FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
DECEMBER 31, 1997
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WINDSOR CAPITAL CORP.
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(Exact name of registrant as specified in its charter)
DELAWARE 33-11935 59-2754843
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(State or other (Commission File (I.R.S. Employer
jurisdiction of Number) Identification No.)
incorporation)
350 E. IRVING PARK ROAD
ROSELLE, ILLINOIS 60172
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(Address of principal executive offices) (Zip Code)
(630) 529-9424
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(Registrant's telephone number including area code)
1111 KANE CONCOURSE, SUITE 505
BAY HARBOR ISLAND, FLORIDA 33154
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(Former name or former address, if changed since last report)
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Item 1. Changes in Control of Registrant
On December 31, 1997, Woodfield Enterprises, Inc., a privately-held
Florida corporation ("Woodfield"), merged with and into Windsor Capital Corp.
(the "Registrant"). Pursuant to the merger, 6,700,000 shares of the Registrant's
common stock, par value $0.001 per share, were issued to the former shareholders
of Woodfield in a private transaction pursuant to Section 4(2) of the Securities
Act of 1933, as amended. Prior to the merger, the Registrant had 5,525,000
shares of common stock outstanding and effectuated a recapitalization, which
included a sale by the Registrant's majority shareholder, International Asset
Management Group, Inc. ("IAMG") to Woodfield of 4,480,000 shares
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and 5,000,000 warrants, which were canceled by Woodfield in accordance with the
terms and conditions of the Agreement and Plan of Merger among the Registrant,
IAMG and Woodfield dated December 18, 1997 (the "Merger Agreement"). Upon
completion of the merger, the Registrant had 7,745,000 shares of common stock
outstanding, of which 6,700,000 were held by the former Woodfield shareholders.
On December 31, 1997, resignations were tendered by the executive
officers and all but one of the directors (Mr. Hershel Krasnow) of the
Registrant, and designees of Woodfield were elected to the Board of Directors
and as executive officers of the Registrant in accordance with the terms and
conditions of the Merger Agreement. The executive officers and directors of the
Registrant are now as follows:
NAME POSITION(S)
- -------------------- -----------------------------------
Harold S. Blue Chairman of the Board, Treasurer
Gary N. Mansfield Chief Executive Officer, Secretary,
Director
Guy F. Wood President
Eugene R. Terry Director
Edwin M. Cooperman Director
Hershel Krasnow Director
In accordance with the Merger Agreement, IAMG agreed to a lock-up of
its remaining 355,000 shares of common stock whereby such shares may not be sold
except in increments of 177,500, 88,750 and 88,750 shares, which will be
released from the lock-up six, nine and twelve months subsequent to December 31,
1997, respectively.
The foregoing is merely a summary of certain of the terms of the Merger
Agreement and the transactions contemplated therein, and does not purport to be
a complete statement of the terms, conditions and provisions thereof. A copy of
the Merger Agreement is included as Exhibit 2.1 to this report.
The following table sets forth certain information with respect to the
beneficial ownership of the Registrant's common stock as of December 31, 1997,
after giving effect to the merger with respect to (i) each person known to the
Registrant to be the beneficial owner of more than 5% of the Registrant's common
stock, all of whom are former Woodfield shareholders, (ii) each director and
executive officer of the Registrant, all of whom, except for Mr. Krasnow, are
former Woodfield directors and executive officers, (iii) all directors and
executive officers as a group, and (iv) all former Woodfield shareholders as a
group:
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SHARES OF THE REGISTRANT'S
COMMON STOCK
BENEFICIALLY OWNED AFTER
NAME AND ADDRESS OF BENEFICIAL OWNER THE MERGER (1)
- ------------------------------------ -----------------------------
NUMBER PERCENT
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Harold S. Blue 1,087,500(2) 13.4%
Gary N. Mansfield 700,000 9.0%
Guy F. Wood 800,000 10.3%
Eugene R. Terry 112,500(3) 1.4%
Edwin M. Cooperman 55,000(4) *
Hershel Krasnow 355,000(5) 4.6%
Michael Falk
830 Third Avenue
New York, NY 10017 750,000 9.6%
J.F. Shea Co.
655 Brea Canyon Road
Walnut, CA 71789 750,000 9.6%
Bellingham Industries, Inc.
Farley Edge
Westerham
Kent TN16 1UB
England, UK 500,000 6.5%
Directors and executive officers as a group 3,110,000(6) 38.2%
All former shareholders of Woodfield as a group 7,252,500(7) 87.4%
* Less than 1%
(1) A person is deemed to be the beneficial owner of securities that can be
acquired within 60 days from the date set forth above through the exercise of
any option, warrant or right. Shares of the Registrant's common stock subject to
any option, warrant or rights that are currently exercisable or exercisable
within 60 days are deemed outstanding for purposes of computing the percentage
ownership of the person holding such options, warrants or rights, but are not
deemed outstanding for purposes of computing the percentage ownership of any
other person.
(2) Includes 387,500 shares issuable upon the exercise of currently exercisable
warrants.
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(3) Includes 12,500 shares issuable upon the exercise of currently exercisable
warrants.
(4) Includes 5,000 shares issuable upon the exercise of currently exercisable
warrants.
(5) These shares are held by IAMG, a company jointly controlled by Mr. Krasnow
and the Registrant's former President, Robert M. Leopold. Mr. Krasnow owns less
than one percent of the capital stock of IAMG.
