SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. 2)
ELECTROCON INTERNATIONAL, INC.
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(Name of Issuer)
Common Stock, Par Value $.0001 Per Share
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(Title of Class of Securities)
285 296 20 8
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(CUSIP Number)
Mr. Judah Klausner
P.O. Box 181, Sagaponack, New York 11962
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(Name, Address and Telephone Number of Person Authorized to
Receive Notices and Communications)
October 14, 1999
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(Date of Event which Requires Filing of This Statement)
If the filing person has previously filed a statement on Schedule 13G to
report the acquisition which is the subject of this Schedule 13D, and is filing
this schedule because of Rule 13d-1(b)(3) or (4), check the following box [ ]
(Page 1 of 7 Pages)
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SCHEDULE 13D
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CUSIP NO. 285 296 20 8 PAGE 2 OF 7 PAGES
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1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Judah Klausner
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ]
(b) [X]
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3 SEC USE ONLY
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4 SOURCE OF FUNDS
00
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED [ ]
PURSUANT TO ITEMS 2(d) or 2(e)
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States
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7 SOLE VOTING POWER
763,558
--------------------------------------------------
8 SHARED VOTING POWER
NUMBER OF SHARES
BENEFICIALLY OWNED BY -0-
EACH REPORTING PERSON --------------------------------------------------
WITH 9 SOLE DISPOSITIVE POWER
763,558
--------------------------------------------------
10 SHARED DISPOSITIVE POWER
-0-
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
763,558
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [X]
Does not include 126,442 Shares for which Mr. Klausner disclaims
ownership. These Shares will be issued directly to the minority
shareholders of Visual Access Technologies, Inc. ("Visual Access").
Mr. Klausner is the sole director, officer and majority shareholder of
Visual Access.
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
9.3% Based on 8,175,420 shares of common stock outstanding after issuance
of 140,000 Shares, as reported by the Issuer in a Patent License Agreement
of which 46,692 Shares are being issued directly to minority shareholders
of Visual Access.
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14 TYPE OF REPORTING PERSON
IN
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<PAGE>
SCHEDULE 13D
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CUSIP NO. 285 296 20 8 PAGE 3 OF 7 PAGES
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1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Visual Access Technologies, Inc. ("Visual Access")
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ]
(b) [X]
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3 SEC USE ONLY
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4 SOURCE OF FUNDS
00
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED [ ]
PURSUANT TO ITEMS 2(d) or 2(e)
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
New York
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7 SOLE VOTING POWER
-0-
--------------------------------------------------
8 SHARED VOTING POWER
NUMBER OF SHARES
BENEFICIALLY OWNED BY 810,250
EACH REPORTING PERSON --------------------------------------------------
WITH 9 SOLE DISPOSITIVE POWER
-0-
--------------------------------------------------
10 SHARED DISPOSITIVE POWER
810,250
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
810,250
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [X]
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
9.9% Based on 8,175,420 shares of common stock outstanding after issuance
of 140,000 Shares as reported by the Issuer in a Patent License Agreement.
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14 TYPE OF REPORTING PERSON
CO
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<PAGE>
SCHEDULE 13D
CUSIP No. 285 296 20 8 Page 4 of 7 Pages
This Amendment No. 2 to the Schedule 13D is filed by Judah Klausner with
the Securities and Exchange Commission (the "SEC") as Amended by Amendment No. 1
filed on September 29, 1999.
