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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date earliest event reported) August 30, 1996
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VALUE HOLDINGS, INC.
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(exact name of registrant as specified in its charter)
FLORIDA
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(State or other jurisdiction of incorporation)
0-15076 59-2388734
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(Commission File Number) (IRS Employer Identification Number)
3211 PONCE DE LEON BLVD., CORAL GABLES, FL 33134
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(Address of principal executive offices) (Zip Code)
Registrant's Telephone Number, Including Area Code: (305) 666-3165
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N/A
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(Former name or former address, if changed since last report)
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Item 5. Other Events.
On August 30, 1996, Value Holdings, Inc. (the "Company") converted
certain promissory notes in the principal amount of Canadian $2,309,637 issued
to the Company by Forest Hill Capital Corporation ("Forest Hill") into
3,666,091 shares of Forest Hill Common Stock. Forest Hill is a corporation
incorporated under the laws of the Province of Ontario, Canada that is engaged
in optical retailing, hearing aid retailing and installed home improvement.
Forest Hill has 44 locations in Hudson's Bay and Zeller's department stores
across Canada. In addition, Forest Hill is developing three additional
businesses: contact lens mail order, safety supply and managed health care.
As a result of the conversion of the debt into stock, the Company owns
approximately 44% of the outstanding stock of Forest Hill. The effect on the
balance sheet of the Company of the conversion of the debt into equity is shown
on the attached pro forma balance sheet of the Company.
Item 7. Financial Statements and Agreements.
(c) Exhibits
1. Stock Conversion Agreement dated as of August 30, 1996
between Value Holdings, Inc. and Forest Hill Capital Corporation.
2. Pro forma Consolidated Balance Sheet (unaudited).
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, thereunto duly authorized.
VALUE HOLDING, INC.
By /s/ Anthony Pallante
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Anthony Pallante
President
Date: September 17, 1996
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EXHIBIT 1
STOCK CONVERSION AGREEMENT
THIS STOCK CONVERSION AGREEMENT is made as of the 30th day of
August, 1996, by and between Forest Hill Capital Corporation (formerly
Equashare Management Corporation), a company organized and existing under the
laws of the Province of Ontario (the "Corporation") and Value Holdings, Inc. a
corporation existing under the laws of the State of Florida ("VHI").
WHEREAS, the Corporation is justly indebted to VHI in the
amount of Canadian $2,309,637 by virtue of: (1) the Promissory Note dated
February 23, 1996 in original principal amount of Canadian $1,155,008; (2) the
Promissory Note dated January 18, 1996 in the original principal amount of
Canadian $135,000 (iii) the Promissory Note dated January 15, 1996 in original
principal amount Canadian $205,000 and (iv) the Promissory Note dated January
19, 1996 in original principal amount of Canadian $700,000, true and correct
copies of which are attached hereto as Exhibits A-D respectively (collectively
and individually referred to as the "Notes"); and
WHEREAS, VHI is the current Holder of each of the Notes; and
WHEREAS, the Corporation is not in default of its obligations
under the Notes; and
WHEREAS, VHI currently holds 650,000 shares of the
Corporation's common stock; and
WHEREAS, both VHI and the Corporation agree that it is in
their collective and respective individual best interests to convert all of the
debt owed to VHI by the Corporation under the Notes into shares of common stock
of the Corporation (the "Common Stock") at a share conversion price of Canadian
$0.63 per share.
NOW, THEREFORE, the parties hereto hereby agree as follows:
1. Conversion and Transfer of the Shares. At Closing
(as defined below), the Corporation will issue to VHI and VHI will acquire from
the Corporation 3,666,091 shares of the Corporation's Common Stock (the
"Shares") at a transfer price of Sixty Three Canadian Cents ($0.63) per Share
for an aggregate transfer price equal to Canadian $2,309,637 (the "Transfer
Price").
2. Closing. The closing of the purchase and sale of the
Shares hereunder (the "Closing") will take place by delivery from the
Corporation to VHI of the Corporation's stock certificate(s) evidencing
ownership of the shares in the name of VHI. At Closing, and in lieu of any
payments VHI will deliver to the Corporation the Transfer Price evidenced by
delivery of the Notes marked "SATISFIED IN FULL/CANCELLED."
3. Registration Rights. Upon the written request of
VHI, the Corporation shall take those steps necessary, if any, and at its own
expense, to prepare and file a registration statement with respect to the
Shares pursuant to the Ontario Securities Act (the "Securities Act").
4. Representations and Warranties of the Corporation.
In connection with the purchase and sale of the Shares hereunder, the
Corporation hereby represents and warrants to VHI that:
(a) This Agreement has been duly executed and
delivered by the Corporation and constitutes the legal, valid and binding
obligation of the Corporation, enforceable in accordance with its terms.
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(b) The execution, delivery and performance of
this Agreement by the Corporation does not and will not conflict with, violate
or cause a breach of the Securities Act or any agreement, contract or
instrument to which the Corporation is a party or any judgment, order or decree
to which the Corporation is subject.
(c) Upon issuance in accordance with the terms of
this Agreement, the Shares will be duly authorized, validly issued, fully paid
and non-assessable, and the Corporation will transfer to VHI good and valid
title to the Shares, free and clear of all liens and encumbrances.
5. Representations and Warranties of VHI. In connection
with the transfer and acquisition of the Shares hereunder, VHI hereby
represents and warrants to the Corporation that this Agreement has been duly
executed and delivered by VHI and constitutes the legal, valid and binding
obligation of VHI, enforceable in accordance with its terms, and the execution,
delivery and performance of this Agreement by VHI does not and will not
conflict with, violate or cause a breach of any agreement, contract or
instrument to which VHI is a party or any judgment, order or degree to which
VHI is subject.