(6) Includes 405,000 shares issuable upon the exercise of currently exercisable
warrants.
(7) Includes 552,500 shares issuable upon the exercise of currently exercisable
warrants.
Item 2. Acquisition or Disposition of Assets
On December 31, 1997, pursuant to the merger described in Item 1, the
Registrant acquired all of the business and assets of Woodfield and assumed all
of Woodfield's liabilities. The acquired business involves the operation of 14
specialty retail outlets under the name "Simply Cigars." These outlets sell
hand-rolled premium cigars, cigar-related items and upscale "gentlemen's
accessories" and are located in malls in Connecticut, Illinois, Maryland,
Massachusetts, Michigan and Ohio. The terms of the merger were negotiated on an
arms length basis by representatives of the constituent corporations.
Item 4. Changes in Registrant's Certifying Accountant
On January 13, 1998, the firm of Harvey Judkowitz, C.P.A. ("Judkowitz")
was dismissed as the Registrant's independent auditor. The Board of Directors
has approved Coopers & Lybrand L.L.P. as independent auditors for the year ended
January 31, 1998 at the Board of Directors meeting on January 13, 1998.
The reports of Judkowitz on the Registrant's financial statements for
the past two fiscal years did not contain any adverse opinion nor a disclaimer
of opinion and were not qualified or modified as to uncertainty, audit scope or
accounting principles.
In connection with the audits of the Registrant's financial statements
for each of the two fiscal years ended September 30, 1997 and in the subsequent
interim period preceding Judkowitz's dismissal there were no disagreements on
any matters of accounting principles or practices, financial statement
disclosure or auditing scope or procedure which if not resolved to the
satisfaction of Judkowitz would have caused Judkowitz to make references to the
matter in its report.
The Registrant has requested Judkowitz to furnish it with a letter
addressed to the Securities and Exchange Commission ("SEC") stating whether
Judkowitz agrees with the statements set forth above in this Item 4. A copy of
that letter will be filed with the SEC promptly upon receipt from Judkowitz.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits
(a) Financial Statements of Businesses Acquired:
These will be provided within 60 days after the filing of this
Form 8-K.
(b) Pro Forma Financial Information:
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This will be provided within 60 days after the filing of this
Form 8-K.
Item 8. Change in Fiscal Year
On December 31, 1997, in connection with the merger of Woodfield with
and into the Registrant, the Registrant changed its fiscal year end to January
31. The report covering the transition period will be filed on Form 10-QSB.
Exhibits:
2.1 Agreement and Plan of Merger among Windsor Capital Corp. and
Woodfield Enterprises, Inc. and International Asset Management
Group, Inc., dated December 18, 1997.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Windsor Capital Corp.
January 14, 1998 By: /s/ GARY N. MANSFIELD
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Gary N. Mansfield
Chief Executive Officer
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EXHIBIT INDEX
EXHIBIT DESCRIPTION
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2.1 Agreement and Plan of Merger among Windsor Capital Corp.
and Woodfield Enterprises, Inc. and International Asset
Management Group, Inc., dated December 18, 1997.
AGREEMENT AND PLAN OF MERGER
This Agreement and Plan of Merger is entered into as of the 18th day of
December, 1997, by and among Windsor Capital Corporation, a Delaware corporation
("WCC" or "Surviving Corporation"); International Asset Management Group, Inc.,
a Delaware corporation as majority shareholder of WCC ("IAMG"); and Woodfield
Enterprises, Inc., a Florida corporation ("Woodfield"). WCC and Woodfield are
sometimes hereinafter collectively referred to as the "Constituent
Corporations."
RECITALS:
WHEREAS, the boards of directors of WCC and Woodfield, respectively,
deem it advisable and in the best interests of such corporations and their
respective shareholders that Woodfield merge with and into WCC pursuant to this
Agreement and the Plan and Articles of Merger in the form attached hereto as
Exhibit "A" and pursuant to applicable provisions of law (the "Merger");
WHEREAS, WCC has an authorized capitalization consisting of 25,000,000
shares of $.001 par value common stock ("WCC Common Stock"), of which 5,525,000
shares are issued and outstanding as of the date hereof, and 10,000,000 shares
of $.01 par value preferred stock, none of which are issued and outstanding as
of the date hereof; and Woodfield has an authorized capitalization consisting of
20,000,000 shares of common stock, $.001 par value ("Woodfield Common Stock"),
of which 6,200,000 shares are issued and outstanding as of the date hereof (the
"Woodfield Historical Shares"). All of said Woodfield Historical Shares are
owned by the shareholders of Woodfield as set forth on the attached Exhibit "B"
(the "Woodfield Historical Shareholders");
NOW THEREFORE, for the mutual consideration set out herein, and other
good and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties agree that the foregoing recitals are true and correct
and further agree as follows:
AGREEMENT
1. PLAN OF MERGER. The parties agree that Woodfield shall be merged
with and into WCC upon the terms and conditions set forth herein. It is the
intention of the parties that this transaction qualify as a tax-free
reorganization under Section 368(a) of the Internal Revenue Code of 1986, as
amended, and related sections thereunder.
