SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A--INFORMATION REQUIRED
IN A PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a)
of the Securities Exchange Act of 1934
Filed by the Registrant [ X ]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ X ] Preliminary Proxy Statement
[ ] Confidential, for use of the Commission Only (as permitted by Rule
14a-6(e)(2))
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Materials Pursuant to ss. 240.14a-11(c) or ss. 240.14a-12
NUWAVE Technologies, Inc.
---------------------------------------------
(Name of Registrant as Specified in its Charter)
---------------------------------------------
(Name of Person(s) Filing Proxy Statement if other than Registrant)
Payment of Filing Fee (Check the appropriate box):
[ X ] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
--------------------------------
2) Aggregate number of securities to which transaction applies:
--------------------------------
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth amount on which the
filing fee is calculated and state how it was determined):
--------------------------------
4) Proposed maximum aggregate value of transaction:
--------------------------------
5) Total fee paid:
--------------------------------
[ ] Fee paid previously with preliminary materials.
<PAGE>
[ ] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting
fee was paid previously. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its filing.
1) Amount Previously Paid: _______________________________________
2) Form, Schedule or Registration Statement No: __________________
3) Filing Party: _________________________________________________
4) Date Filed: ___________________________________________________
<PAGE>
PRELIMINARY COPIES
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NUWAVE TECHNOLOGIES, INC.
ONE PASSAIC AVE.
FAIRFIELD, NEW JERSEY 07004
---------------------------
NOTICE OF SPECIAL MEETING OF STOCKHOLDERS
TO BE HELD ON JANUARY __, 2000.
To the Stockholders of NUWAVE Technologies, Inc.:
NOTICE IS HEREBY GIVEN THAT a Special Meeting of Stockholders (the "Special
Meeting") of NUWAVE Technologies, Inc., a Delaware corporation (the "Company"),
will be held at ___________________, at ________local time, to consider and act
upon the following matters:
1. To approve the issuance of shares of the Company's common stock and
related warrants aggregating a minimum of $3,000,000 and a maximum of
$6,000,000 in a private offering, to fulfill Nasdaq Stock Market Rule
4410(c)(25)(H);
2. To approve a proposed amendment to the Company's Certificate of
Incorporation to increase the authorized shares of common stock by
20,000,000 shares to 40,000,000 shares; and
3. To consider and act upon any other matters that properly may come
before the Special Meeting or any adjournment or postponement thereof.
The Company's Board of Directors has fixed the close of business on
____________, 1999 as the record date (the "Record Date") for the determination
of stockholders having the right to notice of, and to vote at, the Special
Meeting and any adjournment thereof. Only holders of record of common stock of
the Company at the close of business on the Record Date shall be entitled to
receive notice of and to vote at the Special Meeting and any adjournments or
postponements thereof. A list of such stockholders will be available for
examination by a stockholder as of the Record Date for any purpose germane to
the Special Meeting during ordinary business hours at the offices of the Company
at One Passaic Avenue, Fairfield, New Jersey 07004, during the ten business days
prior to the Special Meeting.
Information concerning the matters to be acted upon at the Special Meeting
is set forth in the accompanying Proxy Statement.
<PAGE>
All stockholders are cordially invited to attend the Special Meeting.
By Order of the Board of Directors,
Jeremiah F. O'Brien
Secretary
Fairfield, New Jersey
December ___, 1999
WHETHER OR NOT YOU EXPECT TO ATTEND THE SPECIAL MEETING, PLEASE COMPLETE,
DATE AND SIGN THE ENCLOSED PROXY AND MAIL IT PROMPTLY IN THE ENCLOSED ENVELOPE
IN ORDER TO ENSURE REPRESENTATION OF YOUR SHARES. NO POSTAGE NEED BE AFFIXED IF
THE PROXY IS MAILED IN THE UNITED STATES. THE GIVING OF YOUR PROXY AS REQUESTED
HEREBY WILL NOT AFFECT YOUR RIGHT TO VOTE IN PERSON SHOULD YOU DECIDE TO ATTEND
THE SPECIAL MEETING.
