================================================================================
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
AMENDMENT NO.1
TO
FORM 10-KSB
[X] ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the year ended June 30, 2000
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15 (d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from ________________ to _________________
Commission file number 0-27587
CDKnet.com, Inc.
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(Name of small business issuer in its charter)
Delaware 22-3586087
--------------------------------- -------------------
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
250 West 57th Street, Suite 1101
New York, New York 10019
---------------------------------------- ----------
(Address of principal executive offices) (Zip Code)
Issuer's telephone number: (212) 547-6050
Securities registered under Section 12(b) of the Exchange Act: None
Securities registered under Section 12(g) of the Exchange Act:
Common Stock, $.0001 par value
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(Title of Class)
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. [X] Yes [ ] No
Check if there is no disclosure of delinquent filers in response to Item 405 of
Regulation S-B is not contained in this form, and no disclosure will be
contained, to the best of registrant's knowledge in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-KSB
or any amendment to this Form 10-KSB. [ ]
Issuer's revenues for its most recent fiscal year: $345,000. The aggregate
market value of the voting and non-voting common equity held by non-affiliates
computed by reference to the average high and low price of such common equity,
as of September 27, 2000 is $15,612,000.
<PAGE>
As of October 25, 2000, 21,348,178 shares of common stock, $.0001 par value,
were outstanding.
Transitional Small Business Disclosure Format (check one): [ ] Yes [X] No
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<PAGE>
EXPLANATORY NOTE
----------------
This Amendment No. 1 on Form 10-KSB amends and restates in their entirety the
following items of Part III of the Annual Report on Form 10-KSB of the
Registrant for fiscal year ended June 30, 2000, filed on October 13, 2000 (File
No. 0-27587).
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<PAGE>
PART III
--------
ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS;
COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT.
-------------------------------------------------------------
The following sets forth our directors and executive officers and key employees
as of October 25, 2000, their respective ages, the year in which each was first
elected or appointed a director, and any other office held by each director:
CDKnet.com, Inc.
----------------
NAME OF DIRECTOR/ AGE POSITION HELD DATE ELECTED
OFFICER OR APPOINTED
--------------------------------------------------------------------------------
Steven A. Horowitz 41 Chairman, Chief Executive May 1998
Officer, Chief Financial
Officer and Secretary
Andrew J. Schenker 39 Director May 1998
Anthony J. Bonomo 40 Director May 1998
A. CDKnet, LLC
--------------
NAME OF DIRECTOR/ AGE POSITION HELD DATE ELECTED
OFFICER OR APPOINTED
--------------------------------------------------------------------------------
Steven A. Horowitz 41 Chairman, Chief Financial May 1998
Officer, and Secretary
Shai Bar-Lavi 41 Chief Executive Officer August 1999
Israel Hersh 46 President February 2000
Shlomo Shur 50 Chief Operating Officer March 2000
Don Hegarty 31 Chief Technical Officer July 2000
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<PAGE>
B. ValueFlash.com Incorporated
------------------------------
NAME OF DIRECTOR/ AGE POSITION HELD DATE ELECTED
OFFICER OR APPOINTED
-------------------------------------------------------------------------------
Shai Bar-Lavi 41 Chief Executive Officer, January 2000
Chairman
Shlomo Shur 50 President, Director January 2000
Robert Reeves 49 Chief Financial and April 2000
Administrative Officer,
Treasurer and Director
Michael W. Jolly 33 Executive Vice President, January 2000
Entertainment Group
Tom Ross 51 President, Media Group January 2000
Russell A. Kern 33 Executive Vice President January 2000
Steven A. Horowitz 41 Secretary, Director January 2000
FAMILY RELATIONSHIPS
--------------------
No family relationship exists between or among any of our directors, executive
officers, and significant employees, as defined below, or any person
contemplated to become such.
BUSINESS EXPERIENCE
-------------------
STEVEN A. HOROWITZ - Chairman, Chief Executive Officer, Chief Financial Officer
and Secretary, CDKnet.com, Inc.; Chairman, Chief Financial Officer and Secretary
of CDKnet, LLC; and Secretary and Director of ValueFlash.com Incorporated.
Mr. Horowitz has served as Chairman of the Board of Directors and Secretary of
CDKnet.com since May 1998, has served as Chief Financial Officer since October
1999, and has served as the managing member of Creative Technology and CDKnet,
LLC since October, 1998 and November, 1998, respectively. Since April 1, 2000,
he has served as a partner in Moritt, Hock, Hamroff & Horowitz, LLP, a Garden
City, New York-based law firm. From October 1, 1991 to March 2000, he was the
founding principal of Horowitz, Mencher, Klosowski, & Nestler, P.C., a Garden
City, New York-based law firm. Mr. Horowitz holds a degree from Hofstra
University School of Law and a Master of Business Administration degree in
Accounting from Hofstra University School of Business. Mr. Horowitz is an
Adjunct Professor of Law at Hofstra University School of Law. In 1986 and 1987,
Mr. Horowitz was Director of Taxes for Symbol Technologies, Inc., a New York
Stock Exchange corporation. Mr. Horowitz is a member of the American Bar
Association and the New York State Bar Association.
ANTHONY J. BONOMO - Director, CDKnet.com, Inc.
Mr. Bonomo has served as a director of CDKnet.com since June, 1998. He has,
since 1986, served in various executive capacities at Administrators for the
Professions, Inc., the Physicians' Reciprocal Insurers, one of the largest
medical malpractice carriers in New York State, including Executive Vice
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<PAGE>
President and Chief Operating Officer from 1993 to 1995 and President from 1995
to the present. Mr. Bonomo is a member of the Bar of the State of New York and
serves as a board member of several charitable associations and foundations.
ANDREW J. SCHENKER - Director, CDKnet.com, Inc.
Mr. Schenker became a director of CDKnet.com in May, 1998. He is the Director of
Finance for North America Sales and Services Division at Symbol Technologies,
Inc. a manufacturer and world leader in bar-code based data transaction systems
based in Holbrook, New York. Since November 1986, he has held several financial
management positions at Symbol Technologies, Inc., most recently at the position
described above. He is also the trustee for several trusts and a public
foundation, as well as an executive committee member of the Smithtown School
District Industry Advisory Board.
