As filed with the Securities and Exchange Commission on August 30, 1996.
Registration No. 33-________________
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------------
FORM S-8
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
----------------------
WORLD WIDE STONE CORPORATION
(Exact name of registrant as specified in its charter)
Nevada 33-0297934
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
2150 West University Drive, Tempe, Arizona 85281, 602/966-0047
(Address and telephone number of principal executive offices)
Consulting Agreement between World Wide Stone Corporation
and La Costa Financial Corporation
(full title of plan)
----------------------
Frank E. Cunningham, President
2150 West University Drive, Tempe, Arizona 85281
602/966-0047
(Name, address and telephone number of agent for service)
Copies to:
James M. Cassidy, Esq.
Cassidy & Associates
1504 R Street, N.W.
Washington, D.C. 20009
202/387-5400
If any of the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933 check the following box: [ X ]
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
==================================================================================================================================
Proposed Maximum Proposed Maximum Amount of
Title of Securities Amount to be Offering Price per Aggregate Offering Registration
to be Registered Registered Share Price Fee (1)
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, 5,000,000 $0.50 $2,500,000 $ 862
$.001 par value shares(2)
==================================================================================================================================
</TABLE>
(1) Calculated in accordance with Rule 457(h) under the Securities Act of
1933, as amended (the "Securities Act"), based on the average of the
closing bid and asked prices of $0.50 for August 21, 1996.
(2) Pursuant to Rule 416 under the Securities Act, this Registration
Statement also covers an indeterminate number of shares as may be
required by reason of any stock dividend, recapitalization, stock
split, reorganization, merger, consolidation, combination or exchange
of shares or other similar change affecting the Common Stock.
<PAGE>
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
WORLD WIDE STONE CORPORATION
5,000,000 Shares of Common Stock, $.001 par value
This Prospectus is a part of a registration statement (the
"Registration Statement") filed with the Securities and Exchange Commission (the
"Commission") under the Securities Act of 1933, as amended, (the "Securities
Act") which relates to the issuance of an aggregate of 5,000,000 shares of
Common Stock, par value $.001, (the "Shares") of World Wide Stone Corporation
(the "Company" or "Registrant") to La Costa Financial Corporation (the
"Consultant") pursuant to the terms of a consulting agreement, effective as of
August 12, 1996 (the "Consulting Agreement"), by and between the Company and the
Consultant. As permitted by the General Rules and Regulations of the Commission,
this Prospectus does not contain all the information set forth in the
Registration Statement, including the exhibits filed as part thereof and
otherwise incorporated therein to which reference is hereby made. Copies of the
Registration Statement and the exhibits may be inspected at the offices of the
Commission, and may be obtained from the Public Reference Section of the
Commission at 450 Fifth Street, N.W., Washington, D.C.
20549 upon payment of the prescribed fees.
This Prospectus, including the information contained in Items 1 and 2
of Part I hereof and the documents incorporated by reference in Item 3 of Part
II of the Registration Statement, taken together, are intended to constitute a
prospectus that meets the requirements of Section 10(a) of the Securities Act of
1933, as amended, and Rule 428 of the General Rules and Regulations of the
Commission thereunder.
The Company's Common Stock is quoted on the over-the-counter Bulletin
Board under the symbol "WWST". On August 20, 1996, the closing bid price for the
Common Stock was $0.375 per share.
Item 1. Plan Information
Pursuant to the terms of the Consulting Agreement, the Company has
issued to the Consultant common stock purchase warrants (the "Warrants") for the
Shares in exchange for the Consultant's providing certain consulting services to
the Company. The term of the Consulting Agreement is six months unless earlier
terminated by the Company and may be renewed for like terms thereafter by mutual
consent. The Warrants are exercisable in five increments of 1,000,000 Shares
each with the first increment exercisable, in whole or in part, upon issuance
thereof and each increment thereafter exercisable, in whole or in part, upon
delivery to the Consultant of the Warrant. The delivery of each increment after
the initial increment and the exercisability thereof is dependent upon the
satisfaction of services provided by the Consultant to the Company. All the
Warrants have an exercise term of six months unless earlier terminated by the
termination of the Consulting Agreement. The per share exercise price (strike
price) of the Warrants is 70% of the prevailing bid at the time of exercise but
not less than $.25 net per share.
The foregoing information relating to the provisions of the Consulting
Agreement is intended to provide a summary thereof and does not purport to be a
complete description of the Consulting Agreement. Such summary should be read in
conjunction with the Consulting Agreement which has been filed as an Exhibit
hereto and is incorporated herein by reference in its entirety.
The Shares registered hereby are not subject to any provisions of the
Employee Retirement Income Security Act of 1974. The Shares are treasury stock,
and no shares thereof will be purchased in the open market by the Registrant.
There are no restrictions imposed upon the Consultant in the resale of the
Shares except those imposed by Federal or state securities laws and regulations.
The receipt of the Warrants and/or Shares may be considered income and may give
rise to Federal and state income taxation for the Consultant. The Registrant
anticipates that
<PAGE>
it will have a corresponding deduction for income tax purposes as compensation
paid to the Consultant. The Registrant is unable at this time to estimate the
amount or effect on it of such tax consequences.
