SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8 KSB
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of
1934
June 15, 1998
(Date of Report)
CNH Holdings Company
(Exact name of registrant as specified in its charter)
Nevada
(State or other jurisdiction of incorporation)
0 17304 11 2867201
(Commission File Number) (IRS Employer Identification Number)
P.O. Box 832, Kilgore, Texas 75663
(Address of principal executive offices including zip code)
(903) 984 6425
(Registrant's telephone number including area code)
17659 Sun Meadow Drive, Dallas, Texas 75252
(Former name or former address, if changed since last report)
Item 1. Change in Control of Registrant.
On June 15, 1998, CNH Holdings Company, a Nevada corporation
(the Company), entered into a reorganization agreement (the
Reorganization Agreement) with Southport Environmental and
Development, Inc., a Nevada corporation (SEDI), and the
shareholders of SEDI pursuant to which the Company acquired all of
the outstanding proprietary interest of SEDI in a share for share
exchange which resulted in SEDI becoming a wholly owned subsidiary
of the Company and the shareholders of SEDI acquiring control of
the Company through their share ownership. The Company issued
6,000,000 common shares and 200,000 shares of the Class A: 10%
Dividend Bearing Preferred Stock of the Company. Pursuant to the
Reorganization Agreement, the existing director, Mr. Paul M.
Lionti, resigned and the Company appointed Messrs. Larry V. Tate,
Gerald Pybas, H. Paul Estey, E. Robert Barbee and Terry McFarland
as directors. Mr. Tate was then appointed CEO, Mr. Pybas
President, and Ms. Helen Wallace Treasurer. Mr. Mark S. Pierce
remains as Secretary.
Southport owns and/or operates working and other interests in oil
and gas properties in east Texas and also has a 1/3rd interest in
NSG, a joint venture involved in the remediation of normally
occurring readioactive materials along the gulf coast of Texas and
Louisiana.
The Company, also effective June 15, 1998, entered into a recision
agreement with DRC, Inc., and GNC Corporation whereby the Company
and these entities rescinded their previous purchase agreement due
to the failure of GNC to comply with the terms and provisions of
the purchase agreement. Each of the parties bore their own costs
and expenses and released one another from any and all liabilities.
Item 2. Acquisition or Disposition of Assets: See Item 1, above.
Item 3. Bankruptcy or Receivership: Not Applicable.
Item 4. Changes in Registrant's Certifying Accountant: Not
Applicable.
Item. 5. Other Events: None.
Item 6. Resignation of Registrant's Directors: Not Applicable.
Item 7. Financial Statements, Pro Forma Financial Information and
Exhibits: Not Applicable.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, as amended, Registrant has duly caused this report to be
signed on its behalf by the undersigned hereunto duly authorized.
CNH HOLDINGS COMPANY
(Registrant)
By: /s/ Paul M. Lionti
Paul M. Lionti, Chief Executive Officer
Date: June 15, 1998
EXHIBITS
Exhibit 1. Agreement of Purchase
Exhibit 2. Series A Preferred Stock
Exhibit 3. Recission Agreement
EXHIBIT No. 1
AGREEMENT OF PURCHASE
This plan and agreement of purchase (Plan) has been adopted as a
reorganization under Section 368(b) of the Internal Revenue Code
and has been entered into in Dallas, Texas, this 15th day of June,
1998 (Closing Date), between CNH Holdings, Inc., a Nevada
corporation sometimes referred to in this Agreement as either the
Purchaser or CNH, Southport Environmental and Development, Inc., a
Texas corporation sometimes referred to in this Agreement as either
the Acquired Corporation or SEDI and the shareholders of the
Acquired Corporation, all of whom are sometimes collectively
referred to in this Agreement as the Shareholders.
The Purchaser hereby acquires from the Shareholders all of issued
and outstanding capital stock of the Acquired Corporation in
exchange solely for shares of voting stock of the Purchaser. Under
this Plan, the Acquired Corporation has become a wholly owned
subsidiary of CNH.
ARTICLE I
EXCHANGE OF VOTING CAPITAL STOCK
1.01. Transfer and Delivery of SEDI Shares. Shareholders hereby
transfer and deliver to Purchaser certificates evidencing all of
the issued and outstanding capital stock of SEDI duly endorsed in
blank so as to result in transfer upon delivery.
