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:
[ ] 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 Section 240.14a-11(c) or
Section 240.14a-12
ASPI EUROPE, 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:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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ASPI EUROPE, INC.
Two Union Square, Suite 4200
601 Union Street
Seattle, Washington 98101
Telephone: (206) 652-3675 Facsimile: (206) 652-3676
September 5, 2000
DEAR SHAREHOLDER:
You are cordially invited to attend the Annual Meeting of Shareholders
("Annual Meeting") of ASPi Europe, Inc. (the "Company") to be held at 11:00 A.M.
local time on Tuesday, September 26, 2000 at the principal offices of the
Company at Two Union Square, Suite 4200, 601 Union Street, Seattle, Washington
98101.
The items of business to be considered at the Annual Meeting include:
1. to approve the redomicile of the Company's place of incorporation from
Florida to Delaware;
2. to elect all three (3) directors to the Board of Directors (the
"Board"); and
3. to ratify the selection of BDO Seidman, LLP as independent auditors
for the Company for fiscal year 2000.
More information concerning the business to be conducted at the Annual Meeting
is included in the accompanying Notice of Annual Meeting of Shareholders and
Proxy Statement. The Board unanimously recommends that shareholders vote "FOR"
all three (3) of these proposals.
YOUR VOTE IS VERY IMPORTANT. Whether or not you plan to attend the Annual
Meeting, it is important that your shares be represented. Therefore, we urge you
to sign, date and promptly return the enclosed proxy in the enclosed envelope.
If you attend the Annual Meeting, you will, of course, have the right to vote in
person.
I look forward to greeting you personally and, on behalf of the Board and
management, I would like to express our appreciation for your interest in the
Company.
Sincerely,
/s/ Damon Poole
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Damon Poole, Chief Executive Officer
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ASPI EUROPE, INC.
Two Union Square, Suite 4200
601 Union Street
Seattle, Washington 98101
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NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON TUESDAY, SEPTEMBER 26, 2000
The Annual Meeting of Shareholders (the "Annual Meeting") of ASPi Europe,
Inc. (the "Company") will be held at 11:00 A.M. local time on Tuesday, September
26, 2000, at the principal offices of the Company at Two Union Square, Suite
4200, 601 Union Street, Seattle, Washington 98101, for the following purposes:
1. to approve the redomicile of the Company's place of incorporation from
Florida to Delaware;
2. to elect all three (3) directors to the Board of Directors (the
"Board");
3. to ratify the selection of BDO Seidman, LLP as independent auditors
for the Company for fiscal year 2000; and
4. to transact such other business as may properly come before the
meeting or any adjournment or postponement thereof.
Only shareholders of record at the close of business on Monday, September
4, 2000 are entitled to notice of, and to vote at, the Annual Meeting.
Shareholders unable to attend the Annual Meeting in person who wish to have
their shares represented at the Annual Meeting are required to read the enclosed
Proxy Statement and then complete and deposit the accompanying Proxy together
with the power of attorney or other authority, if any, under which it was
signed, or a notarized certified copy thereof, with the Company prior to the
commencement of the Annual Meeting. Shareholders who received the Proxy through
an intermediary must delivery the Proxy in accordance with the instructions
given by such intermediary.
Shareholders of the Company who do not vote in favor of approving the
redomicile of the Company's place of incorporation from Florida to Delaware will
have the right to dissent and seek appraisal of the fair value of their shares
if they comply with the procedures required by Florida law, which are attached
as Annex A.
By Order of the Board of Directors
/s/ Damon Poole
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Damon Poole, Chief Executive Officer
September 5, 2000
THE PROXY STATEMENT WHICH ACCOMPANIES THIS NOTICE OF ANNUAL MEETING OF
SHAREHOLDERS CONTAINS MATERIAL INFORMATION CONCERNING THE MATTERS TO BE
CONSIDERED AT THE ANNUAL MEETING, AND SHOULD BE READ IN CONJUNCTION WITH THIS
NOTICE.
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ASPI EUROPE, INC.
Two Union Square, Suite 4200
601 Union Street
Seattle, Washington 98101
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PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
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INTRODUCTION
This Proxy Statement is being furnished to shareholders in connection with
the solicitation of proxies by the Board of Directors (the "Board") of ASPi
Europe, Inc. (the "Company") for use at the Annual Meeting of Shareholders of
the Company (the "Annual Meeting") to be held at 11:00 A.M. local time on
Tuesday, September 26, 2000, at the principal offices of the Company at Two
Union Square, Suite 4200, 601 Union Street, Seattle, Washington 98101, and at
any adjournments thereof, for the purpose of considering and voting upon the
matters set forth in the accompanying Notice of Annual Meeting of Shareholders.
This Proxy Statement and the accompanying form of proxy are first being mailed
to shareholders on or about September 5, 2000.
The close of business on Monday, September 4, 2000, has been fixed as the
record date for the determination of shareholders entitled to notice of, and to
vote at, the Annual Meeting and any adjournment or postponement thereof. As of
the record date, there were 7,063,116 shares of the Company's common stock, with
a par value of $0.001 per share (the "Common Stock"), issued and outstanding and
entitled to vote at the Annual Meeting. There are no other classes of voting
stock of the Company issued and outstanding.
The presence, in person or by proxy, of the holders of one-third (1/3) of
the outstanding shares of the Common Stock entitled to vote on the record date
is necessary to constitute a quorum at the Annual Meeting. Abstentions and
broker non-votes will be counted towards a quorum. If a quorum is not present or
represented at the Annual Meeting, the shareholders present at the Annual
Meeting or represented by proxy have the power to adjourn the Annual Meeting
from time to time, without notice other than an announcement at the Annual
Meeting, until a quorum is present or represented. At any such adjournment of
the Annual Meeting at which a quorum is present or represented, any business may
be transacted that might have been transacted at the original Annual Meeting.
The affirmative vote of at least 50.01% of the shares of Common Stock
outstanding is required for approval of (i) the redomicile of the Company's
place of incorporation from Florida to Delaware, (ii) the election of all three
(3) directors to the Board of Directors, and (iii) the ratification of the
selection of BDO Seidman, LLP as independent auditors for the Company for fiscal
year 2000.
Abstentions will have the same effect as a vote against the proposal and
broker non-votes will be disregarded.
All shares represented by properly executed proxies, unless such proxies
previously have been revoked, will be voted at the Annual Meeting in accordance
with the directions on the proxies. IF NO DIRECTION IS INDICATED, THE SHARES
WILL BE VOTED TO APPROVE (I) the redomicile of the Company's place of
incorporation from Florida to Delaware, (II) the election of all three (3)
directors to the Board of Directors, and (III) the ratification of the selection
of BDO Seidman, LLP as Independent auditorS for the company for fiscal year
2000. The enclosed
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Proxy, even though executed and returned, may be revoked at any time prior to
the voting of the Proxy by one of the following methods: (a) execution and
submission of a revised Proxy, (b) written notice to Patrick McGrath, the
Secretary of the Company, or (c) voting in person at the Annual Meeting.
PROPOSAL 1
THE REDOMICILE OF THE COMPANY'S PLACE OF INCORPORATION FROM FLORIDA
TO DELAWARE
The Board of Directors believes that it is in the best interest of the
Company to redomicile its place of incorporation from Florida to Delaware by
merging with and into Cyber-Centrix Corporation (or such other name for the
corporation as may be determined by the Board prior to shareholder approval of
the Merger), a Delaware corporation ("Cyber-Centrix" or the "Corporation") that
will be formed by the Company as its wholly-owned subsidiary (the "Merger").
Upon completion of the Merger, the owner of each outstanding share of the
Company's Common Stock will automatically own one share of the common stock, par
value 0.001 per share, of Cyber-Centrix. Each outstanding certificate
representing a share or shares of the Company's Common Stock will continue to
represent the same number of shares in Cyber-Centrix. THUS, IT WILL NOT BE
NECESSARY FOR SHAREHOLDERS OF THE COMPANY TO EXCHANGE THEIR EXISTING STOCK
CERTIFICATES FOR STOCK CERTIFICATES OF CYBER-CENTRIX. To accomplish this, the
Company has prepared a Agreement and Plan of Merger, which is attached hereto as
Annex B.
The shareholders of the Company are entitled to dissenters' rights of
appraisal under the Florida Business Corporation Act (the "FBCA"). In the event
that shareholders collectively owning more than one percent (1%) of the shares
of the Company exercise his, her or its dissenters' rights, the Board may
abandon the Plan of Merger with the result that the Company will remain
domiciled in the State of Florida.
Any shareholder who does not wish to approve of the redomicile of the
Company has the right under Florida law to have his, her or its shares appraised
by a court of law to determine their fair value. This right of appraisal is
subject to a number of restrictions and technical requirements. In order to
exercise appraisal rights, among other things: (a) a shareholder must NOT vote
in favor of approving the redomicile of the Company, and (b) a shareholder must
make a written demand for appraisal in compliance with the procedures required
by Florida law BEFORE the vote to approve of the redomicile of the Company.
Merely voting against approving the redomicile of the Company will not
preserve appraisal rights under Florida law. Attached to this Proxy Statement as
Annex A is the Florida statute relating to appraisal rights, and failure to
comply with ALL of the requirements contained in this statute will result in the
loss of these rights.
COMPARATIVE RIGHTS OF SHAREHOLDERS
The following is only a summary of the differences between the rights of a
shareholder under the FBCA and the Delaware General Corporation Law ("DGCL") and
is qualified in its entirety by the FBCA, DGCL, the Articles of Incorporation
(the "Articles") and bylaws of the Company and the Certificate of Incorporation
(the "Certificate") and bylaws of Cyber-Centrix, which may be modified by the
Board prior to adoption at the Annual Meeting. Copies of the Company's Articles
and bylaws and Cyber-Centrix's Certificate and bylaws are incorporated by
reference herein and will be sent to holders of the Company's Common Stock upon
request.
Under the Plan of Merger, the Company's shareholders whose rights are
currently governed by Florida law will, upon the exchange of their shares
pursuant to the Merger, become holders of shares in
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Cyber-Centrix, and their rights as such will be governed by Delaware law, under
Cyber-Centrix's Certificate and bylaws. The material differences between the
rights of holders of the shares in the Company and shares in Cyber-Centrix,
which result from differences in their governing corporate documents and
differences in Delaware and Florida corporate law, are summarized below.
Appraisal Rights Of Dissenting Shareholders
The FBCA provides that any shareholder of a corporation generally has the
right to dissent from, and obtain payment of the fair value of their shares in
the event of a merger, share exchange, a sale or exchange of all or
substantially all the property of the corporation other than in the ordinary
course of its business, or any amendment to the Corporation's articles of
incorporation that adversely affects such shareholder, provided such shareholder
otherwise complies with the requirements of Florida law and does not vote in
favor of the proposed action.
Unless the articles of incorporation otherwise provide (which the Company's
do not), a shareholder does not have dissenters' rights with respect to a plan
of merger or share exchange or a proposed sale or exchange of property where
shares of the Company's stock are either (i) registered on a national securities
exchange or designated as a national market system security on an interdealer
quotation system by National Association of Securities Dealers, Inc. (the
"NASD") or (ii) held of record by not fewer that 2,000 shareholders.
As the Company does not qualify for such an exception, the Company's
shareholders will be entitled to dissenters' rights pursuant to the Merger.
Under Delaware law, a stockholder of a Delaware corporation is generally
entitled to demand appraisal and obtain payment of the judicially-determined
fair value of his or her shares in the event of any plan of merger or
consolidation to which the corporation, is a party, provided such stockholder
continuously holds such shares through the effective date of the merger and
otherwise complies with the requirements of Delaware law for the perfection of
appraisal rights and does not vote in favor of the merger.
Such appraisal rights are not available, however, when shares of the
Corporation's stock are either (i) listed on a national securities exchange or
designated as a national market system security on an interdealer quotation
system by the NASD or (ii) held of record by more than 2,000 holders. In
addition, appraisal rights are not available for any shares of stock of the
constituent corporation surviving the merger if the merger did not require for
its approval the vote of the stockholders of the surviving corporation.
Notwithstanding the above, appraisal rights are available for the shares of any
class or series of stock of a Delaware corporation if the holders thereof are
required by the terms of an agreement of merger or consolidation to accept for
their stock anything except: (i) shares of stock of the corporation surviving or
resulting from the merger or consolidation; (ii) shares of stock of any other
corporation, or depository receipts in respect thereof, which at the effective
date of the merger or consolidation will be listed on a national securities
exchange or designated as a national market system security on an interdealer
quotation system by the NASD or held of record by more than 2,000 stockholders;
(iii) cash in lieu of fractional shares of the corporations described in (i) and
(ii); or (iv) any combination of the shares of stock, depository receipts and
cash in lieu of fractional shares described in (i), (ii) and (iii).
Cyber-Centrix's Certificate does not contain any provision relating to
stockholder appraisal rights. As Cyber-Centrix does not qualify for an exception
to appraisal rights, its stockholders are generally entitled to appraisal rights
under the DGCL.
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Authorized Capital
The Company's Articles provide for authorized stock consisting of
50,000,000 shares of common stock, $0.001 par value.
Cyber-Centrix's Certificate provides for authorized stock consisting of
50,000,000 shares of common stock, $0.001 par value, and 50,000,000 shares of
preferred stock, $0.001 par value. Cyber-Centrix's preferred stock is "blank
check" preferred stock in that it may be issued from time to time in one (1) or
more series with such rights and preferences as adopted by resolution or
resolutions of the board of directors of the Corporation.