AN INVESTMENT IN THESE SECURITIES
INVOLVES A HIGH DEGREE OF RISK.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION NOR HAS THE COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
No person has been authorized to give any information or to make any
representations in connection with the offering described herein other than
those contained in this Prospectus, and, if given or made, such information or
representations must not be relied upon as having been authorized by the
Registrant or any other person. This Prospectus does not constitute an offer to
sell or a solicitation of an offer to buy any securities other than the shares
of Common Stock to which it relates, or any offer of such shares of Common Stock
to any person in any jurisdiction in which such offer is unlawful. The delivery
of this Prospectus at any time does not imply that the information contained
herein is correct as of any time subsequent to the date of this Prospectus.
----------
Item 2. Registrant Information and Employee Plan Annual Information
The Company has provided the Consultant with a copy of the Registration
Statement and copies of the documents incorporated by reference in Item 3 of
Part II therein and has advised the Consultant in writing that such documents
will continue to be available, without charge, to the Consultant upon the
Consultant's written or oral request to the Company to its offices at 2150 West
University Drive, Tempe, Arizona 85281, 602/966-0047.
AVAILABLE INFORMATION
The Company files certain information with the Commission pursuant to
Section 12(g) of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"). Such information can be inspected and copied at the Commission's public
reference room located at Room 1024, 450 Fifth Street, N.W., Washington, D.C.
20549. Copies of such materials may also be obtained at prescribed rates from
the Public Reference Section of the Commission, 450 Fifth Street, N.W.,
Washington, D.C. 20549.
The Date of this Prospectus is August 30, 1996.
<PAGE>
PART II
INFORMATION REQUIRED
IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference
The following documents (and any amendments thereto) filed by the
Company with the Securities and Exchange Commission are incorporated herein by
reference in their entirety and shall be deemed to be a part hereof from the
date of filing such documents:
(a) The Company's Annual Report on Form 10-K for the year ended
December 31, 1995 filed with the Commission on April 8, 1996 (File No. 0-18389);
(b) The Company's Quarterly Report on Form 10-Q for the quarter ended
March 31, 1996 filed with the Commission on May 15, 1996 (File No. 0-18389);
(c) The Company's Quarterly Report on Form 10-Q for the quarter ended
June 30, 1996 filed with the Commission (File No. 0-18389);
(d) All documents subsequently filed by the Company pursuant to Section
12, 13(a), 13(c), 14 or 15(d) of the Exchange Act, prior to the filing of a
post-effective amendment which indicates that all securities offered hereby have
been sold or which deregisters all securities then remaining unsold, shall be
deemed to be incorporated by reference in this Prospectus and to be a part
hereof from the date of filing such documents. Any statement contained in a
document incorporated or deemed to be incorporated by reference herein shall be
deemed to be modified or superseded for purposes of this Prospectus to the
extent that a statement contained herein, or in any other subsequently filed
document that also is or is deemed to be incorporated by reference herein,
modifies or supersedes such statement. Any such statement so modified or
superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this Prospectus.
Item 4. Description of Securities
The Common Stock was initially registered under Section 12(g) of the
Securities Exchange Act of 1934 on Form 8A in 1990 and the description of the
Common Stock as set forth therein is incorporated herein by reference in its
entirety. In connection therewith, the following description is provided:
The Company is authorized to issue up to 100,000,000 shares of common
stock, $.001 par value and up to 25,000,000 shares of preferred stock, $.001 par
value. As of the date hereof, the number of shares of Common Stock outstanding
is 34,415,868.
The shares of Common Stock entitle the holders thereof to the
following:
The holders of Common Stock (I) have equal proratable rights to
dividends from funds legally available therefor, when, as and if declared by the
Board of Directors of the Company; (ii) are entitled to share proratably in the
assets of the Company available for distribution to holders of Common Stock upon
liquidation, dissolution or winding up of the affairs of the Company; (iii) do
not have preemptive subscription rights or conversion rights and there are no
redemption or sinking fund provisions applicable thereto; and (iv) are entitled
to one non-cumulative vote per share on all matters which shareholders may vote
on at all meetings of shareholders. All shares of Common Stock outstanding are
fully paid and non-assessable.
There are no shares of Preferred Stock outstanding.
<PAGE>
The Company's board of directors has the authority, without action by
the Company's shareholders, to issue all or any portion of the authorized but
unissued shares of Common Stock, which may have the effect of reducing the
percentage of securities ownership of the Company's shareholders and diluting
the book value of the Common Stock.
The Common Stock of the Company is thinly traded in the
over-the-counter market and quoted on the over-the-counter Bulletin Board. There
is no established public market for the Common Stock except for the stock being
listed on a daily basis on the Bulletin Board. The existence of a limited and
sporadic market in the Common Stock should not be deemed to constitute an
established public trading market.
Item 5. Interests of Named Experts and Counsel
Not applicable
Item 6. Indemnification of Directors and Officers
The Company's Articles of Incorporation provide that:
"No director or officer of the corporation shall be personally liable
to the corporation or any of its stockholders for damages for a breach of a
fiduciary duty as a director or officer involving any act or omission of any
such director or officer occurring on or after the date of their taking office;
provided, however, that the foregoing provision shall not eliminate or limit the
liability of a director or officer of the corporation for (a) acts or omissions
which involve intentional misconduct, fraud or a knowing violation of law; or
(b) the payment of dividends in violation of Nevada Laws".
The Company's By-Laws provide that:
"The shareholders, officers and directors of this corporation shall not
be individually liable for the corporation debts or other liabilities, and
private property of such individuals shall be exempt from corporation debts or
liabilities.
