-----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, AT9RmUInRww6zfD/7p28kgyhlDXvR9ANPHc0d5L83K1EIRT/pmzOeYlAxGcvW657 K+4CTt6NhaJ7DBmwCsQFpA== 0001432093-10-000433.txt : 20100630 0001432093-10-000433.hdr.sgml : 20100630 20100630170832 ACCESSION NUMBER: 0001432093-10-000433 CONFORMED SUBMISSION TYPE: S-1/A PUBLIC DOCUMENT COUNT: 7 FILED AS OF DATE: 20100630 DATE AS OF CHANGE: 20100630 FILER: COMPANY DATA: COMPANY CONFORMED NAME: INTERNET MEDIA SERVICES, INC. CENTRAL INDEX KEY: 0001487718 STANDARD INDUSTRIAL CLASSIFICATION: RETAIL-NONSTORE RETAILERS [5960] IRS NUMBER: 223956444 STATE OF INCORPORATION: DE FILING VALUES: FORM TYPE: S-1/A SEC ACT: 1933 Act SEC FILE NUMBER: 333-165972 FILM NUMBER: 10927808 BUSINESS ADDRESS: STREET 1: 1434 6TH ST. STREET 2: UNIT 9 CITY: SANTA MONICA STATE: CA ZIP: 90401 BUSINESS PHONE: 3102951922 MAIL ADDRESS: STREET 1: 1434 6TH ST. STREET 2: UNIT 9 CITY: SANTA MONICA STATE: CA ZIP: 90401 S-1/A 1 internetmedias1a.htm internetmedias1a.htm


June 30, 2010                                                                                                                                                   &# 160;                                                                                                          File Number 333-165972

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

 Washington, D.C. 20549

AMENDMENT NO. 1 to
FORM S-1
  REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
 
INTERNET MEDIA SERVICES, INC.
 (Exact name of registrant as specified in its charter)

Delaware
5961
22-3956444
(State or other jurisdiction
(Primary Industrial
(I.R.S. Employer
of Incorporation)
Classification Code)
Identification No.)

1434 6 th Street
Suite 9
Santa Monica, California  90401
(310) 295-1922
(Address, including zip code, and telephone number,
including area code, of registrant's principal executive offices)

Raymond Meyers
Chief Executive Officer
1434 6th Street
Suite 9
Santa Monica, California  90401
(310) 295-1922
 (Name, address, including zip code, and telephone number,
including area code, of agent for service)
 
Copies of all communications, including all communications sent to the agent for
 
service should be sent to:
 
Law Office of Gary A. Agron
5445 DTC Pkwy., Suite 520
Greenwood Village, Colorado 80111
(303) 770-7254
 
Approximate date of commencement of proposed sale to the public:  From time to time after the effective date of this registration statement.
 
If any of the securities being registered on this form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933 check the following box. |X|
 
 
 

 
           If this form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. |_|
 
If this form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. |_|
 
If this form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act Registration Statement number of the earlier effective registration statement for the same offering. |_|
 
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act.
 
Large Accelerated Filer |_| Accelerated Filer |_| Non-accelerated Filer |_| (Do not check if a small reporting company.) Smaller Reporting Company |X|
 
CALCULATION OF REGISTRATION FEE
 
   
Proposed MaximumOffering
Proposed Maximum
Amount of
Title of Each Class of
Amount to be
Offering Price Per
Aggregate Offering
Registration
Securities To Be Registered
Registered
Share (1)
Price
Fee(2)(3)
         
Common Stock
7,500,000
$0.001
$7,500
$6.00
 
[1] No exchange or OTC market exists for the Registrant's common stock. The offering price was arbitrarily established by the Registrant’s management and does not reflect market value, assets or any established criteria of valuation.
 
[2] Estimated solely for purposes of calculating the registration fee under Rule 457(c).

[3] Previously paid.
 
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE SECURITIES AND EXCHANGE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A), MAY DETERMINE.
 
 

 
SUBJECT TO COMPLETION                                   
THE DATE OF THIS PROSPECTUS IS JUNE ___, 2010

INTERNET MEDIA SERVICES, INC.
 
7,500,000 SHARES OF COMMON STOCK
 
The 7,500,000 shares of our common stock currently held by Document Security Systems, Inc. (“DSS”), will be distributed pro rata by us to the shareholders of DSS, based upon each DSS shareholder’s beneficial ownership of DSS shares on the record date, which is the close of business (Eastern daylight time) on __________, 2010 (the "Record Date"). For purposes of this registration statement and in connection with the distribution, we valued the shares to be distributed at $.001 per share.  We are not paying any commissions or discounts in connection with the distribution.  The shares may be illiquid as they are not listed on any national securities exchange nor are the shares quoted on the OTC Bulletin Board or any other quotation service, and no ma rket for the shares may develop.  This prospectus covers the distribution of the shares and their resale.
 
The Offering involves substantial risk.  Please see the “Risk Factors” section beginning on page 4.
 
Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of the prospectus. Any representation to the contrary is a criminal offense.
 
The information in this prospectus is not complete and may be changed. Holders may not sell, and we may not distribute, these securities until the registration statement and any amendment thereto is filed with the Securities and Exchange Commission and is declared effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.
 
_______________, 2010
 
 
 
 
 
 

 
 

 
TABLE OF CONTENTS

 
    Page
   
Summary of our Offering
1
Selected Financial Information
1
Questions and Answers About the Distribution
2
Special Note Regarding Forward-Looking Statements
3
Risk Factors
4
Use of Proceeds
12
Determination of Offering Price
12
Selling Security Holders
13
Plan of Distribution
13
Description of Securities
13
Interest of Named Experts and Counsel
15
Business
15
Market Price of Common Stock and Related Stockholder Matters
20
Management's Discussion and Analysis of Financial Condition and Results of Operations
20
Management
25
Corporate Governance
27
Security Ownership of Certain Beneficial Owners and Management
28
Related Party Transactions
28
Disclosure of Commission Position on Indemnification for Securities Act Liabilities
29
Where You Can Find More Information
29
Financial Statements
F-1

 
 
 

 
SUMMARY OF OUR OFFERING


OUR BUSINESS

Internet Media Services, Inc., is an Internet media company that acquires, builds, markets, and monetizes branded Web-based businesses.  We operate our branded Websites within discrete vertical business channels allowing us to utilize cross-promotion marketing activities between our Websites within a channel. Currently, we operate one Website within one business channel.

We are building our business around the identification, evaluation and cost-effective acquisition of under-valued Websites.  We primarily seek to acquire Web businesses that serve the small and mid-sized businesses since we feel that market segment offers the best opportunity for cost-effective revenue growth.   On October 8, 2009, we completed our first vertical channel acquisition in the legal channel with the asset purchase of the Web property LegalStore.com from Document Security Systems, Inc. in exchange for 7,500,000 shares of our common stock, which we agreed to issue pro rata to the shareholders of DSS.

We were incorporated in March 2007 as a Delaware corporation and refer to ourself herein as “we”, “us”, the “Company” or “IMS.”  We conduct our operations in Rochester, New York and Santa Monica, California.  Our corporate office is located at 1434 6 th Street, Suite 9, Santa Monica, CA 90401 and our telephone number is (310) 295-1922. Our website addresses are www.internetmediaservices.com and www.legalstore.com . Information contained on our websites is not a part of this prospectus.

THE OFFERING
 
We intend to distribute to the shareholders of DSS , on a pro rata basis, an aggregate of 7,500,000 shares of our common stock currently held by DSS based upon each DSS shareholder’s beneficial ownership of DSS shares on the Record Date (_____________). The distribution will be pro rata and the shareholders will not be required to pay any type of consideration in order to participate.
 
SELECTED FINANCIAL DATA
 
The following financial information summarizes the more complete historical financial information at the end of this prospectus.

   
As of March 31, 2010
   
As of December 31, 2009
 
             
Balance Sheet
           
Total Assets
  $ 343,479     $ 349,192  
Total Liabilities
  $ 128,811     $ 60,363  
Shareholders Equity
  $ 214,668     $ 288,829  
                 
   
Three Months Ended
   
Year Ended
 
   
March 31, 2010
   
December 31, 2009 (1)
 
                 
Statement of Operations
               
Revenue
  $ 154,280     $ 111,022  
Cost of Revenue
  $ 68,207     $ 80,983  
Operating Expense
  $ 160,234     $ 104,211  
           Net (Loss)
  $ (74,161 )   $ ( 74,172 )
 
 
(1) The Company’s operation began at the date of acquisition of LegalStore.com, October 8, 2009.
 
 
-1-

 
QUESTIONS AND ANSWERS ABOUT THE DISTRIBUTION
 
WHY IS THE DISTRIBUTION STRUCTURED AS A DIVIDEND, RETURN OF CAPITAL, OR CAPITAL GAIN?
 
We will distribute to the shareholders of DSS, pro rata, 7,500,000 shares of our common stock currently held by DSS in connection with our asset purchase of LegalStore.com from DSS.  This distribution may constitute either a dividend, return of capital, or capital gain to DSS shareholders.  You should consult your tax advisor.
 
HOW WILL THE DISTRIBUTION OCCUR?
 
We will distribute to those shareholders owning shares of DSS common stock all 7,500,000 shares of our common stock currently held by DSS.
 
HOW MANY SHARES OF OUR COMMON STOCK WILL I RECEIVE?
 
You will receive shares of our common stock based upon your beneficial ownership of DSS shares on the Record Date.
 
WHAT IS THE RECORD DATE FOR THE DISTRIBUTION?
 
The record date for stockholders entitled to receive shares of our common stock is __________________.
 
WHAT IS THE DISTRIBUTION DATE?
 
We intend to distribute our shares as soon as possible following the effective date of this registration statement.
 
WHAT IF I WANT TO SELL MY INTERNET MEDIA SERVICES SHARES?
 
You should first consult your financial advisor. Currently, there is no public market for our common stock, and there can be no assurance that any public market will develop in the future.
 
WILL THE NUMBER OF SHARES OF COMMON STOCK I OWN IN DSS CHANGE AS A RESULT OF THE DISTRIBUTION?
 
No. The number of shares of DSS that you own will not change as a result of the distribution.
 
ARE THERE RISKS TO OWNING SHARES OF OUR COMMON STOCK?
 
Yes. Our business is subject to risks which are set forth in this prospectus.
 
WHAT ARE THE REASONS FOR THE DISTRIBUTION?
 
On October 8, 2009, we purchased certain assets of the LegalStore.com from DSS in exchange for 7,500,000 shares of our common stock currently held by DSS, which will be registered and issued to DSS shareholders.
 
 
-2-

 
 SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
 
The Securities and Exchange Commission encourages companies to disclose forward-looking information so that investors can better understand a company's future prospects and make informed investment decisions. This prospectus contains such "forward-looking statements."  These statements may be made directly in this prospectus, and they may also be made a part of this prospectus by reference to other documents filed with the Securities and Exchange Commission, which is known as "incorporation by reference."
 
Words such as "may," "anticipate," "estimate," "expects," "projects," "intends," "plans," "believes" and words and terms of similar substance used in connection with any discussion of future operating or financial performance identify forward-looking statements. All forward-looking statements are management's present expectations of future events and are subject to a number of risks and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. Forward-looking statements might include one or more of the following:
 
o Anticipated results of operations;
 
o Anticipated pricing of goods and services;
 
o Anticipated market demand;
 
o Description of plans or objectives of management for future operations;
 
o Forecasts of future economic performance; and
 
o Descriptions or assumptions underlying or relating to any of the above items.
 
In light of these assumptions, risks and uncertainties, the results and events discussed in the forward-looking statements contained in this prospectus or in any document incorporated by reference might not occur. Investors are cautioned not to place undue reliance on the forward-looking statements, which speak only as of the date of this prospectus or the date of the document incorporated by reference in this prospectus. We are not under any obligation, and we expressly disclaim any obligation, to update or alter any forward-looking statements, whether as a result of new information, future events or otherwise. All subsequent forward-looking statements attributable to us or to any person acting on our behalf are expressly qualified in their entirety by the cautionary statements contained o r referred to in this section.
 
 
-3-

 
RISK FACTORS
 
Investors should carefully consider the risks described below before making an investment decision.  If any of the following risks actually occur, our business could be materially adversely affected. In such case, we may not be able to proceed with our planned operations and your investment may be lost entirely. The securities offered hereby should only be acquired by persons who can afford to lose their entire investment without adversely affecting their standard of living or financial security.

Risks Related to the Company
 
We have a limited operating history and may not be able to achieve financial or operational success.

We were founded in March 2007, and we initiated our first operating business by acquiring LegalStore.com in October 2009.  We have a limited operating history with respect to this or any newly acquired business.  As a result, we may not be able to achieve sustained financial or operational success, given the risks, uncertainties, expenses, delays and difficulties associated with an early-stage business in an evolving market.

Economic conditions could reduce our revenue and adversely affect our customers and our working capital.

The U.S. economy has been in a downward cycle that began in 2007 and substantially deepened in 2008. As most, if not all, of our proposed vertical segments rely on Internet generated sales of goods and services, or Internet revenue generated through the sales of online advertising, the reduced consumer and advertiser demand resulting from the economic downturn may negatively affect our revenues or negatively impact our ability to grow our revenues. We cannot predict when the current economic downturn will end or reverse. There also could be a number of follow-on effects from the credit crisis and current economic environment on our business, including insolvency of customers and the inability for us to raise additional working capital economically to support the growth of our operations.

Our growth strategy includes acquisitions that entail significant execution, integration and operational risks.

We are pursuing a growth strategy based in part on acquisitions, with the objective of creating a combined company that we believe can achieve increased cost savings and operating efficiencies through economies of scale especially in the integration of administrative services.  We closed on our first acquisition in October 2009.  We will seek to make additional acquisitions in the future to increase our revenue.

This growth strategy involves significant risks. There is significant competition for acquisition targets in our markets. Consequently, we may not be able to identify suitable acquisitions or may have difficulty finding attractive businesses for acquisition at reasonable prices. If we are unable to identify future acquisition opportunities, reach agreement with such third parties or obtain the financing necessary to make such acquisitions, we could lose market share to competitors who are able to make such acquisitions. This loss of market share could negatively impact our business, revenues and future growth.

We may be unable to achieve benefits from any acquisitions.
-
           Even if we are able to complete acquisitions, we may be unable to achieve the anticipated benefits of a particular acquisition, the anticipated benefits may take longer to realize than expected, or we may incur greater costs than expected in attempting to achieve anticipated benefits.

 
-4-

 
Any acquisition we make exposes us to risks.

Any acquisition we make carries risks which could result in an adverse effect on our financial condition.  These risks include:

 
diversion of our attention from normal daily operations of our business to acquiring and assimilating new website businesses;

 
the use of substantial portions of any cash we have available;
 
 
failure to understand the needs and behaviors of users for a newly acquired website or other product;  

 
redundancy or overlap between existing products and services, on the one hand, and acquired products and services, on the other hand;  

 
difficulty assimilating operations, technologies, products and policies of acquired businesses; and

 
assuming liabilities, including unknown and contingent liabilities, of acquired businesses.

If any of our relationships with Internet search websites terminate or if such websites’ methodologies are modified, traffic to our websites and corresponding consumer origination volumes could decline.

We depend in part on various Internet search websites, such as Google, MSN and Yahoo!, and other websites to direct a significant amount of traffic to our websites and to generate customer referrals for our customer referral activities. Search websites typically provide two types of search results, algorithmic and purchased listings. Algorithmic listings cannot be purchased and, instead, are determined and displayed solely by a set of formulas designed by search engine companies. Other listings can be purchased and are displayed if particular word searches are performed on a search engine. We rely primarily on algorithmic search results to direct a substantial share of the visitors to our websites and the advertiser customers we serve.

           Our ability to maintain the flow of visitors directed to our websites by search websites and other Internet websites is not entirely within our control. For example, search websites frequently revise their algorithms in an attempt to optimize their search result listings. Changes in the methodologies used by search websites to display results could cause our websites to receive less favorable placements, which could reduce the number of users who link to our websites from these search websites. Any reduction in the number of users directed to our websites would negatively affect our ability to earn revenue. If traffic on our websites declines, we may need to resort to more costly sources to replace lost traffic, and such increased expense could adversely affect our business and profitability.

Increases in the price of online marketing or the modification or termination of our relationships with Internet search websites and other Internet websites could have a negative impact on our revenues, margins and customer referrals.

Prices charged to us for online marketing have increased as a result of increased demand for advertising inventory, which has caused our advertising expenses to increase and our margins to decline. Our advertising contracts with online search engines and other Internet websites are typically short-term. If one or more Internet search websites or other Internet websites on which we rely for marketing modifies or terminates its relationship with us, our marketing expenses could further increase, the amount of website traffic and the number of customer referrals we generate could decrease, and our related revenues or margins could decline. As the number of customer referrals that we require to meet customer demand has increased, we have increased our levels of marketing to meet those requireme nts. However, we cannot assure you that an increase in marketing will result in an increase in customer referrals.

We expect to face increasing competition that could result in a loss of users and reduced profit margins.
 
The market within our designated vertical channels is anticipated to be highly competitive, and we expect competition to significantly increase in the future.  We compete or intend to compete with a wide variety of companies and web-based services, including well established websites.  We also anticipate that a number of companies are or will be attempting to enter the vertical channels we have identified, either directly or indirectly, some of which may become significant competitors in the future. As we broaden our services and evolve into a multi-channel company, we may be faced with increasing competition within each vertical channel we are in.
 
 
-5-

 
Some of our competitors have longer operating histories, greater name and brand recognition, larger user bases, significantly greater financial, technical, sales and marketing resources, and engage in more extensive research and development than we do.  We anticipate some of our competitors will also have lower customer acquisition costs than we do and offer a wider variety of services.  If our competitors are more successful than we are in attracting customers, our ability to maintain a large and growing customer base will be adversely affected.
 
More intense competition could also require us to increase our marketing expenditures, thereby reducing our profit margins and any profitability.

If we are unable to compete effectively, our business, revenues and future growth may suffer.
 
We contend with a variety of Internet and traditional offline competitors.  Many of our current and potential online and traditional store-based or print publication-based competitors have longer operating histories, more industry experience, larger customer or user bases, greater brand recognition and significantly greater financial, marketing and other resources than we do.  These current and potential competitors may be able to devote substantially greater resources to Internet websites and systems development than we can, including through acquisitions, investments and joint ventures. Our competitors may also be able to secure products from vendors on more favorable terms, fulfill customer orders more efficiently, adopt more aggressive pricing or devote more resources to marketing and promotional campaigns. In add ition, traditional store-based and print publication-based retailers are able to offer customers the experience to see and feel products in a manner that is not possible over the Internet.
 
We cannot assure you that we will be able to compete successfully against current or future competitors. Competitive pressures may result in increased marketing costs, decreased prices for our advertising products and services, and decreased website traffic and loss of market share, which would adversely affect our business, revenues and future growth.
 
If we are not successful in increasing the number of our customers or having customers actively engage in revenue producing activities through our websites, products and services, our business and financial results will suffer.
 
The success of our business depends upon our ability to increase our base of customers actively engaged in revenue generating activities through our websites, products or services.  Our ability to increase our base of customers is dependent upon attracting new customers to our websites.  We may not be able to increase the level of new customers visiting our websites.  Failure to increase or maintain our base of customers would reduce our revenue and our ability to implement our strategies.

Our success is dependent upon our ability to enhance the quality and scalability of our various products and services in a changing environment.  If we are unable to do so, we may be unable to generate revenue growth.

Our customers use a wide variety of constantly changing hardware and software. We will continue to invest significant resources to develop products and services for new or emerging software and hardware platforms that may develop from time to time. However, there is a risk that a new hardware or software platform for which we do not provide products or services could rapidly grow in popularity. As a result, we may not be in a position to develop products or services for such platforms or may be late in doing so. If we fail to introduce new products or services that address the needs of emerging market segments or if our new products or services do not achieve market acceptance as a result of delays in development or other factors, our future growth and revenue opportunity could suffer.

 
-6-

 
If we are unable to develop new or enhanced features or fail to predict or respond to emerging trends, our revenue and any profitability will suffer.

Our future success will depend in part on our ability to modify or enhance our website features to meet user’s demands, add features and address technological advancements. If we are unable to predict preferences or industry changes, or if we are unable to modify our website features in a timely manner, we may lose members. New features may be dependent upon our obtaining needed technology or services from third parties, which we may not be able to obtain in a timely manner, upon terms acceptable to us, or at all. We spend significant resources developing and enhancing our features. However, new or enhanced features may have technological problems or may not be accepted by users. If we are unable to successfully develop, acquire or implement new features or enhance our existing features in a timely and cost-effective manner, our re venue and any profitability will suffer.

We do not currently maintain redundant capabilities and a catastrophic event could result in a significant disruption of our services.

Our computer equipment and the telecommunications infrastructure of our third-party network provider are vulnerable to damage from fires, earthquakes, floods, power loss, telecommunications failures, terrorism and similar events. Our servers are also vulnerable to computer viruses, worms, physical and electronic break-ins, sabotage and similar disruptions from unauthorized tampering of our computer systems. We do not currently maintain redundant capabilities and a catastrophic event could result in a significant and extended disruption of our services. Currently, we do not have a disaster recovery plan to address these and other vulnerabilities. As a result, it would be difficult to operate our business in the event of a disaster. Any prolonged disruption of our services due to these, or other events, would severely impact or shut down o ur business. We do not carry earthquake or flood insurance, and the property, business interruption and other insurance we do carry may not be sufficient to cover, if at all, losses that may occur as a result of any events which cause interruptions in our services.

If we fail to develop and diversify our website features, functionality and product and service offerings, we could lose market share.

Internet content, user tools and business models are evolving rapidly due to low barriers to entry and continuous technology innovations. To remain competitive, we must continue to improve the ease of use, responsiveness, functionality and features of our websites, develop content, new products and services, and continually improve the consumer’s purchasing experience. The time, expense and effort associated with such development may be greater than anticipated, and any features, functions, and products and services actually developed and introduced may not achieve consumer or advertiser acceptance or enhance user loyalty. Furthermore, our efforts to meet changing customer needs may require the development or licensing of increasingly complex technologies at great expense. If we are unable to develop and bring to market additional features, functions, content, products and services, we could lose market share to competitors, which could negatively impact our business, revenues and future growth.

Technological advances and changes in customer demands or industry standards could result in increased costs or render our products and services obsolete or less competitive.

The market for our products and services is characterized by rapid technological advances, changes in customer requirements, changes in protocols and evolving industry standards. Our efforts to keep up with such advances, requirements, protocol and standards may lead to increased product and service development costs and costly changes to our procedures and methodologies. If we fail in such efforts, our products and services may become obsolete or less competitive.  There is no assurance that we will be successful in keeping up with technological advances and changes in customer demands and industry standards, and our failure to do so may have a negative impact on our business, prospects and financial condition.

If we are unable to obtain or maintain key website addresses, our ability to operate and grow our business may be impaired.

Our website addresses, or domain names, are critical to our business. However, the regulation of domain names is subject to change, and it may be difficult for us to prevent third parties from acquiring domain names that are similar to ours, that infringe our trademarks or that otherwise decrease the value of our brands. If we are unable to obtain or maintain key domain names for the various areas of our business, our ability to operate and grow our business may be impaired.

 
-7-

 
Assertions by any third party that we infringe its intellectual property could result in costly and time-consuming litigation, expensive licenses or the inability to operate as planned.

The software and technology industries are characterized by the existence of a large number of patents, copyrights, trademarks and trade secrets and by frequent litigation based on allegations of infringement or other violations of intellectual property rights. As we face increasing competition, the possibility of intellectual property rights claims against us may grow. Our services or technologies may not be able to withstand third-party claims or rights restricting their use. Companies, organizations or individuals, including our competitors, may hold or obtain patents or other proprietary rights that would prevent, limit or interfere with our ability to provide our services or develop new services and features, which could make it more difficult for us to operate our business.

If we are determined to have infringed upon a third party’s intellectual property rights, we may be required to pay substantial damages, stop using technologies or services found to be in violation of a third party’s rights or seek to obtain a license from the holder of the infringed intellectual property right, which license may not be available on reasonable terms, or at all, and may significantly increase our operating expenses or may require us to restrict our business activities in one or more respects. We may also be required to develop alternative non-infringing technologies or services that could require significant effort and expense or may not be feasible. In the event of a successful claim of infringement against us and our failure or inability to obtain a license to the infringed technology or service, our busines s and results of operations could be harmed.

Our business will be adversely affected if we are unable to protect our intellectual property rights from unauthorized use or infringement by third-parties.

We rely on a combination of trademark, patent, trade secret and copyright law, license agreements and contractual restrictions, including confidentiality agreements and non-disclosure agreements with employees, contractors and suppliers, to protect our proprietary rights, all of which provide only limited protection.

In addition, effective patent, trademark, copyright and trade secret protection may not be available in every country in which our technologies and services are available. Legal standards relating to the validity, enforceability and scope of protection of intellectual property rights in Internet-related industries are uncertain and still evolving.

Government regulations and legal uncertainties concerning the Internet could hinder our business operations.

Laws applicable to the Internet and online privacy generally are becoming more prevalent. New laws and regulations may be adopted regarding the Internet or other online services in the United States and foreign countries that could limit our business flexibility or cause us to incur higher compliance costs. Such laws and regulations may address:

 
user privacy;
 
 
freedom of expression;
 
 
information security;
 
 
pricing, fees and taxes;
 
 
content and the distribution of content;
 
 
-8-

 
 
intellectual property rights;
 
 
characteristics and quality of products and services;
 
 
taxation; and
 
 
online advertising and marketing, including email marketing and unsolicited commercial email.
 
There can be no assurance that future laws will not impose taxes or other regulations on Internet commerce, which could substantially harm our business, results of operations and financial condition. The nature of such laws and regulations and the manner in which they may be interpreted and enforced is uncertain. The adoption of additional laws or regulations, either domestically and abroad, may decrease the popularity or impede the expansion of Internet marketing, restrict our present business practices, require us to implement costly compliance procedures or expose us and/or our customers to potential liability, which, in turn, could adversely affect our business. Furthermore, the applicability of existing laws to the Internet is unsettled with regard to many important issues, including intellectual property rights, export of encryptio n technology, personal privacy, libel and taxation. It may take years to determine whether and how such existing and future laws and regulations apply to us. If we are required to comply with new regulations or new interpretations of existing regulations, or if we are unable to comply with these regulations, our business could be harmed.

Changes in the legal regulation of the Internet may have specific negative effects on our business and operating results. For example, we may be considered to “operate” or “do business” in states where our customers conduct their business, resulting in regulatory action. Alternatively, we may be subject to claims under state consumer protection statutes if our customers are dissatisfied with the quality of our services, customer referrals or contract cancellation policies. These claims could result in monetary fines or require us to change the manner in which we conduct our business, either of which could adversely affect our business and operating results. Any of these types of claims, regardless of merit, could be time-consuming, harmful to our reputation and expensive to litigate or settle.

The increased security risks of online advertising and e-commerce may cause us to incur significant expenses and may negatively impact our credibility and business.

A significant prerequisite of online commerce, advertising, and communications is the secure transmission of confidential information over public networks. Concerns over the security of transactions conducted on the Internet, consumer identity theft and user privacy have been significant barriers to growth in consumer use of the Internet, online advertising, and e-commerce. A significant portion of our sales is billed directly to our customers’ credit card accounts. We rely on encryption and authentication technology licensed from third parties to effect secure transmission of confidential information. Encryption technology scrambles information being transmitted through a channel of communication to help ensure that the channel is secure even when the underlying system and network infrastructure may not be secure. Authentication t echnologies, the simplest example of which is a password, help to ensure that an individual user is who he or she claims to be by “authenticating” or validating the individual’s identity and controlling that individual’s access to resources. Despite our implementation of security measures, however, our computer systems may be potentially susceptible to electronic or physical computer break-ins, viruses and other disruptive harms and security breaches. Advances in computer capabilities, new discoveries in the field of cryptography or other developments may specifically compromise our security measures. Any perceived or actual unauthorized disclosure of personally identifiable information regarding website visitors, whether through breach of our network by an unauthorized party, employee theft or misuse, or otherwise, could harm our reputation and brands, substantially impair our ability to attract and retain our audiences, or subject us to claims or litigation arising from damages suff ered by consumers, and thereby harm our business and operating results. If consumers experience identity theft after using any of our websites, we may be exposed to liability, adverse publicity and damage to our reputation. To the extent that identity theft gives rise to reluctance to use our websites or a decline in consumer confidence in financial transactions over the Internet, our businesses could be adversely affected. Alleged or actual breaches of the network of one of our business partners or competitors whom consumers associate with us could also harm our reputation and brands. In addition, we could incur significant costs in complying with the multitude of state, federal and foreign laws regarding the unauthorized disclosure of personal information. For example, California law requires companies that maintain data on California residents to inform individuals of any security breaches that result in their personal information being stolen. Because our success depends on the acceptance of online servi ces and e-commerce, we may incur significant costs to protect against the threat of security breaches or to alleviate problems caused by such breaches. Internet fraud has been increasing over the past few years, and fraudulent online transactions, should they continue to increase in prevalence, could also adversely affect the customer experience and therefore our business, operating results and financial condition.
 
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We depend on key management, technical and marketing personnel for continued success.

Our success and future growth depend, to a significant degree, on the skills and continued services of our management team, including Raymond Meyers, our Chief Executive Officer, and Michael Buechler, our Executive Vice president.  Our ongoing success also depends on our ability to identify, hire and retain skilled and qualified technical and Internet marketing personnel in a highly competitive employment market.  As we develop and acquire new products and services, we will need to hire additional employees.  Our inability to attract and retain well-qualified managerial, technical and Internet sales and marketing personnel may have a negative effect on our business, operating results and financial condition.

We may be required to seek additional funding, and such funding may not be available on acceptable terms or at all.
 
We may need to obtain additional funding due to a number of factors beyond our expectations or control, including a shortfall in revenue, increased expenses, increased need for working capital due to growth, increased investment in capital equipment or the acquisition of businesses, services or technologies. If we do need to obtain funding, it may not be available on acceptable terms or at all. If we are unable to obtain sufficient funding, our business would be harmed. Even if we were able to find outside funding sources, we might be required to issue securities in a transaction that could be highly dilutive to our investors or we may be required to issue securities with greater rights than the securities we have outstanding today. We may also be required to take other actions that could lessen the value of our common stock, including b orrowing money on terms that are not favorable to us. If we are unable to generate or raise capital that is sufficient to fund our operations, we may be required to curtail operations, reduce our services, defer or cancel expansion or acquisition plans or cease operations in certain jurisdictions or completely.
 
Risks Related to our Securities

Our common stock is not listed on any stock exchange and may be extremely illiquid.

We intend to seek to list our common stock for quotation on the OTC Bulletin Board. There can be no assurance that the shares will be quoted on the Bulletin Board and, even if quoted, there may be extremely limited or no trading activity.   Accordingly, the shares may be extremely illiquid.

Our common stock may be considered “penny stock”, further reducing its liquidity.

Our common stock may be considered “penny stock”, which will further reduce the liquidity of our common stock.  Our common stock is likely to fall under the definition of “penny stock,” trading in the common stock is limited because broker-dealers are required to provide their customers with disclosure documents prior to allowing them to participate in transactions involving the common stock. These disclosure requirements are burdensome to broker-dealers and may discourage them from allowing their customers to participate in transactions involving our common stock, thereby further reducing the liquidity of our common stock.

"Penny stocks” are equity securities with a market price below $5.00 per share other than a security that is registered on a national exchange, included for quotation on the NASDAQ system or whose issuer has net tangible assets of more than $2,000,000 and has been in continuous operation for greater than three years. Issuers who have been in operation for less than three years must have net tangible assets of at least $5,000,000.

 
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Rules promulgated by the Securities and Exchange Commission under Section 15(g) of the Exchange Act require broker-dealers engaging in transactions in penny stocks, to first provide to their customers a series of disclosures and documents including: 

 
A standardized risk disclosure document identifying the risks inherent in investment in penny stocks;
 
All compensation received by the broker-dealer in connection with the transaction;

 
Current quotation prices and other relevant market data; and o Monthly account statements reflecting the fair market value of the securities.

These rules also require that a broker-dealer obtain financial and other information from a customer, determine that transactions in penny stocks are suitable for such customer and deliver a written statement to such customer setting forth the basis for this determination.

Our directors and executive officers will continue to exert significant control over our future direction, which could reduce the sale value of our Company.

Upon completion of the distribution, members of our Board of Directors and our executive officers will own 65.02% of our outstanding common stock.  Accordingly, these stockholders, if they act together, will be able to control all matters requiring approval of our stockholders, including the election of directors and approval of significant corporate transactions. This concentration of ownership, which could result in a continued concentration of representation on our Board of Directors, may delay, prevent or deter a change in control and could deprive our stockholders of an opportunity to receive a premium for their common stock as part of a sale of our assets.

Investors should not anticipate receiving cash dividends on our common stock, thereby depriving investors of yield on their investment.

We have never declared or paid any cash dividends or distributions on our common stock and intend to retain future earnings, if any, to support our operations and to finance expansion. Therefore, we do not anticipate paying any cash dividends on the common stock in the foreseeable future.  Such failure to pay a dividend will deprive investors of any yield on their investment in our common stock.

Our indemnification of officers and directors and limitations on their liability could limit our recourse against them.

Our Certificate of Incorporation and Bylaws contain broad indemnification and liability limiting provisions regarding our officers, directors and employees, including the limitation of liability for certain violations of fiduciary duties.  Shareholders therefore will have only limited recourse against these individuals.
 
If we fail to implement and maintain proper and effective internal controls and disclosure controls and procedures, our ability to produce accurate and timely financial statements and public reports could be impaired, which could adversely affect our operating results, our ability to operate our business and investors’ views of us.
 
We must ensure that we have adequate internal financial and accounting controls and procedures in place so that we can produce accurate financial statements on a timely basis.  We will be required to spend considerable effort establishing and maintaining our internal controls, which will be costly and time-consuming and will need to be re-evaluated frequently.  We are in the process of documenting, reviewing and, if appropriate, improving our internal controls and procedures in anticipation of being a reporting company and eventually being subject to Section 404 of the Sarbanes-Oxley Act of 2002, which will require annual management assessments of the effectiveness of our internal control over financial reporting.  Under current regulations, we expect that the first year for this assessment will be fiscal 20 11.  As we begin the assessment process in anticipation of being subject to these Section 404 requirements and, as part of that documentation and testing, we may identify areas for further attention and improvement.  We are in the process of developing disclosure controls and procedures designed to ensure that information required to be disclosed by us in our public reports and filings is recorded, processed, summarized and reported within the time periods specified by applicable SEC rules and forms.
 
 
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Implementing any appropriate changes to our internal controls and disclosure controls and procedures may entail substantial costs to modify our existing financial and accounting systems and internal policies, take a significant period of time to complete, and distract our officers, directors and employees from the operation of our business. These changes may not, however, be effective in establishing or maintaining the adequacy of our internal controls or disclosure controls, and any failure to maintain that adequacy, or a consequent inability to produce accurate financial statements or public reports on a timely basis, could materially adversely affect our business. Further, investors’ perceptions that our internal controls or disclosure controls are inadequate or that we are unable to p roduce accurate financial statements may seriously affect the price of our common stock.

We have additional common stock and preferred stock available for issuance, which, if issued, could adversely affect the rights of the holders of our common stock.

Our Certificate of Incorporation authorizes the issuance of up to 25,000,000 shares of our common stock and up to 10,000,000 shares of preferred stock.  The common stock and the preferred stock can be issued by the Board of Directors, without stockholder approval.  Any future issuances of common stock, an increase in the authorized shares of common stock or preferred stock would further dilute the percentage ownership of the Company held by our investors.
 
USE OF PROCEEDS
 
The shares included in this registration statement are currently owned by DSS in connection with our purchase of LegalStore.com and will be distributed pro rata to the shareholders of DSS as of the Record Date. We will not receive any proceeds from the sale of the shares offered by this prospectus.  Accordingly, we will not generate proceeds from this Offering to fund any acquisitions.
 
DETERMINATION OF OFFERING PRICE
 
There is no established public market for the shares of common stock being registered. As a result the offering price of the shares of common stock offered hereby has been arbitrarily determined by us to be $0.001 per share, and does not necessarily bear any relationship to assets, earnings, book value or any other objective criteria of value. In addition, no investment banker, appraiser or other independent third party has been consulted concerning the offering price for the shares or the fairness of the offering price. For purposes of this registration statement and in connection with the distribution, we have based our determination of a value of $.001 per share distributed due to the fact that we are a start-up company with negl igible revenue and there is no market for the common stock we intend to distribute, nor is it quoted or traded on any exchange and is accordingly, highly illiquid.  Moreover, our ability to remain in business requires us to either raise debt or equity capital or generate profitability, none of which can be assured.  We valued the 7.5 million shares issued to DSS that we agreed to register and distribute in order to acquire Legalstore.com at a higher price ($.047 per share) for financial statement purposes because we had no activity or operating assets prior to the acquisition and the cash consideration paid for the common stock issued to the founders prior to the acquisition was based on par value and not a reliable indication of fair value.  Therefore, we determined that the fair value of the interest in LegalStore.com to be a more reliable measure of fair value of the asset purchase for financial statement purposes in accordance with US GAAP.  We did not ut ilize an outside appraisal service, but performed the calculations internally using historical financial information provided by seller. We valued LegalStore.com using a discounted cash flow model.  In determining the value under the discounted cash flow, the Company utilized a growth rate for revenue of 9% in year 2010 and 2011, 7% in 2012 and 6% in 2013 and 2014 and a growth rate for expenses of 9% in 2010, 12% in 2011, and 6% in years 2012 through 2014.  In addition, the Company used a discount rate of 17.85% and a tax rate of 37%.  The discount rate was determined utilizing a weighted average cost of capital approach.

Using the discounted cash flow model method, the fair value of LegalStore.com at time of acquisition was $350,000 or $.047 per IMS share issued ($350,000 divided by 7.5 million shares).

 
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SELLING SECURITY HOLDERS
 
We intend to distribute all 7,500,000 shares currently held by DSS being registered hereby to the DSS shareholders on a pro rata basis.
 
PLAN OF DISTRIBUTION
 
The securities to be registered will be distributed by us to DSS shareholders as of the Record Date on a pro rata basis.
 
Our common stock may be considered “penny stock”, further reducing its liquidity.

Our common stock may be considered “penny stock”, which will further reduce the liquidity of our common stock.  Our common stock is likely to fall under the definition of “penny stock,” trading in the common stock is limited because broker-dealers are required to provide their customers with disclosure documents prior to allowing them to participate in transactions involving the common stock. These disclosure requirements are burdensome to broker-dealers and may discourage them from allowing their customers to participate in transactions involving our common stock, thereby further reducing the liquidity of our common stock.

Penny stocks” are equity securities with a market price below $5.00 per share other than a security that is registered on a national exchange, included for quotation on the NASDAQ system or whose issuer has net tangible assets of more than $2,000,000 and has been in continuous operation for greater than three years. Issuers who have been in operation for less than three years must have net tangible assets of at least $5,000,000.

Rules promulgated by the Securities and Exchange Commission under Section 15(g) of the Exchange Act require broker-dealers engaging in transactions in penny stocks, to first provide to their customers a series of disclosures and documents including: 

 
A standardized risk disclosure document identifying the risks inherent in investment in penny stocks;
 
All compensation received by the broker-dealer in connection with the transaction;

 
Current quotation prices and other relevant market data; and o Monthly account statements reflecting the fair market value of the securities.

DESCRIPTION OF SECURITIES
 
General
 
The following is a summary of information concerning our capital stock. The summary is qualified by our Certificate of Incorporation and bylaws, which you must read for complete information on our capital stock, and which are included as exhibits to the registration statement, of which this prospectus is a part.
 
Common Stock
 
We are authorized to issue 25,000,000 shares of Common Stock, $.001 par value authorized, of which 20,501,000 (including the 7,500,000 shares to be distributed to the DSS shareholders) are issued and outstanding as of March 31, 2010.
 
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Voting Rights
 
Each outstanding share of common stock entitles the holder thereof to one vote per share on matters submitted to a vote of stockholders. Stockholders do not have preemptive rights to purchase shares in any future issuance of our common stock. 
 
The holders of shares of our common stock are entitled to dividends out of funds legally available when and as declared by our Board of Directors. Our Board of Directors has never declared a dividend. Should we decide in the future to pay dividends, it will be at the discretion of the Board of Directors and will be dependent upon then existing conditions, including the Company’s financial condition and the results of operations, capital requirements, contractual restrictions, business prospects, and other factors that the Board of Directors considers relevant. Each share is entitled to the same dividend.  In the event of our liquidation, dissolution or winding up, holders of our common stock are entitled to receive, ratably, the net assets available to stockholders after pay ment of all creditors. 

Preferred Stock

                We are authorized to issue up to 10,000,000 shares of $.001 par value preferred stock in one or more series with such designations, voting powers, if any, preferences and relative, participating, optional or other special rights, and such qualifications, limitations and restrictions, as are determined by resolution of our Board of Directors.  The issuance of preferred stock may have the effect of delaying, deferring or preventing a change in control of our Company without further action by stockholders and could adversely affect the rights and powers, including voting rights, of the holders of common stock.  In certain circumstances, the issuance of preferred stock could depress the market price of the common stock. No share s of preferred stock have been issued.
 
Dividends
 
We have not declared any dividends, and we do not plan to declare any cash dividends in the foreseeable future.
 
Warrants, Options and Convertible Debt
 
There are no outstanding options, warrants or convertible debt.
 
Transfer Agent
 
Our transfer agent is Corporate Stock Transfer, Inc., Denver, Colorado.

Agreements Related To Common Stock Issuance In Connection With Legalstore.com

On October 8, 2009, we acquired from DSS all of the assets and liabilities of Legalstore.com, a division of DSS, in exchange for 7,500,000 shares of our common stock currently held by DSS. In connection with the purchase of Legalstore.com, we also entered into a Registration Rights Agreement and our principal stockholders entered into a Stock Pledge and Escrow Agreement (collectively, the Agreements).  In connection with the Agreements, we are required to file a registration statement on Form S-1, on a best efforts basis, in order to register the 7,500,000 shares of common stock which we intend to distribute pro rata to the DSS shareholders.  These shares are being registered by this prospectus.  Under the Agreements, we are also required to raise at least $200,000 to be used for working capital.  If we fail to secure registration of at least 20% of the 7,500,000 shares of common stock within 360 days of the closing, or fail to meet certain working capital thresholds contained in the purchase agreement, we will be considered to be in default.  In the event of a default, DSS may receive up to an additional 12,500,000 shares of our currently outstanding common stock which will be conveyed to DSS by our two principal shareholders, Messrs. Meyers and Buechler.  These shares are currently held in escrow as collateral.
 
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In addition to the Agreements, our two principal shareholders and DSS have entered into a voting agreement whereby our two principal shareholders agreed to vote all common stock held by them so as to elect two nominees designated by DSS as members of our Board of Directors, which consists of five members.



INTEREST OF NAMED EXPERTS AND COUNSEL

The validity of the securities offered hereby will be passed upon by the Law Office of Gary A. Agron. The financial statements of the Company and the business acquired (Legalstore.com) appearing in this prospectus have been audited by Freed Maxick & Battaglia, CPAs, PC, our independent registered public accounting firm.
 
BUSINESS

Overview

We are an Internet media company that acquires, builds, markets, and monetizes branded Web-based businesses.  We operate our branded Websites within discrete vertical business channels allowing us to utilize cross-promotion marketing activities between our Websites within a channel. Currently, we operate one Website within one business channel, the legal channel.

We use Internet marketing techniques and applications, either developed by us or purchased from a third party, to generate high-quality traffic (visitors) to our Websites. This traffic in turn supports our revenue model which consists of either advertising-based revenue, or sale of a product or service.

We are building our business around the identification, evaluation and cost-effective acquisition of under-valued Websites.  We primarily seek to acquire Web businesses that serve the small and mid-sized businesses since we feel that market segment offers the best opportunity for cost-effective revenue growth. We did not have any operations until our first acquisition in October, 2009 when we acquired our first Web-based business that fit our criteria, the LegalStore.com. We are in the process of building out our first vertical business channel, the legal channel, using LegalStore.com as our anchor Website.

We generate revenue through the sale of products and services via our vertical channel Websites.  Our executive office does not generate revenue and incurs administrative expenses primarily for personnel, rent, utilities, legal, and accounting activities.  Our vertical channel Websites incur expenses for cost of goods, personnel, rent, utilities and general administrative categories.

Our Strategy

Our objective is to build a leading Internet media company consisting of multiple Web-based businesses that offer products or services to small to medium-sized business.  Key elements of our strategy include:

 
·
Continue to target Websites for acquisition that serve the small to medium sized business market segment. We seek to acquire existing Web businesses within vertical channels we believe are currently underdeveloped.  We use an acquisition model that seeks opportunities that have some of the following characteristics: Web-based service offering where the customer accesses our application server via the Internet; defined market segment; cash flow positive (post transaction); undervalued (based on potential growth); in need of automation or process improvement; synergistic to other owned Web businesses; recurring revenue model; scalable model. Web businesses for acquisition will be found through a combination of word of mouth, business brokers, and Internet sites offering Web businesses for sa le.
 
To finance future acquisitions of Web businesses, we will seek to purchase the business using debt or equity financing or through issuance of our common stock.  We cannot assure that we will raise additional debt or equity capital or issue common stock on terms favorable to us or at all.  Our inability to raise capital could require us to delay or eliminate our plans to expand, and would likely impact future revenues.
 
 
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Once a Web business is acquired, we will begin to integrate the business into our current operations starting with the financial areas.  Bank accounts and merchant accounts will be moved under our control, as well as accounts receivable and accounts payable.  We will then analyze the technology requirements necessary to improve the overall operation of the Website.
 
 
·
Develop or acquire marketing services or technologies. We operate Web businesses, and as such, depend on Web-based marketing and technology applications to generate search traffic to our Websites. Once at our Websites, we attempt to convert the traffic into a paying customer.  While we currently utilize marketing solutions through our relationships with other providers such as search engines and third party technology providers, we will seek opportunities either to internally develop some or all of these services and products.
 
 
·
Selling additional products and services to existing customers. We believe we can sell additional products and services once a customer places their first order which can increase our average revenue per customer (measured over a fixed period), and improve our revenue growth.
 
 
·
Strengthening customer retention. We seek to enhance customer retention and build lasting relationships with our customers.  Such efforts begin with our marketing message, continue through the ordering process, and conclude with the fulfillment process.  We believe we can build lasting customer relationships by listening to our customers, consistently examining our internal processes, focusing on customer satisfaction, and offer an expanded product line.
 
    Our Services

Our goal is to develop a diversified and broad range of products and services that are offered through a collection of vertically oriented Websites that target small to medium-sized business.  The products and services we offer through our Websites will first be dependent on the Website offerings at time of acquisition. As we evaluate the potential revenue opportunities associated with the acquired Website, we will expand the products and services offerings to address those opportunities.

We are currently in the build-out phase of our first vertical channel, the legal channel, through our acquisition of the Web business Legalstore.com in October 2009.  Traditionally, LegalStore.com offered legal supplies and print services for the small to medium-size law firms.  We have continued to offer these products and services.  As we identify additional products and services to be offered to our customers in the future we anticipate a product/service development timeframe to be between three and six months measured from the approval by management of the development project to the product/service release to the general public.

Sales and Marketing

Our Websites focus on one specific business channel.  We define a business channel as a business category such as “Automotive”, “Careers”, or “Legal”.   Presently, we have one vertical channel operating, the legal channel, and one Website in production within that channel, www.legalstore.com.
 
 
We sell our products and services primarily through our Websites.  In addition, we provide a toll-free sales number and chat service for our customers that have questions that cannot be answered by using our Website. Orders can be placed through our toll-free sales number but not through our chat service.

For the Legal channel, we market our products and services through search engine positioning, paid-marketing sources including search engine placement, email marketing activities to our current and past customer base on an opt-in basis, and partnerships with other channel providers.
 
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Technology

We implemented a new third-party e-commerce solution for our LegalStore.com Website in October 2009.  Hosted in the data center of the e-commerce provider, the LegalStore.com Website contains over 1500 product codes and over 3,000 customer account records.  In addition, we have off-line access to approximately 10,000 customer account records that are stored on local computers within the LegalStore.com offices in Rochester, NY.

Our First Acquisition – LegalStore.com
 
On October 8, 2009, we entered into an Asset Purchase Agreement with Lester Levin Inc. (“LLI”), a New York corporation and wholly owned subsidiary of Document Security Systems, Inc. (“DSS”), whereby we purchased the assets and liabilities of Legalstore.com (constituting the Business), a division of DSS, in exchange for 7,500,000 shares of common stock of our company.
 
Pursuant to the Asset Purchase Agreement, we agreed to purchase all the assets of Legalstore.com, including, cash and cash equivalents, accounts receivable, inventories, fixed assets, customer lists, and domain names.  In addition to issuing the common stock, we agreed to assume certain liabilities associated with Legalstore.com, including an existing office lease.
 
We accounted for the acquisition in accordance with ASC 805-10 “Business Combinations”, whereby we measured the identifiable assets acquired and liabilities assumed based on the acquisition date fair value.  We are required to recognize and measure any related goodwill acquired in the business combination or a gain from a bargain purchase.  In order to det ermine the goodwill or gain from a bargain purchase, we are required to determine the fair value of the consideration transferred in a business combination.  The fair value is calculated as the sum of the acquisition date fair value of the assets transferred by us, the liabilities incurred by us and the equity interest issued by us.  We had no activity or value prior to the acquisition and the consideration paid for the common stock issued prior to the acquisition was based on par value and not a reliable indication of fair value.  Therefore, we determined that the fair value of the interest in the Business acquired is a more reliable measure.  As a result, we valued the Business acquired using a discounted cash flow model and compared it to the fair value assigned to the identifiable assets and liabilities acquired to determine the amount of goodwill to record in connection with the business combination, which will be deductible for income tax purposes.  In determining the discounted cash flow, we utilized a growth rate for revenue of 9% in year 2010 and 2011, 7% in 2012 and 6% in 2013 and 2014 and a growth rate for expenses of 9% in 2010, 12% in 2011, and 6% in years 2012 through 2014.  In addition, we used a discount rate of 17.85% and a tax rate of 37%.  The discount rate was determined utilizing a weighted average cost of capital approach.
 
In connection with the Asset Purchase Agreement, we and DSS also entered into a Registration Rights Agreement and a Stock Pledge and Escrow Agreement (collectively, the Agreements).  In connection with the Agreements, we are required to file a registration statement on Form S-1, on a best efforts basis, with respect to the 7,500,000 shares of common stock issued pursuant to the terms of the Agreements, as well as raise at least $200,000 to be used for working capital in our company. If we fail to secure registration of at least 20% of the 7,500,000 shares of common stock within 360 days of the closing, and fail to meet certain working capital thresholds contained in the Agreements, then we will be considered to be in default. In the event of a default by us, DSS, Inc may receive up to an additional 12,500,000 shares of our common stock currently issued and outstanding and owned by our two principal shareholders.  These shares are currently held in escrow as collateral.

 
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In addition to the Agreements, our two principal shareholders, DSS and we have entered into a voting agreement whereby our principal shareholders agreed to vote all common stock held by them so as to elect two nominees designated by Lester L evin Inc. or DSS as members of our Board of Directors, which consists of five members.
 
The fair value of assets and liabilities acquired as a result of this business combination were as follows:
 
Fair value of the consideration transferred
  $ 350,000  
         
Fair value of identifiable assets acquired
       
 and liabilities assumed:
       
Accounts receivable
    31,161  
Inventory
    101,011  
Fixed assets
    28,411  
Domain name
    50,000  
Customer list
    120,000  
Total
    330,583  
         
Goodwill
  $ 19,417  
 
The revenue of $111,022 and loss of $(74,172) included in our consolidated statement of operations for the year ended December 31, 2009 consist primarily of Legalstore.com operations from the date of acquisition, October 8, 2009 through December 31, 2009. The unaudited pro forma revenue and loss of the entity if the acquisition had taken place as of January 1, 2008 are as follows:
             
   
Revenue
   
Loss
 
             
Supplemental pro forma from January 1, 2009
           
to December 31, 2009
  $ 470,647     $ (81,252 )
                 
Supplemental pro forma from January 1, 2008
               
to December 31, 2008
  $ 609,807     $ (29,574 )

Competition
 
The markets within our designated vertical channels are highly competitive, and we expect competition to significantly increase in the future.  We compete or intend to compete with a wide variety of companies and Web-based services, including well established Websites.  We also anticipate that a number of companies are or will be attempting to enter the vertical channels we have identified, either directly or indirectly, some of which may become significant competitors in the future.  As we broaden our services and evolve into a multi-channel company, we may be faced with increasing competition within each vertical channel we are in.
 
Some of our competitors have longer operating histories, greater name and brand recognition, larger user bases, significantly greater financial, technical, sales and marketing resources, and engage in more extensive research and development than we do.  We anticipate some of our competitors will also have lower customer acquisition costs than we do and offer a wider variety of services.  If our competitors are more successful than we are in attracting customers, our ability to maintain a large and growing customer base will be adversely affected.
 
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Intellectual Property
 
Our ability to compete is dependent in significant part on our ability to develop and maintain the proprietary aspects of our business and operate without infringing upon the proprietary rights of others. We currently rely primarily on a combination of copyright, trade secret and trademark laws, confidentiality procedures, contractual provisions, and other similar measures to protect our proprietary information. As of March 31, 2010, we do not own any U.S. patents, and we do not have any patent applications pending but not yet issued. Due to the rapidly changing nature of applicable technologies, we believe that the improvement of existing offerings, reliance upon trade secrets and unpatented proprietary know-how and development of new offerings generally will continue to be our principal source of proprietary protection. While we have hired third party contractors to help develop and design some of our websites and applications, we own the intellectual property created by these contractors. The e-commerce software that we currently utilize in our LegalSotre.com business is dependent on commercially available third party software.  While we do not own the software, we do own the processes, procedures, and data that is associated with the use of the e-commerce software.
 
We require all of our employees, contractors and many of those with whom we have business relationships to sign non-disclosure and confidentiality agreements and to assign to us in writing all inventions created while working for us.  In such cases, we have the right to distribute or sublicense the third-party software with our products.
 
When appropriate, we have also entered into nondisclosure agreements with suppliers and business partners to limit access to and disclosure of our proprietary information. Nonetheless, neither the intellectual property laws nor contractual arrangements, nor any of the other steps we have taken to protect our intellectual property can ensure that others will not use our intellectual property.
 
We license, or lease from others, many technologies used in our services. We expect that we and our customers could be subject to third-party infringement claims as the number of websites and third party service providers for Web-based businesses grows. Although we do not believe that our technologies or services infringe the proprietary rights of any third parties, we cannot ensure that third parties will not assert claims against us in the future or that these claims will not be successful.

Government Regulations

The applicability of existing laws to the Internet is unsettled with regard to many important issues, including intellectual property rights, export of encryption technology, personal privacy, libel and taxation. It may take years to determine whether and how such existing and future laws and regulations apply to us. If we are required to comply with new regulations or new interpretations of existing regulations, or if we are unable to comply with these regulations, our business could be harmed.

Laws applicable to the Internet and online privacy generally are becoming more prevalent. New laws and regulations may be adopted regarding the Internet or other online services in the United States and foreign countries that could limit our business flexibility or cause us to incur higher compliance costs. Such laws and regulations may address:  user privacy; freedom of expression; information security; pricing, fees, and taxes; content and distribution of content; intellectual property rights; characteristics and quality of products and services; taxation; and online advertising and marketing, including email marketing and unsolicited commercial email.

There can be no assurance that future laws will not impose taxes or other regulations on Internet commerce, which could substantially harm our business, results of operations and financial condition. The nature of such laws and regulations and the manner in which they may be interpreted and enforced is uncertain. The adoption of additional laws or regulations, either domestically and abroad, may decrease the popularity or impede the expansion of Internet marketing, restrict our present business practices, require us to implement costly compliance procedures or expose us and/or our customers to potential liability, which, in turn, could adversely affect our business.
 
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Changes in the legal regulation of the Internet may have specific negative effects on our business and operating results. For example, we may be considered to “operate” or “do business” in states where our customers conduct their business, resulting in regulatory action. Alternatively, we may be subject to claims under state consumer protection statutes if our customers are dissatisfied with the quality of our services, customer referrals or contract cancellation policies. These claims could result in monetary fines or require us to change the manner in which we conduct our business, either of which could adversely affect our business and operating results. Any of these types of claims, regardless of merit, could be time-consuming, harmful to our reputation and expensive to litigate or settle.

Employees
 
At June 30, 2010, we had five full-time employees, and one part-time employee.  Three of the full-time employees were located at our Rochester, NY location, and the balance of our employees are located at our Santa Monica, CA office.  None of our employees are represented by a labor union or are party to a collective bargaining agreement, and we consider our relationships with our employees to be good.

Facilities
 
We lease approximately 4,000 square feet of office and warehouse space at 320 North Goodman Street, Suite 209, in Rochester, NY for our LegalStore.com business unit for $1,750 per month on a five year lease expiring October 31, 2010.  Our corporate offices are located at 1434 6th Street, Suite 9, Santa Monica, CA and consist of 2,000 square feet under a one year lease for $2,000 per month, which expires January 31, 2011.
 
MARKET PRICE FOR COMMON STOCK AND RELATED
STOCKHOLDER MATTERS
 
There is currently no public trading market for our common stock, and the shares may be illiquid because they are not listed or quoted on any exchange or the OTC Bulletin Board. We intend to apply for quotation of our common stock on the OTC Bulletin Board.  In order to do so, we must identify a brokerage firm willing to make a market in our common stock and to sponsor for us and file an application for our common stock to be quoted on the OTC Bulletin Board.  We can provide no assurance that we will be able to identify such a broker and market maker or satisfy OTC Bulletin Board requirements to list our stock for quotation on the OTC Bulletin Board.  Accordingly, no market for the shares may develop.
 
Upon distribution of the shares included in this registration statement to the DSS shareholders, there will be approximately 5,500 holders of our common stock.  We currently have four stockholders, including DSS who currently holds the 7,500,000 shares of our common stock being registered.
 
We have not declared any cash dividends on our common stock since our inception and do not anticipate doing so in the foreseeable future.
 
We do not have any equity compensation plan.
 
MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
  General

We are an Internet media company that acquires, builds, markets, and monetizes branded Web-based businesses.  We are building our business around the identification, evaluation and cost-effective acquisition of under-valued Websites.  We primarily seek to acquire Web businesses that serve the small and mid-sized businesses since we feel that market segment offers the best opportunity for cost-effective revenue growth.  We operate our branded Websites within discrete vertical business channels allowing us to utilize cross-promotion marketing activities between our Websites within a channel.
 
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We believe our company has progressed beyond the development stage but that our limited revenue causes us to consider our operations to be in an earlier stage of development.  We did not have any operations until our first acquisition in October, 2009 when we acquired our first Web-based business that fit our criteria, the LegalStore.com.  LegalStore.com offers legal supplies, legal forms, and related legal products to the professional community.  We currently operate one Website within one business channel, the legal channel, using LegalSotre.com as our anchor Website.  We continue to look for acquisitions of other under-valued Web-based businesses, both within the Legal channel and outside of that channel, but no acquisitions are currently being discussed or negotiated.  Currently, we d o not have any material commitments for capital expenditures in 2010.

We use Internet marketing techniques and applications, either developed by us or purchased from a third party, to generate high-quality traffic (visitors) to our Website, LegalStore.com.  We also acquire Internet traffic through paid search, comparison shopping websites, and our email marketing efforts.  This traffic in turn supports our revenue model which consists of either advertising-based revenue, or sale of a product or service.  Currently, 100% of our revenue comes from the sale of a product or service through the LegalStore.com Website.  As we continue to develop our business we anticipate realizing advertising revenue.

We do not anticipate the cost of operating our one Website to increase in the next year unless the third-party provider of the e-commerce software we utilize decides to raise their prices.  As of date, we have not received a notice of a price increase.  We anticipate our cost of current marketing activities, on a percentage basis, to remain flat.  Currently, the cost of our marketing activities for our one Website, LegalStore.com, is approximately 8% of revenue.  While we cannot specifically estimate the cost for operational expenses for future Websites we might acquire or develop, we anticipate development, marketing and operational expenses to be approximately in-line with our current development, marketing and operational expenses associated with LegalStore.com.

 To facilitate our future growth through the acquisition of Internet Web-businesses may be required to raise substantial amounts of new financing in the form of additional equity investments, loan financings, or from strategic partnerships.  There can be no assurance that we will be able to obtain additional financing on terms that are acceptable to us and at the time required by us, or at all. Further, any financing may cause dilution of the interests of our current stockholders.  If we are unable to obtain additional equity or loan financing, our financial condition and results of operations will be materially adversely affected.

Results of Operations

For the Quarter Ended March 31, 2010

We did not have any revenue in 2009 until the completion of our acquisition of the LegalStore.com on October 8, 2009.  Accordingly, revenue comparisons in prior periods are not meaningful.  Revenue for the three month period ended March 31, 2010 totaled $154,280.  Costs of revenue for this period totaled $68,207 resulting in a gross profit of $86,073.  During this period we incurred general and administrative operating expenses of $150,090 and selling and marketing expenses of $10,144.  As a result, we had a net loss from operations of $74,161.

For The Year Ended December 31, 2009

We did not have any revenue in 2009 until the completion of our acquisition of the LegalStore.com on October 8, 2009.  Accordingly, revenue comparisons in prior periods are not meaningful.  Revenue for the three month period subsequent to the acquisition date through December 31, 2009 totaled $111,022.  Costs of revenue for this period totaled $80,983 resulting in a gross profit of $30,039.  During this period we incurred general and administrative operating expenses totaling $97,731 and selling and marketing expenses of $6,480  As a result, we had a net loss from operations of $74,172.  The 2009 unaudited pro-forma results of operations had the acquisition occurred January 1, 2009 are presented later in this prospectus.
 
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Liquidity and Capital Resources

At March 31, 2010, we had cash totaling $4,977, accounts receivable of $32,569, inventory of $94,492, and prepaid expenses of $2,641.  Current assets totaled $134,679.  Total assets totaled $343,479.

At March 31, 2010, we had accounts payable of $47,338, accrued expenses of $16,729, and advances from related party of $64,744.  Total current liabilities were $128,811 at March 31, 2010.

At March 31, 2010, we had a working capital surplus of $5,868.

We expect to use our existing cash and revolving line of credit to support our current operations and our efforts to achieve consistent positive cash flow from operations through December 2010, although there is no guarantee we will be able to do so.  We believe we may need to raise funds later this year to address our first six months of 2011 liquidity needs through either a debt or equity offering, although there is no guarantee we will be able to do so.  Our ability to fund operational requirements out of our available cash, cash generated from operations and revolving line of credit depends on a number of factors.  Some of these factors include our ability to (i) increase sales of our existing core products in the Legal channel; and (ii) introduce new prod ucts and services for the legal channel.  Future events, including the problems, delays, expenses and difficulties frequently encountered by similarly situated companies, as well as changes in economic, regulatory or competitive conditions, may lead to cost increases that could have a material adverse effect on us and our plans.  If we cannot generate sufficient cash to fund current operations out of available cash, cash generated from operations and revolving line of credit, we may need to raise additional funds. No assurances can be given that currently available funds will satisfy our working capital needs for the period estimated, or that we can obtain additional working capital through the sale of common stock or other securities, the issuance of indebtedness or otherwise or on terms acceptable to us. Further, no assurances can be given that any such equity financing will not result in a further substantial dilution to the existing stockholders or will be on terms satisfactory to us.

 To facilitate our future growth through the acquisition of Internet Web properties we may be required to raise substantial amounts of new financing in the form of additional equity investments, loan financings, or from strategic partnerships. There can be no assurance that we will be able to obtain additional financing on terms that are acceptable to us and at the time required by us, or at all. Further, any financing may cause dilution of the interests of our current stockholders. If we are unable to obtain additional equity or loan financing, our financial condition and results of operations will be materially adversely affected.

During 2009, our Chief Executive Officer advanced us $23,929 for working capital.  These advances are unsecured, non-interest bearing, and are due on demand.  During the first quarter 2010, additional advances from our Chief Executive Officer of $40,815 for working capital were received by us upon the same terms as the 2009 advances.  The advances are included in current liabilities on our balance sheet as of December 31, 2009 and March 31, 2010, respectively.  On April 8, 2010, the aggregate advances of $64,744 have been formalized with the execution of a $200,000 revolving line of credit agreement between our Chief Executive Officer and us.

Subsequent to March 31, 2010, additional advances from our Chief Executive Officer of $43,927 for working capital were received by us under the April 2010 $200,000 revolving line of credit agreement.  As of June 20, 2010, the outstanding balance of the $200,000 revolving line of credit totaled $108,671.

Critical Accounting Policies
 
The preparation of financial statements and related disclosures in conformity with accounting principles generally accepted in the United States requires management to make judgments, assumptions and estimates that affect the amounts reported in our consolidated financial statements and accompanying notes.  The consolidated financial statement for the fiscal year ended December 31, 2009 describe the significant accounting policies and methods used in the preparation of the consolidated financial statements.  Actual results could differ from those estimates and be based on events different from those assumptions.  Future events and their effects cannot be predicted with certainty; estimating therefore, requires the exercise of judgment. Thus, accounting estimates change as new events occur, as more experi ence is acquired or as additional information is obtained.  The following critical accounting policies are impacted significantly by judgments, assumptions and estimates used in the preparation of our consolidated financial statements:
 
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Accounts Receivable
 
We provide credit in the normal course of business to the majority of our customers.  We perform periodic credit evaluations of our customers’ financial condition and generally we do not require collateral.  We closely monitor outstanding balances and write off amounts we believe are uncollectible after reasonable collection efforts have been made.  To determine if an account receivable allowance was necessary at year-end, we reviewed our accounts receivable aging as well as collections received.  No allowance for doubtful accounts was considered necessary at December 31, 2009 or March 31, 2010.
 
Inventory
 
Inventories consist of legal supplies held for resale and are stated at the lower of cost or market on the first-in, first-out (“FIFO”) method.
 
Fixed Assets
 
We record fixed assets at cost. Depreciation is computed using the straight-line method over the estimated useful lives of the assets. We reviewed the fixed assets additions and determined an appropriate life for each class of asset.  Expenditures for renewals and betterments are capitalized. Expenditures for minor items, repairs and maintenance are charged to operations as incurred.  Any gain or loss upon sale or retirement due to obsolescence is reflected in the operating results in the period the event takes place.
 
Intangible Assets
 
We amortize intangible assets and additions over the estimated useful lives of the assets. As of December 31, 2009 and March 31, 2010 our intangible assets consist of a customer list and domain name acquired pursuant to the asset purchase of LegalStore.com.  Upon obtaining the domain name and customer list, we estimated their useful life to be ten years with a gross carrying amount of $170,000 resulting in an annual amortization cost of $4,250 per year.
 
Long-Lived Assets
 
We review long-lived assets and certain identifiable intangibles for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.  Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to future net undiscounted cash flows expected to be generated by the asset including its ultimate disposition.  If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets.
 
Goodwill
 
Goodwill is the excess of cost of an acquired entity over the fair value of amounts assigned to assets acquired and liabilities assumed in a business combination. We do not amortize goodwill, rather it is tested for impairment annually, and will be tested for impairment between annual tests if an event occurs or circumstances change that would indicate the carrying amount may be impaired. An impairment loss generally would be recognized when the carrying amount of the reporting unit’s net assets exceeds the estimated fair value.  Annually, we determine the fair valve of the reporting unit and compare this amount to the carrying value of the assets.  If the carrying value of the asset exceeds the fair market value, an impairment loss is recorded.  Given the limited activity from the date of acquisition t o December 31, 2009, we determined that nothing significant changed within the business that would result in impairment as of December 31, 2009.
 
Income Tax
 
We account for income taxes with the recognition of estimated income taxes payable or refundable on income tax returns for the current year and for the estimated future tax effect attributable to temporary differences and carryforwards.  Measurement of deferred income items is based on enacted tax laws including tax rates, with the measurement of deferred income tax assets being reduced by available tax benefits not expected to be realized in the immediate future.  We determine if it is more likely than not that the tax attributes making up the deferred tax asset will be utilized prior to expiration.  We reviewed the limited activity that resulted in a net loss and determined there was not sufficient evidence to support the deferred tax asset.
 
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We review tax positions taken to determine if it is more likely than not that the position would be sustained upon examination resulting in an uncertain tax position.  We did not have any material unrecognized tax benefit at December 31, 2009 and March 31, 2010.  We recognize interest accrued and penalties related to unrecognized tax benefits in tax expense.  During the period ended December 31, 2009 and March 31, 2010, we recognized no interest and penalties.
 
Revenue Recognition
 
We recognize revenue for sales of legal products when title of the goods transfers to the customer, either at the time the product is delivered or shipped to the customer based on our agreement with customer.
 
Share-Based Payments
 
We record our common shares issued based on the value of the shares issued or consideration received, including cash, services rendered or other non-monetary assets, whichever is more readily determinable.
 
Business Combination
 
We measured the identifiable assets acquired and liabilities assumed based on the acquisition date fair value.  We are required to recognize and measure any related goodwill acquired in the business combination or a gain from a bargain purchase.  In order to determine the goodwill or gain from a bargain purchase, we are required to determine the fair value of the consideration transferred in a business combination.  The fair value is calculated as the sum of the acquisition date fair value of the assets transferred by us, the liabilities incurred by us and the equity interest issued by us.  We had no activity or value prior to the acquisition and the consideration paid for the common stock issued prior to the acquisition was based on par value and not a reliable indication of fair value. & #160;Therefore, we determined that the fair value of the interest in the Business acquired is a more reliable measure.  As a result, we valued the Business acquired using a discounted cash flow model and compared it to the fair value assigned to the identifiable assets and liabilities acquired to determine the amount of goodwill to record in connection with the business combination, which will be deductible for income tax purposes.  In determining the discounted cash flow, we utilized a growth rate for revenue of 9% in year 2010 and 2011, 7% in 2012 and 6% in 2013 and 2014 and a growth rate for expenses of 9% in 2010, 12% in 2011, and 6% in years 2012 through 2014.  In addition, we used a discount rate of 17.85% and a tax rate of 37%.  The discount rate was determined utilizing a weighted average cost of capital approach.

Off Balance Sheet Arrangements

We do not have any off-balance sheet arrangements.
 
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MANAGEMENT

Directors and Executive Officers
 
Name
Age
Position
Director/Officer Since
       
Raymond J. Meyers
53
Chief Executive Officer, President,
April 2008
   
Treasurer ,and Director
 
       
Michael Buechler
37
Executive Vice President, Secretary,
June 2009
   
and Director
 
       
Alexander A. Orlando
47
Director
April 2008
       
Patrick White
56
Director
October 2009
       
Philip Jones
40
Director
October 2009

The principal occupations for at least the past five years of each of our directors and executive officers are as follows:

Raymond Meyers founded IMS in March 2007 and has been Chief Executive Officer and President since the Company’s inception.  Mr. Meyers founded and operated several technology-based companies, with the most recent one being eBoz, Inc., an Internet marketing tools company, which he operated from November 2001 toApril 2005 and sold to Web.com (NasdaqGM: WWWW), formerly Website Pros, Inc.,  in April 2005.  From April 2005 to December 2006 he was an employee of Web.com holding the position of General Manager, eBoz Division.  He founded our company in March 2007.  He was previously (from December 1996 to December 1999) CEO and President of ProtoSource Corporation, a NASDAQ listed compa ny.  He is a graduate of Rutgers University with continuing education at UCLA.  As a result of his service as our President and Chief Executive Officer since inception, we believe Mr. Meyers provides the board with a deep understanding of all aspects of our business, and therefore should serve on our board.
 
Michael Buechler joined  IMS in March 2009 and is currently its Executive Vice President – Web Properties.  Mr. Buechler co-founded Linkbuddies.com banner exchange in 1998 and operated it until it was sold to iBoost, Inc. in 2000.  LinkBuddies was one of the first banner exchanges in the world.  Mr. Buechler was Vice President – Web Properties at eBoz, Inc., an Internet marketing tools company from 2001 until its sale to Web.com (formerly Website Pros, Inc.) in 2005.  From 2005 to 2008, he was employed by Web.com as Director – Product Strategy and was responsible for product strategy for this NASDAQ listed Web services company.  Mr. Buechler &# 160;is involved with every aspect of our business, including our strategic business planning,  marketing strategies and operations, and therefore we believe should serve on our board.
 
Alexander A. Orlando holds the positions of Chief Financial Officer and Treasurer for Eagle International Institute, Inc. from _March, 2008 to Present.  He was Vice President for eBoz, Inc., an Internet marketing tools company, from January 2000 to December 2007, Senior Executive for ITT Industries-Goulds Pumps from August 1998 to December 1999, General Manager and Controller for Foley-PLP from Jan 1995 to Aug 1998,   Managing Partner of Wagner's Tax and Consulting Services and Owner of several Subway Sandwich Franchises and Real Estate Investments from 1995 to Present.  He is a graduate of Ithaca College with a BS in Finance and Accounting, with continuing education at Geneseo State College.  We believe that Mr. Orlando should serve on our board as he brings to it substantial experience as senior executive in the Internet field and the financial management arena.  
 
