-----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, Vrfs2KmKqMSLjYcTfZhibGmPE0FMaTOBX9p4y8t+DwMyPQKkyDluOUlF9ev25n6g AjLjRo4x/MTFWGbORv091w== 0000722839-99-000014.txt : 19990208 0000722839-99-000014.hdr.sgml : 19990208 ACCESSION NUMBER: 0000722839-99-000014 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 6 CONFORMED PERIOD OF REPORT: 19990121 ITEM INFORMATION: ITEM INFORMATION: ITEM INFORMATION: FILED AS OF DATE: 19990205 FILER: COMPANY DATA: COMPANY CONFORMED NAME: PROACTIVE TECHNOLOGIES INC CENTRAL INDEX KEY: 0000722839 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-MEDICAL LABORATORIES [8071] IRS NUMBER: 232265039 STATE OF INCORPORATION: DE FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 001-08662 FILM NUMBER: 99522935 BUSINESS ADDRESS: STREET 1: 7118 BEECH RIDGE TRAIL STREET 2: STE 402 CITY: TALLAHASSEE STATE: FL ZIP: 32312 BUSINESS PHONE: 9046685800 MAIL ADDRESS: STREET 1: 7118 BEECH RIDGE TRAIL STREET 2: SUITE 402 CITY: TALLAHASSEE STATE: FL ZIP: 32312 FORMER COMPANY: FORMER CONFORMED NAME: KEYSTONE MEDICAL CORPORATION DATE OF NAME CHANGE: 19920703 FORMER COMPANY: FORMER CONFORMED NAME: KEYSTONE MEDICAL CORP INC DATE OF NAME CHANGE: 19910103 8-K 1 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K Current Report Pursuant to Section 13 or 15(d) Under the Securities Exchange Act of 1934 Date of Report February 5, 1999 _________________ Commission File Number 1-8662 PROACTIVE TECHNOLOGIES, INC. (formerly KEYSTONE MEDICAL CORPORATION) (Exact name of registrant as specified in its charter) Delaware 23-2265039 (State of Incorporation) (IRS Employer Identification No.) 7118 Beech Ridge Trail Tallahassee, Florida 32312 (Address of Principal Executive Offices) (Zip Codes) Registrant's telephone number, including area code: (850) 668-8500 _______________________________________________________________________ Item 1. Changes in Control of Registrant If and to the extent that Mark A. Conner's beneficial ownership of 8,559,077 shares of Common Stock and his position as President and Chairman of the Board represented control of Proactive Technologies, Inc. (the "Registrant"), the sale by Mr. Conner to the Registrant of 5,000,000 shares of common stock of the Registrant, as reported in Item 2. below, taken together with his resignation as an officer and director of the Registrant, may represent a change in control of the Registrant. Mr. Conner now beneficially owns 17.2% of the issued and outstanding shares of common stock of the Registrant. He has expressed a willingness to sell the remainder of his shares. Since Mr. Conner's shares were sold to the Registrant, persons who had previously acquired shares now own a greater percentage of the Registrant. As noted, Mr. Conner resigned as a director and officer of the Registrant. On February 2, 1999, the directors elected William Astrop as a director to fill the vacancy created by Mr. Conner's resignation. As previously reported by the Registrant on Form 8-K filed January 19, 1999, and incorporated herein by reference on December 30, 1998, Arthur G. Weiss and certain members of his family acquired the right to receive an aggregate of 3,100,000 shares of the Registrant's Common Stock pursuant to the terms of that certain Agreement and Plan of Reorganization ("Weiss Reorganization Agreement") dated December 28, 1998. As a result of the Conner stock sale, Mr. Weiss now beneficially owns 15.0% of the issued and outstanding shares of common stock of the Registrant. As previously reported on Form 8-K dated January 25, 1999, and incorporated herein by reference, on January 8, 1999, the Lance Children's Trust (the "Trust"), a trust for the benefit of the children of Mr. Beverly Lance, acquired 3,600,00 shares (the "Shares") of the Registrant's Common Stock pursuant to the terms of that certain Agreement and Plan of Reorganization ("Lance Reorganization Agreement"), dated January 8, 1999 between the Registrant and the Trust. As a result of the Conner stock sale, Mr. Lance now beneficially owns 17.4% of the issued and outstanding shares of Common Stock of the Registrant. On January 29, 1999, the Wendell M. Starke Trust ("Starke Trust") acquired 2,500,000 shares of the Registrant's Common Stock for $1,000,000 in cash from personal funds. Wendell M. Starke is the Trustee and Beneficiary of the Starke Trust. As a result of the Conner stock sale, Mr. Starke now owns 12.1% of the issued and outstanding shares of Common Stock of the Registrant. The preceding transactions were not subject to or conditioned on the occurrence of any of the other transactions. On February 5, 1999, Ben S. Branch and Robert E. Maloney, Jr. resigned as directors of the Registrant. The resignations of Mr. Branch and Mr. Maloney were not the subject of any prior arrangement or understanding. As previously noted in the Schedule 13D filed by Mr. Lance and the Trust, they intend to seek representation on the Registrant's Board of Directors. Accordingly, Mr. Lance will seek nomination to fill one of the vacancies on the Board. The above-referenced persons have not had any formal arrangements or understandings with respect to other changes in the Registrant, but Mr. Weiss and Mr. Lance are working together with management to develop a comprehensive plan to attempt to improve the Registrant's financial performance. Item 2. Disposition of Assets On January 21, 1999, the Registrant closed the sale of its wholly- owned subsidiary, Henry Holdings, Inc., a Florida corporation (the "Subsidiary") to Mark A. Conner, the Registrant's former President, in exchange for 5,000,000 shares of Common Stock of the Registrant that were held by Mr. Conner. Under the terms of the Agreement, Conner was to receive cash or cash and property with an agreed upon value of not greater than $2,000,000. At January 21, 1999, the Subsidiary, a real estate holding company had an asset of $700,000 in cash. The remaining value of $1,300,000 was to be generated from the closing of a contract with an unrelated third party purchaser or by conveyance via warranty deed to Henry Holdings, Inc. on January 28, 1999 in the event that the third party purchasers did not close on the