<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a)
of the Securities Exchange Act of 1934
<TABLE>
<S> <C>
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted
by Rule 14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section240.14a-11(c) or
Section240.14a-12
ZEROPLUS.COM, INC.
-----------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
-----------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the
Registrant)
</TABLE>
Payment of Filing Fee (Check the appropriate box):
<TABLE>
<S> <C> <C>
/X/ No fee required.
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(1)
and 0-11.
(1) Title of each class of securities to which transaction
applies:
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(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 the
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.
/ / 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:
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(4) Date Filed:
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</TABLE>
<PAGE>
November 8, 2000
Dear Shareholder:
You are invited to attend the Annual Meeting of Shareholders of
zeroplus.com, Inc. (the "Company"), which will be held on Friday, December 8,
2000 at 10:00 a.m., at the Embassy Suites Hotel, 4300 Military Road, N.W.,
Washington, D.C. 20015.
The proposals before the meeting for the election of seven directors and
ratification of the Company's appointment of independent auditors are described
more fully in the Proxy Statement and are deemed by management and the Board of
Directors to be in the best interests of the Company. We believe they deserve
your support.
We ask that you complete, sign and date the accompanying proxy card and
return it as soon as possible in the postage-paid envelope provided. Please do
so even if you intend to be at the meeting.
Thank you very much for your loyal support of our past efforts. We look
forward to sharing the benefits with you as a shareholder of the Company.
ALONZO E. SHORT
CHAIRMAN OF THE BOARD
ROBERT A. VESCHI
PRESIDENT AND CHIEF EXECUTIVE OFFICER
<PAGE>
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To the Shareholders of zeroplus.com, Inc.:
The Annual Meeting of Shareholders of zeroplus.com, Inc., a Delaware
corporation (the "Company"), will be held on Friday, December 8, 2000, at
10:00 a.m., at the Embassy Suites Hotel, 4300 Military Road, N.W., Washington,
D.C. 20015, for the following purposes:
1. To elect seven directors of the Company, each to serve until the next
Annual Meeting of Shareholders and his or her successor has been elected
and qualified or until his or her earlier resignation or removal;
2. To ratify the appointment of Grant Thornton LLP as the Company's
independent auditors for fiscal year 2001; and
3. To transact such other business as may properly come before the meeting
or any adjournments thereof.
Your attention is directed to the accompanying Proxy Statement for further
information with respect to the matters to be acted upon at the meeting.
The record date for determining shareholders entitled to notice of, and to
vote at, the Annual Meeting has been fixed by the Board of Directors as the
close of business on November 6, 2000.
This notice and the accompanying Proxy Statement and proxy card are sent to
you by order of the Board of Directors.
DONALD J. SHOFF
VICE PRESIDENT, FINANCE, CHIEF
FINANCIAL OFFICER AND SECRETARY
November 8, 2000
You are cordially invited to attend the Annual Meeting. It is important that
your shares be represented regardless of the number you own. EVEN IF YOU PLAN TO
BE PRESENT, YOU ARE URGED TO COMPLETE, SIGN, DATE AND RETURN THE ENCLOSED PROXY
PROMPTLY IN THE ENVELOPE PROVIDED. If you attend this meeting, you may vote
either in person or by your proxy. Any proxy given may be revoked by you in
writing or in person at any time prior to the exercise thereof.
<PAGE>
ZEROPLUS.COM, INC.
12800 MIDDLEBROOK ROAD, SUITE 400
GERMANTOWN, MARYLAND 20874
PROXY STATEMENT
FOR
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD DECEMBER 8, 2000
GENERAL INFORMATION
The following information is being furnished in connection with the Annual
Meeting of Shareholders of zeroplus.com, Inc., a Delaware corporation (the
"Company"), to be held at 10:00 A.M. on Friday, December 8, 2000 at the Embassy
Suites Hotel, 4300 Military Road, N.W., Washington, D.C. 20015 (the "Annual
Meeting"). It is contemplated that this Proxy Statement and the enclosed form of
proxy will be first sent to shareholders on or about November 10, 2000.
Only holders of record of the Company's common stock, par value $0.01 per
share ("Common Stock") at the close of business on November 6, 2000 (the "Record
Date") are entitled to notice of and to vote at the meeting or any adjournment
thereof. On such date, there were 10,463,974 shares of Common Stock outstanding.