Patrick White has been Chief Executive Officer and a Director of Document Security Systems, Inc. (“DSS”) since August 2002. In addition, Mr. White was President of DSS from August 2002 until June 2006 and was Chairman of the Board of Directors of DSS from August 2002 until January 2008.  DSS is an NYSE AMEX listed company. Mr. White received his Bachelors of Science (Accounting) and Masters of Business Administration degrees from Rochester Institute of Technology.  Mr. White is qualified to serve on our board because the skills and experience he has gained in his role as chief executive officer and chairman of a publicly traded company.  
 
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Philip. Jones is a CPA and holds an MBA from Rochester Institute of Technology.  He has 13 years experience in both the public and private accounting and finance sectors, including positions at Arthur Anderson  from 1996 to 1998 and PricewaterhouseCoopers from  2003 to  2004 , American Fiber Systems (Controller) from  2000 to  2003, and 2004 to 2005 , and Zapata (NYSE:ZAP)(Accounting Manager and Director of Finance) from  1998  to  2000 . Mr. Jones joined Document Security Systems, Inc. ("DSS")  in  2005 as its  Corporate Controller and has been its Ch ief Financial Officer since  2009 .  DSS is an NYSE AMEX listed company.  We believe that Mr. Jones having served as a Chief Financial Officer of a publicly traded company brings institutional knowledge to the board, especially in regard to our finances, and therefore should serve on our board.

Term of Office

Directors are elected to hold office until the next annual meeting of shareholders and until their successors are elected and qualified.  Annual meetings of the shareholders, for the selection of directors to succeed those whose terms expire, are held at such time each year as designated by the Board of Directors.  Officers of the Company are elected by the Board of Directors, which is required to consider that subject at its first meeting after every annual meeting of shareholders.  Each officer holds office until his successor is elected and qualified or until his earlier resignation or removal.

Executive Compensation

We do not have employment agreements with our executive officers, Mr. Meyers and Mr. Buechler.  We currently pay Mr. Meyers and Mr. Buechler $3,000 per month each.  We do not have key person life insurance on the lives of any of our executive officers.

The following table discloses compensation received by our Chief Executive Officer and acting Chief Financial Officer, and our Executive Vice-President, also referred to herein as our “named executive officers,” for the fiscal years ended December 31, 2009 and 2008.
 
 
 
Name and Principal Position
 
 
 
Year
 
 
Salary ($)
 
 
Bonus ($)
 
Stock Awards ($)
 
Option Awards ($)
 
All Other Compensation ($)
 
 
Total ($)
Raymond J Meyers,
 
2009
 
(2)
$7,500
 
 
 
 
 
$7,500
Chief Executive Officer, acting Chief Financial Officer
 
2008
(1)
 
 
 
 
 
                             
Michael Buechler,
 
2009
 
(2)
$7,500
 
 
 
 
 
$7,500
Executive Vice President
 
2008
(1)
 
 
 
 
 

 
1.
During 2008, Mr. Meyers and Mr. Buechler were not employees and did not receive any compensation from the Company.
 
2.
During 2009, Mr. Meyers and Mr. Buechler started to receive paid compensation for their services effective October 15, 2009 at a rate of $3,000 per month each.  In 2009, each received $1,500 in October, $3,000 in November, and $3,000 in December.
 
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Director Compensation

Our non-employee directors do not currently receive compensation for their services as directors although they are provided reimbursement for out-of-pocket expenses incurred in attending Board meetings.  We may pay cash and stock-based compensation to our directors in the future.

Board Committees

We do not have any committees of the Board of Directors.  We consider a majority of our Board members (consisting of Messrs. Orlando, White and Jones) to be independent directors under NYSE AMEX rules.

Equity Incentive Plan 

We intend to adopt an equity incentive plan, which we refer to as our Plan, which will provide for the grant of options intended to qualify as “incentive stock options” and “non-statutory stock options” within the meaning of Section 422 of the Internal Revenue Code of 1986, together with the grant of bonus stock and stock appreciation rights, at the discretion of our Board of Directors. Incentive stock options are issuable only to our eligible officers, directors and key employees. Non-statutory stock options are issuable only to our non-employee directors and consultants. We have not determined the aggregate maximum number of shares of common stock or appreciation rights that may be issued under the Plan. The Plan will be administered by our full Board of Directors. Under the Plan, the Board will determine w hich individuals shall receive options, grants or stock appreciation rights, the time period during which the rights may be exercised, the number of shares of common stock that may be purchased under the rights and the option price.

Limitation on Liability and Indemnification of Officers and Directors

Our Certificate of Incorporation provides that liability of directors to us for monetary damages is eliminated to the full extent provided by Delaware law. Under Delaware law, a director is not personally liable to us or our stockholders for monetary damages for breach of fiduciary duty as a director except for liability (i) for any breach of the director’s duty of loyalty to us or our stockholders; (ii) for acts or omissions not in good faith or that involve intentional misconduct or a knowing violation of law; (iii) for authorizing the unlawful payment of a dividend or other distribution on our capital stock or the unlawful purchases of our capital stock; (iv) a violation of Delaware law with respect to conflicts of interest by directors; or (v) for any transaction from which the director derived any improper personal benefit.

The effect of this provision in our Certificate of Incorporation is to eliminate our rights and our stockholders’ rights (through stockholders’ derivative suits) to recover monetary damages from a director for breach of the fiduciary duty of care as a director (including any breach resulting from negligent or grossly negligent behavior) except in the situations described in clauses (i) through (v) above. This provision does not limit or eliminate our rights or the rights of our security holders to seek non-monetary relief, such as an injunction or rescission, in the event of a breach of a director’s duty of care or any liability for violation of the federal securities laws.
 
CORPORATE GOVERNANCE
 
We do not have an audit committee, compensation committee or nominating committee. As we grow and evolve into a SEC registrant, our corporate governance structure is expected to be enhanced.
 
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SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS ND MANAGEMENT
 
As of the date of this prospectus, there are 20,501,000 shares of common stock outstanding, including the 7,500,000 to be distributed to the DSS shareholders. The following table sets forth certain information regarding the beneficial ownership of the outstanding shares as of the date of this prospectus by (i) each person who is known by us to own beneficially more than 5% of our outstanding common stock or holds options on securities convertible into common stock within 60 days from the date hereof; (ii) each of our executive officers and directors; and (iii) all of our executive officers and directors as a group. Except as otherwise indicated, each such person has sole investment and voting power with respect to such shares, subject to community property laws where applicab le. The address of our executive officers and directors is in care of us at 1434 6th Street, Suite 9, Santa Monica, CA 90401.  DSS’ address is 28 Main Street, Suite 1525, Rochester, New York 14614.

 
Name of Beneficial Owner
Shares Beneficially Owned
 
Percentage Beneficially Owned
 
Raymond J. Meyers
9,000,000   43.90 %
Document Security Systems, Inc. (1)
7,500,000   36.58 %
Michael Buechler
4,000,000   19.51 %
Alexander A. Orlando
1,000   % *
Patrick White (2)
320,000   1.7 %
Philip Jones
0   0.0% %
All executive officers and directors
       
as a group (five persons)
13,320,000   64.94 %
         
*Less than 1%
       

(1) Until we complete the distribution to DSS shareholders, these shares are recorded as held of record by DSS. Mr. White is a DSS shareholder.  Mr. White has sole investment and voting power with regard to the DSS shares until we complete the distribution to the shareholders of DSS.
(2) Represents shares to be received upon completion of our distribution of the 7,500,000 shares to the DSS shareholders.  
  
RELATED PARTY TRANSACTIONS
 
During 2009, Raymond Meyers, a principal shareholder and our Chief Executive Officer of the Company, made advances to the Company of $23,929.  The advances are unsecured, non–interest bearing, have no stated repayment terms and are due on demand.  The advances are included in current liabilities in the accompanying balance sheet as of December 31, 2009.  During the first quarter of 2010, additional advances of $40,815 were received from Mr. Meyers by the Company for working capital and upon the same terms as the 2009 advances.  On April 8, 2010, the aggregate advances of $64,744 have been formalized with the execution of a $200,000 revolving line of credit agreement between the Company and our Chief Executive Officer. This credit agreement matu res on April 8, 2011, bears interest at an annual rate of 6% above LIBOR, and is secured by all of our assets.  In the event of default and upon expiration of any applicable cure period, Mr. Meyers, in his sole discretion may request repayment in the form of newly issued common stock of the Company valued at the average closing price of the such common stock for the prior ten business days.
 
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Subsequent to March 31, 2009, additional advances from our Chief Executive Officer of $43,927 for working capital were received by us under the April 2010 $200,000 revolving line of credit agreement between the Company and our Chief Executive Officer.  As of June 20, 2010, the outstanding balance of the $200,000 revolving line of credit totaled $108,671.
 
DISCLOSURE OF COMMISSION POSITION ON INDEMNIFICATION
FOR SECURITIES ACT LIABILITIES
 
The Company provides indemnification for all reasonable actions taken by a director or officer in good faith to the fullest extent permitted under Delaware law.  In addition, under Delaware law, officers and directors are not liable for monetary damages unless an officer’s or director's breach of or failure to perform duties as a director constitutes a violation of the criminal law or involves a transaction from which the director derived an improper personal benefit either directly or indirectly.
 
           Insofar as indemnification for liabilities arising under the Securities Act may be available to directors, officers and controlling persons of the Registrant pursuant to any provision or otherwise, the Registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable.
 
WHERE YOU CAN FIND MORE INFORMATION
 
We have filed a registration statement on Form S-1 with the SEC with respect to the shares of our common stock being registered hereunder. This prospectus, which is a part of such registration statement, does not include all of the information that you can find in such registration statement or the exhibits to such registration statement. You should refer to the registration statement, including its exhibits and schedules, for further information about us and our common stock. Statements contained in this prospectus as to the contents of any contract or document are not necessarily complete and, if the contract or document is filed as an exhibit to a registration statement, is qualified in all respects by reference to the relevant exhibit.
 
After the distribution, we will file annual, quarterly and current reports, proxy statements and other information with the SEC. The registration statement is, and any of these future filings with the SEC will be, available to the public over the Internet on the SEC's website at www.sec.gov . You may read and copy any filed document at the SEC's public reference rooms in Washington, D.C. at 100 F Street, N.E., Washington, D.C. 20549 and at the SEC's regional offices. Please call the SEC at 1-800-SEC-0330 for further information about the public reference rooms.
 
-29-

 
 
 
 
 
 
 
 
 
 
 
INTERNET MEDIA SERVICES, INC.
FINANCIAL STATEMENTS
 
MARCH 31, 2010
 
 
 
 
 
 
 
 
 
 
 
F-1

 

 
INTERNET MEDIA SERVICES, INC.

CONTENTS
 
   
 
Page
   
Consolidated Financial Statements:
 
   
Balance Sheet
F-3
   
Statement of Operations
F-4
   
Statement of Cash Flows
F-5
   
   
Notes to the Consolidated Financial Statements
F-6
 
 
 
 
 
 

 
 
F-2

 
INTERNET MEDIA SERVICES, INC.
 
BALANCE SHEET
March 31, 2010
(Unaudited)
     
       
       
ASSETS
     
       
Current assets:
     
Cash
  $ 4,977  
Accounts receivable
    32,569  
Inventory
    94,492  
Prepaid expenses
    2,641  
Total current assets
    134,679  
         
Property and equipment, net
    25,433  
         
Other intangibles, net
    161,500  
         
Goodwill
    19,417  
         
Other assets
    2,450  
         
Total assets
  $ 343,479  
         
LIABILITIES AND STOCKHOLDERS' EQUITY
       
         
Current liabilities:
       
Accounts payable
  $ 47,338  
Accrued expenses
    16,729  
Advances from related party
    64,744  
Total current liabilities
    128,811  
         
Stockholders' equity
       
Common stock, $.001 par value, 25,000,000 shares authorized,
       
20,501,000 shares issued and outstanding
    20,501  
Additional paid in capital
    342,500  
Accumulated deficit
    (148,333 )
      214,668  
         
Total liabilities and stockholders' equity
  $ 343,479  
 
See accompanying notes.
 
 
F-3

 
 
INTERNET MEDIA SERVICES, INC.
 
STATEMENT OF OPERATIONS
For the Three Months Ended March 31, 2010
(Unaudited)
     
       
       
Revenue
  $ 154,280  
         
Costs of revenue
    68,207  
         
Gross profit
    86,073  
         
Operating expenses:
       
General and administrative
    150,090  
Selling and marketing
    10,144  
      160,234  
         
         
Net loss
  $ (74,161 )
         
Loss per share - basic and diluted
  $ (0.00 )
         
Weighted average common shares outstanding - basic and diluted
    20,501,000  
 
See accompanying notes.
 
 
F-4

 
 
INTERNET MEDIA SERVICES, INC.
 
STATEMENT OF CASH FLOWS
For the Three Months Ended March 31, 2010
(Unaudited)
   
       
       
Cash flows from operating activities:
     
Net loss
  $ (74,161 )
Adjustments to reconcile net loss to net
       
  cash used by operating activities:
       
Depreciation and amortization
    5,739  
(Increase) decrease in assets:
       
Accounts receivable
    677  
Inventory
    (3,663 )
Prepaid expenses and other assets
    160  
Increase in liabilities:
       
Accounts payable and accrued expenses
    27,633  
Net cash used by operating activities
    (43,615 )
         
Cash flows from financing activities:
       
Net advances from related party
    40,815  
Net cash provided by financing activities
    40,815  
         
Net decrease in cash
    (2,800 )
         
Cash - beginning of year
    7,777  
         
Cash - end of year
  $ 4,977  
 
See accompanying notes.
 
 
F-5

 
NOTE 1. - BASIS OF PRESENTATION

The accompanying unaudited consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles for interim financial information. Accordingly, these statements do not include all of the information and footnotes required by U.S. generally accepted accounting principles for complete financial statements. In the opinion of management, the accompanying balance sheets and related interim statements of operations and cash flows include all adjustments, consisting only of normal recurring items, necessary for their fair presentation in accordance with U.S. generally accepted accounting principles. All significant intercompany transactions have been eliminated.

Interim results are not necessarily indicative of results expected for a full year. For further information regarding Internet Media Services, Inc. (the “Company”) accounting policies, refer to the audited consolidated financial statements and footnotes thereto for the fiscal year ended December 31, 2009.

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ materially from those estimates and assumptions. In preparing these financial statements, the Company has evaluated events and transactions for potential recognition or disclosure.
 
The material operations of the Company began on October 8, 2009 with the acquisition of LegalStore.com. Accordingly, there are no comparitive March 31, 2009 financial statements presented.
 
Fair Value of Financial Instruments - Fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management as of March 31, 2010. The carrying amounts reported in the balance sheet as of March 31, 2010 of cash and cash equivalents, accounts receivable, accounts payable and accrued expenses approximate fair value because of the immediate or short-term maturity of these financial instruments. The fair value of revolving credit lines, notes payable and long-term debt approximates their carrying value as the stated or discounted rates of the debt reflect recent market conditions.

NOTE 2. - RELATED PARTY CREDIT AGREEMENT

During 2009 and the first quarter of 2010 Mr. Raymond Meyers, a shareholder and chief executive officer of the Company, made advances to the Company for working capital needs. As of March 31, 2010, outstanding advances payable to Mr. Meyers amounted to $64,744. The advances were unsecured, non-interest bearing, had no stated repayment terms and were due on demand. On April 8, 2010, the aggregate advances were formalized with the execution of a $200,000 revolving credit agreement. Subsequent to March 31, 2010, Mr. Meyers made additional advances in the amount of $43,927. This credit agreement matures on April 8, 2011, bears interest at an annual rate of 6% above LIBOR, and is secured by all of the assets of the Company. In the event of default and upon the expiration of any applicable cur e period, Mr. Meyers, in his sole discretion may request repayment in the form of newly issued common stock of the Company.  Under the terms of the agreement the Company is required to comply with various covenants.

NOTE 3. - STOCKHOLDERS’ EQUITY

On April 8, 2010, the Company approved for issuance up to 10,000,000 shares of $.001 par value preferred stock.  The rights and preferences of the preferred stock will be determined by board resolution upon issuance.  There are no preferred shares issued and outstanding.
 
F-6

 
 

FINANCIAL STATEMENTS

INTERNET MEDIA SERVICES, INC.


DECEMBER 31, 2009
with
REPORT OF INDEPENDENT REGISTERED PUBLIC
ACCOUNTING FIRM

INTERNET MEDIA SERVICES, INC.

CONTENTS

 
 
Page
   
Report of Independent Registered Public Accounting Firm
F-8
   
   
Consolidated Financial Statements:
 
   
Balance Sheet
F-9
Statement of Operations and Accumulated Deficit
F-10
Statement of Stockholders’ Equity
F-11
Statement of Cash Flows
F-12
   
Notes to the Consolidated Financial Statements
F-13 - F-17
 


 
F-7

 

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM


To the Board of Directors and Stockholders
Internet Media Services, Inc. and Subsidiary


We have audited the accompanying consolidated balance sheet of Internet Media Services, Inc. and Subsidiary as of December 31, 2009, and the related consolidated statements of operations, stockholders’ equity, and cash flows for the year then ended.  These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States).  Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement.  The Company is not required to have, nor have we been engaged to perform, an audit of its internal control over financial reporting.  Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly we express no such opinion.  An audit includes examining, on a test basis, evidence supportin g 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 audit provides a reasonable basis for our opinion.

As discussed in the restatement paragraph within Note 1 to the consolidated financial statements, Internet Media Services, Inc. has updated its previously issued 2009 financial statements to present major expense line items by functional category and earnings per share along with weighted average number of common shares outstanding on the statements of operations, include the statement of stockholders’ equity and revise certain footnote disclosures as required by accounting principles generally accepted in the United States of America.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Internet Media Services, Inc. and Subsidiary as of December 31, 2009, and the results of its operations and its cash flows for the year then ended, in conformity with U.S. generally accepted accounting principles.


/s/ FREED MAXICK & BATTAGLIA, CPAs, PC

Buffalo, New York
April 9, 2010, except for items disclosed in Note 1 regarding restatement, as to which the date is June 30, 2010
 
F-8

 
INTERNET MEDIA SERVICES, INC.
 
   
CONSOLIDATED BALANCE SHEET
 
December 31, 2009
 
   
       
       
       
ASSETS
     
       
Current assets:
     
Cash
  $ 7,777  
Accounts receivable
    33,246  
Inventory
    90,829  
Prepaid expenses
    5,251  
Total current assets
    137,103  
         
Property and equipment, net
    26,922  
Other intangibles, net
    165,750  
Goodwill
    19,417  
         
Total assets
  $ 349,192  
         
LIABILITIES AND STOCKHOLDERS' EQUITY
       
         
Current liabilities:
       
Accounts payable
  $ 26,653  
Accrued expenses
    9,781  
Advances from related party
    23,929  
Total current liabilities
    60,363  
         
Stockholders' equity
       
Common stock, $.001 par value, 25,000,000 shares authorized,
       
20,501,000 shares issued and outstanding
    20,501  
Additional paid in capital
    342,500  
Accumulated deficit
    (74,172 )
      288,829  
         
Total liabilities and stockholders' equity
  $ 349,192  

See accompanying notes.
 
F-9

 
INTERNET MEDIA SERVICES, INC.
 
   
CONSOLIDATED STATEMENT OF OPERATIONS
 
For the Year Ended December 31, 2009
 
   
       
       
       
       
Revenue
  $ 111,022  
         
Cost of sales
    80,983  
         
Gross profit
    30,039  
         
Operating expenses:
       
General and administrative
    97,731  
Selling and marketing
    6,480  
      104,211  
         
Net loss
  $ (74,172 )
         
Loss per share - basic and diluted
  $ (0.00 )
         
Weighted average common shares outstanding - basic and diluted
    20,501,000  

 

See accompanying notes.
 
F-10

 
INTERNET MEDIA SERVICES, INC.
 
   
CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
 
For the Year Ended December 31, 2009
 
                           
                               
               
Additional
         
Total
 
   
Shares
   
Common
 
Paid-in
   
Accumulated
 
Stockholders'
 
   
Outstanding
 
Stock
   
Capital
   
Deficit
   
Equity
 
                               
Balance at December 31, 2008
    -     $ -     $ -     $ -     $ -  
                                         
Common stock issued to founders
    13,001,000       13,001       -       -       13,001  
                                         
Common stock issued to acquire Legalstore.com
    7,500,000       7,500       342,500       -       350,000  
                                         
Net loss
    -       -       -       (74,172 )     (74,172 )
                                         
Balance at December 31, 2009
    20,501,000     $ 20,501     $ 342,500     $ (74,172 )   $ 288,829  
 
 
See accompanying notes.
 
F-11

 
INTERNET MEDIA SERVICES, INC.
 
   
CONSOLIDATED STATEMENT OF CASH FLOWS
 
For the Year Ended December 31, 2009
 
   
       
       
       
Cash flows from operating activities:
     
Net loss
  $ (74,172 )
Adjustments to reconcile net loss to net
       
  cash used by operating activities:
       
Depreciation and amortization
    5,739  
(Increase) decrease in assets:
       
Accounts receivable
    (2,085 )
Inventory
    10,182  
Prepaid expenses
    (5,251 )
Increase in liabilities:
       
Accounts payable and accrued expenses
    36,434  
Net cash used by operating activities
    (29,153 )
         
Cash flows from financing activities:
       
Advances from related party
    23,929  
Proceeds from sale of common stock
    13,001  
Net cash provided by financing activities
    36,930  
         
         
Cash - end of year
  $ 7,777  
         
Non-cash investing and financing activities during the year
       
         
Acquisition of the business through issuance of common stock
  $ 350,000  
 
See accompanying notes.

 
 
F-12

 
 
NOTE 1. – NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Nature of Business - Internet Media Services, Inc. (the Company) is in the business of acquiring, building and monetizing internet web properties through the acquisition of existing web properties in vertical business channels identified by management and using these web properties as an anchor to build within that vertical market.  On October 8, 2009, the Company completed its first acquisition in the legal vertical market through the purchase of the assets and assumption of certain liabilities of Legalstore.com (see Note 2).  Legalstore.com is an internet based company that primarily sells legal supplies and legal forms, including security paper.  The Company also sells products and supplies for use in the medical and educationa l fields.  The Company was incorporated on March 26, 2007 and did not have operations until the acquisition in 2009.

Principles of Consolidation - The consolidated financial statements include the accounts of Internet Media Services, Inc. and its wholly-owned subsidiary (Legalstore.com, Inc.).  All intercompany balances and transactions have been eliminated in consolidation.

Use of Estimates - The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates and be based on events different from those assumptions. Future events and their effects cannot be predicted with certainty; estimating, therefore, requires the exercise of judgment. Thus, accounting estimates change as new events occur, as more experience is acquired or as additional information is obtained.

Accounts Receivable - The Company provides credit in the normal course of business to the majority of its customers.  The Company performs periodic credit evaluations of its customers’ financial condition and generally does not require collateral.  Management closely monitors outstanding balances and writes off amounts that it believes are uncollectible after reasonable collection efforts have been made.  No allowance for doubtful accounts was considered necessary at December 31, 2009.The Company does not accrue interest on past due accounts receivable.

Inventory - Inventories consist of legal supplies held for resale and are stated at the lower of cost or market on the first-in, first-out (“FIFO”) method.

Fixed Assets - Fixed assets are recorded at cost. Depreciation is computed using the straight-line method over the estimated useful lives of the assets. Expenditures for renewals and betterments are capitalized. Expenditures for minor items, repairs and maintenance are charged to operations as incurred.  Any gain or loss upon sale or retirement due to obsolescence is reflected in the operating results in the period the event takes place.

Intangible Assets - Intangible assets consist of a customer list and domain name acquired pursuant to the asset purchase agreement (see Note 2).

    Gross    
Net Carrying
   
Accumulated
   
Carrying
 
   
Useful life
   
Amount
   
Amortization
   
Cost
 
                         
Domain name
    10     $ 50,000     $ 1,250     $ 48,750  
Customer list
    10       120,000       3,000       117,000  
Total
          $ 170,000     $ 4,250      165,750  

 
F-13

 
 
NOTE 1. – NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Amortization expense related to these intangible assets amounted to $4,250 for the year ended December 31, 2009.  The expected future amortization expense for the next five years is $17,000 per year.

Impairment of Long-Lived Assets - The Company reviews long-lived assets and certain identifiable intangibles for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.  Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to future net undiscounted cash flows expected to be generated by the asset including its ultimate disposition.  If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets.

Goodwill - Goodwill is the excess of cost of an acquired entity over the fair value of amounts assigned to assets acquired and liabilities assumed in a business combination. The Company does not amortize goodwill, rather it is tested for impairment annually, and will be tested for impairment between annual tests if an event occurs or circumstances change that would indicate the carrying amount may be impaired. An impairment loss generally would be recognized when the carrying amount of the reporting unit’s net assets exceeds the estimated fair value.  The Company performs annual assessments of potential impairment and has determined that no impairment is necessary as of December 31, 2009.

Income Taxes – The Company accounts for income taxes with the recognition of estimated income taxes payable or refundable on income tax returns for the current year and for the estimated future tax effect attributable to temporary differences and carryforwards.  Measurement of deferred income items is based on enacted tax laws including tax rates, with the measurement of deferred income tax assets being reduced by available tax benefits not expected to be realized in the immediate future.

The Company reviews tax positions taken to determine if it is more likely than not that the position would be sustained upon examination resulting in an uncertain tax position.  The Company did not have any material unrecognized tax benefit at December 31, 2009.  The Company recognizes interest accrued and penalties related to unrecognized tax benefits in tax expense.  During the year ended December 31, 2009, the Company recognized no interest and penalties.

The Company files U.S. federal tax returns and tax returns in various states.  The tax years 2007 through 2009 remain open to examination by the taxing jurisdictions to which the Company is subject.

Common Shares Issued - Common shares issued are recorded based on the value of the shares issued or consideration received, including cash, services rendered or other non-monetary assets, whichever is more readily determinable.

Revenue Recognition - Revenue is recognized for sales of legal products when title of the goods transfers to the customer, either at the time the product is delivered or shipped to the customer based on our agreement with customer.

 
F-14

 
 
NOTE 1. – NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Fair Value of Financial Instruments - The Company discloses fair value information about financial instruments. Fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management as of December 31, 2009.
 
These financial instruments include cash, accounts receivable, accounts payable, accrued liabilities and short term advances. Fair values were assumed to approximate carrying values for these financial instruments since they are short-term in nature and their carrying amounts approximate fair values or they are receivable or payable on demand. The fair value of the short term advances is estimated based upon the carrying value which approximates the fair value of the advance.

Advertising Costs- Generally consist of online, keyword advertising with various search engines with additional amounts spent on certain targeted advertising.   Advertising costs are expensed as incurred and amounted to approximately $6,500 for the year ended December 31, 2009.

Earnings Per Common Share - The Company presents basic earnings per share.  Basic earnings per share reflects the actual weighted average of shares issued and outstanding during the period. There are no dilutive or potentially dilutive instruments outstanding as of December 31, 2009.

Restatement - Subsequent to the original issuance of the financial statements, it was determined that certain disclosures required by accounting principles generally accepted in the United States (GAAP) were omitted.  These financial statements have been restated to present major expense line items by functional category and earnings per share along with weighted average number of common shares outstanding on the statement of operations, include a statement of stockholders’ equity, as well as add and revise certain footnote disclosures required by GAAP.  The footnote disclosures restatements made are as follows:

 
Ø
Note 1 was restated to include accounting policies related to the fair value of common shares issued and earnings per share, as well as modify and expand the accounting policy related to revenue recognition.
 
 
Ø
Note 2 was expanded to include assumptions used in determining the fair value of assets purchased and liabilities assumed under the discounted cash flow model and to provide supplemental pro forma information on the revenue and earnings of the combined entity for the current and prior reporting period.
 
 
Ø
Note 3 was restated to include the estimated useful life for each major class of fixed asset presented.
 
 
Ø
Note 4 was expanded to include the method and assumptions used in determining the fair value of stock issued to founders.
 
 
Ø
Note 5 was revised to clarify the identity of the stockholder who provided advances to the Company as Mr. Raymond Meyers and updated for additional advances subsequent to December 31, 2009.

 
F-15

 
NOTE 1. – NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

There were no changes to the balance sheet, earnings, statement of cash flows, or equity of the Company as a result of these restatements.  The financial statements have not been updated to reflect subsequent events since the date of the original issuance of the financial statements.

NOTE 2. – ACQUISITION OF BUSINESS

On October 8, 2009, the Company entered into an Asset Purchase Agreement with Lester Levin Inc. (“LLI”), a New York corporation and wholly owned subsidiary of Document Security Systems, Inc. (“DSS”), whereby the Company purchased the assets and liabilities of Legalstore.com (constituting the Business), a division of DSS, in exchange for 7,500,000 shares of common stock of the Company.

Pursuant to the Asset Purchase Agreement, the Company agreed to purchase all the assets of Legalstore.com, including, cash and cash equivalents, accounts receivable, inventories, fixed assets, customer lists, and domain names.  In addition to issuing the common stock, the Company agreed to assume certain liabilities associated with Legalstore.com, including an existing office lease.

The Company accounted for the acquisition in accordance with ASC 805-10 “Business Combinations”, whereby the Company measured the identifiable assets acquired and liabilities assumed based on the acquisition date fair value.  The Company is required to recognize and measure any related goodwill acquired in the business combination or a gain from a bargain purchase.  In order to determine the goodwill or gain from a bargain purchase, the Company is required to determine the fair value of the consideration transferred in a business combination.  The fair value is calculated as the sum of the acquisition date fair value of the assets transferred by the Company, the liabilities incurred by the Company and the equity interest issued by the Company. 60; The Company had no activity or value prior to the acquisition and the consideration paid for the common stock issued prior to the acquisition was based on par value and not a reliable indication of fair value.  Therefore, the Company determined that the fair value of the interest in the Business acquired is a more reliable measure.  As a result, the Company valued the Business acquired using a discounted cash flow model and compared it to the fair value assigned to the identifiable assets and liabilities acquired to determine the amount of goodwill to record in connection with the business combination, which will be deductible for income tax purposes.  In determining the discounted cash flow, the Company utilized a growth rate for revenue of 9% in year 2010 and 2011, 7% in 2012 and 6% in 2013 and 2014 and a growth rate for expenses of 9% in 2010, 12% in 2011, and 6% in years 2012 through 2014.  In addition, the Company used a discount rate of 17.85% and a tax rate of 37%.  The discount rate was determined utilizing a weighted average cost of capital approach. All the operations of the Business are included in the accompanying statement of operations beginning with the date of the Asset Purchase Agreement.

In connection with the Asset Purchase Agreement, the Company and a majority shareholder of the Company also entered into a Registration Rights Agreement and a Stock Pledge and Escrow Agreement (collectively, the Agreements).  In connection with the Agreements, the Company is required to file a registration statement on Form S-1, on a best efforts basis, with respect to the 7,500,000 shares of common stock issued pursuant to the terms of the Agreements, as well as raise at least $200,000 to be used for working capital in the Company. If the Company fails to secure registration of at least 20% of the 7,500,000 shares of common stock within 360 days of the closing, and fails to meet certain working capital thresholds contained in the Agreements, then the Company will be considered to be in default. In the event of a default by the Company, Document Security Systems, Inc may receive up to an additional 12,500,000 shares of the Company’s Common Stock currently issued and outstanding and owned by the principal shareholders.  These shares are currently held in escrow as collateral.

In addition to the Agreements, the Company’s principal shareholders, the Company and Document Security Systems, Inc entered into a voting agreement whereby the principal shareholders of the Company agreed to vote all common stock held by them so as to elect two nominees designated by Lester Levin Inc. or Document Security Systems, Inc as members of the Company’s Board of Directors, which consists of five members.

The fair value of assets and liabilities acquired as a result of this business combination were as follows:

Fair value of the consideration transferred
  $ 350,000  
         
Fair value of identifiable assets acquired
       
 and liabilities assumed:
       
Accounts receivable
    31,161  
Inventory
    101,011  
Fixed assets
    28,411  
Domain name
    50,000  
Customer list
    120,000  
Total
    330,583  
         
Goodwill
  $ 19,417  
 
 
F-16

 
The revenue of $111,022 and loss of $(74,172) included in the Company's consolidated statement of operations for the year ended December 31, 2009 consist primarily of Legalstore.com operations. The unaudited pro forma revenue and loss of the entity if the acquisition had taken place as of January 1, 2008 are as follows:

   
Revenue
   
Loss
 
             
Supplemental pro forma from January 1, 2009
           
to December 31, 2009   $ 470,647     $ (81,252 )
                 
Supplemental pro forma from January 1, 2008
               
to December 31, 2008
  $ 609,807     $ (29,574 )

NOTE 3. - FIXED ASSETS
 
Fixed assets consist of the following at December 31, 2009:

 
  Estimated
     
 
 Useful Life
     
         
Machinery and equipment
1 to 5 years
  $ 18,050  
Furniture and fixtures
5 to 7 years
    7,820  
Leasehold improvements
3 to 5 years
    2,541  
        28,411  
Less: accumulated depreciation
      (1,489 )
           
      $ 26,922  

Depreciation expense was $1,489 for the year ended December 31, 2009.

NOTE 4. - STOCKHOLDERS’ EQUITY

During the year ended December 31, 2009, the Company issued 13,001,000 shares of common stock to the founders in exchange for $13,001. The amount of cash consideration paid was determined based on the par value of the shares issued.  Given the absence of a “regular, active public market”, and no previous sales of the Company common stock, the Company determined the fair value of the initial 13,001,000 shares sold to be the consideration paid.  The Company took the following into consideration in making this determination; the Company had no transactions or activity prior to and immediately subsequent the initial stock sale and the Company was an inactive shell during this time period.

Subsequent to December 31, 2009, the Company approved for issuance up to 10,000,000 shares of $.001 par value preferred stock.  The rights and preferences of the preferred stock will be determined by board resolution upon issuance.  As of April 9, 2010, no preferred shares have been issued.

NOTE 5. - ADVANCES FROM RELATED PARTY

During 2009, Mr. Raymond Meyers, a shareholder and chief executive officer of the Company, advanced the Company $23,929 for working capital needs.   The advances were unsecured, non-interest bearing, had no stated repayment terms and were due on demand.  The advances are included in current liabilities in the accompanying balance sheet as of December 31, 2009.  Subsequent to December 31, 2009, additional advances net of repayments amounting to  $84,742 were received from Mr. Meyers by the Company.  On April 8, 2010, the aggregate advances were formalized with the execution of a $200,000 revolving credit agreement.  This credit agreement matures on April 8, 2011, bears interest at an annual rate of 6% above LIBOR, and is sec ured by all of the assets of the Company.

NOTE 6. - INCOME TAXES

Following is a summary of the components giving rise to the income tax provision (benefit) for the year ended December 31, 2009:

Deferred:
     
Federal
    (24,071 )
State
    (4,964 )
Total deferred
    (29,035 )
         
Less increase in allowance
    29,035  
Net deferred
       
Total income tax provision
  $ -  
         
Individual components of deferred taxes are as follows as of December 31, 2009:
       
         
Deferred tax assets:
       
Net operating loss carryforwards
  $ 28,182  
Depreciable and amortizable assets
    853  
Total
    29,035  
Less valuation allowance
    (29,035 )
         
Gross deferred tax assets
  $ -  
         
 
The Company has approximately $68,700 in net operating loss carryforwards (“NOL’s”) available to reduce future taxable income.  These carryforwards begin to expire in year 2029.  Due to the uncertainty as to the Company’s ability to generate sufficient taxable income in the future and utilize the NOL’s before they expire, the Company has recorded a valuation allowance to reduce the net deferred tax asset to zero.  The difference between the statutory federal tax rate and the effective tax rate is due to the state income tax rate and the change in the valuation allowance.

NOTE 7. - COMMITMENTS

Facilities - The Company leases office and warehouse space with a monthly rental of $1,740. This lease was assumed by the Company according to the asset purchase agreement as discussed in Note 2.  Lease expense for year ended December 31, 2009 was $3,740.  The lease expires in October 2010, although renewal options exist to extend lease agreements.  Subsequent to December 31, 2009, the Company entered into a second lease for corporate office space, which requires monthly payments of $2,000 and expires on January 31, 2011.  Total approximate future lease commitments under both of these leases are as follows:

 
2010
$39,400
 
2011
$2,000
 
F-17

 
 
 
 
 
 
 
 
 
FINANCIAL STATEMENTS
LEGALSTORE.COM
(A DIVISION OF DOCUMENT SECURITY SYSTEMS, INC.)

OCTOBER 8, 2009
with
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
 
 
 
 
 

 
 
F-18

 
LEGALSTORE.COM
(A DIVISION OF DOCUMENT SECURITY SYSTEMS, INC.)

CONTENTS






 
Page
   
Report of Independent Registered Public Accounting Firm
F-20
   
   
Carve-Out Financial Statements:
 
Balance Sheet
F-21
Statement of Operations
F-22
Statement of Changes in Divisional Equity
F-23
Statement of Cash Flows
F-24
   
   
Notes to the Carve-Out Financial Statements
F-25 - F-31

 
 
 
 

 
 
F-19

 
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM


To the Board of Directors of
Document Security Systems, Inc.
 
 
We have audited the accompanying carve-out balance sheet of Legalstore.com (a division of Document Security Systems, Inc.) as of October 8, 2009, and the related carve-out statements of operations, cash flows and changes in divisional equity for the period from January 1, 2009 through October 8, 2009. These financial statements are the responsibility of Legalstore.com’s management. Our responsibility is to express an opinion on these carve-out financial statements based on our audit.
 
We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States).  Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement.  Legalstore.com is not required to have, nor have we been engaged to perform, an audit of its internal control over financial reporting.  Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of Legalstore.com’s internal contro l over financial reporting.  Accordingly we express no such opinion.  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 audit provides a reasonable basis for our opinion.
 
In our opinion, the financial statements referred to above present fairly, in all material respects, the carve-out financial position of Legalstore.com (a division of Document Security Systems, Inc.) as of October 8, 2009, and the results of its carve-out operations, cash flows and changes in divisional equity for the period from January 1, 2009 through October 8, 2009, in conformity with U.S. generally accepted accounting principles.
 
As discussed in Notes 1and 8 to the carve-out financial statements, on October 8, 2009 Document Security Systems, Inc. entered into an asset purchase agreement to sell the assets associated with Legalstore.com (a division of Document Security Systems, Inc.).
 
 
/s/ FREED MAXICK & BATTAGLIA, CPAs, PC
 
Buffalo, New York
June 30, 2010

 
F-20

 
LEGALSTORE.COM
(A DIVISION OF DOCUMENT SECURITY SYSTEMS, INC.)
 
CARVE-OUT BALANCE SHEET
October 8, 2009
     
       
       
ASSETS
     
       
Current assets:
     
Cash
  $ 10,405  
Accounts receivable
    31,161  
Inventory
    101,011  
Total current assets
    142,577  
         
Property and equipment, net
    30,383  
Goodwill
    81,013  
         
Total assets
  $ 253,973  
         
LIABILITIES AND DIVISIONAL EQUITY
       
         
Current liabilities:
       
Accounts payable
  $ 13,264  
Accrued expenses
    39,438  
Total current liabilities
    52,702  
         
Commitments and contingencies (Note 6)
    -  
         
Divisional equity
    201,271  
         
Total liabilities and divisional equity
  $ 253,973  

See accompanying notes.
 
F-21

 
LEGALSTORE.COM
(A DIVISION OF DOCUMENT SECURITY SYSTEMS, INC.)
 
CARVE-OUT STATEMENT OF OPERATIONS
For the Period From January 1, 2009 through October 8, 2009
 
     
       
       
Revenue
  $ 359,625  
         
Cost of sales
    178,759  
         
Gross profit
    180,866  
         
Operating expenses:
       
Compensation and benefits
    139,041  
Rent and utilities
    22,255  
Other
    16,182  
Depreciation
    9,218  
Marketing and advertising
    1,250  
      187,946  
         
Net loss
  $ (7,080 )

See accompanying notes.
 
F-22

 
 
LEGALSTORE.COM
(A DIVISION OF DOCUMENT SECURITY SYSTEMS, INC.)
 
CARVE-OUT STATEMENT OF CHANGES IN DIVISIONAL EQUITY
For the Period From January 1, 2009 through October 8, 2009
     
       
       
       
Balance at December 31, 2008
  $ 197,118  
         
Net transfers from parent
    3,907  
         
Stock based compensation
    7,326  
         
Net loss
    (7,080 )
         
Balance at October 8, 2009
  $ 201,271  

See accompanying notes.
 
 
 
 
 
F-23

 
LEGALSTORE.COM
(A DIVISION OF DOCUMENT SECURITY SYSTEMS, INC.)
 
CARVE-OUT STATEMENT OF CASH FLOWS
For the Period From January 1, 2009 through October 8, 2009
     
       
       
Cash flows from operating activities:
     
Net loss
  $ (7,080 )
Adjustments to reconcile net loss to net
       
  cash provided by operating activities:
       
Depreciation
    16,335  
Stock based compensation
    7,326  
Increase in assets:
       
Accounts receivable
    (8,842 )
Inventory
    (5,997 )
Incrase (decrease) in liabilities:
       
Accounts payable
    (1,440 )
Accrued expenses
    4,750  
Net cash provided by operating activities
    5,052  
         
Cash flows from investing activities:
       
Purchase of fixed assets
    (5,005 )
Net cash used by investing activities
    (5,005 )
         
Cash flows from financing activities:
       
Payments of capital lease obligations
    (346 )
Net transfers from parent
    3,907  
Net cash provided by financing activities
    3,561  
         
         
Net increase in cash
    3,608  
         
Cash - beginning of period
    6,797  
         
Cash - end of period
  $ 10,405  

See accompanying notes.
 
F-24

 
NOTE 1. - BACKGROUND AND BASIS OF PRESENTATION

The accompanying carve-out financial statements of Legalstore.com (the “Legalstore.com” and “Business”), a division of Lester Levin, Inc, a New York corporation, have been prepared from the historical accounting records of Lester Levin, Inc.  Lester Levin, Inc. is a wholly owned subsidiary of Document Security Systems, Inc.  Legalstore.com primarily sells legal supplies and documents, including security paper and products for the users of legal documents and supplies in the legal, medical and educational fields.  These carve-out financial statements for Legalstore.com are presented on a carve-out basis from the consolidated financial statements of Document Security Systems, Inc.  These carve-out financial statements have been prepared to facilitate the sale of Legalstore.com assets to Internet Media Services, Inc. (IMS) and the expected subsequent filing of the Form S-1 by IMS (See Note 8).  All material assets and liabilities specifically identified with the Business have been presented in the balance sheet; all material revenues and expenses specifically identified with the Business and allocations of corporate expenses have been presented in the statement of operations. The financial statements have been presented as of the point in time immediately prior to the sale of the LegalStore.com assets and do not reflect the sale transaction discussed in Note 8.
 
Document Security Systems, Inc.’s, equity in the Business has been presented in lieu of shareholders' equity in the carve-out financial statements.  The financial information presented in these carve-out financial statements also reflects certain allocations from Document Security Systems, Inc. that are directly related to the Business and are based on historical activity levels.  As such, the carve-out financial statements may not necessarily reflect the financial position, results of operations or cash flows that the Business might have had in the past, or might have in the future, if the Business had existed as a separate, stand-alone business during the periods presented.
 
The allocations consist of bookkeeping, financial and executive management time, liability insurance, and accounting software costs incurred on behalf of the Business by Document Security Systems, Inc.  In addition, the allocations include stock based compensation expense for options to purchase Document Security Systems, Inc. common stock that was granted to the Business’s employees along with accrued payroll taxes related to grants of common stock of Document Security Systems, Inc.  Management of Document Security Systems, Inc. believes that these allocations and contributions have been made on a reasonable basis. Payments made by Document Security Systems, Inc. to the Business or to Document Security Systems, Inc. from the Business are presented as transfers from and to parent as a component of divisional equity.

NOTE 2. - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Accounting - The carve-out financial statements have been prepared in accordance with accounting principles generally accepted in the United States. The Business's significant accounting policies are summarized below.

 Use of Estimates - The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates and be based on events different from those assumptions. Future events and their effects cannot be predicted with certainty; estimating, therefore, requires the exercise of judgment. Thus, accounting estimates change as new events occur, as more experien ce is acquired or as additional information is obtained.
 
F-25

 
NOTE 2. - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Cash - Cash includes bank deposits.  At times, bank balances may exceed federally insured limits.  The Business has not experienced any losses in such accounts and believes it is not exposed to any significant risk with respect to cash.

Accounts Receivable - The Business provides credit in the normal course of business to the majority of its customers.  The Business performs periodic credit evaluations of its customers’ financial conditions and generally does not require collateral.  Management closely monitors outstanding balances and writes off amounts that it believes are uncollectible after reasonable collection efforts have been made.  No allowance for doubtful accounts was considered necessary at October 8, 2009.  The Business does not accrue interest on past due accounts receivable.

Inventory - Inventories consist of legal supplies held for resale and are stated at the lower of cost or market on the first-in, first-out (“FIFO”) method.

Fixed Assets - Fixed assets are recorded at cost. Depreciation is computed using the straight-line method over the estimated useful lives or lease period of the assets whichever is shorter. Expenditures for renewals and betterments are capitalized. Expenditures for minor items, repairs and maintenance are charged to operations as incurred.  Any gain or loss upon sale or retirement due to obsolescence is reflected in the operating results in the period the event takes place.

Goodwill - Goodwill is the excess of cost of an acquired entity over the fair value of amounts assigned to assets acquired and liabilities assumed in a business combination. The Business has elected the push-down method of accounting whereby the net assets acquired that were adjusted to fair market value with the excess cost recorded as goodwill on the financial statements of Document Security Systems, Inc. have been pushed down to these carve-out financial statements.  The Business does not amortize goodwill, rather it is tested for impairment annually, and will be tested for impairment between annual tests if an event oc curs or circumstances change that would indicate the carrying amount may be impaired. An impairment loss generally would be recognized when the carrying amount of the reporting unit’s net assets exceeds the estimated fair value.  The Business performs annual assessments of potential impairment and has determined that no impairment is necessary as of October 8, 2009.

Impairment of Long-Lived Assets - The Business reviews long-lived assets and certain identifiable intangibles for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.  Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to future net undiscounted cash flows expected to be generated by the asset including its ultimate disposition.  If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets.  Fair value is determined based on discounted cash flows or appraised values, depending on the nature of the assets.
 
F-26

 
NOTE 2. - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Fair Value of Financial Instruments - The Business discloses fair value information about financial instruments. Fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management as of October 8, 2009.
 
These financial instruments include cash, accounts receivable, accounts payable and accrued liabilities. Fair values were assumed to approximate carrying values for these financial instruments since they are short-term in nature and their carrying amounts approximate fair values or they are receivable or payable on demand.

Share-Based Payments - The Business accounts for compensation expense for stock option awards granted under Document Security System, Inc.’s Stock Incentive Plans over the requisite service period based on the grant date fair value of the awards.    During the period from January 1, 2009 through October 8, 2009, there were no options issued to purchase shares of stock of the Business’s parent company, Document Security Systems, Inc., to the Business’s employees.  Legalstore.com employees had 5,500 options outstanding as of October 8, 2009.
 
Compensation expense from stock option grants to the Business’s employees in prior years amounted to $7,326 for the period from January 1, 2009 through October 8, 2009.   
 
The Business uses the Black-Scholes option pricing model for determining the estimated fair value for stock-based awards. The Business records compensation expense related to stock options over the requisite service period based on the grant date fair value of the awards.
 
Revenue Recognition - Sales of legal products are recognized when a product or service is delivered, shipped or provided to the customer and all material conditions relating to the sale have been substantially performed.

Advertising Costs - Generally consist of online, keyword advertising with Google, with additional amounts spent on certain print media in targeted industry publications.   Advertising costs were approximately $345 for the period from January 1, 2009 through October 8, 2009.

Income Taxes - Through October 8, 2009, the Business was not a separate taxable entity for federal, state, or local income tax purposes, and its operations were included in the consolidated tax returns of Document Security Systems, Inc.  Accordingly, all tax attribute carryforwards, such as tax credits and net operating losses, are retained by Document Security Systems, Inc., with no allocation to the Business.  The Business has calculated the tax provision on the separate return basis to illustrate the impact on the Business. Accordingly, deferred income taxes are recognized for differences between the financial statement and tax basis of assets and liabilities at enacted statutory tax rates in effect for the years in which the differences are expected to reverse.  The effect on deferred taxes of a change in tax rates is recognized in income in the period that includes the enactment date.  In addition, a valuation allowance is established to the extent necessary to reduce deferred income tax assets to amounts that more likely than not will be realized.
 
F-27

 
NOTE 2. - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

The Business’s adoption of accounting for uncertainty in income tax did not have a material impact on the Business’s results of operations and financial position, and therefore, the Business did not have any adjustments to the January 1, 2007 beginning balance of divisional equity.  The Business reviews the financial statement recognition and measurement for income tax positions that Document Security Systems, Inc. has taken or expects to take in its consolidated income tax returns on behalf of the Business that were uncertain.   As of October 8, 2009, the Business determined that it did not have any uncertain tax positions.  In addition, the Business did not h ave any material unrecognized tax benefit at October 8, 2009.  It is the Business’s policy to recognize interest accrued and penalties related to unrecognized tax benefits in income tax expense.  For the period January 1, 2009 through October 8, 2009, the Business recognized no interest and penalties. 

NOTE 3. - FIXED ASSETS

  Fixed assets consisted of the following at October 8, 2009:
 
     
Estimated
 
     
Useful Life
 
         
Machinery and equipment
5 years
  $ 29,194  
Leasehold improvements
10 years (1)
    4,026  
Furniture and fixtures
7 years
    20,743  
Software and websites
3 years
    28,995  
        82,958  
Less: accumulated depreciation
      (52,575 )
           
      $ 30,383  

(1)Expiration of lease term.

Depreciation expense was $16,335 for the period from January 1, 2009 through October 8, 2009.
 
F-28

 
NOTE 4. - INCOME TAXES

The provision (benefit) for income taxes shown in the Business’s statement of operations for the period from January 1, 2009 through October 8, 2009 consist of the following:

The provision (benefit) for income taxes as of October 8, 2009 consists of the following:
 
       
Currently payable:
     
     Federal
  $ -  
     State
    -  
Total currently payable
    -  
  Deferred:
       
     Federal
    (1,021 )
     State
    (340 )
Total deferred
    (1,361 )
Less increase in allowance
    1,361  
Net deferred
    -  
Total income tax provision (benefit)
  $ -  
         
         
Individual components of deferred taxes are as follows:
 
         
Deferred tax assets:
       
Net operating loss carry forwards
  $ 24,423  
Equity issued for services
    4,309  
    Total
    28,732  
Less valuation allowance
    (26,698 )
Gross deferred tax assets
  $ 2,034  
         
Deferred tax liabilities:
       
Depreciation
  $ 2,034  
Gross deferred tax liabilities
    2,034  
         
Net deferred tax liabilities
  $ -  

Had the Business filed stand alone tax returns, as of October 8, 2009, net operating losses (NOL’s) of approximately $127,000 would have been available to reduce future taxable income.  Due to the uncertainty as to the Business’s ability to generate sufficient taxable income in the future and utilize the NOL’s before they expire, the Business has recorded a valuation allowance.   On a stand-alone basis, it is assumed that the Business is not a member of a controlled group and therefore, had a Federal tax rate of 15%.
 
F-29

 
 NOTE 5. - DEFINED CONTRIBUTION PENSION PLAN

The Business’s employees participate in an Employee savings plan (the “401(k) Plan”) sponsored by Document Security Systems, Inc., which qualifies as a deferred salary arrangement under Section 401(k) of the Internal Revenue Code.  Employees become eligible to participate in the Plan at the beginning of the following quarter after the employee’s hire date.  Employees may contribute up to 20% of their pay to the Plan, subject to the limitations of the Internal Revenue Code.   The Business’s matching contributions are discretionary.   Pursuant to the 401(k) Plan, employees may elect to defer a portion of their salary on a pre-tax basis.  During the period from January 1, 2009 through October 8, 2009, the Business did not make any matching contributions.
 
NOTE 6. - COMMITMENTS

Facilities - The Business leases 3,829 square feet of office and warehouse space with a monthly rental of approximately $1,700. Lease expense for period from January 1, 2009 through October 8, 2009 was approximately $17,500.  The lease expires on October 31, 2010, although renewal options exist to extend lease agreements for up to an additional 4 years.  Total approximate lease commitments under this lease subsequent to October 8, 2009 are as follows:

 
2009
-
$  3,500
 
2010
-
$19,000


NOTE 7. - RELATED PARTY TRANSACTIONS

Funding - The Business’s cash requirements are funded by Document Security Systems, Inc., which are not subject to formal financing arrangements and do not bear interest.  Transfers to and from Document Security Systems, Inc. are recorded as transfers to/from affiliate as a component of divisional equity because amounts are not expected to be repaid. Included in divisional equity are amounts charged by Document Security Systems, Inc. for allocated corporate services.

Corporate Services - In accordance with SAB No. 55, corporate expense allocations have been reflected in these financial statements.  The corporate expenses have been allocated based on a direct relationship to the Business’s operations and are primarily related to accounting and finance operations performed by Document Security Systems, Inc. personnel on behalf of the Business and liability insurance and for costs associated with the shared use of Document Security Systems, Inc. accounting and ERP system.  In addition, the allocations include sto ck based compensation expense for options to purchase Document Security Systems, Inc.’s common stock that was granted to the Business’s employees along with accrued payroll taxes related to grants of common stock of Document Security Systems, Inc.  Management believes that the basis used for allocating corporate services is reasonable.  However, the terms of these transactions may differ from those that would have resulted from transactions among related parties.
 
F-30

 
NOTE 8. - SALE OF LEGALSTORE.COM ASSETS

On October 8, 2009, Lester Levin Inc., a New York corporation (“LLI”) and wholly owned subsidiary of Document Security Systems, Inc., entered i nto an Asset Purchase Agreement with Internet Media Services, Inc., a Delaware corporation (“IMS”), whereby LLI agreed to sell the assets associated with its Legalstore.com business to IMS. This transaction has not been reflected in the accompanying financial statements.
 
Pursuant to the Asset Purchase Agreement, LLI agreed to sell to IMS all the assets of Legalstore.com, including, but not limited to, equipment, inventories, contracts, domain names, accounts receivable, and certain cash and cash equivalents. In consideration of the sale and transfer of the Acquired Assets, IMS agreed to issue 7,500,000 shares of common stock, par value $.001 per share, of IMS (“IMS Common Stock”) (the “Purchase Price”) to Document Security Systems, Inc., representing 37% of the then outstanding shares.  In addition to issuing the new IMS Common Stock, IMS agreed to assume certain liabilities associated with Legalstore.com, including an existing office lease, trade payab les and accrued payroll.  Certain liabilities presented in the accompanying carve-out financial statements will not be assumed by IMS.
 
Within 180 days of closing, IMS intends to file a registration statement on Form S-1 with respect to the IMS Common Stock pursuant to the terms of the Asset Purchase Agreement and Registration Rights Agreement executed by IMS and Document Security Systems, Inc concurrently with the Asset Purchase Agreement. Pursuant to the terms of the Asset Purchase Agreement, Registration Rights Agreement, and the Stock Pledge and Escrow Agreements executed by IMS’ principal shareholders, IMS, LLI and Document Security Systems, Inc, if IMS fails to secure registration of at least 20% of the IMS Common Stock within 360 days of closing, and to meet certain working capital thresholds contained in the Asset Purchase Agreement, then IMS will be in default. In the event of a default by IMS with respect to the registration of the IMS Common Stock, if IMS has failed to satisfy the working capital requirements provided for in the Asset Purchase Agreement, Document Security Systems, Inc may take back the collateral, consisting of up to 12,500,000 additional shares of IMS Common Stock owned by the IMS shareholders identified in the Pledge Agreements.  If IMS is in default with respect to the registration of IMS Common Stock, and IMS has satisfied the working capital requirements contained in the Asset Purchase Agreement, Document Security Systems, Inc may take back the collateral, consisting of up to 5,250,000 additional shares of IMS Common Stock owned by the IMS shareholders identified in the Pledge Agreements.
 
In addition to the Asset Purchase Agreement, the Registration Rights Agreement, and the Pledge Agreements, IMS’s principal shareholders, IMS and Document Security Systems, Inc entered into a voting agreement whereby the principal shareholders of IMS agreed to vote all IMS Common Stock held by them so as to elect two nominees designated by LLI or Document Security Systems, Inc as members of the IMS Board of Directors.
 
F-31

 
 
 
 
 
 
 
 
 
FINANCIAL STATEMENTS

LEGALSTORE.COM
(A DIVISION OF DOCUMENT SECURITY SYSTEMS, INC.)


DECEMBER 31, 2008
 
 
 

 
 
F-32

 
LEGALSTORE.COM
(A DIVISION OF DOCUMENT SECURITY SYSTEMS, INC.)

CONTENTS
 
 
Page
   
Report of Independent Registered Public Accounting Firm
F-34
   
   
Carve-Out Financial Statements:
 
Balance Sheets
F-35
Statements of Operations
F-36
Statements of Cash Flows
F-37
Statements of Changes in Divisional Equity
F-38
   
   
Notes to the Carve-Out Financial Statements
F-39 - F-48





 
F-33

 
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM


To the Board of Directors of
Document Security Systems, Inc.
 
We have audited the accompanying carve-out balance sheets of Legalstore.com (a division of Document Security Systems, Inc.) as of December 31, 2008 and 2007, and the related carve-out statements of operations, cash flows and changes in divisional equity for the years then ended. These financial statements are the responsibility of Legalstore.com’s management. Our responsibility is to express an opinion on these carve-out financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States).  Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement.  Legalstore.com is not required to have, nor have we been engaged to perform, an audit of its internal control over financial reporting.  Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of Legalstore.com’s internal control over financial reporting.  Accordingly we express no such opinion.  An audit includes examini ng, 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 carve-out financial position of Legalstore.com (a division of Document Security Systems, Inc.) as of December 31, 2008 and 2007, and the results of its carve-out operations, cash flows and changes in divisional equity for the years then ended, in conformity with U.S. generally accepted accounting principles.

As discussed in Note 8 to the carve-out financial statements, on October 8, 2009 Document Security Systems, Inc. entered into an asset purchase agreement to sell the assets associated with Legalstore.com (a division of Document Security Systems, Inc.).

/s/ FREED MAXICK & BATTAGLIA, CPAs, PC

Buffalo, New York
December 11, 2009
 
F-34

 

LEGALSTORE.COM
(a Division of Document Security Systems, Inc.)
Carve-Out Balance Sheets
As of
                   
   
September 30,
   
December 31,
   
December 31,
 
    2009     2008     2007  
   
(unaudited)
             
                   
ASSETS
                 
                   
Current assets:
                 
Cash
  $ 18,186     $ 6,797     $ 137,734  
Accounts receivable
    31,434       22,319       35,407  
Inventory
    92,521       95,014       116,108  
                         
      Total current assets
    142,141       124,130       289,249  
                         
Fixed assets, net
    32,218       46,718       49,961  
Goodwill
    81,013       81,013       81,013  
                         
Total assets
  $ 255,372     $ 251,861     $ 420,223  
                         
LIABILITIES AND DIVISIONAL EQUITY
                       
                         
Current liabilities:
                       
Accounts payable
  $ 18,563     $ 19,709     $ 40,671  
Accrued liabilities
    35,833       34,688       34,688  
Current portion of capital lease obligations
    -       346       980  
                         
      Total current liabilities
    54,396       54,743       76,339  
                         
Capital lease obligations
    -       -       347  
                         
Commitments and contingencies (see Note 6)
                       
                         
Divisional equity
    200,976       197,118       343,537  
                         
                         
Total liabilities and divisional equity
  $ 255,372     $ 251,861     $ 420,223  
 
See accompanying notes.

 
F-35

 
LEGALSTORE.COM
 
   
(a Division of Document Security Systems, Inc.)
 
Carve-out Statements of Operations
 
                         
                         
                         
                         
   
For the Nine Months Ended September 30,
   
For the Nine Months Ended September 30,
   
For the Year Ended December 31,
   
For the Year Ended December 31,
 
   
2009
   
2008
    2008      2007  
                         
   
(unaudited)
   
(unaudited)
             
                         
Revenue
  $ 357,397     $ 482,553     $ 609,807     $ 682,051  
                                 
                                 
Costs of revenue
    177,544       271,296       351,769       373,537  
                                 
                                 
Gross profit
    179,853       211,257       258,038       308,514  
                                 
Operating expenses:
                               
Compensation and benefits
    130,028       151,862       201,819       203,356  
Marketing and advertising
    1,250       22,483       27,667       53,286  
Rent and utilities
    20,516       17,716       23,570       23,394  
Depreciation
    8,250       8,118       10,824       5,340  
Other
    16,623       13,715       23,732       41,531  
                                 
        Operating expenses
    176,667       213,894       287,612       326,907  
                                 
Net income (loss)
  $ 3,186     $ (2,637 )   $ (29,574 )   $ (18,393 )

See accompanying notes.
 
F-36

 
LEGALSTORE.COM
 
(a Division of Document Security Systems, Inc.)
 
Carve-out Statements of Cash Flows
 
                   
                   
                   
   
For the Nine Months Ended September 30,
 
For the Nine Months Ended September 30,
 
For the Year Ended
December 31,
 
    2009   2008  
2008
 
2007
 
   
(unaudited)
 
(unaudited)
         
                   
                   
Cash flows from operating activities:
                 
     Net income (loss)
  $ 3,186   $ (2,637 ) $ (29,574 ) $ (18,393 )
     Adjustments to reconcile net income (loss) to net
                         
cash provided (used) by operating activities:
                         
Depreciation
    14,705     11,583     15,787     10,412  
Stock based compensation
    7,326     7,326     9,768     3,196  
(Increase) decrease in assets:
                         
Accounts receivable
    (9,115 )   (3,412 )   13,088     2,399  
Inventory
    2,493     17,868     21,094     (30,743 )
Increase (decrease) in liabilities:
                         
Accounts payable
    3,654     3,811     (25,762 )   5,648  
Accrued liabilities
    1,145     (222 )   -     1,202  
Net cash provided (used) by operating activities
    23,394     34,317     4,401     (26,279 )
                           
Cash flows from investing activities:
                         
Purchase of fixed assets
    (5,005 )   (5,944 )   (7,744 )   (16,452 )
                           
Net cash used by investing activities
    (5,005 )   (5,944 )   (7,744 )   (16,452 )
                           
Cash flows from financing activities:
                         
Payments of capital lease obligations
    (346 )   (728 )   (981 )   (901 )
Transfers from (to) parent
    (6,654 )   (103,128 )   (126,613 )   181,366  
                           
Net cash (used) provided by financing activities
    (7,000 )   (103,856 )   (127,594 )   180,465  
                           
Net (decrease) increase in cash
    11,389     (75,483 )   (130,937 )   137,734  
Cash beginning of period
    6,797     137,734     137,734     0  
                           
Cash end of period
  $ 18,186   $ 62,251   $ 6,797   $ 137,734  

See accompanying notes.
 
 
F-37

 
LEGALSTORE.COM
 
(a Division of Document Security Systems, Inc.)
 
Carve-out Statements of Changes in Divisional Equity
 
       
       
   
Total
 
       
Balance, December 31, 2006
  $ 177,368  
Transfers from parent, net
    181,366  
Stock based compensation
    3,196  
Net loss
    (18,393 )
Balance, December 31, 2007
    343,537  
Transfers to parent, net
    (126,613 )
Stock based compensation
    9,768  
Net loss
    (29,574 )
Balance, December 31, 2008
    197,118  
Transfers to parent, net (unaudited)
    (6,654 )
Stock based compensation (unaudited)
    7,326  
Net income (unaudited)
    3,186  
Balance, September 30, 2009 (unaudited)
  $ 200,976  
 
See accompanying notes.
 
 
F-38

 
LEGALSTORE.COM
(A DIVISION OF DOCUMENT SECURITY SYSTEMS, INC.)

NOTES TO THE CARVE-OUT FINANCIAL STATEMENTS
 
NOTE 1. – BACKGROUND AND BASIS OF PRESENTATION

The accompanying carve-out financial statements of Legalstore.com (the “Legalstore.com” and “Business”), as a division of Lester Levin, Inc, a New York corporation, have been prepared from the historical accounting records of Lester Levin, Inc.  Lester Levin, Inc was 100% owned by Document Security Systems during the years ended December 31, 2008 and 2007 and for the nine months ended September 30, 2009.  Legalstore.com primarily sells legal supplies and documents, including security paper and products for the users of legal documents and supplies in the legal, medical and educational fields.  These carve-out financial statements for Legalstore.com are presented on a carve-out basis from the consolidated financial statements of Document Security Systems, Inc.  These carve - -out financial statements have been prepared to facilitate the sale of Legalstore.com assets to Internet Media Services, Inc. (IMS) and the expected subsequent filing of the Form S-1 by IMS (See Note 9).  All material assets and liabilities specifically identified with the Business have been presented in the balance sheets; all material revenues and expenses specifically identified with the Business and allocations of corporate expenses have been presented in the statements of operations.
 
Document Security Systems, Inc.’s, equity in the Business has been presented in lieu of shareholders' equity in the carve-out financial statements.  The financial information presented in these carve-out financial statements also reflects certain allocations from Document Security Systems that are directly related to the Business and are based on historical activity levels.  As such, the carve-out financial statements may not necessarily reflect the financial position, results of operations or cash flows that the Business might have had in the past, or might have in the future, if the Business had existed as a separate, stand-alone business during the periods presented.
 
The allocations consist of bookkeeping, financial and executive management time, liability insurance, and accounting software costs incurred on behalf of the Business by Document Security Systems, Inc..  In addition, the allocations include stock based compensation expense for options to purchase Document Security Systems, Inc. common stock that was granted to the Business’s employees along with accrued payroll taxes related to grants of common stock of Document Security Systems, Inc..  Management of Document Security Systems, Inc. believes that these allocations and contributions have been made on a reasonable basis. Payments made by Document Security Systems, Inc. to the Business or to Document Security Systems, Inc.  from the Business are presented as transfers to and from parent as a component o f divisional equity.

Interim Financial Information – The carve-out financial information at September 30, 2009 and the nine months ended September 30, 2009 and 2008 is unaudited but, in the opinion of management, has been prepared on the same basis as the annual carve-out financial statements and includes all adjustments (consisting only of normal recurring adjustments) that the Business considers necessary for a fair presentation of the financial position at such date and the operating result, cash flow and divisional equity for such periods.  Interim results are not necessarily indicative of results expected for a full year.   These financial statements have not been updated for subsequent events occurring after December 11, 2009.

NOTE 2. - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Accounting - The carve-out financial statements have been prepared in accordance with accounting principles generally accepted in the United States. The Business's significant accounting policies are summarized below.
 
F-39

 
LEGALSTORE.COM
(A DIVISION OF DOCUMENT SECURITY SYSTEMS, INC.)

NOTES TO THE CARVE-OUT FINANCIAL STATEMENTS
 
NOTE 2. - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Use of Estimates - The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates and be based on events different from those assumptions. Future events and their effects cannot be predicted with certainty; estimating, therefore, requires the exercise of judgment. Thus, accounting estimates change as new events occur, as more experience is acquired or as additional information is obtained.
 
Cash – Cash includes bank deposits.  At times, bank balances may exceed federally insured limits.  The Business has not experienced any losses in such accounts and believes it is not exposed to any significant risk with respect to cash.

Accounts Receivable - The Business provides credit in the normal course of business to the majority of its customers.  The Business performs periodic credit evaluations of its customers’ financial condition and generally does not require collateral.  Management closely monitors outstanding balances and writes off amounts that it believes are uncollectible after reasonable collection efforts have been made.  No allowance for doubtful accounts was considered necessary at December 31, 2008 and 2007 and September 30, 2009.  The Business does not accrue interest on past due accounts receivable.

Inventory - Inventories consist of legal supplies held for resale and are stated at the lower of cost or market on the first-in, first-out (“FIFO”) method.

Fixed Assets - Fixed assets are recorded at cost. Depreciation is computed using the straight-line method over the estimated useful lives or lease period of the assets whichever is shorter. Expenditures for renewals and betterments are capitalized. Expenditures for minor items, repairs and maintenance are charged to operations as incurred.  Any gain or loss upon sale or retirement due to obsolescence is reflected in the operating results in the period the event takes place.

Goodwill - Goodwill is the excess of cost of an acquired entity over the fair value of amounts assigned to assets acquired and liabilities assumed in a business combination. The Business has elected the push-down method of accounting whereby the net assets acquired that were adjusted to fair market value with the excess cost recorded as goodwill on the financial statements of Document Security Systems, Inc. have been pushed down to these carve-out financial statements.  The Business does not amortize goodwill, rather it is tested for impairment annually, and will be tested for impairment between annual tests if an event occurs or circumstances change that would indicate the carrying amount may be impaired. An impairment loss generally would be recogn ized when the carrying amount of the reporting unit’s net assets exceeds the estimated fair value.  The Business performs annual assessments of potential impairment and has determined that no impairment is necessary as of December 31, 2008 and 2007 and September 30, 2009.

Impairment of Long-Lived Assets - The Business reviews long-lived assets and certain identifiable intangibles for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.  Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to future net undiscounted cash flows expected to be generated by the asset including its ultimate disposition.  If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets.  Fair value is determined based on discounted cash flows or appraised values, depending on the nature of the assets.
 
F-40

 
LEGALSTORE.COM
(A DIVISION OF DOCUMENT SECURITY SYSTEMS, INC.)

NOTES TO THE CARVE-OUT FINANCIAL STATEMENTS
 
NOTE 2. - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Fair Value of Financial Instruments - The Business discloses fair value information about financial instruments. Fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management as of December 31, 2008 and 2009 and September 30, 2009.

These financial instruments include cash, accounts receivable, accounts payable, accrued liabilities and capital leases. Fair values were assumed to approximate carrying values for these financial instruments since they are short-term in nature and their carrying amounts approximate fair values or they are receivable or payable on demand. The fair value of the Business’s capitalized lease obligation is estimated based upon the carrying value which approximates the fair value of the debt instrument in 2008 and 2007.

Share-Based Payments - The Business accounts for compensation expense for stock option awards granted under Document Security System’s Stock Incentive Plans over the requisite service period based on the grant date fair value of the awards.    During the year ended December 31, 2007, the Business’s employees were issued a total of 4,500 options to purchase shares of stock of the Business’s parent company, Document Security Systems, Inc. at various prices.   There were no options issued to the Business’s employees during the year ended December 31, 2008 or the nine-months ended September 30, 2009.  Legalstore.com employees have 5,500 options outstanding as of December 31, 2008 and 2007 and Sep tember 30, 2009, respectively, which includes 1,000 options outstanding as of December 31, 2006.
 
Compensation expense for the Business’s employees from stock option grants for the years ended December 31, 2008 and 2007, and for the period ended September 30, 2009 and 2008, was $9,768, $3,196  $7,326 and $7,326, respectively.    The Business uses the Black-Scholes option pricing model for determining the estimated fair value for stock-based awards with the following assumptions:

 
Period Ended September 30, 2009
 
Year Ended December 31, 2008
 
Year Ended December 31, 2007
 
             
             
 Risk-free interest rate
na
 
na
    4.05 %
 Volatility
na
 
na
    54 %
 Expected dividend yield
na
 
na
    0 %
 Expected life
na
  na  
3.75 years
 Estimated forfeiture rate
na
 
na
    0 %
 
The Business calculates expected volatility for a share-based grant based on historic daily stock price observations of Document Security Systems, Inc.’s common stock during the period immediately preceding the grant that is equal in length to the expected term of the grant. For estimating the expected term of share-based grants, the Business has adopted the simplified method.
 
 
F-41

 
LEGALSTORE.COM
(A DIVISION OF DOCUMENT SECURITY SYSTEMS, INC.)

NOTES TO THE CARVE-OUT FINANCIAL STATEMENTS
 
NOTE 2. - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Revenue Recognition - Sales of legal products are recognized when a product or service is delivered, shipped or provided to the customer and all material conditions relating to the sale have been substantially performed.

Advertising Costs– Generally consist of online, keyword advertising with Google with additional amounts spent on certain print media in targeted industry publications.   Advertising costs were approximately $22,000 in 2008 ($48,000 – 2007).

Income Taxes - Through September 30, 2009, the Business was not a separate taxable entity for federal, state, or local income tax purposes, and its operations were included in the consolidated tax returns of Document Security Systems, Inc.  Accordingly, all tax attribute carryforwards, such as tax credits and net operating losses, are retained by Document Security Systems, Inc., with no allocation to the Business.  The Business has calculated the tax provision on the separate return basis to illustrate the impact on the Business. Accordingly, deferred income taxes are recognized for differences between the financial statement and tax basis of assets and liabilities at enacted statutory tax rates in effect for the years in which the differen ces are expected to reverse.  The effect on deferred taxes of a change in tax rates is recognized in income in the period that includes the enactment date.  In addition, a valuation allowance is established to the extent necessary to reduce deferred income tax assets to amounts that more likely than not will be realized.