land, of the following real estate holdings: 38 lots in The Landings at Golden Eagle Phase I; 39 developed lots in Golden Eagle Units 5 & 7; 40 developed lots in Golden Eagle Unit 8; raw land for The Landings at Golden Eagle Phase II; raw land for Golden Eagle Unit 6; and the office building and land located at 7118 Beech Ridge Trail, Tallahassee, Florida. The above real estate holdings were subject to approximately $3,667,500 in mortgage indebtedness, which was to be paid off at closing, or assumed by Mr. Conner, if the transaction to the third party purchasers did not occur. The transaction closed to the third party purchasers on January 28,1999. The assets sold by the Registrant had a book value of $6,396,416.33 as of December 31, 1998 and were sold at a contract price of $5,112,902. The actual cash paid for the 5,000,000 shares of stock was $1,570,000.00, with an additional $200,000 held in escrow to be released upon the fulfillment of certain continigencies by Mr. Conner. The sale was made pursuant to a Stock Exchange Agreement, filed as Exhibit 2.1. The purchase price was set based upon the written offer to purchase that the Registrant received from the unrelated third party purchasers. In connection with this sale, Mr. Conner resigned as President of the Registrant and the Registrant and Mr. Conner entered into a Consulting Agreement, an Indemnification Agreement and a Profit Sharing Agreement, each of which is filed as an Exhibit hereto. Further information regarding this transaction is included in the Registrant's press release, filed as Exhibit 99.1 and incorporated herein by this reference. The Profit Sharing Agreement provided that, in the event that (i.) the third party purchaser did not close on the above transaction, and (ii.) the property was conveyed by warranty deed to Henry Holdings, Inc., and (iii.) Mr. Conner agreed that if he sold the property within 67 days of January 21, 1999, then he would pay any amounts received in excess of $1,300,000, over and above all closing costs and encumbrances, to the Registrant. The property closed to the third party purchaser on January 28, 1999. The Profit Sharing Agreement will terminate without any payment. Item 3. Bankruptcy or Receivership Not Applicable Item 4. Changes in Registrant's Certifying Accountant Not Applicable Item 5. Other Events Not Applicable Item 6. Resignations of Registrant's Directors Not Applicable Item 7. Financial Statements and Exhibits (a) Financial Statements. Not Applicable (b) Unaudited Pro Forma Condensed Consolidated Financial Information. Set forth below are thefollowing unaudited pro forma condensed consolidated financial statements: 1. Introduction to Condensed Consolidated Pro Forma Financial Statements. 2. Pro Forma Condensed Consolidated Statements of Income for the Year Ended June 30, 1998 and the Three Months Ended September 30, 1998. 3. Pro Forma Condensed Consolidated Balance Sheet as of September 30, 1998. Unaudited Pro Forma Condensed Consolidated Financial Information Introductory Note: The following unaudited pro forma condensed balance sheet and statements of income reflect the financial position at September 30, 1998 and results of operations for the year ended June 30, 1998 and the three months ended September 30, 1998 of Proactive Technologies, Inc. (the "Registrant" or the "Company") as if the disposition of the assets on January 21, 1999 had occurred on September 30, 1998 for balance sheet purposes and July 1, 1997 for statement of income purposes. The unaudited pro forma condensed consolidated balance sheet and statement of income do not purport to represent the Registrant's financial position or results of operations had the transactions actually occurred on September 30, 1998 or July 1, 1997, respectively, or to project the Registrant's consolidated results of operations for any future periods. The pro forma adjustments are based upon available information. These adjustments are directly attributable to the transaction referred to above, and are expected to have a continuing impact on the Registrant's business, results of operations and financial position. The following unaudited pro forma condensed consolidated financial statements should be read in conjunction with the historical financial statements of the Registrant, which are included in its Form 10-KSB for the year ended June 30, 1998 and its Form 10-QSB for the three months ended September 30, 1998. Proactive Technologies, Inc. Proforma Condensed Consolidated Statement of Income Year Ended June 30, 1998 (in 000's) Proactive Pro Forma Technologies, Inc. Pro Forma Consolidated Year Ended Adjustments Year Ended 06/30/98 06/30/98 ------------------ -------------- -------------- Sales (A) $ 15,134 $ 5,113 $ 20,247 Cost of Sales (B) 11,888 6,507 18,395 ------------- -------------- --------------- Gross Profit 3,246 (1,394) 1,852 Selling, general and administrative exp. (C) ( 2,787) 8 (2,779) Interest expense (D) ( 1,270) 194 (1,076) Equity in earnings of affiliated companies 21 0 21 Minority interest 0 0 0 Loss on attempted acquisition of Killearn (369) 0 ( 369) Other income, net 177 0 177 ------------- --------------- -------------- (Loss) income before income taxes and discontinued operations (982) (1,192) (2,174) Income tax benefit (expense) (E) 332 405 737 ------------- --------------- --------------- Net (loss) income before discontinued operations (650) ( 787) (1,437) Discontinued operations: Loss from investment in Decocrete (less applicable benefit of $138,801 (230) 0 ( 230) -------------- --------------- --------------- Net (loss) income $ (880) ( 787) (1,667) (Loss) earnings per share before discontinued operations ($ 0.04) ($ 0.14) Discontinued operations ($ 0.01) ($ 0.01) -------------- --------------- (Loss) earnings per share ($ 0.05) ($ 0.15) Weighted average shares outstanding 16,845,746 11,845,746
