SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE
SECURITIES EXCHANGE ACT OF 1934
Filed by the Registrant [X]
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 Sec. 240.14a-11(c) or Sec. 240.14a-12
ADVANCED WIRELESS SYSTEMS, INC.
(Name of Registrant as Specified in its Charter)
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Filed on Behalf of the Board of Directors
(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 14a6(i)(1)
and 0-11.
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of 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.
<PAGE>
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NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
Advanced Wireless Systems, Inc.
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DATE: Wednesday, June 7, 2000
TIME: 10:00 a.m.
PLACE: 927 Sunset Drive
Irving, Texas75061
RETURN PROXIES TO: Advanced Wireless Systems, Inc.
4123 Government Blvd.
Mobile, Alabama 36693
We will vote on:
1. Amending the Articles of Incorporation of the Company to increase the
number of authorized shares that may be issued by the Company in order
to facilitate acquisitions of other companies;
2. Amending the Articles of Incorporation of the Company to eliminate
preemptive rights of shareholders in order to facilitate the issuance
of shares by the Company; and
3. Transacting such other business as may properly come before the
meeting and any adjournment thereof.
Who May Attend and Vote at the Meeting
Shareholders of record at the close of business on May 17, 2000, and valid
proxy holders may attend and vote at the meeting. If your shares are
registered in the name of a brokerage firm or trustee and you plan to attend
the meeting, please obtain from the firm or trustee a letter or other
evidence of your beneficial ownership of those shares to facilitate your
admittance to the meeting.
By Order of the Board of Directors,
Date: May 17, 2000 Monte Julius, President
<PAGE>
PROXY STATEMENT
Your proxy, using the enclosed form, is solicited by the Company's board of
directors for use at a special meeting of shareholders to be held June 7,
2000, and at any adjournment thereof. This proxy statement has information
about the special meeting and was prepared by the Company's management for
the Board of Directors. Your vote at the special meeting is important to us.
Please vote your shares of common stock by completing the enclosed proxy card
and returning it to us at our Mobile office, 4123 Government Blvd., Mobile,
Alabama 36693.
A) GENERAL INFORMATION
The only items of business which management intends to present at the meeting
are listed in the preceding Notice of Special Meeting of Shareholders and are
explained in more detail on the following pages. By returning your signed
proxy, you authorize management to vote your shares as you indicate on these
items of business and to vote your shares in accordance with management's
best judgment in response to proposals initiated by others at the meeting.
1) Changing or Revoking Your Proxy Vote
You may revoke your signed proxy at any time before it is exercised at the
special meeting. You may do this by advising the Company's Secretary in
writing of your desire to revoke your proxy, or by submitting a duly executed
proxy bearing a later date. We will honor the proxy card with the latest
date. You may also revoke your proxy by attending the special meeting and
indicating that you wish to vote in person.
2) Who may Vote
Each shareholder of record at the close of business on May 17, 2000, is
entitled, for each share then held, to one vote on each proposal or item that
comes before the special meeting. On March 31, 2000, the Company had
5,079,059 shares of Common Stock outstanding and entitled to vote at the
meeting.
3) Voting in Person
Although we encourage you to complete and return your proxy to ensure that
your vote is counted, you can attend the special meeting and vote your shares
in person.
4) How your Votes are Counted
We will hold the special meeting if holders of a majority of the shares of
common stock entitled to vote either sign and return their proxy cards or
attend the meeting. If you sign and return your proxy card, your shares will
be counted to determine whether we have a quorum even if you abstain or fail
to vote on any of the matters listed on the proxy card.
If you mark "Abstain" with respect to any proposal on your proxy, your shares
will be counted in the number of votes cast, but will not be counted as votes
for or against the proposal. If a broker or other nominee holding shares
for a beneficial owner does not vote on a proposal, the shares will not be
counted in the number of votes cast.
This proxy statement and the accompanying proxy form were first mailed on or
about May 17, 2000, to shareholders entitled to vote at the meeting.
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Amendments to Articles of Incorporation
Both of the items of business described below are amendments to the articles
of incorporation. The text of both of the proposed amendments themselves is
printed in attached Exhibit A. Proposal 1 amends Article IV of the Articles
of Incorporation, and Proposal 2 adds a new Article VIII. If one of the
Proposals is adopted by the shareholders but the other Proposal is not, we
will file an amendment to the Articles of Incorporation which contains only
the amended Article that is adopted (Article IV, in the case of Proposal 1,
and Article VIII, in the case of Proposal 2).