The Business’s adoption of accounting for uncertainty in income tax did not have a material impact on the Business’s results of operations and financial position, and therefore, the Business did not have any adjustments to the January 1, 2007 beginning balance of divisional equity.  The Business reviews the financial statement recognition and measurement for income tax positions that Document Security Systems, Inc. has taken or expects to take in its consolidated income tax returns on behalf of the Business that were uncertain.   As of December 31, 2008 and 2007 and 2007 and September 30, 2009 and 2008, the Business determined that it did not have any uncertain tax positions.  In addition, the Business did not have any material unrecognized tax benefit at December 31, 2008 and 2007 and pe riods ending September 30, 2009 and 2008.  The Business would have recognized interest accrued and penalties related to unrecognized tax benefits in tax expense.  During the years ended December 31, 2008 and 2007 and periods ending September 30, 2009 and 2008, the Business recognized no interest and penalties.  

Recent Accounting Pronouncements- In September 2006, the FASB issued SFAS No. 157 (“SFAS 157”), “Fair Value Measurements.”  SFAS 157, now Accounting Standards Codification (“ASC”) 820, as amended, defines fair value, establishes a framework for measuring fair value and expands disclosures regarding fair value measurements.  ASC 820 does not require any new fair value measurements but rather eliminates inconsistencies in guidance found in various prior accounting pronouncements.  ASC 820 was effective for fiscal years beginning after November 15, 2007.  However, on December 14, 2007, the FASB issued proposed FSP FAS 157-2 which delayed the effective date of ASC 820 for all nonfinancial assets and nonfinanc ial liabilities, except those that are recognized or disclosed at fair value in the financial statements on a recurring basis (at least annually), to fiscal years beginning after November 15, 2008.  Accordingly, the Business’s adoption of this standard in 2008 was limited to financial assets and liabilities and did not have a material effect on the Business’s financial condition or results of operations.  The adoption of the portion of this statement related to nonfinancial assets and liabilities in 2009 did not have a material effect on the Business’s financial statements. 
 
 
F-42

 
LEGALSTORE.COM
(A DIVISION OF DOCUMENT SECURITY SYSTEMS, INC.)

NOTES TO THE CARVE-OUT FINANCIAL STATEMENTS
 
NOTE 2. - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

In June 2009, the FASB issued Statement of Financial Accounting Standard (SFAS) No. 168, The FASB Accounting Standard Codification and the Hierarchy of the Generally Accepted Accounting Principles — a replacement of SFAS No. 162 (SFAS 168), now Accounting Standards Codification (ASC) 105, to become the source of authoritative U.S. generally accepted accounting principles (“GAAP”) recognized by the FASB to be applied by nongovernmental entities. ASC 105 is effective for financial statements issued for interim and annual periods ending after September 15, 2009 and first adopted in the quarterly financial statements for the period ended September 30, 2009.  The Business does not believe the adoption of ASC 105 had a material impact on the financial statements.

In April 2009, the FASB staff issued FSP No. FAS 107-1 and APB 28-1, Interim Disclosures about Fair Value of Financial Instruments (“FSP No. FAS 107-1 and APB 28-1”), now ASC 825. ASC 825 amends prior standards to require disclosures about fair value of financial instruments in interim financial statements as well as in annual financial statements. The provisions of ASC 825 became effective on April 1, 2009, are being applied prospectively beginning September 30, 2009 and did not have a material impact on the Business’s financial statements.  See “Fair Value of Financial Instruments” included in “Note 2 for the related disclosure.

In May 2009, the FASB issued Statement No. 165, Subsequent Events (“FAS 165”), now ASC 855. The provisions of ASC 855 set forth the period after the balance sheet date during which management of a reporting entity should evaluate events or transactions that may have occurred for potential recognition or disclosure in the financial statements, the circumstances under which an entity should recognize events or transactions occurring after the balance sheet date in its financial statements and the disclosures that an entity should make about events or transactions that occurred after the balance sheet date. The provisions of ASC 855 became effective for the Business on April 1, 2009, are being applied prospectively beginning September 30, 2009 and did not have a material impact on the Business’s financial statements.
 

 
F-43

 
LEGALSTORE.COM
(A DIVISION OF DOCUMENT SECURITY SYSTEMS, INC.)

NOTES TO THE CARVE-OUT FINANCIAL STATEMENTS
 
NOTE 3. - FIXED ASSETS

  Fixed assets consisted of the following at December 31:
 
 
Estimated Useful Life
 
Purchased
 
Under Capital Leases
 
Purchased
 
Under Capital Leases
 
                     
                     
                     
                     
Machinery & equipment
5 years
  $ 24,905   $ 4,289   $ 24,905   $ 4,289  
Leasehold improvements
10 years(1)
    4,026     -     4,026     -  
Furniture & fixtures
7 years
    20,743     -     20,743     -  
Software & websites
3 years
    28,995     -     16,451     -  
                             
  Total cost
      78,669     4,289     66,125     4,289  
Less accumulated depreciation
      32,380     3,860     17,451     3,002  
                             
Net
    $ 46,289   $ 429   $ 48,674   $ 1,287  

(1) Expiration of lease term

Fixed assets consisted of the following at September 30, 2009 (Unaudited):
 
 
Estimated Useful Life
 
Purchased
 
Under Capital Leases
 
             
             
             
             
Machinery & equipment
5 years
  24,905     4,289  
Leasehold improvements
10 years(1)
  4,026     -  
Furniture & fixtures
7 years
  20,743     -  
Software & websites
3 years
  28,995     -  
               
  Total cost
    78,669     4,289  
Less accumulated depreciation
    46,451     4,289  
               
Net
    32,218     -  
 
(1) Expiration of lease term
 
NOTE 4. - INCOME TAXES

The net operating income and losses incurred and tax credits earned since inception attributable to the operations of the Business, a division of Lester Levin, Inc., were included in the consolidated income tax returns filed by Document Security Systems, Inc.  Accordingly, all tax attribute carryforwards, such as tax credits and net operating losses, are retained by Document Security Systems, Inc. with no allocation to the Business.
 
F-44

 
LEGALSTORE.COM
(A DIVISION OF DOCUMENT SECURITY SYSTEMS, INC.)

NOTES TO THE CARVE-OUT FINANCIAL STATEMENTS
 
NOTE 4. - INCOME TAXES (CONTINUED)

Deferred income taxes are recognized for differences between the financial statements and the tax basis of assets and liabilities at enacted statutory tax rates in effect for the years in which the differences are expected to reverse.  The effect on deferred taxes of a change in tax rates is recognized in income in the year that includes the enactment date.  In addition, valuation allowances are established when necessary to reduce deferred tax asset to the amount expected to be realized.

The provision (benefit) for income taxes shown in the Business’s statement of operations for the year ended December 31, 2008 and 2007consist of the following:
 
   
2008
   
2007
 
  Currently payable:
           
     Federal
  $ -     $ -  
     State
    -       -  
Total currently payable
    -       -  
  Deferred:
               
     Federal
    (4,483 )     (3,616 )
     State
    (1,197 )     (1,193 )
Total deferred
    (5,680 )     (4,809 )
Less increase in allowance
    5,680       4,809  
Net deferred
    -       0  
Total income tax provision (benefit)
  $ 0     $ 0  
                 
                 
Individual components of deferred taxes are as follows:
               
                 
Deferred tax assets:
    2008       2007  
Net operating loss carry forwards
  $ 23,631     $ 18,988  
Equity issued for services
    2,902       1,026  
    Total
    26,533       20,014  
Less valuation allowance
    (25,337 )     (19,657 )
Gross deferred tax assets
  $ 1,196     $ 357  
                 
Deferred tax liabilities:
               
Depreciation
  $ 1,196     $ 357  
Gross deferred tax liabilities
  $ 1,196     $ 357  
                 
Net deferred tax liabilities
  $ -     $ -  
 
Had the Business filed stand alone tax returns, as of December 31, 2008, Net Operating Losses (NOL’s) of approximately $123,000 would have been available to reduce future taxable income.  Due to the uncertainty as to the Business’s ability to generate sufficient taxable income in the future and utilize the NOL’s before they expire, the Business has recorded a valuation allowance.   On a stand-alone basis, it is assumed that the Business is not a member of a controlled group and therefore, had a Federal tax rate of 15%.
 
F-45

 
LEGALSTORE.COM
(A DIVISION OF DOCUMENT SECURITY SYSTEMS, INC.)

NOTES TO THE CARVE-OUT FINANCIAL STATEMENTS
 
NOTE 4. - INCOME TAXES (CONTINUED)
 
The provision (benefit) for income taxes consists of the following at September 30, 2009:
   
2009
 
  Currently payable:
     
     Federal
  $ -  
     State
    -  
Total currently payable
    -  
  Deferred:
       
     Federal
    (3,626 )
     State
    (1,197 )
Total deferred
    (4,823 )
Less increase in allowance
    4,823  
Net deferred
    -  
Total income tax provision (benefit)
  $ 0  
 
The accompanying unaudited income tax footnote has been prepared in accordance with U.S. generally accepted accounting principles for interim financial information.  Accordingly this footnote does not include all of the information required by U.S. generally accepted accounting principles for complete financial statements.
 
NOTE 5. - DEFINED CONTRIBUTION PENSION PLAN

The Business’s employees participate in an Employee savings plan (the “401(k) Plan”) sponsored by Document Security Systems, Inc. which qualifies as a deferred salary arrangement under Section 401(k) of the Internal Revenue Code.  Employees become eligible to participate in the Plan at the beginning of the following quarter after the employee’s hire date.  Employees may contribute up to 20% of their pay to the Plan, subject to the limitations of the Internal Revenue Code.   The Business’s matching contributions are discretionary.   Pursuant to the 401(k) Plan, employees may elect to defer a portion of their salary on a pre-tax basis.  For employees who participated in the plan, the Business matched the employer’s contribution in 2007 pursuant to the Safe Harbor Provisions of Section 401(k) of the Internal Revenue Code up to 4% in 2007 of the participating employee’s annual compensation.  During the period ended September 30, 2009 and the year ended December 31, 2008, the Business did not make any matching contributions.  During the year ended December 31, 2007 the Business contributed approximately $5,000 to the 401(k) plan for its employees.
 
F-46

 
LEGALSTORE.COM
(A DIVISION OF DOCUMENT SECURITY SYSTEMS, INC.)

NOTES TO THE CARVE-OUT FINANCIAL STATEMENTS
 
NOTE 6. - COMMITMENTS

Facilities - The Business leases 3,829 square feet of office and warehouse space with a monthly rental of approximately $1,700. Lease expense for years ended December 31, 2008 and 2007 was approximately $21,000 and $21,000, respectively.  The lease expires on October 31, 2010, although renewal options exist to extend lease agreements for up to an additional 4 years.  Total approximate lease commitments with this lease as of December 31, 2008 are as follows:

2009
  $ 21,000  
2010
  $ 19,000  
 
NOTE 7. – RELATED PARTY TRANSACTIONS

Funding – The Business’s cash requirements are funded by Document Security Systems, Inc. which are not subject to formal financing arrangements and do not bear interest.    Transfers to and from Document Security Systems, Inc. are recorded as transfers to/from affiliate as a component of divisional equity because amounts are not expected to be repaid.   Included in divisional equity are amounts charged by Document Security Systems for allocated corporate services.

Corporate Services – In accordance with SAB No. 55, corporate expense allocations have been reflected in these financial statements.  The corporate expenses have been allocated based on a direct relationship to the Business’s operations and are primarily related to accounting and finance operations performed by Document Security Systems personnel on behalf of the Business and liability insurance and for costs associated with the shared use of Document Security Systems accounting and ERP system.   In addition, the allocations include stock based compensation expense for options to purchase Document Security Systems’ common stock that was granted to the Busine ss’s employees along with accrued payroll taxes related to grants of common stock of Document Security Systems, Inc..  Management believes that the basis used for allocating corporate services is reasonable.  However, the terms of these transactions may differ from those that would have resulted from transactions among related parties.

NOTE 8. - SUBSEQUENT EVENTS

On October 8, 2009, Lester Levin Inc., a New York corporation (“LLI”) and wholly owned subsidiary of Document Security Systems, Inc., entered into an Asset Purchase Agreement with Internet Media Services, Inc., a Delaware corporation (“IMS”), whereby LLI agreed to sell the assets associated with its LegalStore.com business (“LegalStore”) to IMS.

Pursuant to the Asset Purchase Agreement, LLI agreed to sell to IMS all the assets of LegalStore, (including, but not limited to, equipment, inventories, contracts, domain names, accounts receivable, and certain cash and cash equivalents. In consideration of the sale and transfer of the Acquired Assets, IMS agreed to issue 7,500,000 shares of common stock, par value $.001 per share, of IMS (“IMS Common Stock”) (the “Purchase Price”) to Document Security Systems, Inc., representing 37% of the then outstanding shares.  In addition to issuing the new IMS Common Stock, IMS agreed to assume certain liabilities associated with LegalStore, including an existing office lease, trade payables and accrued payroll.  Certain liabilities presented in the accompanying carve-out financial statements will no t be assumed by IMS.
 
F-47

 
LEGALSTORE.COM
(A DIVISION OF DOCUMENT SECURITY SYSTEMS, INC.)

NOTES TO THE CARVE-OUT FINANCIAL STATEMENTS
 
NOTE 8. - SUBSEQUENT EVENTS (CONTINUED)

Within 180 days of closing, IMS intends to file a registration statement on Form S-1 with respect to the IMS Common Stock pursuant to the terms of the Asset Purchase Agreement and Registration Rights Agreement executed by IMS and Document Security Systems, Inc concurrently with the Asset Purchase Agreement. Pursuant to the terms of the Asset Purchase Agreement, Registration Rights Agreement, and the Stock Pledge and Escrow Agreements executed by IMS’ principal shareholders, IMS, LLI and Document Security Systems, Inc, if IMS fails to secure registration of at least 20% of the IMS Common Stock within 360 days of closing, and to meet certain working capital thresholds contained in the Asset Purchase Agreement, then IMS will be in default. In the event of a default by IMS with respect to the registration of the IMS Common Stock, if IMS has failed to satisfy the working capital requirements provided for in the Asset Purchase Agreement, Document Security Systems, Inc may take back the collateral, consisting of up to 12,500,000 additional shares of IMS Common Stock owned by the IMS shareholders identified in the Pledge Agreements.  If IMS is in default with respect to the registration of IMS Common Stock, and IMS has satisfied the working capital requirements contained in the Asset Purchase Agreement, Document Security Systems, Inc may take back the collateral, consisting of up to 5,250,000 additional shares of IMS Common Stock owned by the IMS shareholders identified in the Pledge Agreements.

In addition to the Asset Purchase Agreement, the Registration Rights Agreement, and the Pledge Agreements, IMS’ principal shareholders, IMS and Document Security Systems, Inc entered into a voting agreement whereby the principal shareholders of IMS agreed to vote all IMS Common Stock held by them so as to elect two nominees designated by LLI or Document Security Systems, Inc as members of the IMS Board of Directors.


 
F-48

 
Unaudited Pro Forma Financial Statement
 
The following table sets forth our summary unaudited pro forma consolidated financial data as of December 31, 2009 as if the LegalStore.com assets had been purchased as of January 1, 2009.  The pro forma data for the twelve months ended December 31, 2009 has been derived by adding our audited consolidated financial data for the year ended Decemebr 31, 2009 and the unaudited LegalStore.com (a Division of Document Security Systems, Inc.) carve-out financial statements for the period prior to the asset purchase agreement.  The summary consolidated financial data as of December 31, 2009 have been derived from and should be read together with our audited consolidated financial statements and the related notes incorporated by reference in this prospectus.  The summary consolidated financial data of LegalStore,com for the the period prior to the asset purchase agreement have been derived from and should be read together with the unaudited LegalStore.com consolidated financial statements and the related notes incorporated by reference in this prospectus.  The unaudited condensed consolidated financial statements have been prepared on the same basis as our audited consolidated financial statements and, in the opinion of our management, reflect all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of the financial information for the periods presented.
 
The unaudited pro forma condensed combined financial information should not be considered illustrative of what our results of operations would have been had the LegalStore.com acquisition been completed on the dates indicated.  The results presented below are not necessarily indicative of the results to be expected for any future period, and the results for any interim period are not necessarily indicative of the results that may be expected for a full year. We therefore caution you not to place undue reliance on the unaudited pro forma condensed combined financial information.   You should read the following tables together with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included elsewhere in this prospectus and our historical consolidated financial s tatements and the related notes incorporated by reference herein.
 
INTERNET MEDIA SERVICES, INC.
 
                         
Pro forma Consolidated Statement of Operations
 
For the Year Ended December 31, 2009
 
                         
   
LegalStore.com (a Division of Document Security Systems, Inc.)
   
Internet Media Services, Inc.
   
Adjustments
   
Pro forma Total For the Year Ended December 31,
 
   
2009
   
2009
    2009     2009  
   
(unaudited)
   
(audited)
             
                         
Revenue
  $ 359,625     $ 111,022     $ -     $ 470,647  
                                 
                                 
Costs of revenue
    178,759       80,983       -       259,742  
                                 
                                 
Gross profit
    180,866       30,039       -       210,905  
                                 
Operating expenses
    187,946       104,211               292,157  
                                 
Net income (loss)
  $ (7,080   $ (74,172 )   $ -     $ (81,252 )

 
 
F-49

 
 
 
 
 
 
 
 
Dealer Prospectus Delivery Obligation

Until ____________, all dealers that effect transactions in these securities, whether or not participating in this offering, may be required to deliver a prospectus.  This is in addition to the dealers’ obligation to deliver a prospectus when acting as underwriter and with respect to their unsold allotments or subscriptions.
 
 
 
 
 
 
 
 
 
 
 
 
 
 

 
 
-30-

 

PART II. INFORMATION NOT REQUIRED IN PROSPECTUS
 
Item 13.   Other Expenses of Issuance and Distribution
 
The estimated expenses of registration and distribution will be borne exclusively by the Registrant and include:
 
Registration fee
 
$
 6 
 
Transfer agent fees
 
$
10,000
 
Legal fees
 
$
50,000
 
Accounting fees
 
$
37,000
 
Miscellaneous expenses
 
$
5,000
 
Total
 
$
102,006
 

RECENT SALE OF UNREGISTERED SECURITIES

Item 14.   Indemnification of Directors and Officers

Our Certificate of Incorporation provides that liability of directors to us for monetary damages is eliminated to the full extent provided by Delaware law.  Under Delaware law, a director is not personally liable to us or our stockholders for monetary damages for breach of fiduciary duty as a director except for liability (i) for any breach of the director’s duty of loyalty to us or our stockholders; (ii) for acts or omissions not in good faith or that involve intentional misconduct or a knowing violation of law; (iii) for authorizing the unlawful payment of a dividend or other distribution on our capital stock or the unlawful purchases of our capital stock; (iv) a violation of Delaware law with respect to conflicts of interest by directors; or (v) for an y transaction from which the director derived any improper personal benefit.

The effect of this provision in our Certificate of Incorporation is to eliminate our rights and our stockholders’ rights (through stockholders’ derivative suits) to recover monetary damages from a director for breach of the fiduciary duty of care as a director (including any breach resulting from negligent or grossly negligent behavior) except in the situations described in clauses (i) through (v) above.  This provision does not limit or eliminate our rights or the rights of our security holders to seek non-monetary relief, such as an injunction or rescission, in the event of a breach of a director’s duty of care or any liability for violation of the federal securities laws.

            Insofar as indemnification for liabilities arising under the Act may be permitted to our directors, officers and controlling persons pursuant to the foregoing provisions, or otherwise, we have been advised that in the opinion of the SEC such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable.
 
Item  15.   Recent Sales of Unregistered Securities
 
In the last three years, we have issued the following unregistered securities:
 
Date
Name
Shares
Price per Share
May 11, 2009
Raymond Meyers
9,000,000
$.001
May 11, 2009
Alexander Orlando
1,000
$.001
May 11, 2009
Michael Buechler
4,000,000
$.001
October 8, 2009
Document Security Systems, Inc.
7,500,000
Exchanged for Assets in LegalStore.com
 
All of the shares issued above were issued pursuant to the exemption from registration provided in Section 4(2) of the Securities Act of 1933, as amended.  The shares were issued to only four investors, three of whom were officers and/or directors of the Company and the fourth was Document Security Systems, Inc. a public company which is also a control stockholder of the Company.
 
-31-

 
Item 16.    Exhibit Index
 
 
3.1
Certificate of Incorporation of the Registrant, as amended (1)
 
3.2
By-laws of the Registrant (1)
 
5.1
Opinion on legality (Revised)
 
10.1
Lease (Santa Monica) (1)
 
10.2
Agreements with DSS with exhibits and schedules (Revised)
 
10.3
Revolving Credit Agreement
 
10.4
Security Agreement
 
10.5
Secured Promissory Note
 
23.1
Consent of  independent registered public accounting firm
 
23.2
Consent of Gary A. Agron (See Exhibit 5.1)
 
(1) Previously filed

Item 17.   Undertakings

The undersigned registrant hereby undertakes:

            (1)           To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:
 
i.           To include any prospectus required by section 10(a)(3) of the Securities Act of 1933;

ii.          To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement.  Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than 12% change in the maximum aggregate offering price set forth in the “Calculation of registration Fee” table in the effective registration statements; and

iii.         To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement.  

            (2)           That, for the purpose of determining any liability under the Securities Act, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
 
            (3)           To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.
 
(4)           Insofar as indemnification for liabilities arising under the Securities Act of 1933 (the “Act”) may be permitted to directors, officers and controlling persons of the small business issuer pursuant to the foregoing provisions, or otherwise, the small business issuer has been advised that in the opinion of the Securities and Exchange Commission, such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable.
 
-32-

 
   In the event that a claim for indemnification against such liabilities (other than the payment by the small business issuer of expenses incurred or paid by a director, officer or controlling person of the small business issuer in the successful defense of any action, suit or proceeding) is asserted by such director or controlling person in connection with the securities being registered, the small business issuer will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question of whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.
 
II-2
 
(5)           That, for the purpose of determining liability under the securities Act of 1933 to any purchaser:

(i)     Pursuant to Rule 430B:

                        (A)           Each prospectus filed by the registrant pursuant to Rule 424(b)(3) shall be deemed to be part of the registration statement as of the date the filed prospectus was deemed part of and included in the registration statement; and
 
                                   (B)            Each prospectus required to be filed pursuant to Rule 424(b)(2), (b)(5), or (b)(7) as part of a registration statement in reliance on Rule 430B relating to an offering made pursuant to Rule 415(a)(1)9i), (vii), or (x) for the purpose of providing the information required by section 10(a) of the Securities Act of 1933 shall be deemed to be part of and included in the registration statement as of the earlier of the date such form of prospectus is first used after effectiveness or the date of the first contract of sale of securities in the offering described in the p rospectus. As provided in Rule 430B, for liability purposes of the issuer and any person that is at that date an underwriter, such date shall be deemed to be a new effective date of the registration statement relating to the securities in the registration statement to which that prospectus relates, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.   Provided, however, that no statement made in a registration statement or prospectus that is part of the registration   statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such effective date, supersede or modify any statement that was made i n the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such effective date; or 

(ii)     Each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A (Section 230.430A of this chapter), shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness.  Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such first use, s upersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first use.
 
 (6)           That, for the purpose of determining liability of the registrant under the Securities Act of 1933 to any purchaser in the initial distribution of the securities:

The undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser:
 
-33-

 
        (i)           Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424;
 
        (ii)          Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant;
 
        (iii)         The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and


II-3
 
       (iv)         Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser.
 
(7)           Upon effectiveness of this registration statement, the Registrant will provide to DSS certificates in such denominations and registered in such names as required to permit prompt distribution to the named shareholders of DSS.
 
(8)            In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by a director, officer or controlling person of the Registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.
 
            (9)           The undersigned registrant hereby undertakes that:

     (i)                For purposes of determining any liability under the Securities Act of 1933, the information omitted from the form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this registration statement as of the time it was declared effective; and

     (ii)                For the purpose of determining any liability under the Securities Act of 1933, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
 
-34-

 
SIGNATURES
 
In accordance with the requirements of the Securities Act of 1933, the Registrant certifies that it has reasonable grounds to believe that it meets all of the requirements of filing on Form S-1 and authorized this registration statement to be signed on its behalf by the undersigned, in the City of Santa Monica, State of California on June 30, 2010 .
 
 
Internet Media Services, Inc.
   
 
By:   /s/ Raymond J. Meyers
 
Chief Executive Officer
 
 
In accordance with the requirements of the Securities Act of 1933, this registration statement was signed by the following persons in the capacities on June 30, 2010
 
/s/ Raymond J. Meyers
Chief Executive Officer and Principal Financial Officer and Director
Raymond J. Meyers
 
   
/s/ Michael Buechler
Executive Vice President and Director
Michael Buechler
 
   
/s/ Alexander A. Orlando
Director
Alexander A. Orlando
 
   
/s/ Patrick White
Director
Patrick White
 
   
/s/ Philip Jones
Director
Philip Jones
 

 
 
-35-

 

EXHIBIT INDEX

Exhibits.
 
 
3.1
Certificate of Incorporation of the Registrant, as amended (1)
 
3.2
By-laws of the Registrant (1)
 
5.1
Opinion on legality (Revised)
 
10.1
Lease (Santa Monica) (1)
 
10.2
Agreements with DSS with exhibits and schedules (Revised)
 
10.3
Revolving Credit Agreement
 
10.4
Security Agreement
 
10.5
Secured Promissory Note
 
23.1
Consent of  independent registered public accounting firm (Revised)
 
23.2
Consent of Gary A. Agron (See Exhibit 5.1)

 
 


 
-36-

 
EX-5.1 2 ex5-1.htm ex5-1.htm
Exhibit 5.1
LAW OFFICE OF GARY A. AGRON
5445 DTC Pkwy., Suite 520
Greenwood Village, Colorado  80111
Telephone:  (303) 770-7254
Facsimile:  (303) 770-7257
gaa@agronlaw.com
 
 
June 30, 2010

To:           Internet Media Services, Inc.
Re:           Registration Statement on Form S-1

Ladies and Gentlemen:

        We are counsel for Internet Media Services, Inc., a Delaware corporation (the “Company”), in connection with the proposed public offering under the Securities Act of 1933, as amended, of up to an aggregate of 7,500,000 shares of its $0.001 par value common stock (“Common Stock”) to be distributed to the shareholders, pro rata, of Document Security Systems, Inc. through a Registration Statement on Form S-1 (“Registration Statement”) as to which this opinion is a part, to be filed with the Securities and Exchange Commission (the “Commission”).

        In connection with rendering our opinion as set forth below, we have reviewed and examined originals or copies identified to our satisfaction of the following:
 
        (1)   Certificate of Incorporation and amendments thereto, of the Company as filed with the Secretary of State of the state of Delaware;
        (2)   Corporate minutes containing the written deliberations and resolutions of the Board of Directors and shareholders of the Company;
        (3)   The Registration Statement and the Preliminary Prospectus contained within the Registration Statement;
        (4)   The other exhibits of the Registration Statement; and
        (5)  All relevant statutory provisions under Delaware law, all applicable Delaware Constitutional provisions and all reported judicial decisions interpreting such statutory and Constitutional provisions.

        We have examined such other documents and records, instruments and certificates of public officials, officers and representatives of the Company, and have made such other investigations as we have deemed necessary or appropriate under the circumstances.

        Based upon the foregoing and in reliance thereon, it is our opinion that the Common Stock offered under the Registration Statement is fully paid, non-assessable and lawfully issued under Delaware law.

        We hereby consent to the use of this opinion as an exhibit to the Registration Statement and to the use of our name under the caption “Legal Matters” in the prospectus constituting a part thereof.

Very truly yours,

/s/ Gary A. Agron
Gary A. Agron

 
-1-

 
EX-10.2 3 ex10-2.htm ex10-2.htm
Exhibit 10.2
 
 
 
 
 
ASSET PURCHASE AGREEMENT


by and between


INTERNET MEDIA SERVICES, INC.,

as Buyer,


and


LESTER LEVIN INC.,

as Seller


Dated October __, 2009
 
 
 
 
 
-1-

 
Table of Contents
 
    Page
ARTICLE I.
DEFINITIONS
5
1.1
Definitions
5
ARTICLE II.
PURCHASE AND SALE
8
2.1
Purchase and Sale
8
2.2
Excluded Assets
9
2.3
Assumed Liabilities
9
2.4
Closing
9
ARTICLE III.
CONSIDERATION
11
3.1
Purchase Price
11
3.2
Legend on IMS Common Certificate
11
3.3
Allocation of Purchase Price
11
ARTICLE IV.
REPRESENTATIONS AND WARRANTIES OF SELLER
11
4.1
Organization, Qualification and Authority
12
4.2
No Violations
12
4.3
Real Property
12
4.4
Personal Property
12
4.5
Contracts
12
4.6
Litigation
12
4.7
Intellectual Property
12
4.8
Insurance
12
4.9
Environmental Laws
12
4.10
Tax Returns; Taxes
15
4.11
Affiliate Interests
15
ARTICLE V.
REPRESENTATIONS AND WARRANTIES OF BUYER
16
5.1
Organization, Qualification and Authority
16
5.2
No Violations
16
5.3
Broker’s or Finder’s Fee
16
5.4
Working Capital
17
5.5
IMS Common Stock
17
5.6
Capitalization
17
5.7
Contracts and other Commitments
17
5.8
Registration Rights
18
5.9
Litigation
18
5.10
Absence of Borrowed Indebtedness and Assets; Unclosed Liabilities
18
5.11
Material Liabilities
18
5.12
Environmental Laws
18
5.13
Tax Returns; Taxes
19
5.14
Disclosure
19
 
 
-2-

 
ARTICLE VI.
CERTAIN COVENANTS
19
6.1
Further Assurances
19
6.2
Board of Directors
19
6.3
Working Capital
19
6.4
Registration of Shares
20
6.5
Certain Employee Matters
20
6.6
Extension of Health and Dental Insurance
20
6.7
Non-Competition, Non-Disclosure, Non-Solictation
20
6.8
Corporate Existence
22
6.9
Certain Negative Covenants; Misc.
22
6.10
D&O Insurance
24
ARTICLE VII.
INDEMNIFICATION
24
7.1
Indemnification
24
7.2
Indemnification Procedures – Third Party Claims
24
7.3
Indemnification Procedures – Other Claims, Indemnification Generally
26
ARTICLE VIII.
MISCELLANEOUS
26
8.1
Publicity
26
8.2
Entire Agreement
26
8.3
Notices
27
8.4
Non-Assignable Assets
28
8.5
Waivers and Amendments
28
8.6
Survival
28
8.7
Counterparts
28
8.8
Governing Law; Severability
28
8.9
Assignment
28
8.10
Negotiated Agreement
29
8.11
Expenses; Taxes
29
8.12
Third Party Beneficiary
29
8.13
Headings
29
 
 
 
 

 
 
-3-

 

EXHIBITS
   
 
 
Exhibit A
Copyrights and Trademarks
 
Exhibit B
Form of Assignment of Domain Name
 
Exhibit C
Form Bill of Sale
 
Exhibit D
Form Registration Rights Agreement
 
Exhibit E
Form Voting Agreement
 
Exhibit F
Form Stock Pledge and Escrow Agreement
 
Exhibit G
Form Lock-Up Agreement
 
Exhibit H
Assignment and Assumption Agreement
 


SCHEDULES

Schedule 2.1(a)
Equipment
Schedule 2.1(b)
Inventory
Schedule 2.1(c)
Contracts
Schedule 2.1(e)
Proprietary Rights
Schedule 2.1 (f)
Trade Accounts Receivable
Schedule 2.1(h)
Cash and Cash Equivalents
Schedule 2.2
Excluded Assets
Schedule 2.3
Assumed Liabilities
Schedule 2.4(a)(v)
Closing Balance Sheet
Schedule 3.3
Purchase Price Allocation
Schedule 4.1
Shareholders of Seller
Schedule 4.2
Consent
Schedule 4.6
Litigation
Schedule 4.7
Intellectual Property
Schedule 4.8
Insurance
Schedule 4.11
Affiliate Interests
Schedule 5.6
IMS Stockholders
 
 
 

 
 
-4-

 
ASSET PURCHASE AGREEMENT


ASSET PURCHASE AGREEMENT (“Agreement”) dated October __, 2009 (the “Effective Date”), by and among Internet Media Services, Inc., a Delaware corporation (“Buyer”), and Lester Levin Inc., a New York corporation (“Seller”).
 
R E C I T A L S:
 
WHEREAS, Seller markets and sells legal supplies, legal forms and legal documents through the Internet Web site named LegalStore.com (the “Business”);
 
WHEREAS, Seller wishes to sell the certain assets of the LegalStore.com to the Buyer, and Buyer is willing to acquire certain assets of the LegalStore.com;
 
NOW, THEREFORE, in consideration of the premises and mutual covenants contained in this Agreement and of other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties, intending to be legally bound hereby, agree as follows:
 
Article I.  Definitions
 
1.1           Definitions.  For purposes of this Agreement, the following terms shall have the respective meanings set forth below:
 
Affiliate” of any specified Person means (i) any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person and (ii) any 5% stockholder or member of such Person.  For purposes of this definition, “control” when used with respect to any specified Person means the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise, and the terms “controlling” and “controlled” have meanings correlative to the foregoing.
 
Agreement” means this Agreement and includes all of the schedules and exhibits annexed hereto.
 
Allocation” has the meaning set forth in Section 3.3.
 
Acquired Assets” has the meaning set forth in Section 2.1.
 
Assignment and Assumption Agreement” has the meaning set forth in Section 2.4(b)(ix).
 
Assumed Liabilities” has the meaning set forth in Section 2.3.
 
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Bill of Sale” means a Bill of Sale from Seller in the form of Exhibit C attached hereto and incorporated by this reference.
 
Business” has the meaning set forth in the recitals to this Agreement.
 
Business Books and Records” has the meaning set forth in Section 2.1(g).
 
By-Laws” has the meaning set forth in Section 5.6.
 
Certificate of Incorporation” has the meaning set forth in Section 5.6.
 
Closing” means the closing of the purchase and sale of the Acquired Assets contemplated by this Agreement.
 
Closing Balance Sheet” means the pro forma balance sheet of the Business dated as of the Closing Date.
 
Closing Date” means the Effective Date or such other time as Buyer and Seller mutually agree.
 
Code” means the Internal Revenue Code of 1986, as amended.
 
Contracts” has the meaning set forth in Section 2.1(c).
 
DSS” has the meaning set forth in Section 3.1.
 
Effective Date” means the date hereof.
 
Encumbrance” means any lien, charge, security interest, mortgage, pledge or other encumbrance of any nature whatsoever.
 
Environmental Laws” has the meaning set forth in Section 4.9.
 
Equipment” has the meaning set forth in Section 2.1 (a).
 
Excluded Assets” means all of the other assets of Seller that are specifically set forth on Schedule 2.2, and are not part of the Acquired Assets.
 
Excluded Liabilities” means all liabilities and obligations of Seller, except for Assumed Liabilities set forth in Section 2.3.
 
Former Real Property” has the meaning set forth in Section 4.9.
 
IMS Common Stock” has the meaning set forth in Section 3.1.
 
Indemnification Acknowledgement” has the meaning set forth in Section 7.2(a)(ii).
 
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Indemnitee” has the meaning set forth in Section 7.2(a).
 
Indemnitor” has the meaning set forth in Section 7.2(a).
 
 “Inventories” has the meaning set forth in Section 2.1(b).
 
Lock-Up Agreement” has the meaning set forth in Section 2.4(b)(vii).
 
Losses” means any and all out-of-pocket damages, costs, liabilities, losses (including consequential losses), judgments, penalties, fines, expenses or other costs, including reasonable attorney’s fees, incurred by an Indemnitee.
 
Material Adverse Effect” means a material adverse effect on either (i) the assets, operations, personnel, condition (financial or otherwise) or prospects of  Seller, taken as a whole, or (ii) any of Seller’s or Buyer’s (as applicable) ability to consummate the transactions contemplated hereby.
 
Notice of Claim” has the meaning set forth in Section 7.2(a)(i).
 
Person” means any individual, partnership, limited liability company, limited liability partnership, corporation, association, joint stock company, trust, joint venture, unincorporated organization, governmental entity (or any department, agency or political subdivision thereof) or any other type of legal entity.
 
Pledge Agreement” has the meaning set forth in Section 2.4(b)(vi).
 
Proprietary Rights” has the meaning set forth in Section 2.1(e).
 
Purchase Price” has the meaning set forth in Section 3.1.
 
Permits” has the meaning set forth in Section 2.1(d).
 
Real Property” has the meaning set forth in Section 4.9.
 
Registration Statement” has the meaning set forth in Section 6.5.
 
Securities Act” means the Securities Act of 1933, as amended.
 
Tax” means any federal, state, local or foreign income, gross receipts, license, payroll, employment, excise, severance, stamp, occupation, premium, windfall profits, capital gain, intangible, environmental (pursuant to Section 59A of the Code or otherwise), custom duties, capital stock, franchise, employee’s income withholding, foreign withholding, social security (or its equivalent), unemployment, disability, real property, personal property, sales, use, transfer, value added, registration, alternative or add-on minimum, estimated or other tax, including any interest, penalties or additions to tax in respect of the foregoing, whether disputed or not, and any obligation to indemnify, assume or succeed to the liability of any other Person in respe ct of the foregoing.
 
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Tax Return” means any return, declaration, report, claim for refund, or information return or statement relating to Taxes, including any schedule or attachment thereto, and including any amendment thereof.
 
Third Party Claim” means a claim or demand made by any Person who is not a party hereto against an Indemnitee.
 
Voting Agreement” has the meaning set forth in Section 2.4(a)(iii).
 
Whole Board” means the total number of directors which the Buyer’s Board of Directors would have if there were no vacancies.
 
Article II.  Purchase and Sale
 
2.1           Purchase and Sale.  Subject to Section 2.2, Seller agrees to sell, transfer, assign, convey and deliver to Buyer, and Buyer agrees to purchase from Seller, free and clear of all Encumbrances at the Closing for the consideration specified below in Article III,  all right, title and interest of Seller in and to the following properties, assets and rights primarily related to or used or held for use or sale by the Seller in connection with the Business as they exist on the Closing Date (collectively, the “Acquired Assets”):
 
(a)            All machinery, equipment, tools, vehicles, furniture, furnishings, leasehold improvements, and similar property listed on Schedule 2.1(a), which is attached and incorporated by reference (collectively, the “Equipment”);
 
(b)            All inventories of raw materials, work in process, finished products, goods, spare parts, replacement and component parts, and office and other supplies (collectively, the “Inventories”) wherever held or stored and as listed on Schedule 2.1(b) to be attached and incorporated by reference as of the close of business on the day immediately preceding the Closing Date;
 
(c)            All of Seller’s rights under all contracts, commitments, understandings, leases and agreements listed on Schedule 2.1(c) which is attached and incorporated by reference (collectively, the “Contracts”), including security deposits related thereto, Seller’s right to receive payment for products sold pursuant to, and to receive goods and services pursuant to, such contracts and to assert claims and take other rightful actions to enforce the Contracts;
 
(d)            To the extent permitted by law, all governmental licenses, permits, approvals, applications or registrations (collectively the “Permits”);
 
(e)            Any patents, trademarks, service marks or trade names, copyrights, websites, domain names, URL’s and customer lists and databases of Seller, together with all related applications or registrations listed on Schedule 2.1(e) which is attached and incorporated by reference (collectively, the “Proprietary Rights”);
 
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(f)            All trade accounts receivable arising out of the conduct of the Business by the Seller prior to the Closing as listed on the Closing Balance Sheet;
 
(g)           All books, records, manuals and other materials related solely to the Acquired Assets and the operation of the Business, including sales and advertising materials, sales and purchase correspondence, and customer records and files (the “Business Books and Records”); and
 
(h)           All cash and cash equivalents in Seller’s account at Bank of America, Account No. 009442661376, as of the Closing Date, as adjusted in Seller’s sole discretion for (i) any uncleared checks and deposits in transit outstanding as of the Closing Date within five (5) business days after the Closing under customary bank reconciliation and (ii) such amounts to cover any bank or credit card fees.
 
Buyer acknowledges that it has fully inspected the Acquired Assets.  Except as set forth in Article IV, the tangible Assets are being sold to Buyer in their present physical condition, “AS IS,” “WHERE IS,” “WITH ALL FAULTS,” and WITH NO WARRANTIES, INCLUDING THE IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE with respect to the physical condition of the tangible Acquired Assets, and subject to normal wear and tear on the Acquired Assets up to the Closing Date.
 
2.2           Excluded Assets.  For the avoidance of doubt, the following are not included in the Acquired Assets and Seller is not selling and Buyer is not purchasing or assuming any obligations with respect to the following assets of Seller (the “Excluded Assets”), and following Closing, Buyer will not have any right, title, interest or obligation with respect to the Excluded Assets:
 
(a)            Cash or cash equivalents, except as provided in Section 2.1(h);
 
(b)            The corporate seals, certificates of incorporation, minute books, stock books, tax returns, books of account or other records having to do with the corporate organization of Seller and the remaining operations and businesses conducted by Seller;
 
(c)             The rights to any of Seller’s claims for any federal, state, local or foreign tax refunds; and
 
(d)            The assets, properties or rights relating to the remaining operations and businesses conducted by Seller and more fully set forth on Schedule 2.2 attached hereto and incorporated by reference.
 
2.3           Assumed Liabilities.  Buyer will not assume any liabilities of Seller, known or unknown, contingent or matured, except as described on Schedule 2.3 attached hereto and incorporated by this reference (the “Assumed Liabilities”).
 
2.4           Closing.  The Closing shall take place on the Closing Date at the offices of Seller, or at such other place or at such other time as Buyer and Seller shall agree.  The parties agree that in the event they do not meet physically to close this transaction that faxed and couriered executed documents shall be acceptable to close this transaction.
 
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(a)            On the Closing Date Seller shall deliver to Buyer the following:

(i)           One or more instruments of assignment and bills of sale dated the Closing Date, in form and substance reasonably satisfactory to Buyer, conveying to Buyer all of Seller’s right, title and interest in and to the Acquired Assets.

(ii)           A Registration Rights Agreement, in the form attached hereto as Exhibit D, executed on behalf of DSS and Seller.

(iii)          A Voting Agreement, in the form attached hereto as Exhibit E, executed on behalf of DSS.

(iv)          Pledge Agreements, in the form attached hereto as Exhibit F, executed on behalf of DSS and Lester Levin Inc.

(v)           Closing Balance Sheet, attached hereto as Schedule 2.4(a)(v).

(b)           On the Closing Date Buyer shall deliver to Seller the following:

(i)            The Purchase Price specified in Section 3.1 below by delivery of certificates representing the IMS Common Stock (defined below) issuable to DSS hereunder.

(ii)           A certificate of an officer duly authorized to provide the same, together with true and correct copies of a resolution of the Board of Directors of Buyer authorizing Buyer to enter into and consummate the transactions contemplated by this Agreement and certified Certificate of Incorporation and By-Laws of Buyer, together with a Good Standing Certificate issued by the State of Delaware, and the names of the other officer or officers of Buyer authorized to sign this Agreement, together with a sample of the true signature of each such officer.

(iii)          An opinion of counsel to Buyer, dated the Closing Date and addressed to Seller, in form and substance satisfactory to Seller.

(iv)          A Registration Rights Agreement, in the form attached hereto as Exhibit D, executed on behalf of Buyer.

(v)           A Voting Agreement, in the form attached hereto as Exhibit E, executed on behalf of Buyer and the IMS Stockholders.

(vi)          Pledge Agreements, in the form attached hereto as Exhibit F, executed on behalf of the IMS Stockholders.

(vii)         A Lock-Up Agreement, in the form attached hereto as Exhibit G, executed on behalf of the IMS Stockholders.
 
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(viii)        The original stock certificates issued to Buyer’s shareholders representing the IMS Common Stock shares pledged under the Pledge Agreements, to be held by an escrow agent of Seller’s choice.

(ix)          An assignment and assumption agreement with respect to the Assumed Liabilities, in the form attached hereto as Exhibit H.

(c)               On the Closing Date, Seller and Buyer shall deliver to each other the agreements which are required to be executed and delivered under the terms and conditions of this Agreement and in the form attached to this Agreement.
 
Article III.  Consideration
 
3.1           Purchase Price.  In consideration of the sale and transfer of the Acquired Assets, on the Closing Date, Buyer shall issue to Seller’s designee, Document Security Systems, Inc., a New York corporation (“DSS”), 7,500,000 shares of newly-issued common stock, par value $.001 per share, of Buyer (“IMS Common Stock”) (the “Purchase Price”), which DSS intends to distribute as part of this transaction in accordance with applicable securities laws.
 
3.2           Legend on IMS Common Stock Certificate.  Each certificate representing shares issued pursuant to this Agreement shall be endorsed with the following legend:
 
“THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), AND MAY NOT BE SOLD, TRANSFERRED, ASSIGNED OR HYPOTHECATED UNLESS THERE IS AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT COVERING SUCH SECURITIES, THE SALE IS MADE IN ACCORDANCE WITH RULE 144 OR ITS SUCCESSOR RULE UNDER THE ACT, OR THE COMPANY RECEIVES AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT EXEMPTIONS FROM SUCH REGISTRATION ARE AVAILABLE.”

3.3           Allocation of Purchase Price.  The Purchase Price shall be allocated among the Acquired Assets in the manner set forth in Schedule 3.3.  The Purchase Price shall be deemed for all purposes (e.g., those relating to Taxes and tax returns of any kind whatsoever, including, without limitation, Internal Revenue Service Form 8594) to be allocated in accordance with the allocation schedule to be mutually prepared by Buyer and Seller and attached hereto as Schedule 3.3 within sixty (60) days after the Closing Date.  Neither Buyer, Seller nor any of their affiliates shall take any position (whether in audits, Tax Returns or otherwise) that is inconsistent with such allocation unless required to do so by applicable law.
 
Article IV.  Representations and Warranties of Seller
 
As a material inducement to Buyer to enter into this Agreement and to consummate the transactions contemplated hereby, Seller represents and warrants to Buyer as follows:
 
 
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4.1           Organization, Qualification and Authority.  The Seller is a corporation duly organized and validly existing under the laws of the State of New York, and is in good standing and duly qualified to do business as a foreign corporation in all jurisdictions where the operation of its respective business or the ownership of its respective properties make such qualification necessary.  Seller has full power and authority to own, lease and operate their facilities and assets as presently owned, leased and operated, and to carry on their business as they are now being conducted.  Seller owns no capital stock, security, interest or other right, or any option or warrant convertible in to the same, of any Person.  The shareholders of Seller as of the date hereof are set forth on Schedule 4.1.  Seller has the full right, power and authority to execute, deliver and carry out the terms of this Agreement and all documents and agreements necessary to give effect to the provisions of this Agreement and to consummate the transactions contemplated hereby.  The execution, delivery and consummation of this Agreement, and all other agreements and documents executed in connection herewith by Seller, have been duly authorized by all necessary action on the part of Seller.  No other action, consent or approval on the part of Seller or any other Person or entity is necessary to authorize each of Seller’s due and valid execution, delivery and consummation of this Agreement and all other agreements and documents executed in connection herewith.  This Agreement and all other agreemen ts and documents executed in connection herewith by Seller, upon due execution and delivery thereof, shall constitute the valid and binding obligations of Seller, enforceable in accordance with their terms, except as enforcement may be limited by bankruptcy, insolvency, reorganization or similar laws affecting creditors’ rights generally and by general principles of equity.
 
4.2           No Violations.  Except as set forth on Schedule 4.2 attached hereto, the execution and delivery of this Agreement and the performance by Seller of their obligations hereunder, to the best knowledge of Seller (i) do not and will not conflict with or violate any provision of the articles of incorporation, bylaws, or similar organizational documents of Seller, and (ii) do not and will not (a) conflict with or result in a breach of the terms, conditions or provisions of, (b) constitute a default under, (c) result in the creation of any Encumbrance upon the capital stock or assets of Seller pursuant to, (d) give any third party the right to modify, terminate or acceler ate any obligation under, (e) result in a violation of, or (f) require any authorization, consent, approval, exemption or other action by or notice to any court or administrative, arbitration or governmental body or other third party pursuant to, any law, statute, rule or regulation or any contract, judgment or decree to which Seller is subject or by which any of its assets are bound.
 
4.3           Real Property.  Seller does not own any real property, but does lease real property located at 320 North Goodman Street, Suite 209, Rochester, New York 14607.
 
4.4           Personal Property.  Seller has good and marketable title to the Acquired Assets free and clear of all Encumbrances.
 
4.5           Contracts.  Except as set forth on Schedule 2.1, Seller is not a party to any contract in which the Acquired Assets are subject.
 
4.6           Litigation.  Except as set forth on Schedule 4.6 (for which Buyer assumes no liability), Seller has not received notice of any violation of any law, rule, regulation, ordinance or order of any court or federal, state, municipal or other governmental department, commission, board, bureau, agency or instrumentality (including, without limitation, legislation and regulations applicable to environmental protection, civil rights, public health and safety and occupational health).  Except as set forth on Schedule 4.6 (for which Buyer assumes no liability), there are no lawsuits, proceedings, actions, arbitrations, governmental investigations, claims, inquiries or proceedings pending or, to each of the Seller’s knowledge, threatened involving Seller, any of the Acquired Assets or the Business, and no reasonable basis exists for the bringing of any such claim.  At Closing, Seller shall indemnify and hold Buyer harmless from any Losses incurred by Buyer as a result of the litigation described on Schedule  4.6.
 
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4.7           Intellectual Property.  All Proprietary Rights owned by Seller, and used in connection with the Business are listed and described in Schedule 4.7.  No proceedings have been instituted or are pending or, to each of the Seller’s knowledge, threatened which challenge the validity of the ownership by Seller of any such Proprietary Rights.  Other than to Buyer, Seller has not licensed anyone to use any such Proprietary Rights and, to each of the Seller’s knowledge, there has been no use or infringement of any of such Proprietary Rights by any other person.
 
4.8           Insurance.  Seller has in effect and has continuously maintained insurance coverage for all of its operations, personnel and assets, and for the Acquired Assets and the Business.  A complete and accurate list of all such insurance policies is set forth in Schedule 4.8, which policies have previously been provided to Buyer.  Schedule 4.8 also sets forth a summary of Seller’s current insurance coverage (listing type, carrier and limits), and includes a list of any pending insurance claims relating to Seller.  Seller is not in default or breach with respect to any provision contained in any such insurance policies, nor has Seller failed to give any notice or to present any claim thereunder in due and timely fashion.
 
4.9           Environmental Laws.  All of the Permits required under Environmental Laws for the operation of the Business have been obtained and maintained in effect in good standing by Seller.  No material change in the facts or circumstances reported or assumed in the applications for such Permits exists. Seller is in compliance, and at all times has complied, with all Environmental Laws applicable to the operations associated with the Business and each of the properties currently owned, leased or operated by Seller (the “Real Property”) and each of the properties formerly owned, leased or operated by Seller (the “Former Real Property”) and with all of the Permits. & #160;Seller is not aware of any violation with respect to any of the Permits, which violations are outstanding or uncured as of the date hereof, and no proceeding is pending, or to Seller’s knowledge, threatened, to revoke or limit any of the Permits.
 
Seller has not performed or suffered any act which could give rise to, or has otherwise incurred, liability to any Person, including itself, under the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. § 9601 et seq. (“CERCLA”) or any of the Environmental Laws, nor does Seller have notice of any such liability or any claim therefor or submitted notice pursuant to Section 103 of CERCLA to any Governmental Authority nor provided information in response to a request for information pursuant to Section 104(e) of CERCLA or any analogous state or local information gathering authority.

Since November 2005, no Hazardous Substances has been released, placed, dumped, disposed of, manufactured, stored or otherwise come to be located in, on, at, beneath or near any of the Real Property or the Former Real Property or any surface waters or groundwaters thereon or thereunder in excess of the levels prescribed or permitted under Environmental Laws.

 
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To Seller’s knowledge, there have been and are no aboveground or underground storage tanks, polychlorinated biphenyls or asbestos-containing materials located at or within the Real Property or the Former Real Property.

To Seller’s knowledge, none of the Real Property or the Former Real Property is identified or proposed for listing on the National Priorities List under 40 C.F.R. § 300 Appendix B, the Comprehensive Environmental Response Compensation and Liability Inventory System (“CERCLIS”) or any analogous list of any Government Authority and Seller is not aware of any conditions on such properties which, if known to a Governmental Authority, would qualify such properties for inclusion on any such list.

None of the Real Property or the Former Real Property, or any current or previous business operations conducted by Seller, is the subject of any pending or threatened investigation or judicial or administrative proceeding, notice, decree or settlement respecting any actual, potential or alleged violation of any Environmental Law, or any Releases of Hazardous Substances into any surface water, ground water, drinking water supply, soil, land surface or subsurface strata, or ambient air (the “Environment”). Seller has not received from any Governmental Authority, insurance company or other Person, any request for information that Seller is the subject of an investigation under Environmental Laws, notice of any potential or alleged violations of any Environmental Laws or of any proposed order under any Environmental Laws or any order or proposed order requiring any of such parties to prepare studies, action plans, or clean-up strategies in respect of an Environmental Condition on any of the Real Property or the Former Real Property.  Seller has not received notice of any inquiry or investigation by any Person concerning matters regulated by Environmental Laws.

Seller has not reported any violation of any applicable Environmental Laws to any Governmental Authority.  Since November 2005, no Releases have occurred on any of the Real Property or Former Real Property which would require reporting to any Governmental Authority under any Environmental Laws.

Seller has not sent, transported, or directly arranged for the transport of any garbage, solid waste or Hazardous Substances, whether generated by Seller or another Person, to any site listed on the National Priorities List or proposed for listing on the National Priorities List or to a site included on the CERCLIS list or any analogous state list of sites.

There is not now, nor to Seller’s knowledge has there ever been, on or in any Real Property or Former Real Property, any generation, treatment, recycling, storage or disposal of any hazardous waste, as that term is defined under 40 C.F.R. Part 261 or any state or foreign equivalent, except in accordance with Environmental Laws.

 
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“Hazardous Substances” means and includes any flammable explosives, radioactive materials or hazardous, toxic or dangerous wastes, substances or related materials or any other chemicals, materials or substances, exposure to which is prohibited, limited or regulated by any federal, state, county, regional or local authority including, but not limited to, asbestos, PCBs, petroleum products and by-products (including, but not limited to, crude oil or any fraction thereof, natural gas, natural gas liquids, liquefied natural gas, or synthetic gas usable for fuel, or any mixture thereof), substances defined or listed as “hazardous substances”, “hazardous materials”, ‘‘hazardous wastes”, “toxic substances”, “hazardous air pollutants” or ‘‘waste’ 217; or similarly identified in, pursuant to, or for purposes of, any Environmental Laws applicable to the operations of the Buyer or Seller’s respective businesses or real property, as applicable, and each of the properties formerly owned, leased or operated by Seller or Buyer, and with all associated permits, as applicable.
 
“Environmental Laws” means all federal, state and local environmental, health or safety laws, ordinances, regulations, rules of common law or policies regulating Hazardous Substances, including, without limitation, those governing the generation, use, refinement, handling, treatment, removal, storage, production, manufacture, transportation or disposal of Hazardous Substances, to the extent such laws, ordinances, regulations, rules and policies may be in effect from time to time and be applicable to the operations of Buyer or Seller’s respective businesses, or Real Property, as applicable, and each of the properties formerly owned, leased or operated by Seller or Buyer, as applicable, and with all associated permits, including, without limitation, the Hazardous Materials Transportation Act, as now or hereafter amended (49 U.S.C. Section 1801, et seq.); the Resource Conservation and Recovery Act, as now or hereafter amended (42 U.S.C. Section 6901, et seq.); the Toxic Substance Control Act of 1976, as now or hereafter amended (15 U.S.C. Section 2601 et seq.); the Clean Water Act, as now or hereafter amended (33 U.S.C. Section 1251 et seq.); the Clean Air Act, as now or hereafter amended (42 U.S.C. Section 7901 et seq.); any so-called “Superfund” or “Superlien” law; or any other federal, state or local statute, law, ordinance, code, rule, regulation, order or decree regulating, relating to or imposing liability or standards of conduct concerning any hazardous, toxic or dangerous waste, substance or material.
 
4.10           Tax Returns; Taxes.  DSS, on behalf of the consolidated group of which Seller is a member, has filed or will timely file all federal, state and local Tax Returns and Tax reports required by such authorities to be filed through September 30, 2009.  DSS has paid all Taxes, assessments, governmental charges, penalties, interest and fines due or claimed to be due by any federal, state or local authority through September 30, 2009.  There is no pending Tax examination or audit of, nor any action, suit, investigation or claim asserted or, to Seller’s knowledge, threatened against any Seller by any federal, state or local authority; and DSS has not been granted any extensio n of the limitation period applicable to any Tax claims.  All Taxes, assessments, governmental charges, penalties, interest and fines due or claimed to be due by any federal, state or local authority prior to or after September 30, 2009 by Seller with respect to the operation of the Business prior to the Closing shall be the responsibility of Seller and shall be paid by Seller.
 
4.11           Affiliate Interests.  Except as set forth on Schedule 4.11, Seller is not a party to any transaction with any Person or Affiliate that establishes any right or interest in any of the Acquired Assets.
 
 
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Article V.  Representations and Warranties of Buyer
 
As an inducement to Seller to enter into this Agreement and to consummate the transactions contemplated hereunder, Buyer hereby represents and warrants to Seller and DSS as follows:
 
5.1           Organization, Qualification and Authority.  Buyer, and its wholly-owned subsidiary Legal Store.Com, Inc., are each corporations duly formed, validly existing and in good standing under the laws of the State of Delaware.  Buyer has the requisite corporate power and authority to own, lease and operate its properties and assets as presently owned, leased and operated and to carry on its business as it is now being conducted.  Buyer has the full corporate right, power and authority to execute, deliver and carry out the terms of this Agreement and all documents and agreements necessary to give effect to the provisions of this Agreement and to consummate the transactions contempl ated on the part of Buyer hereby.  The execution, delivery and consummation of this Agreement and all other agreements and documents executed in connection herewith by Buyer has been duly authorized by all necessary corporate action on the part of Buyer.  No other action, consent or approval on the part of Buyer, any stockholder of Buyer, or any other person or entity is necessary to authorize the execution, delivery and consummation of this Agreement and all other agreements and documents executed in connection herewith.  This Agreement, and all other agreements and documents executed in connection herewith by Buyer, upon due execution and delivery thereof, shall constitute the valid binding obligations of Buyer, enforceable in accordance with their respective terms, except as enforcement may be limited by bankruptcy, insolvency, reorganization or similar laws affecting creditors’ rights generally and by general principles of equity.  Other than Legal Store.Com, Inc., Buyer does not own or control, directly or indirectly, any interest in any other corporation, association, or other business entity.  Buyer is not a participant in any joint venture, partnership, or similar agreement.
 
5.2           No Violations.  The execution and delivery of this Agreement and the performance by Buyer of its obligations hereunder (i) do not and will not conflict with or violate any provision of the articles of incorporation or similar organizational documents of Buyer or its subsidiary, and (ii) do not and will not (a) conflict with or result in a breach of the terms, conditions or provisions of, (b) constitute a default under, (c) result in the creation of any Encumbrance upon the membership interests of Buyer pursuant to, (d) give any third party the right to modify, terminate or accelerate any obligation under, (e) result in a violation of, or (f) require any authorizat ion, consent, approval, exemption or other action by or notice to any court or administrative, arbitration or governmental body or other third party pursuant to, any law, statute, rule or regulation or any contract, order, judgment or decree to which Buyer or its subsidiary is subject or by which any of its assets are bound.
 
5.3           Broker’s or Finder’s Fee.  Buyer has not employed nor is Buyer liable for the payment of any fee to, any finder, broker, consultant or similar person in connection with the transactions contemplated under this Agreement.
 
 
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5.4           Working Capital. Buyer represents that it has access to sufficient working capital of at least $200,000 over the six (6) month period immediately following the Closing Date of this Agreement in order to execute the provisions of this Agreement.
 
5.5           IMS Common Stock.  Buyer represents and warrants that it will deliver to the Seller’s designee the IMS Common Stock free and clear of all mortgages, liens, liabilities, security interests, pledges, restrictions, prior assignments, leases, licenses, charges, claims, defects in title and title and encumbrances of any kind or type whatsoever. Upon issuance the IMS Common Stock will be validly issued, fully paid and non-assessable, and free from all taxes, liens, claims and encumbrances other than securities law restrictions and shall not be subject to preemptive rights or other similar rights of stockholders of IMS.
 
5.6           Capitalization.  The total authorized capital stock of Buyer consists of 25,000,000 shares of IMS Common Stock, of which 13,001,000 shares are outstanding as of the date hereof. The current stockholders of Buyer and the amount of IMS Common Stock held by each is set forth on Schedule 5.6 attached hereto. There are no outstanding securities which are convertible into shares of IMS Common Stock, whether such conversion is currently convertible or convertible only upon some future date or the occurrence of some event in the future.  All of such outstanding shares of capital stock are duly authorized, validly issued, fully paid and nonassessable.  No shares of capital stock of Buyer are subject to preemptive rights or any other similar rights of the stockholders of Buyer or any liens or encumbrances imposed through the actions or failure to act of Buyer. As of the Effective Date of this Agreement, (i) there are no outstanding options, warrants, scripts, rights to subscribe for, puts, calls, rights of first refusal, agreements, understandings, claims or other commitments or rights of any character whatsoever relating to, or securities or rights convertible into or exchangeable for any shares of capital stock of Buyer or any of its subsidiaries, or arrangements by which Buyer or any of its subsidiaries is or may become bound to issue additional shares of capital stock of Buyer or any of its subsidiaries, (ii) there are no agreements or arrangements under which Buyer or any of its subsidiaries are obligated to register the sale of any of its or their securities under the Securities Act and (iii) there are no anti-dilution or price adjustment provisions contained in any security issue d by Buyer (or in any agreement providing rights to security holders) that will be triggered by the issuance of the IMS Common Stock  Buyer has furnished to Seller and DSS true and correct copies of Buyer’s and its subsidiary’s Certificate of Incorporation as in effect on the date hereof (“Certificate of Incorporation”), Buyer’s and its subsidiary’s By-laws, as in effect on the date hereof (the “By-Laws”), and the terms of all securities convertible into or exercisable for any capital stock of Buyer and the material rights of the buyers thereof in respect thereto. No further approval or authorization of any stockholder, the Board of Directors of Buyer or others is required for the issuance and sale of the IMS Common Stock.  There are no stockholders agreements, voting agreements or other similar agreements with respect to Buyer’s or its subsidiary’s capital stock to which Buyer is a party or, to the knowledge of Buyer, between or among any of Buyer’s stockholders.
 
5.7           Contracts and Other Commitments.  Buyer and its subsidiary, Legal Store.Com, Inc., does not have any contract, agreement, lease, commitment, or proposed transaction, written or oral, absolute or contingent.
 
 
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5.8           Registration Rights. Except as provided in the Registration Rights Agreement, Buyer is not obligated to register under the Securities Act any of its presently outstanding securities or any of its securities that may subsequently be issued.
 
5.9           Litigation.  Buyer has not received notice of any violation of any law, rule, regulation, ordinance or order of any court or federal, state, municipal or other governmental department, commission, board, bureau, agency or instrumentality (including, without limitation, legislation and regulations applicable to environmental protection, civil rights, public health and safety and occupational health).  There are no lawsuits, proceedings, actions, arbitrations, governmental investigations, claims, inquiries or proceedings pending or, to Buyer’s knowledge, threatened involving Buyer or its subsidiary, or any of their assets or capital stock, and no reasonable basis exists for the b ringing of any such claim.
 
5.10           Absence of Borrowed Indebtedness and Assets; Undisclosed Liabilities. Neither Buyer nor its subsidiary have any indebtedness for borrowed money.  Immediately prior to the Closing, Buyer and its subsidiary will have no material tangible assets.  There is no real property owned or leased by Buyer or its subsidiary.  Buyer currently operates out of office space located at 4553 Glencoe Ave., Suite 325, Marina del Rey, California 90292, which is utilized by permission from an unrelated third party for no consideration.  Raymond Meyers and Michael Buechler  are Buyer’s sole employees.
 
5.11           Material Liabilities.  Neither Buyer nor its subsidiary have any material liability or obligation, absolute or contingent (individually or in the aggregate), except (i) obligations and liabilities incurred after the date of incorporation in the ordinary course of business that are not material, individually or in the aggregate, and (ii) obligations under contracts made in the ordinary course of business that would not be required to be reflected in financial statements prepared in accordance with generally accepted accounting principles.
 
5.12           Environmental Laws.  Buyer and its subsidiary are in compliance, and at all times have complied, with all Environmental Laws applicable to them and each of the properties currently owned, leased or operated by them and each of the properties formerly owned, leased or operated by them and with all of the Permits.  Buyer is not aware of any violation with respect to any of the Permits, which violations are outstanding or uncured as of the date hereof, and no proceeding is pending, or to Buyer’s knowledge, threatened, to revoke or limit any of the Permits.
 
Buyer has not performed or suffered any act which could give rise to, or has otherwise incurred, liability to any Person, including itself, under the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. § 9601 et seq. (“CERCLA”) or any of the Environmental Laws, nor does Buyer have notice of any such liability or any claim therefor or submitted notice pursuant to Section 103 of CERCLA to any Governmental Authority nor provided information in response to a request for information pursuant to Section 104(e) of CERCLA or any analogous state or local information gathering authority.
 
 
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5.13           Tax Returns; Taxes.  Buyer has conducted no business to date.  Buyer will file all federal, state and local Tax Returns and Tax reports required by such authorities to be filed through September 30, 2009 within 30 days of the Closing.  Buyer has paid all Taxes, assessments, governmental charges, penalties, interest and fines due or claimed to be due by any federal, state or local authority through September 30, 2009.  There is no pending Tax examination or audit of, nor any action, suit, investigation or claim asserted or, to Buyer’s knowledge, threatened against any Buyer by any federal, state or local authority; and Buyer has not been granted any extensio n of the limitation period applicable to any Tax claims.
 
5.14           Disclosure.                      Buyer has provided each Seller and DSS with all the information reasonably available to it without undue expense that each has requested for deciding whether to purchase the IMS Common Stock and all information that Buyer believes is reasonably necessary to enable such Seller and DSS to make such decision.  To the best of Buyer’s knowledge after reasonable investigation, neither this Agreement nor any other written statements or certificates made or delivered in connection herewith contains any untrue statement of a material fact or omits to stat e a material fact necessary to make the statements herein or therein not misleading.
 
Article VI.  Certain Covenants
 
6.1           Further Assurances.  From time to time after the Closing, the parties agree to cooperate and to execute and deliver such instruments of sale, transfer, conveyance, assignment and delivery, and such consents, assurances, powers of attorney and other instruments as may be reasonably requested by one or more of the other parties or its counsel in order to vest in Buyer all right, title and interest of Seller in and to the Acquired Assets and otherwise in order to carry out the purpose and intent of this Agreement.
 
6.2           Board of Directors.  Upon the Effective Date of this Agreement, Buyer’s Whole Board shall be expanded to five (5) directors.  Seller shall have the right to nominate for election two (2) of the five (5) directors.  Seller and DSS have informed Buyer that Seller’s and DSS’s nominees for the two director seats are Patrick White and Philip Jones.  At the Closing, Buyer, DSS and the IMS Stockholders shall enter into the Voting Agreement in the Form attached hereto as Exhibit E, in connection with the appointment of said nominees to the Buyer’s board of directors.  In the event any vacancy occurs in a seat designed for a nominee of Sel ler and DSS, Buyer and its Board of Directors shall take all actions necessary to appoint a successor designated by Seller and DSS to fill such vacancy.
 
6.3           Working Capital.  Within 180 days of the Effective Date, the Buyer shall raise cash net proceeds from a debt or equity financing of at least $200,000 (the “Initial Financing”).  Buyer shall use the proceeds from the Initial Financing for marketing, working capital and to pay the expenses for registering the shares of IMS Common Stock with the SEC.
 

 
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6.4           Registration of Shares.  As soon as practicable but not later than 180 days after the Closing Date, Buyer will file, on a best efforts basis, a Registration Statement on Form S-1 with the Securities and Exchange Commission (“SEC”) registering all the shares of IMS Common Stock issued to Seller and/or DSS under the Agreement (the “Registration Statement”) and within 360 days after the Closing Date shall have the Registration Statement covering at least twenty percent (20%) of such shares declared effective, as provided in the Registration Rights Agreement.
 
6.5           Certain Employee Matters.  Effective as of the Closing Date, Buyer may, but shall not be obligated to offer employment to all or some of Seller’s employees who are actively at work immediately prior to the Closing Date, subject to Buyer’s right to terminate the employment of any such employee(s) at any time and for any reason in its sole discretion.  It is specifically understood that (i) Buyer shall have no obligation to hire any of the Seller’s employees and (ii) no rights or entitlements shall vest in favor of any third party (including any of the Seller’s employees) by virtue of this Agreement.
 
6.6           Extension of Health and Dental Insurance.  If requested by Buyer, Seller agrees to continue health and dental insurance coverage, at Buyer’s sole expense, for a period of up to three (3) months, for certain employees of Seller that have been offered and accepted employment at Buyer’s company.
 
6.7           Non-Competition, Non-Disclosure and Non-Solicitation.  For a period commencing on the Closing Date and ending on the date that is two (2) years after the Closing Date (the “Restricted Period”), and provided that Buyer is not in default of the covenant in Section 6.4 (“Registration of Shares”) of this Agreement, Seller shall, and Seller shall ensure that none of its respective Affiliates shall, engage, directly or indirectly, in any business that markets and sells legal supplies, legal forms and legal documents in the United States (the “Restricted Area”).  For the purposes of this Section 6.7, Business shall not include the sale of “security paper” by the Seller via the Seller’s direct sales channels of via the Internet or other electronic means of communication.  Both Seller and Buyer may actively engage in the selling and marketing of “security paper” throughout the Restricted Period.  By way of further definition and explanation of the foregoing, and without limiting the generality of the foregoing restriction, during such Restricted Period, Seller and none of their respective Affiliates shall devote any time or attention to acquiring, managing, operating, joining, controlling, participating or becoming financially interested in, or being connected with (in any capacity, whether as a partner, stockholder, investor, consultant, independent contractor, agent, representative or otherwise), or providing any direct or indirect financial assistance to, any Person that is engaged, directly or indirectly, in any business that markets and sells legal supplies, legal forms and legal documents within the Restr icted Area.  Nothing contained herein, however, shall prohibit the Seller or any of their respective Affiliates from acquiring and owning the IMS Common Stock as contemplated by this Agreement, or from owning and acquiring, for investment purposes only, up to five percent (5%) of the outstanding equity securities of a Person engaged in an activity competitive with the Business if such equity securities of any such Person are available to the general public on a national securities exchange or the over-the-counter market.
 
Seller hereby acknowledges, covenants and agrees that, from and after the date hereof, it will hold any and all items constituting Business secrets communicated or transmitted to, or otherwise obtained by, it in strictest confidence.  Seller shall not, regardless of the reason therefore, directly or indirectly make use of, exploit, disclose or divulge any Business secrets to any other Person (except to the extent such information is required to be submitted to any Governmental Authority or to any other Person pursuant to subpoena or other court process or as may be permitted herein), or knowingly make any false statement or otherwise commit any act (including contacting any customers of the Business) that could in any way be injurious or detrimental to Buyer, the Business or to Buyer’s use of the Acquired Assets, includ ing, without limitation, Buyer’s image, business or customer relations.
 
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During the Restricted Period, Seller shall not, for its own benefit, or for the benefit of any other Person, or for any reason, accept any business with respect to the Business from, or interfere in any manner with the Buyer’s business relationship with, any customer of Buyer or the Business.  Without limiting the generality of the foregoing, Seller shall not solicit or induce, or attempt to solicit or induce, any business with respect to the Business (directly or indirectly through any Person) from any current customer of the Business.  Furthermore, nothing contained in this Agreement shall be construed to infer that Seller is, in any respect whatsoever, retaining any rights to, or in respect of, the customer list or the Business, or any customer information of the Business for direct or indirect use after th e expiration of the Restricted Period, it being understood and agreed that pursuant to this Agreement Buyer is acquiring all of the Seller’s rights thereto without limitation as to time or otherwise.

During the Restricted Period, Seller shall not shall hire, solicit or induce, or attempt to hire, solicit or induce (directly or indirectly through any Person), for employment, or interfere in any manner with Buyer’s relationship with, any employee, agent, consultant or other representative of Buyer or any of its Affiliates. Except that the Seller may provide reference letters to unemployed former employees.