(A) Reflect sale of properties (B) Reflect cost of properties sold and closing costs (C) Eliminate selling and marketing expenses associated with the properties (D) Eliminate interest expense to reflect the assumption of bank borrowings (E) Income tax benefit related to the above transactions at the Company's effective income tax rate (34%). Proactive Technologies, Inc. Pro Forma Condensed Consolidated Statement of Income Three Months Ended September 30, 1998 (Unaudited) (In 000's) Proactive Pro Forma Technologies, Inc. Consolidated Three Months Pro Forma Three Months Ended 9/30/98 Adjustments Ended 9/30/98 ------------------- ------------- ---------------- REVENUES: Net Sales (A) $ 1,327 $ 5,113 $ 6,440 Cost of Sales (B) 1,389 6,507 7,896 Selling, general and administrative exp. (C) 454 ( 1) 453 -------------- ------------- -------------- (Loss) income from operations ( 516) (1,393) (1,909) Other income (deductions): Interest (expense) (D) ( 138) 48 ( 90) Other income, net 120 0 120 Minority interest 0 0 0 -------------- ------------- -------------- (Loss) income from continuing operations before income taxes ( 534) (1,345) (1,879) Income tax benefit (E) 186 457 643 -------------- ------------- -------------- Net (loss) income before discontinued operations ($ 348) ($ 888) ($ 1,236) Discontinued operations: Loss from operations of Decocrete Worldwide, less applicable tax benefit of 0 0 0 --------------- -------------- -------------- Net (loss) income ($ 348) ($ 888) ($ 1,236) --------------- -------------- -------------- (Loss) earnings per share before discontinued operations ($ 0.02) ( $ 0.11) Discontinued operations $ 0.00 $ 0.00 --------------- -------------- Earnings per share ($ 0.02) ( $ 0.11) --------------- Adjusted shares outstanding primary and fully diluted 16,499,253 11,499,253 Dividends paid NONE NONE
(A) Reflect sale of properties (B) Reflect cost of properties sold and closing costs (C) Eliminate selling and marketing expenses associated with the properties (D) Eliminate interest expense to reflect the assumption of bank borrowings (E) Income tax benefit related to the above transactions at the Company's effective income tax rate (34%). Proactive Technologies, Inc. Pro Forma Condensed Consolidated Balance Sheet September 30, 1998 Proactive Consolidated Technologies, Inc. Pro Forma September 30, Pro Forma September 30, 1998 Adjustments 1998 ------------------ ---------------- ----------------- ASSETS: Real estate inventories (A) $ 33,449 ($ 6,161) $ 27,288 Cash and equivalents (B) 98 172 270 Property and equipt, net 393 (235) 158 Investment in Killearn 1,188 0 1,188 Other investments 197 0 197 Other assets 274 0 274 Notes receivable 1,055 0 1,055 -------------- --------------- --------------- Total Assets $ 36,654 ($ 6,224) $ 30,430 -------------- --------------- --------------- -------------- --------------- --------------- LIABILITIES AND STOCKHOLDERS' EQUITY: Notes payable (C) $ 21,095 ($ 3,634) $ 17,461 Accounts payable and accrued expenses (D) 1,096 700 1,796 Income taxes payable (E) 1,237 ( 457) 780 Deferred income tax liability 112 0 112 Deferred revenue 109 0 109 Deferred comp. payable 0 0 0 Customer deposits (F) 190 ( 175) 15 --------------- ---------------- -------------- Total liabilities $ 23,839 ($ 3,566) $ 20,273 Minority interest 0 0 0 Stockholders' Equity: Common Stock - par value $0.04 per share; authorized 60,000,000 shares; issued 17,092,657, (G) 684 (200) 484 Paid in capital (G) 12,328 (1,570) 10,758 Retained earnings 1,753 ( 888) 865 Treasury stock (1,950) 0 ( 1,950) ---------------- ---------------- ------------- Total stockholders' equity $ 12,815 ($ 2,658) $ 10,157 Total Liabilities and Stockholders' equity $ 36,654 ($ 6,224) $ 30,430 ---------------- ---------------- ------------- ---------------- ---------------- ------------- (A) Eliminate properties (B) Reflect net increase in cash due to sale of properties (C) Eliminate mortgages (D) Accrue liability for cash portion of stock purchases (E) Reflect accrual of taxes (F) Reflect reeturn of deposits (G) Repurchase of shares of common stock (c) Exhibits. Exhibit Number Description 2.1* Stock Exchange Agreement dated as of January 19, 1999 among Proactive Technologies, Inc. and Mark A. Conner 10.1 Consulting Agreement between Proactive Technologies, Inc. and Mark A. Conner 10.2 Indemnification Agreement between Proactive Technologies, Inc. and Mark A. Conner 10.3 Profit Sharing Agreement between Proactive Technologies, Inc. and Mark A. Conner 99.1 Press Release - 1/21/99 * In accordance with Item 601(b)(2) of Regulation S-K, the schedules have been omitted. There is a list of scedhules at the end of the Exhibit, briefly describing them. The Registrant will furnish supplementally a copy of any omitted schedule to the Commission upon request. Item 8. Change in Fiscal Year Not Applicable SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereto duly authorized. PROACTIVE TECHNOLOGIES, INC. Dated: February 5, 1999 /s/ Robert E. Maloney, Jr. By: _____________________________ Robert E. Maloney, Jr., Vice-President
EX-2.1 2 STOCK EXCHANGE AGREEMENT STOCK EXCHANGE AGREEMENT THIS STOCK EXCHANGE AGREEMENT ("Agreement") is entered into this _____ of January, 1999, by and among Proactive Technologies, Inc.., a Delaware corporation (hereinafter referred to as "Buyer"); and Mark Conner (hereinafter referred to as "Seller"). WHEREAS, Seller is the owner of record and beneficially owns Five Million (5,000,000) shares of the issued and outstanding shares of Common Stock of Proactive Technologies, Inc. (the "Shares"); and WHEREAS, Seller desires to sell all of the Shares to Buyer, and Buyer desires to purchase the Shares, upon the terms and conditions set forth herein, and WHEREAS, the parties intend that the exchange of Shares for shares of Seller's common stock, as contemplated herein, qualify as a tax free transaction under Section 368 of the Internal Revenue Code. NOW, THEREFORE, in consideration of the mutual promises and covenants contained herein, and for other good and valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged, the parties hereto agree as follows: I. SALE AND PURCHASE OF THE SHARES 1.1 Sale and Purchase. Subject to the terms and conditions hereof, at the Closing (as defined in paragraph 1.2 below), Seller agrees to sell, assign, transfer, convey and deliver to Buyer, and Buyer agrees to purchase from Seller, the Shares listed in Exhibit "A", attached hereto. 