This statement is being filed with the SEC by Judah Klausner and Visual
Access Technologies, Inc. (Judah Klausner and Visual Access sometimes referred
to as the "Reporting Persons") in accordance with the requirements of Rule 13d-1
promulgated by the SEC under the Securities Exchange Act of 1934, as amended
(the "Exchange Act"). As of the date of this filing, the Reporting Persons are
previously entitled to receive 140,000 Shares for which this amendment is being
filed. On October 14, 1999, the Issuer and Visual Access entered into a Patent
License Agreement whereby the Issuer agreed to issue 140,000 Shares to Visual
Access as partial consideration for the license. The 140,000 Shares have not yet
been issued. The Reporting Persons may be deemed to be the beneficial holders of
such 140,000 Shares. The Patent License Agreement also provides for the issuance
of up to an additional 60,000 Shares if the effect of the issuance of additional
shares of the Issuer would result in the Issuer having more than 8,200,000
Shares issued and outstanding at any time. Visual Access may also be deemed to
be the beneficial owner of the 670,250 Shares held by Mr. Klausner because of
Mr. Klausner's positions as the sole officer and director of Visual Access. At
the direction of Visual Access, the 140,000 Shares issuable pursuant to the
Patent License Agreement will be issued directly to the Shareholders of Visual
Access. After issuance of these 140,000 Shares to its shareholders, Visual
Access will cease to be the beneficial owner of any Shares of the Issuer. Mr.
Klausner disclaims ownership of the 46,692 Shares to be issued to the minority
shareholders of Visual Access.
Item 1. Security and Issuer.
-------------------
This Statement on Schedule 13D (the "Statement") relates to the shares of
common stock, par value $.0001 per share (the "Shares"), of Electrocon
International Inc., a British Virgin Islands Limited Liability International
Business Company (the "Issuer"). The address of the Issuer's principal executive
office is Prosperity Centre, 8/F, Block B, 77 Container Port Road, Kwai Chung,
New Territories, Hong Kong.
Item 2. Identity and Background.
-----------------------
This Amendment is filed by (i) Judah Klausner and (ii) Visual Access with
respect to 140,000 Shares presently issuable to Visual Access pursuant to a
Patent License Agreement and 670,250 Shares which Judah Klausner is the
beneficial holder. Visual Access may be deemed the beneficial holder of any
Shares which Mr. Klausner is the beneficial holder by virtue of Mr. Klausner's
control of Visual Access. Visual Access disclaims beneficial ownership of any
Shares held by Mr. Klausner in his own name and disclaims beneficial ownership
of the 126,442 Shares beneficially held by the minority shareholders of Visual
Access.
The principal business of Visual Access consists of holding, licensing and
exploiting certain patents for inventions of which Mr. Klausner is the inventor.
The principal business address of Visual Access is P.O. Box 181, Sagaponack, New
York 11962. Visual Access was incorporated in New York.
The President, Treasurer, Secretary, sole director and majority shareholder
of Visual Access is Judah Klausner. Mr. Klausner's business address is P.O. Box
181, Sagaponack, New York 11962. He is a citizen of the United States. Mr.
Klausner's principal occupation is that of an independent inventor.
Neither Mr. Klausner nor Visual Access has, during the last five years,
either been convicted in a criminal proceeding (excluding traffic violations or
similar misdemeanors) or been a party to a civil proceeding of a judicial or
administrative body of competent jurisdiction and as a result of such proceeding
was or is subject to
<PAGE>
SCHEDULE 13D
CUSIP No. 285 296 20 8 Page 5 of 7 Pages
a judgment, decree or final order enjoining future violations of, or prohibiting
or mandating activities subject to, federal or state securities laws or finding
any violation with respect to such laws.
Item 3. Source and Amount of Funds or Other Consideration
-------------------------------------------------
This amended Schedule 13D is being filed to report the acquisition of
beneficial ownership of 140,000 Shares issuable to Visual Access as partial
consideration pursuant to a Patent License Agreement. A copy of the Patent
License Agreement is attached hereto as Exhibit "A".
Item 4. Purpose of Transaction.
----------------------
Visual Access will acquire 140,000 Shares as partial consideration for the
licensing of one of its patents pursuant to a Patent License Agreement dated
October 14, 1999 and may receive an additional 60,000 Shares pursuant to a
provision of the Patent License Agreement.