B) ITEMS OF BUSINESS
Proposal 1: INCREASING OUR NUMBER OF AUTHORIZED SHARES
Our Board of Directors believes that it is necessary to increase the
authorized number of shares of common stock from 50,000,000 shares to
150,000,000 shares. The increase is intended to allow for future issuance of
shares for acquisitions as appropriate, and to allow for stock dividends and
stock splits as appropriate.
Of the currently authorized 50,000,000 shares of common stock, par value $.01
per share, approximately 5,079,059 shares were issued and outstanding on
March 31, 2000. In addition, 3,932,703 authorized, unissued shares were
reserved for issuance pursuant to exercise of options and warrants. Thus, a
total of 40,988,238 shares of our common stock remain authorized and
eligible for issuance after taking into consideration the shares reserved for
exercise of warrants. If the shareholders approve the proposed amendment to
triple the number of authorized shares, 140,988,238 shares will be authorized
and eligible for issuance after taking into consideration the shares reserved
for exercise of warrants.
Our articles of incorporation, bylaws and Alabama corporate law generally
permit the board of directors to approve the issuance of authorized shares
without prior notice to or approval by the shareholders. We have no special
provisions in our articles of incorporation requiring votes of shareholders
to issue new shares. Alabama law only requires the directors to obtain the
approval of shareholders to issue new shares in mergers or in exchange offers
where our shares are being exchanged for shares of another corporation who is
acquiring us.
If the amendment to the articles of incorporation is approved, the directors
will have at their disposal nearly 15.6 times the currently issued number of
shares (fully diluted, including the shares reserved for warrant exercises).
Thus, the directors (without notice to or a vote of the shareholders) could
decide to sell shares to new shareholders for cash or issue shares to new
shareholders in exchange offers to acquire other corporations, which could
have the effect of transferring voting control and percentage ownership out
of the hands of existing shareholders and into the hands of the new
shareholders. This could result in a reduction in the net asset value per
share and fair market value per share of existing shareholders' investments.
Using Shares for Possible Future Acquisitions
We want to increase the number of authorized shares in order to use the
increased shares for acquisitions. We believe that we can expand our
business and achieve profitability by acquiring other businesses, either for
cash or for our stock. We have identified several acquisition candidates, as
described below. Although much remains to be done before we could complete
any of these acquisitions, we believe that at least one, and maybe all, of
the proposed acquisitions may take place. If we make all of these
acquisitions on the terms currently proposed, we would have more than 100
million common shares and warrants to purchase shares outstanding at the
conclusion of the last acquisition. We propose to raise the number of
authorized shares to 150 million to accommodate these acquisitions and to
allow for other acquisitions in the future.
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We have explored acquisitions in both the Internet service/wireless cable
sector and in unrelated business lines. Because fraudulent promotions, like
the one that created Mobile LLC, spawned several similar companies in the
early 1990s, several small companies have the same basic origin and business
plan as ours. These companies have in common:
- - they are owned by a large number of passive investors who are
inexperienced in the Internet/wireless cable business; and
- - they operate Internet or wireless cable systems in a few local markets
where it is hard to succeed as an independent operator.
We hope that, by combining to achieve economies of scale, we can reduce
overhead and increase the services provided by each local business to become
profitable.
We have signed one acquisition agreement and one letter of intent to purchase
the assets of Internet service/wireless cable businesses, and we have signed
letters of intent to acquire three companies in unrelated automotive
businesses. Each of these businesses is described below. At present, we
cannot be sure whether any of these acquisitions will, in fact, be made, for
the reasons described below.
Digital Wireless Systems, Inc.
On February 15, 2000, we executed an agreement to acquire the assets of
Digital Wireless Systems, Inc. ('DWSI'), as part of a plan of reorganization
of DWSI, which is operating as debtor-in-possession under Chapter 11 of the
U.S. Bankruptcy Code. DWSI was created in 1997 to take over the businesses
of two partnerships, one limited liability company and one corporation that
were created in 1993 and 1994 in the same sort of promotion as Mobile LLC,
our predecessor. It provides Direct Broadcast Satellite ('DBS') television
services and operates wireless cable TV and Internet services in Baton Rouge
Louisiana, Clarksville Tennessee, Reading Pennsylvania, and Shreveport
Louisiana.
