I thought many of you might like to see this play by PH. My loss is nothing compared to this gentleman's losses.
ESVS Shareholders Rights Group
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Re: For who? For what?
From: Ralph LaBarge
Date: 4/29/99
Time: 10:00:46 PM
Remote Name: 209.116.248.38
Comments
An explanation from me is a reasonable request. Lets start at the beginning. I started an engineering
company by the name of NB Engineering more than 12 years ago. The company grew over time to
have more than 30 full time employees and was purchased by Enhanced Services Company about
four years ago. As a result of the purchase of NB Engineering by Enhanced Services I became the
one of the largest individual owners of ESVS common shares. I also was elected to serve on the
ESVS Board of Directors.
About 18 months ago the ESVS Board of Directors was faced with a difficult decision. Due to rule
changes by the SEC and NASDAQ we either had to merge with another company (to create more
net tangible assets) or get delisted from NASDAQ. After many meetings with possible merger
candidates we decided to merge with Zulu-Tek. A very complicated and lengthy merger document
was prepared, and in March of 1998 it was approved by the ESVS Board of Directors and the
Zulu-Tek Board of Directors.
The agreement required that I "loan" almost 90,000 shares of ESVS common stock to NetVest,
Inc. a company controlled by Pat Hayton. It also required that I resign from the ESVS Board of
Directors. Similar stipulations as far as stock "loans" and resignation from the ESVS Board applied
to Mr. Ken Duckman the CEO of ESVS, and the single largest ESVS Shareholder (he owned more
than 50% of the outstanding shares at the time).
Zulu-Tek replaced the old five member ESVS Board of Directors with a new 3 member Board
comprised of people who reported directly to Pat Hayton. Within just a few months of approval of
the merger agreement the two major operating companies of ESVS, Laptop Solutions - Texas, and
NB Engineering were closed on the orders of the new ESVS Board of Directors.
Since there was a reasonable arguement that the Laptop Solutions and NB Engineering operations
did not really fit in with ESVS's intention of becoming an Internet Services company, combined with
the fact that most of my ESVS shares were tied up in a stock loan agreement with NetVest, there
was not much I could do at this point except look for a way to generate enough income to pay my
bills. I should note that I have a binding two year employment agreement with ESVS, but they are
more than 10 months in arrears in payments and I dont expect to ever see any money from them.
To make a long story short, when the time came for NetVest to return my "loaned" ESVS common
shares they failed to live up to the terms of our agreements. As far as I am concerned NetVest,
ESVS, Pat Hayton and Richard Fisher (the "Trustee of the Stock Loan Agreement) have essentially
stolen almost 90,000 shares of ESVS common shares from me. At the time they "borrowed" these
shares they were worth about $400,000. Even if they did return my shares today they would be
worth only about $27,000.
Since NB Engineering was closed on May 31, 1998 I have had little or no contact with anyone at
ESVS or Zulu-Tek with the exception of Robert Smith, the ESVS CFO (Bob recently resigned his
position, so now I have no contacts with the company). I have given up all hope of getting my ESVS
shares back, or getting my employment agreement paid off.
While I suspect this effort is too little and too late, I am sincere in my attempts to replace the current
ESVS Board of Directors and Management Team with people who will put the interests of the
ESVS Shareholders first.
I hope that this answers your questions of Why Here and Why Now. I can assure you that ESVS
and Zulu-Tek have absolutely nothing to do with this ESVS Shareholders Rights Group WebSite. I
fully expect that they will try to shut it down in the near future since it will interfere with their attempts
to raise money by selling even more ESVS and Zulu shares to the unsuspecting public.
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