The holders of a majority of the Company's outstanding shares of Common Stock,
present in person or by proxy, are required for a quorum at the meeting. If a
share is represented for any purpose at the meeting, it is deemed to be present
for quorum purposes for all other matters as well. Abstentions and shares held
of record by a broker or its nominee ("Broker Shares") that are voted in any
matter are included in determining the number of votes present or represented at
the meeting. Broker Shares that are not voted on any matter at the meeting will
not be included in determining whether a quorum is present. Each share of Common
Stock is entitled to one vote on all matters to come before the meeting. The
election of directors requires the affirmative vote of holders of a plurality of
the shares of Common Stock present in person or represented by proxy at the
Annual Meeting and entitled to vote. Votes that are withheld and Broker Shares
that are not voted as to any such matter will not be included in determining the
number of votes cast.
The enclosed proxy for the Annual Meeting is being solicited by the Board of
Directors of the Company and is revocable at any time before it is exercised.
All properly executed proxies delivered pursuant to this solicitation will be
voted at the meeting in accordance with instructions, if any. In the absence of
instructions, properly executed proxies will be voted for the nominees to the
Board set forth below and for the other proposals described below. If any other
matters are properly brought before the Annual Meeting the proxies will be voted
in the discretion of the proxy holders. The cost of this solicitation will be
borne by the Company. In addition to the use of the mail, directors, officers
and employees of the Company may solicit proxies by telephone, fax, or personal
interview. Such persons will receive no additional compensation for any
solicitation activities. The Company also has retained the services of D.F.
King & Co., Inc. to aid in the solicitation of proxies in person, by mail,
telephone or telegram at a fee of approximately $5,000 plus expenses. Banks,
brokerage houses and other institutions, nominees and fiduciaries will be
requested to forward the soliciting materials to beneficial owners and to obtain
authorization for the execution of proxies. The Company will, upon request,
reimburse such parties for their reasonable expenses in forwarding proxy
material to beneficial owners.
ELECTION OF DIRECTORS
DIRECTORS
Seven directors are to be elected at the 2000 Annual Meeting, each for a
term running until the 2001 Annual Meeting of Shareholders and his or her
successor has been elected and qualified, or his or
1
<PAGE>
her earlier resignation or removal. It is the intention of the persons named as
proxies in the accompanying form of proxy to vote for the election of the seven
named nominees of the Board of Directors unless authorization is withheld. Each
nominee has agreed to serve if elected. In the event any nominee shall
unexpectedly be unable to serve, the Board may reduce its size or nominate an
alternative candidate for whom the proxies may vote.
The name, principal occupation and selected biographical information of each
nominee are set forth below. All nominees currently are directors of the
Company.
ALONZO E. SHORT, JR., Lt. Gen., USA (ret.), 59, has been chairman of the
board since January 1996. General Short has more than 30 years experience in
executive management, operations and the engineering, design and development of
large-scale telecommunications and data systems. General Short retired from the
service in 1994 following a career that included serving as deputy commanding
general (1988-1990) and commanding general (1990-1991) of the U.S. Army
Information Systems Command, a major information technology organization, which
was responsible for all telecommunications during the Desert Shield/Desert Storm
operation, among other responsibilities. From 1991 to 1994, General Short was
director of the Defense Information Systems Agency, a major information
technology organization which is responsible for telecommunications and related
services to the President of the United States, Secret Service, Joint Chiefs of
Staff, Secretary of Defense, among other high level federal entities. From
1994-1997, General Short was president and chief executive officer of MICAH
Systems, Inc., a Washington, D.C. metropolitan area based information,
technologies management and consulting firm. In September 1997, General Short
joined Lockheed Martin, an aerospace, defense, and information technology
company, as a Vice-President. Since January 1996, General Short has been
instrumental in the organization and development of the Company's business.
ROBERT A. VESCHI, 38, has been the Company's president, chief executive
officer, and a director since January 1995. Mr. Veschi founded the Company,
which began its operations in June 1995. Mr. Veschi has significant experience
in executive management, operations and the engineering, design and development
of telecommunications and computer products and systems. From 1986 to 1990,
Mr. Veschi was manager of systems engineering for International
Telemanagement, Inc., a Washington, D.C. metropolitan area based information,
data and network systems firm. From 1990 to 1994, Mr. Veschi was a group
president of I-Net, Inc., a Washington, D.C. metropolitan area based
information, data and network systems firm. From December 1994 to May 1995, for
approximately six months, Mr. Veschi was president and chief executive officer
of Octacom, Inc., a Washington, D.C. metropolitan area based information, data
and network systems firm, and a wholly-owned subsidiary of Octagon, Inc., an
Orlando, Florida metropolitan area based publicly held technical services firm.
