-----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, PNLlZBfWCHBi3TZNacG3/nrNRxRMqJT/1MKQC4X4fPBaWUFTgAnO5i4laS8VTBBw IpoJuzGiPLxx88DK7smXEQ== 0001047469-97-009081.txt : 19971231 0001047469-97-009081.hdr.sgml : 19971231 ACCESSION NUMBER: 0001047469-97-009081 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19971218 ITEM INFORMATION: FILED AS OF DATE: 19971230 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: VISUAL EDGE SYSTEMS INC CENTRAL INDEX KEY: 0001015172 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-MEMBERSHIP SPORTS & RECREATION CLUBS [7997] IRS NUMBER: 133778895 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 000-20995 FILM NUMBER: 97746125 BUSINESS ADDRESS: STREET 1: 2424 NORTH FEDERAL HIGHWAY STREET 2: SUITE 100 CITY: BOCA RATON STATE: FL ZIP: 33431 BUSINESS PHONE: 5617507559 MAIL ADDRESS: STREET 1: 2424 NORTH FEDERAL HIGHWAY STREET 2: SUITE 100 CITY: BOCA RATON STATE: FL ZIP: 33431 8-K 1 FORM8-K UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 _____________ FORM 8-K CURRENT REPORT Pursuant to Section l3 or l5(d) of the Securities Exchange Act of l934 Date of Report (Date of earliest event reported) December 18, 1997 ----------------- VISUAL EDGE SYSTEMS INC. ------------------------------------------------------ (Exact name of registrant as specified in its charter) Delaware 0-20995 13-3778895 ------------------------------------------------------------------------------ (State or other juris- (Commission (I.R.S. Employer diction of incorporation) File Number) Identification No.) 2424 North Federal Highway, Suite 100, Boca Raton, FL 33431 ----------------------------------------------------------------------------- (Address of principal executive offices) (Zip Code) (561) 750-7559 -------------- (Registrant's telephone number, including area code) Item 5. Other Events On December 18, 1997, Visual Edge Systems Inc. (the "Company") and the Cadillac Motor Car Division of General Motors Corporation ("Cadillac") entered into an Amended and Restated Guarantee and Agreement (the "Amended Agreement"), which amended the terms of the Company's prior agreement with Cadillac entered into on August 5, 1997 (the "Original Agreement"). As was the case with the Original Agreement, the Amended Agreement grants Cadillac the U.S. dealership showroom rights to the Company's One-on-One with Greg Norman concept, allowing Cadillac to offer its customers a free video golf lesson personally analyzed by Greg Norman if they test drive a Cadillac. Such dealership showroom rights had been granted exclusively to Cadillac, subject to the limitations on exclusivity set forth below. The Amended Agreement extended the rights to the concept to other General Motors divisions. The Company is to provide each participating Cadillac or General Motors dealership with all marketing materials related to this promotion, including creative for print and radio advertisements, banners and posters. While the Original Agreement provided for a test phase period ending on December 31, 1997, after which Cadillac had the right to terminate the Original Agreement at any time through January 31, 1998, the term of the Amended Agreement runs through December 31, 2000, without any reference to a test phase. Provided the Company has enough vans in operation to service all of the Cadillac or General Motors dealers on a nationwide basis, for the period from December 18, 1997 through December 31, 1998, Cadillac has guaranteed to purchase a total of 1,500 "Event Days" from the Company. Each "Event Day" is a day on which one of the Company's One-on-One vans appears at a Cadillac dealership to provide up to 150 instructional videotapes for Cadillac's customers. On or prior to August 31, 1998, the Company must notify Cadillac as to whether the guaranteed number of "Event Days" are scheduled to be conducted by December 31, 1998. If 1,500 "Event Days" are not scheduled and conducted by December 31, 1998, then the Company is no longer obligated to provide its product exclusively to Cadillac, and may offer its product to auto dealerships other than Cadillac and General Motors dealerships. In each of the periods from January 1, 1999 through December 31, 1999 and January 1, 2000 through December 31, 2000, the terms of the Amended Agreement remain the same, except that the number of "Event Days" guaranteed by Cadillac increases to 2,500 in each of such periods. In the event that in any given year the number of actual "Event Days" conducted by the Company is less than the number of "Event Days" guaranteed by Cadillac (1,500 or 2,500, as the case may be), then the Company is no longer obligated to provide its product exclusively to Cadillac; in such event Cadillac, however, has no obligation to pay the Company for the difference between the guaranteed number of "Event Days" and the actual number of "Event Days" provided by the Company to Cadillac dealerships. The Company currently has 15 vans in operation, though it believes it will need approximately 25 vans to potentially realize the minimum guarantee of 1500 "Event Days" for 1998. The Company believes that it will require 30 to 35 vans in the years 1999 and 2000 to potentially realize the minimum guarantee of 2500 "Event Days." 2 (c) Exhibits 99.1 Amended and Restated Guarantee and Agreement, dated as of December 18, 1997, between Visual Edge Systems Inc. and Cadillac Motor Car Division of General Motors Corporation. 