The corporation shall indemnify every person, his heirs, executors and
administrators against all expenses reasonably incurred by such person in
connection with any action, suit or proceeding to which such person may be made
a party by reason of that person being or having been a director or officer of
this corporation, or by reason of that person being or having been a director or
officer of any other corporation of which this corporation is a shareholder or
creditor, and from which other corporation such person is not entitled to be
indemnified, or by reason of such officer or director or former officer or
former director becoming a party to any such action, suit or proceeding at the
request of or at the direction of this corporation or any successor hereto;
provided, however, there shall be no indemnification in relation to any matter
as to which such person shall be finally adjudged in such action, suit or
proceeding to be liable for negligence or misconduct. In the event of a
settlement of such action, suit or proceeding, indemnification of such person
shall be provided only in connection with such matters covered by such
settlement as to which the corporation is advised by counsel that such person to
be indemnified did not commit such a breach of duty. This right of
indemnification shall be exclusive of other rights to which such person may be
entitled. As used in this Bylaw, expenses shall include, but shall not be
limited to, amounts of judgments, penalties or fines and interest thereon for
reasonable periods of time, rendered, levied or adjudged against such persons,
costs of the action, suit or proceeding, attorneys' fees, expert witness fees
and amounts paid in settlement by such persons, provided that such settlement
shall have been or is thereafter approved by the board of directors of this
corporation. This Bylaw is made a part of these Bylaws to comply with and to
take full advantage of state laws governing such indemnification."
<PAGE>
Item 7. Exemption from Registration Claimed
Not Applicable.
Item 8. Exhibits
Exhibit No. Item
- ----------- ----
5.1 Opinion of Cassidy & Associates.
10.1 Consulting Agreement by and between La Costa Financial
Corporation and World Wide Stone Corporation effective as of
August 12, 1996.
23.1 Consent of Independent Public Accountant.
23.2 Consent of Cassidy & Associates (contained in Exhibit 5.1).
Item 9. Undertakings
Rule 415 Offering.
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are
being made, a post-effective amendment to this registration statement
(i) to include any prospectus required by section
10(a)(3) of the Securities Act of 1933;
(ii) to reflect in the prospectus any fact or events
arising after the effective date of the registration
statement (or the most recent post-effective
amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the
information set forth in the registration statement;
(iii) to include any material information with
respect to the plan of distribution not previously
disclosed in the registration statement or any
material change to such information in the
registration statement;
provided, however, that subparagraphs (i) and (ii) will not apply (in
the case of registration statements on Form S-3, Form S-8 or Form F-3)
if the Registrant files or furnishes the information required to be
included in a post-effective amendment by those subparagraphs in
periodic reports to the Commission pursuant to Section 13 or Section
15(d) of the Securities Act of 1934 that are incorporated by reference
in the registration statement.
(2) That, for the purpose of determining any liability under
the Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall
be deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at
the termination of the offering.
<PAGE>
Subsequent Exchange Act Documents Incorporated by Reference.
The undersigned Registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act of 1933,
each filing of the Registrant's annual report pursuant to Section 13(a)
or Section 15(d) of the Securities Exchange Act of 1934 (and, where
applicable, each filing of an employee benefit plan's annual report
pursuant to Section 15(d) of the Securities Exchange Act of 1934) that
is incorporated by reference in the registration statement shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall
be deemed to be the initial bona fide offering thereof.
Request for Acceleration of Effective Date or Filing of Registration Statement
on Form S-8.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers or
controlling persons of the Registrant pursuant to the foregoing
provisions, or otherwise, the Company has been informed that in the
opinion of the Securities and Exchange Commission such indemnification
is against public policy as expressed in the Act and is therefore
unenforceable. In the event that a claim for indemnification against
such liabilities (other than a payment by the Registrant of expenses
incurred or paid by a director, officer or controlling person of the
Registrant in the successful defense of any action, suit or proceeding)
is asserted by such director, officer or controlling person in
connection with the securities being registered, the Registrant will,
unless in the opinion of its counsel the matter has been settled by
controlling precedent, submit to a court of appropriate jurisdiction
the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final
adjudication of such issue.
<PAGE>
Signature Page
Pursuant to the requirements of the Securities Act of 1933, as amended,
the Registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-8 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Tempe, State of Arizona on August 20, 1996.
WORLD WIDE STONE CORPORATION
/s/ Frank E. Cunningham, President
In accordance with the requirements of the Securities Act of 1933, as
amended, this Registration Statement on Form S-8 was signed by the following
persons in the capacities and on or as of the dates stated.
<TABLE>
<CAPTION>
Signature Title Date
<S> <C> <C>
/s/ Frank E. Cunningham President, Treasurer, August 20, 1996
Director
/s/ Spencer Cunningham Vice President, August 20, 1996
Director
/s/ Lee M. Cunningham Secretary, Director August 20, 1996
/s/ L. Ernest Whitesel Director August 20, 1996
/s/ Michael D. Nafziger Director August 20, 1996
</TABLE>
EXHIBIT 5.1
Cassidy & Associates
Attorneys At Law
1504 R Street, N.W.
Washington, D.C. 20009
202/387-5400
August 24, 1996
Board of Directors
World Wide Stone Corporation
2150 West University Drive
Tempe, Arizona 85281
Gentlemen:
This opinion letter is submitted to you in conformance with Item 601 of
Regulation S-K of the Securities and Exchange Commission with respect to the
registration by World Wide Stone Corporation ("the Company") of 5,000,000 shares
of Common Stock, par value $0.001 per share ("the Shares"), to be issued upon
the exercise of Common Stock Purchase Warrants ("the Warrants") granted pursuant
to a Consulting Agreement dated August 12, 1996 between the Company and La Costa
Financial Corporation.