1.02. Issuance and Delivery of CNH Shares. In exchange for the
transfer by Shareholders to Purchaser of all of the issued and
outstanding Acquired Corporation capital shares hereunder,
Purchaser has (I) issued and delivered to Shareholders 6,000,000
restricted common shares of CNH (the CNH Shares), and (ii) 200,000
shares of Class A Preferred Stock.
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF SHAREHOLDERS AND ACQUIRED
CORPORATION
2.01. Organization and Standing. SEDI is a corporation duly
organized, validly existing and in good standing under the laws of
Texas, with all corporate powers to own property and carry on its
business as it is now being conducted. Copies of the articles of
incorporation of SEDI delivered to Purchaser herewith are complete
and accurate as of the Closing Date. SEDI is qualified to transact
business as a foreign corporation and is in good standing in all
jurisdictions in which its principal properties are located or is
not required to be qualified as a foreign corporation to transact
business in any other jurisdiction.
2.02. Balance Sheet. A balance sheet and related statements of
operations, cash flows and equity dated as of and for the three
year or lesser period, if inception occurred within three years,
ended December 31, 1997 (Balance Sheet), shall forthwith be
delivered. The Purchaser and SEDI shall cause the delivery of
these financial statements (i) audited in accordance with Generally
Accepted Auditing Standards, (ii) prepared in accordance with
Generally Accepted Accounting Principles applied on a consistent
basis and fairly presenting the financial position of SEDI and
(iii) complying with Regulation S X and Form 8 KSB within 75 days
after the Closing Date.
2.03. Capitalization. SEDI has an outstanding capitalization
which is all in the hands of the Shareholders, all of which are
fully paid and non assessable. There are no outstanding
subscriptions, options, contracts, commitments or demands relating
to the capital stock of SEDI or any other agreements of any
character under which SEDI or the Shareholders would be obligated
to issue or purchase shares of its capital stock.
2.04. Title to Assets. Acquired Corporation has good and
marketable title to all of its assets, all as set forth in the
Balance Sheet, none of which are subject to any mortgage, pledge,
lien, charge, security interest, encumbrance or restriction
whatsoever except those that: (a) are disclosed on the Balance
Sheet and/or the footnotes thereto or (b) do not materially and
adversely affect the use of the asset. Further, the assets of SEDI
are in good condition and repair, except for reasonable wear and
tear.
2.05. Schedule of Assets. Acquired Corporation shall forthwith
deliver to Purchaser a separate schedule of assets, specifically
referring to this paragraph, containing, as of the Closing Date, a
true and complete: (a) legal description of all real property owned
by SEDI and any real property in which SEDI has a leasehold
interest, including working interests, (b) list of all capitalized
machinery, tools, and equipment of SEDI that sets forth any liens,
claims, encumbrances, charges, restrictions, covenants and
conditions concerning the listed items, (c) list of all machinery,
tools, and equipment in which SEDI has a leasehold interest, with
a description of each interest, (d) list of all patents, patent
licenses, trademarks, trademark registrations, trade names,
copyrights and copyright registrations owned by SEDI, and (f) list
of all interests in subsidiaries and/or joint ventures, including,
without limitation, NSG.
2.06. Liabilities. Except as set forth in the Balance Sheet, SEDI
presently has no outstanding indebtedness other than liabilities
incurred in the ordinary course of business or in connection with
the Plan. SEDI is not in default with respect to any terms or
conditions of any indebtedness. Further, SEDI has not made any
assignment for the benefit of creditors, nor has any involuntary or
voluntary petition in bankruptcy been filed by or against SEDI.
2.07. Litigation. SEDI is not a party to, nor has it been
threatened with, any litigation or governmental proceeding that, if
decided adversely to it, would have a material and adverse effect
on the Plan, or on the financial condition, net worth, prospects or
business of SEDI. To the best of the Acquired Corporation's
knowledge, it is not aware of any facts that might result in any
action, suit or other proceeding that would result in any material
and adverse change in the business or financial condition of SEDI.
2.08. Compliance with Law and Instruments. The business and
operations of SEDI are not infringing on or otherwise acting
adversely to any copyrights, trademark rights, patent rights or
licenses owned by any other person, and there is not any pending
claim or threatened action with respect to such rights. SEDI is
not obligated to make any payments in the form of royalties, fees
or otherwise to any owner of any patent, trademark, trade name or
copyright.