The invalidity or unenforceability of this Article 6 in any respect shall not affect the validity or enforceability of this Article 6 in any other respect, or of any other provision of this Agreement.  In the event that any provision of this Article 6 shall be held invalid or unenforceable by a court of competent jurisdiction by reason of the geographic or business scope or the duration thereof or for any other reason, such invalidity or unenforceability shall attach only to the particular aspect of such provision found invalid or unenforceable as applied and shall not affect or render invalid or unenforceable any other provisions of this Article 6 or the enforcement of such provision in other circumstances, and, to the fullest extent permitted by law, this Article 6 shall be construed as if the geographic or business scope o r the duration of such provision or other basis on which such provision has been challenged had been more narrowly drafted so as not to be invalid or unenforceable.

Seller acknowledges and agrees that the agreements and covenants contained in this Article 6 are of a unique and valuable nature and may, if breached, result in irreparable damage to Buyer that may not be readily susceptible to monetary valuation; and, accordingly, in the event of the breach of any covenant or agreement contained in this Article 6, Buyer shall be entitled to seek and obtain injunctive or other equitable relief, in addition to any other remedies provided by law or equity, in furtherance of the enforcement thereof.  In no event shall the amount or value of any consideration paid or given by Buyer for the covenants and agreements contained in this Article 6, or otherwise in connection with this Agreement, be used to determine the scope or extent of damages suffered by Buyer in the event of a breach by Seller of such covenants and agreements.
 
 
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6.8           Corporate Existence; Reporting Status.
 
(a)           So long as Seller or DSS beneficially owns any IMS Common Stock, Buyer shall maintain its corporate existence and that of Legal Store.Com, Inc. in good standing;
 
(b)          Buyer shall register its class of common stock with the SEC under Section 12(b) or 12(g) of the Securities Exchange Act of 1934, as amended ("Exchange Act"), no later than eighteen months after the date hereof and file with the SEC in a timely manner all reports and other documents required of the Company under the Exchange Act so long as Seller or DSS beneficially owns any IMS Common Stock; and
 
(c)           Buyer shall have its class of common stock approved for quotation on the OTCBB or for listing on a national securities exchange no later than 360 days from the date hereof and to maintain such listing or quotation so long as Seller or DSS beneficially owns any IMS Common Stock;
 
6.9           Certain Negative Covenants; Misc.  Until the earlier to occur of (x) 2 years from the Effective Date and (y) the time that the Registration Statement is declared effective by the SEC, without the approval of two-thirds of Buyer’s Whole Board, which shall include during such time at least two directors designated by DSS.  The Buyer shall not, and shall not permit any of its subsidiaries to, directly or indirectly:
 
               (a)           Pay, declare or set apart for such payment, any dividend or other distribution (whether in cash, property or other securities) on shares of capital stock or directly or indirectly or through any subsidiary of Buyer make any other payment or distribution in respect of its capital stock;
 
(b)           Redeem, repay, repurchase or otherwise acquire (whether for cash or in exchange for property or other securities or otherwise) in any one transaction or series of related transactions any shares of capital stock of Buyer or its subsidiary or any warrants, rights or options to purchase or acquire any such shares;
 
(c)           Enter into, create, incur, assume, guarantee or suffer to exist any indebtedness for borrowed money of any kind, including but not limited to, a guarantee, on or with respect to any of its property or assets now owned or hereafter acquired or any interest therein or any income or profits therefrom;
 
 
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(d)            Except for the IMS Common Stock to be issued to Seller pursuant to the Agreement, neither Buyer nor any subsidiary shall issue shares of capital stock of the Buyer or  any securities of the Buyer or its subsidiaries which would entitle the holder thereof to acquire, directly or indirectly, at any time capital stock of the Buyer, including without limitation, any debt, preferred stock, rights, options, warrants or other instrument that is at any time convertible into or exercisable or exchangeable for, or otherwise entitles the holder thereof to receive,  capital stock of the Buyer;

(e)            Enter into, amend, modify or supplement any agreement, transaction, commitment, or arrangement with any of its or any subsidiary’s officers, directors, employees, persons who were officers or directors at any time during the previous two (2) years, stockholders who beneficially own ten percent (10%) or more of the IMS Common Stock, or Affiliates of any thereof, or with any individual related by blood, marriage, or adoption to any such individual or with any entity in which any such entity or individual owns a ten percent (10%) or more beneficial interest, except for customary employment arrangements and benefit programs and director compensation on reasonable terms;

(f)             Increase the size of Buyer’s Whole Board to more than five (5) directors;

(g)            Effect any sale, lease, assignment, transfer, exclusive license or other conveyance of all or substantially all of the assets of the Buyer or any of its subsidiaries or any domain name(s), including legalstore.com, acquired as part of this Agreement, or effect any consolidation or merger involving the Buyer or any of its subsidiaries, or effect any reclassification or other change of any stock or any recapitalization of the Buyer or any of its subsidiaries;
 
                                (h)             Effect any amendment of its Certificate of Incorporation or By-Laws;

(i)              Use any proceeds from the Initial Financing (i) to repay any of its corporate debt or other indebtedness, (ii) to redeem any of its Common Stock or other securities, (iii) to settle any outstanding litigation, or (iv) to repay any debt or obligation to any officer, director or manager of Buyer, including but not limited to Buyer’s president, chief executive officer, chief financial officer and chief operations officer, and any of their affiliates or family members;

(j)              Operate the Business out of any location other than the existing Rochester, New York facility; or

(k)             Enter into any agreement with respect to any of the foregoing.

 
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6.10  D&O Insurance.  Upon the effectiveness of the Registration Statement, the Buyer shall maintain a director’s and officer’s insurance policy in the amount of at least $1.0 million.

Seller acknowledges that Buyer would not have completed the transaction contemplated by this Agreement absent the covenants and agreements set forth in this Article 6.

Article VII.  Indemnification
 
7.1           Indemnification.
 
(a)            By Seller.  Seller shall indemnify and hold harmless Buyer, and its officers, directors, shareholders, employees, Affiliates and agents, at all times from and after the Closing Date, against and in respect of Losses arising from: (i) any breach of any of the representations or warranties made by Seller in this Agreement (without regard to any materiality qualification contained in any such representation or warranty); (ii) any breach of the covenants and agreements made by Seller in this Agreement or any exhibit hereto delivered by Seller in connection with the Closing; (iii) any Excluded Liabilities; and (iv) any Excluded Assets up to a maximum aggregate amount with respect  to all such claims under this Section 7.1(a), of Three Hundred Thousand Dollars ($300,000);
 
(b)           By Buyer.  Buyer shall indemnify and hold harmless Seller and their respective directors, officers, employees, Affiliates and agents at all times from and after the Closing Date against and in respect of Losses arising from or relating to: (i) any breach of any of the representations or warranties made by Buyer in this Agreement (without regard to any materiality qualification contained in any such representation or warranty); (ii) any breach of the covenants and agreements made by Buyer in this Agreement or any exhibit hereto delivered by Buyer in connection with the Closing; (iii) any Assumed Liabilities; and (iii) the ownership of the Acquired Assets and operation of the Busi ness after the Closing Date.
 
7.2           Indemnification Procedures – Third Party Claims.
 
                              (b)           The rights and obligations of a party claiming a right of indemnification hereunder (each, an “Indemnitee”) from a party to this Agreement (each, an “Indemnitor”) in any way relating to a third party claim shall be governed by the following provisions of this Section 7.2.
 
(i)           The Indemnitee shall give prompt written notice to the Indemnitor of the commencement of any claim, action suit or proceeding, or any threat thereof, or any state of facts which Indemnitee determines will give rise to a claim by the Indemnitee against the Indemnitor based on the indemnity agreements contained in this Agreement setting forth, in reasonable detail, the nature and basis of the claim and the amount thereof, to the extent known, and any other relevant information in the possession of the Indemnitee (a “Notice of Claim”).  The Notice of Claim shall be accompanied by any relevant documents in the possession of the Indemnitee relating to the claim (such as copies of any s ummons, complaint or pleading which may have been served and, or any written demand or document evidencing the same).  No failure to give a Notice of Claim shall affect, limit or reduce the indemnification obligations of an Indemnitor hereunder, except to the extent such failure actually prejudices such Indemnitor’s ability successfully to defend the claim, action, suit or proceeding giving rise to the indemnification claim.
 
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(ii)           In the event that an Indemnitee furnishes an Indemnitor with a Notice of Claim, then upon the written acknowledgment by the Indemnitor given to the Indemnitee within 30 days of receipt of the Notice of Claim, stating that the Indemnitor is undertaking and will prosecute the defense of the claim under such indemnity agreements and confirming that as between the Indemnitor and the Indemnitee, and that the claim covered by the Notice of Claim is subject to this Article VII (an “Indemnification Acknowledgment”), then the claim covered by the Notice of Claim may be defended by the Indemnitor, at the sole cost and expense of the Indemnitor; provided, however, that the Indemnitee is authoriz ed to file any motion, answer or other pleading that may be reasonably necessary or appropriate to protect its interests during such 30 day period.  However, in the event the Indemnitor does not furnish an Indemnification Acknowledgment to the Indemnitee or does not offer reasonable assurances to the Indemnitee as to Indemnitor’s financial capacity to satisfy any final judgment or settlement, the Indemnitee may, upon written notice to the Indemnitor, assume the defense (with legal counsel chosen by the Indemnitee) and dispose of the claim, at the sole cost and expense of the Indemnitor.  Notwithstanding receipt of an Indemnification Acknowledgment, the Indemnitee shall have the right to employ its own counsel in respect of any such claim, action, suit or proceeding, but the fees and expenses of such counsel shall be at the Indemnitee’s own cost and expense, unless (A) the employment of such counsel and the payment of such fees and expenses shall have been specifically authoriz ed by the Indemnitor in connection with the defense of such claim, action, suit or proceeding or (B) the Indemnitee shall have reasonably concluded based upon a written opinion of counsel that there may be specific defenses available to the Indemnitee which are different from or in addition to those available to the Indemnitor, in which case the costs and expenses incurred by the Indemnitee shall be borne by the Indemnitor.
 
(iii)           The Indemnitee or the Indemnitor, as the case may be, who is controlling the defense of the claim, action, suit or proceeding, shall keep the other fully informed of such claim, action, suit or proceeding at all stages thereof, whether or not such party is represented by counsel.  The parties hereto agree to render to each other such assistance as they may reasonably require of each other in order to ensure the proper and adequate defense of any such claim, action, suit or proceeding.  Subject to the Indemnitor furnishing the Indemnitee with an Indemnification Acknowledgment in accordance with Section 7.2(a)(ii), the Indemnitee shall cooperate with the Indemnitor and provide such assistance, at the sole cost and expense of the Indemnitor, as the Indemnitor may reasonably request in connection with the defense of any such claim, action, suit or proceeding, including, but not limited to, providing the Indemnitor with access to and use of all relevant corporate records and making available its officers and employees for depositions, pre-trial discovery and as witnesses at trial, if required.  In requesting any such cooperation, the Indemnitor shall have due regard for, and attempt to not be disruptive of, the business and day-to-day operations of the Indemnitee and shall follow the requests of the Indemnitee regarding any documents or instruments which the Indemnitee believes should be given confidential treatment.
 
(c)        The Indemnitor shall not make or enter into any settlement of any claim, action, suit or proceeding which Indemnitor has undertaken to defend, without the Indemnitee’s prior written consent (which consent shall not be unreasonably withheld or delayed)), unless there is no obligation, directly or indirectly, on the part of the Indemnitee to contribute to any portion of the payment for any of the Losses, the Indemnitee receives a general and unconditional release with respect to the claim (in form, substance and scope reasonably acceptable to the Indemnitee), there is no finding or admission of any violation of law by, or effect on any other claim that may be made against the Indemnitee and, in the reasonable judgment of the Indemnitee, the relief granted in connection therewith i s not likely to have a Material Adverse Effect on the Indemnitee or the Indemnitee’s reputation or prospects.
 
 
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(d)           Any claim for indemnification that may be made under more than one subsection under Section 7.1 may be made under the subsection that the claiming party may elect in its sole discretion, notwithstanding that such claim may be made under more than one subsection.
 
7.3           Indemnification Procedures – Other Claims, Indemnification Generally.
 
(e)           A claim for indemnification for any matter not relating to a third party claim under Section 7.2 may be asserted by giving reasonable notice directly by the Indemnitee to the Indemnitor.  The Indemnitee shall afford the Indemnitor access to all relevant corporate records and other information in its possession relating thereto.
 
(f)           If any party becomes obligated to indemnify another party with respect to any claim for indemnification hereunder and the amount of liability with respect thereto shall have been finally determined, the Indemnitor shall pay such amount to the Indemnitee in immediately available funds within ten days following written demand by the Indemnitee.
 
Article VIII.  Miscellaneous
 
8.1           Publicity.  No press release or other public announcement concerning this Agreement or the transactions contemplated hereby shall be made without advance approval thereof by Seller and Buyer, except as required by law.
 
8.2           Entire Agreement.  This Agreement and the schedules and exhibits delivered in connection herewith constitute the entire agreement of the parties with respect to the subject matter hereof, and supersedes all other agreements between the parties.  The representations, warranties, covenants and agreements set forth in this Agreement and in any schedules or exhibits delivered pursuant hereto constitute all the representations, warranties, covenants and agreements of the parties hereto and upon which the parties have relied, and except as specifically provided herein, no change, modification, amendment, addition or termination of this Agreement or any part thereof shall be valid unless in writing and signed by or on behalf of the party to be charged therewith.
 
 
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8.3           Notices.  Any and all notices or other communications or deliveries required or permitted to be given or made pursuant to any of the provisions of this Agreement shall be deemed to have been duly given or made for all purposes if (i) hand delivered, (ii) sent by a nationally recognized overnight courier for next business day delivery or (iii) sent by telephone facsimile transmission (with prompt oral confirmation of receipt) as follows:
 
 
If to Buyer:
 
 
Internet Media Services, Inc.
 
4553 Glencoe Ave, Suite 325
 
Marina del Rey, California 90292
 
Attention:  Raymond Meyers
 
Telecopy No.: (310) 482-6969
   
 
with a copy to:
   
 
Law Office of Gary A. Agron
 
5445 DTC Parkway, Suite 520
 
Greenwood Village, Colorado 80111
 
Attention:  Gary A. Agron
 
Telecopy No.:  (303) 770-7257
   
  If to Seller:
   
 
Lester Levin Inc.
 
c/o Document Security Systems, Inc.
 
28 East Main Street, Suite 1525
 
Rochester, New York 14614
 
Attention:  Patrick White, Chief Executive Officer
 
Telecopy No.:  (585) 325-2977
 
 
with a copy to:
   
 
Woods Oviatt Gilman LLP
 
700 Crossroads Building
 
Rochester, NY 14614
 
Attention: Gregory W. Gribben, Esq.
 
Telecopy No.:  (585) 987-2975

or at such other address as any party may specify by notice given to the other party in accordance with this Section 7.3.  The date of giving of any such notice shall be the date of hand delivery, the business day sent by telephone facsimile, and the day after delivery to the overnight courier service.
 
 
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8.4           Non-Assignable Assets.  Notwithstanding anything contained in this Agreement to the contrary, this Agreement shall not constitute an agreement to transfer, sublease or assign any Contract if any such attempted transfer, sublease or assignment without the consent of any third party would constitute a breach thereof or would in any way materially and adversely affect the rights of Buyer or the obligations of Seller thereunder following the Closing.  Seller shall use commercially reasonable efforts to obtain the consent of any third party or parties to such transfer, sublease or assignment in all cases in which such consent is required.
 
8.5           Waivers and Amendments.  This Agreement may be amended, superseded, canceled, renewed or extended and the terms hereof may be waived only by a written instrument signed by the parties or, in the case of a waiver, by the party waiving compliance.
 
               8.6           Survival.  The representations and warranties contained in Sections 4.1, 4.2, 4.4, 5.1, 5.2, 5.5 and 5.6 shall survive the Closing indefinitely. All of the other representations and warranties contained in Articles IV and V of this Agreement shall survive the Closing until eighteen months from the date hereof. Notwithstanding the foregoing if at the stated expiration of any representation and warranty there shall then be pending any indemnification claim by a Person made in accordance with the terms hereof, such Person shall continue to have the right to pursue indemnification as provided herein with respect to such claim notwithstanding such expiration. All covenants and agreements made in this Agreement shall survive the Closing indefinitely (subject to any temporal limitation expressly provided for in any such covenants and agreements).

8.7          Counterparts.  This Agreement may be executed by the parties hereto in separate counterparts, each of which when so executed and delivered shall be an original, but all such counterparts shall together constitute one and the same instrument.
 
                8.8          Governing Law; Severability.  This Agreement shall be governed by, and construed in accordance with the internal Laws of the State of New York, without reference to the choice of law or conflicts of law principles thereof.  The parties hereby irrevocably (a) submit themselves to the non-exclusive jurisdiction of the state and federal courts sitting in Monroe County, New York and (b) waive the right and hereby agree not to assert by way of motion, as a defense or otherwise in any action, suit or other legal proceeding brought in any such court, any claim that it, he or she is not subject to the jurisdi ction of such court, that such action, suit or proceeding is brought in an inconvenient forum or that the venue of such action, suit or proceeding is improper.  Each party irrevocably and unconditionally consents to the service of any process, pleadings, notices or other papers in a manner permitted by the notice provisions of Section 8.3.  EACH PARTY HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE ACTIONS OF SUCH PARTY IN THE NEGOTIATION, ADMINISTRATION, PERFORMANCE AND ENFORCEMENT HEREOF.
 
8.9            Assignment.  This Agreement shall be binding upon, and inure to the benefit of, the parties and their respective heirs, administrators, successors and permitted assigns.  Neither this Agreement nor any rights or obligations hereunder shall be assignable by either party; provided that Buyer may assign its rights under this Agreement, subject to the covenants in Article VI of this Agreement, (i) as security to any lender providing financing for the transactions contemplated hereby (and any replacement thereof) and (ii) following the Closing in connection with a sale of all or substantially all of the Business.
 
 
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8.10           Negotiated Agreement.  The parties hereby acknowledge that the terms and language of this Agreement were the result of negotiations among the parties and, as a result, there shall be no presumption that any ambiguities in this Agreement shall be resolved against any particular party.  Any controversy over construction of this Agreement shall be decided without regard to events of authorship or negotiation.
 
8.11           Expenses; Taxes.  Each of Buyer and Seller shall bear all of their own expenses in connection with the execution, delivery and performance of this Agreement and the transactions contemplated hereby, including without limitation all fees and expenses of its agents, representatives, counsel and accountants.  Any sales, transfer or similar taxes owing from the transfer of the Acquired Assets shall be paid by Buyer.
 
8.12           Third Party Beneficiary.  DSS shall be a third party beneficiary of the representations and warranties, covenants, and other agreements between Buyer and Seller contained herein.
 
8.13           Headings.  The headings contained in this Agreement have been inserted for convenience of reference only and shall in no way restrict or modify any of the terms or provisions hereof.
 
* * * * * * * *
 
 
 
 
 
 
 
 
 
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first set forth above.
 

 
BUYER:
   
 
INTERNET MEDIA SERVICES, INC.
   
   
 
By: /s/ Raymond Meyers
 
Raymond Meyers
 
Chief Executive Officer
   
   
 
SELLER:
   
 
LESTER LEVIN INC.
   
   
 
By: Patrick White
 
Patrick White
 
Chief Executive Officer






 
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Exhibit A

Copyrights and Trademarks


None.
 
 
 
 
 
 
 
 
 
 
-31-

 
Exhibit B

Form of Assignment of Domain Name

Attached.
 
 
 
 
 
 
 
 
 
 
 
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Domain Name Assignment Agreement

This Domain Name Assignment Agreement (the “DomainAgreement”) is effective this ___ day of October, 2009 by and between Lester Levin Inc., a New York corporation, Document Security Systems, Inc., a New York corporation, Patrick White, individually (collectively, the “Assignors”) and Internet Media Services, Inc., a Delaware corporation (“Assignee”). Capitalized terms used but not defined in this Domain Agreement shall have the meanings given to them in the Agreement (as defined below).

 WITNESSETH:
 
Whereas, the parties have entered into that certain Asset Purchase Agreement, dated as of October ___, 2009 (the “Agreement”);
 
Whereas, pursuant to the Agreement, Assignee desires to own Assignors’ entire rights, title, and interest in and to the domain names in Schedule A hereto (the “Domain Names”);
 
WHEREAS, Patrick White is an officer of Lester Levin Inc. and registered some of the Domain Names in his own name for the convenience and benefit of Lester Levin Inc.;
 
WHEREAS, Document Security Systems, Inc. is the sole-shareholder of Lester Levin Inc. and registered some of the Domain Names in its name for the convenience and benefit of Lester Levin Inc.
 
Now, Therefore, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged:

 
1.          Assignors, on behalf of themselves and their predecessors and successors in interest, hereby sells, assigns and transfers to Assignee all right, title and interest in and to the Domain Names.  Without limiting the foregoing, Assignors hereby assign and transfer to Assignee any and all rights that Assignors have or may have in the Domain Names, including, without limitation, all right, title, and interest in and to that part of the goodwill of Assignors’ business connected with and symbolized by such Domain Names.
 
2.           Promptly upon request, Assignors will take all steps necessary to effectuate that the Domain Names will be transferred to Assignee.  Assignee will provide to Assignors the name servers and IP addresses to which such Domain Names will be transferred.
 
3.           Assignors covenant that it will promptly provide to Assignee, upon such request of Assignee, all pertinent facts and documents relating to the Domain Names as may be known and reasonably accessible to Assignors and will testify as to the same in any opposition, litigation or any proceeding related thereto.  At Assignee’s expense, Assignors shall execute and deliver all documents requested by Assignee and shall take all reasonably necessary steps to give effect to and further the purposes of this Agreement.
 
**End of Domain Name Assignment Agreement – Signature Page Follows**
 
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IN WITNESS WHEREOF, the undersigned have caused their duly authorized representatives to execute this Domain Agreement effective as of the date shown above and in the capacities shown below.
 
This Domain Agreement may be executed in any number of counterparts, each of which shall be an original, but all of which together shall constitute one instrument.
 
 
ASSIGNORS:
   
 
LESTER LEVIN INC.
   
 
By: /s/ Patrick White
 
Patrick White
 
President
   
   
 
Document Security Systems, Inc.
   
 
By: /s/ Patrick White
 
Patrick White
 
President and Chief Executive Officer
   
 
/s/ Patrick White
 
Patrick White, Individually
   
 
ASSIGNEE:
   
 
Internet Media Services, Inc.
   
 
By: /s/ Raymond Meyers
 
Raymond Meyers
 
President and Chief Executive Officer
 
 
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Schedule A

DOMAIN NAMES


Lester Levin Go Daddy Account:

LegalStore.com
LegalStore.org
LegalStore.mobi
LegalStore.me
LegalStore.us

Lester Levin Register.com Account:

legalstore.biz
legalstore.info
legalstore.ws
legalstore.tv
 
 
 
 
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Exhibit C

 
Form Bill of Sale


Attached.








 
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Bill of Sale

Know All Men By These Presents that LESTER LEVIN Inc., a New York corporation (the “Seller”), for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, hereby sells, assigns, transfers, conveys and delivers to Internet Media Services, Inc., a Delaware corporation (the “Buyer”), all right, title and interest in, and good and valid title to, the Acquired Assets pursuant to the terms of that certain Asset Purchase Agreement dated as of October ____, 2009, as the same may be amended, by and between the Buyer and the Seller (the “Agreement”).  All capitalized terms used herein and not otherwise defined shall have the meanings ascribed to them in the Agreement.

The Seller represents and warrants to the Buyer that the Seller has full right, power and authority to convey and transfer the aforementioned property and to execute and deliver this Bill of Sale.

[End of Bill of Sale – Signature Page Follows]
 
 
 
 
 
 
 
 
 
 
 
 
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In Witness Whereof, the Seller has caused this Bill of Sale of be executed as of October ___, 2009.
 
 

 
 
lester levin inc,
 
 
a New York corporation
 
By: /s/ Patrick White
 
Name: Patrick White
 
Title: Chief Executive Officer



 
 
 
 
 
 
 
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Exhibit D

Form Registration Rights Agreement












 
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REGISTRATION RIGHTS AGREEMENT


THIS REGISTRATION RIGHTS AGREEMENT (“Agreement”) is entered into as of this ___ day of October, 2009, by and among Internet Media Services, Inc., a company organized under the laws of the State of Delaware (the “Company”), and Document Security Systems, Inc., a New York corporation (“DSS”) which is acquiring shares of the Company’s Common Stock pursuant to the Asset Purchase Agreement (as defined in paragraph 2).

Recital

In connection with the Asset Purchase Agreement (as defined below), the Company and DSS wish to enter into this Agreement in order to confer upon DSS rights to register under the Securities Act of 1933, as amended (the “Act”) the shares of the Company ‘s Common Stock issued pursuant to the Asset Purchase Agreement.

Capitalized terms used herein have the respective meanings ascribed thereto in the Purchase Agreement unless otherwise defined herein.

Agreement

NOW, THEREFORE, in consideration of the foregoing recitals and the mutual promises, covenants, and conditions set forth below, the Company and DSS hereby agree as follows:

1.
Registration Rights of Purchasers

The Company hereby grants to DSS the Registration Rights contained herein. The Company and DSS agree that the registration rights provided herein, and the Asset Purchase Agreement set forth the sole and entire agreement on such subject matter between the Company and DSS.

2.
Definitions

As used in this Agreement (including the recitals hereto):

(a)           The terms “register,” “registered” and “registration” refer to a registration effected by preparing and filing a registration statement in compliance with the Act, and the declaration or ordering of the effectiveness of such registration statement or such other procedure as may hereafter be required to permit the public offering of securities under the Act;

(b)           The term “Company” refers to Internet Media Services, Inc., a corporation organized under the laws of the State of Delaware, and to any successor of the Company;

(c)           The term “Asset Purchase Agreement” means that certain Asset Purchase Agreement dated of even date herewith between Lester Levin Inc., a New York corporation (“LLI”) and the Company, to which this Agreement is attached as Exhibit D by and between the Company and the signatories thereto, whereby the Company is selling Shares to DSS;
 
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(d)           The term “Registrable Securities” means (a) any and all of the shares of the Company’s Common Stock issued to DSS pursuant to the Asset Purchase Agreement (the “Shares”), (b) any Common Stock of the Company issued as a dividend or other distribution with respect to, or in exchange or in replacement of, the Shares; provided, however, that any Registrable Securities disposed of by any Holder or person pursuant to one or more registration statements under the Act (including a transaction pursuant to a registration statement under this Agreement), or pursuant to Rule 144 promulgated under the Act shall thereafter cease to be Registrable Securities hereunder;

(e)           The term “Holder” means any Purchaser of Registrable Securities under the Asset Purchase Agreement or any permitted transferee of Registrable Securities

(f)           The term “Common Stock means the Company’s common stock, par value $.001 per share.

(g)           The term "Registration Statement(s)" means a registration statement(s) of the Company under the Act.
 
3.
Registration

(a)           Registration Statement.

(i)  Promptly following the Closing but no later than one-hundred and eighty (180) days after the Closing Date, the Company shall prepare and file with the Securities and Exchange Commission (“SEC”) one Registration Statement on Form S-1 (or, such form of registration statement as is then available to effect a registration for resale of the Registrable Securities, subject to DSS’s consent) (the "Intial Registration Statement"), covering the resale of all the Registrable Securities and the dividend of all the Registrable Securities to DSS’s shareholders (the "Target Registration Amount").

(ii)  In the event that any Registration Statement filed hereunder shall (when combined with any previous Registration Statements that are current and effective) register a number of shares of Common Stock which less than the Target Registration Amount (a “Target Registration Shortfall”), then the unregistered portion of the Target Registration Amount (the “Target Registration Shortfall Amount”) shall be included in the next Additional Registration Statement (in accordance with Section 3(c) below).

(iii) Any Registration Statement also shall cover, to the extent allowable under the 1933 Act and the rules promulgated thereunder (including Rule 416), such indeterminate number of additional shares of Common Stock resulting from stock splits, stock dividends or similar transactions with respect to the Registrable Securities. Such Registration Statements shall not include any shares of Common Stock or other securities for the account of any other holder without the prior written consent of DSS. The Registration Statements (and each amendment or supplement thereto, and each request for acceleration of effectiveness thereof) shall be provided to DSS and its counsel at least five (5) business days prior to its filing or other submission.
 
 
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(b)           Expenses. The Company will pay all expenses associated with each registration, including filing and printing fees, the Company’s counsel and accounting fees and expenses, costs associated with clearing the Registrable Securities for sale under applicable state securities laws and listing fees, but excluding discounts, commissions, fees of underwriters, selling brokers, dealer managers or similar securities industry professionals with respect to the Registrable Securities being sold, transfer taxes, the fees and expenses of counsel to DSS and DSS’s other out-of-pocket expenses in connection with the registration.

(c)           Effectiveness.

(i) The Company shall use commercially reasonable efforts to have a Registration Statement covering the Target Registration Amount as soon as practicable.  Notwithstanding anything to the contrary herein, the Company shall have the Registration Statement declared effective with respect to at least twenty percent (20%) of the Registrable Securities as soon as practicable but no later than October 1, 2010.

(ii) In the event of a Target Registration Shortfall (the date of each of which is referred to as a “Registration Trigger Date”), the Company shall file a new Registration Statement (an “Additional Registration Statement”), so as to cover the remaining Registrable Securities as of the Registration Trigger Date.  The Company shall prepare and file each Additional Registration Statement as soon as practicable following any Registration Trigger Date, but not later than not later than the later of (i) the date that is sixty (60) days after the date substantially all (as such term is then interpreted by the SEC) of the Registrable Securities registered under the immediately preceding Registration Statement are sold and (ii) the date that is six (6) months following the date of effectiveness of the most recent ly effective Registration Statement or Additional Registration Statement filed hereunder. The Company shall use its commercially reasonable efforts to cause such new Registration Statement to become effective within ninety (90) days filing.

(iii)  Each Registration Statement shall remain effective so long as is necessary to permit DSS to distribute the Registrable Securities to its shareholders or otherwise without further registration.  The Company shall notify DSS by facsimile or e-mail as promptly as practicable, and in any event, within twenty-four (24) hours, after any Registration Statement is declared effective and shall simultaneously provide DSS with copies of any related Prospectus to be used in connection with the sale or other disposition of the securities covered thereby.

4.           Due Diligence Review; Information.

The Company shall make available, during normal business hours, for inspection and review by the Holders, advisors to and representatives of the Holders, all financial and other records, all SEC filings, and all other corporate documents and properties of the Company as may be reasonably necessary for the purpose of such review, and cause the Company’s officers, directors and employees, within a reasonable time period, to supply all such information reasonably requested by the Holders or any such representative, advisor or underwriter in connection with any Registration Statement (including, without limitation, in response to all questions and other inquiries reasonably made or submitted by any of them), prior to and from time to time after the filing and effectiveness of any Registration Statement for the sole purpose of enabling t he Holders and such representatives, advisors and underwriters and their respective accountants and attorneys to conduct initial and ongoing due diligence with respect to the Company and the accuracy of any Registration Statement.
 
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5.
Registration Procedures

In connection with the registration of shares of Registrable Securities, the Company will at its expense:

(a)           Prepare and file with the SEC any Registration Statements with respect to such Registrable Securities and use its best efforts to cause such Registration Statements to be declared and remain effective until the securities covered by such Registration Statement have been sold, and, as expeditiously as possible, prepare and file with the SEC such amendments to such Registration Statement and supplements to the prospectus contained therein as may be necessary to effect compliance with the Act and to keep such Registration Statement effective until the securities covered by it have been sold;

(b)           As expeditiously as possible, furnish to the Holders of Registrable Securities participating in such registration such reasonable number of copies of the Registration Statements, exhibits and amendments thereto, preliminary prospectus, final prospectus and such other documents as such underwriters and/or Holders of Registrable Securities may reasonably request in order to facilitate the public offering of such securities, but only while the Company is required under the provisions hereof to keep the Registration Statements effective.  The Company consents to the use of the prospectus or any amendment or supplement thereto by each of the selling Holders in connection with the offering and sale of the Registrable Securities covered by such prospectus or any supp lement thereto.

(c)           Use its best efforts to register or qualify the securities covered by such Registration Statements under such state securities or blue sky laws of such jurisdictions as such participating Holders may reasonably request within 30 days following the original filing of such Registration Statements and to do any and all other acts and things that may be reasonably necessary or desirable to enable the selling Holders to consummate the public sale or other disposition in such jurisdictions of the Registrable Securities owned by the selling Holder;

(d)           Notify the Holders participating in such registration, promptly after it shall receive notice thereof, of the time when such Registration Statement has become effective or a supplement to any prospectus forming a part of such Registration Statement has been filed;

(e)           Notify in writing such Holders promptly (i) of any comments by the SEC with respect to such Registration Statement or prospectus, or any request by the SEC for the amending or supplementing thereof or for additional information with respect thereto, (ii) of the issuance by the SEC of any stop order suspending the effectiveness of such Registration Statement or prospectus or any amendment or supplement thereto or the initiation of any proceedings for that purpose, (iii) of the receipt by the Company of any notification with respect to the suspension of the qualification of the Registrable Securities for sale in any jurisdiction or the initiation or threatening of any proceeding for such purpose.
 
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(f)           Prepare and file with the SEC promptly upon the request of any such Holders, any amendments or supplements to such Registration Statement or prospectus which, in the reasonable opinion of counsel for such Holders, is required under the Act or the rules and regulations thereunder in connection with the distribution of the Registrable Securities by such Holders;

(g)           Prepare and promptly file with the SEC, and promptly notify such Holders of the filing of such amendment or supplement to such Registration Statement or prospectus as may be necessary to correct any statements or omissions if, at the time when a prospectus relating to such securities is required to be delivered under the Act, any event has occurred as the result of which any such prospectus or any other prospectus as then in effect would include a misstatement of a material fact or omit to state any material fact necessary to make the statements therein, in light of the circumstances in which they were made, not misleading;

(h)           In case any of such Holders or any underwriter for any such Holders is required to deliver a prospectus at a time when the prospectus then in effect may no longer be used under the Act, prepare promptly upon request such amendment or amendments to such Registration Statement and such prospectus or prospectuses as may be necessary to permit compliance with the requirements of the Act;

(i)           Advise such Holders, promptly after it shall receive notice or obtain knowledge thereof, of the issuance of any stop order by the SEC suspending the effectiveness of such Registration Statement or any post-effective amendment thereto or the initiation or threatening of any proceeding for the purpose and promptly use its best efforts to prevent the issuance of any stop order or to obtain at the earliest practicable date its withdrawal if such stop order should be issued;

(j)           Not file any Registration Statement or any amendment or supplement to such Registration Statement or prospectus to which counsel for a majority in interest of such Holders has reasonably objected on the grounds that such amendment or supplement does not comply in all material respects with the requirements of the Act or the rules and regulations thereunder, after having furnished a copy thereof to such counsel at least five (5) business days prior to the filing thereof; provided, however, that the failure of counsel for such Holders to review or object to any amendment or supplement to such Registration Statement or prospectus shall not affect the rights of Holder-Underwriters under Section 7(a) hereof;

(k)           At the request of any such Holder and to each underwriter, if any, furnish on the effective date of the Registration Statement the letter specified in subparagraph (ii) below, and, on the effective date, or, if the registration includes an underwritten public offering, at such closing, (i) an opinion, dated such date, of the counsel representing the Company for the purposes of such registration, addressed to the Holder or Holders making such request, covering such matters with respect to any Registration Statement, the prospectus and each amendment or supplement thereto, proceedings under state and federal securities laws, other matters relating to the Company, the securities being registered and the offer and sale of such securities as are customarily the subject of th e opinions of issuer’s counsel provided to underwriters in underwritten public offerings, and (ii) a letter dated each such date, from the independent certified public accountants of the Company, addressed to the underwriters, if any, and to the Holder or Holders making such request, stating that they are independent certified public accountants within the meaning of the Act and that in the opinion of such accountants the financial statements and other financial data of the Company included in the Registration Statement or the prospectus or any amendment or supplement thereto comply in all material respects with the applicable accounting requirements of the Act, and additionally covering such other financial matters, including information as to the period ending not more than five (5) business days prior to the date of such letter with respect to such Registration Statement and prospectus, as the underwriters or such requesting Holder or Holders may reasonably request;
 
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(l)           Refrain from making any sale or distribution of its equity securities, for the sale of such securities, during the period commencing seven (7) days prior to, and expiring 90 days after, the date any registration statement becomes effective and to obtain from each officer, director, shareholder owning 5% or more of the Company’s outstanding equity securities a commitment substantially equivalent to that contained in this Section 5(l) hereof;

(m)          Otherwise use its best efforts to comply with all applicable rules and regulations of the SEC;

(n)           Provide a transfer agent and registrar (which may be the same entity) for the shares of the Company ‘s Common Stock;

(o)           Issue to any underwriter to which any Holder may sell shares in such offering certificates evidencing shares of the Company’s Common Stock; and

(p)           List the Registrable Securities being registered on any national securities exchange on which any shares of the Company’s Common Stock is listed or, if any shares of the Company’s common stock are not listed on a national securities exchange, qualify the Registrable Securities being registered for inclusion on the OTC Bulletin Board, or a successor quotation system.

(q)           Deliver promptly to each Holder participating in the offering copies of all correspondence between the SEC and the Company, its counsel or auditors and all memoranda relating to discussions with the SEC or its staff with respect to any Registration Statement and permit each Holder and underwriter to do such investigation, upon reasonable advance notice, with respect to information contained in or omitted from the Registration Statement as it deems reasonably necessary. Such investigation shall include access to books, and properties and opportunities to discuss the business of the Company with its officers and independent auditors.

6.
Delay of Registration

No Holder shall have any right to take any action to restrain, enjoin, or otherwise delay any such registration as the result of any controversy that might arise with respect to the interpretation or implementation of this Agreement.
 
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7.
Indemnification

In the event any Registrable Securities are included in a Registration Statement under this Agreement:

(a)           To the extent permitted by law, the Company will indemnify and hold harmless each Holder (and, if applicable, each officer, director and/or general partner of such Holder) of Registrable Securities with respect to which a Registration Statement has been filed under the Act pursuant to this Agreement, each underwriter of any of the Registrable Securities included in such Registration Statement, and each person, if any, who controls any such Holder or underwriter within the meaning of Section 15 of the Act or Section 20 of the Securities Exchange Act of 1934, as amended (the “Exchange Act “) (hereinafter collectively referred to as the “ Holder-Underwriters”), and to reimburse each such Holder-Underwriter, with respect to the following:

(i)           against any loss, liability (joint or several), claim, damage and expense arising out of any misstatement of a material fact or alleged misstatement of a material fact contained in such Registration Statement, including any preliminary prospectus or final prospectus contained therein or any amendments or supplements thereto, or the omission or alleged omission therefrom of a material fact required to be stated therein or necessary to make the statements therein not misleading in light of the circumstances in which they were made, unless such misstatement of a material fact or omission was made in reliance upon and in conformity with written information furnished to the Company by any Holder expressly for use in connection with such registration; or

(ii)           against any legal or other expenses reasonably incurred by the Holder-Underwriters in connection with investigating or defending any such loss, claim, damage, liability, or action provided, however, this Section 7(a) shall not apply to amounts paid in settlement of any such loss, claim, damage, liability, or action if such settlement is effected without the written consent of the Company (which consent shall not be unreasonably withheld).

In no case shall the Company be liable under this indemnity agreement with respect to any loss, liability, claim, damage or expense with respect to any claim made against any Holder-Underwriter unless the Company shall be notified in writing or otherwise becomes aware of the nature of the claim within a reasonable time after such Holder-Underwriter’s knowledge of the assertion thereof, but failure to so notify the Company shall not relieve the Company from any liability which it may have otherwise than on account of this indemnity agreement. In case of any such notice the Company shall be entitled to participate at its expense in the defense or, if it so elects within a reasonable time after receipt of such notice, to assume the defense of any suit brought to enforce any such claim; but if it so elects to assume the defense such de fense shall be conducted by counsel chosen by it and approved by the Holder-Underwriter or Holder-Underwriters and other defendant or defendants, if any, in any suit so brought, which approval shall not be unreasonably withheld. In the event that the Company elects to assume the defense of any suit and retain such counsel and such defense is diligently pursued the Holder-Underwriter or Holder-Underwriters and other defendant or defendants, if any, in the suit, shall bear the fees and expenses of any additional counsel thereafter retained by them other than for the reasonable cost of monitoring such defense; provided, however, that in the event of any conflict of interest between the Company and any Holder that requires the Holder to retain separate counsel, the Company shall bear the fees and expenses of such separate counsel.
 
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(b)           To the extent permitted by law, each Holder severally will indemnify and hold harmless the Company, each officer and director of the Company, each person, if any, who controls the Company within the meaning of Section 15 of the Act, each underwriter of Registrable Securities included in any Registration Statement which has been filed under the Act pursuant to this Agreement, each person, if any, who controls such underwriter within the meaning of Section 15 of the Act or Section 20 of the Exchange Act, each other Holder, and each person controlling such other Holder within the meaning of Section 15 of the Act or Section 20 of the Exchange Act against any loss, liability, claim, damage and expense described in subparagraphs (a)(i) through (a)(ii), inclusive, of this Sect ion 7, but only with respect to and to the extent such loss, liability, claim, damage or expense arises out of or is caused by a misstatement of a material fact or omission or alleged misstatement of a material fact or omission made in such Registration Statement, preliminary prospectus, final prospectus, or any amendment or supplement thereto in reliance upon and in conformity with written information furnished to the Company by such Holder expressly for use in connection with such registration; provided, however, that the obligations of each such Holder hereunder shall be limited to an amount equal to the net proceeds to such Holder of Registrable Securities sold as contemplated herein. In case any action shall be brought against the Company or any person so indemnified pursuant to the provisions of this subparagraph (b) and in respect of which indemnity may be sought against any Holder, the Holders from whom indemnity is sought shall have the rights and duties given to the Company, and the Company and the other persons so indemnified shall have the rights and duties given to the persons entitled to indemnification by the provisions of subparagraph (a) of this Section 7.

(c)           No indemnifying party in the defense of any such claim or litigation, shall, except with the consent of each indemnified party (which consent shall not be unreasonably withheld), consent to entry of any judgment or enter into any settlement that does not include as an unconditional term thereof the giving by the claimant or plaintiff to such indemnified party of a release from all liability in respect to such claim or litigation.

(d)           If for any reason the foregoing indemnity is unavailable, or is insufficient to hold harmless, an indemnified party, then the indemnifying party shall contribute to the amount paid or payable by the indemnified party as a result of such losses, claims, damages, liabilities or expenses (i) in such proportion as is appropriate to reflect the relative benefits received by the indemnifying party on the one hand and the indemnified party on the other or (ii) if the allocation provided by clause (i) above is not permitted by applicable law or provides a lesser sum to the indemnified party than the amount hereinafter calculated, in such pro-portion as is appropriate to reflect not only the relative benefits received by the indemnifying party on the one hand (taking into consid eration the fact that the provision of the registration rights hereinafter is a material inducement to the Holders to purchase the shares of Common Stock under the Asset Purchase Agreement) and the indemnified party on the other but also the relative fault of the indemnifying party and the indemnified party as well as any other relevant equitable considerations. Notwithstanding the foregoing, no Holder shall be required to pay, whether by indemnification or contribution, an aggregate amount in excess of the net proceeds received by such Holder in the Sale of Registrable Securities hereunder. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation.

8.
Information by Holder

The Holder or Holders of Registrable Securities included in any registration shall furnish to the Company such information regarding such Holder or Holders and the distribution proposed by such Holder or Holders as the Company may reasonably request in writing and as shall be required in connection with any registration, qualification or compliance referred to in this Agreement.
 
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9.
Rule 144 Reporting

With a view to making available to the Holders the benefits of Rule 144, as it may be amended from time to time, any future similar rules or regulations of the SEC which may permit the sale of the Registrable Securities to the public without registration or a simplified form of registration statement, the Company agrees to use its best efforts at all times to:

(a)           Make and keep public information available, as those terms are understood and defined in SEC Rule 144;

(b)           File with the SEC in a timely manner all reports and other documents required of the Company under the Exchange Act;

(c)           Furnish to each Holder, so long as it holds any Registrable Securities, forthwith upon its request (i) a written statement by the Company as to its compliance with the public information requirements of said Rule 144 and the reporting requirements of the Exchange Act, (ii) a copy of the most recent annual or quarterly report of the Company, and (iii) such other reports and documents as may be reasonably requested in availing any Holder of any rule or regulation of the SEC permitting the sale of any such securities without registration.

10.
Transfer of Registration Rights

The rights to cause the Company to register securities granted by the Company under this Agreement may be assigned by any holder of Registrable Securities to a transferee or assignee of Registrable Securities in a transaction other than a distribution to the public; provided that the Company is given written notice by such holder of Registrable Securities at the time of or within a reasonable time after said transfer, stating the name and address of said transferee or assignee and identifying the securities with respect to which such registration rights are being assigned.

11.
Entire Agreement

This Agreement, the Asset Purchase Agreement and the agreements entered into in connection therewith, constitutes the entire agreement among the parties as to the subject matter hereof. The terms and conditions of this Agreement shall inure to the benefit of and be binding upon the respective successors and assigns of the parties. Nothing in this Agreement, express or implied, is intended to confer upon any third party any rights, remedies, obligations, or liabilities under or by reason of this Agreement, except as expressly provided in this Agreement.
 
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12.
Governing Law

This Agreement shall be governed by and construed under the laws of the State of New York as those laws are applied by New York courts to agreements among New York State residents entered into and to be performed entirely within the State of New York.

13.
Counterparts

This Agreement may be executed 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.

14.
Title and Subtitles

The titles and subtitles used in this Agreement are used for convenience only and are not to be considered in construing or interpreting this Agreement.

15.
Notices

Any notice required or permitted under this Agreement shall be given in writing and shall be (i) hand delivered, (ii) sent by a nationally recognized overnight courier for next business day delivery or (iii) sent by telephone facsimile transmission (with prompt oral confirmation of receipt) as follows:
 
 
 
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If to Company:
 
 
Internet Media Services, Inc.
 
4553 Glencoe Ave, Suite 325
 
Marina del Rey, California 90292
 
Attention: Raymond Meyers
 
Telecopy No.: (310) 482-6969
   
 
with a copy to:
   
 
Law Office of Gary A. Agron
 
5445 DTC Parkway, Suite 520
 
Greenwood Village, Colorado 80111
 
Attention:  Gary A. Agron
 
Telecopy No.:  (303) 770-7257
   
 
If to DSS:
   
 
Document Security Systems, Inc.
 
28 East Main Street, Suite 1525
 
Rochester, New York 14614
 
Attention: Patrick White, Chief Executive Officer
 
Telecopy No.:  (585) 325-2977
   
 
with a copy to:
   
 
Woods Oviatt Gilman LLP
 
700 Crossroads Building
 
Rochester, NY 14614
 
Attention: Gregory W. Gribben, Esq.
 
Telecopy No.:  (585) 987-2800

or at such other address as such party may designate by five days’ advance written notice to the other party. The date of giving of any such notice shall be the date of hand delivery, the business day sent by telephone facsimile, and the day after delivery to the overnight courier service.
 
16.
Amendments and Waivers

This Agreement may be amended, and the observance of any term of this Agreement may be waived (either generally or in a particular instance and either retroactively or prospectively), with the written consent of (i) the Company and (ii) the Holders of at least 51% of the then outstanding Registrable Securities; provided that no such amendment or waiver of any term of this Agreement shall affect any outstanding Registrable Securities on a disproportionate basis without the specific written consent of each Holder affected thereby. Any amendment or waiver effected in accordance with this paragraph (including any agreement which fully restates the subject matter hereof and is intended to supersede the provisions of this Agreement in its entirety and render this Agreement of no further force or effect) shall be binding upon each holder of any securities subject to this Agreement at the time outstanding (including securities into which such securities are convertible), each future holder of all such securities, and the Company.

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

INTERNET MEDIA SERVICES, INC.

By: /s/ Raymond Meyers
Raymond Meyers
President

DOCUMENT SECURITY SYSTEMS, INC.

By: /s/ Patrick White
Patrick White
President
 
 
 
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Exhibit E

Form Voting Agreement























 
-52-

 
VOTING AGREEMENT
 

 
THIS VOTING AGREEMENT (the “Agreement”) is made and entered into as of this ____day of October, 2009, by and among Internet Media Services, Inc., a Delaware corporation (the “Company”), those holders of the Company’s Common Stock listed on Schedule A hereto (the “Key Holders”) and Document Security Systems, Inc., a New York corporation (the “Investor”).
 
R E C I T A L S
 
WHEREAS, the Key Holders are the beneficial owners of an aggregate of 13,000,000 shares of the common stock of the Company (the “Common Stock”);
 
WHEREAS, Investor is acquiring shares of the Company’s Common Stock pursuant to that certain Asset Purchase Agreement of even date herewith (the “Asset Purchase Agreement”) pursuant to which the Investor’s wholly-owned subsidiary, Lester Levin Inc., a New York corporation (“LLI”) is selling and transferring certain assets of its LegalStore.com business to the Company in exchange for the issuance to DSS of 7,500,000 shares of common stock of the Company (the “Transaction”);
 
WHEREAS, the obligations in the Asset Purchase Agreement are conditioned upon the execution and delivery of this Agreement; and
 
WHEREAS, in connection with the consummation of the Transaction, the Company, the Key Holders and the Investor have agreed to provide for the future voting of the Key Holders’ shares of the Company’s capital stock as set forth below.
 
NOW, THEREFORE, in consideration of the mutual promises and covenants set forth herein, the parties hereto further agree as follows:
 
1. Voting
 
1.1           Key Holder Shares; Investor Shares.   The Key Holders each agree to hold all shares of voting capital stock of the Company registered in their respective names or beneficially owned by them as of the date hereof and any and all other securities of the Company legally or beneficially acquired by each of the Key Holders after the date hereof (collectively, the “Key Holder Shares”) subject to, and to vote the Key Holder Shares in accordance with, the provisions of this Agreement; provided however that the Key Holder Shares may be pledged pursuant to those certain Stock Pledge and Security Agreements entered into of even date herewith, between each Key Holder, Investor and LLI.
 
1.2           Election of Directors. On all matters relating to the election of directors of the Company, the Key Holders agree to vote all Key Holder Shares held by them (or to consent pursuant to an action by written consent of the holders of capital stock of the Company) so as to elect two nominees designated by LLI and/or the Investor as members of the Company’s board of directors (the “Board of Directors”).  Any vote taken to remove any director elected pursuant to this Section 1.2, or to fill any vacancy created by the resignation, removal, or death of a director elected pursuant to this Section 1.2, shall also be subject to the provisions of this Section 1.2.
 
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1.3           No Liability for Election of Recommended Director. None of the parties hereto and no officer, director, stockholder, partner, employee or agent of any party makes any representation or warranty as to the fitness or competence of the nominee of any party hereunder to serve on the Board of Directors by virtue of such party’s execution of this Agreement or by the act of such party in voting for such nominee pursuant to this Agreement.
 
1.4           Legend.
 
(a)           Concurrently with the execution of this Agreement, there shall be placed on certificates representing the Key Holder Shares the following restrictive legend (the “Legend”):
 
“THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO THE TERMS AND CONDITIONS OF A VOTING AGREEMENT WHICH PLACES CERTAIN RESTRICTIONS ON THE VOTING OF THE SHARES REPRESENTED HEREBY. ANY PERSON ACCEPTING ANY INTEREST IN SUCH SHARES SHALL BE DEEMED TO AGREE TO AND SHALL BECOME BOUND BY ALL THE PROVISIONS OF SUCH AGREEMENT. A COPY OF SUCH VOTING AGREEMENT WILL BE FURNISHED TO THE RECORD HOLDER OF THIS CERTIFICATE WITHOUT CHARGE UPON WRITTEN REQUEST TO THE COMPANY AT ITS PRINCIPAL PLACE OF BUSINESS.”
 
(b)           The Company agrees that, during the term of this Agreement, it will maintain (upon registration of transfer, reissuance or otherwise) the Legend on any such certificate and will place or cause to be placed the Legend on any new certificate issued to represent Key Holder Shares previously represented by a certificate carrying the Legend.
 
1.5           Successors. The provisions of this Agreement shall be binding upon the successors in interest to any of the Key Holder Shares.  The Company shall not permit the transfer of any of the Key Holder Shares on its books or issue a new certificate representing any of the Key Holder Shares unless the person to whom such security is to be transferred shall have executed a written agreement, substantially in the form of this Agreement, pursuant to which such person becomes a party to this Agreement and agrees to be bound by all the provisions hereof as if such person were a Key Holder, as applicable; provided however that the Key Holder Shares may be pledged and transferred pursuant to those certain Stock Pledge and Security Agreements entered into of even date herewith, between each Key Holder, Investor, LLI and the Company (“Stock Pledge and Security Agreements”).
 
1.6           Other Rights. Except as provided by this Agreement, the Stock Pledge and Security Agreements or any other agreement entered into in connection with the Transaction, each Key Holder shall exercise the full rights of a holder of capital stock of the Company with respect to the Key Holder Shares, respectively.
 
 
 
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2.           Termination. This Agreement shall continue in full force and effect from the date hereof through the earliest of the following dates, on which date it shall terminate in its entirety:
 
(a)           the date on which Investor and LLI no longer own any Common Stock of the Company; and
 
(b)           two (2) years from the date of this Agreement;
 
3.           Miscellaneous.
 
3.1           Ownership. Each Key Holder represents and warrants to the Investor and the Company that (a) such Key Holder now owns the Key Holder Shares, free and clear of liens or encumbrances, and has not, prior to or on the date of this Agreement, executed or delivered any proxy or entered into any other voting agreement or similar arrangement other than one which has expired or terminated prior to the date hereof, and (b) such Key Holder has full power and capacity to execute, deliver and perform this Agreement, which has been duly executed and delivered by, and evidences the valid and binding obligation of, such Key Holder enforceable in accordance with its terms.
 
3.2           Further Action. If the Key Holder Shares are sold, the Key Holders or the personal representative of the Key Holders shall do all things and execute and deliver all documents and make all transfers, and cause any transferee of the Key Holder Shares to do all things and execute and deliver all documents, as may be necessary to consummate such sale consistent with this Agreement.
 
3.3           Specific Performance. The parties hereto hereby declare that it is impossible to measure in money the damages that will accrue to a party hereto or to a party’s heirs, personal representatives, or assigns by reason of a failure to perform any of the obligations under this Agreement and agree that the terms of this Agreement shall be specifically enforceable. If any party hereto or such party’s heirs, personal representatives, or assigns institutes any action or proceeding to specifically enforce the provisions hereof, any person against whom such action or proceeding is brought hereby waives the claim or defense therein that such party or such personal representative has an adequate remedy at l aw, and such person shall not offer in any such action or proceeding the claim or defense that such remedy at law exists.  The Key Holders hereby constitute and appoint the Chief Executive Officer and Chief Financial Officer of the Investor, and each of them, with full power of substitution, as the proxies of such party with respect to the matters set forth herein, and hereby authorizes each of them to vote on such matters, if and only if the party (i) fails to vote or (ii) attempts to vote (whether by proxy, in person or by written consent), in a manner inconsistent with the terms of this Agreement, all of such party’s Key Holder Shares in favor of the election of persons as members of the Board of Directors determined in accordance with this Agreement. Such proxy is given in consideration of the agreements of the parties hereto in connection with the transactions contemplated by this Agreement and accordingly is coupled with an interest and irrevocable until the termination of this Agreemen t. Each party hereto hereby revokes any previous proxy with respect to Key Holder Shares and shall not hereafter grant any other proxy or power of attorney with respect to any Key Holder Shares, deposit any Key Holder Shares into a voting trust or enter into any agreement, arrangement or understanding with any person to vote or grant any proxy with respect to any Key Holder Shares with respect to the matters set forth herein, expect as set forth in the Stock Pledge and Security Agreements.
 
 
 
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3.4           Governing Law. This Agreement shall be governed by and construed under the laws of the State of New York as such laws are applied to agreements among New York residents entered into and performed entirely within the State of New York. The parties agree that any action brought by any party under or in relation to this Agreement, including without limitation to interpret or enforce any provision of this Agreement, shall be brought in, and each party agrees to and does hereby submit to the jurisdiction and venue of, any state or federal court located in the County of Monroe, State of New York.
 
3.5           Amendment or Waiver. This Agreement may be amended or modified (or provisions of this Agreement waived) only upon the written consent of the parties hereto.
 
3.6           Severability. In the event one or more of the provisions of this Agreement should, for any reason, be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other provisions of this Agreement, and this Agreement shall be construed as if such invalid, illegal or unenforceable provision had never been contained herein.
 
3.7           Successors and Assigns. The provisions hereof shall inure to the benefit of, and be binding upon, the parties hereto and their respective successors, assigns, heirs, executors, administrators and other legal representatives.
 
3.8           Additional Shares. If after the date of this Agreement any shares or other securities are issued on, or in exchange for, any of the Key Holder Shares by reason of any stock dividend, stock split, combination of shares, reclassification, or the like, such shares or securities shall be deemed to be Key Holder Shares, as the case may be, for purposes of this Agreement.
 
3.9           Counterparts. This Agreement may be executed in one or more counterparts, each of which will be deemed an original, but all of which together shall constitute one instrument.
 
3.10           Waiver. No waivers of any breach of this Agreement extended by any party hereto to any other party shall be construed as a waiver of any rights or remedies of any other party hereto or with respect to any subsequent breach.
 
3.11           Delays or Omissions. No delay or omission to exercise any right, power or remedy accruing to any party, upon any breach, default or noncompliance by another party under this Agreement shall impair any such right, power or remedy, nor shall it be construed to be a waiver of any such breach, default or noncompliance, or any acquiescence therein, or of or in any similar breach, default or noncompliance thereafter occurring. Any waiver, permit, consent or approval of any kind or character on any party’s part of any breach, default or noncompliance under this Agreement or any waiver on such party’s part of any provisions or conditions of the Agreement must be in writing and shall be effective only to the extent specifically set forth in such writing. All remedies, either under this Agreement by law, or otherwise afforded to any party, shall be cumulative and not alternative.
 
 
 
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3.12           Attorney’s Fees. If any suit or action is instituted under or in relation to this Agreement, the prevailing party in such dispute shall be entitled to recover from the losing party all fees, costs and expenses of such suit or action (including any appeals), including without limitation, the reasonable fees and expenses of attorneys and accountants.
 
3.13           Notices. All notices required in connection with this Agreement shall be in writing and shall be deemed effectively given: (a) upon personal delivery to the party to be notified, (b) when sent by confirmed electronic mail or facsimile if sent during normal business hours of the recipient; if not, then on the next business day, (c), one (1) day after deposit with a nationally recognized overnight courier, specifying next day delivery, with written notification of receipt. All communications shall be sent to the parties at the address and facsimile number appearing on the signature page hereof or at such address as such party may designate by ten (10) days written notice to the other parties hereto.< /div>
 
3.14           Entire Agreement. This Agreement and the Exhibits hereto, along with the Asset Purchase Agreement and the other documents delivered pursuant thereto, constitute the full and entire understanding and agreement between the parties with regard to the subjects hereof and thereof and no party shall be liable or bound to any other in any manner by any oral or written representations, warranties, covenants or agreements except as specifically set forth herein and therein. Each party expressly represents and warrants that it is not relying on any oral or written representations, warranties, covenants or agreements outside of this Agreement.
 
[SIGNATURE PAGE FOLLOWS]
 
 
 
 
 
 
 
 
 
 
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VOTING AGREEMENT SIGNATURE PAGE
 
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above written.
 
COMPANY:
INTERNET MEDIA SERVICES, INC.
INVESTOR:
DOCUMENT SECURITY SYSTEMS, INC.
By:________________________________
Name:____________________________
Title: ______________________________
Address:___________________________
__________________________________
Fax:_______________________________
By:________________________________
Name: _____________________________
Title: ______________________________
Address:___________________________
__________________________________
Fax:_______________________________

 
KEY HOLDER:  Raymond Meyers
 
Address: ________________________________           
Fax: ________________________________      
 

 
KEY HOLDER:  Michael Buechler
 
Address:  ________________________________              
Fax:  ________________________________   
 
 
 
 
-58-

 
 
EXHIBIT A
 
LIST OF KEY HOLDERS
 

 
Raymond Meyers
 
Michael Buechler
 
 
 
 
 
 
 
 
 
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Exhibit F

Form Stock Pledge and Escrow Agreement
















 
-60-

 
STOCK PLEDGE AND ESCROW AGREEMENT
 
THIS AGREEMENT is made the __ day of October, 2009, between Lester Levin Inc., a New York corporation (“LLI”), Document Security Systems, Inc., a New York corporation (“DSS”) (hereinafter collectively referred to as “Obligees”) and Raymond Meyers (hereinafter referred to as “Pledgor”),  Internet Media Services, Inc., a Delaware corporation (the “Company”), and ______________________ (hereinafter referred to as “Escrow Agent”).
 
Recitals
 
WHEREAS, Pledgor is a controlling stockholder, President and director of the Company;
 
WHEREAS, LLI and the Company have entered into that certain Asset Purchase Agreement of even date herewith (the “Asset Purchase Agreement”) pursuant to which LLI is selling and transferring certain assets of its LegalStore.com business to the Company in exchange for the issuance to LLI’s parent corporation, DSS, 7,500,000 shares of common stock of the Company;
 
WHEREAS, pursuant to the covenants in the Asset Purchase Agreement, following the transaction, the Company is obligated to take certain measures to advance the business of the Company;
 
WHEREAS, Pledgor has agreed to secure the performance of the Company’s obligations to Obligees pursuant to such covenants in the Asset Purchase Agreement by executing this agreement and transferring to and registering in the name of the Escrow Agent the 9,000,000 shares of stock of the Company held by the undersigned.
 
NOW, THEREFORE, in consideration of the premises and understandings contained herein and for good and valuable consideration, receipt of which is hereby acknowledged, the parties agree as follows:
 
1.
Pledge Agreement
 
(a)           As collateral security for the performance of those certain covenants of the Company under the Asset Purchase Agreement set forth in Section 1(b) below, Pledgor hereby (i) grants to Obligees a security interest in and (ii) pledges to Obligees and (iii) transfers as security all of the following instruments and property (receipt of which is hereby acknowledged by Escrow Agent):
 
(i)           Nine million (9,000,000) shares of common stock of Company held by the Pledgor and all successor stock to said shares, replacement stock for said shares, substituted stock for said shares or additional shares of stock of Company issued or transferred as a dividend on or stock split of or otherwise received because of or in lieu of the ownership of said shares of common stock of Company during the term of this agreement, whether the same resulted from merger, consolidation, reorganization or otherwise (hereinafter sometimes referred to as “Shares”), all to be registered in the name of the Escrow Agent; and
 
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(ii)           Any and all other instruments or cash or, in kind, dividends or other property which anyone is or may hereafter become entitled to receive with respect to replacement of, substitution for, or succession to the aforesaid Shares.
 
All of the foregoing property and instruments shall be individually and collectively hereinafter referred to as “Collateral.” The Collateral shall be held by the Escrow Agent hereinafter named in accordance with the terms and pro-visions contained in this agreement.
 
Certificates registering the Shares should be registered in the name of the Escrow Agent.
 
Pledgor agrees to forthwith deliver to Escrow Agent any and all Collateral hereafter acquired by Pledgor along with stock powers duly endorsed in blank with respect to any stock certificate therefor.
 
(b)           The following events shall constitute an “Event of Default” under this agreement:  (i) The Company’s failure to comply with the following covenants in Article VI of the Asset Purchase Agreement:  Section 6.2 Board of Directors; Section 6.3 Working Capital; Section 6.4 Registration of Shares; Section 6.8 Corporate Existence; Reporting Status; Section 6.9 Certain Negative Covenants (the “Company’s Covenants”), which covenants are incorporated herein by reference; and (ii) a breach of the Company’s representations and warranties set forth in Section 5 of the Asset Purchase Agreement, which representations and warranties are incorporated herein by reference.
 
2.
Escrow Agent
 
The parties agree that the Escrow Agent shall be ____________________.  Pledgor shall deliver the Collateral described in Paragraph (1) herein, simultaneously with the execution hereof, to Escrow Agent who shall hold and maintain the Collateral pursuant to the terms hereof. The Escrow Agent's compensation, if any, shall be paid one-half by the Company and one-half by DSS.
 
3.
Voting and Dividend Rights
 
During the term of this agreement, and until such time, if any, that an Event of Default has occurred, Pledgor or his assigns shall have the right to vote the Shares now or hereafter pledged. In the event an Event of Default has occurred, (which Event of Default shall be proven by the execution of an affidavit by an DSS officer (the “Obligee Representative“) stating that Company is in default of one or more such obligations), then upon the Escrow Agent receiving both such affidavit and a proof of service that such affidavit was served upon Pledgor, DSS shall have the right (but not the obligation) to vote the Shares held pursuant to this escrow and exercise and receive all other rights and privileges, including dividends, which are associated with the ownership of such Shares.
 
Other than as set forth above, neither Obligees nor the Escrow Agent, nor their assignees or anyone else taking under them, shall exercise the rights of a holder of the Shares (or its successors) unless and until the Collateral is accepted by the Obligee Representative pursuant to Subparagraph 4(a) herein.
 
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4.
Default and Remedies
 
(a)           Whenever an Event of Default exists as set forth in Paragraph 3 due to the failure to comply with the Company's Covenants in Section 6.3 Working Capital, and Section 6.4 Registration of Shares of the Asset Purchase Agreement; and such Event of Default has not been cured on or before October 8, 2010 (the "Registration Deadline"), Obligee Representative, at its option, may (in addition to the rights provided for in Paragraph 3):
 
(i)           Accept such portion of the Collateral as is set forth in Schedule I attached hereto based on the Event of Default existing at Registration Deadline, by giving notice of such fact to Pledgor and the Escrow Agent, in which case the Escrow Agent shall forthwith deliver the Collateral to Obligee Representative, as agent for all the Obligees, and this escrow shall be terminated.
 
(ii)           Exercise any remedies of a secured party under the New York Uniform Commercial Code (the “UCC“). When such process is complete, the Escrow Agent shall distribute any remaining assets held by the Escrow Agent to the Pledgor and this escrow shall be terminated.  The Pledgor's and the Company shall assist in the issuance of new certificates representing the Collateral.
 
(b)           Notwithstanding anything to the contrary herein, certificates representing all Shares held as Collateral shall be delivered to the Obligees until the Obligees receive a balance certificate duly issued by the Company representing the number of Shares the Obligees are entitled to receive under this Section 4.

(c)           Nothing herein contained is intended, nor should it be construed, to preclude Obligees from pursuing any other remedy provided by law or otherwise as a means of enforcing their rights. The foregoing remedies are in addition to, and not in derogation of, any statutory, equitable, or common law remedy that the Obligees may have with respect to the Pledgor, the Company and the transactions contemplated by this Agreement.

5.
Satisfaction of Obligations
 
At such time as the Company has satisfied the Company Covenant set forth in the Asset Purchase Agreement, Section 6.4 Registration of Shares or at such time as the Obligee Representative has accepted the Collateral as set forth in Paragraph 4(a) above:
 
(a)           Obligees, Obligee Representative, or Pledgor shall promptly notify the Escrow Agent in writing of such claim or such alleged acceptance.
 
(b)           Upon such notification, the Escrow Agent shall notify Obligees of such claim or acceptance within three (3) business days of the receipt of the same.
 
(c)           If (i) Obligees have made such notification of satisfaction of the Company’s Covenants or acceptance, or (ii) Obligees either acknowledge the claim or alleged acceptance to be true or do not object in writing within thirty (30) days of receipt of notice of the same from the Escrow Agent, then this agreement shall terminate and the Escrow Agent shall release any and all Collateral pledged or otherwise secured hereunder from the lien or liens as provided in this agreement and Escrow Agent shall transfer to Pledgor all of such Collateral then held by Escrow Agent, subject to compliance with Section 4(b), including Obligees acknowledgments (if any) that the obligations have been fulfilled.
 
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(d)           If Obligees do object to the claim or the alleged acceptance within said thirty (30) day period, then the Escrow Agent shall submit the question of the validity of the claim or the alleged acceptance to arbitration to be held according to the rules of the American Arbitration Association, one arbitrator, in Rochester, New York.
 
6.
Sale or Transfer of Collateral
 
During the term of this agreement, neither Obligees nor Escrow Agent shall sell or attempt to sell, assign, release, encumber or otherwise transfer or dispose of any of the Collateral pledged hereunder, except as may be allowed by Paragraphs 4 or 5 herein.
 
7.
Duties and Powers Of Escrow Agent
 
(a)           The Escrow Agent shall have only such responsibility with respect to the Collateral held in escrow as is expressly provided for in this agreement. In the absence of gross negligence, bad faith or fraud with respect to the performance of its obligation hereunder, the Escrow Agent shall not incur liability to any other party hereto.  The Escrow Agent shall not incur liability because of any substantive insufficiency in the form or manner of the execution by Obligee Representative or Pledgor of any notice or other instrument required, permitted or contemplated by this agreement, nor as a result of relying on the validity of any such notice or written instrument signed by a party unless the Escrow Agent was consulted regarding the same.
 
(b)           The powers conferred on the Escrow Agent shall not impose any duty upon the Escrow Agent to exercise any such powers.  The Escrow Agent shall be accountable only for property that it actually receives as a result of the exercise of such powers, and it shall not be responsible to the Pledgor for any act or failure to act hereunder, except for its own gross negligence or willful misconduct.
 
(c)           The Escrow Agent's sole duty with respect to the custody, safekeeping and physical preservation of the collateral in its possession, under Section 9-207 of the UCC or otherwise, shall be to deal with it in the same manner as the Escrow Agent deals with similar property for its own account. The Escrow Agent shall not be liable for failure to demand, collect or realize upon all or any part of the Collateral or for any delay in doing so or shall be under any obligation to sell or otherwise dispose of any Collateral upon the request of the Pledgor or otherwise.
 
(d)           All authorizations and agencies herein contained with respect to the Collateral are irrevocable and powers coupled with an interest.
 
8.
Resignation of the Escrow Agent
 
The Escrow Agent may resign upon thirty (30) days written notice to the other parties. If a successor Escrow Agent shall not have been designated herein or appointed by Pledgor and Obligee Representative before the effective date of such resignation, the Escrow Agent may petition any state or federal court to appoint a successor.
 
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9.
Waivers
 
Any forbearance, failure or delay by any party in exercising any right, power, or remedy hereunder shall not be deemed to be a waiver of such right, power, or remedy and any single or partial exercise of any right, power, or remedy hereunder shall not preclude the further exercise thereof; and any right, power and remedy shall continue in force and effect until such right, power or remedy is specifically waived by an instrument in writing. No waiver of any of the provisions of this agreement shall be deemed or shall constitute a waiver of any other provision of this agreement, nor shall such waiver constitute a continuing waiver unless otherwise expressly provided.
 
10.
Benefits
 
This agreement shall inure to the benefit of the parties, their heirs, personal representatives and permitted assigns and shall be binding upon the parties and their respective heirs and personal representatives.
 
11.
Choice of Law
 
This agreement shall be governed by the laws of the State of New York, and unless otherwise defined or provided herein, all words in this agreement have the meanings given them in the UCC.
 
12.
Captions
 
The subject headings of the paragraphs of this agreement are included for purposes of convenience only and shall not affect the construction or interpretation of any of its provisions.
 
13.
Notices
 
Any notice under this agreement shall be in writing, and any written notice or other document shall be deemed to have been duly given:
 
(a)           On the date of personal service on the parties,
 
(b)           One day after being sent by professional or overnight courier or messenger service guaranteeing one day delivery, with receipt confirmed by the courier, or
 
(c)           On the date of transmission if sent by telegram, telex, telecopy, or other means of electronic transmission resulting in written copies, with receipt confirmed.
 
Any such notice shall be delivered or addressed to the parties at the addresses set forth below or at the most recent address specified by the addressee through written notice under this provision. Failure to conform to the requirement that mailings be done by registered or certified mail shall not defeat the effectiveness of notice actually received by the addressee.
 
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14.
Entire Agreement; Amendments
 
(a)           This Agreement and the Schedule hereto, along with the Asset Purchase Agreement and the other documents delivered pursuant thereto, constitute the full and entire understanding and agreement between the parties with regard to the subjects hereof and thereof and no party shall be liable or bound to any other in any manner by any oral or written representations, warranties, covenants or agreements except as specifically set forth herein and therein. Each party expressly represents and warrants that it is not relying on any oral or written representations, warranties, covenants or agreements outside of this Agreement.
 
(b)           The provisions of this agreement may be modified at any time by written agreement of the parties. Any such agreement made after the date of this agreement shall be ineffective to modify this agreement in any respect unless in writing and signed by each of the parties hereto.
 
15.
Counterparts
 
This agreement may be executed in two or more counterparts, each of which shall be deemed an original but all of which shall constitute one and the same instrument and agreement.
 
16.
Severability
 
Each separately numbered paragraph of this agreement shall be treated as severable, to the end that if any one or more such paragraphs shall be adjudged or declared illegal, invalid or unenforceable, this agreement shall be interpreted and shall remain in full force and effect, as though such paragraph or paragraphs had never been contained in this agreement.
 
