-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, WRVC+Hg68DmB9aJAQ9iMgnfhkc+RT/eCOJWAvObPXRz5euitw+H36CyJUUYtq/6E ASjNBlDfJXuXXqgKA1+oCg== 0000944209-98-001818.txt : 19981105 0000944209-98-001818.hdr.sgml : 19981105 ACCESSION NUMBER: 0000944209-98-001818 CONFORMED SUBMISSION TYPE: 8-K/A PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19980723 ITEM INFORMATION: ITEM INFORMATION: FILED AS OF DATE: 19981104 FILER: COMPANY DATA: COMPANY CONFORMED NAME: UNITED LEISURE CORP CENTRAL INDEX KEY: 0000059684 STANDARD INDUSTRIAL CLASSIFICATION: LESSORS OF REAL PROPERTY, NEC [6519] IRS NUMBER: 132652243 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K/A SEC ACT: SEC FILE NUMBER: 000-06106 FILM NUMBER: 98737795 BUSINESS ADDRESS: STREET 1: 18081 MAGNOLIA AVENUE CITY: FOUNTAIN VALLEY STATE: CA ZIP: 92708 BUSINESS PHONE: 7143788761 MAIL ADDRESS: STREET 1: 18081 MAGNOLIA AVENUE CITY: FOUTAIN VALLEY STATE: CA ZIP: 92708 FORMER COMPANY: FORMER CONFORMED NAME: LION COUNTRY SAFARI INC DATE OF NAME CHANGE: 19870330 FORMER COMPANY: FORMER CONFORMED NAME: NATIONAL LEISURE INC DATE OF NAME CHANGE: 19720407 8-K/A 1 AMENDMENT NO. 1 TO FORM 8-K DATED JULY 23, 1998 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 8-K (AMENDMENT NO.1) CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 DATE OF REPORT: July 23, 1998 UNITED LEISURE CORPORATION (Exact Name of Registrant as Specified in its Charter) DELAWARE 0-6106 13-2652243 (State or Other (Commission (I.R.S. Employer Jurisdiction of File Number) I.D. No.) Incorporation) 18081 MAGNOLIA AVENUE, FOUNTAIN VALLEY, CA 92708 (Address of Principal Executive Offices) (Zip Code) 714/378-8761 (Registrant's Telephone Number, Including Area Code) N/A (Former name or former address, if changed from last report) ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS. On July 23, 1998, United Leisure Corporation (the "Company") and its wholly-owned subsidiary, United Internet Technologies, Inc. (formerly known as United Leisure Interactive, Inc.) ("UIT") entered into an Asset Purchase Agreement dated as of June 30, 1998 (the "Purchase Agreement"), with Genisys Reservations Systems, Inc., a New Jersey corporation ("Genisys"), and Netcruise Interactive, Inc. ("Netcruise"), a wholly-owned subsidiary of Genisys, pursuant to which UIT transferred to Netcruise all of UIT's right, title and interest in and to (i) an exclusive, world-wide and perpetual license from UIT with respect to travel-related applications of certain interactive technology, (ii) certain related intellectual property, and (iii) certain tangible assets to be used in connection with the exploitation of the licensed technology. In consideration for the receipt thereof, Genisys issued to UIT (i) 2,000,000 shares of its Common Stock, (ii) a warrant to purchase up to 800,000 shares of Genisys Common Stock at $2.50 per share if the total pretax profits of Netcruise ("Total Pretax Profits") for the years 1999, 2000, and 2001 equal or exceed $5,000,000 and (iii) a warrant to purchase up to 800,000 shares of Common Stock at $6.00 per share if Total Pretax Profits for the years 1999, 2000, and 2001 equal or exceed $10,000,000. For a period of three years, Harry Shuster will serve as Chairman, and Brian Shuster will serve as President, of Netcruise. In addition, both Harry Shuster and Brian Shuster will serve on the Board of Directors of Genisys for the same period. Harry Shuster is Chairman of the Board, President, Chief Executive officer and a director of the Company and Brian Shuster is Executive Vice President, Secretary and a director of the Company. Brian Shuster is the son of Harry Shuster. Pursuant to the Purchase Agreement, Brian Shuster was issued warrants to purchase Genisys Common Stock on the same terms as the warrants issued to UIT, except that each of the two warrants issued to Brian Shuster represents the right to purchase up to 200,000 shares of Genisys Common Stock. Netcruise also assumed UIT's lease at 1990 Westwood Boulevard, Penthouse, Los Angeles, California. The Company agreed not to enter into any facet of the travel industry in competition with Genisys or Netcruise. Subsequent to the date of the transaction described above, Genisys informed the Company and UIT of the following. Genisys was notified by The Nasdaq Stock Market, Inc. ("Nasdaq") that the issuance of the 2,000,000 shares of Genisys Common Stock and the Warrants to UIT caused Genisys to be inadvertently in violation of a certain Nasdaq Marketplace Rule (the "Nasdaq Rule"), because the issuance of the 2,000,000 shares of Genisys Common Stock and the 1 Warrants amounted to more than 20% of the issued and outstanding shares of Genisys and the issuance thereof was not approved by Genisys' stockholders as required by the Nasdaq Rule. Genisys has been informed that Nasdaq intends to delist Genisys' Common Stock as a result of its noncompliance with the Nasdaq Rule, unless Genisys takes curative action acceptable to Nasdaq. Pending the full implementation of the proposed curative action described below, Genisys has appealed Nasdaq's determination. A hearing on the proposed delisting is pending. As a result of the Nasdaq notification, UIT, Genisys and certain of Genisys' principal stockholders have entered into an agreement dated October 28, 1998 (the "Agreement") for the purpose of restructuring their transaction, and Genisys is in the process of calling a meeting of its stockholders to seek the stockholder approval required by the Nasdaq Rule. Under the terms of the Agreement, UIT is returning to Genisys (i) 1,100,000 shares of Genisys Common Stock (retaining 900,000 shares of Genisys Common Stock (the "Retained Shares")) and (ii) the Warrants. Genisys will promptly issue to UIT 1,100,000 shares of Genisys Convertible Series B Preferred Stock, par value $.0001 per share (the "Genisys Preferred Shares"), which, among other things, are automatically convertible into 1,100,000 shares of Genisys Common Stock upon Genisys' obtaining stockholder approval as required by the Nasdaq Rule. In addition, upon obtaining the requisite stockholder approval, Genisys will reissue the Warrants to UIT. Among other things, the Genisys Preferred Shares carry a mandatory dividend of $275,000, payable on September 30, 1999, and mandatory quarterly dividends of $68,750, commencing with the quarter ending December 31, 1999. No dividend is payable if the Genisys stockholders approve the issuance of the 1,100,000 shares of Genisys Common Stock and the Warrants to UIT, and the Genisys Preferred Shares have been converted into 1,100,000 shares of Genisys Common Stock, prior to June 30, 1999. The Genisys Preferred Shares are non-voting, unless voting is required by New Jersey law. The Genisys Preferred Shares also carry a mandatory liquidation preference of $2,750,000 plus all accrued and unpaid dividends. UIT has agreed not vote the Retained Shares and may not vote the Genisys Preferred Shares at the Genisys stockholders' meeting. Certain principal stockholders of Genisys have agreed to vote their shares of Genisys Common Stock in favor of the issuance of the 1,100,000 shares of Genisys Common Stock and the Warrants. If, for any reason, the 1,100,000 shares of Genisys Common Stock and the Warrants are not issued to UIT on or before June 30, 1999, then, in addition to any and all rights and remedies available to UIT, UIT at its option, may appoint up to four members of the Board of Directors of Genisys. 2 ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS (c) Exhibits 2.1 Asset Purchase Agreement, dated as of June 30, 1998, by and among United Leisure Corporation, a Delaware corporation; United Leisure Interactive, Inc., a Delaware corporation; Genisys Reservations Systems, Inc., a New Jersey corporation; and Netcruise Interactive, Inc., a New Jersey corporation (previously filed with the Company's Current Report on Form 8-K dated July 23, 1998). 2.2. Agreement dated October 27, 1998, by and among United Internet Technologies, Inc., Genisys Reservation Systems, Inc., Warren D. Bagatelle, Loeb Holding Corporation, Loeb Partners Corp., HSB Capital, David W. Sass, Mark A. Kenny, John H. Wasko, Joan E. Wasko, Lawrence E. Burk and S. Charles Tabak. 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 duly authorized. UNITED LEISURE CORPORATION Dated: November 4, 1998 By /s/ Harry Shuster -------------------------- Harry Shuster, Chief Executive Officer 3 EX-2.2 2 AGREEMENT DATED OCTOBER 27, 1998 AGREEMENT EXHIBIT 2.2 --------- Final 10/27/98 -------------- 1. Initial Transaction. Reference is made to that certain Asset Purchase ------------------- Agreement dated as of June 30, 1998, pursuant to which United Internet Technologies, Inc. (formerly known as United Leisure Interactive, Inc. and hereafter referred to as "United") sold certain assets to Netcruise Interactive, Inc. ("Netcruise"), in consideration of, among other things, (i) 2,000,000 shares (the "Shares") of the Common shares (the "Common Stock") of Genisys Reservation Systems, Inc. ("Genisys"), and (ii) two warrants (the "Warrants") each entitling the holder to purchase 800,000 shares of Common Stock. 