We have examined the original, certified, conformed, photostatic,
electronic, facsimile or other forms of such corporate records, resolutions,
certificates, authorizations or other documents as we have considered relevant
to our opinion. In all such examinations, we have assumed the genuiness of all
signatures on original documents and the conformity to originals and certified
documents of all copies submitted to us as conformed, photostatic, electronic or
facsimile copies. In reviewing corporate records and other documents, we have
assumed the accuracy of those records and documents. We have consulted with such
officers, directors, employees, and advisors of the Company in regard to
questions of material fact as we have considered relevant to our opinion, and
have relied upon the accuracy and completeness of the statements and
representations of such persons. We have examined such laws, statutes, judicial
or administrative decrees, interpretations and opinions, and such other sources
as we have considered material to the legal issues relevant to our opinion.
Based upon and in reliance on the foregoing, we are of the opinion that
the Shares have been duly reserved for issue upon exercise of the Warrants and
that the Shares, when issued in conformance with the terms of the Warrants as
authorized by the Board of Directors of the Company, will be duly authorized and
validly issued, fully paid and non-assessable.
<PAGE>
We hereby consent to the inclusion of this opinion letter in the
Registration Statement to be filed with the Securities and Exchange Commission.
Sincerely,
Cassidy & Associates
By: /s/ James Michael Cassidy, Esq.
EXHIBIT 10.1
CONSULTING AGREEMENT
--------------------
This CONSULTING AGREEMENT is made and entered into effective on
Tuesday, the 12th day of August in the year 1996, by and between:
La Costa Financial Corporation (hereinafter, the "Consultant"), a Utah
corporation in good standing, whose principal place of business is located at
6965 El Camino Real, Suite 105-161, Carlsbad, California 92009, Telephone &
Telefax: (619) 759-2269 or, alternately, Telefax: (619) 223-1878, E-Mail:
http:\[email protected]; and,
World Wide Stone Corporation (hereinafter, the "Company"), a Nevada
corporation in good standing registered with the State of Arizona as a foreign
corporation, whose corporate office and principal place of business is located
at 2150 West University Drive, Suite B, Tempe, Arizona 85281, Telephone: (602)
966-0047, Telefax: (602) 966-9925.
RECITALS:
WHEREAS, La Costa Financial Corporation is a professional in the
securities industry and shall be held to professional standards therefor with
respect to the subject matter of this Agreement; and,
WHEREAS, the Company is a publicly held company specializing in the
dimensional stone industry; and,
WHEREAS, neither the Company nor any of its officers or directors are
professionals in the securities industry and shall not be held to professional
standards therefor with respect to the subject matter of this Agreement; and,
WHEREAS, Consultant desires, in consideration for fees, to provide
various productive services and valuable advice to the Company for the promotion
of its financial well being, as the same is further described below herein; and
WHEREAS, in reliance upon Consultant's professional expertise, the
Company desires to retain Consultant to provide the said productive services and
valuable advice for the Company.
NOW, THEREFORE, in consideration of the mutual covenants and promises
contained herein, the receipt and sufficiency of which both in law and in equity
are hereby mutually acknowledged, the parties hereby agree as follows:
(Continued on Page 2)
<PAGE>
DUTIES AND INVOLVEMENT:
1. The Company hereby engages Consultant to provide financial and public
relations services for the Company. Such services will generally include the
following services: assist in the development of an active market in the common
stock of the Company, advice to and consulting with the Company's management
concerning marketing surveys, investor profile information, methods of expanding
investor support and increasing investor awareness of the Company and its
products and/or services, broker relations, assisting in the preparation and
format of due diligence meetings, and attendance and presentations at various
meetings, including but not limited to conventions and trade shows. Consultant
warrants that it will act to the benefit of the Company and all of its
stockholders with respect to all such services, consultations, advice,
recommendations, participations, and acts.
2. Consultant acknowledges that neither it nor any of its employees or
affiliates is an officer, director, or agent of the Company, that in rendering
advice or recommendations to the Company, it is not and will not be responsible
for any management decisions on behalf of the Company, and that it is not
authorized or empowered to commit the Company to any recommendation or course of
action. Consultant warrants that it does not have, through stock ownership or
otherwise, the power to control the Company nor to exercise any dominating
influence over its management. Company is not responsible for the acts, errors
or omissions of Consultant. Company acknowledges that neither Consultant nor any
of its employees or affiliates is an officer, director, or agent of the Company.
Further, the Company acknowledges that, while Consultant has advised that it or
its employees currently own, directly or beneficially, Forty Thousand (40,000)
shares of the Company, in reliance on the report by, and in accord with the
records of the transfer agent (i.e., Progressive Transfer Company, Inc. of Salt
Lake City, Utah) of the Company, neither Consultant nor its president or vice
president are listed in their names on the records as "control persons" by
virtue of stock ownership of the Company.
