-----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, KgmfzyLwqNt2dGMa/sz/2N2ABGprwM0VWixi6xm+3AH79xCzyFfk0LBeqijqrtaW DDKKeH9P8bHr7mgls135ww== 0001012895-99-000032.txt : 19990413 0001012895-99-000032.hdr.sgml : 19990413 ACCESSION NUMBER: 0001012895-99-000032 CONFORMED SUBMISSION TYPE: PREM14C PUBLIC DOCUMENT COUNT: 2 FILED AS OF DATE: 19990412 FILER: COMPANY DATA: COMPANY CONFORMED NAME: REXFORD INC CENTRAL INDEX KEY: 0001065189 STANDARD INDUSTRIAL CLASSIFICATION: BLANK CHECKS [6770] IRS NUMBER: 870502701 STATE OF INCORPORATION: UT FILING VALUES: FORM TYPE: PREM14C SEC ACT: SEC FILE NUMBER: 000-24721 FILM NUMBER: 99591674 BUSINESS ADDRESS: STREET 1: 1661 LAKEVIEW CIRCLE CITY: OGDEN STATE: UT ZIP: 84403 BUSINESS PHONE: 8013993632 PREM14C 1 PRELIMINARY INFORMATION STATEMENT 1 Preliminary Information Statement Dated: April 12, 1999 REXFORD, INC. NOTICE OF SPECIAL MEETING OF SHAREHOLDERS TO BE HELD MAY 3, 1999 TO THE SHAREHOLDERS OF REXFORD, INC.: A special meeting of the shareholders (the "Special Meeting") of Rexford, Inc., the ("Company"), will be held at 3090 East 3300 South, Suite 400, Salt Lake City, Utah 84109, at 10:00 a.m., Mountain Time, to ratify and approve the Agreement and Plan of Reorganization (the "Acquisition Proposal")entered into between the Company and Chicago Map Corporation ("CMC") that provides for (A) the implementation of a 1-for-70 reverse split of all of the Company's issued and outstanding shares of common stock; (B) the issuance of 10,500,000 shares of the Company's post-reverse split common stock to the CMC shareholders in exchange for all of the CMC common stock; (C) changing the name of the Company to "Lexon Technologies, Inc."; and (D) electing Steven J. Peskaitis, Mike Barnett, Paris Karahalios, and Thomas W. Rieck, all nominees of CMC, as directors of the Company, to serve until the next annual meeting of shareholders or until their successors are duly elected and qualified. The approval of the Acquisition Proposal by the shareholders will constitute approval of each of the foregoing. At the Special Meeting the shareholders will also transact such other business as may properly come before the Special Meeting or any adjournment thereof. THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE "FOR" THE ACQUISITION PROPOSAL WHICH IS DESCRIBED IN MORE DETAIL IN THE ACCOMPANYING INFORMATION STATEMENT. ONLY SHAREHOLDERS OF RECORD AT THE CLOSE OF BUSINESS ON MARCH 26, 1999 (THE "RECORD DATE"), ARE ENTITLED TO NOTICE OF AND TO VOTE AT THE SPECIAL MEETING. MEMBERS OF MANAGEMENT AND PRINCIPAL SHAREHOLDERS WHO, COLLECTIVELY HOLD IN EXCESS OF 50% OF THE COMPANY'S ISSUED AND OUTSTANDING SHARES, HAVE INDICATED THEIR INTENTION TO VOTE IN FAVOR OF THE ACQUISITION PROPOSAL. AS A RESULT, THE ACQUISITION PROPOSAL WILL BE APPROVED WITHOUT THE AFFIRMATIVE VOTE OF ANY OTHER SHAREHOLDERS. ALTHOUGH MANAGEMENT IS NOT ASKING FOR A PROXY AND YOU ARE REQUESTED NOT TO SEND US A PROXY, SHAREHOLDERS MAY BE PRESENT AT THE SPECIAL MEETING AND VOTE THEIR SHARES IN PERSON OR BY PROXY. MANAGEMENT DOES, HOWEVER, ENCOURAGE ALL SHAREHOLDERS TO ATTEND THE SPECIAL MEETING IN PERSON. BY ORDER OF THE BOARD OF DIRECTORS /S/Dennis Blomquist, President Scottsdale, Arizona 2 REXFORD, INC. INFORMATION STATEMENT This Information Statement is furnished to the shareholders of the Company in connection with a Special Meeting to be held on May 3, 1999, at 10:00 a.m., Mountain Time, at 3090 East 3300 South, Suite 400, Salt Lake City, Utah 84109, and at any adjournment(s) thereof. At the Special Meeting, the shareholders will consider and vote on the Acquisition Proposal and ratify and approve the Agreement and Plan of Reorganization entered into between the Company and Chicago Map Corporation ("CMC") that provides for: (A) the implementation of a 1-for-70 reverse split of all of the Company's issued and outstanding shares of common stock; (B) the issuance of 10,500,000 shares of the Company's post-reverse split common stock to the CMC shareholders in exchange for all of the CMC common stock; (C) changing the name of the Company to "Lexon Technologies, Inc."; and (D) electing Steven J. Peskaitis, Mike Barnett, Paris Karahalios, and Thomas W. Rieck, all nominees of CMC, as directors of the Company, to serve until the next annual meeting of shareholders and until their successors are duly elected and qualified. Approval of the Acquisition Proposal by the shareholders will constitute approval of each of the foregoing. At the Special Meeting the Shareholders will also transact such other business as may properly come before the Special Meeting or any adjournment thereof. MANAGEMENT IS NOT ASKING FOR A PROXY AND YOU ARE REQUESTED NOT TO SEND US A PROXY, HOWEVER SHAREHOLDERS MAY BE PRESENT AT THE SPECIAL MEETING AND VOTE THEIR SHARES IN PERSON OR BY PROXY. MANAGEMENT ENCOURAGE ALL SHAREHOLDERS TO ATTEND THE SPECIAL MEETING IN PERSON. THIS INFORMATION STATEMENT IS BEING MAILED ON OR ABOUT APRIL 23, 1999 TO ALL SHAREHOLDERS ENTITLED TO VOTE AT THE SPECIAL MEETING. Only holders of record of the 70,000,000 shares of Common Stock of the Company outstanding as of March 26, 1999 (the "Record Date"), are entitled to vote at the Special Meeting. Each shareholder has the right to one vote for each share of the Company's common stock owned. Cumulative voting is not provided for. Holders of more than 50% of the 70,000,000 shares issued and outstanding must be represented at the Special Meeting to constitute a quorum for conducting business. Approval of the proposals discussed above requires the affirmative vote of a majority of the Company's issued and outstanding shares of Common Stock. The Company's officers, directors, and principal shareholders owning or controlling, in the aggregate, greater than 50% of the issued and outstanding shares of Common Stock on the Record Date have indicated their intention to vote in favor of the Acquisition Proposal. Accordingly, the Acquisition Proposal will be approved without the affirmative vote of any other shares. 3 THE ACQUISITION PROPOSAL: APPROVAL OF THE AGREEMENT AND PLAN OF REORGANIZATION Terms of the Acquisition - ------------------------ On March 26, 1999, the Company and CMC entered into an Agreement and Plan of Reorganization, a copy of which is attached as Exhibit A to this Information Statement (the "Acquisition Agreement"). The following discussion regarding the terms of the Acquisition Agreement is subject to, and qualified in its entirety by, the detailed provisions of the Acquisition Agreement and the any exhibits thereto. The Acquisition Agreement provides that the 15,000 shares of CMC Common Stock held by the CMC Shareholders will be exchanged for 10,500,000 shares of the Company's Common Stock. No fractional shares will be issued to the CMC Shareholders and the Company will round the number of shares of the Company's Common Stock to be issued to such stockholder to the nearest whole share. As a condition to the Acquisition Agreement, the Company will effect a 1- for-70 reverse stock split (the "Reverse Split") of the Company's Common Stock, so that shareholders of the Company prior to such Reverse Split will receive 1 share of the Company's Common Stock for each 70 shares of Common Stock held on the Record Date for the Reverse Split, rounded downward to the nearest whole share. This Reverse Split would reduce the Company's issued and outstanding stock from 70,000,000 to 1,000,000 shares. After giving effect to the Reverse Split and the issuance of 10,500,000 shares of Common Stock issued to the CMC Shareholders in exchange for the 15,000 of CMC Common Stock, the Company will have 11,500,000 shares issued and outstanding. The Reverse Split will not change the par value or authorized capitalization of the Company. The rights of existing shareholders will not be altered and no shareholders will be eliminated as a result of the Reverse Split. The Reverse Split will have no effect on the stockholders' equity of the Company, other than the transfer of approximately $56,106 in stated capital to additional paid-in capital. If, as a result of implementation of the Reverse Split, any shareholder would be entitled to receive a fractional share, the Company will not issue any fractional shares. Instead, shares will be rounded downward to the nearest whole number. All shares turned in to the Company as a result of the Reverse Split will be canceled and returned to the status of authorized but unissued shares. Therefore, after the Reverse Split is implemented, the Company will still have an authorized capitalization of 100,000,000 shares of Common Stock, of which 1,000,000 shares will be issued and outstanding and after giving effect to the issuance of 10,500,000 shares under the terms of the Acquisition Agreement, 11,500,000 shares will be issued and outstanding. Following the implementation of the Reverse Split and approval of the Acquisition Proposal, each holder of shares of the Company's Common Stock shall, upon the surrender of the certificate or certificates representing such shares to the Company's registrar and transfer agent, be entitled to receive a certificate or certificates evidencing shares of the Company's Common Stock, reflecting the new shares and name change of the Company. 4 As a condition precedent to the consummation of the transactions contemplated by the Acquisition Agreement, the shareholders of the Company are to adopt and approve all required or necessary resolutions to adopt an amendment to the Company's certificate of incorporation that provides for changing the name of the Company to "Lexon Technologies, Inc," and elect Steven J. Peskaitis, Mike Barnett, Paris Karahalios, and Thomas W. Rieck, the nominees of CMC to the Company's Board of Directors, to replace the Company's current Board of Directors. As soon as practicable following approval of the Acquisition Proposal by the Company's shareholders, a Certificate of Amendment and such other documents as are required by the provisions of the corporate statutes of the states of Delaware and Illinois to complete the acquisition of CMC are to be filed with the Secretary of State of States of the state of Delaware and Illinois. The "Effective Date" of the acquisition shall be the date the filing of such documents shall become effective. A. Name Change ----------- In connection with the acquisition of CMC, the Company desires to change the name of the Company to Lexon Technologies, Inc. or such derivation thereof, as may be acceptable to the Board of Directors and available for use in the state of Delaware and the jurisdictions in which the activities of the Company would require the Company to qualify to do business in those jurisdictions. Management of the Company believes that the new name will be more reflective of the Company's diverse activities following the acquisition. B. Election of Board of Directors ------------------------------ The names of the Company's current executive officers and directors and the positions held by each of them are set forth below: Position with Director and/or Name Age the Company Officer Since - -------------------- --- --------------------- ------------------ Dennis Blomquist 47 President and Chairman 1992 Ron Featherstone 48 Vice President and Director 1992 Mark A. Scharmann 40 Treasurer and Director 1992 Tom Sollami 48 Secretary and Director 1992 The Company's officers and directors have served in such positions since the dates indicated above. Such persons will not stand for re-election at the Special Meeting. In connection with the proposed acquisition of CMC, Steven J. Peskaitis, Mike Barnett, Paris Karahalios, and Thomas W. Rieck, the nominees of CMC, have been nominated for election as directors of the Company. Certain biographical information with respect to each of such persons is set forth herein below. Each director, if elected by the shareholders, will serve until the next annual meeting and until his successor is duly elected and qualified. Set forth on the following page is certain information relating to the business experience of each of CMC's nominees for directors of the Company for the past five years. 5 Steven J. Peskaitis, age 24, is a co-founder of CMC and has been its President since its inception in 1990. Mr. Peskaitis has been influential in all phases of the Company's operations. Mike Barnett, age 41, has served as the director of corporate licensing for CMC since 1996. From 1994 through 1996, Mr. Barnett was the director of sales and marketing from American Technologies, Fond du Lac, Wisconsin, a manufacturer of software for satellite communications and vehicle monitoring products for the over-the-road trucking market. Mr. Barnett received a B.S. in Management from Oregon State University, Salem, Oregon in _____. Paris Karahalios, age 44, is a co-founder of TRIUS, Inc. and has served and the president and C.E.O. since its inception in August 1990. TRIUS, Inc., located in North Andover, Massachusetts, is a developer of mapping technology. CMC acquired the assets of TRIUS, Inc. in March 1999. Mr. Karahalios was a M.S. in Nuclear Engineering/Fusion and a B.S. in Nuclear Engineering from the University of Lowell, Lowell, Massachusetts, in 1977 and 1981, respectively, and has been published in various software and scientific magazines. Thomas W. Rieck, age 53, has since 1980 been the president of the law firm Rieck and Crotty, P.C., Chicago, Illinois, legal counsel to CMC. Since 1992, Mr. Rieck has served as a board member of SigmaTron International, Inc. (NASDAQ: SGMA), Elk Grove Village, Illinois, a electronics contract assembly manufacturer. Since 1987, Mr. Rieck has served as a board member for Circuit Systems, Inc. (NASDAQ: CSYI), Elk Grove Village, Illinois, a manufacturer of printed circuit boards. Mr. Rieck is a member of both the Chicago and American Bar Associations. Set forth below is biographical information on each of the current directors of the Company. Dennis Blomquist has served as an officer and director of the Company since 1992. For the past five years, Mr. Blomquist has been a self-employed business consultant providing data base administration, development and computer related services. From June 1996 to December 1997, Mr. Blomquist worked for Parami Productions, Inc., Studio City, California, a film and television development company as director of development. Ron A. Featherstone has served as an officer and director of the Company since 1992. Since July 1995, Mr. Featherstone has been the executive vice president for Investors First Ventures, Ltd, Scottsdale, Arizona, a financial consulting firm. From 1993 through June 1995, Mr. Featherstone was the area sales manager for Clarke Publications, Irwindale, California. Tom Sollami has served as an officer and director of the Company since 1992. Mr. Sollami has been employed as the Security Coordinator of the Doubletree Hotel, Salt Lake City, Utah, since February 1998. Mark A. Scharmann has been vice-president and a director of the Company since February 1997. Since 1979, Mr. Scharmann has been the principal owner of Troika Capital, Inc., Ogden, Utah, a financial consulting company. 