SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
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Date of Report (Date of earliest event reported): June 13, 2003
Flexxtech Corporation
(Exact name of registrant as specified in its charter)
Nevada 000-25499 88-0390360
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(State or Other (Commission (IRS Employer
Jurisdiction of File Number) Identification No.)
Incorporation)
18 Technology Dr., Suite 140A
Irvine, CA 92618
Facsimile: (949)753-7499
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (949)753-7551
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS.
Pursuant to a Stock Purchase Agreement dated as of May 16, 2003 (the
"Purchase Agreement") by and between Flexxtech Corporation (the "Purchaser" or
the "Company"), a Nevada corporation and Michael Cummings an individual, (the
"Seller"), the owner of 100% of the outstanding shares of common stock of
Network Installation, Inc., a California corporation ("Network"), in which the
Purchaser acquired all of the outstanding shares of Network common stock
("Stock").
The purchase price consisted of fifty-thousand dollars in cash ($50,000)
and seven million three hundred eighty two thousand (7,382,000) shares of
Flexxtech Common Stock ("Flexxtech Stock"). In addition, Purchaser shall issue a
five year option to purchase an additional six hundred eighteen thousand
(618,000) shares of Flexxtech Stock to Seller if Network's total revenue exceeds
four hundred fifty thousand dollars ($450,000) for the period beginning on June
1, 2003 and ending August 31, 2003. The option is exercisable at a price equal
to the closing bid price of the Stock on August 31, 2003.
At the time of the acquisition there were no material relationships between
the Purchaser or any of its affiliates, any directors or officers, or any
associate of such director or officer, on the one hand, and the Seller, on the
other hand. As a result of the acquisition, Michael Cummings replaced Michael
Novielli as Chief Executive Officer and became a director of the Company. Mr.
Novielli will remain as Chairman of the Board of Directors.
The terms and conditions of the acquisition of the Stock are contained in
the Stock Purchase Agreement, which is attached hereto as Exhibit 2.1. The
foregoing description of the terms and conditions of the Stock Purchase
Agreement is qualified in its entirety by, and made subject to, the more
complete information set forth in the Stock Purchase Agreement.
ITEM 5. OTHER EVENTS AND REGULATION FD DISCLOSURE.
On May 23, 2003, the Company issued a press release related to the
Purchase Agreement. The press release, is filed as Exhibit 99.1.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(a) Financial Statements of Business Acquired.
The financial information required by this Item will be filed by an
amendment to this Current Report on Form 8-K within the time allowed for such
filing by Item 7(a)(4) of this Form.
(b) Pro Forma Financial Information.
The financial information required by this Item will be filed by an
amendment to this Current Report on Form 8-K within the time allowed for such
filing by Item 7(a)(4) of this Form.
(c) Exhibits.
2.1 Stock Purchase Agreement dated as of May 16, 2003 by and between
Flexxtech Corporation and Michael Cummings.
99.1 The Registrant's Press Release dated May 23, 2003.
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.
Flexxtech Corporation
(Registrant)
Date: June 13, 2003 /s/ Michael Cummings
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Name: Michael Cummings
Title: CEO and Director
EXHIBIT 2.1 STOCK PURCHASE AGREEMENT
THIS STOCK PURCHASE AGREEMENT ("Agreement") is made and entered into this
16th day of May, 2003, by and between Michael Cummings an individual,
(hereinafter referred to as the "Seller"), the owner of the shares of common
stock of Network Installation, Inc., a California corporation (the "Network"),
and Flexxtech Corporation, a Nevada corporation (hereinafter referred to as the
"Purchaser");
WITNESSETH:
WHEREAS, the Seller is the record owner and holder of an aggregate of
13,750 shares (the "Shares") which represents one hundred percent (100%) of the
issued and outstanding common stock of Network Installation, Inc. ("Network"), a
California corporation, representing 100% of the Corporation which Corporation
currently has authorized capital stock of an aggregate of 500,000 shares of
$0.001 par value common stock, as set forth in Exhibit "A" and
WHEREAS, the Purchaser desires to purchase the Shares, and the Seller
desires to sell or cause to be sold the Shares, upon the terms and subject to
the conditions herein.
NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained in this Agreement, and in order to consummate the purchase and the
sale of the Shares, it is hereby agreed as follows:
PURCHASE AND SALE: CLOSING.
A. PURCHASE AND SALE OF CORPORATION'S STOCK. Upon the date set forth in
this Agreement ("Closing Date"), and subject to the terms and conditions
hereinafter set forth, the Seller shall sell, convey and transfer, or cause to
be sold, conveyed or transferred, that number of the Shares of the Corporation's
Stock corresponding to 100% ownership of Network on the Closing Date as set
forth in Exhibit "A.
B. PROCEDURE FOR CLOSING. The closing of the transaction contemplated by
this Agreement ("Closing"), shall be held at Flexxtech's offices on or about May
16, 2003, at 5:00PM or such other place, date and time as the parties hereto may
otherwise agree.
AMOUNT AND PAYMENT OF PURCHASE PRICE. The total consideration and method of
payment thereof are in seven million three hundred eighty two thousand
(7,382,000) shares of Flexxtech Common Stock ("Stock"). In addition, Purchaser
shall issue a five year option to purchase an additional six hundred eighteen
thousand (618,000) shares of Stock to Seller if Network's total revenue exceeds
four hundred fifty thousand dollars ($450,000) for the period beginning on June
1, 2003 and ending August 31, 2003. The option is exercisable at a price equal
to the closing bid price of the Stock on August 31, 2003.
REPRESENTATIONS AND WARRANTIES OF SELLER. Seller hereby warrants and
represents:
A. AUTHORITY RELATIVE TO THIS AGREEMENT. Except as otherwise stated herein,
the Seller has full power and authority to execute this Agreement and carry out
the transactions contemplated by it and no further action is necessary by the
Seller to make this Agreement valid and binding upon Seller and enforceable
against them in accordance with the terms hereof, or to carry out the actions
contemplated hereby. The execution, delivery and performance of this Agreement
by the Seller will not:
i. constitute a breach or a violation of Seller's Certificate of
Incorporation, By-Laws, or of any law, agreement, indenture, deed of trust,
mortgage, loan agreement or other instrument to which it is a party, or by which
it is bound;
ii. constitute a violation of any order, judgment or decree to which it is a
party or by which its assets or properties are bound or affected; or
iii result in the creation of any lien, charge or encumbrance upon its
assets or properties, except as stated herein.
OWNERSHIP. All of such outstanding shares have been duly authorized, validly
issued and are fully paid and non-assessable, were not issued in violation of
the terms of any agreement or other understanding legally binding upon the
Corporation and were issued in compliance with all applicable laws and
regulations.
REVENUES. Seller represents and warrants that Network, Network Installation had
revenues of three hundred seventy four thousand one hundred seventy one
($374,171) and eight hundred four thousand and eighty dollars ($804,080) for the
years ended December 31, 2001 and December 31, 2002, respectively.
D. BROKERAGE. The Seller has not made any agreement or taken any other
action which might cause anyone to become entitled to a broker's fee or
commission from the as a result of the transactions contemplated hereunder.
REPRESENTATIONS AND WARRANTIES OF THE PURCHASER. Purchaser hereby warrants and
represents:
A. AUTHORITY RELATIVE TO THIS AGREEMENT AND ANCILLARY DOCUMENTS. Except as
otherwise stated herein, the Purchaser has full power and authority to execute
this Agreement, and carry out the transactions contemplated hereby and thereby
and no further action is necessary by the Purchaser to make this Agreement valid
and binding upon Purchaser and enforceable against it in accordance with the
terms hereof, or to carry out the actions contemplated hereby and thereby. The
execution, delivery and performance of this Agreement by the Purchaser will not
:
i. constitute a breach or a violation of any law, agreement, indenture, deed
of trust, mortgage, loan agreement or other instrument to which it is a party,
or by which it is bound;
ii. constitute a violation of any order, judgment or decree to which it is a
party or by which its assets or properties are bound or affected; or
iii. result in the creation of any lien, charge or encumbrance upon its
assets or properties except as stated herein.
