-----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, VSYvtbUN2IdM0YTPm7uMYZB5oy7jCfrcj/T9VNlH3FbNJcZ88its2OrhvH+PZYXJ hmbrAxdaoMk4hMyADDLe6g== /in/edgar/work/20000621/0001010412-00-000149/0001010412-00-000149.txt : 20000920 0001010412-00-000149.hdr.sgml : 20000920 ACCESSION NUMBER: 0001010412-00-000149 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 5 CONFORMED PERIOD OF REPORT: 20000605 ITEM INFORMATION: ITEM INFORMATION: ITEM INFORMATION: ITEM INFORMATION: ITEM INFORMATION: FILED AS OF DATE: 20000621 FILER: COMPANY DATA: COMPANY CONFORMED NAME: BALANCED LIVING INC CENTRAL INDEX KEY: 0001074909 STANDARD INDUSTRIAL CLASSIFICATION: [8200 ] IRS NUMBER: 870609860 STATE OF INCORPORATION: NV FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 333-69415 FILM NUMBER: 658514 BUSINESS ADDRESS: STREET 1: 6375 SOUTH HIGHLAND DR SUITE D CITY: SALT LAKE CITY STATE: UT ZIP: 84121 BUSINESS PHONE: 8014241624 MAIL ADDRESS: STREET 1: 6375 SOUTH HIGHLAND DR. SUITE D CITY: SALT LAKE CITY STATE: UT ZIP: 84121 8-K 1 0001.txt SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act May 10, 2000 Date of Report (Date of Earliest Event Reported) BALANCED LIVING, INC. (Exact Name of Registrant as Specified in its Charter) Colorado 333-69415 87-0575577 (State or other (Commission File No.) (IRS Employer I.D. No.) Jurisdiction) 5525 South 900 East Salt Lake City, Utah 84117 (Address of Principal Executive Offices) (801) 262-8844 Registrant's Telephone Number 6375 South Highland Drive, Suite D Salt Lake City, Utah 84121 (Former Name or Former Address if changed Since Last Report) Item 1. Changes in Control of Registrant. (a) On June 5, 2000, Jenson Services, Inc., a Utah corporation ("Jenson Services"), purchased 2,500,000 shares of the Registrant's common stock ("restricted securities") from the Registrant in consideration of the sum of $25,000 (the "Jenson Services Purchase Proposal"). These shares represent approximately 72% of the outstanding voting securities of the Registrant. Duane S. Jenson of Salt Lake City, Utah, is the President and principal stockholder of Jenson Services. A copy of the Jenson Services Purchase Proposal dated May 30, 2000, is attached hereto and incorporated herein by reference. See Item 7. Joel Hardman and Jeffrey Hardman, brothers, and sons of Mr. Jenson's wife, were designated to serve on the Board of Directors, and then, the former sole director and executive officer of the Registrant, Jeannene Barham, resigned. See Item 6. The former majority stockholders of the Registrant and their percentage of ownership of the outstanding voting securities of the Registrant prior to this purchase were: Jeannene Barham, President and a director, 305,834 shares or 35.2%; and Rose N. Blackham, stockholder, 300,000 shares or 34.5%. Jenson Services used corporate funds to purchase these securities; and the basis of its "control" is stock ownership. (b) The following table contains information regarding share holdings of the Registrant's directors and executive officers and those persons or entities who beneficially own more than 5% of the Registrant's common stock: Amount and Nature Percent of Beneficial of Name Title Ownership Class Jenson Services Stockholder 2,500,000 72.09% Jeffrey Hardman President and Director -0- -0- Joel Hardman Secretary and Director -0- -0- Jeannene Barham Stockholder 305,834 8.81% Rose N. Blackham Stockholder 300,000 8.65% --------- ------ Total: 3,105,834 89.55% All officers and directors as a group (2) -0- -0- Item 2. Acquisition or Disposition of Assets. On May 30, 2000, the Registrant received an accepted and signed copy of a Letter of Intent proposal whereby the Registrant proposed to acquire a 97% interest in Wizzard Software Corporation, a Delaware corporation ("Wizzard"). The Letter of Intent provides that the closing of the proposed acquisition is contingent upon the satisfaction of various conditions, including, among others, that the Registrant raise not less than $5,000,000 in a private placement of its common stock to "accredited investors"; that it dispose of its wholly-owned subsidiary, The Balanced Woman, Inc., a Colorado corporation (the "Balanced Woman"); that it acquire or otherwise cancel all outstanding warrants and options to acquire any class of securities of the Registrant, or cancel an equal number of shares of the Registrant for any shares underlying any outstanding warrants or options not acquired and canceled; and that all of its outstanding liabilities be paid or assumed by the Balanced Woman. There is no assurance that the Registrant can satisfy these and other conditions to the closing of this acquisition. A copy of the Letter of Intent is attached hereto and incorporated herein by reference. See Item 7. Wizzard's business operations focus in the areas of the desktop speech/voice recognition markets for both consumers and corporate customers. On May 26, 2000, the Registrant's sole director and executive officer and its principal stockholders who owned in excess of a majority of its outstanding voting securities determined that it would be in the best interests of the Registrant, its stockholders and its wholly-owned subsidiary, the Balanced Woman, to separate the present or proposed business operations of the Registrant and the Balanced Woman. This will be accomplished by conveying all of the outstanding shares of the Balanced Woman that are presently owned by the Registrant to the stockholders of the Registrant in exchange for outstanding warrants or options to acquire common stock of the Registrant that are owned by these stockholders and others. Once accomplished, the Registrant and the Balanced Woman would operate as separate and distinct entities, and the Balanced Woman would be the successor to all of the present business operations of the Registrant and/or the Balanced Woman. The Registrant's