Election And Size Of Board Of Directors
The FBCA requires that a board of directors consist of one or more natural
persons, with the number specified in or in accordance with the corporation's
articles of incorporation or bylaws, that are elected at each annual shareholder
meeting, unless their terms are staggered. The number of directors may be
increased or decreased from time to time by amendment to, or in the manner
provided in, the articles of incorporation or the bylaws. If authorized in the
articles of incorporation, the FBCA permits staggered boards of directors of up
to three (3) separate classes. Under Florida law, shareholders do not have
cumulative voting unless the articles of incorporation so provide.
The Company's Articles state that it will have not less than one (1)
director, subject to such minimum that may be increased or decreased from time
to time in the manner provided in the bylaws. The Company's bylaws provide that
the number of directors will be fixed from time to time, within the limits
specified in the Articles, by resolution of the Board. In addition, directors
will be elected in the manner and hold office for the terms as prescribed in the
Articles. Directors must also be natural persons who are 18 years of age or
older, but need not be residents of the State of Florida, shareholders of the
Company or citizens of the United States.
Under Delaware law, directors, unless their terms are staggered in the form
of a classified board of directors, are elected at each annual stockholder
meeting. The certificate of incorporation may authorize the election of certain
directors by one (1) or more classes or series of shares, and the certificate of
incorporation, an initial bylaw or a bylaw adopted by a vote of the stockholders
may provide for staggered terms for the directors. The certificate of
incorporation or the bylaws also may allow the stockholders or the board of
directors to fix or change the number of directors, but a corporation must have
at least one (1) director. Under Delaware law, stockholders do not have
cumulative voting rights unless the certificate of incorporation so provides.
Cyber-Centrix's Certificate provides that the board of directors will be
comprised of three (3) initial directors. The initial directors will serve until
the first annual meeting of the stockholders and until their successors are
elected and qualified. Cyber-Centrix's bylaws provide that the board of
directors will consist initially of three (3) directors, who need not be
stockholders, and, thereafter, will consist of such number as may be fixed from
time to time by resolution of the board of directors. The directors will also be
elected at the annual meeting of the stockholders and will hold office until
their successors are elected and qualified or until their earlier resignation or
removal.
Removal Of Directors
The FBCA entitles shareholders to remove directors either for cause or
without cause, unless the articles of incorporation provide that removal may be
for cause only. Directors elected by a particular voting group may only be
removed by the shareholders of that voting group. The Company's Articles do
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not contain any statements relating to the removal of directors either for cause
or without cause. The Company's bylaws state that directors may be removed only
in the manner prescribed in the Company's Articles.
Under the DGCL, a director of a corporation that does not have a classified
board of directors or cumulative voting may be removed with or without cause
with the approval of a majority of the outstanding shares entitled to vote.
Whenever the holders of a class or series of stock are entitled to elect one (1)
or more directors by the certificate of incorporation, however, a vote of the
holders of outstanding shares of that class or series of stock will be entitled
to remove the director or directors so elected and not a vote of all outstanding
shares as a whole. Cyber-Centrix's bylaws provide that any director may be
removed, with or without cause, by the holders of a majority of the shares of
capital stock entitled to vote at an election of directors, either by written
consent or at any special meeting of the stockholders called for that purpose,
and the office of such director will become vacant.
Vacancies On The Board Of Directors
The FBCA provides that, unless the articles provide otherwise, vacancies
arising on the board of directors may be filled by a majority of the remaining
directors, even if no quorum remains, or by the shareholders. When directors are
divided into classes, vacancies may be filled by the shareholders or, if at
least one (1) director remains in the class, by the remaining directors of that
class. Where a vacancy will be known to occur at some point in the future, it
may be filled in advance, although the new director will not take office until
the vacancy actually occurs. The Company's Articles and bylaws do not contain
any additions to these statutory provisions.
Under Delaware law, a majority of the directors of a corporation then in
office, although less than a quorum, may fill any vacancy on the board of
directors, including vacancies resulting from an increase in the number of
directors. Cyber-Centrix's bylaws also provide that vacancies on the board will
be filled by a majority of the directors then in office though less than a
quorum. The stockholders removing any director, however, may at the time fill
any such vacancy caused by such removal. Furthermore, if the directors fail to
fill any vacancy, the stockholders may at any special meeting called for that
purpose fill such vacancy. Any person elected to fill a vacancy will hold
office, subject to the right of removal as provided for in the bylaws, until his
or her successor is elected and qualified.
Action By Written Consent
The FBCA allows shareholders or all of the directors to take action without
a meeting through the use of a written consent, unless provided otherwise in the
articles of incorporation. The FBCA provides that actions of shareholders
required or permitted to be at an annual or special meeting of shareholders may
be taken without a meeting, without prior notice, if a consent or consents in
writing, setting forth the action so taken, is dated and signed by the holders
of outstanding stock having not less than the minimum number of votes that would
be necessary to authorize or take such action at a meeting at which all voting
groups and shares entitled to vote thereon were present and voted with respect
to the subject matter thereof and such consent is delivered to the Company
within 60 days of the earliest dated consent. Within ten (10) days after
obtaining such authorization by written consent, notice must be given to those
shareholders who have not consented in writing or who are not entitled to vote
on the action. The FBCA also allows that any action required or permitted to be
taken at a meeting of the board of directors or committee thereof to be taken
without a meeting if a consent in writing, setting forth the action taken, is
signed by all the members of the board of directors or the committee. The
Company's Articles or bylaws do not contain any additions to these statutory
provisions.
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Delaware law provides that, unless limited by the certificate of
incorporation, any action that could be taken by stockholders at any annual or
special meeting of such stockholders may be taken without a meeting if a consent
or consents in writing, setting forth the action so taken, is signed by the
holders of outstanding stock having not less than the minimum number of votes
that would be necessary to authorize or take such action at a meeting at which
all shares entitled to vote thereon were present and voted and delivered to the
corporation. Prompt notice of an action taken by written consent which is not
unanimous is required to be given to those stockholders who have not consented
in writing. Delaware law also provides that any action required or permitted to
be taken at any meeting of the board of directors, or at any committee thereof,
may be taken without a meeting if all the members of the board of directors or
committee, as the case may be, consent thereto, in writing, and the writing or
writings are filed with the minutes of the proceedings of the board of directors
or committee. Cyber-Centrix's Certificate and bylaws do not contain any
additions to these statutory provisions.
Amendments To Charter
Under Florida law, amendments to the corporate charter require the approval
of a majority of the shareholders entitled to vote thereon. The Company's
Articles do not contain any additions to these statutory provisions.
Under Delaware law, unless a higher vote is required in the certificate of
incorporation, an amendment to the certificate of incorporation of a corporation
may be approved by a majority of the outstanding shares entitled to vote upon
the proposed amendment. Cyber-Centrix's Certificate states that the Corporation
reserves the right to amend, alter, change or repeal any provision contained in
the Certificate, in the manner now or hereafter prescribed by statute, with all
rights conferred upon stockholders in the Certificate granted subject to this
reservation.
Amendments To Bylaws
Under the FBCA, bylaws may be amended by the directors or the shareholders
unless (i) the articles of incorporation expressly provide that only
shareholders may do so, or (ii) the shareholders provide that they may not be
amended or repealed by the directors. The Company's Articles provide that its
bylaws may be adopted, modified, amended or repealed only upon the affirmative
vote of a majority of the holders of all issued and outstanding shares of the
Company entitled to vote thereon. The Company's bylaws provide that the bylaws
may be altered, amended or repealed, and new bylaws adopted at any meetings of
the board of directors at which a quorum is present, by the affirmative vote of
a majority of the directors present at such meeting.
The DGCL provides that a corporation's bylaws may be amended by that
corporation's stockholders, or, if so provided in the corporation's certificate
of incorporation, the power to amend the corporation's bylaws may also be
conferred on the corporation's directors. Cyber-Centrix's Certificate gives its
directors the authority to make, alter or repeal the bylaws of the corporation.
Cyber-Centrix's bylaws provide that the board of directors will have the power
to make, rescind, alter, amend and repeal the bylaws, provided however, that the
stockholders will have the power to rescind, alter, amend or repeal any bylaws
made by the board of directors and to enact bylaws, which if so expressed, will
not be rescinded, altered, amended or repealed by the board of directors.
Quorum for Shareholder Meetings and Shareholder Voting Requirements
Under Florida law, unless otherwise provided in a corporation's certificate
of incorporation, a majority of the votes entitled to be cast on a matter by a
voting group constitutes a quorum of that voting group for action on that
matter. If a quorum exists, action on a matter by a voting group (other than the
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election of directors) is approved if the votes cast within the voting group
favoring the action exceed the votes cast opposing the action, unless the
articles of incorporation or this act requires a greater number of affirmative
votes. The Company's Articles state that the holders entitled to one-third (1/3)
of the votes at a meeting of shareholders will constitute a quorum; however,
acts of shareholders will require the approval of holders of 50.01% of the
outstanding votes of shareholders.
Under Delaware law, unless otherwise provided in a corporation's
certificate of incorporation or its bylaws, a majority of shares entitled to
vote on a matter constitutes a quorum at a meeting of stockholders, but in no
event may a quorum consist of less than one-third (1/3) of the shares entitled
to vote on such matter. In all matters other than the election of directors, the
affirmative vote of the majority of shares present in person or represented by
proxy at the meeting and entitled to vote on the subject matter will be the act
of the stockholder. Cyber-Centrix's bylaws state that any number of
stockholders, together holding at least one-third (1/3) of the capital stock of
the corporation issued and outstanding and entitled to vote, who are present in
person or represented by proxy at any meeting duly called, constitute a quorum
for the transaction of business. At all meetings of stockholders, all matters,
except as otherwise provided by statute, will be determined by the affirmative
vote of the majority of shares present in person or by proxy and entitled to
vote on the subject matter.
Proxies
Under Florida law, a proxy is effective only for a period of eleven (11)
months, unless otherwise provided in the proxy. The Company's Articles and
bylaws do not contain any additions to these statutory provisions.
Under Delaware law, a proxy executed by a stockholder will remain valid for
a period of three (3) years, unless the proxy provides for a longer period.
Cyber-Centrix's Certificate and bylaws do not contain any additions to these
statutory provisions.
Special Meetings Of Shareholders
Under the FBCA, a special meeting of shareholders may be called by a
corporation's board of directors or any other person authorized to do so in the
articles of incorporation or bylaws. Special meetings may also be called on
demand of at least 10% of all shares eligible to vote on the matter to be
considered, although this percentage may be increased in the articles of
incorporation to a maximum of 50%. Only business within the purpose of the
special meeting notice may be conducted at such meeting. The Company's Articles
do not contain any statements relating to special meetings of the shareholders.
The Company's bylaws provide that special meetings may be called in accordance
with the procedures set forth in the Company's Articles for calling special
meetings of shareholders.
Delaware law provides that special meetings of the stockholders of a
corporation may be called by the corporation's board of directors or by such
other persons as may be authorized in the corporation's certificate of
incorporation or bylaws. Cyber-Centrix's bylaws provide that special meetings of
stockholders for any purpose may be called at any time by the board of directors
or by the chief executive officer, and will be called by the chief executive
officer at the request of the holders of a majority of the outstanding shares of
capital stock entitled to vote. Also, at a special meeting, no business will be
transacted and no corporate action will be taken other than that stated in the
notice of the meeting.
Vote On Extraordinary Corporate Transactions
Under the FBCA, and subject to certain exceptions (including those
described in "Business Combination Restrictions"), the approval of a merger or
share exchange, plan of liquidation or sale of all
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or substantially all of a corporation's assets other than in the regular course
of business requires the recommendation of the corporation's board of directors
and an affirmative vote of a majority of the shareholders eligible to vote
thereon. The foregoing provisions apply to the Company. The Company's Articles
and bylaws do not contain any additions to these statutory provisions.
Delaware law provides that, unless otherwise specified in a corporation's
certificate of incorporation or unless the provisions of Delaware law relating
to business combinations discussed below under "Business Combination
Restrictions" are applicable, a sale or other disposition of all or
substantially all of the corporation's assets, a merger or consolidation of the
corporation with another corporation or a dissolution of the corporation
requires the affirmative vote of the board of directors, except in certain
limited circumstances, in addition to, with certain exceptions, the affirmative
vote of a majority of the outstanding stock entitled to vote thereon. The
foregoing provisions apply to Cyber-Centrix. Cyber-Centrix's Certificate does
not contain any additions to these statutory provisions.
Inspection Of Documents
Under the FBCA, a shareholder is entitled to (i) inspect and copy the
articles of incorporation, (ii) bylaws, (iii) certain board and shareholder
resolutions, (iv) certain written communications to shareholders, (v) a list of
the names and business addresses of the corporation's directors and officers,
and (vi) the corporation's most recent annual report during regular business
hours, if the shareholder gives at least five (5) business days prior written
notice to the corporation before the dated he or she wishes to inspect and copy.
In addition, a shareholder of a Florida corporation is entitled to inspect and
copy other books and records of the corporation during regular business hours if
the shareholder gives at least five (5) business days prior written notice to
the corporation and (i) the shareholder's demand is made in good faith and for a
proper purpose, (ii) the demand describes with particularity its purpose and the
records to be inspected or copied and (iii) the requested records are directly
connected with such purpose. The FBCA also provides that a corporation may deny
any demand for inspection if the demand was made for an improper purpose or if
the demanding shareholder (i) has, within two (2) years preceding such demand,
sold or offered for sale any list of shareholders of the corporation or any
other corporation, (ii) has aided or abetted any person in procuring a list of
shareholders for such purpose or (iii) has improperly used any information
secured through any prior examination of the records of the corporation or any
other corporation. Under the Company's Articles, the Board will make reasonable
rules to determine at what times and places and under what conditions the books
of the Company will be open to inspection by shareholders or a duly appointed
representative of a shareholder.