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<PAGE>
PRELIMINARY COPIES
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NUWAVE TECHNOLOGIES, INC.
ONE PASSAIC AVE.
FAIRFIELD, NEW JERSEY 07004
(973) 882-8810
PROXY STATEMENT
SPECIAL MEETING OF STOCKHOLDERS
TO BE HELD ON [__________], 2000.
December _______, 1999
TO THE STOCKHOLDERS:
GENERAL INFORMATION
-------------------
This Proxy Statement has been prepared and is being furnished by the Board
of Directors of NUWAVE Technologies, Inc., a Delaware corporation (the
"Company"), in connection with the solicitation of proxies at the special
meeting of stockholders (the "Special Meeting") to be held at _______________,
on _______________, 2000, at _______ local time, and at any adjournment or
postponement thereof, for the purposes set forth in the attached Notice. When
proxies are properly dated, executed, and returned, the shares they represent
will be voted at the Special Meeting in accordance with the instructions of the
stockholder completing the proxy.
It is anticipated that this Proxy Statement and the accompanying form of
proxy will be mailed to the stockholders on or about December __, 1999.
VOTING SECURITIES AND VOTE REQUIRED
-----------------------------------
Only holders of record (the "Stockholders") of the Company's common stock,
$.01 par value (the "Common Stock"), on the books of the Company at close of
business on _____________, 1999 (the "Record Date") are entitled to vote at the
Special Meeting and any adjournments or postponements thereof. On that date,
there were ____________ issued and outstanding shares of Common Stock entitled
to vote at the Special Meeting. Each Stockholder is entitled to one vote for
each share of Common Stock registered in that person's name on the books of the
Company on the Record Date on all business to come before the Special Meeting.
The presence at the Special Meeting, in person or by proxy, of the holders
of a majority of the Company's Common Stock issued and outstanding and entitled
to vote at the Special Meeting as of the Record Date is necessary to constitute
a quorum to transact business.
At the Special Meeting, Stockholders will be asked to approve a proposed
placement of securities (Proposal No. 1) and an increase in the authorized
shares of Common Stock (Proposal No. 2).
Assuming a quorum is present, the affirmative vote of the holders of a
majority of the shares represented and entitled to vote at the Special Meeting
is required for approval of Proposal No. 1, and the affirmative vote of the
holders of a majority of outstanding shares of Common Stock is required for
approval of Proposal No. 2. Abstention votes will have the effect 9:35
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PMDecember 18, 1999 10 NY#115676 v6 9:35 PMDecember 18, 1999 2 NY#115676 v6 of a
vote against the Proposals. Broker no-votes will be counted for the purpose of
determining whether there is a quorum at the Special Meeting, but they will have
no effect on the outcome of the vote on Proposal No. 1 and will have the effect
of a negative vote on Proposal No. 2.
<PAGE>
Shares of Common Stock which are represented by properly executed proxies,
unless such proxies shall have previously been revoked, will be voted in
accordance with the instructions indicated in such proxies. If no contrary
instructions are indicated, such shares will be voted: (1) FOR Proposals Nos. 1
and 2 detailed below and (2) in the discretion of the persons named in the
proxies as proxy appointees as to any other matter that may properly come before
the Special Meeting.
If a Stockholder cannot be present in person at the Special Meeting, the
Board of Directors of the Company requests such Stockholder to execute and
return the enclosed proxy as soon as possible. The person who signs the proxy
must be either (i) the registered Stockholder of such shares of Common Stock, or
(ii) a trustee, executor, administrator, guardian, attorney-in-fact, officer of
a corporation, or any other person acting in a fiduciary or representative
capacity on behalf of such registered Stockholder.
A Stockholder who has given a proxy may revoke it at any time before it is
voted at the Special Meeting by giving written notice of revocation to the
Secretary of the Company, by submitting a proxy bearing a later date, or by
attending the Special Meeting and voting in person. Any such notice or
subsequent proxy should be sent to the attention of Jeremiah F. O'Brien,
Secretary, NUWAVE Technologies, Inc., One Passaic Avenue, Fairfield, New Jersey
07004.