2. TERMS OF MERGER. In accordance with the provisions of this Agreement
and the requirements of applicable law, Woodfield shall be merged with and into
WCC as of the Effective Time (as defined in Section 6 hereof), WCC shall be the
Surviving Corporation and the separate existence of Woodfield shall cease as of
the Effective Time. Consummation of the Merger shall be upon the following terms
and subject to the following conditions:
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(a) Corporate Existence
(1) From and after the Effective Time, WCC as the Surviving
Corporation shall continue its corporate existence as a Delaware corporation and
(i) it shall thereupon and thereafter possess all rights, privileges, powers,
franchises and property (real, personal and mixed) of each of the Constituent
Corporations; (ii) all debts due to either of the Constituent Corporations, on
whatever account, all causes of action and all other things belonging to either
of the Constituent Corporations shall be taken and deemed to be transferred to
and shall be vested in the Surviving Corporation by virtue of the Merger without
further act or deed; (iii) the title to any real estate vested by deed or
otherwise, under the laws of any jurisdiction, in either of the Constituent
Corporations, shall not revert or be in any way impaired by reason of the
Merger; and (iv) all rights of creditors and all liens upon any property of any
of the Constituent Corporations shall be preserved unimpaired, and all debts,
liabilities, obligations and duties of the Constituent Corporations shall
thenceforth attach to the Surviving Corporation and may be enforced against it
to the same extent as if such debts, liabilities, obligations and duties had
been incurred or contracted by the Surviving Corporation.
(2) From and after the Effective Time, (i) the Certificate of
Incorporation and Bylaws of WCC, as existing immediately prior to the Effective
Time, shall be the Certificate of Incorporation and By-Laws of the Surviving
Corporation subject to amendments adopted in the Plan and Articles of Merger and
any subsequent amendments; (ii) the members of the Board of Directors of
Woodfield holding office immediately prior to the Effective Time shall become
the members of the Board of Directors of the Surviving Corporation, each to
serve subject to the Surviving Corporation's by-laws; (iii) WCC shall change its
name to Prodx Corp.; and (iv) all persons who hold executive offices of
Woodfield at the Effective Time shall be elected by the board of directors of
the Surviving Corporation to hold the same offices of the Surviving Corporation,
each to serve subject to the Surviving Corporation's by-laws.
(b) Pre-Merger Events and Recapitalizations.
(1) Prior to Closing, Woodfield shall have completed the sale
in its ongoing private placement (the "Private Placement") of at least 1,600,000
and not more than 2,100,000 shares (the "Offering") of Woodfield's Common Stock
pursuant to Woodfield's Confidential Private Placement Memorandum dated November
10, 1997, together with all amendments thereof and supplements and exhibits
thereto (the "Memorandum").
(2) WCC shall have effectuated a recapitalization, including a
sale by IAMG to Woodfield of 5,000,000 WCC Class A Warrants at $.01 each and
4,480,000 shares of WCC Common Stock at $.025 per share and the cancellation of
such shares and warrants by Woodfield, whereby at or prior to closing the
Merger, WCC shall have 1,045,000 shares of WCC Common Stock issued and
outstanding, of which IAMG shall own 355,000 and other WCC shareholders shall
own 690,000, and 500,000 Class A Warrants held by persons other than IAMG, and
no other shares or warrants for shares of capital stock issued or outstanding.
Such 690,000 shares of WCC Common Stock and 500,000 Class A Warrants to purchase
WCC Common Stock are
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held as of the date of this Agreement and shall be held as of the Effective Time
as set forth on Exhibit "C" attached hereto.
(c) Conversion of Securities.
As of the Effective Time each of the following shall occur without any
action on the part of WCC, Woodfield or the holders of any of the securities of
either of the Constituent Corporations:
(1) Each of the shares of Woodfield Common Stock issued and
outstanding immediately prior to the Effective Time (the "Woodfield Shares")
shall be converted into one share of WCC Common Stock. All such shares of
Woodfield Common Stock shall no longer be outstanding and shall automatically be
canceled and shall cease to exist, and each certificate previously evidencing
any such shares shall thereafter represent the right to receive, upon the
surrender of such certificate in accordance with the provisions of Section 3
hereof, certificates evidencing such number of shares of WCC Common Stock into
which such shares of Woodfield Common Stock were converted. The holders of such
certificates previously evidencing shares of Woodfield Common Stock outstanding
immediately prior to the Effective Time shall cease to have any rights with
respect to such shares of Woodfield Common Stock except as otherwise provided
herein or by law;
(2) Any shares of Woodfield Common Stock held in the treasury
of Woodfield immediately prior to the Effective Time shall automatically be
canceled and extinguished without any conversion thereof and no payment shall be
made with respect thereto;
(3) In fulfillment of the obligation of Woodfield to issue
540,000 shares of Woodfield Common Stock upon exercise of the warrants described
on Exhibit "B" (the "Woodfield Warrants"), WCC shall issue on the terms and
subject to the conditions set forth in the Warrant Certificate included in
Exhibit "B", shares of WCC Common Stock on the basis of one share of WCC Common
Stock for each share of Woodfield Common Stock.
(4) The 1,045,000 shares of WCC Common Stock previously issued
and outstanding prior to the Merger will remain issued and outstanding;
(5) At Closing, there shall be no securities convertible into
or exercisable or exchangeable for shares of Woodfield Common Stock except as
described in Exhibit "B" attached hereto and by this reference incorporated
herein.
(d) Assumption of Obligations.
