SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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
[_] DEFINITIVE PROXY STATEMENT
[_] DEFINITIVE ADDITIONAL MATERIALS
[_] SOLICITING MATERIAL PURSUANT TO RULE 14a-11(c) OR RULE 14a-12
[_] CONFIDENTIAL, FOR USE OF THE COMMISSION ONLY (AS PERMITTED BY RULE
14a-6(c)(2))
STREAMEDIA COMMUNICATIONS, INC.
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(NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
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(NAME OF PERSON(S) FILING PROXY STATEMENT, IF OTHER THAN THE 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)(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:
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(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):
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(4) PROPOSED MAXIMUM AGGREGATE VALUE OF TRANSACTION:
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(5) TOTAL FEE PAID:
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[_] 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: _____________________________________________________
(4) DATE FILED: _______________________________________________________
<PAGE>
STREAMEDIA COMMUNICATIONS, INC.
244 West 54th Street, 7th Floor
New York, NY 10019
---------------------------------------------
NOTICE OF SPECIAL MEETING OF STOCKHOLDERS TO BE
HELD ON OCTOBER 27, 2000
----------------------------------------------
To the Stockholders of Streamedia Communications, Inc.:
NOTICE IS HEREBY GIVEN that a Special Meeting of Stockholders (the "Meeting") of
Streamedia Communications, Inc. (the "Company") will be held at the offices of
the Company, located at 244 West 54th St., 7th Floor, New York, NY 10019, on
October 27, 2000, at 10:00 a.m., local time, to consider and act upon the
following matters:
1. To approve and ratify the issuance and sale of the Company's common
stock, par value $0.001 per share, which could potentially result in
the new investors owning approximately 36.1%(1) of our outstanding
Common Stock.
2. To transact such other business as may properly come before the
Meeting or any adjournment or postponement thereof.
Your attention is directed to the attached Proxy Statement accompanying this
Notice which more fully describes the foregoing proposals.
The Board of Directors has fixed the close of business on September 26, 2000, as
the record date for the determination of Stockholders entitled to receive notice
of and to vote at the Meeting or any adjournment or postponement thereof. Shares
can be voted at the Meeting only if the holder is present at the Meeting in
person or by valid proxy.
The officers and directors of the Company cordially invite you to attend the
Meeting. However, to ensure your representation at the Meeting, you are urged to
mark, date, sign and return the enclosed proxy as promptly as possible in the
postage-prepaid envelope enclosed for that purpose. YOU MAY REVOKE YOUR PROXY IN
THE MANNER DESCRIBED IN THE ACCOMPANYING PROXY STATEMENT AT ANY TIME BEFORE IT
HAS BEEN VOTED AT THE MEETING. ANY STOCKHOLDER ATTENDING THE MEETING MAY VOTE IN
PERSON EVEN IF HE OR SHE HAS RETURNED A PROXY.
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(1) Assuming the maximum offering is sold and the remaining shares to be sold
close at a price of $1.20 per share with a 10% discount.
By Order of the Board of Directors,
/s/ James Rupp
------------------------------------
Director and Chief Executive Officer
New York, New York
September 27, 2000
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STOCKHOLDERS ARE EARNESTLY REQUESTED TO DATE, SIGN AND MAIL THE ENCLOSED PROXY,
WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING. A POSTAGE PAID ENVELOPE IS
PROVIDED FOR MAILING.
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<PAGE>
STREAMEDIA COMMUNICATIONS, INC.
244 West 54th Street, 7th Floor
New York, NY 10019
(212) 445-1700
This Proxy Statement and the accompanying proxy are furnished to the holders of
Common Stock, par value $0.001 per share ("Common Stock"), of Streamedia
Communications, Inc., a Delaware corporation (the "Company"), in connection with
the solicitation of proxies by the Board of Directors of the Company for use at
the Company's Special Meeting of Stockholders to be held at the offices of the
Company, located at 244 West 54th St., 7th Floor, New York, NY 10019, New York,
NY, on October 27, 2000, at 10:00 a.m., local time, and at any and all
adjournments or postponements thereof (the "Meeting") (all holders of Common
Stock entitled to vote at the Special Meeting are referred to herein
collectively as the "Stockholders"). THE ENCLOSED PROXY IS SOLICITED BY THE
BOARD OF DIRECTORS OF THE COMPANY (THE "BOARD").