SHAI BAR-LAVI - Chief Executive Officer of CDKnet, LLC, and Chief Executive
Officer and Chairman of ValueFlash.com Incorporated.
Mr. Bar Lavi joined CDKnet, LLC as its President in August 1999 but subsequently
relinquished that position to become the Chief Executive Officer of both CDKnet,
LLC and ValueFlash.com. Mr. Bar-Lavi directs the business operations and
development plans of ValueFlash and, to a lesser degree, CDKnet. From April 1999
to July 1999, Mr. Bar-Lavi served as a consultant to CDKnet, LLC. Prior to
joining CDKnet, LLC, Mr. Bar-Lavi served as Chief Operating Officer of the
Hungarian Broadcasting Corporation, a publicly-traded company, from January 1998
to December 1998. From July 1990 to December 1997, he served as President of
Topline Communications. Mr. Bar-Lavi's experience with computers goes back to
the early 1980s where he ran Sagy Computer Services, a mainframe-based company
providing payroll and accounting services.
SHLOMO SHUR - President and Director, ValueFlash.com Incorporated, and Chief
Operating Officer, CDKnet, LLC.
Mr. Shur has over 20 years of software development and technology consulting
experience. He joined CDKnet, LLC in late 1999 as Chief Operating Officer and
has also assumed the position of President of ValueFlash.com in February 2000.
Prior to joining CDKnet, Mr. Shur was a co-founder of Executone Information
Systems where he spent 15 years as a senior technology officer. Mr. Shur also
spent two years as an independent technology consultant. Mr. Shur has a Bachelor
of Sciences degree in Electrical Engineering from City College, New York.
ROBERT J. REEVES - Chief Financial and Administrative Officer, and Director of
ValueFlash.com Incorporated.
Mr. Reeves joined ValueFlash.com in April 2000. Mr. Reeves is responsible for
overseeing ValueFlash's financial and administrative operations, capital
fundraising, as well as negotiating future partnership agreements. Prior to
joining ValueFlash, Mr. Reeves was Chief Financial Officer of ABN AMRO
Incorporated, responsible for the firm's North American investment banking
business. Before joining ABN AMRO in 1997, Mr. Reeves served as ING Barings
Securities, Inc.'s Chief Financial Officer. He oversaw the investment bank's
financial operations in North, Latin and South America. Prior to ING Barings,
Mr. Reeves worked for nine years with Shearson Lehman Brothers in various
capacities, the last being Executive Vice President and Assistant Controller.
Mr. Reeves joined Shearson Lehman Brothers from Coopers & Lybrand where he spent
nine years and was a Senior Manager. Mr. Reeves is a Certified Public
Accountant.
MICHAEL W. JOLLY - Executive Vice President, Sales Director, ValueFlash.com
Incorporated.
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<PAGE>
Mr. Jolly is responsible for identifying and developing business opportunities
and strategic partnering opportunities within the entertainment industry. Mr.
Jolly joined CDKnet in November 1997. Prior to joining CDKnet, Mr. Jolly served
as Vice President of Marketing and Secretary at Kelly Music and Entertainment
Corp. (creator of CDK(TM) Technology) from October 1995 to November 1997. There
he developed music and entertainment products and built a significant amount of
music, movie and TV industry contact relationships. From August 1991 to October
1995, Mr. Jolly held positions at Cigna Financial Advisors in which he developed
programing and packaging products in the network programming and in-flight
entertainment markets as well as serving as a Financial Advisor where he
provided financial, statistical and strategic planning to businesses. Mr. Jolly
has a B.S. in Marketing from Hofstra University.
RUSSELL A. KERN - Executive Vice President, Marketing Director, ValueFlash.com
Incorporated.
Mr. Kern is a founding member of the ValueFlash.com team, joining the firm from
his position as General Manager at CDKnet, LLC. In his position as Marketing
Director at ValueFlash.com, Mr. Kern is responsible for identifying strategic
alliance/business building opportunities. Further, Mr. Kern works with the
Business Development team and the Technical team to ensure consistent branding
is maintained through all communications and product offerings. Mr. Kern joined
CDKnet in April 1998 where he was instrumental in developing the
second-generation multimedia CD technology along with CDKnet's custom multimedia
CD service, MixFactory. Prior to joining CDKnet, Mr. Kern served from November
1995 to April 1998 as Director of Strategic Planning at Poppe Tyson (now
ModemMedia), developing successful Web initiatives for a range of clients
including IBM and Minolta. From January 1994 to November 1995, he was Marketing
Director at Marketing Resources of America. He also served five years with BBDO
Advertising planning for clients such as Visa USA, Pepsi-Cola and Campbell's. In
addition, he has several years experience in direct-response marketing,
developing DRTV, print and direct-mail programs. Mr. Kern has a B.S. in
Marketing from the Wharton School at the University of Pennsylvania.
TOM ROSS - President, Entertainment Group of ValueFlash.com Incorporated.
Mr. Ross joined CDKnet in August 1999 and is responsible for identifying
business opportunities for ValueFlash within the entertainment, music and film
industries and securing partnership agreements. From December 1998 to July 1999,
Mr. Ross served as a consultant. Prior to that, Mr. Ross was a partner of
Creative Artists Agency from January 1984 to November 1998. As a founder,
architect and chief of the music department at Creative Artists, Mr. Ross worked
with some of the most celebrated artists in music: Jefferson Airplane, Crosby,
Stills & Nash, Tim McGraw, Eric Clapton, Bob Dylan, Madonna, Janet Jackson, Reba
McEntire, Bette Midler and Fleetwood Mac, to name a few. Before he left Creative
Artists late last year, many considered him the top agent in the music business.
In his 30-year career, he had the reputation of fighting on behalf of his
clients' financial interests while enabling them to present their art without
compromise.
ISRAEL HERSH - President, CDKnet, LLC.
Israel Hersh joined CDKnet, LLC in February, 2000 as President. Prior to that,
he was Vice President, Chief Technology Officer with Executone Information
Systems since January, 1999. Mr. Hersh joined Executone as Director of Software
Development in 1984, and was promoted to Vice President of Software Engineering
in January, 1995. In June, 1996, Mr. Hersh was promoted to Vice President,
Product Development of Executone's Computer Telephony Division. Prior to his
employment with Executone Information Systems, Inc. Mr. Hersh was a manager of
the Software Development Department for T-Bar, Inc. Mr. Hersh has a B.S. in
Electrical Engineering from Tel-Aviv University and a MS in Electrical
Engineering from Bridgeport University.