3 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of l934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. VISUAL EDGE SYSTEMS INC. -------------------------- (Registrant) By: /s/ Earl T. Takefman ---------------------------- Earl T. Takefman Chief Executive Officer Date: December 30, 1997 4 EXHIBIT INDEX No. --- 99.1 Amended and Restated Guarantee and Agreement, dated as of December 18, 1997, between Visual Edge Systems Inc. and Cadillac Motor Car Division of General Motors Corporation. EX-99.1 2 EXH99.1 Exhibit 99.1 December 18, 1997 AMENDED AND RESTATED GUARANTEE AND AGREEMENT Amended and Restated Guarantee and Agreement, dated as of December 18, 1997, between VISUAL EDGE SYSTEMS INC. ("VES"), a Delaware corporation ("VES"), and CADILLAC MOTOR CAR DIVISION OF GENERAL MOTORS CORPORATION, a Delaware corporation ("Cadillac"). RECITALS WHEREAS, Cadillac desires to implement a test drive program in which Cadillac Dealers nationwide will have the opportunity to invite potential customers to take a "personalized golf lesson with Greg Norman" if they test drive a new Cadillac (the "Test Drive Program"); and WHEREAS, Cadillac desires that VES provide, and VES is willing to provide, certain services relating to the production of Greg Norman personalized video golf lessons in connection with the Test Drive Program on the terms and conditions hereinafter set forth; WHEREAS, VES and Cadillac executed a Guarantee and Agreement on August 5, 1997 and desire to amend and restate such agreement in its entirety; NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows: Section 1. Definitions. The following terms shall have the meanings set forth below. Terms defined in the singular shall have a comparable meaning when used in the plural, and vice versa. "Cadillac" means Cadillac Motor Car Division, a Division of General Motors Corporation. "Cadillac Dealers" means an independent automotive dealer that sells Cadillac automobiles that is in a state that is serviced by VES in accordance with Schedule II. "CDMA" means the Cadillac Dealers Marketing Association, a regional group of independent Cadillac dealers. "Event Day" means any day on which VES vans have been scheduled to appear at a Participating Dealership in connection with the Test Drive Program, and that is no longer than the time it takes to complete up to 150 instruction tapes, including videotaping and production time. "Greg Norman Appearance" shall have the meaning set forth in Section 2(e). "Marketing Material" shall have the meaning set forth in Schedule III hereto. "Minimum Guarantees" shall have the meaning set forth in Section 3(c). "Participating Dealership" means any Cadillac Dealer participating in the Test Drive Program. "Product" shall mean a One-on-One with Greg Norman personalized videotape golf lesson of approximately 45 minutes. "Scheduling Party" shall have the meaning set forth in Section 3. "Services" shall have the meaning set forth in Schedule I hereto. "Term" shall have the meaning set forth in Section 4. "Territory" means the continental United States. "Test Drive Program" shall have the meaning set forth in the recitals hereto. Section 2. Exclusivity; Product and Services (a) Exclusive Nature. During the Term of this Agreement and in the Territory, subject to the terms of the Services set forth in Schedule I hereto, VES shall not itself or through others directly or indirectly sell or provide (or cause to be sold or provided) the Product in automotive dealership of any other automobile manufacturer; provided that VES may provide the Product to any automobile manufacturer in connection with non-dealership events, including, but not limited to, events 2 taking place on golf courses, as well as charity tournaments, sales meetings, trade shows, conventions and corporate outings. Cadillac has agreed to expand this Agreement to permit VES to provide the Product to the dealerships of other General Motors divisions. (b) Product and Services. During the Term (defined below), VES shall provide to Cadillac the Product and the Services described in Schedule I hereof; provided that VES shall not be obligated to provide any Services that