The DGCL allows any stockholder, upon written demand under oath stating the
purpose thereof, the right during the usual hours for business to inspect for
any proper purpose the corporation's (i) stock ledger, (ii) a list of its
stockholders, and (iii) its other books and records, and to make copies or
extracts therefrom. A proper purpose means a purpose reasonably related to such
person's interest as a stockholder. If the corporation refuses to permit
inspection sought by a stockholder or does not reply to the demand within five
(5) business days after the demand has been made, the stockholder may apply to a
court for an order to compel inspection. Cyber-Centrix's Articles or bylaws do
not contain any additions to these statutory provisions.
Dividends
The FBCA permits a corporation's board of directors to make distributions
to its shareholders as long as (i) the corporation is able to pay its debts as
they become due in the ordinary course of business or (ii) its total assets are
greater than the sum of its total liabilities plus the amount that would be
necessary to satisfy the preferred shareholders upon dissolution of shareholders
whose preferential rights are
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superior to those receiving the distribution. Under the FBCA, a corporation's
redemption of its own capital stock is deemed to be a distribution.
The Company's bylaws provide that the Board may from time to time declare,
and the corporation may pay, dividends on its shares in cash, property, stock
(including its own shares), or otherwise pursuant to law and subject to the
provisions of the Articles.
Subject to any restrictions contained in a corporation's certificate of
incorporation, Delaware law generally provides that a corporation may declare
and pay dividends out of "surplus" (defined as the excess, if any, of net assets
(total assets less total liabilities) over capital) or, when no surplus exists,
out of net profits for the fiscal year in which the dividend is declared and/or
the preceding fiscal year, except that dividends may not be paid out of net
profits if the capital of the corporation is less than the amount of capital
represented by the issued and outstanding stock of all classes having a
preference upon the distribution of assets. In accordance with the DGCL,
"capital" is determined by the board of directors and will not be less than the
aggregate par value of the outstanding capital stock of the corporation having
par value.
Cyber-Centrix's Certificate states that subject to any preferential rights
granted for any series of preferred stock, the holders of shares of the common
stock will be entitled to receive dividends, out of the funds of the Corporation
legally available therefor, at the rate and at the time or times, whether
cumulative or noncumulative, as may be provided by the board of directors. The
holders of shares of the preferred stock will be entitled to receive dividends
to the extent provided in the Certificate or by the board of directors in
designating the particular series of preferred stock, and the holders of shares
of the common stock will not be entitled to receive any dividends other than the
dividends referred to in the Certificate. Cyber-Centrix's bylaws state that the
board of directors has the power to fix and vary the amount to be set aside or
reserved as working capital of the Corporation or as reserves and, subject to
the requirements of the Certificate, to determine whether any part of the
surplus or net profits of the Corporation will be declared as dividends and paid
to the stockholders as well as to fix the date or dates for such payment or
dividends.
Indemnification Of Directors And Officers
The FBCA permits a corporation to indemnify any person who was or is a
party to any proceeding, by the reason of the fact that he or she is or was an
officer or director, employee and agent of the corporation or is or was serving
at the request of the corporation as a director, officer, employee or agent of
the corporation or another entity, if he or she acted in good faith and in a
manner he or she reasonably believed to be in, or not opposed to, the best
interests of the corporation, and with respect to any criminal action, which
they had no reasonable cause to believe was unlawful. The FBCA provides that a
corporation may advance reasonable expenses of defense upon receipt of an
undertaking to reimburse the corporation if indemnification is ultimately
determined not to be appropriate. A corporation must reimburse a successful
defendant, however, for expenses, including attorneys' fees, actually and
reasonably incurred in connection with such defense. The FBCA also provides that
indemnification may not be made for any claim, issue or matter as to which a
person has been adjudged by a court of competent jurisdiction to be liable to
the corporation, unless and only to the extent a court determines that the
person is entitled to indemnity for such expenses as the court deems proper. The
Company's Articles provide that it will have the power, in its bylaws or in a
resolution of its shareholders or directors, to undertake to indemnify the
officers and directors of the Company against any contingency or peril as may be
determined to be in the best interest of the Company.
Under Delaware law, a corporation may indemnify any person made a party or
threatened to be made a party to any type of proceeding (other than an action by
or in the right of the corporation) because
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he is or was an officer, director, employee or agent of the corporation or was
serving at the request of the corporation as a director, officer, employee or
agent of another corporation or entity, against expenses, judgments, fines and
amounts paid in settlement actually and reasonably incurred in connection with
such proceeding: (i) if he acted in good faith and in a manner he reasonably
believed to be in or not opposed to the best interests of the corporation and
(ii) in the case of a criminal proceeding, he had no reasonable cause to believe
that his conduct was unlawful. A corporation may indemnify any person made a
party or threatened to be made a party to any threatened, pending or completed
action or suit brought by or in the right of the corporation because he was an
officer, director, employee or agent of the corporation, or is or was serving at
the request of the corporation as a director, officer, employee or agent of
another corporation or other entity, against expenses actually and reasonably
incurred in connection with the defense or settlement of such action or suit if
he acted in good faith and in a manner he reasonably believed to be in or not
opposed to the best interests of the corporation. There may be no such
indemnification, however, if the person is found liable to the corporation
unless, and only to the extent that, the court determines the person is entitled
thereto. A corporation must also indemnify a present or former director or
officer agent against expenses actually and reasonably incurred by him who
successfully defends himself in a proceeding to which he was a party because he
was a director or officer of the corporation. In addition, expenses incurred by
an officer or director (or former director or officer, employee or agent as
deemed appropriate by the board of directors) in defending a proceeding may be
paid by the corporation in advance of the final disposition of such proceeding
upon receipt of an undertaking by or on behalf of such director or officer to
repay such amount if it will ultimately be determined that he is not entitled to
be indemnified by the corporation. The Delaware law indemnification and expense
advancement provisions are not exclusive of any other rights which may be
granted by the bylaws, a vote of stockholders or disinterested directors,
agreement or otherwise. Cyber-Centrix's Certificate and bylaws do not contain
any additions to these statutory provisions.
Limitation Of Liability
The FBCA provides that a director is not personally liable for monetary
damages to the corporation or any other person for any statement, vote,
decision, or failure to act, regarding corporate management or policy unless the
director breached or failed to perform his statutory duties as a director and
such breach or failure (i) constitutes a violation of criminal law, unless the
director had reasonable cause to believe his conduct was lawful or had no
reasonable cause to believe his conduct was unlawful, (ii) constitutes a
transaction from which the director derived an improper personal benefit, (iii)
results in an unlawful distribution, (iv) in a derivative action or an action by
a shareholder, constitutes conscious disregard for the best interests of the
corporation or willful misconduct or (v) in a proceeding other than a derivative
action or an action by a shareholder, constitutes recklessness or an act or
omission which was committed in bad faith or with malicious purpose or in a
manner exhibiting wanton and willful disregard of human rights, safety or
property. The Company's Articles provide that to the fullest extent permitted by
law, no director of the Company will be personally liable to the Company or its
shareholders for damages for breach of any duty owed to the Company or its
shareholders.
Delaware law permits a corporation to adopt a provision in its certificate
of incorporation (and Cyber-Centrix's Certificate has adopted such a provision)
eliminating or limiting the personal liability of a director to the corporation
or its stockholders for monetary damages for breach of fiduciary duty as a
director, except that such provision will not limit the liability of a director
for (i) any breach of the director's duty of loyalty to the corporation or its
stockholders, (ii) acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law, (iii) liability under
Section 174 of the DGCL for unlawful payment of dividends or stock purchases or
redemptions, or (iv) any transaction from which the director derived an improper
personal benefit. The Certificate also adds the statement that if the DGCL is
amended after the effective date of this article to authorize corporate action
further eliminating or limiting the personal liability of directors, then the
liability of a director of the Corporation
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will be eliminated or limited to the fullest extent permitted by the DGCL as so
amended. Furthermore, any repeal or modification of the foregoing limitation of
director liability by the stockholders of the Corporation will not adversely
affect the right or protection of a director of the Corporation existing at the
time of such repeal or modification.
Preemptive Rights
Under the FBCA, shareholders of a corporation have no preemptive rights
unless provided for in the articles of incorporation. The Company's Articles
state that the shareholders have no preemptive rights except to the extent such
right may be granted by an amendment to the articles or by a resolution of the
Board.
Delaware law does not provide, except in limited instances, for preemptive
rights to acquire a corporation's unissued stock. Such right may be expressly
granted to the stockholders, however, in a corporation's certificate of
incorporation. Cyber-Centrix's Certificate expressly states that no preemptive
rights will exist with respect to shares of stock or securities convertible into
shares of stock of the Corporation.
Special Redemption Provisions
The FBCA permits a corporation to acquire its own shares, unless the
articles of incorporation do no permit it. The Company's bylaws provide that, if
a persons acquiring control shares of the Company does not file an acquiring
person statement with the Company, the Company may, at the discretion of the
Board, redeem the control shares at the fair value thereof at any time during
the 60-day period after the last acquisition of such control shares. If a person
acquiring control shares of the Company files an acquiring person statement with
the Company, the control shares may be redeemed by the Company, at the
discretion of the Board, only if such shares are not accorded full voting rights
by the shareholders as provided by law.
Under the DGCL, a corporation may purchase or redeem shares of any class of
its capital stock, but subject generally to the availability of sufficient
lawful funds therefor and provided that at all times, at the time of any such
redemption, the corporation will have outstanding shares of one (1) or more
classes or series of capital stock which have full voting rights that are not
subject to redemption. Cyber-Centrix's Certificate does not contain any
additions to these statutory provisions.
Shareholder Suits
Under the FBCA, a person may not bring a derivative action unless the
person was a shareholder of the corporation at the time of the challenged
transaction or unless the person acquired such shares by operation of law from a
person who was a shareholder at such time. The Company's Articles or bylaws do
not have any additions to these statutory provisions.
Under Delaware law, a stockholder may institute a lawsuit against one or
more directors, either on his own behalf or derivatively on behalf of the
corporation. An individual stockholder may also commence a lawsuit on behalf of
himself and other similarly situated stockholders when the requirements for
maintaining a class action under Delaware law have been met. Cyber-Centrix's
Certificate and bylaws do not contain any additions to these statutory
provisions.
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Business Combination Restrictions
The FBCA provides that the approval of the holder of two-thirds (2/3) of
the voting shares of a company, other than the shares beneficially owned by an
Interested Stockholder (as defined below), would be required to effectuate
certain transactions, including without limitation (i) a merger or
consolidation, (ii) certain sales of assets, (iii) certain sales of shares, (iv)
liquidation or dissolution of the corporation, (v) reclassification or
recapitalization of securities or (vi) any loans or other financial assistance
where an Invested Shareholder would benefit directly or indirectly involving a
corporation and an Interested Stockholder (an "Affiliated Transaction"). An
"Interested Stockholder" is defined as the beneficial owner of more than 10% of
the voting shares outstanding. The foregoing special voting requirement is in
addition to the vote required by any other provision of the FBCA.
The special voting requirement does not apply in any of the following
circumstances: (i) the Affiliated Transaction is approved by a majority of the
corporation's disinterested directors; (ii) the Interested Stockholder has owned
at least 80% of the corporation's voting stock for five (5) years preceding the
announcement of the event; (iii) the Interested Stockholder owns more than 90%
of the corporation's voting shares; (iv) the corporation has not had more than
300 shareholders of record at any time during the three (3) years preceding the
announcement of the event; (v) the corporation is an investment company
registered under the Investment Company Act of 1940; or (vi) all of the
following conditions are met: (a) the cash and fair market value of other
consideration to be paid per share to all holders of voting shares equals the
highest per share price as determined by statute; (b) the consideration to be
paid in the Affiliated Transaction is in the same form as previously paid by the
Interested Stockholder (or certain alternative benchmarks if higher); (c) during
the portion of the three (3) years proceeding the announcement date that the
Interested Stockholder has been an Interested Stockholder, except as approved by
a majority of the disinterested directors, there will have been no default in
payment of any full periodic dividends, no decrease in common stock dividends,
and no increase in the voting shares owned by the Interested Stockholder, (d)
during such three (3) year period no benefit to the Interested Stockholder in
the form of loans, guaranties or other financial assistance or tax advantages
has been provided by the corporation, and (e) unless approved by a majority of
the disinterested directors, a proxy will have been mailed to holders of voting
shares at least 25 days prior to the consummation of the Affiliated Transaction.
The Company's Articles provide that any provisions relating to any control
share acquisition as contained in Florida Statutes, now or hereafter amended,
and any successor provisions will not be applied to the Company.