The purpose of the Meeting will be to consider and vote upon the following
proposals:
1. To approve and ratify the issuance and sale of the Company's common
stock, par value $0.001 per share ("Common Stock"), which could
potentially result in the new investors owning approximately 36.1% of
our outstanding Common Stock.(2)
2. To transact such other business as may properly come before the
Meeting.
This Proxy Statement, together with the Notice of Special Meeting of
Stockholders and the accompanying proxy card, is being first mailed to
Stockholders on or about October 7, 2000.
The solicitation of proxies will initially be made by mail and may
thereafter be made in person or by mail, telephone, telecopy, telegram,
facsimile or other means of communication by the directors, officers and regular
employees of the Company for no additional or special compensation. In addition,
brokerage houses, banks, nominees, trustees, custodians and other fiduciaries
will be requested by the Company to forward proxy solicitation materials for
shares of Common Stock held of record by them to the beneficial owners of such
shares, and such fiduciaries will, upon request, be reimbursed by the Company
for their reasonable out-of-pocket expenses incurred in connection therewith.
The cost of the solicitation of proxies for use at the Meeting will be borne by
the Company.
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(2) Assuming the maximum offering is sold and the remaining shares to be sold
close at a price of $1.20 per share with a 10% discount.
<PAGE>
VOTING RIGHTS AND PROCEDURES
Only Stockholders of record as of the close of business on September 26,
2000 (the "Record Date") are entitled to notice of and to vote at the Meeting.
As of the Record Date, there were issued and outstanding: 4,730,044 shares of
Common Stock. Each holder of Common Stock issued and outstanding on the Record
Date is entitled to one vote for each such share held on each matter to be
considered at the Meeting. As of the Record Date, all issued and outstanding
shares of Common Stock represented a total of 4,730,044 votes.
The holders of a majority of the voting power of all issued and outstanding
shares of the Company's capital stock entitled to vote, present in person or
represented by proxy, shall constitute a quorum at the Meeting. Treasury shares,
if any, will not be voted and are not counted in determining the number of
outstanding shares for voting purposes.
The affirmative vote of the Stockholders having a majority of the voting
power of all shares present, in person or by proxy, and entitled to vote at the
Meeting, voting as a single class, is required to approve and ratify the Private
Placement Proposal.
Abstentions and "broker non-votes" (shares held of record by brokers or
nominees which are not voted on a particular matter because the broker or
nominee has not received voting instructions from the beneficial owner of such
shares and does not have discretionary voting power with respect to that matter)
will be treated as present for purposes of determining the presence of a quorum
for the transaction of business at the Meeting. Abstentions on a matter will be
treated as present on such a matter and, accordingly, will have the same effect
as votes against the Private Placement Proposal. Broker non-votes on a matter
will not be treated as present on such matter and, accordingly, will have no
effect on the outcome of the Private Placement Proposal.
If a proxy card is properly signed and returned to the Company at or prior
to the Meeting, unless subsequently properly revoked, the shares represented by
that proxy card will be voted at the Meeting in accordance with the instructions
specified thereon. If a proxy card is properly signed and returned to the
Company at or prior to the Meeting without voting instructions, it will be voted
"FOR" the Private Placement Proposal. If any other matters are properly
presented at the Meeting, the persons appointed as proxies in the proxy card
will have the discretionary authority to vote or act thereon in accordance with
their best judgment.
Any Stockholder may revoke a proxy at any time before it is exercised,
either by delivering to the Secretary of the Company a written notice of
revocation or a properly signed proxy bearing a later date, or by attending the
Meeting and voting in person. Attendance at the Meeting will not in and of
itself constitute the revocation of a proxy.
SECURITY OWNERSHIP OF PRINCIPAL STOCKHOLDERS AND MANAGEMENT
The following table sets forth, as of the record date, the number and
percentage of outstanding shares of Common Stock beneficially owned by (a) each
person known by the Company to beneficially own more than 5% of such stock, (b)
each director of the
<PAGE>
Company, (c) each of the executive officers of the Company required to be
disclosed pursuant to Item 403(b) of Regulation S-B, and (d) all directors and
executive officers of the Company as a group.