stockholders would still retain their entire common stock holdings in the Registrant, while separately owning common stock in the Balanced Woman. This proposal was submitted to the stockholders and warrant and option holders on May 26, 2000, styled as a private placement of "restricted securities" of the Balanced Woman, and is expected to be completed in the very near future. Substantially all of the 45 or so stockholders of the Registrant are "accredited investors." A copy of the Unanimous Consent of the Sole Director and the Majority Stockholders adopting this proposal and outlining the reasons therefor is attached hereto and incorporated herein by reference. See Item 7. Copies of the Agreement and Plan of Exchange or Reorganization (the "Balanced Living Agreement"), together with related exhibits, regarding this disposition will be filed in an amendment to this Report, on the closing of the Balanced Woman Agreement. Item 5. Other Matters. At a special meeting of the stockholders duly called and held on May 10, 2000, Article XIII was added to the Articles of Incorporation of the Registrant which provided that any action which may be taken at any annual or special meeting of stockholders may be taken without a meeting and without prior notice, if one or more consents in writing, setting forth the action so taken, shall be signed by the holders of outstanding shares having not less than the minimum number of votes that would be necessary to authorize or take the action at a meeting at which all shares entitled to vote thereon were present and voted. 605,834 of the 867,849 outstanding shares of the Registrant were voted in favor of the amendment, with none abstaining and none voting against the amendment. A copy of the Certificate of Amendment is attached hereto and incorporated herein by reference. See Item 7. Item 6. Resignations of Directors and Executive Officers. Effective May 30, 2000, Jeannene Barham, the sole director and executive officer of the Registrant, designated and appointed Jeffrey Hardman and Joel Hardman as directors, in accordance with the Registrant's Bylaws and the Colorado Corporation Code, to serve until their successors are elected and qualify or their prior resignations or terminations, and then, Ms. Barham resigned as a director and an executive officer. Subsequently, Jeffrey Hardman was elected the President, and Joel Hardman was elected the Secretary, also to serve in these capacities until their successors are elected and qualify or their prior resignations or terminations. Item 7. Financial Statements and Exhibits. (a) Financial Statements of Business Acquired. If the proposed acquisition of the 97% interest in Wizzard is closed and completed, the required audited financial statements of Wizzard will be filed in an amendment to this Report, in the manner and within the time required by Form 8-K of the Securities and Exchange Commission. (b) Pro Forma Financial Information. If the proposed acquisition of the 97% interest in Wizzard is closed and completed, pro forma financial statements, taking into account this acquisition, will be filed in an amendment to this Report, in the manner and within the time required by Form 8-K of the Securities and Exchange Commission. If the proposed disposition of the Balanced Woman is closed and completed, pro forma financial statements, taking into account this disposition, will also be filed in an amendment to this Report, in the manner and within the time required by Form 8-K of the Securities and Exchange Commission. If both of these transactions are timely closed and completed, the pro forma financial statements will reflect both transactions. (c) Exhibits. Exhibit No. Exhibit Description - ----------- ------------------- 3 Certificate of Amendment regarding stockholder action without a meeting. 10.1 Jenson Services Purchase Proposal. 10.2 Letter of Intent regarding Wizzard. 99 Unanimous Consent of the Sole Director and the Majority Stockholders regarding disposition of the Balanced Woman. SIGNATURES Pursuant to the requirements of the Securities and Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned hereunto duly authorized. BALANCED LIVING, INC. Date: 6/21/2000 By/s/ Jeffrey Hardman ----------------------------- Jeffrey Hardman President and Director Date: 6/21/2000 By/s/ Joel Hardman ----------------------------- Joel Hardman Secretary and Director EX-3 2 0002.txt CERTIFICATE OF AMENDMENT OF THE CERTIFICATE OF INCORPORATION OF BALANCED LIVING, INC. The undersigned President of BALANCED LIVING, INC., a corporation organized and existing under the laws of the State of Colorado, does hereby certify as follows: 1. That the name of the Corporation is BALANCED LIVING, INC. 2. Article XIII is being added to the Certificate of Incorporation to provide that any action which may be taken at any annual or special meeting of stockholders may be taken by written consent of a majority of stockholders. 3. Accordingly, the text of the Certificate of Incorporation is hereby amended to read as follows: ARTICLE XIII STOCKHOLDER ACTION WITHOUT MEETING Any action which may be taken at any annual or special meeting of stockholders may be taken without a meeting and without prior notice, if one or more consents in writing, setting forth the action so taken, shall be signed by the holders of outstanding shares having not less than the minimum number of votes that would be necessary to authorize or take the action at a meeting at which all shares entitled to vote thereon were present and voted. 