In general, the DGCL prevents an "Interested Stockholder" (defined
generally as a person with 15% or more of a corporation's outstanding voting
stock, with the exception of any person who owned and has continued to own
shares in excess of the 15% limitation since December 23, 1987 or acquired the
shares from an interested stockholder, by gift, inheritance or in a transaction
where no consideration was exchanged) from engaging in a Business Combination
with a Delaware corporation for three (3) years following the date such person
became an Interested Stockholder. The term "Business Combination" includes
mergers or consolidations with an Interested Stockholder and certain other
transactions with an Interested Stockholder, including, without limitation: (i)
any merger or consolidation of the corporation or any direct or indirect
majority-owned subsidiary of the corporation with the Interested Stockholder or
with any other entity if the merger or consolidation is caused by the Interested
Stockholder; (ii) any sale, lease, exchange, mortgage, pledge, transfer or other
disposition (in one transaction or a series of transactions) except
proportionately as a stockholder of such corporation, to or with the Interested
Stockholder, whether as part of a dissolution or otherwise, of assets having an
aggregate market value equal to 10% or more of the aggregate market value of all
assets of the corporation or of certain subsidiaries thereof determined on a
consolidated basis or the aggregate market value of all the
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outstanding stock of the corporation; (iii) any transaction which results in the
issuance or transfer by the corporation or by certain subsidiaries thereof of
stock of the corporation or such subsidiary to the Interested Stockholder,
except pursuant to certain transfers in a conversion or exchange or pro rata
distribution to all stockholders of the corporation or certain other
transactions, none of which increase the Interested Stockholder's proportionate
ownership of any class or series of the corporation's or such subsidiary's
stock; (iv) any transaction involving the corporation or certain subsidiaries
thereof which has the effect, directly or indirectly, of increasing the
proportionate share of the stock of any class or series, or securities
convertible into stock of the corporation or any subsidiary which is owned by
the Interested Stockholder except as a result of immaterial changes due to
fractional share adjustments or as a result of any purchase or redemption of any
shares of stock not caused directly or indirectly by the Interested Stockholder;
or (v) any receipt by the Interested Stockholder of the benefit (except
proportionately as a stockholder of such corporation) of any loans, advances,
guarantees, pledges, or other financial benefits provided by or through the
corporation or certain subsidiaries.
The three (3) year moratorium may be avoided if: (i) before such person
became an Interested Stockholder, the board of directors of the corporation
approved either the Business Combination or the transaction in which the
Interested Stockholder became an Interested Stockholder, or (ii) upon
consummation of the transaction which resulted in the stockholder becoming an
Interested Stockholder, the Interested Stockholder owned at least 85% of the
voting stock of the corporation outstanding at the time the transaction
commenced (excluding shares owned by directors who are also officers of the
corporation and by employee stock ownership plans that do not provide employees
with the right to determine confidentially whether shares held subject to the
plan will be tendered in a tender or exchange offer); or (iii) at or subsequent
to such time the Business Combination is approved by the board of directors of
the corporation and authorized at an annual or special meeting of stockholders
(not by written consent) by the affirmative vote of the stockholders of at least
66 2/3% of the outstanding voting stock of the corporation not owned by the
Interested Stockholder.
The Business Combination restrictions described above do not apply if,
among other things: (i) the corporation's original certificate of incorporation
contains a provision expressly electing not to be governed by the statute; (ii)
the corporation by action by the holders of a majority of the voting stock of
the corporation approves an amendment to its certificate of incorporation or
bylaws expressly electing not to be governed by the statute (effective twelve
(12) months after the amendment's adoption), which amendment will not be
applicable to any business combination with a person who was an Interested
Stockholder at or prior to the time of the amendment; or (iii) the corporation
does not have a class of voting stock that is (a) listed on a national
securities exchange, (b) authorized for quotation on Nasdaq or other market; or
(c) held of record by more than 2,000 stockholders. The statute also does not
apply to certain Business Combinations with an Interested Stockholder when such
combination is proposed after the public announcement of, and before the
consummation or abandonment of, a merger or consolidation, a sale or other
disposition of 50% or more of the aggregate market value of the assets of the
corporation on a consolidated basis or the aggregate market value of all
outstanding shares of the corporation, or a tender or exchange offer for 50% or
more of the outstanding voting shares of the corporation, if the triggering
transaction is with or by a person who either was not an Interested Stockholder
during the previous three (3) years or who became an Interested Stockholder with
Board of Director approval, and if the transaction is approved or not opposed by
a majority of the current directors who were also directors prior to any person
becoming an Interested Stockholder during the previous three (3) years.
Cyber-Centrix is subject to the Business Combination restrictions described
above, and Cyber-Centrix's Certificate does not contain a provision electing not
to be governed by the Business Combination restrictions.
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Federal Tax Consequences
The following discussion summarizes the material anticipated United States
federal income tax consequences relevant to the exchange of the Company common
stock for Cyber-Centrix common stock pursuant to the Merger. This discussion is
based on currently existing provisions of the Internal Revenue Code of 1986, as
amended (the "Code"), existing and proposed Treasury Regulations thereunder and
current administrative rulings and court decisions, all of which are subject to
change and differing interpretation. Any such change, which may or may not be
retroactive, could alter the United States federal income tax consequences to
the Company, Cyber-Centrix and shareholders of the Company as described herein.
The Company's shareholders should be aware that this discussion does not
deal with all United States federal income tax considerations that may be
relevant to particular Company shareholders in light of their particular
circumstances, such as shareholders who are dealers in securities, banks or
other financial institutions, insurance companies, mutual funds or tax exempt
organizations, shareholders who are subject to the alternative minimum tax
provisions of the Code, who are foreign persons (i.e., persons other than (i)
citizens or individual residents of the United States, (ii) corporations or
partnerships created or organized in or under the laws of the United States or
of any political subdivision thereof, (iii) estates whose income is taxable in
the United States irrespective of source and (iv) trusts subject to the primary
supervision of a court within the United States and control of a United States
fiduciary as described Section 7701(a)(30) of the Code), who do not hold their
Company common stock as capital assets within the meaning of Section 1221 of the
Code, who acquired their Company common stock in connection with stock option or
stock purchase plans or in other compensatory transactions or who hold their
Company common stock as part of a hedging, straddle, conversion or other risk
reduction transaction. Also, the following discussion does not address the tax
consequences under Sections 1045 and 1202 of the Code with respect to shares of
"qualified small business stock" (within the meaning of Section 1202 of the
Code) or under Section 1244 of the Code with respect to shares of "section 1244
stock" (within the meaning of Section 1244 of the Code). In addition, the
following discussion does not address the tax consequences of transactions
effectuated prior or subsequent to, or concurrently with, the Merger (whether or
not any such transactions are undertaken in connection with the Merger),
including without limitation any exercise of any Company stock option or any
transaction in which shares of the Company or Cyber-Centrix capital stock are
acquired or shares of Cyber-Centrix capital stock are disposed of. Nor does the
following discussion address the United States federal income tax consequences
of the Merger to holders of Company stock options, stock warrants or debt
instruments. The following discussion does not address the tax consequences of
the Merger under foreign, state or local tax laws. ACCORDINGLY, HOLDERS OF THE
COMPANY COMMON STOCK ARE URGED TO CONSULT THEIR OWN TAX ADVISORS AS TO THE
SPECIFIC TAX CONSEQUENCES TO THEM OF THE MERGER, INCLUDING THE APPLICABLE
FEDERAL, STATE, LOCAL AND FOREIGN TAX CONSEQUENCES.
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The Merger is intended to qualify as a "reorganization" under Section
368(a)(1)(F) or 368(a)(1)(A) of the Code. Assuming the Merger qualifies as a
reorganization for purposes of the Code, then, subject to the assumptions,
limitations and qualifications referred to herein, the Merger will result in the
following United States federal income tax consequences:
o No gain or loss will be recognized for United States federal income
tax purposes by holders of the Company common stock who exchange their
Company common stock solely for Cyber-Centrix common stock in the
Merger.
o The aggregate tax basis of the Cyber-Centrix common stock received by
a holder of the Company common stock in the Merger will be the same as
the aggregate tax basis of the Company common stock surrendered
therefor in the Merger.
o The holding period of the Cyber-Centrix common stock received by a
holder of the Company common stock in the Merger will include the
period for which the Company common stock surrendered therefor in the
Merger was held.
o A holder of the Company common stock who exercises dissenters' rights
and is paid solely cash with respect to all of his Company common
stock generally will recognize capital gain or loss measured by the
difference between the amount of cash received and the tax basis of
such shares of the Company common stock. Such capital gain or loss
will be long-term capital gain or loss if the shares of the Company
common stock exchanged by such dissenting shareholder have been held
for more than one year. Notwithstanding the foregoing, the amount of
cash received may be treated as ordinary dividend income under the
rules of Sections 302 and 318 of the Code. Holders of the Company
common stock who dissent from the Merger and are paid cash for their
shares of the Company common stock are urged to consult their own tax
advisors regarding the potential application of these rules. Any
amount received pursuant to the exercise of dissenters' rights which
is treated as interest will be taxable as ordinary income.
o The Company and Cyber-Centrix will not recognize any gain or loss
solely as a result of the Merger.
Holders of the Company common stock will also be required to file certain
information with their United States federal income tax returns and to retain
certain records with regard to the Merger.
No ruling has been or will be obtained from the IRS in connection with the
Merger. A successful challenge by the IRS to the qualification of the Merger as
a "reorganization" within the meaning of Section 368(a) of the Code would result
in holders of the Company common stock recognizing a taxable gain or loss for
each share of the Company common stock surrendered, equal to the difference
between the shareholder's basis in that share and the fair market value, as of
the effective date of the Merger, of the Cyber-Centrix common stock received in
exchange for the Company share. This gain or loss would generally be treated as
capital gain or loss for each Company shareholder. In that event, a holder of
the Company common stock would have an aggregate basis in Cyber-Centrix common
stock received equal its fair market value at the effective date of the Merger
and the holding period for such Cyber-Centrix common stock would begin on the
day after the effective date of the Merger. In addition, in the event that the
Merger does not qualify as a reorganization, the Company would be treated as
selling all of its assets to Cyber-Centrix in a fully taxable transaction and
the Company would recognize taxable gain or loss on such sale.
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Amounts received by certain noncorporate shareholders of the Company may be
subject to backup withholding at a rate of 31%. However, backup withholding will
not apply to a shareholder who either (i) furnishes a correct taxpayer
identification number and certifies that he or she is not subject to backup
withholding by completing the substitute Form W-9 that will be included as part
of the transmittal letter, or (ii) otherwise proves to Cyber-Centrix and its
exchange agent that the shareholder is exempt from backup withholding.
THE PRECEDING DISCUSSION IS INTENDED ONLY AS A SUMMARY OF MATERIAL UNITED
STATES FEDERAL INCOME TAX CONSEQUENCES OF THE MERGER AND DOES NOT PURPORT TO BE
A COMPLETE ANALYSIS OR DICUSSION OF ALL POTENTIAL TAX EFFECTS RELEVANT THERETO.
THUS, HOLDERS OF THE COMPANY COMMON STOCK ARE URGED TO CONSULT THEIR OWN TAX
ADVISORS AS TO THE SPECIFIC TAX CONSEQUENCES TO THEM OF THE MERGER, INCLUDING
TAX RETURN REPORTING REQUIREMENTS, THE APPLICABILITY AND EFFECT OF FEDERAL,
STATE, LOCAL, FOREIGN AND OTHER APPLICABLE TAX LAWS AND THE EFFECT OF ANY
PROPOSED CHANGES IN THE LAW.
Securities Act Consequences
The shares of Cyber-Centrix's common stock to be issued in exchange for
shares of the Company's Common Stock are not being registered under the
Securities Act of 1933, as amended (the "Securities Act"). In that regard, the
Company is relying on Rule 145(a)(2) under the Securities Act, which provides
that a merger which has "as its sole purpose" a change in the domicile of a
corporation does not involve the sale of securities for purposes of the
Securities Act, and on interpretations of the Rule by the Securities and
Exchange Commission (the "SEC") which indicate that the making of certain
changes in the surviving corporation's charter documents which could otherwise
be made only with the approval of the shareholders of either corporation does
not render Rule 145(a)(2) inapplicable.
After the Merger, Cyber-Centrix will be a publicly-held company,
Cyber-Centrix common stock will be listed for trading in the over-the-counter
market, and Cyber-Centrix will file periodic reports and other documents with
the SEC and provide to its stockholders the same types of information that the
Company has previously filed and provided. Shareholders whose Common Stock is
freely tradeable before the Merger will have freely tradeable shares of
Cyber-Centrix common stock. Shareholders holding restricted shares of the
Company's Common Stock will have shares of Cyber-Centrix common stock which are
subject to the same restrictions on transfer as those to which their present
shares of the Company's Common Stock are subject, and their stock certificates,
if surrendered for replacement certificates representing shares of
Cyber-Centrix's common stock, will bear the same restrictive legend as appears
on their present stock certificates. For purposes of computing compliance with
the holding period requirement of Rule 144 under the Securities Act,
shareholders will be deemed to have acquired their shares of Cyber-Centrix's
common stock on the date they acquired their shares of the Company's Common
Stock. In summary, Cyber-Centrix and its stockholders will be in the same
respective positions under the federal securities laws after the Merger as were
the Company and the shareholders prior to the Merger.
PROPOSAL 2
ELECTION OF DIRECTORS
The directors to be elected at the Annual Meeting will serve on the Board
until the 2001 Annual Meeting of Shareholders or until their earlier retirement,
resignation or removal. Jasbir Dhaliwal, Damon Poole, and Raeanne Steele, who
constitute the current directors of the Company, have all been nominated
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by the Board for election at the Annual Meeting. The accompanying proxy will be
voted for these nominees, except where you indicate otherwise or authority to so
vote is withheld. Should any of these individuals be unable to serve, the proxy
will be voted for such person(s) as is designated by the Board.