From July 1994 to May 1995, for approximately nine months, Mr. Veschi was a vice
president of telecommunications for Octagon, Inc., and from January 1995 to
May 1995, for approximately four months, Mr. Veschi was a member of the board of
directors of that company. Since June 1995, Mr. Veschi has been instrumental in
the Company's organization, development and promotion. Mr. Veschi is the son of
Robert L. Veschi, the Company's executive vice president for business
development.
WILLIAM W. ROGERS, JR., 58, has been a director since January 1997.
Mr. Rogers has substantial senior management, operations and technical and
engineering services experience. From 1972 to 1987, Mr. Rogers was a general
manager engaged in operations, technical and engineering services for Boeing
Computer Services, Inc. From 1987 to 1989, Mr. Rogers was president and chief
executive officer of International Telemanagement, Inc., a McLean, Virginia
based telecommunications and systems engineering and services company. From 1989
to 1991, Mr. Rogers was a vice president of Fluor-Daniel, where he was
responsible for telecommunications and systems integration services. From 1991
through 1998, Mr. Rogers was a vice president with Computer Sciences
Corporation, a McLean, Virginia based technology products, systems and services
company, where he is responsible for systems integration and related technical
services. From 1998 to 1999, Mr. Rogers was a senior vice president of
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<PAGE>
CACI, Inc., a Washington, D.C. based information technology company. Since
October 1999, Mr. Rogers has been Director-Sales of Advanced Communication
Systems, Inc., a Washington, D.C. based information technology company. Since
January 1997, Mr. Rogers has been instrumental in the Company's organization and
development. Mr. Rogers holds a B.A. degree from West Virginia University.
WILLIAM L. HOOTON, 49, has been a director since January 1996. Mr. Hooton
has substantial experience in the management, design, operation, marketing and
sales of image conversion systems, electronic imaging system integration, data
automation and high performance data storage subsystems. From 1990 to 1993,
Mr. Hooton was vice president of operations and technical and business
development of the Electronic Information Systems Group of I-Net, Inc., a
Washington, D.C. metropolitan area based information, data and network systems
firm. From 1993 to 1998, Mr. Hooton was president and chief executive officer of
Q Corp., a Washington, D.C. metropolitan area high technology consulting firm
specializing in digital imaging systems and other complex imagery in media. From
1998 to 2000, Mr. Hooton was chief executive officer of Tower Software
Corporation, a Northern Virginia based records management software company. In
August 2000, Mr. Hooton became a Corporate Vice President with Science
Applications International Corporation, a La Jolla, California based
international systems engineering firm. Since January 1996, Mr. Hooton has been
a director of the Company and has been instrumental in its organization and
development. Mr. Hooton holds a B.B.A. degree from the University of Texas.
CLIVE G. WHITTENBURY, Ph.D., 67, has been a director since June 1996.
Dr. Whittenbury has substantial senior management, operations and technical
advisory experience. From 1972 to 1979, Dr. Whittenbury was a senior vice
president and, from 1976 to 1986, a director of Science Applications
International Corporation, a La Jolla, California based international systems
engineering firm. Since 1979, Dr. Whittenbury has been executive vice president
and a director of the Erickson Group, Inc., a major international diversified
products firm. Dr. Whittenbury is a member of the International Advisory Board
for the British Columbia Advanced Systems Institute, which manages
commercialization programs in technology at the three major Vancouver/Victoria
universities, a member of the Advisory Board of Compass Technology Partners, an
investment fund, and is a member of the NIF Programs Review Committee (NIF
Directorate) for the Lawrence Livermore National Laboratory, University of
California. Dr. Whittenbury has also served as a technical advisor to three U.S.
Congressional Committees, the Grace Commission and numerous major U.S. and
foreign companies. Since June 1996, Dr. Whittenbury has been instrumental in the
Company's organization and development. Dr. Whittenbury holds a B.S. degree
(physics) from Manchester University (England) and a Ph.D. degree (aeronautical
engineering) from the University of Illinois.
MICHAEL A. VIREN, Ph.D, 58, has been a director since December 1999.