would be in contravention of law. (c) Scheduling. Cadillac, CDMA or a Cadillac Dealer must advise VES of its intention to use the Services no less than sixty (60) days prior to the requested Event Day(s). VES will use its best efforts to accommodate the Scheduling Party (as defined below) within its schedule. (d) Quality. The Services to be provided hereunder shall be consistent in kind and quality with those customarily provided by VES. (e) Greg Norman Appearance. If Cadillac is in compliance with the terms and conditions of this Agreement (including, with respect to each calendar year beginning January 1, 1999, the attainment of the Minimum Guarantee provided for in Section 3(c)), VES will create an annual event at which VES will make Greg Norman available to play a round of golf at The Medalist Golf Course in Hobe Sound, Florida with an individual designated by Cadillac. (f) Extent of Services. VES shall use its reasonable efforts to provide the Services to all Cadillac Dealers, subject to the availability and location in the United States of VES personnel, vans and other equipment and in accordance with the scheduling guidelines set forth herein. As VES expands its fleet of vans to states other than those listed in Schedule II, it will notify Cadillac quarterly by delivering an updated Schedule II, listing the states with VES vans and information regarding availability and other factors limiting the availability of Services. Each such expansion to additional states shall increase the aggregate number of Event Days per Cadillac Dealer per calendar year included in the Minimum Guarantee referred to in Section 3(c). 3 Section 3. Financial Arrangements. (a) Billed Parties. The party that schedules an Event Day (a "Scheduling Party") shall be the party that is billed for such Event Day. A Scheduling Party may include Cadillac, a Participating Dealer, CDMA, or other General Motors divisions, their dealers or DMAs. (b) Fees. The Scheduling Party will pay VES fees for each Event Day conducted during the periods described below as follows: Time Period Amount Per Event Day ------------- ---------------------- Through December 31, 1998 $5,300 January 1, 1999 through $5,625 December 31, 1999 January 1, 2000 through $5,900 December 31, 2000 (c) Cadillac Guarantee. For the time period from the execution of this contract to December 31, 1998, Cadillac (together with the CDMAs and Participating Dealerships) guarantees to purchase a total of 1,500 Event Days from VES. Throughout the Term, VES shall notify Cadillac on a monthly basis of the number of Event Days conducted and scheduled to date. No later than August 31, 1998, VES shall notify Cadillac as to whether the guaranteed number of Event Days is scheduled to be conducted during the period. If 1,500 Event Days (unless such number is reduced in accordance with Section 13) are not scheduled and conducted by December 31, 1998 then VES shall no longer be obliged to provide the Product exclusively to Cadillac in accordance with Section 2(a) of this Agreement and, notwithstanding Section 2(a), may provide the Product to automotive dealerships of other automobile manufacturers. In such event, however, Cadillac shall have no financial obligation to VES with respect to the difference between the guaranteed 1,500 Event Days and the actual number of Event Days conducted during the period. For January 1, 1999 to December 31, 1999, Cadillac (together with the CDMAs and Participating Dealerships) guarantees to purchase a total of 2,500 Event Days from VES. 4 Throughout the Term, VES shall notify Cadillac on a monthly basis of the number of Event Days conducted and scheduled to date for calendar year 1999. No later than August 31, 1999, VES shall notify Cadillac as to whether the guaranteed number of Event Days is scheduled to be conducted during the calendar year 1999. If 2,500 Event Days (unless such number is reduced in accordance with Section 13) are not scheduled and conducted in calendar year 1999, then VES shall no longer be obliged to provide the Product exclusively to Cadillac in accordance with Section 2(a) of this Agreement and, notwithstanding Section 2(a), may provide the Product to automotive dealerships of other automobile manufacturers. In such event, however, Cadillac shall have no financial obligation to VES with respect to the difference between the guaranteed 2,500 Event Days and the actual number of Event Days conducted during the period. For January 1, 2000 to December 31, 2000, Cadillac (together with the CDMAs and Participating Dealerships) guarantees to purchase a total of 2,500 Event Days from VES. Throughout the Term, VES shall notify Cadillac on a monthly basis of the number of Event Days conducted and scheduled to date for calendar year 2000. No later than August 31, 