2. Curative Action and Reason Therefor. Genisys has advised United that ----------------------------------- (i) the foregoing matter has caused Genisys to be in inadvertent violation of Nasdaq Marketplace Rule 4310 (c)(25)(H) (the "Rule"), because the issuance of the Shares and the Warrants was not approved by Genisys' shareholders as required by the Rule; and (ii) Nasdaq has informed Genisys that it will delist the Common Stock absent the undersigned parties taking curative action (the "Curative Action") acceptable to Nasdaq. Accordingly, Genisys and United, by this Agreement, have, subject to the execution of this Agreement by all individuals and entities reflected on the signature page hereto, agreed to take the following Curative Action: (a) Subject to compliance by Genisys with the provisions of Section 2 (b) below, United will return (the "Return") to Genisys (i) 1,100,000 of the Shares for cancellation (the remaining Shares are hereinafter referred to as the "Retained Shares"), and (ii) the Warrants. (b) Simultaneously with the Return, Genisys will duly and validly authorize, issue and deliver (the "Delivery") to United 1,100,000 Preferred shares of Genisys having the following rights, preferences, privileges and restrictions (the "United Preferred Shares"): (i) a par value of $.0001 per United Preferred Share; (ii) no voting rights except (A) as required by law, and (B) that the rights, preferences, privileges and restrictions of the United Preferred Shares shall not be amended, modified or affected without the prior written consent of the holders thereof; (iii) the following dividend rights (with all dividends to accrue pro rata on a daily basis from the first day of the period with respect to which they are payable): (A) one mandatory dividend at the total annual rate of $275,000 (accruing from October 1, 1998), payable on September 30, 1999, (B) mandatory dividends at the total quarterly rate of $68,750 (accruing from the first day of the relevant calendar quarter), payable on the last day of each calendar quarter commencing with the calendar quarter ending December 31, 1999, and (C) additional mandatory dividends computed at the rate of 10% per annum on the amount of any dividends not paid when due (accruing from and after such relevant due dates), payable as and when (and to the full extent of) funds become legally available for such purpose (all of the foregoing being referred to as the "Dividend Payment Rights"); (iv) a mandatory liquidation preference equal to the sum of $2,750,000 plus all accrued and unpaid dividends in respect of the Dividend Payment Rights, but not to exceed the maximum permitted by New Jersey Law, payable upon any liquidation or dissolution of Genisys (the "Liquidation Preference"); (v) first seniority rights for the United Preferred Shares over all other classes and series of Genisys' capital stock in respect of dividends or other distributions on or with respect to any shares of Genisys' capital stock, including without limitation amounts payable upon any dissolution or liquidation of Genisys (and, in furtherance and not by way of limitation of the foregoing, a prohibition on Genisys paying any dividend or making any other distribution on or with respect to or redeeming or purchasing any shares of its capital stock, other than the United Preferred Shares, while any of the United Preferred Shares are outstanding); (vi) automatic, mandatory conversion of the United Preferred Shares into an equal number of shares of Common Stock (with full anti-dilution protection), immediately prior to the consummation of any merger, consolidation, reorganization or sale of all or substantially all of the assets of or any similar transaction involving Genisys or any of its subsidiaries except that Genisys can sell its travel related business, provided that such business represents less than 30% of the assets of Genisys on a consolidated basis; and (vii) automatic, mandatory conversion of the United Preferred Shares into an equal number of shares of Common Stock (with full anti-dilution protection) upon Genisys obtaining the requisite approval of its shareholders (other than the holders of the United Preferred Shares and the holders of the Retained Shares) to the Transaction as contemplated by Section 4 below, hereinafter the "Requisite