The disclosure statement that DWSI filed on February 15, 2000, discloses that
DWSI had total tangible assets of $189,000, and total intangible assets of
approximately $1.54 million, of which $1.5 million was listed as the current
market value of DWSI's FCC licenses. The FCC licenses are burdened by a lien
of $728,993. The disclosure statement lists the liquidation value of those
assets, prior to disposition costs and costs of administration, of $813,828.
The disclosure statement lists total claims of approximately $1.26 million,
plus administrative expenses and the lien on the FCC licenses. DWSI has
operated at a loss since inception and has reported operating losses every
month since the Chapter 11 case was filed.
We have agreed to purchase the assets of DWSI, as part of the plan of
reorganization to be confirmed by the Bankruptcy Court, for 8 million shares
of our common stock, plus 8 million One-Year Warrants, 8 million Eighteen-
Month Warrants, 8 million Two-Year Warrants, and 8 million Three-Year
Warrants. The exercise prices range from $1 to $6. In addition, the
Purchase Agreement provides for a purchase price adjustment of additional
shares of the Company's common stock if certain conditions relative to the
trading of the Company's stock are not met. We also agreed to assume and
pay substantially all of DWSI's indebtedness to others and costs of the DWSI
bankruptcy, including payment of administrative claims, costs to audit
DWSI's financial statements, and closing costs of the proposed purchase.
These claims include professional fees ($87,926), secured creditors
($729,993) and tax claims ($3,133). The professionals and secured creditors
have the option to be paid either in cash or in our securities. The
unsecured claimants ($441,425) and DWSI's current equity interest holders
will receive our securities in satisfaction of their claims.
The issuance of our shares pursuant to the Plan of Reorganization will be
exempt from registration under the Securities Act of 1933, pursuant to
Section 1145 of the U.S. Bankruptcy Code. As such, unsecured claimants who
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receive our stock issued in the acquisition will be able to immediately sell
their shares in the public market. DWSI equity holders will also receive
stock which is exempt from registration under the Securities Act pursuant to
Section 1145 of the Bankruptcy Code, but the proposed plan will have transfer
restrictions. The DWSI equity holder claimants will be unable to transfer
their shares of our stock for three months after the plan's effective date,
and thereafter the equity holder claimants may sell or transfer up to 5% of
their shares each month until all of the stock that they own is
transferrable. The ability to sell a large number of shares in the public
market, if and when such a market for our stock ever begins, may cause the
market price of our shares to drop.
We currently have only about 5million shares of stock issued and outstanding,
plus outstanding warrants to purchase another 2.7 million shares. If we
complete the DWSI acquisition, the claimants and interest holders under the
DWSI bankruptcy will own 8 million shares of our stock and have the right to
purchase an additional 32 million shares. Thus, the DWSI group of recipients
of the shares (which will be distributed to DWSI interest holders in the Plan
of Reorganization) will own a majority of the shares of our outstanding stock
and be able to control future shareholder votes, including election of all
directors. As part of the acquisition, we have agreed to hire David D.
Schlueter, DWSI's chief executive, as our chief executive officer and to
elect him to our board of directors.
The DWSI acquisition agreement is subject to conditions which must be
satisfied prior to completing the purchase. First, our common stock must
begin trading in a securities marketplace, such as Nasdaq or the OTC Bulletin
Board. As stated in 'Risk Factors' we cannot be sure that our stock will
ever be publicly traded. Second, DWSI must provide us with audited financial
statements for the past two years. DWSI has not been audited for the past
two fiscal years, and we cannot be sure that they will be able to provide
satisfactory financial statements. Third, the acquisition must be approved
by the U.S. Bankruptcy Court for the Middle District of Tennessee, where
DWSI's chapter 11 case is filed. DWSI's proposed Disclosure Statement
describing Plan of Reorganization has been distributed to creditors and
interest holders for a vote whether to approve it. The Bankruptcy Court has
scheduled a hearing on whether to confirm the Plan for May 23, 2000. If the
Court confirms the Plan of Reorganization, the Plan could be ready for
completion as early as 30 days after the May 24, 2000, confirmation hearing.