[SIGNATURE PAGE FOLLOWS]
 
 
 
 
 
 
 
 
-66-

 
 
IN WITNESS WHEREOF, the parties have executed this agreement on the date first above written.
 
PLEDGOR
COMPANY
   
RAYMOND MEYERS
INTERNET MEDIA SERVICES, INC.
   
Signature: /s/ Raymond Meyers
Signature:___________________________
Address: _________________________
By:_____________________________
_________________________________
Title:____________________________
_________________________________
Address:__________________________
 
_________________________________
OBLIGEES
_________________________________
   
DOCUMENT SECURITY SYSTEMS, INC.
 
   
Signature:_________________________
 
By:_________________________
 
Title:_________________________
 
Address:_________________________
 
   
   
LESTER LEVIN INC.
 
   
Signature:_________________________
 
By:_________________________
 
Title:_________________________
 
Address:_________________________
 
   
   
AGREED AND ACCEPTED:
 
   
ESCROW AGENT
 
   
Name:_________________________
 
By:_________________________
 
Title:_________________________
 
Address:_________________________
 

Escrow Agent, who acknowledges receipt of the property set forth in Paragraph 1(a) above.
 
-67-

 
 
Schedule I
To Stock Pledge And Escrow Agreement
 



Event of Default Existing at Registration Deadline
Number of Shares which Obligees May Accept on Event of Default pursuant to Section
 
Section 6.3 - Working Capital; and
Section 6.4 - Registration of Shares
8,600,000 shares of Company's Common Stock
Section 6.4 - Registration of Shares
3,250,000 shares of Company's Common Stock
   
   




 
 
 
 
-68-

 
 
STOCK PLEDGE AND ESCROW AGREEMENT
 
THIS AGREEMENT is made the __ day of October, 2009, between Lester Levin Inc., a New York corporation (“LLI”), Document Security Systems, Inc., a New York corporation (“DSS”) (hereinafter collectively referred to as “Obligees”) and Michael Buechler (hereinafter referred to as “Pledgor”),  Internet Media Services, Inc., a Delaware corporation (the “Company”), and ______________________ (hereinafte r referred to as “Escrow Agent”).
 
Recitals
 
WHEREAS, Pledgor is a controlling stockholder, President and director of the Company;
 
WHEREAS, LLI and the Company have entered into that certain Asset Purchase Agreement of even date herewith (the “Asset Purchase Agreement”) pursuant to which LLI is selling and transferring certain assets of its LegalStore.com business to the Company in exchange for the issuance to LLI’s parent corporation, DSS, 7,500,000 shares of common stock of the Company;
 
WHEREAS, pursuant to the covenants in the Asset Purchase Agreement, following the transaction, the Company is obligated to take certain measures to advance the business of the Company;
 
WHEREAS, Pledgor has agreed to secure the performance of the Company’s obligations to Obligees pursuant to such covenants in the Asset Purchase Agreement by executing this agreement and transferring to and registering in the name of the Escrow Agent the 4,000,000 shares of stock of the Company held by the undersigned.
 
NOW, THEREFORE, in consideration of the premises and understandings contained herein and for good and valuable consideration, receipt of which is hereby acknowledged, the parties agree as follows:
 
1.
Pledge Agreement
 
(a)           As collateral security for the performance of those certain covenants of the Company under the Asset Purchase Agreement set forth in Section 1(b) below, Pledgor hereby (i) grants to Obligees a security interest in and (ii) pledges to Obligees and (iii) transfers as security all of the following instruments and property (receipt of which is hereby acknowledged by Escrow Agent):
 
(i)           Four million (4,000,000) shares of common stock of Company held by the Pledgor and all successor stock to said shares, replacement stock for said shares, substituted stock for said shares or additional shares of stock of Company issued or transferred as a dividend on or stock split of or otherwise received because of or in lieu of the ownership of said shares of common stock of Company during the term of this agreement, whether the same resulted from merger, consolidation, reorganization or otherwise (hereinafter sometimes referred to as “Shares”), all to be registered in the name of the Escrow Agent; and
 
-69-

 
 
(ii)           Any and all other instruments or cash or, in kind, dividends or other property which anyone is or may hereafter become entitled to receive with respect to replacement of, substitution for, or succession to the aforesaid Shares.
 
All of the foregoing property and instruments shall be individually and collectively hereinafter referred to as “Collateral.” The Collateral shall be held by the Escrow Agent hereinafter named in accordance with the terms and pro-visions contained in this agreement.
 
Certificates registering the Shares should be registered in the name of the Escrow Agent.
 
Pledgor agrees to forthwith deliver to Escrow Agent any and all Collateral hereafter acquired by Pledgor along with stock powers duly endorsed in blank with respect to any stock certificate therefor.
 
(b)           The following events shall constitute an “Event of Default” under this agreement:  (i) The Company’s failure to comply with the following covenants in Article VI of the Asset Purchase Agreement:  Section 6.2 Board of Directors; Section 6.3 Working Capital; Section 6.4 Registration of Shares; Section 6.8 Corporate Existence; Reporting Status; Section 6.9 Certain Negative Covenants (the “Company’s Covenants”), which covenants are incorporated herein by reference; and (ii) a breach of the Company’s representations and warranties set forth in Section 5 of the Asset Purchase Agreement, which representations and warranties are incorporated herein by reference.
 
2.
Escrow Agent
 
The parties agree that the Escrow Agent shall be ____________________.  Pledgor shall deliver the Collateral described in Paragraph (1) herein, simultaneously with the execution hereof, to Escrow Agent who shall hold and maintain the Collateral pursuant to the terms hereof. The Escrow Agent's compensation, if any, shall be paid one-half by the Company and one-half by DSS.
 
3.
Voting and Dividend Rights
 
During the term of this agreement, and until such time, if any, that an Event of Default has occurred, Pledgor or his assigns shall have the right to vote the Shares now or hereafter pledged. In the event an Event of Default has occurred, (which Event of Default shall be proven by the execution of an affidavit by an DSS officer (the “Obligee Representative“) stating that Company is in default of one or more such obligations), then upon the Escrow Agent receiving both such affidavit and a proof of service that such affidavit was served upon Pledgor, DSS shall have the right (but not the obligation) to vote the Shares held pursuant to this escrow and exercise and receive all other rights and privileges, including dividends, which are associated with the ownership of such Shares.
 
Other than as set forth above, neither Obligees nor the Escrow Agent, nor their assignees or anyone else taking under them, shall exercise the rights of a holder of the Shares (or its successors) unless and until the Collateral is accepted by the Obligee Representative pursuant to Subparagraph 4(a) herein.
 
-70-

 
 
 
4.
Default and Remedies
 
(a)           Whenever an Event of Default exists as set forth in Paragraph 3 due to the failure to comply with the Company's Covenants in Section 6.3 Working Capital, and Section 6.4 Registration of Shares of the Asset Purchase Agreement; and such Event of Default has not been cured on or before October 8, 2010 (the "Registration Deadline"), Obligee Representative, at its option, may (in addition to the rights provided for in Paragraph 3):
 
(i)           Accept such portion of the Collateral as is set forth in Schedule I attached hereto based on the Event of Default existing at Registration Deadline, by giving notice of such fact to Pledgor and the Escrow Agent, in which case the Escrow Agent shall forthwith deliver the Collateral to Obligee Representative, as agent for all the Obligees, and this escrow shall be terminated.
 
(ii)           Exercise any remedies of a secured party under the New York Uniform Commercial Code (the “UCC“). When such process is complete, the Escrow Agent shall distribute any remaining assets held by the Escrow Agent to the Pledgor and this escrow shall be terminated.  The Pledgor's and the Company shall assist in the issuance of new certificates representing the Collateral.
 
(b)           Notwithstanding anything to the contrary herein, certificates representing all Shares held as Collateral shall be delivered to the Obligees until the Obligees receive a balance certificate duly issued by the Company representing the number of Shares the Obligees are entitled to receive under this Section 4.

(c)           Nothing herein contained is intended, nor should it be construed, to preclude Obligees from pursuing any other remedy provided by law or otherwise as a means of enforcing their rights. The foregoing remedies are in addition to, and not in derogation of, any statutory, equitable, or common law remedy that the Obligees may have with respect to the Pledgor, the Company and the transactions contemplated by this Agreement.

5.
Satisfaction of Obligations
 
At such time as the Company has satisfied the Company Covenant set forth in the Asset Purchase Agreement, Section 6.4 Registration of Shares or at such time as the Obligee Representative has accepted the Collateral as set forth in Paragraph 4(a) above:
 
(a)           Obligees, Obligee Representative, or Pledgor shall promptly notify the Escrow Agent in writing of such claim or such alleged acceptance.
 
(b)           Upon such notification, the Escrow Agent shall notify Obligees of such claim or acceptance within three (3) business days of the receipt of the same.
 
(c)           If (i) Obligees have made such notification of satisfaction of the Company’s Covenants or acceptance, or (ii) Obligees either acknowledge the claim or alleged acceptance to be true or do not object in writing within thirty (30) days of receipt of notice of the same from the Escrow Agent, then this agreement shall terminate and the Escrow Agent shall release any and all Collateral pledged or otherwise secured hereunder from the lien or liens as provided in this agreement and Escrow Agent shall transfer to Pledgor all of such Collateral then held by Escrow Agent, subject to compliance with Section 4(b), including Obligees acknowledgments (if any) that the obligations have been fulfilled.
 
-71-

 
 
(d)           If Obligees do object to the claim or the alleged acceptance within said thirty (30) day period, then the Escrow Agent shall submit the question of the validity of the claim or the alleged acceptance to arbitration to be held according to the rules of the American Arbitration Association, one arbitrator, in Rochester, New York.
 
6.
Sale or Transfer of Collateral
 
During the term of this agreement, neither Obligees nor Escrow Agent shall sell or attempt to sell, assign, release, encumber or otherwise transfer or dispose of any of the Collateral pledged hereunder, except as may be allowed by Paragraphs 4 or 5 herein.
 
7.
Duties and Powers Of Escrow Agent
 
(a)           The Escrow Agent shall have only such responsibility with respect to the Collateral held in escrow as is expressly provided for in this agreement. In the absence of gross negligence, bad faith or fraud with respect to the performance of its obligation hereunder, the Escrow Agent shall not incur liability to any other party hereto.  The Escrow Agent shall not incur liability because of any substantive insufficiency in the form or manner of the execution by Obligee Representative or Pledgor of any notice or other instrument required, permitted or contemplated by this agreement, nor as a result of relying on the validity of any such notice or written instrument signed by a party unless the Escrow Agent was consulted regarding the same.
 
(b)           The powers conferred on the Escrow Agent shall not impose any duty upon the Escrow Agent to exercise any such powers.  The Escrow Agent shall be accountable only for property that it actually receives as a result of the exercise of such powers, and it shall not be responsible to the Pledgor for any act or failure to act hereunder, except for its own gross negligence or willful misconduct.
 
(c)           The Escrow Agent's sole duty with respect to the custody, safekeeping and physical preservation of the collateral in its possession, under Section 9-207 of the UCC or otherwise, shall be to deal with it in the same manner as the Escrow Agent deals with similar property for its own account. The Escrow Agent shall not be liable for failure to demand, collect or realize upon all or any part of the Collateral or for any delay in doing so or shall be under any obligation to sell or otherwise dispose of any Collateral upon the request of the Pledgor or otherwise.
 
(d)           All authorizations and agencies herein contained with respect to the Collateral are irrevocable and powers coupled with an interest.
 
8.
Resignation of the Escrow Agent
 
The Escrow Agent may resign upon thirty (30) days written notice to the other parties. If a successor Escrow Agent shall not have been designated herein or appointed by Pledgor and Obligee Representative before the effective date of such resignation, the Escrow Agent may petition any state or federal court to appoint a successor.
 
-72-

 
 
9.
Waivers
 
Any forbearance, failure or delay by any party in exercising any right, power, or remedy hereunder shall not be deemed to be a waiver of such right, power, or remedy and any single or partial exercise of any right, power, or remedy hereunder shall not preclude the further exercise thereof; and any right, power and remedy shall continue in force and effect until such right, power or remedy is specifically waived by an instrument in writing. No waiver of any of the provisions of this agreement shall be deemed or shall constitute a waiver of any other provision of this agreement, nor shall such waiver constitute a continuing waiver unless otherwise expressly provided.
 
10.
Benefits
 
This agreement shall inure to the benefit of the parties, their heirs, personal representatives and permitted assigns and shall be binding upon the parties and their respective heirs and personal representatives.
 
11.
Choice of Law
 
This agreement shall be governed by the laws of the State of New York, and unless otherwise defined or provided herein, all words in this agreement have the meanings given them in the UCC.
 
12.
Captions
 
The subject headings of the paragraphs of this agreement are included for purposes of convenience only and shall not affect the construction or interpretation of any of its provisions.
 
13.
Notices
 
Any notice under this agreement shall be in writing, and any written notice or other document shall be deemed to have been duly given:
 
(a)           On the date of personal service on the parties,
 
(b)           One day after being sent by professional or overnight courier or messenger service guaranteeing one day delivery, with receipt confirmed by the courier, or
 
(c)           On the date of transmission if sent by telegram, telex, telecopy, or other means of electronic transmission resulting in written copies, with receipt confirmed.
 
Any such notice shall be delivered or addressed to the parties at the addresses set forth below or at the most recent address specified by the addressee through written notice under this provision. Failure to conform to the requirement that mailings be done by registered or certified mail shall not defeat the effectiveness of notice actually received by the addressee.
 
-73-

 
 
14.
Entire Agreement; Amendments
 
(a)           This Agreement and the Schedule hereto, along with the Asset Purchase Agreement and the other documents delivered pursuant thereto, constitute the full and entire understanding and agreement between the parties with regard to the subjects hereof and thereof and no party shall be liable or bound to any other in any manner by any oral or written representations, warranties, covenants or agreements except as specifically set forth herein and therein. Each party expressly represents and warrants that it is not relying on any oral or written representations, warranties, covenants or agreements outside of this Agreement.
 
(b)           The provisions of this agreement may be modified at any time by written agreement of the parties. Any such agreement made after the date of this agreement shall be ineffective to modify this agreement in any respect unless in writing and signed by each of the parties hereto.
 
15.
Counterparts
 
This agreement may be executed in two or more counterparts, each of which shall be deemed an original but all of which shall constitute one and the same instrument and agreement.
 
16.
Severability
 
Each separately numbered paragraph of this agreement shall be treated as severable, to the end that if any one or more such paragraphs shall be adjudged or declared illegal, invalid or unenforceable, this agreement shall be interpreted and shall remain in full force and effect, as though such paragraph or paragraphs had never been contained in this agreement.
 
[SIGNATURE PAGE FOLLOWS]
 
 
 
 
 
 
 
 
 
 
 
-74-

 
 
IN WITNESS WHEREOF, the parties have executed this agreement on the date first above written.
 
PLEDGOR
COMPANY
   
MICHAEL BUECHLER
INTERNET MEDIA SERVICES, INC.
   
Signature: /s/ Michael Buechler
Signature:___________________________
Address: _________________________
By:_____________________________
_________________________________
Title:____________________________
_________________________________
Address:__________________________
 
_________________________________
OBLIGEES
_________________________________
   
DOCUMENT SECURITY SYSTEMS, INC.
 
   
Signature:_________________________
 
By:_________________________
 
Title:_________________________
 
Address:_________________________
 
   
   
   
LESTER LEVIN INC.
 
   
Signature:_________________________
 
By:_________________________
 
Title:_________________________
 
Address:_________________________
 
   
   
   
AGREED AND ACCEPTED:
 
   
ESCROW AGENT
 
   
Name:_________________________
 
By:_________________________
 
Title:_________________________
 
Address:_________________________
 
   

Escrow Agent, who acknowledges receipt of the property set forth in Paragraph 1(a) above.
 
-75-

 
 
Schedule I
To Stock Pledge And Escrow Agreement
 



Event of Default Existing at Registration Deadline
Number of Shares which Obligees May Accept on Event of Default pursuant to Section
 
Section 6.3 - Working Capital; and
Section 6.4 - Registration of Shares
3,900,000 shares of Company's Common Stock
Section 6.4 - Registration of Shares
2,000,000 shares of Company's Common Stock
   
   


 
 
 
 

 
 
 
 
-76-

 
 

 
 

 
Exhibit G

Form Lock-Up Agreement















 
-77-

 
Internet Media Services, Inc.
4553 Glencoe Avenue, Suite 325
Marina del Rey, CA 90292


October ____, 2009

 
To: Holders of Internet Media Services, Inc. Common Stock

Re:    Lock-Up Agreement

 
Gentlemen:
 
Internet Media Services, Inc. (“IMS” or the “Company”) has entered into an Asset Purchase Agreement with Lester Levin Inc. (“Seller”), a New York corporation, dated October 8, 2009, whereby IMS will purchase certain assets of Seller relating to Seller’s business known as LegalStore.Com (the “Agreement”) in exchange for the issuance of 7,500,000 shares of its Common Stock, par value $.001 per share (the “Common Stock”) to Document Security Systems, Inc. (“DSS”), the sole-shareholder of Seller.

In accordance with the terms of the Agreement, as soon as practicable but not later than 180 days of closing, IMS will file a Registration Statement on Form S-1 with the Securities and Exchange Commission (“SEC”) registering all the shares of IMS Common Stock issued to Seller and/or DSS under the Agreement (“the Registration Statement”) and within 360 days of closing shall have the Registration Statement covering such shares declared effective, as provided in that certain Registration Rights Agreement between IMS and DSS, dated October ___, 2009 (the “Registration Rights Agreement”).

You are collectively the holders ( the “Holders”) of 13,000,000 shares of Common Stock of the Company.

In order for DSS to realize full and adequate consideration under the Agreement, and as a condition precedent to the Agreement, it is essential that the Company’s Holders agree not to sell or otherwise dispose of their Common Stock in the Company for the agreed upon period stated herein.

By signing and returning this agreement in the manner indicated below, the undersigned, Raymond Meyers and Michael Buechler, hereby agree not to, directly or indirectly, publicly sell, contract to sell or otherwise transfer any of the IMS Common Stock beneficially owned by them,  for a period of the earlier of (i) two (2) years from the date hereof, or (ii) one (1) year from the effective date of the Registration Statement (the “Lock-Up Period”).

If IMS engages an underwriter or placement agent during the Lock-Up Period, or otherwise attempts to raise additional capital through the sale of IMS Common Stock and/or other equity securities of the Company, in a public offering or private placement, upon notice of commencing such public offering or private placement, the Holders of IMS Common Stock subject to lock-up agreements will refrain from making any sales, transfers or other dispositions in the course of such offering until after the expiration of the Lock-Up Period.

By signing and returning this agreement, you further (i) represent and consent that you have full power and authority to enter into this lock-up agreement and that, upon request, you will execute any additional documents necessary or desirable in connection with this lock-up agreement and its enforcement, (ii) understand that this lock-up agreement is irrevocable by you, all authority herein conferred by you or agreed to be conferred by you shall survive your death or incapacity, and any of your obligations hereunder shall be binding on you and your heirs, personal representatives, successors and assigns, (iii) acknowledgement that this is agreement is entered into in favor of DSS and Seller who are relying upon its terms in entering into the Agreement, and (iv) acknowledge receipt of adequate consideration for providing this lock-up agre ement.
 
-78-

 
 
In order to enable the aforesaid covenant to be enforced, you hereby consent to the placing of a restrictive legend and/or stop-transfer order with the transfer agent of the Common Stock with respect to any of the Common Stock registered in your name or beneficially owned by you.

 
Whether registration of the Common Stock actually occurs depends on a number of factors. Notwithstanding the foregoing, this lock-up agreement will terminate upon expiration of the Lock-Up Period.
Accordingly, to evidence your agreement to the terms hereof, please date, and sign and return this lock-up agreement where indicated by law.


 
[SIGNATURE PAGE FOLLOWS]

 

--------------------------------------------------------------------------------



 





 
 
 
-79-

 
 
[SIGNATURE PAGE TO LOCK-UP AGREEMENT]

 
Acknowledged and Agreed
this ___ day of ____________, 2009:

 
/s/ Ray Meyers
Name: Ray Meyers (Holder 9,000,000 shares of Common Stock)



Acknowledged and Agreed
This ___ day of ___________, 2009:


/s/ Michael Buechler
Name: Michael Buechler (Holder 4,000,000 shares of Common Stock)
 
 
 
 
 
 
 
-80-

 
 
 
 

 
Exhibit H

Form Assignment and Assumption Agreement
 
 
 
 
 
 
 
 
 
 
 
 
-81-

 
ASSIGNMENT AND ASSUMPTION AGREEMENT
 
This Assignment and Assumption Agreement is made as of October ____, 2009 (the “Closing Date”), by and between Internet Media Services, Inc., a Delaware corporation (the “Buyer”), and lester levin Inc., a New York corporation (the “Seller”).  Capitalized terms use d but not defined in this Assignment and Assumption Agreement shall have the meanings given to them in that certain Asset Purchase Agreement, dated as of October ___, 2009, between the Buyer and the Seller, as the same may be amended (the “Agreement”).
 
 W I T N E S S E T H :
 
Whereas, pursuant and subject to the terms and conditions of the Agreement, the Seller is causing the Acquired Assets to be sold, assigned, transferred, conveyed and delivered to the Buyer; and
 
Whereas, in connection with the sale of the Acquired Assets to the Buyer, the Buyer and the Seller wish to provide for the limited assumption by the Buyer of certain obligations of the Seller (the “Assumed Liabilities,” as such term is defined in the Agreement).
 
Now, Therefore, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged:
 
1.   The Seller hereby sells, assigns, transfers, conveys and delivers to the Buyer all right, title and interest in, to and under each Assumed Liability; and
 
2.   The Buyer hereby assumes the obligations of the Seller under each Assumed Liability pursuant to the terms of the Agreement.
 
Notwithstanding anything to the contrary contained herein: (a) nothing contained in this Assignment and Assumption Agreement is intended to provide any rights to the Seller or Buyer (beyond those rights expressly provided to the Seller and Buyer, respectively, in the Agreement); (b) nothing contained in this Assignment and Assumption Agreement is intended to impose any obligations or liabilities on the Buyer or Seller (beyond those obligations and liabilities expressly imposed on the Buyer and Seller, respectively, in the Agreement); and (c) nothing contained in this Assignment and Assumption Agreement is intended to limit any of the rights or remedies available to the Buyer or Seller under the Agreement.
 
Nothing contained in this Assignment and Assumption Agreement is intended to provide any right or remedy to any person or entity, other than the Seller.
 
The Assignment and Assumption Agreement may be executed in any number of counterparts, each of which shall be an original, but all of which together shall constitute one instrument.
 
This Assignment and Assumption Agreement shall be construed in accordance with, and governed in all respects by, the internal laws of the State of New York (without giving effect to principles of conflicts of laws).
 
[End of Assignment and Assumption Agreement – Signature Page Follows]

 
 
 
 
 
 
 
 
-82-

 
 

 
 
 
Internet Media Services, Inc.
 
a Delaware corporation
   
   
   
 
By: /s/ Raymond Meyers                                            
 
Raymond Meyers
 
President and Chief Executive Officer
   
   
   
 
lester levin Inc.,
 
a New York  corporation
   
 
By: /s/ Patrick White                                             
 
Patrick White
 
President
 
 
-83-

 
 
 
 
Schedule 2.1(a)

Equipment
 
 
 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
-84-

 

Legalstore.Com Fixed Assets Listing


Neopost S130 folder/inserter
Warehouse Shelves
Cubicles and Desks
Legalstore door emblem
Legal Store – Phone System
Stern Properties – Leaseholds
2 Color Press-AB Dick
ATX MidTower
Legalstore Trade Show Booth
Legalstore Website- redesign
Legalstore.com Gproxy web site development
Triumph 20” cutter
9850 Color non-working press
AB Dick Digital Platemaker
APS Shrinkwrapper
Pitney Bowes lease (mail machine)
2 HP Laserjet 1160 printers
1 Laserjet 5si computer
2 Soyata computers
1 Lenovo Computer
2 HP P1505
Cannon Imagerunner 330
5 filing Cabinets
1 Paddy wagon
1 Drill
 
 
 
-85-

 

Schedule 2.1(b)

Inventory
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

 
 
-86-

 
 
 
Document Security Systems Inc
Custom Inventory Valuation Summary
End of Sep 2009
         
         
Item
Description
Inv. Value
On Hand
Inventory Item
       
180
Uncontested Divorce Kit, NY
$32.52
 
1.00
495
Journal of Notarial Acts, Hardcover
$45.20
 
2.00
595
Criminal Defense Case File
$47.52
 
66.00
597
3/4" Expansion Retention Jackets,
$71.06
 
209.00
601
Journal of Notarial Acts, Softcover
$31.90
 
2.00
801
9 x 12 Brown Kraft Gummed, No Clasp
$46.44
 
9.00
804
10 x 15 Brown Kraft Gummed, No Clasp, Open End
$95.21
 
9.00
805
9" x 12" Tyvek Open End White Envelopes, 100 per box.
$89.40
 
4.00
809
10" x 15" Tyvek Open End White Envelopes, 100 per box.
$54.16
 
2.00
815
10 x 13 White Wove Gummed, No Clasp, Open Side, 28lb
$24.80
 
4.00
820
9-1/2 x 12-1/2 Heavy Duty Envelopes, gummed flap
$59.79
 
3.00
821
10x15 Heavy Duty Envelopes, gummed flap
$59.79
 
3.00
824
10" x 13" Tyvek Open End White Envelopes, First Class, 100 per box.
$29.78
 
1.00
825
6.5" x 9.5" Tyvek Open End White Envelopes, First Class, 100 per box.
$49.50
 
2.00
826
9.5" x 12.5" Tyvek Open End White Envelopes, First Class, 100 per box.
$87.00
 
3.00
827
10" x 15" Tyvek Open End White Envelopes, First Class, 100 per box.
$112.20
 
4.00
828
Tyvek Mailer 12" x 15-1/2" Green Diamond First Class Envelope
$66.15
 
3.00
829
9" x 12" Tyvek Open End White Envelopes, First Class, 100 per box.
$100.80
 
4.00
835
Grey Kraft  Envelopes 9" x 12" Open End Clasp, 100 per box.
$41.83
 
3.00
836
Grey Kraft  Enveloes 9-1/2" x 12-1/2" Open End Clasp, 100 per box.
$129.68
 
8.00
837
Grey Kraft  Envelopes 10" x 13" Open End Clasp, 100 per box.
$13.39
 
1.00
838
Grey Kraft  Enveloes 10" x 15" Open End Clasp, 100 per box.
$59.53
 
3.00
847
5" x 3" white shipping labels, 6-up, (100 sheets per package)
$357.00
 
17.00
848
4" x 3-1/3" white shipping labels, 6-up, (100 sheets per package)
$117.30
 
15.00
901
Green Diamond Envelopes 9-1/2" x 12-1/2", First Class Mail, 100 per package.
$27.57
 
3.00
949
Patent Folder, Jute, Printed, , 10-1/4" x 15"
$23.12
 
8.00
1030
 
$37.80
 
2.00
2301
Testament Ledger Last Will & Testament Envelopes
$149.45
 
7.00
2302
Legal Size Testament Ledger Last Will & Testament Covers
$106.01
 
5.00
2303
Letter Size Testament Ledger Last Will & Testament Covers
$185.85
 
9.00
2304
Legal Size Testament Ledger Last Will & Testament Will Kit
$184.50
 
5.00
2306
Letter Size Testament Ledger Last Will & Testament Will Kit
$184.50
 
5.00
2307
Letter Size Pebble Finish Last Will & Testament Covers
$598.85
 
29.00
2308
Legal Size Pebble Finish Last Will & Testament Covers
$413.00
 
20.00
2309
Pebble Finish Last Will & Testament Envelopes
$330.40
 
16.00
2310
Pebble Finish Will Envelopes
$247.80
 
12.00
2311
Legal Size Pebble Finish Will Covers
$123.90
 
6.00
2312
Letter Size Pebble Finish Will Covers
$227.15
 
11.00
2313
Legal Size Pebble Finish Will Kit
$129.84
 
4.00
2314
Letter Size Pebble Finish Will Kit
$64.92
 
2.00
2316
Legal Size Testament Ledger, Last Will & Testament Paper
$125.80
 
10.00
2317
Legal Size Testament Ledger, Blank Paper
$147.05
 
17.00
2318
Letter Size Testament Ledger, Last Will & Testament Paper
$96.11
 
7.00
2319
Letter Size, Testament Ledger, Blank Paper
$112.45
 
13.00
2320
Legal Size Blue Ruled Will Paper
$53.44
 
8.00
2321
Letter Size Blue Ruled Will Paper
$17.88
 
4.00
2322
Letter Extra Size Red Ruled Will Paper
$64.30
 
10.00
2323
Wax Seal Red Replacement Bars
$14.10
 
2.00
2324
Legal Size Excelsior Bond Paper
$16.02
 
3.00
2326
Legal Size Excelsior Bond Will Paper
$62.10
 
5.00
2327
Letter Size Excelsior Bond Will Paper
$26.52
 
2.00
2328
Letter Size Excelsior Bond Paper
$10.35
 
3.00
 
 
-87-

 
2332
Legal Size Black Ruled Last Will & Testament Paper
$117.52
 
8.00
2333
Legal Size Black Ruled Paper
$53.15
 
5.00
2334
Letter Size Black Ruled Last Will & Testament Paper
$42.99
 
3.00
2335
Letter Size Black Ruled Paper
$10.63
 
1.00
2336
Legal Size Pebble Finish Last Will and Testament Kit
$66.54
 
2.00
2337
Letter Size Pebble Finish Last Will and Testament Kit
$66.54
 
2.00
2338
Pebble Finish Will Envelopes, Oversized
$58.26
 
1.00
2339
Pebble Finish Last Will & Testament Envelopes, Oversized
$291.30
 
5.00
2340
Pebble Finish Will Envelopes, Oversized
$120.54
 
3.00
2341
Pebble Finish Blank Envelopes
$165.20
 
8.00
2342
Pebble Finish Last Will & Testament Envelopes, Side Opening
$185.85
 
9.00
2343
Pebble Finish Declaration of Trust Envelopes
$48.36
 
2.00
2344
Pebble Finish Envelopes, Side Opening
$49.20
 
3.00
2345
Testament Ledger Blank Envelopes, Oversized
$309.00
 
5.00
2354
Legal Size Pebble Finish Declaration of Trust Covers
$46.08
 
2.00
2355
Letter Size Pebble Finish Declaration of Trust Covers
$49.56
 
2.00
2365
Legal Size Black Ruled Last Declaration of Trust Paper
$44.07
 
3.00
2366
Letter Size Black Ruled Last Declaration of Trust Paper
$44.07
 
3.00
3001
Letter Size Stock Presentation Folders, Black Linen
$267.24
 
393.00
3002
Letter Size Stock Presentation Folders, Dark Blue Linen
$307.36
 
452.00
3003
Letter Size Stock Presentation Folders, Burgundy Linen
$127.84
 
188.00
3004
Letter Size White Gloss Presentation Folders
$38.15
 
109.00
3005
Letter Size Stock Presentation Folders, Forest Green Linen
$348.16
 
512.00
3006
Letter Size Stock Presentation Folders, Red Wove
$131.24
 
193.00
3007
Letter Size Stock Presentation Folders, Brown Wove
$220.32
 
324.00
3008
Letter Size Stock Presentation Folders, Teal Wove
$23.80
 
35.00
3015
Bankruptcy Forms, Chapter 7,12 and 13
$53.46
 
2.00
3086
Certified mail labels, 8 1/2" x 7", 100 per box.
$102.22
 
1.00
3101
Legal Size Stock Presentation Folders, Black Linen
$282.48
 
321.00
3102
Legal Size Stock Presentation Folders, Dark Blue Linen
$300.08
 
341.00
3103
Legal Size Stock Presentation Folders, Burgundy Linen
$682.00
 
775.00
3104
Legal Size White Gloss Presentation Folders
$312.96
 
489.00
3105
Legal Size Stock Presentation Folders, Green Linen
$355.52
 
404.00
3106
Legal Size Stock Presentation Folders, Red Wove
$69.52
 
79.00
3107
Legal Size Stock Presentation Folders, Brown Wove
$71.28
 
81.00
3108
Legal Size Stock Presentation Folders, Teal Wove
$146.96
 
167.00
3115
Tribute® Document Wallets
$28.64
 
4.00
3116
Tribute® Presentation Wallets
$164.16
 
18.00
3140
Lead Paint Booklet
$3.00
 
12.00
3701
Consumer Law Pamphlets, What Your Should Know About Buying a Home
$73.58
 
2.00
3702
Consumer Law Pamphlets, What to Do if You're in an Auto Accident
$147.16
 
4.00
3703
Consumer Law Pamphlets, What You Should Know About Wills
$36.79
 
1.00
3704
Consumer Law Pamphlets, What You Should Know About Divorce
$36.79
 
1.00
3705
Consumer Law Pamphlets, When You Can't Pay Your Debts
$36.79
 
1.00
3706
Consumer Law Pamphlets, What You Should Know About Your Legal Health
$36.79
 
1.00
3707
Consumer Law Pamphlets, What You Should Know About Estate Planning
$36.79
 
1.00
3708
Consumer Law Pamphlets, What You Should Know About Obtaining Compensation For Your Personal Injuries
$36.79
 
1.00
3709
Consumer Law Pamphlets, What Your Should Know About Exercising Your Rights as an Employee
$36.79
 
1.00
3710
Consumer Law Pamphlets, What Your Should Know About Guardianship, Living Wills and Power of Attorney
$73.58
 
2.00
3711
Business Law Pamphlets, Collecting Accounts Receiveable and Business Debts
$73.58
 
2.00
3712
Business Law Pamphlets, Firing Employees
$36.79
 
2.00
3713
Business Law Pamphlets, Protecting Your Company's Legal Health
$18.40
 
1.00
3714
Business Law Pamphlets, Protecting Your Investment in Intellectual Property
$36.79
 
2.00
3715
Business Law Pamphlets, Doing Business as Limited Liability Company
$73.58
 
2.00
3716
Consumer Law Pamphlets, What Your Should Know About Social Security and Medicare
$36.79
 
1.00
3717
Consumer Law Pamphlets, What Your Should Know About Your Rights as a Landlord or Tenant
$36.79
 
1.00
3718
Consumer Law Pamphlets, What You Should Know If Your Are Arrested
$36.79
 
1.00
3719
Consumer Law Pamphlets, Preparing To Be a Witness at  Deposition or Trial
$36.79
 
1.00
3720
Consumer Law Pamphlets, What To Do When a Loved One Dies
$36.79
 
1.00
3721
Consumer Law Pamphlets, What Your Should Know About Marriage and the Law
$36.79
 
1.00
3722
Consumer Law Pamphlets, Adoption
$36.79
 
1.00
04220
Note Size Expanding Red Wallet with Elastic Tie
$42.00
 
50.00
04221
Letter Size Expanding Red Wallet with Elastic Tie
$29.50
 
50.00
 
 
-88-

 
04222
Legal Size Expanding Red Wallet with Elastic Tie
$21.25
 
34.00
04223
Tabloid Size Expanding Red Wallet with Elastic Tie
$45.00
 
50.00
4400
Tabloid Binder 11" x 17" 1" Capacity
$239.04
 
48.00
4500
Tabloid Binder 11" x 17" 2" Capacity
$363.15
 
45.00
4870
FLIP Labels
$22.50
 
1.00
5011
Rotary File Set, 3-Part
$56.93
 
3.00
5014
Case Index Files
$213.46
 
11.00
5015
Attorney New Matter Memo Carbonless Sets, 3-Part
$67.36
 
4.00
5016
Attorney New Matter Memo Carbonless Sets, 2-Part
$152.80
 
4.00
5017
Rotary File Set, 4-Part
$20.94
 
1.00
5019
Rotary File Set, 5-Part
$56.52
 
2.00
5020
File Label Index Sets, 4" x 6"
$165.60
 
7.00
5022
Basic Time Control System, 2-Part
$75.60
 
9.00
5023
Basic Time Control System, 3-Part
$44.46
 
3.00
5024
Basic Time Control System, 4-Part
$36.48
 
2.00
5025
Time and Expense Slips with Journal Sheets
$76.01
 
5.00
5026
Deluxe Walnut Grained Pegboard Portfolio
$50.30
 
2.00
5027
Attorney Complete Time Control System
$45.00
 
1.00
5030
Time and Expense Slips File Jackets
$44.64
 
3.00
5078
Workers Compensation INdexes
$9.87
 
7.00
5081
Estate Planning Indexes
$16.86
 
6.00
5082
Employment Litigation Indexes
$14.58
 
6.00
5083
Litigation Indexes
$16.50
 
5.00
5085
Family Law Index Dividers
$69.30
 
22.00
5086
Estate Administration Probate Indexes
$12.15
 
5.00
5088
Bankruptcy Case Indexes
$29.16
 
9.00
5090
Limited Partnership LP Tabs
$4.98
 
2.00
5092
Criminal Litigation Indexes
$19.44
 
6.00
5094
Ink Refill Automatic Numbering Machine
$5.52
 
1.00
5095
Immigration Law Indexes
$10.72
 
8.00
5099
Table of Contents, Letter Size Bottom Tab
$8.46
 
6.00
5106
Tabloid Size Bottom Blank Writeable Indexes
$92.00
 
23.00
5107
Letter Size Bottom Blank Writeable Indexes
$65.54
 
58.00
5108
Legal Size Bottom Blank Writeable Indexes
$135.05
 
73.00
5113
Plaintiff's Exhibit Goldenrod
$51.84
 
48.00
5114
Defendant's Exhibit Blue
$79.92
 
74.00
5115
Corporation Index Tabs, Standard
$2.37
 
1.00
5116
Blank Blue
$32.40
 
30.00
5117
Blank Goldenrod
$24.84
 
23.00
5118
Exhibit Goldenrod
$37.80
 
35.00
5119
Exhibit Blue
$91.80
 
85.00
5120
Black Beauty Slipcase
$23.52
 
3.00
5122
Government Exhibit Goldenrod
$95.04
 
88.00
5125
Medical Indexes
$18.33
 
13.00
5130
Transfer Ledger
$4.74
 
2.00
5133
Letter Size Bottom Exhibit Blank Writeable Indexes
$48.59
 
43.00
5134
Exhibit Table of Contents, 8 1/2" X 11", 36lb., white ledger stock
$18.90
 
1.00
5135
Letter Size Side Blank Writeable Indexes
$45.20
 
40.00
5136
Petitioner's Exhibit White
$41.04
 
38.00
5137
Blank White
$47.52
 
44.00
5138
State's Exhibit White
$18.36
 
17.00
5139
People's Exhibit White
$24.84
 
23.00
5140
Minute Paper Letter Size 20lb., 3-Hole Punched
$51.74
 
11.00
5141
Minute Paper Letter Size 20lb., Rectangular Rod Punched
$36.12
 
7.00
5142
Minute Paper Legal Size 20lb., 3-Hole Punched
$97.35
 
11.00
5143
Minute Paper Legal Size 20lb., Rectangular Rod Punched
$49.60
 
6.00
5144
Minute Paper Letter Size 28lb., 3-Hole Punched
$35.52
 
3.00
5145
Minute Paper Letter Size 28lb., Rectangular Rod Punched
$61.68
 
5.00
5147
Non-Profit Tabs
$2.55
 
1.00
5148
Limited Liability Company LLC Tabs
$5.40
 
2.00
5149
Notarial Seals
$63.38
 
26.00
5150
Minutes & By-Laws for Corporations, New York
$3.90
 
1.00
5152
Minutes & By-Laws for Corporations, New York Professional Corporation
$3.90
 
1.00
 
 
-89-

 
5153
Minutes & By-Laws for Corporations, New York Not-For-Profit
$3.90
 
1.00
5154
Model Operating Agreements for LLC, New York
$17.94
 
2.00
5160
Minutes & By-Laws for Corporations, Blank State
$7.80
 
2.00
5161
Minutes & By-Laws for Corporations, Blank State Membership Corporation
$3.90
 
1.00
5162
Minutes & By-Laws for Corporations, Blank State Professional Corporation, By-Laws Only
$7.80
 
2.00
5169
Minutes & By-Laws for Corporations, Missouri
$3.90
 
1.00
5170
Minutes & By-Laws for Corporations, California
$3.90
 
1.00
5171
Minutes & By-Laws for Corporations Connecticut
$7.80
 
2.00
5172
Minutes & By-Laws for Corporations, Delaware
$7.80
 
2.00
5173
Minutes & By-Laws for Corporations, Florida
$7.80
 
2.00
5174
Minutes & By-Laws for Corporations, New Jersey
$7.80
 
2.00
5175
Minutes & By-Laws for Corporations, Pennyslvania
$3.90
 
4.00
5176
Minutes & By-Laws for Corporations, Texas
$3.90
 
1.00
5177
Minutes & By-Laws for Corporations, Illinois
$3.90
 
1.00
5178
Minutes & By-Laws for Corporations, Michigan
$7.80
 
2.00
5179
Minutes & By-Laws for Corporations, Georgia
$3.90
 
1.00
5191
Exhibit Fluorescent Red
$23.76
 
22.00
5192
Exhibit Fluorescent Yellow
$33.48
 
31.00
5193
Defendant's Exhibit Fluorescent Red
$29.16
 
27.00
5194
Respondent's Exhibit Goldenrod
$114.48
 
106.00
5195
Trustee Exhibit Blue
$28.08
 
26.00
5196
Creditor Exhibit Goldenrod
$35.64
 
33.00
5197
Debtor Exhibit Blue
$37.80
 
35.00
5199
Plaintiff's Exhibit Fluorescent Yellow
$42.12
 
39.00
5206
Declaration White
$17.28
 
16.00
5207
Joint Exhibit White
$59.40
 
55.00
5208
Exhibit White
$34.56
 
32.00
5209
Deposition Exhibit White
$44.28
 
41.00
5298
Trust Portfolio Indexes
$26.73
 
9.00
07201
Half Page Size, Mini Roundring Binder, 1" Capacity
$86.40
 
48.00
08013
A4 Sheet Protector
$36.06
 
6.00
9012
Patent Receipt Card
$23.63
 
11.00
9013
Trademark Receipt Card
$2.15
 
1.00
9203
Patent Folder, Jute, Printed, Side Punched, 10" x 14-1/2"
$108.00
 
60.00
9204
Patent, jute, printed form, 10" x 15-1/8"
$592.76
 
292.00
9207
Patent, jute, printed form, 9" x 14-1/2"
$349.20
 
194.00
9216
Plain, jute, 10" x 14-3/4"
$144.00
 
80.00
9217
Plain, light green, 10" x 14-3/4"
$360.01
 
199.00
9218
Patent, Jute Printed Form, 10" x 14-3/4"
$78.75
 
42.00
9220
U.S. Trademark, rev. 11/89, blue, 10-1/4" x 15-1/8"
$279.00
 
155.00
9221
Foreign Patent Folder, Gray, 10-1/4" x 15-1/8"
$15.96
 
6.00
9222
Foreign TM/SM Madrid Protocol and single country, 10-1/4" x 15-1/8" goldenrod, ruled section for notes
$199.28
 
106.00
9223
Foreign, Trademark Folder, Gray 10-1/4" x 15"
$385.32
 
169.00
9225
Patent Folder, Jute with Printed Form, 10" x 14-3/4"
$288.26
 
142.00
9228
Foreign, Patent Folder, Gray 10-1/4" x 15-1/8"
$598.85
 
295.00
9230
Plain Patent or Trademark Folder, Jute,  10-1/4" x 15-1/8"
$95.37
 
33.00
9231
Patent Folder, Jute,  10-1/4" x 15"
$34.20
 
19.00
9232
Domain name file, 10 1/4" x 15 1/8", orange,
$471.75
 
111.00
9240
U.S. Trademark, rev. 11/89, gray, 10-1/4" x 15-1/8"
$35.18
 
14.00
09261
Letter Size, Vertical Easel Ring Binder
$39.12
 
6.00
10310
Letter Size Folders, Reinforced Top Tab, Straight-Cut, Manila
$30.96
 
3.00
10330
Letter Size 1/3-Cut Manila Folders, Single-Ply
$19.47
 
3.00
10334
Letter Size 1/3-Cut Manila Folders, Reinforced Tab
$29.91
 
3.00
10434
Letter Size 1/3-Cut Manila Folders, Heavy Duty
$82.12
 
4.00
10734
Letter Size Folders, Reinforced Top Tab, 1/3-Cut, Kraft
$102.41
 
7.00
11777
Smead Alphabetic Folder Set A-Z
$29.20
 
5.00
12010
Letter Size Folders, Reinforced Top Tab, Straight-Cut, Blue
$39.50
 
2.00
12034
Letter Size Folders, Reinforced Top Tab, 1/3-Cut, Blue
$97.80
 
6.00
12040
Letter Size Folders, Reinforced Top Tab, 1/3-Cut, with Fasteners, Blue
$100.75
 
5.00
12110
Letter Size Folders, Reinforced Top Tab, Straight-Cut, Green
$39.50
 
2.00
12134
Letter Size Folders, Reinforced Top Tab, 1/3-Cut, Green
$81.50
 
5.00
12140
Letter Size Folders, Reinforced Top Tab, 1/3-Cut, with Fasteners, Green
$80.60
 
4.00
12142
Easyopen Ledger Slant-D Ring Binders, Tabloid Size, 17" x 11", 3" Capacity
$106.24
 
8.00
 
 
-90-

 
12210
Letter Size Folders, Reinforced Top Tab, Straight-Cut, Goldenrod
$138.25
 
7.00
12234
Letter Size Folders, Reinforced Top Tab, 1/3-Cut, Goldenrod
$65.20
 
4.00
12310
Letter Size Folders, Reinforced Top Tab, Straight-Cut, Gray
$39.50
 
2.00
12334
Letter Size Folders, Reinforced Top Tab, 1/3-Cut, Gray
$114.25
 
7.00
12410
Letter Size Folders, Reinforced Top Tab, Straight-Cut, Lavender
$39.50
 
2.00
12434
Letter Size Folders, Reinforced Top Tab, 1/3-Cut, Lavender
$48.90
 
3.00
12440
Letter Size Folders, Reinforced Top Tab, 1/3-Cut, with Fasteners, Lavender
$100.75
 
5.00
12510
Letter Size Folders, Reinforced Top Tab, Straight-Cut, Orange
$39.50
 
2.00
12534
Letter Size Folders, Reinforced Top Tab, 1/3-Cut, Orange
$114.10
 
7.00
12540
Letter Size Folders, Reinforced Top Tab, 1/3-Cut, with Fasteners, Orange
$100.75
 
5.00
12610
Letter Size Folders, Reinforced Top Tab, Straight-Cut, Pink
$118.50
 
6.00
12634
Letter Size Folders, Reinforced Top Tab, 1/3-Cut, Pink
$130.40
 
8.00
12710
Letter Size Folders, Reinforced Top Tab, Straight-Cut, Red
$118.50
 
6.00
12734
Letter Size Folders, Reinforced Top Tab, 1/3-Cut, Red
$81.50
 
5.00
12740
Letter Size Folders, Reinforced Top Tab, 1/3-Cut, with Fasteners, Red
$100.75
 
5.00
12810
Letter Size Folders, Reinforced Top Tab, Straight-Cut, White
$118.50
 
6.00
12834
Letter Size Folders, Reinforced Top Tab, 1/3-Cut, White
$97.95
 
6.00
12910
Letter Size Folders, Reinforced Top Tab, Straight-Cut, Yellow
$138.25
 
7.00
12934
Letter Size Folders, Reinforced Top Tab, 1/3-Cut, Yellow
$65.20
 
4.00
12940
Letter Size Folders, Reinforced Top Tab, 1/3-Cut, with Fasteners, Yellow
$80.60
 
4.00
13034
Letter Size Folders, Reinforced Top Tab, 1/3-Cut, Purple
$65.20
 
4.00
13084
Letter Size Folders, Reinforced Top Tab, 1/3-Cut, Maroon
$81.50
 
5.00
13134
Letter Size Folders, Reinforced Top Tab, 1/3-Cut, Teal
$48.99
 
3.00
14000
Letter Size Manila Classification Folder, 2" Expansion
$86.80
 
40.00
14232
Legal Size, 3-Ring Slant-D Binder, 1" Capacity
$21.81
 
3.00
14532
Legal Size, 3-Ring Slant-D Binder, 2" Capacity
$53.60
 
5.00
14632
Legal Size, 4-Ring Slant-D Binder, 2" Capacity
$160.72
 
14.00
15330
Legal Size 1/3-Cut Manila Folders, Single-Ply
$91.96
 
11.00
15334
Legal Size 1/3-Cut Manila Folders, Reinforced Tab
$65.20
 
5.00
15434
Legal Size 1/3-Cut Manila Folders, Heavy Duty
$115.00
 
5.00
15440
Letter Size Vertical File Pocket & Identification System
$60.06
 
11.00
15460
Legal Size Vertical File Pocket & Identification System
$62.20
 
10.00
17010
Legal Size Folders, Reinforced Top Tab, Straight Cut, Blue
$150.66
 
6.00
17034
Legal Size Folders, Reinforced Top Tab, 1/3-Cut, Blue
$78.76
 
4.00
17040
Legal Size Folders, Reinforced Top Tab, 1/3-Cut, with Fasteners
$165.40
 
7.00
17110
Legal Size Folders, Reinforced Top Tab, Straight Cut, Green
$100.44
 
4.00
17134
Legal Size Folders, Reinforced Top Tab, 1/3-Cut, Green
$103.85
 
6.00
17140
Legal Size Folders, Reinforced Top Tab, 1/3-Cut, with Fasteners
$69.30
 
3.00
17210
Legal Size Folders, Reinforced Top Tab, Straight Cut, Goldenrod
$75.33
 
3.00
17234
Legal Size Folders, Reinforced Top Tab, 1/3-Cut, Goldenrod
$114.25
 
5.00
17310
Legal Size Folders, Reinforced Top Tab, Straight Cut, Gray
$100.44
 
4.00
17334
Legal Size Folders, Reinforced Top Tab, 1/3-Cut, Gray
$59.07
 
3.00
17410
Legal Size Folders, Reinforced Top Tab, Straight Cut, Lavender
$100.44
 
4.00
17434
Legal Size Folders, Reinforced Top Tab, 1/3-Cut, Lavender
$114.25
 
5.00
17510
Legal Size Folders, Reinforced Top Tab, Straight Cut, Orange
$100.44
 
4.00
17534
Legal Size Folders, Reinforced Top Tab, 1/3-Cut, Orange
$45.70
 
2.00
17610
Legal Size Folders, Reinforced Top Tab, Straight Cut, Pink
$100.44
 
4.00
17634
Legal Size Folders, Reinforced Top Tab, 1/3-Cut, Pink
$114.25
 
5.00
17710
Legal Size Folders, Reinforced Top Tab, Straight Cut, Red
$50.22
 
2.00
17734
Legal Size Folders, Reinforced Top Tab, 1/3-Cut, Red
$45.70
 
2.00
17740
Legal Size Folders, Reinforced Top Tab, 1/3-Cut, with Fasteners
$92.40
 
4.00
17810
Legal Size Folders, Reinforced Top Tab, Straight Cut, White
$100.44
 
4.00
17834
Legal Size Folders, Reinforced Top Tab, 1/3-Cut, White
$114.25
 
5.00
17910
Legal Size Folders, Reinforced Top Tab, Straight Cut, Yellow
$125.55
 
5.00
17934
Legal Size Folders, Reinforced Top Tab, 1/3-Cut, Yellow
$59.07
 
3.00
17940
Legal Size Folders, Reinforced Top Tab, 1/3-Cut, with Fasteners
$147.85
 
6.00
18043
Prestige Locking D-Ring Binder, 3" Capacity, Letter Size, Dark Blue
$38.94
 
6.00
18046
Prestige Locking D-Ring Binder, 3" Capacity, Letter Size, Maroon
$38.94
 
6.00
18053
Prestige Locking D-Ring Binder, 4" Capacity, Letter Size, Dark Blue
$60.24
 
6.00
18056
Prestige Locking D-Ring Binder, 4" Capacity, Letter Size, Maroon
$60.24
 
6.00
18063
Prestige Locking D-Ring Binder, 5" Capacity, Letter Size, Dark Blue
$65.76
 
4.00
18066
Prestige Locking D-Ring Binder, 5" Capacity, Letter Size, Maroon
$32.88
 
2.00
18175
Letter Size Poly Vertical Expanding File
$37.32
 
12.00
 
 
-91-

 
18195
Legal Size Poly Vertical Expanding File
$41.80
 
11.00
19000
Legal Size Manila Classification Folder, 2" Expansion
$116.13
 
49.00
19934
Legal Size, 1/3-Cut Pressboard Fastener Folders
$104.40
 
72.00
21043
Letter Size Poly Expanding Wallet
$49.45
 
23.00
21045
Legal Size Poly Expanding Wallet
$80.24
 
34.00
23300
Laser Exhibit Labels, Kleer-Fax Brand, White
$33.18
 
14.00
23301
Laser Exhibit Labels, Kleer-Fax Brand, Blue
$33.18
 
14.00
23302
Laser Exhibit Labels, Kleer-Fax Brand, Yellow
$7.11
 
3.00
23303
Laser Exhibit Labels, Kleer-Fax Brand, Red
$21.33
 
9.00
23304
Laser Exhibit Labels, Kleer-Fax Brand, Green
$21.33
 
9.00
23305
Laser Exhibit Labels, Kleer-Fax Brand, Orange
$26.07
 
11.00
25040
Letter Size Folders, Reinforced End Tab, Straight-Cut with Fasteners, Blue
$61.95
 
3.00
25140
Letter Size Folders, Reinforced End Tab, Straight-Cut with Fasteners, Green
$103.25
 
5.00
25540
Letter Size Folders, Reinforced End Tab, Straight-Cut with Fasteners, Lavender
$103.25
 
5.00
25640
Letter Size Folders, Reinforced End Tab, Straight-Cut with Fasteners, Orange
$82.60
 
4.00
25740
Letter Size Folders, Reinforced End Tab, Straight-Cut with Fasteners, Red
$61.95
 
3.00
25849
Letter Size Folders, Reinforced End Tab, Straight-Cut with Fasteners, Gray
$103.25
 
5.00
25940
Letter Size Folders, Reinforced End Tab, Straight-Cut with Fasteners, Yellow
$103.25
 
5.00
28010
Legal Size Folders, Reinforced End Tab, Straight-Cut, Blue
$85.59
 
3.00
28040
Legal Size Folders, Reinforced End Tab, Straight-Cut with Fasteners, Blue
$144.90
 
6.00
28110
Legal Size Folders, Reinforced End Tab, Straight-Cut, Green
$85.59
 
3.00
28140
Legal Size Folders, Reinforced End Tab, Straight-Cut with Fasteners, Green
$144.90
 
6.00
28210
Legal Size Folders, Reinforced End Tab, Straight-Cut, Goldenrod
$57.06
 
2.00
28310
Legal Size Folders, Reinforced End Tab, Straight-Cut, Gray
$85.59
 
3.00
28410
Legal Size Folders, Reinforced End Tab, Straight-Cut, Lavender
$57.06
 
2.00
28510
Legal Size Folders, Reinforced End Tab, Straight-Cut, Orange
$142.65
 
5.00
28610
Legal Size Folders, Reinforced End Tab, Straight-Cut, Pink
$142.65
 
5.00
28710
Legal Size Folders, Reinforced End Tab, Straight-Cut, Red
$57.06
 
2.00
28740
Legal Size Folders, Reinforced End Tab, Straight-Cut with Fasteners, Red
$169.05
 
7.00
28810
Legal Size Folders, Reinforced End Tab, Straight-Cut, White
$85.59
 
3.00
28910
Legal Size Folders, Reinforced End Tab, Straight-Cut, Yellow
$114.12
 
4.00
28940
Legal Size Folders, Reinforced End Tab, Straight-Cut with Fasteners, Yellow
$48.30
 
2.00
31000
Permanent Index Tabs Blank
$29.60
 
20.00
31001
Permanent Index Tabs, Numeric 1-10
$28.12
 
19.00
31002
Permanent Index Tabs, Numeric 11-20
$11.84
 
8.00
31005
Permanent Index Tabs A-Z
$8.88
 
6.00
33001
Laser Index Tabs 7/16" White
$51.95
 
11.00
33117
Laser Index Tabs 1-1/8" White
$20.00
 
4.00
33120
Laser Index Tabs 1-1/8" Assorted
$30.00
 
6.00
33301
Laser Page Flags
$63.68
 
16.00
37715
Straight Cut Legal Size 2" Expansion
$156.18
 
114.00
48090
U-Create Exhibit Labels, White
$94.80
 
24.00
48091
U-Create Exhibit Labels, Blue
$63.20
 
16.00
48093
U-Create Exhibit Labels, Red
$75.05
 
19.00
48094
U-Create Exhibit Labels, Green
$51.35
 
13.00
48095
U-Create Exhibit Labels, Orange
$47.40
 
12.00
51051
Exhibit 1, Blumberg® Style, Bottom Tab, Letter Size.
$30.94
 
34.00
51052
Exhibit 2, Blumberg® Style, Bottom Tab, Letter Size.
$23.66
 
26.00
51053
Exhibit 3, Blumberg® Style, Bottom Tab, Letter Size.
$20.93
 
23.00
51054
Exhibit 4, Blumberg® Style, Bottom Tab, Letter Size.
$16.38
 
18.00
51055
Exhibit 5, Blumberg® Style, Bottom Tab, Letter Size.
$5.46
 
6.00
51056
Exhibit 6, Blumberg® Style, Bottom Tab, Letter Size.
$6.04
 
9.00
51057
Exhibit 7, Blumberg® Style, Bottom Tab, Letter Size.
$11.18
 
11.00
51058
Exhibit 8, Blumberg® Style, Bottom Tab, Letter Size.
$6.37
 
7.00
51059
Exhibit 9, Blumberg® Style, Bottom Tab, Letter Size.
$10.01
 
11.00
51281
Exhibit 1, Blumberg® Style, Side Tab, Letter Size.
$12.74
 
14.00
51282
Exhibit 2, Blumberg® Style, Side Tab, Letter Size.
$16.38
 
18.00
51283
Exhibit 3, Blumberg® Style, Side Tab, Letter Size.
$13.65
 
15.00
51284
Exhibit 4, Blumberg® Style, Side Tab, Letter Size.
$18.20
 
20.00
51285
Exhibit 5, Blumberg® Style, Side Tab, Letter Size.
$14.56
 
16.00
51286
Exhibit 6, Blumberg® Style, Side Tab, Letter Size.
$13.65
 
15.00
51287
Exhibit 7, Blumberg® Style, Side Tab, Letter Size.
$10.92
 
12.00
51288
Exhibit 8, Blumberg® Style, Side Tab, Letter Size.
$22.75
 
25.00
 
 
-92-

 
51289
Exhibit 9, Blumberg® Style, Side Tab, Letter Size.
$13.65
 
15.00
53070
Personal and Confidential Security Seals
$29.88
 
6.00
57000
1-100 legal exhibit index tabs
$22.77
 
9.00
57001
101-200 legal exhibit index tabs
$30.36
 
12.00
57002
201-300 legal exhibit index tabs
$48.07
 
19.00
57003
301-400 legal exhibit index tabs
$32.89
 
13.00
57004
401-500 legal exhibit index tabs
$22.77
 
9.00
57005
501-600 legal exhibit index tabs
$10.12
 
4.00
57006
601-700 legal exhibit index tabs
$27.83
 
11.00
57007
701-800 legal exhibit index tabs
$10.12
 
4.00
57008
801-900 legal exhibit index tabs
$10.12
 
4.00
57009
901-1000 legal exhibit index tabs
$10.12
 
4.00
58000
1-10 legal exhibit index tabs
$73.37
 
29.00
58001
11-20 legal exhibit index tabs
$43.01
 
17.00
58002
21-30 legal exhibit index tabs
$32.89
 
13.00
58003
31-40 legal exhibit index tabs
$27.83
 
11.00
58004
41-50 legal exhibit index tabs
$35.42
 
14.00
58005
51-60 legal exhibit index tabs
$27.83
 
11.00
58006
61-70 legal exhibit index tabs
$43.01
 
17.00
58007
71-80 legal exhibit index tabs
$40.48
 
16.00
58008
81-90 legal exhibit index tabs
$32.89
 
13.00
58009
91-100 legal exhibit index tabs
$30.36
 
12.00
58010
A-E legal exhibit index tabs
$7.59
 
3.00
58011
F-J legal exhibit index tabs
$10.12
 
4.00
58012
K-O legal exhibit index tabs
$2.53
 
1.00
58013
P-T legal exhibit index tabs
$5.06
 
2.00
58014
U-Z legal exhibit index tabs
$2.53
 
1.00
58024
Defendant's Exhibit Yellow
$79.65
 
27.00
58025
Plaintiff's Exhibit Green
$47.20
 
16.00
58026
Petitioner's Exhibit Orange
$44.25
 
15.00
58027
Respondent's Exhibit Blue
$29.50
 
10.00
58071
Exhibit A legal exhibit index tabs
$10.12
 
4.00
58072
Exhibit B legal exhibit index tabs
$25.30
 
10.00
58073
Exhibit C legal exhibit index tabs
$22.77
 
9.00
58074
Exhibit D legal exhibit index tabs
$48.07
 
19.00
58075
Exhibit E legal exhibit index tabs
$7.59
 
3.00
58090
Exhibit Yellow
$20.65
 
7.00
58091
Exhibit Blue
$41.30
 
14.00
58092
Exhibit White
$23.60
 
8.00
58093
Defendant's Exhibit Blue
$73.75
 
25.00
58094
Plaintiff's Exhibit Yellow
$56.05
 
19.00
58095
Deposition Exhibit Red
$44.25
 
15.00
60155
Letter Size Double Pocket Divider for 3-Hole Punch Binder
$10.98
 
9.00
60315
RUSH! Page Flag
$14.75
 
5.00
60435
Notarize Page Flag
$5.90
 
2.00
61028
Letter Size Heavyweight Vinyl Sheet Protector
$19.84
 
2.00
61047
Legal Size Expansion Sheet Protector
$75.44
 
8.00
62047
Legal Size Sheet Protectors
$10.30
 
1.00
62058
Half Page Sheet Protectors
$15.66
 
4.00
62138
Letter Size, Deluxe Clear Vinyl Folders
$116.56
 
188.00
62139
Legal Size, Deluxe Clear Vinyl Folders
$89.88
 
107.00
62237
Tabloid Size Page Protectors
$9.78
 
1.00
68191
Poly Expanding Pocket
$29.64
 
57.00
68215
Reinforced Self-Adhesive Fasteners, 2" Prong Capacity
$37.50
 
5.00
68305
Monthly Side Tabs, 2 sets per pack, letter size
$3.15
 
1.00
70185
Adhesive Add On Pockets
$12.36
 
4.00
70238
Self Adhesive Business Card Holders
$8.24
 
4.00
70568
Self-Adhesive CD Holder
$15.61
 
7.00
71011
Legal Size, Redrope Expanding Wallets, 5-1/4" Expansion
$134.00
 
50.00
71014
Solid Arrow, Yellow Page Flag
$8.85
 
3.00
71024
Solid Arrow, Red Page Flag
$5.90
 
2.00
71186
Letter Size, Extra Wide, Redrope Expanding Wallets
$79.25
 
25.00
71189
Legal Size, Extra Wide, Redrope Expanding Wallets
$100.92
 
29.00
 
 
-93-

 
71456
Legal Size, Leather-Like Expanding Wallets
$157.00
 
50.00
73805
Letter Size Redrope File Pockets, 3-1/2" Expansion
$21.90
 
30.00
73810
Letter Size Redrope File Pockets, 5-1/2" Expansion
$189.00
 
225.00
74679
Legal Size Redrope File Pockets, 3-1/2" Expansion, Blue Gusset
$313.50
 
150.00
74680
Legal Size Redrope File Pockets, 3-1/2" Expansion, Green Gusset
$125.40
 
60.00
74681
Legal Size Redrope File Pockets, 3-1/2" Expansion, Dark Brown Gusset
$41.80
 
20.00
74686
Legal Size Redrope File Pockets, 3-1/2" Expansion, Red Gusset
$41.80
 
20.00
74688
Legal Size Redrope File Pockets, 3-1/2" Expansion, Yellow Gusset
$41.80
 
20.00
74689
Legal Size Redrope File Pockets, 5-1/4" Expansion
$75.00
 
30.00
74690
Legal Size Redrope File Pockets, 5-1/4" Expansion
$75.00
 
30.00
74691
Legal Size Redrope File Pockets, 5-1/4" Expansion
$37.50
 
15.00
74696
Legal Size Redrope File Pockets, 5-1/4" Expansion
$240.00
 
96.00
74698
Legal Size Redrope File Pockets, 5-1/4" Expansion
$267.50
 
107.00
74805
Legal Size Redrope File Pockets, 3-1/2" Expansion
$39.00
 
50.00
74810
Legal Size Redrope File Pockets, 5-1/2" Expansion
$24.00
 
25.00
77252
Letter Size Colored Expanding Wallet, Blue
$54.94
 
41.00
77253
Letter Size Colored Expanding Wallet, Green
$64.32
 
48.00
77259
Letter Size Colored Expanding Wallet, Red
$65.66
 
49.00
77261
Letter Size Colored Expanding Wallet, Yellow
$60.30
 
45.00
77272
Legal Size Colored Expanding Wallet, Blue
$81.20
 
56.00
77273
Legal Size Colored Expanding Wallet, Green
$59.45
 
41.00
77279
Legal Size Colored Expanding Wallet, Red
$71.05
 
49.00
77281
Legal Size Colored Expanding Wallet, Yellow
$68.15
 
47.00
77816
Flat Wallet, Manila, Legal Size
$7.20
 
15.00
78208
Pressboard Mortgage Folders
$112.71
 
39.00
78630
Casebinders, Legal Size, Blue
$71.10
 
79.00
78640
Casebinders, Legal Size, Green
$86.40
 
96.00
78650
Casebinders, Legal Size, Goldenrod
$90.00
 
100.00
78660
Casebinders, Legal Size, Gray
$63.00
 
70.00
78670
Casebinders, Legal Size, Red
$90.00
 
100.00
78680
Casebinders, Legal Size, Redrope
$90.00
 
100.00
79033
Open End Legal Envelopes, 1" Expansion
$35.50
 
50.00
79035
Open End Legal Envelopes, 2" Expansion
$47.50
 
50.00
81024
Sign Here Page Flag
$2.95
 
1.00
81041
Please Sign, Date & Mail Page Flag
$2.95
 
1.00
81046
Please Sign, Date & Time Page Flag
$17.70
 
6.00
81052
Binder Cover, Letter Size, 3" Capacity, Blue
$60.75
 
45.00
81054
Sign & Date Page Flag
$17.70
 
6.00
81114
Please Initial Page Flag
$5.90
 
2.00
81124
Pressguard® Covers, Letter Size, Black
$175.23
 
99.00
81132
Pressguard® Covers, Legal Size, Black
$92.45
 
43.00
81152
Binder Cover, Letter Size, 3" Capacity, Black
$48.60
 
36.00
81178
Pressguard® Covers, Tabloid Size, Black
$98.21
 
35.00
81252
Binder Cover, Letter Size, 3" Capacity, Bright Red
$47.25
 
35.00
81344
Please Sign & Return Page Flag
$8.85
 
3.00
81352
Binder Cover, Letter Size, 3" Capacity, Dark Blue
$39.15
 
29.00
81364
Missing Information Page Flag
$5.90
 
2.00
81374
Witness Page Flag
$2.95
 
1.00
81452
Binder Cover, Letter Size, 3" Capacity, Green
$64.80
 
48.00
81552
Binder Cover, Letter Size, 3" Capacity, Gray
$44.55
 
33.00
81704
Pressboard Binder Cover, Half Page Size
$25.35
 
15.00
81724
Pressguard® Covers, Letter Size, Red
$88.50
 
59.00
81732
Pressguard® Covers, Legal Size, Red
$120.40
 
56.00
81752
Binder Cover, Letter Size, 3" Capacity, Red
$59.40
 
44.00
81762
Pressguard® Covers, Legal Size, 3" Capacity
$108.00
 
45.00
81778
Pressguard® Covers, Tabloid Size, Red
$190.81
 
68.00
81852
Binder Cover, Letter Size, 3" Capacity, Yellow
$35.10
 
26.00
83052
PressGuard® Binder Covers, Punchless Style Fastener
$26.75
 
12.00
84181
Letter Size Poly-String Envelope
$57.12
 
56.00
85780
Poly Translucent Project Jackets, Legal Size
$41.55
 
15.00
85781
Poly Translucent Project Jackets, Legal Size
$91.41
 
33.00
87152
Leatherette Report Cover, Blue
$5.85
 
15.00
87153
Leatherette Report Cover, Black
$7.41
 
19.00
 
 
-94-

 
87154
Leatherette Report Cover, Dark Blue
$10.14
 
26.00
87155
Leatherette Report Cover, Green
$11.31
 
29.00
87158
Leatherette Report Cover, Orange
$38.61
 
99.00
87159
Leatherette Report Cover, Red
$12.87
 
33.00
87161
Leatherette Report Cover, White
$13.65
 
35.00
87162
Leatherette Report Cover, Yellow
$9.36
 
24.00
87852
Pocket Portfolios, Letter Size, Blue
$18.33
 
65.00
87853
Pocket Portfolios, Letter Size, Black
$12.74
 
49.00
87854
Pocket Portfolios, Letter Size, Dark Blue
$12.48
 
48.00
87855
Pocket Portfolios, Letter Size, Green
$21.84
 
24.00
87856
Pocket Portfolios, Letter Size, Gray
$7.20
 
24.00
87857
Pocket Portfolios, Letter Size, Ivory
$47.70
 
49.00
87858
Pocket Portfolios, Letter Size, Orange
$18.33
 
65.00
87859
Pocket Portfolios, Letter Size, Red
$22.75
 
25.00
87860
Pocket Portfolios, Letter Size, Tan
$16.36
 
58.00
87861
Pocket Portfolios, Letter Size, White
$13.00
 
50.00
87862
Pocket Portfolios, Letter Size, Yellow
$13.00
 
50.00
87865
Pocket Portfolios, Letter Size, Lavender
$13.00
 
50.00
87866
Pocket Portfolios, Letter Size, Pink
$21.15
 
75.00
87867
Pocket Portfolios, Letter Size, Teal
$13.00
 
50.00
89500
Three-Ring Envelopes
$103.73
 
23.00
111063
Left Ruled Canary Legal Size Legal Pads
$221.81
 
14.00
111065
Litigation Ruled Canary Legal Size Legal Pads
$63.40
 
4.00
111067
Left Ruled Canary Letter Size Legal Pads
$30.86
 
2.00
111069
Litigation Ruled Canary Letter Size Legal Pads
$207.90
 
18.00
505711
File/Pleading Backers with Prong Fasteners, 8 1/2" x 11 1/4"
$92.00
 
5.00
505714
File/Pleading Backers with Prong Fasteners, 8 1/2" x 14 1/4", 11pt.
$175.50
 
9.00
510510
Exhibit 10, Blumberg® Style, Bottom Tab, Letter Size.
$16.38
 
18.00
510511
Exhibit 11, Blumberg® Style, Bottom Tab, Letter Size.
$10.01
 
11.00
510512
Exhibit 12, Blumberg® Style, Bottom Tab, Letter Size.
$8.19
 
9.00
510513
Exhibit 13, Blumberg® Style, Bottom Tab, Letter Size.
$12.74
 
14.00
510514
Exhibit 14, Blumberg® Style, Bottom Tab, Letter Size.
$6.37
 
7.00
510515
Exhibit 15, Blumberg® Style, Bottom Tab, Letter Size.
$7.28
 
8.00
510516
Exhibit 16, Blumberg® Style, Bottom Tab, Letter Size.
$3.64
 
4.00
510517
Exhibit 17, Blumberg® Style, Bottom Tab, Letter Size.
$8.19
 
9.00
510518
Exhibit 18, Blumberg® Style, Bottom Tab, Letter Size.
$10.01
 
11.00
510519
Exhibit 19, Blumberg® Style, Bottom Tab, Letter Size.
$10.92
 
12.00
510520
Exhibit 20, Blumberg® Style, Bottom Tab, Letter Size.
$41.86
 
46.00
510521
Exhibit 21, Blumberg® Style, Bottom Tab, Letter Size.
$9.10
 
10.00
510522
Exhibit 22, Blumberg® Style, Bottom Tab, Letter Size.
$3.64
 
4.00
510523
Exhibit 23, Blumberg® Style, Bottom Tab, Letter Size.
$10.92
 
12.00
510524
Exhibit 24, Blumberg® Style, Bottom Tab, Letter Size.
$10.01
 
11.00
510525
Exhibit 25, Blumberg® Style, Bottom Tab, Letter Size.
$10.01
 
11.00
512810
Exhibit 10, Blumberg® Style, Side Tab, Letter Size.
$10.92
 
12.00
512811
Exhibit 11, Blumberg® Style, Side Tab, Letter Size.
$6.37
 
7.00
512812
Exhibit 12, Blumberg® Style, Side Tab, Letter Size.
$10.01
 
11.00
512813
Exhibit 13, Blumberg® Style, Side Tab, Letter Size.
$12.74
 
14.00
512814
Exhibit 14, Blumberg® Style, Side Tab, Letter Size.
$7.28
 
8.00
512815
Exhibit 15, Blumberg® Style, Side Tab, Letter Size.
$9.10
 
10.00
512816
Exhibit 16, Blumberg® Style, Side Tab, Letter Size.
$10.92
 
12.00
512817
Exhibit 17, Blumberg® Style, Side Tab, Letter Size.
$4.55
 
5.00
512818
Exhibit 18, Blumberg® Style, Side Tab, Letter Size.
$7.28
 
8.00
512819
Exhibit 19, Blumberg® Style, Side Tab, Letter Size.
$11.83
 
13.00
512820
Exhibit 20, Blumberg® Style, Side Tab, Letter Size.
$9.10
 
10.00
512821
Exhibit 21, Blumberg® Style, Side Tab, Letter Size.
$3.64
 
4.00
512822
Exhibit 22, Blumberg® Style, Side Tab, Letter Size.
$7.28
 
8.00
512823
Exhibit 23, Blumberg® Style, Side Tab, Letter Size.
$16.38
 
18.00
512824
Exhibit 24, Blumberg® Style, Side Tab, Letter Size.
$7.28
 
8.00
512825
Exhibit 25, Blumberg® Style, Side Tab, Letter Size.
$7.28
 
8.00
5057113
File/Pleading Backers with Prong Fasteners, 8 1/2" x 11 1/4", 11pt., 1/3 Cut Tab
$194.25
 
