-----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, KT0cd13ZElZC7TeNYKrjn/Jh8gMNTg37BoEindsYy2x3SIZ4YFVlkoGYqZ/36R/4 mVh5K0NY1yzYZ/c/1WQ2Aw== 0001104659-10-003940.txt : 20100129 0001104659-10-003940.hdr.sgml : 20100129 20100129155100 ACCESSION NUMBER: 0001104659-10-003940 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 2 FILED AS OF DATE: 20100129 DATE AS OF CHANGE: 20100129 GROUP MEMBERS: EDWIN L. KNETZGER, III SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: Bonds.com Group, Inc. CENTRAL INDEX KEY: 0001179090 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-MANAGEMENT CONSULTING SERVICES [8742] IRS NUMBER: 383649127 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-80545 FILM NUMBER: 10559158 BUSINESS ADDRESS: STREET 1: 1515 S. FEDERAL HIGHWAY STREET 2: SUITE 212 CITY: BOCA RATON, STATE: FL ZIP: 33432 BUSINESS PHONE: 561-953-5343 MAIL ADDRESS: STREET 1: 1515 S. FEDERAL HIGHWAY STREET 2: SUITE 212 CITY: BOCA RATON, STATE: FL ZIP: 33432 FORMER COMPANY: FORMER CONFORMED NAME: IPORUSSIA INC DATE OF NAME CHANGE: 20020801 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: Fund Holdings, LLC CENTRAL INDEX KEY: 0001472679 IRS NUMBER: 000000000 STATE OF INCORPORATION: FL FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: 5447 NW 42ND AVENUE CITY: BOCA RATON STATE: FL ZIP: 33496 BUSINESS PHONE: 917-929-9999 MAIL ADDRESS: STREET 1: 5447 NW 42ND AVENUE CITY: BOCA RATON STATE: FL ZIP: 33496 SC 13D/A 1 a10-2485_1sc13da.htm SC 13D/A

	UNITED STATES
	SECURITIES AND EXCHANGE COMMISSION
	Washington, DC 20549

	SCHEDULE 13D/A

Under the Securities Exchange Act of 1934
(Amendment No. 2)

Bonds.com Group, Inc.

(Name of Issuer)

Common Stock

(Title of Class of Securities)

098003106

(CUSIP Number)

Edwin L. Knetzger, III

Manager

Fund Holdings LLC

c/o DivcoWest

575 Market Street, 35th Floor

San Francisco, CA 94105

(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)

Copy to:

Mark S. Lahive, Esq.

Gibson, Dunn & Crutcher LLP

2029 Century Park East

Los Angeles, CA 90067

(310) 552-8580

December 31, 2009

(Date of Event Which Requires Filing of this Statement)

If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the following box: o

CUSIP No.: 098003106

	1.	Name of Reporting Persons: Edwin L. Knetzger, III

	2.	Check the Appropriate Box if a Member of Group
		(a)			o
		(b)			o

	3.	SEC Use Only

	4.	Source of Funds PF,OO

	5.	Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e) o

	6.	Citizenship or Place of Organization: United States Citizen

Number of Shares Beneficially Owned by Each Reporting Person With:			7.	Sole Voting Power: 6,033,884

			8.	Shared Voting Power: 77,633,618 (1)

			9.	Sole Dispositive Power: 6,033,884

			10.	Shared Dispositive Power: 77,633,618 (2)

	11.	Aggregate Amount Beneficially Owned by Each Reporting Person: 83,667,502

	12.	Check if the Aggregate Amount in Row (11) Excludes Certain Shares o

	13.	Percent of Class Represented by Amount in Row (11): 76.6%

	14.	Type of Reporting Person: IN

(1)		Of the 83,667,502 shares of Common Stock reported in this Schedule 13D (the “Shares”): 9,841,230 shares of Common Stock are owned by Fund Holdings LLC (“Fund Holdings”), of which the Reporting Person is the sole manager; 10,000,000 shares of Common Stock are owned by Otis Angel LLC (“Otis”), of which John J. Barry IV (“JBIV”) is the sole managing member; 5,000,000 shares of Common Stock are owned by Siesta Capital LLC (“Siesta”), of which JBIV is the sole managing member; 2,000,000 shares of Common Stock are owned by Bond Partners LLC (“Bond Partners”), of which JBIV is the sole managing member; 3,500,000 shares of Common Stock are owned by the John J. Barry IV Revocable Trust (“JB Trust”), of which JBIV is the trustee; 15,724,388 shares are owned jointly by John J. Barry III (“JBIII”) and his spouse, Holly A.W. Barry (“HAB”), as tenants by the entirety; 4,000,000 shares are owned by Duncan Family, LLC (“Duncan LLC”), of which JBIII and HAB are each 50% owners of the managing membership interest; and 1,000,000 shares are owned by Duncan Family Revocable Trust (“Duncan Trust”), of which JBIII and HAB are co-trustees. Otis, Siesta, Bond Partners, JB Trust, JBIV, JBIII, HAB, Duncan LLC and Duncan Trust are referred to herein, collectively, as the “Majority Stockholders.” The 83,667,502 shares of Common Stock reported in this Schedule 13D also include (i) purchase rights issued to Fund Holdings LLC to purchase 26,568,000 shares of Common Stock, of which 18,378,995 shares of Common Stock are subject to certain restrictions that prohibit the exercise of Fund Holding’s rights to purchase such shares until such time that the Issuer files an amendment to its Certificate of Incorporation to increase the number of authorized shares of Common Stock to 300,000,000 (the “Charter Amendment”), (ii) purchase rights issued to the Reporting Person to purchase 5,533,884 shares of Common Stock, all of which are subject to certain restrictions that prohibit the exercise of Fund Holding’s rights to purchase such shares until the Issuer files the Charter Amendment and (iii) 500,000 shares of Common Stock that the Reporting Person has the right to acquire within 60 days upon the exercise of a director stock option. The Reporting Person disclaims beneficial ownership of the shares of common stock owned by Fund Holdings except to the extent of his pecuniary interest therein, as well as any shares beneficially owned by any of the Majority Stockholders, and this Schedule 13D shall not be deemed an admission of beneficial ownership thereof.

(2)		Represents: 9,841,230 shares of Common Stock owned by Fund Holdings LLC, of which the Reporting Person is the sole manager; 41,224,388 shares of Common Stock owned by the Majority Stockholders; purchase rights issued to Fund Holdings LLC to purchase 26,568,000 shares of Common Stock, of which 18,378,995 shares of Common Stock are subject to certain restrictions that prohibit the exercise of Fund Holding’s rights to purchase such shares until such time that the Issuer files the Charter Amendment; purchase rights issued to the Reporting Person to purchase 5,533,884 shares of Common Stock, all of which are subject to certain restrictions that prohibit the exercise of Fund Holding’s rights to purchase such shares until the Issuer files the Charter Amendment; and 500,000 shares of Common Stock that the Reporting Person has the right to acquire within 60 days upon the exercise of a director stock option. The Reporting Person disclaims beneficial ownership of the shares of common stock owned by Fund Holdings except to the extent of his pecuniary interest therein, as well as any shares beneficially owned by any of the Majority Stockholders, and this Schedule 13D shall not be deemed an admission of beneficial ownership thereof.