6 Recommendation of Management - ---------------------------- THE BOARD OF DIRECTORS OF THE COMPANY BELIEVES THAT THE TRANSACTIONS CONTEMPLATED BY THE ACQUISITION AGREEMENT ARE DESIRABLE AND IN THE BEST INTERESTS OF THE COMPANY'S SHAREHOLDERS AND UNANIMOUSLY RECOMMENDS THAT THE SHAREHOLDERS VOTE "FOR" THE ACQUISITION PROPOSAL. MANAGEMENT BELIEVES THAT ITS SHAREHOLDERS WILL BENEFIT THROUGH THE STRENGTH, EXPERIENCE AND KNOWLEDGE OF CMC'S SENIOR EXECUTIVE MANAGEMENT IN THE ONGOING DEVELOPMENT OF THE BUSINESS OF THE COMPANY. (SEE "BUSINESS OF CMC.") CMC's management has presented the Company's management with a business plan that is focused on emerging opportunities in the business of designing, developing, producing, licensing and marketing geographical digital map technology, including Global Positioning System (GPS) products and navigation systems, Web/Intranet/Internet map displays, digital data integration and referencing, country-wide digital map sets, professional software and mobile asset monitoring/tracking systems. CMC's management intends to aggressively pursue its current business strategy and therefore the Company's shareholders may be able to benefit from any related increased market activity in the Company's Common Stock. There are, however, no assurances that CMC's management will be able to conduct profitable operations or that the Company's shareholders will benefit from increased market activity in the Company's Common Stock. The Board of Directors of the Company has not obtained an independent opinion or other evaluation regarding the fairness of the terms of the Agreement due to the substantial costs in obtaining such an opinion or evaluation. Accounting Treatment - -------------------- The proposed acquisition of CMC by the Company will be accounted for as a recapitalization of CMC because the shareholders of CMC will control the Company after the acquisition. Therefore, CMC will be treated as the acquiring entity. There will be no adjustment to the carrying value of the assets or liabilities of CMC in the share exchange. The Company will be the acquiring entity for legal purposes and CMC will be the surviving entity for accounting purposes. No Legal Opinions or Tax Rulings - -------------------------------- The proposed acquisition of CMC by the Company is intended to qualify as a tax-free reorganization under the Internal Revenue Code of 1986. If the acquisition qualifies as a tax-free reorganization, no gain or loss will be recognized for income tax purposes by either the Company or CMC as a result of the acquisition. However, neither the Company nor CMC has requested a tax ruling from the Internal Revenue Service or an opinion of legal counsel with respect to the acquisition. Accordingly, no assurance can be given that the acquisition will qualify as a tax-free reorganization. The shares of the Company's Common Stock to be issued to the CMC shareholders will not be registered under the Securities Act of 1933, as amended (the "Act") in reliance on the exemptions from such registration requirements provided by Sections 3(b) and 4(2) of the Act for certain small offerings and for transactions not involving any public offering. In order to claim the availability of such exemptions, the CMC shareholders will be required to make representations to the Company with respect to their 7 acquisition of the Company's shares, such shares will be restricted securities, and the certificates will bear legends restricting their subsequent resale in the absence of registration under the Securities Act or the availability of an exemption therefrom. Vote Required - ------------- The vote of a majority of the issued and outstanding shares of Common Stock represented in person or by proxy at the Special Meeting is required to approve the Acquisition Proposal. Members of management and other principal shareholders holding or controlling the vote of in excess of fifty percent (50%) of the issued and outstanding stock entitled to vote at the Special Meeting have indicated their intention to vote in favor of the Acquisition Proposal. THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT YOU VOTE "FOR" THE AQUISITION PROPOSAL. Business of the Company - ----------------------- The Company was incorporated on February 14, 1983, in the state of Utah under the name Chelsea Energy Corporation (hereinafter the "Registrant" or the "Company"). In connection with its formation, a total of 1,047,000 shares of its common stock were issued to the founders of the Company. In March 1985, the Company sold 3,000,000 shares of its common stock in connection with a public offering at a price of $0.01 per share. The public offering was registered with the Utah Securities Division pursuant to Section 61-1-10, Utah Code Annotated, as amended. The offering was exempt from federal registration pursuant to Regulation D, Rule 504, promulgated under the Securities Act of 1933, as amended. The Company was initially formed to provide professional consulting services to local government units. In April 1989, the Company formed California Cola Distributing Company, Inc. ("CCDCI")under the laws of the state of Delaware as a wholly-owned subsidiary. In May 1989, the Company merged into its subsidiary, CCDCI, in connection with a reincorporation merger. As a result of the reincorporation merger, the Company changed its domicile to the state of Delaware from the state of Utah and changed its name from Chelsea Energy Corporation to California Cola Distributing Company, Inc. In October 1992, the Company effected a sale of its wholly-owned subsidiary, CCDCI to California Cola Group Incorporated, a principal shareholder of the Company and changed the its name to Rexford, Inc. Current Business Activities - ---------------------------- Since divesting itself of CCDCI, the Company has had no operations and has been seeking potential business acquisitions or opportunities in an effort to commence business operations. The Acquisition Proposal now being presented to the Company's shareholders has been evaluated by the Company as a viable business opportunity based on management's business judgment. Because of the Company's current status having no assets and no recent operating history, the Company has voluntarily filed a registration statement on Form 10SB with the U.S. Securities and Exchange Commission in order to make information concerning itself more readily available to the public. The Company is obligated to file with the Commission certain interim and periodic reports including an annual report containing audited financial statements. 8 The Company is considered a development stage company with no assets or capital and with no operations or income since approximately 1992. The costs and expenses associated with the preparation and filing of this information statement and other operations of the Company have been paid for by shareholders of the Company, specifically Mark A. Scharmann (see Security Ownership of Certain Beneficial Owners and Management). The Company has not received a formal commitment from its shareholders and officers or directors to continue to finance the Company's expenses and unless the Acquisition Proposal is approved or the Company is able to obtain significant outside financing, there is substantial doubt about the Company's ability to continue as a going concern. Selected Financial Data of the Company - -------------------------------------- The year end financial data included in the table has been selected by the Company and has been derived from the Company's financial statements included in the Company's Annual Report on Form 10KSB for its fiscal year ended September 30, 1998. All financial information for the fiscal years ended September 30, 1998 and 1997 have been examined by Tanner + Co., certified public accountants. The three-month unaudited financial data has been derived from the Company's financial statements included in the Company's Quarterly Report on Form 10QSB for the period ended December 31, 1998 and has been provided by the Company. Three Months Ended December 31, Year Ended September 30, 1998 1998 1997 (Unaudited) ---- ---- --------- Statement of Operations Data: Revenues $ - $ - $ - Cost of Sales $ - $ - $ - Operating Expenses $ 46,350 $ 42,795 $ 6,606 Net (loss) $ (46,350) $ (42,795) $ (6,606) Net (loss) per common share $ (0.00) $ (0.01) $ (0.00) Weighted Average Shares Outstanding 43,767,000 16,360,000 57,106,420 At December 31, Year Ended September 30, 1998 1998 1997 (Unaudited) ---- ---- --------- Balance Sheet Data: Current Assets $ 226 $ 540 $ - Current Liabilities $ 11,056 $ 590 $ 17,436 Work Capital(Deficit) $ (10,830) $ (50) $ (17,436) Property & Equipment (net) $ - $ - $ - Total Assets $ 226 $ 540 $ - Long Term Liabilities $ - $ - $ - Shareholders' Equity (Deficit)$ (10,830) $ (50) $ (17,436) 9 Business of CMC - --------------- All information with respect to CMC's business activities has been provided by the management of CMC and is presented herein without independent verification. CMC has represented that the information is accurate and complete in all material respects. Financial information regarding CMC has been provided in this Information Statement in the section titled "Selected Financial Data" below. CMC was incorporated in July 1992 in the state of Illinois under the name S&S Publishing, Inc. In March 1994, an amendment was filed to change its name to Just Softworks, Inc. In July 1995, another amendment was filed to change its name to Chicago Map Corporation. CMC's core competency is the development, production, licensing and marketing of geographical digital map technology. Use of these technologies are found in products and services such as; consumer-oriented mapping products, GPS (Global Positioning System) navigation systems, Web/Internet/Intranet map displays, digital data integration and referencing, country-wide digital map sets, professional software development, and mobile asset monitoring/tracking. These application solutions operate in various Windows(TM) environments, allowing customers to apply and utilize CMC technologies across a broad range of markets and throughout various countries. CMC's versatile mapping technologies make use of numerous detailed and comprehensive geographical databases that include street addresses, road networks, highways, major geographical landmarks, hydrographic features, topographical relief tables and satellite/aerial photography. These full featured displays are complete, flexible and comprehensive enough to meet the mapping needs of individual, corporate, and government users and essentially eliminate the need for standard paper maps. Historically, CMC's primary focus has been on the creation of a base line of technologies that can be easily and cost-effectively integrated within a wide range of applications. This allows CMC and its professional staff to directly and indirectly support the development of custom mapping software designed around a base framework of quality data and integration tools. This design model works efficiently for both limited distribution and large volumes. CMC takes advantage of modern programming languages and simplifies and speeds system development via its own proprietary tools, class libraries and professional support. Strategic Plan - -------------- Mapping is the representation of the Earth's surface drawn to scale. The history of mapping can be traced to the beginning of time and have long aided in the exploration, discovery and understanding of the world in which we live. The process of creating maps is known as Cartography. Cartography is considered both a science and an art. Intertwined with geography, it is intended to present images of our communities, nation or the world. This effort, especially in its infancy, required the creative adaptation of roads, town labeling and landmarks to better aid in referencing these man-made or geographic points of interest. However, the complex and technically oriented world in which business, government and people now operate, has all but eliminated the artistic contribution. 10 Today's cartographic community is made up primarily of data gathers and surveyors using sophisticated equipment; such as satellite-aided instruments and computers to map their world. Paper maps are being replaced with or are being generated by advanced software programs. This shift in technology has allowed companies with database manipulation and software expertise, such as CMC, to step forward and help influence and lead this shift in cartography. CMC and its partners continue to maintain a solid background in map software development, CAD (computer aided drafting), GPS transportation movement monitoring and wireless communications. These disciplines have resulted in the creation of a broad range of product and service solutions necessary for the shifting and emerging markets, which demand absolute precision and accuracy in their maps. Products - -------- CMC offers the following categories of products: PROFESSIONAL DEVELOPMENT TOOLS - CMC has created a range of countrywide and worldwide development tools. These tools allow software programmers to integrate quality map displays into third-party applications. The map-imaging tool can represent a significant portion of the application or an isolated feature. Prior to any internal or external distribution of customized applications, a company must first establish a distribution licensing arrangement with CMC. The following products are marketed as part of the CMC's Professional Development Tool product line: MapOCX (USA): Full-featured map display tool that includes a detailed street- level map database of the entire United States. MapOCX Pro (USA): Advanced development tools that include a detailed street- level map database of the entire United States. Capabilities of the MapOCX (USA) are also accessible within the Pro product. MapOCX (Canada): Integration of street-level map data for all of Canada within an independent development tool. First software effort to market a national map database and display engine into the Canadian market. MapOCX (South Africa): Integration of street-level map data for select major metropolitan cities and major road networks of South Africa. First development tool released into the South African market that includes detailed map data and display engine. MapOCX (World): Low resolution map display of the entire world. Data includes country-level highway networks, population centers, political boundaries and much more. Raster image integration provides enhanced detailing. MapOCX (Geocoder - USA): CMC provides a tool to accurately assign X,Y coordinates to geographically reference US data sets. Referencing is based on existing postal routes. TECHNOLOGY LICENSING - CMC actively licenses its technologies and map display engines throughout the world. This wide spread distribution of applications and development tools has allowed CMC to achieve market dominance in many key markets. Research has shown that the current number of active accounts represents a very small portion of the overall market opportunity. Most of this opportunity remains uncommitted due to a lack of awareness within the marketplace. 11 PROGRAMMING AND CUSTOMER DEVELOPMENT SERVICES - These services include: CUSTOM PROGRAMMING: CMC provides programming services for creating, customizing and altering software applications. Programming languages include all major Windows(TM) visual development languages. Specialization includes GPS, wireless communication, geocoding, fleet tracking and other transportation and geographical referencing applications. TECHNICAL CONSULTING: Assisting companies in the design and development phase of third-party applications. Often, companies find that they lack some of the background and knowledge base requirements demanded in geographic map development. Involvement is limited by the needs of the customer. TECHNICAL WRITING: CMC participates in a variety of technical writing tasks. These tasks include Help files creation and the drafting of programming specifications. GOVERNMENT CONTRACTS - CMC was recently awarded a key development project with the United States Geological Survey (USGS). Acquiring this contract will allow CMC to influence the distribution and availability of existing and future government collected geographic data. This effort has been reborn after years of inactivity, and is poised to leverage new technologies into one of the greatest data transfers involving the US government. The National Atlas of the United States of America: The primary purpose of this effort is to design, develop, distribute and maintain a new version of The National Atlas of the United States of America(TM) for the American people. New technologies make it possible to broaden the scope and coverage of the National Atlas as a major reference resource for the American people. By extending the National Atlas beyond that of static print publication, CMC envisions interactive multi-media, multi-formatted electronic platform for the use and integration of Government data. This allows access to the vast library of geo-referenced data sources to be contained within the same application. CMC's participation in the National Atlas program is intended to result in the creation of products and services that can and will be marketed by CMC and its licensees, to both the private and public sector. Design of these products will be based principally upon market research looking into the interests and desires of the buying sector. The future opportunity and potential of this project is both difficult and challenging to fully define at this point. It is without question that with proper and well-conceived planning this project will certainly extend beyond the limits of a single retail CD-ROM application or any single Web-site. INTERNATIONAL MAP DATA - CMC has determined that there is an untapped demand for international digital maps and that there are few companies that offer adequate solutions. CMC will continue to obtain key licenses to resell or license countrywide data for countries where adequate market opportunity exists. The following countries have been identified for expansion in the next twelve months: Canada Mexico (Under development) South Africa (Under