2.09. Contractual Obligations. SEDI is not a party to or bound by
any written or oral: (a) contract not made in the ordinary course
of business, (b) contract with any labor union other than in the
ordinary course of business, (c) bonus, pension, profit sharing,
retirement, stock option, hospitalization, group insurance or
similar plan providing employee benefits other than in the ordinary
course of business, (d) any real or personal property lease other
than in the ordinary course of business, (e) advertising contract
or contract for public relations services other than in the
ordinary course of business, (f) purchase, supply or service
contracts in excess of $10,000 each or in the aggregate of $100,000
for all such contracts other than in the ordinary course of
business, (g) deed of trust, mortgage, conditional sales contract,
security agreement, pledge agreement, trust receipt or any other
agreement subjecting any of the assets or properties of SEDI to a
lien, encumbrance or other restriction other than in the ordinary
course of business, (h) term contract continuing for a period of
more than one year that is not terminable at will without liability
to SEDI or its successors other than in the ordinary course of
business, or (i) a contract that contains a predetermination of
price or similar type of provision, or which provides for a fixed
price for goods or services sold. SEDI has performed all
obligations required to be performed by it to the Closing Date and
is not in material default under any of the contracts, leases or
other arrangements by which it is bound. None of the parties with
whom SEDI has contractual arrangements are in default of their
obligations.
2.10. Changes in Compensation. Since the date of the Balance
sheet, SEDI has not granted any general pay increase to employees
or changed the rate of compensation, commission or bonus payable to
any officer, employee, director, agent or stockholder other than in
the normal course of business.
2.11. Records. All of the account books, minute books, stock
certificate books and stock transfer ledgers of SEDI are complete
and accurate.
2.12. Authority. The execution and performance of this Agreement
have been duly authorized by all requisite corporate action. This
Agreement constitutes a valid and binding obligation of SEDI and
Shareholders in accordance with its terms. No provision of the
articles of incorporation, bylaws, minutes, share certificates or
contracts prevents SEDI and Shareholders from delivering its shares
of common stock in the manner contemplated under the Plan.
2.13. Taxes. SEDI has filed all income tax returns and, in each
jurisdiction where qualified or incorporated, all income tax and
franchise tax returns that are required to be filed. SEDI has paid
all taxes as shown on the returns as have become due, and has paid
all assessments received that have become due.
2.14. Brokers. All negotiations on the part of Acquired
Corporation and Shareholders related to the Plan have been
accomplished solely by Acquired Corporation and Shareholders
without the assistance of any person employed as a broker or
finder. Acquired Corporation and Shareholder have done nothing to
give rise to any valid claims for a broker's commission, finder's
fee or any similar charge.
2.15. Full Disclosure. As of the Closing Date, SEDI and
Shareholders have disclosed all events, conditions and facts
materially affecting the business and prospects of SEDI.
Shareholders and SEDI have not withed knowledge of any event,
condition or fact that they have reasonable grounds to know may
materially affect the business and prospects of SEDI. None of the
representations and warranties made by Shareholders or SEDI in this
Agreement or in any other instrument furnished to Purchaser
contains any untrue statement of a material fact, or fails to state
a material fact.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF PURCHASER
3.01. Organization and Standing. CNH is a corporation duly
organized, validly existing and in good standing under the laws of
Nevada, with corporate powers to own property and carry on its
business as it is now being conducted. Copies of the articles of
incorporation of CNH delivered to Shareholders and SEDI herewith
are complete and accurate as of the Closing Date. CNH is qualified
to transact business as a foreign corporation and is in good
standing in all jurisdictions in which its principal properties are
located or is not required to be qualified as a foreign corporation
to transact business in any other jurisdiction.
3.02. Subsidiaries. CNH has no subsidiaries.
3.03. Capitalization. CNH has an authorized capitalization
consisting of 10,000,000 common shares, $.001 par value per share,
and 1,000,000 preferred shares, $.01 par value per share. As of
the Closing Date, the number of common shares outstanding is as set
forth in the Form 10 QSB as of and for the nine month period ended
December 31, 1997, and, as of the Closing Date, no preferred shares
are issued and outstanding, all of which issued and outstanding
shares are fully paid and non assessable. There are no outstanding
warrants, options, contracts, calls, commitments or demands
relating to the unissued securities of CNH, other than as required
herein.