The Company is paying all the expenses of the solicitation of proxies,
including the expenses of printing and mailing this Proxy Statement, the
accompanying Notice of Special Meeting of Stockholders, and the enclosed proxy.
The Company will also reimburse brokerage houses and other custodians, nominees
and fiduciaries for their expenses, in accordance with the regulations of the
Securities and Exchange Commission (the "SEC"), in sending proxies and proxy
materials to the beneficial owners of the Company's Common Stock. Officers or
employees of the Company may also solicit proxies in person, or by mail,
telegram or telephone, but such persons will receive no compensation for such
work, other than their normal compensation as such officers or employees.
You are requested, regardless of the number of shares you hold, to sign the
proxy and return it promptly in the enclosed envelope.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
--------------------------------------------------------------
The table below is based on information obtained from the persons named
therein with respect to the shares of Common Stock beneficially owned, as of the
Record Date (except as noted below), by (i) each person known by the Company to
be the owner of more than 5% of the outstanding shares of Common Stock, (ii)
each director of the Company, (iii) each executive officer of the Company, and
(iv) all executive officers and directors of the Company as a group.
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<TABLE>
<CAPTION>
<S> <C> <C>
NAME AND ADDRESS OF AMOUNT AND NATURE OF PERCENTAGE OF OUTSTANDING
BENEFICIAL OWNER (1) BENEFICIAL OWNERSHIP (2) SHARES OWNED
Gerald Zarin (3) [________] [____%]
Edward Bohn (4) [________] *
Lyle Gramley (5) [________] *
Richard E. Ekstract (6) [________] *
Joseph A. Sarubbi (7) [________] *
Jeremiah F. O'Brien (8) [________] [___%]
Robert Webb (9) [________] [___%]
Helen Burgess [________] [___%]
40 E. 30th St., 10th Fl.
New York, NY 10016
David Kwong [________] [___%]
13694 Fremont Pines Road
Los Altos, CA 94022 (10)
Bruce Meyers [________] [___%]
c/o Janssen-Meyers Associates, L.P.
17 State Street
New York, NY 10004 (11)
Peter Janssen [________] [___%]
c/o Janssen-Meyers Associates, L.P.
17 State Street
New York, NY 10004 (12)
Janssen-Meyers Associates, L.P. [________] [___%]
17 State Street
New York, NY 10004 (13)
All executive officers and directors as a group (7 [________] [___%]
persons) (15)
</TABLE>
* Less than 1%.
(1) Unless otherwise noted, the address of the beneficial owner is:
c/o NUWAVE Technologies, Inc., One Passaic Ave., Fairfield, NJ 07004.
(2) The number of shares of Common Stock beneficially owned by each
person is determined in accordance with the rules of the SEC, and the
information is not necessarily indicative of beneficial ownership for any other
purpose. Under such rules, beneficial ownership includes any shares as to which
the individual has sole or shared voting power or investment power and also any
shares of Common Stock which the individual has the right to acquire within 60
days after the Record Date through the exercise of any stock option, warrant or
other right. The inclusion herein of any shares of Common Stock deemed
beneficially owned does not constitute an admission of beneficial ownership of
those shares. Unless otherwise indicated, the persons named in the table have
sole voting and investment power with respect to all shares of Common Stock
shown as beneficially owned by them.
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<PAGE>
(3) Includes [________] shares subject to exercisable options.
(4) Includes [________] shares subject to exercisable options.
(5) Includes [________] shares subject to exercisable options.
(6) Includes [________] shares subject to exercisable options.
(7) Includes [________] shares subject to exercisable options.
(8) Includes (i) [________] shares subject to exercisable options and
(ii) [_____] shares subject to exercisable warrants held by Mr. O'Brien's wife,
as to which Mr. O'Brien disclaims beneficial interest.
(9) Includes [________] shares subject to exercisable options.
(10) Includes [________] shares of the Company's Common Stock owned by
Prime, as to which Mr. Kwong disclaims beneficial interest. David Kwong, a
former director of the Company, is a director of Prime and owns approximately
[_____]% of Prime's stock.