development) North America (Under development) South America Western Europe World data (Under development) 12 CONSUMER RETAIL - Historically, CMC has been actively involved in the distribution of its map technology to the Consumer Retail market. Products have been sold through software distribution channels to major software retailers. Over the past few years, additional distribution has included direct and mail-order sales. CMC will continue to pursue these distribution efforts in addition to the newly developing E (electronic)-commerce over the Internet. CMC will develop products to satisfy the demands for quality map products. Current products distributed by CMC include: Precision Mapping Streets: This is the first mass-market product developed by CMC. It includes features that allow the user to locate specific locations on the map, create custom images and print an endless variety of maps. Precision Mapping Traveler: Integrating CMC's new routing technology, this software will help anyone in getting between any two points within the US. Additional features make it possible to interface GPS data showing the user's current location. Create and maintain a detailed database of destinations and beginning points. Precision Mapping Quick-Finder: Distributed through a number of strategic licensing relations, Quick-Finder is the most widely distributed mapping application in the US. It is a simplified version of the Precision Mapping Streets program. Precision Mapping Quick-Router: Similar to the Quick-Finder, Quick-Router is a budget software program. Using CMC's routing technology, the program will quickly generate a series of routes between any two US cities. PROFESSIONAL RETAIL - Products within this category are considered advanced mapping applications designed for specific markets or industries. At this time only one product falls within this product line. Others are under consideration at this time. LAND ANALYSIS: A multi-layered application designed for the real estate industry. It allows anyone involved in the sale, lease or transfer of property or land to determine key conditions that may negatively impact future values. These include floodwater determination, topographic relief, toxic waste sites, road locations and more. INTERNET MAPPING - With the rapid growth and expansion of the Internet, CMC has taken major efforts to develop a mapping product line specifically for the Web. The products listed below represent a sampling of current applications: MapMania: CMC's first effort in developing a Web-based mapping application. Used by companies to help guide customers to key locations or for searching addresses and cities throughout the US. Based on CMC's US data set, nothing has been sacrificed to ensure quality images. Internet MapOCX (USA): CMC has recently created a Web development tool specifically to meet the needs of programmers needing map images on their Web sites. This product includes a complete street-level database of the US. Internet MapOCX (Canada): Expanding its presence in Canada, CMC offers a Web development tool that includes a street-level database of the country. The application is used primarily on select Intranet sites at this time due to licensing restrictions. Internet MapOCX (World): A Web development tool for displaying worldwide geographic maps. Using the highest quality data available, the product is designed to interface third-party data with low-resolution country data. 13 Markets - ------- Computerized-mapping technologies can contain a limitless amount of geographic information and geographically referenced content. This facilitates and encourages the use of this electronic medium into a broad range of industries and markets. After carefully researching the broad demand for electronic mapping technology, CMC has positioned itself to service a variety of companies and organizations. Furthermore, considering the diverse nature of CMC's products and their utility when matched with generalized third-party data, CMC is well positioned to be influential in the US and numerous international marketplaces to meet this growing demand. At this time, CMC's technologies are being used across a wide variety of markets and industries including the following: Aerial/Satellite Imagery Consumer Retail Consumer Vehicle Tracking and Recovery Delivery Systems Demographic Analysis Direct Mail Emergency Response Entertainment Fleet Vehicle Tracking Flood Water Analysis Geo-Science Research Hazardous Waste Management Insurance Planning & Adjustments Integrated Phone Information Marine (Inland and Coastal Waterways) Marketing Analysis and Research Mobile Asset Management Motivational Marketing OEM GPS Manufacturers Oil and Gas Research In-Vehicle Navigation Pipeline Management Portable Navigation Devices Public Safety Presentation Maps Real Estate Property Analysis Surveying Telecommunications Thematic Mapping Topographic Determination Transportation Utility Management Weather Maps Web/Internet/Intranet Applications Although CMC has historically targeted the US marketplace, there is a significant shift to incorporate sales into other countries. The strategic licensing and acquisition of global and international data sets has enabled CMC to develop products that effectively support non-US mapping software markets. In 1997, approximately 99% of CMC's revenues were generated within the United States while the remaining 1% was generated in international markets. CMC is one of the few that are capable of integrating international map data sets and a map viewing engine that is appropriate for both consumer and professional products. Recent developments include a data set for the World, Canada, Mexico, South Africa and South America. These will continue to improve CMC's international presence and diversify its product and customer mix. Competition - ----------- CMC's products, services, and innovative map technologies are well received in the many markets it supports. The mapping industry recognizes the CMC's strong position as its clients, strategic partners, and competitors acknowledge their superior product capabilities, broad industry appeal, and solution-oriented focus. CMC delivers practical cost-effective results to fulfill its customer's varied needs. This is achieved through flexible (CMC provides custom programming services and applications), comprehensive (CMC 14 offers a variety of solutions for both broad range and vertical niches within the worldwide digital mapping industry) and cost-effective (CMC's products are appropriate for large quantity and limited distribution) products and services. For the past six years extensive development efforts have been put in place that now allow CMC to establish strategic relationships and release numerous products and services that can efficiently support a number of divergent and varied markets both within and outside of the US. At this time, CMC does not recognize any direct competitor that offers similar capabilities as those supported by CMC. Sales and Marketing - ------------------- CMC has developed an overall marketing strategy that has allowed CMC to carve out a solid niche for itself in the emerging map software industry. With a product line that ranges from various consumer software applications to professional development tools and beyond, the sales force is afforded numerous applications and options to offer each customer. It is typical for many customers to "grow" into a more advanced product. Initial introduction often begins with a basic retail application and later blossomed into customized applications adjusted to meet the specific needs of the customer. The retail, mail order and direct sales efforts by CMC have proven to be a positive way to educate companies and end user on the capabilities and quality of CMC's technologies. CMC has also promoted its products and corporate image through advertising in industry publications and attendance/exhibiting at numerous trade shows and seminars. CMC personnel are often sought after for appearance at industry specific events that require a well-proven knowledge of the market place. These strategies have resulted in numerous referrals and more business than CMC can handle with its existing staff. CMC's competitive position in the marketplace is well positioned due to flexibility in delivering cost-effective solutions and broad product offerings. As the sales cycle is a high-level process, a team is required to make sales presentations as needed when pursuing leads and referrals. The entire staff is, however, responsible for developing client contacts and maintaining CMC's excellent reputation. Customer Dependence - ------------------- Due to the nature of CMC's marketing practices and the diverse markets it serves, clients rarely represent a large percentage of CMC's sales on an ongoing basis. At this time no company or individual account represents more than 5% of annual sales. Patents, Copyrights and Trademarks - ---------------------------------- CMC owns or has properly filed for all of the necessary patents, copyrights and trademarks for its applications, development tools and proprietary map databases. Unlike most software development companies that use components created by third-party developers, CMC has chosen to create all necessary programming tools for its products. This eliminates any reliance on other companies for updates, maintenance as well as eliminating any licensing or royalty requirements. The only exception has been the licensing of map data used in the Canadian, South African and World Atlas products. These databases are licensed from well-established companies through long-term agreements, which are beneficial to CMC. 15 Selected Financial Data of CMC - ------------------------------ The year end financial data included in the table has been selected by CMC and has been derived from the CMC's balance sheets at December 31, 1998 and 1997 and statements of operations for its fiscal years ended December 31, 1998, 1997 and 1996. All financial information has been examined by Hutton Nelson & McDonald LLP, certified public accountants. Year Ended December 31, 1998 1997 1996 ---- ---- ---- Statement of Operations Data: Revenues $1,175,295 $1,934,433 $1,597,616 Cost of Sales $ 333,357 $ 890,586 $ 759,662 Operating Expenses $ 765,202 $1,081,036 $ 708,002 Net income(loss) $ 63,636 $ (38,116) $ 128,086 Net earnings (loss) per common share $ 6.36 $ (3.81) $ 12.81 Weighted Average Shares Outstanding 10,000 10,000 10,000 At December 31, 1998 1997 ---- ---- Balance Sheet Data: Current Assets $ 177,714 $ 188,679 Current Liabilities $ 13,471 $ 14,550 Work Capital $ 164,243 $ 174,138 Property & Equipment (net) $ 32,132 $ 51,705 Total Assets $ 264,696 $ 262,414 Long Term Liabilities $ - $ - Shareholders' Equity $ 251,225 $ 247,864 16 Market Price of the Company's Common Stock - ------------------------------------------ The following table sets forth, for the respective periods indicated, the prices of the Company's Common Stock in the over the counter market as reported by a market maker on the NASD'S OTC Bulletin Board. Such over the counter market quotations are based on inter-dealer bid prices, without markup, markdown or commission, and may not necessarily represent actual transactions. At April 9, 1999, the bid and ask quotations for the Company's Common Stock as quoted on the OTC Bulletin Board were $0.02 and $0.10 respectively. Bid Quotation ------------- Fiscal Year 1999 High Bid* Low Bid* - ---------------- -------- ------- Quarter ended 12/31/98 $0.10 $0.02 Quarter ended 3/31/99 $0.10 $0.02 Fiscal Year 1998 High Bid Low Bid - ---------------- -------- ------- Quarter ended 12/31/97 $ N/A $ N/A Quarter ended 3/31/98 $ N/A $ N/A Quarter ended 6/30/98 $ N/A $ N/A Quarter ended 9/30/98 $ N/A $ N/A Fiscal Year 1997 High Bid Low Bid - ---------------- -------- ------- Quarter ended 12/31/96 $ N/A $ N/A Quarter ended 3/31/97 $ N/A $ N/A Quarter ended 6/30/97 $ N/A $ N/A Quarter ended 9/30/97 $ N/A $ N/A To the best knowledge of management of the Company, prior to September 30, 1998, there was no reported bid or ask prices for the Company's Common Stock and there was no trading of the Company's Common Stock during is fiscal years ended September 30, 1998 and September 30, 1997. The number of shareholders of record of the Company's Common Stock as of March 26, 1999, was approximately 75. The Company has not paid any cash dividends to date and does not anticipate paying dividends in the foreseeable future. 17 Proforma Combined Financial Data - -------------------------------- REXFORD, INC. PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET DECEMBER 31, 1998 (Unaudited)
PRO FORMA ADJUSTMENTS --------------------- HISTORICAL ACQUISITION(S) OTHER PRO FORMA ------------ ------------ ------------ ------------ ASSETS Current assets Cash $ - $ 71,526 $ (62,300)(c) $ 9,226 Accounts receivable - 98,175 98,175 Inventories - 8,013 8,013 ------------ ------------ ----------- ------------ Total Current Assets - 177,714 (62,300) 115,414 ------------ ----------- ------------ Property and equipment - 111,762 12,300 (c) 124,062 Accumulated depreciation - 79,625 879 (c) 80,504 ------------ ------------ ----------- ------------ - 32,137 11,421 43,558 ------------ ------------ ----------- ------------ Other assets - 54,845 48,546 (c) 103,391 ------------ ------------ ----------- ------------ Total Assets $ - $ 264,696 $ (2,333) $ 262,363 ============ ============ =========== ============ LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) Current Liabilities Bank overdraft $ 3,765 $ - $ - $ 3,765 Accounts payable 1,750 5,740 - 7,490 Accrued liabilities - 7,731 209,774 (b) 217,505 Advance from related party 11,921 - - 11,921 ------------ ------------ ----------- ------------ Total current liabilities 17,436 13,471 209,774 240,681 ------------ ------------ ----------- ------------ Stockholders' equity (deficit) Common Stock 57,106 (45,106) 500(c)(d) 11,500 Additional paid-in capital 130,821 84,724 - 215,545 Retained earnings (205,363) 212,607 (212,607)(b)(c) (205,363) ------------ ------------ ----------- ------------ Total stockholders' equity (deficit) (17,436) 251,225 (212,107) 21,682 ------------ ------------ ----------- ------------ Total liabilities and stockholders' equity (deficit) $ - $ 264,696 $ (2,333) $ 262,363 ============ ============ =========== ============ (a) To reflect the acquisition of all of the issued and outstanding shares of common stock of Chicago Map Corporation through an exchange of common stock subsequent to a 1 for 70 reverse stock split by Rexford, Inc. (b) To reflect the declaration by the board of directors of Chicago Map Corporation of a cash dividend of $209,774 on all outstanding shares of common stock as of January 4, 1999. (c) To reflect the purchase of certain assets of TRIUS, Inc. on March 12, 1999 for $62,300 in cash and the issuance of 2,198 shares of common stock of Chicago Map Corporation. (d) To reflect the issuance of 2,802 shares of common stock of Chicago Map Corporation in connection with stock bonus to an officer and an employee of the Company. /TABLE 18 REXFORD, INC. PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF INCOME (LOSS) YEAR ENDED SEPTEMBER 30, 1998 (Unaudited)
PRO FORMA ADJUSTMENTS --------------------- HISTORICAL ACQUISITION(S) OTHER PRO FORMA ------------ ------------ ------------ ------------ Sales $ - $ 1,175,295 $ - $ 1,175,295 Cost of sales - 333,357 - 333,357 ------------ ------------ ------------ ------------ Gross profit - 841,938 - 841,938 Administrative expense 46,350 765,202 2,833(b)(c) 814,385 ------------ ------------ ------------ ------------ Income (loss) from operations (46,350) 76,736 (2,833) 27,553 Other expense Loss on disposition of assets - (13,100) - (13,100) ------------ ------------ ------------ ------------ Net income (loss) $ (46,350) $ 63,636 $ (2,833) $ 14,453 ============ ============ ============ ============ Average common shares outstanding 43,767,000 (32,267,000) - 11,500,000 ============ ============ ============ ============ Earnings (loss) per common share $ (0.00) $ 0.00 ============ ============ (a) To reflect the acquisition of all of the issued and outstanding shares of common stock of Chicago Map Corporation as if the transaction had been completed at the beginning of the period. (b) To reflect the depreciation and amortization in connection with the acquisition of certain assets of Tirus, Inc. by Chicago Map Corporation as if the transaction had been completed at the beginning of the period. (c) To reflect stock bonus to an officer and an employee of Chicago Map Corporation as if the transaction had been completed at the beginning of the period.