3.04. Due Delivery. The CNH Shares issued to Shareholders have
been validly authorized and issued and are fully paid and non
assessable. No CNH shareholder has any preemptive right of
subscription or purchase with respect to these shares.
3.05. Authority. The execution and performance of this Agreement
have been duly authorized by all requisite corporate action. This
Agreement constitutes a valid and binding obligation of CNH in
accordance with its terms. No provision of the articles of
incorporation, bylaws, minutes, share certificates or contracts
prevents CNH from delivering its shares of common stock in the
manner contemplated under the Plan.
3.06. Brokers. All negotiations on the part of CNH related to the
Plan have been accomplished solely by CNH without the assistance of
any person employed as a broker or finder. CNH has done nothing to
give rise to any valid claims for a broker's commission, finder's
fee or any similar charge.
3.07. Full Disclosure. As of the Closing Date, CNH has disclosed
all events, conditions and facts materially affecting the business
and prospects of CNH, and CNH has not withed knowledge of any
event, condition or fact that it has reasonable grounds to know may
materially affect the business and prospects of CNH. None of the
representations and warranties made by CNH in this Agreement or in
any other instrument furnished to Shareholders or SEDI contains any
untrue statement of a material fact, or fails to state a material
fact.
ARTICLE IV
SURVIVAL OF WARRANTIES AND WARRANTIES
4.01. Nature and Survival of Representations and Warranties. All
statements of fact contained in this Agreement or in any
memorandum, certificate, letter, document or other instrument
delivered by or on behalf of any of the parties hereto to any other
party pursuant to this Agreement shall be deemed representations
and warranties made by the delivering party to the other parties
under this Agreement. The covenants, representations and
warranties of the parties shall survive the Closing Date for a
period of one year, and then they shall lapse and be of no further
effect.
4.02. Expenses. The parties to this Agreement shall pay their own
expenses incurred hereunder and in regards of the transactions
contemplated hereby, including, but not limited to, all fees and
expenses of their respective counsel and accountants.
ARTICLE V
COMPLIANCE WITH SECURITIES LAWS
5.01. Acknowledgments of Shareholders. Shareholders acknowledge,
understand and agree that: (a) The certificates representing the
CNH Shares will bear a legend restricting transfer in accordance
with the exemption from registration under the Securities Act of
1933, as amended. (b) The CNH Shares have not been registered
under the Securities Act of 1933, as amended, or any applicable
state law (collectively, the Securities Act); further, the CNH
Shares may not be sold, offered for sale, transferred, pledged,
hypothecated or otherwise disposed of except in compliance with the
Securities Act; and, further, the legal consequences of the
foregoing mean that Shareholders must bear the economic risk of the
investment in the CNH Shares for the requisite period of time. (c)
No federal or state agency has made any finding or determination as
to the fairness of an investment in CNH, or any recommendation or
endorsement of this investment.
5.02. Further Representations and Warranties of Shareholders.
Shareholders each individually represent and warrant to CNH as
follows: (a) I have the financial ability to bear the economic
risks of my investment, have adequate means of providing for my
current needs and personal contingencies, and have no need for
liquidity in this investment; and, further, I have evaluated the
high risks of investing in CNH and have such knowledge and
experience in financial and business matters in general and in
particular with respect to this type of investment that I am
capable of evaluating the merits and risks of any investment in the
CNH Shares. (b) I have been given the opportunity to ask questions
of and receive answers from CNH concerning the terms and conditions
of this investment, and to obtain additional information necessary
to verify the accuracy of the information I desired in order to
evaluate my investment, and in evaluating the suitability of this
investment I have not relied upon any representations or other
information (whether oral or written), other than that furnished to
me by CNH or its representatives; further, I have had the
opportunity to discuss with my professional, legal, tax and
financial advisers the suitability of an investment in the CNH
Shares for my particular tax and financial situation; and, further,
in making the decision to purchase the CNH Shares, I have relied
solely upon independent investigations made by me or on my behalf.
(c) I am acquiring the CNH Shares solely for my own personal
account, for investment purposes only, and am not purchasing with
a view to, or for, the resale, distribution, subdivision or
fractionalization thereof.
