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Bench Group, Inc. Consummates Share Exchange with Qualmax, Inc.PORT CHESTER, N.Y. --(Business Wire)-- Dec. 2, 2005 -- Bench Group, Inc. (Pink Sheets: BNGP), today announced that it acquired all of the outstanding common stock of Qualmax, Inc. ("Qualmax"), in exchange for 14,500,000 newly issued shares of Bench Group's Common Stock, on November 30, 2005, pursuant to an agreement and plan of share exchange dated as of June 24, 2005, as amended. Furthermore, Bench Group may be required, under certain circumstances, to issue up to 500,000 additional shares of its Common Stock to Qualmax's former shareholders. Prior to the closing of the transaction, Bench Group had 1,200,000 shares of outstanding common stock. In connection with this transaction, Bench Group plans to change its name to "Qualmax, Inc." This business combination constitutes a change in control of Bench Group. As a result of the transaction, the former shareholders of Qualmax now own over 90% of the outstanding common stock of Bench Group. Additionally, the officers and directors of Bench Group immediately prior to the transaction resigned and have been replaced with Qualmax's officers and directors. Biographical information for Qualmax's team of executive officers and directors are annexed hereto as Annex A. Immediately prior to its acquisition of Qualmax, Bench Group had no business operations, and Qualmax was a privately owned Oregon corporation. Qualmax, through its three operating divisions, develops and markets VOIP (Voice Over IP) technology products and services. Qualmax's division structure supports a market strategy that has been formed with the singular mission of addressing the disparate needs of global enterprise and service provider customers. -- The IP Gear division integrates best-of-breed VOIP and Cellular Gateways for retail and service provider markets, coupled with a full suite of proprietary software designed to ease the deployment, migration and use of VOIP systems. -- The iNode division provides international, including domestic US, voice and internet services over its state of the art IP network to retail customers, enterprise customers and service providers in the US, Europe, Latin America, and Asia. -- The Qualmax Professional Services division ("QPS") provides best-of-breed third party hardware, software and engineering services as a 'vendor neutral' value-added reseller to support Qualmax customers in all divisions. In this sense QPS's services compliment Qualmax's core IP Gear and iNode product and service offerings. Together, Qualmax's three 'divisions' offer customers solutions to support the end-to-end migration of traditional legacy networks to next generation IP networks. Qualmax believes that, by touching the customer at the maximum possible interfaces for VOIP systems, Qualmax is able to gain real-time information on emerging customer requirements and demands, which in turn allows Qualmax to respond quickly to address the corresponding market opportunities. Selected historical financial data for Qualmax is annexed hereto as Annex B. Commenting on the transaction, M. David Kamrat, the new Chief Executive Officer of Bench Group, said, "Qualmax's mission to become a global player in voice and data solutions has achieved another milestone. We believe that this business combination will result in an immediate increase in Bench's earnings per share, and will enable us to accelerate the execution of Qualmax's business strategy of internal growth and acquisitions through an entity whose shares are quoted in the Pink Sheets." Under the terms of the transaction, the holders of outstanding options to purchase Qualmax common stock will exchange such options for options to purchase up to an aggregate of 8,462,635 newly issued shares of Bench Group Common Stock. Of these options, 8,089,609 have exercise prices ranging from $0.1349 to $0.2282 per share and the remaining 373,026 have an exercise price of $0.7037 per share. Such options vest at various times and/or upon the occurrence of certain milestones. Options with respect to 263,622 shares had already vested as of November 30, 2005, and options with respect to another 1,163,585 shares will vest by their terms by December 31, 2006 (assuming continued employment of the relevant optionees). Qualmax has obtained the agreement of the holders of 5,000,000 of these options not to exercise any of their options until May 30, 2007. Furthermore, the consummation of this transaction satisfies one of the conditions to closing of Qualmax's previously announced agreement to acquire the communications division of B.O.S. Better On Line Solutions Ltd., which remains subject to certain additional closing conditions. The B.O.S. communications division manufactures and sells, primarily into the European market, multi-path, intelligent routing VoIP gateways, GSM gateways and other cellular gateways. Designed for the corporate market, these devices enable major reduction of inter-office, long-distance and cellular-to-line communication costs using VPN, cellular-to-cellular networks or the public Internet to carry telephone calls. The consideration payable to B.O.S. in the transaction is up to 4,263,158 shares of Bench Group Common Stock and 4% royalties from future revenues generated from the purchased business up to $800,000. One quarter of the Bench Group shares to be received by B.O.S. in the transactions shall be deposited in escrow and shall be released to B.O.S. at the end of four consecutive fiscal quarters following the closing of the transaction, contingent upon Qualmax generating by then certain revenues from the purchased business. Mr. David Kamrat, CEO of Qualmax said, "The VoIP and GSM space requires the ability to adapt rapidly to dynamic market conditions. With the acquisition of B.O.S. communications division, Qualmax gains a world-class R&D and product development team. We see this acquisition as a critical component in our