(11) Includes (i) [________] shares subject to exercisable Class A
Redeemable Warrants, (ii) [________] shares subject to exercisable Unit
Warrants, (iii) [________] shares subject to exercisable Class A Redeemable
Warrants which underlie the Unit Warrants, and (iv) [________] shares of the
Company's Common Stock beneficially owned by Janssen-Meyers, as to which
Mr. Meyers disclaims beneficial interest. Bruce Meyers is a principal of
Janssen-Meyers.
(12) Includes (i) [________] shares subject to exercisable Class A
Redeemable Warrants, (ii) [________] shares subject to exercisable Unit
Warrants, (iii) [________] shares subject to exercisable Class A Redeemable
Warrants which underlie the Unit Warrants, and (iv) [________] shares of the
Company's Common Stock beneficially owned by Janssen-Meyers, as to which Mr.
Janssen disclaims beneficial interest. Peter Janssen is a principal of Janssen-
Meyers.
(13) Includes (i) [________] shares subject to exercisable Unit
Warrants and (ii) [________] shares subject to exercisable Class A Redeemable
Warrants which underlie the Unit Warrants.
(14) See footnotes (1) through (9) above.
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PROPOSAL NO. 1
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APPROVE THE ISSUANCE OF THE COMPANY'S SECURITIES IN A PRIVATE PLACEMENT
AGGREGATING A MINIMUM OF $3,000,000 AND A MAXIMUM OF $6,000,000 TO COMPLY WITH
NASDAQ STOCK MARKET RULE 4310(c)(25)(H)
BACKGROUND
On December __, 1999, the Company entered into a placement agency agreement
(the "Placement Agreement") with Janssen-Meyers Associates, L.P.
("Janssen-Meyers") pursuant to which Janssen-Meyers is acting as the Company's
placement agent in a proposed private placement of the Company's securities in
an aggregate of not less than $3,000,000 and not more than $6,000,000 (the
"Placement"). The Common Stock is listed on the Nasdaq Small Cap Market thereby
the Company is subject to the Nasdaq corporate governance rules. Stockholder
approval of the Placement is being sought in order to comply with Nasdaq Stock
Market Rule 4310(c)(25)(H), which requires a listed company to obtain
stockholder approval when it seeks to issue a number of shares greater than 20%
of its outstanding securities at a purchase price less than the current market
price. The aggregate number of shares of Common Stock which may be issuable upon
the Placement could exceed 20% of the Company's currently outstanding shares and
will be at a purchase price less than the current market price.
THE PRIVATE PLACEMENT
The Placement will consist of units (the "Units") of shares of the
Company's Common Stock together with warrants (the "Warrants") to purchase
one-half share of Common Stock for each share purchased in the Placement. The
Placement will be on a best-efforts basis with minimum proceeds of $3,000,000
and maximum proceeds of $6,000,000. The per share price to investors of the
Common Stock for the initial closing will be 80% of the average closing bid
price for the Company's Common Stock for the eight consecutive trading days from
__________ to ____________ (the "Per Share Price"). The initial closing will
occur when the gross proceeds are at least $3,000,000 and subsequent closings
may be held thereafter. It is intended that the initial closing of the Placement
will occur shortly after Stockholder approval of this Proposal and Proposal No.
2.
Investors will also receive Warrants to purchase a number of shares of
Common Stock equal to 50% of the shares sold in the Placement, exercisable for
three years from the initial closing at an exercise price equal to the Per Share
Price, subject to customary anti-dilution provisions. The Warrants will be
callable at any time commencing one year after the effective date of a
registration statement covering the resale of the securities sold in the
Placement if the Company's Common Stock is trading at least 2.5 times the
exercise price for 30 consecutive business days within five business days prior
to the giving of call notice.
The Company intends to use the proceeds from the Placement for working
capital, including marketing and research and development. [expand?]
The Placement is to be made in reliance upon an available exemption from
registration pursuant to Section 4(2) of the Securities Act of 1933, as amended
(the "Securities Act"), or other appropriate exemption.