CUSIP No.: 098003106

	1.	Name of Reporting Persons: Fund Holdings LLC

	2.	Check the Appropriate Box if a Member of Group
		(a)			o
		(b)			o

	3.	SEC Use Only

	4.	Source of Funds PF,OO

	5.	Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e) o

	6.	Citizenship or Place of Organization: Florida

Number of Shares Beneficially Owned by Each Reporting Person With:			7.	Sole Voting Power: 0

			8.	Shared Voting Power: 77,633,618 (3)

			9.	Sole Dispositive Power: 0

			10.	Shared Dispositive Power: 77,633,618 (4)

	11.	Aggregate Amount Beneficially Owned by Each Reporting Person: 77,633,618

	12.	Check if the Aggregate Amount in Row (11) Excludes Certain Shares o

	13.	Percent of Class Represented by Amount in Row (11): 75.3%

	14.	Type of Reporting Person: OO

(3)		Of the 77,633,618 shares of Common Stock reported in this Schedule 13D: 9,842,230 shares of Common Stock are owned by the Reporting Person; and 41,224,388 shares of Common Stock owned by the Majority Stockholders. The 77,633,618 shares of Common Stock reported in this Schedule 13D also include purchase rights issued to the Reporting Person to purchase 26,568,000 shares of Common Stock, of which 18,378,995 shares of Common Stock are subject to certain restrictions that prohibit the exercise of the Reporting Person’s rights to purchase such shares until such time that the Issuer files the Charter Amendment. The Reporting Person disclaims beneficial ownership of the shares of common stock owned by any of Mr. Knetzger or the Majority Stockholders, and this Schedule 13D shall not be deemed an admission of beneficial ownership thereof.

(4)		Represents: 9,841,230 shares of Common Stock owned by the Reporting Person; 41,224,388 shares of Common Stock owned by the Majority Stockholders; and purchase rights issued to the Reporting Person to purchase 26,568,000 shares of Common Stock, of which 18,378,995 shares of Common Stock are subject to certain restrictions that prohibit the exercise of the Reporting Person’s rights to purchase such shares until such time that the Issuer files the Charter Amendment. The Reporting Person disclaims beneficial ownership of the shares of common stock owned by any of Mr. Knetzger or the Majority Stockholders, and this Schedule 13D shall not be deemed an admission of beneficial ownership thereof.

The information set forth in response to each separate Item shall be deemed to be a response to all Items where such information is relevant. This Amended and Restated Schedule 13D of Edwin L. Knetzger, III (“Mr. Knetzger”) and Fund Holdings LLC, a Florida limited liability company (“Fund Holdings” and, together with Mr. Knetzger, the “Reporting Persons”), filed on January 27, 2010, amends and restates the Schedule 13D filed September 21, 2009 and amended on November 12, 2009 (collectively, the “Statement”) in its entirety as follows:

Item 1.	Security and Issuer.
This statement on Schedule 13D relates to the common stock, par value $0.0001 per share (the “Common Stock”) of Bonds.com Group, Inc., a Delaware corporation (the “Issuer” or the “Company”), whose principal executive offices are located at 1515 South Federal Highway, Suite 212, Boca Raton, Florida 33432.

Item 2.	Identity and Background.
(a) This Statement is being filed jointly on behalf of Mr. Knetzger and Fund Holdings. Nothing contained herein shall be deemed an admission by any Reporting Person that such a Reporting Person is a member of a “group” (within the meaning of Rule 13d-5(b) under the Securities and Exchange Act of 1934, as amended) with any of the Majority Stockholders (as defined herein) or that any such group exists. Mr. Knetzger is the sole manager of Fund Holdings. (b) The business address of each of the Reporting Persons is: c/o DivcoWest 575 Market Street, 35th Floor San Francisco, California 94105 (c) Mr. Knetzger is the Co-Chairman of the Board of Directors of the Issuer. Fund Holdings is organized in Florida. Fund Holdings was organized to make investments, including investments in the Issuer. (d) None of the Reporting Persons have, during the last five years, been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors). (e) None of the Reporting Persons have, during the last five years, been a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such proceeding was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, Federal or state securities laws or finding any violation with respect to such laws. (f) Mr. Knetzger is a citizen of the United States.

Item 3.

Source and Amount of Funds or Other Consideration.

Fund Holdings and the Issuer entered into a unit purchase agreement, dated as of August 28, 2009 (as amended, the “Fund Holdings Purchase Agreement”), pursuant to which Fund Holdings was entitled to purchase, in up to three closings, a total of 5,000 units at a price of $1,000 per unit. Each unit (a “Unit”) consists of 2,667 shares of Common Stock and (ii) rights to purchase an additional 9,597 shares of Common Stock at a per share price of $0.375 (“Ordinary Rights”). Under the Purchase Agreement, Fund Holdings was also entitled to certain other rights to acquire shares of Common Stock, including (a) rights to immediately acquire an additional 1,000,000 shares of Common Stock at a per share price of $0.375 (“Special Rights”) and (b) conditional rights to acquire an additional 26,893,580 shares of Common Stock at a per share price of $0.375, where the ability to exercise such rights is conditioned upon the exercise of one or more existing purchase rights held by third parties (“Conditional Rights”).

The foregoing description of the Fund Holdings Purchase Agreement is a summary only, and is qualified in its entirety by reference to the Fund Holdings Purchase Agreement, a copy of which is included as Exhibit 1 to this Statement.

In connection with the Initial Closing (defined below), Fund Holdings assigned (i) 2,397 of the Ordinary Rights with respect to each Unit, (ii) all of the Special Rights and (iii) all of the Conditional Rights to Mr. Knetzger, Black-II Trust, a trust associated with Mark G. Hollo (“Mr. Hollo”), and Victor Angermueller (“Mr. Angermueller”).

On September 2, 2009 (the “Initial Closing”), Fund Holdings purchased 1,000 Units and received 2,667,000 shares of Common Stock and 7,200,000 Ordinary Rights. Mr. Knetzger was issued 333,334 Special Rights and 799,000 Ordinary Rights in connection with the Initial Closing.

On November 6, 2009 (the “Second Closing”), Fund Holdings purchased another 1,000 Units and received 2,667,000 shares of Common Stock and 7,200,000 Ordinary Rights. Mr. Knetzger was issued 799,000 Ordinary Rights in connection with the Second Closing.

On December 23, 2009, in anticipation of the third closing contemplated by the Fund Holdings Purchase Agreement, the Issuer and Fund Holdings entered into an amendment letter (the “Amendment Letter”) to the Fund Holdings Purchase Agreement, which set forth a number of conditions to the consummation of the third closing under the Fund Holdings Purchase Agreement. The conditions for the third closing set forth in the Amendment Letter included (i) an obligation that Fund Holdings and the Majority Stockholders enter into a Voting Agreement which is described in more detail below and (ii) an obligation that the Issuer execute an amendment to its Certificate of Incorporation increasing its number of authorized shares of Common Stock from 150,000,000 shares to 300,000,000 shares (the “Charter Amendment”). In addition, the Amendment Letter provided that the Issuer could sell to other investors certain of the Units allocated to Fund Holdings; provided that such investors would be issued 2,677 shares of Common Stock and 7,200 Ordinary Rights per Unit and Fund Holdings would be entitled to purchase 2,397 Ordinary Rights per unit at a price of $1.00 per Unit.

The foregoing description of the Amendment Letter is a summary only, and is qualified in its entirety by reference to the Amendment Letter, a copy of which is included as Exhibit 2 to this Statement.

