SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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Form 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report: August 31, 1998
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(Date of earliest reported event)
READY CAPITAL CORP. (formerly COLORSTONE INTERNATIONAL, INC.)
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(Exact name of registrant as specified in its charter)
New York 33-24329-NY 13-3475609
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(State of other (Commission (IRS Employer
jurisdiction of File No.) Identification No.)
incorporation)
630 Third Avenue
New York, New York 10017
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(Address of Principal Executive Office) (Zip Code)
Registrant's telephone number including area code (212) 661-2727
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519 Capobianco Plaza, Rahway, New Jersey 07065
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(Former address changed from last report)
Item 5. Other Events
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(a) On August 17, 1998, the Registrant and Colorstone International,
Inc. ("Colorstone") rescinded a prior Plan of Merger consummated in March 1997
pursuant to which Registrant had acquired all of the common shares issued and
outstanding in Colorstone.
(b) On August 17, 1998, the following persons, all of whom were
affiliated with the previously acquired company, Colorstone, resigned as
directors of the Registrant:
(1) Joseph A. Rusk, Jr.
(2) Frederick P. Scheck
(3) Michael D. Fazio
(4) Mitchell Reisman
(5) Henry Kaufman
(6) Gerard Souham
Item 7. Financial Statements and Exhibits
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EXHIBITS
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(1) Rescission Agreement
SIGNATURE
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Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned thereto duly authorized.
READY CAPITAL CORP.
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Registrant
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Frank Grillo, Director
Dated: August 31, 1998
RESCISSION AGREEMENT
AGREEMENT made this day of August, 1998 by and between Ready Capital
Corporation ("Ready"), a New York Corporation and Colorstone International,
Inc. ("Colorstone"), a Delaware Corporation.
WHEREAS, on January 14, 1997 the parties entered into a Plan and
Agreement of Merger pursuant to which the parties agreed to merge with Ready
being the surviving corporation and Colorstone being the constituent
corporation; and
WHEREAS, on February 25, 1997 a meeting of the shareholders of Ready
was held pursuant to notice and proxy at which the transaction was approved,
the resignations of Ready's directors were accepted and new directors were
appointed; and
WHEREAS, on March 3, 1997, a closing of the transaction occurred
which was reported on Form 8-K on March 14, 1997; and
WHEREAS, Colorstone agreed to provide the requisite financial
statements in accordance with Regulation S-X, Rule 305(b) in a timely manner,
but has failed to do so from that time to the present; and
WHEREAS, there has been no trading activity, legal compliance
undertaken or other conduct as a combined entity by Ready since the closing;
and
WHEREAS, the parties are agreed to rescind the transaction and
restore the status quo ante prior to closing;
NOW, THEREFORE, in consideration of the mutual covenants and
agreements contained herein and for other good and valuable consideration, the
receipt and sufficiency of which is acknowledged, the parties agree as
follows:
1. Transfer of Securities
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1.1 Ready hereby transfers back to Colorstone's stockholders all
shares of its common stock issued and outstanding as of the date of closing,
represented by Colorstone to be 6,674,400 shares and relinquishes any claim to
said shares.
1.2 Colorstone's stockholders hereby relinquish any claims to any
Ready shares.
1.3 Within ten (10) days of the date of this agreement, Colorstone
agrees to deliver to Frank Grillo or his designees One Hundred Thousand
(100,000) shares of its common stock in consideration for his services as a
finder in the transaction as envisioned in Article XII, paragraph 7 of the
merger agreement.
2. Resignation of Directors
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As of the date of this Agreement, the Directors of the surviving
corporation, namely Joseph A. Rusk, Jr., Frederick Scheck, Michael Fazio,
Mitchell Reisman, Henry Kaufman and Gerard Souham, are deemed to have either
resigned their positions as the directors elected by the stockholders at the
meeting held on February 25, 1997, or in the alternative, agree that they did
not accept their election as directors. Colorstone agrees to obtain written
confirmation of the foregoing from each of the above named directors and
provide same to Ready within ten (10) days of the date of this Agreement.
3. Mutual Releases
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3.1 In consideration of the performance of their respective
obligations and covenants under this Agreement and their representations and
warranties under this Agreement, the adequacy and sufficiency of which
consideration are hereby acknowledged, each of the parties hereby releases and
discharges each other and their respective shareholders, officers, directors,
partners (general and limited), principals, employees, agents, parents,
subsidiaries, affiliates (including, without limitation, any entity owned,
controlled by or under common control with such persons and entities) and
their respective heirs, executors, administrators, personal representatives,
successors and assigns from any and all actions, causes of action, suits,
debts, contracts, controversies, agreements, promises, damages, liabilities,
judgments, executions, claims and demands whatsoever, in law equity.
3.2 Notwithstanding any provision of this Agreement to the contrary,
the releases provided herein and the indemnity provided hereafter will be void
ab initio and of no further force or effect (i) as to any party to this
Agreement who or which fails to perform any of his or its obligations or
covenants under this Agreement, or (ii) in the event that this Agreement, or
any provision hereof, is ever adjudicated unenforceable, or (iii) in the event
that this Agreement or any part thereof is rescinded or modified by operation
of law or by order of any court of competent jurisdiction, including, without
limitation, any order of any such court pursuant to or in connection with a
bankruptcy, insolvency or similar proceeding.