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Under the Placement Agreement, for its serving as the placement agent,
Janssen-Meyers will receive a commission of 10% of the gross proceeds from the
sale of the Units in the Placement, as well as a 3% non-accountable expense
allowance (the "Expense Allowance") and reimbursement for legal expenses related
to the Placement, subject to receipt by the Company of appropriate
documentation. The Company paid [$30,000] to Janssen-Meyers upon the signing of
the Placement Agreement, and such advance will be offset against the Expense
Allowance. The Company also agreed to grant to Janssen-Meyers or its designees
warrants to purchase a number of shares of the Company's Common Stock equal to
25% of the number of shares sold in the Placement, exercisable on the same terms
as the Warrants to be sold in the Placement, except they will not be subject to
redemption.
Under the Placement Agreement, the Company and Janssen-Meyers also agreed
to extend their existing Investment Banking Agreement to May 31, 2001.
Janssen-Meyers was also granted a right of first refusal, for a period of 18
months with respect to the sale of certain securities by the Company [subject to
a prior right of first refusal of a third party].
THE PRIOR PRIVATE PLACEMENT AGREEMENT WITH JANSSEN-MEYERS
Between May 19, 1998 and June 9, 1998, the Company closed six private
placements (the "1998 Placements") consisting of units of its Common Stock with
related warrants (the "Units"), with Janssen-Meyers acting as placement agent.
The aggregate amount of the subscriptions for all six closings was
$7,280,546.48, resulting in the sale of 72.801 Units, or a total issuance of
2,742,904 shares of Common Stock and 2,057,207 Class A Redeemable Warrants. The
aggregate net proceeds to the Company were approximately $6,112,950. The Company
used such net proceeds for working capital, including research and development.
Each Unit consisted of: (i) a number of shares of Common Stock determined
by dividing the purchase price per Unit of $100,000 by, for the initial closing
of the Private Placement, $2.59, and, for each subsequent closing, the lesser of
(x) $3.20 and (y) 80% of the Average Closing Bid Price (as defined below); and
(ii) Class A Redeemable Warrants to purchase seventy-five percent (75%) of the
number of shares of Common Stock determined in (i) above at an exercise price of
$3.235. The "Average Closing Bid Price" was the average closing bid price for
the Common Stock for the eight consecutive trading days immediately preceding
the date of a closing of the Private Placement.
For acting as placement agent for the 1998 Placements, Janssen-Meyers
received (i) a 10% commission, (ii) a 3% non-accountable expense allowance,
(iii) reimbursement of other costs, including legal expenses relating to the
1998 Placements, and (iv) 18.2 Unit Warrants to purchase (A) 688,084 shares of
Common Stock at a price per share ranging from $2.50 to $3.06, and (B) 516,068
Class A Redeemable Warrants to purchase 516,068 shares of Common Stock at a
price per share of $3.24. These Unit Warrants are exercisable until May 11,
2003.
At a Special Meeting of Stockholders held on March 19, 1999, the Company's
stockholders ratified the 1998 Placements.
NASDAQ SMALLCAP MARKET STOCKHOLDER APPROVAL REQUIREMENT
Stockholder approval of the Placement is being sought as the aggregate
number of shares of Common Stock which may be issuable upon the Placement could
exceed 20% of the Company's currently outstanding shares and will be at a
purchase price less than the current market price. Assuming a price of $_____
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<PAGE>
per share of the Company's Common Stock for the Placement, the Placement would
result in issuance of __________ shares of Common Stock and Warrants to purchase
_________ shares of Common Stock. These shares would represent approximately
_______% of the shares of the Company's Common Stock presently outstanding.
The Company's Common Stock is traded on the Nasdaq SmallCap Market and the
Company is subject to the Nasdaq corporate governance rules. Nasdaq Stock Market
Rule 4310(c)(25)(H), which governs the Company for so long as its Common Stock
is quoted on such Market, requires that in connection with a transaction other
than a public offering, an issuer must obtain stockholder approval for the sale
or issuance of common stock (or securities convertible into or exercisable for
common stock) equal to 20% or more of the common stock outstanding before the
issuance for less than the greater of book or market value of the stock. Because
the aggregate shares of Common Stock issuable in the Placement may represent
greater than 20% of the Common Stock outstanding before the issuance and they
will be issued at a price lower than market value, the Company is required to
obtain stockholder approval prior to such issuance.