Approval"), with all accrued and unpaid dividends in respect of the Dividend Payment Rights to be immediately due and payable by Genisys to the holders of the United Preferred Shares whether or not such dividends are otherwise yet payable (unless the Requisite Approval has been obtained and the United Preferred Shares have been converted, as aforesaid, on or before June 30, 1999, in which event no such dividends shall be due or payable). For purposes of this Agreement, the term "full anti-dilution protection" shall be applied in the same manner as the anti-dilution provisions are to be applied in the Warrants. The Delivery shall, in form and substance, be satisfactory to United. 3. Return of Warrants. If the Requisite Approval is obtained, Genisys ------------------ will immediately redeliver the Warrants to United. 4. Shareholders Meeting. Genisys will, in accordance with all applicable -------------------- legal and Nasdaq requirements, call a meeting (the "Shareholders Meeting") of all of the holders of its voting capital stock to consider and approve the issuance of 1,100,000 Shares and the Warrants, as well as any other matters that may properly come before the Shareholders Meeting. 2 At the Shareholders Meeting, each of the undersigned shareholders of Genisys agrees to vote all of its, his or her shares of Genisys' capital stock (whether owned of record and/or beneficially), and Genisys agrees to use its best efforts to cause all of Genisys' other shareholders to vote all of their shares of Genisys capital stock, in favor of the issuance of the 1,100,000 Shares and the Warrants. If, for any reason whatsoever, the aforesaid 1,100,000 Shares and the Warrants are not issued to Netcruise on or before June 30, 1999, then, in addition to any and all other rights and remedies available to United, at United's option, up to four (4) members of the Board of Directors of Genisys ("Board"), which members shall be selected by United, shall forthwith resign and, concurrently therewith, all of the remaining members of the Board shall elect those persons chosen by United to replace them. By their signatures below, those shareholders of Genisys who are also members of the Board agree to take such action as to carry out the terms of this provision. 5. Attorneys Fees and Other Expenses. Genisys will bear all of its own --------------------------------- expenses (including, without limitation, attorneys' fees and expenses) in connection with this Agreement, the subject matter hereof and the consummation of the transactions contemplated hereby. Genisys shall also be responsible, and shall promptly reimburse United upon demand, for all expenses (including, without limitation, attorneys' fees and expenses) incurred by United and its affiliates in connection with this Agreement, the subject matter hereof and the consummation of the transactions contemplated hereby (including, without limitation, such thereof as may be incurred by such persons in connection with complying with any SEC reporting requirements attendant to the foregoing); and, in furtherance and not by way of limitation of the foregoing, Genisys shall, simultaneously with the execution hereof by United, deliver to United the sum of $5,000 as an advance to be used against such expenses (any unused portion thereof to be refunded by United to Genisys following the completion of the Shareholders Meeting). 3 IN WITNESS WHEREOF, for good and valuable consideration the receipt and sufficiency of which is hereby acknowledged, each of the undersigned has executed and delivered this Agreement as of the 28th day of October, 1998. ---- UNITED INTERNET TECHNOLOGIES, GENISYS RESERVATION SYSTEMS, INC. INC. By /s/ Harry Shuster By /s/ Lawrence E. Burk ----------------- -------------------- PRINCIPAL GENISYS SHAREHOLDERS: /s/ Warren D. Bagatelle /s/ Mark A. Kenny - ----------------------- ----------------- WARREN D. BAGATELLE MARK A. KENNY /s/ Warren D. Bagatelle,Mg.Dir /s/ John H. Wasko - ------------------------------ ----------------- LOEB HOLDING CORPORATION JOHN H. WASKO /s/ Warren D. Bagatelle,Mg.Dir /s/ Joan W. Wasko - ------------------------------ ----------------- LOEB PARTNERS CORP. JOAN E. WASKO /s/ Warren D.Bagatelle,Partner /s/ Lawrence E. Burk - ----------------------------- -------------------- HSB CAPITAL LAWRENCE E. BURK /s/ David W. Sass /s/ S. Charles Tabak - ----------------- -------------------- DAVID W. SASS S. CHARLES TABAK 4 -----END PRIVACY-ENHANCED MESSAGE-----