Acquisition, Allen entered into Covenants Not
to Compete with the Company pursuant to which the Company will make monthly
payments in a total aggregate amount of $150,000 over the next five years.
Jadco will become a division of Photocomm, will continue to conduct business as
usual with its present staff, and Allen will continue to direct division
operations as a Photocomm management employee.
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As of January 31, 1996, all current employees of Jadco became
employees of Photocomm. Jadco is expected to remain headquartered in Safford,
Arizona.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(a) Financial Statements of Business Acquired.
Audited financial statements are not available for Jadco.
Accordingly, pursuant to Item 310(c)(3)(ii) of Regulation S-B,
Photocomm will not be filing financial statements for Jadco.
(b) Pro Forma Financial Information.
At the time of the filing of this Report on Form 8-K, it is
impractical to provide the required pro forma financial
information. The required pro forma financial information
will be filed by Photocomm as soon as practicable, but not
later than 60 days following the date upon which this Report
on Form 8-K is filed.
(c) Exhibits.
<TABLE>
<CAPTION>
Exhibit Method of
Number Description Filing
- ------- ----------- ---------
<S> <C> <C>
1 Agreement and Plan of Reorganization Filed
between Photocomm, Inc., Jadco herewith
Manufacturing, Inc. and James C. Allen
dated as of January 31, 1996
2 Photocomm's Press Release dated Filed
February 2, 1996 herewith
</TABLE>
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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 by the
undersigned hereunto duly authorized.
PHOTOCOMM, INC.
Dated: February 14, 1996 By /s/ Thomas C. LaVoy
------------------------------------
Thomas C. LaVoy
Chief Financial Officer
(Duly Authorized Officer
and Principal Financial
Officer)
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EXHIBIT 1
AGREEMENT AND PLAN OF REORGANIZATION
THIS AGREEMENT ("Agreement") is made and entered into as of the 31st day of
January, 1996, by and among PHOTOCOMM, INC., an Arizona corporation
("Photocomm"), JADCO MANUFACTURING , INC., an Arizona corporation ("Jadco"),
and JAMES C. ALLEN ("Allen").
RECITALS:
A. The respective Boards of Directors of Photocomm and Jadco have
concluded that it is to their respective mutual advantage and benefit to effect
a reorganization whereby Photocomm will acquire substantially all of the assets
of Jadco in consideration solely of voting stock of Photocomm in accordance
with the terms and conditions contained herein, such transaction to be a
reorganization under Section 368(a)(1)(C) of the Internal Revenue Code of 1986,
as amended.
B. Jadco intends, as a condition precedent to such transaction, to
authorize and adopt a plan of complete liquidation and, following the adoption
of such plan and such transaction, to carry out such liquidation.
AGREEMENT
NOW, THEREFORE, in consideration of the mutual agreements and subject to the
terms and conditions set forth in this Agreement, the parties agree as follows:
1.0 SALE OF ASSETS OF JADCO TO PHOTOCOMM. Upon and subject to
the terms and conditions herein stated, Photocomm agrees to acquire from Jadco
and Jadco agrees to transfer, assign and convey to Photocomm upon the Closing
Date (as hereinafter defined), free and clear of all debts, liens and
encumbrances (except as otherwise provided in this Agreement), all of the
assets and properties of Jadco (the "Assets"),on an AS IS, WHERE IS basis,
including all of the business, goodwill, assets, properties and rights of every
nature, kind and description, whether tangible or intangible, real, personal or
mixed, wherever located and whether or not carried or reflected on the books
and records of Jadco, which are owned by Jadco or in which Jadco has any
interest (including the right to use), excepting only the Excluded Assets and
any of the foregoing which relate exclusively to the Excluded Assets. The
Assets shall include, but are not limited to, the following:
1.1 Inventories. All inventories, including, without limitation,
inventory of raw materials, work in process, storehouse stocks, materials,
supplies, finished goods and consigned goods owned by Jadco or in which Jadco
has any interest, whether located on Jadco's business premises, in transit to
or from such premises, in storage facilities or otherwise. Attached hereto as
Schedule 1.1 is a complete list of such Inventory as of December 31, 1995. An
updated list of such Inventory as of the Closing Date shall be delivered to
Photocomm upon the Closing Date.
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1.2 Tangible Personal Property. All tangible personal property
including all machinery, equipment, trucks, automobiles, furniture, supplies,
spare parts, tools, stores and other tangible personal property owned by Jadco
or in which Jadco has any interest, other than the Inventories. Attached
hereto as Schedule 1.2 is a complete list of such Tangible Personal Property as
of December 31, 1995.
1.3 Intangible Personal Property. All intangible personal
property including all intangible properties owned by Jadco or in which Jadco
has any interest, including, but not limited to (i) the names "Jadco" and
"Solarjack" and any other registered or unregistered trademarks, service marks,
trade names and slogans, all applications therefor, and all associated
goodwill; (ii) all statutory, common law or registered copyrights, all
applications therefore and all associated goodwill; (iii) all patents and
patent applications, all associated technical information, shop rights,
know-how, trade secrets, processes, operating, maintenance, and other manuals,
drawings and specifications, process flow diagrams and related data, and all
associated goodwill; (iv) all "software" and documentation thereof, (including
all electronic data processing systems and program specifications, source
codes, input data and report layouts and formats, records, files, layouts, or
diagrams, functional specifications and narrative descriptions, or flow
charts); (v) all other inventions, discoveries, improvements, processes,
formulae (secret or otherwise), data, drawings, specifications, trade secrets,
confidential information, know-how and ideas (including those in possession of
third-parties, but which are the property of Jadco), and all drawings, records,
books or other tangible media embodying the foregoing, and (vi) all lists of
customers of Jadco, whether such customers are past, present or only
prospective customers of Jadco. Attached hereto as Schedule 1.3 is a complete
list of such Intangible Personal Property as of December 31, 1995.
1.4 Prepaid Items. All prepaid items including insurance
deposits, municipal or local tax payments or deposits, utility deposits and the
like, deferred charges, reserve accounts and other security or similar deposits
owned by Jadco or in which Jadco has any interest. Attached hereto as Schedule
1.4 is a complete list of such Prepaid Items as of December 31, 1995.
1.5 Licenses and Permits. All licenses and permits issued to Jadco
in which Jadco has any interest.
1.6 Contracts and Other Agreements. All contracts and other
agreements, including contracts, agreements, warranties, guarantees,
indentures, bonds, options, leases, subleases, easements, mortgages, plans,
licenses, purchase orders, sales orders, commitments or binding arrangements of
any nature whatsoever, express or implied, written or unwritten, and all
amendments thereto, entered into by or binding upon Jadco or to which any of
its properties may be subject, other than those, if any, which constitute
Excluded Assets or relate exclusively to the Excluded Assets. Attached hereto
as Schedule 1.6 is a complete list of such Contracts and Other Agreements as of
the date hereof.
1.7 Books and Records. All books and records of Jadco including
ledgers, employee records, customer lists, files, correspondence, and other
written records of every kind owned by Jadco or in which Jadco has any
interest, other than those, if any, which constitute Excluded Assets or relate
exclusively to the Excluded Assets.
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1.8 Warranties. All warranties or other rights of Jadco under
express or implied warranties from suppliers or contractors with respect to the
Assets to the extent assignable.
1.9 Goodwill. All goodwill of Jadco as a going concern.
1.10 Other Properties. All other properties, tangible and
intangible, not otherwise referred to above which are owned by Jadco or in
which it has any interest, other than those, if any, which constitute Excluded
Assets or relate exclusively to the Excluded Assets.
Value of Certain Assets. The Inventory and Tangible Personal Property
(Schedules 1.1 and 1.2) to be acquired by Photocomm hereunder shall have an
aggregate value of not less than $700,000.
Excluded specifically from the Assets which Jadco has agreed to sell
to Photocomm are the following Assets ("Excluded Assets") which shall be
retained by Jadco:
1.11 Accounts Receivable. All accounts receivable of Jadco,
including all accounts, notes, accounts receivable, contract rights, drafts,
and other forms of claims, demands, instruments, receivables and rights to the
payment of money or other forms of consideration, whether for goods sold or
leased, services performed or to be preformed, or otherwise, owned by Jadco or
in which Jadco has any interest, together with all guarantees, security
agreements and rights and interests securing the same.
1.12 Cash and Cash Equivalents. All cash and cash equivalents,
including actual cash, bank accounts, certificates of deposits, banker's
acceptances, United States Government (or agency) securities, or other
securities owned by Jadco or in which Jadco has any interest.
1.13 Corporate Records. The stock record books, the corporate
seal, minute books and other documents and records relating to the organization
of Jadco, all of Jadco's tax and information returns; all correspondence
between Jadco and its shareholders; and all other financial records of Jadco
which do not relate in any way to Jadco's ownership and operation of the Assets
or its business; provided, however, that upon reasonable notice from Photocomm
to Jadco or its successors in interest based upon reasonable cause, Jadco or
its successors in interest shall provide Photocomm with access at no charge to
any of the foregoing described material and with copies of said documents.
1.14 Tax Refunds. All of Jadco's rights to refunds of all or any
part of any taxes paid by Jadco in relation to periods prior to the Closing
Date.
1.15 Agreement Rights. The rights of Jadco under this Agreement.
1.16 Treasury Shares. Any shares of Jadco's capital stock held in
treasury.
1.17 Claims Against Shareholders, Etc. All of Jadco's claims,
causes of action, chosen in action, and rights of set-off of any kind against
or pertaining to its shareholders, officers and directors.
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2.0 ASSUMPTION OF LIABILITIES.
2.1 Assumed Liabilities. Photocomm shall not assume and shall
not become liable for any liabilities of Jadco, except product warranty
obligations with regard to items previously sold by Jadco (the "Assumed
Liabilities"), provided, however, that such product warranty liabilities
assumed by Photocomm shall not exceed the sum of $10,000 in the aggregate.
2.2 Excluded Liabilities. All of the liabilities not specifically
assumed by Photocomm pursuant to paragraph 2.1 above shall remain the
liabilities of Jadco (the "Excluded Liabilities"). Jadco agrees to indemnify
and hold harmless Photocomm, as well as its successors and assigns, from any
and all claims, charges, liabilities and expenses, including reasonable
attorney's fees, relating in any way to the Excluded Liabilities. The Excluded
Liabilities include, but are not limited to the following:
(a) All obligations and liabilities of Jadco incurred in
the ordinary course of its business on or before the Closing Date (except
product warranty liabilities as set forth in paragraph 2.1 above).
(b) All obligations and liabilities with respect to
employee wages and benefits, including specifically, unfunded employee benefit
plan obligations, and any taxes related thereto accrued prior to the Closing
Date or severance obligation for any personnel whose severance occurs prior to
or on the Closing Date.
(c) Any obligations of Jadco to perform this Agreement.
(d) Any obligation or liability of Jadco that is not
accrued or incurred by Jadco on or before the Closing Date. Notwithstanding
the foregoing, Photocomm shall pay for goods in transit to Jadco as of the
Closing Date upon their receipt. Jadco shall provide a list of such goods in
transit to Photocomm upon the Closing Date.
(e) Any liability of Jadco to its stockholders.
(f) Any liability of Jadco with respect to its
outstanding shares or any warrants, obligations, or rights to purchase its
shares.
(g) Any liability for taxes, except as may be expressly
assumed hereunder.
(h) Any liability known or unknown, not assumed by
Photocomm under the provisions of Section 2.1 above.
3.0 CONSIDERATION FOR ASSETS. In consideration of and in exchange
for the transfer, assignment and conveyance of the Assets, in addition to the
assumption of Assumed Liabilities, Photocomm shall pay to Jadco the following:
(a) $300,000 by Cashier's Check drawn upon First
Interstate Bank of Arizona in favor of Jadco upon the
Closing Date, to be deemed paid upon complete
negotiation in the ordinary course.
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(b) Photocomm shall issue to Jadco 560,000 shares of its
Common Stock, $0.10 par value, which shares shall be
valued in the amount of $1,400,000.00. Upon
issuance, said shares shall not have been registered
under the Securities Act of 1933 or any similar state
securities laws, shall be registered in the name of
Jadco and shall be issued from unreserved authorized,
but unissued Common Stock of Photocomm.
The parties shall determine the final allocation of the aggregate purchase
price among the Assets as of the Closing Date, which allocation shall be used
on Form 8594, if required, and any other notice or filing required pursuant to
section 1060 of the Internal Revenue Code of 1986, as amended (the "Code").
4.0 REPRESENTATIONS AND WARRANTIES OF JADCO AND ALLEN. Jadco and
Allen represent and warrant to Photocomm as follows, and acknowledge and
confirm that Photocomm is relying upon such representations and warranties in
connection with the execution, delivery and performance of this Agreement,
notwithstanding any investigation made by Photocomm or on its behalf:
4.1. Organization and Standing. Jadco is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Arizona, has all of the requisite corporate power and authority and has all of
the licenses, permits, authorities and consents that are necessary to own,
operate and lease its properties and to carry on its business as now being
conducted. Jadco is duly qualified to do business and is in good standing as a
foreign corporation in all jurisdictions in which the property owned, leased or
operated by Jadco or the nature of the business conducted by Jadco makes such
qualification necessary. Jadco is not a party to or subject to any agreement,
consent decree or order, or other understanding or arrangement with, or any
directive of, any governmental authority or other person which imposes any
restriction or otherwise affects in any material way the conduct of its
business in any jurisdiction or location. True and accurate copies of Jadco's
Articles of Incorporation, as amended, and By-laws, as presently in effect, are
attached as Schedule 4.1 to this Agreement.
4.2. Capitalization. Presently and at the Closing Date, the
authorized capital of Jadco consists solely of 10,000,000 shares of common
stock, $1.00 par value, of which 50,000 shares have been validly issued and are
now outstanding, ninety (90%) percent of which are owned by Allen. All such
shares of capital stock have been validly authorized and issued and are fully
paid and nonassessable.
4.3. Subsidiaries. Jadco has no subsidiaries or affiliated
companies and does not otherwise presently own or control, directly or
indirectly, any other corporation, association, or other business entity.
4.4. Authorization. Jadco has all the requisite legal and
corporate power and authority to execute and deliver this Agreement and to
consummate the transactions contemplated hereby. All corporate action on the
part of Jadco and its officers, directors and stockholders necessary for the
authorization, execution, delivery, and performance of all obligations of Jadco
under this Agreement has been (or will be) taken prior to the Closing. This
Agreement, when executed and delivered, shall constitute a legal, valid and
binding obligation of Jadco and Allen, enforceable in accordance with its
terms.
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4.5. Governmental Consents. No consent, approval, order, or
authorization of, or registration, qualification, designation, declaration or
filing with, any federal, state or local governmental authority is required on
the part of Jadco in connection with the execution, delivery or performance of
this Agreement or consummation of the transactions contemplated hereby.
4.6. Compliance with Other Instruments. Jadco will not be, as a
result of the execution, delivery or performance of this Agreement, in
violation of or default under any provision of its Articles of Incorporation or
By-laws, as amended and in effect on the date hereof, or of any provision of
any instrument, contract or lease to which it is a party, or of any provision
of any federal or state judgment, writ, decree, order, statute, rule, or
governmental regulation applicable to Jadco.
4.7. Financial Statements. An unaudited balance sheet and income
statement as of and for each of the calendar years ending December 31, 1995 and
1994 (collectively, the "Jadco Financials"), are attached hereto as Schedule
4.7.
The Jadco Financials have been prepared by management, are true and
correct and fairly present the financial position of Jadco as of their
respective dates and the results of its operations for the periods then ended
and contain all adjustments (consisting of normal recurring accruals)
considered necessary for a fair presentation. Jadco has established a standard
system of accounting and has consistently carried out and administered the
same. Except to the extent reflected or reserved against or disclosed in the
Jadco Financial Statements, as of their respective dates, Jadco has not
incurred any material liabilities or obligations of any kind, whether accrued,
absolute, contingent or otherwise, which should have been so reflected or
reserved against or disclosed (including, without limitation, all liabilities
to vendors and customers of Jadco).
4.8 Undisclosed Liabilities. Jadco has no liabilities or
obligations, either absolute, accrued, contingent or otherwise, which
individually or in the aggregate are materially adverse to the financial
condition and business of Jadco, which (i) have not been reflected in the Jadco
Financials, (ii) have not been described in this Agreement or in any of the
Schedules hereto, or (iii) have not been incurred in the ordinary course of
business since December 31, 1995, consistent with past practices.
4.9 Inventory. The inventory of Jadco, as reflected in the Jadco
Financial, consists of a quality and quantity usable and saleable in the
ordinary course of business. The inventory does not include any obsolete or
discontinued items, but may include old, but saleable merchandise of not more
than $5,000. The inventory is stored and/or located at premises owned or
leased by Jadco or at Jadco's suppliers. The value at which Jadco's inventory
is reflected in the Jadco Financials is the lower of cost or market on a
first-in, first-out basis and reflects write-offs or write-downs for damaged or
obsolete items in accordance with the historical inventory policy and practices
of Jadco. Jadco has not transferred inventory on consignment or granted return
privileges to any purchaser of its goods, other than in the ordinary course of
business.
4.10. No Prebillings. Jadco has not prebilled or received payment,
and Jadco will not prebill or receive payment, from any of its accounts for
goods to be delivered or for services to be rendered or for expenses to be
incurred subsequent to the Closing Date, other than in the
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ordinary course of business, which shall amount to not more than $5,000.00 as
of the Closing Date. Jadco does not book any such prebilling received as a
sale, nor does it book any profit therefrom prior to its actual shipment of the
products ordered. To the extent Jadco has received such prebillings Jadco
shall hold such monies in trust and shall deliver the same to Photocomm upon
the Closing Date.
4.11. Changes. Except as set forth in Schedule 4.12, since December
31, 1995:
(a) Jadco has not entered into any transaction which was
not in the ordinary course of business;
(b) There has been no adverse change in the condition
(financial or otherwise), business, property, assets or liabilities of Jadco
other than changes in the ordinary course of business, none of which,
individually or in the aggregate, has been material;
(c) There has been no damage to, destruction of or loss
of physical property (whether or not covered by insurance) adverse to the
business or operations of Jadco;
(d) Jadco has not increased the compensation of any of
its officers or the rate of pay of their employees as a group, except as part
of regular compensation increases in the ordinary course of business;
(e) There has been no resignation or termination of
employment of any key officer or employee of Jadco, and Jadco does not know of
any impending resignation or termination of employment of any such officer or
employee that if consummated would have an adverse effect on the business of
Jadco;
(f) There has been no labor dispute involving Jadco or
any of its employees and none is pending or, to the best of Jadco's knowledge,
threatened;
(g) There have not been any changes, except in the
ordinary course of business, in the contingent obligations of Jadco, by way of
guaranty, endorsement, indemnity, warranty or otherwise;
(h) There have not been any loans made by Jadco to any of
its employees, officers or directors other than travel advances and office
advances made in the ordinary course of business;
(i) There has been no litigation or administrative agency
charges or proceedings commenced involving, relating to or affecting the
business of Jadco; and
(j) There has been no other event or condition of any
character pertaining to and materially adverse to the Assets or business of
Jadco.