Dr. Viren has over 35 years of experience as an engineer, economist and
executive in the electric utilities and telecommunications industries. From 1991
to 1998, Dr. Viren served as the Director of Product Development, Vice President
of Product Development and Information Services and Senior Vice President of
Engineering, IS and Strategic Planning for Intermedia Communications, Inc., an
interexchange and internet company located in Florida. In 1998, Dr. Viren, along
with several Intermedia employees, founded 2nd Century Communications, a
telecommunications service provider located in Tampa, Florida. In July 1999,
Dr. Viren resigned from his position with 2nd Century, though he currently
serves on its board of directors. Dr. Viren received a Bachelor of Science in
Mechanical Engineering from California State University, Long Beach and a Ph.D.
in Economics from the University of Kansas in December 1970.
DONALD J. SHOFF, CPA, 45, has been a director since December 1999.
Mr. Shoff has been vice president of finance and chief financial officer since
November 1997 and secretary since February 1999. Prior to that, Mr. Shoff was
director of finance and assisted the Company as a consultant prior to
employment. Mr. Shoff has 21 years of significant experience in both public
accounting firms and with
3
<PAGE>
high technology companies, both public and private. From 1977 to 1981,
Mr. Shoff was a staff accountant and senior accountant on the staff of local
Washington, D.C. public accounting firms. From 1982 to 1986, Mr. Shoff was the
corporate cost accounting manager and a group controller for Science
Applications International Corporation, an international systems engineering
firm, where he was responsible for the corporate cost accounting functions and
controllership of a high technology services operation group. From 1987 to 1992
and from 1993 to 1996, Mr. Shoff consulted independently and as a Senior Manager
of Grant Thornton LLP, a major accounting and management consulting firm, with
public and privately held high technology companies doing business with the
Federal government. From 1992 to 1993 Mr. Shoff was vice president of finance
and administration for Comsis Corporation, a Washington, D.C. based privately
held engineering and technology company doing business with the Federal and
various state governments. Mr. Shoff holds a B.B.A. degree from the Pennsylvania
State University and is a certified public accountant.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE ELECTION TO THE BOARD OF
DIRECTORS OF THE NOMINEES SET FORTH ABOVE.
EXECUTIVE OFFICERS
The name, principal occupation and selected biographical information of the
executive officers of the Company (other than Robert A. Veschi and Mr. Shoff)
are set forth below:
ROBERT L. VESCHI, 60, was named executive vice president for business
development in July 2000. Mr. Veschi has more than 30 years of top information
technology experience in both private industry and the federal government, and
has successfully created and built several Corporate Information Technology
company divisions. Prior to joining the Company, Mr. Veschi was a consultant for
several high technology companies, including the Company. From 1997 to 1999,
Mr. Veschi was Executive Vice President of Affiliated Computer Systems (ACS) and
ACS Government Solutions. During 1997 Mr. Veschi served as President of CDSI
Solutions, a division of Computer Data Systems, Inc. From 1985 to 1996,
Mr. Veschi held several senior executive positions with Lockheed Martin
Corporation and served as President of its Integrated Business Solutions
division immediately prior to his retirement from Lockheed Martin. From 1958 to
1985, Mr. Veschi worked as a civilian with the Department of Defense, where he
helped develop the Army's Test and Experimentation Command (TEXCOM) information
technology infrastructure. Mr. Veschi later headed the TEXCOM information
services organization and was subsequently named Director of Automation
Services. Mr. Veschi holds a Bachelor of Science degree in Computer Science from
American Technological University and is a graduate of the Defense Systems
Management College. Mr. Veschi is the father of Robert A. Veschi, the Company's
president, chief executive officer and director.
LAWRENCE W. MITCHELL, 36, was named vice president and general counsel in
October 2000. Mr. Mitchell has 11 years of broad corporate legal experience both
in high-tech companies and in private legal practice. From 1998 until joining
the Company, Mr. Mitchell was Vice President and General Counsel of KSI Inc., a
developer of wireless telecommunications technology. From 1992 to 1997 he held
senior in-house counsel positions with Gould Electronics Inc., a multinational
manufacturer of electronic materials and components. From 1989 to 1992
Mr. Mitchell worked in private practice with the law firm of Cummings & Lockwood
in Stamford, Connecticut. Mr. Mitchell holds a Juris Doctor degree from The Ohio
State University College of Law and a Bachelor of Arts degree in Economics from
the University of Cincinnati.