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<PAGE>
DON HEGARTY - Chief Technical Officer, CDKnet. LLC
Don Hegarty joined CDKnet in 1999. He is responsible for CDK software
development, overall website management, and the automated robotic processes
behind the Mixfactory.com websites. His duties also include maintaining the
order fulfillment system, programming new automation, and managing the customer
support staff. Prior to joining CDKnet he was Director of CD production at
MY-CD.com, a Bandai company. There he worked on creating one of the first
customized CD sites on the Internet. Prior to that, he lead programming for
Market Growth Resources, A True North Company, on many projects including
Tropicana, Duracell, and Mastercard. Mr. Hegarty has also worked for the Library
of Congress in creating a database system to track both Braille books and books
on tape for thousands of users across the United States. Mr. Hegarty has a B.S.
in Computer Science from Manhattan College.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Under Section 16(a) of the Securities Exchange Act of 1934, as amended, our
directors, executive officers, and any persons holding more than ten percent of
our common stock are required to report to the SEC their initial ownership of
our stock and any subsequent changes in that ownership. Based on a review of
Forms 3, 4 and 5 under the Exchange Act furnished to us, we believe that during
the fiscal year ended June 30, 2000, our officers, directors and holders of more
than 10 percent of our common stock filed all Section 16(a) reports on a timely
basis, with the exception of: (1) Steven A. Horowitz, whose sale of shares of
our common stock in March and April 2000 have not been reported, (2) Arnold and
Rachel Bodek whose initial filing on Form 3 was not reported; and (3) Alvin Pock
whose initial filing on Form 3 was not reported.
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<PAGE>
ITEM 10. EXECUTIVE COMPENSATION
----------------------
1. EXECUTIVE OFFICER COMPENSATION
CDKnet, LLC
-----------
The following table sets forth all compensation paid by us as of fiscal year
ended June 30, 2000, to all of our executive officers:
SUMMARY COMPENSATION TABLE
<TABLE><CAPTION>
--------------------------- --------- ----------------------------------- ------------------------------------------------
Annual Compensation(2)(3) Long-Term Compensation
----------------------------------- ------------------------------------------------
Awards Payouts
------------------------- ----------------------
Other Securities All Other
Annual Restricted Underlying Compen-
Name And Compen- Stock Options/ LTIP sation
Principal Position Year Salary Bonus sation Award(s) SARs Payouts ($)
($) ($) ($) ($) (#) ($) (i)
(a) (b) (c) (d) (e) (f) (g) (h)
--------------------------- --------- ------------- --------- ----------- ------------ ------------ ---------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Steven A. Horowitz(1) FY00 0 --
FY99 7,500 78,000 -- 1,500,000 -- --
--------------------------- --------- ------------- --------- ----------- ------------ ------------ ---------- -----------
Shai Bar-Lavi FY00 75,000 --
FY99 0 29,000 -- 1,000,000 -- --
--------------------------- --------- ------------- --------- ----------- ------------ ------------ ---------- -----------
Israel Hersh FY00 45,000 --
FY99 0 2,100 -- 100,000 -- --
--------------------------- --------- ------------- --------- ----------- ------------ ------------ ---------- -----------
Shlomo Shur FY00 0 --
FY99 0 23,000 -- 500,000 -- --
--------------------------- --------- ------------- --------- ----------- ------------ ------------ ---------- -----------
Michael W. Jolly FY00 50,673 --
FY99 69,615.38 0 -- 280,000 -- --
--------------------------- --------- ------------- --------- ----------- ------------ ------------ ---------- -----------
Russell A. Kern FY00 47,692 --
FY99 79,999.92 0 -- 280,000 -- --
--------------------------- --------- ------------- --------- ----------- ------------ ------------ ---------- -----------
Keith A. Fredericks FY00 63,766 --
FY99 57,499.91 0 -- -- --
--------------------------- --------- ------------- --------- ----------- ------------ ------------ ---------- -----------
Tom Ross FY00 50,000 --
FY99 0 -- 1,000,000 -- --
--------------------------- --------- ------------- --------- ----------- ------------ ------------ ---------- -----------
Don Hegarty FY00 69,160
FY99 24,500 -- 0 -- 50,000 -- --
--------------------------- --------- ------------- --------- ----------- ------------ ------------ ---------- -----------
</TABLE>
1 Mr. Horowitz is our Chairman, Chief Executive Officer, Chief Financial
Officer, and Secretary. Mr. Horowitz is considered a consultant because he
does not keep regular hours, decides his own schedule and otherwise fits the
characteristics of a consultant as promulgated under the relevant sections of
the Internal Revenue Code and Regulations and case law. During fiscal 2000,
the Company accrued $78,000 for such consulting services for Mr. Horowitz,
none of which has been paid.
2 We discontinued compensation to Messrs. Bar-Lavi, Shur, Jolly, Kern and Ross
in February 2000 upon their transition to consultants for CDKnet, LLC and to
officers of ValueFlash.com.