4.12 Title to Assets; Liens, etc. The Assets, both real, personal
and mixed, tangible and intangible, necessary or useful to the operation of the
business of Jadco are in good condition and repair, ordinary wear and tear
excepted, and suitable for the uses intended. The Assets are being maintained
in a state of good repair, and, in all respects, comply with and are operated
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in conformity with all applicable laws, ordinances, regulations, orders,
permits and other requirements relating thereto adopted or currently in effect.
Jadco has good and marketable title to the Assets, free and clear of all liens,
other than the lien for current taxes not yet due and payable and liens set
forth on Schedule 4.12. Schedule 4.12 identifies and sets forth a complete list
of each parcel of real estate or interest therein owned or leased by Jadco.
The buildings and improvements owned or leased by Jadco and the uses thereof do
not contravene any zoning or building law or ordinance or violate any
restrictive covenant. Each lease of real property creates a legal, valid and
enforceable leasehold interest in favor of Jadco, free and clear of all liens.
No default or event of default on the part of Jadco, as lessee or mortgagor, as
the case may be, exists with respect to any lease or mortgage (and related loan
documents) with respect to such real property.
4.13 Patents and Other Intangible Intellectual Assets.
(a) Schedule 1.13 sets forth a complete and correct list
of Jadco's intellectual property, including but not limited to domestic and
foreign patents, patent applications, written records of inventions, registered
and unregistered trademarks, trade names, service marks, certification marks,
copyrights and registration applications for the above, and licenses to and
from third parties relating to any of the above.
(b) Except as set forth in Schedule 1.13, Jadco (i) has
legal and equitable title to, or has by license or other grant, the right to
use, free and clear of all liens, all proprietary technology or information,
patents, both domestic and foreign, all registered and unregistered trademarks,
trade names, service marks, certification marks, copyrights, and applications
for any and all of the above used in the conduct of its business as now
conducted; (ii) does not, to the best of Jadco's knowledge, infringe upon the
patent, trademark, trade name, service mark, copyright or proprietary
information rights of any third party in the conduct of its business as now
conducted; (iii) is not obligated or under any liability whatsoever to make any
payments by way of royalties, fees or otherwise to any owner of, licensor of,
or other claimant to any patent, trademark, trade name, service mark,
certification mark, copyright or proprietary technology or information with
respect to the use thereof or in connection with the conduct of its business or
otherwise; (iv) has not licensed or granted any rights to any third parties
under its patents, trademarks, trade names, service marks, certification marks,
copyrights or proprietary technology or information used in the conduct of its
business; (v) has no notice, knowledge or belief that any of Jadco's patents,
trademarks, trade names, service marks, certification marks or copyrights are
invalid, and all registrations, where filed, are subsisting and are registered
in the name of Jadco; and (vi) has no notice, knowledge or belief that any of
the technology or information used in the conduct of its business was illegally
obtained.
(c) Jadco employs procedures in its daily operations to
maintain the proprietary nature of, owns and has the unrestricted right to use
all trade secrets, including know-how, inventions, designs, processes, computer
software and documentation for such software and technical data required for or
incident to the development, manufacture, operation and sale of all products
and services sold by Jadco, free and clear of any liens, including without
limitation, all claims of current and former employees, consultants, officers,
directors and stockholders of Jadco. Each employee and officer of Jadco has
executed an agreement with Jadco regarding confidentiality and proprietary
information. Jadco, after reasonable investigation, is
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not aware that any of its employees are in violation thereof, and Jadco will
use its best efforts to prevent any such violation.
4.14. Contracts and Obligations. Set forth in Schedule 4.14 is a
list of all material written and oral agreements, contracts, indebtedness,
liabilities and other obligations to which Jadco is a party or by which it is
bound which (a) obligate Jadco to share, license or develop any product or
technology; (b) involve transactions or proposed transactions between Jadco and
its officers, directors, stockholders, affiliates or any affiliate thereof; (c)
involve strategic arrangements or cooperation agreements; (d) involve
commitments for inventory items or supplies in excess of $10,000; (e) are for a
term longer than twelve (12) months; (f) are written distribution or dealer
agreements; (g) are with the United States of America; or (h) involve receipts
or expenditures by Jadco greater than $50,000 in any twelve-month period.
Copies of written, and summaries of oral, agreements, contracts, indebtedness,
liabilities and obligations have been made available for inspection by
Photocomm. True and correct copies of the foregoing shall be delivered to
Photocomm at Closing. All such agreements are legal, valid and binding
obligations and are in full force and effect in all respects. Except as set
forth in Schedule 4.14, Jadco has avoided every condition and has not performed
any act the occurrence of which would result in Jadco's loss of any right
granted under any license, distribution or other agreement.
4.15 Catalogs and Promotional Literature. Neither the use nor the
distribution of any advertising or promotional materials, including catalogs,
violates, infringes or conflicts with any statutory or common law copyright,
trademark, or other intellectual, proprietary, personal or other right of any
person. Jadco has provided Photocomm with, or made available to Photocomm,
copies of all promotional material distributed by Jadco during the past two (2)
years.
4.16 Products; Warranty Provisions.
(a) Other than the standard warranties of Jadco as set
forth in Schedule 4.16 or product manufacturer warranties, there are no product
warranties applicable to its business, whether express, implied or otherwise.
(b) Jadco has no pattern of claims or actions based upon
allegations of the same or similar product defect for any of its products.
(c) During the past two (2) years there has not been any
material product recall, rework or retrofit relating to any line of product
manufactured, shipped or sold by Jadco, nor, to Jadco's knowledge, is there any
basis for any such product recall, rework or retrofit.
4.17 Conflicts of Interest; Transactions with Principals. No
officer, director or stockholder of Jadco and no affiliate (as defined under
the Securities Act of 1933, as amended) of any such officer, director or
stockholder has, either directly or indirectly, (a) an interest in any
corporation, partnership, proprietorship, association or other person or entity
which furnishes or sells services or products to Jadco or which purchases
services or products from Jadco or whose services or products are similar to
those furnished or sold by Jadco, or (b) a beneficial interest in any contract,
agreement or commitment to which Jadco may be bound as of the Closing Date.
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4.18 Outstanding Indebtedness. Jadco has no indebtedness for
borrowed money (including deferred compensation) which Jadco has directly or
indirectly created, incurred, assumed or guaranteed, or with respect to which
Jadco has otherwise become directly or indirectly liable, other than as
disclosed in the Jadco Financial Statements.
4.19 Employees. Except as set forth in Schedule 4.19, Jadco has no
employment contracts with any of its employees which are not terminable at will
or any consulting or independent contractor agreements with any individual or
entity, and it does not have any collective bargaining agreements covering any
of its employees. There are no employee or labor disagreements or union
organization activities pending or threatened between Jadco and its employees,
and Jadco is not a party to any union or collective bargaining agreement.
Jadco complied with all applicable federal and state equal employment
opportunity laws and other laws related to employment. Jadco is not aware that
any officer or key employee, or that any group of key employees, intends to
terminate their employment with Jadco (or Photocomm if Photocomm elects to
employ said persons subsequent to the Closing Date), whether as a result of the
transactions contemplated hereby or otherwise, nor does Jadco have a present
intention to terminate the employment of any of the foregoing (except
subsequent to the Closing Date). To Jadco's knowledge, no employee of Jadco is
in violation of any term of any employment contract, patent, proprietary
information disclosure agreement or any other contract or agreement relating to
the right of any such employee to be employed by Jadco because of the nature of
the business conducted by Jadco or for any other reason, and the continued
employment by Jadco of its present employees will not result in any such
violation.
4.20 Employee Benefit Plans.
(a) Schedule 4.20 sets forth:
(i) all "employee welfare benefit plans," as defined in
Section 3(1) of the Employee Retirement Income Security Act of 1974, as amended
("ERISA"), and any other employee benefit arrangements or payroll practices,
including, without limitation, sick leave, vacation pay, salary continuation
for disability, severance, hospitalization, medical insurance, and life
insurance programs maintained by Jadco or each trade or business under common
control with Jadco (as determined under Section 4001(b)(1) of ERISA, an "ERISA
Affiliate") or to which Jadco or any ERISA Affiliate has made contributions
during the preceding five (5) years (the "Welfare Plans"); and
(ii) all "employee pension benefit plans," as defined in
Section 3(2) of ERISA, maintained by Jadco or any ERISA Affiliate or to which
Jadco or any ERISA Affiliate has made contributions during the preceding five
(5) years thereunder, including, without limitation, retirement, pension,
savings, profit sharing, severance and stock purchase programs (the "Pension
Plans"). The Welfare Plans and Pension Plans are hereinafter collectively
referred to as the "Employee Benefit Plans."
(b) No Jadco Employee Benefit Plan is required to be
qualified under ERISA or other applicable laws. There is no violation of ERISA
with respect to the filing of any applicable reports, documents and notices
regarding the Employee Benefit Plans with the Secretary of Labor and the
Secretary of the Treasury or the furnishing of such documents to the
participants or beneficiaries of the Employee Benefit Plans.
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(c) Jadco does not maintain retiree life or retiree
health insurance plans which provide for continuing benefits or coverage for
any participant or any beneficiary of a participant after termination of
employment except as may be required under the Consolidated Omnibus Budget
Reconciliation Act of 1985, as amended ("COBRA").
(d) Jadco is in compliance with the notice and
continuation requirements of COBRA and the regulations thereunder.
(e) Jadco has no formal plan or commitment, whether
legally binding or not, to create any additional Employee Benefit Plans or
arrangement or modify or change any existing Employee Benefit Plan, which would
affect any employee or former employee of Jadco.
(f) Neither the execution or delivery of this Agreement
nor the consummation of the transactions contemplated hereby will result in any
rights under any of the Employee Benefit Plans becoming exercisable by the
holders thereof or result in the creation or vesting of any rights in such
holder under any of the Employee Benefit Plans, or accelerate the time of
payment or vesting or increase the amount of compensation or benefits due to
any director, officer, employee or former employee of Jadco.
4.21 Taxes. Jadco has filed all federal, state, county, local and
foreign tax returns, reports and forms for income, excise, social security,
property, payroll, unemployment and other taxes which are required to be filed
by it, including all sales tax returns with respect to direct sales made by
Jadco ("Tax Returns"). Jadco has paid, or adequate provision has been made on
the Jadco Financials for the payment of, all federal, state, county, local and
foreign taxes, assessments, levies or duties, howsoever measured or imposed,
and related interest and penalties, if any (collectively, "Taxes"). No Taxes
in addition to those so paid or provided for shall be assessed or levied
against or become due or payable by Jadco on or after the Closing Date in
respect to the period prior to and including the Closing Date, except as shall
be paid by Jadco. No unexpired waiver of the applicable statute of limitations
with respect to any taxable year has been executed by Jadco. There are no tax
examinations or audits underway involving Jadco.
4.22 No Sales or Conveyance Tax Due. No sales, use or other
transfer or conveyance taxes are or will become payable by any of the parties
to this Agreement as a consequence of the execution, delivery or performance of
this Agreement or any of the Additional Agreements (as hereinafter defined),
other than taxes based upon the net income of the parties. Jadco shall be
responsible for and shall promptly pay any such sales, use, transfer or
conveyance taxes which become payable with respect thereto.
4.23 Insurance. Except as set forth of Schedule 4.23, all Assets
of Jadco are covered by such fire, casualty, product liability, environmental
liability and other insurance policies issued by reputable insurers as are
customarily obtained to cover comparable properties and assets by businesses in
the region in which the Assets are located, in amounts, scope and coverage
which are reasonable in light of existing conditions. Schedule 4.23 sets forth
a list and description of all of the policies of insurance and fidelity or
surety bonds carried by Jadco, including, but not limited to, fire, liability,
product liability, workers' compensation, officers' life, and directors' and
officers' liability insurance policies. Jadco has not failed to give any
notice or present any material claim under any insurance policy in due and
timely fashion and all insurance premiums
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due and payable by Jadco in connection with the policies set forth on Schedule
4.23 prior to the Closing Date have been paid. During the past five (5) years,
Jadco has not experienced any uninsured losses in respect of any claims against
Jadco, coverage for which claims customarily would be provided by the policies
set forth in Schedule 4.23 or predecessors thereto. There are no outstanding
written requirements or written recommendations by any insurance company that
issued a policy with respect to any of the Assets, by any Board of Fire
Underwriters or other body exercising similar functions or by any governmental
authority requiring or recommending any repairs or other work to be done on or
with respect to any of the Assets or requiring or recommending any equipment or
facilities to be installed on or in connection with any of the Assets. Jadco
does not have any knowledge of any proposed increase therein and does not know
of any conditions or circumstances applicable to its business which might
result in such increase, except for those conditions generally applicable to
the industry in which Jadco is engaged in business. There are no material
claims, actions, suits or proceedings arising out of or based upon any of such
policies of insurance, and, to the knowledge of Jadco, no basis for any such
material claim, action, suit or proceeding exists. There are no notices of any
pending or threatened terminations or substantial premium increases with
respect to any of such policies, and Jadco is in compliance with all conditions
contained therein.
4.24 Disposal of Waste. Jadco has not disposed, spilled or
deposited at any time on any of the properties previously or currently owned or
leased by it, nor does it have any knowledge of such disposal, spill or deposit
on any of the properties currently owned or leased by it, any "Hazardous
Substance" in excess of the corresponding "Reportable Quantity" (as those terms
are defined in the Comprehensive Environmental Response compensation and
Liability Act, as amended ("CERCLA") or its state or local equivalent), oil or
petroleum in excess of 100 kilograms, or "Hazardous Waste" in any quantity (as
that term is defined in the Resource Conservation and Recovery Act, as amended,
or its state or local equivalent), or disposed, spilled or deposited any
Hazardous Substances, oil, petroleum, or Hazardous Waste (collectively,
"Materials"), the nature, amount, or concentration of which would enable the
United States Environmental Protection Agency or any state regulatory agency to
undertake or require the removal or remediation of such Materials.
4.25. Other Environmental Matters. As to all operations relating to
the Business: (a) Jadco has complied with all applicable federal, state and
local laws, regulations, rulings and guidelines (collectively referred to as
"Environmental Laws") in all material respects relating to any Materials used,
generated, managed, handled, treated, stored or disposed of at, or moved or
transported from, the sites where its business is conducted; (b) Jadco has not
received any notices that it has been designated as a "Potentially Responsible
Party," a "Responsible Party," (as those terms are defined, used or construed
pursuant to CERCLA or its state or local counterparts) or a defendant in any
action, suit or proceeding pursuant to any Environmental Law; (c) no Materials
have been delivered to any site listed by the United States Environmental
Protection Agency (i.e., CERCLA) or by any state as a site that actually or
potentially requires investigation or remedial action; (d) Jadco is not a party
to, has received notice of, or is aware of any actual or threatened litigation
or administrative proceedings concerning environmental claims or liabilities;
and (e) there are no environmental studies or reports in the possession or
control of Jadco.
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4.26 Compliance With Laws.
(a) Jadco is in full compliance with all laws, rules and
regulations applicable to or affecting it or the conduct of its business and
has secured all governmental licenses, permits and approvals necessary to its
business.
(b) Other than sales tax licensing and corporate
approvals to do business, no government licenses, permits or appraisals are
otherwise issued to or relied upon by Jadco to conduct its business.
4.27 Litigation. Except as set forth in Schedule 4.27, there is no
action, suit, arbitration, proceeding or investigation pending or threatened
against Jadco before any court or administrative agency, nor does Jadco know or
have any reason to know of any basis for any such action, proceeding or
investigation. Jadco has not received any opinion or memorandum or legal
advice or notice from legal counsel to the effect that it is likely, from a
legal standpoint, that it will incur any liability which may be material to its
business.
4.28 Full Disclosure; No Misrepresentation. Jadco has fully
provided Photocomm with all the information which Photocomm has requested for
deciding whether to enter into this Agreement. Neither this Agreement nor any
certificate or Schedule or other information furnished by or on behalf of Jadco
pursuant to this Agreement contains any untrue statement of a material fact or,
when this Agreement and such certificates, Schedules and other information are
taken in their entirety, omits to state a material fact necessary to make the
statements contained herein or therein not misleading.
5.0 REPRESENTATIONS AND WARRANTIES OF PHOTOCOMM. Photocomm
represents and warrants to Jadco as follows, and acknowledges and confirms that
Jadco is relying upon such representations and warranties in connection with
the execution, delivery and performance of this Agreement, notwithstanding any
investigation made by Jadco or on its behalf:
5.1. Organization and Standing. Photocomm is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Arizona, has all of the requisite corporate power and authority and has all of
the licenses, permits, authorities and consents that are necessary to own,
operate and lease its properties and to carry on its business as now being
conducted and as proposed to be conducted. Photocomm is duly qualified to do
business and is in good standing as a foreign corporation in all jurisdictions
in which the property owned, leased or operated by Photocomm or the nature of
the business conducted by Photocomm makes such qualification necessary.
Neither Photocomm nor any Subsidiary (as defined in Section 5.3) is a party to
or subject to any agreement, consent decree or order, or other understanding or
arrangement with, or any directive of, any governmental authority or other
person which imposes any restriction or otherwise affects in any material way
the conduct of their business in any jurisdiction or location. True and
accurate copies of Photocomm's Articles of Incorporation, as amended, and
By-laws, as presently in effect, are attached as Schedule 5.1 to this
Agreement.