19 REXFORD, INC. PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF INCOME (LOSS) THREE MONTHS ENDED DECEMBER 31, 1998 (Unaudited)
PRO FORMA ADJUSTMENTS --------------------- HISTORICAL ACQUISITION(S) OTHER PRO FORMA ------------ ------------ ------------ ------------ Sales $ - $ 323,010 $ - $ 323,010 Cost of sales - 98,765 - 98,765 ------------ ------------ ------------ ------------ Gross profit - 224,245 - 224,245 Administrative expense 6,606 195,753 918(b)(c) 203,277 ------------ ------------ ------------ ------------ Net income (loss) $ (6,606) $ 28,492 $ (918) $ 20,968 ============ ============ ============ ============ Average common shares outstanding 43,767,000 (32,267,000) - 11,500,000 ============ ============ ============ ============ Earnings (loss) per common share $ (0.00) $ 0.00 ============ ============ (a) To reflect the acquisition of all of the issued and outstanding shares of common stock of Chicago Map Corporation as if the transaction had been commpleted at the beginning of the period. (b) To reflect the depreciation and amortization in connection with the acquisition of certain assets of Tirus, Inc. by Chicago Map Corporation as if the transaction had been completed at the beginning of the period. (c) To reflect stock bonus to an officer and an employee of Chicago Map Corporation as if the transaction had been completed at the beginning of the period.
The unaudited pro forma condensed consolidated financial statements have been prepared by management based upon assumptions deemed proper by it. The unaudited pro forma condensed consolidated financial statements presented above are shown for illustrative purposes only and are not necessarily indicative of the future financial position or future financial results of operations or of the financial position or results of operations that would have actually occurred had the transaction between the Company and CMC been in effect as of the date or for the periods presented. In addition, it should be noted that the Company's financial statements will reflect the acquisition only from the closing date of the acquisition. The unaudited pro forma condensed consolidated financial statements should be read in conjunction with the historical financial statements and related notes of the Company and Chicago Map Corporation. 20 EXECUTIVE COMPENSATION The Company has not had a bonus, profit sharing, or deferred compensation plan for the benefit of its employees, officers or directors. The Company has not paid any salaries or other compensation to its officers, directors or employees for the years ended September 30, 1998, 1997 and 1996, nor at any time during 1998, 1997 or 1996. Further, the Company has not entered into an employment agreement with any of its officers, directors or any other persons. As of the date hereof, no such persons have accrued any compensation from the Company. Summary Compensation Table - -------------------------- The following tables set forth certain summary information concerning the compensation paid or accrued for each of the Company's last three completed fiscal years to the Company's chief executive officer and each of its other executive officers that received compensation in excess of $100,000 during such period (as determined at September 30, 1998) the end of the Company's last completed fiscal year:
Long Term Compensation ---------------------- Annual Compensation Awards Payouts ------------------- ------ ------- Name and Principal Restricted Position Bonus Other Annual Stock Options/ LTIP All Other - ------------------ Year Salary ($) Compensation Awards SARs Payout Compensation ---- ------ ----- ------------ ---------- ------- ------ ------------ Dennis Blomquist, President & C.E.O. 1998 $-0- $-0- $ -0- $-0- $-0- $-0- $-0- 1997 $-0- $-0- $ -0- $-0- $-0- $-0- $-0- 1996 $-0- $-0- $ -0- $-0- $-0- $-0- $-0-
21 SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT The following table set forth as of March 26, 1999, the name and address and number of shares of the Company's Common Stock held of record or beneficially by each person who held of record, or was known by the Company to own beneficially, more than 5% of the 70,000,000 shares of Common Stock issued and outstanding, and the name and shareholdings of each director and of all officers and directors as a group. The table also indicates the number of shares and percent of class to be held following the acquisition by each person nominated for election as a director of the Company. All such persons are directors of CMC. Prior to Reorganization After Reorganization (2) ----------------------- ------------------------ Number of Percent Number of Percent Name and Address Shares (1) of Class Shares Owned of Class - ---------------- ------------ -------- -------------- -------- Principal Shareholders: Dennis Blomquist 9,644,212 13.78 137,774 1.20 777 East Main St. #210 Scottsdale, AZ 85251 Mark A. Scharmann 55,109,000 (3) 78.72 787,271 6.84 1661 Lakeview Circle Ogden, UT 84403 Current Officers and Directors: Dennis Blomquist --------See Table Above-------- Ron A. Featherstone 150,000 .21 2,143 .02 Mark A. Scharmann --------See Table Above-------- Tom Sollami 150,000 .21 2,143 .01 ---------- ----- ------- ---- All Officers and Directors as a Group (4 Persons) 65,053,212 92.93 929,331 8.08 ========== ===== ======= ==== Nominees of Election of Directors: Steven J. Peskaitis - - 7,235,970 62.92 Mike Barnett - - 448,700 3.90 Paris Karahalios - - 730,000 6.35 Thomas W. Rieck - - - - ---------- ----- ---------- ----- All Nominees for Election as a Group (4 Persons) - - 8,414,670 73.17 ========== ===== ========== ===== - -------------------------------- (1) All shares are owned directly or indirectly, beneficially and of record and the shareholder has sole voting, investment and dispositive power. (2) Gives effect to the 1-for-70 Reverse Split. (3) Includes 10,000 shares of Common Stock beneficially held of record by Troika Capital Investment, of which Mr. Scharmann is the principal owner and shareholder and 50,000 shares beneficially held of record by Rachel Leslie, the spouse of Mr. Scharmann, and which Mr. Scharmann disclaims beneficial ownership. 22 CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS Compliance with Section 16(a) of the Securities Exchange Act of 1934 - -------------------------------------------------------------------- The Company's Common Stock was recently registered pursuant to Section 12(g) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in connection therewith, directors, officers, and beneficial owners of more than 10% of the Company's Common Stock are required to file on a timely basis certain reports under Section 16 of the Exchange Act as to their beneficial ownership of the Company's Common Stock. The following table sets forth as of April 9, 1999, the name and position of each person that failed to file on a timely basis any reports required pursuant to Section 16 of the Exchange Act. Report to Name of Person Position be Filed - -------------- -------- ------------ None N/A N/A Shareholder Advances and Debt Conversion - ---------------------------------------- Mark A. Scharmann, an officer and director of the Company, has periodically advanced money to the Company during the years ended September 30, 1998 and 1997 and the six-month period ended December 31, 1998. Any outstanding advances made by Mr. Scharmann bear interest at a rate of 10% and have no maturity date. At September 30, 1997, the Company issued 23,024,015 shares of Common Stock, valued at approximately $0.002 per share, to Mark A. Scharmann, in exchange for the conversion of $46,048 of advances and accrued interest payable by the Company. On June 29, 1998, the Company issued an additional 17,785,406 shares of its Common Stock, valued at approximately $0.002 per share, to Mr. Scharmann, in exchange for the conversion of approximately $35,571 of advances and accrued interest payable by the Company. At December 31, 1998, the advances made by Mr. Scharmann totaled $11,921. Subsequent to September 30, 1998, the Company issued 12,893,580 shares of Common Stock to Mr. Scharmann in exchange for the conversion of all advances and accrued interest payable by the Company. The securities issued in the foregoing transactions were issued in reliance on the exemption from registration and the prospectus delivery requirements of the Securities Act of 1933, as amended (the "Securities Act"), set forth in section 3(b) and/or section 4(2) of the Securities Act and the regulations promulgated thereunder. The individual receiving the shares is an officer and director of the Registrant and is deemed to be an "accredited investor" as that term is defined under Rule 501 of the Regulation D of the Securities Act. 23 SHAREHOLDER PROPOSALS No proposals have been submitted by shareholders of the Company for consideration at the Special Meeting. It is anticipated that the next annual meeting of shareholders will be held during March 2000. Shareholders may present proposals for inclusion in the Information Statement to be mailed in connection with the next annual meeting of shareholders of the Company, provided such proposals are received by the Company no later than 90 days prior to such meeting, and are otherwise in compliance with applicable laws and regulations and the governing provisions of the articles of incorporation and bylaws of the Company. OTHER MATTERS Management does not know of any business other than referred to in the Notice which may be considered at the meeting. If any other matters should properly come before the Special Meeting, such matters will be properly addressed and resolved and those in attendance will vote on such matters in accordance with their best judgment. REXFORD, INC. By order of the Board of Directors /S/ Dennis Blomquist, President Salt Lake City, Utah April __, 1999 24 CHICAGO MAP CORPORATION REPORT ON EXAMINATION YEARS ENDED DECEMBER 31, 1998 AND 1997 25 Hutton Nelson & McDonald LLP Certified Public Accountants 1815 South Meyers Road Suite 550 Oakbrook Terrace, Illinois 60181-5230 630/495-5400 FAX 630/495-0561 INDEPENDENT AUDITORS' REPORT The Board of Directors Chicago Map Corporation We have audited the accompanying balance sheets of Chicago Map Corporation as of December 31, 1998 and 1997, and the related statements of income (loss), changes in shareholders' equity, and cash flows for each of the three years ended December 31, 1998. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statement based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Chicago Map Corporation as of December 31, 1998 and 1997, and the results of its operations and its cash flows for each of the three years ended December 31, 1998, in conformity with generally accepted accounting principles. /S/Hutton, Nelson & McDonald LLP Oakbrook Terrace, Illinois March 17, 1999 26 CHICAGO MAP CORPORATION BALANCE SHEETS ASSETS December 31, 1998 1997 ------- ------- Current assets Cash $ 71,526 $ 76,091 Accounts receivable, less allowance for doubtful accounts of $25,000 and $100,000 98,175 89,501 Inventories 8,013 19,287 Prepaid expenses - 3,800 ------ ------ Total current assets 177,714 188,679 ======= ======= Property and equipment Leasehold improvements 3,971 16,072 Furniture and equipment 107,791 102,604 ------- ------- Accumulated depreciation 32,137 51,705 ------ ------ Other asset Computer software costs, net of accumulated amortization of $16,343 in 1998 54,845 22,030 ------ ------ $264,696 $262,414 ======= ======= The accompanying notes are an integral part of these financial statements. 27 CHICAGO MAP CORPORATION BALANCE SHEETS (continued) LIABILITIES AND SHAREHOLDERS' EQUITY December 31, 1998 1997 ------- ------- Current liabilities Accounts payable $ 5,740 $ 2,123 Accrued liabilities Payroll taxes 7,731 11,500 Income taxes - 927 ----- ------ Total current liabilities 13,471 14,550 ------ ------ Shareholders' equity Common stock, no par value; authorized 100,000 shares; issued and outstanding 10,000 shares 1,000 1,000 Retained earnings 250,225 246,864 ------- ------- 251,225 247,864 ------- ------- $264,696 $262,414 ======= ======= The accompanying notes are an integral part of these financial statements. 28 CHICAGO MAP CORPORATION STATEMENTS OF INCOME (LOSS) Year Ended December 31 1998 1997 1996 --------- --------- --------- Sales $1,175,295 $1,934,433 $1,597,616 Cost of sales 333,357 890,586 759,662 --------- --------- --------- Gross profit 841,938 1,043,847 837,954 Administrative expense 765,202 1,081,036 708,002 ------- --------- ------- Income (loss) from operations 76,736 (37,189) 129,952 Other expense Interest Expense - - (138) Loss on disposition of assets (13,100) - - ------ ------ ------- Income (loss) before income taxes 63,636 (37,189) 129,814 Income taxes - 927 1,728 ------ ------ ------- Net income (loss) $ 63,636 $ (38,116) $ 128,086 ====== ====== ======= Average common shares outstanding 10,000 10,000 10,000 ====== ====== ====== Earnings (loss) per common share $ 6.36 $(3.81) $12.81 ====== ====== ====== The accompanying notes are an integral part of these financial statements. 29 CHICAGO MAP CORPORATION STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY Common Stock Retained Shares Amount Earnings ------ ------ -------- Balance, January 1, 1996 10,000 $1,000 $287,949 Net income 128,086 Cash distributions (68,635) ------ ----- ------- Balance, December 31, 1996 10,000 $1,000 347,400 Net income (38,116) Cash distributions (62,420) ------ ----- ------- Balance, December 31, 1997 10,000 $1,000 246,864 Net income 63,636 Cash distributions (60,275) ------ ----- ------- Balance, December 31, 1998 10,000 $1,000 $250,225 ====== ===== ======= The accompanying notes are an integral part of these financial statements. 30 CHICAGO MAP CORPORATION STATEMENTS OF CASH FLOWS Year Ended December 31 1998 1997 1996 --------- --------- --------- Cash flows from operating activities: Cash received from customers $1,141,761 $1,775,213 $1,748,237 Cash paid to suppliers and employees (1,028,544) (1,859,751) (1,389,739) Interest paid - - (138) Income taxes paid (927) (1,728) (2,613) --------- --------- --------- Net cash provided by (used in) operating activities 112,290 (86,266) 355,747 ------- ------ ------- Cash flows from investing activities: Proceeds from sale of equipment 425 - - Capital expenditures (7,847) (17,880) (47,958) Payment of computer software costs (49,158) (22,030) - ------ ------ ------ Net cash used in investing activities (56,580) (39,910) (47,958) ------ ------ ------ Cash flows from financing activities: Payments on loan from shareholder - - (6,827) Cash distributions paid to shareholders (60,275) (62,420) (68,635) ------ ------ ------ Net cash used in financing activities (60,275) (62,420) (75,462) ------ ------ ------ Net increase (decrease) in cash (4,565) (188,596) 232,327 Cash at beginning of year 76,091 264,687 32,360 ------ ------- ------- Cash at end of year $ 71,526 $ 76,091 $264,687 ====== ====== ======= The accompanying notes are an integral part of these financial statements. 31 CHICAGO MAP CORPORATION STATEMENTS OF CASH FLOWS (continued) Year Ended December 31 1998 1997 1996 --------- --------- --------- Reconciliation of net income (loss) to net cash provided by (used in) operating activities: Net income (loss) $ 63,636 $(38,116) $ 128,086 ------ ------ ------- Adjustment to reconcile net income (loss) to net cash provided by (used in) operating activities: Depreciation 13,890 13,222 5,893 Amortization of computer software costs 16,343 - - Amortization of organization costs - 17 25 Loss on disposition of assets 13,100 - - Change in assets (increase) decrease: Accounts receivable (8,674) (36,550) 281,423 Inventories 11,274 12,812 (7,638) Prepaid expenses 3,800 - (3,800) Changes in liabilities increase (decrease): Accounts payable 3,617 (38,732) (52,006) Accrued liabilities (4,696) 1,081 3,764 ------ ------ ------ Total adjustments 48,654 (48,150) 227,661 ------ ------ ------- Net cash provided by (used in) operating activities $112,290 $(86,266) $355,747 ======= ====== ======= The accompanying notes are an integral part of these financial statements. 