1.2 Closing. The purchase shall be consummated at a closing ("Closing") to take place at 11:00 o'clock a.m., at the offices of Seller's counsel on January ___, 1999 ("Closing Date"). 1.3 Purchase Price. The aggregate purchase price ("Purchase Price") for the Shares shall be One Hundred (100) shares of Henry Holdings, Inc., a Florida corporation ("Henry") common stock, attached hereto as Exhibit"B" which represents 100% of all the issued and outstanding shares of Henry. 1.4 Other Agreements. At the Closing, the indicated parties shall execute and deliver the following additional agreements in substantially the form attached hereto: (a) Stock certificates representing all of the Shares, duly endorsed to Buyer and in blank or assignments separate from the certificates, transferring the Shares from Seller to Buyer, copies of which are attached hereto as Exhibit "C". (b)Consulting Agreement between Buyer and Mark Conner attached hereto as Exhibit "D". (c)Resignation of Mark Conner as President and Director of Proactive Technologies, Inc. and all of its subsidiaries. (d)Mutual Release Agreement between Buyer and Seller attached hereto as Exhibit "E". (e)Indemnification Agreement attached hereto as Exhibit "F". (f)Profit Sharing Agreement attached hereto as Exhibit "G". 1.5 Basic Agreements and Transactions Defined. This Agreement and the other agreement listed in paragraph 1.4, are sometimes referred to as the "Basic Agreements". The transactions contemplated by the Basic Agreements are sometimes referred to as the "Transactions". II. REPRESENTATIONS AND WARRANTIES 2.1 Representations and Warranties of Seller. Seller represents and warrants to Buyer, with respect to the Shares owned by Seller, as follows: (a) Title to the Shares. Seller owns at Closing and of record and beneficially the number of the Shares listed in Exhibit "A", of the Company, free and clear of all liens, encumbrances, pledges, claims, options, charges and assessments of any nature whatsoever, with full right and lawful authority to transfer the Shares to Buyer. No person has any preemptive rights or rights of first refusal with respect to any of the Shares. There exists no voting agreement, voting trust, or outstanding proxy with respect to any of the Shares. There are no outstanding rights, options, warrants, calls, commitments, or any other agreements of any character, whether oral or written, with respect to the Shares. (b) Authorization of Transaction. The Seller has full power and authority (including, if the Seller is a corporation, full corporate power and authority) to execute and deliver the Basic Agreements and to perform his obligations thereunder. The Basic Agreements constitute a valid and legally binding obligation of the Seller, enforceable in accordance with its terms and conditions. The Seller need not give any notice to, make any filing with, or obtain any authorization, consent, or approval of any government or governmental agency in order to consummate the transactions contemplated by the Basic Agreements. (c)Brokers' Fees. The Seller has no liability or obligation to pay any fees or commissions to any broker, finder, or agent with respect to the transactions contemplated by this Agreement for which the Buyer could become liable or obligated. 2.2 Representations and Warranties of Buyer. Buyer represents and warrants to Seller as follows: (a) Organization. Buyer is a corporation duly incorporated, validly existing and in good standing under the laws of the state of Delaware. Buyer has all requisite corporate power and authority to complete this transaction and carry on its business. Buyer is duly qualified and in good standing with the State of Delaware. (b) Authorization of Transaction. The Buyer has full power and authority (including, if the Buyer is a corporation, full corporate power and authority) to execute and deliver the Basic Agreements and to perform his obligations thereunder. The Basic Agreements constitute a valid and legally binding obligation of the Buyer, enforceable in accordance with its terms and conditions. The Buyer need not give any notice to, make any filing with, or obtain any authorization , consent, or approval of any government or governmental agency in order to consummate the transactions contemplated by the Basic Agreements. (c) Assets of Henry. which will have $700,000 in cash and Golden Eagle tract of property, which is currently under contract with the Hobbs group, Twin Action realty, and which consists of the following property: 38 lots in The Landing at Golden Eagle Phase I, 39 developed lots in Golden Eagle Units 5 & 7, 40 lots in Golden Eagle Unit 8, raw land for The Landings at Golden Eagle Phase II, raw land for Golden Eagle Unit 6, and the office building located at 7118 Beech Ridge Trail, Tallahassee, Florida. III. CONDITIONS PRECEDENT TO THE OBLIGATIONS OF BUYER TO CLOSE The obligation of Buyer to close the Transactions contemplated hereby is subject to the fulfillment by Seller prior to Closing of each of the following conditions, which may be waived in whole or in part by Buyer: 3.1 Compliance with Representations and Warranties . The representations and warranties of Seller contained in this Agreement shall have been true and correct when made and shall be true and correct as of the Closing with the same force and effect as if made at the Closing. Seller shall have performed all agreements, covenants and conditions required to be performed by Seller prior to the Closing. 3.2 No Legal Proceedings. No suit, action or other legal or administrative proceeding before any court or other governmental agency shall be pending or threatened seeking to enjoin the consummation of the Transactions contemplated hereby. 