Skycable TV of Madison, LLC
On January 14, 2000, we entered a letter of intent to acquire the assets of
Skycable TV of Madison, LLC, for 4 million shares of our common stock, plus 4
million One-Year Warrants, 4 million Eighteen-Month Warrants, 4 million Two-
Year Warrants, and 4 million Three-Year Warrants. The exercise prices range
from $1 to $6. Skycable provides DBS TV services and operates a wireless
cable service in Madison, Wisconsin, serving 5,600 wireless cable and DBS TV
subscribers. It does not provide wireless Internet services but may do so in
the future. Skycable was created in the same way as we (and DWSI) were
created, and in January 2000, it had approximately 1,600 equity holders.
The Skycable letter of intent contains several contingencies to completing
the transaction, including the development of a public market for our stock,
completion of due diligence reviews by both Skycable and ourselves, election
of David D. Schlueter to our board of directors, approval of the transaction
by Skycable's equity holders, and most significantly, registration of our
shares and warrants to be issued in the transaction under the Securities Act
of 1933. We have not begun work on a registration statement for the
transaction, and we do not have any assurance that we can complete this
acquisition in the foreseeable future. We need to hold a shareholders'
meeting and increase the number of authorized common shares in order to have
enough shares authorized to complete both the DWSI and Skycable transactions.
Like the proposed DWSI acquisition, the Skycable acquisition could result in
a change of control of our Company. We have proposed to issue 4 million
shares plus warrants to purchase another 16 million shares in the Skycable
acquisition, and the warrants, if exercised, would result in the Skycable
interest holders owning a larger number of shares than our current
shareholders hold now, and a majority of shares of our Company if the DWSI
transaction did not occur.
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Bug Motors, Inc., Daybreak Auto Recovery, Inc., and Trailer Nation, Inc.
On January 15, 2000, we signed letters of intent to acquire three unrelated,
privately held companies with automotive manufacturing, sales and service
businesses for shares of our common stock and warrants. The terms of each of
the letters of intent are basically the same. We have agreed to issue
2,698,000 shares of our common stock, plus 1,530,000 million One-Year
Warrants, 3,060,000 Eighteen-Month Warrants, 4,590,000 Two-Year Warrants,
and 5,100,000 Three-Year Warrants. The exercise prices range from $1 to $6.
Each of these three companies are closely held by one or a few owners, and
the stock and warrants we propose to exchange would be sold in exempt
transactions under Section 4(2) of the Securities Act of 1933 and would be
restricted securities.
Each of the three automotive company letters of intent requires that one or
more of the current officers of each respective automotive company be elected
or appointed to the board of directors of our Company. Each party to each
letter may terminate the proposed acquisition if a definitive asset purchase
agreement has not been signed on or before April 30, 2000, or if the
terminating party finds that the results of their due diligence acquisition
of the other party are unsatisfactory. In order to complete each acquisition
and meet our reporting requirements under the Securities Exchange Act of
1934, the automotive company to be acquired must supply audited financial
statements for its last two fiscal years. Again, we need to hold a
shareholders' meeting to increase the number of authorized common shares
prior to completing these acquisitions. We cannot be sure that we will
successfully negotiate definitive acquisition agreements for these companies
or that they will be able to provide the financial statements to us that will
be necessary to report the acquisitions as required by the Exchange Act.
A brief description of the automotive companies follows.
Bug Motors, Inc. will import disassembled Volkswagon 'beetle' autos from
Mexico, where they are manufactured, and remanufactures them in the United
States under a licensing agreement with their Mexican manufacturer. The
remanufactured beetles are recreations of the old Volkswagon beetles which
VW discontinued selling in the U.S. in 1973. Bug Motors has not yet begun
its importing and manufacturing operations.
Daybreak Auto Recovery, Inc. operates an auto repossession business in
Northern California. In addition to recovering autos pledged to secure
defaulted loans, the company will also offer to sell the repossessed autos
for the lender or, in certain circumstances, to purchase the repossessed
auto itself. This service saves the lender the expense and risk of
selling the cars at auction or through another third party.
Trailer Nation, Inc. sells trucks and truck trailers, owns services centers
and manufactures trucking equipment in Florida and Texas.