4. The aforesaid Amendment to the Articles of Incorporation was adopted by the Board of Directors and by stockholders at a meeting called and held May 10, 2000. Of the 867,849 shares outstanding, 605,834 voted in favor of the amendment, with none voting against and none abstaining. IN WITNESS WHEREOF, I, Jeannene Barham, President of the Corporation, have subscribed this document and do hereby affirm, under penalty of perjury, that the statements contained herein have been examined by me and are true and correct as of this 22nd day of May, 2000. BALANCED LIVING, INC. By/S/Jeannene Barham EX-10.1 3 0003.txt [Jenson Services letterhead] 5525 South 900 East Salt Lake City, Utah 84117 May 30, 2000 Jeannene Barham, President Balanced Living, Inc. 6375 South Highland Drive, Suite D Salt Lake City, Utah 84121 Re: Acquisition or reorganization proposal for Balanced Living, Inc., a Colorado corporation (the "Company") Dear Ms. Barham: Jenson Services, Inc., a Utah corporation and financial consulting firm ("Jenson Services"), specializes in acquisitions, reorganizations and mergers of privately-held companies desiring to go public through a "reverse" acquisition, reorganization or merger, other types of reorganizations or mergers and venture capital funding. Leonard W. Burningham, Esq., who acts as your counsel, has also represented us for a number of years, but we waive any requirement that he represent us in the following proposal, along with any potential conflict that may exist. We are also certain that you have qualified financial consultants that can review all matters proposed with you. The Company has had preliminary discussions with representatives of Wizzard Software Corporation, a Delaware corporation ("Wizard"), whose business operations focus in the areas of the desktop speech/voice recognition markets for both consumers and corporate customers. A copy of all material information that has presently been provided to me regarding Wizzard is attached hereto for your review. I am also attaching a proposed Letter of Intent. The terms and conditions thereof are satisfactory to Wizzard. Please note that a condition to the closing of this particular proposed reorganization would require that a minimum of $5,000,000 and a maximum of $9,000,000 be raised by the Company at an offering price of between $2.50 and $4 per share. Jenson Services and another venture capital firm are confident that they can raise the minimum funding to satisfy this condition, and would target to raise at least $7,000,000; however, no assurance can be given that these funds can be raised to satisfy this condition. This Letter of Intent assumes that Jenson Services shall become the controlling stockholder of the Company for all purposes respecting completing this proposal. Jenson Services proposes (and the Letter of Intent provides) to deposit the sum of $25,000 into the trust account of Leonard W. Burningham, Esq., who shall be engaged to represent the Company in connection with the proposed reorganization, for the payment of such expenses as may become due respecting the reorganization and the sale of your subsidiary's shares as outlined in your proposal to the Company's stockholders dated May 26, 2000 (except for the printing and issuance of the subsidiary's shares and the engagement of its transfer agent), including but not limited to legal, accounting, courier and mailing fees and similar costs. Jenson Services would also agree to indemnify and hold the Company harmless for any additional expenses in regard to the proposed reorganization and/or the conveyance and/or exchange of the shares owned by the Company in its subsidiary, The Balanced Woman, Inc., a Colorado corporation ("Balanced Woman"). The sale of the Balanced Woman and the cancellation of the outstanding warrants and options to acquire outstanding securities of the Company is an important condition to the completion of this proposal. It will be difficult to raise the funds to satisfy the minimum cash requirements of the Letter of Intent while there are outstanding options or warrants, some at substantially less than the proposed offering price of the private placement. Respecting the rights granted to you and Rose N. Blackham to cancel shares owned by you in Balanced Living for every share underlying any warrant or option not exchanged by the holders thereof for Balanced Woman shares, we will assume this responsibility, at your option, but instead of receiving shares of Balanced Woman in exchange therefor, we would cancel the Balanced Woman shares to its treasury, which would increase the percentage of ownership of the other stockholders of Balanced Woman. In consideration of the foregoing, Jenson Services shall be issued shares of "restricted securities" (common stock) amounting to not less than 2,500,000 of the outstanding voting securities of the Company, so that Jenson Services will have absolute control over the completion of this proposal. There will be a forward split of the outstanding securities of the Company under the proposal of 1.65 for one, and of the 2,500,000 shares to be issued to Jenson Services (4,125,000 following the split), Jenson Services will only retain 100,000 post-split shares. Jenson Services anticipates that on the execution of the Letter of Intent that the required funding can be raised within 30 to 45 days thereafter. This would provide for an estimated closing of the proposed reorganization no later than mid-July, 2000. Time is of the essence. Mr Burningham will be out-of-town from May 31 until June 17, and we would like to complete the first draft of the Private Offering Memorandum prior to his departure; by then, the name of the broker being utilized and the offering price of the private placement should be known. We also consider it to be very important to examine the industry in which Wizzard presently operates, and to formulate the outline of a business plan covering the required funding or cash requirements and sources, material purchases of plant and equipment and available financing arrangements and other material factors, with this business plan outline being prepared on the assumption that this particular