5.2. Capitalization. (a) All issued and outstanding shares of
capital stock of Photocomm have been validly authorized and issued and are
fully paid and nonassessable. At Closing, the authorized capital of Photocomm
will consist solely of twenty five million
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(25,000,000) shares of Common Stock, of which, as of December 31, 1995,
13,540,709 shares were validly issued and outstanding, fully paid and
nonassessable, and five million (5,000,000) shares of Preferred Stock, of which
200,000 shares have been designated as Series AA (of which, as of December 31,
1995, 69,365 were validly issued and outstanding, fully paid and
nonassessable), 125,000 shares have been designated as Series A (of which, as
of December 31, 1995, 109,972 were validly issued and outstanding, fully paid
and nonassessable) and 350,000 shares have been designated as Series B (of
which, as of December 31, 1995, none were validly issued and outstanding). The
Board of Directors of Photocomm has duly authorized and reserved for issuance
2,895,000 shares of Common Stock pursuant to Photocomm's Employee Stock Option
Plan and 100,000 shares of Common Stock pursuant to Photocomm's Directors Stock
Option Plan. As of January 20, 1996, options for 1,752,375 shares of Common
Stock were outstanding pursuant to Photocomm's Employee Stock Option Plan and
options for 50,000 shares of Common Stock were outstanding pursuant to
Photocomm's Directors Stock Option Plan. Except for the Series AA, A and B
preferred stock, options to purchase up to 1,752,375 shares of Common Stock
pursuant to Photocomm's Employee Stock Option Plan, options to purchase up to
50,000 shares of Common Stock pursuant to Photocomm's Directors Stock Option
Plan, and an option issued to the New World Power Corporation to purchase up to
1,500,000 shares of Common Stock, there are no other options, warrants,
conversion privileges, preemptive rights, or other rights presently outstanding
for any capital stock.
(b) The conversion price or prices and conversion rate or rates at
which outstanding securities may be converted or exchanged into Common Stock
are shown on Schedule 5.2. Such conversion prices and rates are not subject to
adjustment as a result of any of the transactions contemplated by this
Agreement.
(c) The shares of Common Stock of Photocomm to be acquired by the
Buyer pursuant to this Agreement are not subject to any transfer restrictions
or limitations except as provided in section 6 of this Agreement.
5.3. Subsidiaries. Except for Balance of Systems Specialists,
Inc., an Arizona corporation, Photocomm of Texas, Inc., a Texas corporation and
Photocomm Credit Corporation, an Arizona corporation (each a "Subsidiary" and
together the "Subsidiaries"), Photocomm has no subsidiaries or affiliated
companies and does not otherwise presently own or control, directly or
indirectly, any other corporation, association, or other business entity. Each
Subsidiary is duly organized, validly existing and in good standing under the
laws of the state of its incorporation and is wholly owned by Photocomm. Each
Subsidiary is duly qualified to do business and is in good standing as a
foreign corporation in all jurisdictions in which the property owned, leased or
operated by the Subsidiary or the nature of the business conducted by the
Subsidiary makes such qualification necessary. Each Subsidiary has all the
requisite corporate power, authority, licenses and permits that are necessary
to own, operate and lease its properties and to carry on its business as now
being conducted.
5.4. Validity of Common Stock. The Photocomm Common Stock, when
issued, sold and delivered to Jadco in accordance with this Agreement for the
consideration expressed herein, will be validly issued, fully paid and
nonassessable and will be free and clear of all liens.
5.5 Authorization. Photocomm has all the requisite legal and
corporate power and authority to execute and deliver this Agreement and to
consummate the transactions
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contemplated hereby. All corporate action on the part of Photocomm and its
officers, directors and stockholders necessary for the authorization,
execution, delivery, and performance of all obligations of Photocomm under this
Agreement and for the authorization, issuance and delivery of the Common Stock
being issued and sold under this Agreement by Photocomm has been (or will be)
taken prior to the Closing. This Agreement, when executed and delivered, shall
constitute a legal, valid and binding obligation of Photocomm, enforceable in
accordance with its terms.
5.6 Governmental Consents. No consent, approval, order, or
authorization of, or registration, qualification, designation, declaration or
filing with, any federal, state or local governmental authority is required on
the part of Photocomm in connection with the execution, delivery or performance
of this Agreement or consummation of the transactions contemplated hereby.
Based in part upon the accuracy of the Buyer's representations and warranties
as set forth in Section 6.1, the sale and issuance of the Common Stock by
Photocomm in conformity with the terms of this Agreement is exempt from the
registration requirements of all applicable federal and state securities laws.
5.7 Compliance with Other Instruments. Neither Photocomm nor any
Subsidiary will be, as a result of the execution, delivery or performance of
this Agreement, in violation of or default under any provision of its Articles
of Incorporation or By-laws, as amended and in effect on date hereof, or of any
provision of any instrument, contract or lease to which it is a party, or of
any provision of any federal or state judgment, writ, decree, order, statute,
rule, or governmental regulation applicable to Photocomm or any Subsidiary.
5.8 Financial Statements. A consolidated audited balance sheet,
income statement and statement of cash flows as of and for each of the fiscal
years ending August 31, 1995 and August 31, 1994 (the "Photocomm Audited
Financials"), with related opinion of KPMG Peat Marwick, independent public
accountants, and a consolidated unaudited balance sheet, income statement and
statement of cash flows as of and for the period ending November 30, 1995 (the
"Photocomm Unaudited Financials"), are attached hereto as Schedule 5.8. The
Photocomm Audited Financials and the Photocomm Unaudited Financials are
hereinafter referred to collectively as the "Photocomm Financial Statements."
The Photocomm Audited Financials have been prepared in accordance with
generally accepted accounting principles consistently applied, are true and
correct and fairly present the financial position of Photocomm and its
Subsidiaries as of their respective dates and the results of their operations
for the periods then ended. The Photocomm Unaudited Financials have also been
prepared in accordance with generally accepted accounting principles
consistently applied and are true and correct and fairly present the financial
position of Photocomm and its Subsidiaries as of their respective dates and the
results of operations for the period then ended and contain all adjustments
(consisting of normal recurring accruals) considered necessary for a fair
presentation. Photocomm and its Subsidiaries have established and will
continue to maintain a standard system of accounting to be carried out and
administered in accordance with generally accepted accounting principles.
Except to the extent reflected or reserved against or disclosed in the
Photocomm Financial Statements, as of their respective dates, neither Photocomm
nor any Subsidiary has incurred any material liabilities or obligations of any
kind, whether accrued, absolute, contingent or otherwise, which under generally
accepted accounting
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principles should have been so reflected or reserved against or disclosed
(including, without limitation, all liabilities to vendors and customers of
Photocomm and its Subsidiaries).
5.9 Undisclosed Liabilities. Neither Photocomm nor any Subsidiary
has any liabilities or obligations, either absolute, accrued, contingent or
otherwise, which individually or in the aggregate are materially adverse to the
financial condition and business of Photocomm or its Subsidiaries, which (i)
have not been reflected in the Photocomm Financial Statements, (ii) have not
been described in this Agreement or in any of the Schedules hereto, or (iii)
have not been incurred in the ordinary course of business since November 30,
1995, consistent with past practices.
5.10 Changes. Except as set forth in Schedule 5.10, since November
30, 1995:
(a) Neither Photocomm nor any subsidiary has entered into any
transaction which was not in the ordinary course of business;
(b) There has been no adverse change in the condition (financial
or otherwise), business, property, assets or liabilities of Photocomm or any
Subsidiary other than changes in the ordinary course of business, none of
which, individually or in the aggregate, has been material;
(c) There has been no damage to, destruction of or loss of
physical property (whether or not covered by insurance) adverse to the business
or operations of Photocomm or any Subsidiary;
(d) Neither Photocomm nor any Subsidiary has declared or paid any
dividend or made any distribution on its stock, other than regularly scheduled
dividends on Photocomm's preferred stock;
(e) There has been no litigation or administrative agency charges
or proceedings commenced involving, relating to or affecting their business;
and
(k) There has been no other event or condition of any character
pertaining to and materially adverse to the assets or business of Photocomm
and its Subsidiaries.
5.11 Title to Properties and Assets; Liens, etc. The properties
and assets of Photocomm and its Subsidiaries, both real, personal and mixed,
tangible and intangible, necessary or useful to the operation of their business
are in good condition and repair, ordinary wear and tear excepted, and suitable
for the uses intended. The properties and assets are being maintained in a
state of good repair, and, in all respects, comply with and are operated in
conformity with all applicable laws, ordinances, regulations, orders, permits
and other requirements relating thereto adopted or currently in effect.
5.12 Taxes. Photocomm and its Subsidiaries have filed all federal,
state, county, local and foreign tax returns, reports and forms for income,
excise, social security, property, payroll, unemployment and other taxes which
are required to be filed by them, including all sales tax returns with respect
to direct sales made by Photocomm or its Subsidiaries ("Tax Returns").
Photocomm and its Subsidiaries have paid, or adequate provision has been made
on the
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Photocomm Financial Statements for the payment of, all federal, state, county,
local and foreign taxes, assessments, levies or duties, howsoever measured or
imposed, and related interest and penalties, if any (collectively, "Taxes").
No unexpired waiver of the applicable statute of limitations with respect to
any taxable year has been executed by Photocomm or its Subsidiaries. There are
no tax examinations or audits underway involving Photocomm or any Subsidiary.
5.13 Disposal of Waste. Neither Photocomm nor any Subsidiary has
disposed, spilled or deposited at any time on any of the properties previously
or currently owned or leased by them, nor do any of them have any knowledge of
such disposal, spill or deposit on any of the properties currently owned or
leased by it, any "Hazardous Substance" in excess of the corresponding
"Reportable Quantity" (as those terms are defined in the Comprehensive
Environmental Response compensation and Liability Act, as amended ("CERCLA") or
its state or local equivalent), oil or petroleum in excess of 100 kilograms, or
"Hazardous Waste" in any quantity (as that term is defined in the Resource
Conservation and Recovery Act, as amended, or its state or local equivalent),
or disposed, spilled or deposited any Hazardous Substances, oil, petroleum, or
Hazardous Waste (collectively, "Materials"), the nature, amount, or
concentration of which would enable the United States Environmental Protection
Agency or any state regulatory agency to undertake or require the removal or
remediation of such Materials.
5.14 Other Environmental Matters. As to all operations relating to
the business: (a) Photocomm and its Subsidiaries have complied with all
applicable federal, state and local laws, regulations, rulings and guidelines
(collectively referred to as "Environmental Laws") in all material respects
relating to any Materials used, generated, managed, handled, treated, stored or
disposed of at, or moved or transported from, the sites where the Business is
conducted; (b) neither Photocomm nor any Subsidiary has received any notices
that it has been designated as a "Potentially Responsible Party," a
"Responsible Party," (as those terms are defined, used or construed pursuant to
CERCLA or its state or local counterparts) or a defendant in any action, suit
or proceeding pursuant to any Environmental Law; (c) no Materials have been
delivered to any site listed by the United States Environmental Protection
Agency (i.e., CERCLA or NPL) or by any state as a site that actually or
potentially requires investigation or remedial action; (d) neither Photocomm
nor any Subsidiary is a party to, have received notice of, or is aware of any
actual or threatened litigation or administrative proceedings concerning
environmental claims or liabilities; and (e) there are no environmental studies
or reports in the possession or control of Photocomm or any Subsidiary.
5.15 Compliance With Laws.
(a) Photocomm and its Subsidiaries are in full compliance with all
laws, rules and regulations applicable to or affecting them or the conduct of
their business and have secured all governmental licenses, permits and
approvals necessary to their business.
(b) Other than sales tax licensing and corporate approvals to do
business, no government licenses, permits or appraisals are otherwise issued to
or relied upon by Photocomm or its Subsidiaries to conduct their business.
5.16 Filings. Photocomm has previously delivered to Jadco an
accurate and complete copy of each final registration statement, report and
definitive proxy statement, together with all amendments or supplements
required to be made with respect thereto, filed since August 31,
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1993 and prior to the date hereof by Photocomm with the Securities and Exchange
Commission (the "SEC") pursuant to the Securities Act of 1933, as amended, and
the Securities Exchange Act of 1934, as amended (collectively, the "Company
Reports"). Photocomm Reports (i) comply as to form with the requirements of
the Exchange Act, and the regulations promulgated thereunder; (ii) contain all
exhibits required to be included therein by the Exchange Act and the
regulations promulgated thereunder; and (iii) do not contain any misstatement
of a material fact or omit to state any material fact necessary, in light of
the circumstances under which they were made, to make such statements not
misleading.
5.17 Litigation. There is no action, suit, arbitration, proceeding
or investigation pending or threatened against Photocomm or any Subsidiary
before any court or administrative agency, nor does Photocomm, after due
investigation, know or have any reason to know of any basis for any such
action, proceeding or investigation. Neither Photocomm or its Subsidiaries
have received any opinion or memorandum or legal advice or notice from legal
counsel to the effect that it is likely, from a legal standpoint, that it will
incur any liability or disadvantage which may be material to their business.
5.18 Full Disclosure; No Misrepresentation. Photocomm has fully
provided Jadco with all the information which Jadco has requested for deciding
whether to enter into this Agreement and all information which Photocomm
believes is reasonably necessary to enable Jadco to make such decision.
Neither this Agreement nor any certificate or Schedule or other information
furnished by or on behalf of Photocomm pursuant to this Agreement contains any
untrue statement of a material fact or, when this Agreement and such
certificates, Schedules and other information are taken in their entirety,
omits to state a material fact necessary to make the statements contained
herein or therein not misleading.
6. PRIVATE PLACEMENT STATUS; REPRESENTATIONS AND WARRANTIES OF
JADCO AND ALLEN.
6.1 Jadco and Allen represent and warrant as follows and
acknowledge and confirm that Photocomm is relying upon such representations and
warranties in connection with the execution, delivery and performance of this
Agreement, notwithstanding any investigation made by Photocomm or on its
behalf:
(a) Jadco and Allen have such knowledge and experience in
financial and business matters, or have relied upon advisors who are so
qualified, that they are capable of evaluating the merits and risks of the
investment by them in Photocomm as contemplated by this Agreement and are able
to bear the economic risk of such investment for an indefinite period of time.
Jadco and Allen have been furnished access to such information and documents as
they have requested and have been afforded an opportunity to ask questions of
and receive answers from representatives of Photocomm concerning the business
and financial condition of Photocomm and the terms and conditions of this
Agreement and the issuance of securities contemplated hereby.
(b) Jadco is acquiring the Common Stock of Photocomm for
investment for its own account and not with a view to, or for resale in
connection with, any distribution, other than transfer of the Common Stock to
Allen in connection with the complete liquidation of Jadco. Jadco and Allen
understand that the Common Stock of Photocomm to be issued to Jadco hereunder
has not been registered under the Act by reason of a specific exemption from
the
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registration provisions of the Act which depends upon, among other things, the
accuracy of Jadco's and Allen's representations expressed herein.
(c) Jadco and Allen acknowledge that the Common Stock of Photocomm
must be held indefinitely and may not be sold or offered for sale in the
absence of an effective registration statement as to such securities under said
Act and any applicable state securities laws or an exemption from such
registration is available.
(d) Jadco and Allen have had an opportunity to discuss the
business, management and financial affairs of Photocomm and its Subsidiaries
with their management and an opportunity to review the facilities of Photocomm
and its Subsidiaries. Jadco and Allen understand that such discussions, as
well as the written information provided by Photocomm, were intended to
describe the aspects of Photocomm's business and prospects which it believes to
be material but were not necessarily a thorough or exhaustive description.
(e) Jadco and Allen are sophisticated investors with such
knowledge and experience in financial and business matters so as to be capable
of evaluating the merits and risks of a prospective investment in the Common
Stock of Photocomm and capable of bearing the economic risks of such
investment.
(f) Jadco and Allen, both by themselves and through their agents,
have been solely responsible for their "due diligence" investigation of
Photocomm and its management and business, for the analysis of the merits and
risks of an investment in the Common Stock of Photocomm; that in taking any
action or performing any role relative to the arranging of the investment, they
have acted solely in their interest, and that neither they nor any of their
agents or employees have acted as an agent of Photocomm or any subsidiary, or
as an issuer, underwriter, broker, dealer or investment advisor relative to the
Common Stock of Photocomm.
6.2. Legend. Each certificate representing the Common Stock of
Photocomm shall be endorsed with the following legend:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT") OR ANY OTHER SECURITIES
LAWS, AND MAY NOT BE SOLD, TRANSFERRED, ASSIGNED OR HYPOTHECATED UNLESS THERE
IS AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT AND OTHER APPLICABLE
SECURITIES LAWS COVERING SUCH SECURITIES, OR THE ISSUER RECEIVES AN OPINION OF
COUNSEL SATISFACTORY TO IT THAT ANOTHER EXEMPTION FROM REGISTRATION IS
AVAILABLE.
Photocomm shall not register a transfer of the Common Stock of Photocomm unless
the conditions specified in the foregoing legend are satisfied. Photocomm may
instruct its transfer agent not to register the transfer of any of such
securities, unless the conditions specified in the foregoing legend are
satisfied.
7.0 BULK SALES LAW. Photocomm agrees to waive compliance by Jadco
with the provisions of the Bulk Sales Law, and Jadco and Allen agree to
indemnify Photocomm against any loss, damage or expense, including reasonable
attorney's fees, incurred by Photocomm
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resulting from such noncompliance, provided Photocomm immediately notifies
Jadco and Allen upon any assertion of a claim and tender the defense of such
claim to Jadco and/or Allen.
8.0 PRE-CLOSING COVENANTS.
8.1 Access to Information; Confidentiality. (a) From the date
hereof to the Closing Date, Jadco will (i) afford to representatives of
Photocomm, including its counsel and auditors, during normal business hours,
access to any and all of the Assets and information with respect to the
business (except as respects certain proprietary and technical information
designated by Jadco) so that Photocomm may have a reasonable opportunity to
make such a full investigation of the Assets and of the business in advance of
the Closing Date as it shall reasonably desire, and (ii) cause the directors
and officers of Jadco to confer with representatives of Photocomm and will
furnish to Photocomm, either orally or by means of such records, documents, and
memoranda as are available or reasonably capable of preparation, such
information as Photocomm may reasonably request, and Jadco will furnish to
Photocomm's auditors all consents and authority that they may reasonably
request in connection with any examination of Jadco by Photocomm.
(b) Photocomm hereby acknowledges that some of the information to
be provided by Jadco has been designated as confidential and proprietary (the
"Confidential Information"). Photocomm hereby agrees that it will keep in
confidence all Confidential Information that has been or may be provided by
Jadco, and that Photocomm will use the same for the sole purpose of completing
its due diligence inquiry of Jadco. Photocomm hereby agrees not to disclose
the Confidential Information to any person except those of its employees and
advisors who have a reasonable need to know such information to advise
Photocomm in connection with the transactions contemplated hereby. This
Section 8.1(b) shall be inoperative as to such portions of Confidential
Information which (i) are or become generally available to the public, other
than as a result of a disclosure by Photocomm or its employees or advisors;
(ii) become available to Photocomm on a non-confidential basis from a third
party who has the right to disclose the same; or (iii) were known to Photocomm
on a non-confidential basis prior to its disclosure by Jadco or one of its
representatives.