7.00
5057143
File/Pleading Backers with Prong Fasteners, 8 1/2" x 14 1/4", 11pt., 1/3 Cut Tab
$52.50
 
2.00
10X15U
10 x 15 Document Envelope, Ungummed
$1,331.00
 
64.00
111063P
Left Ruled Canary Legal Size Legal Pads 2 Hole Top Punched
$31.70
 
2.00
 
 
-95-

 
111065P
Litigation Ruled Canary Legal Size Legal Pads 2 Hole Top Punched
$47.55
 
3.00
111069P
Litigation Ruled Canary Letter Size Legal Pads 2 Hole Top Punched
$15.61
 
1.00
1186A
A, Blumberg® Style, Side Tab, Letter Size.
$9.10
 
10.00
1186AZ
Blumberg® Style, Side Tabs, Letter, Collated A-Z
$16.20
 
15.00
1186B
B Blumberg® Style, Side Tab, Letter Size.
$37.31
 
41.00
1186C
C Blumberg® Style, Side Tab, Letter Size.
$8.19
 
9.00
1186D
D Blumberg® Style, Side Tab, Letter Size.
$8.19
 
9.00
1186E
E Blumberg® Style, Side Tab, Letter Size.
$24.57
 
27.00
1186F
F Blumberg® Style, Side Tab, Letter Size.
$26.39
 
29.00
1186G
G Blumberg® Style, Side Tab, Letter Size.
$24.57
 
27.00
1186H
H Blumberg® Style, Side Tab, Letter Size.
$11.83
 
13.00
1186I
I Blumberg® Style, Side Tab, Letter Size.
$11.83
 
13.00
1186J
J Blumberg® Style, Side Tab, Letter Size.
$6.37
 
7.00
1186K
K Blumberg® Style, Side Tab, Letter Size.
$3.64
 
4.00
1186M
M Blumberg® Style, Side Tab, Letter Size.
$5.46
 
6.00
1186N
N Blumberg® Style, Side Tab, Letter Size.
$5.46
 
6.00
1186P
P Blumberg® Style, Side Tab, Letter Size.
$4.55
 
5.00
1186Q
Q Blumberg® Style, Side Tab, Letter Size.
$5.46
 
6.00
1186R
R Blumberg® Style, Side Tab, Letter Size.
$10.01
 
11.00
1186S
S Blumberg® Style, Side Tab, Letter Size.
$10.01
 
11.00
1186T
T Blumberg® Style, Side Tab, Letter Size.
$4.55
 
5.00
1186U
U Blumberg® Style, Side Tab, Letter Size.
$8.19
 
9.00
1186V
V Blumberg® Style, Side Tab, Letter Size.
$5.46
 
6.00
1186W
W Blumberg® Style, Side Tab, Letter Size.
$2.73
 
3.00
1186X
X Blumberg® Style, Side Tab, Letter Size.
$6.37
 
7.00
1186Y
Y Blumberg® Style, Side Tab, Letter Size.
$10.01
 
11.00
1186Z
Z Blumberg® Style, Side Tab, Letter Size.
$10.01
 
11.00
22BG
Jazz Color Bands, Burgundy
$28.75
 
5.00
22BK
Jazz Color Bands, Black
$88.95
 
18.00
22BN
Jazz Color Bands, Brown
$17.25
 
3.00
22GN
Jazz Color Bands, Green
$59.30
 
13.00
22GY
Jazz Color Bands, Gray
$28.75
 
5.00
22LB
Jazz Color Bands, Light Blue
$53.37
 
9.00
22NB
Jazz Color Bands, Navy Blue
$94.88
 
16.00
22OR
Jazz Color Bands, Orange
$40.25
 
7.00
22PP
Jazz Color Bands, Purple
$59.30
 
13.00
22RD
Jazz Color Bands, Red
$65.23
 
11.00
22WH
Jazz Color Bands, White
$29.65
 
5.00
22YW
Jazz Color Bands, Yellow
$106.74
 
18.00
2301BL
Testament Ledger Blank Envelopes
$319.75
 
20.00
2302BL
Legal Size Testament Ledger Blank Covers
$189.00
 
12.00
2303BL
Letter Size Testament Ledger Blank Covers
$409.50
 
26.00
2303G
Testament Ledger Gold Ink Last Will & Testament Covers, Letter Size
$110.00
 
5.00
2306G
Letter Size Testament Ledger Last Will & Testament Will Kit
$73.80
 
2.00
2311BL
Legal Size Pebble Finish Blank Covers
$93.00
 
6.00
2323C
Wax Seal with Scales of Justice
$28.92
 
1.00
2329B
Will Ribbon, Blue
$54.72
 
3.00
2329R
Will Ribbon, Red
$36.48
 
2.00
2345LWT
Testament Ledger Last Will & Testament Envelopes, Oversized
$17.92
 
2.00
2903BL
Federal Litigation Covers, Blue
$101.70
 
6.00
2903CA
Federal Litigation Covers, Canary
$101.70
 
6.00
2903WH
Federal Litigation Covers, White
$67.80
 
4.00
3086BCN
Certified Mail Labels - USPS approved, with barcode, 100 per package.
$51.27
 
1.00
3097BL
Single Laser/Inkjet Labels, Blank, 300 per package.
$168.00
 
8.00
3098BL
Single Laser/Inkjet Labels, Blank, 300 per package.
$527.00
 
31.00
3098PL
Single Laser/Inkjet Labels, 40 per package.
$100.80
 
5.00
3099BL
Single Laser/Inkjet Labels, Blank, 300 per package.
$100.80
 
5.00
3300BG
Lever Arch Binders, Letter Size, Burgundy
$240.53
 
67.00
3300BK
Lever Arch Binders, Letter Size, Black
$168.73
 
47.00
3300BL
Lever Arch Binders, Letter Size, Blue
$287.20
 
80.00
3300FBG
Lever Arch Binders, Unassembled, Letter Size, Burgundy
$657.00
 
219.00
3300FBK
Lever Arch Binders, Unassembled, Letter Size, Black
$696.00
 
184.00
3300FBL
Lever Arch Binders, Unassembled, Letter Size, Blue
$558.00
 
186.00
 
 
-96-

 
3300FGN
Lever Arch Binders, Unassembled, Letter Size, Green
$153.00
 
51.00
3300FGY
Lever Arch Binders, Unassembled, Letter Size, Gray
$57.00
 
19.00
3300FRD
Lever Arch Binders, Unassembled, Letter Size, Red
$438.00
 
114.00
3300GN
Lever Arch Binders, Letter Size, Green
$258.48
 
72.00
3300GY
Lever Arch Binders, Letter Size, Gray
$35.89
 
10.00
3300L
Lever Arch Binder Labels
$15.76
 
3.00
3300RD
Lever Arch Binders, Letter Size, Red
$409.26
 
114.00
3311BK
Blumberg Cargo™ Slant D 3-Ring Binder for large quantity 3-ring records
$141.80
 
20.00
3333BK
Clear Front Covers, 2" Capacity, Black
$40.67
 
83.00
3333FG
Clear Front Covers, 2" Capacity, Forest Green
$41.16
 
84.00
3333RB
Clear Front Covers, 2" Capacity, Royal Blue
$46.06
 
94.00
3334BK
Clear Front Covers, 2" Capacity, Top Tab, Black
$26.00
 
96.00
3334FG
Clear Front Covers, 2" Capacity, Top Tab, Forest Green
$39.52
 
76.00
3334RB
Clear Front Covers, 2" Capacity, Top Tab, Royal Blue
$23.40
 
45.00
3400BG
Legal Size Binders 3-Ring, 1" Capacity, Burgundy
$307.40
 
53.00
3400BK
Legal Size Binders 3-Ring, 1" Capacity, Black
$873.18
 
147.00
3400BL
Legal Size Binders 3-Ring, 1" Capacity, Blue
$759.80
 
131.00
3400GN
Legal Size Binders 3-Ring, 1" Capacity, Green
$69.60
 
12.00
3400GY
Legal Size Binders 3-Ring, 1" Capacity, Gray
$150.80
 
26.00
505711P
File/Pleading Backers 8 1/2" x 11 1/4", 11pt., Straight Cut, 2-Hole Punched
$82.50
 
5.00
505711P3
File/Pleading Backers 8 1/2" x 11 1/4", 11pt., 1/3 Cut Tab, 2-Hole Punched
$68.40
 
5.00
505714P
File/Pleading Backers 8 1/2" x 14 1/4", 11pt., Straight Cut, 2-Hole Punched
$16.50
 
1.00
505714P3
File/Pleading Backers 8 1/2" x 14 1/4", 11pt., 1/3 Cut Tab, 2-Hole Punched
$66.56
 
4.00
5069EX11
Index Letter Size Side Tabs
$22.56
 
16.00
5069EX14
Index Legal Size Side Tabs
$7.65
 
3.00
5070AP11
Appendix Letter Size Side Tabs
$11.28
 
8.00
5076D
Declaration Letter Size Bottom Tabs
$39.90
 
15.00
5076PS
Proof of Service Letter Size Bottom Tabs
$25.75
 
11.00
5087W
Trial Note Pad
$49.50
 
10.00
5098TC11
Table of Contents Letter Size, Side Tab
$14.10
 
10.00
5098TC14
Table of Contents, Legal Size Side Tab
$2.55
 
1.00
5102R
Roman Numberals I-X, Letter Size Side Tab
$9.87
 
7.00
5105A
Exhibit A, Blumberg® Style, Bottom Tab, Letter Size
$50.05
 
55.00
5105AA
Exhibit AA, Blumberg® Style, Bottom Tab, Letter Size.
$8.19
 
9.00
5105AZ
Blumberg® Style, Bottom Exhibit Tabs, Letter, Collated A-Z
$11.88
 
11.00
5105B
Exhibit B, Blumberg® Style, Bottom Tab, Letter Size
$27.30
 
30.00
5105BB
Exhibit BB, Blumberg® Style, Bottom Tab, Letter Size.
$9.10
 
10.00
5105C
Exhibit C, Blumberg® Style, Bottom Tab, Letter Size
$21.84
 
24.00
5105CC
Exhibit CC, Blumberg® Style, Bottom Tab, Letter Size.
$15.92
 
12.00
5105D
Exhibit D, Blumberg® Style, Bottom Tab, Letter Size.
$42.77
 
47.00
5105DD
Exhibit DD, Blumberg® Style, Bottom Tab, Letter Size.
$5.46
 
6.00
5105E
Exhibit E, Blumberg® Style, Bottom Tab, Letter Size.
$34.58
 
38.00
5105EE
Exhibit EE, Blumberg® Style, Bottom Tab, Letter Size.
$9.10
 
10.00
5105F
Exhibit F, Blumberg® Style, Bottom Tab, Letter Size.
$34.58
 
38.00
5105FF
Exhibit FF, Blumberg® Style, Bottom Tab, Letter Size.
$9.10
 
10.00
5105G
Exhibit G, Blumberg® Style, Bottom Tab, Letter Size.
$29.12
 
32.00
5105GG
Exhibit GG, Blumberg® Style, Bottom Tab, Letter Size.
$9.10
 
10.00
5105H
Exhibit H, Blumberg® Style, Bottom Tab, Letter Size.
$53.69
 
59.00
5105HH
Exhibit HH, Blumberg® Style, Bottom Tab, Letter Size.
$5.46
 
6.00
5105I
Exhibit I, Blumberg® Style, Bottom Tab, Letter Size.
$33.67
 
37.00
5105II
Exhibit II, Blumberg® Style, Bottom Tab, Letter Size.
$4.55
 
5.00
5105J
Exhibit J, Blumberg® Style, Bottom Tab, Letter Size.
$48.23
 
53.00
5105JJ
Exhibit JJ, Blumberg® Style, Bottom Tab, Letter Size.
$6.05
 
5.00
5105K
Exhibit K, Blumberg® Style, Bottom Tab, Letter Size.
$27.30
 
30.00
5105KK
Exhibit KK, Blumberg® Style, Bottom Tab, Letter Size.
$7.28
 
8.00
5105L
Exhibit L, Blumberg® Style, Bottom Tab, Letter Size.
$48.23
 
53.00
5105LL
Exhibit LL, Blumberg® Style, Bottom Tab, Letter Size.
$3.64
 
4.00
5105M
Exhibit M, Blumberg® Style, Bottom Tab, Letter Size.
$35.49
 
39.00
5105MM
Exhibit MM, Blumberg® Style, Bottom Tab, Letter Size.
$5.14
 
4.00
5105N
Exhibit N, Blumberg® Style, Bottom Tab, Letter Size.
$31.85
 
35.00
5105NN
Exhibit NN, Blumberg® Style, Bottom Tab, Letter Size.
$4.23
 
3.00
5105O
Exhibit O, Blumberg® Style, Bottom Tab, Letter Size.
$31.85
 
35.00
5105OO
Exhibit OO, Blumberg® Style, Bottom Tab, Letter Size.
$4.23
 
3.00
 
 
-97-

 
5105P
Exhibit P, Blumberg® Style, Bottom Tab, Letter Size.
$16.38
 
18.00
5105PP
Exhibit PP, Blumberg® Style, Bottom Tab, Letter Size.
$4.23
 
3.00
5105Q
Exhibit Q, Blumberg® Style, Bottom Tab, Letter Size.
$27.30
 
30.00
5105QQ
Exhibit QQ, Blumberg® Style, Bottom Tab, Letter Size.
$2.82
 
2.00
5105R
Exhibit R, Blumberg® Style, Bottom Tab, Letter Size.
$27.30
 
30.00
5105RR
Exhibit RR, Blumberg® Style, Bottom Tab, Letter Size.
$2.82
 
2.00
5105S
Exhibit S, Blumberg® Style, Bottom Tab, Letter Size.
$22.75
 
25.00
5105SS
Exhibit SS, Blumberg® Style, Bottom Tab, Letter Size.
$3.73
 
3.00
5105T
Exhibit T, Blumberg® Style, Bottom Tab, Letter Size.
$18.20
 
20.00
5105TT
Exhibit TT, Blumberg® Style, Bottom Tab, Letter Size.
$3.73
 
3.00
5105U
Exhibit U, Blumberg® Style, Bottom Tab, Letter Size.
$10.01
 
11.00
5105UU
Exhibit UU, Blumberg® Style, Bottom Tab, Letter Size.
$2.82
 
2.00
5105V
Exhibit V, Blumberg® Style, Bottom Tab, Letter Size.
$13.65
 
15.00
5105VV
Exhibit VV, Blumberg® Style, Bottom Tab, Letter Size.
$2.82
 
2.00
5105W
Exhibit W, Blumberg® Style, Bottom Tab, Letter Size.
$7.28
 
8.00
5105WW
Exhibit WW, Blumberg® Style, Bottom Tab, Letter Size.
$3.73
 
3.00
5105X
Exhibit X, Blumberg® Style, Bottom Tab, Letter Size.
$6.37
 
7.00
5105XX
Exhibit XX, Blumberg® Style, Bottom Tab, Letter Size.
$2.82
 
2.00
5105Y
Exhibit Y, Blumberg® Style, Bottom Tab, Letter Size.
$12.74
 
14.00
5105YY
Exhibit YY, Blumberg® Style, Bottom Tab, Letter Size.
$2.82
 
2.00
5105Z
Exhibit Z, Blumberg® Style, Bottom Tab, Letter Size.
$10.92
 
12.00
5105ZZ
Exhibit ZZ, Blumberg® Style, Bottom Tab, Letter Size.
$2.82
 
2.00
5109101T
101-125 Collated, Blumberg® Style, Side Tab, Letter Size.
$20.93
 
23.00
510910N
10, Blumberg® Style, Side Tab, Letter Size.
$24.57
 
27.00
510911N
11, Blumberg® Style, Side Tab, Letter Size.
$10.92
 
12.00
5109126T
126-150 Collated, Blumberg® Style, Side Tab, Letter Size.
$24.57
 
27.00
510912N
12, Blumberg® Style, Side Tab, Letter Size.
$13.65
 
15.00
510913N
13, Blumberg® Style, Side Tab, Letter Size.
$10.01
 
11.00
510914N
14, Blumberg® Style, Side Tab, Letter Size.
$13.65
 
15.00
5109151T
151-175 Collated, Blumberg® Style, Side Tab, Letter Size.
$22.75
 
25.00
510915N
15, Blumberg® Style, Side Tab, Letter Size.
$9.10
 
10.00
510916N
16, Blumberg® Style, Side Tab, Letter Size.
$13.65
 
15.00
5109176T
176-200 Collated, Blumberg® Style, Side Tab, Letter Size.
$16.38
 
18.00
510917N
17, Blumberg® Style, Side Tab, Letter Size.
$12.74
 
14.00
510918N
18, Blumberg® Style, Side Tab, Letter Size.
$5.46
 
6.00
510919N
19, Blumberg® Style, Side Tab, Letter Size.
$11.83
 
13.00
51091N
1, Blumberg® Style, Side Tab, Letter Size.
$29.12
 
32.00
51091T
1-25 Collated, Blumberg® Style, Side Tab, Letter Size.
$17.29
 
19.00
5109201T
201-225 Collated, Blumberg® Style, Side Tab, Letter Size.
$12.74
 
14.00
510920N
20, Blumberg® Style, Side Tab, Letter Size.
$10.92
 
12.00
510921N
21, Blumberg® Style, Side Tab, Letter Size.
$7.28
 
8.00
5109226T
226-250 Collated, Blumberg® Style, Side Tab, Letter Size.
$22.75
 
25.00
510922N
22, Blumberg® Style, Side Tab, Letter Size.
$5.46
 
6.00
510923N
23, Blumberg® Style, Side Tab, Letter Size.
$9.10
 
10.00
510924N
24, Blumberg® Style, Side Tab, Letter Size.
$12.74
 
14.00
5109251T
251-275 Collated, Blumberg® Style, Side Tab, Letter Size.
$2.73
 
3.00
510925N
25, Blumberg® Style, Side Tab, Letter Size.
$8.19
 
9.00
510926N
26, Blumberg® Style, Side Tab, Letter Size.
$11.83
 
13.00
510926T
26-50 Collated, Blumberg® Style, Side Tab, Letter Size.
$20.02
 
22.00
5109276T
276-300 Collated, Blumberg® Style, Side Tab, Letter Size.
$15.47
 
17.00
510927N
27, Blumberg® Style, Side Tab, Letter Size.
$6.37
 
7.00
510928N
28, Blumberg® Style, Side Tab, Letter Size.
$10.92
 
12.00
510929N
29, Blumberg® Style, Side Tab, Letter Size.
$9.10
 
10.00
51092N
2, Blumberg® Style, Side Tab, Letter Size.
$34.58
 
38.00
5109301T
301-325 Collated, Blumberg® Style, Side Tab, Letter Size.
$11.83
 
13.00
510930N
30, Blumberg® Style, Side Tab, Letter Size.
$7.28
 
8.00
510931N
31, Blumberg® Style, Side Tab, Letter Size.
$12.74
 
14.00
5109326T
326-350 Collated, Blumberg® Style, Side Tab, Letter Size.
$10.92
 
12.00
510932N
32, Blumberg® Style, Side Tab, Letter Size.
$10.92
 
12.00
510933N
33, Blumberg® Style, Side Tab, Letter Size.
$7.28
 
8.00
510934N
34, Blumberg® Style, Side Tab, Letter Size.
$8.19
 
9.00
5109351T
351-375 Collated, Blumberg® Style, Side Tab, Letter Size.
$12.74
 
14.00
510935N
35, Blumberg® Style, Side Tab, Letter Size.
$6.37
 
7.00
 
 
-98-

 
510936N
36, Blumberg® Style, Side Tab, Letter Size.
$12.74
 
14.00
5109376T
376-400 Collated, Blumberg® Style, Side Tab, Letter Size.
$5.46
 
6.00
510937N
37, Blumberg® Style, Side Tab, Letter Size.
$12.74
 
14.00
510938N
38, Blumberg® Style, Side Tab, Letter Size.
$5.46
 
6.00
510939N
39, Blumberg® Style, Side Tab, Letter Size.
$10.92
 
12.00
51093N
3, Blumberg® Style, Side Tab, Letter Size.
$19.11
 
21.00
5109401T
401-425 Collated, Blumberg® Style, Side Tab, Letter Size.
$9.10
 
10.00
510940N
40, Blumberg® Style, Side Tab, Letter Size.
$6.37
 
7.00
510941N
41, Blumberg® Style, Side Tab, Letter Size.
$5.46
 
6.00
5109426T
426-450 Collated, Blumberg® Style, Side Tab, Letter Size.
$10.01
 
11.00
510942N
42, Blumberg® Style, Side Tab, Letter Size.
$9.10
 
10.00
510943N
43, Blumberg® Style, Side Tab, Letter Size.
$5.46
 
6.00
510944N
44, Blumberg® Style, Side Tab, Letter Size.
$11.83
 
13.00
5109451T
451-475 Collated, Blumberg® Style, Side Tab, Letter Size.
$9.10
 
10.00
510945N
45, Blumberg® Style, Side Tab, Letter Size.
$10.92
 
12.00
510946N
46, Blumberg® Style, Side Tab, Letter Size.
$7.28
 
8.00
5109476T
476-500 Collated, Blumberg® Style, Side Tab, Letter Size.
$5.46
 
6.00
510947N
47, Blumberg® Style, Side Tab, Letter Size.
$10.92
 
12.00
510948N
48, Blumberg® Style, Side Tab, Letter Size.
$10.01
 
11.00
510949N
49, Blumberg® Style, Side Tab, Letter Size.
$11.83
 
13.00
51094N
4, Blumberg® Style, Side Tab, Letter Size.
$24.57
 
27.00
5109501T
501-525 Collated, Blumberg® Style, Side Tab, Letter Size.
$19.11
 
21.00
510950N
50, Blumberg® Style, Side Tab, Letter Size.
$4.55
 
5.00
510951T
51-75 Collated, Blumberg® Style, Side Tab, Letter Size.
$16.38
 
18.00
5109526T
526-550 Collated, Blumberg® Style, Side Tab, Letter Size.
$19.11
 
21.00
5109551T
551-575 Collated, Blumberg® Style, Side Tab, Letter Size.
$13.65
 
15.00
5109576T
576-600 Collated, Blumberg® Style, Side Tab, Letter Size.
$9.10
 
10.00
51095N
5, Blumberg® Style, Side Tab, Letter Size.
$12.74
 
14.00
5109601T
601-625 Collated, Blumberg® Style, Side Tab, Letter Size.
$8.19
 
9.00
5109626T
626-650 Collated, Blumberg® Style, Side Tab, Letter Size.
$7.28
 
8.00
5109651T
651-675 Collated, Blumberg® Style, Side Tab, Letter Size.
$10.92
 
12.00
5109676T
676-700 Collated, Blumberg® Style, Side Tab, Letter Size.
$7.28
 
8.00
51096N
6, Blumberg® Style, Side Tab, Letter Size.
$21.84
 
24.00
5109701T
701-725 Collated, Blumberg® Style, Side Tab, Letter Size.
$4.55
 
5.00
5109726T
726-750 Collated, Blumberg® Style, Side Tab, Letter Size.
$4.55
 
5.00
5109751T
751-775 Collated, Blumberg® Style, Side Tab, Letter Size.
$6.37
 
7.00
510976T
76-100 Collated, Blumberg® Style, Side Tab, Letter Size.
$11.83
 
13.00
5109776T
776-800 Collated, Blumberg® Style, Side Tab, Letter Size.
$7.28
 
8.00
51097N
7, Blumberg® Style, Side Tab, Letter Size.
$14.56
 
16.00
5109801T
801-825 Collated, Blumberg® Style, Side Tab, Letter Size.
$9.10
 
10.00
5109826T
826-850 Collated, Blumberg® Style, Side Tab, Letter Size.
$9.10
 
10.00
5109851T
851-875 Collated, Blumberg® Style, Side Tab, Letter Size.
$9.10
 
10.00
5109876T
876-900 Collated, Blumberg® Style, Side Tab, Letter Size.
$9.10
 
10.00
51098N
8, Blumberg® Style, Side Tab, Letter Size.
$10.01
 
11.00
5109901T
901-925 Collated, Blumberg® Style, Side Tab, Letter Size.
$9.10
 
10.00
5109926T
926-950 Collated, Blumberg® Style, Side Tab, Letter Size.
$9.10
 
10.00
5109951T
951-975 Collated, Blumberg® Style, Side Tab, Letter Size.
$9.10
 
10.00
5109976T
976-1000 Collated, Blumberg® Style, Side Tab, Letter Size.
$9.10
 
10.00
51099N
9, Blumberg® Style, Side Tab, Letter Size.
$10.92
 
12.00
5126B
Laser Exhibit Labels, Blue
$14.58
 
2.00
5126S
Laser Exhibit Label Starter Kit, Blumberg Brand
$25.17
 
1.00
5126T
Laser Exhibit Label Template, Blumberg Brand
$5.00
 
1.00
5126W
Laser Exhibit Labels, White
$51.03
 
7.00
5126Y
Laser Exhibit Labels, Goldenrod
$51.03
 
7.00
5128A
Exhibit A, Blumberg® Style, Side Tab, Letter Size.
$45.50
 
50.00
5128B
Exhibit B, Blumberg® Style, Side Tab, Letter Size.
$36.40
 
40.00
5128C
Exhibit C, Blumberg® Style, Side Tab, Letter Size.
$11.83
 
13.00
5128D
Exhibit D, Blumberg® Style, Side Tab, Letter Size.
$25.48
 
28.00
5128E
Exhibit E, Blumberg® Style, Side Tab, Letter Size.
$22.75
 
25.00
5128F
Exhibit F, Blumberg® Style, Side Tab, Letter Size.
$18.20
 
20.00
5128G
Exhibit G, Blumberg® Style, Side Tab, Letter Size.
$12.74
 
14.00
5128H
Exhibit H, Blumberg® Style, Side Tab, Letter Size.
$10.92
 
12.00
5128I
Exhibit I, Blumberg® Style, Side Tab, Letter Size.
$5.46
 
6.00
 
 
-99-

 
5128J
Exhibit J, Blumberg® Style, Side Tab, Letter Size.
$11.83
 
13.00
5128K
Exhibit K, Blumberg® Style, Side Tab, Letter Size.
$7.28
 
8.00
5128L
Exhibit L, Blumberg® Style, Side Tab, Letter Size.
$10.92
 
12.00
5128M
Exhibit M, Blumberg® Style, Side Tab, Letter Size.
$5.46
 
6.00
5128N
Exhibit N, Blumberg® Style, Side Tab, Letter Size.
$8.19
 
9.00
5128O
Exhibit O, Blumberg® Style, Side Tab, Letter Size.
$8.19
 
9.00
5128P
Exhibit P, Blumberg® Style, Side Tab, Letter Size.
$7.28
 
8.00
5128Q
Exhibit Q, Blumberg® Style, Side Tab, Letter Size.
$7.28
 
8.00
5128R
Exhibit R, Blumberg® Style, Side Tab, Letter Size.
$6.37
 
7.00
5128S
Exhibit S, Blumberg® Style, Side Tab, Letter Size.
$8.19
 
9.00
5128T
Exhibit T, Blumberg® Style, Side Tab, Letter Size.
$5.46
 
6.00
5128U
Exhibit U, Blumberg® Style, Side Tab, Letter Size.
$11.83
 
13.00
5128V
Exhibit V, Blumberg® Style, Side Tab, Letter Size.
$3.64
 
4.00
5128W
Exhibit W, Blumberg® Style, Side Tab, Letter Size.
$5.46
 
6.00
5128X
Exhibit X, Blumberg® Style, Side Tab, Letter Size.
$3.64
 
4.00
5128Y
Exhibit Y, Blumberg® Style, Side Tab, Letter Size.
$5.46
 
6.00
5128Z
Exhibit Z, Blumberg® Style, Side Tab, Letter Size.
$4.55
 
5.00
5135EX
Letter Size Side Exhibit Blank Writeable Indexes
$72.32
 
64.00
5144ME
Minute Paper Letter Size 28lb., 3-Hole Punched Mottled Edge
$124.80
 
8.00
5145ME
Minute Paper Letter Size 28lb., Rectangular Rod Punched Mottled Edge
$76.01
 
6.00
5147ME
Minute Paper Legal Size 28lb., Rectangular Rod Punched
$171.00
 
10.00
5187BL
Blank Stock Certificate Book, Blue for Corporation
$107.63
 
7.00
5187BLLLC
Blank Stock Certificate Book, Limited Liability Company, Blue Border
$15.37
 
1.00
5187BR
Blank Stock Certificate Book, Corporation, Brown Border
$45.75
 
3.00
5187GR
Blank Stock Certificate Book, Corporation, Green Border
$30.75
 
2.00
5187GRLLC
Blank Stock Certificate Book, Limited Liability Company, Green Border
$15.38
 
1.00
5187GRLP
Blank Stock Certificate Book, Limited Partnership Green Border
$15.25
 
1.00
5187OG
Blank Stock Certificate Book, Corporation, Orange Border
$76.25
 
5.00
597-2
2" Expansion Retention Jackets
$66.09
 
164.00
70CRM
Black Beauty Binder with "Corporate Records"
$60.00
 
5.00
70M
Black Beauty Binder
$24.00
 
2.00
9287ABF
Employee's Personnel File Folder, 20 per package
$34.30
 
10.00
966-BL
Mini Backers, plain
$2,006.05
 
53.00
966-IV
Mini Backers, plain
$3,179.40
 
84.00
966-WH
Mini Backers, plain
$264.95
 
7.00
A234
Certificate of Incorporation, NY
$18.90
 
1.00
A365
Notice of mechanic's lien, affidavit of service, outside NYC, 9-96
$18.90
 
1.00
AVE1186A
A, Avery® Style, Side Tab, Letter Size.
$20.02
 
22.00
AVE1186AAAZZZ
Avery® Style, Side Tabs, Letter, Collated AAA-ZZZ
$22.68
 
21.00
AVE1186AAZZ
Avery® Style, Side Tabs, Letter, Collated AA-ZZ
$27.00
 
25.00
AVE1186AZ
Avery® Style, Side Tabs, Letter, Collated A-Z
$33.48
 
31.00
AVE1186B
B, Avery® Style, Side Tab, Letter Size.
$22.75
 
25.00
AVE1186C
C, Avery® Style, Side Tab, Letter Size.
$7.28
 
8.00
AVE1186D
D, Avery® Style, Side Tab, Letter Size.
$15.47
 
17.00
AVE1186E
E, Avery® Style, Side Tab, Letter Size.
$16.38
 
18.00
AVE1186F
F, Avery® Style, Side Tab, Letter Size.
$66.40
 
16.00
AVE1186G
G, Avery® Style, Side Tab, Letter Size.
$10.92
 
12.00
AVE1186H
H, Avery® Style, Side Tab, Letter Size.
$5.46
 
6.00
AVE1186I
I, Avery® Style, Side Tab, Letter Size.
$7.28
 
8.00
AVE1186J
J, Avery® Style, Side Tab, Letter Size.
$18.20
 
20.00
AVE1186K
K, Avery® Style, Side Tab, Letter Size.
$11.83
 
13.00
AVE1186L
L, Avery® Style, Side Tab, Letter Size.
$10.01
 
11.00
AVE1186M
M, Avery® Style, Side Tab, Letter Size.
$11.83
 
13.00
AVE1186N
N, Avery® Style, Side Tab, Letter Size.
$13.65
 
15.00
AVE1186O
O, Avery® Style, Side Tab, Letter Size.
$15.47
 
17.00
AVE1186P
P, Avery® Style, Side Tab, Letter Size.
$15.47
 
17.00
AVE1186Q
Q, Avery® Style, Side Tab, Letter Size.
$15.47
 
17.00
AVE1186R
R, Avery® Style, Side Tab, Letter Size.
$8.19
 
9.00
AVE1186U
U, Avery® Style, Side Tab, Letter Size.
$0.91
 
1.00
AVE1186V
V, Avery® Style, Side Tab, Letter Size.
$0.91
 
1.00
AVE1186W
W, Avery® Style, Side Tab, Letter Size.
$0.91
 
1.00
AVE1186X
X, Avery® Style, Side Tab, Letter Size.
$0.91
 
1.00
AVE1186Y
Y, Avery® Style, Side Tab, Letter Size.
$0.91
 
1.00
 
 
-100-

 
AVE1186Z
Z, Avery® Style, Side Tab, Letter Size.
$0.91
 
1.00
AVE2186AZ
Avery® Style, Side Exhibit Tabs, Legal, Collated A-Z
$61.56
 
57.00
AVE51051
Exhibit 1, Avery® Style, Bottom Tab, Letter Size.
$6.37
 
7.00
AVE510510
Exhibit 10, Avery® Style, Bottom Tab, Letter Size.
$11.83
 
13.00
AVE510511
Exhibit 11, Avery® Style, Bottom Tab, Letter Size.
$13.65
 
15.00
AVE510512
Exhibit 12, Avery® Style, Bottom Tab, Letter Size.
$13.65
 
15.00
AVE510513
Exhibit 13, Avery® Style, Bottom Tab, Letter Size.
$14.56
 
16.00
AVE510514
Exhibit 14, Avery® Style, Bottom Tab, Letter Size.
$10.01
 
11.00
AVE510515
Exhibit 15, Avery® Style, Bottom Tab, Letter Size.
$7.28
 
8.00
AVE510516
Exhibit 16, Avery® Style, Bottom Tab, Letter Size.
$2.73
 
3.00
AVE510517
Exhibit 17, Avery® Style, Bottom Tab, Letter Size.
$3.64
 
4.00
AVE510518
Exhibit 18, Avery® Style, Bottom Tab, Letter Size.
$2.73
 
3.00
AVE510519
Exhibit 19, Avery® Style, Bottom Tab, Letter Size.
$3.64
 
4.00
AVE510520
Exhibit 20, Avery® Style, Bottom Tab, Letter Size.
$3.64
 
4.00
AVE510521
Exhibit 21, Avery® Style, Bottom Tab, Letter Size.
$3.64
 
4.00
AVE510522
Exhibit 22, Avery® Style, Bottom Tab, Letter Size.
$3.64
 
4.00
AVE510523
Exhibit 23, Avery® Style, Bottom Tab, Letter Size.
$3.64
 
4.00
AVE510524
Exhibit 24, Avery® Style, Bottom Tab, Letter Size.
$3.64
 
4.00
AVE510525
Exhibit 25, Avery® Style, Bottom Tab, Letter Size.
$3.64
 
4.00
AVE510526
Exhibit 26, Avery® Style, Bottom Tab, Letter Size.
$2.73
 
3.00
AVE510527
Exhibit 27, Avery® Style, Bottom Tab, Letter Size.
$3.64
 
4.00
AVE510528
Exhibit 28, Avery® Style, Bottom Tab, Letter Size.
$3.64
 
4.00
AVE510529
Exhibit 29, Avery® Style, Bottom Tab, Letter Size.
$3.64
 
4.00
AVE510530
Exhibit 30, Avery® Style, Bottom Tab, Letter Size.
$3.64
 
4.00
AVE510531
Exhibit 31, Avery® Style, Bottom Tab, Letter Size.
$3.64
 
4.00
AVE510532
Exhibit 32, Avery® Style, Bottom Tab, Letter Size.
$2.73
 
3.00
AVE510533
Exhibit 33, Avery® Style, Bottom Tab, Letter Size.
$2.73
 
3.00
AVE510534
Exhibit 34, Avery® Style, Bottom Tab, Letter Size.
$2.73
 
3.00
AVE510535
Exhibit 35, Avery® Style, Bottom Tab, Letter Size.
$2.73
 
3.00
AVE510536
Exhibit 36, Avery® Style, Bottom Tab, Letter Size.
$2.73
 
3.00
AVE510537
Exhibit 37, Avery® Style, Bottom Tab, Letter Size.
$2.73
 
3.00
AVE510538
Exhibit 38, Avery® Style, Bottom Tab, Letter Size.
$2.73
 
3.00
AVE510539
Exhibit 39, Avery® Style, Bottom Tab, Letter Size.
$2.73
 
3.00
AVE51054
Exhibit 4, Avery® Style, Bottom Tab, Letter Size.
$3.64
 
4.00
AVE510540
Exhibit 40, Avery® Style, Bottom Tab, Letter Size.
$2.73
 
3.00
AVE510541
Exhibit 41, Avery® Style, Bottom Tab, Letter Size.
$3.64
 
4.00
AVE510542
Exhibit 42, Avery® Style, Bottom Tab, Letter Size.
$3.64
 
4.00
AVE510543
Exhibit 43, Avery® Style, Bottom Tab, Letter Size.
$3.64
 
4.00
AVE510544
Exhibit 44, Avery® Style, Bottom Tab, Letter Size.
$3.64
 
4.00
AVE510545
Exhibit 45, Avery® Style, Bottom Tab, Letter Size.
$3.64
 
4.00
AVE510546
Exhibit 46, Avery® Style, Bottom Tab, Letter Size.
$3.64
 
4.00
AVE510547
Exhibit 47, Avery® Style, Bottom Tab, Letter Size.
$3.64
 
4.00
AVE510548
Exhibit 48, Avery® Style, Bottom Tab, Letter Size.
$11.83
 
13.00
AVE510549
Exhibit 49, Avery® Style, Bottom Tab, Letter Size.
$10.92
 
12.00
AVE510550
Exhibit 50, Avery® Style, Bottom Tab, Letter Size.
$2.73
 
3.00
AVE51056
Exhibit 6, Avery® Style, Bottom Tab, Letter Size.
$5.46
 
6.00
AVE51057
Exhibit 7, Avery® Style, Bottom Tab, Letter Size.
$10.01
 
11.00
AVE51058
Exhibit 8, Avery® Style, Bottom Tab, Letter Size.
$10.92
 
12.00
AVE51059
Exhibit 9, Avery® Style, Bottom Tab, Letter Size.
$10.92
 
12.00
AVE5105A
Exhibit A, Avery® Style, Bottom Tab, Letter Size
$34.58
 
38.00
AVE5105AZ
Avery® Style, Bottom Exhibit Tabs, Letter, Collated A-Z
$14.04
 
13.00
AVE5105B
Exhibit B, Avery® Style, Bottom Tab, Letter Size
$27.30
 
38.00
AVE5105C
Exhibit C, Avery® Style, Bottom Tab, Letter Size
$18.20
 
23.00
AVE5105D
Exhibit D, Avery® Style, Bottom Tab, Letter Size
$26.39
 
29.00
AVE5105E
Exhibit E, Avery® Style, Bottom Tab, Letter Size
$22.75
 
25.00
AVE5105F
Exhibit F, Avery® Style, Bottom Tab, Letter Size
$10.01
 
11.00
AVE5105G
Exhibit G, Avery® Style, Bottom Tab, Letter Size
$17.29
 
19.00
AVE5105H
Exhibit H, Avery® Style, Bottom Tab, Letter Size
$5.46
 
6.00
AVE5105I
Exhibit I, Avery® Style, Bottom Tab, Letter Size
$17.29
 
19.00
AVE5105J
Exhibit J, Avery® Style, Bottom Tab, Letter Size
$10.01
 
11.00
AVE5105K
Exhibit K, Avery® Style, Bottom Tab, Letter Size
$20.93
 
23.00
AVE5105L
Exhibit L, Avery® Style, Bottom Tab, Letter Size
$24.57
 
27.00
AVE5105M
Exhibit M, Avery® Style, Bottom Tab, Letter Size
$9.10
 
10.00
 
 
-101-

 
AVE5105N
Exhibit N, Avery® Style, Bottom Tab, Letter Size
$9.34
 
11.00
AVE5105O
Exhibit O, Avery® Style, Bottom Tab, Letter Size
$11.83
 
13.00
AVE5105P
Exhibit P, Avery® Style, Bottom Tab, Letter Size
$4.55
 
5.00
AVE5105Q
Exhibit Q, Avery® Style, Bottom Tab, Letter Size
$3.60
 
4.00
AVE5105R
Exhibit R, Avery® Style, Bottom Tab, Letter Size
$3.60
 
4.00
AVE5105S
Exhibit S, Avery® Style, Bottom Tab, Letter Size
$3.60
 
4.00
AVE5105T
Exhibit T, Avery® Style, Bottom Tab, Letter Size
$4.55
 
5.00
AVE5105U
Exhibit U, Avery® Style, Bottom Tab, Letter Size
$4.55
 
5.00
AVE5105V
Exhibit V, Avery® Style, Bottom Tab, Letter Size
$3.64
 
4.00
AVE5105W
Exhibit W, Avery® Style, Bottom Tab, Letter Size
$0.91
 
1.00
AVE5105X
Exhibit X, Avery® Style, Bottom Tab, Letter Size
$4.55
 
5.00
AVE5105Y
Exhibit Y, Avery® Style, Bottom Tab, Letter Size
$4.55
 
5.00
AVE5105Z
Exhibit Z, Avery® Style, Bottom Tab, Letter Size
$4.55
 
5.00
AVE5109101T
101-125 Collated, Avery® Style, Side Tab, Letter Size.
$18.72
 
18.00
AVE5109126T
126-150 Collated, Avery® Style, Side Tab, Letter Size.
$18.72
 
18.00
AVE5109151T
151-175 Collated, Avery® Style, Side Tab, Letter Size.
$16.64
 
16.00
AVE5109176T
176-200 Collated, Avery® Style, Side Tab, Letter Size.
$14.56
 
14.00
AVE51091T
1-25 Collated, Avery® Style, Side Tab, Letter Size.
$10.40
 
10.00
AVE5109201T
201-225 Collated, Avery® Style, Side Tab, Letter Size.
$14.56
 
14.00
AVE5109226T
226-250 Collated, Avery® Style, Side Tab, Letter Size.
$14.41
 
14.00
AVE5109251T
251-275 Collated, Avery® Style, Side Tab, Letter Size.
$8.19
 
9.00
AVE510926T
26-50 Collated, Avery® Style, Side Tab, Letter Size.
$26.00
 
25.00
AVE5109276T
276-300 Collated, Avery® Style, Side Tab, Letter Size.
$10.01
 
11.00
AVE5109301T
301-325 Collated, Avery® Style, Side Tab, Letter Size.
$8.19
 
9.00
AVE5109326T
326-350 Collated, Avery® Style, Side Tab, Letter Size.
$9.10
 
10.00
AVE5109351T
351-375 Collated, Avery® Style, Side Tab, Letter Size.
$8.19
 
9.00
AVE5109376T
376-400 Collated, Avery® Style, Side Tab, Letter Size.
$9.10
 
10.00
AVE5109401T
401-425 Collated, Avery® Style, Side Tab, Letter Size.
$12.74
 
14.00
AVE5109426T
426-450 Collated, Avery® Style, Side Tab, Letter Size.
$15.47
 
17.00
AVE5109451T
451-475 Collated, Avery® Style, Side Tab, Letter Size.
$15.47
 
17.00
AVE5109476T
476-500 Collated, Avery® Style, Side Tab, Letter Size.
$14.56
 
16.00
AVE510951T
51-75 Collated, Avery® Style, Side Tab, Letter Size.
$15.60
 
15.00
AVE510976T
76-100 Collated, Avery® Style, Side Tab, Letter Size.
$16.64
 
16.00
AVE5128A
Exhibit A, Avery® Style, Side Tab, Letter Size.
$3.64
 
4.00
AVE5128AZ
Avery® Style, Side Exhibit Tabs, Letter, Collated A-Z
$12.96
 
12.00
AVE5128B
Exhibit B, Avery® Style, Side Tab, Letter Size.
$6.37
 
7.00
AVE5128C
Exhibit C, Avery® Style, Side Tab, Letter Size.
$12.74
 
14.00
AVE5128D
Exhibit D, Avery® Style, Side Tab, Letter Size.
$14.56
 
16.00
AVE5128E
Exhibit E, Avery® Style, Side Tab, Letter Size.
$11.83
 
13.00
AVE5128F
Exhibit F, Avery® Style, Side Tab, Letter Size.
$9.10
 
10.00
AVE5128G
Exhibit G, Avery® Style, Side Tab, Letter Size.
$9.10
 
10.00
AVE5128H
Exhibit H, Avery® Style, Side Tab, Letter Size.
$9.10
 
10.00
AVE5128I
Exhibit I, Avery® Style, Side Tab, Letter Size.
$2.73
 
3.00
AVE5128J
Exhibit J, Avery® Style, Side Tab, Letter Size.
$4.55
 
5.00
AVE5128K
Exhibit K, Avery® Style, Side Tab, Letter Size.
$7.28
 
8.00
AVE5128L
Exhibit L, Avery® Style, Side Tab, Letter Size.
$10.01
 
11.00
AVE5128M
Exhibit M, Avery® Style, Side Tab, Letter Size.
$19.11
 
21.00
AVE5128N
Exhibit N, Avery® Style, Side Tab, Letter Size.
$10.01
 
11.00
AVE5128O
Exhibit O, Avery® Style, Side Tab, Letter Size.
$11.83
 
13.00
AVE5128P
Exhibit P, Avery® Style, Side Tab, Letter Size.
$11.83
 
13.00
AVE5128Q
Exhibit Q, Avery® Style, Side Tab, Letter Size.
$12.74
 
14.00
AVE5128R
Exhibit R, Avery® Style, Side Tab, Letter Size.
$12.74
 
14.00
AVE5128S
Exhibit S, Avery® Style, Side Tab, Letter Size.
$12.74
 
14.00
AVE5128T
Exhibit T, Avery® Style, Side Tab, Letter Size.
$12.74
 
14.00
AVE5128U
Exhibit U, Avery® Style, Side Tab, Letter Size.
$5.46
 
6.00
AVE5128V
Exhibit V, Avery® Style, Side Tab, Letter Size.
$5.46
 
6.00
AVE5128W
Exhibit W, Avery® Style, Side Tab, Letter Size.
$5.46
 
6.00
AVE5128X
Exhibit X, Avery® Style, Side Tab, Letter Size.
$5.46
 
6.00
AVE5128Y
Exhibit Y, Avery® Style, Side Tab, Letter Size.
$5.46
 
6.00
AVE5128Z
Exhibit Z, Avery® Style, Side Tab, Letter Size.
$5.46
 
6.00
AVE61091T
1-25 Collated, Avery® Style, Side Tab, Legal Size.
$7.28
 
21.00
AVE610926T
26-50 Collated, Avery® Style, Side Tab, Legal Size.
$15.47
 
17.00
AVE610951T
51-75 Collated, Avery® Style, Side Tab, Legal Size.
$19.11
 
21.00
 
 
-102-

 
AVE610976T
76-100 Collated, Avery® Style, Side Tab, Legal Size.
$23.66
 
26.00
B104
Summons without notice
$17.10
 
1.00
B122
Real Estate Purchase Offer
$17.10
 
1.00
B242
Satisfaction of Judgement Whole or Part
$17.10
 
1.00
B3110DT
Letter Size Project Jacket, Flat
$15.22
 
1.00
B3115DT
Legal Size Project Jacket, Flat
$85.36
 
4.00
B3143DT
Letter Size Project Jacket, 2" Expansion
$47.31
 
3.00
B3145DT
Legal Size Project Jacket, 2" Expansion
$31.40
 
2.00
B399
Request for Judicial Intervention
$17.10
 
1.00
B438
Notice to take Deposition
$17.10
 
1.00
B49BC
Note Size, Columbia Binding Case
$53.20
 
10.00
B50H
Letter Size, Columbia Binding Case
$57.20
 
10.00
B51H
Legal Size, Columbia Binding Case
$101.70
 
18.00
BCOM
Oak Style 10-1/2" Chairman Presentation Set Gavel with Soundblock, Gold Band.
$234.20
 
4.00
BCVBlue
Brief Covers Letter Size Side Scored, Blue
$71.25
 
15.00
BCVGray
Brief Covers Letter Size Side Scored, Gray
$223.25
 
47.00
BCVWhite
Brief Covers Letter Size Side Scored, White
$23.60
 
5.00
BCWJ
American Walnut 11" Judge's Chairman Presentation Set Gavel with Soundblock, Gold Band.
$110.70
 
2.00
BGAJ
11" American Rosewood Judge's Boxed Gavel, Silver Band.
$79.95
 
3.00
BGAL
8" American Rosewood Boxed Gavel, Silver Band.
$17.40
 
1.00
BGAM
10-1/2" American Rosewood Boxed Gavel, Silver Band.
$62.10
 
3.00
BGDLG
8" Gold Finish Boxed Gavel, Gold Band.
$12.75
 
1.00
BGOM
10-1/2" Oak Style Boxed Gavel, Gold Band.
$33.60
 
2.00
BGWJ
11" American Walnut Judge's Boxed Gavel, Gold Band.
$10.28
 
5.00
BGWL
8" American Walnut Boxed Gavel, Gold Band.
$38.10
 
3.00
BGWM
10-1/2" American Walnut Boxed Gavel, Gold Band.
$68.40
 
6.00
BlueU
Blue Unauthorized Security Paper, Letter Size, Text Weight
$51.00
 
6.00
BLUEU2S
Blue Unauthorized Security Paper, Letter Size, Text Weight, 2-Sided
$50.00
 
4.00
BlueV
Blue Void Security Paper, Letter Size, Text Weight
$270.00
 
27.00
BlueV2P
Blue Void 2-Part Carbonless Security Paper
$1,587.50
 
127.00
BlueV65
Security Paper, Letter Size, Cover Stock, Blue VOID
$1,626.88
 
164.00
BlueVPerf
Blue Void Security Paper, Letter Size, Quarter Perfed
$451.00
 
41.00
BlueVTab
Blue Void 11 x 17 Text Weight Stock Security Paper
$737.50
 
59.00
BlueVTab65
Blue Void 11 x 17 65# Cover Stock Security Paper
$587.50
 
47.00
BSBA
American Rosewood 4" Square Sound Block
$37.35
 
3.00
BSBO
Oak Style 4" Square Sound Block
$135.30
 
11.00
BSBW
American Walnut 4" Round Sound Block
$49.80
 
4.00
CBWHLS
Capital Bond Legal Scale Watermarked Paper
$248.20
 
17.00
CBWHWV
Capital Bond White Wove, 24lb. 8.5" x 11"
$162.42
 
13.00
CBWHWV#10
Capital Bond White Wove, 24lb. #10 Envelopes
$156.94
 
7.00
CCCNW
Classic Crest Natural White 110# Cover
$172.04
 
34.00
CCCWH
Classic Crest White 110# Cover
$96.14
 
19.00
CLAVLN
Classic Linen Writing Letter Size Blank Second Sheets, Avon Brilliant White
$286.43
 
18.00
CLAVLN#10
Classic Linen Writing Blank #10 Envelopes Second Sheets, Avon Brilliant White
$266.32
 
8.00
CLBILD
Classic Laid Writing Letter Size Blank Second Sheets, Baronial Ivory
$143.22
 
9.00
CLBILD#10
Classic Laid Writing Blank #10 Envelopes Second Sheets, Baronial Ivory
$199.74
 
6.00
CLBILN
Classic Linen Writing Letter Size Blank Second Sheets, Baronial Ivory
$238.68
 
15.00
CLBILN#10
Classic Linen Writing Blank #10 Envelopes, Baronial Ivory
$133.16
 
4.00
CLGRLN#10
Classic Linen Writing Blank #10 Envelopes Second Sheets, Antique Gray
$66.58
 
2.00
CLNWLD
Classic Laid Writing Letter Size Blank Second Sheets, Natural White
$15.91
 
1.00
CLNWLN
Classic Linen Writing Letter Size Blank Second Sheets. Natural White
$143.21
 
9.00
CRFWLD
Crane's Crest Writing Letter Size Blank Second Sheets, Flourescent White Laid
$298.90
 
10.00
CRFWLD#10
Crane's Crest & Bond Blank #10 Envelopes, Flourescent White Laid
$207.10
 
5.00
CRFWWV
Crane's Crest Writing Letter Size Blank Second Sheets, Flourescent White Wove
$418.46
 
14.00
CRFWWV#10
Crane's Crest & Bond Blank #10 Envelopes, Flourescent White Wove
$218.45
 
5.00
CRIVWV
Crane's Bond Writing Letter Size Blank Second Sheets, Ivory Wove
$29.89
 
1.00
CRIVWV#10
Crane's Bond Blank #10 Envelopes, Ivory Wove
$103.55
 
3.00
CRNWLD
Crane's Crest Writing Letter Size Blank Second Sheets, Natural White Laid
$179.34
 
6.00
CRNWLD#10
Crane's Crest Blank #10 Envelopes, Natural White Laid
$91.98
 
2.00
CRNWWV
Crane's Crest Writing Letter Size Blank Second Sheets, Natural White Wove
$269.01
 
9.00
CRNWWV#10
Crane's Crest Blank #10 Envelopes, Natural White Wove
$282.90
 
10.00
DeterX
Gray Copy, Letter Size
$1,498.00
 
107.00
DSA
Director Set, American Rosewood Style, Silver Band
$143.00
 
4.00
 
 
-103-

 
DSO
Director Set, Oak Style, Gold Band.
$218.05
 
7.00
DSW
Director Set, Walnut Style, Gold Band.
$166.95
 
7.00
ENC201
Embossed Thank You Cards, 10 Per Package with envelopes
$41.40
 
12.00
ENC204
We Appreciate Your Business Cards, 10 Per Package with envelopes
$24.15
 
7.00
G30
Miniature Barrel Gavel
$25.00
 
10.00
G3N
Miniature Gavel
$52.80
 
22.00
G5WPEN
Miniature Gavel Pen
$103.60
 
37.00
GBWHWV
Gilbert® Bond Light Cockle Finish. 24lb., 25% Cotton Content, 8.5" x 11".
$202.40
 
11.00
GBWHWV#10
Gilbert® Bond Blank #10 Envelopes
$156.00
 
4.00
GBWHWV20
Gilbert® Bond Light Cockle Finish. 20lb., 25% Cotton Content, 8.5" x 11".
$165.60
 
9.00
GBWHWV20#10
Gilbert® Bond Blank #10 Envelopes, 20#
$195.00
 
5.00
GC150
Goes® Oklahoma Stock Certificates
$40.55
 
4.00
GC156
Goes® Virginia Stock Certificates
$40.55
 
4.00
GC174
Goes® Common Blank Stock Certificates
$50.68
 
5.00
GC178
Goes® Preferred Stock Certificates
$37.62
 
4.00
GC193-1/2
Goes® Louisiana Stock Certificates
$50.69
 
5.00
GC199
Goes® Kansas Stock Certificates
$40.55
 
4.00
GC213
Goes® Missouri Stock Certificates
$40.55
 
4.00
GC220
Goes® South Carolina Stock Certificates
$50.69
 
5.00
GC223
Goes® North Carolina Stock Certificates
$30.41
 
3.00
GC265
Goes® Texas Stock Certificates
$119.03
 
10.00
GC385
Goes® Pennsylvania Stock Certificates
$40.55
 
4.00
GC390
Goes® No Par Value Stock Certificates
$28.21
 
3.00
GC510
Goes® Blank Corporation Stock Certificates
$109.76
 
8.00
GC514
Goes® Ohio Stock Certificates
$87.42
 
6.00
GC90
Goes® Colorado Stock Certificates
$65.38
 
5.00
GCM113
Goes® Massachusetts Stock Certificates
$32.42
 
3.00
GK1
Miniature Gavel Key Chain
$93.60
 
39.00
GK30
Miniature Barrel Gavel Keychain
$56.00
 
20.00
GrayC
Gray Copy Security Paper, Letter Size, Text Weight
$1,110.00
 
111.00
IB20LCLEGALRED
Legal Size, 20lb. Cotton Bond, Red Ruled Paper
$138.11
 
7.00
IB20LCNBR
Letter Size, 20lb. Cotton Bond, Black Ruled Paper, Numbered 1-28
$193.41
 
7.00
IB20LCRED
Letter Size, 20lb. Cotton Bond, Red Ruled Paper
$55.14
 
6.00
IB24LCBLK
Letter Size, 24lb. Cotton Bond, Standard Ruled Paper
$25.48
 
28.00
IB24LCBLU
Letter Size, 24lb. Cotton Bond, Standard Ruled Paper
$15.47
 
17.00
IB24LCNYBLU
Letter Size, 24lb. Cotton Bond, New York Ruled Paper
$153.00
 
9.00
IB24LCNYRED
Letter Size, 24lb. Cotton Bond, New York Ruled Paper
$61.22
 
7.00
IB24LCRED
Letter Size, 24lb. Cotton Bond, Standard Ruled Paper
$27.57
 
3.00
IILBLK
Ideal Ink Refills 2oz Large, Black
$12.54
 
6.00
IILBLUE
Ideal Ink Refills 2oz Large, Blue
$8.36
 
4.00
IILGRN
Ideal Ink Refills 2oz Large, Green
$6.27
 
3.00
IILRED
Ideal Ink Refills 2oz Large, Red
$6.27
 
3.00
IILVIO
Ideal Ink Refills 2oz Large, Violet
$4.18
 
2.00
IISBLK
Ideal Ink Refills 6cc Small
$2.64
 
2.00
IISBLUE
Ideal Ink Refills 6cc Small
$2.64
 
2.00
IISGRN
Ideal Ink Refills 6cc Small
$6.60
 
5.00
IISRED
Ideal Ink Refills 6cc Small
$2.64
 
2.00
IISVIO
Ideal Ink Refills 6cc Small
$3.96
 
3.00
L821
Affidavit of Service
$12.00
 
4.00
L850
Real Estate File Folder, Legal Size
$30.87
 
9.00
L900BL
NYS Litigation Cover, Blue
$755.75
 
207.00
L900FBL9
New York State Litigation Covers, Blue, standard 9" width
$10.95
 
3.00
L900FGY8.5
New York State Litigation Covers, Gray, 8.5" width for laser printer
$18.25
 
5.00
L900FGY9
New York State Litigation Covers, Gray, standard 9" width
$62.05
 
17.00
L900FIV8.5
New York State Litigation Covers, Ivory, 8.5" width for laser printer
$25.55
 
7.00
L900FIV9
New York State Litigation Covers, Ivory, standard 9" width
$32.85
 
9.00
L900FWH8.5
New York State Litigation Covers, White, 8.5" width for laser printer
$11.55
 
3.00
L900FWH9
New York State Litigation Covers, White, standard 9" width
$25.55
 
7.00
L900GR
NYS Litigation Cover, Gray
$155.82
 
49.00
L900IV
NYS Litigation Cover, Ivory
$213.06
 
67.00
L900WH
NYS Litigation Covers, White
$146.28
 
46.00
LWTLEG
Last Will and Testament First Sheets, Legal Size
$44.80
 
5.00
M183
Will, long form, folds to 8 1/2 x l4, 4-79
$8.96
 
1.00
 
 
-104-

 
MCVS1LG9
Manuscript Covers, Legal Size, Blue, 9" Width
$91.85
 
9.00
MCVS1LT9
Manuscript Covers, Letter Size, Blue, 9" Width
$130.76
 
14.00
MCVS2LG8.5
Manuscript Covers, Legal Size, Canary, 8.5" Width
$28.02
 
3.00
MCVS2LG9
Manuscript Covers, Legal Size, Canary, 9" Width
$275.54
 
27.00
MCVS2LT8.5
Manuscript Covers, Letter Size. Canary, 8.5" Width for Laser Printer
$9.34
 
1.00
MCVS2LT9
Manuscript Covers, Letter Size, Canary, 9" Width
$94.30
 
10.00
MCVS3LT8.5
Manuscript Covers, Letter Size, Ivory, 8.5" Width for Laser Printer
$9.43
 
1.00
MCVS3LT9
Manuscript Covers, Letter Size, Ivory, 9" Width
$197.16
 
62.00
MCVS4LT8.5
Manuscript Covers, Letter Size, Gray, 8.5" Width for Laser Printer
$9.34
 
1.00
MCVS4LT9
Manuscript Covers, Letter Size, Gray, 9" Width
$111.32
 
31.00
MCVS5LT9
Manuscript Covers, Letter Size, White, 9" Width
$189.66
 
58.00
MCVS6LT9
Manuscript Covers, Letter Size, Red, 9" Width
$65.38
 
7.00
Misc.
 
$2,630.80
 
6,928.00
P1624
Satisfaction of mortgage, ind., corp, 1-side record, 11-98
$20.40
 
1.00
P1693
Quitclaim deed, ind. corp, 11-98
$20.40
 
1.00
P182
Will short form, 8 1/2 x 13 1/2, 100% Rag content, 4-79
$20.40
 
1.00
P3130
Power of attorney, durable or springing, with affidavit, 9-94
$20.40
 
1.00
P490
Attorney's letter of engagement, 22 NYCRR 1215, 3-02
$20.40
 
1.00
P644
Power of attorney, statutory form, disability Clause, 01-09
$20.40
 
1.00
P670
Mortgage, short form, plain English 11-98
$20.40
 
1.00
PNC101
Thank You Note Cards, 20 Per Package with envelopes
$46.56
 
24.00
PO24
Opaque, 60# Text Paper, 8.5x11, White
$9.88
 
2.00
RCNWWV
Royal Cotton, Letter Size, 24lb., Natural White Wove
$68.25
 
7.00
RCWHLEG
Legal Size Royal Cotton, Blank Paper
$146.17
 
28.00
RCWHLEG20
Legal Size Royal Cotton 20# White Bond
$260.16
 
12.00
RCWHWV
Royal Cotton, Letter Size, 24lb., White Wove
$126.75
 
13.00
RCWHWV20
Royal Cotton White Wove, 20lb. 8.5" x 11"
$59.38
 
7.00
RedU65
Security Paper, Letter Size, Cover Stock, Red Unauthorized
$486.08
 
49.00
SCRIPTX
Blue Void Rx, Letter Size
$28.00
 
1,007.00
STAND2
2 Compartment Display Stand for pamphlets.
$7.46
 
1.00
STAND4
4 Compartment Display Stand for pamphlets.
$15.56
 
1.00
SWBWLD
Strathmore Writing Letter Size Blank Second Sheets, Bright White Laid
$79.56
 
5.00
SWBWLD#10
Strathmore Writing Laid Blank #10 Envelopes, Bright White
$166.45
 
5.00
SWBWWV
Strathmore Writing Letter Size Blank Second Sheets, Bright White Wove
$63.65
 
4.00
SWBWWV#10
Strathmore Writing Wove Blank #10 Envelopes, Bright White
$66.58
 
2.00
SWIVLD
Strathmore Writing Letter Size Blank Second Sheets, Ivory Laid
$149.20
 
9.00
SWIVWV
Strathmore Writing Letter Size Blank Second Sheets, Ivory Wove
$127.32
 
8.00
SWNWLD
Strathmore Writing Letter Size Blank Second Sheets, Natural White Laid
$47.74
 
3.00
SWNWLD#10
Strathmore Writing Laid Blank #10 Envelopes, Natural White
$199.74
 
6.00
SWNWWV
Strathmore Writing Letter Size Blank Second Sheets, Natural White Wove
$95.51
 
6.00
SWNWWV#10
Strathmore Writing Wove Blank #10 Envelopes, Natural White
$278.24
 
8.00
SWUWLD
Strathmore Writing Letter Size Blank Second Sheets, Ultimate White Laid
$79.56
 
5.00
SWUWWV
Strathmore Writing Letter Size Blank Second Sheets, Ultimate White Wove
$176.80
 
10.00
SWUWWV#10
Strathmore Writing Wove Blank #10 Envelopes, Ultimate Wove
$185.40
 
5.00
T1165
Uniform transcript of judg., Blank Ct., 5-99
$18.90
 
1.00
T327
Apartment lease, stabilization, plain English format, 12-87
$18.90
 
1.00
T339
Certificate of use of assumed name by corporation, 9-98
$37.80
 
2.00
T354
Legal Form
$20.40
 
1.00
T368
Stipulation cancelling lis pendens, attorney affirmation, CPLR 6514 (d), 7-96
$18.90
 
1.00
T419
Affirmation, order to show cause, contempt, non-com- pliance with information subpoena, Blank Ct., 11-77
$18.90
 
1.00
T429
Subpoena duces tecum, deposition of judgment debtor restraining notice, Blank Ct., 1-95
$18.90
 
1.00
T439
Income execution, CPLR 5231, Blank Ct., 9-97
$18.90
 
1.00
T456
Notice of no necessity, matrimonial action, 12-93
$18.90
 
1.00
T487
Option for purchase of real estate, plain English, 5-80
$18.90
 
1.00
T510
Original petition, any ground, sum. proc., Blank Ct., 1-95
$18.90
 
1.00
T523
Judgement of Eviction Nonpayment
$18.90
 
1.00
T530
Judgement Eviction Holdover After Trial
$18.90
 
1.00
T639
Certificate of Ammendment DBA Corporation
$18.90
 
1.00
T88
Hud
$18.90
 
1.00
UCC1
Financing Statement - NS
$21.25
 
125.00
UCC11
Request for Search - NS
$24.99
 
147.00
UCC1AD
Financing Statement Addendum
$14.79
 
87.00
UCC3
Statement of Change, NS
$5.44
 
32.00
 
 
-105-

 
UCC3AD
Financing Statement of Amed. Adedendum
$23.46
 
138.00
W451
Legal Forms
$20.40
 
1.00
WCL3
Client Ledger 11" x 11"
$58.50
 
5.00
WCL3S
Client Ledger, 8-1/2" x 11"
$41.10
 
5.00
WCL4
Client Ledger, 8-1/2" x 14"
$50.40
 
3.00
WCTS4
Time Control System
$598.80
 
20.00
WJCRF3
Cash Receipts Journal, 11" x 17"
$55.80
 
3.00
WJCRF325
Cash Receipts Journal
$42.60
 
2.00
WJDGA3
General Disbursement Journal, 11" x 17"
$31.80
 
2.00
WJDGA325
General Disbursement Journal, 11" x 24-5/8"
$94.80
 
5.00
WJDGA4
General Disbursement Journal 11" x 23-3/8"
$37.92
 
2.00
WJDTA3
Trust Disbursement Journal, 11" x 17"
$32.88
 
2.00
WJDTA4
Trust Disbursement Journal, 11" x 17"
$32.64
 
2.00
WNMS534
New Matter Indexes, 4-Part
$82.56
 
4.00
WNMS6
New Matter Indexes, 6-Part
$162.96
 
7.00
WS10RBLK
Security #10 White Wove Standard Business Envelope, Black Tint
$41.75
 
5.00
WS10RBLU
Security #10 White Wove Standard Business Envelope, Blue Tint
$25.05
 
3.00
WS10WBLK
Security #10 White Wove Window Business Envelope, Black Tint
$31.58
 
3.00
WSGCE2093
Double Window Envelopes
$93.00
 
5.00
WW10R
White Wove #10 Envelopes
$81.80
 
11.00
WW10W
White Wove #10 Window Envelopes
$114.87
 
13.00
WW9R
White Wove #9 Envelopes
$22.29
 
3.00
WW9W
White Wove #9 Return Window Envelopes
$31.05
 
5.00
X1319
Judgement Default, Blank City
$18.90
 
1.00
X211
Original Notice of Petition
$18.90
 
1.00
X417
Legal Form
$20.40
 
1.00
X444
Original pet. non-payment, sum. proc., Blank Ct., 1-95
$18.90
 
1.00
X445
Original notice of pet. non-payment, sum. proc., Blank Ct., 1-95
$18.90
 
1.00
X446
Copy of Petition & Notice of Non Payment
$18.90
 
1.00
X505711
File/Pleading Backers with Prong Fasteners, 8 1/2" x 11 1/4", 14pt.
$150.34
 
4.00
X5057113
File/Pleading Backers with Prong Fasteners, 8 1/2" x 11 1/4", 14pt., 1/3 Cut Tab
$315.00
 
7.00
X505711P
File/Pleading Backers 8 1/2" x 11 1/4", 14pt., Straight Cut, 2-Hole Punched
$68.25
 
5.00
X505711P3
File/Pleading Backers 8 1/2" x 11 1/4", 14pt., 1/3 Cut Tab, 2-Hole Punched
$108.00
 
3.00
X505714
File/Pleading Backers with Prong Fasteners, 8 1/2" x 14 1/4", 14pt.
$62.64
 
3.00
X5057143
File/Pleading Backers with Prong Fasteners, 8 1/2" x 14 1/4", 14pt., 1/3 Cut Tab
$323.30
 
10.00
X505714P
File/Pleading Backers 8 1/2" x 14 1/4", 14pt., Straight Cut, 2-Hole Punched
$32.70
 
2.00
X505714P3
File/Pleading Backers 8 1/2" x 14 1/4", 14pt., 1/3 Cut Tab, 2-Hole Punched
$65.64
 
3.00
X74
Conducting Business as Partners
$18.90
 
1.00
XS07515
Xstamper Small Stamp Tray
$5.94
 
3.00
XS1001
Stock Stamp Air Mail
$4.75
 
1.00
XS1002
Stock Stamp SAMPLE
$9.50
 
2.00
XS1004
Stock Stamp RUSH
$9.50
 
2.00
XS1005
Stock Stamp PAID
$9.50
 
2.00
XS1006
Stock Stamp COPY
$14.25
 
3.00
XS1007
Stock Stamp IMPORTANT
$9.50
 
2.00
XS1008
Stock Stamp Approved
$9.50
 
2.00
XS1010
Stock Stamp FRAGILE
$9.50
 
2.00
XS1011
Stock Stamp C.O.D.
$9.50
 
2.00
XS1012
Stock Stamp SECOND NOTICE
$9.50
 
2.00
XS1014
Stock Stamp FINAL NOTICE
$14.25
 
3.00
XS1019
Stock Stamp CREDIT
$9.50
 
2.00
XS1020
Stock Stamp PERSONAL
$9.50
 
2.00
XS1021
Stock Stamp ENTERED
$9.50
 
2.00
XS1022
Stock Stamp CONFIRMATION
$9.50
 
2.00
XS1025
Stock Stamp APPROVED for PAYMENT
$4.75
 
1.00
XS1026
Stock Stamp COMPLETED
$9.50
 
2.00
XS1033
Stock Stamp PRIORITY
$9.50
 
2.00
XS1034
Stock Stamp EXPEDITE
$9.50
 
2.00
XS1042
Stock Stamp UNCLASSIFIED
$9.50
 
2.00
XS1047
Stock Stamp POSTED
$9.50
 
2.00
XS1051
Stock Stamp FILE
$4.75
 
1.00
XS1053
Stock Stamp INVOICE
$9.50
 
2.00
XS1068
Stock Stamp DRAFT
$9.50
 
2.00
 
 
-106-

 
XS1069
Stock Stamp COPY for your INFORMATION
$4.75
 
1.00
XS1071
Stock Stamp FILE COPY
$23.75
 
5.00
XS1103
Stock Stamp URGENT
$14.25
 
3.00
XS1107
Stock Stamp PARCEL POST
$9.50
 
2.00
XS1111
Stock Stamp ORIGINAL
$19.00
 
4.00
XS1112
Stock Stamp DUPLICATE
$4.75
 
1.00
XS1116
Stock Stamp RECEIVED
$4.75
 
1.00
XS1117
Stock Stamp VOID
$14.25
 
3.00
XS1119
Stock Stamp CANCELLED
$9.50
 
2.00
XS1121
Stock Stamp FOR DEPOSIT ONLY
$9.50
 
2.00
XS1127
Stock Stamp PAST DUE
$4.75
 
1.00
XS1130
Stock Stamp CONFIDENTIAL
$14.25
 
3.00
XS11357
Stock Stamp Round OK
$8.50
 
2.00
XS11359
Round Stock Stamp THANK YOU
$8.50
 
2.00
XS11363
http://shopping.netsuite.com/s.nl?c=562489
$12.75
 
3.00
XS1138
Stock Stamp Client's Copy
$28.50
 
6.00
XS11407
Copy Round Stock Stamp
$8.50
 
2.00
XS11408
Round Stock Stamp DRAFT
$8.50
 
2.00
XS11409
Round Stock Stamp FAXED
$8.50
 
2.00
XS11411
Round Stock Stamp FILE COPY
$17.00
 
4.00
XS11413
Round Stock Stamp FYI
$12.75
 
3.00
XS11414
Round Stock Stamp INITIAL
$12.75
 
3.00
XS11415
Round Stock Stamp PAID
$12.75
 
3.00
XS11418
Round Stock Stamp ENTERED
$8.50
 
2.00
XS1150
Stock Stamp CONFIDENTIAL
$4.75
 
1.00
XS1201
Stock Stamp PAID
$9.50
 
2.00
XS1203
Stock Stamp RECEIVED
$4.75
 
1.00
XS1205
Stock Stamp ENTERED
$9.50
 
2.00
XS1207
Stock Stamp VOID
$9.50
 
2.00
XS1208
Stock Stamp BILLED
$4.75
 
1.00
XS1211
Stock Stamp POSTED
$9.50
 
2.00
XS1214
Stock Stamp COMPLETED
$9.50
 
2.00
XS1215
Stock Stamp DISTRIBUTED
$9.50
 
2.00
XS1216
Stock Stamp FAXED
$9.50
 
2.00
XS1217
Stock Stamp FILE
$9.50
 
2.00
XS1218
Stock Stamp MAILED
$9.50
 
2.00
XS1219
Stock Stamp REVISED
$9.50
 
2.00
XS1221
Stock Stamp PAID
$9.50
 
2.00
XS1223
Stock Stamp RECEIVED
$9.50
 
2.00
XS1332
Stock Stamp FIRST CLASS
$9.50
 
2.00
XS1333
Stock Stamp FOR DEPOSIT ONLY
$9.50
 
2.00
XS1334
Stock Stamp RUSH
$9.50
 
2.00
XS1335
Stock Stamp PAID
$9.50
 
2.00
XS1337
Stock Stamp COURT COPY
$33.25
 
7.00
XS1338
Stock Stamp OFFICE COPY
$9.50
 
2.00
XS1344
Stock Stamp ACCOUNT NOW OVERDUE
$4.75
 
1.00
XS1350
Stock Stamp FAXED
$4.75
 
1.00
XS1359
Stock Stamp COPY
$4.75
 
1.00
XS1360
Stock Stamp DRAFT
$9.50
 
2.00
XS1361
Stock Stamp FYI
$9.50
 
2.00
XS1362
Stock Stamp PAST DUE
$9.50
 
2.00
XS1364
Stock Stamp RECYCLE
$9.50
 
2.00
XS1365
Stock Stamp SHRED
$9.50
 
2.00
XS1504
Stock Stamp RETURN RECEIPT REQUESTED
$9.50
 
2.00
XS1512
Stock Stamp FIRST CLASS
$9.50
 
2.00
XS1537
Stock Stamp DO NOT BEND
$14.25
 
3.00
XS1571
Stock Stamp DO NOT XRAY
$4.75
 
1.00
XS1650
Stock Stamp E-MAILED
$9.50
 
2.00
XS1651
Stock Stamp E-MAIL
$4.75
 
1.00
XS1814
Stock Stamp Attorney's Copy
$19.00
 
4.00
XS1815
Stock Stamp Judge's Copy
$23.75
 
5.00
XS1816
Stock Stamp Attorney-Client Privilege
$28.50
 
6.00
XS1817
Stock Stamp COPY
$9.50
 
2.00
 
XS1822
Stock Stamp ENTERED ON/BY
$4.75
 
1.00
XS1826
Stock Stamp SIGNED/DATE
$9.50
 
2.00
XS1829
Stock Stamp SCANNED
$9.50
 
2.00
XS1830
Stock Stamp COURTESY COPY, ORIGINAL FILE ELECTRONICALLY
$9.50
 
2.00
XS1831
Stock Stamp PRIVILEGED
$9.50
 
2.00
XS2015
Two-Color Stock Stamp PAST DUE PLEASE REMIT
$10.50
 
2.00
XS2022
Two-Color Stock Stamp COPY
$10.50
 
2.00
XS2023
Two-Color Stock Stamp FAXED
$10.50
 
2.00
XS2024
Two-Color Stock Stamp PAID
$5.25
 
1.00
XS2025
Two-Color Stock Stamp EMAILED
$5.25
 
1.00
XS2026
Two-Color Stock Stamp COMPLETED
$5.25
 
1.00
XS2027
Two-Color Stock Stamp ENTERED
$5.25
 
1.00
XS2028
Two-Color Stock Stamp FILE
$10.50
 
2.00
XS2029
Two-Color Stock Stamp PERSONAL CONFIDENTIAL
$5.25
 
1.00
XS2030
Two-Color Stock Stamp RECEIVED
$5.25
 
1.00
XS2031
Two-Color Stock Stamp DRAFT
$5.25
 
1.00
XS2032
Two-Color Stock Stamp FILE COPY
$5.25
 
1.00
XS2033
Two-Color Stock Stamp ROUGH DRAFT
$5.25
 
1.00
XS2034
Two-Color Stock Stamp CONFIDENTIAL
$5.25
 
1.00
XS2035
Two-Color Stock Stamp FOR DEPOSIT ONLY
$10.50
 
2.00
XS2037
Two-Color Stock Stamp VOID
$5.25
 
1.00
XS2038
Two-Color Stock Stamp POSTED
$5.25
 
1.00
XS2039
Two-Color Stock Stamp ORIGINAL
$10.50
 
2.00
XS2040
Two-Color Stock Stamp RUSH
$10.50
 
2.00
XS2049
Two-Color Stock Stamp PAST DUE PLEASE REMIT
$5.25
 
1.00
XS22111
Xstamper Ink Refills 10ml, Red
$12.40
 
5.00
XS22112
Xstamper Ink Refills 10ml, Black
$7.44
 
3.00
XS22113
Xstamper Ink Refills 10ml, Blue
$4.96
 
2.00
XS22114
Xstamper Ink Refills 10ml, Green
$2.48
 
1.00
XS22115
Xstamper Ink Refills 10ml, Purple
$4.96
 
2.00
XS22116
Xstamper Ink Refills 10ml, Orange
$2.48
 
1.00
XS22211
Xstamper Ink Refills 20ml, Red
$11.94
 
3.00
XS22212
Xstamper Ink Refills 20ml, Black
$7.96
 
2.00
XS22213
Xstamper Ink Refills 20ml, Blue
$7.96
 
2.00
XS22214
Xstamper Ink Refills 20ml, Green
$7.96
 
2.00
XS22216
Xstamper Ink Refills 20ml, Orange
$3.98
 
1.00
XS34000
Xstamper Spin N' Stamp Holder
$12.75
 
3.00
XS34328
Spin N' Stamp Cartridge Completed
$2.99
 
1.00
XS34329
Spin N' Stamp Cartridge File
$2.99
 
1.00
XS34330
Spin N' Stamp Cartridge File Copy
$5.97
 
2.00
XS34331
Spin N' Stamp Cartridge Urgent
$2.99
 
1.00
XS34332
Spin N' Stamp Cartridge Original
$2.99
 
1.00
XS34333
Spin N' Stamp Cartridge Void
$5.97
 
2.00
XS34334
Spin N' Stamp Cartridge Confidential
$5.97
 
2.00
XS34335
Spin N' Stamp Cartridge Entered
$2.99
 
1.00
XS34336
Spin N' Stamp Cartridge Paid
$2.99
 
1.00
XS34337
Spin N' Stamp Cartridge Received
$2.99
 
1.00
XS34338
Spin N' Stamp Cartridge First Class
$2.99
 
1.00
XS34339
Spin N' Stamp Cartridge Rush
$2.99
 
1.00
XS34340
Spin N' Stamp Cartridge Faxed
$2.99
 
1.00
XS34341
Spin N' Stamp Cartridge Copy
$2.98
 
1.00
XS34342
Spin N' Stamp Cartridge Draft
$2.99
 
1.00
XS34343
Spin N' Stamp Cartridge Past Due
$2.99
 
1.00
XS34344
Spin N' Stamp Cartridge Posted
$2.99
 
1.00
XS40240
Automatic Numbering Machine 6 Wheel
$69.96
 
2.00
XS40242
Automatic Numbering Machine 7 Wheel
$74.95
 
1.00
XS40244
Automatic Numbering Machine 8 Wheel
$49.98
 
1.00
XS40246
Automatic Numbering Machine 10 Wheel
$64.98
 
1.00
XS40248
Automatic Numbering Machine 12 Wheel
$74.98
 
1.00
XS40271
Exhibit Stamper Alpha
$94.45
 
3.00
XS40275
Exhibit Stamper Numeric  1-999
$94.46
 
3.00
XS81041
10-in-1 Phrase Stamp
$19.43
 
1.00
XS8512
Xstamper Spin N' Stamp Copy, Draft, Original
$37.44
 
3.00
XS8514
Xstamper Spin N' Stamp Posted/Paid/Received
$12.49
 
1.00
XS8515
Xstamper Spin N' Stamp Entered/File Copy/Completed
$12.49
 
1.00
XS9998
Exhibit Stock Stamp
$59.90
 
5.00
XS9999
Redacted Stock Stamp
$83.82
 
7.00
 
 
-107-

 
Schedule 2.1(c)
 
Contracts

Stern Properties Office Lease dated 9/6/05
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
-108-

 
This Lease made the 6th day of September between Stern Properties hereinafter referred to as LANDLORD, and Lester Levin Inc., d/b/a Legal Store.com hereinafter jointly, severally and collectively referred to as TENANT.