32 CHICAGO MAP CORPORATION NOTES TO FINANCIAL STATEMENTS NATURE OF OPERATIONS The Company creates technologies and software tools which provide for the design and development of mapping and geographic products sold to customers located throughout the world. SUMMARY OF ACCOUNTING POLICIES Revenue Recognition - The Company records sales and related profits as product is shipped and services are rendered. Estimates - The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates. Inventories - Inventories are priced at the lower of cost, determined by the first-in, first-out method, or market. Property and Equipment - Property and equipment are recorded at cost. Expenditures for renewals and betterments which extend the life of such assets are capitalized. Maintenance and repairs are charged to expense as incurred. Differences between amounts received and net carrying value of assets retired or disposed of are charged or credited to income. Depreciation - Depreciation is charged to income using straight-line and accelerated methods based on the estimated useful lives of the assets. Computer Software Costs - Costs related to the purchase and development of computer software are amortized on a straight-line basis over twenty-four months. Amortization expense charged to income was $16,343 in 1998. No amortization was charged to income in 1997 and 1996. Income Taxes - The Company has elected S corporation status for income tax purposes. Under this election, the Company is not liable for federal income taxes, but is liable for certain state income and replacement taxes. Federal taxable income and tax credits flow through to the shareholders to be reported on their individual income tax returns. Earnings Per Common Share - Earnings (loss) per common share are computed by dividing net income (loss) by the weighted average number of common shares outstanding during the year. CASH During 1998 and 1997, the Company maintained an operating account with a bank which at times exceeded the federally insured limit of $100,000. The bank has a strong credit rating and management considers any risk to be minimal. 33 CHICAGO MAP CORPORATION NOTES TO FINANCIAL STATEMENTS (continued) DEPRECIATION Depreciation was charged to income, based on the estimated useful lives of the assets, in the following amounts: 1998 1997 1996 Estimated Life-Years ---- ---- ---- -------------------- Leasehold improvements $ 260 $ 428 $ 194 31-39 Furniture and equipment 13,630 12,794 5,699 5-7 ------ ------ ----- $13,890 $13,222 $ 5,893 ====== ====== ===== TRANSACTION WITH RELATED PARTY The Company leases office facilities on a month-to-month basis from a shareholder at a monthly rental of $3,000. Rent expense charged to income amounted to $36,000 in 1998, 1997 and 1996. SUBSEQUENT EVENTS On January 4, 1999, the Board of Directors declared a $240,000 cash distribution to the shareholders provided such amount does not exceed the Company's Accumulated Adjustment Account which is part of retained earnings as shown on the Balance Sheets. On March 12, 1999, the Company acquired certain assets of TRIUS, Inc. for $62,300 in cash and 2,198 shares of common stock of Chicago Map Corporation. The principal business of TRIUS, Inc. is the development of computer software technologies. In connection therewith, the Board of Directors approved a stock bonus of 2,802 shares to be issued to an officer and an employee of the Company. EX-2 2 ACQUISITION AGREEMENT 1 AGREEMENT AND PLAN OF REORGANIZATION This Agreement and Plan of Reorganization is entered into this 25th day of March 1999, by and between Rexford, Inc., a Delaware corporation ("Acquiror"); Chicago Map Corporation, an Illinois corporation ("Acquiree"); and the persons listed in Exhibit "A" attached hereto and by this reference made a part hereof, representing all of the stockholders of Acquiree ( "Stockholders"). RECITALS Stockholders own all of the issued and outstanding capital stock of Acquiree. Acquiror desires to acquire all of the issued and outstanding shares of capital stock of Acquiree, making Acquiree a wholly-owned subsidiary of Acquiror, and Stockholders desire to make a tax-free exchange of their shares in Acquiree solely for shares of Acquiror's common stock, $0.001 par value, as described herein. NOW, THEREFORE, for the mutual consideration set out herein and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties agree as follows: AGREEMENT 1. Plan of Reorganization. Stockholders of Acquiree are the owners of all of the issued and outstanding shares of capital stock of Acquiree. It is the intention of the parties hereto that all of the issued and outstanding shares of capital stock of Acquiree shall be acquired by Acquiror in exchange solely for Acquiror's voting common stock. It is the intention of the parties hereto that this transaction qualify as a tax-free reorganization under Section 368 (a) (1) (B) of the Internal Revenue Code of 1986, as amended, and related sections thereunder. 2. Exchange of Shares. Acquiror and Stockholders agree that all of the issued and outstanding shares of capital stock of Acquiree will consist, at the Closing Date, of 15,000 shares of common stock, will be exchanged with Acquiror for 10,500,000 shares of restricted common stock of Acquiror. As an integral part of the stock-for-stock exchange agreed to herein, Acquiror shall effect a 1 for 70 reverse split of its issued and outstanding shares of common stock. The 10,500,000 shares of Acquiror's common stock to be issued to Stockholders pursuant to this Agreement shall be issued subsequent to the date on which such 1 for 70 reverse split is effected and shall represent at least 68.8% of all issued and outstanding shares of Acquiror's common stock immediately following such split (and after giving effect to the private placement of a maximum of 1,709,231 shares of the Acquiror's common stock). The Acquiror shares will, on the Closing Date, as hereafter defined, be delivered to the Stockholders in exchange for their shares in Acquiree. Stockholders represent and warrant that they will hold such shares of common stock of Acquiror for investment purposes and not for further public distribution and agree that the shares shall be appropriately restricted. 3. Delivery of Shares. On or before the Closing Date, Stockholders will deliver certificates representing all of the issued and outstanding shares of Acquiree, duly endorsed so as to make Acquiror the sole holder thereof, free and clear of all claims and encumbrances. Such shares of Acquiree will be appropriately restricted as to transfer. On such Closing Date, delivery of the Acquiror shares, which will be appropriately restricted as to transfer, will be made to the Stockholders as set forth herein. The transaction contemplated herein shall not close unless all of the issued and outstanding shares of Acquiree are delivered at Closing and the owners thereof execute this Agreement. A list of shares of Acquiree, the owner thereof and 2 shares of Acquiror to be received by each Stockholder is attached hereto as Exhibit "A". Each Stockholder shall sign Exhibit "B", attached hereto and by this reference made a part hereof, evidencing his or her intent to be a party to this Agreement and bound hereby. 4. Termination. A. This Agreement may be terminated by action of the Board of Directors of Acquiror, or by the Stockholders of Acquiree at any time prior to the Closing Date if: (1) There shall be any actual or threatened action or proceeding by or before any court or any other governmental body which shall seek to restrain, prohibit, or invalidate the transactions contemplated by this Agreement and which, in the judgment of such Board of Directors made in good faith and based upon the advice of legal counsel, makes it inadvisable to proceed with the transactions contemplated by this Agreement; or (2) The Closing shall not have occurred prior to March 31, 1999, or such later date as shall have been approved by parties hereto, other than for reasons set forth in paragraph B or C below. In the event of termination pursuant to this Section 4 (A) , no obligation, right, or liability shall arise hereunder and each party shall bear all of the expenses incurred by them in connection with the negotiation, drafting, and execution of this Agreement and the consummation of the transactions herein contemplated. B. This Agreement may be terminated at any time prior to the Closing Date by action of Acquiror if: (1) Acquiree or the Stockholders shall fail to comply in any material respect with any of its or their covenants or agreements contained in this Agreement or if any of the representations or warranties of Acquiree or the Stockholders contained herein shall be inaccurate in any material respect; or (2) There shall have been any material change after December 31, 1998, in the assets, properties, business, or financial condition of Acquiree taken as a whole which could have a materially adverse effect on the value of the business of Acquiree except any changes disclosed in any exhibits or schedules attached hereto. In the event this Agreement is terminated pursuant to this Section 4 (B), this Agreement shall be of no further force or effect, no obligation, right, or liability shall arise hereunder, and Acquiree shall bear its own costs as well as the legal, accounting, printing, and other costs incurred by Acquiror in connection with the negotiation, preparation, and execution of this Agreement and the transactions herein contemplated. C. This Agreement may be terminated at any time prior to the Closing Date by action of the Board of Directors of Acquiree or by the Stockholders of Acquiree if: (1) Acquiror shall fail to comply in any material respect with any of its covenants or agreements contained in this Agreement or if any 3 of the representations or warranties of Acquiror contained herein shall be inaccurate in any material respect; or (2) There shall have been any material adverse change after December 31, 1998, in the assets, properties, business, or financial condition of Acquiror as a whole which could have a materially adverse effect on the value of the business of Acquiror taken as a whole except any changes disclosed in any exhibit or schedule attached hereto. In the event this Agreement is terminated pursuant to this Section 4 (C), this Agreement shall be of no further force or effect, no obligation, right, or liability shall arise hereunder, and Acquiror shall bear its own costs as well as the legal, accounting, printing, and other costs incurred by Acquiree and the Stockholders in connection with negotiation, preparation, and execution of this Agreement and the transactions herein contemplated. 5. Representations and Warranties of Stockholders and Acquiree. A. The Stockholders and Acquiree hereby represent and warrant that, effective this date and the Closing Date, the representations and warranties listed below are true and correct. (1) Stockholders of Acquiree. The Stockholders are the owners of all of the issued and outstanding shares of the capital stock of Acquiree; such shares are free from claims, liens, or other encumbrances; and Stockholders have the unqualified right to sell, transfer, and dispose of such shares subject to the laws of bankruptcy, insolvency, and general creditors' rights. Each Stockholder represents and warrants, that in regards to his or her shares of Acquiree, such Stockholder has the full right and authority to execute this Agreement and to transfer his or her shares of Acquiree to Acquiror. (2) Restricted Shares to be Issued. The Stockholders understand and are aware that the issuance of Acquiror's shares hereunder is being made without registration under the Securities Act of 1933, as amended (the "Act"), or any state securities laws and that the shares so issued may not be sold or transferred without registration under the Act and under applicable state, securities laws, or unless an exemption from such registration is available. The Stockholders understand that the investment in the shares of Acquiror is speculative and may remain so for an indefinite period and acknowledge that the Stockholders are able to bear the economic risk of their investment in the shares of Acquiror. All certificates evidencing Acquiror's common stock to be issued to Stockholders shall bear appropriate restrictive legends. B. The Principal Stockholders of Acquiree (defined for purposes of this Agreement as owners of 2% or more of Acquiree Shares) and Acquiree hereby represent and warrant that, effective this date and the Closing Date, the representations and warranties listed below are true and correct. (1) Corporate Authority. Acquiree has the full corporate power and authority to enter into this Agreement and (subject to any requisite approval by the holders of Acquiree common shares) to carry out the transactions contemplated by this Agreement. The Board of Directors of Acquiree has duly authorized the execution, delivery, and performance of this Agreement. (2) Financial Statements. (a) The audited balance sheet of Acquiree as of December 31, 1998 and 1997 and the related statements of income (loss), changes in 4 shareholders' equity and, cash flows, and stockholders' equity for the three years ended December 31, 1998, 1997 and 1996, including the notes thereto, and the accompanying report of Hutton Nelson & McDonald, LLP, certified public accountants, have been delivered to Acquiror ("Acquiree Financial Statements"). To the best knowledge of Acquiree and Principal Stockholders, except as set forth in Acquiree's Schedules, such financial statements contain all adjustments (all of which are normal recurring adjustments) necessary to present fairly the results of operations and financial position for the periods and as of the dates indicated. (b) The audited financial statements delivered pursuant to subparagraph (a) have been prepared in accordance with United States generally accepted accounting principles consistently applied throughout the periods involved and, when required to be audited, have been audited by a certified public accountants licensed to practice in the United States and before the Securities and Exchange Commission. The audited financial statements have been presented in accordance with the requirements of Regulation S-X promulgated by the SEC regarding the form and content of and requirements for financial statements to be filed with the SEC. The Acquiree Financial Statements present fairly, the financial position of Acquiree. Acquiree did not have, as of the date of the Acquiree Financial Statements, except as and to the extent reflected or reserved against therein, any liabilities or obligations (absolute or contingent) which should be reflected in any financial statements or the notes thereto prepared in accordance with generally accepted accounting principles, and all assets reflected therein present fairly the assets of Acquiree, in accordance with generally accepted accounting principles. The statements of revenue and expenses and cash flows present fairly the financial position and result of operations of Acquiree as of their respective dates and for the respective periods covered thereby. (c) The books and records, financial and otherwise, of Acquiree are in all material respects complete and correct and have been maintained in accordance with sound business and bookkeeping practices so as to accurately and fairly reflect, in reasonable detail, the transactions and dispositions of the assets of Acquiree. (d) Proper and accurate amounts of taxes have been withheld by or on behalf of Acquiree with respect to all material compensation paid to employees of Acquiree for all periods ending on or before the date hereof, and all deposits required with respect to compensation paid to such employees have been made, in complete 5 compliance with the provisions of all material accrual or material arrangement for or payment of bonuses or special compensation applicable under tax and other laws. There are no tax liens upon any of the assets of Acquiree. (3) Absence of Certain Changes