NAME AND ADDRESS OF AMOUNT OF BENEFICIAL PERCENT OF
BENEFICIAL OWNER OWNERSHIP (1) CLASS (1) (2)
------------------------------- -------------------- --------------
James D. Rupp 1,155,000 24.42%
200 Walter Avenue
Hasbrouck Heights, NJ 07604
Gayle Essary 1,427,500 30.18%
5605 Woodview
Austin, TX 78756
Capital Markets Communications 300,000 6.34%
Corp.
287-101 Kinderkamack Rd., #190
Oradell, NJ 07649
Nicholas Malino 150,000 3.17%
250 W. 90th St., #PH2A
New York, NY 10024
David Simonetti 67,500 1.43%
2455 East Sunrise Blvd.
Ft. Lauderdale, FL 33304
Henry Seigel 0 0
205 West 57th St.
New York, NY 10019
Robert Wussler 0 0
7904 Sandalfoot Dr.
Potomac, MD 20854
Robert Shuey, III 0 0
5910 North Centray Expressway
Suite 1480
Dallas, TX 75206
James Schroeder 0 0
143 Cambridge Avenue
Garden City, NY 11530
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All Officers and Directors 3,100,000 65.54%
as a Group
<PAGE>
(1) The Shares set forth on this chart do not include (i) the 1,089,000 shares
issuable upon the exercise of the warrants included in the units which were
sold in the August 24, 1999, private placement; (ii) the 1,240,000 shares
issuable and outstanding upon the exercise of the warrants included in the
units sold in the Company's initial public offering on December 22, 1999;
(iii) the 160,000 underwriter's warrants from the Company's initial public
offering; and (iv) the options issued under the 1999 stock option plan.
(2) Certain of the Shares listed above are owned indirectly by entities
substantially controlled by principal Stockholders of the Company. Of the
total Shares owned by Mr. Rupp, 1,050,000 Shares are owned through his 100%
ownership in Web2Ventures, L.L.C., and 105,000 Shares are owned through his
35% ownership interest of Web2Ventures, L.L.C., in Capital Markets
Communications Corporation. Of the total Shares owned by Mr. Essary,
590,000 Shares are owned by him directly, and 360,000 Shares are owned by
IRI, Inc., of which he has been given voting power over by the Board of
Directors of IRI, Inc. The remaining shares are held in family trusts or by
members of Mr. Essary's immediate family. Mr. Essary does not exercise
direct control over such shares. Capital Markets Communications Corporation
is controlled by Mr. Rupp and Mr. Essary. Mr. Simonetti's Shares are owned
through Projix Corporation, a company of which Mr. Simonetti is the 90%
owner.
In addition, certain officers and directors have been granted the right to
acquire additional shares, so long as they remain in their positions as
directors, and have been issued options pursuant to the 1999 Stock Option Plan.
Mr. Malino has the right to earn an additional 45,000 Shares upon the
achievement of certain business objectives to be determined by the compensation
committee of the Board of Directors. Mr. Malino was issued 63,000 stock options.
Mr. Simonetti was issued 10,000 options, all of which have vested. Mr. Siegel
has the right to acquire 40,000 stock options and Mr. Wussler has the right to
acquire 40,000 stock options. Mr. Schroeder was issued 25,000 options for his
services as a consultant to the Company. None of these options are represented
on the previous principal Stockholder chart.
<PAGE>
PROPOSAL 1
APPROVAL AND RATIFICATION OF THE
PRIVATE PLACEMENT PROPOSAL
The Company is seeking Stockholder approval and ratification, for the
purpose of Rule 4310(c)(25)(G)(i)(d)(2) of the Nasdaq Stock Market, Inc.
("Nasdaq"), in connection with the Company's issuance and sale of 20% or more of
the Common Stock and 20% or more of the Company's voting power in connection
with the private placement of shares of Common Stock, including the issuance of
any securities of the Company as dividends on or otherwise in respect of the
Common Stock in accordance with the terms thereof. The issuance of the Common
Stock could potentially result in the new investors owning approximately 36.1%
of our Common Stock.(3)
The following is a summary of the terms of the proposed private sale of the
Company's Common Stock. This is provided for informational purposes to our
shareholders in connection with this proxy and does not constitute an offer to
sell or a solicitation of an offer to buy any securities of the Company.