8.2 Interim Operations of the Business. Jadco hereby covenants
and agrees that between the date hereof and the Closing Date:
(a) Jadco shall conduct its business diligently and in
the ordinary course and in accordance with past practice, and use its best
efforts to (i) preserve its business organization intact, and (ii) keep
available the services of its present employees.
(b) Jadco shall not mortgage or encumber any Asset.
(c) All Assets shall be used, operated, maintained and
repaired in accordance with normal and prudent business practices.
(d) Jadco shall use its best efforts to preserve Jadco's
relationships and goodwill with its customers, suppliers, licensors and others
having business relationships with Jadco.
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(e) Jadco shall (i) maintain all Assets in substantially
the same condition as they are now (reasonable wear and tear, which are not
such as to adversely affect the operation of its business, excepted), (ii)
maintain insurance upon the Assets and with respect to the conduct of the
business, all such insurance to be comparable in amount, scope and coverage to
that in effect on the date of this Agreement, and (iii) give Photocomm
immediate written notice of any material damage to Jadco's Assets by fire or
other casualty.
(f) Jadco shall maintain its books, records and accounts
in the usual, regular and ordinary manner, on a basis consistent with prior
periods, and shall not make any changes in the accounting methods or practices
followed by Jadco or any change in the depreciation or amortization policies or
rates theretofore adopted or applied.
(g) Jadco shall duly comply with all laws applicable to
it, the Assets and the conduct of its business.
(h) Jadco shall perform all of its obligations without
default.
(i) Jadco shall not grant any power of attorney with
respect to its business or the Assets.
(j) Without the prior written consent of Photocomm, Jadco
shall not enter into any new material contracts or agreements, or cancel,
amend, modify adversely, waive any material rights under, assign, encumber or
terminate any of its existing contracts or agreements.
(k) Jadco shall not (i) make any loan, or otherwise
extend credit to any person, firm or corporation, (ii) give any guarantee or
indemnity, or make any other similar commitment with respect to a debt or other
liability of any person, firm or corporation, or (iii) pay, discharge or
satisfy any liability for borrowed money other than such payment, discharge or
satisfaction in the ordinary and regular course of business.
(l) Jadco shall not, directly or indirectly, sell, lease
or otherwise dispose of any of the Assets or make any capital expenditures,
except in the ordinary course of business and consistent with the past
practices of Jadco, or acquire any other business.
(m) Jadco shall not increase the compensation payable or
to become payable to any employee, officer or director of Jadco.
(n) Jadco will not authorize or permit (i) the Articles
of Incorporation or By-Laws of Jadco to be amended, (ii) the merger,
consolidation or other combination of Jadco with any other entity, (iii) the
character of its business to be changed, (iv) Jadco to issue, sell or deliver,
or authorize the issuance, sale or delivery of, or redeem, any shares of any
class of its capital stock or any securities convertible into or exercisable or
exchangeable for any such shares, or any warrants, calls, options, stock
appreciation rights or other rights calling for the issuance, sale or delivery
of any such shares or convertible, exercisable or exchangeable securities, (v)
Jadco to pay any dividend or other distribution with respect to its capital
stock, other than regularly scheduled dividends consistent with past practices
or redeem or repurchase any of the capital stock, or (vi) Jadco to organize a
Subsidiary.
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(o) Jadco shall not write-down, cancel or forgive, in
full or in part, any accounts receivable of, or loans payable to Jadco, other
than in the ordinary course of business.
(p) Jadco will not engage in any transaction which would
be inconsistent with any representation, warranty or covenant of Jadco set
forth herein or which would cause a breach of any such representation, warranty
or covenant.
8.3. No Public Disclosure. The parties hereto hereby covenant and
agree that they shall not publicly disclose the existence of this Agreement or
the terms (including, without limiting the generality of the foregoing, the
Purchase Price) of the transactions contemplated by this Agreement and the
Additional Agreements except (i) with the prior written consent of the other
parties, (ii) if such disclosure is compelled by an order of a court or
governmental agency having competent jurisdiction, and after consultation by
the disclosing party with the other parties, (iii) if such disclosure shall be
determined by such party's counsel to be required or necessary for purposes of
such party's compliance with applicable stock exchange regulations or foreign,
federal or state securities laws and the rules and regulations promulgated
thereunder, and after consultation by such party with the other parties, (iv)
if such disclosure is required by lawful discovery in any judicial proceeding,
and after consultation by the disclosing party with the other parties, or (v)
in any action by any party to enforce this Agreement or any of the Additional
Agreements.
9.0 ADDITIONAL AGREEMENTS. At the Closing, the following
additional agreements (the "Additional Agreements") shall be executed and
delivered by the parties thereto as applicable:
9.1 Registration Rights Agreement. Jadco and Photocomm shall
enter into a Registration Rights Agreement substantially in the form of Exhibit
A attached hereto with respect to the shares of the Common Stock to be acquired
by Jadco from Photocomm.
9.2 Lease Agreement. Allen (and any other necessary parties as
lessors) and Photocomm shall enter into a Lease Agreement ("Lease") with
respect to the business premises presently used by Jadco as its primary
business premises in the form of Exhibit B attached hereto.
9.3. Employment Agreement. Allen and Photocomm shall enter into the
Employment Agreement attached hereto as Exhibit C.
9.4. Covenant Not to Compete. Allen and Photocomm shall enter into
the Non-Competition and Non-Disclosure Agreement attached hereto as Exhibits D.
10.0 AGREEMENT EXPENSES. Each of the parties shall bear its own
expenses in connection with the transactions covered or contemplated by this
Agreement, and each represents and warrants to the other that there is no
broker, agent or other person entitled to compensation or a fee in connection
with this Agreement or with the transactions contemplated hereby, except such
fees or compensations as each of the parties is hereby representing and
warranting that it is exclusively liable to pay.
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11. CONDITIONS PRECEDENT TO CLOSING.
11.1. Conditions to the Obligations of Photocomm. The performance
of the obligations of Photocomm hereunder is subject to the fulfillment, or
waiver by Photocomm, on or before the Closing Date of the following conditions:
(a) Authorization. All action necessary to authorize the
execution, delivery and performance of this Agreement and the Additional
Agreements by Photocomm and the consummation of the transactions contemplated
hereby and thereby shall have been duly and validly taken by Photocomm, and
Photocomm shall have full power and right to consummate the transactions
contemplated hereby and thereby.
(b) Conduct of Business in Ordinary Course. To the Closing Date,
Jadco shall have conducted its business only in the ordinary course, consistent
with the past practices of Jadco, the limitations of Section 8.2, and the other
covenants and representations made by Allen and Jadco herein, except for
actions expressly permitted by this Agreement, matters incident to carrying out
this Agreement, or such further matters as may be consented to in writing by
Photocomm. The Inventory and Tangible Personal Property of Jadco to be
acquired by Photocomm hereunder shall have an aggregate value of not less than
$700,000.
(c) Consents and Approvals. Jadco and Allen shall have obtained
all consents and approvals and waivers and given such notices as may be
necessary to consummate the transactions contemplated hereby and by the
Additional Agreements, including but not limited to (i) requisite stockholder
approval or notification and (ii) the consent to the transactions contemplated
hereby of the parties to all material agreements under which Jadco would
otherwise be in default as a result of the transactions contemplated hereby.
All consents, authorizations, orders or approvals of, and filings or
registrations with, any federal, state or local governmental commission, board
or other regulatory body which is required for or in connection with the
execution, delivery, and performance of this Agreement and the Additional
Agreements by Jadco and Allen and the consummation of the transactions
contemplated hereby shall have been obtained.
(d) No Litigation or Legislation. No federal, state, local or
foreign statute, rule or regulation shall have been enacted or litigation,
proceeding, government inquiry or investigation commenced or threatened which
prohibits, restricts or delays the consummation of the transactions
contemplated by this Agreement and by the Additional Agreements or any of the
conditions to the consummation of such transactions or adversely affects the
desirability of consummating the transactions contemplated hereby and thereby.
(e) Accuracy of Representations and Warranties. Each of the
representations and warranties of Jadco and Allen set forth in Sections 4 and 6
hereof shall be true and correct in all material respects on and as of the
Closing Date.
(f) Delivery of Closing Documents. Photocomm shall have received
the closing documents set forth in Section 13.1 hereof, including, but not
limited to, the Additional Agreements.
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(k) Due Diligence. Photocomm shall be satisfied in its sole
discretion with its due diligence inquiry of Jadco, its business, and the
Assets.
(l) Tax Returns. Jadco shall have timely filed with the proper
governmental agencies, and have provided Photocomm with true and complete
copies of, the federal, state and local income tax returns of Jadco for the
calendar year ending in December 31, 1994.
(m) No Adverse Change. There shall not have occurred a material
adverse change to Jadco, its business, or the Assets.
11.2. Conditions to the Obligations of Jadco. The performance of
the obligations of Jadco hereunder is subject to the fulfillment, or waiver by
Jadco, on or before the Closing Date of the following conditions:
(a) Authorization. All action necessary to authorize the
execution, delivery and performance of this Agreement and the Additional
Agreements by Jadco, and the consummation of the transactions contemplated
hereby and thereby, shall have been duly and validly taken by Jadco, and Jadco
shall have full power and right to consummate the transactions contemplated
hereby and thereby.
(b) Delivery of Closing Documents. Jadco shall have received the
closing documents set forth in Section 13.2 hereof.
(c) No Litigation or Legislation. No federal, state, local or
foreign statute, rule or regulation shall have been enacted or litigation,
proceeding, government inquiry or investigation commenced or threatened which
prohibits, restricts or delays the consummation of the transactions
contemplated by this Agreement and by the Additional Agreements or any of the
conditions to the consummation of such transactions or adversely affects the
desirability of consummating the transactions contemplated hereby and thereby.
(d) Accuracy of Representations and Warranties. Each of the
representations and warranties of Photocomm set forth in Section 5 hereof shall
be true and correct in all respects on and as of the Closing Date.
11.3. Option to Terminate. In the event any of the conditions
precedent to the obligation of any of the parties to consummate the
transactions contemplated hereby is not satisfied and/or waived on or before
the Closing Date, then any party whose obligation is subject to such conditions
shall have the right to terminate this Agreement by written notice to the other
parties. Upon the effective date of any termination made pursuant to this
Section 11.3, none of the parties to this Agreement shall have any further
liability or obligation to the other parties hereunder, unless otherwise
specifically stated.
12. CLOSING. The closing ("Closing") shall occur at the offices
of Bryce & Angle, P.L.C., 605 Main Street, Safford, Arizona 85546, at 2:00 p.m.
on January 31, 1996, or such other time as the parties mutually agree (the
"Closing Date"). The Closing shall constitute the acts which take place on the
Closing Date by which the transactions contemplated by this Agreement are
consummated.
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13. CLOSING DOCUMENTS. On the Closing Date, the parties shall
exchange documents as follows:
13.1. Delivery by Jadco. Jadco shall deliver to Photocomm:
(a) A copy of the resolutions duly adopted by the Board of
Directors and shareholders of Jadco authorizing and approving the execution,
delivery and performance of this Agreement and the applicable Additional
Agreements, and the execution and delivery of any and all other documents and
agreements contemplated hereunder and thereunder, certified by the Secretary or
an Assistant Secretary of Jadco.
(b) A certificate signed by Jadco to the effect that Jadco has
fully performed all of its pre-closing commitments hereunder and that all its
warranties and representations contained herein continue to be true and
accurate as of the Closing Date.
(c) The opinion of counsel to Jadco dated as of the Closing Date
to Photocomm to the following effect:
(1) Jadco is a corporation duly organized, validly existing and in
good standing under the laws of the State of Arizona, and is entitled
to own its properties and to carry on its business in the places where
such properties are located and where such business is being
conducted.
(2) The execution, delivery and performance of this Agreement have
been duly authorized by all necessary corporate action of Jadco and
this Agreement has been duly executed and delivered by Jadco and
constitutes a valid and binding obligation of Jadco in accordance with
its terms, except as the same may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws now or
hereafter in effect relating to creditor's rights and the remedies of
specific performance and injunction and other forms of equitable
relief which may be subject to equitable defenses and to the
discretion of the court before which any proceeding therefor may be
brought. No further corporate authorization or by any other person is
necessary with respect to the execution and delivery of this Agreement
by Jadco or its obligations hereunder.
(3) To the best of said counsel's knowledge Jadco has the right to
transfer the business, properties and assets as set forth in paragraph
1.0 hereof to Photocomm pursuant hereto.
(4) Except as may be specified by such counsel, they do not know
of any litigation, proceeding or governmental investigation pending or
threatened against, or relating to, Jadco or Jadco's properties or
business or the transactions contemplated under this Agreement.
(d) The Assets to be conveyed pursuant hereto shall be conveyed by
bills of sale, assignments or other instruments of transfer as shall be
appropriate to carry out the intent of this
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Agreement and as shall be sufficient to convey to Photocomm all of the rights,
title and interest of Jadco in and to the Assets to be conveyed hereunder.
(e) A copy of the Articles of Incorporation and the By-Laws of
Jadco, as amended to the Closing Date, certified by the Secretary or an
Assistant Secretary of Jadco.
(f) A Certificate of Good Standing as of a recent date issued by
the Corporation Commission of the State of Arizona to the effect that Jadco is
in good standing under the laws of that state.
(g) The Additional Agreements.
(h) Such further instruments or documents as Photocomm or its
counsel may reasonably request to assure the effective carrying out of the
transactions contemplated hereby.
13.2. Delivery by Photocomm. Photocomm shall deliver to Jadco:
(a) A copy of the resolutions duly adopted by the Board of
Directors of Photocomm authorizing and approving the execution, delivery and
performance of this Agreement and the applicable Additional Agreements, and the
execution and delivery of any and all other documents and agreements
contemplated hereunder and thereunder, certified by the Secretary or an
Assistant Secretary of Photocomm.
(b) A stock certificate representing 560,000 shares of Photocomm
Common Stock, $0.10 per share, issued in the name of Jadco. The stock
certificate shall contain a restrictive legend to the effect that the shares
represented by said certificate have not been registered under either the
federal or state securities laws and are not transferable except pursuant to an
exemption from said securities laws or subsequent registration of said shares.
(c) A certificate signed by an authorized officer of Photocomm to
the effect that Photocomm has fully performed all of its pre closing
commitments hereunder and that all of its warranties and representations
contained herein continues to be true and correct as of the Closing Date.
(d) The opinion of counsel to Photocomm dated as of the Closing
Date to Jadco to the following effect:
(1) Photocomm is a corporation duly organized, validly existing
and in good standing under the laws of the State of Arizona, and is
entitled to own its properties and to carry on its business in the
places where such properties are located and where such business is
being conducted.
(2) The execution, delivery and performance of this Agreement have
been duly authorized by all necessary corporate action of Photocomm
and this Agreement has been duly executed and delivered by Photocomm
and constitutes a valid and binding obligation of Photocomm in
accordance with its terms, except as the same may be limited
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by bankruptcy, insolvency, reorganization, moratorium or other similar
laws now or hereafter in effect relating to creditor's rights and the
remedies of specific performance and injunction and other forms of
equitable relief which may be subject to equitable defenses and to the
discretion of the court before which any proceeding therefor may be
brought. No further corporate authorization or by any other person is
necessary with respect to the execution and delivery of this Agreement
by Photocomm or its obligations hereunder.
(3) Except as may be specified by such counsel, they do not know
of any litigation, proceeding or governmental investigation pending or
threatened against, or relating to, Photocomm or Photocomm's
properties or business or the transactions contemplated under this
Agreement.
(4) The shares of Photocomm Common Stock to be issued to Jadco,
when issued, shall be fully paid, non assessable, and validly issued.
(e) A Certificate of Good Standing as of a recent date issued by
the Corporation Commission of the State of Arizona to the effect that Photocomm
is in good standing under the laws of that state.
(f) The Additional Agreements.
(g) Such further instruments or other documents as Jadco or its
counsel may reasonably request to assure the effective carrying out of the
transactions contemplated hereby.
13.3. Form of Closing Documents. All closing documents shall be in
form and substance reasonably satisfactory to counsel for the respective
parties.
13.4 Additional Documents. The parties further agree that at any
time subsequent to the date hereof, they will, upon request and at the expense
of the requesting party, do, execute, acknowledge and deliver, or cause to be
done, executed, acknowledged and delivered, all such further acts, assignments,
transfers, conveyances, powers of attorney or assurances as may be required for
the better assigning, transferring, granting, conveying and assuring to the
parties any of the properties and assets to be conveyed pursuant hereto.
14.0 POST CLOSING COVENANTS OF JADCO AND ALLEN.
14.1 Volume Limitation of Resale of Photocomm Common Stock.
Notwithstanding anything contained herein or in the Registration Rights
Agreement attached hereto as Exhibit A to the contrary, neither Jadco or Allen
shall, without the prior written consent of Photocomm, which consent may be
withheld in Photocomm's sole discretion, sell, transfer, assign, or convey,
except in a non-public sale, more than 150,000 shares of Photocomm Common Stock
in any ninety (90) day period.
14.2 Right of First Refusal in Favor of Photocomm. Photocomm shall
have, and Jadco and Allen hereby grant to Photocomm, a right of first refusal
to purchase all or any portion of
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the Common Stock of Photocomm to be issued to Jadco pursuant to this Agreement
("Common Stock") that Jadco or Allen (as Jadco's successor to the Common Stock)
may, from time to time, propose to sell to a party not affiliated with Jadco.
In the event that Jadco or Allen receives a bona fide offer to sell any of
their Common Stock, they shall deliver to Photocomm a written notice setting
forth the Specified Terms of such sale. Such notice shall constitute an
irrevocable Offer to Sell. Photocomm shall have ten (10) days after its
receipt of an Offer to Sell within which to notify Jadco or Allen, as the case
may be, in writing of Photocomm's election to purchase in accordance with the
Specified Terms all or a portion of the shares of Common Stock offered.