Neither Visual Access nor Mr. Klausner has any present plans or proposals
which to the Reporting Person's knowledge relate to or would result in: (a) the
acquisition by any person of additional securities of the Issuer, or the
disposition of securities of the Issuer except as set forth in Item 6 herein;
(b) an extraordinary corporate transaction, such as a merger, reorganization or
liquidation, involving the Issuer or any of its subsidiaries; (c) a sale or
transfer of a material amount of assets of the Issuer or any of its
subsidiaries; (d) any changes in the present board of directors or management of
the Issuer, including any plans or proposals to change the number or term of
directors or to fill any existing vacancies on its board; (e) any material
change in the present capitalization or dividend policy of the Issuer; (f) any
other material change in the Issuer's business or corporate structure; (g) any
changes in the Issuer's charter, by-laws or instruments corresponding thereto or
other actions which may impede the acquisition of control of the Issuer by any
person; (h) causing a class of securities of the Issuer to be delisted from a
national securities exchange or to cease to be authorized to be quoted in an
inter-dealer quotation system of a registered national securities association;
(i) a class of equity securities of the Issuer becoming eligible for termination
of registration pursuant to Section 12(g)(4) of the Securities Exchange Act of
1934, as amended (the "Exchange Act"); or (j) any action similar to any of those
enumerated above.
Depending on circumstances, including general economic circumstances, then
existing, or circumstances disclosed by the Issuer in public releases or filings
with the Securities and Exchange Commission, Mr. Klausner reserves the right to
change his plans or proposals with respect to any of the foregoing subjects (a)
through (j), including his right to increase, decrease, or dispose of his
beneficial ownership of the Shares in the open market, through privately
negotiated transactions, or otherwise.
Item 5. Interest in the Securities of the Issuer.
----------------------------------------
Visual Access may be deemed to be the beneficial owner of an aggregate of
810,250 Shares. This represents 9.9% of the Issuer's outstanding shares<F1>.
Visual Access' holdings may be deemed to include: (i) the 670,250 Shares for
which Mr. Klausner is the beneficial holder and (ii) 140,000 Shares issuable to
it under the Patent License Agreement before such Shares are issued to the
shareholders of Visual Access. Visual Access may be deemed to have indirect
voting and dispositive power with respect to the 763,558 Shares held by Mr.
Klausner
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<F1> Based on 8,175,420 Shares outstanding after issuance of the
140,000 Shares, as reported by the Issuer in a Patent License Agreement. This
does not include the 60,000 Shares issuable to Visual Access if the Issuer's
issued and outstanding shares should increase to 8,200,000.
<PAGE>
SCHEDULE 13D
CUSIP No. 285 296 20 8 Page 6 of 7 Pages
by virtue of Mr. Klausner's ownership of such Shares and the 46,692 Shares to be
issued to other shareholders of Visual Access. Visual Access disclaims ownership
of these 810,250 Shares.
Mr. Klausner is the beneficial owner of 763,558 Shares which constitutes
9.3% of the outstanding Shares<F1>. Mr. Klausner has the sole power to vote or
to direct the vote and the sole power to dispose or to direct the disposition of
the Shares beneficially owned by him. Mr. Klausner disclaims beneficial
ownership of the 126,442 Shares beneficially owned by the minority shareholders
of Visual Access. Such minority shareholders are not controlled by or under
common control with Mr. Klausner.
Item 6. Contracts, Arrangements, Understandings or Relationships with Respect
to Securities of the Issuer.
----------------------------------------------------------------------
Pursuant to the Patent License Agreement, Visual Access is entitled to
receive an additional 60,000 Shares if at any time the Issuer has an aggregate
of 8,200,000 Shares issued and outstanding.
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<F1> Based on 8,175,420 Shares outstanding after issuance of the
140,000 Shares, as reported by the Issuer in a Patent License Agreement. This
does not include the 60,000 Shares issuable to Visual Access if the Issuer's
issued and outstanding shares should increase to 8,200,000.
<PAGE>
SCHEDULE 13D
CUSIP No. 285 296 20 8 Page 7 of 7 Pages
Item 7. Material to be Filed as Exhibits.
--------------------------------
Exhibit A. Patent License Agreement dated as of October 14, 1999 between
the Issuer and Visual Access.
SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, the
undersigned certifies that the information set forth in this statement with
respect to it is true, complete and correct.