3. This Agreement is expressly intended to provide for the services to the
Company of the Consultant as an Independent Contractor. The Consultant hereof is
not, and shall not be deemed to be an employee of the Company and, as such, is
not entitled to any of the rights, duties, or other benefits provided to
employees of the Company by the Company or by operation of Law. Consultant shall
be solely responsible for the payment of its own federal, state and local income
taxes, as well as any Social Security (FICA) and unemployment (FUTA) or other
taxes it might owe or come to owe. If Consultant employees or undertakes to
employ any person or entity, then Consultant shall be solely responsible for
their (i) compensation, (ii) withholding income, FICA, FUTA and other taxes from
such employees' wages, and (iii) obtaining worker's compensation insurance for
such employees.
4. Consultant shall devote such of its time and effort necessary to the
discharge of its duties hereunder and the performance pursuant to the terms and
conditions of this Agreement. The Company acknowledges that Consultant is
engaged in other business activities and that it will continue such activities
during the term of this Agreement. Consultant shall not be restricted
- --------------------------------------------------------------------------------
CONSULTING AGREEMENT, EFFECTIVE ON 12TH AUGUST 1996
Between La Costa Financial Corporation & World Wide Stone Corporation
(Page 11 of 10 Pages) Initials: Company / i / / i / Consultant / i / / i /
---- ---- ---- ----
<PAGE>
from engaging in other business activities during the terms of this Agreement,
so long as such activities shall not work to the disbenefit of the Company or
its stockholders.
TERM OF AGREEMENT:
5. The initial term of this Agreement shall be for a period of six (6) months
from the effective date hereof.
6. There shall be one (1) automatic renewal term of this Agreement for an
additional period of six (6) months from the renewal date, which renewal date
shall be the expiration of the initial term hereof, provided that neither party
hereto shall have given prior "Notice of Non-Renewal" in writing to the other
party not less than ten (10) days prior to the expiration of the initial term
hereof.
7. In addition to the initial term and the automatic renewal term hereof, the
parties hereto may choose to agree under a separate written agreement to other,
additional renewals hereof; however, such other, additional renewals hereof
shall not be automatic.
8. Upon satisfactory performance by Consultant of the duties of the Consultant
herein, as the satisfactory nature thereof may be solely judged from time to
time by Company, Company shall not engage or hire any third party to perform
such services as those described herein to be performed by Consultant without
Consultant's prior written consent. Further, the parties agree that Consultant
shall be the exclusive consultant to the Company during the term of this
Agreement with respect to the duties herein defined.
COMPENSATION:
9. As total and complete compensation for the services provided and to be
provided and expenses incurred and to be incurred by Consultant hereunder, the
Company will issue Common Stock Purchase Warrants for a total of Five Million
(5,000,000) shares of the Company's common stock ("Warrants"); however,
Consultant shall have earned, and shall be entitled to delivery of these
Warrants only upon satisfactory performance of Consultant, the satisfactory
nature of which performance shall be solely determined at the discretion of the
Company, and only in increments as described herein below.
10. The Warrants may be exercised at any time or times for a period of six (6)
months following the issue of the Warrants to the Consultants, which shall be
done in increments as provided for herein. Notwithstanding the term of the
Warrants, the time to exercise any Warrants which shall have been issued
pursuant to this Agreement to Consultant which are unexercised, in part or in
whole, at the time of termination of this Agreement shall expire, without
further action by the Company, five (5) days following such termination period.
11. All shares of common stock of the Company underlying the Warrants shall be
registered by the parties under the procedures and means as guided and advised
by Consultant for free-
- --------------------------------------------------------------------------------
CONSULTING AGREEMENT, EFFECTIVE ON 12TH AUGUST 1996
Between La Costa Financial Corporation & World Wide Stone Corporation
(Page 12 of 10 Pages) Initials: Company / i / / i / Consultant / i / / i /
---- ---- ---- ----
<PAGE>
trading under the Securities Act of 1933, as amended, as soon as is reasonably
possible following the mutual execution of this Agreement ("Registration").
12. Upon satisfactory performance of the Consultant, the Warrants shall be
delivered to Consultant in five (5) increments of One Million (1,000,000) shares
each ("Increment"); however, the Warrants and the shares represented thereby
shall not be considered to have been earned by Consultant, except as provided
hereinafter. Increments shall be delivered by Company to Consultant as payment
in advance for services and advice of Consultant based upon the satisfactory
performance thereof with respect to the prior Increment delivered; except that
the first such Increment shall be deemed delivered as payment in advance of any
performance whatsoever of services to be provided to Company by Consultant under
the terms and conditions of this Agreement. Therefore, with respect to the first
Increment, Company shall deliver the same to Consultant in the Company's
reliance only upon the basis of the represented professional standards of
Consultant and, especially, its president and vice president, and the good will
that exists between the parties hereto, said good will developed over several
months of discussions, meetings and representations of the Consultant. In
addition to the right of the Company to withhold delivery of any and all
subsequent Increments, Company shall have the right of claim against Consultant
should satisfactory performance of the Consultant not materialize in respect to
that first such Increment. As used in this paragraph in the immediately
preceding sentence with respect to the Company's "right of claim", "satisfactory
performance" shall mean performance reasonably expected and required to be
performed by the Consultant under this Agreement, as may be defined and
determined by the arbitrator in any arbitration in which any such claim may be
made.
13. The first Increment shall be delivered by Company to Consultant as soon as
practicable following mutual execution of this Agreement. The subsequent four
(4) Increments shall be delivered one (1) at a time by Company to Consultant
upon the satisfactory performance of services provided by Consultant with
respect to the prior increment delivered until all Warrants shall have been
delivered, provided that the Company shall not be obligated to deliver any
further Warrants after the termination of this Agreement.