ARTICLE VI
MISCELLANEOUS
6.01. Amendments. This Agreement may be amended or modified at
any time and in any manner only by an instrument in writing
executed by the Presidents of SEDI and CNH and by the Shareholders.
6.02. Waiver. The Shareholders, SEDI and/or CNH may, in writing,
(a) extend the time for performance of any of the obligations of
any other party to this Agreement, (b) waive any inaccuracies or
misrepresentations contained in this Agreement or any document
delivered pursuant to this Agreement by any other party and/or (c)
waive compliance with any of the covenants, or performance of any
obligations, contained in this Agreement by any other party.
6.03. Assignment. (a) Neither this Agreement nor any right
created hereby shall be assignable by any party without the prior
written consent of the other parties, except by the laws of
succession. (b) Except as limited by subparagraph (a), this
Agreement shall be binding on and inure to the benefit of the
respective successors and assigns of the parties. Nothing in
this Agreement, expressed or implied, is intended to confer upon
any person, other than the parties and their permitted successors,
any rights or remedies under this Agreement.
6.04. Notices. Any notice or other communication required or
permitted by this Agreement must be in writing and shall be deemed
to be properly given when delivered in person to an officer of the
other party, when deposited in the U.S. mails for transmittal by
certified or registered mail, postage prepaid, or when deposited
with a public telegraph company for transmittal, charges prepaid,
provided that the communication is addressed as follows: (a) in
case of SEDI and the Shareholders: P.O. Box 832, Kilgore, Texas
75663; FAX: (903) 984 8296; and (b) in case of CNH: 1999 Broadway,
Ste. 3235, Denver, CO 80202; FAX (303) 292 2882.
6.05. Headings. Paragraph and other headings contained in this
Agreement are for reference purposes only and shall not affect in
any way the meaning or interpretation of this Agreement.
6.06. Entire Agreement. This Agreement contains the entire
agreement between the parties relating to the subject matter
hereof. It may be executed in any number of counterparts, but the
aggregate of such counterparts constitute only one and the same
instrument.
6.07. Partial Invalidity. In the event that any one or more of
the provisions contained in this Agreement shall for any reason be
held to be invalid, illegal or unenforceable in any respect, such
invalidity, illegality or unenforceability shall not affect any
other provision of this Agreement, but this Agreement shall be
construed as if it never contained any such invalid, illegal or
unenforceable provisions.
6.08. Controlling Law. The validity, interpretation and
performance of this Agreement shall be controlled by and construed
under the laws of the State of Texas.
6.09. Attorney's Fees. If any action at law or in equity,
including any action for declaratory relief, is brought to enforce
or interpret the provisions of this Agreement, the prevailing party
shall be entitled to recover reasonable attorney's fees from the
other party. The attorney's fees may be ordered by the court in
the trial of any action described in this paragraph or may be
enforced in a separate action brought for determining attorney's
fees.
6.10. Specific Performance. The parties declare that it is
impossible to measure in money the damages that will accrue to a
party or its successors as a result of any other parties' failure
to perform any of the obligations under this Agreement. Therefore,
if a party or its successor institutes any action or proceeding to
enforce the provisions of this Agreement, any party opposing such
action or proceeding agrees that specific performance may be sought
and obtained for any breach of this Agreement.
Purchaser: CNH Holdings, Inc.:
By: /s/ Paul M. Lionti
Paul M. Lionti, President
Acquired Corporation: Southport Environmental and Development,
Inc.:
By: /s/ Larry V. Tate
Larry V. Tate, President
Shareholders:
/s/ Larry V. Tate
Larry V. Tate
s/ Gerald Pybas
Gerald Pybas
EXHIBIT No. 2
SERIES A: 10% DIVIDEND BEARING PREFERRED STOCK
CERTIFICATE SETTING FORTH RESOLUTIONS
BY THE BOARD OF DIRECTORS FOR CNH HOLDINGS COMPANY, INC.
(Pursuant to the Nevada Corporation Code)
We, the undersigned, as the President and Secretary of CNH Holdings
Company, Inc., a Nevada corporation, the Articles of Incorporation
of which are on file in the office of the Secretary of State for
the State of Nevada DO EACH HEREBY CERTIFY AND VERIFY: that the
Board of Directors of CNH Holdings Company, Inc., in accordance
with said articles and pursuant to the laws of the State of Nevada,
duly adopted on June 15, 1998, the preambles and resolutions
attached hereto.