The Company's Board of Directors has determined that the proposed Placement
will further the best interests of the Company because the proceeds from the
Placement will be an integral part of the Company's ability to implement its
business plans and therefore the Board unanimously approved the Placement. The
Company's Board of Directors now recommends that the Company's Stockholders vote
to approve the Placement. Approval by a majority of the votes cast by the
holders of shares entitled to vote thereon will be required to approve this
Proposal.
FOR THE ABOVE REASONS, THE BOARD OF DIRECTORS RECOMMENDS THAT
STOCKHOLDERS VOTE "FOR" PROPOSAL NO. 1.
PROPOSAL NO. 2
--------------
AMENDMENT TO THE COMPANY'S CERTIFICATE OF INCORPORATION TO INCREASE THE
AUTHORIZED SHARES OF COMMON STOCK BY 20,000,000 SHARES TO 40,000,000 SHARES.
The Company's Board of Directors has unanimously approved and recommends to
the Stockholders the adoption of an amendment to Article Fourth, Section 1 of
the Company's Certificate of Incorporation (the "Amendment") to increase the
number of shares of Common Stock that the Company is authorized to issue from
20,000,000 shares to 40,000,000 shares.
Pursuant to the proposed Amendment, Article Fourth, Section 1 will be
amended to read as follows:
"FOURTH:
1. AUTHORIZED CAPITAL. THE TOTAL NUMBER OF SHARES OF ALL CLASSES OF
-------------------
CAPITAL STOCK WHICH THE CORPORATION HAS AUTHORITY TO ISSUE IS 42,000,000
SHARES, PAR VALUE $.01 PER SHARE, CONSISTING OF (I) 40,000,000 SHARES OF
COMMON STOCK, PAR VALUE $.01 PER SHARE (THE "COMMON STOCK") AND (II)
2,000,000 SHARES OF PREFERRED STOCK, PAR VALUE $.01 PER SHARE (THE
"PREFERRED STOCK")."
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<PAGE>
BACKGROUND OF THE AMENDMENT
As of the Record Date of this Proxy Statement, there were ___________
shares of the Company's Common Stock issued and outstanding and no shares of
Preferred Stock outstanding. In addition, _____________shares of Common Stock
were reserved for issuance pursuant to presently issued and outstanding options,
warrants and similar rights, thereby leaving ___________ shares of Common Stock
available for future issuances. Additionally, in order to comply with
anti-dilution provisions of existing warrants and stock option plans and
agreements the Company may have to increase the number of reserved shares of
Common Stock. All of the outstanding shares of Common Stock are validly issued,
fully paid and non-assessable.
Prompted by the proposed Placement discussed in Proposal No. 1, above, and
because the Placement could result in the issuance of _________ shares of the
Company's Common Stock, and the reservation of ________ shares of the Company's
Common Stock to underlie the Warrants related to the Placement, the Company's
Board of Directors has decided that the Company should increase the authorized
shares of the Company's Common Stock from 20,000,000 shares to 40,000,000
shares. Assuming the closing of the Placement for the maximum number of Units
and the adoption of the Amendment, the Company would have _________ shares
outstanding, _________ shares reserved for issuance and _________ shares
available for future issuance.
INCREASE IN AUTHORIZED NUMBER OF SHARES OF COMMON STOCK
Management believes that, in addition to permitting the issuance of shares
for the Placement discussed in Proposal No. 1, this Amendment would benefit the
Company by providing greater flexibility to the Board of Directors to issue
additional equity securities, for example, to raise additional capital, to
facilitate possible future acquisitions, to provide stock-related employee
benefits, and to further other proper corporate purposes. Other than the
Placement, no other such issuance of securities is currently being contemplated
by the Company.