Summary
The Company is offering for sale a minimum of $1,000,000 of Shares of
Common Stock and a maximum of up to $3,000,000 of Shares of Common Stock. The
securities are offered pursuant to Regulation D, Rule 506 under the Securities
Act of 1933, as amended (the "Act"), and have not, or in the case of proposed
sales, will not be registered under the Act, and may not be offered or sold in
the United States absent registration or an applicable exemption from
registration. Each Share of Common Stock to be sold will have a purchase price
equal to the lesser of $2.00 per Share or a 20% discount to the closing bid
price per Share, as reported on the Nasdaq SmallCap Market, on the day
immediately preceding the date of each Closing of the Offering. If the Closing
bid price per Share, as reported on the Nasdaq SmallCap Market, on the day
immediately preceding the date of any Closing is less than $1.50 per Share, the
purchase price will be equal to the lesser of $1.20 per Share or a 10% discount
to the Closing bid price per Share, as reported on the Nasdaq SmallCap Market,
on the day immediately preceding the date of such Closing. If the Closing bid
price per Share, as reported on the Nasdaq SmallCap Market, is more than $2.75
per Share on the day immediately preceding the date of any Closing, the purchase
price will be equal to a 25% discount to the Closing bid price per Share, as
reported on the Nasdaq SmallCap Market, on the day immediately preceding the
date of any such Closing.
On June 27, 2000, the Company's Board unanimously approved the private placement
offering described herein.
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(3) Assuming the maximum offering is sold and the remaining shares to be sold
close at a price of $1.20 per share with a 10% discount.
<PAGE>
Reason For Request For Ratification
The Common Stock is listed on the Nasdaq SmallCap Market. Nasdaq Rule
4310(c)(25)(G)(i)(d)(2) (the "Nasdaq 20% Rule") requires stockholder approval
prior to the issuance of designated securities under certain circumstances,
including 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) equal to 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. Under Nasdaq
Rule 4310(c)(25)(G)(vi), the minimum vote which will constitute shareholder
approval shall be a majority of the total votes cast on the proposal in person
or by proxy.
On September 7, 2000, the Company accepted subscriptions for 940,000 Shares of
Common Stock with net proceeds to the Company of $1,128,000. The Company
proposes to offer the remaining $1,872,000 of Shares of Common Stock. In the
event the full amount of shares are sold, the Company will have sold
approximately 36.1% of its shares of voting stock pursuant to the private
placement. As a result, the Company is required to seek ratification from its
shareholders pursuant to the Nasdaq 20% Rule.
Other Terms of the Transaction
Corporate Governance. Pursuant to the Offering Document, the Company's
Board will be expanded at the first Closing from eight persons to nine persons,
and the Placement Agent in the private placement will appoint one designee to
the Board.
Registration Rights. The Company is obligated to use its reasonable "best
efforts" to file with the SEC, within forty-five (45) days following the final
Closing, a registration statement on Form S-3 (or such other form as applicable)
registering the resale of the Shares of Common Stock and the Shares of Common
Stock issuable upon the exercise of the Investment Banking Warrants
(collectively, the "Registrable Securities") to be issued to the Placement
Agent. In addition, the Company has agreed, at the Company's expense, to keep
such registration statement current until the earlier of eighteen months or such
time as all of the Registrable Securities are freely tradable under the
Securities Act. However, in the event the Company obtains a duly executed and
binding letter of intent to enter into a merger agreement within the forty-five
(45) days following the final Closing, the filing of the registration statement
on Form S-3 (or such other form as applicable) registering the resale of the
Registrable Securities shall be required to be filed within thirty (30) days
following the closing of such merger (the "Merger"). In the event the Company is
unable to file or maintain such a registration statement within the 45 days of
the final Closing or within 30 days of the closing of the Merger (as
applicable), the holders of the Shares of Common Stock sold in the private
placement will be entitled to receive such additional number of shares of Common
Stock as shall be equal to 10% of
<PAGE>
the aggregate number of Shares of Common Stock purchased by each such holder in
the private placement.