Because we have yet to complete the negotiation of definitive purchase
agreements or complete our due diligence review of these proposed
acquisitions, we are unable to predict the effect that one or more of the
proposed acquisitions would have on our balance sheet or financial
performance. We cannot be sure that we will be able to complete these
acquisitions at all on terms satisfactory to our Company or the automotive
companies. Any one of the acquisitions, if made, would greatly increase the
number of outstanding shares and warrants to purchase shares of our Company
and likely would result in a change of control of our Company.
Risks: Change of Control of Our Company
If we acquire (1) DWSI, (2) Skycable of Madison, or (3) the three automotive
companies, we will issue more shares than we have outstanding, and voting
control will change. The new shareholders we would gain in any of these three
acquisitions (counting all three auto companies as a single acquisition
opportunity) would hold a majority of the outstanding common stock of the
combined entity. Our existing shareholders would no longer have the right to
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control elections for board of directors or other matters. Our existing
shareholders do not constitute one 'group' of holders for the purpose of
acting jointly or concert to control the corporation, and our management
believes that most of the existing shareholders generally favor our strategy
of acquiring new businesses. Nevertheless, the new shareholders may take the
company in a direction that existing shareholders don't agree with, and after
any one or all of the acquisitions, our existing shareholders would not have
enough votes to control our Company and its directors, even if they attempted
as a group to do so.
* * *
At this stage of negotiations to acquire the companies on which we have
signed letters of intent, we do not have enough information to know what
effect each acquisition will have on our assets, liabilities and operations.
We have not completed our due diligence on the companies. Each of the
letters of intent requires the company to be acquired to provide audited
financial statements prior to the acquisition, but none of the companies
have provided audited statements to date. We are not in a position to state
whether each acquisition will increase our asset value per share, or whether
the value being received in the acquisition would decrease our asset value
per share. We do not have enough information to know that any of these
companies is currently operating at a profit or will be profitable in the
future. Both we and the acquisition candidates have the opportunity to
terminate the proposed combinations if due diligence results are
unsatisfactory or if we are unable to negotiate definitive acquisition
agreements on mutually acceptable terms.
We do believe that at least the DWSI acquisition will take place in the
foreseeable future, though certain items such as completion of financial
statements for DWSI remain and could pose a barrier to completing the
acquisition. We also have considered other acquisitions. Therefore, we
believe it is important to approve the proposal to increase the number of
authorized shares.
Possible Use of Additional Shares in Anti-Takeover Measures.
In addition, the directors could also approve the issuance of shares to
existing shareholders or to new shareholders as a defensive action in the
event of an attempt by someone else to take over the company in a hostile
takeover bid. If the directors do issue shares to prevent a third party from
acquiring control of our company, our shareholders may not be able to realize
the fair market value of their shares in a sale or exchange of shares.
We are not aware of any outstanding or threatened or unsolicited take-over
attempt, but we have discussed with other enterprises, possible mergers or
exchange offers which would transfer control of our company. All of these
discussions have been conducted in a cooperative atmosphere, and we are
unaware of any planned hostile take-over attempt. We have no plans to adopt
hostile take-over measures in addition to the authorization of new shares,
and we have not adopted any other provisions in our articles of
incorporation, bylaws, or any other agreements that we think would deter
take-over offers. In fact, if all of the acquisitions described in the
previous section occur, our existing shareholders will lose voting control of
our Company, as described the preceding subsection, Risks - Change of Control
of Our Company.
The affirmative vote of holders of a majority of our outstanding common
shares is required to approve this proposed amendment.
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The board of directors recommends a vote FOR the proposal to amend the
Articles of Incorporation of the Company to increase the number of authorized
shares from 50 million to 150 million. Proxies solicited by the board of
directors will be so voted unless shareholders specify otherwise in their
proxies. The proposed amendment to Article IV is attached to this Proxy
Statement in Exhibit A.
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Proposal 2: ELIMINATING PREEMPTIVE RIGHTS
The Board also believes it is necessary to eliminate preemptive rights of
shareholders in order to facilitate acquisitions of other companies.
Eliminating preemptive rights would allow the Company to sell and issue
shares without being required to offer additional shares to all current
shareholders.