If the Amendment is approved at the Special Meeting, generally, no
stockholder approval would be necessary for the issuance of all or any portion
of the additional shares of Common Stock unless required by law or any rules or
regulations to which the Company is subject. However, as long as the Common
Stock is quoted for trading on the Nasdaq SmallCap Market, the flexibility that
this Amendment would provide the Board of Directors will be limited by the rules
of such market which, as presently in effect, would generally require
stockholder approval for the issuance of Common Stock when: (i) a stock option
or purchase plan is to be established, or any other arrangements made, pursuant
to which Common Stock may be acquired by directors or officers, except for
warrants or rights issued generally to security holders of the Company or
broadly-based plans or arrangements including other employees; (ii) the issuance
would result in a change in control of the Company; (iii) the stock or assets of
another company are acquired if any director, officer, or substantial
stockholder of the Company has a 5% or greater interest (or such persons
collectively have a 10% or greater interest), directly or indirectly, in the
company or assets to be acquired or in the consideration to be paid in the
transaction or series of related transactions and the present or potential
issuance of Common Stock, could result in securities convertible into or
exercisable for Common Stock, could result in an increase in outstanding common
shares or voting power of 5% or more; or where, due to the present or potential
issuance of Common Stock, or securities convertible into or exercisable for
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Common Stock, other than a public offering for cash (A) the Common Stock has or
will have upon issuance voting power equal to or in excess of 20% of the voting
power outstanding before the issuance of stock or securities convertible into or
exercisable for Common Stock; or (B) the number of shares of Common Stock to be
issued is or will be equal to or in excess of 20% of the number of shares of
Common stock outstanding before the issuance of the stock or securities; or (iv)
in connection with a transaction other than a public offering involving the sale
or issuance by the Company of Common Stock (or securities convertible into or
exercisable for Common Stock) at a price less than the greater of book or market
value which alone or together with sales by officers, directors, or substantial
stockholders of the Company equals 20% or more of the Common Stock or 20% or
more of the voting power outstanding before the issuance for less than the
greater of book or market value of the stock.
Depending upon the consideration per share received by the Company for any
subsequent issuance of Common Stock, such issuance could have a dilutive effect
on those Stockholders who paid a higher consideration per share for their stock.
Also, future issuance of Common Stock will increase the number of outstanding
shares, thereby decreasing the percentage ownership in the Company (for voting,
distributions, and all other purposes) represented by existing shares of Common
Stock. The availability for issuance of the additional shares of Common Stock
and also of the presently authorized shares of Preferred Stock may be viewed as
having the effect of discouraging an unsolicited attempt by another person or
entity to acquire control of the Company. Although the Board of Directors has no
present intention of doing so, the Company's authorized but unissued Common
Stock or Preferred Stock could be issued in one or more transactions that would
make a takeover of the Company more difficult or costly, and therefore less
likely. The Company is not aware of any person or entity who is seeking to
acquire control of the Company.
Holders of Common Stock do not have any conversion, preemptive or other
subscription rights to acquire any additional securities issued by the Company,
and there are no redemption provisions applicable to the Common Stock. To date,
the Company has not declared or paid any dividends on its Common Stock. The
payment by the Company of dividends, if any, is within the discretion of the
Board of Directors and will depend on the Company's earnings, if any, its
capital requirements and financial condition, as well as other relevant factors.
The Board of Directors does not intend to declare any dividends in the
foreseeable future, but instead intends to retain earnings for use in the
Company's business operations. The holders of Common Stock are entitled to one
vote for each share held of record on all matters to be voted on by
Stockholders. There is no cumulative voting with respect to the election of
directors, with the result that the holders of more than 50% of the shares
voting for the election of directors can elect all of the directors then up for
election. The holders of Common Stock are entitled to receive ratably such
dividends when, as and if declared by the Board of Directors out of funds
legally available therefor. In the event of liquidation, dissolution or winding
up of the Compnay, the holders of Common Stock are entitled to share ratably in
all assets remaining which are available for distribution to them after payment
of liabilities and after provision has been made for each class of stock, if
any, having preference over the Common Stock. such as the Preferred Stock.