proposal has been completed. If the new directors then believe that this is a potentially profitable venture for the Company, and if all conditions have been satisfied, it will presumably be completed. We would be happy to provide you with personal references, and you may visit our web site at www.jensonservices.com for information regarding other reorganizations that we have been instrumental in completing. If this proposal is not completed satisfactorily and within a reasonable time, we are confident that any number of well capitalized or viable operating entities would be willing to enter into similar arrangements with the Company. We would be happy to facilitate these, in such event. On the other hand, if the Wizzard proposal cannot be completed, Jenson Services would also be willing to cancel all stock purchased, pay, indemnify and hold the Company harmless from and against any liabilities that are incurred or that may arise during the period of time that it controlled the Company and to cause you to be designated and appointed as the sole director, while obtaining the resignations of the directors that we ask you to nominate, being Joel Hardman and Jeffrey Hardman. Although these persons are our nominees as directors, we are confident that they will act on their own independent judgment. For the purposes of meeting with you and any consultants that may be advising you, we have asked Mr. Burningham to prepare a Consent of Directors and the Majority Stockholders of Balanced Living Inc. to effect the foregoing and the Letter of Intent. I will look forward to discussing this proposal with you at your earliest convenience. Thank you very much. Very truly yours, /s/Duane S. Jenson Duane S. Jenson, President ACCEPTED: May 30, 2000 BALANCED LIVING, INC. By/s/Jeannene Barham Jeannene Barham, President EX-10.2 4 0004.txt BALANCED LIVING, INC. 6375 South Highland Drive, Suite D Salt Lake City, Utah 84121 May 30, 2000 Wizzard Software Corporation 424 Gold Way Pittsburgh, Pennsylvania 15213 Attention: Christopher J. Spencer, President Re: Letter of Intent for the acquisition by Balanced Living, Inc., a Nevada corporation ("Balanced Living"), of 100% of the outstanding securities of Wizzard Software Corporation, a Delaware corporation ("Wizzard") Dear Mr. Spencer: This letter will confirm the following general terms upon which the Board of Directors of Balanced Living will adopt an Agreement and Plan of Reorganization (the "Reorganization ") whereby Balanced Living will exchange shares of its one mill ($0.001) par value common voting stock for up to 100% of the outstanding stock of Wizzard. We propose that a Reorganization approved by our respective Boards of Directors be negotiated and executed and which will set forth in detail our intent, upon the following general terms and conditions: A. The Reorganization At or prior to the closing of the Reorganization (the "Closing"), Balanced Living will: (i) Acquire and/or cancel all outstanding warrants, stock options or other contractual commitments granting the holders thereof the right to acquire any authorized but unissued securities of Balanced Living. (ii) Satisfy and pay all liabilities of any type or nature whatsoever, and shall have no liabilities, material assets or subsidiaries, and all of its expenses incident to the Reorganization or otherwise shall have been paid or satisfied. (iii) Issue an aggregate of 100,000 pre-split shares of its common stock to an attorney (Leonard W. Burningham, Esq. and certain of his employees) for non-capital raising services rendered and to be rendered to Balanced Living prior to the completion of the Reorganization, and the preparation and filing of an S-8 Registration Statement with the Commission registering these shares. These shares shall be valued at $10,000, which is the approximate value of the services to be rendered, without taking into consideration any value for the Reorganization, because of the substantial conditions precedent to its completion and the uncertainty of its Closing; and issue an aggregate of 2,500,000 shares of its common stock to Jenson Services, Inc., a Utah corporation and financial consulting firm ("Jenson Services") in consideration of $25,000. (iv) Effect a 1.65 for one forward split of its outstanding common stock, increasing the pre-Reorganization Balanced Living outstanding shares from 3,467,849 to 5,721,950 shares, more or less (depending upon rounding resulting from the forward split), and taking into account the shares and rights to shares to be canceled in A(v) and the shares to be issued as provided in A(iii). (v) Cancel 4,025,000 shares of its outstanding stock representing a portion of the shares of Balanced Living's common stock that are owned by its principal stockholder in consideration of the Agreement. (vi) Balanced Living shall conduct a private placement (the "Private Offering") of post-split shares of its restricted securities (common stock) at a price of between $2.50 and $4.00 per share, to raise a minimum of $5,000,000 (the "Minimum Offering") and a maximum of $9,000,000 (the "Maximum Offering"), with a condition precedent to the Reorganization being the completion of the Minimum Offering. The Private Offering shall be offered and sold by a registered broker/dealer, to be selected by Balanced Living and Wizzard, that will be paid a sales commission of approximately 8% of the offering proceeds and other related expenses, subject to receipt of the Minimum Offering. The confidential private offering memorandum (the "Offering Memorandum") describing the Private Offering shall be prepared by Balanced Living's counsel, Leonard W. Burningham, Esq.,with the assistance of Wizzard's counsel, and shall primarily describe an investment opportunity in Wizzard, as adjusted to take into account the Reorganization. Wizzard will cooperate with