4
<PAGE>
INDEBTEDNESS AND OTHER TRANSACTIONS
During the past two years, none of the Company's directors or executive
officers, or any member of their immediate families, has or had any material
interest in any transaction to which the Company is or was a party outside of
the ordinary course of the Company's business, except as follows.
The Company rents an aircraft for business purposes from an entity owned by
Robert A. Veschi, the Company's President and Chief Executive Officer. For the
years ended March 31, 2000 and 1999, the Company paid $187,519 and $199,060,
respectively for the rental of the aircraft.
On April 16, 1997, the Company entered into a consulting agreement with
Alonzo E. Short, Jr., Lt. Gen., USA (ret.), the Chairman of the Board, to
provide services for a fixed monthly amount of $1,000. The amounts paid to him
under that agreement totaled $12,000 for the years ended March 31, 2000 and
1999, respectively.
All ongoing and future transactions between the Company and any affiliate
will be entered into on terms at least as favorable as could be obtained from
unaffiliated, independent third parties.
MEETINGS AND COMMITTEES
During the Company's fiscal year ended March 31, 2000, the Board of
Directors held fourteen meetings. Each director of the Company attended 75% or
more of all meetings of the Board of Directors. The Board has a standing audit
committee composed of Gen. Short, Mr. Rogers and Dr. Whittenbury, a standing
compensation committee composed of Messrs. Hooton, Rogers and Veschi, and a
standing executive committee composed of Gen. Short and Messrs. Hooton and
Veschi. During the Company's fiscal year ended March 31, 2000, the audit
committee held one meeting, the compensation committee held one meeting and the
executive committee held one meeting. The Board has no standing nominating
committee at this time.
STOCK OWNERSHIP OF DIRECTORS AND EXECUTIVE OFFICERS
The table below sets forth the beneficial ownership of Common Stock as of
November 6, 2000 by all directors, the Chief Executive Officer and the other
executive officer of the Company (determined at the end of the last fiscal year)
whose annual salary and bonus as so determined was at least $100,000 (such
officers, the "Named Officers") and all directors and executive officers of the
Company as a group, and each person who is known by the Company to beneficially
own more than five percent of the issued and outstanding shares of Common Stock.
With regard to five percent beneficial owners who are not also directors or
officers of the Company, the information set forth below reflects the most
recent reliable information available to the Company. Unless otherwise indicated
and subject to applicable community property and similar statutes, all persons
listed below have sole voting and investment power over all shares of Common
Stock beneficially owned. Share ownership has been
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<PAGE>
computed in accordance with the Securities and Exchange Commission ("SEC") rules
and does not necessarily indicate beneficial ownership for any other purpose.
<TABLE>
<CAPTION>
NUMBER
NAME AND ADDRESS POSITION WITH COMPANY OF SHARES PERCENTAGE OF SHARES
---------------- -------------------------- --------- --------------------
<S> <C> <C> <C>
Alonzo E. Short, Jr., Chairman of the Board 108,334 1.03
Lt. Gen., USA (ret.) (1)
Robert A. Veschi (2) President, Chief Executive 1,481,835 13.83
Officer, Director
Donald J. Shoff (3) Vice President, Chief 131,084 1.24
Financial Officer and
Secretary, and Director
William L. Hooton (4) Director 68,334 0.65
Clive W. Whittenbury, Ph.D. (5) Director 68,334 0.65
William W. Rogers, Jr. (6) Director 23,334 0.22
Michael A. Viren (7) Director 10,334 0.10
Broadwing, Inc. (8) Shareholder 1,888,653 18.05
All Executive Officers and Directors as 1,913,758 17.58
a Group (9 persons) (9)
</TABLE>
------------------------
(1) 6066 Old Telegraph Road, Alexandria, Virginia 22310. Includes vested options
to purchase 18,334 shares of Common Stock.
(2) c/o zeroplus.com, Inc., 12800 Middlebrook Road, Suite 400, Germantown,
Maryland 20874. Includes vested options to purchase 250,000 shares of Common
Stock.
(3) c/o zeroplus.com, Inc., 12800 Middlebrook Road, Suite 400, Germantown,
Maryland 20874. Includes vested options to purchase 81,084 shares of Common
Stock.
(4) c/o Science Applications International Corporation, 7990 Science
Applications Court, Vienna, Virginia 22183. Includes vested options to
purchase 18,334 shares of Common Stock.
(5) 511 Trinity Avenue, Yuba City, California 95991. Includes vested options to
purchase 18,334 shares of Common Stock.