IN WITNESS WHEREOF: We have set our hands and the corporate seal
this 15th day of June, 1998.
CNH HOLDINGS COMPANY, INC.
By: /s/ Paul M. Lionti
Paul M. Lionti, President [SEAL]
Attest: /s/ Mark S. Pierce
Mark S. Pierce, Secretary
UNANIMOUS CONSENT IN LIEU OF SPECIAL MEETING
BOARD OF DIRECTORS
FOR
CNH HOLDINGS COMPANY, INC.
(June 15, 1998)
Pursuant to the provisions of the Nevada Corporation Code which
provide that action required or permitted by said code to be taken
at a meeting of the board of directors of a corporation may be
taken without a meeting with the same force and effect as a
unanimous vote of said board if the action is (I) evidenced by one
or more written consents describing the action taken, (ii) signed
by each director and (iii) delivered to the secretary of the
corporation for filing with the corporate records the undersigned,
being the sole members of the board of directors of CNH Holdings
Company, Inc., (the Board of Directors and the Company,
respectively), do hereby waive any and all notice which may be
required to be given with respect to a meeting of the Board of
Directors and do hereby take, ratify, confirm and approve the
following action this 15th day of June, 1998.
WHEREAS, the Company has been presented with an opportunity to
acquire as a wholly owned subsidiary Southport Environmental and
Development, Inc. a Texas corporation (Southport); WHEREAS, the
Company has been presented with a proposed Plan and Agreement of
Purchase (the Southport Purchase Agreement) by and between the
Company, Southport and the shareholders (Shareholders) of
Southport; WHEREAS, the Southport Purchase Agreement requires the
delivery to the Shareholders of 6,000,000 shares of the common
stock of the Company and 200,000 shares of a series of preferred
stock in order to consummate said agreement; WHEREAS, the
execution and delivery of, and performance under, the Southport
Purchase Agreement and the delivery of the common and preferred
shares thereunder is in the best interests of the Company; WHEREAS,
the Articles of Incorporation governing the Company (the Articles
of Incorporation) permit the issuance of preferred shares in series
with such designations, preferences and relative participating
option or other rights and qualifications, limitations and
restrictions as may be fixed by the Board of Directors, including,
without limitation, the rate of dividends and redemption and
conversion prices, all of which are to be determined after giving
consideration to the financial and general condition of the Company
and to the condition of the securities' markets, if any, existing
at the time of issuance; and WHEREAS, the directors deem it
advisable to establish and issue a new series of preferred stock at
this time to accomplish the consummation of the Southport Purchase
Agreement and have carefully investigated the financial and general
condition of the Company and the relation of the condition of the
Company to the condition of the securities markets, and have
determined that it is in the best interests of the Company to
establish a new series of preferred stock to be denominated Series
A: Voting, Convertible Preferred Stock with the attributes set
forth in this resolution and to forthwith deliver a certificate
evidencing the same to the Shareholders:
NOW, THEREFORE, BE IT RESOLVED, that the Board of Directors
authorizes Corporate Stock Transfer to issue 6,000,000 restricted
common shares of the Company to the Shareholders in partial
consummation of the Southport Purchase Agreement; RESOLVED, that
Mr. Mark S. Pierce shall instruct Corporate Stock Transfer in the
number and name of the Shareholders to whom the aforesaid shares
shall be issued; RESOLVED, that the Board of Directors hereby
authorizes the Company to issue for the purpose of consummating the
Southport Purchase Agreement Two Hundred Thousand (200,000) shares
of its Series A: 10% Dividend Bearing Preferred Stock at a price of
$20 per share, which series shall have the following features: (a)
Dividends the series shall pay a dividend of 10% per annum
computed and accrued quarterly in arrears, to be declared and paid
only when the Board of Directors deems such to be in the best
interests of the Company; (b) Conversion the series shall not be
convertible into any other securities of the Company; (c)
Redemption neither the Company nor any one else shall have any
right to redeem the shares of this series at any time; (d)
Liquidation Preference the holders of the series shall be entitled
to a liquidation preference over any existing or subsequently
established class or series of outstanding stock of the Company in
the amount of $20 per share plus all accrued and unpaid dividends;
(e) Sinking Fund the holders of this series shall not be entitled
to the establishment of any sinking fund for the purpose or
retiring the shares of the series or for any other purpose; (f)
Voting Rights the series shall have no voting rights other than
those provided under Nevada law; (g) Additional Provision the
series shall be issued, upon compliance with the laws of the State
of Nevada, in accordance with those terms set forth on Exhibit A
hereto, which is specifically incorporated herein by this reference
and adopted as the act of the Company; RESOLVED FURTHER that the
President and the Secretary are hereby authorized and directed to
cause to be filed under corporate seal such certificates as shall
be requisite to the end that the stock shall be issued and
delivered to the Shareholders as aforesaid; and RESOLVED FINALLY
that the President be, and he hereby is, authorized to (i)
effectuate, to the extent necessary and appropriate, those actions
taken hereby, (ii) issue a certificate or certificates for the
shares, (iii) prepare a form of certificate for the shares in
accordance with the above resolutions and (iv) provide for filing
all necessary documentation with the Secretary of State for the
State of Nevada, applicable state securities authorities and the
United States Securities and Exchange Commission.