2000, VES shall notify Cadillac as to whether the guaranteed number of Event Days is scheduled to be conducted during the calendar year 2000. If 2,500 Event Days (unless such number is reduced in accordance with Section 13) are not scheduled and conducted in calendar year 2000, then VES shall no longer be obliged to provide the Product exclusively to Cadillac in accordance with Section 2(a) of this Agreement and, notwithstanding Section 2(a), may provide the Product to automotive dealerships of other automobile manufacturers. In such event, however, Cadillac shall have no financial obligation to VES with respect to the difference between the guaranteed 2,500 Event Days and the actual number of Event Days conducted during the period. (d) Expenses. Travel, lodging and similar costs and expenses of VES employees and third parties performing the Services shall be borne by VES. (e) Payments. During the Term, VES will invoice the Scheduling Party for fees payable hereunder as follows: (i) 50% 30 days after the booking of an Event Day and (ii) 50% to be payable 30 days after the Event Day, or as otherwise agreed between VES and the Scheduling Party. Any additional charges are due and payable upon presentation. 5 (f) Third Parties. VES will have the right to retain third parties to provide services on its behalf from time to time, in accordance with VES's customary practice in the ordinary course of business. The use by VES of any such third party will be subject to approval by Cadillac, which shall not be unreasonably withheld; provided that if requested by Cadillac, VES will keep Cadillac advised quarterly regarding any significant use of such third parties. VES shall be responsible for the payment of any fees and expenses of third parties retained by VES. Section 4. Term. (a) Term. This Agreement shall continue in effect until December 31, 2000, unless terminated in accordance with Section 3(c) or 4(b) below (the "Term"). (b) Non-payment. In the event that any Scheduling Party hereunder fails to make a payment to VES hereunder, and such failure has not been cured within fifteen (15) days after receipt of written notice from VES, VES may terminate this Agreement by notice to Cadillac which (unless Cadillac is the Scheduling Party) shall have thirty (30) additional days to cure the failure by such Scheduling Party. Section 5. Independent Contractor. (a) Selection of Employees. VES shall select the VES employees and third parties to provide Services hereunder on a basis consistent with its normal practice, and such individuals shall not be deemed to be employees of Cadillac or any of its subsidiaries. All work performed hereunder by VES shall be performed by VES as an independent contractor. (b) No Joint Venture. Notwithstanding anything herein to the contrary, no partnership or joint venture has been created in or by this Agreement or as a result of the provision of Services hereunder. Section 6. Trademarks. It is expressly agreed by the parties that neither Cadillac shall acquire any rights to any of VES's proprietary information (whether owned or licensed), including, but not limited to, its software, technology, 6 concepts, the "One-on-One with Greg Norman" trade name or other trade names, or other intellectual property, and that VES shall not acquire any rights to any Cadillac trade names or trademarks or other intellectual property pursuant to this Agreement. Each party agrees that it will obtain prior written approval before using the other's trade names, trademarks or other intellectual property. Section 7. Amendment. This Agreement may be amended only by an instrument in writing executed by the parties hereto. Section 8. Notices. All notices and other written communications hereunder shall be in writing and shall be delivered personally against written receipt, by a nationally recognized overnight courier service or by prepaid, registered or certified mail, return receipt requested, to the following persons and addresses (or to such other persons or addresses as any party may request by notice to the other parties): If to VES: Visual Edge Systems Inc. 24-24 North Federal Highway Suite 100 Boca Raton, Florida 33431 Attention: Mr. Earl Takefman With a copy to: Morgan, Lewis & Bockius LLP 101 Park Avenue New York, New York 10178 Attention: David W. Pollak, Esq. If to Cadillac: Cadillac Motor Car Division 30009 Van Dyke Warren, MI Attention: Mr. Brian Small With a copy to: DMB&B 3310 W. Big Beaver P.O. Box 5012 Troy, MI 48007-5012 Attention: Mr. Gust Kouvaris Section 9. Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the 7 State of Michigan without giving effect (to the fullest extent permitted by law) to any choice of law rule that would cause the application of the laws of any other jurisdiction. Section 10. Severability. Any term or provision of this Agreement that is invalid or unenforceable in any situation in any jurisdiction shall not affect the validity or enforceability of the offending term or provision in any other situation or in any other jurisdiction. Section 11. Arbitration. Any dispute or controversy arising under this Agreement and relating to an amount in dispute of less than $100,000, which cannot be settled amicably by the parties, shall be referred to a single arbitrator to be chosen by the rules of the American Arbitration Association and the arbitration shall be conducted in New York, New York in accordance with the applicable rules and procedures of the American Arbitration Association. The arbitrator's decision shall be in writing, shall be final and shall be binding upon the parties. Section 12. Schedules. The Schedules to this Agreement are deemed a part of this Agreement and are subject to all of the provisions herein. Section 13. Force Majeure. Any delay or failure of either party to perform its obligations hereunder shall be excused to the extent that it is caused by an event or occurrence beyond its reasonable control, such as, by way of example and not by way of limitation, acts of God, actions by governmental authority (whether valid or invalid), fires, floods, windstorms, explosions, riots, natural disasters, wars, sabotage or labor problems; provided the party claiming force majeure promptly notifies the other party of the event of force majeure, the anticipated duration of the event of force majeure, and the steps being taken to remedy the failure. Section 14. Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original but all of which together will constitute one and the same instrument, and all signatories need not appear on any one counterpart. 8 IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and year first above written. VISUAL EDGE SYSTEMS INC. By: /s/ Earl Takefman ---------------------- Earl Takefman Chief Executive Officer Date: CADILLAC MOTOR CAR DIVISION OF GENERAL MOTORS CORPORATION By: /s/ Gust Kouvaris ----------------- Date: SCHEDULE I DESCRIPTION OF SERVICES TO BE PROVIDED On the agreed upon Event Day, VES will arrive 2 hours prior to the scheduled time for set up purposes. VES shall provide the following services to the Participating Dealer: 1. The Marketing Materials as listed in Schedule III. 2. The One-on-One with Greg Norman van, trailer and all hardware and software needed to execute the Product. 3. Two VES employees to videotape Cadillac participants and execute the Product. 4. An indoor hitting cage (if indoors) which requires a floor area of 20' x 20' and 12' high. An Event Day shall consist of the time it takes (excluding set-up time) to complete up to 150 instruction tapes, including video taping and production time, for the fee detailed in Section 3(b). Each Participating Dealer shall receive up to a maximum of 150 videotapes of the Product per Event Day. Additional videotapes may be purchased for $25.00 per tape. i SCHEDULE II STATES COVERED BY VES VANS AS OF December 31, 1997 STATES ------ Arizona California Connecticut Delaware Florida Georgia Illinois Maryland Massachusetts Michigan Nevada New Jersey New York Pennsylvania Rhode Island South Carolina Texas Virginia West Virginia VES will update Cadillac quarterly of new states in which it has vans available for service. VES will use its best efforts to provide additional vans in other states if the confirmed demand for vans exists. ii SCHEDULE III DESCRIPTION OF MARKETING MATERIALS TO BE PROVIDED Marketing Materials: VES will provide marketing materials to each Participating Dealership to be used in the Test Drive Program. Such marketing materials shall be supplied at least forty-five days prior to the Event Day and shall include for each Event Day: (i) creative approved by Cadillac for print, radio and television advertisements for use by the Participating Dealerships at their option. (ii) on-site promotional materials, such as banners and posters in an amount to be mutually agreed upon. (iii) a sales video and a How to Guarantee Your Success manual to be given to each Participating Dealership to educate their staff on preparation for an Event Day. (iv) customized Cadillac videotape sleeves and labels for each video tape provided to a Participating Dealership customer. All such marketing materials shall be pre-approved by Cadillac. Before finalizing the form of any and all marketing material, VES shall forward to Cadillac a written proposal setting forth: (i) the proposed final form of the material and (ii) the proposed manner in which the material is designed to be used. Cadillac's approval of any such material submitted by VES must be given to VES by Cadillac in writing. iii -----END PRIVACY-ENHANCED MESSAGE-----