or Events. Except as set forth in this Agreement or the Acquiree Schedules attached hereto, since December 31, 1998, the date of the Acquiree Financial Statements,: (a) There has not been (1) any material adverse change in the business, operations, properties, level of inventory, assets, or financial condition of Acquiree taken as a whole; or (2) any damage, destruction, or loss to Acquiree (whether or not covered by insurance) materially and adversely affecting the business, operations, properties, assets, or conditions of Acquiree; (b) Acquiree has not (1) amended its Articles of Incorporation or Bylaws; (2) declared or made, or agreed to declare to make, any payment of dividends or distributions of any assets of any kind whatsoever to Stockholders or purchased or redeemed, or agreed to purchase or redeem, any of their capital stock; (3) waived any rights of value which in the aggregate are extraordinary or material considering the business of Acquiree; (4) made any material change in its method of management, operation, or accounting; (5) entered into any other material transactions not in the ordinary course of business except as otherwise contemplated by this Agreement including, but not limited to, Acquiree's acquisition of certain assets of Trius, Inc. and the issuance of common stock of Acquiree related thereto; (6) made any accrual or arrangement for or payment of bonuses or special compensation of any kind or any severance or termination pay to any present or former officer or employee; (7) increased the rate of compensation payable or to become payable by it to any of its officers or directors or any of its employees whose monthly compensation exceeds $5,000; or (8) made any increase in any profit sharing, bonus, deferred compensation, insurance, pension, retirement, or other employee benefit plan, payment, or arrangement made to, for, or with its officers, directors, or employees; (c) Acquiree has not (1) granted or agreed to grant any options, warrants, or other rights for its stocks, bonds, or other corporate securities calling for the issuance thereof except as described in the Schedules attached hereto; (2) borrowed or agreed to borrow any funds or incurred, or become subject to, any material obligation or liability (absolute or contingent) except 6 liabilities incurred in the ordinary course of business; (3) paid any material obligation or liability (absolute or contingent) other than current liabilities reflected in or shown on the balance sheet contained in the Acquiree Financial Statement and current liabilities incurred since that date in the ordinary course of business; (4) sold or transferred, or agreed to sell or transfer, any of its assets, property, or rights (except assets, property, or rights held as inventory or canceled or agreed to cancel, any debts or claims (except debts or claims which in the aggregate are of a value of less than $25,000); (5) made or permitted any amendment or termination of any contract, agreement, or license to which it is a party if such amendment or termination is material, considering the business of Acquiree taken as a whole; or (6) issued, delivered, or agreed to issue or deliver any stock, bonds, or other corporate securities including debentures (whether authorized and unissued or held as treasury stock) except for the shares of common stock in Acquiree issued in connection with Acquiree's acquisition of certain assets of Trius, Inc.; and (d) To the best knowledge of Acquiree, it has not become subject to any law or regulation which materially and adversely affects, or in the future may adversely affect, its business, operations, properties, assets, or condition. (4) Litigation and Proceedings. Acquiree is not involved in any pending litigation or governmental investigation or proceeding not reflected in such financial statements, or otherwise disclosed in the Acquiree Schedules and, to the best knowledge of Acquiree and Principal Stockholders, no litigation, claims, assessments, or governmental investigation or proceeding is threatened against Acquiree, its Principal Stockholders, or properties. (5) Organization. (a) As of the Closing Date, Acquiree will be in good standing in its state of incorporation, and will be in good standing and duly qualified to do business in each state and jurisdiction where the failure to qualify would have a material adverse effect on Acquiree. (b) To the best knowledge of Acquiree and Principal Stockholders, Acquiree has complied with all state, federal, and local laws in connection with its formation, issuance of securities, capitalization, and operations, and no contingent liabilities have been threatened or claims made, and no basis for the same exists with respect to said operations, formation, or capitalization, including claims for violation of any state or federal securities laws except where any noncompliance would not materially 7 affect the business or property of the Acquiree. (6) Compliance with Laws, Rules and Regulations. Acquiree and Principal Stockholders represent and warrant that Acquiree complies with all applicable federal laws, rules and regulations; and all applicable State laws, rules and regulations relating to the operation of its business and the sale of Acquiree's products except to the extent that non- compliance would not materially and adversely affect the business, operations, properties, assets, or condition of Acquiree or except to the extent that non- compliance would not result in the incurrence of any material liability for Acquiree. (7) Tax Returns. Acquiree has filed all federal, state, county, and local income, excise, property, sales, and other tax returns, forms, or reports, which are due or required to be filed by it prior to the date hereof and have paid or made adequate provisions for the payment of all taxes, penalty fees, or assessments which have or may become due pursuant to such returns or pursuant to any assessments received. (8) Subsidiaries. Acquiree has no subsidiaries and does not own any capital stock, security, partnership interest, or other interest of any kind in any corporation, partnership, joint venture, association, or other entity. (9) No Conflict With Other Instruments. The execution of this Agreement will not violate or breach any document, instrument, agreement, contract, or commitment material to the business of Acquiree to which Acquiree or Principal Stockholders are a party and has been duly authorized by all appropriate and necessary action. (10) Capitalization. The authorized capital stock of Acquiree consists of 100,000 shares of common stock having no par value, of which 15,000 shares have been validly issued and are now outstanding, and of which 15,000 will be outstanding at the Closing Date. There are no outstanding convertible securities, warrants, options, or commitments of any nature which may cause authorized but unissued shares to be issued to any person, except as described in the schedules attached hereto. All issued and outstanding shares are legally issued, fully paid, and non-assessable, and are not issued in violation of the pre-emptive or other right of any person. (11) Title and Related Matters. Acquiree has good and marketable title to all of its licenses, copyrights, trademarks, trade secrets, patents, patents pending, properties, inventory, interests in properties, and other assets, real and personal, which are reflected in the Acquiree Financial Statements, or acquired after that date (except properties, interest in properties, and assets sold or otherwise disposed of since such date in the ordinary course of business), free and clear of all mortgages, liens, pledges, charges, or encumbrances except (i) statutory liens or claims not yet delinquent; (ii) such imperfections of title and easements as do not and will not materially detract from or interfere with the present or proposed use of the assets or properties subject thereto or affected thereby or otherwise materially impair present business operations on such properties or in connection with such assets; and (iii) as described in Acquiree Financial Statements or in the Acquiree Schedules. Acquiree owns, free and clear of any liens, claims, encumbrances, royalty interests, or other restrictions or limitations of any nature whatsoever, any and all procedures, techniques, business plans, methods of management, or other information utilized in the conduct of its business or operations, whether or not the value thereof is reflected in the most recent balance sheet included in the Acquiree Schedules. The assets and equipment of Acquiree that are necessary or used in the operations of its business are in good operating condition and repair, normal wear and tear excepted. 8 (12) Contracts. (a) Except as included or described in the Acquiree Schedules, there are no material contracts, agreements, franchises, license agreements, or other commitments to which Acquiree is a party or by which it or any of its properties or assets are bound. (b) Subject to the laws of bankruptcy, insolvency, general creditor's rights, and equitable principles, all contracts, agreements, franchises, license agreements, and other commitments to which Acquiree is a party or by which its properties or assets are bound and which are material to its operations taken as a whole, are valid and enforceable in all respects. (c) Acquiree is not a party to or bound by, and the assets of Acquiree are not subject to, any contract, agreement, other commitment or instrument; any charter or other corporate restriction; or any judgment, order, writ, injunction, or decree which materially and adversely affects, or in the future may (as far as Acquiree can now foresee), materially and adversely affect, the business, operations, properties, assets, or condition of Acquiree. (d) Except as included or described in the Acquiree Schedules or reflected in the most recent Acquiree Financial Statements, Acquiree is not a party to any oral or written (a) contract for employment of any officer or employee which is not terminable on 30 days (or less) notice; (b) profit sharing, bonus, deferred compensation, stock option, severance pay, pension benefit, or retirement plan, agreement, or arrangement covered by Title IV of the Employee Retirement Income Security Act, as amended; (c) agreement, contract, or indenture relating to the borrowing of money exceeding $50,000; (d) guaranty of any obligation, other than one on which Acquiree is a primary obligor, for the borrowing of money or otherwise, excluding endorsements made for collection and other guarantees of obligations, which, in the aggregate do not exceed $50,000; (e) consulting or other similar contract with an unexpired term of more than one year of providing for payment in excess of $50,000 in the aggregate; (f) collective bargaining agreement, (g) agreement with any present or former officer or director of Acquiree or its subsidiaries; or (h) contract, agreement, or other commitment involving payments by it of more than $50,000 in the aggregate. (13) Material Contract Defaults. To the best knowledge of Acquiree and Principal Stockholders, Acquiree is not in default in any material respect under the terms of any outstanding contract, agreement, lease, or other commitment which is material to the business, operations, properties, assets, or condition of Acquiree, and there is no event of default 9 or other event which, with notice or lapse of time or both, would constitute a default in any material respect under any such contract, agreement, lease, or other commitment in respect of which Acquiree has not taken adequate steps to prevent such a default from occurring. (14) Acquiree Schedules. Acquiree has delivered to Acquiror the following schedules which are collectively referred to as the "Acquiree Schedules" and which consist of separate schedules dated as of the date of execution of this Agreement and instruments and data as of such date, all certified by the chief executive officer of Acquiree and the Principal Stockholders, as complete, true, and correct: (a) A schedule containing complete and correct copies of the Articles of Incorporation and Bylaws of Acquiree in effect as of the date of this Agreement; (b) A schedule including the financial statements of Acquiree identified in paragraph 5(b) (2). (c) A schedule containing a complete and correct copy of the stock ledger of Acquiree; (d) A schedule containing a description of all real property owned or leased by Acquiree together with a description of every mortgage, deed of trust, pledge, lien, agreement, encumbrance, claim, or equity interest of any nature whatsoever in such real property with copies of the underlying documentation; (e) A schedule containing copies of all material contracts, promissory notes, profit sharing arrangements, options, warrants, employment agreements, licenses, agreements, or other instruments to which Acquiree is a party or by which it or its properties or assets are bound; (f) A schedule describing all governmental licenses, permits, and other governmental authorizations (or requests or applications therefor) pursuant to which Acquiree carries on or propose to carry on its business (except those which, in the aggregate, are immaterial to the present or proposed business of Acquiree; (g) A schedule setting forth a description of any material adverse change in the business, operations, property, inventory, assets, or condition of Acquiree since the date of the Acquiree Financial Statements; (h) A schedule of all litigation or governmental investigation or proceeding which is pending or which, to the best knowledge of management, is threatened or contemplated; (i) A schedule of all other documents, disclosures, or representations required to be disclosed by this Agreement or required to be disclosed in order to set forth all material facts regarding Acquiree. 10 (15) Information. The information concerning Acquiree set forth in this Agreement and in the Acquiree Schedules is complete and accurate in all material respects and does not contain any untrue statement of a material fact or omit to state a material fact required to make the statements made in light of the circumstances under which they were made not misleading. (16) Compliance With Blue Sky Laws. Acquiree shall prepare and caused to be filed, all required notices, forms, reports, filing fees and other documents in order to comply with all applicable blue sky law, rule or regulation in connection with the stock-for-stock exchange contemplated herein. Acquiror shall provide Acquiree such information and sign such documents as may be necessary to permit Acquiree to complete its obligations under this paragraph 16. 