3 In fiscal 2001, each of the named officers are to receive salary compensation
as follows:
Steven A. Horowitz $0
Shai Bar-Lavi $0
Michael W. Jolly $0
Russell A. Kern $0
Tom Ross $0
Shlomo Shur $0
Israel Hersh $120,000
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<PAGE>
OPTION/SAR GRANTS IN LAST FISCAL YEAR
(INDIVIDUAL GRANTS)
<TABLE><CAPTION>
-------------------------- ------------------ --------------------- -------------------- -------------------
Percent Of
Number Of Total Options/
Securities SARs Granted
Underlying To Employees Exercise Or
Options/SARs In Fiscal Base Price
Name Granted (#) Year ($/Sh) Expiration Date
(a) (b) (c) (d) (e)
-------------------------- ------------------ --------------------- -------------------- -------------------
-------------------------- ------------------ --------------------- -------------------- -------------------
<S> <C> <C> <C> <C>
Steven A. Horowitz 750,000 15.83% $ .75 1/10/10
------------------ --------------------- -------------------- -------------------
------------------ --------------------- -------------------- -------------------
Shai Bar-Lavi 250,000 5.28% $1.00 1/13/05
250,000 5.28% $1.00 1/13/05
250,000 5.28% $1.00 1/13/05
750,000 15.83% $1.00 7/31/04
------------------ --------------------- -------------------- -------------------
------------------ --------------------- -------------------- -------------------
Israel Hersh 100,000 2.11% $1.00 1/30/05
------------------ --------------------- -------------------- -------------------
------------------ --------------------- -------------------- -------------------
Shlomo Shur 500,000 10.56% $1.00 1/13/05
------------------ --------------------- -------------------- -------------------
------------------ --------------------- -------------------- -------------------
Michael W. Jolly 280,000 5.91% $1.00 1/31/05
------------------ --------------------- -------------------- -------------------
------------------ --------------------- -------------------- -------------------
Russell A. Kern 60,000 5.91% $1.00 7/15/04
120,000 5.91% $1.00 7/15/04
100,000 5.91% $1.00 7/15/04
------------------ --------------------- -------------------- -------------------
------------------ --------------------- -------------------- -------------------
Tom Ross 1,000,000 21.11% $1.00 7/13/04
------------------ --------------------- -------------------- -------------------
------------------ --------------------- -------------------- -------------------
Don Hegarty 50,000 1.06% $1.00 10/1/04
------------------ --------------------- -------------------- -------------------
------------------ --------------------- -------------------- -------------------
Robert Reeves 250,000 5.28% $3.00 5/9/05
-------------------------- ------------------ --------------------- -------------------- -------------------
</TABLE>
-------------------
(1) Mr. Fredericks resigned as our Senior Vice President and Chief Technical
Officer effective December 17, 1999. At the time of his resignation, he had
10,000 options which had been grants on 12/2/98, which options were
cancelled upon his resignation.
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<PAGE>
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR AND FY-END
OPTION/SAR VALUES
<TABLE><CAPTION>
-------------------------- -------------- -------------- ------------------- -------------------
Number Of
Securities Value Of
Underlying Unexercised
Shares Unexercised In-The-Money
Acquired Options/SARs Options/SARs
On Value At FY-End (#) At FY-End ($)
Exercise Realized Exercisable/ Exercisable/
Name (#) ($) Unexercisable Unexercisable
(a) (b) (c) (d) (e)
-------------------------- -------------- -------------- ------------------- -------------------
-------------------------- -------------- -------------- ------------------- -------------------
<S> <C> <C> <C> <C>
Steven A. Horowitz 750,000 4,050,000 750,000/0 $750,000
-------------- -------------- ------------------- -------------------
-------------- -------------- ------------------- -------------------
Shai Bar-Lavi 0 0 1,500,000/0 $1,125,000
-------------- -------------- ------------------- -------------------
-------------- -------------- ------------------- -------------------
Israel Hersh 0 0 0/100,000 0
-------------- -------------- ------------------- -------------------
-------------- -------------- ------------------- -------------------
Shlomo Shur 0 0 500,000/0 $375,000
-------------- -------------- ------------------- -------------------
-------------- -------------- ------------------- -------------------
Michael W. Jolly 0 0 143,334/146,666 $107,501
-------------- -------------- ------------------- -------------------
-------------- -------------- ------------------- -------------------
Russell A. Kern 0 0 143,334/146,666 $107,501
-------------- -------------- ------------------- -------------------
-------------- -------------- ------------------- -------------------
Keith Fredericks (1) 0 0 10,000 0
-------------------------- -------------- -------------- ------------------- -------------------
</TABLE>
-------------------
(1) Mr. Fredericks resigned as our Senior Vice President and Chief Technical
Officer effective December 17, 1999. His options were canceled on
December 17, 1999.
(2) Mr. Horowitz exericised 750,000 options, exerciseable at $.60 per share on
March 28, 2000. Mr. Horowitz has an additional 750,000 at $.75, which we
granted to him on January 11, 2000. The closing price for our stock on June
30, 2000 was $1.75 per share. Therefore, Mr. Horowitz is $750,000 in the
money.
2. COMPENSATION OF DIRECTORS
None of our directors were compensated in fiscal year 2000 for their services.
Employment Agreements
In August 1999, we entered into an employment agreement with Shai Bar Lavi to
serve as President of CDKnet, LLC. The agreement provides that Mr. Lavi shall
receive: (A) an annual salary of $150,000, (B) an annual bonus determined by the
Management Committee's sole discretion, provided that Mr. Lavi's combined salary
and bonus is not exceeded by that of any of our full time employees (to a
maximum of $500,000 combined salary and bonus) and (C) a stock option to
purchase 750,000 shares of our common stock, with an exercise price of $1.00 per
share. The options will vest 25% every six months from the Commencement Date and
may be exercised in multiples of five thousand shares. Mr. Lavi may exercise up
to 50% of the options outstanding (up to an aggregate of 375,000) at any time by
converting such options into common stock. The agreement provides for a two year
term and may be terminated upon notice with or without "cause" (as defined). If
terminated without cause, Mr. Lavi is entitled to six months salary as
severance. If he resigns or is terminated for cause, our obligations under the
contract will cease (options terminate 90 days from such resignation or
termination).
In June 1999, we entered into a finders agreement with Shari Bar Lavi and
Frederick E. Smithline (together referred to as "Finders"). In return for the
Finders' efforts to introduce to us one or more parties who may be interested in
(a) the potential financing of CDKnet.com, (b) the purchase or merger with us or
(c) establishment of a joint venture with us (collectively referred to as a
"Transaction"). Under the Agreement, Mr. Smithline shall receive a five year
warrant to acquire 100,000 shares of our. common stock at an exercise price of
$1.00 per share. Additionally, we will pay Finders' Success Fees (50% to Shai
Bar Lavi and 50% to Frederick E. Smithline) as follows: (i) upon completion of a
financing transaction ((a) above) arising out of finder's introduction that
results in at least $2 million, we will issue to finder five year warrants to
purchase the greater of 500,000 shares of our common stock at $1.00 per share,
or 2.5% of our common stock outstanding at an exercise price of $1.00 per share.