IN WITNESS WHEREOF, the undersigned, being the sole member of the
Board of Directors, have hereunto set their hands effective as of
the date first specified above.
/s/ Paul M. Lionti
Paul M. Lionti, Director
EXHIBIT A
SERIES A: 10% DIVIDEND BEARING PREFERRED STOCK PROVISIONS
The Series A 10% Dividend Bearing Preferred Stock (the Preferred
Stock or the Series A Preferred Stock) shall consist of one (1)
series of Two Hundred Thousand (200,000) shares of the preferred
stock of CNH Holdings Company, Inc., (the Company), with each share
to be identical to every other in all respects. The following sets
forth the provisions of the Series A Preferred Stock.
Part 1: Dividends: The holders of the issued and outstanding
Preferred Stock shall be entitled to receive quarterly in arrears,
as and when declared by the Board of Directors, dividends amounting
to 10% of the liquidation value on the Preferred Stock. If a
dividend is not paid, it shall accrue and be compounded into the
liquidation value of the Preferred Stock.
Part 2: Conversion: The holders of the Preferred Stock shall have
no conversion rights.
Part 3: Redemption: No one, including the Company, shall be
entitled to redeem the Preferred Stock under any circumstances at
any time.
Part 4: Liquidation: The Preferred Stock shall not entitled to
preferential liquidation rights over any other class or series of
stock previously or which may subsequently be issued by the Company
in the amount of $20, plus accrued and unpaid dividends.
Part 5: Sinking Fund: The Preferred Stock shall not be entitled to
the establishment of any sinking fund for any purpose.
Part 6: Voting Rights: The Preferred Stock shall have no voting
rights.
Part 7: Additional Provisions: The Preferred Stock may not be
subordinated in any respect to the terms and provisions of the
Common Stock and to the terms and provisions of any other series of
the outstanding preferred stock of the Company which may be issued
and become outstanding subsequent to the Preferred Stock.
EXHIBIT No. 3:
RECISION AGREEMENT
THIS AGREEMENT, made and entered into this 15th day of June, 1998,
to be effective as of the 9th day of December, 1997, by and between
CNH Holdings, Inc., a Nevada corporation (CNH), DRC, Inc., a Nevada
corporation (DRC), and GNC Corporation, a Nevada corporation (GNC),
WITNESSETH:
WHEREAS, CNH, DRC and GNC were each previously involved in certain
transactions that were consummated on December 9, 1997, under an
Agreement of Purchase (the Purchase Agreement) pursuant to which
CNH acquired all of the outstanding proprietary interest of GNC
from DRC (the GNC Shares) in exchange for 2,500,000 common shares
of CNH (the CNH Shares); WHEREAS, said transactions have given
rise to a right of recision of the Purchase Agreement between CNH,
DRC and GNC under the Securities Act of 1933, as amended (the
Securities Act), which allows for the return of the GNC and CNH
Shares to their original owners prior to the execution and delivery
of the Purchase Agreement; WHEREAS, the parties have agreed to
compromise their claims against one another hereunder; and
WHEREAS, the transactions set forth herein are in the respective
best interests of CNH, DRC and GNC; NOW, THEREFORE, based upon the
above and foregoing premises, and such other and further
consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties agree as follows:
ARTICLE I
RESCISSION
1.1. Rescission. CNH hereby rescinds the Purchase Agreement and
its purchase of the GNC Shares from DRC and GNC effective December
9, 1997. DRC and GNC hereby accept the surrender of the GNC Shares
to them effective December 9, 1997. DRC and GNC hereby rescind the
Purchase Agreement and their purchase of the CNH Shares from CNH
effective December 9, 1997. CNH hereby accepts the surrender of
the CNH Shares to it effective December 9, 1997. CNH, GNC and DRC
shall forthwith execute any and all additional documents as may be
reasonably requested by any other party hereto to provide for the
effective transfer of the shares being surrendered hereunder.