Nominees for Director
Jasbir Dhaliwal has served as a director since April 1999. Since November
1998, Mr. Dhaliwal has also served as an Associate Professor with the Technical
University of British Columbia and as the Director of its Centre for Electronic
Commerce. Prior to November 1998, Mr. Dhaliwal served as the Deputy Director of
the Centre for Management of Technology for the National University of Singapore
from July 1993 to November 1998. Mr. Dhaliwal obtained his Bachelor of
Accounting with Honors from the University of Malaya, Malaysia, and a Masters in
Business Administration and Doctorate in Management Information Service from the
University of British Columbia.
Damon Poole has served as the President, Chief Executive Officer and a
director since June 2000. From December 1998 to the present, Mr. Poole has also
worked as an independent venture capitalist, where he has been actively involved
in the structuring and funding of numerous technology ventures. Prior to
December 1998, Mr. Poole served as a registered representative (stockbroker) for
Canaccord Capital Corp. (a former Brink, Hudson & Lefevre division) from May
1998 to December 1998. From November 1997 to May 1998, Mr. Poole served as a
registered representative (stockbroker) for Pacific International Securities
Ltd. Prior to November 1997, Mr. Poole served as a registered representative
(stockbroker) for Whalen Beliveau & Associates from November 1996 to November
1997. From November 1993 to November 1996, Mr. Poole served as a registered
representative (stockbroker) for C.M. Oliver & Company, Ltd.
Raeanne Steele has served as the Executive Vice-President of Sales and
Marketing since January 1999 and as a director since June 1999. From January
1990 to January 1999, Ms. Steele served as a private consultant providing
contractual services to the private and public sector in business development,
market research, business planning, and communications. Ms. Steele received a
Bachelor of Arts in Education and Master in Business Administration from the
University of Alberta.
THE BOARD UNANIMOUSLY RECOMMENDS A VOTE "FOR" ALL THE NOMINEES NAMED IN
PROPOSAL 2.
BOARD OF DIRECTORS
The business of the Company is managed under the direction of the Board.
The Board has responsibility for establishing broad corporate policies and for
the overall performance of the Company. It is not, however, involved in
operating details on a day-to-day basis. The Company has determined that the
Board will be composed of five (5) directors. Each director is elected for a
period of one (1) year at the annual meeting of shareholders and serves until
the next annual meeting or until his or her successor is duly elected and
qualified. Proxies may not be voted for a greater number of persons than the
number of nominees named.
During the fiscal year ended December 31, 1999, the Board consisted of the
following individuals: Eric Littman (resigned January 1999), John Jones
(resigned June 1999), Richard Stewart (appointed April 1999), Jasbir Dhaliwal
(appointed April 1999), Philip Garratt (appointed June 1999), Raeanne Steele
(appointed June 1999), and Mitchell Eggers (appointed June 1999). Three (3)
directors currently serve on the Board, with two (2) vacancies existing. Of the
three (3) directors currently serving on the Board, only two (2) directors,
namely Jasbir Dhaliwal and Raeanne Steele, served on the Board
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<PAGE>
during the fiscal year ended December 31, 1999. The Company intends to appoint
individuals to fill the vacancies on the Board after it identifies suitable
candidates.
Meetings of the Board
The Board meets on a regularly scheduled basis during the year to review
significant developments affecting the Company and to act on matters requiring
Board approval. It also holds special meetings when an important matter requires
Board action between regularly scheduled meetings. The Board met one (1) time
during the Company's fiscal year ended December 31, 1999, with action taken by
unanimous written consent on 16 occasions. No incumbent member attended fewer
than 94% of the total number of meetings (including consents) of the Board and
of any Board committees of which he or she was a member during that fiscal year.
Compensation of Directors
Directors of the Company do not receive cash compensation for their
services as directors or members of committees of the Board, but are reimbursed
for their reasonable expenses incurred in attending Board or Committee meetings.
The Company's 1999 Stock Option Plan, as amended (the "Plan"), permits the
grant of options for the purchase of shares of Common Stock to directors of the
Company.
On July 26, 1999, Philip Garratt was granted an option under the Plan to
purchase 150,000 shares of Common Stock, of which 50,000 shares are at an
exercise price of $5.00 per share, 50,000 shares are at an exercise price of
$6.00 per share and 50,000 shares are at an exercise price of $6.00 per share,
which are exercisable on May 10, 2000, May 10, 2001 and May 10, 2002,
respectively. On February 7, 2000, the Company and Mr. Garratt agreed to reduce
the shares subject to the option from 150,000 to 100,000, with 33,000 shares at
an exercise price of $5.00 per share, 33,000 shares at an exercise price of
$6.00 per share, and 34,000 shares at an exercise price of $6.00 per share. The
vesting period was also amended such that the option vests according to the
following schedule: 33,000 shares at July 10, 2000, 33,000 shares at July 10,
2001 and 34,000 shares at July 10, 2002, respectively.
On July 26, 1999, Mitchell Eggers was granted an option under the Plan to
purchase 165,000 shares of Common Stock, of which 50,000 shares are at an
exercise price of $5.00 per share, 50,000 shares are at an exercise price of
$6.00 per share and 65,000 shares are at an exercise price of $6.00 per share,
which are exercisable on May 10, 2000, May 10, 2001 and May 10, 2002,
respectively. On February 7, 2000, the Company and Mr. Eggers agreed to reduce
the shares subject to the option from 165,000 to 50,000, with 25,000 shares at
an exercise price of $5.00 per share, 12,500 shares at an exercise price of
$6.00 per share, and 12,500 shares at an exercise price of $6.00 per share. The
vesting period was also amended such that the option vests according to the
following schedule: 25,000 shares at July 10, 2000, 12,500 shares at July 10,
2001 and 12,500 shares at July 10, 2002, respectively. On March 17, 2000, the
Company and Mr. Eggers agreed to further reduce the shares subject to the option
from 50,000 to 25,000, with an exercise price of $5.00. The vesting period was
also amended such that the option vests immediately.
On July 26, 1999, Raeanne Steele was granted an option under the Plan to
purchase 100,000 shares of Common Stock, of which 33,000 shares are at an
exercise price of $5.00 per share, 33,000 shares are at an exercise price of
$6.00 per share and 34,000 shares are at an exercise price of $6.00 per share,
which are exercisable on May 10, 2000, May 10, 2001 and May 10, 2002,
respectively. On March 17, 2000, the Company and Ms. Steele agreed to reduce the
shares subject to the option from 100,000 to
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25,000, with an exercise price of $5.00. The vesting period was also amended
such that the option vests immediately.
On July 26, 1999, Jasbir Dhaliwal was granted an option under the Plan to
purchase 55,000 shares of Common Stock, of which 10,000 shares are at an
exercise price of $5.00 per share, 15,000 shares are at an exercise price of
$6.00 per share and 30,000 shares are at an exercise price of $6.00 per share,
which are exercisable on May 10, 2000, May 10, 2001 and May 10, 2002,
respectively. On March 17, 2000, the Company and Mr. Dhaliwal agreed to amend
the vesting period such that the option vests according to the following
schedule: 10,000 shares at July 10, 2000, 15,000 shares at July 10, 2001 and
30,000 shares at July 10, 2002, respectively.
There were no other option grants to named directors of the Company in
1999.
Committees of the Board
In July 1999, the board of directors established an Audit Committee, which
currently is its only standing board committee. The Audit Committee, which was
composed of Jasbir Dhaliwal and Philip Garratt, did not meet during the fiscal
year ended December 31, 1999. Due to Mr. Garratt's resignation in June 2000,
only one director is currently appointed to the Audit Committee. The Audit
Committee needs a minimum of two (2) directors in order to function. Until
another director is appointed to the Audit Committee, all functions previously
handled by the Audit Committee are being handled by the full Board.
The Board has not adopted a written charter for the Audit Committee,
however, its responsibilities generally include recommending independent
accountants to the Company to audit the Company's financial statements,
discussing the scope and results of the audit with the independent accountants,
reviewing the Company's interim and year-end operating results with the
Company's executive officers and the Company's independent accountants,
considering the adequacy of the internal accounting controls, considering the
audit procedures of the Company and reviewing the non-audit services to be
performed by the independent accountants.
VOTING SECURITIES AND PRINCIPAL HOLDERS
Ownership Information
The following table sets forth certain information known to the Company
with respect to the beneficial ownership of its common stock as of August 24,
2000, by (i) each person known by the Company to be the beneficial owner of more
than 5% of the outstanding Common Stock, (ii) each director of the Company,
(iii) each named executive officer, and (iv) all directors and officers as a
group. Except as otherwise indicated, the Company believes that the beneficial
owners of the Common Stock listed below, based on information furnished by such
owners, have sole investment and voting power with respect to such shares,
subject to community property laws where applicable.
<TABLE>
Number of Shares Percent of Total
Directors, Named Executive Officers and 5% Shareholders(1) Beneficially Owned(2) Shares Owned(3)
---------------------------------------------------------- --------------------- ---------------
<S> <C> <C>
Damon Poole.............................. - -
Raeanne Steele........................... 25,000 *
Jasbir Dhaliwal.......................... 10,000 *
All Directors and Officers as a group.... 68,000 *
.........
</TABLE>
* constitutes less than one 1 percent (1%) of all issued and outstanding
shares of Common Stock.
----------
(1) Unless otherwise indicated, the address of each beneficial owner is that of
the Company.
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<PAGE>
(2) Beneficial ownership is determined in accordance with the rules of the SEC,
based on factors including voting and investment power with respect to
shares. Common stock subject to options currently exercisable, or
exercisable within 60 days after August 24, 2000, are deemed outstanding
for computing the percentage ownership of the person holding such options,
but are not deemed outstanding for computing the percentage ownership for
any other person. Applicable percentage ownership based on aggregate common
stock outstanding as of August 24, 2000, together with the applicable
options of such shareholder.
(3) Based on an aggregate of 7,063,116 shares of Company's Common Stock issued
and outstanding as of August 24, 2000. Common stock subject to options
currently exercisable, or exercisable within 60 days after August 24, 2000,
are deemed outstanding for computing the percentage of ownership of the
person(s) holding such options, but are not deemed outstanding for purposes
of computing the percentage ownership of any other person.
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities and Exchange Act of 1934, as amended (the
"Exchange Act"), requires that the Company's officers and directors, and persons
who own more than ten percent (10%) of a registered class of the Company's
equity securities, file reports of ownership and changes of ownership with the
SEC. Officers, directors and greater than ten percent (10%) shareholders are
required by SEC regulation to furnish the Company with copies of all such
reports they file.
Based solely on its review of the copies of such reports received by the
Company, and on written representations by the Company's officers and directors
regarding their compliance with the applicable reporting requirements under
Section 16(a) of the Exchange Act, the Company believes that, with respect to
its fiscal year ended December 31, 1999, all of the Company's directors and
officers and all of the persons known to the Company to own more than ten
percent (10%) of the Company's Common Stock, either failed to file, on a timely
basis, or have yet to file the required beneficial ownership reports with the
SEC.
The initial ownership reports on Form 3 for options granted to purchase
shares of Common Stock under the Company's 1999 Stock Option Plan (the "Plan")
were not filed on a timely basis with the SEC for Philip Garratt, Raeanne
Steele, Damon Poole, Patrick Stewart, Mitchell Eggers and Jasbir Dhaliwal. In
addition, an initial ownership report on Form 3 for the shares of Common Stock
held by Richard Stewart has not been filed to date with the SEC. Statements of
changes in beneficial ownership on Form 4 were not filed on a timely basis in
connection with the agreed upon reductions in options granted to purchase shares
of Common Stock for Philip Garratt, Raeanne Steele and Mitchell Eggers, who was
obligated to file on Form 4 on two (2) separate occasions in connection with
such agreed upon reductions. A statement of changes in beneficial ownership on
Form 4 was not filed on a timely basis for Patrick McGrath in connection with an
option to purchase shares of Common Stock under the Plan. A Statement of changes
in beneficial ownership on Form 4 in connection with the Company's redemption of
the shares of Common Stock held by Richard Stewart has not been filed to date
with the SEC.
Compensation Committee Interlocks and Insider Participation
The Company currently has not established a compensation committee. Philip
Garratt, who was appointed President and Chief Executive Officer of the Company
and its subsidiary in June 1999, John Jones, who was appointed President of the
Company in January 1999 and resigned in June 1999, Eric Litmann, who was
appointed President of the Company in January 1999 and resigned in June 1999,
and Mitchell Eggers, who was appointed Chief Operating Officer of the Company
and its subsidiary in June 1999, all participated, during the last completed
fiscal year, in the deliberations of the Board regarding
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<PAGE>
executive officer compensation. No executive officer of the Company serves as a
member of the board of directors or compensation committee of any entity that
has one or more executive officers servings as a member of the Board. In
addition, no interlocking relationship exists between any member of the Board
and any member of the compensation committee of any other company, nor has any
such interlocking relationship existed in the past.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Transactions with Management and Others
Except as otherwise disclosed herein, no director, senior officer,
principal shareholder, or any associate or affiliate thereof, had any material
interest, direct or indirect, in any transaction since the beginning of the last
financial year of the Company that has materially affected the Company, or any
proposed transaction that would materially affect the Company, except for an
interest arising from the ownership of shares of the Company where the member
will receive no extra or special benefit or advantage not shared on a pro rata
basis by all holders of shares in the capital of the Company.