Transaction Fee. The Company has agreed to pay the Placement Agent a cash
commission equal to 8.5% of the aggregate purchase price of the Shares sold in
the private placement (the Placement Agent Fee). The Company shall pay the
Placement Agent a non-accountable expense allowance equal to 1.5% of the
aggregate purchase price of the Shares sold in the private placement (the
Expense Allowance), plus the reasonable professional fees, anticipated to be no
more than $50,000, and the actual disbursements of counsel to the Placement
Agent (the Counsel Fees). In addition, the Company will issue to the Placement
Agent up to 400,000 warrants (Investment Banking Warrants) upon certain
conditions, each entitling the Placement Agent to purchase one (1) Share of the
Company's Common Stock at an exercise price equal to the closing bid price per
share, as reported on the Nasdaq SmallCap Market, on the day immediately
preceding the date of the first Closing, which shall be exercisable at any time
for five (5) years from the date of the final Closing. The Investment Banking
Warrants shall be issued to the Placement Agent at the final Closing of the
Private Placement.
Impact of the Private Placement on Existing Stockholders
The Company's existing Common Stockholders will have rights which are equal
to those of the new holders of our Common Stock. Stockholders should consider
the following factors in determining whether to vote for the Private Placement
Proposal:
Stockholders are subject to the risk of substantial dilution to their
interests which will result from the issuance of shares of Common Stock. As
a result of the issuance of such Common Stock, the current Stockholders
will own a smaller percentage of the outstanding Common Stock of the
Company.
The Company will issue to the Placement Agent up to 400,000 Investment
Banking Warrants, upon certain conditions, each entitling the Placement
Agent to purchase one (1) Share of the Company's Common Stock at an
exercise price equal to the closing bid price per Share of the Company's
Common Stock, as reported on the Nasdaq SmallCap Market, on the day
immediately preceding the date of the first Closing, which shall be
exercisable at any time for five (5) years from the date of the final
Closing.
Potential Dilution to Current Shareholders
The following chart sets forth the potential dilutive effect which could
result from the sale of $3,000,000 worth of Shares of Common Stock as described
in this Proposal 1:
<PAGE>
<TABLE>
<CAPTION>
Percent of Beneficial
Potential Dilution Ownership After
Number of Shares Proposal 1 Offering (1)
------------------- -----------------------
<S> <C> <C>
Common Stock issued 4,730,044 63.9%
and outstanding as of
August 10, 2000
Total Common Shares issuable 2,673,333 36.1%
under this Proposal 1 securities (2)
Total 7,403,377 100%
</TABLE>
(1) Assuming the maximum offering is sold and the remaining shares to be sold
close at a price of $1.20 per share with a 10% discount.
(2) Based upon a market price of $1.20 per share for the remaining $1,872,000
of Shares to be sold in this offering, resulting in a 10% discount to the
market for each investor. This number is subject to change.
Use of Proceeds
The estimated use of proceeds received by the Company from the Offering is
presented below, providing separately for the Minimum and Maximum Offering. The
following table represents estimates only. The actual amounts may vary from
these estimates.
Use of Funds Minimum Offering Maximum Offering
------------ ---------------- ----------------
Capital Equipment $ 350,000 $ 700,000
Sales, Marketing and $ 75,000 $ 350,000
Promotion
Acquisitions $ 0 $ 565,000
General Corporate Purposes (1) $ 400,000 $1,000,000
Offering Expenses (2) $ 90,000 $ 130,000
Commissions (3) $ 85,000 $ 255,000
----------- ----------
Total $1,000,000 $3,000,000
(1) These funds will be used for the Company's general corporate purposes,
including, without limitation, general and administrative expenses,
salaries and product development.
(2) Represents the Company's estimate of the total accounting and legal fees,
including, without limitation, the professional fees of counsel to the
Placement Agent, which are anticipated to be no more than $50,000, plus the
actual disbursements of counsel
<PAGE>
to the Placement Agent, printing costs and all expenses incurred in
connection with the Offering and the necessary review of the applicable
state and federal securities laws, rules and regulations, and the
preparation and filing of the necessary federal and state securities
filings related to this Offering. Also includes the Placement Agent's
non-accountable expense allowance, equal to 1.5% of the aggregate Purchase
Price of the Shares sold, which would equal $15,000 if the Minimum Offering
is raised and $45,000 if the Maximum Offering is raised.