3.3 Documents to be Delivered by Seller. The Company and Seller shall have delivered the following documents: (a) Stock certificates representing all of the Shares, duly endorsed to Buyer and in blank or accompanied by duly executed stock powers, copies of which are attached as Exhibit "B". (b) Such other documents or certificates as shall be reasonably required by Buyer or its counsel in order to close and consummate this Agreement. IV. CONDITIONS PRECEDENT TO THE OBLIGATIONS OF SELLER TO CLOSE The obligation of Seller to close the Transactions is subject to the fulfillment prior to Closing of each of the following conditions, any of which may be waived in whole or in part by Seller: 4.1 Compliance with Representations, Warranties and Covenants. The representations and warranties made by Buyer in this Agreement shall have been true and correct when made and shall be true and correct in all material respects at the Closing with the same force and effect as if made at the Closing, and Buyer shall have performed all agreements, covenants and conditions required to be performed by Buyer prior to the Closing. 4.2 No Legal Proceedings. No suit, action or other legal or administrative proceedings before any court or other governmental agency shall be pending or threatened seeking to enjoin the consummation of the Transactions contemplated hereby. 4.3 Other Agreements. All parties other than Seller shall have executed and delivered the Basic Agreements. 4.4 Payments. Buyer shall deliver stock certificates to Seller representing all of the issued and outstanding shares of Henry Holdings, Inc. duly endorsed to Seller. At Closing, the Company shall execute two deeds to be held in escrow, one deeding the aforementioned Golden Eagle tract property to Twin Action Properties, Inc., pursuant to the existing contract, and another deeding the same property to Henry Holdings, Inc., a Florida corporation, which deed is to be recorded in the event that Twin Action does not consummate its transaction by January 28, 1999. 4.5 Assignment of Agreements. The Company agrees to assign both its agreement with the Golden Eagle Country Club and its agreement with Talquin Electric Cooperative to the party receiving the deed to the property at Closing. V. MODIFICATION, WAIVERS, TERMINATION AND EXPENSES 5.1 Modification. Buyer and Seller may amend, modify or supplement this Agreement in any manner as they may mutually agree in writing. 5.2 Waivers. Buyer and Seller may in writing extend the time for or waive compliance by the other with any of the covenants or conditions of the other contained herein. 5.3 Termination and Abandonment. This Agreement may be terminated and the purchase of the Shares may be abandoned before the Closing: (a) By the mutual consent of Seller and Buyer; (b) By Buyer, if the representations and warranties of Seller set forth herein shall not be accurate, or the conditions precedent set forth in Article III shall have not have been satisfied, in all material respects; or (c) By Seller, if the representations and warranties of Buyer set forth herein shall not be accurate, or the conditions precedent set forth in Article IV shall not have been satisfied in all material respects. Termination shall be effective on the date of receipt of written notice specifying the reasons therefor. VI. MISCELLANEOUS 6.1 Representations and Warranties to Survive. Unless otherwise provided, all of the representations and warranties contained in this Agreement and in any certificate, exhibit or other document delivered pursuant to this Agreement shall survive the Closing for a period of two (2) years. No investigation made by any party hereto or their representatives shall constitute a waiver of any representation or warranty, and no such representation or warranty shall be merged into the Closing. 6.2 Binding Effect of the Basic Agreements. The Basic Agreements and the certificates and other instruments delivered by or on behalf of the parties pursuant thereto, constitute the entire agreement between the parties. The terms and conditions of the Basic Agreements shall inure to the benefit of and be binding upon the respective heirs, legal representatives, successor and assigns of the parties hereto. Nothing in the Basic Agreements, expressed or implied, confers any rights or remedies upon any party other than the parties hereto and their respective heirs, legal representatives and assigns. Whenever Seller is authorized to act hereunder, any action authorized by members of Seller holding a majority of the Shares shall be deemed the act of and binding on all members of Seller. 6.3 Applicable Law. The Basic Agreements are made pursuant to, and will be construed under, the laws of the State of Florida. 6.4 Notices. All notices, requests, demands and other communications hereunder shall be in writing and will be deemed to have been duly given when delivered or mailed, first class postage prepaid: (a) If to Seller, to: Mark Conner 2500 Deerlake Road Tallahassee, FL 32312 Telephone: (850) 668-0083 (b) If to Buyer, to: Proactive Technologies, Inc. ATTN: Arthur Weiss 7118 Beech Ridge Trail Tallahassee, FL 32312 Telephone: (850) 668-8500 Fax: (850) 668-9100 These addresses may be changed from time to time by written notice to the other parties. 6.5 Headings. The headings contained in this Agreement are for reference only and will not affect in any way the meaning or interpretation of this Agreement. 6.6 Counterparts. This Agreement may be executed in counterparts, each of which will be deemed an original and all of which together will constitute one instrument. 6.7 Severability. If any one or more of the provisions of this Agreement shall, for any reason, be held to be invalid, illegal or unenforceable under applicable law this Agreement shall be construed as if such invalid, illegal or unenforceable provision had never been contained herein. The remaining provisions of this Agreement shall be given effect to the maximum extent then permitted by law. 6.8 Forbearance; Waiver. Failure to pursue any legal or equitable remedy or right available to a party shall not constitute a waiver of such right, nor shall any such forbearance, failure or actual waiver imply or constitute waiver of subsequent default or breach. 6.9 Attorneys' Fees and Expenses. The prevailing party in any legal proceeding based upon this Agreement shall be entitled to reasonable attorneys' fees and expenses and court costs. 6.10 Expenses. Each party shall pay all fees and expenses incurred by it incident to this Agreement and in connection with the consummation of all transactions contemplated by this Agreement. 