As previously disclosed by the Issuer and as contemplated by the Amendment Letter, on December 31, 2009, the Issuer entered into a Unit Purchase Agreement (the “LVPIII Purchase Agreement”) with Laidlaw Venture Partners III, LLC (“Laidlaw Venture Partners III”). Pursuant to the LVPIII Purchase Agreement, Laidlaw Venture Partners III invested a total of $2,000,000 in the Issuer in

exchange for a combination of shares of Common Stock and rights to purchase additional shares of Common Stock.

On December 31, 2009 (the “Third Closing”), Fund Holdings purchased 1,690 Units and received 4,507,230 shares of Common Stock and 12,168,000 Ordinary Rights. In addition, at the Third Closing, Fund Holdings purchased 3,140,070 Ordinary Rights in connection with 1,310 Units purchased by Laidlaw Venture Partners III pursuant to the LVPIII Purchase Agreement and assigned those Ordinary Rights to other persons, including Mr. Knetzger. As a result, in connection with the Third Closing, Mr. Knetzger was issued 2,135,000 Ordinary Rights and 8,964,526 Conditional Rights.

As contemplated by the Amendment Letter, in connection with the Third Closing, Fund Holdings entered into a Voting Agreement, dated as of December 31, 2009 (the “Voting Agreement”), among Otis Angel LLC, Siesta Capital LLC, Bond Partners LLC and the John J. Barry IV Revocable Trust (collectively, the JBIV Stockholders”), John Barry III and Holly A.W. Barry, as tenants by the entirety, Duncan Family, LLC and Duncan Family Revocable Trust (collectively, the “JBIII Stockholders” and together with the JBIV Stockholders, the “Majority Stockholders”; and, together with Fund Holdings, the “Voting Agreement Parties”). The Voting Agreement includes the following obligations:

· The Majority Stockholders are obligated to vote their voting shares: (a) for the approval of the Charter Amendment; (b) for the election of Mr. Knetzger and Michael Sanderson as directors of the Issuer; (c) for election of nominees proposed for election as independent directors by the Board’s nomination committee; (d) against the removal of Mr. Knetzger and Mr. Sanderson other than for malfeasance; and (e) against actions which would reasonably be expected to result in a breach of the Fund Holdings Purchase Agreement;

· Fund Holdings is obligated to vote its voting shares (a) for the election of John Barry III and John J. Barry IV as directors of the Issuer, and (b) against the removal of John Barry III and John J. Barry IV other than for malfeasance;

· Each Majority Stockholder and Fund Holdings gave the other party a proxy to accomplish the foregoing voting obligations; and

· The Majority Stockholders are prohibited from transferring any of their voting shares except for certain permitted transfers and in connection with any merger, consolidation, tender offer or other similar transaction involving an acquisition of all or substantially all of the capital stock of the Issuer. The permitted transfers include (a) any transfer after which the Majority Stockholders and Fund Holdings still own a majority of the then-outstanding shares of the Company’s voting stock, (b) any transfer during any period in which, for the immediately preceding two month period, the Issuer’s Common Stock traded at an average daily price per share of at least $1.50 and the average daily trading volume was at least 50,000 shares, (c) transfers in connection with strategic transactions in which the Issuer receives assets or other consideration the value of which, as determined in good faith by a majority of the Issuer’s directors (other than John Barry III and John Barry IV), equals or exceeds the fair market value of the voting shares transferred, and (d) transfers to affiliates or family members or by gift, will or intestacy, including, without limitation, transfers by gift, will or intestacy to family members of such Majority Stockholder or to a settlement or trust established under the laws of any country; provided, that in the event of any Permitted Transfer described in clause (c) or (d), the transferee shall enter into a similar voting agreement.

The Voting Agreement will terminate automatically on the earlier of (a) at any time by mutual agreement between Fund Holdings and the Majority Stockholders, (b) December 31, 2012, (c) the date on which Fund Holdings no longer owns at least 10% of the shares held by it on the date of the Voting Agreement, and (d) the date on which the Majority Stockholders no longer collectively own at least 10% of the shares held by them on the date of the Voting Agreement.

The foregoing description of the Voting Agreement is a summary only, and is qualified in its entirety by reference to the Voting Agreement, a copy of which is included as Exhibit 3 to this Statement.

Also as contemplated by the Amendment Letter and as previously disclosed by the Issuer, on January 11, 2010, the Issuer entered into a Unit Purchase Agreement (the “UBS Purchase Agreement”) with UBS Americas Inc. (“UBS”). Pursuant to the UBS Purchase Agreement, UBS invested $1,760,000 in the Issuer (before deduction of fees and expenses payable or reimbursable by the Issuer pursuant to the LVPIII Purchase Agreement) in exchange for a combination of shares of Series A Preferred and rights to purchase additional shares of Series A Preferred. At the time of the UBS investment (the “UBS Closing”), Fund Holdings purchased 4,218,720 Ordinary Rights in connection with 1,760 Units purchased by UBS, but relinguished its rights to and returned to the Issuer 1,056,000 of such Ordinary Rights. Fund Holdings assigned the remaining 3,162,720 Ordinary Rights to other persons, including Mr. Knetzger. As a result, in connection with the UBS Closing, Mr. Knetzger was issued 1,054,240 Ordinary Rights.

As a requirement of UBS’ investment under the UBS Purchase Agreement, on January 11, 2010, the Issuer, UBS, Fund Holdings, Laidlaw Venture Partners III, Laidlaw & Company (UK) Ltd. and the Majority Stockholders entered into a Stockholders’ Agreement setting forth certain agreements among and between the Issuer and such stockholders (the “Stockholders’ Agreement”). The Stockholders’ Agreement contains the following agreements and obligations, among others:

· In the event that Fund Holdings or the Majority Stockholders seek to sell their shares of Common Stock, UBS shall have the right to sell a pro rata portion of its shares along with such stockholders. Alternatively, the Issuer, at its option, may redeem the applicable shares of Series A Preferred from UBS and the stockholder would be permitted to sell his, her or its shares free of such obligation. The foregoing obligations do not apply to transfers to certain permitted transferees, bona fide pledges and pledges outstanding as of the date of the Stockholders’ Agreement. Such obligations also do not apply to sales by (a) Fund Holdings of up to 17.5% of the securities held by Fund Holdings as of the date of the Stockholders’ Agreement in any consecutive twelve month period and 35% in the aggregate of the securities held by Fund Holdings as of the date of the Stockholders’ Agreement, (b) the JBIV Stockholders of up to 25% in the aggregate of the securities held by such stockholders as of the date of the Stockholders’ Agreement and 45% each in the aggregate of the securities held by the JBIV Stockholders as of the date of the Stockholders’ Agreement, and (c) the JBIII Stockholders of up to 25% in the aggregate of the securities held by such stockholders as of the date of the Stockholders’ Agreement and 45% each in the aggregate of the securities held by the JB III Stockholders as of the date of the Stockholders’ Agreement.