14. Each Increment shall be exercisable by Consultant, in whole or in part, at
70% of the prevailing bid ("prevailing bid" is defined as the bid at the time
each transaction is consummated) at the time of sale as such securities as
quoted by the Nasdaq OTC bulletin board, provided that no Warrants may be
exercised for less than net 25(cent) per share to Company, except with the prior
written mutual consent of the parties hereto. Payments by Consultant to Company
for such securities shall be made within four (4) business days following each
date of each transaction.
15. Consultant shall be accountable to Company and shall, not less often than
daily, provide to Company a complete report of Consultant's activities related
to company, including, but not limited to trading detail, number of trades with
details thereof, total volume, number of shares and Warrants transacted or
exercised, prevailing bid for each transaction, number of shares transacted,
amount of funds to be paid by Consultant to Company @ 70% of prevailing bid for
- --------------------------------------------------------------------------------
CONSULTING AGREEMENT, EFFECTIVE ON 12TH AUGUST 1996
Between La Costa Financial Corporation & World Wide Stone Corporation
(Page 13 of 10 Pages) Initials: Company / i / / i / Consultant / i / / i /
---- ---- ---- ----
<PAGE>
Warrants exercised, and all other detail pertinent to all trading, promotion of
the Company, etc. conducted by Consultant. Further, Consultant shall provide to
Company copies as received in writing by Consultant from broker-dealers of all
related trade confirmations.
16. Regardless of such services and advice as may have been provided and such
expenses as may have been incurred by Consultant hereunder and to the date of
termination of this Agreement, Consultant shall be deemed to have been paid in
full at the moment this Agreement is terminated by either party hereto for any
reason; and upon such termination, Consultant shall have no further claim
against Company. Further, the Consultant shall be considered by all the parties
hereto as paid in full regardless of the number of Warrants issued and
regardless of the number of such Warrants delivered or not delivered to
Consultant and regardless of the number of shares of the common stock of the
Company ("Shares") which shall at such time have been issued to Consultant under
the terms and conditions of this Agreement and regardless of the number of
Warrants and/or Shares in the possession of Consultant.
EXPENSES:
17. Consultant shall pay for all costs and expenses incurred by it and its
representatives and by third parties engaged by Consultant in connection with
this Agreement.
18. As to expenses associated with Registration, the Company shall be
responsible for payment of up to Twenty Thousand (20,000) Shares, which Shares
shall be issued under the above referenced Registration, to be paid to all third
parties in total costs and professional fees required for the above referenced
Registration, not limited to its preparation and filing, and Consultant shall be
responsible for the balance of payment of any additional costs and fees
therefor. The Company will pay all accounting costs incident to the preparation
of financial statements and financial data required for the Registration.
19. Company shall, on behalf of Consultant, pay a total of up to Forty Thousand
(40,000) Shares, also issued in the above Registration, in legitimate fees to
Equitrade Securities Corporation of Lake Forrest, California, the Company's
market maker.
20. Company shall pay to Consultant an additional Ten Thousand (10,000) Shares,
also issued in the above Registration, as a reimbursement for Consultant's
expenditures associated with "blue sky" filings in California and elsewhere on
behalf of the Company, with disseminating information concerning the Company of
value to its current and future shareholders, including publication of such
information in Standard & Poor's securities manual, and in devising, arranging
for, and establishing a "web site" for the Company that is mutually satisfactory
to the parties hereto.
CONFIDENTIALITY:
21. Consultant acknowledges that it has had, and may have access to confidential
information regarding the Company, its business, and its manufacturing and
marketing practices and
- --------------------------------------------------------------------------------
CONSULTING AGREEMENT, EFFECTIVE ON 12TH AUGUST 1996
Between La Costa Financial Corporation & World Wide Stone Corporation
(Page 14 of 10 Pages) Initials: Company / i / / i / Consultant / i / / i /
---- ---- ---- ----
<PAGE>
methods. Consultant warrants that it will not, during or subsequent to the
termination of this Agreement, except as reasonably required in the legitimate
performance of is services hereunder, divulge, furnish or make accessible to any
person or entity (other than with the prior written permission of the Company)
any knowledge or information or plans of the Company with respect to the
Company, its business, or its manufacturing and marketing practices and methods,
including, but not limited to the products of the Company, whether in the
concept or development stage or being marketed by the Company.
COVENANT NOT TO COMPETE:
22. During and for a period of not less than five (5) years after the term of
this Agreement, Consultant represents, agrees and warrants that it will not
compete directly or indirectly with the company in the Company's industry or
related fields.
REGISTRATION OF SECURITIES:
23. Upon mutual execution of this Agreement, the parties will prepare and file
with the United States Securities and Exchange Commission ("SEC") a registration
statement covering the Shares underlying the Warrants, the above referenced
Registration, and will diligently cause such registration statement to become
effective as soon as possible. The Company will undertake to comply with the
various states securities laws and regulations with respect to the registration
of the Shares.
24. For not less than twelve (12) months following the registration of the
Shares, the Company as advised and guided by Consultant shall maintain and be
current on all filings with the SEC, appropriate state securities departments
and, as may be required, with the National Association of Securities Dealers,
Inc., the Nasdaq SmallCap Market, and/or national or regional stock exchanges
necessary to allow the Shares to be freely tradable in the public market.