B. BROKERAGE. The Purchaser has not made any agreement or taken any other
action which might cause anyone to become entitled to a broker's fee or
commission from the as a result of the transactions contemplated hereunder.
EXPENSES. Each of the parties hereto shall pay its own expense in connection
with this Agreement and the transactions contemplated hereby, including the fees
and expenses of its counsel and its certified public accountants and other
experts.
CLOSING DELIVERIES. At each of the Closing, the deliveries hereinafter
specified shall be made by the respective parties hereto, in order to consummate
the transactions contemplated hereby. Delivery of documents shall be no later
than June 1, 2003.
A. DELIVERIES BY SELLER. Seller shall deliver or caused to be delivered to
Purchaser:
i. Stock certificates, and any and all other instruments of conveyance and
transfer as required by Section 1(a) of this Agreement; and
ii. copies of all third party consents necessary to consummate the
transactions contemplated hereby.
B. DELIVERIES BY PURCHASER. Purchaser shall deliver or caused to be
delivered to Seller:
i. the Purchase Price as required by Section 2 of this Agreement; and
ii. copies of all third party consents necessary to consummate the
transactions contemplated hereby.
GENERAL.
A. SURVIVAL OF REPRESENTATIONS AND WARRANTIES. Each of the parties to this
Agreement covenants and agrees that its respective representations, warranties,
covenants and statements and agreements contained in this Agreement and the
exhibits hereto, and in any documents delivered in connection herewith, shall
survive the Closing Date indefinitely. Except agreements between the Purchaser
and certain individual members of Seller, and as set forth in this Agreement,
the exhibits hereto or in the documents and papers delivered in connection
herewith, there are no other agreements, representations, warranties or
covenants by or among the parties hereto with respect to the subject matter
hereof.
B. WAIVERS. No action taken pursuant to this Agreement, including any
investigation by or on behalf of any party shall be deemed to constitute a
waiver by the party taking such action or compliance with any representation,
warranty, covenant or agreement contained herein, therein and in any documents
delivered in connection herewith or therewith. The waiver by any party hereto
of a breach of any provision of this Agreement shall not operate or be construed
as a waiver of any subsequent breach.
VOTING. Purchaser and Seller mutually agree;
i. to vote all of their shares of the newly merged entity ("NewCo") in
favor of the other party's candidates for the NewCo board of directors for a
period of two (2) years from the Closing Date ("Vote Period").
ii. that during the Vote Period, under no circumstance will either
party vote any of their shares, in favor of the removal of any member of the
NewCo board of directors unless; either or both parties voluntarily waive this
right or any board member has committed an action deemed by a majority vote of
the board to be detrimental to NewCo.
D. NOTICES. All notices, requests, demands and other communications, which
are required or may be given under this Agreement shall be in writing and shall
be deemed to have been duly given if delivered or mailed, first class mail,
postage prepaid:
To Seller:
Network Installation, Inc.
Michael Cummings
18 Technology Dr., Suite 140A
Irvine, CA 92618
To Purchaser:
Flexxtech Corporation
Michael Novielli
100 Mill Plain Rd., 3rd Floor
Danbury, CT 06811
or to such other address as such party shall have specified by notice in writing
through Certified Mail to the other party.
E. ENTIRE AGREEMENT. This Agreement (including the exhibits hereto and all
documents and papers delivered pursuant hereto and any written amendments hereof
executed by the parties hereto) constitutes the entire agreement and supersedes
all prior agreements and understandings, oral and written, between the parties
hereto with respect to the subject matter hereof.
F. SECTIONS AND OTHER HEADINGS. The section and other headings contained
in this Agreement are for reference purposes only and shall not affect the
meaning or interpretation of this Agreement.
G. GOVERNING LAW. This Agreement, and all transactions contemplated
hereby, shall be governed by, construed and enforced in accordance with the laws
of the State of California. The parties herein waive trial by jury and agree to
submit to the personal jurisdiction and venue of a court of subject matter
jurisdiction located in Orange County, State of California. In the event that
litigation results from or arises out of this Agreement or the performance
thereof, the parties agree to reimburse the prevailing party's reasonable
attorney's fees, court costs, and all other expenses, whether or not taxable by
the court as costs, in addition to any other relief to which, the prevailing
party may be entitled.