· The Issuer and each stockholder party to the Stockholders’ Agreement (other than UBS) are prohibited from selling their securities to any bank, bank holding company, broker or dealer prior January 11, 2011, unless agreed in writing by UBS. Such restriction shall not apply to (a) market-based sales so long as the selling stockholder is reasonably unaware that it is selling to a bank, bank holding company, broker or dealer, (b) the sale by the

Company of up to an additional 690 units pursuant to the LVPIII Purchase Agreement (subject to certain conditions), (c) a change of control transaction in which the holders of the Issuer’s common stock receive cash consideration of at least $4.00 per share and holders of Series A Preferred receive cash consideration for all of their shares of Series A Preferred Stock equal to no less than the greater of $400.00 per share or 100 times the consideration per share received by holders of common stock, (d) the issuance by the Issuer of shares of common stock upon the exercise of purchase rights which were acquired by Laidlaw Venture Partners III or Laidlaw & Company (UK) Ltd. pursuant to the transactions described in the LVPIII Purchase Agreement, and (e) the distribution of securities owned by Laidlaw Venture Partners III or Laidlaw & Company (UK) Ltd. to its members.

· The Issuer and each stockholder party to the Stockholders’ Agreement (other than UBS) is prohibited from appointing or voting in favor of, as applicable, any nominee to the Company’s board of directors that is affiliated with another bank, bank holding company, broker or dealer unless UBS agrees in writing, except that the foregoing restriction shall not apply to Edwin L. Knetzger III or Michael Sanderson.

· The JBIII Stockholders and the JBIV Stockholders are prohibited from withdrawing their consent to the adoption and approval of the Charter Amendment.

· If, after the date of the Stockholders’ Agreement, any stockholder of the Issuer acquires additional shares of common stock or Series A Preferred such that such stockholder owns twenty percent or more of any class of the outstanding voting capital stock of the Issuer, the Issuer is required to use its reasonable best efforts to have such stockholder become a party to the Stockholders’ Agreement. Additionally, the Issuer is prohibited from issuing any shares of its common stock or Series A Preferred such that the recipient thereof would own twenty percent or more of any class of the outstanding voting capital stock of the Issuer unless such stockholder becomes a party to the Stockholders’ Agreement.

The foregoing description of the Stockholders’ Agreement is a summary only, and is qualified in its entirety by reference to the Stockholders’ Agreement, a copy of which is included as Exhibit 4 to this Statement.

On January 13, 2010 (the “Final Closing”), Fund Holdings purchased 1,653,930 Ordinary Rights in connection with 690 Units purchased by Laidlaw Venture Partners III pursuant to the LVPIII Purchase Agreement and assigned those Ordinary Rights to other persons, including Mr. Knetzger. As a result, in connection with the Final Closing, Mr. Knetzger was issued 413,310 Ordinary Rights.

As of the date of this Statement, Fund Holdings has purchased 3,690 Units, which include 9,841,230 shares of Common Stock and Ordinary Rights with respect to an additional 26,568,000 shares of Common Stock, for a total consideration of $3,693,760.

Item 4.

Purpose of Transaction.

Fund Holdings entered into the Fund Holdings Purchase Agreement and Mr. Knetzger invested in Fund Holdings and became a director of the Issuer for strategic investment purposes and to provide capital to the Issuer to grow and expand its business. In particular, the Reporting Persons believe that their investment will help the Issuer improve and expand its business platform and revenues.

In connection with Fund Holdings initial investment in the Issuer, Mr. Knetzger became the Chairman of the Board of Directors of the Issuer. On December 31, 2009, Mr. Knetzger became the Co-Chairman of the Board of Directors of the Issuer when Michael Sanderson was appointed Co-Chairman.

The responses set forth in Items 3 and 6 of this Statement are incorporated by reference in their entirety into this Item 4.

Mr. Knetzger is a member of the Issuer’s Board of Directors and, as such, may be involved from time to time on behalf of the Issuer in board consideration of matters specified in Item 4 of Schedule 13D. The Reporting Persons intends to review their respective investment in the Issuer from time to time and reserves the right to change their plans and to take any and all actions that they may deem appropriate to maximize the value of their investments, including, acquiring additional securities of the Issuer, disposing of any securities of the Issuer, or formulating other plans or proposals regarding the Issuer or securities of the Issuer to the extent deemed advisable by the Reporting Persons in light of their general investment policies, market conditions, subsequent developments effecting the Issuer (including, but not limited to, the attitude of the Issuer’s board of directors and management and other stockholders) and the general business and future prospects of the Issuer.

Except as described elsewhere in this Statetement, the Reporting Persons currently have no plan or proposal that relates to or would result in any of the actions specified in clauses (a) through (j) of Item 4 of Schedule 13D.

Item 5.

Interest in Securities of the Issuer.

(a) As of January 14, 2010, there are issued and outstanding 76,567,487 shares of Common Stock.

As a result of the Voting Agreement, Mr. Knetzger may be deemed to beneficially own an aggregate of 83,667,502 shares of Common Stock, representing 76.6% of the outstanding shares of Common Stock, of which 9,841,230 shares of Common Stock are owned by Fund Holdings and 41,974,338 shares of Common Stock are owned by the Majority Stockholders. The 83,667,502 shares of Common Stock also include (i) purchase rights issued to Fund Holdings to purchase 26,568,000 shares of Common Stock, of which 18,378,995 shares of Common Stock are subject to certain restrictions that prohibit the exercise of Fund Holding’s rights to purchase such shares until such time that the Issuer files the Charter Amendment, (ii) purchase rights issued to Mr. Knetzger to purchase 5,533,884 shares of Common Stock, all of which are subject to certain restrictions that prohibit the exercise of Mr. Knetzger’s rights to purchase such shares until such time that the Issuer files the Charter Amendment, and (iii) 500,000 shares of Common Stock that Mr. Knetzger has the right to acquire within 60 days upon the exercise of a director stock option. Mr. Knetzger disclaims beneficial ownership of any and all shares beneficially owned by any of the Majority Stockholders and disclaims beneficial ownership of any shares of Common Stock owned by Fund Holdings, except to the extent of his pecuniary interest therein.

As a result of the Voting Agreement, Fund Holdings may be deemed to beneficially own an aggregate of 77,633,618 shares of Common Stock, representing 76.6% of the outstanding shares of Common Stock, of which 9,841,230 shares of Common Stock are owned by Fund Holdings and 41,974,338 shares of Common Stock are owned by the Majority Stockholders. The 77,633,618 shares of Common Stock also include purchase rights issued to Fund Holdings to purchase 26,568,000 shares of Common Stock, of which 18,378,995 shares of Common Stock are subject to certain restrictions that prohibit the exercise of Fund Holding’s rights to purchase such shares until such time that the Issuer files the Charter Amendment. Fund Holdings disclaims beneficial ownership of any and all shares

beneficially owned by Mr. Knetzger or any of the Majority Stockholders.

(b) The Reporting Persons have shared power to vote and shared power to dispose, or direct the disposition, of the shares of Common Stock beneficially owned by Fund Holdings. Mr. Knetzger has sole power to vote and sole power to dispose, or direct the disposition, of the shares of Common Stock beneficially owned by him.

As a result of the Voting Agreement, (i) the Reporting Persons and Majority Stockholders may be deemed in certain circumstances to have shared power to vote the shares of Common Stock beneficially owned by each of them and (ii) the Reporting Persons may be deemed in certain circumstances to have shared power to dispose, or direct the disposition, of the shares of Common Stock beneficially owned by the Majority Stockholders.

(c) Except as described above, during the past sixty days, there were no transactions in shares of Common Stock, or any securities directly or indirectly convertible into or exchangeable for shares of Common Stock, by the Reporting Persons or any person or entity controlled by the Reporting Persons or any person or entity for which the Reporting Persons possess voting or investment control over the securities thereof.