mission to offer our customers the most advanced and feature-rich applications in the industry. We also believe this acquisition demonstrates our commitment to seek out synergistic businesses and to build long term value for our investors." Forward Looking Statements This news release contains certain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, as amended. Such statements may include statements regarding the prospective acquisition, expected financial results and other statements that are not historical facts, including statements which may be preceded by the words "intends," "may," "will," "plans," "expects," "anticipates," "projects," "predicts," "estimates," "aims," "believes," "hopes," "potential" or similar words. For such statements, Bench Group claims the protection of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are not guarantees of future performance, are based on certain assumptions and are subject to various known and unknown risks and uncertainties, many of which are beyond the control of Bench Group. Actual results may differ materially from the expectations contained in the forward-looking statements. Factors that may cause such differences include the risks that: (i) the conditions to closing under the Asset Purchase Agreement between Qualmax and B.O.S. will not be satisfied; (ii) Qualmax's existing customers will reduce their consumption of Qualmax's products and services; (iii) Qualmax's efforts to reach new customers and to develop and market new products will be unsuccessful; and (iv) Bench Group's business will be otherwise materially adversely affected. Bench Group does not undertake to publicly update or revise its forward-looking statements as a result of new information, future events or otherwise. Annex A: Biographical Information for Officers and Directors M. David Kamrat. David Kamrat has been Qualmax's chief executive officer and chairman of its board of directors since he founded Qualmax in 2002. Mr. Kamrat has operated a telecom consulting business, Mind Opening Corporation, since leaving MCI, Inc., where he worked as a sales executive throughout the 1990's. Prior to working with MCI, Mr. Kamrat had a successful career in construction and land development. David and Noah Kamrat are father and son. Noah Kamrat. Noah Kamrat has been Qualmax's president and chief operating officer and one of its directors since its inception in 2002. Prior to Qualmax, Noah was the President of Synergyx Communications Group, an IP consulting and technology reseller from 1998 to 2002. Mr. Kamrat filed for bankruptcy protection in March 2003 and the case was discharged in May 2003. Before his tenure at Synergyx, Mr. Kamrat was Director of National Accounts for Frontier Communications (Global) from 1996 to 1998. Prior to his tenure with Frontier, Mr. Kamrat was a sales consultant specializing in long distance and Internet services for MCI. While at MCI, Mr. Kamrat was the recipient of the following prestigious sales awards: the Chairman's Top Sales Award 1996 and 1997; and the Masters Sales Award 1995 and 1996. Edward (Ted) Moffly. Mr. Moffly joined Qualmax as its Chief Financial Officer in October 2005, and was elected to the board of directors in November 2005. Ted has worked as an entrepreneur and executive in various industries, from construction and energy to finance and telecom. Mr. Moffly has been the CEO of Spin Networks, a Florida Corporation since founding it in 2001. From 1994 to 2000, Mr. Moffly was the CFO of Tiltwall, Inc., a facilities-based contractor whose customers included MCI, Kodak and Detroit Diesel for technology build-outs. Ted was also CEO of Synergyx, an IP integration company that designed, built and managed IP networks in over 50 countries, from 2000 to 2001. Ted attended Columbia University and received an MBA from the University of Chicago in 1997. Duy Tran. Duy Tran is iNode's chief operating officer. Mr. Tran joined iNode in February of 2005, in connection with iNode's acquisition of assets of Microstar Telecommunications Corp. Prior to joining iNode, Mr. Tran founded Ypsilon Computer Handels GmbH & Co. in 1994 as a dedicated reseller of high-powered personal computers in the German market. In 2000, he moved his base of operations to Oregon and since then has successfully built Microstar Telecommunications Corp., the successor to Ypsilon, into a U.S.-based computing and telecommunications hardware resales operation. Mr. Tran has over ten years' experience in selling, purchasing and managing financial and operational activities in the technology and telecommunications sectors. Mr. Tran speaks fluent German, French and Vietnamese and has business contacts in Europe and Southeast Asia that Qualmax considers important. Brad Guillory. Mr. Guillory joined Qualmax as its Chief Technical Officer in October 2005. During the past 10 years, Mr. Guillory has held high level IT engineering positions as a security specialist at Reuters, SEA-IS and Bailey Link. Brad has experience in a range of disciplines, including VoIP, network design, open source systems, and network security. Mr. Guillory has done extensive work on security environments for policy development review and compliance across a number of enterprise industries. Brad received his BS in Physics from the University of New Orleans. -0- *T Annex B: Selected Historical Qualmax Financial Data Six Months Year ended Year ended ended June December December 30, 2005 31, 2004 31, 2003 ---------- ----------- ----------- (unaudited) Revenue $7,935,000 $12,750,000 $7,818,000 Costs of goods sold 6,762,000 10,220,000 6,452,000 Selling, general & administrative expense 974,000 1,457,000 1,024,000 ---------- ----------- ---------- Net income before taxes 205,000 701,000 339,000 ========== =========== ========== Total assets 4,211,000 2,632,000 1,406,000 Total liabilities 2,912,000 1,662,000 1,174,000 ---------- ----------- ---------- Stockholders equity 1,299,000 970,000 232,000 ========== =========== ========== *T |