(6) c/o Advanced Communication Systems, Inc., 10889 Lee Highway, Fairfax,
Virginia 22030. Includes vested options to purchase 18,334 shares of Common
Stock.
(7) 505 South River Hills Drive, Temple Terrace, Florida 33617. Includes vested
options to purchase 10,334 shares of Common Stock.
(8) 201 East Fourth Street, Cincinnati, Ohio 45202.
(9) Includes vested options to purchase 419,923 shares of Common Stock.
6
<PAGE>
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
The following table sets forth certain compensation information for the
fiscal years ended March 31, 1998, 1999 and 2000 with regard to the Named
Officers:
<TABLE>
<CAPTION>
SECURITIES
OTHER ANNUAL UNDERLYING
NAME OF INDIVIDUAL POSITION WITH COMPANY YEAR SALARY BONUS COMPENSATION(1) OPTIONS
------------------ -------------------------- -------- -------- --------- --------------- ----------
<S> <C> <C> <C> <C> <C> <C>
Robert A. Veschi President, Chief Executive 2000 175,000 175,000(2) -- 150,000
Officer, Director 1999 175,000 190,000(2) -- 200,000
1998 175,000 87,500 --
Donald J. Shoff Vice President, Finance, 2000 130,000 25,000 -- 25,000
Chief Financial Officer 1999 125,329 16,500 -- 72,750
and Secretary 1998 95,512 -- --
</TABLE>
------------------------
(1) The officers of the Company may receive remuneration as part of an overall
group insurance plan providing health, life and disability insurance
benefits for employees of the Company. The amount allocable to each Named
Officer cannot be specifically ascertained, but, in any event, did not in
any reported fiscal year exceed the lesser of $50,000 and such Named
Officer's combined salary and bonus. The Company has purchased key-man term
life insurance on Mr. Veschi in the amount of $2 million, which designates
the Company as the owner and beneficiary of the policy.
(2) In the fiscal year ended March 31, 2000, Mr. Veschi received a discretionary
bonus in December 1999 and a contractual bonus in March 2000, both for
$87,500. In the fiscal year ended March 31, 1999, Mr. Veschi received a
discretionary bonus of $15,000, and also received contractual bonuses of
$87,500 payable for each of the two fiscal years ending March 31, 1999 and
1998.
DIRECTOR COMPENSATION
For the fiscal year ended March 31, 2000, the directors of the Company, with
the exception of Mr. Veschi and Mr. Shoff, received remuneration of $24,000
pursuant to oral agreements, and were each awarded options to purchase 10,000
shares of the Company's Common Stock, with an exercise price of the then fair
market value of $4.9079 per share, that vest over a three-year period.
Mr. Viren chose to receive his annual remuneration in the form of additional
options to purchase 7,000 shares of the Company's Common Stock with an exercise
price of the then fair market value of $4.9079 per share. In addition, General
Short receives $1,000 per month under a consulting services agreement for his
additional specific business services on behalf of the Company.
Each outside director of the Company is entitled to receive reasonable
expenses incurred in attending meetings of the Board of Directors of the
Company. The members of the Board of Directors intend to meet at least quarterly
during the Company's fiscal year, and at such other times as duly called. The
Company presently has five outside directors.
7
<PAGE>
OPTION GRANTS IN LAST FISCAL YEAR
The following table sets forth certain information related to the options
granted to the Named Officers during the fiscal year ended March 31, 2000:
<TABLE>
<CAPTION>
NUMBER OF PERCENT OF TOTAL
SECURITIES OPTIONS GRANTED TO
UNDERLYING OPTIONS EMPLOYEES IN
NAME GRANTED FISCAL YEAR EXERCISE PRICE EXPIRATION DATE
---- ------------------ ------------------ -------------- -----------------
<S> <C> <C> <C> <C>
Robert A. Veschi............ 150,000(1) 33% $4.9079 December 11, 2007
Donald J. Shoff............. 25,000(2) 6% 4.5346 October 1, 2007
</TABLE>
------------------------
(1) Options vest equally over three years from grant date.