(d) Not applicable.

(e) Not applicable.

Item 6.

Contracts, Understanding, Arrangements and Relationships with Respect to Securities of the Issuer

The responses set forth in Items 3 and 5 of this Statement are incorporated by reference in their entirety into this Item 6.

The Reporting Persons have no agreements with each other with respect to the voting of their Shares, except as provided in the Voting Agreement, or with respect to the disposition of their Shares. The Reporting Persons will vote with the other Voting Agreement Parties for the sole purposes described above in Item 3.

Mr. Angermueller is affiliated with Radnor Research and Trading Company, LLC (“Radnor”), which has entered into a Restated Revenue Sharing Agreement, dated as of November 14, 2009, with the Issuer (the “RSA”). Mr. Angermueller is also the brother of Mr. Knetzger’s spouse.

It is anticipated that Radnor will enter into an agreement with each of Messrs. Angermueller, Hollo and Knetzger pursuant to which Radnor will pay to each of them 30% of the proceeds received by Radnor from the Company under the RSA. As of the date of this Statement, no such agreements had been executed.

Mr. Hollo is the controlling member of The Fund LLC, a financial advisory firm. In connection with the Fund Holdings Purchase Agreement, at the Third Closing, the Issuer entered into a Financial Advisory Agreement with The Fund LLC to retain The Fund LLC’s services with respect to investment banking advice at a rate of $12,000 per month.

In connection with the Initial Closing, Mr. Knetzger, Mr. Hollo and Mr. Angermueller entered into a Service and Fee Agreement, pursuant to which the parties agreed to share certain fees and compensation to be received by them from Fund Holdings and/or the Issuer. Subsequent to September 2, 2009, Mr. Knetzger declared that he would not accept any portion of any fees paid to The Fund LLC under the Financial Advisory Agreement referenced above and renounced his rights with respect thereto.

Also as previously disclosed by the Issuer, on September 2, 2009, Mr. Knetzger was granted an option to purchase 500,000 shares of Common Stock with an exercise price equal to $0.375, the fair market value (as determined by the Issuer’s Board of Directors) on the date of the grant. All of the shares underlying the option fully vested as of the date of the grant and are reported herein.

Item 7.

Material to be Filed as Exhibits.

Exhibit 1. Fund Holdings Purchase Agreement

Exhibit 2. Amendment Letter

Exhibit 3. Voting Agreement

Exhibit 4. Stockholders’ Agreement.

SIGNATURE

After reasonable inquiry and to the best of my knowledge and belief, I certify that this information set forth in this statement is true, complete and correct.

Dated: January 29, 2010


	FUND HOLDINGS, LLC

	By:	/s/ Edwin L. Knetzger, III
		Name:	Edwin L. Knetzger, III
		Title:	Manager


	/s/ Edwin L. Knetzger, III
	Edwin L. Knetzger, III

EXHIBIT INDEX

Exhibit		Description

1		Unit Purchase Agreement, dated as of August 28, 2009, by and between Bonds.com Group, Inc. and Fund Holdings LLC (incorporated by reference to Exhibit 10.1 to Bonds.com Group, Inc.’s Form 8-K, filed with the Securities and Exchange Commission on September 3, 2009)

2		Amendment Letter, dated December 23, 2009, by and between Bonds.com Group, Inc. and Fund Holdings LLC (incorporated by reference to Exhibit 10.1 to Bonds.com Group, Inc.’s Form 8-K, filed with the Securities and Exchange Commission on December 30, 2009)

3		Voting Agreement, dated as of December 23, 2009, by and between Bonds.com Group, Inc., Fund Holdings and the Majority Stockholders (filed herewith)

4		Stockholders’ Agreement, dated as of January 11, 2010, by and between Bonds.com Group, Inc., UBS Americas Inc. and the other stockholders party thereto (incorporated by reference to Exhibit 10.3 to Bonds.com Group, Inc.’s Form 8-K, filed with the Securities and Exchange Commission on January 14, 2010)

EX-3 2 a10-2485_1ex3.htm EX-3

Exhibit 3

VOTING AGREEMENT

THIS VOTING AGREEMENT, dated as of December 23, 2009 (this “Agreement”), is by and among Fund Holdings LLC, a Florida limited liability company (“Holdings”), the parties listed as stockholders on the signature pages hereto (collectively, the “Stockholders”).

RECITALS

WHEREAS, concurrently with the execution of this Agreement, Holdings and the Company are entering into an Amendment Letter, dated as of the date hereof, with respect to that certain Unit Purchase Agreement, dated as of August 28, 2009 (as amended, the “Amended UPA”), between the Company and Holdings;

WHEREAS, Holdings and each of the Stockholders is the record holder of such number of outstanding shares, par value $0.0001 per share, of Common Stock as is listed on the signature pages of this Agreement with respect thereto (the “Current Shares”); and

WHEREAS, as a condition to its willingness to enter into the Amendment Letter, Holdings has required that each of the Stockholders execute and deliver this Agreement, and as a condition to enter into this Agreement, the Stockholders have required that Holdings enter into this Agreement.

AGREEMENT

NOW, THEREFORE, in consideration of the foregoing and the mutual covenants and agreements herein contained, and intending to be legally bound hereby, the parties agree as follows:

1. Definitions.

(a) For purpose of this Agreement, the following terms shall have the meanings set forth below:

“Designated Directors” means (a) Michael Sanderson, as Chairman of the Board of Directors of the Company and (b) Edwin L. Knetzger, III, as Co-chairman of the Board of Directors of the Company.

“Exchange Act” means the Securities Exchange Act of 1934, as amended.

“Person” means any individual, corporation (including not-for-profit), general or limited partnership, limited liability company, joint venture, estate, trust, association, organization, governmental entity or authority or other entity of any kind or nature.

“Securities Act” means the Securities Act of 1933, as amended.

“Transfer” means, with respect to any Voting Shares, any direct or indirect (i) offer, sale, contract to sell, sale of option or contract to purchase, purchase of any option or contract to sell,

grant of any option, right or warrant to purchase, loan, redemption, tender, cash-out or other transfer or disposition, (ii) pledge, grant of lien, preemptive right, security interest, claim, charge or other encumbrance; provided, however, that no pledge, grant of lien security interest or similar encumbrance in existence on the date hereof and securing a bona fide loan or advance of funds shall be deemed a transfer if it provides the Stockholder with the right to vote the Voting Shares in the absence of a default or event of default with respect to such loan or advance of funds, or (iii) entering into any agreement or commitment providing for any of the foregoing.

“Voting Shares” means, with respect to any Person, all issued and outstanding Shares owned of record or beneficially by such Person or over which such Stockholder exercises voting power, in each case, as of the record date for persons entitled (i) to receive notice of, and to vote at, at any annual or special meeting of the stockholders of the Company called for the purpose of voting on the matters referred to in Section 3, or (ii) to take action by written consent of the stockholders of the Company with respect to the matters referred to in Section 3. Any shares of capital stock of the Company that such Person purchases (or has the right or option to purchase pursuant to any other security of the Company) or over which such Person exercises voting power during the period from the date of this Agreement through the date of termination of this Agreement pursuant to Section 11 shall be subject to the terms and conditions of this Agreement to the same extent as if they constituted Voting Shares on the date hereof.

(b) For purposes of this Agreement, capitalized terms used and not defined herein shall have the respective meanings ascribed to them in the Amended UPA.