H. CONTRACTUAL PROCEDURES. Unless specifically disallowed by law, should
litigation arise hereunder, service of process therefore, may be obtained
through certified mail, return receipt requested; the parties hereto waiving any
and all rights they may have to object to the method by which service was
perfected.
I. CONFIDENTIALITY AND NON-DISCLOSURE: Except to the extent required by
law, without the prior written consent, the undersigned will not make, and will
each direct its representatives not to make, directly or indirectly, any public
comment, statement, or communication with respect to, or to disclose or permit
the disclosure of the existence of this transaction prior to closing.
J. AMENDMENT AND WAIVER. The parties may by mutual agreement amend this
Agreement in any respect, and any party, as to such party, may (a) extend the
time for the performance of any of the obligations of any other party, and (b)
waive (i) any inaccuracies in representations by any other party, (ii)
compliance by any other party with any of the agreements contained herein and
performance of any obligations by such other party, and (iii) the fulfillment of
any condition that is precedent to the performance by such party of any of its
obligations under this Agreement. To be effective, any such amendment or waiver
must be in writing and be signed by the party against whom enforcement of the
same is sought.
K. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of whom shall for all purposes are deemed to be an original
and all of which shall constitute one instrument.
IN WITNESS WHEREOF, this Agreement has been executed by each of the individual
parties hereto, all on the date first above written.
PURCHASER
Flexxtech Corporation
_____________________________________
Michael A. Novielli, Chairman
SELLER
Michael Cummings
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EXHIBIT 99.1 PRESS RELEASE
FLEXXTECH CORPORATION CLOSES MERGER WITH NETWORK INSTALLATION CORPORATION
DANBURY, CT -- (BUSINESS WIRE) - May 23, 2003 - Flexxtech Corporation
(OTC Bulletin Board: FLXE) announced today that it has closed on its merger
with Irvine, CA-based Network Installation Corp.
"With many of the major issues involving the corporate restructuring behind
us, we are both anxious and thrilled to embark on a new path and believe that
this merger with Network Installation will bring tremendous value to our
shareholders and investors", stated Flexxtech Chairman Michael Novielli.
"I am excited about the new direction and promising future ahead for
Flexxtech", added incoming Flexxtech CEO Michael Cummings. "Our two-pronged
approach will be to continue focusing on Network's core competency of project
management in networking infrastructure design, installation, and support. We
also are currently leveraging our industry proficiency in our pursuit of an
enormous opportunity within the burgeoning Wi-Fi arena."
In conjunction with the merger, Mr. Cummings has also been named to the
Board of Directors. Mr. Novielli has resigned as Flexxtech CEO but will remain
in his capacity as Chairman.
About Network Installation Corporation
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Network Installation Corp., is one of Southern California's leading
independent designers and installers of data, voice, and video networks. Some of
Network's clients include; IBM, Cisco Systems, The Travelers, UPS, University of
Southern California, UCLA, The Counties of Los Angeles and Orange, among other
Fortune 1000 companies and highly regarded institutions. Additional information
on Network Installation can be viewed at www.networkinstallationcorp.com.
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Flexxtech's public filings can be viewed at www.sec.gov.
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This release contains forward-looking statements within the meaning of
Section 27a of the Securities Act of 1933, as amended and section 21e of the
Securities Exchange Act of 1934, as amended. Those statements include the
intent, belief or current expectations of the company and its management team.
Prospective investors are cautioned that any such forward-looking statements are
not guarantees of future performance and involve risks and uncertainties, and
that actual results may differ materially from those projected in the
forward-looking statements as a result of various factors. Accomplishing the
strategy described herein is significantly dependent upon numerous factors, many
of which are not in management's control. Some of these factors include the
ability of the company to raise sufficient capital, attract qualified
management, attract new customers, and effectively compete against similar
companies.
Contact: Michael Novielli, Chairman
(203) 791-3838