6. Representations and Warranties of Acquiror. Acquiror hereby represents and warrants that effective this date and the Closing Date, the following representations are true and correct: A. Issuance of Shares. As of the Closing Date, the Acquiror shares to be delivered to the Stockholders, will constitute valid and legally issued shares of Acquiror, fully-paid and non-assessable, and will be legally equivalent in all respects to the common stock of Acquiror issued and outstanding as of the date hereof. B. Authorization. The officers of Acquiror are duly authorized to execute this Agreement and have taken all action required by law and agreements, charters, Bylaws, etc., to properly and legally execute this Agreement. C. Financial Statements. (1) The audited balance sheets of Acquiror as of September 30, 1998 and 1997, and the related statements of operations, cash flows, and stockholders' equity for the years ended December 31, 1998 and 1997, and the cumulative amounts since October 1, 1992 (date of commencement of development stage), including the notes thereto, and the accompanying Independent Auditor's Report of Tanner + Co., have been delivered to Acquiror. Further, the unaudited balance sheet of Acquiror as of December 31, 1998, and the related statements of operations and cash flows for the three months ended December 31, 1998 and 1997 and the cumulative amounts from commencement of development stage, including the notes thereto ("Acquiror Financial Statements"). To the best knowledge of Acquiror, except as set forth in Acquiror's Schedules, such financial statements contain all adjustments (all of which are normal recurring adjustments) necessary to present fairly the results of operations and financial position for the periods and as of the dates indicated. (2) The audited financial statements delivered pursuant to subparagraph (1) have been prepared in accordance with United States generally accepted accounting principles consistently applied throughout the periods involved and, when required to be audited, have been audited by a certified public accountants licensed to practice in the United States and before the Securities and Exchange Commission. The audited financial statements have been presented in accordance with the requirements of Regulation S-X promulgated by the SEC regarding the 11 form and content of and requirements for financial statements to be filed with the SEC. The Acquiror Financial Statements present fairly the financial position of Acquiror. Acquiror did not have, as of the date of the Acquiror Financial Statements, except as and to the extent reflected or reserved against therein, any liabilities or obligations (absolute or contingent) which should be reflected in any financial statements or the notes thereto prepared in accordance with generally accepted accounting principles, and all assets reflected therein present fairly the assets of Acquiror, in accordance with generally accepted accounting principles. The statements of revenue and expenses and cash flows present fairly the financial position and result of operations of Acquiror as of their respective dates and for the respective periods covered thereby. (3) The books and records, financial and otherwise, of Acquiror are in all material respects complete and correct and have been maintained in accordance with sound business and bookkeeping practices so as to accurately and fairly reflect, in reasonable detail, the transactions and dispositions of the assets of Acquiror. (4) Proper and accurate amounts of taxes have been withheld by or on behalf of Acquiror with respect to all material compensation paid to employees of Acquiror for all periods ending on or before the date hereof, and all deposits required with respect to compensation paid to such employees have been made, in complete compliance with the provisions of all material accrual or material arrangement for or payment of bonuses or special compensation applicable under tax and other laws. There are no tax liens upon any of the assets of Acquiror. D. Absence of Certain Changes or Events. Except as set forth in this Agreement or the Acquiror Schedules, since December 31, 1998: (1) There has not been (a) any material adverse change in the business, operations, properties, assets, or financial condition of Acquiror (whether or not covered by insurance) materially and adversely affecting the business, operations, properties, assets, or conditions of Acquiror; (2) Acquiror has not (a) amended its Articles of Incorporation or Bylaws; (b) declared or made, or agreed to declare or make, any payment of dividends or distributions of any assets of any kind whatsoever to stockholders or purchased or redeemed, or agreed to purchase or redeem any of its capital stock; (c) waived any rights or value which in the aggregate are extraordinary or material considering the business of Acquiror; (d) made any material change in its method of management, operation, or accounting; (e) entered into any other material transactions; (f) made any accrual or arrangement for or payment of bonuses or special compensation of any kind or any severance or termination pay to any present or former officer or employees (g) increased the rate of 12 compensation payable or to become payable by it to any of its officers or directors of any of its employees; or (h) established or made any increase in any profit sharing, bonus, deferred compensation, insurance, pension, retirement, or other employee benefit plan, payment, or arrangement made to, for, or with its officers, directors, or employees; (3) Acquiror has not (a) granted or agreed to grant any options, warrants, or other rights for its stocks, bonds, or other corporate securities calling for the issuance thereof; (b) borrowed or agreed to borrow any funds or incurred, or become subject to, any material obligation or liability (absolute or contingent) except liabilities incurred in the ordinary course of business; (c) paid any material obligation or liability (absolute or contingent) other than current liabilities reflected in or shown on the Acquiror balance sheet as of September 30, 1998, and current liabilities incurred since that date in the ordinary course of business; (d) sold or transferred, or agreed to sell or transfer, any of its assets, property, or rights, (e) made or permitted any amendment or termination of any contract, agreement, or license to which it is a party if such amendment or termination is material, considering the business of Acquiror; or (f) issued, delivered, or agreed to issue or deliver any stock, bonds, or other corporate securities including debentures (whether authorized and unissued or held as treasury stock); and (4) To the best knowledge of Acquiror, it has not become subject to any law or regulation which materially and adversely affects, or in the future may adversely affect, the business, operations, properties, assets, or condition of Acquiror. E. Litigation and Proceedings. To the best knowledge of Acquiror it is not involved in any pending litigation, claims, or governmental investigation or proceeding not reflected in such financial statements or otherwise disclosed in the Acquiror Schedules and there are no lawsuits, claims, assessments, investigations, or similar matters, to the best knowledge of management,. threatened or contemplated against Acquiror, its management, or properties. F. Organization. As of the Closing Date Acquiror shall be duly organized, validly existing, and in good standing under the laws of the State of Delaware; it has the corporate power to own its property and to carry on its business as now being conducted and is duly qualified to do business in any jurisdiction where the failure to qualify would have a material adverse effect on Acquiror. G. Tax Returns. Acquiror has filed all federal, state, county, and local income, excise, property, and other tax returns, forms, or reports, which are due or required to be filed by it prior to the date hereof. Acquiror has paid or made adequate provisions for the payment of all taxes, penalty fees, or assessments which have or may become due pursuant to such filed returns or pursuant to any assessments received. H. Contracts. (1) Except as included or referred to in the Acquiror Schedules, there are no material contracts, agreements, franchises, license agreements, or other commitments to 13 which Acquiror is a party or by which it or any of its properties are bound. (2) Subject to the laws of bankruptcy, insolvency, general creditor's rights, and equitable principles, all contracts, agreements, franchises, license agreements, and other commitments to which Acquiror is a party or by which it or its properties are bound, and which are material to the operations of Acquiror, are valid and enforceable by Acquiror in all respects. (3) Acquiror is not a party to any contract, agreement, commitment, or instrument or subject to any charter or other corporate restriction or any judgment, order, writ, injunction, decree, or aware which materially and adversely affects, or in the future may (as far as Acquiror can now foresee) materially and adversely affect, the business, operations, properties, assets, or condition of Acquiror. (4) Except as included or referred to in the Acquiror Schedules or reflected in the latest Acquiror balance sheet, Acquiror is not a party to any material oral or written (a) contract for the employment of any officer or employee; (b) profit sharing, bonus, deferred compensation, stock option, severance pay, pension, benefit, or retirement plan, agreement, or arrangement covered by Title IV of the Employee Retirement Income Security Act, as amended; (c) agreement, contract, or indenture relating to the borrowing of money; (d) guaranty of any obligation, other than one which Acquiror is a primary obligor, for the borrowing of money or otherwise, excluding endorsements made for collection and other guarantees of obligations, which, in the aggregate do not exceed $10,000; (e) consulting or other similar contract with an unexpired term of more than one year or providing for payments in excess of $10,000 in the aggregate; (f) collective bargaining agreement; (g) agreement with any present or former officer or director of Acquiror; or (h) contract, agreement or other commitment involving payments by it of more than $10,000 in the aggregate. I. Material Contract Defaults. To the best of its knowledge, Acquiror has not materially breached, nor has it any knowledge of any pending or threatened claims or any legal basis for a claim that Acquiror has materially breached, any of the terms of conditions of any agreements, contracts, or commitments to which it is a party or is bound and the execution and performance hereof will not violate any provisions of applicable law of any agreement to which Acquiror is subject. J. Capitalization. The capitalization of Acquiror is, as of the date hereof, comprised of 100,000,000 shares of authorized common stock, $.00l par value, of which 70,000,000 shares are issued and outstanding. As an integral part of the stock-for-stock exchange provided for herein, Acquiror shall effect a 1 for 70 reverse split of its issued and outstanding shares thereby reducing the number of such shares from 70,000,000 to 11,500,000 (including all shares to be issued to Acquiree and others in connection with the transactions contemplated herein). All outstanding shares have been duly authorized, validly issued, and fully-paid, and there are no outstanding or presently authorized securities, warrants, options, or related commitments of any nature not disclosed in the Acquiror's financial statements or in the Acquiror's Prospectus, proxy statement or in the Acquiror Schedules 14 attached hereto. All of the outstanding shares are non-assessable and free of cumulative voting or pre-emptive rights. K. Subsidiaries. Acquiror has no subsidiaries and does not own any capital stock, security, partnership interest, or other interest of any kind in any corporation, partnership, joint venture, association, or other entity. L. Corporate Records. The corporate financial records, minute books, and other documents and records of Acquiror are to be available to present management of Acquiree prior to the Closing Date and turned over to new management in their entirety at Closing or as soon thereafter as practicable. M. No Conflict with Other Instrument. The execution of this Agreement will not violate or breach any document, instrument, agreement, contract, or commitment material to the business of Acquiror, to which Acquiror is a party. N. Securities Laws. Acquiror is a public company and represents that to the best of its knowledge it has no existing or threatened liabilities, claims, lawsuits, or basis for the same with respect to its original stock issuance to its founders, its public offering, or any dealings with its Stockholders, the public, brokers, the Securities and Exchange Commission, state agencies, or other persons. Acquiror is required to file Reports under Section 15(d) of the Securities Exchange Act of 1934, as amended. Acquiror represents that all reports required to be filed pursuant to Section 15(d) of the Securities Act of 1934 as of the date of closing have been or will have been filed. O. Compliance With Laws and Regulations. Acquiror has complied with all applicable statutes and regulations of any federal, state, or other applicable governmental entity or agency thereof, except to the extent that noncompliance would not materially and adversely affect the business, operations, properties, assets, or condition of Acquiror or except to the extent that noncompliance would not result in the incurrence of any material liability including, but not limited to, the Blue Sky regulations of this proposed acquisition and issuance of Acquiror common stock. P. Acquiror Schedules. Acquiror has delivered to Acquiree the following schedules, which are collectively referred to as the "Acquiror Schedules," which are dated the date of this Agreement, all certified by an officer of Acquiror and the officers of Acquiror to be complete, true, and accurate: (1) A schedule containing complete and accurate copies of the Articles of Incorporation and Bylaws of Acquiror as in effect as of the date of this Agreement and copies of all Board of Directors and Shareholders Resolutions, Minutes and Consents. (2) A schedule containing copies of all financial statements referred to in paragraph 6(c); (3) A schedule containing the Prospectus of any previous public offering of common stock of Acquiror; (4) A schedule containing a list of the shareholders of Acquiror as of March 1, 1999; (5) A schedule describing all outstanding warrants to purchase shares of Acquiror's common stock; 15 (6) A schedule setting forth a description of any material adverse change in the business, operations, property, inventory, assets, or conditions of Acquiror since December 31, 1998; (7) A schedule of all litigation or governmental investigation or proceeding which is pending or which, to the best knowledge of management, is threatened or contemplated; (8) A schedule containing copies of all contracts to which the Company is a party; (9) A schedule containing all reports filed with the Securities and Exchange Commission pursuant to the Securities Exchange Act of 1934, as amended; (10) A schedule of all other documents, disclosures, or representations required to be disclosed by this Agreement or required to be disclosed in order to set forth all material facts regarding Acquiror. R. Information. The information concerning Acquiror set forth in this Agreement and in the Acquiror Schedules is complete and accurate in all material respects and does not contain any untrue statement of a material fact or omit to state a material fact require to make the statements made, in light of the circumstances under which they were made, not misleading. 7. Information Statement, Meeting of Rexford Shareholders. As promptly as practicable after the execution of this Agreement, Acquiror shall prepare and file with the Securities and Exchange Commission ("SEC"), a preliminary information statement including a notice of special meeting of its stockholders and related material (the "Information Statement") relating to the approval of this Agreement and the transactions contemplated hereunder, as promptly as practicable following receipt of the SEC's comments thereon (or, should no SEC comments be forthcoming or the lapse of the period of time during which SEC comments are required to be furnished, promptly following a determination that no comments are forthcoming or the lapse of such period), Acquiree shall file with the SEC and mail to its stockholders of record a definitive Information Statement relating to such matters. The Information Statement shall set a date of record for all shareholders entitled to vote on this Agreement and shall include the recommendation of the Acquiree's board of directors in favor of such matters. 8. Additional Financial Statements. To the extent required, Acquiree and Acquiror shall utilize their best efforts and cooperate to provide the financial information necessary to present the pro forma consolidated financial statements, including a pro forma consolidated balance sheet, pro forma consolidated income statements, for all periods required to be presented, including the notes thereto, and in the form and manner required for use in the Form 8-K and/or Information Statement or any other document required to be filed with the SEC, requiring the presentation of the Acquiror's financial statements under generally accepted accounting principles. 