4. Indemnification
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Colorstone and its officers, directors stockholders and affiliates
hereby agree to indemnify Ready and its officers, directors, affiliates and
agents from any losses, claims, damages liabilities, costs and expenses
(including legal fees) which are or may be sustained by them arising out of
any claim, action or proceeding asserted or commenced against them by any
creditor or stockholder of Colorstone, or any purchaser of Colorstone
securities form this date of closing to the date of this Agreement, including
without limitation The Absolute Connection.
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5. Miscellaneous
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5.1 Notices. Any notice or other communication required or permitted
to be given under this Agreement must be in writing and delivered in person or
by registered or certified mail, return receipt requested, or by a nationally
recognized overnight express courier service, receipt acknowledged, to the
proper address of the party to whom such notice is being given as specified
herein (or to any such party at any different address provided by notice given
in compliance with this provision). All notices or other communications to
Ready shall be addressed to Ready, c/o Berger & Paul, LLP at 630Third Avenue,
New York, New York 10017. All notices or other communications to Colorstone
shall be addressed to Colorstone International, Inc., 519 Capobianco Plaza,
Rahway, New Jersey 07065, Attn: Mitchell Reisman. All such notices or other
communications shall be deemed given upon receipt, in the case of hand or
courier delivered notices or other communications, or within three (3) days of
mailing, as aforesaid (except for a notice of a change of address which shall
be deemed given only upon receipt).
5.2 Non-Assignability, Benefit of Agreement. This Agreement is
non-assignable and shall inure to the benefit of, and shall be binding upon,
the parties hereto and their respective heirs, executors, administrators,
successors, and legal representatives.
5.3 Headings. The paragraph headings contained in this Agreement are
for convenience of reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement.
5.4 Applicable Law, Jurisdiction and Venue. This Agreement shall be
governed by and construed in accordance with the laws of the State of New
York, with respect to contracts made and to be fully performed therein,
without regard to the conflicts of laws provisions there of. The parties
hereto hereby agree that any suit or proceeding arising under this Agreement
or the consummation of the transaction contemplated hereby, shall be brought
solely in a federal or state court located in the City, County, and State of
New York. By their execution hereof, the parties hereto hereby consent and
irrevocably submit to the in personam jurisdiction of the federal and state
courts located in the City, County and State of New York, and agree that any
process in any suit or proceeding commenced in such courts under this
Agreement may be served upon them personally, by certified or registered mail,
return receipt requested or by Federal Express or other nationally recognized
overnight express courier service, with the same force and effect as if
personally served upon them in New York. The parties hereto each waive any
claim that any such jurisdiction is not a convenient forum for any such suit
or proceeding and any defense of lack of in personam jurisdiction with respect
thereto. In the event of any such action or proceeding, the party prevailing
therein shall be entitled to payment from the other parties hereto, on a joint
and several basis, of his or its reasonable counsel fees and disbursements in
an amount judicially determined.
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5.5 Partial Waiver. The failure of any party hereto in any one or
more instances to insist upon the performance of any of the terms or
conditions of this Agreement, or to exercise any right or privilege conferred
in this Agreement, or the waiver of any breach of any of the terms, covenants
or conditions of this Agreement, shall not be construed as thereafter waiving
any such terms, covenants, conditions, rights or privileges, and the same
shall continue and remain in full force and effect as if no such forbearance
or waiver had occurred. No change, termination or attempted waiver of any of
the provisions hereof shall be binding unless in writing and signed by the
party against whom the same is sought to be enforced.
5.6 Representations and Warranties. Each of the parties hereto hereby
represents and warrants to the other that(i) he or it has the full power and
authority to enter into this Agreement, (ii) this Agreement has been duly
authorized by all necessary corporate or other action required therefor, and
(iii) this Agreement is a binding obligation of each of the parties hereto.
5.7 Independent Legal Representation. Each of the parties represents
and warrants that such party has read and reviewed this Agreement in its
entirety and has sought and obtained, or has had the full opportunity to seek
and obtain, the benefit of full, complete and competent legal advice and
counsel in connection with this Agreement and that such party fully
understands the meaning and intent of every provision hereof. The parties
hereto agree that the fact that counsel for any one party may have drafted
this Agreement or any of the provisions contained in this Agreement shall not
be cause for the construction or interpretation of that provision against that
party.
5.8 Counterparts. This Agreement may be executed in separate but
identical counterparts, each of which shall be an original, but all of which
shall together constitute but one and the same instrument.
5.9 Further Assurances. The parties hereto hereby agree that, at any
time and from time to time after the date hereof, upon the reasonable request
of any party hereto, they shall do, execute, acknowledge and deliver, or cause
to be done, executed, acknowledged and delivered, such further acts, deeds,
assignments, transfers, conveyances, and assurances as may be reasonably
required to more effectively consummate this Agreement and the transactions
contemplated thereby or to confirm or otherwise effectuate the provisions of
this Agreement.
IN WITNESS WHEREOF, each of the parties hereto have duly executed or
caused this Agreement to be duly executed as of the day and year first above
written.
READY CAPITAL CORP. COLORSTONE INTERNATIONAL, INC.
By: By:
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Frank Grillo, Director Mitchell Reisman, Secretary - Treasurer
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