Balanced Living in connection with the Private Offering. Wizzard and Balanced Living shall each indemnify and hold the other, their agents and counsel, harmless from and against any liability of any type or nature whatsoever relating to any misstatements of material information or omissions thereof regarding the other that are contained in the Offering Memorandum. The securities sold in the Private Offering shall be sold, subject to lock-up/leak-out provisions, and shall be subsequently registered with the Securities and Exchange Commission (the "Commission") pursuant to the Securities Act of 1933, as amended (the "Securities Act"), for public resale, as shall be described in the Offering Memorandum. If the Minimum Offering is completed, but the Reorganization is not consummated, then the proceeds of the Private Offering shall be returned to investors, without any deduction therefrom or interest thereon. The reorganized Balanced Living agrees to use its "best efforts" to (i) register all of the securities purchased in the Private Offering by filing a registration statement within forty- five (45) days after the Closing, and (ii) cause such registration statement to be declared effective within one hundred fifty (150) days after Closing. The shares registered hereby shall be subject to lock-up/leak-out provisions which shall allow the investors in the Private Offering to sell or otherwise transfer ten (10%) percent of their shares purchased in each three-month period after the registration statement is declared effective, such amounts to be cumulative. All lock-up/leak-out restrictions shall expire upon the later of eighteen (18) months after the Closing or one year after the registration statement is declared effective. (vii) Acquire all of the outstanding shares of common stock of Wizzard that are owned by its current principal stockholders (the "Principal Stockholders"), amounting to approximately 13,090,000 shares of Wizzard's total outstanding shares of 13,635,938 or approximately 96% of Wizzard's outstanding securities (not including shares issued upon conversion of a certain Convertible Promissory Note dated May 2, 2000 [if converted pursuant to its terms at the Closing]), by the exchange for 13,446,950 shares of restricted common stock of Balanced Living or 1.027268907 shares of Balanced Living for each share of Wizard. (viii) Use its best efforts to acquire the remaining outstanding securities of Wizzard on similar terms and conditions, and to the extent required or necessary by applicable law, and subject to lock-up/leak-out provisions accompanying the offer: (1) file a registration statement with the Commission under the Securities Act covering the share exchange proposal with the remaining Wizzard stockholders on or before one year from the date of the initial Closing of the Reorganization; (2) seek a "no action" letter from the Commission to allow the reorganized Balanced Living to file such a registration statement earlier than one year, and within approximately six months; or (3) seek a "no action" letter from the Commission allowing the reorganized Balanced Living to effect the exchange with Wizzard's remaining stockholders in a transaction exempt from the registration provisions of Section 5 of the Securities Act, whichever can assist in accomplishing the exchange with Wizzard's remaining stockholders as soon as is practicable. (ix) Designate and elect the present directors and executive officers of Wizzard to the same positions with Balanced Living, at which time the current directors and executive officers of Balanced Living will resign. (x) Following the Reorganization, and assuming the sale of an aggregate of 2,800,000 shares at a price of $2.50 in the Private Offering for an aggregate of $7,000,000 (1,750,000 shares, if the Private Offering is at $4.00 per share), there would then be 17,943,900 outstanding shares of Balanced Living's common stock (16,893,900 shares, if the Private Offering is at $4.00 per share), approximately 9% of which would then be owned by the former stockholders of Balanced Living (and approximately 10%, if the Private Offering is at $4.00 per share); approximately 16% of which would then be owned by the Private Offering participants (approximately 10%, if the Private Offering is at $4.00 per share); and approximately 75% of which would then be owned by the Principal Stockholders of Wizzard (approximately 80%, if the Private Offering is at $4.00 per share). Wizzard would then be a 96% subsidiary of Balanced Living, with 3% of the outstanding shares of Wizzard remaining in the hands of Wizzard's prior stockholders. These computations do not include any shares that may be issued in connection with the Convertible Promissory Note dated May 2, 2000. (xi) On Closing, Balanced Living's name will be changed to "Wizzard Software Corporation." (xii) To the extent applicable, the acquisition is intended to be a tax-free reorganization under Section 368(a)(1)(B) of the Internal Revenue Code. No opinion in this respect is given by Balanced Living or its legal counsel. B. The Reorganization. The Reorganization shall include, contain or provide: (i) Representations and Warranties. Customary and usual representations and warranties by the parties. (ii) Opinions of Counsel. For the delivery at Closing of favorable opinions of counsel for the corporate parties with respect to customary and usual matters of law covered under similar agreements and parties. (iii) Financial and Other Information. (a) The examination and inspection of the books and records of each of the parties prior to Closing; the delivery no later than at Closing of customary schedules listing each party's material contracts, real and personal properties, pending, threatened and contemplated legal proceedings and employees; assets and liabilities, including contingencies and