If the financing is less than $2 million, the fee shall be reduced
proportionately; (ii) upon completion of a purchase or merger ((b) above), we
shall pay finder 5% of the total consideration paid to us or 5% of the total
consideration paid by us to a third party; or (iii) upon the completion of a
joint venture ((c) above), we shall pay finder an amount equal to 5% of that
portion of the venture contributed by the party. Under the agreement, we agree
to reimburse finder for reasonable out of pocket expenses incurred during its
activities effectuating this agreement. We have the right, without any liability
to the finder, to terminate discussions for the financing, purchasing or venture
involving us for any reason. The agreement has a term of twelve months, subject
to early termination by us (providing there is thirty days notice).
In August 1999, we entered into an employment agreement with Tom Ross, Executive
Vice President and Entertainment Division Chief CDKnet, LLC. The agreement
provides that Mr. Ross shall receive: (A) an annual salary of $100,000, (B) a
right to a bonus determined annually by the Management Committee, in its sole
discretion and (C) a stock option to purchase up to 1,000,000 shares of common
stock in CDKnet.com with an exercise price per share of $1.00. The options may
be exercised in multiples of five thousand shares and will vest as follows:
150,000 upon execution of the agreement, and 150,000 shares every six months
from the Commencement Date of the agreement; and 62,500 shares during the term
when our revenues reach $5 million, $10 million, $20 million and $30 million.
All of the options will vest immediately if: (1) this agreement is terminated
without cause; (2) upon the sale of all or substantially all of the assets of
the Company or 50% or more of the equity interests in us; or (3) if any third
party obtains the right to control our Management Committee. Mr. Ross may
exercise up to 50% of the options outstanding (up to an aggregate of 500,000) at
any time by converting such options into common stock.
The agreement provides for a two year term and may be terminated upon notice by
us, with or without "cause.". Mr. Ross is given the right to terminate the
agreement for "good reason.". If the agreement is terminated by us without cause
or by Mr. Ross for good cause, we must pay Mr. Ross his monthly salary
multiplied by the number of months remaining until the end of the agreement's
two year term, plus all of the outstanding but not vested options shall vest. If
he resigns or is terminated for cause, our obligations under the contract will
cease (options terminate 90 days from such resignation or termination).
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<PAGE>
ValueFlash.com Incorporated
---------------------------
The following table sets forth all compensation paid by us as of fiscal year
ended June 30, 2000, to the executive officers of our subsidiary,
ValueFlash.com:
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
--------------------------- --------- ----------------------------------- ------------------------------------------------
Annual Compensation(1) Long-Term Compensation
----------------------------------- ------------------------------------------------
Awards Payouts
------------------------- ----------------------
Securities
Other Under- All Other
Annual Restricted lying Compen-
Name And Compen- Stock Options/ LTIP sation
Principal Position Year Salary Bonus sation Award(s) SARs Payouts ($)
($) ($) ($) ($) (#) ($) (i)
(a) (b) (c) (d) (e) (f) (g) (h)
--------------------------- --------- ------------- --------- ----------- ------------ ------------ ---------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Shai Bar-Lavi FY00 75,000 0 8,400 0 1,500,000 0 0
--------------------------- --------- ------------- --------- ----------- ------------ ------------ ---------- -----------
Shlomo Shur FY00 50,000 0 9,100 0 1,000,000 0 0
--------------------------- --------- ------------- --------- ----------- ------------ ------------ ---------- -----------
Robert Reeves FY00 36,474 0 1,500 0 250,000 0 0
--------------------------- --------- ------------- --------- ----------- ------------ ------------ ---------- -----------
Michael W. Jolly FY00 41,667 0 33,950 0 300,000 0 0
--------------------------- --------- ------------- --------- ----------- ------------ ------------ ---------- -----------
Tom Ross FY00 62,500 0 -- 0 1,000,000 0 0
--------------------------- --------- ------------- --------- ----------- ------------ ------------ ---------- -----------
Steven A. Horowitz FY00 -- 0 -- 0 750,000 0 0
--------------------------- --------- ------------- --------- ----------- ------------ ------------ ---------- -----------
Russell A. Kern FY00 41,667 0 10,000 0 300,000 0 0
--------------------------- --------- ------------- --------- ----------- ------------ ------------ ---------- -----------
</TABLE>
---------------
1 In fiscal 2001, each of the named officers are to receive salary compensation
as follows:
Shai Bar-Lavi $180,000
Michael W. Jolly $100,000
Russell A. Kern $120,000
Tom Ross $150,000
Shlomo Shur $120,000
Steven A. Horowitz $ --
Robert Reeves $160,000
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<PAGE>
OPTION/SAR GRANTS IN LAST FISCAL YEAR
(INDIVIDUAL GRANTS)
<TABLE><CAPTION>
-------------------------- ------------------ --------------------- -------------------- -------------------
Percent Of
Number Of Total Options/
Securities SARs Granted
Underlying To Employees Exercise Or
Options/SARs In Fiscal Base Price
Name Granted (#) Year ($/Sh) Expiration Date
(a) (b) (c) (d) (e)
-------------------------- ------------------ --------------------- -------------------- -------------------
-------------------------- ------------------ --------------------- -------------------- -------------------
<S> <C> <C> <C> <C>
Shai Bar-Lavi 1,250,000 18.29% $1.50 1/27/05
250,000 3.66% $1.50 12/31/04
------------------ --------------------- -------------------- -------------------
------------------ --------------------- -------------------- -------------------
Shlomo Shur 750,000 10.98% $1.50 1/27/05
250,000 3.66% $1.50 12/31/04
------------------ --------------------- -------------------- -------------------
------------------ --------------------- -------------------- -------------------
Robert Reeves 250,000 3.66% $1.50 4/9/05
------------------ --------------------- -------------------- -------------------
------------------ --------------------- -------------------- -------------------
Steven A. Horowitz 750,000 10.98% $1.50 1/27/05
------------------ --------------------- -------------------- -------------------
------------------ --------------------- -------------------- -------------------
Michael W. Jolly 300,000 4.39% $1.35 1/13/05
------------------ --------------------- -------------------- -------------------
------------------ --------------------- -------------------- -------------------
Tom Ross 1,000,000 14.63% $1.35 1/13/05
------------------ --------------------- -------------------- -------------------
------------------ --------------------- -------------------- -------------------
Russell A. Kern 300,000 4.39% $1.35 1/13/05
------------------ --------------------- -------------------- -------------------
------------------ --------------------- -------------------- -------------------
Michael Vasinkevich (1) 1,250,000 18.29% $1.50 1/27/05
-------------------------- ------------------ --------------------- -------------------- -------------------
</TABLE>
--------------------------
(1) Effective October 16, 2000, Mr. Vasinkevich resigned as a director of
ValueFlash.