6.11 Integration. This Agreement and all documents and instruments executed pursuant hereto merge and integrate all prior agreements and representations respecting the Transactions, whether written or oral, and constitute the sole agreement of the parties in connection therewith. This Agreement has been negotiated by and submitted to the scrutiny of both Seller and Buyer and their counsel and shall be given a fair and reasonable interpretation in accordance with the words hereof, without consideration or weight being given to its having been drafted by either party hereto or its counsel. IN WITNESS WHEREOF, the undersigned parties hereto have duly executed this Agreement on the date first written above. "BUYER" PROACTIVE TECHNOLOGIES, INC. By:________________________________ Arthur Weiss, Vice-President "SELLER" ___________________________________ Mark Conner List of Exhibits to Agreement: A Shares of Stock Owned by Seller B Outstanding Warrants, Options, Calls with regard to its Stock C Contracts and Agreements of the Company re Profits or Assets D Undisclosed Liabilities E Exceptions to Title F Insurance held by the Company G Transactions with Certain Persons H Material Contracts of the Company I Employment Matters of the Company J Authorizations of the Company L Outstanding Rights, Options, Warrants, Commitments etc. to Issue Shares of Buyer K Employment Matters of Buyer L Authorizations of Buyer EX-10.1 3 CONSULTING AGREEMENT CONSULTING AGREEMENT THIS AGREEMENT is made and entered into on this ___ day of January, 1999 by and between CAPITAL FIRST HOLDINGS, a Florida corporation, (hereinafter "Capital First") and MARK A. CONNER, a resident of the State of Florida (hereinafter "Conner"). W I T N E S S E T H WHEREAS, Conner has submitted his resignation as an officer and director of Capital First and its subsidiaries and has terminated his employment contract; and WHEREAS, Capital First desires to contract with Conner to provide consulting services to ensure a smooth transition with new management; and WHEREAS, Conner desires to provide such consulting services to Capital First. NOW, THEREFORE, in consideration of the mutual agreements contained herein and Ten Dollars ($10.00), the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows: 1.Appointment. Capital First hereby retains Conner to serve as a management consultant for Capital First, which services shall include assisting all personnel with transition into new management and continue to aid the Company with sales of real property. 2.Compensation. Capital First shall pay Conner for his services to be rendered a flat fee of $25,000.00, payable as follows: a.) $12,500.00 payable on February 1, 1999; and b.) $12,500.00 payable on March 1, 1999. 3.Independent Contractor. Conner shall be deemed an independent contractor for all purposes hereunder. Nothing contained herein shall be construed to make Conner a partner, employee, or agent of Capital First, nor shall either party have any authority to bind the other in any respect, it being intended that each shall remain independent contractors responsible for their own actions. 4.Manner of Performance. Without limiting the other provisions herein, Conner shall perform his duties hereunder pursuant to the following terms and conditions: A.Conner shall be furnished with and use Capital First's equipment and materials during the course of his performance hereunder; B.Conner shall be allowed to work from Capital First's Tallahassee office location, and exercise his own judgment as to the method and manner of his services; C.Conner shall not be prevented from engaging in other reasonable employment, provided, however, that such other employment does not create any conflict of interest hereunder; and D.Conner shall pay his own workman's compensation, unemployment compensation, insurance, social security and withholding and all other federal, state and local taxes or assessments and shall hold Proactive harmless therefrom. 5.Expenses. Capital First agrees to reimburse Conner for reasonable expenses associated with travel, postage and telephone incurred on behalf of Proactive. 6.Term. The term of this agreement shall commence on the ____ day of January, 1999 and shall continue until April 15, 1999. 7.Assignment. The agreement and the obligations hereunder may not be assigned by Conner without the express, prior written consent of Capital First. 8.Governing Law. This agreement shall be governed by and construed in accordance with the laws of the State of Florida. In WITNESS WHEREOF, the parties have execute this Consulting Agreement on the day and year first above written. "Capital First""Conner" CAPITAL FIRST HOLDINGS, INC., A Florida Corporation By:_____________________________ By:______________________________ Arthur G. Weiss, Vice-President Mark A. Conner EX-10.2 4 INDEMNIFICATION AGREEMENT INDEMNIFICATION AGREEMENT THIS AGREEMENT, is made this _____ day of January, 1999, by and between MARK A. CONNER, of 2500 Deer Lake Road, Tallahassee, FL 32312, (hereinafter "Conner") , and PROACTIVE TECHNOLOGIES, INC., a Delaware corporation, whose post office address is 7118 Beech Ridge Trail, Tallahassee, FL 32312. (Hereinafter "PTE" or the "Company") W I T N E S S E T H WHEREAS, on or about January ____, 1999, the parties hereto have executed or will execute a Stock Exchange Agreement whereby Conner will exchange 5,000,00 shares of restricted voting common stock of Proactive Technologies, Inc. (AMEX:PTE) in exchange for 100% of the issued and outstanding shares of Henry Holdings, Inc., a wholly owned subsidiary of PTE. WHEREAS, the Company, through its subsidiaries, Proactive First Holdings, Inc., a Florida corporation, successor by Articles of Merger to Jamesmark, Inc., a Florida corporation, Marketprice Properties, Inc., a Florida corporation, North Beach Holdings, Inc., a Florida corporation and Proactive First, Inc., a Florida corporation; Proactive First Holdings, Inc. of Georgia, a Georgia corporation, Proactive First Holdings of Albany, Inc., a Georgia corporation, Barrier Dunes Development Corporation, a