Photocomm's election to purchase shall be irrevocable and shall be binding upon
Jadco or Allen, as the case may be. Within twenty (20) days of receiving
Photocomm's election, Jadco or Allen, as the case may be, shall deliver to
Photocomm, against receipt from Photocomm of a certified or bank cashier's
check in the amount of the purchase price therefor (or, at Photocomm's option,
such other form of payment as provided in the Specified Terms), a certificate
or certificates or other instruments representing the shares of Common Stock
Photocomm has elected to purchase, properly endorsed for transfer and with all
necessary transfer and documentary stamps, if any, affixed or stock transfer
taxes, if any, paid. Jadco or Allen shall make such representations and
warranties as required by the Specified Terms in connection with such sale. In
the event Photocomm fails to exercise its right of first refusal within said
period, or exercises such right only with respect to a portion of the Common
Stock included in the Offer to Sell, Jadco or Allen, as the case may be, shall
have one hundred twenty (120) days thereafter to sell upon the Specified Terms
the shares of Common Stock respecting which Photocomm's rights were not
exercised to the designated offeree on the Specified Terms. In the event that
the shares of Common Stock have not been sold to the designated offeree on the
Specified Terms within said 120-day period, the shares shall not thereafter be
sold without first offering them to Photocomm in the manner provided above.
14.3 Survival. The obligations set forth in this Section 14 shall
survive the Closing.
15.0 INDEMNIFICATION.
15.1 Jadco and Allen. Jadco and Allen agree to and do hereby
indemnify, and hold harmless Photocomm, its directors, officers, employees and
agents, against and in respect to any claims, losses, expenses, obligations and
liabilities, including reasonable attorney's fees, which arise or result from
or relate to any breach of or failure by Jadco or Allen to perform any of their
warranties, representations, guarantees, commitments, covenants, or conditions
under this Agreement. Jadco and Allen shall remain liable for all claims,
liabilities, debts, defaults and obligations, whether or not known, which are
not expressly assumed hereunder by Photocomm and Jadco and Allen shall defend
at their entire expense, including reasonable attorney's fees and other costs
of litigation, and indemnify and hold harmless Photocomm against any and all
such claims, debts, defaults, obligations, liabilities or suits.
15.2 Photocomm. Photocomm agrees to and hereby indemnifies and
holds harmless Allen and Jadco, its officers, directors, employees and agents,
against and in respect to any claims, losses, expenses, costs, obligations and
liabilities, including reasonable attorney's fees, which Jadco or Allen may
incur or suffer by reason of a breach of or failure by Photocomm to perform any
of its warranties, representations, guarantees, commitments or covenants in
this
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Agreement, or by reason of any act or omission of Photocomm subsequent to the
Closing Date which constitutes a breach or default hereunder.
16. BENEFITS OF THIS AGREEMENT. Nothing in this Agreement shall
be construed to give any benefits to any person (including, without limiting
the generality of the foregoing, any present or former employee of Jadco) or
corporation or other entity, other than Allen, Jadco, and Photocomm, and this
Agreement shall be for the sole and exclusive benefit of Allen, Jadco, and
Photocomm.
17. SUCCESSORS AND ASSIGNS. This Agreement shall inure to the
benefit of, and be binding upon, the successors, heirs, executors,
administrators and permitted assigns of the parties hereto. This Agreement may
not be assigned by any of the parties hereto without the prior written consent
of the other parties.
18. NOTICES. Any notice from one party to the other shall be
deemed given when delivered to, or on the day after being sent by a nationally
recognized overnight courier service addressed to, the person at the address
listed below or to such other person and/or address as may be designated from
time to time in writing:
(a) if to Jadco or Allen:
P.O. Box 308
Safford, Arizona 85548
with a copy to:
Mark S. Bryce, Esq.
Bryce, Angle & Holt, PLC
605 Main Street
Safford, Arizona 85546
(b) if to Photocomm:
Photocomm, Inc.
7681 East Gray Road
Scottsdale, Arizona 85260
Attn: Robert R. Kauffman, President
with a copy to:
Steven P. Oman, Esq.
Oman, Schulenburg & Politan, P.L.C.
4801 East Greenway Road
Scottsdale, Arizona 85254
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19. SEVERABILITY. In the event any covenant, condition or other
provision of this Agreement is held to be invalid or unenforceable by a final
judgment of a court of competent jurisdiction, then such covenant, condition or
other provision shall be automatically terminated and performance thereof
waived, and such invalidity or unenforceability shall in no way affect any of
the other covenants, conditions or provisions hereof, and the parties hereto
shall negotiate in good faith to agree to such amendments, modifications or
supplements of or to this Agreement or such other appropriate actions as, to
the maximum extent practicable, shall implement and give effect to the
intentions of the parties as reflected herein.
20. ENTIRE AGREEMENT. This Agreement and the Additional
Agreements contain all of the terms agreed upon by the parties with respect to
the subject matter hereof and thereof and there are no representations or
understandings between the parties except as provided herein and therein. This
Agreement may not be amended or modified in any way except by a written
amendment to this Agreement duly executed by the parties.
21. WAIVER. No waiver of a breach of, or default under, any
provision of this Agreement shall be deemed a waiver of such provision or of
any subsequent breach or default of the same or similar nature or of any other
provision or condition of this Agreement.
22. APPLICABLE LAW. This Agreement shall be governed by and
construed (both as to validity and performance) and enforced in accordance with
the laws of the State of Arizona.
23. ATTORNEYS' FEES. In any action brought to enforce the
provisions of this Agreement, the prevailing party shall be entitled to recover
its attorneys' fees and costs as determined by the court and not the jury.
24. EQUITABLE RELIEF. The parties agree that the remedies at law
for any breach of the terms of this Agreement are inadequate. Accordingly, the
parties consent and agree that an injunction may be issued to restrain any
breach or alleged breach of such provisions. The parties agree that terms of
this Agreement shall be enforceable by a decree of specific performance. Such
remedies shall be cumulative and not exclusive, and shall be in addition to any
other remedies which the parties may have at law or in equity.
25. COUNTERPARTS. This Agreement may be executed in any number of
counterparts with the same effect as if the signatures thereto and hereto were
upon the same instrument, but all of such counterparts taken together shall be
deemed to constitute one and the same instrument. No party shall be bound
until each party has signed at least one (1) such counterpart.
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IN WITNESS WHEREOF, the parties have caused this Agreement to be executed in
their respective names as of the day and year first above written.
JADCO MANUFACTURING, INC.
an Arizona corporation
By: /s/ James C. Allen
------------------------
James C. Allen
President
/s/ James C. Allen
- ---------------------------
JAMES C. ALLEN
PHOTOCOMM, INC.
an Arizona corporation
By: /s/ Robert R. Kauffman
------------------------
Robert R. Kauffman
Chief Executive Officer
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EXHIBIT A
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (this "Agreement") is made and
entered into as of the 31st day of January, 1996, by and between PHOTOCOMM,
INC. an Arizona corporation with offices at 7681 East Gray Road, Scottsdale,
Arizona 85260 (the "Company"), and JADCO MANUFACTURING, INC., an Arizona
corporation with offices at 325 E. Main, Safford, Arizona 85546 ("Jadco," being
sometimes referred to herein as "Purchaser").
W I T N E S S E T H:
This Agreement is made with reference to the following facts.
A. The Company is issuing 560,000 shares of its common stock,
$0.10 par value (the "Common Stock") to the Purchaser pursuant to that certain
Agreement and Plan of Reorganization, dated January 31, 1996, by and among,
inter alia, the Company and the Purchaser (the "Agreement").
B. The Purchaser has requested, and the Company is willing to
provide, certain registration rights with respect to the shares of Common Stock
to be issued to the Purchaser.
NOW THEREFORE, in consideration of the premises and mutual covenants
herein contained, the parties agree as follows:
1. DEFINITIONS. As used herein:
(a) The term "Act" shall mean the Securities Act of 1933, as
amended.
(b) The terms "register," "registered" and "registration" refer to
a registration effected by preparing and filing an S-3 registration statement
in compliance with the Act and the declaration or ordering of the effectiveness
of such registration statement.
(c) The term "Registrable Securities" means (i) all of the shares
of Common Stock issued to or purchased by the Purchaser pursuant to the
Agreement, and (ii) any Common Stock issued or issuable upon the conversion or
exercise of any warrant, right or other security which is issued as a dividend
or other distribution with respect to, or in exchange for or in replacement of,
such Common Stock, excluding in all cases, however, any Registrable Securities
sold by a person in a transaction in which his or her rights under this
Agreement are not assigned or assignable; provided, however, that shares of
Common Stock or other securities shall only be treated as Registrable
Securities if and so long as they have not been sold to or through a broker or
dealer or underwriter in a public distribution or a public securities
transaction.
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(c) The term "Other Shareholders" means the holders of securities
of the Company who are entitled to have shares of the Common Stock included in
a registration of the Company's securities other than the Holders with respect
to the Registrable Securities.
(d) The term "Holder" means the Purchaser and any other holder of
Registrable Securities to whom the registration rights have been transferred
pursuant to Section 9 hereof.
(e) The term "Initiating Holders" means any Holder or Holders of
not less than fifty percent (50%) of the then outstanding Registrable
Securities.
(f) The term "SEC" means the Securities and Exchange commission or
any successor agency thereto.
(g) The term "1934 Act" means the Securities Exchange Act of 1934,
as amended.
2. REQUESTED REGISTRATION.
(a) The Initiating Holders shall be entitled to submit pursuant to
this Section 2 a written request for registration. Upon receipt by the Company
from the Initiating Holders, at any time after the six-month anniversary and
prior to the second annual anniversary of the Closing Date of the Agreement, of
a written request that the Company effect any registration, qualification or
compliance with respect to the Registrable Securities, the Company will:
(i) give written notice of the proposed registration,
qualification or compliance to all other Holders within ten (10) days
after receipt thereof; and
(ii) use its best reasonable efforts to effect an S-3 registration
(as well as qualification under the applicable blue sky or other state
securities laws, and appropriate compliance with exemptive regulations
issued under the Act and any other governmental requirements or
regulations) as may be so requested and as would permit or facilitate
the sale and distribution of all or such portion of the Registrable
Securities as are specified in such request, together with all or such
portion of the Registrable Securities of any Holder or Holders joining
in such request as are specified in a written request received by the
Company within thirty (30) days after such written notice is given;
provided, that the Company shall not be obligated to take any action
to effect any such registration, qualification or compliance pursuant
to this Section 2:
(A) In any particular jurisdiction in which the Company
would be required to execute a general consent to service of
process (unless the Company is already subject to service of
process under said state's securities laws), to register as a
dealer, or to cause any officer or employee of the Company to
register as a salesman in effecting such registration,
qualification or compliance;
(B) After the Company has effected one (1) such
registration pursuant to this Section 2;
(C) If the Company shall furnish to such Holders a
certificate signed by the Chief Executive Officer of the
Company stating that in the good faith judgment
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of the Board of Directors it would be seriously detrimental to
the Company or its stockholders for a registration statement
to be filed in the near future, then the Company's obligation
to use its best efforts to register, qualify or comply under
this Section 2 shall be deferred for a period not to exceed
180 days from the date of receipt of written request from the
Initiating Holders; provided, however, that the Company may
not utilize this right more than once in any twelve-month
period; or
(D) Within one hundred twenty (120) days of the effective
date of any other registration effected by the Company, or
prior to the effective date of such registration statement if
the Company shall have theretofore or thereafter given written
notice of such registration statement to the Holders of
Registrable Securities and shall have thereafter pursued the
preparation, filing and effectiveness of such registration
statement with diligence.
3. EXPENSES OF REGISTRATION. All expenses incurred in connection
with any registration, qualification or compliance pursuant to Section 2 of
this Agreement, including without limitation, all registration, filing and
qualification fees, printing expenses, escrow fees, fees and disbursements of
counsel for the Company, accounting fees and expenses, and expenses of any
special audits incidental to or required by such registration, shall be borne
by selling Holder, up to the aggregate amount of $20,000 and by the Company
thereafter; provided, however, that the Company shall not be required to pay
underwriters' fees, discounts or commissions relating to Registrable
Securities, or any fees for counsel to the selling Holders; and provided
further, that the Company shall not be required to pay for any expenses of any
registration proceeding begun pursuant to Section 2 hereof if the registration
request is subsequently withdrawn at the request of the Holders.
4. REGISTRATION PROCEDURES. If and whenever the Company is
required by the provisions of this Agreement to use its best efforts to effect
the registration of any Registrable Securities under the Act, the Company will,
as expeditiously as possible:
(a) Prepare and file with the SEC an S-3 registration statement
with respect to such securities and use its best efforts to cause such
registration statement to become and remain effective for such period as may be
necessary to permit the successful marketing of such securities but not
exceeding one hundred twenty (120) days or until the Holder or Holders have
completed the distribution described in the registration statement relating
thereto, whichever first occurs (unless the Holder is restricted by the Company
with respect to the number of shares which can be sold in any ninety (90) day
period pursuant to the Agreement, in which event the Company shall cause the
registration statement to remain effective until all shares owned by such
Holder which such Holder desires to sell are sold).
(b) Furnish to each Holder participating in the registration such
number of prospectuses and preliminary prospectuses in conformity with the
requirements of the Act, and such other documents as such Holder may reasonably
request in order to facilitate the public sale or other disposition of the
Registrable Securities being sold by such Holder.
(c) Notify each Holder of Registrable Securities covered by such
registration statement at any time when a prospectus relating thereto is
required to be delivered under the Act of the
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happening of any event as a result of which the prospectus included in such
registration statement, as then in effect, includes an untrue statement of a
material fact or omits to state a material fact required to be stated therein
or necessary to make the statements therein not misleading in the light of the
circumstances then existing.
5. INDEMNIFICATION.
(a) The Company agrees to indemnify and hold harmless each Holder
of Registrable Securities with respect to which a registration statement has
been filed under the Act pursuant to this Agreement, each of such Holder's
partners, officers and directors, and each person, if any, who controls any
such Holder within the meaning of the Act or the 1934 Act, as follows:
(i) against any and all loss, liability, claim (joint or several),
damage and expense whatsoever arising out of any untrue statement or
alleged untrue statement of a material fact contained in such
registration statement (or any amendment thereto), or the omission or
alleged omission therefrom of a material fact required to be stated
therein or necessary to make the statements therein not misleading, or
arising out of any untrue statement or alleged untrue statement of a
material fact contained in any preliminary prospectus or prospectus
(or any amendment or supplement thereto), or the omission or alleged
omission therefrom of a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they
were made, not misleading, unless such untrue statement or omission or
such alleged untrue statement or omission was made in reliance upon
and in strict conformity with written information furnished to the
Company by any Holder expressly for use in such registration statement
(or any amendment thereto) or such preliminary prospectus or
prospectus (or any amendment or supplement thereto), any violation or
alleged violation by the Company of the Act, the 1934 Act, any state
securities law or any rule or regulation promulgated under the Act,
the 1934 Act or any state securities law;
(ii) against any and all loss, liability, claim, damage and
expense whatsoever to the extent of the aggregate amount paid in
settlement of any litigation, commenced or threatened, or of any claim
whatsoever based upon any such untrue statement or omission or any
such alleged untrue statement or omission, if such settlement is
effected with the written consent of the Company; and
(iii) against any and all legal or other expense reasonably
incurred in investigating, preparing or defending against any
litigation, commenced or threatened, or any claim based upon any such
untrue statement or omission, or any such alleged untrue statement or
omission, to the extent that any such expense is not paid under clause
(i) or (ii) above, which expenses under this clause (iii) shall be
paid by the Company as incurred;
provided, however, that the foregoing indemnity agreement is subject to the
condition that, insofar as it relates to any such untrue statement, alleged
untrue statement, omission or alleged omission made in a preliminary prospectus
but eliminated or remedied in the amended prospectus on file with the SEC at
the time the registration statement becomes effective, or in the amended
prospectus filed with the SEC pursuant to Rule 424(b) (the "Final Prospectus"),
such indemnity agreement shall not inure to the benefit of any Holder or other
indemnitee, if a copy
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<PAGE> 36
of the Final Prospectus was not furnished to the person or entity asserting the
loss, liability, claim or damage at or prior to the time such action is
required by the Act.
In no case shall the Company be liable under this indemnity agreement
with respect to any loss, liability, claim, damage or expense with respect to
any claim made against any Holder or other indemnitee unless the Company shall
be notified in writing of the nature of the claim within a reasonable time
after the assertion thereof, if prejudicial to its ability to defend such
action, but failure to so notify the Company shall not relieve the Company from
any liability which it may have otherwise than on account of this indemnity
agreement. In case of any such notice, the Company shall be entitled to
participate at its expense in the defense, or if it so elects within a
reasonable time after receipt of such notice, to assume the defense of any suit
brought to enforce any such claim; but if it so elects to assume the defense,
such defense shall be conducted by counsel chosen by it and approved by the
Holder and other defendant or defendants, if any, in any suit so brought, which
approval shall not be unreasonably withheld. In the event that the Company
elects to assume the defense of any such suit and retain such counsel, the
Holder and other defendant or defendants which may be represented without
conflict by one counsel, shall have the right to retain one separate counsel,
with the fees and expenses to be paid by the Company, but only if
representation of such Holder and other defendant or defendants by the counsel
retained by the Company would be inappropriate due to actual or potential
differing interests between such indemnified party and any other party
represented by such counsel in such proceeding.
(b) Each Holder severally agrees that it will indemnify and hold
harmless the Company, each officer and director of the Company, each person, if
any, who controls the Company within the meaning of the Act, the Company's
attorneys and accountants, each underwriter of Registrable Securities included
in any registration statement which has been filed under the Act pursuant to
this Agreement, each person, if any, who controls such underwriter, within the
meaning of the Act, each other Holder, each of such other Holder's partners,
officers and directors, and each person controlling such other Holder within
the meaning of the Act against any and all loss, liability, claim, damage and
expense described in clauses (a)(i) through (a)(iii), inclusive, of this
Section 5, but only with respect to statements or omissions, or alleged
statements or omissions made in any registration statement (or any amendment
thereto) or any preliminary prospectus or prospectus (or any amendment or
supplement thereto) in reliance upon and in strict conformity with written
information furnished to the Company by such Holder expressly for use in such
registration statement (or any amendment thereto) or such preliminary
prospectus or prospectus (or any amendment or supplement thereto) and only to
the extent of proceeds received by such Holder from the sale of its Registrable
Securities in the offering as to which the registration statement relates;
provided, however, that the foregoing indemnity agreement is subject to the
condition that, insofar as it relates to any such untrue statement, alleged
untrue statement, omission or alleged omission made in a preliminary prospectus
but eliminated or remedied in the amended prospectus on file with the SEC at
the time the registration statement becomes effective, or in the amended
prospectus filed with the SEC pursuant to Rule 424(b) (the "Final Prospectus"),
such indemnity agreement shall not inure to the benefit of any person entitled
to be indemnified pursuant to this Section (b), if a copy of the Final
Prospectus was not furnished to the person or entity asserting the loss,
liability, claim or damage at or prior to the time such action is required by
the Act. In case any action shall be brought against the Company or any person
so indemnified pursuant to the provisions of this Section (b) and in respect of
which indemnity may be sought against any Holder, the Holders
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<PAGE> 37
from whom indemnity is sought shall have the rights and duties given to the
Company, and the Company and the other persons so indemnified shall have the
rights and duties given to the persons entitled to indemnification by the
provisions of Section (a) of this Section 5.