On May 26, 1999, the Company acquired Shopping Sherlock, Inc., a Delaware
corporation ("SSI"), an entity unrelated to the Company and controlled by
Richard Stewart, a former director of the Company. The sole asset of SSI was the
Strategic Alliance Agreement. Under the terms of the acquisition, entities
controlled by Mr. Stewart received an aggregate of 1,800,000 shares of the
Company's Common Stock.
From January 1999 to December 31, 1999, the Company reimbursed 5215
Holdings Ltd., a company for which Philip Garratt, the former Chief Executive
Officer and a director of the Company, is the sole shareholder and serves as a
director, $57,781 for costs associated with the start-up of the Company's
product development office in Vancouver. The Company paid 5215 Holdings Ltd.
rent of $5,400 a month for the premises in Vancouver. This was an informal
agreement that was cancelled January 3, 2000.
On February 4, 1999, the Company, through its wholly-owned subsidiary,
entered into the Strategic Alliance Agreement with Premier Lifestyles
International Corporation ("PLIC"), a corporation controlled by Richard Stewart.
Under the terms of the agreement, PLIC granted the Company the right to directly
market the Company's online stores to members of PLIC's rebate shopping network,
to place links to its website on websites sponsored by PLIC and to distribute
memberships in PLIC's rebate shopping network. In addition, PLIC agreed to
provide or to introduce the Company to transaction processing, product
fulfillment and helpdesk services providers and to give the Company access to
its list of participating merchants and product inventory on an ongoing basis.
In exchange, the Company agreed, on an exclusive basis, to sell, market and
honor PLIC product rebate network memberships and, subject to certain
exceptions, to use PLIC's transaction processing and product fulfillment
services. The Strategic Alliance Agreement was for a perpetual duration, but
could be terminated by either party for cause. The Company paid to PLIC a
one-time payment of $150,000 upon signing of the Strategic Alliance Agreement.
On January 27, 2000, the Company entered into the Redemption Agreement with
PLIC, the Stewart Family Partners (the "Partnership"), and Richard Stewart under
which the Company agreed to transfer a worldwide, non-exclusive, perpetual,
fully-paid-up license to use, distribute or make derivative works from the
Company's software that operates the Essentially Yours Industries, Inc. website
and the usrebatewarehouse.com website in consideration for the redemption of
approximately 2,000,000 shares of common stock by the Company that PLIC and the
Partnership owned or had a right to purchase. On March 14, 2000, the
shareholders of the Company at a special shareholder meeting approved of the
terms
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<PAGE>
of the Redemption Agreement and, as a result, the approximately 2,000,000 shares
of common stock of the Company that PLIC and the Partnership owned or had a
right to purchase were redeemed by the Company and were deemed authorized but
unissued shares of the Company pursuant to Florida law.
COMPENSATION AND BENEFITS
Executive Officer Compensation
The following table sets forth the compensation paid to the Company's Chief
Executive Officer and its two (2) previous Presidents, who served in the
capacity of chief executive officer prior to the Company's shareholders adopting
amended bylaws in June 1999, wherein the position, title and responsibilities of
the Chief Executive Officer were designated, for the year ended December 31,
1999.
<TABLE>
Summary Compensation Table
Long-Term
Compensation
Annual Compensation Securities
Name and Principal Position Salary Bonus Underlying Options
--------------------------- ------ ----- ------------------
<S> <C> <C> <C> <C>
Philip Garratt (1).................. 1999 $ 111,863(2) - 150,000
President, Chief Executive Officer
and Chairman
John Jones(3) 1999 $ 27,500 - -
President, Treasurer, Secretary and a
director
Eric Litmann(4) 1999 - - -
President, Treasurer, Secretary and a
director
------------
</TABLE>
(1) Mr. Garratt was appointed Chief Executive Officer in June 1999.
(2) Includes $20,000 paid to 5215 Holding Ltd., a company that Mr. Garratt is
the sole shareholder and serves as a director.
(3) Mr. Jones was appointed President in January 1999 and resigned in June
1999.
(4) Mr. Litmann was appointed President in July 1998 and resigned in January
1999.
Option Grants in Last Fiscal Year
The following table sets forth certain information regarding stock option
grants to the Company's Chief Executive and its two (2) previous Presidents, who
served in the capacity of chief executive officer prior to the Company's
shareholders adopting amended bylaws in June 1999, wherein the position, title
and responsibilities of the Chief Executive Officer were designated, during the
year ended December 31, 1999. The potential realizable value is calculated based
on the assumption that the common stock appreciates at the annual rate shown,
compounded annually, from the date of grant until the expiration of its term.
These numbers are calculated based on SEC requirements and do not reflect the
Company's projection or estimate of future stock price growth. Potential
realizable values are computed by:
o multiplying the number of shares of common stock subject to a given
option by the exercise price;
o assuming that the aggregate stock value derived from that calculation
compounds at the annual five percent (5%) or ten percent (10%) rate
shown in the table for the entire ten (10) year term of the option;
and
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<PAGE>
o subtracting from that result the aggregate option exercise price.
<TABLE>
Option Grants in 1999
---------------------
Individual Grants
------------------------------------------------------------------------
Number of Securities Percent of Total Exercise Expiration Potential Realizable
Underlying Options Options Granted Price (per Date Value at Assumed
Granted to Employees in share) (2) Date Annual Rates of Stock
Fiscal Year (1) Price Appreciation for
Option Term
Name 5% 10%
---- ----------------------
<S> <C> <C> <C> <C> <C> <C>
Philip Garratt........ 150,000(3) 18.89% $5.00(4) 5/10/04 $1.57 $3.46
John Jones............ - - - - - -
Eric Litmann.......... - - - - - -
------------
</TABLE>
(1) During 1999, options to purchase 794,000 shares were issued to employees.
(2) The exercise price per share was equal to the fair market value of the
Company's Common Stock on the date of grant as determined by the board of
directors.
(3) Represents an option vesting according to the following schedule: 50,000
shares vesting at one year, 50,000 shares vesting at two years, and 50,000
shares vesting at three years.
(4) Mr. Garratt's option exercise price is $5.00 in year one and $6.00 in years
two and three.
Option Exercises and Fiscal Year-End Values
The following table sets forth for the Company's Chief Executive Officer
and its two (2) previous Presidents, who served in the capacity of chief
executive officer prior to the Company's shareholders adopting amended bylaws in
June 1999, wherein the position, title and responsibilities of Chief Executive
Officer were designated, the number of shares acquired upon exercise of stock
options during the year ended December 31, 1999 and the number of shares subject
to exercisable and unexercisable stock options held at December 31, 1999.
<TABLE>
Aggregated Option Exercises in 1999
and Year-End Option Values
Number of
Securities Underlying
Unexercised Options Value of Unexercised
at In-the-Money Options at
Shares December 31, 1999 December 31, 1999(1)
Acquired ----------------- ------------------------
on Value
Name Exercise Realized Exercisable Unexercisable Exercisable Unexercisable
---- -------- -------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Philip Garratt.................. - $ - - 150,000 $ - $ 500,000
John Jones...................... - $ - - - $ - $ -
Eric Litmann.................... - $ - - - $ - $ -
------------
</TABLE>
(1) The value of unexercised in-the-money options at December 31, 1999 is based
on $9.00 per share, the closing price of the Common Stock at such time,
less the exercise price per share.
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<PAGE>
Report on Executive Compensation
The Board is responsible for determining the compensation for the Company's
executive officers, and for reviewing and approving compensation recommendations
made by the Chief Executive Officer for the other officers and key employees.
The Board is also responsible for administering all of the Company's
compensation programs.
In determining the base salary for a particular executive within the salary
range for his or her position, the Board initially takes into account the salary
necessary to encourage the executive to join the Company in lieu of pursuing
other employment opportunities. In later years, the Board considers the amount
budgeted for salary increases and the executive's success in achieving the
performance objectives established for such executive, his or her department and
the Company.
In July 1999, the Company adopted a stock option program whereby Company
executives and employees are eligible to receive an option to purchase a number
of shares of the Company's Common Stock within a predetermined range on the date
of hire. In later years, the Board considers individual, departmental, and
Company performance objectives in granting additional options to individual
employees. As a result, the option program is another element of the two-pronged
compensation strategy developed by the Company to compensate its employees,
including its senior executives. The Board believes this compensation strategy
closely aligns the interests of executives and other key employees to that of
the Company and its shareholders, and also serves to attract and retain high
quality employees.
The Company's Chief Executive Officer does not participate in Board
discussions, nor does he act as a member with respect to matters related to the
Chief Executive Officer compensation. The compensation of the Chief Executive
Officer is determined under the same policies and criteria as the compensation
of the other executive officers.
Under the Omnibus Budget Reconciliation Act of 1993, the federal income tax
deduction for certain types of compensation paid to the chief executive officer
and four other most highly compensated executive officers of publicly held
companies is limited to $1 million per officer per fiscal year unless such
compensation meets certain requirements. The Committee is aware of this
limitation and believes no compensation paid by the Company during 1999 will
exceed the $1 million limitation.
THE BOARD OF DIRECTORS
Jasbir Dhaliwal
Damon Poole
Raeanne Steele
Performance Graph
Set forth below is a graph comparing the cumulative total return to
shareholders on the Company's Common Stock with the cumulative total return of
the Nasdaq Composite Index and the Russell 2000 SmallCap Index for the period
beginning on March 31, 1999 (the date the Company began to be actively quoted on
the Over-The-Counter Bulletin Board), and ended on December 31, 1999.
[TABLE SHOWN BELOW IS A TABULAR REPRESENTATION OF LINE GRAPH]
[PERFORMANCE GRAPH]
March 31, 1999 December 31, 1999
------------------ -----------------
ASPi Europe, Inc. $100.00 $167.31
Nasdaq Composite Index $100.00 $154.06
Russell 2000 SmallCap Index $100.00 $118.87
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<PAGE>
The total return on the Common Stock and each index assumes the value of
each investment was $100 on March 31, 1999, and that all dividends were
reinvested, although dividends have not been declared on the Company's Common
Stock. Return information is historical and not necessarily indicative of future
performance.
PROPOSAL 3
THE SELECTION OF BDO SEIDMAN, LLP AS INDEPENDENT AUDITORS
The Board requests that the shareholders ratify its selection of BDO
Seidman, LLP, as independent auditors for the Company for the current fiscal
year. If the shareholders do not ratify the selection of BDO Seidman, LLP,
another firm of certified public accountants will be selected as independent
auditors by the Board.
On June 29, 1999, at the request of the Company, Barry L. Friedman, P.C.,
("Friedman") resigned as its accountant engaged to audit the Company's financial
statements. Friedman's report on the financial statements for the period prior
to such resignation did not contain any adverse opinion, disclaimer of opinion
or was qualified or modified as to uncertainty, audit scope or accounting
principles. During the period preceding such resignation, Mr. Friedman and the
Company did not have any disagreements on any matter of accounting principles or
practices, financial statement disclosure or auditing scope or procedure. The
decision to engage BDO Seidman, LLP as the Company's accountant to audit its
financial statements was recommended by the Board.
Representatives of BDO Seidman, LLP are not anticipated to be present at
the Annual Meeting. Written questions may be directed to BDO Seidman, LLP at One
Union Square, 600 University, Suite 2400, Seattle, Washington 98101.
THE BOARD UNANIMOUSLY RECOMMENDS A VOTE "FOR" THE ratification of the
selection of BDO Seidman, LLP as independent auditors for the company for fiscal
year 2000.
OTHER MATTERS
Management is not aware of any other matters to be presented for action at
the Annual Meeting. If any other matter is properly presented, however, it is
the intention of the persons named in the enclosed form of proxy to vote in
accordance with their best judgment on such matter.
SOLICITATION OF PROXIES
This solicitation is made on behalf of the Board of Directors of the
Company. Proxies may be solicited by officers, directors, and regular employees
of the Company in person or by mail, telephone, telegraph, facsimile or
messenger.
COST OF SOLICITATION
The Company will bear the costs of the solicitation of proxies from its
shareholders. The Company has not incurred any expenses related to this proxy
solicitation to date, and the Company anticipates it will not incur any material
expenses in the future related to the solicitation of proxies from its
shareholders. Directors, officers and employees of the Company will not be
compensated additionally for the solicitation of proxies for the Annual Meeting,
but may be reimbursed for out-of-pocket expenses in connection with the
solicitation, which will be at the discretion of the Board. Arrangements are
also being made with brokerage houses and any other custodians, nominees and
fiduciaries for the forwarding of solicitation material to the beneficial owners
of common stock, and the Company will reimburse the
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<PAGE>
brokers, custodians, nominees and fiduciaries for their reasonable out-of-pocket
expenses.
SHAREHOLDER PROPOSALS
Proposals by shareholders of the Company which are intended to be presented
by those shareholders at the next annual meeting must be received by the Company
no later than May 8, 2001 in order to have them included in the Proxy Statement
and form of proxy relating to that annual meeting.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ Damon Poole
-------------------------------------
Damon Poole, Chief Executive Officer
September 5, 2000
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<PAGE>
ASPI EUROPE, INC.
ANNUAL MEETING OF SHAREHOLDERS
September 5, 2000
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF ASPI EUROPE, INC.
THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED IN ACCORDANCE WITH THE
CHOICES SPECIFIED BELOW.
