UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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): September 30, 1996
HEART LABS OF AMERICA, INC.
(Exact name of registrant as specified in its Charter)
Florida 0-20356 65-0158479
(State or other jurisdiction (Commission file no.) (IRS Employer Id
of incorporation) Number)
1903 S. Congress Ave, Suite 400, Boynton Beach, Florida 33426
(Address of principal executive offices, including zip code)
Registrant's telephone number, including area code 561-737-2227
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ITEM 2. ACQUISITION AND DISPOSITION OF ASSETS.
(a) Description of Disposition
On September 30, 1996, the Company sold 1,436,080 shares of its
restricted common stock in Westmark Group Holdings, Inc. (NASDAQ-WGHI)
("Westmark") to GTB Company for $.675 per share in the form of a promissory
note. GTB Company's president was former general counsel to the Company.
The fair market value of the Westmark stock, discounted for the
restrictive nature, dictated the purchase price per share. The promissory note
is to be repaid, without interest, in installments secured and determined by the
net cash flow received by GTB Company from the contracts for the purchases of
devices manufactured by Green World Technologies, Inc. Net cash flow is defined
as 100% of the gross revenue minus the cost of goods sold up to a maximum of 15%
minus general, administrative and all other expenses up to a maximum of $60,000
per month. The Company will be paid 50% of the net cash flow as defined above.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(c) The following exhibits are filed as part of this Form 8-K
EXHIBIT
10.01 Agreement dated September 30, 1996, between the
Company and GTB Company
10.02 Promissory note dated September 30, 1996
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SIGNATURES
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.
Heart Labs of America, Inc.
Date: October 7, 1996 By: /s/ DAWN M. DRELLA
Dawn M. Drella
Chief Financial Officer
EXHIBIT 10.01
AGREEMENT
This Agreement is entered into this 30th day of September, 1996, by and
between HEART LABS OF AMERICA, INC. (HLOA), a Florida corporation, and GTB
COMPANY, a Florida corporation. The parties mutually convenant and agree as
follows:
1. GTB will purchase and HLOA will sell all of the restricted common stock
issued by Westmark Group Holdings, Inc., and currently held by HLOA. The number
of shares owned is believed to be 1,436,080.
2. The purchase price of the restricted stock is $.675 per share. The purchase
price is to be paid by a Promissory Note of even date submitted herewith.
3. HLOA will retain the right to find purchaser(s) for any or all of the stock
up until the time of the last payment is made through payment of the Note. If
HLOA finds such purchaser(s), HLOA will be entitled to all of the purchase
price.
4. HLOA will be paid from the net cash flow derived by Green World Technologies
from the operation of the two contracts executed by Trane AC Specialties and
Trane Pacific and two additional contracts expected to be executed within the
next two weeks, and also from any other revenue, and also from any other
contracts or purchase orders into which Green World Technologies enters. Net
cash flow is defined as 100% of the gross revenue minus the costs of goods sold
up to a maximum of 15% minus general, administrative and all other expenses up
to a maximum of $60,000 per month. HLOA will be paid 50% of the net cash flow as
defined above for the purchase of the stock.
5. HLOA will hold the shares and deliver them upon receipt of payment in good
funds of the sales price as GTB directs. HLOA will cause the number of shares
purchased by each payment to be delivered on the same business day that payment
is made. WGHI will give 48 hours prior written notice of receipt of funds to
HLOA. Upon receipt of good funds, shares will be delivered.
6. GTB hereby represents that it has full authority and ability to make this
contract and is entitled to receive the funds from Green World which it will
then transfer to HLOA.
7. It is understood between the parties that there was a certain anti-dilution
clause in a contract between HLOA and Westmark Group Holding, Inc. It is agreed
by the parties hereto that, once $500,000 has been paid to HLOA in exchange for
the stock of Westmark Group Holdings, Inc., which is the subject of this
contract, then the anti-dilution clause becomes void retroactive to July 29,
1996 for such shares. This is also true for shares sold pursuant to paragraph 3
above. If less than $500,000 is ultimately paid for the stock and the stock is
returned to HLOA then HLOA will continue to have an anti-dilution clause with
Westmark on a pro rata basis; that is, if 1,436,080 equals 100% of the holding
then any shares retained by HLOA will be a percentage of that holding, and HLOA
will be entitled to retain the anti-dilution clause in that same percentage.