6. INFORMATION BY HOLDER. The Holder or Holders of Registrable
Securities included in any registration shall furnish to the Company such
information regarding such Holder or Holders, and the distribution proposed by
such Holder or Holders, as the Company may request in writing and as shall be
required in connection with any registration, qualification or compliance
referred to in this Section
7. SALE WITHOUT REGISTRATION. If at the time of any transfer
(other than a transfer not involving a change in beneficial ownership) of any
Registrable Securities, such Registrable Securities shall not be registered
under the Act, the Company may require, as a condition of allowing such
transfer, that the Holder or transferee furnish to the Company (a) such
information as is necessary in order to establish that such transfer may be
made without registration under the Act, and (b) (if the transfer is not made
in compliance with Regulation S or Rule 144A) at the expense of the Holder or
transferee, an opinion of counsel satisfactory to the Company in form and
substance to the effect that such transfer may be made without registration
under the Act; provided that nothing contained in this Section 7 shall relieve
the Company from complying with any request for registration, qualification, or
compliance made pursuant to the other provisions of this Agreement.
8. ELIGIBILITY FOR FORM S-3 AND RULE 144. The Company represents
and warrants to the Holder, its successors and assigns, that it meets the
eligibility requirements of Form S-3 under the Act to register secondary
offerings of its Common Stock and agrees that it shall continue to meet such
requirements so long as the Holder has demand registration rights under this
agreement. With a view to making available to the Holders the benefits of
certain other rules and regulations of the SEC which may permit the sale of the
Registrable Securities to the public without registration, the Company agrees
to use its best efforts to:
(a) Make and keep public information available, as those terms are
understood and defined in Rule 144;
(b) File with the SEC in a timely manner all reports and other
documents required of the Company under the Act and the Securities Exchange Act
of 1934; and
(c) Furnish the Holders forthwith upon request (i) a written
statement by the Company as to its compliance with the public information
requirements of said Rule 144 or that it qualifies as a registrant whose
securities may be resold pursuant to Form S-3, (ii) a copy of the most recent
annual or quarterly report of the Company, and (iii) such other reports and
documents as may be reasonably requested in availing the Holders of any rule or
regulation of the SEC permitting the sale of any such securities without
registration.
9. TRANSFER OF REGISTRATION RIGHTS. The rights to cause the
Company to register securities granted by the Company under Section 2 hereof
may be assigned in writing by the Purchaser to its shareholders upon the
liquidation of Purchaser as contemplated in the Agreement and upon transfer of
the Registrable Securities to such shareholders (or any family trust controlled
by them); provided, that such transfer may otherwise be effected in accordance
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with applicable securities laws; and provided further, that the Company is
given written notice by such holder of shares of the Common Stock at the time
of or within a reasonable time after said transfer, stating the name and
address of said transferee or assignee and identifying the securities with
respect to which such registration rights are being assigned. No other
transfer of the Registration Rights shall be allowed.
10. REGISTRATION BY COMPANY. If at any time the Company proposes
to issue common stock pursuant to a registration under the Act, or register its
common stock pursuant to the request of Other Shareholders, the Company will
give prompt written notice to each Holder of its intention to effect such a
registration and, subject to the limitations, conditions and indemnities
contained herein, will include in such registration (and related qualification
under blue sky laws or other compliance) those shares of Registrable Securities
for which the Company has received a written request for inclusion within
twenty (20) business days after receipt by each Holder of the Company's notice.
Each participating Holder agrees to pay the additional registration expenses
allocable to the inclusion of such Holder's Registrable Securities on a pro
rata basis, provided, however, the aggregate amount allocable to all of the
Holders shall not exceed $20,000.
11. SUCCESSORS. All the covenants and provisions of this
Agreement by or for the benefit of the Company and the Initiating Holders shall
inure to the benefit of their respective successors and assigns hereunder.
12. NOTICES. Any notice from one party to the other shall be
deemed given when delivered to, or on the day after being sent by a nationally
recognized overnight courier service addressed to, the person at the address
listed below or to such other person and/or address as may be designated from
time to time in writing:
(a) if to the Company:
Photocomm, Inc.
7681 E. Gray Road
Scottsdale, AZ 85260
with a copy to:
Steven P. Oman, Esq.
Oman, Schulenburg & Politan, P.L.C.
4801 East Greenway Road
Scottsdale, Arizona 85254
(b) if to Jadco:
Jadco Manufacturing, Inc.
P.O. Box 308
Safford, Arizona 85548
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with a copy to:
Mark S. Bryce, Esq.
Bryce, Angle & Holt, PLC
605 Main Street
Safford, Arizona 85546
13. APPLICABLE LAW. This Agreement shall be governed by and
construed (both as to validity and performance) and enforced in accordance with
the laws of the State of Arizona applicable to agreements made and to be
performed wholly within such jurisdiction.
14. FEDERAL COURT. Each party agrees that, in the event of any
litigation among the parties (or some of them) concerning this Agreement or the
transactions contemplated hereby, the initiating party shall use reasonable
efforts to bring such action in a federal court of competent personal and
subject matter jurisdiction.
15. COUNTERPARTS. This Agreement may be executed in any number of
counterparts with the same effect as if the signatures thereto and hereto were
upon the same instrument, but all of such counterparts taken together shall be
deemed to constitute one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed as of the day, month and year hereinabove set forth.
JADCO MANUFACTURING, INC.
an Arizona corporation
By:/s/ James C. Allen
-----------------------
James C. Allen
President
PHOTOCOMM, INC.
an Arizona corporation
By:/s/ Robert R. Kauffman
-----------------------
Robert R. Kauffman
Chief Executive Officer
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EXHIBIT B
COMMERCIAL LEASE
THIS lease agreement is entered into this 31st day of January, 1996
by and between JAMES C. ALLEN and SANDRA KAY ALLEN, husband and wife, whose
address is P.O. Box 308, Safford, AZ 85548 (referred to in this agreement as
the "Lessor"), and PHOTOCOMM, INC., a corporation organized under the laws of
the State of Arizona, whose address is 7681 E. Gray Road, Scottsdale, AZ 85260
(referred to in this agreement as the "Lessee").
In consideration of the promises and agreements made by and between
the Lessor and the Lessee in this agreement, the parties agree as follows:
Section 1. Description of Property. The Lessor agrees to lease to the
Lessee, and the Lessee agrees to rent and hire from the Lessor, on the terms and
conditions set forth in this agreement, the land and improvements located in
Graham County, Arizona, described as follows (referred to in this lease as the
"Premises"):
See Exhibit A attached hereto
Section 2. Initial Term of lease. The initial term of this lease
commence on January 31, 1996, and terminate at 5:00 o'clock p.m. on December 31,
1998, unless terminated sooner pursuant to the provisions of this agreement.
Section 3. Option to Extend Term of Lease. Lessee shall have one -
two year renewal option. If immediately prior to the renewal term this Lease
shall be in force and effect and Lessee shall not be in default, then, subject
to the provisions of this Section, Lessee shall have and hereby is given the
option to renew and extend this Lease for an additional term of two years, upon
the same terms, covenants, and conditions, as those herein contained, insofar as
then in force and applicable to such renewal term except that the Rent for such
renewal term shall be the then existing market rental rate for the Premises
based upon similarly situated buildings, and except that the terms of the
renewal shall not contain a provision for a further renewal.
In the event that Lessee wishes to exercise its right to renew
pursuant to this Section, Lessee shall give Lessor written notice of such
election at least 90, but not more than 180 days prior to the expiration date
of the initial term, provided, however, Lessee's failure to give proper notice
shall not affect the renewal rights of Lessee if Lessor has not executed a
lease agreement with another tenant for the Premises or any part thereof,
provided further, Lessee shall reimburse Lessor for any costs incurred by
Lessor in seeking a new tenant(s) for the Premises.
Section 4. Rent. The monthly rent for the Premises shall be
$4,000.00, plus applicable sales taxes, if any, payable in advance on the first
day of each month.
Section 5. Place of Payments. All payments made under this lease
shall be sent to the Lessor at the address shown at the beginning of this lease
or to such other person and/or address as the Lessor may designate in Writing.
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Section 6. Taxes. The Lessee will pay all real property taxes imposed
on the Premises, and all personal property taxes, business taxes and fees,
imposed on or with respect to the Premises or the Lessee's use of the Premises,
The Lessor will provide the Lessee with copies of the bills for the real estate
taxes, and the Lessee will pay the amounts payable under those bills to the
Lessor on or before the dates those bills are payable, or fifteen days after
receiving copies of the bills from the Lessor, whichever comes later. Taxes for
the year 1996 shall be pro-rated with Lessor paying 1/12 of such taxes and
Lessee paying 11/12 of such taxes.
Section 7. Utilities. The Lessee will be responsible for contracting
and paying for all utility services furnished to the Premises during the term of
this lease including but not limited to electric, gas, water, sewer, garbage,
alarm, and telephone service.
Section 8. Insurance. During the term of this lease, the Lessor
shall, at their own expense, obtain and maintain insurance for the Premises
including casualty insurance against all customary risks of loss or damage,
including but not limited to fire, flood, weather, earthquake and vandalism, for
not less than the replacement value of the Premises.
Section 9. Payment of expenses by the Lessor. If the Lessee fails to
pay any taxes, assessments, or other fees relating to the Premises as they
become due and owing, to discharge liens, security interests, and other
encumbrances on the Premises caused by Lessee, to repair, maintain, and protect
the Premises, or to perform any of the Lessee's other obligations under this
agreement, then the Lessor may, at its option, perform those obligations and pay
those expenses. The payment of expenses or the performance of acts by the
Lessor will not constitute a waiver of any default by the Lessee, or a waiver of
the Lessor's remedies in the event of a default. The Lessor will bill the
Lessee for any expenses paid by the Lessor pursuant to this section, and the
Lessee will reimburse the Lessor within thirty (30) days for the payments,
together with interest on such payments from the date of each payment at the
rate of ten percent (10%) per annum. If the Lessee fails to reimburse the
Lessor for the payments and interest within thirty days, then the Lessor may
declare the Lessee to be in default of this agreement.
Section 10. Condition, examination and acceptance of Premises. (a)
The Lessee acknowledges that the Lessee has inspected the Premises, is
satisfied with the condition of the Premises, and accepts the Premises in its
present condition.
(b) The Lessee acknowledges that the Lessee's decision to enter into
this lease was based upon the Lessee's own inspection and use of the Premises
and the Lessee's own judgement of its suitability and desirability for the
Lessee's purposes, and that the Lessee has not been governed or influenced by
any representation of the Lessor as to the condition, suitability, character or
earning capacity of the Premises.
(c) The Lessee acknowledges and confirms that the Lessee has examined
and inspected the Premises, is fully familiar with them, is entering into this
agreement based on such inspection and examination, and accepts the Premises AS
IS, in its present condition; that no representations of any kind have been
made by the Lessor or any representative of the Lessor with respect to the
condition, character, or earning capacity of the Premises or the suitability of
the Premises for any purpose for which the Lessee may desire to use them; and
that the Lessor has not made, and expressly disclaims, any warranties, express
or implied, as to the condition,
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character, or earning capacity of the Premises or the suitability of the
Premise for any purpose for which the Lessee may desire to use them.
Section 11. Warranties of Lessor. The Lessor warrants that the
Lessor owns the Premises and has the right to lease them, and that the
Lessee shall enjoy peaceable use of the Premises, free from interruption or
hindrance by the Lessor or any other person, for so long as the Lessee performs
its obligations under this agreement.
Section 12. Restrictions on use of the Premises. The Lessee shall
use the Premises to carry on its business as it has previously operated the
same upon the Premises, and shall not use or permit the use of the Premises for
any other purpose unless it obtains the prior written consent of the Lessor.
The Lessee shall not use or permit the use of the Premises for any illegal,
immoral, offensive, objectionable, improper, or disreputable purpose, any
purpose which may result in damage to the Premises, any purpose which may cause
a public or private nuisance or disturb other persons in the area, any purpose
which is dangerous or prohibited by any insurance policy, any purpose which may
increase the cost of insurance policies on the Premises or result in the
cancellation of any insurance policy, or any purpose which violates any
federal, state or local statute or regulation.
Section 13. Repairs and maintenance. The Lessee shall be responsible
for maintaining and repairing the Premises at the Lessee's expense. If the
Premises are damaged by fire or other casualty, insurance proceeds payable as a
result may be used, at Lessor's election to repair and replace the damaged
property. If not so used, such insurance proceeds shall be delivered to Lessor
and Lessee as their interests may appear, and this lease shall be terminated.
From the date of such damage, and until the Premises are fully restored, the
rental shall abate if there is total destruction, or if there is partial damage
and the Lessee is able to use part or all of the Premises for their intended
purpose, the rental amount shall be prorated based upon the square footage of
space of the building useable by Lessee.
Section 14. Alterations, additions and improvements. (a) The Lessee
may make nonstructural alterations, additions or improvements to the Premises
at its own expense at any time during the term of this Lease without obtaining
the prior consent of the Lessor, but shall not demolish or remove any
substantial portion of the Premises without obtaining the prior written consent
of the Lessor.
(b) All alterations, additions and improvements shall be made at the
expense of the Lessee, shall be performed in a workmanlike manner, and shall
not weaken the structural strength or reduce the value of the Premises or
change the purposes for which the Premises may be used. No liens of any type
shall be allowed to attach to the Premises unless prior written consent is
received from Lessor.
Section 15. Ownership of alterations, additions and improvements.
All alterations, additions and improvements made by the Lessee with the
exception of removable partitions, shelving, counters, machinery and other
trade fixtures and signs shall at the option of the Lessor become part of the
Premises and the property of the Lessor unless the Lessor agrees otherwise in
writing.
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<PAGE> 43
Section 16. Signs. Any signs installed by the Lessee must comply
with all applicable sign ordinances.
Section 17. Inspection and entry of Premises. The Lessor shall have,
the right to enter the Premises at reasonable times after giving the Lessee
reasonable prior notice to inspect them.
Section 18. Notification of damage, loss and claims. The Lessee
shall notify the Lessor immediately in writing of any damage or loss suffered
by the Premises, of any accidents involving the Premises, and of any claims,
suits, or other legal proceedings relating in any manner to the Premises, and
shall promptly advise the Lessor in writing of further developments relating to
any such events and provide the Lessor with copies of all documents relating to
such events.
Section 19. Condemnation. (a) If all or any part of the Premises are
taken or condemned by any public or quasi-public authority under the power of
eminent domain, the entire damages awarded as a result of the condemnation of
the Premises shall belong to the Lessor, and the Lessee shall not be entitled
to any part of the damages, with the exception of any damages expressly awarded
to the Lessee for damage to equipment and fixtures that belong to the Lessee,
removal and reinstallation of such equipment and fixtures, loss of business, or
moving expenses.
(b) If the entire Premises are taken or condemned, or a taking or
condemnation makes the Premises unsuitable for their intended use, this lease
shall terminate as of the date that the Lessee is required to surrender
possession of the Premises or becomes unable to use the Premises for their
intended use, whichever comes first, and the Lessee shall not be obligated to
pay any rent for periods after that date.
(c) If a portion of the Premises is taken or condemned, but the
remainder of the Premises is suitable for the Lessee's purposes, this lease
shall remain in effect with respect to the remainder of the Premises, and the
rent payable under this lease shall be reduced in proportion to the reduction
in square footage in the building on the Premises to the Lessee. The Lessor
shall be obligated to remedy any physical damage to the Premises caused by the
taking or condemnation within a reasonable period of time. The Lessee shall
have the right to declare the Premises unsuitable for its intended use and to
terminate this lease if the Lessor fails or refuses to remedy any physical
damage to the Premises caused by the taking or condemnation within a reasonable
period of time.
Section 20. Indemnification by Lessee. Except with respect to loss
or injury caused by the Lessor, the Lessee shall indemnity the Lessor against
and hold the Lessor harmless from any and all claims, actions, damages, losses,
injuries, demands, liabilities, costs and expenses, including attorneys' fees,
arising from the occupancy, use, condition or operation of the Premise by the
Lessee during the term of this lease, or from any injury or damage to any
person or property on the Premises during the term of this lease.
Section 21. Assignment and subletting by the Lessee. The Lessee
shall have the right to sublease, assign, mortgage, pledge or otherwise
transfer or encumber its rights under this lease, at any time, and from time to
time, or to permit the Premises to be used or occupied by others, without the
prior written consent of the Lessor. Unless specifically agreed to the
contrary by
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<PAGE> 44
Lessor, Lessee shall remain fully liable hereunder notwithstanding such
assignment or sublease by Lessee.
Section 22. Assignment by the Lessor. (a) The Lessor has the right
to sell, assign, pledge, mortgage, or otherwise transfer or encumber the
Premises, this lease or any of its rights under this lease without obtaining
the consent of the Lessee, provided that the transfer or encumbrance is subject
to the rights of the Lessee under this lease. Notwithstanding any such
assignment, the Lessor warrants that the Lessee shall quietly enjoy the use of
the Premises subject to the terms and conditions of this lease.
(b) If the Lessor transfers or assigns the Premises, this lease or
any of its rights under this lease, the right of the transferee or assignee to
receive the amounts due from the Lessee under this lease shall be free from all
defenses, setoffs and counterclaims that the Lessee may be entitled to assert
against the Lessor. The Lessee may separately assert any such defenses,
setoffs and counterclaims against the Lessor.