-13-
<PAGE>
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR AND FY-END
OPTION/SAR VALUES
<TABLE><CAPTION>
-------------------------- -------------- -------------- ------------------- -------------------
Number Of
Securities Value Of
Underlying Unexercised
Shares Unexercised In-The-Money
Acquired Options/SARs Options/SARs
On Value At FY-End (#) At FY-End ($)
Exercise Realized Exercisable/ Exercisable/
Name (#) ($) Unexercisable Unexercisable
(a) (b) (c) (d) (e)
-------------------------- -------------- -------------- ------------------- -------------------
-------------------------- -------------- -------------- ------------------- -------------------
<S> <C> <C> <C> <C>
Shai Bar-Lavi 0 0 1,250,000/250,000 0
-------------- -------------- ------------------- -------------------
-------------- -------------- ------------------- -------------------
Shlomo Shur 0 0 750,000/250,000 0
-------------- -------------- ------------------- -------------------
-------------- -------------- ------------------- -------------------
Robert Reeves 0 0 0/250,000 0
-------------- -------------- ------------------- -------------------
-------------- -------------- ------------------- -------------------
Steven A. Horowitz 0 0 750,000/0 0
-------------- -------------- ------------------- -------------------
-------------- -------------- ------------------- -------------------
Michael W. Jolly 0 0 0/300,000 0
-------------- -------------- ------------------- -------------------
-------------- -------------- ------------------- -------------------
Russell A. Kern 0 0 0/300,000 0
-------------- -------------- ------------------- -------------------
-------------- -------------- ------------------- -------------------
Tom Ross 0 0 1,000,000/0 0
-------------------------- -------------- -------------- ------------------- -------------------
</TABLE>
-------------------
2. COMPENSATION OF DIRECTORS
None of our directors were compensated in fiscal year 2000 for their services.
-14-
<PAGE>
ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
--------------------------------------------------------------
SECURITY OWNERSHIP OF CERTAIN NON-MANAGEMENT BENEFICIAL OWNERS
A. CDKnet.com, Inc.
-------------------
The following are our non-management, beneficial owners of more than 5 percent
of the outstanding shares amount of our common stock, $.001 par value, as of
October 25, 2000:
Name and Address of Amount and Nature Percent of
Beneficial Stockholder of Beneficial Ownership Class (1)(2)
---------------------- ----------------------- ------------
Alvin Pock(3) 1,352,546 6.54%
320 Bay Drive
Massapqua, NY 11758
The Target Group Fund Ltd.(4) 1,500,000 6.56%
c/o George Sandhu
The International Investment Group
17 State Street, 18th Floor
New York, New York 10004
Erno and Rachel Bodek 3,000,000 14.05%
c/o Victoria Sales Corporation
541 West 21st Street
New York, New York 10011
Caldwell Capital Corp. 1,500,000 6.56%
505 Northern Blvd.
Suite 308
Great Neck, New York 11021
Beneficial Owners as a group (5) 8,852,546 33.46%
--------------------------------
Notes to table of non-management beneficial shareholders
(1) There were 21,348,178 shares of common stock outstanding as of October
25, 2000.
(2) Except as described in footnote (5) below, the persons named in the
table have sole voting and investment power with respect to all shares
of common stock shown as beneficially owned by them, subject to the
information contained in this table and these notes.
(3) Mr. Pock is a former affiliate of CDKnet.com by virtue of his role as a
principal of Kelley Music & Entertainment Co. He is also the
father-in-law of Michael Jolly, a consultant for business development
to CDKnet.com and the Executive Vice President of the Entertainment
Group of ValueFlash.
(4) Represents shares issuable upon the conversion of 750,000 shares of
our Series A Preferred Stock to common stock at $.50 per share.
(5) As set forth in this table, there are 4 individuals or entities who are
not members of our management each of whom individually owns 5% or more
of our common stock. In addition to these individuals, there is a large
group of individuals who may constitute beneficial owners of our common
stock pursuant to the terms of a Stockholders Agreement dated May 7,
1998. Under the Stockholder's Agreement, its 35 signatories are
required to vote their respective shares of stock identified in the
Agreement as a class under certain circumstances. The names of the 35
signatories and their respective ownership interests are incorporated
by reference in Exhibit 99.1 of this document. As a result, the
-15-
<PAGE>
signatories as a group may constitute beneficial owners of our common
stock although only a few individually owns more than 5% of our common
stock. The voting and certain other provisions of the Stockholders
Agreement have been rescinded by 16 of the signatories to the
Shareholders Agreement. We believe it is the position of the
signatories to the Stockholders Agreement that they do not constitute a
"group" as such term is defined under Rule 13(d)(3) promulgated under
the Securities Exchange Act of 1934, as amended. The rescindment will
not become effective until all 35 shareholders execute the
Stockholders' Agreement. Further, under the terms of the Agreement, it
will terminate upon our filing an effective initial public offering
with the Commission. We consider our Form 10-SB, as amended, filed on
October 7, 1999 (File No. 0-27587) which became effective on December
7, 1999, to be an initial public offering. Therefore, we believe that
the Agreement terminated on its own terms on December 7, 1999.