1.2. Mutual General Releases between CNH, DRC and GNC. Upon
execution and delivery hereof, CNH, DRC and GNC (for themselves and
their successors and assigns) do each forever acquit, remise,
release and forever discharge each other and their respective
directors, officers, employees, shareholders, servants, agents,
successors, affiliates and assigns from and against any and all
claims, demands, rights and causes of action of any kind or nature
whatsoever, whether now known or which may subsequently accrue, and
whether such relates to the Purchase Agreement, the purchase of the
CNH and GNC Shares or otherwise.
ARTICLE II
REPRESENTATIONS, WARRANTIES AND DISCLAIMER
2.1. Representations and Warranties of CNH. CNH hereby represents
and warrants to DRC and GNC as follows:
a. All necessary action has been taken to make this Agreement a
legal, valid and binding obligation of CNH enforceable in
accordance with its terms and conditions. b. The execution and
delivery of this Agreement and the performance by CNH of its
obligations hereunder will not result in any material breach or
violation of or material default under any material agreement,
indenture, lease, license, mortgage, instrument, or understanding,
nor result in any violation of any law, rule, regulation, statute,
order or decree of any kind to which CNH is a party.
2.2. Representations and Warranties of DRC and GNC. DRC and GNC
each represent and warrant, jointly and severally, to CNH as
follows:
a. All necessary action has been taken to make this Agreement a
legal, valid and binding obligation of DRC and GNC enforceable in
accordance with its terms and conditions. b. The execution and
delivery of this Agreement, and the performance by DRC and GNC of
their respective obligations hereunder will not result in any
material breach or violation of or material default under any
material agreement, indenture, lease, license, mortgage,
instrument, or understanding, nor result in any violation of any
law, rule, regulation, statute, order or decree of any kind to
which DRC and GNC is or are a party.
ARTICLE III
INDEMNITY
CNH, DRC and GNC shall each indemnify, save, defend and hold every
other party hereto harmless from and against any and all damage,
loss, cost or expense (including reasonable attorneys' fees)
arising from any breach of this Agreement caused by any breach of
any representation or warranty or failure in covenant on its part
set forth herein or the untruth or inaccuracy thereof. CNH, DRC
and GNC shall, jointly and severally and at their own expense,
defend every other party hereto from and against any and all claims
resulting hereunder from its own act or omission with counsel
reasonably satisfactory to the other party or parties; provided,
however, that the defending party or parties shall allow the
non-defending party or parties to participate in any such action to
the extent such participation is reasonable and the defending party
or parties deems it appropriate; provided, further, that the
defending party or parties shall not agree to the settlement of any
such action without the prior written consent of the non-defending
party or parties, which consent shall not be unreasonably withheld.
ARTICLE IV
MISCELLANEOUS
4.1. Entire Agreement; Modification. This Agreement sets forth
and constitutes the entire agreement between the parties hereto
with respect to transactions set forth herein, and supersedes any
and all prior agreements, understandings, promises, and
representations made by any party to any other party concerning the
subject matter hereof and the terms applicable thereto. This
Agreement may not be released, discharged, amended or modified in
any manner except by an instrument in writing signed by duly
authorized representatives of the parties hereto.
4.2. Governing Law. This Agreement shall be deemed to have been
entered into and shall be construed and enforced in accordance with
the laws of the State of Nevada.
4.3. Counterparts. This Agreement may be executed in any number
of counterparts, each of which shall be an original, but such
counterparts shall together constitute one and the same instrument.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed as of the date first above written.
CNH HOLDINGS, INC.
By: /s/Authorized Representative
DRC, INC.
By: /s/Authorized Representative
GNC CORPORATION
By: /s/Authorized Representative