The undersigned shareholder of ASPi Europe, Inc. (the "Company") hereby appoints
Damon Poole and Patrick McGrath, and each of them, the true and lawful
attorneys, agents and proxies of the undersigned with full powers of
substitution and resubstitution for and in the name of the undersigned, each to
vote all of the shares of the Company's common stock which the undersigned may
be entitled to vote at the Annual Meeting of Shareholders of the Company to be
held at 11:00 A.M. local time on Tuesday, September 26, 2000 at the principal
offices of the Company at Two Union Square, Suite 4200, 601 Union Street,
Seattle, Washington 98101, and any and all adjournments or postponements
thereof, with all of the powers which the undersigned would possess if
personally present, for the following purposes:
FOR AGAINST ABSTAIN
1. To approve the redomicile of the Company's [ ] [ ] [ ]
place of incorporation from Florida to Delaware.
2. Election of directors:
FOR Jasbir Dhaliwal [ ]
WITHHOLD AUTHORITY to vote for Jasbir Dhaliwal [ ]
FOR Damon Poole [ ]
WITHHOLD AUTHORITY to vote for Damon Poole [ ]
FOR Raeanne Steele [ ]
WITHHOLD AUTHORITY to vote for Raeanne Steele [ ]
FOR the nominee listed below [ ]
------------------------
FOR the nominee listed below [ ]
------------------------
FOR AGAINST ABSTAIN
3. To ratify the selection of BDO Seidman, LLP [ ] [ ] [ ]
as independent auditors for the Company for fiscal
Year 2000.
4. In their discretion the Proxies are authorized to vote upon such other
business as may properly come before the meeting.
THIS PROXY WILL BE VOTED FOR THE CHOICES SPECIFIED. IF NO CHOICE IS SPECIFIED
FOR THE ABOVE PROPOSALS, THIS PROXY WILL BE VOTED FOR APPROVAL OF THE PROPOSALS.
-30-
<PAGE>
PLEASE MARK, SIGN AND RETURN THE PROXY PROMPTLY USING THE ENCLOSED ENVELOPE.
The undersigned hereby acknowledges receipt of the Notice of Annual Meeting and
Proxy Statement dated ___________, 2000.
-------------------------------- ------------------------
(Signature) (Date)
--------------------------------
(Signature, if jointly held)
--------------------------------
(Printed name(s))
--------------------------------
(Representative capacity, if applicable)
Please sign exactly as the name(s) appears on the stock certificate(s). Joint
owners should each sign. Trustees and others acting in a representative capacity
should indicate the capacity in which they sign.
-31-
<PAGE>
ANNEX A
The 1999 Florida Statutes
Title XXXVI
BUSINESS ORGANIZATIONS Chapter 607
607.1301 Dissenters' rights; definitions.--The following definitions apply to
ss. 607.1302 and 607.1320:
(1) "Corporation" means the issuer of the shares held by a dissenting
shareholder before the corporate action or the surviving or acquiring
corporation by merger or share exchange of that issuer.
(2) "Fair value," with respect to a dissenter's shares, means the value of the
shares as of the close of business on the day prior to the shareholders'
authorization date, excluding any appreciation or depreciation in anticipation
of the corporate action unless exclusion would be inequitable.
(3) "Shareholders' authorization date" means the date on which the shareholders'
vote authorizing the proposed action was taken, the date on which the
corporation received written consents without a meeting from the requisite
number of shareholders in order to authorize the action, or, in the case of a
merger pursuant to s. 607.1104, the day prior to the date on which a copy of the
plan of merger was mailed to each shareholder of record of the subsidiary
corporation.
History -- s. 118, ch. 89-154.
607.1302 Right of shareholders to dissent.--
(1) Any shareholder of a corporation has the right to dissent from, and obtain
payment of the fair value of his or her shares in the event of, any of the
following corporate actions:
(a) Consummation of a plan of merger to which the corporation is a party:
1. If the shareholder is entitled to vote on the merger, or
2. If the corporation is a subsidiary that is merged with its parent under s.
607.1104, and the shareholders would have been entitled to vote on action taken,
except for the applicability of s. 607.1104;
(b) Consummation of a sale or exchange of all, or substantially all, of the
property of the corporation, other than in the usual and regular course of
business, if the shareholder is entitled to vote on the sale or exchange
pursuant to s. 607.1202, including a sale in dissolution but not including a
sale pursuant to court order or a sale for cash pursuant to a plan by which all
or substantially all of the net proceeds of the sale will be distributed to the
shareholders within 1 year after the date of sale;
(c) As provided in s. 607.0902(11), the approval of a control-share acquisition;
(d) Consummation of a plan of share exchange to which the corporation is a party
as the corporation the shares of which will be acquired, if the shareholder is
entitled to vote on the plan;
(e) Any amendment of the articles of incorporation if the shareholder is
entitled to vote on the amendment and if such amendment would adversely affect
such shareholder by:
1. Altering or abolishing any preemptive rights attached to any of his or her
shares;
<PAGE>
2. Altering or abolishing the voting rights pertaining to any of his or her
shares, except as such rights may be affected by the voting rights of new shares
then being authorized of any existing or new class or series of shares;
3. Effecting an exchange, cancellation, or reclassification of any of his or her
shares, when such exchange, cancellation, or reclassification would alter or
abolish the shareholder's voting rights or alter his or her percentage of equity
in the corporation, or effecting a reduction or cancellation of accrued
dividends or other arrearages in respect to such shares;
4. Reducing the stated redemption price of any of the shareholder's redeemable
shares, altering or abolishing any provision relating to any sinking fund for
the redemption or purchase of any of his or her shares, or making any of his or
her shares subject to redemption when they are not otherwise redeemable;
5. Making noncumulative, in whole or in part, dividends of any of the
shareholder's preferred shares which had theretofore been cumulative;
6. Reducing the stated dividend preference of any of the shareholder's preferred
shares; or
7. Reducing any stated preferential amount payable on any of the shareholder's
preferred shares upon voluntary or involuntary liquidation; or
(f) Any corporate action taken, to the extent the articles of incorporation
provide that a voting or nonvoting shareholder is entitled to dissent and obtain
payment for his or her shares.
(2) A shareholder dissenting from any amendment specified in paragraph (1)(e)
has the right to dissent only as to those of his or her shares which are
adversely affected by the amendment.
(3) A shareholder may dissent as to less than all the shares registered in his
or her name. In that event, the shareholder's rights shall be determined as if
the shares as to which he or she has dissented and his or her other shares were
registered in the names of different shareholders.
(4) Unless the articles of incorporation otherwise provide, this section does
not apply with respect to a plan of merger or share exchange or a proposed sale
or exchange of property, to the holders of shares of any class or series which,
on the record date fixed to determine the shareholders entitled to vote at the
meeting of shareholders at which such action is to be acted upon or to consent
to any such action without a meeting, were either registered on a national
securities exchange or designated as a national market system security on an
interdealer quotation system by the National Association of Securities Dealers,
Inc., or held of record by not fewer than 2,000 shareholders.
(5) A shareholder entitled to dissent and obtain payment for his or her shares
under this section may not challenge the corporate action creating his or her
entitlement unless the action is unlawful or fraudulent with respect to the
shareholder or the corporation.
History -- s. 119, ch. 89-154; s. 5, ch. 94-327; s. 31, ch. 97-102.
607.1320 Procedure for exercise of dissenters' rights.--
(1)(a) If a proposed corporate action creating dissenters' rights under s.
607.1302 is submitted to a vote at a shareholders' meeting, the meeting notice
shall state that shareholders are or may be entitled to assert dissenters'
rights and be accompanied by a copy of ss. 607.1301, 607.1302, and 607.1320. A
shareholder who wishes to assert dissenters' rights shall:
<PAGE>
1. Deliver to the corporation before the vote is taken written notice of the
shareholder's intent to demand payment for his or her shares if the proposed
action is effectuated, and
2. Not vote his or her shares in favor of the proposed action. A proxy or vote
against the proposed action does not constitute such a notice of intent to
demand payment.
(b) If proposed corporate action creating dissenters' rights under s. 607.1302
is effectuated by written consent without a meeting, the corporation shall
deliver a copy of ss. 607.1301, 607.1302, and 607.1320 to each shareholder
simultaneously with any request for the shareholder's written consent or, if
such a request is not made, within 10 days after the date the corporation
received written consents without a meeting from the requisite number of
shareholders necessary to authorize the action.
(2) Within 10 days after the shareholders' authorization date, the corporation
shall give written notice of such authorization or consent or adoption of the
plan of merger, as the case may be, to each shareholder who filed a notice of
intent to demand payment for his or her shares pursuant to paragraph (1)(a) or,
in the case of action authorized by written consent, to each shareholder,
excepting any who voted for, or consented in writing to, the proposed action.
(3) Within 20 days after the giving of notice to him or her, any shareholder who
elects to dissent shall file with the corporation a notice of such election,
stating the shareholder's name and address, the number, classes, and series of
shares as to which he or she dissents, and a demand for payment of the fair
value of his or her shares. Any shareholder failing to file such election to
dissent within the period set forth shall be bound by the terms of the proposed
corporate action. Any shareholder filing an election to dissent shall deposit
his or her certificates for certificated shares with the corporation
simultaneously with the filing of the election to dissent. The corporation may
restrict the transfer of uncertificated shares from the date the shareholder's
election to dissent is filed with the corporation.
(4) Upon filing a notice of election to dissent, the shareholder shall
thereafter be entitled only to payment as provided in this section and shall not
be entitled to vote or to exercise any other rights of a shareholder. A notice
of election may be withdrawn in writing by the shareholder at any time before an
offer is made by the corporation, as provided in subsection (5), to pay for his
or her shares. After such offer, no such notice of election may be withdrawn
unless the corporation consents thereto. However, the right of such shareholder
to be paid the fair value of his or her shares shall cease, and the shareholder
shall be reinstated to have all his or her rights as a shareholder as of the
filing of his or her notice of election, including any intervening preemptive
rights and the right to payment of any intervening dividend or other
distribution or, if any such rights have expired or any such dividend or
distribution other than in cash has been completed, in lieu thereof, at the
election of the corporation, the fair value thereof in cash as determined by the
board as of the time of such expiration or completion, but without prejudice
otherwise to any corporate proceedings that may have been taken in the interim,
if:
(a) Such demand is withdrawn as provided in this section;
(b) The proposed corporate action is abandoned or rescinded or the shareholders
revoke the authority to effect such action;
(c) No demand or petition for the determination of fair value by a court has
been made or filed within the time provided in this section; or
(d) A court of competent jurisdiction determines that such shareholder is not
entitled to the relief provided by this section.
<PAGE>
(5) Within 10 days after the expiration of the period in which shareholders may
file their notices of election to dissent, or within 10 days after such
corporate action is effected, whichever is later (but in no case later than 90
days from the shareholders' authorization date), the corporation shall make a
written offer to each dissenting shareholder who has made demand as provided in
this section to pay an amount the corporation estimates to be the fair value for
such shares. If the corporate action has not been consummated before the
expiration of the 90-day period after the shareholders' authorization date, the
offer may be made conditional upon the consummation of such action. Such notice
and offer shall be accompanied by:
(a) A balance sheet of the corporation, the shares of which the dissenting
shareholder holds, as of the latest available date and not more than 12 months
prior to the making of such offer; and
(b) A profit and loss statement of such corporation for the 12-month period
ended on the date of such balance sheet or, if the corporation was not in
existence throughout such 12-month period, for the portion thereof during which
it was in existence.
(6) If within 30 days after the making of such offer any shareholder accepts the
same, payment for his or her shares shall be made within 90 days after the
making of such offer or the consummation of the proposed action, whichever is
later. Upon payment of the agreed value, the dissenting shareholder shall cease
to have any interest in such shares.
(7) If the corporation fails to make such offer within the period specified
therefor in subsection (5) or if it makes the offer and any dissenting
shareholder or shareholders fail to accept the same within the period of 30 days
thereafter, then the corporation, within 30 days after receipt of written demand
from any dissenting shareholder given within 60 days after the date on which
such corporate action was effected, shall, or at its election at any time within
such period of 60 days may, file an action in any court of competent
jurisdiction in the county in this state where the registered office of the
corporation is located requesting that the fair value of such shares be
determined. The court shall also determine whether each dissenting shareholder,
as to whom the corporation requests the court to make such determination, is
entitled to receive payment for his or her shares. If the corporation fails to
institute the proceeding as herein provided, any dissenting shareholder may do
so in the name of the corporation. All dissenting shareholders (whether or not
residents of this state), other than shareholders who have agreed with the
corporation as to the value of their shares, shall be made parties to the
proceeding as an action against their shares. The corporation shall serve a copy
of the initial pleading in such proceeding upon each dissenting shareholder who
is a resident of this state in the manner provided by law for the service of a
summons and complaint and upon each nonresident dissenting shareholder either by
registered or certified mail and publication or in such other manner as is
permitted by law. The jurisdiction of the court is plenary and exclusive. All
shareholders who are proper parties to the proceeding are entitled to judgment
against the corporation for the amount of the fair value of their shares. The
court may, if it so elects, appoint one or more persons as appraisers to receive
evidence and recommend a decision on the question of fair value. The appraisers
shall have such power and authority as is specified in the order of their
appointment or an amendment thereof. The corporation shall pay each dissenting
shareholder the amount found to be due him or her within 10 days after final
determination of the proceedings. Upon payment of the judgment, the dissenting
shareholder shall cease to have any interest in such shares.
(8) The judgment may, at the discretion of the court, include a fair rate of
interest, to be determined by the court.