As of the Effective Time:
(1) WCC shall assume all of Woodfield's obligations relating
to the Woodfield Warrants so that such securities shall become securities of
WCC. Each Woodfield Warrant shall
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continue to have, and be subject to, the same terms and conditions set forth in
the certificate for the Woodfield Warrants. WCC shall reserve for issuance the
number of shares of WCC Common Stock that will become issuable upon the exercise
of such Woodfield Warrants pursuant to this Section 2(d);
(2) The Plan and Articles of Merger shall amend the
Certificate of Incorporation of WCC to change its corporate name to "Prodx
Corp."
(e) Other Matters.
(1) Except for the recapitalization of WCC, there shall be no
stock dividend, stock split, recapitalization, or exchange of shares with
respect to or rights issued in respect of, WCC's capital stock after the date
hereof and there shall be no dividends paid on WCC's capital stock after the
date hereof, in each case through and including the Effective Time.
(2) Woodfield shall have received all requisite director and
shareholder approval of all matters set forth herein and Woodfield Shareholders
shall not have exercised any dissenter's rights under applicable corporate law
with respect to more than 25,000 shares of Woodfield Common Stock.
(3) WCC shall have received all requisite director and
shareholder approval of all matters set forth herein and WCC shareholders shall
not have exercised any dissenter's rights under applicable corporate law with
respect to more than 35,000 shares of WCC Common Stock.
(4) IAMG agrees, subject to the terms hereof, to vote its
shares of WCC Common Stock in favor of the matters described herein pursuant to
a written consent dated as of the date of this Agreement.
(5) WCC and Woodfield shall provide appropriate and timely
notices to their respective shareholders relating to the proposed Merger in
accordance with applicable Delaware and Florida law, respectively, so that all
dissenter's rights must be exercised or expire prior to January 22, 1998.
(6) To the extent any shareholder of one of the Constituent
Corporations exercises dissenting shareholder rights beyond the limits set forth
above, Woodfield may elect, by written notice delivered within 5 days after such
exercise, to terminate this Agreement.
3. DELIVERY AND EXCHANGE OF SHARES. At or as soon as practicable after
the Effective Date:
(a) Woodfield will use its best efforts to cause the Woodfield
Stockholders to surrender for cancellation certificates or instruments
representing their shares of Woodfield Common Stock and Woodfield Warrants,
against delivery of like securities of WCC for which the Woodfield securities
are to be converted in the Merger. Until surrendered and exchanged as herein
provided,
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each outstanding instrument which, prior to the Effective Time, represented a
Woodfield security shall be deemed for all corporate purposes to evidence a like
security of WCC into which the Woodfield security shall have been so converted.
(b) On or before Closing, WCC shall direct its transfer agent to issue
or shall directly issue, as soon as practicable, all WCC Common Stock and
Warrants as described herein upon delivery for exchange of the corresponding
Woodfield Shares and Warrants and such direction shall constitute delivery of
such securities for purposes of completing the Merger.
4. REPRESENTATIONS OF WOODFIELD. Woodfield hereby represents and
warrants as of the date hereof as follows, which representations and warranties
shall also be true as of the Effective Time:
(a) Woodfield's authorized capital stock consists of 20,000,000 shares
of common stock, $.001 par value, of which 6,200,000 shares are issued and
outstanding. The Woodfield Stockholders listed on the attached Exhibit "B" are
the sole owners of record and beneficially of the issued and outstanding common
stock and warrants of Woodfield. Woodfield has no other shares of common stock
or warrants outstanding. Woodfield will not sell or issue more than 500,000
additional shares of Woodfield Common Stock pursuant to the Private Placement or
otherwise.
(b) The Woodfield Common Stock constitutes duly authorized, validly
issued capital shares of Woodfield, fully-paid and nonassessable.
(c) The current unaudited financial statements as of September 30,
1997, and the audited financial statements as of December 31, 1996, of Woodfield
which have been delivered to WCC and are attached hereto as Exhibit "D"
(hereinafter collectively referred to as the "Woodfield Financial Statements")
are complete, accurate and fairly present the financial condition of Woodfield
as of the dates thereof and the results of its operations for the periods
covered, subject, in the case of the unaudited interim statements, to normal
year-end audit adjustments. There are no material liabilities or obligations,
either fixed or contingent, not disclosed in the Woodfield Financial Statements
or in any exhibit thereto or notes thereto other than contracts or obligations
in the ordinary course of business; and no such contracts or obligations in the
ordinary course of business constitute liens or other liabilities which
materially alter the financial condition of Woodfield as reflected in the
Woodfield Financial Statements. Woodfield has good title to all assets shown on
the Woodfield Financial Statements subject only to dispositions and other
transactions in the ordinary course of business, the disclosures set forth
therein and liens and encumbrances of record. The audited financial statement of
Woodfield have been prepared in accordance with generally accepted accounting
principles consistently applied (except as may be indicated therein or in the
notes thereto).
(d) Since September 30, 1997, there have not been any material adverse
changes in the financial position of Woodfield except as set forth in the
Memorandum and except for the change
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in Woodfield's capitalization resulting from the sale of at least 1,600,000 and
not more than 2,100,000 shares of Woodfield Common Stock pursuant to the Private
Placement.
(e) Woodfield is not a party to any material pending litigation or, to
its best knowledge, any governmental investigation or proceeding, not reflected
in the Woodfield Financial Statements, and to its best knowledge, no material
litigation, claims, assessments or any governmental proceedings are threatened
or contemplated against Woodfield or respecting the transactions contemplated by
this Agreement. Woodfield is in good standing in its state of incorporation, and
is in good standing and duly qualified to do business in each state where
required to be so qualified except where the failure to so qualify would have no
material adverse effect on Woodfield.