(3) The Offering is not underwritten. The Offering is being conducted by the
Company on a "best efforts, all or none" basis with respect to the Minimum
Offering, and on a "best efforts" basis thereafter with respect to the
Maximum Offering. In connection with this Offering, the Placement Agent may
utilize the services of licensed broker-dealers who are members of the
NASD. The Placement Agent and the broker-dealers will use their "best
efforts" to sell the Shares offered hereby.
Reasons for the Transaction
The proceeds from the Private Placement Proposal securities offering are
critical to the Company's continued viability. The primary business purposes of
the offering are to be used for general corporate purposes and capital
equipment. The Company has incurred, and expects to continue to incur,
substantial expenses in its operations. The proceeds from Private Placement
Proposal are critical in the continued success and operations of the Company.
External factors also led the Company to seek additional financing, including
the recent volatility in the market for small capitalization stocks.
The Shareholders are being asked to ratify the issuance of the Common
Stock. The affirmative vote of a majority of the Common Shares present, in
person or by proxy, and entitled to vote at the Annual Meeting is required to
approve Private Placement Proposal.
No Appraisal Rights
Under Delaware law, Stockholders are not entitled to appraisal rights with
respect to the Private Placement Proposal.
Required Vote
The affirmative vote of the Stockholders having a majority of the voting
power of all shares present, in person or by proxy, and entitled to vote at the
Meeting, voting as a single class, is required to approve and ratify the Private
Placement Proposal.
Unavailability of Accountants
Representatives of Grant Thornton LLP, Independent Certified Public Accountants,
are not expected to be present at the Special Meeting.
<PAGE>
Incorporation by Reference
The SEC allows the Company to incorporate information by reference into
this proxy statement. This means that we can disclose important information to
you by referring you to another document filed separately with the SEC. The
information incorporated by reference is considered to be a part of this proxy
statement, except for any information that is superseded by other information
that is set forth directly in this document. This proxy statement incorporates
by reference sections in the Company's Registration Statement filed with the SEC
on September 21, 2000, entitled "Management's Discussion and Analysis" and
"Changes in and Disagreements with Accountants on Accounting and Financial
Disclosure" from the documents set forth below. In addition, this proxy
statement also incorporates by reference sections in the Company's Registration
Statement which include the financial statements meeting the requirements of
Regulation S-X, including financial information required by Rule 3-05 and
Article 1 of Regulation S-X with respect to transactions other than that
pursuant to which action is to be taken as described in this proxy statement.
THE BOARD UNANIMOUSLY RECOMMENDS THAT YOU VOTE FOR THE APPROVAL AND RATIFICATION
OF THE PRIVATE PLACEMENT PROPOSAL.
OTHER INFORMATION
The Board is not aware of any other matters, except for those incident to
the conduct of the Meeting, that are to be presented to Stockholders for formal
action at the Meeting. If, however, any other matters properly come before the
Meeting, it is the intention of the persons named in the proxy included herewith
to vote such proxy in accordance with their judgment.
By Order of the Board of Directors
/S/ James Rupp
-----------------------
Chief Executive Officer
<PAGE>
STREAMEDIA COMMUNICATIONS, INC.
BALLOT FOR VOTING AT
SPECIAL MEETING OF STOCKHOLDERS
OCTOBER 27, 2000
THE BOARD OF DIRECTORS RECOMMENDS AN AFFIRMATIVE VOTE FOR PROPOSAL ONE BELOW
1. To ratify the issuance of the Company's Common Stock to new investors which
could potentially result in their owning approximately 36.1% of the
Company's Common Stock.
[ ] FOR [ ] AGAINST
ratifying the issuance ratifying the issuance
of Common Stock of Common Stock
PLEASE ENTER THE NUMBER OF SHARES YOU OWN:_____________SHARES
--------------------------------
Signature of Stockholder
--------------------------------
Name of Stockholder