B. ValueFlash.com Incorporated
------------------------------
The following are our non-management, beneficial owners of more than 5 percent
of the outstanding shares of the common stock, $.01 par value, of our
subsidiary, ValueFlash as of October 25, 2000:
Name and Address of Amount and Nature Percent of
Beneficial Stockholder of Beneficial Ownership Class (1)(2)
---------------------- ----------------------- ------------
AMRO, International, S.A. 450,000(3) 6.66%
c/o Ultra Finanz AG
Grossmuenstsplatz 6
Zurich, CH - 8022
Switzerland
Mabcrown, Inc. 750,000(4) 10.56%
c/o Ultra Finanz AG
Grossmuensterplatz 26
Zurich CH-8022, Switzerland
Incentive Management Co. 750,000(5) 10.56%
541 West 21st Street
New York, New York 10011
Beneficial Owners as a Group 1,950,000 26%
------------------------------------------
Notes to table of non-management beneficial shareholders
(1) There were 6,600,000 shares of ValueFlash common stock outstanding as
of October 25, 2000. CDKNET.com, Inc. owns 5,000,000 (75.76%) shares of
ValueFlash common stock in addition to 3,500,000 options to purchase
common stock at $1.50 per share, expiring January 28, 2005.
(2) The individuals or entities named in the table have sole voting and
investment power with respect to all shares of common stock shown as
beneficially owned by them, subject to the information contained in
this table and these notes.
(3) Includes 150,000 options to purchase ValueFlash common stock at $2.00,
expiring January 28, 2005.
(4) Includes 250,000 options to purchase ValueFlash common stock at $2.00,
expiring on November 22, 2000.
(5) Includes warrants to purchase up to 500,000 shares of ValueFlash common
stock at $2.00 per share, expiring on July 18, 2001.
-16-
<PAGE>
SECURITY OWNERSHIP OF MANAGEMENT
--------------------------------
A. CDKnet.com, Inc.
-------------------
The following table sets forth information with respect to the share ownership
of our common stock, $.001 par value, by our officers and directors, both
individually and as a group, and by the record and/or beneficial owners of more
than 5 percent of the outstanding amount of such stock as of October 25, 2000:
SHARES OF COMMON STOCK OWNED BENEFICIALLY AND OF
RECORD BY MANAGEMENT
Name and Address Amount and Nature Percent of
of Beneficial Owner of Beneficial Ownership Class(1)(2)
------------------- ----------------------- ----------
Steven A. Horowitz 2,520,496(3) 11.39%
c/o 250 West 57th Street
Suite 1101
New York, NY 10019
Andrew J. Schenker 113,306(4) *
c/o 250 West 57th Street
Suite 1101
New York, NY 10019
Anthony J. Bonomo 50,000(5) *
c/o 250 West 57th Street
Suite 1101
New York, NY 10019
Shai Bar-Lavi 1,500,000(6) 5.58%
c/o 250 West 57th Street
Suite 1101
New York, NY 10019
Shlomo Shur 500,000(11) 2.31%
c/o 250 West 57th Street
Suite 1101
New York, NY 10019
Israel Hersh 25,000(7) *
c/o 250 West 57th Street
Suite 1101
New York, NY 10019
Michael W. Jolly 216,667(8) 1.01%
c/o 250 West 57th Street
Suite 1101
New York, NY 10019
-17-
<PAGE>
Russell A. Kern 216,667(8) 1.01%
c/o 250 West 57th Street
Suite 1101
New York, NY 10019
Tom Ross 700,000(9) 3.20%
c/o 250 West 57th Street
Suite 1101
New York, NY 10019
Don Hegarty 25,000(12) *
c/o 250 West 57th Street
Suite 1101
New York, NY 10019
All officers and directors 5,867,136(10) 23.09%
as a group (10 persons)
---------------------------------------
Notes to table of beneficial shareholders
*Denotes less than 1%
(1) There were 21,348,178 shares of common stock outstanding as of
October 25, 2000. This table does not include options to purchase
10,000 shares of our common stock under our 1998 Equity Incentive Plan
held by Mr. Keith Fredericks, formerly our Sr. Vice President of
Software Development and Chief Technical Officer. Mr. Fredericks
resigned effective December 17, 1999.
(2) Except for the limitations set forth in the Stockholders Agreement
dated May 7, 1998, the persons named in the table have sole voting and
investment power with respect to all shares of common stock shown as
beneficially owned by them, subject to the information contained in
this table and these notes. See Exhibit 4.2.
(3) This table includes 28,571 two-year Warrants to purchase common stock.
Mr. Horowitz is our Chairman of the Board of Directors, Chief Executive
Officer, Chief Financial Officer and Secretary. This figure does not
include 150,000 warrants issued to Horowitz, Mencher, Klosowski &
Nestler P.C., a law firm formerly controlled by Mr. Horowitz, in
connection with a loan and loan extension. On January 11, 2000, Mr.
Horowitz was granted 750,000 options expiring on January 11, 2010 to
purchase shares of our common stock at $0.75 per share. This table also
includes those options.
(4) This table includes options to purchase 50,000 shares of our common
stock under the Plan. Mr. Schenker is one of our directors.
(5) This table includes options to purchase 50,000 shares of our common
stock under the Plan. Mr. Bonomo is one of our directors.
(6) This table includes warrants to purchase 750,000 shares and options to
purchase 500,000 shares of our common stock under the Plan. Mr.
Bar-Lavi is Chief Executive Officer of CDKnet, LLC and Chief Executive
Officer and chairman of ValueFlash.com Incorporated.
-18-
<PAGE>
(7) This table includes options to purchase 25,000 shares of our common
stock under the Plan.
(8) This table includes options to purchase 216,667 shares of our common
stock under the Plan. Mr. Kern is Executive Vice President and
Marketing Director of ValueFlash.com Incorporated and a Consultant for
Marketing to CDKnet, LLC. Mr. Jolly is Executive Vice President and
Sales Director of ValueFlash.com Incorporated and a Consultant for
Business Development to CDKnet, LLC.
(9) This table includes options to purchase 700,000 shares of our common
stock pursuant to his employment agreement. Mr. Ross is President of
the ValueFlash's Entertainment Group and a consultant for entertainment
to CDKnet, LLC.
(10) Includes all stock options to purchase 3,283,334 shares of common stock
and 778,571 Warrants owned by officers and directors.
(11) Includes 500,000 options to purchase common stock at $1.00 per share
under the Plan.
(12) Includes 25,000 options to purchase common stock at $1.00 per share
under the Plan.