commitments, and such other information as is customarily provided or as may be reasonably requested; (b) Each of the parties will provide audited financial statements, consisting of a balance sheet and a related statement of income for the period then ended which fairly present the financial condition of each as of their respective dates and for the periods involved, and such statements shall be prepared in accordance with generally accepted accounting principles consistently applied, on Closing, for such period or periods as shall be set forth in the Reorganization; and (c) The financial statements of Balanced Living shall reflect no liabilities and no assets prior to the Closing, with all expenses related to the Reorganization having been paid. (iv) Expenses. It is understood and agreed that the completion of the Reorganization will require the joint efforts of many parties, including those of Jenson Services, Inc. ("Jenson Services") and Corporate Capital Management, LLC ("CCM"), two financial consulting firms. In the event of the termination of the Reorganization or the failure to satisfy the conditions precedent to the completion of the Reorganization, Balanced Living, Wizzard, Jenson Services and CCM will each bear and pay their respective costs and, except as herein provided, no party shall have any liability to any other for any such expenses. Generally, it is anticipated that all Reorganization related expenses of Balanced Living shall be paid by Jenson Services, with the exception of those related to the legal services to be rendered in relation to the securities matters as outlined in A(vi) above; Wizzard will be responsible for all services and costs of its counsel, Nischwitz, Pembridge & Chriszt Co., LPA, respecting the Reorganization, the Offering Memorandum information respecting Wizzard or otherwise; Wizzard will be responsible for payment of $50,000 and CCM shall be responsible for all other costs billed by the firm of Robson Ferber Frost Chan & Essner, LLP, which will involve the preparation of the Reorganization documents and exhibits and the review of all documents related to the Reorganization. All expenses for matters to occur following the Closing shall be the responsibility of the reorganized Balanced Living, including the costs and expenses related to any required registration statements to be filed with the Commission. In consideration of the expenses of Jenson Services and CCM, and other payments to be made, Jenson Services and CCM intend to negotiate with a small number of current stockholders of Balanced Living, to obtain options to acquire a portion of the Balanced Living shares presently held by such Balanced Living stockholders or to participate in the proceeds from the sale of certain Balanced Living shares so owned. (v) Conduct of Business of Balanced Living and Wizzard Pending Closing. Until consummation or termination of the Reorganization, and except as outlined herein, Balanced Living and Wizzard will conduct business only in the ordinary course and none of the assets of Balanced Living or Wizzard shall be sold or disposed of except in the ordinary course of business or with the written consent of the other party. Balanced Living consent to the recission offer currently being made by Wizzard. (vi) Balanced Living and Wizzard will use their respective "best efforts" to complete the Reorganization in a timely manner, but not later than 120 days from the date of execution of this letter. (vii) Other. (a) Balanced Living and Wizzard shall have received all permits, authorizations, regulatory approvals and third party consents necessary for the consummation of the Reorganization, and all applicable legal requirements shall have been satisfied; (b) The Reorganization shall be executed as soon as practicable; (c) The Boards of Directors of Balanced Living and Wizzard shall have approved, and persons owning not less than 80% of the outstanding voting securities of Wizzard shall have accepted the Reorganization; (d) To the extent required by applicable law, the approval of the Balanced Living and Wizzard stockholders shall have been obtained; (e) All notices or other information deemed required or necessary to be given to any party shall be deemed given when actually received if sent by mail or courier or when received by facsimile transmission provided that a confirmation copy is sent by mail at the following addresses: Balanced Living: 6375 South Highland Drive, Suite D Salt Lake City, Utah 84121 With a copy to: Leonard W. Burningham, Esq Suite 205, 455 E. 500 S. Salt Lake City, Utah 84111 Facsimile: 801-355-7126 Wizzard: 424 Gold Way Pittsburgh, Pennsylvania 15213 Facsimile: 412-621-2625 With a copy to: James R. Chriszt, Esq. Timothy Pembridge, Esq. Cort Shoe Building, Fourth Floor 1265 West 6th Street Cleveland, Ohio 44113-1326 Facsimile: 216-861-8180 and in all cases with copies to: Corporate Capital Management 2000 South Plymouth Road, Suite 210 Minnetonka, Minnesota 55305 Attn: Mark Savage Facsimile: (612) 512-9958 Robson Ferber Frost Chan & Essner, LLP. 530 Fifth Avenue New York, New York 10036-5101 Attn: David I. Ferber, Esq. Facsimile No. (212) 944-7630 (f) Any finder's fee or similar payments with respect to the Reorganization shall be paid by the party agreeing to such fees or payments. (g) The Reorganization shall contain customary and usual indemnification and hold harmless provisions; (h) The transactions which are contemplated herein, to the extent permitted, shall be governed by and construed in accordance with the laws of the State of Delaware. (i) Each party and its agents, attorneys and representatives shall have full and free access to the properties, books and records of the other party (the confidentiality of which the investigating party agrees to retain) for purposes of conducting due diligence