     Witnesseth, that the Landlord hereby leases to the Tenant, and the Tenant hereby hirers and takes from the Landlord Unit #209 – consisting of approx. 3,829 square feet in the building known as 320 North Goodman Street; Rochester, New York 14607 to be used and occupied by the Tenant sales and distribution of legal supplies and for no other purpose, for a term to commence on or about November 1, 2005 term of five (5) years and to end on or about October 31, 2010 unless sooner terminated as hereinafter provided, at the ANNUAL RENT of SEE RIDER ATTACHED TO AND MADE PART OF LEASE all payable in equal monthly installments in advance on the first day of each and every calendar month during said term, except the first installment, which shall be paid upon the execution hereof.

     THE TENANT JOINTLY AND SEVERALLY COVENANTS:

     FIRST--That the Tenant will pay the rent as above provided.

     SECOND--Repairs; Ordinances and Violations; Entry; Indemnify Landlord.  That, throughout said terms the Tenant will take good care of the demised premises, fixtures and appurtenances, and all alterations, additions and improvements to either; make all repairs in  and about the same necessary to pay the expense of such repairs; suffer no waste or injury; give prompt notice to the Landlord of any fire that may occur; execute and comply with all laws, rules, orders, ordinances and regulations at any time issued or in force (except those requiring structural alterations), applicable to the demised premises or to the Tenant’s occupation thereof, of the Federal, State and Local Governments, and of each and every department, bureau and official thereof, and o the New York Board of Fire Unde rwriters; permit at all times during usual business hours, the Landlord and representatives of the Landlord to enter the demised premises for the purpose of inspection, and to exhibit them for purposes of sale or rental; suffer the Landlord to make repairs and improvements to all parts of the building, and to comply with Landlord to erect, use, maintain, repair and replace pipes and conduits in the demised premises and to the floors above and below; forever indemnify and save harmless the Landlord for and against any and all liability, penalties, damages, expenses and judgments arising from injury during said term to person or property of any nature, occasioned wholly or in part by any act or acts, omission or omissions of the Tenant, or of the employees, guests, agents, assigns or undertenants of the Tenant and also for any matter or thing growing out of the occupation of the demised premises or of the streets, sidewalks or vaults adjacent thereto; permit, during the six months next prior to the expiration of the term of the usual notice “To Let” to be placed and to remain unmolested in a conspicuous place upon the exterior of the demised premises; repair, at or before the end of the term, all injury done by the installation or removal of furniture and property; and at the end of the term, to quit and surrender the demised premises with all alterations, additions and improvements in good order and condition.
 
 
-109-

 
 
     THIRD.--Moving Injury Surrender; Negative Cotenants; Obstruction Signs; Air Conditioning.  That the Tenant will not disfigure or deface any part of the building, or suffer the same to be done, except so far as may be necessary to affix such trade fixtures as are herein consented to be the Landlord; the Tenant will not obstruct, or permit the obstruction of the street or the sidewalk adjacent thereto; will not do anything, or suffer anything to be done upon the demised premises which will increase the rate of fire insurance upon the building or any of its contents, or to be liable to cause structural injury to said building; will not permit the accumulation of waste or refuse matter, and will not, without the written consent of the Landlord first obtained in each case, either self, assign, except to an affiliate, mortgage or transfer this lease, underlet the demised premises or any part thereof, permit the same or any part thereof to be occupied by anybody other than the Tenant and the Tenant’s employees, make any alterations in the demised premises, use the demised premises or any part thereof for any purpose other than the one first above stipulated, or for any purpose deemed extra hazardous on account of fire risk, not in violation of any law or ordinance.  That the Tenant will not obstruct or permit the obstruction of the light, halls, stairway or entrances to the building, and will not erect or inscribe any sign, signals or advertisements unless and until the style and location thereof have been approved by the Landlord; and if any be erected or inscribed without such approval, the Landlord may remove the same.  No air conditioning unit or system or other apparatus shall be installed or used without the prior written consent of Landlord.

     IT IS MUTUALLY COVENANTED AND AGREED, THAT

     FOURTH.--Fire Clause.  If the demised premises shall be partially damaged by fire or other cause without the fault or neglect of Tenant, Tenant’s servants, employees, agents, visitors or licensees, the damages shall be repaired by and at the expense of Landlord and the rent until such repairs shall be made shall be apportioned according to the part of the demised premises which is usable by Tenant.  But if such partial damage is due to the fault or neglect of Tenant, Tenant’s servants, employees, agents, visitors or licensees, without prejudice to any other rights and remedies of Landlord and without prejudice ot the rights of subrogation of Landlord’s insurer, the damages shall be repaired by Landlord but there shall be no apportionment or abatement of rent.  N o penalty shall accrue for reasonable delay which may arise by reason of adjustment of insurance on the part of Landlord and/or Tenant, and for reasonable delay on account of “labor troubles”, or any other cause beyond Landlord’s control.  If the demised premises are totally damaged or are rendered wholly untentable by fire or other cause, and if Landlord shall decide not to restore or not to rebuild the same, or if the building shall be so damaged that Landlord shall decide to demolish it or to rebuild it, then or in any of such e vents Landlord may, within ninety (90) days after such fire or other cause, give Tenant a notice in writing of such decision, which notice shall be given as in Paragraph Twelve hereof provided, and thereupon the terms of the lease shall expire by lapse of time upon the third day after such notice is given, and Tenant shall vacate the demised premises and surrender the same to Landlord.  If Tenant shall not be in default under this lease, then upon the termination of this lease under the condition provided for in the sentence immediately preceding, Tenant’s liability for rent shall cease as of the day following the casualty.  Tenant hereby expressly waives the provisions of Section 227 of the real Property Law and agrees that the foregoing provisions of this Article shall govern and control in lieu thereof.  If the damage or destruction be due to the fault or neglect of Tenant the debris shall be removed by, and at the expense of, Tenant.
 
 
-110-

 
 
     FIFTH.--Eminent Domain.  If the whole or any part of the premises hereby demised shall be taken or condemned by any competent authority for any public use or purpose then the term hereby granted shall case from the time when possession of the part so taken shall be required for such public purpose and without apportionment of award, the Tenant hereby assigning to the Landlord all right and claim to any such awards, the current rent, however, in such case to be apportioned.

     SIXTH.--Lease not in Effect; Defaults; End Day Notice.  If, before the commencement of the term, the Tenant adjudicated a bankrupt, or make a “general assignment”, or take the benefit of any insolvent act, or if a Receiver or Trustee be appointed for the Tenant’s property, or if this lease or the estate of the Tenant hereunder be transferred or pass to or devolve upon any other person or corporation, or if the Tenant shall default in the performance of any agreement by the Tenant contained in any other lease to the Tenant by the Landlord or by any corporation of which an officer of the Landlord is a Director, this lease shall thereby, at the option of the Landlord, be terminated and in that case, neither the Tenant nor anybody claiming under the Tenant shall be entitled to go into possession of the demised premises.  If after the commencement of the term, any of the events mentioned above in this subdivision shall occur, or if Tenant shall make default in fulfilling any of the covenants of this lease, other than the covenants for the payment of rent or additional rent or if the demised premises become vacant or deserted, the Landlord may give to the Tenant ten days’ notice of intention to end the term of this lease, and thereupon at the expiration of said ten days (if said condition which was the basis of said notice shall continue to exist) the term under this lease shall expire as fully and completely as if that day were the date herein definitely fixed for the expiration of the term and the Tenant will then quit and surrender the demised premises to the Landlord, but the Tenant shall remain liable as hereinafter provided.

     Re-possession by Landlord; Re-Letting; Waiver by Tenant.  If the Tenant shall make default in the payment of the rent reserved hereunder, or any item of additional rent” herein mentioned, or any part of either or in making any other payment herein provided for, or if the notice last above provided for shall have been given and if the condition which was the basis of said notice shall exist at the expiration of said ten days’ period, the property therefrom, either by summary dispossess proceedings, or by any suitable action or proceeding at law, or by force or otherwise, without being liable to indictment, prosecution or damages thereof, and re-possess and enjoy said premises together with all additions, alterations and improvement.  In any such case or in the event that this le ase be “terminated” before the commencement of the term, as above provided, the Landlord may either re-let the demised premises or any part or parts thereof for the Landlord’s own account, or may, at the Landlord’s option, re-let the demised premises or any part or parts thereof as the agent of the Tenant, and receive the rents thereof, applying the same first to the payment of such expenses as the Landlord may have incurred, and then to the fulfillment of the covenants of the Tenant herein, and the balance, if any, at the expiration of the term first incurred, and then to the fulfillment of the covenants of the Tenant herein, and the balance, if any, at the expiration of the term first above provided for, shall be paid to the Tenant.  Landlord may rent the premises for a term extending beyond the term hereby granted without releasing Tenant from any liability.  In the event that the term of this lease shall expire as above in this subdivision “Sixth” p rovided, or terminate by summary proceedings or otherwise, and if the Landlord shall not re-let the demised premises for the Landlord’s own account, then, whether or not the premises be re-let, the Tenant shall remain liable for, and the Tenant hereby agrees to pay to the Landlord, until the time when this lease would have expired, but for such termination or expiration, the equivalent of the amount of all of the rent and additional rent” reserved herein, less the avails of re-letting, if any, and the same shall be due and payable by the Tenant to the Landlord on the several rent days above specified, that is, upon each of such rent days the Tenant shall pay to the Landlord the amount of deficiency then existing.  The Tenant thereby expressly waives any and all right of redemption in case the Tenant shall be dispossessed by judgment or warrant of any court or judge, and the Tenant waives and will waive all rights to trial by jury in any summary proceedings hereafter instituted by the La ndlord against the Tenant in respect to the demised premises.  The words “re-enter” and “re-entry” as used in this lease are not restricted to their technical legal meaning.
 
 
-111-

 
 
     Remedies are Cumulative.  In the event of a breach or threatened breach by the Tenant of any of the covenants or provisions hereof, the Landlord shall have the right of injunction and the right to invoke any remedy allowed at law or in equity, as if re-entry, summary proceedings and other remedies were not herein provided for.

     SEVENT.--Land may Perform; Additional Rent.  If the Tenant shall make default in the performance of any covenant herein contained, the Landlord may immediately, or at any time thereafter, without notice, perform the same for the account of the Tenant.  If a notice of mechanic’s lien be filed against the demised premises or against premises of which the demised premises are part, for, or purporting to be for, labor or material alleged to have been furnished, or to be furnished to or for the Tenant at the demised premises, and if the Tenant shall fail to take such action as shall cause such lien to be discharged within fifteen days after the filing of such notice, the Landlord may pay the amount  of such lien or discharge the same by deposit or by binding proceedings, and in the event of such deposit or bonding proceedings, the Landlord may require the lienor to prosecute an appropriate action to enforce the lienor’s claim.  In such case, the Landlord may pay any judgment recovered on such claim.  Any amount paid or expense incurred by the Landlord as in this subdivision of this lease provided, and any amount as to which the Tenant shall at any time be in default for or in respect to the use of water, electric current or sprinkler supervisory service, and any expense incurred or sum of money paid by the Landlord by reason of the failure of the Tenant to comply with any provision hereof, or in defending any such action, shall be deemed to be “additional rent” for the demised premises, and shall be due and payable by the Tenant to the Landlord on the first day of the next following month, or, at the option of the Landlord, on the first day of any succeeding month.  The receipt by the Landlord of any installment of the regular stipula tion rent hereunder or any of said “additional rent” shall not be a waiver of any other “additional rent” then due.

     EIGHT.--As to Waivers.  The failure of the Landlord to insist, in any one or more instances upon a strict performance of any of the covenants of this lease, or to exercise any option herein contained, shall not be construed as a waiver or a relinquishment for the future of such covenant or option, but the same shall continue and remain in full force and effect.  The receipt by the Landlord of rent, with knowledge of the breach of any covenant hereof, shall not be deemed a waiver of such breach and no waiver by the Landlord of any provision hereof shall be deemed to have been made unless expressed in writing and signed by the Landlord.  Even though the Landlord shall consent to an assignment hereof no further assignment shall be made without express consent in writing by the Landl ord.

 
 
 
-112-

 
 
     NINTH.--Collection of Rent From Others.  If this lease be assigned, or if the demised premises or any part thereof be underlet or occupied by anybody other than the Tenant the Landlord may collect rent from the assignee, under-tenant or occupant, and apply the net amount collected to the rent herein reserved, and no such collection shall be deemed a waiver of the covenant herein against assignment and underletting, or the acceptance of the assignee, under-tenant or occupant as tenant, or a release of the Tenant from the further performance by the Tenant of the covenants herein contained on the part of the Tenant.

     TENTH.--Mortgages.  This lease shall be subject and subordinate at all times, to the lien of the mortgages now on the demised premises, and to all advances made or hereafter to be made upon the security thereof, and subject and subordinate to the lien of any mortgage or mortgages which at any time may be made a lien upon the premises.  The Tenant will execute and deliver such further instrument or instruments subordinating this lease to the lien of any such mortgage or mortgages as shall be desired by any mortgagee or proposed mortgagee.  The Tenant hereby appoints the Landlord of the attorney-in-fact of the Tenant, irrevocable, to execute and deliver any such instrument or instruments for the Tenant.

     ELEVENTH.--Improvements.  All improvements made by The Tenant to or upon the demised premises, except said trade fixtures, shall when made, at once be deemed to be attached to the freehold, and become the property of the Landlord, and at the end or other expiration of the term, shall be surrendered to the Landlord in as good order and condition as they were when installed, reasonable wear and damages by the elements excepted.

     TWELFTH.--Notices.  Any notice or demand which under the terms of this lease or under any statute must or may be given or made by the parties hereto shall be in writing and shall be given or made by mailing the same by certified or registered mail addressed to the respective parties at the addresses set forth in this lease.

     THIRTEENTH.--No Liability.  The Landlord shall not be liable for any failure of water supply or electrical current, sprinkler damage, or failure of sprinkler service, nor for injury or damage to person or property caused by the elements or by other tenants or persons in said building, or resulting from stream, gas, electricity, water, rain or snow, which may leak or flow from any part of said buildings, or from the pipes, appliances or plumbing works of the same, or from the street or sub-surface, or from any other place, nor for interference with light or other incorporeal hereditaments by anybody other than the Landlord, or caused by operations by or for a governmental authority in construction of any public or quasi-public work, neither shall the Landlord be liable for any latent defect in the bu ilding.
 
 
-113-

 
 
     FOURTEENTH.--No Abatement.  No diminution or abatement of rent, or other compensation shall be claimed or allowed for inconvenience of discomfort arising from the making of repairs or improvements to the building or to its appliances, nor for any space taken to comply with any law, ordinance or order of a governmental authority.  In respect to the various “services,” if any, herein expressly or impliedly agreed to be furnished by the Landlord to the Tenant, it is agreed that there shall be no diminution or abatement of the rent, or any other compensation, for interruption or curtailment of such “service” when such interruption or curtailment shall be due to accident, alterations or repairs desirable or necessary to be made or to inability or difficulty in securing s upplies or labor for the maintenance of such “service” or to some other cause, not gross negligence on the part of the Landlord.  No such interruption or curtailment of any such “service” shall be deemed a constructive eviction.  The Landlord shall not be required to furnish, and the Tenant shall not be entitled to receive, any of such “services” during any period wherein the Tenant shall be in default in respect to the payment of rent.  Neither shall there be any abatement or diminution of rent because of making of repairs, improvements or decorations to the demised premises after the date above fixed for the commencement of the term, it being understood that rent shall, in any event, commence to run at such date so above fixed.

     FIFTEENTH.—Rules, etc.  The Landlord may prescribe and regulate the placing of safes, machinery, quantities of merchandise and other things.  The Landlord may also prescribe and regulate which elevator and entrances shall be used by the Tenant’s employees, and for the Tenant’s shipping.  The Landlord may make such other and further rules and regulations as, in the Landlord’s judgment, may from time to time be needful for the safety, care or cleanliness of the building, and for the preservation of good order therein.  The Tenant and the employees and agents of the Tenant will observe and conform to all such rules and regulations.

     SIXTEENTH.--Shoring of Walls.  In the event that an excavation shall be made for building or other purposes upon land adjacent to the demised premises or shall be contemplated to be made, the Tenant shall afford to the person or persons causing or to cause such excavation, license to enter upon the demised premises for the purpose of doing such work as said person or persons shall deem to be necessary to preserve the wall or walls, structure or structures upon the demised premises from injury and to support the same by proper foundations.

     SEVENTEENTH.--Vault Space.  No vaults or space not within the property line of the building are leased hereunder.  Landlord makes no representation as to the location of the property line of the building.  Such vaults or space as Tenant may be permitted to use or occupy are to be used or occupied under a revocable license and if such license be revoked by the Landlord as to the use or part or all of the vaults or space Landlord shall not be subject to any liability; Tenant shall not be entitled to any compensation or reduction in rent nor shall this be deemed constructive or actual eviction.  Any tax, fee or charge of municipal or other authorities for such vaults or space shall be paid by the Tenant for the period of the Tenant’s use or occupancy thereof.< /div>

 
 
-114-

 
 
     EIGHTEENTH.--Entry.  That during seven months prior to the expiration of the term hereby granted, applicants shall be admitted at all reasonable hours of the day to view the premises until rented; and the Landlord and the Landlord’s agents shall be permitted at any time during the term to visit and examine them at any reasonable hour of the day, and workmen may enter at any time, when authorized by the Landlord or the Landlord’s agents, to make or facilitate repairs in any part of the building; and if the said Tenant shall be personally present to open and permit an entry into said premises, at any time, when for any reason an entry therein shall be necessary or permissible hereunder, the Landlord or the Landlord’s agents may forcibly enter the same without rendering the Landlord o r such agents liable to any claim or cause of action for damages by reason thereof (if during such entry the Landlord shall accord reasonable care to the Tenant’s property) and without in any manner affecting the obligations and covenants of this lease; it is, however, expressly understood that the right and authority hereby reserved, does not impose, nor does the Landlord assume, by reason thereof, any responsibility or liability whatsoever for the care or supervision of said premises, or any of the pipes, fixtures, appliances or appurtenances therein contained or therewith in any manner connected.

     NINETEENTH.--No Representations.  The Landlord has made no representations or promises in respect to said building or to the demised premises except those contained herein, and those, if any, contained in some written communication to the Tenant, signed by the Landlord.  This instrument may not be changed, modified, discharged or terminated orally.

      TWENTIETH.--If the Tenant shall at any time be in default hereunder, and if the Landlord shall institute an action or summary proceeding against the Tenant based upon such default, then the Tenant will reimburse the Landlord for the expense of attorneys’ fees and disbursements thereby incurred by the Landlord, so far as the same are reasonable in amount.  Also so long as the Tenant shall be a tenant hereunder the amount of such expenses shall be deemed to be “additional rent” hereunder and shall be due from the Tenant to the Landlord on the first day of the month following the incurring of such respective expenses.

      TWENTY-FIRST.--Landlord shall not be liable for failure to give possession of the premises upon commencement date by reason of the fact that premises are not ready for occupancy, or due to a prior Tenant wrongfully holding over or any other person wrongfully in possession or for any other reason:  in such event the rent shall not commence until possession is given or is available, but the term herein shall not be extended.

THE TENANT FURTHER COVENANTS:

     TWENTY-SECOND.--If a First Floor.  If the demised premises or any part thereof consist of a store, or of a first floor, or of any part thereof, the Tenant will keep the sidewalk and curb in front thereof clean at all times and will keep insured in favor of the Landlord, all place glass therein and furnish the Landlord with policies of insurance covering the same.

 
 
 
-115-

 
 
     TWENTY-THIRD.--Increase Fire Insurance Rate.  If by reason of the conduct upon the demised premises of a business not herein permitted, or if by reason of the improper or careless conduct of any business upon or use of the demised premises, and fire insurance rate shall at any time be higher than it otherwise would be, then the Tenant will reimburse the Landlord, as additional rent hereunder, for that part of all fire insurance premiums hereafter paid out by the Landlord which shall have been charged because of the conduct of such business not so permitted, or because of the improper or careless conduct of any business upon or use of the demised premises, and will make such reimbursement upon the first day of the month following such outlay by the Landlord; but this covenant shall not apply to a pre mium for any period beyond the expiration date of this lease, first above specified.  In any action or proceeding wherein the Landlord and Tenant are parties, a schedule or “make up” of rate for the building on the demised premises, purporting to have been issued by New York Fire Insurance Exchange, or other body making fire insurance rates for the demised premises, shall be prima facie evidence of the facts therein stated and of the several items and charges included in the fire insurance rate then applicable to the demised premises.

     TWENTY-FOURTH.--Water Rent.  If a separate water meter be installed for the demised premises, or any part  thereof, the Tenant will keep the same in repair and pay the charges made by the municipality or water supply company for or in respect to the consumption of water, as and when bills therefor are rendered.  If the demised premises, or any part thereof, be supplied with water through a meter which supplies other premises, the Tenant will pay to the Landlord, as and when bills are rendered therfor, the Tenant’s proportionate part of all charges which the municipality or water supply company shall make for all water consumed through said meter, as indicated by said meter.   Such proportionate part shall be fixed by apportioning the respective charge accordi ng to floor area against all of the rentable floor area in the building (exclusive of the basement) which shall have been occupied ruing the period of the respective charges, taking into account the period that each part of such areas was occupied.  Tenant aggress to pay as additional rent the Tenant’s proportionate part determined as aforesaid, of the sewer rent or charge imposed or assessed upon the building of which the premises are a part.

     TWENTY-FIFTH.--Electric Current.  That the Tenant will purchase from the Landlord, if the Landlord shall so desire, all electric current that the Tenant requires at the demised premises, and will pay the Landlord for the same, as the amount of consumption shall be indicated by the meter furnished thereof.  The price for said current shall be the same as that charged for consumptions similar to that of the Tenant by the company supplying electricity in the same community.  Payments shall be due as and when bills shall be rendered.  The Tenant shall comply with like rules, regulations and contract provisions as those prescribed by said company for a consumption similar to that of the Tenant.

     TWENTY-SIXTH.--Sprinkler System.  If there now is or shall be installed in said building a “sprinkler system” the Tenant agrees to keep the appliances thereto in the demised premises in repair and good working condition, and if the New York Board of Fire Underwriters or the New York Fire Insurance Exchange or any bureau, department or official o f the State or local government requires or recommends that any changes, modifications, alterations or additional sprinkler heads or other equipment to be made or supplied by reason of the Tenant’s business, or the location of partitions, trade fixtures, or other contents of the demised premises, or if such charges, modifications, alterations, additional sprinkler heads or other equipment in the demised premises are necessary to prevent the imposition of a penalty or charge against the full allowance for a sprinkler system in the fire insurance rate as fixed by said Exchange, or by any Fire Insurance Company, the Tenant will at the Tenant’s own expense, promptly make and supply such changes, modifications, alterations, additional sprinkler heads or other equipment.  As additional rent hereunder the Tenant will pay to the Landlord, annually in advance, throughout the term $..........................., toward the contract price for sprinkler supervisory service.

 
 
 
-116-

 
 
     TWENTY-SEVENTH.--Security.  The sum of ………………………………… Dollars is deposited by the Tenant herein with the Landlord herein as security for the faithful performance of all the covenants and conditions of the lease by the said Tenant.  If the Tenant faithfully performs all the covenants and conditions on his part to be performed, then the sum deposited shall be returned to said Tenant.

     TWENTY-EIGHTH.--Nuisance.  This lease is granted and accepted on the especially understood and agreed condition that the Tenant will conduct his business in such a manner, both as regards noise and kindred nuisances, as will in no wise interfere with, annoy, or disturb any other tenants, in the conduct of their several businesses, or the Landlord in the management of the building; under penalty of forfeiture of this lease and consequential damages.

     TWENTY-NINTH.--Brokers Commissions.  The Landlord hereby recognizes …………………….. as the broker who negotiated and consummated this lease with the Tenant herein, and agrees that if, as, and when the Tenant exercises the option, if any, contained herein to renew this lease, or fails to exercise the option, if any, contained therein to cancel this lease, the Landlord will pay to said broker a further commission in accordance with the rules and commission rates of the Real Estate Board in the community.   A sale, transfer, or other disposition of the Landlord’s interest in said lease shall not operate to defeat the Landlord’s obligation to pay the said commission to the said broker.  The Tenant herein hereby represents to the Landlord that the said broker is the sole and only broker who negotiated and consummated this lease with the Tenant.

     THIRTIETH.--Window Cleaning.  The Tenant agrees that it will not require, permit, suffer, nor allow the cleaning of any window, or windows, in the demised premises from the outside (within the meaning of Section 202 of the Labor Law) unless the equipment and safety devices required by law, ordinance, regulation or rule, including, without limitation, Section 202 of the New York Labor Law, are provided and used, and unless the rules, or any supplemental rules of the Industrial Board of the State of New York are fully complied with; and the Tenant hereby agrees to indemnify the Landlord, Owner, Agent, Manager and/or Superintendent as a result of the Tenant’s requiring, permitting, suffering, or allowing any windows in the demised premises to be cleaned from the outside in violation of the requir ements of the aforesaid laws, ordinances, regulations and/or rules.

 
 
 
-117-

 
 
     THIRTY-FIRST.--Validity.  The invalidity or unenforceability of any provision of this lease shall in no way affect the validity or enforceability of any other provision thereof.

     THIRTY-SECOND.--Execution and Delivery of Lease.  In order to avoid delay, this lease has been prepared and submitted to the Tenant for signature with the understanding that it shall not bind the Landlord unless and until it is executed and delivered by the Landlord.

    THIRTY-THIRD.--Exterior of Premises.  The Tenant will keep clean and polished all metal, trim, marble and stonework which are a part of the exterior of the premises, using such materials and methods as the Landlord may direct, and if the Tent shall fail to comply with the provisions of this paragraph, the Landlord may cause such work to be done at the expense of the Tenant.

     THIRTY-FOURTH.--Plate Glass.  The Landlord shall replace at the expense of the Tenant any and all broken glass in the skylights, doors and walls in and about the demised premises.  The Landlord may insure and keep insured all plate glass in the skylights, doors and walls in the demised premises for an in the name of the Landlord and bills for the premiums thereof shall be rendered by the Landlord to the Tenant at such times as the Landlord may elect, and shall be due from and payable by the Tenant when rendered, and the amount thereof shall be deemed to be, and shall be paid as, additional rent.

     THIRTY-FIFTH.--War Emergency.  This lease and the obligation of Tenant to pay rent hereunder and perform all of the other covenants and agreements hereunder on part of Tenant to be performed shall in nowise be affected, impaired or excused because Landlord is unable to supply or is delayed in supplying any service expressly or impliedly to be supplied or is unable to make, or is delayed in making any repairs, additions, alterations or decorations or is unable to supply or is delayed in supplying any equipment of fixtures.  If Landlord is prevented or delayed from so doing by reason of governmental preemption in connection with a National Emergency declared by the President of the United States or in connection with any rule, order or regulation of any department or subdivision thereof of a ny government agency or by reason of the conditions of supply and demand which have been or are affected by war or other emergency.

 
 
 
-118-

 
 
THE LANDLORD COVENANTS

     FIRST.--Quiet Possession.  That if and so long as the Tenant pays the rent and  “additional rent” reserved hereby, and performs and observes the covenants and provisions hereof, the Tenant shall quietly enjoy the demised premises, subject, however, to the terms of this lease, and to the mortgages above mentioned, provided however, that this covenant shall be conditioned upon the retention of title to the premises by the Landlord.

     SECOND.--Elevator; Heat.  Subject to the provisions of Paragraph “Fourteenth” above the Landlord will furnish the following respective services:  (a) Elevator service, if the building shall contain an elevator or elevators, on all days except Sundays and holidays, from ____ A.M. to ________ P.M. and on Saturdays from ____A.M. to _______ P.M.; (b) Heat, during the same hours on the same days in the cold season in each year.


     And it is mutually understood and agreed that the covenants and agreements contained in the within lease shall be binding upon the parties hereto and upon their respective successors, heirs, executors and administrators.

     In witness thereof, the Landlord and Tenant have respectively signed and sealed these presents the day and year first above written.

In presence of:

/s/ Gary Stern [L.S.] Landlord
Stern Properties

/s/ Patrick White [L.S] Tenant
Lester Levin Inc. d/b/a
By:  Pat White
Title:  President


Acknowledgement in New York State (RPL 309-a)
State of New York, Count of                                           ss.:
On 14th September, 2005 before me, the undersigned appeared ____________________ personally known to me or proved to me on the basis of satisfactory evidence to be the individual(s) whose name(s) is (are) subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their capcity(ies), and that by his/her/their signature(s) on the instrument, the individual(s), or the person upon behalf of which the individual(s) acted, executed the instrument.

 
 
 
-119-

 
 
/s/ Rachel Estelle Perez
Notary Public State of New York
No ___________
Qualified in Monroe County
My Commission Expires February 7, 2009
(signature and office of individual taking acknowledgment)


State of NY
                                                             } ss.:
County of Monroe

On 9/15/05 before me, the undersigned, Gary Stern personally appeared the subscribing witness(es) to the foregoing instrument, with whom I am personally acquainted, who, being by me duly sworn, did dispose and say that he/she/they reside(s) in (if the place of residence is in a city, include the street and street number if any, thereof);

That he/she/they know(s)
To be the individual(s) described in and who executed the foregoing instrument; that said subscribing witness(es) was (were) present and saw said _________________________ execute the same; and that said witness(es) at the same time subscribed his/her/their name(s) as a witness(es) thereto.)

(If taken outside New York State insert city or political subdivision and state or country or other place acknowledgment taken And that said subscribing witness(es) mad esuch appearance before the undersigned in ___________________________)

/s/ Jean Marie Sak
Notary Public State of New York
Qualified in Monroe County 4856334
My Commission expires after April 14, 2006
(signature and office of individual taking acknowledgement)
 
 
 
 
-120-

 
 
Stern Properties
274 North Goodman Street
Rochester, New York 14607

RIDER TO LEASE BETWEEN:

Lester Levin Inc. d/b/a/ LegalStore.com (Tenant) and Stern Properties (Landlord)

1.
Rent Schedule:

Rent shall commence on or about November 1, 2005 or upon successful completion of improvements as described in Item 14, whichever is later, and rent for the first year of the Lease term will be equal to $1,474.50 per month.  Rent for each year of Lease term thereafter shall increase by the change in Consumer Price Index (“CPI”) over the preceding year as defined for major metropolitan areas in the month of July over the rent for the preceding year.

2.
Provided the Tenant has performed the terms, covenants, and conditions of the Lease on the part of the Tenant to be performed, then Tenant shall have the option to renew Lease for two (2) additional terms of two (2) years at the following rents:

Rent for each year of each option term shall increase by the change in CPI over the preceding year as defined for major metropolitan areas in the month of July over the rent for the preceding year.

Tenant shall exercise option(s) to renew Lease by giving Landlord written notice no less the four (4) months prior to expiration of Lease and option term, if exercised.  In the event that Tenant does not give written notice within that time period, then option(s) to renew Lease is null and void.

In the event that Tenant does not operate his business or maintain the Demised Premises (including fixtures, fittings, and merchandise) in a manner consistent with the Premises of which the Demised Premises are a part of, then the Landlord reserves the right not to grant options term(s), such right not to be unreasonably withheld by Landlord.

Tenant cannot sublet the Demised Premises or any part thereof but may assign its rights to a subsidiary under option(s) to renew Lease.  It is understood and agreed that option(s) to renew Lease is granted by the Landlord solely for the use of the Tenant.

3.
 
That the Tenant has this day deposited with the Landlord the sum of $1,474.50 as security for the full and faithful performance by the Tenant of all the terms, covenants and conditions of this lease upon the Tenant’s part to be performed, which said sum shall be returned to the Tenant thirty (30) days after the time fixed as the expiration of the term herein, provided the Tenant has fully and faithfully carried out all the said terms, covenants and conditions on the Tenant’s part to be performed.  In the event of a bonafide sale, subject to this Lease, the Landlord shall have the right to transfer security to the Vendee for the benefit of the Tenant and the Landlord shall be considered released by the Tenant from all liability for the return of such security; and the return of said security, and it is agreed that thi s shall apply to every transfer or assignment made of the security to a new Landlord.

 
 
 
-121-

 
 
4.
 
In the event any payment due hereunder is not received by no later than the fifth (5th) day of the month in which it is currently due, then and in that event there shall be an additional charge of interest due at the rate of ten percent (10%) per annum on the unpaid rental amount calculated from the due date through the date paid; this interest shall be paid in addition to the total rental so due.

5.
 
Any Tenant whose check issued to landlord in payment of rent or any other charges that is returned by Landlord’s bank for any reason, so that the amount is caused to be deducted from Landlord’s account shall be subject to the following:
 
 
5.1
A $25.00 Administrative Charge.

 
5.2
Reimbursement of any extra charges assessed to Landlord’s account by Landlord’s bank.
 
5.3
Interest at the rate of ten percent (10%) per annum on the unpaid rental amount calculated from the due date through the date paid.

 
5.4
All future payments of rent and / or other charges to be made by cash or certified check only.

6.
 
Tenant is responsible for all its own costs with respect to the gas and electric utility services to the demised premises.

7.
(a.)  The Tenant agrees to maintain in full force throughout the Lease term, a its own cost and expense, one or more polices of public Liability and property damage insurance which, up to the maximum liability amounts thereof, insures the Tenant and the Landlord (and such other person(s) designated by the Landlord having insurable interest) against liability for injury or death to persons and/or damage to property in or about the Demised Premises.  The limits of liability of such insurance shall not be less than $500,000 for each occurrence and not less than $1,000,000 aggregate.  Such liability insurance must be written on an occurrence basis.  The insurance required by this section shall be primary insurance and the insurer shall be liable for the full amount of the loss up to and including the to tal limit of liability as set forth in the declarations.

7.
(b.)  During the Lease Term, Tenant shall maintain in full force a policy or policies on all its fixtures and equipment in the Demised Premises, a policy or policies on fire insurance insuring the Landlord and Tenant with standard extended coverage endorsements, to the extent of at least eighty (80%) percent of their insurable value, containing the proper co-insurance provisions to prevent the Tenant from being a co-insured.  As long as this Lease is in effect, the proceeds from any such policy or policies shall be used for the repair or replacement of the items so insured.

 
 
 
-122-

 
 
7.
(c.)  All insurance required to be secured by Tenant in accordance with subparagraphs (a) and (b) hereof shall be evidenced by certificates of insurance which shall be furnished to the Landlord.  Each such policy shall name Landlord as an ‘additional insured” and shall be endorsed to provide that thirty (30) days noticeof cancellation or amendment will be given to the Landlord.  Upon Tenant’s failure to produce such insurance and deliver the policy or policies or certificates therefor to the Landlord, at its option, may exercise one or both of the following:

(c-1)  Within then (10) days prior to the date of commencement of the term hereunder or ten (10) days before the expiration of any policy delivered to the Landlord, Landlord may, at its option, upon ten (10) days written notice to Tenant, obtain such insurance or any of same and the premium or premiums therefore shall be deemed to be and shall be paid by Tenant as additional rent at the next monthly rent payment day.

(c-2)  If Tenant fails to furnish Landlord with a copy of certificate of any insurance policy required to be furnished by Tenant to landlord when due and such failure continue for ten (10) days after written notice from Landlord, landlord may assess and collect and administrative fee of Five and No/100 Dollars ($5.00) for each day said policy or certificate has not been received in the office of Landlord at the close of each business day.

8.
 
This Rider and/or Exhibits attached hereto and duly executed by the Landlord and Tenant shall be deemed incorporated herein and made a part hereof.  In the event that any provision contained in the Rider is inconsistent with the terms of this lease, the provision contained in the Rider shall supersede the terms of this lease.

 
 
 
 
 
 
 
 
 
 
 
 
 
 
-123-

 

Schedule 2.1(e)

Proprietary Rights
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
-124-

 
Schedule 2.1(f)

Trade Accounts Receivable







 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
-125-

 
 
 
 
       
 
 
       
Customer Number
Customer
Current
30 Day
60 Day
90 Day
 
 
Open Balance
Open Balance
Open Balance
Open Balance
374
Dibble & M
$0.00
$85.54
$0.00
$0.00
5680
Northside P
$289.75
$0.00
$0.00
$0.00
288
Allen & O
$0.00
$70.15
$0.00
$0.00
837
Michael A
$0.00
$1.50
$0.00
$0.00
117
Timothy R
$93.96
$0.00
$0.00
$0.00
10222
Perry, A
84.55
$0.00
$0.00
$0.00
18767566
The Roth L
$0.00
$0.00
$0.00
$0.00
18767003
Seth E
$0.00
$0.00
$0.00
$0.00
548
Park E
$0.00
$0.00
($75.60)
$0.00
549
Peter T
$292.68
$0.00
$0.00
$0.00
123
Underberg & K
$0.00
$163.03
$0.00
$0.00
523
Frank C
$104.62
$0.00
$0.00
$0.00
261
Goldstein & L
$209.52
$20.52
$0.00
$0.00
268
John C.
$111.96
$0.00
$0.00
$0.00
18766922
The Housing C
$708.75
$0.00
$0.00
$0.00
462
Thomas C
$0.00
$3.60
$0.00
$513.81
995
O'Connor, R
$0.00
$0.00
$340.59
$0.00
612
Knauf,  S
$39.58
$0.00
$0.00
$0.00
127
Timothy D
$0.00
$0.00
$0.00
$74.52
525
Romeo L
$0.00
$1.50
$0.00
$0.00
225
Stephen M.
$0.00
$0.00
$89.05
$0.00
431
Riley & G
$0.00
$1.50
$0.00
$0.00
388
Ward, N
$417.96
$407.16
$0.00
$0.00
7809
Moyer, R
$93.37
$0.00
$0.00
$0.00
319
A. Clark
$0.00
$0.00
$154.75
$0.00
295
Hirsch & T
$106.92
$0.00
$0.00
$0.00
365
Paul W
$107.89
$0.00
$0.00
$0.00
205
Maureen A
$0.00
$3.68
$0.00
$1,824.34
112
Alaine T
49.62
$0.00
$0.00
$0.00
839
Town of Web
$48.45
$0.00
$0.00
$0.00
346
Nixon P
$157.77
$1.50
$0.00
$0.00
358
Bansbach, Z
$54.76
$0.00
$0.00
$0.00
137
Gallo & I
$85.10
$0.00
$0.00
$0.00
241
Thomas A
$0.00
$0.00
$39.37
$0.00
235
Weiner, L
$112.75
$0.00
$0.00
$0.00
129
Davidson, F
$0.00
$625.32
$0.00
$0.00
18768146
Florida Health
$0.00
$515.00
$0.00
$0.00
5881
Attorney William C
$0.00
$0.00
$0.00
$0.00
465
Paul A
$0.00
$1.50
$0.00
$142.56
18766956
Ashcraft F
$0.00
$0.00
$79.60
$0.00
301
Louis C
$0.00
$76.25
$0.00
$0.00
250
Gould, P
$39.80
$61.40
$0.00
$0.00
345
Harter, S
$228.96
$233.28
$0.00
$0.00
 
 
-126-

 
9156
Chapman P
$0.00
$0.00
$0.00
$13.60
2914
Thyroff & T
$68.04
$0.00
$0.00
$0.00
18766945
Michael A
$27.97
$0.00
$0.00
$0.00
5377
Florida H
$515.00
$0.00
$515.00
$0.00
735
FM R
$635.25
$0.00
$0.00
$0.00
8205
Village O
$208.80
$208.80
$0.00
$0.00
6618
Matthew D
$0.00
$94.96
$0.00
$0.00
18767643
Chantilly S
$0.00
$4.18
$0.00
$0.00
2085
ABM
$0.00
$34.24
$0.00
$0.00
18767894
PhRMA
$0.00
$0.00
$0.00
$1,087.00
18767327
Permal A
$1,975.13
$0.00
$0.00
$0.00
6179
Northwest H
$0.00
$0.00
$693.00
$231.00
231
Gates & A
$817.23
$0.00
$0.00
$0.00
115
Shapiro & D
       
18768111
Alpha
$630.00
$0.00
$0.00
$0.00
5463
Savarese L
$0.00
$612.84
$0.00
$0.00
143
Brown & H
$421.85
$143.59
$0.00
$0.00
7074
Sinai H
$0.00
$462.00
$0.00
$0.00
116
Chamberlain
25.87
206.71
58.05
106.92
5534
Johnson & J
$0.00
$3.40
$0.00
$0.00
12084
Wayne
$0.00
373.5
$0.00
$0.00
102
Alexander B
$0.00
363.85
$0.00
$0.00
821
David H
$0.00
$340.52
$0.00
$0.00
5289
J. Erik G
$0.00
$303.00
$0.00
$0.00
9394
City of Colum
$26.75
$251.45
$0.00
$0.00
3032
Multi Media
$0.00
$249.48
$0.00
$0.00
18767134
LAW OFFICE OF THOMAS G
$0.00
$0.00
$17.95
$224.40
18767408
The Iowa Clinic
$0.00
$231.00
$0.00
$0.00
7199
William C
$0.00
$231.00
$0.00
$0.00
113
Thomas & S
226.1
$0.00
$0.00
$0.00
2062
Kaplovitz & A
$211.00
$0.00
$0.00
$0.00
18768140
Cortina, M
$0.00
$206.95
$0.00
$0.00
153
Savannah B
$0.00
$181.02
$0.00
$0.00
7041
Law Office of Al W
$0.00
$0.00
$0.00
$0.00
471
Joanne L
$0.00
$178.36
$0.00
$0.00
5655
Ray C
$159.50
$0.00
$0.00
$0.00
18768038
Rhian D
$0.00
$156.60
$0.00
$0.00
12235
Garrity and G
153.9
$0.00
$0.00
$0.00
1122
Law Offices of Daniel R. M
$0.00
149.5
$0.00
$0.00
864
David L. P
$0.00
$148.12
$0.00
$0.00
342
Finucane & H
$0.00
$142.56
$0.00
$0.00
18768139
Robert D. T
$140.94
$0.00
$0.00
$0.00
18768195
LCP
$135.35
$0.00
$0.00
$0.00
207
Angelo C
$0.00
$0.00
$132.08
$0.00
7765
Pillsbury & L
$31.50
$99.75
$0.00
$0.00
150
Stephen E.
$0.00
$1.50
$0.00
$0.00
416
Warren W
$0.00
$129.06
$0.00
$0.00
 
 
-127-

 
18768081
Connell L
$0.00
$124.00
$0.00
$0.00
503
Iannuzo & I.
$0.00
$0.00
$0.00
$0.00
18767758
Law Office of Terry K
$0.00
$0.00
$0.00
$0.00
18768022
The Law Firm of Barbara S
$0.00
$0.00
$116.50
$0.00
18767290
Jonathan J. S
$0.00
$1.50
$0.00
$0.00
2499
Cascone & K
$0.00
$109.52
$0.00
$0.00
121
Richard A. K
108.54
$0.00
$0.00
$0.00
575
Heath & M
$0.00
$0.00
$107.89
$0.00
18768200
Office S
$107.20
$0.00
$0.00
$0.00
6491
Redfield L
$0.00
$0.00
$106.75
$0.00
5444
Varrone & V
$106.75
$0.00
$0.00
$0.00
421
Dennis N. H
$0.00
$0.00
$106.54
$0.00
5984
Giannascoli & A
$104.11
$0.00
$0.00
$0.00
18768198
The Orner L
$103.47
$0.00
$0.00
$0.00
3861
Benjamin & J
$0.00
$103.30
$0.00
$0.00
10181
O'Connell &L
101.08
$0.00
$0.00
$0.00
3013
Adler L
$0.00
$0.00
$99.90
$0.00
637
Lunn T
$50.27
$49.63
$0.00
$0.00
18768173
Rochelle H
$99.90
$0.00
$0.00
$0.00
10186
MVOS
$98.49
$0.00
$0.00
$0.00
3791
The Law Offices of Brent C
$0.00
$0.00
$94.74
$0.00
228
McConville,C
$91.48
$0.00
$0.00
$0.00
18767904
Attorney Celeste D
$0.00
$91.13
$0.00
$0.00
5499
Attorney at Law W. Bevis S
$0.00
$88.15
$0.00
$0.00
12240
Deborah M
$0.00
$88.10
$0.00
$0.00
3006
Drew D
$87.27
$0.00
$0.00
$0.00
429
Michael R
$84.01
$0.00
$0.00
$0.00
18767979
Law Offices of Donald T
$0.00
$0.00
$2.95
$78.44
18767897
The Boston L
$0.00
$0.00
$0.00
$0.00
139
Kenneth K
$0.00
$81.25
$0.00
$0.00
18767248
Wickins & A
$0.00
$73.44
$0.00
$0.00
18768002
Capital D
$0.00
$0.00
$72.45
$0.00
18767996
Felicia S
$0.00
$0.00
$66.21
$0.00
516
Michael J
$0.00
$62.59
$0.00
$0.00
315
Gilbert R. P
$0.00
$61.56
$0.00
$0.00
18768037
Leslie A
$0.00
$59.95
$0.00
$0.00
18768202
Education/E
$55.00
$0.00
$0.00
$0.00
18766969
Gray & F
$0.00
$53.62
$0.00
$0.00
18768187
Sylvia S
$52.60
$0.00
$0.00
$0.00
18767206
Sheffy & M
$0.00
$52.55
$0.00
$0.00
611
James D. B
$51.69
$0.00
$0.00
$0.00
564
Fero & I
$49.63
$0.00
$0.00
$0.00
299
John J. P
$0.00
$0.00
$47.54
$0.00
307
Peter P
$0.00
$47.30
$0.00
$0.00
18768191
Bass S
$45.55
$0.00
$0.00
$0.00
244
Kelly M
$39.80
$0.00
$0.00
$0.00
11067
Hirshberg A
$0.00
36.11
$0.00
$0.00
 
 
-128-

 
18768125
Dara B
$0.00
$34.43
$0.00
$0.00
18768143
Edward B
$0.00
$30.25
$0.00
$0.00
18768203
The Community S
$30.00
$0.00
$0.00
$0.00
4343
Pacific P
$27.31
$0.00
$0.00
$0.00
6770
Tom S
$23.54
$0.00
$0.00
$0.00
18767919
Deborah C
$0.00
$0.00
$22.98
$0.00
328
Paul F. B
$19.42
$0.00
$0.00
$0.00
18767520
Illinois Dept
$0.00
$1.50
$0.00
$0.00
318
Jennie M
$0.00
$13.99
$0.00
$0.00
3612
Barry F
$9.72
$0.00
$0.00
$0.00
321
Stoner & A
$0.00
$1.50
$0.00
$0.00
246
Underwood & R
$0.00
$0.00
($27.45)
$0.00
5707
Johnson, L
$0.00
$0.00
($30.44)
$0.00
131
Kaman, B
$320.38
$0.00
($352.62)
$0.00
18767584
bross, b
$0.00
$0.00
$0.00
$0.00
182
Muldoon & G
$0.00
$0.00
$0.00
$0.00
5095
Fields, D
$0.00
$0.00
$0.00
$0.00
1018
Patrick P
       
1018
Patrick P
$0.00
$1.50
$0.00
$0.00
1018
Patrick P
$0.00
$0.00
$0.00
$0.00
Total - D1018
Patrick P
$0.00
$1.50
$0.00
$0.00
 
Total
$11,716.11
$9,047.24
$2,477.78
$4,296.59





 
-129-

 


 

Schedule 2.1(h)

Cash and Cash Equivalents

Bank of America Account No. 009442661376 – Balance $10,405.83





 
 
 
 
 
 
 
 
 
 
 
 

 
 
-130-

 

Schedule 2.2

Excluded Assets


Outstanding operating leases not related to the Business.

Net Operating Loss carryovers.


 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
-131-

 
Schedule 2.3

Assumed Liabilities


Office lease with Stern Properties dated September 6, 2005

Trade payables listed on the Accounts Payable register as of the Closing Date.

Accrued Payroll of Legalstore.com employees Deanna Gadsby and John Lyon for the pay period beginning on Monday October 5, , 2009 through Thursday, October 8, , 2009.

Any liabilities in connection with the Contracts assigned under Section 2.1(c).

[Any liabilities listed on the Closing Balance Sheet]









 
-132-

 

Schedule 2.4(a)(v)

Closing Balance Sheet

LEGALSTORE.COM
 
Carve-Out Balance Sheets
 
As of
 
       
   
October 7,
 
   
2009
 
       
ASSETS
 
(unaudited)
 
       
Current assets:
     
Cash and cash equivalents
  $ 10,405  
Accounts receivable
    31,161  
Inventory
    101,011  
         
      Total current assets
    142,577  
         
Fixed assets, net
    32,218  
Goodwill
    81,013  
         
Total assets
  $ 255,808  
         
LIABILITIES AND STOCKHOLDERS' EQUITY
 
         
Current liabilities:
       
Accounts payable
  $ 13,264  
Current portion of capital lease obligations
    -  
         
      Total current liabilities
    13,264  
         
Divisional equity
    242,544  
         
Total liabilities and divisional equity
  $ 255,808  
 
 
-133-

 
Schedule 3.3

Purchase Price Allocation


Asset
Amount
   
   
                            
Total:

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
-134-

 
Schedule 4.1

Shareholders of Seller

Document Security Systems, Inc., a New York corporation

 
 
 
 
 
 
 
 
 
 
 
 
 
-135-

 
Schedule 4.2

Consent


Consent for the transaction is required under the Office lease with Stern Properties dated September 6, 2005
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
-136-

 
 
LANDLORD CONSENT AND ESTOPPEL CERTIFICATE

To:  Stern Properties, 274 N. Goodman St., Rochester, NY 14607

Re: Original Lease Date:
September 6, 2005
       Current tenant:
Lester Levin, Inc.
       Assignee, and after assignment,
 
       New Tenant:
Internet Media Services, Inc.
       Leased Premises:
Unit #209, consisting of approximately
 
3,829 square feet of the building located at
 
320 north Goodman Street, Rochester, New
 
York 14607

The undersigned, STERN PROPERTIES, as the current landlord (“Landlord”) under the above referenced lease agreement (the “Lease”) acknowledges that it has been advised that LESTER LEVIN Inc. (“Tenant”), the current Tenant of the Leased Premises under the Lease, is contemplating the assignment of the tenant’s interest as Tenant under the Lease to INTERNET MEDIA SERVICES, INC. (“Assignee” or “New Tenant”).  Tenant and Assignee have requested that the undersigned consent to such assignment and to deliver the Estoppel Certificate to the above named parties.

The undersigned, as the Landlord under the Lease, hereby certifies to Tenant and Assignee as follows:

 
1.
The Lease is in full force and effect and the Lease represents the entire agreement between the parties as to the Lease premises.
 
2.
The monthly base rent under the lease is $1,533.48.  All rent and additional rent for the Premises up to and including the date hereof, has been paid in full and Tenant has complied with all of its obligations under the Lease.
 
3.
The current term of the Lease expires on October 31, 2010.
 
4.
Tenant is not in default under the Lease, and , to the best of Landlord’s knowledge, no event has occurred which, with notice or lapse of time or both, would result in a default by Tenant under the Lease.
 
5.
Landlord consents to the assignment of this Lease to the Assignee.
 
6.
The statements contained herein may be relied upon by Tenant and Assignee.

The undersigned is duly authorized to execute this certificate.
 
Dated this 7th day of October, 2009.

LANDLORD:

STERN PROPERTIES
By:  /s/ Susan Fame, as agent for Stern Properties
 
 
 
 
 
-137-

 
Schedule 4.6

Litigation


None
 
 
 
 
 
 
 
 
 
 
 
 

 
 
-138-

 
Schedule 4.7

Intellectual Property


All of Seller’ existing customer databases.

All of Seller’ websites, domain names and URL’s, and all information and rights related thereto as follows:

LegalStore.com
LegalStore.org
LegalStore.mobi
LegalStore.me
LegalStore.us
legalstore.biz
legalstore.info
legalstore.ws
legalstore.tv

Seller will continue to own the domain name lesterlevin.com, but will direct web traffic to legalstore.com. Email will continue to flow as it currently does to lesterlevin.com.
 
 
 
 
 
 

 
 
-139-

 
Schedule 4.8

Insurance


Attached.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
-140-

 

 
Commercial Liability Insurance
CNA Insurance
#B2099780764
Workers Compensation Insurance
The Hartford Insurance
#76WEGNS6367
New York Disability
The Standard Life Insurance Company
#432330

 
 
 
 
 
 
 
 
 
-141-

 
Schedule 4.11

Affiliate Interests


The internet domain names listed in Schedule 4.7 owned by Seller are registered in the name of Patrick White and DSS and are to be assigned to Buyer at the Closing.
 
 
 
 
 
 
 
 
 
 
 
 
 

 
 
-142-

 
Schedule 5.6

IMS Stockholders

 
 

Name
Shares of IMS Common Stock Held
 
     
Raymond Meyers
9,000,000  
     
Michael Buechler
4,000,000  
     
Alex Orlando
1,000  
     
 
   
     
Total
13,001,000  

 
 
 
 
 
-143-

 
 
 
 
 
 
 
 
 
 

 

 
 
 
LAW OFFICE OF GARY A. AGRON
5445 DTC Pkwy., Suite 520
Greenwood Village, Colorado  80111
Telephone:  (303) 770-7254
Facsimile:  (303) 770-7257
gaa@agronlaw.com





October ___, 2009

Lester Levin Inc.
28 East Main Street, Suite 1525
Rochester, New York 14614

Document Security Systems, Inc.
28 East Main Street, Suite 1525
Rochester, New York 14614

Ladies and Gentlemen:

We have acted as counsel to Internet Media Services, Inc., a Delaware corporation (the “Buyer”), in connection with the execution and delivery by Buyer of the Asset Purchase Agreement, dated as of October ___, 2009 (the “Asset Purchase Agreement”), by and among Buyer and Lester Levin Inc. (the “Seller”).  This opinion is given to you pursuant to Section 2.4(b)(iii) of the Asset Purchase Agreement.  (Capitalized terms not otherwise defined herein are defined as set forth in the Asset Purchase Agreement.)< /font>

We have participated in the preparation and negotiation of the Asset Purchase Agreement and the exhibits and disclosure schedules thereto, and the other documents referred to therein.

Based on the foregoing, we give you our opinion as follows:
 
1.            Buyer, and its wholly-owned subsidiary Legal Store.Com, Inc., are each corporations duly formed, validly existing and in good standing under the laws of the State of Delaware.  Buyer has the requisite corporate power and authority to own, lease and operate its properties and assets as presently owned, leased and operated and to carry on its business as it is now being conducted.  Buyer has the full corporate right, power and authority to execute, deliver and carry out the terms of the Asset Purchase Agreement and all documents and agreements necessary to give effect to the provisions of the Asset Purchase Agreement and to consummate the transactions contemplated on the part of Buyer hereby.  The execution, delivery and consummation of the As set Purchase Agreement and all other agreements and documents executed in connection therewith by Buyer has been duly authorized by all necessary corporate action on the part of Buyer.  No other action, consent or approval on the part of Buyer, any stockholder of Buyer, or any other person or entity is necessary to authorize the execution, delivery and consummation of the Asset Purchase Agreement and all other agreements and documents executed in connection therewith.
 
2.           The execution and delivery of the Asset Purchase Agreement and the performance by Buyer of its obligations thereunder do not and will not conflict with or violate any provision of the certificate of incorporation and by-laws or similar organizational documents of Buyer or its subsidiary.
 
 
 
 
-144-

 
 
3.           The IMS Common Stock to be issued to DSS under the Asset Purchase Agreement has been duly authorized and upon issuance, the IMS Common Stock will be validly issued, fully paid and non-assessable, and free from all taxes, liens, claims and encumbrances other than securities law restrictions and shall not be subject to preemptive rights or other similar rights of stockholders of Buyer.
 
4.           The total authorized capital stock of Buyer consists of 25,000,000 shares of common stock, par value $.001 per share, of which 13,001,000 shares are outstanding as of the date hereof.  Immediately after the Closing, the authorized capital stock of Buyer will consist of an aggregate of 25,000,000 shares of common stock, of which 20,501,000 shares will be issued and outstanding. To our knowledge, there are no other options, warrants, conversion privileges or other rights presently outstanding to purchase or otherwise acquire from Buyer any capital stock or other securities of Buyer, or any other agreements to issue any such securities or rights.  The rights, privileges and preferences of the IMS Common Stock are as stated in Buyer’s certificate of incorporation, as amended.
 

 
Very truly yours,
 
/s/ Gary Agron
 
 
 
 
 
 
 
 
 
 
-145-

 
 
INTERNET MEDIA SERVICES, INC.
 
CERTIFICATE AS TO CHARTER DOCUMENTS, RESOLUTIONS AND ELECTION, QUALIFICATION, INCUMBENCY AND SIGNATURES OF OFFICERS
 
Pursuant to the Asset Purchase Agreement dated as of October ___, 2009 (“Asset Purchase Agreement”) by and Among Internet Media Services, Inc., a Delaware corporation (“Buyer”) and Lester Levin Inc., a New York corporation (“Seller”), Raymond Meyers hereby certifies to Seller, in his own name and on behalf of the Buyer, that he is the duly elected, qualified and acting Chief Executive Officer of Buyer and that, as such, he is authorized to execute this certificate on behalf of the Buyer, and further certifies as follows:
 
1.           Attached hereto as Exhibit A is a true, correct and complete copy of the Certificate of Incorporation of the Buyer, as in effect on the date hereof, and all amendments thereto (the “Certificate”), through and as of the date hereof.  Such Certificate is in full force and effect on this date.  No action has been taken by the Board of Directors of the Buyer for the purpose of effecting any further amendment to or modification of such Certificate;
 
2.           Attached hereto as Exhibit B is a true, correct and complete copy of the By-Laws of the Buyer and all amendments thereto and modifications thereof, as in effect on and as of the date hereof;
 
3.           Attached hereto as Exhibit C is a complete and correct copy of all resolutions of the Board of Directors and Shareholders of the Buyer authorizing and approving the execution, delivery and performance of the Asset Purchase Agreement and all of the transactions contemplated thereunder, and all other documents and instruments to be delivered pursuant to the Asset Purchase Agreement.  Such resolutions are all the resolutions adopted in connection with the execution, delivery and performance of the Asset Purchase Agreement, and such resolutions have not been amended, modified, revoked or rescinded and are in full force and effect on and as of the date hereof; and
 
4.           The person named below is, as of the date hereof, a duly elected, acting and qualified officer of the Buyer, and as of the date of execution of the Asset Purchase Agreement, was, and on the date hereof is, an officer of the Buyer, holding the office set forth opposite his name, duly authorized to execute and deliver the Asset Purchase Agreement, in the name and on behalf of the Buyer, and any certificate, document or other instrument in connection therewith, and the signature set forth opposite his name below is his genuine signature.
 
Name
Title
Signature
Raymond Meyers
Chief Executive Officer
/s/ Raymond Meyers
Michael Buechler
Secretary
/s/ Michael Buechler

 

 
 
 
 
-146-

 
 

 

 
IN WITNESS WHEREOF, the undersigned has hereunto set his hand as of the ____ day of October 2009.

 
 
/s/ Raymond Meyers
 
Raymond Meyers, Chief Executive Officer

 
I, Michael Buechler, ____________, do hereby certify for an on behalf of Buyer that Raymond Meyers is the duly elected or appointed qualified and acting Chief Executive Officer of Buyer, and the signature set forth above is the genuine signature of such officer.
 

 
 
/s/ Michael Buechler
 
Michael Buechler

 

 
 
 
-147-

 
 
 
EXHIBIT A
 

 
[Certificate of Incorporation]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
-148-

 
 
EXHIBIT B
 

 
[By-laws]
 
 
 
 
 
 
 
 
 
 
 

 
 
 
 
-149-

 
 
 
EXHIBIT C
 
[Resolutions]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
-150-

 
 

 
EX-10.3 4 ex10-3.htm ex10-3.htm
Exhibit 10.3
CREDIT AGREEMENT


Dated as of April 8, 2010

between
 
 
INTERNET MEDIA SERVICES, INC.
as Borrower,


and


RAYMOND MEYERS
as Lender.
 
 
 
 
 
 
 

 
 
-1-

 

CREDIT AGREEMENT

Credit Agreement (“Agreement”), made April 8, 2010 by and between INTERNET MEDIA SERVICES, INC. (the “Company”) and RAYMOND MEYERS (“Lender”).

W I T N E S S E T H:

WHEREAS, the Lender has agreed to to loan certain funds to the Company, and the Company has agreed to borrow certain funds from Lender, subject to the terms and conditions set forth therein;

NOW THEREFORE, in consideration of the terms and conditions contained herein, and of any loans or extensions of credit heretofore, now or hereafter made to or for the benefit of the Company by the Lender (all of said loans hereafter referred to as the “Loans”), the parties hereto hereby agree as follows:

1.
DEFINITIONS.
 
1.1.           General Terms.  When used herein, the following terms shall have the following meanings:
 
(i)                 “Acquisition” means any transaction, or any series of related transactions, consummated on or after the date of this Agreement, by which Company (i) acquires any going business or all or substantially all of the assets of any firm, corporation or division thereof, whether through purchase of assets, merger or otherwise or (ii) directly or indirectly acquires (in one transaction or as the most recent transaction in a series of transactions) at least a majority (in number of votes) of the securities of a corporation which have ordinary voting power for the election of directors (other than securities having such power only by reason of the happening of a co ntingency) or a majority (by percentage or voting power) of the outstanding partnership interests of a partnership.
 
(ii)                 “Affiliate” shall mean any Person (1) which directly or indirectly controls, or is controlled by, or is under common control with the Company or a Subsidiary; (2) which directly or indirectly beneficially owns or holds five percent (5%) or more of any class of voting stock of the Company or any Subsidiary; or (3) five percent (5%) or more of the voting stock of which is directly or indirectly beneficially owned or held by the Company or a Subsidiary. The term “control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through the owner ship of voting securities, by contract, or otherwise.
 
(iii)                 “Available Principal Balance” shall mean an amount equal to the Maximum Revolving Facility the outstanding principal balance of Revolving Credit Loans.
 
-2-

 
(iv)                 “Business Day” means any day other than a Saturday, Sunday, or other day on which commercial lenders in New York, New York are authorized or required to close under the laws of the State of New York.
 
(v)                 “Capital Lease” means all leases which have been or should be capitalized on the books of the lessee in accordance with GAAP.
 
(vi)                 “Code” means the Internal Revenue Code of 1986, as amended from time to time, and the regulations and published interpretations thereof.
 
(vii)                “Debt” means (1) indebtedness or liability for borrowed money; (2) obligations evidenced by bonds, debentures, notes, or other similar instruments; (3) obligations for the deferred purchase price of property or services (including trade obligations); (4) obligations as lessee under Capital Leases; (5) current liabilities in respect of unfunded vested benefits under Plans covered by ERISA; (6) obligations under letters of credit; (7) obligations under acceptance facilities; (8) all guaranties, endorsements (other than for collection of deposit in the ordinary course of business), and other contingent obligations to purchase, to provide funds for payment, to supply funds to invest in any Person or entity, or otherwise to assure a creditor against loss; and (9) obligations secured by any Liens, whether or not the obligations have been assumed.
 
(viii)                 “Default” shall mean the occurrence or existence of any one or more of the following events.
 