Adoption of this Proposal requires the affirmative vote of the holders of a
majority of the outstanding shares of Common Stock on the Record Date. If
approved by the Stockholders, the increase in the number of authorized shares
will become effective upon the filing with the Secretary of State of the State
9
<PAGE>
of Delaware of a Certificate of Amendment to the Certificate of Incorporation
setting forth such increase.
FOR THE ABOVE REASONS, THE BOARD OF DIRECTORS RECOMMENDS
THAT STOCKHOLDERS VOTE "FOR" PROPOSAL NO. 2.
STOCKHOLDER PROPOSALS FOR THE 2000 ANNUAL MEETING
-------------------------------------------------
The next annual meeting of stockholders of the Company is expected to be
held in June, 2000 (the "2000 Annual Meeting"). Any stockholder who wishes to
present a proposal for action at such meeting must comply with the applicable
rules and regulations of the Securities and Exchange Commission (the
"Commission") then in effect, and the Company's Bylaws. In accordance with
regulations issued by the Commission, stockholder proposals intended for
presentation at the next annual meeting of stockholders must be received by the
Secretary of the Company no later than February 4, 2000, if such proposals are
to be considered for inclusion in the Company's proxy statement for the next
annual meeting of stockholders.
The proposal must be in accordance with the provisions of Rule 14a-8
promulgated by the Securities and Exchange Commission under the Securities
Exchange Act of 1934, as amended. The Company suggests that any such request be
submitted by certified mail-return receipt requested. The Board of Directors
will review any proposal which is received by February 4, 2000, and determine
whether it is a proper proposal to present to the 2000 Annual Meeting.
Stockholder proposals should be submitted to: Jeremiah F. O'Brien,
Secretary, NUWAVE Technologies, Inc., One Passaic Avenue, Fairfield, New Jersey
07004.
OTHER MATTERS
-------------
The Board is not aware of any matters to be presented at the Special
Meeting other than the matters described herein and does not intend to bring any
other matters before the Special Meeting. However, if any other matters should
come before the Special Meeting, or any adjournments or postponements thereof,
the persons named in the proxies will have discretionary authority to vote all
proxies in accordance with their best judgment.
By Order of the Board of Directors,
Gerald Zarin
Chairman
Fairfield, New Jersey
December ____, 1999
10
<PAGE>
PRELIMINARY COPIES
------------------
NUWAVE TECHNOLOGIES, INC.
-------------------------
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
-----------------------------------------------------------
The undersigned stockholder of NUWAVE Technologies, Inc. (the "Company")
acknowledges receipt of the Notice of Special Meeting of Stockholders and Proxy
Statement, dated _______________, and hereby appoint(s) Gerald Zarin and
Jeremiah F. O'Brien, and each of them, as Proxies, with full power of
substitution, and hereby authorizes them to represent and vote, as designated
below, all shares of Common Stock, which the undersigned would be entitled to
vote at the Special Meeting, or at any adjournment or postponement thereof,
hereby revoking any proxy heretofore given and ratifying and confirming all that
said proxies may do or cause to be done by virtue thereof with respect to the
following matters:
1. Approve the private placement of shares of the Company's Common Stock
and related warrants to fulfill Nasdaq Stock Market Rule
4310(c)(25)(H).
FOR AGAINST ABSTAIN
[ ] [ ] [ ]
2. Approve an amendment to the Company's Certificate of Incorporation to
increase the authorized shares of Common Stock to 40,000,000 shares.
FOR AGAINST ABSTAIN
[ ] [ ] [ ]
3. In their discretion, the Proxies are authorized to vote upon such
other business as may properly come before the Special Meeting.
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED AS
DIRECTED HEREIN BY THE UNDERSIGNED STOCKHOLDER.
IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED
"FOR" PROPOSALS NOS. 1 AND 2.
Please sign and date this proxy where shown below and return it promptly:
Date: , 2000
-------------------
Signed:
SIGNATURE:
------------------------------------------------------
SIGNATURE IF HELD JOINTLY:
--------------------------------------
Please sign exactly as name appears hereon. If the stock is registered in
the names of two or more persons, each should sign. Executors, administrators,
trustees, guardians, attorneys, and corporate officers should add their titles.