investigations; (j) The substance of any public announcement with respect to this Letter of Intent or the Reorganization, other than notices required by law, shall be approved in advance by all parties or their duly authorized representatives; (k) The current Board of Directors and officers of Balanced Living shall resign at closing, and be replaced by those persons designated by Wizzard; and (l) Balanced Living will change its name to "Wizzard Software Corporation." Except as provided in paragraphs B(iv), B(v) and B(vii)(i) and (j), this letter merely evidences the intention of the parties hereto and is not intended to be legally binding; it may be terminated by either party without qualification. C. Counterparts. This Letter of Intent may be executed in any number of counterparts each of which shall be deemed to be an original instrument, and all of such counterparts together shall constitute but one agreement. If the foregoing correctly sets forth the substance of the understanding of the parties, please execute this letter in duplicate, retain one copy for your records, and return one to Leonard W. Burningham, at his address, which is Suite 405 Hermes Building, 455 East 500 South, Salt Lake City, Utah 84111; or by facsimile to 801-355-7126. Very truly yours, BALANCED LIVING, INC. By/S/Jeannene Barham President Accepted this 30th day of May, 2000. WIZZARD SOFTWARE CORPORATION By/s/Christopher J. Spencer Christopher J. Spencer, President JENSON SERVICES, INC. By/s/Duane S. Jenson Duane S. Jenson, President CORPORATE CAPITAL MANAGEMENT, LLC By/s/Mark Savage Mark Savage, President EX-99 5 0005.txt ACTION BY UNANIMOUS CONSENT OF THE BOARD OF DIRECTORS AND SOLE STOCKHOLDER OF THE BALANCED WOMAN The undersigned, being the sole director and the sole stockholder of The Balanced Woman, Inc., a Colorado corporation ("Balanced Woman"), acting pursuant to the Colorado Corporation Code, the provisions of the Articles of Incorporation, as amended, and the Bylaws of Balanced Woman, do hereby unanimously consent to and adopt the following resolutions, effective the date hereof unless indicated otherwise: Recitals: Balanced Living, Inc., a Colorado corporation and the parent of Balanced Woman, would like to convey Balanced Woman to the stockholders of Balanced Woman, solely in exchange for warrants or options to acquire shares of Balanced Living that are owned by these stockholders. Balanced Woman would continue operations as a private corporation, owned by these stockholders, while these stockholders would retain their present share ownership in Balanced Living, resulting in their having two investment opportunities from which to potentially profit. The reasons for this action are as follows: 1. The public filing costs and expenses of Balanced Living that are related to its operations through its wholly-owned subsidiary, the Balanced Woman, are very disproportionate to the value received for being a publicly-held company, especially in light of the present limited public market for the common stock of Balanced Living. 2. The legal and accounting expenses attendant to being a publicly-held company have increased greatly during the past two years because of increased regulation and scrutiny of publicly-held companies by the Securities and Exchange Commission, and more recently, with its requirement that all quarterly reports that are required to be filed be reviewed by an independent accounting firm. Further, Balanced Living is required at its cost to maintain the SB-2 Registration Statement it filed with the Securities and Exchange Commission and its Prospectus current by post-effective amendments so that the shares underlying the Class A, B and C warrants that were a part of the units (the "Units") publicly offered and sold by Balanced Living can be exercised, despite the fact that the exercise price of all of these warrants is substantially higher than the present limited public market price for Balanced Living's common stock. The anticipated legal, accounting and printing costs related to any such post-effective amendments would be very expensive, with the possibility of Balanced Living receiving no benefit because none of the warrants would be exercised. 3. Expenses of Balanced Woman and its operations have required numerous loans, mostly from related parties. 4. Balanced Living has had preliminary discussions with a number of financial consulting firms respecting the possibility of an acquisition, reorganization or merger that would benefit Balanced Living and its stockholders with one or more privately-held entities desiring to become a publicly-held company through a "reverse" reorganization or merger. 5. All of these discussions have indicated that any such "reverse" proposal will require the sale or disposition of the Balanced Woman, the cancellation of all outstanding warrants and options because of the cost of maintaining an effective and current SB-2 Registration Statement covering the shares underlying these warrants and options and the satisfaction of all liabilities of Balanced Living. 6. The Balanced Woman, with its present line of products, would have a greater chance of success if its costs were reduced by becoming a privately-held company, owned by the current stockholders and the warrant and option holders of Balanced Living. 7. Balanced Living believes it would be in the best interests of its stockholders and its warrant and option holders to exchange all of the outstanding securities of Balanced Woman for the outstanding warrants and options to acquire shares of common stock of Balanced Living. 8. There is no present market for Balanced Living's common stock, though its shares are nominally quoted on the OTC Bulletin Board of the National Association of Securities Dealers, Inc. (the "NASD"). 