(2) Options vest equally over three years from grant date.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR END OPTION
VALUES
The following table sets forth certain information related to option
exercises by the Named Officers during the fiscal year ended March 31, 2000 and
the value of their unexercised options at March 31, 2000:
<TABLE>
<CAPTION>
NUMBER OF SECURITIES
UNDERLYING UNEXERCISED VALUE OF UNEXERCISED IN-
SHARES OPTIONS AT THE-MONEY OPTIONS AT
ACQUIRED ON VALUE FISCAL YEAR END (#) FISCAL YEAR END ($)
NAME EXERCISE REALIZED EXERCISABLE/UNEXERCISABLE EXERCISABLE/UNEXERCISABLE
---- ----------- -------- ------------------------- -------------------------
<S> <C> <C> <C> <C>
Robert A. Veschi................... -- -- 133,334/216,666 $332,495/$930,060 (1)
Donald J. Shoff.................... -- -- 72,750/25,000 $426,497/$136,635 (1)
</TABLE>
------------------------
(1) The closing price of the Company's Common Stock at March 31, 2000, as
reported on the Nasdaq SmallCap Market, was $10.0000 per share.
EMPLOYMENT AGREEMENT
The Company has entered into an employment agreement (the "Agreement") with
Robert A. Veschi, the president and chief executive officer of the Company,
dated as of April 1, 1996. The Agreement will expire on March 31, 2001. The
current annual salary under the Agreement is $175,000, which may be increased to
reflect annual cost of living increases and may be supplemented by discretionary
merit and performance increases as determined by the Board of Directors of the
Company. Mr. Veschi is entitled to an annual bonus equal to 50 percent of the
salary provided under this Agreement, which is not subject to any performance
criteria.
The Agreement provides, among other things, for participation in an
equitable manner in any profit-sharing or retirement plan for employees or
executives and for participation in other employee benefits applicable to
employees and executives of the Company. The Agreement provides for the use of
an automobile, payment of club dues and other fringe benefits commensurate with
his duties and responsibilities. The Agreement also provides for benefits in the
event of disability. The Agreement also contains non-compete provisions, which
are limited in geographical scope to the Washington, D.C. metropolitan area.
Pursuant to the Agreement, Mr. Veschi's employment may be terminated by the
Company with cause or by Mr. Veschi with or without good reason. Termination by
the Company without cause, or by Mr. Veschi for good reason, would subject the
Company to liability for liquidated damages in an amount equal to Mr. Veschi's
current salary and a PRO RATA portion of his bonus for the remaining term of the
Agreement, payable in a lump sum cash payment, without any set-off for
compensation received
8
<PAGE>
from any new employment. In addition, Mr. Veschi would be entitled to continue
to participate in and accrue benefits under all employee benefit plans and to
receive supplemental retirement benefits to replace benefits under any qualified
plan for the remaining term of the Agreement to the extent permitted by law.
RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS
The Board of Directors has reappointed Grant Thornton LLP as independent
auditors to audit the consolidated financial statements of the Company and its
subsidiaries for fiscal year 2001. This appointment is subject to ratification
by the shareholders. Grant Thornton LLP has served as independent auditors for
the Company since its incorporation in 1995.
Representatives of Grant Thornton LLP are expected to be present at the
Annual Meeting, where they will have the opportunity to make a statement, if
they desire to do so, and be available to respond to appropriate questions.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" RATIFICATION OF THE
APPOINTMENT OF GRANT THORNTON, L.L.P. AS INDEPENDENT AUDITORS FOR 2001.
OTHER BUSINESS
The Board of Directors does not know of any matters to be presented for
action at the meeting other than those listed in the Notice of Meeting and
referred to in this Proxy Statement. The enclosed proxy confers discretionary
authority, however, with respect to the transaction of any other matters that
may properly come before the meeting, and it is the intention of the persons
named in the proxy to vote in accordance with their judgment on any such matter.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Exchange Act requires the Company's officers and
directors, and persons who own more than ten percent of a registered class of
the Company's equity securities, to file reports and changes in ownership of
such securities with the Company and with the SEC. The following information is
based solely on a review of Forms 3, 4 and 5 and amendments thereto furnished to
the Company pursuant to Rule 16a-3(e) under the Securities and Exchange Act of
1934, as amended, and other information provided to the Company, with respect to
the Company's fiscal year ended March 31, 2000, to the best of the Company's
knowledge and information.
David W. Wells, a former executive officer, sold certain of his shares of
Common Stock on April 15, 15 and 20, 1999, but did not file a Form 4 reflecting
those sales until June 29, 1999.
Michael A. Viren was elected to the Board of Directors on December 20, 1999,
but did not file a Form 3 reflecting that election until March 3, 2000.