(9) The costs and expenses of any such proceeding shall be determined by the
court and shall be assessed against the corporation, but all or any part of such
costs and expenses may be apportioned and assessed as the court deems equitable
against any or all of the dissenting shareholders who are parties to the
proceeding, to whom the corporation has made an offer to pay for the shares, if
the court finds that the action of such
<PAGE>
shareholders in failing to accept such offer was arbitrary, vexatious, or not in
good faith. Such expenses shall include reasonable compensation for, and
reasonable expenses of, the appraisers, but shall exclude the fees and expenses
of counsel for, and experts employed by, any party. If the fair value of the
shares, as determined, materially exceeds the amount which the corporation
offered to pay therefor or if no offer was made, the court in its discretion may
award to any shareholder who is a party to the proceeding such sum as the court
determines to be reasonable compensation to any attorney or expert employed by
the shareholder in the proceeding.
(10) Shares acquired by a corporation pursuant to payment of the agreed value
thereof or pursuant to payment of the judgment entered therefor, as provided in
this section, may be held and disposed of by such corporation as authorized but
unissued shares of the corporation, except that, in the case of a merger, they
may be held and disposed of as the plan of merger otherwise provides. The shares
of the surviving corporation into which the shares of such dissenting
shareholders would have been converted had they assented to the merger shall
have the status of authorized but unissued shares of the surviving corporation.
History -- s. 120, ch. 89-154; s. 35, ch. 93-281; s. 32, ch. 97-102.
<PAGE>
ANNEX B
AGREEMENT AND PLAN OF MERGER
This AGREEMENT AND PLAN OF MERGER (the "Merger Agreement") is made as of
this ___ day of ___________, 2000, by and between ASPi Europe, Inc., a Florida
corporation (the "Parent") and Cyber-Centrix Corporation, a Delaware corporation
(the "Subsidiary").
RECITALS:
WHEREAS, the Parent is a corporation organized and existing under the laws
of the State of Florida;
WHEREAS, the Subsidiary is a corporation organized and existing under the
laws of the State of Delaware and is a wholly-owned subsidiary of the Parent;
WHEREAS, the parties hereto desire that the Parent merge with and into the
Subsidiary and that the Subsidiary shall continue as the surviving corporation
in such merger, which is intended to qualify as a tax-free reorganization under
Section 368(a)(1)(F) or 368(a)(1)(A) of the Internal Revenue Code of 1986, as
amended, upon the terms and subject to the conditions herein set forth and in
accordance with the laws of the State of Florida and the laws of the State of
Delaware (the "Merger").
NOW THEREFORE, the parties hereto hereby agree as follows:
ARTICLE I
PRINCIPAL TERMS OF THE MERGER
Section 1.1. Merger of Parent into Subsidiary. At the Effective Time of the
Merger (as defined in Section 1.2 hereof), the Parent shall merge with and into
the Subsidiary in accordance with the Florida Business Corporation Act (the
"FBCA") and the Delaware General Corporation Law (the "DGCL"). The separate
existence of the Parent shall thereupon cease and the Subsidiary shall be the
surviving corporation (hereinafter sometimes referred to as the "Surviving
Corporation") and shall continue its corporate existence under the laws of the
State of Delaware.
Section 1.2. Effective Time of the Merger. The Merger shall become
effective as of the date and time (the "Effective Time of the Merger") the
following actions are completed: (a) appropriate articles of merger are filed
with the Secretary of State of the State of Florida, and a certificate of merger
is issued by the Secretary of State of the State of Florida in accordance with
the FBCA and (b) an appropriate certificate of merger is filed with the
Secretary of the State of Delaware in accordance with the DGCL.
Section 1.3. Effects of the Merger. At the Effective Time of the Merger,
the Merger shall have the effects specified in the FBCA, the DGCL and this
Merger Agreement.
Section 1.4. Certificate of Incorporation and Bylaws. At the Effective Time
of the Merger, the Certificate of Incorporation and bylaws of the Subsidiary, as
in effect immediately prior to the Effective Time of the Merger, shall become
the Certificate of Incorporation and bylaws of the Surviving Corporation until
duly amended in accordance with their terms and as provided by the DGCL.
Section 1.5. Directors and Officers. At the Effective Time of the Merger,
the directors and officers of the Subsidiary in office at the Effective Time of
the Merger shall become the directors and officers, respectively, of the
Surviving Corporation, each of such directors and officers to hold office,
<PAGE>
subject to the applicable provisions of the Certificate of Incorporation and
bylaws of the Surviving Corporation and the DGCL, until his or her successor is
duly elected or appointed and qualified.
Section 1.6 Shareholders' Dissenters Rights. The Shareholders of the Parent
are entitled to dissenters' rights under sections 607.1301, 607.1302 and
607.1320 of the FBCA. In the event that shareholders collectively owning more
than one percent (1%) of the shares of the Parent exercise his, her or its
dissenters' rights, the Parent's board of directors may abandon the Merger in
its sole discretion.
ARTICLE II
CONVERSION AND EXCHANGE OF STOCK
Section 2.1. Conversion. At the Effective Time of the Merger, each of the
following transactions shall be deemed to occur simultaneously:
(a) Each share of the Parent's common stock, $0.001 par value (the
"Parent's Common Stock") issued and outstanding, immediately prior to the
Effective Time of the Merger shall, by virtue of the Merger and without any
action on the part of the holder thereof, be converted into and become one
validly issued, fully paid and nonassessable share of the Subsidiary's common
stock, par value $0.001 per share (the "Subsidiary's Common Stock").
(b) Each option to purchase shares of the Parent's Common Stock outstanding
immediately prior to the Effective Time of the Merger shall, by virtue of the
Merger and without any action on the part of the holder thereof, be converted
into and become an option to purchase, upon the same terms and conditions, the
number of shares of the Subsidiary's Common Stock, which is equal to the number
of shares of the Parent's Common Stock that the optionee would have received had
the optionee exercised such option in full immediately prior to the Effective
Time of the Merger (whether or not such option was then exercisable). The
exercise price per share under each of said options shall be equal to the
exercise price per share thereunder immediately prior to the Effective Time of
the Merger.
(c) Each warrant to purchase shares of the Parent's Common Stock
outstanding immediately prior to the Effective Time of the Merger shall, by
virtue of the Merger and without any action on the part of the holder thereof,
be converted into and become a warrant to purchase, upon the same terms and
conditions, the number of shares of the Subsidiary's Common Stock which is equal
to the number of shares of the Parent's Common Stock that the warrant holder
would have received had the warrant holder exercised such warrant in full
immediately prior to the Effective Time of the Merger (whether or not such
warrant was then exercisable). The exercise price per share under each of said
warrants shall be equal to the exercise price per share thereunder immediately
prior to the Effective Time of the Merger.
(d) Each share of the Subsidiary's Common Stock issued and outstanding
immediately prior to the Effective Time of the Merger and held by the Parent
shall be canceled without any consideration being issued or paid therefor.
Section 2.2. Exchange.
(a) After the Effective Time of the Merger, each certificate theretofore
representing issued and outstanding shares of the Parent's Common Stock shall
represent the same number of shares of the Subsidiary's Common Stock.
(b) At any time on or after the Effective Time of the Merger, any holder of
certificates theretofore evidencing ownership of shares of the Parent's Common
Stock will be entitled, upon surrender of such
<PAGE>
certificates to the transfer agent of the Surviving Corporation, to receive in
exchange therefor one or more new stock certificates evidencing ownership of the
number of shares of the Subsidiary's Common Stock, into which the Parent's
Common Stock shall have been converted in the Merger. If any certificate
representing shares of the Subsidiary's Common Stock is to be issued in a name
other than that in which the certificate surrendered in exchange therefor is
registered, it shall be a condition of the issuance thereof that the certificate
so surrendered shall be properly endorsed and otherwise in proper form for
transfer and that the person requesting such exchange shall pay to the transfer
agent any transfer or other taxes required by reason of the issuance of a
certificate representing shares of the Parent's Common Stock in any name other
than that of the registered holder of the certificate surrendered, or otherwise
required, or shall establish to the satisfaction of the transfer agent that such
tax has been paid or is not payable.
ARTICLE III
EMPLOYEE BENEFIT AND INCENTIVE COMPENSATION PLANS
At the Effective Time of the Merger, each employee benefit plan, incentive
compensation plan and other similar plans to which the Parent is then a party
shall be assumed by, and continue to be the plan of, the Surviving Corporation.
To the extent any employee benefit plan, incentive compensation plan or other
similar plan of the Parent provides for the issuance or purchase of, or
otherwise relates to, the Parent's Common Stock, after the Effective Time of the
Merger such plan shall be deemed to provide for the issuance or purchase of, or
otherwise relate to, the Subsidiary's Common Stock.
ARTICLE IV
CONDITIONS
Consummation of the Merger is subject to the satisfaction at or prior to
the Effective Time of the Merger of the following conditions:
Section 4.1. Shareholder Approval. This Merger Agreement and the Merger
shall have been adopted and approved by the affirmative vote of a majority of
the votes entitled to be cast by all shareholders entitled to vote on the record
date fixed for determining the shareholders of the Parent entitled to vote
thereon. This Agreement and the Merger shall also have been adopted and approved
by the Parent as the holder of all the outstanding shares of the Subsidiary's
Common Stock prior to the Effective Time of the Merger.
Section 4.2. Third Party Consents. The Parent shall have received all
required consents to and approvals of the Merger.
ARTICLE V
MISCELLANEOUS
Section 5.1. Amendment. This Merger Agreement may be amended, modified or
supplemented in whole or in part, at any time prior to the Effective Time of the
Merger with the mutual consent of the boards of directors of the parties hereto;
provided, however, that the Merger Agreement may not be amended after it has
been adopted by the shareholders of the Parent in any manner which, in the
judgment of the board of directors of the Parent, would have a material adverse
effect on the rights of such shareholders or in any manner not permitted under
applicable law.
<PAGE>
Section 5.2. Termination. This Merger Agreement may be terminated or
abandoned by the parties hereto at any time prior to the filing of the
certificate of merger notwithstanding approval of this Merger Agreement by the
shareholders of either or both of the Parent or the Subsidiary.
Section 5.3. Necessary Actions, etc. If at any date after the Effective
Time of the Merger, the Surviving Corporation shall consider that any
assignments, transfers, deeds or other assurances in law are necessary or
desirable to vest, perfect or confirm, of record or otherwise, in the Surviving
Corporation, title to any property or rights of the Parent, the Parent and its
officers and directors at the Effective Time of the Merger shall execute and
deliver such documents and do all things necessary and proper to vest, perfect
or confirm title to such property or rights in the Surviving Corporation, and
the officers and directors of the Surviving Corporation are fully authorized in
the name of the Parent or otherwise to take any and all such action.
Section 5.4. Counterparts. This Merger Agreement may be executed in any
number of counterparts, each of which shall be considered to be an original
instrument.
Section 5.5. Descriptive Headings. The descriptive headings are for
convenience of reference only and shall not control or affect the meaning or
construction of any provision of this Merger Agreement.
Section 5.6. Governing Law. This Merger Agreement shall be construed in
accordance with the laws of the State of Delaware, except to the extent the laws
of the State of Florida shall mandatorily apply to the Merger.
IN WITNESS WHEREOF, the undersigned officers of each of the parties to this
Merger Agreement, pursuant to authority duly given by their respective boards of
directors, have caused this Merger Agreement to be duly executed on the date set
forth above.
Attested to by: ASPI EUROPE, INC.
------------------------ -------------------------------
Patrick McGrath Damon Poole
Secretary Chief Executive Officer and President
Attested to by: CYBER-CENTRIX CORPORATION
------------------------- -------------------------------
Patrick McGrath Damon Poole
Secretary Chief Executive Officer and President
<PAGE>
CERTIFICATES
The undersigned, Secretary of Cyber-Centrix Corporation, a Delaware
corporation, hereby certifies, pursuant to Section 252(c) of the General
Corporation Law of the State of Delaware, that the foregoing Agreement and Plan
of Merger to which this Certificate is attached, after having been first duly
signed on behalf of Cyber-Centrix Corporation by its Chief Executive Officer and
attested to by its Secretary, was duly submitted to the sole stockholder of
Cyber-Centrix Corporation for the purpose of considering and acting upon said
Agreement and Plan of Merger, on the ____ day of ___________, 2000, and at said
meeting said Agreement and Plan of Merger was adopted by the sole stockholder of
Cyber-Centrix Corporation, in accordance with the General Corporation Law of the
State of Delaware.
IN WITNESS WHEREOF, the undersigned has executed this Certificate on the
_____ day of _______________, 2000.
--------------------------
Patrick McGrath, Secretary
The undersigned, Secretary of ASPi Europe, Inc., a Florida corporation,
hereby certifies, pursuant to Section 252(c) of the General Corporation Law of
the State of Delaware, that the foregoing Agreement and Plan of Merger to which
this Certificate is attached, after having been first duly signed on behalf of
ASPi Europe, Inc. by its President and attested to by its Secretary, was duly
submitted to the shareholders of ASPi Europe, Inc. at a meeting thereof called
for the purpose of considering and acting upon said Agreement and Plan of
Merger, held after due notice on the _____ day of __________, 2000, and that at
said meeting said Agreement and Plan of Merger was adopted by the shareholders
of ASPi Europe, Inc. in accordance with the Florida Business Corporation Act of
1989.
IN WITNESS WHEREOF, the undersigned has executed this Certificate on the
____ day of ____________, 2000.
--------------------------
Patrick McGrath, Secretary