(f) Woodfield has (or, by the Effective Time, will have filed) all
material tax, governmental and/or related forms and reports (or extensions
thereof) due or required to be filed and has (or will have) paid or made
adequate provisions for all taxes or assessments which have become due as of the
Effective Time.
(g) Woodfield has not materially breached any material agreement to
which it is a party. Woodfield has previously given WCC copies or access thereto
of all material contracts, commitments and/or agreements to which Woodfield is a
party including all relationships or dealings with related parties or
affiliates.
(h) Woodfield has no subsidiary corporations.
(i) Woodfield has made and hereby agrees to make its corporate
financial records, minute books, and other corporate documents and records
available for review to present management of WCC prior to the Effective Time,
during reasonable business hours and on reasonable notice.
(j) The execution of this Agreement does not, and the consummation of
the transactions contemplated hereby, will not, materially violate or breach any
material agreement or contract to which Woodfield is a party and has been duly
authorized by all appropriate and necessary corporate action and by Woodfield's
shareholders to the extent required.
(k) Woodfield need not obtain the consent of any individual, firm,
corporation, partnership, limited liability company, association, trust, estate,
court, arbitrator, tribunal, governmental, quasi-governmental or public agency,
commission, board, bureau, instrumentality, authority of any other entity to
enter into this Agreement or consummate the transactions contemplated hereby.
(l) All information regarding Woodfield which is set forth in the
Memorandum or otherwise used in connection with the Private Placement is true,
complete and accurate in all material respects as of the date of the Memorandum
and the Effective Time, except as set forth in Exhibit "E" attached hereto.
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5. REPRESENTATIONS OF WCC AND IAMG. WCC and IAMG hereby jointly and
severally represent and warrant as of the date hereof as follows, each of which
representations and warranties shall continue to be true as of the Effective
Time:
(a) As of the Closing, the shares of WCC Common Stock, to be issued and
delivered to the Woodfield Shareholders hereunder and upon exchange, prepayment,
exercise or conversion of any instrument delivered hereunder will, when so
issued and delivered, constitute, duly authorized, validly and legally issued
shares of WCC Common Stock, fully-paid and nonassessable. All other securities
of WCC to be delivered hereunder have been duly authorized and validly and
legally issued.
(b) WCC has the corporate power to enter into this Agreement and to
perform its obligations hereunder. The execution and delivery of this Agreement
and the consummation of the transactions contemplated hereby have been duly
authorized by the Board of Directors of WCC and, to the extent required by
applicable law, as of the closing will have been approved by the shareholders of
WCC. The execution and performance of this Agreement will not constitute a
material breach of any agreement, indenture, mortgage, license or other
instrument or document to which WCC is a party and will not violate any
judgment, decree, order, writ, rule, statute, or regulation applicable to WCC or
its properties. The execution and performance of this Agreement will not violate
or conflict with any provision of the certificate of incorporation or by-laws of
WCC.
(c) WCC has delivered to Woodfield a true and complete copy of its
Annual Report on Form 10-KSB for the year ended September 30, 1997, as filed
with the Securities and Exchange Commission (the "Commission") (the "1997
10-KSB") and its audited financial statements as of and for the year ended
September 30, 1997, a copy of which is attached hereto as Exhibit "F" (the "WCC
Financial Statements"). As of the date of this Agreement, the 1997 10-KSB does
not contain any untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they were made, not misleading. The
WCC Financial Statements have been prepared in accordance with generally
accepted accounting principles applied on a consistent basis (except as may be
indicated therein or in the notes thereto) and fairly present the financial
position of WCC as of September 30, 1997 and the results of its operations and
changes in financial position for the year then ended.
(d) Since September 30, 1997, there have not been any material adverse
changes in the financial condition of WCC.
(e) WCC is not a party to or the subject of any pending litigation,
claims, or governmental investigation or proceeding not reflected in the WCC
Financial Statements or otherwise disclosed herein, and there are no lawsuits,
claims, assessments, investigations, or similar matters, to the best knowledge
of WCC or IAMG, threatened or contemplated against or affecting WCC, its
properties or respecting the transactions contemplated by this Agreement.
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(f) WCC is duly organized, validly existing and in good standing under
the laws of the State of Delaware and has the corporate power to own its
property and to carry on its business as now being conducted and is duly
qualified to do business in any jurisdiction where so required except where the
failure to so qualify would have no material adverse effect.
(g) WCC has filed all federal, state, county and local income, excise,
property and other tax, governmental and/or related returns, forms, or reports,
which are due or required to be filed by it prior to the date hereof and has
paid or made adequate provision in the WCC Financial Statements for the payment
of all taxes, fees, or assessments which have or may become due pursuant to such
returns or pursuant to any assessments received. WCC is not delinquent or
obligated for any tax, penalty, interest, delinquency or charge.
(h) WCC's authorized capital stock consists of: (i) 25,000,000 shares
of Common Stock, $.001 par value, of which 5,525,000 shares are presently issued
and outstanding, and 10,000,000 shares of preferred stock, $.01 par value, none
of which are issued and outstanding. All outstanding shares of common stock of
WCC are validly issued, fully-paid and nonassessable. There are no existing
options, calls, warrants, preemptive rights or commitments of any character
relating to the issued or unissued capital stock or other securities of WCC
except for the 5,500,000 Class A Warrants. The ownership of WCC's Common Stock
and Warrants is accurately set forth on Exhibit "C" attached hereto.