ADDITIONAL REPRESENTATIONS OF THE COMPANY:
25. Company will furnish to Consultant, as reasonably requested within the
normal course of business, all information concerning the Company which is
relevant to its past, current and planned operations, including without
limitation (i) financial statements, including current cash received and
disbursed, (ii) issuance of stock, stock options or warrants, including the
pricing of such stock and stock rights, (iii) terms of employment agreements,
including benefits of all types, (iv) all Board of Directors resolutions, (v)
all borrowing of any type, (vi) shareholder lists, for purposes of verification
only and not for other purposes such as solicitation, (vii) monthly reports from
the Depository Trust Corporation ("DTC") or similar organization, and (viii) all
related transactions among the Company and any affiliates or controlling persons
of the Company.
26. Company has been advised that it is authorized and has the full power to
issue the Warrants and to file a registration statement for the Shares. Such
issuance or registration thereof
- --------------------------------------------------------------------------------
CONSULTING AGREEMENT, EFFECTIVE ON 12TH AUGUST 1996
Between La Costa Financial Corporation & World Wide Stone Corporation
(Page 15 of 10 Pages) Initials: Company / i / / i / Consultant / i / / i /
---- ---- ---- ----
<PAGE>
will not violate any agreement, covenant, understanding, arrangement or
otherwise with any party, broker, agent or entity.
INVESTMENT REPRESENTATION:
27. Company represents and warrants that it has provided Consultant access to
all information available to the Company concerning its condition, financial and
otherwise, its management, its business and its prospects, and Consultant
acknowledges the same. Company represents that it has provided Consultant with
all copies of the Company's filings for the prior twelve (12) months made under
the Rules and Regulations promulgated under the Securities Act of 1933, as
amended (the "Act"), or the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), if any (the "Disclosure Documents"), and Consultant
acknowledges the same.
28. Consultant acknowledges that the acquisition of the securities to be issued
to Consultant involves a high degree of risk. Consultant represents that it and
its advisors have been afforded the opportunity to discuss the Company with its
management. The Company represents that it has and will continue to provide
Consultant with any information or documentation necessary to verify the
accuracy of the information contained in the Disclosure Documents and will
promptly notify Consultant upon the filing of any registrations statement or
other periodic reporting documents filed pursuant to the Act or the Exchange
Act.
OMNIBUS CLAUSES:
29. Indemnification. Neither party hereto shall be held responsible for the
acts, errors or omissions of the other, and each party hereto shall indemnify
and save harmless the other against all claims of third parties with respect
thereto.
30. Amendments. The terms and Conditions, agreements and covenants contained
herein may be amended, altered, modified or otherwise dealt with provided the
same is reduced to writing and signed by both of the parties hereto.
31. Severance. The respective clauses of this contract are severable, and the
severance of one or more clauses will in no way detrimentally or otherwise
affect the remaining clauses.
32. Construction. Should a respective clause be severed (P. 31), but the intent
of that clause becomes clear either under arbitration (P. 35) or to a Court of
Competent Jurisdiction, a party hereto having brought such question to such
Court, then the parties hereto agree that such Court is hereby authorized to
construct the severed clause in conformance with the parties' original intent as
interpreted by such Court and in proper conformance with the law, regulation or
policy that had been the basis for its severance in the first place, and the
resulting constructed clause shall become a part hereof.
33. Deletions. In the event that some portion of this contract is deemed by both
parties hereto, or by a Court of Competent Jurisdiction, to be inapplicable,
inoperative or otherwise of
- --------------------------------------------------------------------------------
CONSULTING AGREEMENT, EFFECTIVE ON 12TH AUGUST 1996
Between La Costa Financial Corporation & World Wide Stone Corporation
(Page 16 of 10 Pages) Initials: Company / i / / i / Consultant / i / / i /
---- ---- ---- ----
<PAGE>
no force or effect then that said portion shall be deleted and the balance of
this contract shall be read as thought the deleted portion never existed, except
in case of construction under P. 32 hereof.
34. Remedies. Should either of the parties hereto determine that the other party
hereto has committed a fault, error, omission or breach of this Agreement, then
the aggrieved party shall give notice of its grievance to the offending party as
provided for herein and the offending party shall have the right to act
immediately to remedy said grievance.
35. Arbitration. For their mutual benefit, the parties hereto specifically
establish that either City of Phoenix or City of Tempe, State of Arizona, shall
be the venue and location for the settlement of any dispute, controversy or
claim between the Company and Consultant arising out of or related to this
Agreement, or breach thereof, whether settled by arbitration or for purposes of
obtaining injunctive relief. Further, any dispute, controversy or claim between
the Company and Consultant arising out of or related to this Agreement, or
breach thereof, shall be settled by arbitration, which shall be conducted in
accordance with the rules of the American Arbitration Association then in
effect. In presenting any matter for arbitration, as provided herein, the
parties shall direct that such arbitration shall occur and convene only in
either the City of Phoenix or City of Tempe, State of Arizona, and this venue
shall be a condition of arbitration. Any award shall be binding and conclusive
for all purpose thereof, may include injunctive relief, as well as orders for
specific performance, and may be entered as a final judgment in any court of
competent jurisdiction. No arbitration arising out of or relating to this
Agreement shall include, by consolidation or joinder or in any other manner,
parties other than the Company or Consultant and other persons substantially
involved in common questions of fact or law whose presence is required if
complete relief is to be afforded in arbitration. The costs and expenses of such
arbitration shall be borne in accordance with the determination of the
arbitrator and may include reasonable costs and attorney's fees. Each party
hereby further agrees that service of process may be made upon it by Certified
Mail, Return Receipt Requested, Express Delivery or Personal Service at the
addresses first shown above herein (Page 1).