Florida corporation, has executed various obligations with various lenders on various property owned by the Company through its subsidiaries, which obligations are in the form of promissory notes secured by underlying mortgages on the various properties; and WHEREAS, as part and parcel of the above mentioned obligations secured by property of the Company through its subsidiaries, Conner, and in some cases, Conner's spouse, LISA CONNER, was required on many of the obligations to sign as personal unconditional or conditional guarantor of said obligations. WHEREAS, the parties have discussed this agreement and wish to memorialize their agreement in writing. NOW, THEREFORE, in consideration of Ten Dollars ($10.00) and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, it is agreed as follows: 1.The Company, as part and parcel of the consideration set forth above as well as the consideration of the sale of his 5,000,000 shares of restricted voting common stock, agrees to forever indemnify and hold harmless Mark and/or Lisa Conner from and against any and all claims suits damage or damages and or loss or losses and or action or actions of any kind as a result of and arising out of any liability associated with any debt of the Company on which Mark and/or Lisa Conner remains as a guarantor. 2.The Company agrees to use all reasonable effort to obtain a legal and binding release, to the satisfaction of Mark and/or Lisa Conner, or their counsel, which removes Mark and/or Lisa Conner as a guarantor from any loan on which they remain, but in the event that said release is not obtained, then the Company agrees as follows: A.If the Company fails to pay any monthly interest payment or monthly or quarterly principal and interest payment as obligated under any of the aforementioned Notes and Mortgages on any obligation to any lender for a delinquency period of fifteen (15) days, then the Company shall be deemed to be in Default , and the Company agrees to deed any property underlying any unpaid obligation to Conner immediately. In the event Company fails to so deliver a deed for the aforementioned property in recordable form within three (3) days after the fifteenth day, then Company shall be deemed to be in breach and Conner may be allowed any and all available remedies provided under law, including specific performance. 3.Representations and Warranties to Survive. Unless otherwise provided, all of the representations and warranties contained in this Agreement and in any certificate, exhibit or other document delivered pursuant to this Agreement shall survive the Closing for a period of two (2) years, with the exception of the indemnification, which shall survive until the notes underlying the personal guaranty of Conner is paid in full. No investigation or lack of investigation made by any party hereto or their representatives shall constitute a waiver of any representations or warranty, and no such representation or warranty shall be merged into Closing. 4. Modification. The Company or Conner may amend, modify, or supplement this Agreement in any manner as they mutually agree only in writing. 5. Assignability. PTE or Conner may not assign this Agreement without the express prior written consent of each other. 6. Binding Effect. This Agreement, together with all other documentation delivered as exhibits or part of this transaction constitute the entire agreement between the parties. The terms and conditions of this Agreement shall inure to the benefit of and be binding upon the respective heirs, legal representatives, assigns of the parties hereto. 7. Governing Law. This Agreement and Transaction is are made pursuant to and will be construed under, the laws of Florida. 8. Severability. If any one or more of the provisions of this Agreement shall, for any reason, be construed to be invalid, illegal or unenforceable under applicable law, this Agreement shall be construed as if the invalid, illegal or unenforceable provision had never been contained therein. The remaining provisions of this Agreement shall be given effect to the maximum extent then permitted by law. IN WITNESS WHEREOF, the undersigned parties have duly executed this Agreement on the date first written above. "PTE" or "COMPANY" "CONNER" PROACTIVE TECHNOLOGIES, INC. _________________________________ ___________________________________ By: Arthur G. Weiss, Vice President By:Mark A. Conner Signed, sealed and delivered Signed, sealed and delivered in the presence of in the presence of ____________________________ _____________________________ Unofficial Witness Unofficial Witness ____________________________ (SEAL) _____________________________ (SEAL) Notary Public Notary Public My commission expires: My commission expires: ______________________________ ___________________________ EX-10.3 5 PROFIT SHARING AGREEMENT PROFIT SHARING AGREEMENT THIS PROFIT SHARING AGREEMENT, is made this _____ day of January, 1999, by and between MARK A. CONNER, of 2500 Deer Lake Road, Tallahassee, FL 32312, (hereinafter "Conner") and HENRY HOLDINGS, INC., 2500 Deer Lake Road, Tallahassee, FL 32312, (hereinafter "HENRY HOLDINGS") and Proactive TECHNOLOGIES, INC., a Delaware corporation, whose post office address is 7118 Beech Ridge Trail, Tallahassee, FL 32312. (Hereinafter "PTE" or the "Company") W I T N E S S E T H WHEREAS, on or about January ____, 1999, the parties hereto have executed or will execute a Stock Exchange Agreement whereby Conner will exchange 5,000,00 shares of restricted voting common stock of Proactive Technologies, Inc. (AMEX:PTE) in exchange for 100% of the issued and outstanding shares of Henry Holdings, Inc., a wholly owned subsidiary of PTE. WHEREAS, the Company, through its subsidiaries, Proactive First Holdings, Inc., a Florida corporation, successor by Articles of Merger to Jamesmark, Inc., a Florida corporation, Marketprice Properties, Inc., a Florida corporation, North Beach Holdings, Inc., a Florida corporation and Proactive First, Inc., a Florida corporation; Proactive First Holdings, Inc. of Georgia, a Georgia corporation, Proactive First Holdings of Albany, Inc., a Georgia corporation, Barrier Dunes