(a)           The Company fails to pay any of its material “Liabilities” (as hereinafter defined) when due and said failure continues for a period of thirty (30) days after written notice of same from the Lender to the Company;
 
(b)           Company fails or neglects to perform, keep or observe any of the covenants, conditions or agreements contained in this Agreement (other than those as stated in Sections 5.1, 5.2, 5.3 and 5.8, and all negative covenants contained in Section 6 hereof with respect to all of which no notice and cure period shall be applicable; and those stated in Section 5.9 which shall not be considered a ground of Default unless the failure to comply with same continues for a period of fifteen (15) days after written notice of same from the Lender to the Company) or in any of the other Loan Documents executed by Company and said failure continues for a period of thirty (30) days after written notice of same from the Lender to the Company;
 
(c)           Any warranty or representation now or hereafter made by the Company in connection with this Agreement or any of the other Loan Documents is untrue or incorrect in any material respect, or any schedule, certificate, statement, report, financial data, notice, or writing furnished at any time by the Company to the Lender is untrue or incorrect in any material respect, on the date as of which the facts set forth therein are stated or certified;
 
(d)           A proceeding under any Bankruptcy, reorganization, arrangement of debt, insolvency, readjustment of debt or receivership law or statute is filed against Company which is not dismissed within sixty (60) days of its filing, or a proceeding under any Bankruptcy, reorganization, arrangement of debt, insolvency, readjustment of debt or receivership law or statute is filed by Company or the Company makes an assignment for the benefit of creditors or Company takes any corporate action to authorize any of the foregoing;
 
-3-

 
(e)           Company voluntarily or involuntarily dissolves or is dissolved, terminates or is terminated;
 
(f)            Company becomes insolvent or fails generally to pay its debts as they become due, including with access to the Available Principal Balance, and said failure continues for a period of thirty (30) days after written notice of same from the Lender to the Company;
 
(g)           A default under any of the other Transaction Documents;
 
(h)           One or more judgments, decrees, or judicial orders for the payment of money which in the aggregate, in any fiscal year of Company, exceeds $250,000.00 shall be rendered against the Company or any of its Subsidiaries, and such judgments, decrees, or judicial orders shall continue unsatisfied and in effect for a period of thirty (30) consecutive days without being vacated, discharged, satisfied, or stayed or appealed;
 
(ix)                  “GAAP” means generally accepted accounting principles in the United States.
 
(x)                  “Liabilities” shall mean all of Company’s liabilities, obligations, and indebtedness to Lender of any and every kind and nature, whether heretofore, now or hereafter owing, arising, due or payable and howsoever evidenced, created, incurred, acquired, or owing, whether primary, secondary, direct, contingent, fixed or otherwise (including obligations of performance and all Rate Hedging Obligations) whether arising under or in accordance with the Transaction Documents or otherwise.
 
(xi)                 “LIBOR Loan” means any Loan when and to the extent that the interest rate therefor is determined by reference to the one-year LIBOR Interest Rate.
 
(xii)                 “Lien” means any mortgage, deed of trust, pledge, security interest, hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or other), or preference, priority, or other security agreement or preferential arrangement, charge, or encumbrance of any kind or nature whatsoever (including, without limitation, any conditional sale or other title retention agreement, any financing lease having substantially the same economic effect as any of the foregoing, and the filing of any financing statement under the New York Uniform Commercial Code or comparable law of any jurisdiction to evidence any of the foregoing).
 
(xiii)                 “Maximum Revolving Commitment” shall mean $200,000.00.
 
-4-

 
(xiv)                 “Permitted Liens” shall mean (i) Liens securing the payment of taxes, either not yet due or the validity amount or imposition of which is being contested in good faith by appropriate proceedings, (ii) the Liens and security interests in favor of the Lender, (iii) currently existing Liens as of the date of the Agreement, (iv) purchase money liens to third parties in connection with new equipment purchases or Capital Leases provided the aggregate purchase price for said equipment and total lease payments under any Capital Leases does not exceed $150,000 in any fiscal year of Company.
 
(xv)                 “Person” shall mean any individual, sole proprietorship, partnership, joint venture, trust, unincorporated organization, association, corporation, institution, entity, party, or government (whether national, federal, state, provincial, county, city, municipal or otherwise, including, without limitation, any instrumentality, division, agency, body or department thereof).
 
(xvi)                 “Principal Office” means the Lender’s office at 4553 Glencoe Ave., Suite 325, Marina del Ray, CA 90292
 
(xvii)                 “Rate Hedging Obligations” shall mean any and all obligations of the Company or any Subsidiary, whether absolute or contingent and howsoever and whensoever created, arising, evidenced or acquired (including all renewals, extensions and modifications thereof and substitutions therefor), under (i) any and all agreements designed to protect the Company or any Subsidiary from the fluctuations of interest rates, exchange rates or forward rates applicable to such party’s assets, liabilities or exchange transactions, including, but not limited to: interest rate swap agreements, dollar-denominated or cross-currency interest rate exchange agreements, forw ard currency exchange agreements, interest rate cap, floor or collar agreements, forward rate currency agreements or agreements relating to interest rate options, puts and warrants, and (ii) any and all agreements relating to cancellations, buy backs, reversals, terminations or assignments of any of the foregoing.
 
(xviii)               “Regulation D” means Regulation D of the Board of Governors of the Federal Reserve System as amended or supplemented from time to time.
 
(xix)                  “Revolving Credit Loans” shall have the meaning assigned to such term in Section 2.1.
 
(xx)                  “Revolving Note” shall mean that certain Two Hundred Thousand and No/100 Dollar ($200,000.00) note dated of even date herewith substantially in the form of Exhibit B hereto executed by Company and made payable to the order of Lender.
 
(xxi)                 “Security Agreement” shall mean a security agreement encumbering all of the Company’s accounts receivable to secure the Company’s obligations hereunder, substantially in the form of Exhibit A hereto.
 
(xxii)                 “Subsidiary” shall mean, as to the Company, a corporation of which shares of stock having ordinary voting power (other than stock having such power only by reason of the happening of a contingency) to elect a majority of the board of directors or other managers of such corporation are at the time owned, or the management of which is otherwise controlled, directly, or indirectly through one or more intermediaries, or both, by the Company.
 
 
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(xxiii)                “Termination Date” shall mean April 8, 2011.
 
(xxiv)                “Transaction Document(s)” means this Agreement, the Revolving Note, and the Pledge and Security Agreement.
 
1.2.           Accounting Terms.  Any accounting terms used in this Agreement which are not specifically defined herein shall have the meanings customarily given them in accordance with GAAP.
 
1.3.           Others Defined in New York Uniform Commercial Code.  All other terms contained in this Agreement (and which are not otherwise specifically defined herein) shall have the meanings provided by the Uniform Commercial Code of the State of New York (the “Commercial Code”) to the extent the same are used or defined therein.
 
2.
CREDIT.
 
2.1.           Revolving Loan.  If a Default does not exist, and subject to the provisions of Article 3 below, the Lender shall, until but not after the Termination Date, advance to the Company, on a revolving credit basis loans (the “Revolving Credit Loans”), in an amount not to exceed at any time the Available Principal Balance.  Subject to Section 2.2, each Revolving Credit Loan to the Company shall, on the day of such advance be deposited, in immediately available funds, in such account as the Company may, from time to time, designate. The indebtedness of Company under all Revolving Credit Loans shall be evidenced by the Revolving Note.  Each Revolving Credit Lo an shall be in an amount not less than Ten Thousand and No/100 ($10,000.00) Dollars.  Within the terms of this Agreement, the Company may borrow, repay pursuant to Section 2.6, and reborrow under this Section 2.1.
 
2.2.           Maximum Principal Balance of Revolving Loan.  The aggregate outstanding principal balance of all Revolving Credit Loans shall at no time exceed the Maximum Revolving Commitment.  The aggregate outstanding principal balance of the Revolving Credit Loans at any time shall be the amounts advanced from time to time to Company and not repaid under Section 2.6.  The Company agrees that if at any time any such excess shall arise, the Company shall upon written request of Lender immediately pay to the Lender such amount as may be necessary to eliminate such excess.
 
2.3.           Notice and Manner of Borrowing.  The Company shall give the Lender written (including via e-mail) or telefax notice (effective upon receipt) of any Revolving Credit Loans under this Agreement, at least three (3) Business Days before any Revolving Credit Loan specifying: (1) the date of such Loan; and (2) the amount of such Loan.  Not later than 1:00 P.M. New York City time on the date of such Revolving Credit Loan and upon fulfillment of the applicable conditions set forth herein, the Lender will make such Revolving Credit Loan available to the Company in immediately available funds by crediting the amount thereof to the a pplicable account of the Company.
 
 
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2.4.           Interest.  The Company shall pay interest to the Lender on the outstanding and unpaid principal amount of the Revolving Credit Loans made under this Agreement at a rate of six percent (6%) in excess of the then in effect one-year LIBOR rate per annum.  Interest shall be calculated on the basis of a year of 360 days for the actual number of days elapsed. The Company shall pay interest quarterly in arrears no later than the tenth day of each calendar quarter commencing with the first calendar quarter following the disbursement of any Revolving Credit Loan.  Any principal amount not paid when due (at maturity, by acceleration or otherwise) shall bear interest thereafter until paid in full, payable on demand, at a rate per annum equal to four (4%) percent over the then applicable interest rate due under each Loan (the “Default Rate”).

2.5.           Prepayments.  The Company may prepay any Loan upon at least two (2) Business Days’ notice to the Lender in whole or in part with accrued interest to the date of such prepayment on the amount prepaid.
 
2.6.           Method of Payment.  The Company shall make each payment under this Agreement and under the Revolving Note not later than 2:00 P.M. New York time on the date when due in lawful money of the United States to the Lender at its Principal Office in immediately available funds.  The Company hereby authorizes the Lender, if and to the extent payment is not made when due under this Agreement or under the Revolving Note, to offset from any funds of the Company in any capacity with the Lender any amount so due.  Whenever any payment to be made under this Agreement or under the Revolving Note shall be stated to be due on a day other than a Business Day, such payment shall be made on the next succeeding Business Day, and such extension of time shall in such case be included in the computation of the payment of interest, as the case may be.
 
2.7.           Use of Proceeds.  The Company will use the proceeds of the Loans in accordance with a current operating budget as provided to Lender or as otherwise approved by Lender.  The Company will not use any of the proceeds of the Loans to purchase or carry any “margin stock” (as defied in Regulation U of the Board of Governors of the Federal Reserve System) or to make any Acquisition without the consent of the Lender.  The Company’s use of the proceeds of any advances and readvances made by the Lender to the Company pursuant to this Agreement are, and will continue to be, legal and proper corporate uses (duly authorized by its Board of Directors, if necessary pur suant to applicable corporate law, rule or regulation) and such uses are and will be consistent with all applicable laws and statutes, as in effect as of the date hereof.
 
2.8.           Illegality.  Notwithstanding any other provision in this Agreement, if the Lender reasonably determines that any applicable law, rule, or regulation, or any change therein, or any change in the interpretation or administration thereof by any governmental authority, central bank, or comparable agency charged with the interpretation or administration thereof, or compliance by the Lender with any request or directive (whether or not having the force of law) of any such authority, central bank, or comparable agency shall make it unlawful or impossible for the Lender to maintain its commitment under this Agreement, then upon notice to the Company by the Lender the commitment of the Lender under th is Agreement shall terminate; and the outstanding principal amount of the Loans, together with interest accrued thereon, and any other amounts payable to the Lender under this Agreement shall be repaid (a) immediately upon demand of the Lender if such change or compliance with such request, in the judgment of the Lender, requires immediate repayment; or (b) at the conclusion of the last calendar month before the effective date of any such change or request.
 
 
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2.9.           Increased Cost.  The Company shall pay to the Lender from time to time such reasonable amounts as the Lender may determine to be necessary to compensate the Lender for any costs incurred by the Lender which Lender determines are attributable to its making or maintaining any Loans hereunder or its obligation to make any such Loans hereunder, or any reduction in any amount receivable by the Lender under this Agreement or the Revolving Note in respect of any such loans or such obligation (such increases in costs and reductions in amounts receivable being herein called “Additional Costs”), resulting from any change after the date of this Agreement in U.S. federal, state, municipal, or foreign laws or regulations (including Regulation D and any applicable currency reserve requirements), or the adoption or making after such date of any interpretations, directives, or requirements applying to a class of lenders including the Lender or under any U.S. federal, state, municipal, or any foreign laws or regulations (whether or not having the force of law) by any court or governmental or monetary authority charged with the interpretation or administration thereof (“Regulatory Change”), which: (1) changes the basis of taxation of any amounts payable to the Lender under this Agreement or the Revolving Note in respect of any of such Loans (other than taxes imposed on the overall net income of the Lender for any of such Loans by the jurisdiction where the Principal Office is located); or (2) imposes or modifies any reserve, special deposit, compulsory loan, or similar requirements relating to any extensions of credit or other assets of, or any deposits with or other liabilities of, the Le nder; or (3) imposes any other conditions affecting this Agreement or the Revolving Note (or any of such extensions of credit or liabilities).  The Lender will notify the Company in writing of any event occurring after the date of this Agreement which will entitle the Lender to compensation pursuant to this Section 2.9 as promptly as practicable after it obtains knowledge thereof and determines to request such compensation.

Reasonable determinations by the Lender for purposes of this Section 2.9 of the effect of any Regulatory Change on its costs of making or maintaining Loans or on amounts receivable by it in respect of Loans, and of the additional amounts required to compensate the Lender in respect of any Additional Costs, shall be conclusive, provided that such determinations are made on a reasonable basis, are not subject to manifest error and the written basis for said determinations are given to Company.

2.10.         Risk-Based Capital.  In the event the Lender determines that (1) compliance with any judicial, administrative, or other governmental interpretation of any law or regulation or (2) compliance by Lender or any corporation controlling the Lender with any guideline or request from any central lender or other governmental authority (whether or not having the force of law) has the effect of requiring an increase in the amount of capital required or expected to be maintained by the Lender or any corporation controlling the Lender, and the Lender determines that such increase is based upon its obligations hereunder, and other similar obligations, the Company shall pay to the Lender such additional amount as sha ll be certified by the Lender to be the amount allocable to the Lender’s obligations to the Company hereunder.  The Lender will notify the Company in writing of any event occurring after the date of this Agreement that will entitle the Lender to compensation pursuant to this Section 2.10 as promptly as practicable after it obtains knowledge thereof and determines to request such compensation.

 
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Determinations by the Lender for purposes of this Section 2.10 of the effect of any increase in the amount of capital required to be maintained by the Lender and of the amount allocable to the Lender’s obligations to the Company hereunder shall be conclusive, provided that such determinations are made on a reasonable basis, are not subject to manifest error and the written basis for said determinations are given to Company.

3.
CONDITIONS OF ADVANCES.

Notwithstanding any other provisions contained in this Agreement, the making of any advance in connection with any Revolving Loan shall be conditioned upon the following:

3.1.           Representations and Warranties
 
(i)                  The following statements shall be true on and as of the date of each advance as though made on and as of such date; and
 
(ii)                 No Default has occurred and is continuing, or would result from such advance; and
 
(iii)                The Lender shall have received the executed Transaction Documents in a form and content reasonably acceptable to Lender; and
 
(iv)                The Lender shall have received such other approvals, opinions, or documents as the Lender may reasonably request including but not limited to an opinion of counsel to Company, in a form and content acceptable to Lender; and tax, judgment, pending litigation and Uniform Commercial Code searches showing no matters objectionable to Lender.
 
3.2.           Financial Condition.  No material adverse change, as determined by Lender in its reasonable discretion, in the financial condition or operations of the Company, shall have occurred and be continuing at any time or times subsequent to, as applicable the most recent financial statement provided by the Company.  In no event shall Lender’s agreement to continue to honor requests for advances be deemed to constitute a waiver by the Lender of its absolute right at any time in the future to notify the Company of a material adverse change in the financial condition or operations of the Company, based upon information in the possession of Lender prior to any advance of funds hereunder.
 
3.3.           Security Agreement.  The Security Agreement shall be duly executed and delivered by the Company, and shall be validly enforceable in accordance with its terms.
 
3.4.           No Default.  No Default shall have occurred and be continuing under this Agreement or any of the Transaction Documents.
 
3.5.           Completeness of Representations. The representations and warranties set forth in the Transaction Documents shall, as of the date hereof, be true, correct and complete in all respects.
 
 
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3.6.           Other Requirements.  Lender shall have received, in form and substance reasonably satisfactory to Lender, all certificates, orders, authorities, consents, affidavits, schedules, instruments, security agreements, financing statements, mortgages, financial statements including any other documents which carry out the purposes of this Agreement and which are provided for hereunder, or which Lender may at any time reasonably request.
 
4.
REPRESENTATIONS AND WARRANTIES.

The Company represents and warrants that as of the date of the execution of this Agreement, and continuing so long as any Liabilities remain outstanding, and (even if there shall be no Liabilities outstanding) so long as this Agreement remains in effect:

4.1.           Corporate Existence.  The Company is a corporation duly organized and in good standing under the laws of the state of its incorporation or such other state as may be permitted under this Agreement.  The Company is duly qualified as a foreign corporation and in good standing in all other states or jurisdictions, whether foreign or domestic, where the nature and extent of the business transacted by it or the ownership of its assets makes such qualification necessary.
 
4.2.           Corporate Authority.  The execution and delivery by the Company of this Agreement and of all of the other Transaction Documents by Company to which it is a party and the performance of the Company’s obligations hereunder and of Company’s obligations thereunder:  (i) are within the Company’s corporate powers; (ii) are duly authorized by the Company’s Board of Directors and, if necessary, the Company’s stockholders; (iii) are not in contravention of the terms of the Company’s Articles of Incorporation, Charter, or By-Laws, or any other organizational documents or of any indenture, agreement or undertaking to which the Company is a par ty or by which the Company or any of its property is bound; (iv) do not, as of the execution hereof, require any governmental consent, registration or approval; (v) to the best of the Company’s knowledge, do not contravene any contractual or governmental restriction binding upon the Company.
 
4.3.           Financial Data.  The financial statements to be furnished to the Lender will be in accordance with the books and records of the Company and will fairly present the financial condition of the Company at the dates thereof and the results of operations for the periods indicated (subject, in the case of unaudited financial statements, to normal year-end adjustments), and such financial statements will be prepared in conformity with generally accepted accounting principles consistently applied throughout the periods involved.  All information, reports and other papers and data furnished to the Lender are or will be, at the time the same are so furnished to the Lender, accurate, correct a nd complete in all material respects.
 
4.4.           Collateral. Except for Permitted Liens, all of the property of Company is and will continue to be owned by the Company, has been fully paid for (except for Debt relating to Permitted Liens) and is free and clear of all security interests, liens, claims, and encumbrances.
 
4.5.           Solvency.  After taking into account the funds available under this Agreement, the Company is solvent, is able to pay its debts as they become due and has capital sufficient to carry on its businesses and all business in which it is about to engage.  The Company will not be rendered insolvent by the execution and delivery of this Agreement or any of the Loan Documents to which it is a signatory or by the transactions contemplated hereunder or thereunder.
 
 
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4.6.           Chief Place of Business.  As of the execution hereof, the principal place of business of the Company is located at 1434 6th Street, Unit 9, Santa Monica, CA 90401.  If any change in such location occurs, the Company shall promptly notify the Lender thereof.  As of the execution hereof, the books and records of the Company and all chattel paper and all records of account are located at the aforesaid office of the Company and if any change in such location occurs, the Company shall promptly notify the Lender thereof.
 
4.7.           Other Corporate Names.  As of the date hereof, the Company is not using any corporate or fictitious names other than the corporate name shown on the Company’s Articles of Incorporation or other applicable charter or organizational documents.
 
4.8.           Tax Liabilities.  The Company will file and will cause any Subsidiary to file all federal, state and local tax reports and returns required by any US or other applicable law or regulation to be filed by it or said Subsidiary, except for extensions duly obtained, and has either duly paid all taxes, duties and charges indicated due on the basis of such returns and reports, or made adequate provision for the payment thereof, and the assessment of any material amount of additional taxes in excess of those paid and reported is not reasonably expected.  The Company believes that the reserves for taxes reflected on the balance sheets of Company submitted to Lender in accordance with this A greement will be adequate in amount for the payment of all liabilities for all taxes (whether or not disputed) of the Company accrued through the date of such balance sheet.  There are no material unresolved questions or claims concerning any tax liability of the Company.
 
4.9.           Contingent Obligations.  Except as specifically referenced in the financial statements described in this Agreement and delivered to Lender prior to the date hereof or other than as permitted by this Agreement, the Company has not guaranteed the obligation of any other Person.
 
4.10.         Margin Security.  The Company’s execution and delivery of this Agreement and each of the Loan Documents to which it is a party does not directly or indirectly violate or result in a violation of Section 7 of the Securities Exchange Act of 1934, as amended, or any regulations issued pursuant thereto, including without limitation, Regulation U, G, T or X of the Board of Governors of the Federal Reserve System (12 CFR 221, 207, 220 and 224, respectively; “Regulation U”, “Regulation G”, “Regulation T” and “Regulation X”, respectively) and Company does not own or intend to purchase or carry any “margin security,” as defined in Regulations U, G , T or X.
 
4.11.         Survival of Warranties.  All representations and warranties contained in this Agreement or any of the other Loan Documents shall survive the execution and delivery of this Agreement.
 
4.12.         Litigation and Proceedings.  Other than as disclosed in the Company’s filings with the Securities and Exchange Commission, there are no judgments outstanding against the Company or any Subsidiary and, there is no pending or, to the Company’s knowledge, threatened litigation, contested claim, or governmental proceeding by or against the Company which would have a materially adverse effect on the financial condition or operation of the Company.
 
 
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4.13.         Other Agreements.  The Company is not in default under any material contract, lease, loan, mortgage, or indenture to which it is a party or by which it or its property is bound which would have a materially adverse effect on the financial condition or operation of the Company.
 
4.14.         Compliance with Laws and Regulations.  The execution and delivery by the Company of this Agreement and the execution and delivery by the Company of all of the other Loan Documents to which it is a signatory and the performance of the Company’s obligations hereunder and the Company’s obligations thereunder are not in contravention of any law or laws.  The Company is in material compliance with all laws, orders, regulations and ordinances of all federal, foreign, state and local governmental authorities relating to the business operations and the assets of the Company.
 
4.15.         Patents, Trademarks and Licenses.  The Company possesses adequate assets, licenses, patents, patent applications, copyrights, service marks, trademarks and trade names to continue to conduct its businesses as heretofore conducted by it.
 
4.16.         Enforceable Agreement.  This Agreement is, and each of the other Loan Documents when delivered under this Agreement will be, legal, valid, and binding obligations of the Company, enforceable against the Company in accordance with their respective terms, except to the extent that such enforcement may be limited by applicable Bankruptcy, insolvency, and other similar laws affecting creditors’ rights generally.
 
4.17.         Material Adverse Change.  There has been no material and adverse change in the assets, liabilities or financial or other condition of the Company since the date of any of the Financial Statements delivered to Lender under this Agreement.
 
5.
AFFIRMATIVE COVENANTS.

The Company covenants and agrees that so long as any Liabilities remain outstanding, and (even if there shall be no Liabilities outstanding) so long as this Agreement remains in effect:

5.1.           Financial Statements.  The Company shall keep and cause each Subsidiary to keep proper books of record and account in which full and true entries will be made of all dealings or transactions of or in relation to the businesses and affairs of the Company in accordance with GAAP consistently applied.
 
5.2.           Inspection.  The Lender, or any Person designated by Lender in writing, shall have the right, from time to time hereafter, to call at the Company’s place or places of business during reasonable business hours upon three (3) days prior notice, and, without hindrance or delay, (i) to inspect, audit, check and make copies of and extracts from the Company’s and Subsidiary’s respective books, records, journals, orders, receipts and any correspondence and other data relating to the Company’s and any Subsidiary’s businesses or to any transactions between the parties hereto, and (ii) to discuss the respective affairs, finances and businesses of the Company and any Subsidiary with any of the respective officers, employees or directors of the Company or Subsidiary.
 
 
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5.3.           Conduct of Business.  The Company shall maintain its corporate existence, shall maintain in full force and effect all licenses, bonds, franchises, leases, trademarks, patents, contracts and other rights necessary or reasonably desirable to the profitable conduct of its businesses, shall continue in, and limit its operations to, the same general type of business as that presently conducted by it and shall comply in all material respects with all applicable laws and regulations of any federal, state or local governmental authority.
 
5.4.           Claims and Taxes.  The Company agrees to indemnify and hold the Lender harmless from and against any and all claims, demands, liabilities, losses, damages, penalties, costs, and expenses (including reasonable attorneys’ fees) relating to or in any way arising out of the possession, use, operation or control of any of the Company’s assets.  The Company shall pay or cause to be paid all license fees, bonding premiums and related taxes and charges, and shall pay or cause to be paid all taxes, assessments and government charges or levies on it or its properties, at such times and in such manner as to prevent any penalty from accruing or any lien or charge from attaching to s uch property, provided that the Company shall have the right to contest in good faith, by an appropriate proceeding promptly initiated and diligently conducted, the validity, amount or imposition of any such tax, assessment, charge or levy.
 
5.5.           Lender’s Closing Costs and Expenses.  The Company shall reimburse the Lender on demand for all reasonable expenses and fees paid or incurred in connection with the documentation, negotiation and closing of the transactions described herein, including, without limitation, filing and recording fees and reasonable attorneys’ fees of Lender’s counsel.
 
5.6.           Maintain Property.  The Company will maintain its property in good condition (reasonable wear and tear excepted) and make all necessary renewals, repairs, replacements, additions, betterments and improvements thereto.
 
5.7.           Company’s Property and Liability Insurance.  The Company shall at its expense, keep and maintain its assets insured against loss or damage by fire, theft, explosion, spoilage and all other hazards and risks ordinarily insured against by other owners or users of such properties in similar businesses in an amount reasonably acceptable to Lender.  All such policies of insurance shall be in form and substance satisfactory to Lender.  In addition, Company shall maintain adequate liability insurance in an amount, form and content reasonably acceptable to Lender.
 
5.8.           Notice of Suit or Adverse Change in Business.  The Company shall, as soon as possible, and in any event within fifteen (15) days after it learns of the following, give written notice to the Lender of (i) any material proceeding(s) being instituted by or against the Company or any Subsidiary, in any federal, state, local or foreign court or before any commission or other regulatory body (federal, state, local or foreign), and (ii) any material adverse change in the business, assets or condition, financial or otherwise, of the Company.  For purposes of this Agreement, any information filed with the Securities and Exchange Commission shall satisfy the requirement of providing written notice to the Lender.
 
5.9.           Reporting Requirements.  The Company shall furnish to the Lender (for purposes of this Agreement, any information filed with the Securities and Exchange Commission shall be considered furnished to the Lender as of the date of such filing):
 
(i)                 Quarterly Financial Statements.  As soon as available and in any event within forty-five (45) days after the end of each fiscal quarter balance sheets of the Company as of the end of such quarter, statements of income and retained earnings of the Company for the period commencing at the end of the previous quarter and ending with the end of such quarter, and statements of changes in financial position of the Company, all in reasonable detail and stating in comparative form the respective figures for the year to date and all prepared in accordance with generally accepted accounting principles consistently applied and certified by the chief financial officer of the Company.
 
 
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(ii)                 Annual Financial Statements.  As soon as available and in any event within one hundred twenty (120) days after the end of each fiscal year of the Company, balance sheets of the Company as of the end of such fiscal year, and statements of income and retained earnings of the Company for such fiscal year, and statements of changes in financial position of the Company for such fiscal year, all in reasonable detail and stating in comparative form the respective figures for the corresponding date and period in the prior fiscal year and all prepared on an audited basis, and in accordance with generally accepted accounting principles consistently applied by an acc ounting firm acceptable to the Lender.
 
(iii)                Notice of Litigation.  Promptly after the commencement thereof, notice of all actions, suits, and proceedings before any court or governmental department, commission, board, bureau, agency, or instrumentality, domestic or foreign affecting the Company which, if determined adversely to the Company, would have a material adverse effect on the financial condition, properties, or operations of the Company.
 
(iv)                Notice of Defaults and Events of Default.  As soon as reasonably possible and in any event within five (5) days after the occurrence of each Default, a written notice setting forth the details of such Default and the action which is proposed to be taken by the Company, with respect thereto.
 
(v)                 General Information.  Such other information respecting the condition or operations, financial or otherwise, of the Company as the Lender may from time to time reasonably request including without limitation customer lists including addresses of account debtors.  Lender agrees to hold any confidential information which it may receive from Company pursuant to this Agreement in confidence except for disclosure on a need to know basis (i) to affiliates of Lender or any participants in the Loans, (ii) to legal counsel, accountants and other professional advisors to Lender, (iii) to regulatory officers, or (iv) to any Person as requested pursuant to or as required by law, regulation or legal process.
 
6.
NEGATIVE COVENANTS.

The Company covenants and agrees that so long as any Liabilities remain outstanding, and (even if there shall be no Liabilities outstanding) so long as this Agreement remains in effect (unless the Lender shall give its prior written consent thereto):
 
6.1.           Encumbrances.   Except for the Permitted Liens, the Company will not create, incur, assume, or suffer to exist, any mortgage, deed of trust, pledge, lien, security interest, hypothecation, assignment, deposit arrangement, or other preferential arrangement, charge, or encumbrance (including, without limitation, any conditional sale, or other title retention agreement, or finance lease) of any nature, upon or with respect to any of its properties, now owned or hereafter acquired, or sign or file, or permit any Subsidiary to sign or file, under the Uniform Commercial Code of any jurisdiction a financing statement (other than financing statements related to Permitted Liens and financing stat ements required to be executed by lessors under operating leases entered into by Company or any Subsidiary with said lessors) which names the Company as a debtor, or sign any security agreement authorizing any secured party thereunder to file such financing statement.
 
 
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6.2.           Disposal of Property.  The Company shall not nor allow any Subsidiary to sell, assign, transfer or otherwise dispose of any of its respective equipment to any Person without the Lender’s prior written consent other than in the normal course of business in connection with the sale of obsolete or no longer used equipment of Company or any Subsidiary.
 
6.3.           Amendment of Certificate of Incorporation or By-Laws.  Company shall not amend its Articles of Incorporation or By-Laws, charter or other organizational documents without the Lender’s prior written consent.
 
6.4.           Transactions with Affiliates.  Company will not, without the prior written consent of the Lender, enter into any transaction including, without limitation, the lending or borrowing of monies, the purchase, sale or exchange of property or the rendering of any service to any Affiliate, except in the ordinary course of and pursuant to the reasonable requirements of Company’s business and upon fair and reasonable terms no less favorable to Company than would be obtained in a comparable arm’s length transaction with an unaffiliated person or corporation.
 
6.5.           Acquisitions.  The Company shall not directly or indirectly acquire or merge with any other Person without the prior written consent of Lender.
 
6.6.           Debt.   Company shall not incur any further Debt from any other Person other than (i) Debt owed by Company to the Lender or (ii) Debt to the Persons disclosed to Lender in the financial statements of Company delivered to Lender prior to the date hereof or (iii) accounts payable incurred in the ordinary course of business to trade creditors for goods or services or (iv) current operating liabilities incurred in the ordinary course of business (other than for borrowed money) or (v) Debt in connection with purchase money financing and Capital Leases but not exceeding the amount as set forth in Section 1.1(xx)
 
6.7.           Dividends.  Company may not pay any dividends or make any distributions to any shareholder of Company at any time that Revolving Loans are outstanding.
 
6.8.           Mergers, Etc.  The Company shall not wind up, liquidate or dissolve itself, reorganize, merge or consolidate with or into, or convey, sell, assign, transfer, lease, or otherwise dispose of (whether in one transaction or in a series of transactions) all or substantially all of its assets (whether now owned or hereafter acquired) to any Person.
 
6.9.           Investments.  The Company shall not make, or permit any Subsidiary to make, any loan or advance to any Person, or purchase or otherwise acquire, or permit any Subsidiary to purchase or otherwise acquire, any capital stock, assets, obligations, or other securities of, make any capital contribution to, or otherwise invest in or acquire any interest in any Person, or participate as a partner or joint venturer with any other Person, except: (1) direct obligations of the United States or any agency thereof with maturities of one year or less from the date of acquisition; (2) commercial paper of a domestic issuer rated at least “A-1” by Standard & Poor’s Corporation or “ P-1” by Moody’s Investors Service, Inc. at the time of said investment; (3) certificates of deposit with maturities of one year or less from the date of acquisition issued by any commercial Lender having capital and surplus in excess of Four Hundred Million and No/100 Dollars ($400,000,000.00) at the time of said investment; (4) stock, obligations, or securities received in settlement of debts (created in the ordinary course of business) owing to the Company or any Subsidiary; and (5) repurchase agreements or eurodollar currency deposit investments with any commercial Lender which meets the financial requirements of subsection (3) hereof at the time of said investment.

 
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7.
DEFAULT, RIGHTS AND REMEDIES OF THE LENDER.
 
7.1.           Liabilities.  If a Default shall exist or occur and be continuing, and upon the expiration of any applicable cure period, the Lender may without notice declare all of the Liabilities immediately due and payable, in the Lender’s sole discretion, in either (a) immediately available funds or (b) newly issued common stock of the Company valued at the average closing price of the such common stock for the prior ten Business Days.
 
7.2.           Rights and Remedies Generally.  If a Default shall exist or occur and be continuing, and upon the expiration of any applicable cure period, the Lender shall have, in addition to any other rights and remedies contained in this Agreement and the Transaction Documents, all of the rights and remedies under applicable laws, all of which rights and remedies shall be cumulative, and none exclusive, to the extent permitted by law.
 
7.3.           Termination of Agreements.  Upon the occurrence of any Default, Lender may also, with or without proceeding with sale or foreclosure or demanding payment of the Liabilities, without notice, terminate Lender’s further performance under this Agreement or any other agreement or agreements between Lender and Company and in addition may suspend Lender’s obligation to make any further advances hereunder during any cure period without further liability or obligation by Lender, and may also, upon the occurrence of any Default, appropriate and apply on any Liabilities any and all balances, credits, deposits, accounts, reserves, indebtedness, or other monies due or owing to Company or held by Lender hereunder or under any such financing agreement or otherwise, whether accrued or not.  Neither such termination, nor the termination of this Agreement by lapse of time, the giving of notice, or otherwise, shall absolve, release, or otherwise affect the liability of Company in respect of transactions had prior to such termination, nor affect any of the liens, security interests, rights, powers and remedies of Lender, but they shall, in all events, continue until all indebtedness and Liabilities of Company to Lender are satisfied.  Lender shall not, in any manner, be liable to Company for any failure to make or continue to make any Loans or advances to Company hereunder as a result of Lender refusal to so make said Loans or advances in accordance with the terms of this paragraph.
 
7.4.           Waiver of Demand.  Demand, presentment, protest and notice of nonpayment are hereby waived by the Company.  The Company also waives the benefit of all valuation, appraisal and exemption laws.
 
 
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8.
MISCELLANEOUS.
 
8.1.           Waiver.  The Lender’s failure, at any time or times hereafter, to require strict performance by the Company of any provision of this Agreement shall not waive, affect or diminish any right of the Lender thereafter to demand strict compliance and performance therewith.  Any suspension or waiver by the Lender of a Default under this Agreement shall not suspend, waive or affect any other Default under this Agreement, whether the same is prior or subsequent thereto and whether of the same or of a different kind or character.  None of the undertakings, agreements, warranties, covenants and representations of the Company contained in this Agreement and no Default under thi s Agreement shall be deemed to have been suspended or waived by the Lender unless such suspension or waiver is in writing signed by an officer of the Lender, and directed to the Company specifying such suspension or waiver.  If requested in writing by Company, Lender shall give written confirmation to Company of any suspension or waiver by Lender as described in this Section.
 
8.2.           Costs and Attorneys’ Fees.  If at any time or times hereafter the Lender employs counsel in connection with any matters contemplated by or arising out of this Agreement, whether (a) to commence, defend, or intervene in any litigation or to file a petition, complaint, answer, motion or other pleadings, (b) to take any other action in or with respect to any suit or proceeding (Bankruptcy or otherwise), (c) to consult with officers of the Lender to advise the Lender, or (d) enforce any rights of the Lender to collect any of the Liabilities, then in any of such events, all of the reasonable attorneys’ fees arising from such services, and any expenses, cos ts and charges relating thereto, including, without limitation, all fees of all paralegals, together with interest at the Default Rate described in Section 2.6 above then in effect, shall be part of the Liabilities, payable on demand.
 
8.3.           Expenditures by the Lender.  In the event Company shall fail to pay taxes, insurance, assessments, costs or expenses which the Company is, under any of the terms hereof, required to pay, the Lender may, in its sole discretion, make expenditures for any or all of such purposes, and the amount so expended, together with interest thereon at the Default Rate described in Section 2.6 above, shall be part of the Liabilities, payable on demand.
 
8.4.           Reliance by the Lender.  All covenants, agreements, representations and warranties made herein by the Company, shall, notwithstanding any investigation by the Lender, be deemed to be material to, and to have been relied upon by, the Lender.
 
8.5.           Parties.  Whenever in this Agreement there is reference made to any of the parties hereto, such reference shall be deemed to include, wherever applicable, a reference to the respective successors and assigns of each of the Company, and the Lender.
 
8.6.           Applicable Law; Severability.  This Agreement shall be construed in all respects in accordance with, and governed by, the internal laws (as opposed to conflicts of law provisions) of the State of California.  Wherever possible, each provision of this Agreement shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Agreement shall be prohibited by or invalid under applicable law, such provision shall be ineffective only to the extent of such prohibition or invalidity, without invalidating the remainder of such provisions or the remaining provisions of this Agreement.
 
 
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8.7.           Cumulative Effect.  All covenants, conditions, provisions, warranties, guaranties, indemnities and other undertakings of the Company contained in this Agreement, or in the Loan Documents or in any schedule given to Lender or contained in any other agreement between Lender and the Company, heretofore, concurrently, or hereafter entered into, shall be deemed cumulative to and not in derogation or substitution of any of the terms, covenants, conditions or agreements of the Company herein contained.  The failure or delay of Lender to exercise or enforce any rights, liens, powers or remedies hereunder or under the Loan Documents or the other aforesaid agreements or other documents or aga inst any security or collateral shall not operate as a waiver of such liens, rights, powers and remedies, but all such liens, rights powers and remedies shall continue in full force and effect until all Liabilities shall have been fully satisfied, and all liens, rights, powers and remedies herein provided for are cumulative and none are exclusive.
 
8.8.           Amendments, Etc.  No amendment, modification, termination, or waiver of any provision of the Agreement, any Loan Document, nor consent to any departure by any of the parties from any Loan Document to which it is a party, shall in any event be effective unless the same shall be in writing and signed by the Lender, and then such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given.
 
8.9.           Integration.  This Agreement and the Loan Documents contain the entire agreement between the parties relating to the subject matter hereof and supersedes all oral statements and prior writings with respect thereto.
 
8.10.         Indemnity.  The Company hereby agrees to defend, indemnify, and hold the Lender harmless from and against any and all claims, damages, judgments, penalties, costs and expenses (including attorney fees and court costs now or hereafter arising from the aforesaid enforcement of this clause) arising directly or indirectly from the activities of the Company and its Subsidiaries, its predecessors in interest, or third parties with whom it has a contractual relationship, or arising directly or indirectly from the violation of any environmental protection, health, or safety law, whether such claims are asserted by any governmental agency or any other Person.  This indemnity shall survive termination o f this Agreement.
 
8.11.         Submission to Jurisdiction; Waiver of Jury Trial.  TO INDUCE THE LENDER TO MAKE THE LOANS EVIDENCED BY THIS AGREEMENT, THE COMPANY, IRREVOCABLY AGREES THAT, ALL ACTIONS ARISING DIRECTLY OR INDIRECTLY AS A RESULT OR IN CONSEQUENCE OF THIS AGREEMENT OR ANY OTHER AGREEMENT WITH THE LENDER SHALL BE INSTITUTED AND LITIGATED ONLY IN COURTS HAVING SITUS IN LOS ANGELES COUNTY. CALIFORNIA, AND THE COMPANY HEREBY CONSENTS TO THE EXCLUSIVE JURISDICTION AND VENUE OF ANY STATE OR FEDERAL COURT LOCATED AND HAVING ITS SITUS IN SAID COUNTY, AND WAIVES ANY OBJECTION BASED ON FORUM NONCONVENIENS, AND THE COMPANY HEREBY WAIVES PERSONAL SERVICE OF ANY AND ALL PROCESS, AND CONSENTS THAT ALL SUCH SERVICE OF PROCESS MAY BE MA DE BY CERTIFIED MAIL, RETURN RECEIPT REQUESTED, DIRECTED TO THE COMPANY AT THE ADDRESSES INDICATED IN THE LENDER’S RECORDS IN THE MANNER PROVIDED BY APPLICABLE STATUTE, LAW, RULE OF COURT OR OTHERWISE.

 
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THE LENDER AND THE COMPANY, KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE IRREVOCABLY, THE RIGHT IT MAY HAVE TO TRIAL BY JURY WITH RESPECT TO ANY LEGAL PROCEEDING BASED HEREON, OR ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT OR ANY OF THE OTHER OBLIGATIONS OR ANY AGREEMENT, EXECUTED OR CONTEMPLATED TO BE EXECUTED IN CONJUNCTION HEREWITH OR ANY COURSE OF CONDUCT OR COURSE OF DEALING, IN WHICH THE LENDER AND THE COMPANY, OR ANY ONE OF THEM, ARE ADVERSE PARTIES.  THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE LENDER GRANTING ANY FINANCIAL ACCOMMODATION TO THE COMPANY.  ALL WAIVERS HEREIN ARE MADE ONLY TO THE EXTENT PERMITTED BY APPLICABLE LAW.

8.12.         Application of Payments.  Notwithstanding any contrary provision contained in this Agreement, the Company irrevocably waives the right to direct the application of any and all payments at any time or times hereafter received by the Lender from or on behalf of the Company, and the Company does hereby irrevocably agree that the Lender shall have the continuing exclusive right to apply and reapply any and all payments received at any time or times hereafter, against the Liabilities in such manner as the Lender may deem advisable, notwithstanding any entry by the Lender upon any of its books and records.
 
8.13.         Marshalling; Payments Set Aside.  The Lender shall be under no obligation to marshall any assets in favor of the Company or any other party or against or in payment of any or all of the Liabilities.  To the extent that the Company makes a payment or payments to the Lender or Lender enforces its security interests or exercises its rights of setoff, and such payment or payments or the proceeds of such enforcement or setoff or any part thereof are subsequently invalidated, declared to be fraudulent or preferential, set aside and/or required to be repaid to a trustee, receiver or any other party under any Bankruptcy law, state or federal law, common law or equitable cause, then to the extent of su ch recovery, the obligation or part thereof originally intended to be satisfied shall be revived and continued in full force and effect as if such payment had not been made or such enforcement or setoff had not occurred.
 
8.14.         Section Titles.  The section titles contained in this Agreement shall be without substantive meaning or content of any kind whatsoever and are not a part of the agreement between the parties.
 
8.15.         Continuing Effect.  This Agreement shall continue in full force and effect so long as any Liabilities shall be owed to the Lender, and (even if there shall be no Liabilities outstanding) so long as this Agreement has not been terminated in accordance with its terms.
 
 
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8.16.         Notices.  Except as otherwise expressly provided herein, any notice required or desired to be served, given or delivered hereunder shall be in writing, and shall be deemed to have been validly served, given, delivered and/or received when (i) presented personally, or (ii) on the second business day next following deposit in the United States mails, with proper postage prepaid, registered or certified, return receipt requested, or (iii) on the first business day next following the day of delivery to Federal Express for delivery to the addressee, addressed to the party to be notified as follows:
 
(i)
If to the Lender:
   
 
Raymond Meyers
 
1434 6th Street, Unit 9
 
Santa Moncia, CA 90401
 
(ii)
If to Company:
   
 
Internet Media Services, Inc.
 
1434 6th Street, Unit 9
 
Santa Moncia, CA 90401

or to such other address as each party designates to the other in the manner herein prescribed.
 
8.17.         Equitable Relief.  Company recognizes that, in the event Company fails to perform, observe or discharge any of its obligations or liabilities under this Agreement, Lender’s remedy at law may prove to be inadequate relief to Lender; therefore, Company agrees that Lender, if Lender so requests, shall be entitled to temporary and permanent injunctive relief if Lender proves its entitlement to such equitable relief.
 
 
 
 

 
 
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IN WITNESS WHEREOF, this Agreement has been duly executed as of the day and year first above written.

 
INTERNET MEDIA SERVICES, INC.
   
 
By: /s/ Michael Buechler
 
Name: Michael Buechler
 
Title:   Executive Vice President and Secretary
   
 
By: /s/ Raymond Meyers
 
Raymond Meyers
 
Lender


 
 
 
 
 
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EX-10.4 5 ex10-4.htm ex10-4.htm
Exhibit 10.4
 
SECURITY AGREEMENT
 
SECURITY AGREEMENT, dated April 8, 2010, made by INTERNET MEDIA SERVICES, INC. (the “Borrower”), in favor of RAYMOND MEYERS (“Lender”).
 
W I T N E S S E T H:
 
WHEREAS, the Lender and the Borrower are parties to a Credit Agreement, dated as of the date hereof (such agreement, as amended, restated or otherwise modified from time to time, being hereinafter referred to as the “Credit Agreement”);
 
WHEREAS, pursuant to the Credit Agreement, the Lender has agreed to make certain term loans (each a “Loan” and collectively, the “Loans”) to the Borrower in an aggregate principal amount at any one time outstanding not to exceed the Maximum Revolving Commitment (as defined in the Credit Agreement);
 
WHEREAS, it is a condition precedent to the Lender making any Loan to the Borrower pursuant to the Credit Agreement, that the Borrower shall have executed and delivered to the Lender a security agreement providing for the grant to Lender of a security interest in all of the accounts receivable of the Company;
 
NOW, THEREFORE, in consideration of the premises and the agreements herein and in order to induce the Lender to make and maintain the Loans pursuant to the Credit Agreement, the Company hereby jointly and severally agrees with the Lender as follows:
 
SECTION 1.   Definitions .
 
(a)           Reference is hereby made to the Credit Agreement for a statement of the terms thereof.  All terms used in this Agreement and the recitals hereto which are defined in the Credit Agreement or in Article 9 of the Uniform Commercial Code (the “Code”) as in effect from time to time in the State of New York and which are not otherwise defined herein shall have the same meanings herein as set forth therein; provided that terms used herein which are defined in the Code as in effect in the State of New York on the date hereof shall continue to have the same meaning notwithstanding any replacement or amendment of such statute except as Lender may otherwise determine.
 
(b)           As used in this Agreement, the following terms shall have the respective meanings indicated below, such meanings to be applicable equally to both the singular and plural forms of such terms:
 
 
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SECTION 2.   Grant of Security Interest .  As collateral security for all of the Obligations (as defined in Section 3 hereof), the Company hereby pledges and assigns to the Lender, and grants to the Lender, a continuing security interest in all of the assets of the Company, whether now outstanding or as of a future date (the “Collateral”).
 
SECTION 3.   Security for Obligations .  The security interest created hereby in the Collateral constitutes continuing collateral security for all of the following obligations, whether now existing or hereafter incurred (the “Obligations”):
 
(a)           the prompt payment by the Company, as and when due and payable (by scheduled maturity, required prepayment, acceleration, demand or otherwise), of all amounts from time to time owing by it in respect of the Credit Agreement and the other Loan Documents, including, without limitation, (i) principal of and interest on the Loans (including, without limitation, all interest that accrues after the commencement of any Insolvency Proceeding of the Company, whether or not the payment of such interest is unenforceable or is not allowable due to the existence of such Insolvency Proceeding), and (ii) all fees, commissions, expense reimbursements, indemnifications and all other amounts due or to become due under any Loan Document; and
 
(b)           the due performance and observance by the Company of all of its other obligations from time to time existing in respect of the Loan Documents.
 
SECTION 4.   Representations and Warranties .  The Company represents and warrants as follows:
 
(a)           The Company (i) is a corporation duly organized, validly existing and in good standing under the laws of the state or jurisdiction of its organization, (ii) has all requisite power and authority to execute, deliver and perform this Agreement and each other Loan Document to be executed and delivered by it pursuant hereto and to consummate the transactions contemplated hereby and thereby, and (iii) is duly qualified to do business and is in good standing in each jurisdiction in which the character of the properties owned or leased by it or in which the transaction of its business makes such qualification necessary.
 
(b)           The execution, delivery and performance by the Company of this Agreement and each other Loan Document to which the Company is a party or will be a party (i) have been duly authorized by all necessary action, (ii) do not and will not contravene its charter or by-laws, or any applicable law or any contractual restriction binding on or otherwise materially affecting the Company, (iii) do not and will not result in or require the creation of any Lien upon or with respect to any of its properties and (iv) do not and will not result in any default, noncompliance, suspension, revocation, impairment, forfeiture or nonrenewal of any permit, license, authorization or approval applicable to it or its operations or any of its properties.
 
 
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(c)           This Agreement is, and each other Loan Document to which the Company is or will be a party, when executed and delivered pursuant hereto, will be, a legal, valid and binding obligation of the Company, enforceable against the Company in accordance with its terms, except as may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws.
 
(d)           The Company is and will be at all times the sole and exclusive owners of, or otherwise have and will have adequate rights in, the Collateral free and clear of any Lien except for (i) the Lien created by this Agreement and (ii) the Permitted Liens.  No effective financing statement or other instrument similar in effect covering all or any part of the Collateral is on file in any recording or filing office except (A) such as may have been filed in favor of Lender relating to this Agreement and (B) such as may have been filed to perfect or protect any security interests or Liens permitted by the Credit Agreement.
 
(e)           This Agreement creates in favor of Lender a legal, valid and enforceable security interest in the Collateral, as security for the Obligations.
 
SECTION 5.   Covenants as to the Collateral .  So long as any of the Obligations shall remain outstanding and the Credit Agreement and the other Loan Documents shall not have expired or terminated, unless Lender shall otherwise consent in writing:
 
(a)           Further Assurances.  The Company will at its expense, at any time and from time to time, promptly execute and deliver all further instruments and documents and take all further action that may be necessary or desirable or that Lender may request in order to (i) perfect and protect the security interest purported to be created hereby; (ii) enable Lender to exercise and enforce its rights and remedies hereunder in respect of the Collateral; or (iii) otherwise effect the purposes of this Agreement.
 
(b)           Transfers and Other Liens.
 
(i)           Except to the extent expressly permitted by the Credit Agreement, the Company will not sell or otherwise transfer (by operation of law or otherwise) any of the Collateral.
 
(ii)           Except to the extent expressly permitted by the Credit Agreement, the Company will not create, suffer to exist or grant any Lien upon or with respect to any Collateral.
 
SECTION 6.   Additional Provisions Concerning the Collateral .
 
(a)           The Company hereby (i) authorizes Lender to file, one or more financing or continuation statements, and amendments thereto, relating to the Collateral and (ii) ratifies such authorization to the extent that Lender has filed any such financing or continuation statements, or amendments thereto, prior to the date hereof.  A photocopy or other reproduction of this Agreement or any financing statement covering the Collateral or any part thereof shall be sufficient as a financing statement where permitted by law.
 
(b)           The Company hereby irrevocably appoints Lender as its attorney-in-fact and proxy, with full authority in the place and stead of the Company and in the name of the Company or otherwise, from time to time in Lender’s discretion, to take any action and to execute any instrument which Lender may deem necessary or advisable to accomplish the purposes of this Agreement (subject to the rights of the Company under Section 5 hereof), including, without limitation, to execute assignments, licenses and other documents to enforce the rights of Lender and the Lender with respect to any Collateral.  This power is coupled with an interest and is irrevocable until all of the Obligations are indefeasibly paid in full after the termination of the Credit Agreement and the other Loan Documents.
 
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(c)           The powers conferred on Lender hereunder are solely to protect its interest in the Collateral and shall not impose any duty upon it to exercise any such powers.  Except for the safe custody of any Collateral in its possession and the accounting for moneys actually received by it hereunder, Lender shall have no duty as to any Collateral or as to the taking of any necessary steps to preserve rights against prior parties or any other rights pertaining to any Collateral.
 
SECTION 7.   Remedies Upon Default .  If any Event of Default shall have occurred and be continuing:
 
(a)           Lender may exercise in respect of the Collateral, in addition to any other rights and remedies provided for herein or otherwise available to it, all of the rights and remedies of a secured party upon default under the Code (whether or not the Code applies to the affected Collateral), and also may (i) take absolute control of the Collateral, including, without limitation, transfer into Lender’s name or into the name of its nominee or nominees (to the extent Lender has not theretofore done so) and thereafter receive, for the benefit of Lender, all payments made thereon, give all consents, waivers and ratifications in respect thereof and otherwise act with respect thereto as though it were the outright owner thereof, (ii) without notice except as specified below and without any obligation to prepare or process the Collateral for sale, sell the Collateral or any part thereof in one or more parcels at public or private sale, at any of Lender’s offices or elsewhere, for cash, on credit or for future delivery, and at such price or prices and upon such other terms as Lender may deem commercially reasonable.  All Cash Proceeds received by Lender in respect of any sale of or collection from, or other realization upon, all or any part of the Collateral may, in the discretion of Lender, be held by Lender as collateral for, and/or then or at any time thereafter applied (after payment of any amounts payable to Lender pursuant to Section 8 hereof) in whole or in part by Lender against, all or any part of the Obligations in such order as Lender shall elect, consistent with the provisions of the Credit Agreement and the Intercreditor Agreements.  Any surplus of such cash or Cash Proceeds held by Lender and remaining after the indefeasible payment in full of all of the Obligations after the termination of the Credit Agreement and the other Loan Documents shall be paid over to whomsoever shall be lawfully entitled to receive the same or as a court of competent jurisdiction shall direct.
 
(b)           In the event that the proceeds of any such sale, collection or realization are insufficient to pay all amounts to which Lender is legally entitled, the Company shall be liable for the deficiency, together with interest thereon at the highest rate specified in any applicable Loan Document for interest on overdue principal thereof or such other rate as shall be fixed by applicable law, together with the costs of collection and the reasonable fees, costs, expenses and other client charges of any attorneys employed by Lender to collect such deficiency.
 
(c)           The Company hereby acknowledges that if Lender complies with any applicable state or federal law requirements in connection with a disposition of the Collateral, such compliance will not adversely effect the commercial reasonableness of any sale or other disposition of the Collateral.
 
 
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SECTION 8.  Indemnity and Expenses .
 
(a)           The Company agrees to defend, protect, indemnify and hold Lender harmless from and against any and all claims, damages, losses, liabilities, obligations, penalties, fees, costs and expenses (including, without limitation, reasonable legal fees, costs, expenses, and disbursements of Lender’s counsel) to the extent that they arise out of or otherwise result from this Agreement (including, without limitation, enforcement of this Agreement), except claims, losses or liabilities resulting solely and directly from Lender’s gross negligence or willful misconduct, as determined by a final judgment of a court of competent jurisdiction.
 
(b)           The Company will upon demand pay to Lender the amount of any and all costs and expenses, including the reasonable fees, costs, expenses and disbursements of counsel for Lender and of any experts of Lender (including, without limitation, any collateral trustee which may act as agent of Lender), which Lender may incur in connection with (i) the preparation, negotiation, execution, delivery, recordation, administration, amendment, waiver or other modification or termination of this Agreement, (ii) the custody, preservation, use or operation of, or the sale of, collection from, or other realization upon, any Collateral, (iii) the exercise or enforcement of any of the rights of Lender hereunder, or (iv) the failure by the Company to perform or observe any of the provisions hereof.
 
SECTION 9.  Notices, Etc.   All notices and other communications provided for hereunder shall be in writing and shall be mailed (by certified mail, postage prepaid and return receipt requested), telecopied or delivered, if to the Company or to Lender, to it at its address specified in the Credit Agreement; or as to any such Person, at such other address as shall be designated by such Person in a written notice to such other Person complying as to delivery with the terms of this Section 9.  All such notices and other communications shall be effective (i) if mailed (by certified mail, postage prepaid and return receipt requested), when received or three (3) Business Days after deposited in the mails, whichever occurs first, (ii) if telecopied, when transmitted and confirmation is received, provided same is on a Business Day and, if not, on the next Business Day; or (iii) if delivered, upon delivery, provided same is on a Business Day and, if not, on the next Business Day.
 
SECTION 10.  Miscellaneous .
 
(a)           No amendment of any provision of this Agreement shall be effective unless it is in writing and signed by the Company and Lender, and no waiver of any provision of this Agreement, and no consent to any departure by the Company therefrom, shall be effective unless it is in writing and signed by Lender, and then such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given.
 
(b)           No failure on the part of Lender to exercise, and no delay in exercising, any right hereunder or under any other Loan Document shall operate as a waiver thereof; nor shall any single or partial exercise of any such right preclude any other or further exercise thereof or the exercise of any other right.  The rights and remedies of Lender in the other Loan Documents are cumulative and are in addition to, and not exclusive of, any rights or remedies provided by law.  The rights of Lender against any party thereto are not conditional or contingent on any attempt by such Person to exercise any of its rights under any other Loan Document against such party or against any other Person, including but not limited to, the Company.
 
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(c)           Any provision of this Agreement which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining portions hereof or thereof or affecting the validity or enforceability of such provision in any other jurisdiction.
 
(d)           This Agreement shall create a continuing security interest in the Collateral and shall (i) remain in full force and effect until the later of (A) the indefeasible payment in full of the Obligations and (B) the termination of the Credit Agreement and the other Loan Documents and (ii) be binding on the Company and all other Persons who become bound as debtor to this Agreement in accordance with Section 9-203(d) of the Code and shall inure, together with all rights and remedies of Lender and the Lender hereunder, to the benefit of Lender and the Lender and their respective permitted successors, transferees and assigns.  Without limiting the generality of clause (ii) of the immediately preceding sentence, without notice to the Company, Lender may assign or otherwi se transfer their rights and obligations under this Agreement and any other Loan Document, to any other Person and such other Person shall thereupon become vested with all of the benefits in respect thereof granted to Lender and the Lender herein or otherwise.  Upon any such assignment or transfer, all references in this Agreement to Lender shall mean the assignee of Lender.  None of the rights or obligations of the Company hereunder may be assigned or otherwise transferred without the prior written consent of Lender, and any such assignment or transfer shall be null and void.
 
(e)           Upon the satisfaction in full of the Obligations and the termination of the Credit Agreement and the other Loan Documents, (i) this Agreement and the security interests created hereby shall terminate and all rights to the Collateral shall revert to the Company and (ii) Lender will, upon the Company’s request and at the Company’s expense, (A) return to the Company such of the Collateral as shall not have been sold or otherwise disposed of or applied pursuant to the terms hereof and (B) execute and deliver to the Company such documents as the Company shall reasonably request to evidence such termination, all without any representation, warranty or recourse whatsoever.
 
(f)           THIS AGREEMENT SHALL BE GOVERNED BY, CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF CALIFORNIA, EXCEPT AS REQUIRED BY MANDATORY PROVISIONS OF LAW AND EXCEPT TO THE EXTENT THAT THE VALIDITY AND PERFECTION OR THE PERFECTION AND THE EFFECT OF PERFECTION OR NON-PERFECTION OF THE SECURITY INTEREST CREATED HEREBY, OR REMEDIES HEREUNDER, IN RESPECT OF ANY PARTICULAR COLLATERAL ARE GOVERNED BY THE LAW OF A JURISDICTION OTHER THAN THE STATE OF CALIFORNIA.
 
(g)           ANY LEGAL ACTION, SUIT OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY DOCUMENT RELATED THERETO MAY BE BROUGHT IN THE COURTS OF THE STATE OF CALIFORNIA IN THE COUNTY OF LOS ANGELES, AND, BY EXECUTION AND DELIVERY OF THIS AGREEMENT, THE COMPANY HEREBY ACCEPTS FOR ITSELF AND IN RESPECT OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, THE JURISDICTION OF THE AFORESAID COURTS.  THE COMPANY HEREBY EXPRESSLY AND IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION, INCLUDING, WITHOUT LIMITATION, ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY SUCH ACTION, SUIT OR PROCEEDING IN SUCH RESPECTIVE JURISDICTIONS AND CONSENTS TO THE GRANTING OF SUCH LEGAL OR EQUITABLE RELIEF AS IS DEEMED APPROPRIATE BY THE COURT.
 
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(h)           THE COMPANY AND (BY ITS ACCEPTANCE OF THE BENEFITS OF THIS AGREEMENT) LENDER WAIVES ANY RIGHT IT MAY HAVE TO TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED ON, ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, VERBAL OR WRITTEN STATEMENT OR OTHER ACTION OF THE PARTIES HERETO.
 
(i)            The Company irrevocably consents to the service of process of any of the aforesaid courts in any such action, suit or proceeding by the mailing of copies thereof by registered or certified mail (or any substantially similar form of mail), postage prepaid, to the Company at its address provided herein, such service to become effective 10 days after such mailing.
 
(j)            Nothing contained herein shall affect the right of Lender to serve process in any other manner permitted by law or commence legal proceedings or otherwise proceed against the Company or any property of the Company in any other jurisdiction.
 
(k)           The Company irrevocably and unconditionally waives any right it may have to claim or recover in any legal action, suit or proceeding referred to in this Section any special, exemplary, punitive or consequential damages.
 
(l)            Section headings herein are included for convenience of reference only and shall not constitute a part of this Agreement for any other purpose.
 
(m)          This Agreement may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which shall be deemed to be an original, but all of which taken together constitute one in the same Agreement.
 
(n)           All of the obligations of the Company hereunder are joint and several.  Lender may, in its sole and absolute discretion, enforce the provisions hereof against any of the Company and shall not be required to proceed against the Company or seek payment from the Company.  In addition, Lender may, in its sole and absolute discretion, select the Collateral of any one or more of the Company for sale or application to the Obligations, without regard to the ownership of such Collateral, and shall not be required to make such selection ratably from the Collateral owned by all of the Company.
 
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IN WITNESS WHEREOF, the Company has caused this Agreement to be executed and delivered by its officer thereunto duly authorized, as of the date first above written.
 
 
INTERNET MEDIA SERVICES, INC
   
 
By: /s/ Michael Buechler
 
Name: Michael Buechler
 
Title:  Executive Vice President and Secretary
 
 
 
 
 
 
 
 
 
 

 
 
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EX-10.5 6 ex10-5.htm ex10-5.htm
Exhibit 10.5
 
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY APPLICABLE STATE LAW, AND MAY NOT BE SOLD, OFFERED FOR SALE, DISTRIBUTED, ASSIGNED, OFFERED, PLEDGED OR OTHERWISE TRANSFERRED UNLESS (A) THERE IS AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT AND APPLICABLE STATE, OR FOREIGN SECURITIES LAWS COVERING ANY SUCH TRANSACTION OR (B) SUCH TRANSACTION IS EXEMPT FROM REGISTRATION.
 
SECURED PROMISSORY NOTE


$64,744 April 8, 2010
Santa Monica, CA
 
FOR VALUE RECEIVED, INTERNET MEDIA SERVICES INC. (the “Borrower”), promises to pay to RAYMOND MEYERS (the “Lender”), or to its order, the principal sum of Sixty-Four Thousand, Seven-Hundred, and Forty-Four U.S. DOLLARS ($64,744) (the “Principal Amount”), together with interest in arrears on the unpaid principal balance from time to time outstanding from the date hereof until the entire principal amount due hereunder is paid in full at the rate(s) provided below.
 
This Secured Promissory Note (this “Note”) is one of a series of Secured Promissory Notes in the aggregate principal of up to $200,000 containing substantially identical terms and conditions (the “Notes”) issued by the Borrower to the Lender on behalf of the Lenders.  The Notes are pari passu such that all Notes are ranked equally, and no payments shall be made by the Borrower under any of the Notes unless a pro rata payment is simultaneously made under all other Notes.  Terms not defined herein shall have the meaning ascribed to them in that certain Credit Agreement, dated April 8, 2010, between the Lender and the Borrower.
 
Subject to applicable law, the Notes will be senior in all respects (including the right of payment) to all other indebtedness of the Borrower now existing or hereafter incurred.
 
1.          Maturity.  The aggregate Principal Amount, together with all accrued interest thereon and expenses incurred by the Lender in connection herewith (cumulatively, the “Outstanding Amount”), shall be due and payable in full on the earliest to occur of (the earliest of such events, the “Maturity Date”): (i) April 8, 2011 (the “Scheduled Maturity Date”) and (ii) the acceleration of this Note upon the occurrence of an Event of Default.  U nless payment is made following a demand therefor by the Lender, the Borrower shall provide the Lender with not less than five (5) business days’ prior written notice of its intent to repay the amounts outstanding hereunder.
 
2.           Interest.  This Note shall bear interest at a rate of six percent (6%) in excess of the then in effect one-year LIBOR rate per annum.  Interest shall be calculated on the basis of a year of 360 days for the actual number of days elapsed.  All accrued interest on this Note shall be due and payable on the first day of each calendar quarter commencing with the first calendar quarter following the disbursement of any Revolving Credit Loan.  From and after the occurrence of an Event of Default, the unpaid principal balance of this Note and, to the extent permitted by law, overdue interest shall bear interest at a rate per annum equal to four (4%) percent over the then applicable interest rate due under each Loan (the “Default Rate”).
 
 
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3.           Payment; Usury.  All payments by the Borrower under this Note shall be made in United States Dollars without deduction, set-off or counterclaim and shall be free and clear and without any deduction or withholding for any taxes or fees of any nature whatever, unless the obligation to make such deduction or withholding is required by law.  Payment shall be credited first to the accrued interest then due and payable and the remainder applied to principal.  Unless otherwise expressly provided in this Note, the Borrower, to the extent permitted by applicable law, waives presentment for payment, protest, and demand, and notice of protest, demand, a nd/or dishonor and nonpayment of this Note, notice of any Event of Default under this Note, and all other notices or demands otherwise required by law that the Borrower may lawfully waive.  All agreements between the Borrower and the Lender are hereby expressly limited so that in no contingency or event whatsoever, whether by reason of acceleration of maturity of the indebtedness evidenced hereby or otherwise, shall the amount paid or agreed to be paid to the Lender for the use, forbearance, or detention of the indebtedness evidenced hereby exceed the maximum permissible amount under applicable law.  If, from any circumstance whatsoever, fulfillment of any provision hereof at the time performance of such provision shall be due shall involve transcending the limit of validity prescribed by law, the obligation to be fulfilled shall automatically be reduced to the limit of such validity, and if from any circumstances the Lender should ever receive as interest an amount which would exceed the highest lawful rate, such amount which would be excessive interest shall be applied to the reduction of the principal balance evidenced hereby and not to the payment of interest, and, if the principal amount of this Note has been paid in full, shall be refunded to the Borrower.
 
Immediately upon full repayment or conversion of the Outstanding Amount in accordance with the terms hereof, the Borrower shall be released from the repayment obligation or the conversion obligation set forth in this Note, the pledge and security interest shall be terminated, and the Lender shall execute releases of financing statements.
 
4.           Security Interest and Collateral.  This Note is secured by a first priority security interest on the Collateral pursuant to the terms of the Security Agreement, of even date hereof, made by the Borrower in favor of the Lender (the “Security Agreement”).
 
5.           Replacement of Note.  If this Note is mutilated, lost, stolen or destroyed, the Borrower shall issue or cause to be issued in exchange and substitution for and upon cancellation hereof, or in lieu of and substitution for this Note, a new Note, but only upon receipt of evidence reasonably satisfactory to the Borrower of such loss, theft or destruction and customary and reasonable bond or indemnity, if requested.
 
6.           Miscellaneous.
 
(a)      Authority and Enforceability; Etc.  The Borrower hereby represents and warrants to the Lender that:
 
(i)  it has full power and authority and has taken or shall take all required corporate and other action necessary to permit it to execute, deliver, and perform all of its obligations contained in this Note, the Security Agreement, and any other documents or instruments delivered in connection herewith, and to borrow hereunder, and such actions to the best of its knowledge will not violate any provision of law applicable to, or the organizational documents of, the Borrower, or result in the breach of or constitute a default under any material agreement or instrument to which the Borrower is a party or by which it is bound, which default has not been waived in writing on or prior to the date hereof;
 
 
-2-

 
(ii)  this Note has been duly authorized and validly executed by and is the valid and binding obligation of the Borrower enforceable in accordance with its terms, except as enforceability may be limited by bankruptcy, insolvency, reorganization, or other laws affecting creditors’ rights and remedies generally, and by general principles of equity (regardless of whether enforceability is considered in a proceeding in equity or at law);
 
(iii)  neither the execution and delivery by the Borrower of this Note, nor the performance by the Borrower of its obligations hereunder, requires the consent, approval or authorization of any person or governmental authority, which consent, approval, or authorization has not been obtained; and
 
(b)       Notices.  All notices to any party required or permitted hereunder shall be in writing and shall be sent to the address or facsimile number set forth for such party as follows:
 
(i)
If to the Lender:
   
 
Raymond Meyers
 
1434 6th Street, Unit 9
 
Santa Monica, CA 90401
(ii)
If to Company:
   
 
Internet Media Services, Inc.
 
1434 6th Street, Unit 9
 
Santa Monica, CA 90401

Any such notice shall be deemed effectively given (i) upon personal delivery to the party to be notified; (ii) when sent by confirmed facsimile if sent during normal business hours of the recipient, if not, then on the next business day; (iii) three days after having been sent by registered or certified mail, return receipt requested, postage prepaid; or (iv) one day after deposit with a recognized national overnight courier, specifying next day delivery, or two days after deposit with a recognized international overnight courier, specifying two day delivery, in each case with written verification of receipt.

(c)      Waiver.  No failure to exercise, and no delay in exercising, on the part of the Lender, any right, power, or privilege hereunder shall operate as a waiver thereof; nor shall any single or partial exercise of any right, power, or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, power, or privilege.  The rights and remedies herein provided are cumulative and not exclusive of any rights or remedies provided by law.
 
 
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(d)      Amendments.  Any term, covenant, or condition of this Note may be amended or waived only by written consent of the Borrower and the Lender.
 
(e)      Expenses.  Any reasonable expense incurred by the Lender (including, without limitation, reasonable attorneys’ fees and disbursements) in connection with the administration, or enforcement of this Note and any other document executed by the Borrower in connection with the obligations of Borrower hereunder or any amendment hereto or thereto, or the exercise of any right or remedy upon the occurrence of an Event of Default, including, without limitation, the recording and filing fees to perfect the liens granted under the Security Agreement and the costs of collection and reasonable attorneys’ fees and expenses, shall be paid by the Borrower within 15 days of receiving written not ice thereof from the Lender.  Any such expense incurred by the Lender and not timely paid by the Borrower shall be added to the other obligations hereunder and shall earn interest at the same rate per annum as the principal hereunder.
 
(f)      Governing Law.  This Note shall be governed by and construed in accordance with the laws of the State of California without giving effect to any conflict or choice of laws principles.
 
(g)      Transfer; Successors and Assigns.  The terms and conditions of this Note shall inure to the benefit of and be binding upon the respective successors and assigns of the parties. This Note shall not be assignable by any Lender without the prior written consent of the Borrower, provided that the Lender may assign or transfer any of its rights, privileges, or obligations set forth in, arising under, or created by this Agreement to any entity controlled by, controlling or under common control with the Lender. The Borrower may not assign this Note without prior written consent of the Lender, provided that the Borrower may assign this Note to any successor of all or substantially all of its assets or business, or any entity surviving the merger, combination or consolidation with the Borrower.
 
(h)      Entire Agreement.  This Note and any other agreement or instrument entered into in connection herewith contains the entire agreement of the Borrower and the Lender with respect to the subject matter hereof.
 
(i)       Confidentiality.  In addition to separate confidentiality agreement, if any, each Lender will at all times keep confidential and not divulge, use or make accessible to anyone the terms and conditions of this Agreement and the transactions described herein, and any non-public material information concerning or relating to the business or financial affairs of the Borrower to which such party has been or will become privy relating to this Agreement, except to its employees and advisors in such capacity, as required to perform its obligations hereunder, if required by law or rules of a stock exchange on which its or its parent’s securities are listed, or with the prior written consent of the Borrower.
 

 
-4-

 
 
 
IN WITNESS WHEREOF, the Borrower has caused this Note to be executed by its duly authorized representative as of the day and year first above written.
 
 
INTERNET MEDIA SERVICES, INC
   
 
By: /s/ Michael Buechler
 
Name: Michael Buechler
 
Title:   Executive Vice President and Secretary

 
 
 
 
 
 
 
 
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EX-23.1 7 ex23-1.htm ex23-1.htm
Exhibit 23.1


CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM


We consent to the use in this Registration Statement (No. 333-165972) on Amendment No. 1 to Form S-1 of our report dated April 9, 2010, except for items disclosed in Note 1 regarding restatement, as to which the date is June 30, 2010, relating to our audit of the restated consolidated financial statements of Internet Media Services, Inc. for the year ended December 31, 2009, our report dated June 30, 2010 related to our audit of the  carve out financial statements of Legalstore.com (a division of Document Security Systems, Inc.) for the period from January 1, 2009 to October 8, 2009 and our report dated December 11, 2009 related to our audits of the carve out financial statements of Legalstore.com (a division of Document Security Systems, Inc.) for the years ended  December 31, 2007 and 2008 appearing in the P rospectus, which is part of this Registration Statement.

We also consent of the reference to our firm under the caption “Experts” in such Prospectus.

/s/ FREED MAXICK & BATTAGLIA, CPAs, PC

Buffalo, New York
June 30, 2010
 
 
 
 
 

 
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