2. Representations of the Stockholders.

(a) Each Stockholder hereby represents and warrants to Holdings as follows:

(i) Such Stockholder is the record and beneficial owner (for purposes of this Agreement, such term shall have the meaning set forth in Rule 13d-3 under the Exchange Act and the rules and regulations promulgated thereunder, but without regard to any conditions (including the passage of time) to the acquisition of such shares) of, and has good and valid and marketable title to, such Stockholder’s Current Shares.

(ii) As of the date hereof, such Stockholder is not the record or beneficial owner of any shares of Common Stock or other voting securities of the Company, other than such Stockholder’s Current Shares and the shares set forth on Schedule 1, and, except as set forth on such Stockholder’s signature page or Schedule 1, such Stockholder holds no options to purchase or rights to subscribe for or otherwise acquire any securities of the Company, including without limitation any options, warrants, convertible securities or other securities, calls, commitments, conversion privileges, preemptive rights, rights of first refusal, rights of first offer or other rights or agreements outstanding to purchase or otherwise acquire (whether directly or indirectly) any shares of Common Stock or any securities convertible into or exchangeable for any shares of Common Stock or obligating the Company to grant, issue, extend or enter into any such option, warrant, convertible security or other security, call, commitment, conversion privilege, preemptive right, right of first refusal, right of first offer or other right or agreement, and has no other interest in or voting rights with respect to any such securities of the Company.

(iii) Such Stockholder has all requisite power and authority necessary to execute and deliver this Agreement and to consummate the transactions contemplated hereby.

(iv) This Agreement has been duly executed and delivered by such Stockholder and, assuming due execution and delivery of this Agreement by Holdings, constitutes a valid and binding agreement of such Stockholder, enforceable against such Stockholder in accordance with its terms, subject to bankruptcy, insolvency, reorganization, moratorium and similar laws of general applicability relating to or affecting creditors’ rights and to general equity principles (regardless of whether such enforcement is considered in a proceeding at law or in equity).

(v) Other than as set forth in or permitted under this Agreement, such Stockholder’s Voting Shares are now and shall at all times during this Agreement be owned by such Stockholder free and clear of all pledges, liens, proxies, claims, charges, security interests, preemptive rights, voting trusts, voting agreements, options, rights of first offer or refusal and any other encumbrances or arrangements whatsoever with respect to the ownership, transfer or voting of such Voting Shares in any such case that would, individually or in the aggregate, reasonably be expected to materially impair the ability of such Stockholder to perform his obligations under this Agreement, and there are no outstanding options, warrants or rights to purchase or acquire, or agreements or arrangements relating to the voting of, any of such Voting Shares other than this Agreement.

(vi) The execution and delivery of this Agreement by such Stockholder and the performance by such Stockholder of its obligations hereunder will not (including with or without due notice or lapse of time or both):

(1) require any consent, approval, order, authorization or permit of, or registration or filing with or notification to, any governmental entity or authority or other party, except for the filing with the SEC of any Schedules 13D or amendments to Schedules 13D and filings under Section 16 of the Exchange Act, as may be required in connection with this Agreement and the transactions contemplated hereby;

(2) result in any violation or the breach of, or constitute a default under, or give rise to any right of termination, cancellation or acceleration or any payments under, or result in a loss of a benefit or in the creation or imposition of a lien under, any of the terms, conditions or provisions of any note, lease, mortgage, indenture, license, agreement or other instrument or obligation to which such Stockholder is a party or by which such Stockholder or any of his assets are bound that would, individually or in the aggregate, reasonably be expected to materially impair the ability of such Stockholder to perform his obligations under this Agreement or prevent or delay the consummation of any of the transactions contemplated by this Agreement; or

(3) violate the provisions of any order, writ, injunction, judgment, decree, statute, rule or regulation applicable to such Stockholder in such a manner as would, individually or in the aggregate, reasonably be expected to materially impair the ability of such Stockholder to perform his obligations under this Agreement or prevent or delay the consummation of any of the transactions contemplated by this Agreement.

(vii) Such Stockholder understands and acknowledges that Holdings is entering into the Amended UPA in reliance upon such Stockholder’s execution, delivery and performance of this Agreement.

(b) Except where expressly stated to be given as of the date hereof only, the representations and warranties contained in this Agreement shall be made as of the date hereof and as of each date from the date hereof through and including the date of termination of this Agreement.

3. Agreements to Vote Shares.

(a) During the period commencing on the date hereof and continuing until the termination of this Agreement in accordance with its terms, each Stockholder agrees to:

(i) at any annual or special meeting of stockholders of the Company, to the extent permitted by the Company’s bylaws, nominate (or cause to be nominated) for re-election, the Designated Directors as directors of the Company;

(ii) appear (in person or by proxy) at any annual or special meeting of the stockholders of the Company for the purpose of obtaining a quorum;

(A) in favor of: (1) the Designated Directors proposed for election as directors of the Company; (2) the nominees proposed for election as independent directors of the Company by the Board’s nominating committee (the “Independent Directors”); and (3) the Charter Amendment; and

(B) against: (1) any and all proposals to remove any Independent Director or Designated Directors other than in the event of malfeasance; (3) any and all proposals contrary to the Charter Amendment; and (3) any action, proposal, transaction or agreement which would reasonably be expected to result in a breach of any covenant or any other obligation set forth in the Unit Purchase Agreement or of such Stockholder under this Agreement.

(b) During the period commencing on the date hereof and continuing until the termination of this Agreement in accordance with its terms, Holdings agrees to, and agrees to cause its respective affiliates to:

(i) at any annual or special meeting of stockholders of the Company, to the extent permitted by the Company’s bylaws, nominate (or cause to be nominated) for re-election, the Stockholders as directors of the Company;

(ii) appear (in person or by proxy) at any annual or special meeting of the stockholders of the Company for the purpose of obtaining a quorum,

(iii) vote (in person or by proxy), or execute a written consent or consents if stockholders of the Company are requested to vote their shares through the execution of an action by written consent in lieu of any such annual or special meeting of stockholders of the Company, all of such Person’s Voting Shares: (A) in favor of in favor of each Stockholder proposed for election as directors of the Company, (B) against any and all proposals to remove either Stockholder as a director other than in the event of malfeasance, and (C) against any action, proposal, transaction or agreement which would reasonably be expected to result in a breach of any covenant or any other obligation of Holdings under this Agreement.

4. Proxies.

(a) Each Stockholder hereby revokes any and all prior proxies or powers-of-attorney in respect of any of such Stockholder’s Voting Shares and constitutes and appoints Holdings or any nominee of Holdings, with full power of substitution and resubstitution, at any time during the term of this Agreement, as its true and lawful attorney and proxy (its “Proxy”), for and in its name, place and stead, to vote each of such Stockholder’s Voting Shares as its Proxy, at every annual, special, adjourned or postponed meeting of the stockholders of the Company, including the right to sign its name (as stockholder) to any consent, certificate or other document relating to the Company that Delaware law may permit or require, with respect to any matter referred to in Section 3(a).

THE FOREGOING PROXY AND POWER OF ATTORNEY ARE IRREVOCABLE AND COUPLED WITH AN INTEREST THROUGHOUT THE TERM OF THIS AGREEMENT.