(i) The corporate financial records, minute books, and other documents
and records of WCC have been made and shall continue to be made available to
Woodfield prior to the Closing.
(j) WCC has not breached, nor is there any pending, or to the knowledge
of management, any threatened claim that WCC has breached, any of the terms or
conditions of any agreements, contracts or commitments to which it is a party or
by which it or its properties is bound. The execution and performance of this
Agreement will not violate any provisions of applicable law or any agreement to
which WCC is subject. WCC hereby represents that it is not a party to any
material contract or commitment other than appointment documents with its
transfer agent, and that it has disclosed to Woodfield all relationships or
dealings with related parties or affiliates.
(k) WCC need not obtain the consent of any individual, firm,
corporation, partnership, limited liability company, association, trust, estate,
court, arbitrator, tribunal, governmental, quasi-governmental or public agency,
commission, board, bureau, instrumentality, authority or any other entity to
enter into this Agreement or consummate the transactions contemplated hereby.
(l) WCC has complied with the provisions for registration, or exemption
therefrom, under the Securities Act of 1933, as amended, and all applicable blue
sky laws in connection with its initial public stock offering and all other
sales of securities. There are no outstanding, pending or threatened stop orders
or other actions relating thereto. WCC is current with respect to all applicable
filing requirements with the Commission.
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(m) The WCC Common Stock is currently eligible for quotation on the
NASD Electronic Bulletin Board and there are no stop orders in effect with
respect thereto.
(n) All information regarding WCC which is set forth in the 1997 10-KSB
and the WCC Financial Statements is true, complete and accurate in all material
respects as of this date and the Effective Time except that, since September 30,
1997, (i) WCC has earned interest and/or dividends on its investments and (ii)
WCC has paid or will pay expenses, including but not limited to expenses
incurred in connection with this Agreement and the Merger, not to exceed $6,000
in the aggregate. WCC has not made and will not make any other payments or incur
any other liabilities prior to the Effective Time.
6. EFFECTIVE TIME: Closing. Subject to the conditions precedent outline
herein, on such date as is mutually determined by Woodfield, WCC and IAMG but in
any event on or before January 22, 1998, WCC shall cause to be filed an executed
copy of the Plan and Articles of Merger with the appropriate offices of both the
State of Delaware and the State of Florida at which time (the "Effective Time")
the Merger shall become effective (the "Closing" or "Closing Date").
7. CONDITIONS PRECEDENT TO THE OBLIGATIONS OF WOODFIELD. All
obligations of Woodfield under this Agreement are subject to the fulfillment
unless waived by Woodfield, prior to or at the Closing and/or the Effective
Time, as indicated below, of each of the following conditions:
(a) The representations and warranties by or on behalf of IAMG and WCC
contained in this Agreement or in any certificate or document delivered pursuant
to the provisions hereof shall be true in all material respects at the Effective
Time and Closing as though such representations and warranties were made at and
as of such time.
(b) WCC shall have performed and complied with all covenants,
agreements, and conditions set forth in, and shall have executed and delivered
all documents required by this Agreement to be performed or complied with or
executed and delivered by it prior to or at the Effective Time and/or the
Closing as the case may be.
(c) On or before the Effective Time, the Board of Directors and
shareholders of WCC shall have approved in accordance with applicable state
corporation law the execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby , WCC shareholders shall
not have exercised any dissenter's rights with respect to more than 35,000
shares of WCC Common Stock, and Woodfield shareholders shall not have exercised
any dissenter's rights with respect to more than 25,000 shares of Woodfield
Common Stock.
(d) On or before the Effective Time, WCC shall have delivered certified
copies of resolutions of the Board of Directors and shareholders of WCC
approving and authorizing the execution, delivery and performance of this
Agreement and authorizing all of the necessary and proper action to enable WCC
to comply with the terms of this Agreement including the election of Woodfield's
nominees to the Board of Directors of WCC and all matters outlined herein.
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(e) Prior to the Effective Time all applicable matters described in
this Agreement shall have been approved by the stockholders of WCC in accordance
with applicable law.
(f) At the Effective Time the Merger shall be permitted by applicable
state law and WCC shall have sufficient shares of its capital stock authorized
to complete the Merger.
(g) At the closing, IAMG shall cause WCC's Robert M. Leopold, Dolores
Cippalone and Steven Gordon to resign in writing from their positions as
officers and directors of WCC upon the election and appointment of the Woodfield
nominees as directors and officers of WCC.
(h) At the Closing, all instruments and documents delivered to
Woodfield Shareholders pursuant to the provisions hereof shall be reasonably
satisfactory to legal counsel for Woodfield.
(i) At the Effective Time, WCC shall have the same authorized capital
as of the date hereof.
(j) The shares of restricted WCC capital stock to be issued to the
Woodfield Shareholders at Closing will be validly issued, nonassessable and
fully-paid under Delaware corporation law and will be issued in a nonpublic
offering and isolated transaction in compliance with all applicable federal and
state securities laws.
(k) Prior to the Effective Time, Woodfield shall have received all
necessary and required approvals and consents from required parties and its
shareholders.