Dated: October 26, 1999
By:/s/ Judah Klausner
-----------------------------
Judah Klausner
VISUAL ACCESS TECHNOLOGIES, INC.
By:/s/ Judah Klausner
-----------------------------
Judah Klausner, President
<PAGE>
EXHIBIT A
PATENT LICENSE AGREEMENT ON ASIC CHIPS FOR REMOTE ACCESS
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THIS AGREEMENT made by and between Visual Access Technologies, Inc. ("VAT")
a New York corporation having a principal office at P.O. Box 181, Sagaponack,
NY, hereafter referred to as "Licensor" and Electrocon International, Inc.
("Electrocon") having a principal office at Blk. B, 8/F, Prosperity Centre, 77
Container Port Road, Kwai Chung, N.T. Hong Kong, hereinafter referred to as
"Licensee" witnesseth that;
WHEREAS, Licensor is the owner of the entire right, title and interest in
and to an invention entitled, "Telephone Answering Device Linking Displayed Data
with Recorded Audio Message" covered by United States Letters Patents #5,390,236
and #5,572,576 and by all corresponding foreign patents and/or pending foreign
applications (the "Patents").
WHEREAS, Licensee is desirous of obtaining a license under said patent to
manufacture, use and sell Visual Access Application Specific Integrated Circuits
("ASIC") herein defined.
NOW THEREFORE, be it known that for and in consideration of the mutual
covenants and agreements hereinafter recited, the parties agree as follows:
Definitions
As used herein the following terms are defined as follows:
"Licensor" shall mean Visual Access Technologies, Inc. and any successor or
assignee to Licensor's patent rights.
"Licensee" shall mean Electrocon International, Inc.
"Licensor's Patent Rights" shall mean all of Licensor's rights under the
Patents.
"Licensed Invention" shall mean the invention as disclosed and claimed in
the Patents, and specifically limited to the use of ASIC as defined below.
<PAGE>
"ASIC" shall mean an integrated circuit programmed to perform the function
of remote retrieval of a displayed messaging page from a PC or server, allowing
for remote retrieval of voice, fax or e-mail.
Licenses
In consideration of the undertaking and covenants of Licensee as
hereinafter set forth, Licensor hereby grants to Licensee a non-exclusive
license to manufacture and sell ASICs which are intended to be embedded in such
devices as cell phones, PDA's, notebook computers and other portable and desktop
devices.
Nothing herein shall be deemed to create any rights or grant any license
direct or implied to any person, firm, corporation or entity, other than
Licensee. Nothing herein shall obligate Licensee to exploit or use the rights
licensed hereunder.
Initial Payment
Upon the signing of this agreement, Electrocon shall issue to VAT 140,000
COMMON SHARES. THE SHARES SHALL BE FULLY PAID AND NON-ASSESSABLE.
ELECTROCON HEREBY CERTIFIES THAT THERE ARE 8,035,420 SHARES OF COMMON STOCK
OUTSTANDING AS OF THE DATE OF THIS AGREEMENT SO THAT AFTER ISSUANCE OF THE
140,000 SHARES THE TOTAL OUTSTANDING SHALL BE 8,175,420.
Should additional shares be issued in Electrocon to any thirty party
subsequent to the issuance of the above 140,000, such that the total shares
outstanding would then exceed 8,200,000, then an additional 60,000 shares of
Electrocon shall immediately be issued to Visual Access Technologies, Inc.
Royalties
Licensee agrees to pay Licensor a flat royalty of $1.00 per ASIC sold. The
payment of such flat royalty on each ASIC will automatically license the
purchaser hereunder with respect to any end product in which the ASIC is
embedded.
2
<PAGE>
Accounts and Reporting
Licensee shall keep full and particular accounts of all licensed ASICs on
which royalty is payable, and within 30 days after the end of each calendar
quarter (beginning with the quarter ending January 1999) shall render to
Licensor a report certified by an officer of Licensee identifying by catalog or
style number, name, or other designation and briefly describing each category of
licensed ASICs shipped by Licensee and setting out the number of licensed ASICs
in each such category shipped by Licensee during the preceding calendar quarter
and the customer or consignee to which each shipment is made. Each such report
shall be accompanied by payment in full to Licensor of the royalty shown by the
report to be due.