(b) Holdings hereby revokes any and all prior proxies or powers-of-attorney in respect of any of its Voting Shares and constitutes and appoints JBIV or any nominee of JBIV, with full power of substitution and resubstitution, at any time during the term of this Agreement, as its true and lawful Proxy, for and in its name, place and stead, to vote each of its Voting Shares as its Proxy, at every annual, special, adjourned or postponed meeting of the stockholders of the Company, including the right to sign its name (as stockholder) to any consent, certificate or other document relating to the Company that Delaware law may permit or require, with respect to any matter referred to in Section 3(b).

THE FOREGOING PROXY AND POWER OF ATTORNEY ARE IRREVOCABLE AND COUPLED WITH AN INTEREST THROUGHOUT THE TERM OF THIS AGREEMENT.

5. Representations of Holdings. Holdings hereby represents and warrants to each Stockholder that:

(a) Holdings is the record and beneficial owner (for purposes of this Agreement, such term shall have the meaning set forth in Rule 13d-3 under the Exchange Act and the rules and regulations promulgated thereunder, but without regard to any conditions (including the passage of time) to the acquisition of such shares) of, and has good and valid and marketable title to, its Current Shares listed on the signature pages hereto.

(b) As of the date hereof, Holdings is not the record or beneficial owner of any shares of Common Stock or other voting securities of the Company, other than its Current Shares and the shares set forth on Schedule 2, and, except as set forth on its signature page or Schedule 2, Holdings holds no options to purchase or rights to subscribe for or otherwise acquire any securities of the Company, including without limitation any options, warrants, convertible securities or other securities, calls, commitments, conversion privileges, preemptive rights, rights of first refusal, rights of first offer or other rights or agreements outstanding to purchase or otherwise acquire (whether directly or indirectly) any shares of Common Stock or any securities convertible into or exchangeable for any shares of Common Stock or obligating the Company to grant, issue, extend or enter into any such option, warrant, convertible security or other security, call, commitment, conversion privilege, preemptive right, right of first refusal, right of first offer or other right or agreement, and has no other interest in or voting rights with respect to any such securities of the Company.

(c) Holdings has all requisite corporate power and authority or legal capacity, as the case may be, to execute and deliver this Agreement and to consummate the transactions contemplated hereby.

(d) The execution, delivery and performance of this Agreement and the consummation of the transactions contemplated hereby have been duly authorized by all requisite limited liability company action and no other limited liability company proceedings on the part of Holdings are necessary to authorize this Agreement or the consummation of the transactions contemplated hereby. This Agreement has been duly and validly executed and delivered and is a valid and binding agreement thereof, enforceable against Holdings in accordance with its terms, subject to bankruptcy, insolvency, reorganization, moratorium and similar laws of general applicability relating to or affecting creditors’ rights and to general equity principles (regardless of whether such enforcement is considered in a proceeding at law or in equity).

(e) Other than as set forth in or permitted under this Agreement, Holdings’ Voting Shares are now owned by Holdings free and clear of all pledges, liens, proxies, claims, charges, security interests, preemptive rights, voting trusts, voting agreements, options, rights of first offer or refusal and any other encumbrances or arrangements whatsoever with respect to the ownership, transfer or voting of such Voting Shares in any such case that would, individually or in the aggregate, reasonably be expected to materially impair Holdings’ ability to perform its obligations under this Agreement, and there are no outstanding options, warrants or rights to purchase or acquire, or agreements or arrangements relating to the voting of, any of such Voting Shares other than this Agreement.

(f) The execution and delivery of this Agreement by Holdings and the performance by Holdings of its obligations hereunder will not (including with or without due notice or lapse of time or both):

(i) require any consent, approval, order, authorization or permit of, or registration or filing with or notification to, any governmental entity or authority or other party, except for the filing with the SEC of any Schedules 13D or amendments to Schedules 13D and filings under Section 16 of the Exchange Act, as may be required in connection with this Agreement and the transactions contemplated hereby;

(ii) result in any violation or the breach of, or constitute a default under, or give rise to any right of termination, cancellation or acceleration or any payments under, or result in a loss of a benefit or in the creation or imposition of a lien under, any of the terms, conditions or provisions of any note, lease, mortgage, indenture, license, agreement or other instrument or obligation to which it or he is a party or by which it or he or any of its assets are bound that would, individually or in the aggregate, reasonably be expected to materially impair the its ability to perform its obligations under this Agreement or prevent or delay the consummation of any of the transactions contemplated by this Agreement; or

(iii) violate the provisions of any order, writ, injunction, judgment, decree, statute, rule or regulation applicable to it or him in such a manner as would, individually or in the aggregate, reasonably be expected to materially impair its ability to perform its obligations under this Agreement or prevent or delay the consummation of any of the transactions contemplated by this Agreement.

(iv) Holdings understands and acknowledges that the Stockholders are entering this Agreement in reliance upon its execution, delivery and performance of this Agreement.

6. Restrictions on Transfer.

(a) Restrictions Applicable to the Stockholders.

(i) Subject to the terms of this Agreement, for a period beginning on the date hereof and continuing until the termination of this Agreement in accordance with its terms (the “Voting Period”), each Stockholder agrees that he will not Transfer any Voting Shares except pursuant to (A) a Permitted Transfer or (B) a merger, consolidation, tender offer or other similar transaction involving an acquisition of all or substantially all of the capital stock of the Company. Furthermore, without the prior written consent of Holdings, neither Stockholder shall: (x) grant any proxies with respect to any of such Stockholder’s Voting Shares, or (y) enter into any voting agreement, voting trust or other voting arrangement with respect to any of such Stockholder’s Voting Shares.

(ii) The term “Permitted Transfer” means Transfers of any of such Stockholder’s Voting Shares (A) if, after giving effect to such Transfer, the Stockholders, Fund Holdings and its affiliates and Laidlaw and its affiliates would hold, in the aggregate, at least a majority of then-outstanding shares of the Company’s voting stock,

(B) during any period in which, for the immediately preceding two month period, (x) the Company’s Common Stock traded at an average daily price per share of at least $1.50 and (y) the average daily trading volume was at least 50,000 shares, (C) Transfers in connection with strategic transactions in which the Company receives assets or other consideration the value of which, as determined in good faith by a majority of the Company’s directors (other than the Stockholders), equals or exceeds the fair market value of the Voting Shares Transferred by the Stockholders in such transaction, or (D) to affiliates or family members or by gift, will or intestacy, including, without limitation, transfers by gift, will or intestacy to family members of such Stockholder or to a settlement or trust established under the laws of any country; provided, that in the event of any Permitted Transfer described in clause (C) or (D), the transferee shall enter into an agreement substantially in the form hereof (or a joinder hereto in a form reasonably satisfactory to Holdings) and agrees to be bound by its terms.

(b) Restrictions Applicable to Holdings. Subject to the terms of this Agreement, during the Voting Period, Holdings agrees that it or he will not, without the prior written consent of the Stockholders: (i) grant any proxies with respect to any of such its Voting Shares, or (ii) enter into any voting agreement, voting trust or other voting arrangement with respect to any of its Voting Shares.

7. Additional Covenant of Stockholders. Each Stockholder shall notify Holdings of any development occurring after the date of this Agreement that causes, or that would reasonably be expected to cause, any breach of any of the representations and warranties set forth in Section 2 hereof.

8. Expenses. Except as otherwise expressly provided herein, each of the parties hereto shall bear and pay all costs and expenses incurred by them or on their behalf in connection with the transactions contemplated hereunder, including fees and expenses of their own financial consultants, investment bankers, accountants and counsel.