6. Relationship Among the Parties. That notwithstanding
that fact that by virtue of this transaction VHI shall own 47% of the total
stock of the Corporation, the relationship between the Corporation and VHI
shall be that of a Shareholder and Corporation and VHI shall not be deemed to
control the Corporation within the meaning of the Securities Act. This
Agreement and the transaction contemplated hereby shall not be construed to
create a partnership or joint venture between the parties hereto.
7. Miscellaneous:
(a) This Agreement embodies the complete
agreement and understanding among the parties hereto with respect to the
subject matter hereof and supersedes and replaces any prior understandings,
agreements or representations by or among the parties, written or oral, which
may have related to the subject matter hereof in any way.
(b) This Agreement shall bind and inure to the
benefit of an shall be enforceable by the parties hereto and their successors
and assigns.
(c) This Agreement may be executed in
counterparts, any one of which need not contain the signature of more than one
party, and each such counterpart will be deemed an original and all such
counterparts together will constitute one and the same Agreement.
(d) The headings of the various sections of this
Agreement have been inserted for convenience of reference only and will not be
deemed a part of this Agreement.
(e) This Agreement may be amended only in a
writing executed by both of the parties hereto, and any provision hereof may be
waived, but only in a writing executed by the party against which such waiver
is being enforced.
(f) Any notice provided for in this Agreement
shall be in writing and shall be either personally delivered, or mailed first
class or registered mail (postage prepaid) or sent by reputable overnight
courier service [i.e., Federal Express, U.P.S., etc.] (charges prepaid) to VHI
and the Corporation at the following addresses (or at such other address or to
the attention of such other person as the recipient party has specified by
prior written notice to the sending party):
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If to the Corporation: 10 Director Court, Suite 200
Vaugham, Ontario, Canada
If to VHI: 3211 Ponce DeLeon Blvd.
Suite 201
Coral Gables, FL 33134
(g) The Corporation agrees to bear all costs and
expenses of VHI's attorneys in connection with this Agreement. The Corporation
also agrees to pay any stock transfer taxes imposed upon the issuance of the
Shares.
(h) Each party on their respective behalf agrees
to deliver such further instruments and takes such further actions as may be
reasonably required in order to carry out the provisions and purposes of this
Agreement.
IN WITNESS WHEREOF, the Corporation and VHI have executed this
Agreement as their free act and deed pursuant to valid authority.
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<S> <C>
WITNESS: FOREST HILL CAPITAL CORPORATION
/s/ JEFFREY KURTZ (SEAL)
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By: Jeffrey Kurtz
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Its: CHAIRMAN
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WITNESS: VALUE HOLDINGS, INC.
/s/ ANTHONY PALLANTE (SEAL)
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By: Anthony Pallante
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Its: PRESIDENT
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EXHIBIT 2
VALUE HOLDINGS, INC. AND SUBSIDIARIES
PRO-FORMA CONSOLIDATED BALANCE SHEET
(UNAUDITED)
<TABLE>
<CAPTION>
ASSETS
PRO-FORMA PRO-FORMA
MAY 31, ADJUSTMENTS MAY 31,
1996 CONVERSION 1996
BALANCE REFLECTING OF FOREST HILL REFLECTING
AUDIT ADJUSTMENTS NOTE RECEIVABLE CONVERSION
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<S> <C> <C> <C>
Current Assets
Cash $ 13,022 $ 13,022
Accounts receivable 11,025
Notes receivable
Virilite Neutracutical Corp., net of deferred gain of
$86,251 at May 31, and $172,502 at February 29 13,749 13,749
Other 121,314 121,314
Prepaid expenses and other assets 73,057 (45,824) ** 27,233
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232,167 186,343
Receivables from Stockholders 52,542 52,542
Investment in Affiliated Companies 283,987 1,656,250 1,940,237
Property and Equipment-Net of
accumulated depreciation 543,083 543,083
Cost in Excess of Net Assets
of Business Acquired 860,625 860,625
Intangible Assets 1,640,859 1,640,859
Note Receivable - Affiliate 770,426 (770,426) 0
Other Assets 40,448 40,448
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$ 4,424,137 $ 5,265,137
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LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Note payable other $ 43,500 $ 43,500
Notes payable, stockholders and directors 345,502 345,502
Accounts payable 583,061 583,061
Payroll and sales taxes payable 1,163,046 1,163,046
Accrued liabilities, other 209,403 209,403
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2,344,512 2,344,512
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Long Term Liability, Stockholder 287,875 287,875
Stockholders' Equity
Series A preferred stock par value $.0001,
20,000,000 shares authorized, 750,000 issued
and outstanding at May 31, 1996 and February 29,
1996 at liquidation value 750,000 750,000
Stock conversion rights 1,180,000 1,180,000
Common stock, par value $.0001, 180,000,000
shares authorized; issued and outstanding
51,206,068 and 44,206,068 at May 31, 1996 and
February 29, 1995 respectively 5,120 5,120
Note receivable affiliate (840,000) 840,000 0
Capital in excess of par 13,024,910 13,024,910
Deficit (12,324,888) (12,324,888)
Currency exchange (3,392) (3,392)
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1,791,750 2,631,750
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$ 4,424,137 $ 5,264,137
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</TABLE>
** Accrued interest on note receivable at 5/31/96.
Note: We would need to pick up 44.76% of Forest Hill's net income or loss
prospectively after conversion.