(l) Prior to the Effective Time, WCC shall have delivered to Woodfield
an opinion of its counsel dated as of the Closing Date to the effect that:
(i) WCC is a corporation duly organized, validly existing and
in good standing under the laws of the State of Delaware;
(ii) This Agreement has been duly authorized, executed and
delivered by WCC, and is a valid and binding obligation of WCC enforceable in
accordance with its terms;
(iii) WCC through its Board of Directors and shareholders has
taken all corporate action necessary for performance under this Agreement;
(iv) The documents executed and delivered to Woodfield and the
Woodfield Shareholders hereunder are valid and binding in accordance with their
terms and vest in the Woodfield Shareholders, as the case may be, all right,
title and interest in and to the shares of WCC's Common Stock to be issued
pursuant to Section 2 hereof, and the shares of WCC Common Stock when issued
will be duly and validly issued, fully-paid and nonassessable; and
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(v) WCC has the corporate power to execute, deliver and
perform under this Agreement.
(vi) Legal counsel for WCC is not aware of any liabilities,
claims or lawsuits involving WCC, except as set forth in WCC's Form 10-KSB for
the year ended September 30, 1997.
(vii) In connection with the issuance of WCC securities to
persons who were holders of Woodfield Warrants, the shares of WCC Common Stock
issuable upon exercise of such warrants have been duly authorized for issuance
and reserved by WCC and will, when issued and delivered, against payment of the
consideration therefor, be validly issued and outstanding, fully-paid and
nonassessable, and will not be subject to preemptive rights.
(n) Immediately prior to the Effective Time, WCC shall have assets
consisting of at least $645,000 in cash and/or money market funds plus interest
and dividends earned since September 30, 1997, and liabilities not to exceed
$6,000 less payments made since September 30, 1997.
8. CONDITIONS PRECEDENT TO THE OBLIGATIONS OF WCC. All obligations of
WCC under this Agreement are subject to the fulfillment, unless waived by WCC,
prior to or at the Closing, of each of the following conditions:
(a) The representations and warranties by Woodfield contained in this
Agreement or in any certificate or document delivered pursuant to the provisions
hereof shall be true in all material respects at and as of the Closing as though
such representations and warranties were made at and as of such time.
(b) Woodfield shall have performed and complied with, in all material
respects, all covenants, agreements, and conditions required by this Agreement
to be performed or complied with by them prior to or at the Closing;
(c) Woodfield shall have raised gross proceeds of at least $1,600,000
in the Private Placement.
(d) Woodfield shall deliver an opinion of its legal counsel to the
effect that:
(i) Woodfield is a corporation duly organized, validly
existing and in good standing under the laws of the state of Florida and is duly
qualified to do business in any jurisdiction so required except where the
failure to so qualify would have no material adverse impact on the company;
(ii) Woodfield has the corporate power to carry on its
business as now being conducted; and
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(iii) This Agreement has been duly authorized, executed and
delivered by Woodfield.
9. LOCKUP. IAMG agrees that the 355,000 shares of WCC Common Stock held
by it as of the Effective Time will be subject to a lockup whereby they may not
be sold except in increments of 177,500, 88,750 and 88,750 shares, which shall
be released from the lockup six, nine and 12 months after the Effective Time,
respectively. WCC shall cause its transfer agent to place appropriate
restrictive legends on the certificates for such shares.
10. INDEMNIFICATION. For a period of two years from the Closing, IAMG
and WCC agree to jointly and severally indemnify and hold harmless Woodfield and
Woodfield agrees to indemnify and hold harmless IAMG and WCC, against and in
respect of any liability, damage or deficiency, all actions, suits, proceedings,
demands, assessments, judgments, costs and expenses including attorney's fees
incident to any of the foregoing, resulting from any material misrepresentations
made by an indemnifying party to an indemnified party, an indemnifying party's
breach of covenant or warranty or an indemnifying party's nonfulfillment of any
agreement hereunder, or from any material misrepresentation in or omission from
any certificate or document furnished or to be furnished hereunder; provided,
however, that such indemnification with respect to liability, damages, claims
and losses arising more than six months after the closing shall apply only to
amounts in excess of $5000.
11. NATURE AND SURVIVAL OF REPRESENTATIONS. All representations,
warranties and covenants made by any party in this Agreement shall survive the
Closing and the consummation of the transactions contemplated hereby for two
years from the Closing. All of the parties hereto are executing and carrying out
the provisions of this Agreement in reliance solely on the representations,
warranties and covenants and agreements contained in this Agreement and not upon
any investigation upon which it might have made or any representation, warranty,
agreement, promise or information, written or oral, made by the other party or
any other person other than as specifically set forth herein.
12. DOCUMENTS AT CLOSING. At the Closing, the following documents shall
be delivered:
(a) Woodfield will deliver, or will cause to be delivered, to WCC the
following:
(i) a certificate executed by the Chief Executive Officer and
Secretary of Woodfield to the effect that all representations and warranties
made by Woodfield under this Agreement are true and correct as of the Closing,
the same as though originally given to WCC on said date;
(ii) a certificate from the State of Florida dated at or about
the Closing to the effect that Woodfield is in good standing under the laws of
said State;
(iii) such other instruments, documents and certificates, if
any, as are required to be delivered pursuant to the provisions of this
Agreement;
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(iv) executed copies of the Plan and Articles of Merger for
filing at Closing and certified copies of resolutions by the shareholders and
directors of Woodfield authorizing the Merger;
(vi) all other items, the delivery of which is a condition
precedent to the obligations of WCC, as set forth herein; and
(vii) the legal opinion required by Section 8(d) hereof.