B. ValueFlash.com Incorporated
------------------------------
The following are the holdings of the outstanding shares of the common stock,
$.01 par value, of our subsidiary, ValueFlash, by its officers and directors as
of October 25, 2000:
Percent of
Name and Address Amount and Nature Class
of Beneficial Owner of Beneficial Ownership Owned(1)(2)
------------------- ----------------------- -----------
Steven A. Horowitz 750,000(3) 10.20%
c/o 250 West 57th Street
Suite 1101
New York, NY 10019
Shai Bar-Lavi 1,300,500(4) 16.59%
c/o 250 West 57th Street
Suite 1101
New York, NY 10019
Shlomo Shur 812,500(5) 10.96%
c/o 250 West 57th Street
Suite 1101
New York, NY 10019
Robert Reeves 50,000(6) 0.752%
c/o 250 West 57th Street
Suite 1101
New York, NY 10019
Michael Jolly 75,000(7) 1.12%
c/o 250 West 57th Street
Suite 1101
New York, NY 10019
-19-
<PAGE>
Russell Kern 75,000(7) 1.12%
c/o 250 West 57th Street
Suite 1101
New York, NY 10019
Tom Ross 1,000,000(8) 13.16%
1480 San Reno Drive
Pacific Palisades, CA 90272
CDKNET.com, Inc. 8,500,000(9) 84.16%
c/o 250 West 57th Street
Suite 1101
New York, NY 10019
All Officers and Directors
as a group (5 persons) 14,287,500 91.22%
-----------------------------
Notes to table of beneficial shareholders
(1) There were 6,600,000 shares of ValueFlash common stock outstanding as
of October 25, 2000. This table includes CDKnet.com's ownership
interest in ValueFlash comprising 5,000,000 shares of ValueFlash common
stock and 3,500,000 options to purchase ValueFlash common stock at
$1.50 per share expiring on January 28, 2005. CDKnet.com's ownership
interest represents 75.76% of ValueFlash's issued and outstanding
stock.
(2) The persons named in the table have sole voting and investment power
with respect to all shares of common stock shown as beneficially owned
by them, subject to the information contained in this table and notes.
(3) Includes 750,000 options to purchase ValueFlash common stock at $1.50
per share expiring on January 27, 2005.
(4) Includes 1,300,500 options to purchase ValueFlash common stock at $1.50
per share expiring on January 27, 2005.
(5) Includes 812,500 options to purchase ValueFlash common stock at $1.50
per share expiring on January 27, 2005.
(6) Includes 50,000 options to purchase ValueFlash common stock at $1.50
per share expiring on April 9, 2005.
(7) Includes 75,000 options to purchase ValueFlash common stock at $1.35
per share expiring on January 27, 2005.
(8) Includes 1,000,000 options to purchase ValueFlash common stock at $1.35
per share expiring on January 27, 2005.
(9) Includes 3,500,000 options to purchase common stock at $1.50 per share
expiring on January 13, 2005.
2. INDEBTEDNESS OF MANAGEMENT
No member of our management is or has been indebted to us. No director or
executive officer is personally liable for repayment of amounts advanced any
financing received by us.
3. PROMOTERS
In June 1999, we entered into a Finders Agreement with Shai Bar-Lavi and
Frederick E. Smithline to introduce us one or more targets who may be interested
in certain business relationships with our company. For further discussion of
this agreement, see "Executive Compensation - Employment Agreements."
-20-
<PAGE>
ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
----------------------------------------------
We have incorporated by reference from our registration statement on Form SB-2,
dated August 1, 2000 (File No. 333-93277), the list of our transactions with
management and others. The following are additional transactions with such
persons, including securities that we have issued or sold without registering
them under the Securities Act of 1933 in reliance upon the exemptions from
registration provided by the Securities Act as follows:
o 100,000 options to purchase common stock of ValueFlash.com, Inc.
at an exercise price of $1.50 per share to Mary Benjamin
effective June 26, 2000, in accordance with ValueFlash.com's
Stock Option Plan. We issued options to the purchaser in reliance
upon the exemption provided by Regulation D and/or Section 4(2).
o 150,000 options to purchase common stock of ValueFlash.com, Inc.
at an exercise price of $2.00 per share to Marcia Irwin effective
February 14, 2000, in accordance with ValueFlash.com's Stock
Option Plan. We issued options to the purchaser in reliance upon
the exemption provided by Regulation D and/or Section 4(2).
o During the years ended June 30, 2000 and 1999 legal services of
$300,000 and $168,000, respectively, were provided by firms (the
"Firms") in which our CEO and principal stockholder is the
managing partner. Further, the Firm provided office space and
accounting services for which no fees were paid. During the year
ended June 30, 2000 and 1999 we recorded an expense of $47,000
for such services. In fiscal 1999, we entered into a $150,000
demand loan with the Firm at an interest rate of 11% and issued
150,000 stock warrants at $.66 exercisable through October 1,
2003. The detachable warrants with a fair value of $42,000 were
accounted for as additional interest cost with a credit to
paid-in capital. In fiscal 2000, the firm received $77,000 as
finder's fees for equity raised during fiscal 2000.
-21-
<PAGE>
SIGNATURES
In accordance with Section 13 or 15(d) of the Exchange Act, the
Registrant caused this Amendment No. 1 to the report on Form 10-KSB to be signed
on its behalf by the undersigned, thereunto duly authorized.
CDKnet.com, Inc.
----------------
(Registrant)
By: /s/ Steven A. Horowitz
----------------------------
Chairman, Chief Executive
Officer, Chief Financial
Officer and Secretary
Date: October 30, 2000
In accordance with the Exchange Act, this report has been signed below by the
following persons on behalf of the Registrant and in the capacities and on the
dates indicated.
<TABLE><CAPTION>
<S> <C> <C>
Chairman, Chief Executive
Officer, Chief Financial
/s/ Steven A. Horowitz Officer and Secretary October 30, 2000
--------------------------- ------------------------- ------------------
Steven A. Horowitz (Title) (Date)
/s/ Andrew J. Schenker Director October 30, 2000
--------------------------- ------------------------- ------------------
Andrew J. Schenker (Title) (Date)
/s/ Anthony J. Bonomo Director October 30, 2000
--------------------------- ------------------------- ------------------
Anthony J. Bonomo (Title) (Date)
</TABLE>
-22-