Section 23. Events of default. (a) The Lessor, at its option, may
declare the Lessee to be in default under this lease upon the occurrence of any
of the following events:
(i) The Lessee fails to make any lease payment payable under
this agreement within ten (10) days after such payment is due;
(ii) The Lessee fails to perform any of its other obligations
under this agreement within thirty (30) days after it receives a
request for such performance from the Lessor; provided, that if the
nature of the obligation is such that the Lessee cannot perform the
obligation within thirty (30) days after it receives a request for
performance from the Lessor, the Lessee will not be in default if it
commences efforts to perform the obligation within thirty (30) days
after it receives a request for performance and diligently pursues
those efforts to completion;
(iii) The Lessee files a petition in bankruptcy, makes an
assignment for the benefit of creditors, consents to the appointment
of a receiver or trustee for substantially all of its property, or
takes any action under any other law relating to the relief of
debtors;
(iv) An involuntary petition in bankruptcy is filed against
the Lessee, or a receiver or trustee is appointed to take possession
of substantially all of the property of the Lessee, and such petition
or appointment is not withdrawn or discharged within ninety (90) days;
(v) The Premises, the Lessee's rights under this lease, or a
material portion of the Lessee's property is subjected to any levy,
seizure, execution or sale by any creditor or government agency;
(vi) The Lessee's rights under this agreement are voluntarily
or involuntarily assigned, or the Premises are subleased or lent to
any other person, without the prior written consent of the Lessor; or
(vii) The Lessee vacates or abandons the Premises.
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<PAGE> 45
Section 24. Lessor's rights upon default. If the Lessor notifies the
Lessee in writing that it is in default under this agreement, and the Lessee
fails to cure the default within the required number of days after it receives
such written notice, the Lessor may, without making further notice or demand
upon the Lessee, take any or all of the following actions:
(i) Notify the Lessee that this lease has been terminated.
(ii) Require the Lessee to deliver possession of the Premises
and if the Lessee fails or refuses to deliver possession of the
Premises, to enter and take possession of the Premises, to remove the
property and personnel of the Lessee from the Premises at the expense
of the Lessee and to store the property in any reasonable manner and
place selected by the Lessor at the expense of the Lessee.
(iii) After terminating this lease, hold, renovate, or
dispose of the Premises or any part of the Premises on any terms
selected by the Lessor, free and clear of any rights of the Lessee and
without any duty to account to the Lessee for any proceeds of such
use.
(iv) Reenter the Premises without terminating this lease and
relet the Premises in any commercially reasonable manner, and apply
the proceeds of such reletting, after deducting all costs and expenses
incurred in connection with retaking possession of, remodeling, and
reletting the Premises, in payment of the Lessee's obligations under
this agreement, with the Lessee remaining responsible for any
deficiency.
(v) If the Lessee's default consists of failure to obtain,
maintain or pay for any of the insurance policies which this agreement
requires it to maintain, or failure to pay any tax, assessment, or
other charge which this agreement requires it to pay, or failure to
keep the Premises free from liens, levies and encumbrances, or failure
to indemnity the Lessor against any claim, action, damage, loss,
injury, demand, liability, cost or expense, the Lessor shall have the
right, but not be obligated, to take that action itself, and to bill
the Lessee for the costs of taking that action. If the Lessee fails
to pay such costs with the next payment due under this lease, the
Lessee agrees to pay late charges on those costs at the rate provided
for in this agreement.
(vi) Pursue any and all other rights or remedies available to
the Lessor at law or in equity.
Section 25. Mitigation. If the Lessor terminates this lease or
terminates the Lessee's right to possess the Premises the Lessor will mitigate
its damages by making reasonable efforts to relet the Premises on reasonable
terms. The Lessor may relet the Premises for a shorter or longer period of
time than the Lessee's remaining term under this lease, and in addition may
make any necessary repairs or alterations required in connection with the
reletting.
Section 26. Effect of exercise of remedies. The exercise of any
right or remedy available to the Lessor under this agreement, at law, or in
equity shall not prevent the Lessor from exercising any other such remedy.
Section 27. Surrender of Premises upon termination of lease. Upon
the expiration or termination of this lease, the Lessee shall remove all of its
personal property from the Premises
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<PAGE> 46
and surrender possession of the Premises and all keys to the Premises to the
Lessor, free and clear of all encumbrances, in the condition they were in at
the beginning of the lease with the exception of ordinary and reasonable wear
and tear. The Lessee shall repair all damage to the Premises caused by the
removal of equipment, trade fixtures, machinery, signs, and other personal
property.
Section 28. Lessee's liability for damage and abuse. If the Premises
are returned to the Lessor with damage, abuse, excessive wear and tear, missing
property, modifications not authorized by the Lessor, or otherwise not in the
condition they were in when they were delivered to the Lessee, the Lessee shall
be responsible for paying the costs of repairing the damage and returning the
Premises to the condition they were in when the Lessee took possession,
reasonable and ordinary wear and tear excepted.
Section 29. Failure of Lessee to remove Property. Any improvements,
fixtures, machinery and equipment remaining in the Premises more than thirty
(30) days after the expiration or termination of this lease shall, at the
option of the Lessor, be deemed abandoned and shall become the property of the
Lessor, without entitling the Lessee to any payment or offset. If the Lessor
does not elect to assume ownership of any improvements, fixtures, machinery and
equipment left in the Premises, it shall have the right to remove such property
from the Premises and store it at the risk and expense of the Lessee.
Section 30. Failure to surrender Premises. If the Lessee fails to
surrender the Premises to the Lessor upon the expiration or termination of this
lease, the Lessee's occupancy of the Premises shall be treated as a tenancy
from month-to-month, terminable at will by the Lessor, at a rental of 1.25
times the last monthly rental rate payable in advance on the first day of each
month. The Lessee shall not acquire any additional rights or interest in the
Premise by failing to surrender them, and the Lessor shall have the right to
take legal action to obtain the removal of the Lessee from the Premises.
Section 31. Waiver of offsets. The Lessee waives any and all
existing and future claims and offsets against the amounts payable to the
Lessor under this agreement, and agrees to pay the amounts due under this
agreement regardless of any offset or claim it may have against the Lessor.
Section 32. Successors bound by agreement. This agreement is binding
upon and shall inure to the benefit of the parties and their heirs, executors,
representatives, successors, and assigns.
Section 33. Entire agreement. This instrument constitutes the entire
agreement between the parties. No party shall be bound by any statements,
promises, understandings, conditions, warranties, or representations, oral or
written, not contained in this agreement. Each party acknowledges that the
execution of this agreement was not induced or motivated by any promise or
representation made by any other party, other than the promises and
representations expressly set forth in this agreement. All previous
statements, negotiations, preliminary instruments and agreements made by the
parties or their representatives are superseded by and merged into this
agreement, except as expressly provided in this agreement.
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<PAGE> 47
Section 34. Modification of agreement. No modification of this
agreement shall be valid or binding unless the modification is in writing,
signed by both parties to this agreement.
Section 35. Waiver. No waiver of any provision of this agreement
shall be valid or binding unless the waiver is in writing, signed by the party
waiving the provision. The failure of any party to this agreement to exercise
any right or remedy provided for in this agreement or to insist upon the strict
performance of any provision of this agreement shall not be a waiver of that
party's right to exercise that right or remedy or insist upon the strict
performance of that provision in the future.
Section 36. Severability of invalid provisions. If any provision of
this agreement is declared or becomes invalid, unenforceable or contrary to
law, the parties agree that the provision shall be severed from the remaining
provisions of this agreement and shall not affect the validity or
enforceability of the other provisions of this agreement.
Section 37. Notice. Any notice that this agreement requires or
permits to be delivered to any person shall be in writing and shall be
delivered to such person either personally or by depositing the same in the
United States mails, certified mail, return receipt requested, postage prepaid,
addressed to such person at the address set forth at the beginning of this
agreement, or to such other address as either party specifies by written notice
as herein provided.
Section 38. Attorneys' fees. If either of the parties to this
agreement institutes legal proceedings to enforce the terms of this agreement,
the parties agree that the unsuccessful party to the proceedings shall pay the
reasonable attorney's fees and legal costs of both parties, as they may be
approved by the court having jurisdiction over the proceedings, If either of
the parties to this agreement is required to appear in a bankruptcy or
receivership proceeding in which the other party is a debtor, the debtor will
pay the reasonable attorney's fees, court witness fees, and other costs which
the other party incurs as a result of the proceeding.
Section 39. Corporate action. The Lessee represents and warrants
that all corporate actions necessary to authorize the execution and performance
of this agreement have been taken.
Section 40. Time of Essence. Time shall be of the essence in
complying with the terms and conditions of this agreement.
Section 41. Computation of time. Whenever the last day for the
exercise of any privilege or the discharge of any duty under this agreement
shall fall upon a Saturday, a Sunday, or any public or legal holiday, whether
state or federal, the party having the privilege or duty shall have until 5:00
p.m. on the next regular business day to exercise the privilege or discharge
the duty.
Section 42. Headings. The headings, titles and subtitles in this
agreement are inserted for convenience of reference only, do not in any way
limit or amplify the terms and provisions of the agreement, and are to be
ignored in any construction of the provisions of the agreement.
Section 43. Applicable law. This agreement shall be governed by and
construed in accordance with the laws of the state of Arizona.
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Section 44. Option to purchase Premises. Lessee shall have the right
and option to purchase the Premises, and all of the structures, buildings, and
other improvements constructed thereon for a purchase price equal to the fair
market value thereof at the end of the initial or option term of this lease, as
the case may be. Lessee may exercise this option by giving notice to Lessor at
least thirty (30), but not more than ninety (90) days prior to the end of the
initial or option term of this lease. Upon exercise of this option, Lessee
will deposit $10,000 in cash with the Escrow Agent hereafter designated and in
such event, all terms, conditions and provisions herein contained shall serve
as a binding purchase agreement between the parties hereto.
If the parties are not able to agree upon the fair market value of the
Premises within ten (10) days after Lessee has given notice of its exercise of
this option to Lessor, then each of the parties shall select one appraiser and
said appraisers shall mutually select a third appraiser. The fair market value
shall be the average fo all three appraisals produced by such appraisers. In
the event any party fails to sellect an appraiser within ten (10) days after
the time to do so begins, then any party may seek the appointment of the
appraiser by the Superior Court and all time periods specified hereunder shall
be suspended pending sellection of such appraiser by the Court.
If Lessee shall exercise this option, Lessor shall give Lessee a good,
clear and marketable title to the Premises, free and clear of all tenancies
liens, encumbrances. encroachments, restrictions, reservations, conditions of
record and easements, except taxes due but not yet payable and zoning
restrictions, if any. If title is not marketable, then Lessee may elect to
either purchase the Premises subject to such unmarketable condition with no
reduction in the purchase price or any liability to Lessor, or cancel and
terminate its purchase of the Premises, in which event the deposit paid by
Lessee to the Escrow Agent shall be refunded in full and the parties shall have
no further liability under this Section 44. Transfer of the Premises shall be
made by general warranty deed conveying title to Lessee, in fee simple. If
there is any lien or encumbrance of record against the Premises, Lessee may
elect to take the Premises subject to any such lien or encumbrance: in such
event, the full amount thereof, together with any interest and penalties
accrued thereon as of the date of transfer, shall be deducted from the purchase
price herein, and Lessee will thereafter indemnify and save Lessor harmless
from all further liability thereunder.
Within thirty (30) days after Lessee exercises this option, all documents
and monies required hereunder shall be deposited by the respective parties with
the Escrow Agent, which shall be any title company licensed to do business in
the state wherein the Premises are located. This Agreement shall serve as the
Escrow Instructions, subject to the Escrow Agent's usual condition of
acceptance where not contrary to any of the terms hereof. Real estate taxes,
insurance, and any other prepaid or accrued charges customarily prorated shall
be prorated as of the date of transfer according to the calendar year. Lessor,
at Lessor's expense, shall furnish Lessee with an owner's or fee policy of
title insurance, issued by a title insurance company first approved by Lessee,
in the amount of the purchase price, as evidence or assurance that there has
been conveyed to Lessee, the title required to be conveyed hereunder. The
Escrow Agent shall cause title to the Premises to be searched, and if and when
the required evidence of title can be issued and the Escrow Agent has received
all funds and documents required to be deposited hereunder, the Escrow Agent
shall cause the deed to be filed of record and the funds disbursed in
accordance herewith.
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The Escrow Agent shall charge Lessor with the cost of the owner's or fee
policy of title insurance, including premium, location survey, and title
examination charges, revenue or other documentary stamps, if required, any
transfer, or similar tax or charge, imposed by reason of this sale and
conveyance of the Premises, and one half of the escrow fee. The Escrow Agent
shall charge Lessee with the recording fees and one half of the escrow fee.
This escrow shall close within sixty (60) days after all documents and monies
required hereunder shall be deposited with the Escrow Agent. However, in the
event Lessor shall be unable to convey title to Lessee, as hereinbefore
required, then Lessee shall have the right to terminate and rescind the
exercise of this option without any liability, and in such event, any and all
sums that Lessee deposited in escrow hereunder shall be forthwith returned to
Lessee by the Escrow Agent, and this escrow shall be canceled.
IN WITNESS WHEREOF, the parties have executed this agreement on the
date set forth above.
LESSOR:
/s/ James C. Allen
- ---------------------------
JAMES C. ALLEN
/s/ Sandra Kay Allen
- ---------------------------
SANDRA KAY ALLEN
LESSEE:
PHOTOCOMM, INC.
an Arizona corporation
By:/s/ Robert R. Kauffman
------------------------
Robert R. Kauffman
Chief Executive Officer
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EXHIBIT A
LEGAL DESCRIPTION
LOTS 2 AND 4, BLOCK 5, JENSEN ADDITION, ACCORDING TO FILE NO. 2, J-1, RECORDS OF
GRAHAM COUNTY, ARIZONA
<PAGE> 51
EXHIBIT C
EMPLOYMENT AGREEMENT
(JAMES C. ALLEN)
This Agreement is made and entered into this 31st day of
January, 1996, but effective as of February 16, 1996 (the "Effective Date"), by
and between PHOTOCOMM, INC., an Arizona corporation (the "Company") and JAMES C.
ALLEN ("Employee").
WHEREAS, Employee was previously employed as President, and
was the majority stockholder of Jadco Manufacturing, Inc. ("Jadco"); and
WHEREAS, The Company has acquired the entire business and
assets of Jadco, which business shall be conducted as an integral operating
unit of the Company; and
WHEREAS, Employee was a key executive in Jadco, with expertise
in the design, development, marketing, distribution and sale of Jadco's
products and services, knowledge of the operation of the business, including
particularly distribution, sales, and customer relation matters; and
WHEREAS, The Company desires to assure continuance of
Employee's service in connection with such business; and
WHEREAS, the parties agree that a covenant not to compete is
essential to the growth and stability of the business of Jadco during the first
years after its acquisition by the Company and to the continuing viability of
such business whenever the employment to which this Agreement relates is
terminated, in accordance therewith the Company has entered into, or will
contemporaneously herewith enter into that certain Non-Competition and
Non-Disclosure Agreement as part of the consideration herein (the
"Non-Competition and Non-Disclosure Agreement").
NOW THEREFORE, in consideration of the mutual agreements herein set forth, the
parties agree as follows:
1. DUTIES.
Upon the effective date, the Company shall employ Employee,
and the Employee agrees to be employed by the Company as General Manager of the
pump division of the Company, and shall perform such day to day operations of
the division and such additional different or other duties related to the
business as may from time to time be delegated by the Company. The Employee
shall devote substantially all of his time to such duties, except for vacation
periods as designated by the Company's policies, and shall otherwise observe
and abide by the reasonable corporate policies and decisions of the Company in
all business matters, and shall be responsible and accountable to the senior
manager designated by the Chief Executive Office of the Company from time to
time.
<PAGE> 52
2. TERM.
The Employee's employment shall begin on the effective date of
this Agreement and continue until December 31, 1998.
3. COMPENSATION.
The Company shall pay and the Employee shall accept as full
consideration for the services to be rendered hereunder compensation consisting
of the following:
a. An initial salary of $4,000.00 per month (with anticipated
annual increases based upon performance), as well as an annual incentive bonus
based upon gross profit contribution of the pump division.
b. The Employee shall also receive such other benefits as may be
made available from time to time to other management employees of the Company
with similar position, age and years of service as Employee.
c. Such other items of compensation as may be agreed upon by
Employee and the Company from time to time.
4. COMPANY'S COVENANTS
In connection with the Company's employment of Employee as
provided hereunder, the Company agrees that so long as this Agreement is in
effect and Employee has not breached any of the terms hereof, the Company will
not (a) change or add to Employee's duties as an employee of the Company which
would necessitate as a practical matter the relocation of Employee's principal
place of residence as of the date of this Agreement (which is Safford,
Arizona); or (b) materially reduce Employee's duties as an employee of the
Company from those described herein, or materially reduce Employee's authority
in Employee's position as described herein. Notwithstanding the provisions
hereof, a reasonable amount of travel, as may vary and be necessitated from
time to time because of Employee's duties hereunder will not be deemed to be a
change or addition to Employee's duties prohibited hereunder.
6. MISCELLANEOUS.
a. GOVERNING LAW. The validity, construction,
interpretation and enforceability of this Agreement and the capacity of the
parties shall be determined and governed by the laws of the State of Arizona.
b. ASSIGNMENT. This Agreement is personal to each of
the parties hereto, and neither party may assign or delegate any of the rights
or obligations hereunder without first obtaining a written consent of the other
party.
c. RIGHTS AND REMEDIES. Both parties recognize that the
services to be rendered under this Agreement by Employee are special, unique,
and of extraordinary character. In the event of the occurrence of any of the
following, either party may, at its option, terminate this Agreement or elect
to institute and prosecute proceedings in any court of competent
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<PAGE> 53
jurisdiction, either in law or equity, to obtain damages or to enforce specific
performance of the Agreement to enjoin the other party as appropriate and to
recover reasonable attorneys' fees and costs of prosecuting such action:
i. if there is a substantial breach by either party
of any of the terms and conditions of this Agreement
and such breach remains uncured after the expiration
of ten (10) days from the date of receipt of written
notice by the other party; or
ii. if there is a breach by Employee of any of the
covenants of the Non-Competition and Non-Disclosure
Agreement or if there is any act of dishonesty,
malfeasance or gross negligence by Employee.