(b) WCC will deliver or cause to be delivered to Woodfield:
(i) instructions to its transfer agent to issue certificates
representing the Common Stock, the WCC Warrants, and any other instruments, to
be issued as a part of the exchange as described in Section 2 hereof;
(ii) a certificate of the Chairman of WCC to the effect that
all representations and warranties of WCC made under this Agreement are true and
correct as of the Closing, the same as though originally given to Woodfield on
said date;
(iii) certified copies of resolutions adopted by WCC's Board
of Directors and IAMG authorizing the Merger and all related matters;
(iv) a certificate from the State of Delaware dated at or
about the Closing Date that WCC is in good standing under the laws of said
State;
(v) the opinion of WCC's counsel as described in Section 7(l)
above;
(vi) such other instruments and documents as are required to
be delivered pursuant to the provisions of this Agreement;
(vii) resignations of Robert M. Leopold, Steven Gordon and
Dolores Cippalone from their positions as officers and directors of WCC; and
(viii) all other items, the delivery of which is a condition
precedent to the obligations of Woodfield, as set forth in Section 8 hereof.
13. FINDER'S FEES. IAMG and WCC, jointly and severally, represent and
warrant to Woodfield, and Woodfield represents and warrants to each of IAMG and
WCC, that none of them, or any party acting on their behalf, has incurred any
liabilities, either expressed or implied, to any "broker" or "finder" or similar
person in connection with this Agreement or any of the transactions contemplated
hereby. In this regard, IAMG and WCC, jointly and severally, on the one hand,
and Woodfield on the other hand, will indemnify and hold the other harmless from
any claim, loss, cost or expense whatsoever (including reasonable fees and
disbursements of counsel) from or relating to any such express or implied
liability.
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14. INVESTMENT LETTER. Woodfield shall use its best efforts to promptly
obtain from each Woodfield shareholder an investment letter in the form attached
hereto as Exhibit "G". The certificates for Surviving Corporation Common Stock
issued pursuant to the Merger shall contain the restrictive legend set forth in
the investment letter.
15. MISCELLANEOUS.
(a) FURTHER ASSURANCES. At any time, and from time to time. after the
Closing Date, each party will execute such additional instruments and take such
action as may be reasonably requested by the other party to confirm or perfect
title to any property transferred hereunder or otherwise to satisfy the
conditions and/or carry out the intent and purposes of this Agreement.
(b) WAIVER. Any failure on the part of any party hereto to comply with
any of its obligations, agreements or conditions hereunder may be waived in
writing by the party to whom such compliance is owed.
(c) TERMINATION. All obligations hereunder may be terminated at the
discretion of either party's Board of Directors if (i) the closing conditions
specified in Sections 7 and 8 are not met by January 22, 1998, unless
unanimously extended, or (ii) any of the representations and warranties made
herein have been materially breached.
(d) AMENDMENT. This Agreement may be amended only in writing as agreed
to by all parties hereto.
(e) NOTICES. All notices and other communications hereunder shall be in
writing and shall be deemed to have been given if delivered in person, by fax or
sent by prepaid first class registered or certified mail, return receipt
requested.
(f) HEADINGS. The section and subsection headings in this Agreement are
inserted for convenience only and shall not affect in any way the meaning or
interpretation of this Agreement.
(g) COUNTERPARTS. This Agreement may be executed simultaneously in two
or more counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
(h) EFFECT. This Agreement shall be binding upon the parties hereto and
inure to the benefit of the parties, their respective heirs, administrators,
executors, successors and assigns.
(i) ENTIRE AGREEMENT. This Agreement and the attached Exhibits
including the Plan and Articles of Merger attached hereto as Exhibit "A"
constitute the entire agreement of the parties covering everything agreed upon
or understood in the transaction. There are no oral promises, conditions,
representations, understandings, interpretations or terms of any kind as
conditions or inducements to the execution hereof.
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(j) TIME. Time is of the essence.
(k) SEVERABILITY. If any part of this Agreement is deemed to be
unenforceable the balance of the Agreement shall remain in full force and
effect.
(l) RESPONSIBILITY AND COSTS. If the Merger is consummated, all
reasonable fees, expenses and out-of-pocket costs and expenses shall be borne by
the Surviving Corporation, subject to the limitation set forth in Section 5(n).
If the Merger is terminated prior to the Effective Time all fees, expenses and
out-of-pocket costs and expenses, including, without limitation, fees and
disbursements of counsel, financial advisors and accountants, incurred by the
parties hereto shall be borne solely and entirely by the party that has incurred
such costs and expenses unless such party has agreed otherwise with any such
person.
(m) LITIGATION. In the event of litigation arising under this
Agreement, the prevailing party shall be entitled to recover from the
non-prevailing party its reasonable attorneys' fees and expenses incurred in
connection with such litigation at all levels, including prior to commencement
of such litigation.
IN WITNESS WHEREOF, the parties have executed this Agreement the day
and year first above written.
WOODFIELD ENTERPRISES, INC.
By: /s/ Gary N. Mansfield
-------------------------------
Gary N. Mansfield,
Chief Executive Officer
WINDSOR CAPITAL CORPORATION
By: /s/ Robert M. Leopold
-------------------------------
President
INTERNATIONAL ASSET MANAGEMENT
GROUP, INC.
By: /s/ Hershel Krasnow
-------------------------------
Director
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