Licensee shall permit Licensor or his duly designated representative at any
reasonable time to inspect or make copies or extracts from any books or records
of account maintained by Licensee in respect to the sale of licensed ASICs on
request of Licensor but not more frequently than two times each year to
ascertain the correctness of the reports rendered by Licensee. Neither Licensor
nor such representative shall not disclose to others any confidential
information received during such inspection.
Patent Marking
Licensee shall request from its customers that an appropriate patent
marking be affixed to each product in which an ASIC has been embedded.
Termination of License
Should any royalties payable hereunder remain unpaid for thirty (30) days
after the same shall become due and payable or should Licensee commit or suffer
a breach of any of the covenants herein contained and fail to remedy such breach
within thirty (30) days after written notice given by Licensor, or should
Licensee become insolvent or if formal proceedings shall be commenced to
administer Licensee's affairs or liquidate its assets, the Licensor may, by
written notice, terminate the license herein granted whereupon all right of
Licensee hereunder shall immediately cease. However, the termination of this
Agreement shall be without prejudice to the right of Licensor to receive any and
all royalties payable for licensed ASICs sold prior to termination. In the event
of termination as herein provided, Licensee shall have the right to sell
licensed ASICs which are in its possession as of the date of termination
provided that royalties are paid thereon.
3
<PAGE>
Licensor warrants and represents that Licensor has full power and the right
to grant the license provided herein under Licensor's Patent Rights.
Licensor does not guarantee or warrant the validity of any patent forming
part of the Licensor's patent rights and shall not be responsible for any losses
or damage incurred or maintained by Licensee arising out of the practice of the
invention covered by the Licensor's Patent Rights.
Licensee shall defend and indemnify Licensor from any claims for damage
brought against Licensor arising out of injury to person or property resulting
from the manufacture, use or sale by Licensee or use or sale by a third party of
ASICs manufactured or sold by Licensee.
Term
The Agreement will become effective upon signing by the last of the parties
to sign, and will continue in force until the expiration of the last of the
Patents.
Agreement Binding on Successors
This Agreement shall be binding upon and shall inure to the benefit of the
Licensor, personal representatives, successors and assignees. This Agreement is
personal to Licensee and may not be assigned or otherwise transferred except
with the prior written consent of Licensor.
This Agreement contains all of the terms and conditions agreed upon by the
parties hereto, and no other agreements, or otherwise, regarding the subject
matter of this Agreement shall be deemed to exist or bind any of the parties
hereto.
Interpretation; Disputes
The parties mutually agree that this Agreement shall be construed under the
laws of the State of New York. Any dispute or controversy arising under or in
connection with this Agreement shall be settled by arbitration to be held in the
city of New York before a panel consisting of three arbitrators. Each of the
Licensor and Licensee shall appoint one arbitrator and the two arbitrators so
appointed shall agree on the third arbitrator. Such arbitration shall be held in
accordance with the rules of the American Arbitration Association then in
effect. Judgment may be entered on the arbitrators' award in any court having
jurisdiction, and the parties consent to the jurisdiction of the courts of the
State of New York and the Federal courts located therein for that purpose.
4
<PAGE>
Address for Service
Written notices as herein provided shall be served on the parties at the
following addresses subject to change from time to time by written notice of the
other party.
Licensee:
Electrocon International, Inc.
Blk. B, 8/F, Prosperity Centre
77 Container Port Road
Kwai Chung, N.T. Hong Kong
Licensor:
Visual Access Technologies, Inc.
P.O. Box 181
Sagaponack, NY 11962
IN WITNESS WHEREOF, the parties hereto have set their hands and seals on the
respective dates shown below.
Electrocon International, Inc. Visual Access Technologies, Inc.
By:/s/ Edward Ting By:/s/ Judah Klausner
--------------------------- -----------------------------
Edward Ting Judah Klausner
President President
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Title Title
October 5, 1999 October 14, 1999
5