Development Corporation, a Florida corporation, has executed various obligations with various lenders on various property owned by the Company through its subsidiaries, which obligations are in the form of promissory notes secured by underlying mortgages on the various properties; and WHEREAS, as part and parcel of the above mentioned obligations secured by property of the Company through its subsidiaries, Conner, and in some cases, Conner's spouse, LISA CONNER, was required on many of the obligations to sign as personal unconditional or conditional guarantor of said obligations. WHEREAS, the parties have discussed this agreement and wish to memorialize their agreement in writing. NOW, THEREFORE, in consideration of Ten Dollars ($10.00) and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, it is agreed as follows: 1.PTE, Conner and Henry Holdings agree that the fair market value of the real estate owned by Henry Holdings ("Real Estate") is equal to One Million Three Hundred Thousand Dollars and No Cents ($1,300,000.00) after reduction for the Company's secured indebtedness on the Real Estate. 2.In the event Henry Holdings sells the Real Estate in bulk prior to April 1, 1999 for net profits in excess of One Million Three Hundred Thousand Dollars ($1,300,000.00), Conner and Henry Holdings agree to pay PTE all profits in excess of One Million Three Hundred Thousand Dollars ($1,300,000.00). Net profits shall be equal to the total purchase price less the following: assumption of debt, commissions and reasonable closing costs. . 3.The parties agree that this profit sharing agreement and disgorging to the company shall terminate and be null and void at 12:01 A.M. on Friday April 2, 1999. 4. Modification. The Company or Conner may amend, modify, or supplement this Agreement in any manner as they mutually agree only in writing. 5. Assignability. PTE or Conner may not assign this Agreement without the express prior written consent of each other. 6. Binding Effect. This Agreement, together with all other documentation delivered as exhibits or part of this transaction constitute the entire agreement between the parties. The terms and conditions of this Agreement shall inure to the benefit of and be binding upon the respective heirs, legal representatives, assigns of the parties hereto. 7. Governing Law. This Agreement and Transaction is are made pursuant to and will be construed under, the laws of Florida. 8. Severability. If any one or more of the provisions of this Agreement shall, for any reason, be construed to be invalid, illegal or unenforceable under applicable law, this Agreement shall be construed as if the invalid, illegal or unenforceable provision had never been contained therein. The remaining provisions of this Agreement shall be given effect to the maximum extent then permitted by law. IN WITNESS WHEREOF, the undersigned parties have duly executed this Agreement on the date first written above. "PTE" or "COMPANY""CONNER" Proactive TECHNOLOGIES, INC. _______________________________________ _____________________________ By: Arthur G. Weiss, Vice President By:Mark A. Conner Signed, sealed and delivered Signed, sealed and delivered in the presence of in the presence of ___________________________ ______________________________ Unofficial Witness Unofficial Witness ____________________________ (SEAL) _____________________________ (SEAL) Notary Public Notary Public My commission expires: My commission expires: ___________________________ ______________________________ EX-99.1 6 PRESS RELEASE NEWS RELEASE FOR IMMEDIATE RELEASE CONTACT: Proactive Technologies, Inc. Millennium Holdings Group, Inc. 7118 Beech Ridge Trail (561) 988-2334 Tallahassee, FL 32312 (850) 668-8500 PROACTIVE TECHNOLOGIES, INC. REPURCHASES 5,000,000 SHARES OF ITS STOCK Tallahassee, Florida, January 21, 1999. Proactive Technologies, Inc. (American Stock Exchange: PTE) announced today that it has repurchased 5 million shares of Proactive Technologies' stock that had been held by Mark A. Conner. The stock repurchase, which was approved by the Company's Board of Directors, was a negotiated transaction. The Company exchanged Mr. Conner property and cash, through a share exchange, equivalent to $0.40 per share, a price below the stock's closing price. Mr. Conner has resigned as a Director, President & CEO of the Company, and as an officer and director of all of the Company's subsidiaries, in order to pursue other interests. Upon acceptance of Mr. Conner's resignation, the Proactive Technologies' Board elected Arthur G. Weiss as Chairman, President and CEO of the Company. Mr. Weiss was recently added to the Company's Board after the Company's acquisition of West Side Investors, Inc. from Mr. Weiss and his family. In making these announcements, Mr. Weiss stated: "These transactions mark a turning point for Proactive Technologies. The Company is diversifying from subdivision development to other activities. We are very enthusiastic about the Company's recent acquisitions and the opportunities to focus on building shareholder value." Proactive Technologies, Inc. is a real estate developer of single-family subdivisions in Florida and Georgia. Proactive is presently involved in developing 14 separate communities. Proactive Technologies, Inc. core business, Capital First Holdings, Inc. is the largest developer in Tallahassee / Leon County (the Florida state capital) in north Florida, where it holds a 31% market share. This release contains forward-looking statements with the meaning of section 21A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Although the Company believes the expectations reflected in the forward-looking statements and assumptions upon which forward-looking statements are based are reasonable it can give no assurance that such expectations and assumptions will prove to have been correct. See the Company's Annual Report on Form 10-KSB for additional statements concerning important factors, such as demand for products, manufacturing costs and competition, that could cause actual results to differ materially from the Company's expectations. # # # -----END PRIVACY-ENHANCED MESSAGE-----