9. Specific Performance. Each party hereto acknowledges that irreparable damage would occur in the event that any of the provisions of this Agreement were not performed in accordance herewith or were otherwise breached. Accordingly, each party hereto agrees that injunctive relief or any other equitable remedy, in addition to remedies at law or in damages, is the appropriate remedy for any such breach and will not oppose the granting of such relief on the basis that the other party has an adequate remedy at law or in damages. Each party hereto agrees that it will not seek, and agrees to waive any requirement for, the securing or posting of a bond in connection with any other party’s seeking or obtaining such equitable relief.

10. Successors and Assigns. This Agreement shall be binding upon, inure to the benefit of, and be enforceable by the parties hereto and their respective successors, assigns, heirs and devises, as applicable. This Agreement shall not be assignable without the written consent of the other party hereto.

11. Termination. This Agreement will terminate automatically, without any action on the part of any party hereto, on the earlier of (a) at any time by mutual agreement between Holdings and the Stockholders, (b) the third anniversary of the Third Closing, (c) the date on which

Holdings no longer owns, beneficially or of record, a number of shares of the Company’s common stock equal to at least 10% of its Current Shares and (d) the date on which the Stockholders no longer collectively own, beneficially or of record, a number of shares of the Company’s common stock equal to at least 10% of their collective Current Shares.

12. Entire Agreement. This Agreement (including the documents and the instruments referred to herein) constitutes the entire agreement and supersedes all prior agreements and understandings, both written and oral, between the parties with respect to the subject matter hereof.

13. Governing Law. This Agreement shall be governed by, and construed in accordance with, the internal laws of the State of Delaware, without regard to the conflicts of laws provisions thereof.

14. Jurisdiction; Waiver of Venue. Each of the parties irrevocably agrees that any legal action or proceeding arising out of or related to this Agreement or for recognition and enforcement of any judgment in respect hereof brought by any other party hereto or its successors or assigns may be brought and determined in the Court of Chancery in and for New Castle County in the State of Delaware (or, if such court lacks jurisdiction, any appropriate state or federal court in New Castle County in the State of Delaware), and each of the parties hereby irrevocably submits to the exclusive jurisdiction of the aforesaid courts for itself and with respect to its property, generally and unconditionally, with regard to any such action or proceeding arising out of or relating to this Agreement and the transactions contemplated hereby (and agrees not to commence any action, suit or proceeding relating thereto except in such courts). Each of the parties agrees further to accept service of process in any manner permitted by such courts. Each of the parties hereby irrevocably and unconditionally waives, and agrees not to assert, by way of motion or as a defense, counterclaim or otherwise, in any action or proceeding arising out of or related to this Agreement or the transactions contemplated hereby, (i) any claim that it is not personally subject to the jurisdiction of the above-named courts for any reason other than the failure lawfully to serve process, (ii) that it or its property is exempt or immune from jurisdiction of any such court or from any legal process commenced in such courts (whether through service of notice, attachment prior to judgment, attachment in aid of execution of judgment, execution of judgment or otherwise), (iii) to the fullest extent permitted by law, that (A) the suit, action or proceeding in any such court is brought in an inconvenient forum, (B) the venue of such suit, action or proceeding is improper or (C) this Agreement, or the subject matter hereof, may not be enforced in or by such courts and (iv) any right to a trial by jury.

15. Notices. All notices and other communications hereunder shall be in writing and shall be deemed to have been duly given or made by a party hereto only upon receipt by the receiving party at the following addresses (if mailed) or the following telecopy numbers (if delivered by facsimile), or at such other address or telecopy number for a party as shall be specified by like notice:

(a) if to Holdings, to

Fund Holdings LLC

c/o DivcoWest

575 Market Street, 35th Floor

San Francisco, CA 94105

Attention: Edwin L. Knetzger, III

Telecopy: (415) 995-5555

with a copy (which shall not constitute notice) to:

Gibson, Dunn & Crutcher LLP

2029 Century Park East

Los Angeles, California 90067

Attention: Mark S. Lahive, Esq.

Telecopy: (310) 552-7038

(b) if to a Stockholder, to

[Stockholder]

Attention:

Telecopy:

16. Severability. This Agreement shall be deemed severable; the invalidity or unenforceability of any term or provision of this Agreement shall not affect the validity or enforceability of the balance of this Agreement or of any other term hereof, which shall remain in full force and effect. If any of the provisions hereof are determined to be invalid or unenforceable, the parties shall negotiate in good faith to modify this Agreement so as to affect the original intent of the parties as closely as possible.

17. Waiver. The parties hereto may, to the extent permitted by applicable law, subject to Section 18 hereof, (a) waive any inaccuracies in the representations and warranties contained herein or in any document delivered pursuant hereto or (b) waive compliance with any of the agreements or conditions contained herein. Any agreement on the part of a party hereto to any such waiver shall be valid only if set forth in a written instrument signed on behalf of such party. The failure of any party to this Agreement to assert any of its rights under this Agreement or otherwise shall not constitute a waiver of those rights.

18. Modification. No supplement, modification or amendment of this Agreement will be binding unless made in a written instrument that is signed by all of the parties hereto and that specifically refers to this Agreement.

19. Counterparts. This Agreement may be executed in counterparts, all of which shall be considered one and the same agreement and shall become effective when such counterparts have been signed by each of the parties and delivered to the other parties, it being understood that all parties need not sign the same counterpart.

20. Headings. All Section headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement.

21. No Other Voting Limitations. Holdings and the Stockholders shall be free to vote in favor of or against any matter not covered by Section 3(a) or 3(b), as applicable.

[Signature Page Follows]

IN WITNESS WHEREOF, the parties hereto have executed and delivered this Agreement as of the date first written above.

	FUND HOLDINGS LLC


	By:
		Name: Edwin L. Knetzger, III
		Title: Manager

[Signature Page to Voting Agreement]

JOHN J. BARRY, III
AND HOLLY A.W. BARRY



John J. Barry, III



Holly A.W. Barry

Shares of Common Stock held by
Stockholder as of the date hereof: 15,724,388

DUNCAN FAMILY, LLC


	By:
		John J. Barry, III, Managing Member


	By:
		Holly A.W. Barry, Managing Member


Shares of Common Stock held by
Stockholder as of the date hereof: 4,000,000

DUNCAN FAMILY RECOVABLE TRUST


	By:
		John J. Barry, III, Co-Trustee


	By:
		Holly A.W. Barry, Co-Trustee


Shares of Common Stock held by
Stockholder as of the date hereof: 1,000,000

[Signature Page to Voting Agreement]

OTIS ANGEL, LLC


	By:
		John J. Barry, IV, Authorized Person


Shares of Common Stock held by
Stockholder as of the date hereof: 10,000,000

SIESTA CAPITAL, LLC


	By:
		John J. Barry, IV, Authorized Person


Shares of Common Stock held by
Stockholder as of the date hereof: 5,000,000

BOND PARTNERS, LLC


	By:
		John J. Barry, IV, Authorized Person


Shares of Common Stock held by
Stockholder as of the date hereof: 2,000,000

JOHN J. BARRY IV REVOCABLE TRUST
U/A/D NOVEMBER 9, 2001


	By:
		John J. Barry, IV, Trustee


Shares of Common Stock held by
Stockholder as of the date hereof: 3,500,000

[Signature Page to Voting Agreement]

Schedule 1

Schedule 2

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