Alabama law provides that all corporate shareholders automatically have
preemptive rights to acquire shares when corporations offer shares to third
parties, unless each corporation specifically adopts a provision eliminating
preemptive rights. When our company was formed in late 1998, the directors
did not consider whether preemptive rights would be appropriate for us.
Preemptive rights generally work to protect existing shareholders by ensuring
that the board of directors cannot dilute the existing shareholders' equity
ownership by issuing blocks of shares to new investors, or even to
themselves, thereby reducing the existing shareholders' percentage ownership
of the corporation's stock. Preemptive rights require that, before a new
block of stock is issued to third parties, the existing shareholders must be
offered the right to acquire enough shares to at least maintain their pro
rata ownership interest. Thus, it can be used as a tool to protect smaller
shareholders or shareholders that do not hold management positions.
In Alabama, as in most other states, preemptive rights do not apply to some
kinds of transactions, such as sales of stock for other than cash. Thus,
preemptive rights do not prohibit us from issuing shares in exchange offers
for the securities of other companies or in mergers with other companies.
Preemptive rights also do not apply to issuance of shares to employees,
officers and directors as compensation for services.
In a widely held corporation, preemptive rights can be unwieldy. At present,
with preemptive rights in place, the directors could not sell shares to third
parties. It is difficult and time consuming for a widely held company such
as ours to offer preemptive rights to all of its shareholders each time the
Company needs to sell additional shares. Elimination of the preemptive
rights will give our Board of Directors more flexibility in structuring and
finalizing financing and acquisition transactions.
The affirmative vote of holders of a majority of our outstanding common
shares is required to approve this proposed amendment.
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The board of directors recommends a vote FOR the proposal to eliminate
preemptive rights of shareholders. Proxies solicited by the board of
directors will be so voted unless shareholders specify otherwise in their
proxies. The proposed amendment to Article VIII is attached to this Proxy
Statement in Exhibit A.
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C) OTHER INFORMATION
1) Security Ownership of Certain Beneficial Owners and Management.
The following table contains information about the ownership our common
stock, as of December 31, 1999, by our directors or executive officers. This
information was given to us by the stockholders, and the numbers are based on
definitions found in Rules 13d-3 and 13d-5 under the Securities Exchange Act
of 1934. On December 31, 1999, 4,941,146 shares of our common stock were
outstanding. No stockholder beneficially owned more than 5% of our common
stock.
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Shares Owned (1)
Shareholder Number Percent
- ----------- ------ -------
Monte Julius 152,584 3.01%
Demetrios Tsoutsas (2) 102,600 2.04%
Oscar Hayes 102,600 2.04%
Miles Wm. Humphrey, Jr. 116,400 2.31%
Terry L. Hopkins 73,334 1.47%
All directors and officers
as a group (5 persons) 547,518 10.13%
(1) Includes shares which the listed director has the right to acquire
within 60 days after December 31, 1999, from options or warrants. Each
director received the options listed below as compensation for their
service as director in 1998. Each of them also received the warrants
listed below in exchange for their claims against Mobile LLC as part of
the plan of reorganization. The options and warrants are all currently
exerciseable.
Options Warrants Total
------- -------- -------
Monte Julius 115,600 18,492 134,092
Demetrios Tsoutsas 75,000 13,800 88,800
Oscar Hayes 75,000 13,800 88,800
Miles Wm. Humphrey, Jr. 75,000 20,700 95,700
Terry L. Hopkins 50,000 8,162 58,162
All officers and directors
as a group 390,600 74,954 465,554
Under SEC rules, we calculate the percentage ownership of each person
who owns exercisable options by adding (1) the number of exercisable
options for that person to (2) the number of total shares outstanding,
and dividing that result into (3) the total number of shares and
exercisable options owned by that person.
(2) Includes shares owned by Mr. Tsoutsas' spouse.
2) Method and Cost of Soliciting Proxies
The accompanying proxy is being solicited on behalf of the Board of Directors
of the Company. The expense of preparing, printing and mailing the form of
proxy and the material used in the solicitation thereof will be borne by the
Company. Proxies may be solicited by officers, directors, and employees of
the Company in person, or by mail, courier, telephone or facsimile.
3) Other Matters
Management does not know of any matter to be acted upon at the meeting other
than the matters above described. However, if any other matter should
properly come before the meeting, the proxy holders named in the enclosed
proxy will vote the shares for which they hold proxies in their discretion.