Termination for any cause shall not constitute a waiver of the Company's rights
under the Non-Competition and Non-Disclosure Agreement nor a release of
Employee from his other obligations hereunder. The rights and remedies
provided each of the parties herein shall be cumulative and in addition to any
other rights and remedies provided by law or otherwise. Any failure in the
exercise by either party of such party's rights to terminate this Agreement or
to enforce any provision of this Agreement for default or violation by the
other party shall not prejudice such party's right of termination or
enforcement for any further or other default or violation.
d. COLLATERAL AGREEMENTS. This Agreement and the
Non-Competition and Non-Disclosure Agreement constitute the entire Agreement
between the parties respecting the employment of Employee, and there are no
representations, warranties or commitments, except as set forth herein. This
Agreement may be amended only by an instrument in writing executed by the
parties hereto.
e. NOTICES. Any notice, request, demand or other
communication hereunder shall be in writing and shall be deemed to be duly
given when personally delivered to an officer of the Company (other than to
Employee, if Employee is or becomes an officer of the Company) or to Employee,
as the case may be, or when delivered by mail at the following addresses:
James C. Allen
P.O. Box 308
Safford, Arizona 85548
Photocomm, Inc.
7681 E. Gray Road
Scottsdale, Arizona 85260
With a copy to:
Steven P. Oman, Esq.
Oman, Schulenburg & Politan, P.L.C
4801 E. Greenway Road
Scottsdale, Arizona 85254
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<PAGE> 54
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the first date above written.
/s/ James C. Allen
-----------------------------
JAMES C. ALLEN
(EMPLOYEE)
PHOTOCOMM, INC., an Arizona Corporation
By:/s/ Robert R. Kauffman
--------------------------
Robert R. Kauffman
Chief Executive Officer
(COMPANY)
4
<PAGE> 55
EXHIBIT D
NON-COMPETITION AND NON-DISCLOSURE
AGREEMENT
(JAMES C. ALLEN)
This Non-Competition and Non-Disclosure Agreement (the "Agreement") is
made and entered into this 31st day of January, 1996, by and between JAMES C.
ALLEN ("Covenantor") and PHOTOCOMM, INC., an Arizona corporation (the
"Company") and is made with reference to the following:
RECITALS
A. The Company is engaged in the business of manufacturing,
distributing, marketing and selling solar electric products. The Company
currently conducts business world wide.
B. Covenantor is or will be a shareholder of the Company and has
been or will be employed by the Company pursuant to an Employment Agreement
entered into contemporaneous herewith (the "Employment Agreement").
C. Pursuant to that certain Agreement and Plan of Reorganization
entered into contemporaneous herewith by and among Jadco Manufacturing, Inc.
("Jadco", owned by Covenantor), as Seller and the Company as Purchaser (the
"Purchase Agreement"), the Company is acquiring all of the business and assets
of Jadco.
D. Covenantor acknowledges that the Company and its employees and
shareholders have over many years devoted substantial time, effort and
resources to developing the Company's trade secrets and its other confidential
and proprietary information, as well as the Company's relationships with
customers, suppliers, employees and others doing business with the Company;
that such relationships, trade secrets and other information are vital to the
successful conduct of the Company's business in the future; that the Company is
entering into the Purchase Agreement relying on the fact that Covenantor, as
shareholder and officer of Jadco, has established personal and professional
relationships with customers, suppliers, employees and others having business
relationships with the business of Jadco which is being purchased by the
Company, and Covenantor has had unlimited access to Jadco's trade secrets and
other confidential and proprietary information, and because of Covenantor's
employment pursuant to the Employment Agreement, Covenantor will have
substantial access to the Company's other trade secrets and confidential
information; and that because of such relationships and because of Covenantor's
access to the Company's confidential information and trade secrets, Covenantor
would be in a unique position to divert business from the Company and to commit
irreparable damage to the Company were Covenantor to be allowed to compete with
the Company or to commit any of the other acts prohibited below; that the
enforcement of said restrictive covenants against Covenantor would not impose
any undue burden upon Covenantor; that none of said restrictive covenants is
unreasonable as to period or geographic area; and that the ability to enforce
said restrictive covenants against Covenantor is a material inducement to the
decision of the Company to consummate the transactions contemplated in the
Purchase Agreement.
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<PAGE> 56
NOW, THEREFORE in consideration of the foregoing recitals, the mutual
agreements hereinafter set forth and the mutual benefits to be derived
therefrom, Covenantor covenants and agrees as follows:
1. Definitions.
(a) The term "Company," as used herein, means not only
Photocomm, Inc., but also any company, partnership or entity which, directly or
indirectly, controls, is controlled by or is under common control with
Photocomm, Inc.
(b) The term "Confidential Information", as used herein,
means all information or materials not generally known by non-Company personnel
which (i) gives the Company some competitive business advantage or the
opportunity of obtaining such advantage or the disclosure of which could be
detrimental to the interest of the Company; (ii) which is owned by the Company
or in which the Company has an interest and (iii) which is either (A) marked
"Confidential Information", "Proprietary Information" or other similar marking,
(B) known by Covenantor to be considered confidential and proprietary by the
Company, or (C) from all the relevant circumstances would reasonably by assumed
by Covenantor to be confidential and proprietary to the Company. Confidential
Information includes, but is not limited to, the following types of information
and other information of a similar nature (whether or not reduced to writing):
trade secrets, inventions, drawings, file data, documentation, diagrams,
specifications, know how, processes, formulas, models, flow charts, software in
various stages of development, source codes, object codes, research and
development procedures, research or development and test results, marketing
techniques and materials, marketing, development and distribution plans, price
lists, pricing policies, business plans, information relating to customers
and/or suppliers' identities, characteristics and agreements, financial
information and projections, and employee files. Confidential Information also
includes any information described above which the Company obtains from another
party and which the Company treats as proprietary or designates as Confidential
Information, whether or not owned or developed by the Company. Notwithstanding
the above, however, no information constitutes confidential information if it
is generic information or general knowledge which Covenantor would have learned
in the course of similar employment elsewhere in the trade or if it is
otherwise publicly known and in the public domain.
(c) The term "Closing" shall have the meaning ascribed to it in
the Purchase Agreement.
2. Covenant Not to Compete. Covenantor shall not at any time
prior to the later to occur of (a) the end of the five (5) year period
immediately following the Closing or (b) the end of the one (1) year period
following termination of Covenantor's employment with the Company (the
"Restricted Period"), have any ownership interest (of record or beneficial) in
or have any interest (other than in the Company) as an employee, salesman,
consultant, officer or director in, or otherwise aid or assist in any manner
(i) any firm, corporation, partnership, proprietorship or other business that
engages anywhere in the World in a business which is similar to that in which
the Company is engaged (or in which Jadco is engaged, the business of which is
being purchased by the Company) in such territory as of the Closing, so long as
the Company, or any successor in interest of the Company to the business and
goodwill of the Company, remains engaged in such business in such territory or
continues to solicit customers or potential
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customers provided, however, that Covenantor may own, directly or indirectly,
solely as an investment, securities of any person which are traded on any
national securities exchange if such shareholder (i) is not a controlling
person of, or a member of a group which controls, such person or (ii) does not,
directly or indirectly own one percent or more of any class of securities of
such person.
3. Solicitation of Business. During the Restricted Period,
Covenantor shall not solicit or assist any other person to solicit any business
(other than for the Company) from any present or past customer of the Company
or Jadco, or request or advise any present or future customer, vendor or
consultant of the Company to withdraw, curtail or cancel its business dealings
with the Company; or commit any other act or assist others to commit any other
act which might injure the business of the Company.
4. Employees. During the Restricted Period, Covenantor shall not
directly or indirectly (i) solicit or encourage any employee of the Company to
leave the employ of the Company or (ii) hire any employee who has left the
employ of the Company if such hiring is proposed to occur within one year after
the termination of such employee's employment with the Company.
5. Nondisclosure. From and after the Closing, Covenantor shall
not (nor will Covenantor assist any other person to do so) directly or
indirectly reveal, report, publish or disclose the Confidential Information to
any person, firm or corporation not expressly authorized by the Company to
receive such Confidential Information, or use (or assist any person to use)
such Confidential Information except for the benefit of the Company.
6. Ownership and Return of Materials. To the extent that
Covenantor has not already done so, Covenantor shall immediately following
termination of employment with the Company surrender to the Company all notes,
data, sketches, drawings, manuals, documents, records, data bases, programs,
blueprints, memoranda, specifications, customer lists, financial reports,
equipment and all other physical forms of expression incorporating or
containing any Confidential Information, it being distinctly understood that
all such writings, physical forms of expression and other things are the
exclusive property of the Company.
7. Consideration. In consideration for entering into this
Agreement, the Company agrees to pay Covenantor the aggregate amount of One
Hundred Fifty Thousand and no/100ths Dollars ($150,000.00), payable in monthly
installments of Two Thousand Five Hundred and no/100th Dollars ($2,500.00)
commencing thirty (30) days after the Closing, and continuing thereafter on the
same day each month until fully paid.
8. Rights and Remedies Upon Breach. If Covenantor breaches, or
threatens to commit a breach of, any of the provisions of this Agreement (the
"Restrictive Covenants"), the Company shall have the following rights and
remedies, each of which shall be in addition to, and not in lieu of, any other
rights and remedies available to the Company under law or in equity;
(a) Specific Performance. The right and remedy to have
the Restrictive Covenants specifically enforced or to have any
actual or threatened breach thereof enjoined by any court
having equity jurisdiction, all without the need to post a
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<PAGE> 58
bond or any other security or to prove any amount of actual
damage or that money damages would not provide an adequate
remedy, it being acknowledged and agreed that any such breach
or threatened breach will cause irreparable injury to the
Company and that monetary damages will not provide an adequate
remedy to the Company; and
(b) Accounting and Indemnification. The right and remedy
to require Covenantor (i) to account for and pay over to the
Company all compensation, profits, monies, accruals,
increments or other benefits derived or received by Covenantor
or any associated party deriving such benefit as a result of
any such breach of the Restrictive Covenants; and (ii) to
indemnify the Company against any other losses, damages
(including special and consequential damages), costs and
expenses, including actual attorney's fees and court costs,
which may be incurred by them and which result from or arise
out of any such breach or threatened breach of the Restrictive
Covenants.
9. Severability of Covenants/Blue Penciling. The Restrictive
Covenants shall be subject to Section 13(g) hereof and Covenantor hereby waives
any and all right to attack the validity of the Restrictive Covenants on the
grounds of the breadth of their geographic scope or the length of their term.
10. Enforceability in Jurisdictions. The Company and Covenantor
intends to and do hereby confer jurisdiction to enforce the Restrictive
Covenants upon the courts of any jurisdiction within the geographical scope of
such covenants. If the courts of any one or more of such jurisdictions hold
the Restrictive Covenants wholly unenforceable by reason of the breadth of such
scope or otherwise, it is the intention of the Company and Covenantor that such
determination not bar or in any way affect the right of the Company to the
relief provided above in the courts of any other jurisdiction within the
geographical scope of such covenants, as to breaches of such covenants in such
other respective jurisdictions, such covenants as they relate to each
jurisdiction being, for this purpose, severable into diverse and independent
covenants.
11. Attorney's Fees. In the event of any action, suit, or other
proceeding concerning the negotiation, interpretation, validity, performance,
or breach of this Agreement, the prevailing party shall recover all of such
party's actual attorney's fees, expenses, and costs, not limited to costs of
suit, incurred in each and every such action, suit, or other proceeding,
including any and all appeals or petitions relating thereto. As used herein
"actual attorneys' fees" means the full and actual cost of any legal services
actually performed in connection with the matter for which such fees are sought
calculated on the basis of the usual fees charged by the attorneys performing
such services, and shall not be limited to "reasonable attorneys' fees" as that
term may be defined in statutory or decisional authority.
12. Miscellaneous.
(a) Modification. This Agreement, the Employment
Agreement and the Purchase Agreement and all other documents entered into
pursuant to its terms set forth the entire understanding of the parties with
respect to the subject matter hereof, supersedes all
4
<PAGE> 59
existing agreement between them concerning such subject matter, and may be
modified only by a written instrument duly executed by each party.
(b) Successors and Assigns. The terms and provisions of
this Agreement shall be binding upon, and shall inure to the benefit of, the
parties hereto, their personal representatives, administrators, executors,
heirs, successors and assigns.
(c) Waiver. The failure of either party hereto at any
time to enforce performance by the other party of any provision of this
Agreement shall in no way affect such party's rights thereafter to enforce the
same; nor shall the waiver by either party of any breach of any provision
hereof be deemed to be a waiver by such party of any other breach of the same
or any other provision hereof.
(d) Notices. All notices, requests and other
communications hereunder shall be in writing and shall be delivered by courier
or other means of personal service (including by means of a nationally
recognized courier service or professional messenger service), or sent telex or
telecopy or mailed first class, postage prepaid, by certified mail, return
receipt requested, in all cases addressed to:
Company: PHOTOCOMM, INC.
7681 E. Gray Road
Scottsdale, AZ 85260
With a copy to: Steven P. Oman
Oman, Schulenburg & Politan, P.L.C.
4801 E. Greenway Road
Scottsdale, Arizona 85254
Covenantor: James C. Allen
P.O. Box 308
Safford, Arizona 85548
All notices, requests and other communications shall be deemed
given on the date of actual receipt or delivery as evidenced by written
receipt, acknowledgment or other evidence of actual receipt of delivery to the
address. In case of service by telecopy, a copy of such notice shall be
personally delivered or sent by registered or certified mail, in the manner set
forth above, within three business days thereafter. Any party hereto may from
time to time by notice in writing served as set forth above designate a
different address or a different or additional personal to which all such
notices or communications thereafter are to be given.
(e) Time of Essence. Time is hereby declared to be of the
essence of this Agreement and of every part hereof.
(f) Severance and Enforcement. All Sections, clauses and
covenants contained in this Agreement are severable, and in the event any of
them shall be held to be invalid by any court, this Agreement shall be
interpreted as if such invalid Sections, clauses or covenants were not
contained herein. Without limitation, the parties intend that the covenants
contained in this Agreement shall be severable insofar as the geographic and
time restrictions set forth herein are
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<PAGE> 60
concerned. If, in any judicial proceeding, a court shall refuse to enforce the
geographic and/or time restriction set forth herein to their fullest extent,
then the geographic and/or time restrictions set forth herein shall be reduced
to the extent necessary to permit enforcement of the foregoing covenant to the
fullest extent possible.
(g) Governing Law and Venue. This Agreement is to be
governed by and construed in accordance with the laws of the State of Arizona
applicable to contracts made and to be performed wholly within such State, and
without regard to the conflicts of laws principles thereof. Subject to Section
11 hereof, any suit brought hereon shall be brought in the state or federal
courts sitting in Phoenix, Arizona, the parties hereto hereby waiving any claim
or defense that such forum is not convenient or proper. Subject to Section 11
hereof, each party hereby agrees that any such court shall have in personam
jurisdiction over it and consents to service of process in any manner
authorized by Arizona law.
(h) Gender. Where the context so requires, the use of
the masculine gender shall include the feminine and/or neuter genders and the
singular shall include the plural, and vice versa, and the word "person" shall
include any corporation, firm, partnership or other form of association.
(i) Counterparts. This Agreement may be executed in one
or more counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same Agreement.
(j) Construction. The language in all parts of this
Agreement shall in all cases be construed simply, accordingly to its fair
meaning, and not strictly for or against any of the parties hereto. Without
limitation, there shall be no presumption against any party on the ground that
such party was responsible for drafting this Agreement or any part thereof.
IN WITNESS WHEREOF, the parties hereto duly executed this Agreement as
of the date and year first above written.
COVENANTOR: /s/ James C. Allen
------------------------------------
James C. Allen
THE COMPANY: Photocomm, Inc., an Arizona corporation
By:/s/ Robert R. Kauffman
---------------------------------
Robert R. Kauffman
Chief Executive Officer
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<PAGE> 1
EXHIBIT 2
Contact: Thomas LaVoy
Chief Financial Officer
(602) 948-8003
For Immediate Release
PHOTOCOMM ACQUIRES SOLAR ELECTRIC
WATER PUMP MANUFACTURER
-------------------
Scottsdale, Arizona, February 2, 1996...Photocomm, Inc. (Nasdaq: PCOM)
has acquired Solarjack(TM), a solar electric pumping products manufacturer
located in Safford, Arizona.
Solarjack is the nation's leading manufacturer and marketer of
wireless, solar pumping systems for off-grid ranch, remote home and third world
village water delivery. Since its establishment in 1985 by President Jim
Allen, Solarjack has focused on research and development, achieving significant
technological leadership in its major product lines. In recent years, the
company has commenced transition to commercial-scale production and sales, and
in 1995 posted pre-tax net income of $260,000 on sales revenue of $1.5 million.
Solarjack has pioneered development of the emerging solar pumping
market for small capacity, off-grid applications. The Solarjack SDS Series,
introduced in 1988, was the industry's first reliable, cost effective solar
submersible well pump, and remains the industry standard for quality and cost
effective performance.
In 1995, Solarjack introduced the new SCS Series centrifugal pumps
featuring a unique, high efficiency, brushless DC motor, the successful result
of an intensive three year development program. Designed for higher capacities
and deeper well pumping than the earlier generation SDS Series, the new SCS
pumps are competitively priced to penetrate markets for larger, off-grid
applications such as ranch windmill replacement and high volume village water
delivery systems.
In the future, Solarjack will operate as Photocomm's solar pumping
division, retaining its tradename and present staff. Solarjack founder Jim
Allen will continue on a long-term contractual basis as a senior Photocomm
manager and President of the Company's new Solarjack Division, focusing on
research and development.
more...over
<PAGE> 2
Bob Kauffman, Photocomm CEO, stated "Jim Allen and his staff have made
tremendous technical progress in recent years and, I believe, have achieved a
true breakthrough with their new SCS product line. Our challenge and
opportunity is straightforward: to rapidly penetrate the key market segments
worldwide. We are highly experienced in these markets and believe that we can
achieve significant sales results with the Solarjack product line."
Jim Allen, Solarjack founder and President, stated "It's obviously a
very difficult decision to sell your company, but I am convinced that joining
Photocomm at this time will finally permit us to exploit the large potential
market for our technology. In our case, Photocomm is the ideal partner with
their strengths of system integration, marketing, sales and financial assets.
Photocomm is justifiably the `hottest' company in the solar electric industry,
and I think that together we can finally realize the market potential for our
products."
Photocomm, Inc., headquartered in Scottsdale, Arizona, is the nation's
largest publicly-owned manufacturer and marketer of wireless solar electric
power systems. The Company's stock is listed on the Nasdaq system under the
symbol PCOM.
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