SHAREHOLDER PROPOSALS
Proposals of shareholders intended to be presented at the 2001 Annual
Meeting and included in the Company's 2001 Notice of Meeting and Proxy Statement
must be received by the Company no later than July 20, 2001. Director-nominees
and shareholder proposals should be directed to the Secretary of the Company at
its principal office located at 12800 Middlebrook Road, Suite 400, Germantown,
Maryland 20874. Shareholder proposals must comply with the proxy rules of the
Securities and Exchange Commission in order to be included in the Proxy
Statement.
9
<PAGE>
ANNUAL REPORT ON FORM 10-KSB
COPIES OF THE COMPANY'S ANNUAL REPORT ON FORM 10-KSB, WITHOUT EXHIBITS, AS
FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JUNE 29, 2000, ARE
AVAILABLE TO ANY SHAREHOLDER WITHOUT CHARGE UPON REQUEST IN WRITING DIRECTLY TO
DONALD J. SHOFF, VICE PRESIDENT, FINANCE, CHIEF FINANCIAL OFFICER AND SECRETARY
OF THE COMPANY, AT 12800 MIDDLEBROOK ROAD, GERMANTOWN, MARYLAND 20874.
By order of the Board of Directors.
DONALD J. SHOFF
VICE PRESIDENT OF FINANCE, CHIEF
FINANCIAL
OFFICER AND SECRETARY
November 8, 2000
10
<PAGE>
ZEROPLUS.COM, INC.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.
The undersigned hereby appoints Robert A. Veschi and Donald J. Shoff,
and each of them, with full power of substitution, the proxies of the
undersigned to vote all shares of common stock, par value $0.01 per share
("Common Stock") of Zeroplus.com, Inc. (the "Company") which the undersigned
is entitled to vote at the Annual Meeting of Stockholders of the Company to
be held at the Embassy Suites Hotel, 4300 Military Road N.W., Washington,
D.C. 20015 on December 8, 2000, at 10:00 A.M. and at any adjournments or
postponements thereof, with the same force and effect as the undersigned
might or could do if personally present thereat:
(CONTINUED AND TO BE SIGNED ON THE OTHER SIDE.)
<PAGE>
PLEASE DATE, SIGN AND MAIL YOUR
PROXY CARD BACK AS SOON AS POSSIBLE!
ANNUAL MEETING OF STOCKHOLDERS
ZEROPLUS.COM, INC.
DECEMBER 8, 2000
Please Detach and Mail in the Envelope Provided
A /X/ Please mark your
votes as in this
example.
<TABLE>
<S> <C> <C> <C>
FOR all nominees WITHHOLD
listed at right (except AUTHORITY (The Board of Directors
as marked to the to vote for all nominees recommends a vote FOR.)
contrary at right) listed at right
1. ELECTION / / / / NOMINEES: A. Short
OF R. Veschi
DIRECTORS. W. Rogers, Jr.
W. Hooton
(Instruction: To withhold authority to the vote for C. Whittenbury
one or more individual nominees, strike a line M. Viren
through the nominee's name in the list at right.) D. Shoff
FOR AGAINST ABSTAIN
2. PROPOSAL TO RATIFY THE SELECTION OF / / / / / /
GRANT THORNTON LLP as the Company's
independent auditors for fiscal year 2001.
(The Board of Directors recommends a vote FOR.)
3. In their discretion, the proxies are authorized to vote upon such other
business as may properly come before the meeting or any adjournment or
postponement thereof as to which discretionary authority may be granted.
</TABLE>
This proxy, when properly executed, will be voted in the manner directed
herein by the undersigned stockholder. If no direction is made, this proxy
will be voted FOR Proposals I and II. This proxy also confers discretionary
authority with respect to any business as may properly come before the
meeting of any adjournment or postponement thereof as to which discretionary
authority may be granted.
PLEASE MARK, SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY USING THE
ENCLOSED ENVELOPE.
<TABLE>
<S> <C> <C>
Signature Signature if held jointly DATED: , 2000
--------------------- ------------------- -----------
</TABLE>
Note: Please sign exactly as your name appears above. When shares are held by
joint tenants, both should sign. When signing as attorney, executor,
administrator, trustee or guardian please give full title as such. If
a corporation, please sign in full corporate name by president or other
authorized person. If a partnership, please sign in full partnership name
by authorized person. If a limited liability company, please sign in full
limited liability company name by manager or other authorized person.