36. Litigation. With the exception of Injunctive Relief, the parties hereto
specifically covenant and agree, each with the other, that no suit at law or
equity or litigation of any nature, type or kind will be initiated by either
party against the other. The prevailing party will be entitled to costs and
reasonable attorney's fees.
37. Waiver. In the event that a fault, error, omission or breach of this
contract shall occur on the part of one or the other party hereto and neither
party hereto gives notice thereof, as provided for in this contract, then such
failure to give such notice and/or such waiver thereof, shall apply only to that
one isolated incident and shall not be construed by either party hereto as a
prevailing, constant waiver nor a waiver of a subsequent breach or other default
which may become the subject of such notice as herein provided.
- --------------------------------------------------------------------------------
CONSULTING AGREEMENT, EFFECTIVE ON 12TH AUGUST 1996
Between La Costa Financial Corporation & World Wide Stone Corporation
(Page 17 of 10 Pages) Initials: Company / i / / i / Consultant / i / / i /
---- ---- ---- ----
<PAGE>
38. Governing Law. For the benefit of parties, this contract shall be subject
to, interpreted and governed by the laws of the States of Arizona and
California; however, for the mutual benefit of the parties, venue for all
disputes shall be County of Maricopa, State of Arizona.
39. Prior Agreements. This Agreement supersedes all prior verbal or written
agreements between the parties hereto.
40. Notices. Any notice to be given by each or other party hereto shall be
deemed to have been duly and properly given if mailed one to the other by
pre-paid Certified Mail, Return Receipt Requested, Express Delivery or Personal
Service at the addresses as first shown above herein, or at such other address
as the party giving such notice may have received in writing from the said
party. Any change of address must be delivered to the other party, as herein
provided, and becomes a part in whole of this contract.
41. Assignment. This Agreement is assignable by either party hereto, provided
the assigning party has received prior written permission from the other party
hereto.
42. Successors and Assigns. This Agreement shall inure to the lawful successors
and assigns of the parties hereto.
43. Fax. A copy of this Agreement, or any other documents executed and/or signed
by either of the parties hereto and sent to the other party hereto by electronic
facsimile transmission ("fax") carries the full force and effect as if it were
the original, provided that the fax copy bears the sending party's transmitting
terminal identifier ("TTI") and the date and time which was placed thereon
electronically by the transmitter.
44. Execution. This Agreement may be executed in counterparts, and each of said
counterparts shall be construed to be an original. Prior to the exchange of
signed, hard copy, original counterparts, executed fax copies hereof exchanged
shall be construed to be originals; thereafter, upon exchange, said hard copies
shall supersede said fax copies and become the true originals. The parties
acknowledge that, two (2) officers of both the Company and Consultant shall
execute this Agreement, but it shall not be considered effective until ratified
by the Board of Directors of the Company.
45. Document Preparation. This contract has been arrived at through the mutual
negotiations of the parties and is not to be construed as the product of either
one or the other party hereto unilaterally; and, while this Agreement was word
processed in its final form by an employee of the Company, Spencer W.
Cunningham, he has not held himself out to be either an attorney at law or an
attorney in fact to either party hereto; and the parties hereto shall save
harmless and indemnify Spencer W. Cunningham for his valuable service in this
regard.
IN WITNESS WHEREOF, the parties hereto have affixed their respective
hands and seals to this foregoing 10-page Agreement effective on the 12th day of
August in the year 1996.
- --------------------------------------------------------------------------------
CONSULTING AGREEMENT, EFFECTIVE ON 12TH AUGUST 1996
Between La Costa Financial Corporation & World Wide Stone Corporation
(Page 18 of 10 Pages) Initials: Company / i / / i / Consultant / i / / i /
---- ---- ---- ----
<PAGE>
"CONSULTANT": LA COSTA FINANCIAL CORPORATION
/s/Ted J. Heitzman/ 08/12/96
------------------- --------
Ted J. Heitzman, President Date
/s/Richard A. May/ 08/12/96
------------------ --------
Richard A. May, Vice President Date
"COMPANY": WORLD WIDE STONE CORPORATION
/s/Frank E. Cunningham/ 08/14/96
----------------------- --------
Frank E. Cunningham, President Date
/s/Spencer W. Cunningham/ 08/14/96
------------------------- --------
Spencer W. Cunningham, Date
Executive Vice President
RATIFICATION: The foregoing 10-page Agreement was ratified by the Board of
Directors of World Wide Stone Corporation on the 19th day of August in the year
1996. Attest:
/s/Lee M. Cunningham/ 08/19/96
- --------------------- --------
Lee M. Cunningham, Corporate Secretary Date
EXHIBIT 23.1
Mark Shelley CPA
110 S. Mesa Dr. #1
Mesa, Arizona 85210
(602) 833-4054
CONSENT OF INDEPENDENT CERTIFIEDI PUBLIC ACCOUNTANT
I hereby consent to the use in this Registration Statement on Form S-8
of may report dated March 15, 1996 relating to the consolidated financial
statements of World Wide Stone Corporation, year ended December 1995, and to the
reference of this Firm under the caption of "Experts".
/s/ Mark Shelley CPA
Mesa, Arizona
August 20, 1996