9. The lowest exercise price for any of the outstanding warrants or options is $1.00, and the exercise price of the Class A, B and C warrants that were a portion of the Units publicly offered and sold pursuant to Balanced Living's SB-2 Registration Statement are $3.00, $5.00 and $10.00, respectively. 10. One Class A, B and C warrant should be considered to be one warrant for the purpose of the proposed exchange, by reason of the difference between the exercise prices of these warrants and those of the other outstanding warrants and options that are exercisable at $1.00. 11. The exchange of outstanding warrants for the shares owned by Balanced Living in this fashion is more than fair to the stockholders who purchased Units and who own the Class A, B and C warrants because their aggregate ownership interest in the Balanced Woman would be approximately 20% rather than their present aggregate ownership interest in Balanced Living of approximately 11%, while all such stockholders would still retain their respective shares of common stock in Balanced Living and have an opportunity to benefit from any "reverse" reorganization or merger transaction involving Balanced Living. Further, the tax ramifications of the exchange would be nominal to these stockholders because any gain would be taxed as a long term gain. Also, the warrants or options do not have any present value; there is no present market for the Balanced Woman's outstanding securities, except as it may relate to a portion of the value of Balanced Living's common stock, for which there are no current bid or asked prices on the NASD's OTC Bulletin Board; and the present book value of Balanced Living, on a consolidated basis with the Balanced Woman, is a negative of ($207,826). 12. If all of the holders of the outstanding warrants and options do not agree to the exchange, the principal stockholders of Balanced Living, Jeannene Barham and Rose N. Blackham, pro rata, shall cancel to the treasury sufficient shares to cover the number of shares underlying any such outstanding warrants or options that are not exchanged for a pro rata interest in the Balanced Woman, and they shall receive, pro rata, one share in the Balanced Woman by reason of each canceled share. 13. Each Balanced Living warrant or option holder (with the Class A, B and C warrants to be considered to be an aggregate of one warrant for the purpose of the proposed exchange) shall receive one share of the Balanced Woman for each warrant or option that each owns of Balanced Living. Any remaining shares of the Balanced Woman that are owned by Balanced Living following the one for one exchange shall be canceled to the treasury of the Balanced Woman and returned to its authorized capital as authorized but unissued shares. 14. Balanced Living has retained legal counsel with respect to the foregoing, and it is reasonable that this counsel be issued 100,000 shares of common stock of Balanced Living in consideration of all services related to the sale of the Balanced Woman; that such shares be registered on Form S-8 of the Securities and Exchange Commission; that such counsel prepare and file the required registration statement on Form S-8; and that Balanced Living require any candidate for a "reverse" reorganization or merger to pay all other related legal costs and expenses incurred in connection with any such reorganization or merger. Resolutions RESOLVED, that Balanced Woman execute and deliver an Agreement and Plan of Exchange or Reorganization, a copy of which is attached hereto and incorporated herein (the "Agreement"), whereby Balanced Living will exchange all of the Balance Woman's outstanding securities, pro rata, for all of the outstanding warrants or options to acquire authorized but unissued securities of Balanced Living, on a one for one basis, assuming that the aggregate of one Class A, B and C warrant is only deemed to be one warrant for the purpose of calculating the number of shares of the Balanced Woman to be exchanged under the Agreement; FURTHER, RESOLVED, that in the good faith judgment of the sole director of Balanced Woman and its sole stockholder, the common stock of the Balanced Woman is determined to have a fair value of $0.10 per share for the purposes of this exchange only, and the Agreement is fair, just and equitable, and in the best interests of Balanced Woman and its stockholder; FURTHER, RESOLVED, to the extent possible, that the Agreement shall be effective as of March 31, 2000, for accounting purposes; FURTHER, RESOLVED, that the executive officer of Balanced Woman be and hereby is authorized and directed to execute and deliver the Agreement and all other documents required or deemed necessary to complete the Agreement for and on behalf of Balanced Woman pursuant to which Balanced Living shall acquire in exchange for its holdings in the Balanced Woman such warrants and options that are outstanding and that grant such warrant and option holders the right to acquire shares of common stock of Balanced Living in a stock for stock exchange within the meaning of Section 368(a)(1)(B) of the Internal Revenue Code of 1986, as amended, or any other applicable law, rule or regulation; and FURTHER, RESOLVED, that the Balanced Woman shall assume and pay all outstanding liabilities of the Balanced Woman and those of Balanced Living that are in any way related to the operations of the Balanced Woman, on a consolidated basis or otherwise, and indemnify and hold Balanced Living therefrom; and Balanced Woman shall provide letters of compromise and/or settlement from each of its creditors to the effect that Balanced Living has no obligation whatsoever for any such liabilities. Date: May 26, 2000 /S/Jeannene Barham Jeannene Barham, Sole Director SOLE STOCKHOLDER: BALANCED LIVING, INC. Date: May 26, 2000 By/s/Jeannene Barham Jeannene Barham, Sole Director Shares Owned: 500,000 - 100% -----END PRIVACY-ENHANCED MESSAGE-----