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8. If GTB defaults on this contract, then the anti-dilution clause is reinstated
with WGHI on the same pro rata basis as set forth above.
9. GTB agrees not to use any amounts owed, if any, to GTB in previous
transactions as an offset to any monies owed in this transaction.
10. Facsimile signatures are acceptable and shall be acknowledged as the
original document.
11. Should any conflict arise from the terms of this Agreement or the Promissory
Note that is part of this Agreement, the terms of the Agreement shall prevail.
12. This contract shall be governed under the laws of the State of Florida.
Heart Labs of America, Inc. GTB Company
By:____________________ By:_________________________
Harry Kobrin, President Charles C. Chillingworth, President
Acknowledged by: Agreed:
Green World Technologies, Inc. Westmark Group Holdings, Inc.
By:_____________________ By:_________________________
Norman J. Birmingham, Mark Schaftlein,
Chairman of the Board Chief Operating Officer
EXHIBIT 10.02
PROMISSORY NOTE
$969,354 SEPTEMBER 30, 1996
WEST PALM BEACH, FLORIDA
FOR VALUE RECEIVED, the undersigned promises to pay to the order of
HEART LABS OF AMERICA, INC., ("HEART LABS"), the principal sum of NINE HUNDRED
SIXTY-NINE THOUSAND THREE HUNDRED FIFTY-FOUR AND NO/100 ($969,354.00) without
interest, in installments secured and determined by the net cash flow received
by GTB Company ("GTB") from the contracts for the purchases of devices
manufactured by Green World Technologies, Inc., (Green World") to be sold to
Trane AC Specialties and Trane Pacific, and the two additional contracts for the
sale of similar devices, expected to be executed within the next two weeks, and
all other contracts. Payments shall begin within thirty (30) days following the
generation of positive cash flow from Green World stemming from the foregoing
contracts. This Note shall be construed and enforced according to the laws of
the State of Florida. Payment of this promissory Note will originate from the
following sources:
1. The net cash flow from the aforementioned four (4) contracts, and
all other contracts, earned by Green World shall be applied to
this Note by GTB. Net cash flow is defined as 100% of the gross
revenue minus the costs of goods sold up to a maximum of 15%
minus general, administrative and all other expenses up to a
maximum of $60,000 per month. HLOA will be paid 50% of the net
cash flow as defined above for the purchase of the stock.
2. All funds received from the sale of any of the stock of Westmark
Group Holdings, Inc., which is being purchased with this
Promissory Note, will be applied to pay this Note.
3. If the aforementioned is not sufficient to pay this Note in full
prior to September 15, 1998, the remaining stock, to the value of
this Note, at $.675 per share, shall remain with Heart Labs.
GTB will supply Heart Labs, commencing October 31, 1996, with a net cash
flow statement from the sales by Green World for the month of September, and,
thereafter, shall submit cash flow statements of sales on a monthly basis on the
last day of the month following the month which is covered by the statement.
Payments, if any, shall accompany the cash flow statements.
If default be made in the payment of any of the sums mentioned herein,
or in the performance of any of the covenants contained herein, then the entire
unpaid principal sum shall, at the option of Heart Labs, be due and payable upon
ten (10) days prior written notice to GTB. Time being of the essence. The
principal unpaid sum shall bear interest from such time of default until paid at
a rate of interest equal to twelve (12%) percent. Failure to exercise this
option shall not constitute a waiver of the right to exercise the same in the
event of any subsequent default.
Each person liable hereon whether maker or endorser,hereby waives
presentment, protest, notice, notice of protest and notice of dishonor and
agrees to pay all costs, including a reasonable attorney's fees, whether suit be
brought or not, if any maturity of this Note or default hereunder, counsel shall
be employed to collect this Note or to protect the security of said liability.
ATTEST: GTB COMPANY
By:____________________________ By:______________________
Charles C. Chillingworth
Its: Secretary Its: President
SEAL