Your vote at the special meeting is important to us. Please vote your shares
of common stock by completing the enclosed proxy card and returning it to us
in the enclosed envelope.
By Order of the Board of Directors,
Date: May 8, 2000 Monte Julius, President
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ADVANCED WIRELESS SYSTEMS, INC.
Shareholders' Proxy For Special Meeting, June 7, 2000
Please sign this Proxy below and return to
our Mobile office: Advanced Wireless Systems, Inc.
4123 Government Blvd.
Mobile, Alabama 36693
Solicited by the Board of Directors
The undersigned hereby appoints Monte Julius, or such other persons as the
board of directors of Advanced Wireless Systems, Inc. (the "Company"), may
designate, proxies for the undersigned, with full power of substitution, to
represent the undersigned and to vote all of the shares of Common Stock of
the Company, which the undersigned is entitled to vote at the special meeting
of shareholders of the Company to be held on June 7, 2000, and at any and all
adjournments thereof.
1. Amendment to Article IV of the Articles of Incorporation - The board
of directors recommends a vote FOR the following.
To amend the Company's Articles of Incorporation in order to increase
the number of authorized shares from 50,000,000 to 150,000,000.
( ) For ( ) Against ( ) Abstain
2. Amendment to Article VIII of the Articles of Incorporation - The
board of directors recommends a vote FOR the following.
To amend the Company's Articles of Incorporation in order to eliminate
preemptive rights of shareholders.
( ) For ( ) Against ( ) Abstain
3. Other Matters - The board of directors recommends a vote FOR the
following.
In their discretion, to vote on such other matters as may properly come
before the meeting, but which are not now anticipated and to vote upon
matters incident to the conduct of the meeting.
( ) For ( ) Against ( ) Abstain
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS AND WILL BE VOTED
AS DIRECTED HEREIN. IF NO DIRECTION IS GIVEN, THIS PROXY WILL BE VOTED FOR
PROPOSALS 1 AND 2, AND IN ACCORDANCE WITH THE DISCRETION OF THE PROXY HOLDERS
RESPECTING PROPOSAL 3.
- ---------------------------------- ---------------------------------------
(Signature of Stockholder) (Signature of Second Stockholder, If Any)
- ---------------------------------- ---------------------------------------
Please Print Name Please Print Name
Number of Share You Own: Date:
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EXHIBIT 'A' to Proxy Statement
ARTICLES OF AMENDMENT
TO THE ARTICLES OF INCORPORATION OF
ADVANCED WIRELESS SYSTEMS, INC.
Pursuant to the provisions of Section 10-2B-10.06 of the Code of
Alabama, the undersigned corporation adopts the following Articles of
Amendment to its Articles of Incorporation:
Article One
The name of the corporation is Advanced Wireless Systems, Inc.
Article Two
The following amendment to the Articles of Incorporation was approved
and adopted by the shareholders of the corporation. The amendment changes
Article IV of the original Articles of Incorporation and the full text of
Article IV as altered is as follows:
'Article IV
The number of shares which the corporation shall have authority to issue
is 150,000,000.'
Article Three
The following amendment to the Articles of Incorporation was approved
and adopted by the shareholders of the corporation. The amendment adds
Article VIII to the original Articles of Incorporation and the full text of
Article VIII as added is as follows:
'Article VIII
The shareholders of the corporation shall not be entitled to any
preemptive rights with respect to the shares of the corporation, and any
preemptive rights that might otherwise exist for the corporation's
shareholders under the laws of the State of Alabama are hereby waived
and eliminated.'
Article Four
The corporation has only one class or voting group of shares
outstanding, and the number of such shares of the corporation outstanding at
the time these amendments were adopted was . All such outstanding
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shares were entitled to vote on these amendments. These amendments were
adopted by the shareholders at a special meeting held on June 7, 2000, and the
number of such shares represented at that meeting was . The
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number of shares voted in favor of these amendments at such meeting was
, and the number of shares voted against these amendments
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at that meeting was . The number of shares voted for these
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amendments was sufficient for approval of these amendments by the shareholders
of the corporation.
Date: Advanced Wireless Systems, Inc.
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By:
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Monte Julius, President