9. Closing Date. The Closing Date herein referred to shall be upon such date as the parties hereto may mutually agree upon, but is expected to be on or about March 31, 1999, but not later than April 30, 1999. At the Closing, Acquiror shall deliver and the Stockholders will be deemed to have accepted delivery, the certificate of stock to be issued in his or her name, and in connection therewith, will make delivery of his or her stock in Acquiree to Acquiror. Certain opinions, exhibits, etc., may be delivered subsequent to the Closing Date upon the mutual agreement of the parties hereto. 10. Conditions Precedent to the Obligations of Acquiree and the 16 Stockholders. All obligations of Acquiree and Stockholders under this Agreement are subject to the fulfillment, by Acquiror, prior to or as of the Closing Date, of each of the following conditions: A. The representations and warranties by or on behalf of Acquiror contained in this Agreement or in any certificate or documents delivered to Acquiree pursuant to the provisions hereof shall be true in all material respects at and as of the time of Closing as though such representations and warranties were made at and as of such time. B. Acquiror shall have performed and complied with all covenants, agreements, and conditions required by this Agreement to be performed or complied with by it prior to or at the Closing on the Closing Date. C. Acquiror shall take all corporation action necessary to issue the shares to Stockholders pursuant to this Agreement. D. The election or appointment of all of Acquiree's nominees to the Board of Directors of Acquiror as directed by Acquiree and the resignation of the existing officers and directors of Acquiror and the transfer of the office of Registered Agent to such party as is designated by Acquiree. E. Stockholders of Acquiror approving this Agreement and Acquiror's performance hereof; F. Stockholders of Acquiror approving a 1 for 70 reverse split of the Acquiror's issued and outstanding shares of common stock. G. Stockholders of Acquiror approving a proposal to amend Acquiror's Articles of Incorporation to change Acquiror's name to Lexon Technologies, Inc. H. All instruments and documents delivered to Stockholders pursuant to the provisions hereof shall be reasonably satisfactory to legal counsel for Stockholders. I. Acquiror shall have delivered to Stockholders and Acquiree an opinion of its counsel dated the Closing Date to that effect that (1) Acquiror is a corporation duly organized, validly existing, and in good standing under the laws of the State of Delaware; (2) Acquiror has the corporate power to carry on its business as now being conducted; (3) This Agreement has been duly authorized, executed, and delivered by Acquiror and is a valid and binding obligation of Acquiror; and (4) The shares to be issued to Stockholders hereunder will, when issued, be duly and validly issued, fully paid, and non-assessable. 11. Conditions Precedent to the Obligations of Acquiror. All obligations of Acquiror under this Agreement are subject to the fulfillment, by Acquiree and Stockholders, prior to or as of the Closing Date, of each of the following conditions: A. The representations and warranties by Acquiree and 17 Stockholders contained in this Agreement or in any certificate or document delivered to Acquiror pursuant to the provisions hereof shall be true at and as of the time of Closing as though such representations and warranties were made at and as of such time. B. Acquiree and Stockholders shall have performed and complied with all covenants, agreements, and conditions required by this Agreement to be performed or complied with by it prior to or at the Closing; including the delivery of all of the outstanding stock of Acquiree. C. The acquisition and proposed issuance of Acquiror common stock can be effected as a non-public offering pursuant to provisions of applicable federal and state securities laws. Acquiree shall cause to be prepared and filed all forms, notices, fees and reports necessary to comply with any and all blue sky laws, rules and regulations relating to the stock- for-stock exchange contemplated herein. Acquiror shall sign, as required, any and all notices, forms, reports or other documents so prepared by Acquiree. D. Stockholders shall deliver to Acquiror a letter commonly known as an "investment letter" agreeing that the shares of stock in Acquiror are being acquired for investment purposes, and not with a view to public resale and that the materials, including current financial statements prepared and delivered by Acquiror to Stockholders, have been read and understood by Stockholders, that he is familiar with the business of Acquiror, that he is acquiring the Acquiror shares under Section 4(2), commonly known as the private offering exemption of the Securities Act of 1933, and that the shares are restricted and may not be resold, except in reliance of an exemption under the Act. E. Acquiree shall have delivered to Acquiror an opinion of counsel dated the Closing Date to the effect that: (1) Acquiree is duly organized, validly existing and in good standing under the laws of the State of Illinois; (2) Acquiree has the corporate power to carry on its business as now being conducted, and is duly qualified to do business in the State of Illinois and in any jurisdiction where so required where the non qualification to do business in any jurisdiction would not materially adversely affect the business and properties of Acquiree; and (3) This Agreement has been duly authorized, executed, and delivered by Acquiree and Stockholders. 12. Indemnification. Within the period provided in paragraph 13 herein and in accordance with the terms of that paragraph, each party to this Agreement shall indemnify and hold harmless each other party at all times after the date of this Agreement against and in respect of any liability, damage, or deficiency, all actions, suits, proceedings, demands, assessments, judgments, costs, and expenses which exceed $10,000 including attorney's fees incident to any of the foregoing, resulting from any misrepresentations, breach of covenant, or warranty or nonfulfillment of any agreement on the part of such party under this Agreement or from any misrepresentation in or omission from any certificate furnished or to be furnished to a party hereunder. Subject to the terms of this Agreement, the defaulting party shall reimburse the other party or parties on demand, for any reasonable payment made by said parties at any time after the Closing, in respect of any liability of claim to which the foregoing indemnity relates, if such payment is made after reasonable notice to the other party to defend or satisfy the same and such party failed to defend or satisfy the same. No 18 liability shall arise for party hereof regarding a settlement of any claim unless such settlement was previously approved by such party. 13. Nature and Survival of Representations. All representations, warranties, and covenants made by any party in this Agreement shall survive the Closing hereunder and the consummation of the transactions contemplated hereby for two years from the date hereof. All of the parties hereto are executing and carrying out the provisions of this Agreement in reliance solely on the representations, warranties, and covenants and agreements contained in this Agreement or at the Closing of the transactions herein provided for and not upon any investigation upon 'which it might have made or any representations, warranty, agreement, promise, or information, written or oral, made by the other party or any other person other than as specifically set forth herein. 14. Documents at Closing. At the Closing the following transactions shall occur, all of such transactions being deemed to occur simultaneously: A. Stockholders will deliver, or cause to be delivered, to Acquiror the following: (1) Stock certificates for all of the issued and outstanding stock of Acquiree being tendered and duly endorsed; (2) All corporate records of Acquiree, including without limitation, corporate minute books (which shall contain copies of the Articles of Incorporation and Bylaws, as amended to the Closing), stock ledgers, stock transfer books, corporate seals, and other such corporate books and records as may reasonably be requested for review by Acquiror and its counsel; (3) The opinion of counsel for Acquiree as set forth herein; (4) A certificate executed by the Principal Stockholders to the effect that all representations and warranties made by Acquiree under this Agreement are true and correct as of the Closing, the same as though originally given to Acquiror on said date; (5) A certificate from the Secretary of State of its incorporation dated within 45 days of the Closing Date to the effect that Acquiree is in good standing under the laws of said state; (6) An investment letter from the Stockholders representing that they are acquiring shares of Acquiror for investment purposes only and not with a view to further distribution; (7) Such other instruments, documents, and certificates, if any, as are required to be delivered pursuant to the provision of this Agreement or which may be reasonably requested in furtherance of the provisions of this Agreement. B. Acquiror will deliver or cause to be delivered to the 19 Stockholders and Acquiree: (1) Stock certificates for common stock to be issued as part of the exchange as listed on Exhibit "A"; (2) A certificate of the president and secretary of Acquiror to the effect that all representations and warranties of Acquiror made under this Agreement are reaffirmed on the Closing Date, the same as though originally given to Stockholders on said date; (3) The opinion of Acquiror's counsel set forth herein; (4) Certified copies of resolutions by Acquiror's Board of Directors and Stockholders authorizing this transaction; (5) A certificate from the Secretary of State of Acquiror's state of incorporation dated within 45 days of the Closing Date that Acquiror is in good standing under the laws of said state; (6) Such other instruments and documents as are required to be delivered pursuant to the provisions of this Agreement. 15. Additional Covenants. Between the date hereof and the Closing Date, except with the prior written consent of the other party: A. Acquiror and Acquiree shall conduct their business only in the usual and ordinary course and the character of such business shall not be changed nor any different business be undertaken. B. No change shall be made in the Articles of Incorporation or Bylaws of Acquiror or Acquiree, except as described in the Acquiree Schedules attached hereto. C. No change shall be made in the authorized or issued shares of Acquiror or Acquiree. D. Neither Acquiror nor Acquiree shall discharge or satisfy any lien or encumbrance or obligation or liability, other than current liabilities shown on the financial statements heretofore delivered and current liabilities incurred since that date in the ordinary course of business. E. Neither Acquiror nor Acquiree shall make any payment or distribution to their respective stockholders or purchase or redeem any shares or capital stock. F. Neither Acquiror nor Acquiree shall mortgage, pledge, or subject to lien or encumbrance any of its assets, tangible or intangible. G. Neither Acquiror nor Acquiree shall cancel any debts or claims or waive any rights. H. Present management of Acquiror agree that after the Closing they will continue to furnish new management with such additional documentation and information regarding Acquiror as is reasonably requested. 20 16. Miscellaneous. A. Further Assurances. At any time and from time to time, after the effective date, each party will execute such additional instruments and take such action as may be reasonably requested by the other party to confirm or perfect title to any property transferred hereunder or otherwise to carry out the intent and purposes of this Agreement. B. Waiver. Any failure on the part of any party hereto to comply with any of its obligations, agreements, or conditions hereunder may be waived in writing by the party to whom such compliance is owed. C. Payment of Expenses. Acquiror shall pay for all of its own legal, accounting and other expenses associated with the consummation of the transactions contemplated under this Agreement, including those costs associated with the preparation, filing, and mailing of the Information Statement to the Acquiror's stockholders and holding a special meeting of the Acquiror's stockholders. Acquiree shall pay for all of its own legal, accounting and other expenses associated with the consummation of the transactions contemplated under this Agreement. D. Notices. All notices and other communications hereunder shall be in writing and shall be deemed to have been given if delivered in person or sent by prepaid first class registered or certified mail, return receipt requested. E. Headings. The section and subsection heading in this Agreement are inserted for convenience only and shall not affect in any way the meaning or interpretation of this Agreement. F. Counterparts. This Agreement may be executed simultaneously in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. G. Facsimile Transmission. Facsimile transmission of any signed original document, and retransmission of any signed facsimile transmission, shall be the same as delivery of an original. At the request of any party hereto, the parties will confirm facsimile transmitted signatures by signing an original document. H. Governing Law. This Agreement was negotiated and is being contracted for in the State of Illinois, and shall be governed by the laws of the State of Illinois, not withstanding any Illinois or other conflict-of-law provision to the contrary, and the securities being issued herein are being issued and delivered in the State of Illinois in accordance with isolated transaction and non-public offering exemption. I. Binding Effect. This Agreement shall be binding upon the parties hereto and inure to the benefit of the parties, their respective heirs, administrators, executors, successors, and assigns. J. Entire Agreement. This Agreement contains the entire agreement between the parties hereto and supersedes any and all prior agreements, arrangements, or under-standings between the parties relating to the subject matter hereof. No oral understandings, statements, promises, or inducements contrary to the terms of this Agreement exist. No representations, warranties, covenants, or conditions, express or implied, other than as set forth herein, have been made by any party. [Signatures appear on the next page following]. 21 IN WITNESS WHEREOF, the parties have executed this Agreement the day and year first above written. ATTEST: Rexford, Inc., a Delaware corporation By /s/ Tom Sollami, By /s/ Dennis Blomquist -------------------------------- ----------------------------------- Secretary President ATTEST: Chicago Map Corporation, an Illinois corporation By /s/ Mike Barnett By /s/ Steven J. Peskaitis -------------------------------- ---------------------------------- Secretary President STOCKHOLDERS (See Exhibit "B" attached hereto in counterparts.) 22 Exhibit A CHICAGO MAP CORPORATION List of Stockholders Number of Shares of Number of Rexford, Inc. Chicago Map Shares to be Received Name of Shareholder Corporation Percent in Exchange - ------------------- ----------- ------- ----------- Steven J. Peskaitis 10,337 66.767 7,235,970 Stanley Peskaitis 1,824 12.160 1,276,800 Mike Barnett 641 4.273 448,700 David A. Schulz 1,044 6.960 730,800 David A. Leonard 110 .733 77,000 Paris Karahalios 1,044 6.960 730,800 ------ ------ ----------- Total Percentage/Shares 15,000 100.00 10,500,000 ====== ====== ========== 23 Exhibit B CHICAGO MAP CORPORATION Stockholders Counterpart Signature Page Date: Signature: 3/23/99 /s/ Steven J. Peskaitis 3/23/99 /s/ Stanley Peskaitis 3/23/99 /s/ Mike Barnett -----END PRIVACY-ENHANCED MESSAGE-----