SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
Filed by the Registrant [x]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[X] Preliminary Proxy Statement
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material pursuant to Rule 14a-11(c) or Rule 14a-12
COMTEC INTERNATIONAL, INC.
(Name of Registrant as Specified In Its Charter)
COMTEC INTERNATIONAL, INC.
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
[X] No Fee Required
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4)
and 0-11.
1) Title of each class of securities to which transaction
applies: ________________________________________________
2) Aggregate number of securities to which transaction
applies: ________________________________________________
3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11: N/A
___________________________________________________________
4) Proposed maximum aggregate value of transaction:
___________________________________________________________
5) Total Fee Paid: N/A
[ ] 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 off setting fee was paid previously. Identify the previous
filings by registration statement number, or the Form or
Schedule and the date of its filing.
1) Amount Previously Paid: ______________________________
2) Form, Schedule or Registration Statement No.: ________
3) Filing Party: ________________________________________
4) Date Filed: __________________________________________
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ComTec International, Inc.
9350 Arapahoe Road, Suite 320, Englewood, Colorado 80112
May 1, 2000
To the Stockholders of
ComTec International, Inc.
You are cordially invited to attend an Annual Meeting (hereinafter referred to
as the "Annual Meeting") of stockholders of ComTec International, Inc. (the
"Company") to be held at the office of the Company, located at 9350 East
Arapahoe Road, Suite 320, Englewood, Colorado on June 21, 2000, 1:00 P.M.,
Mountain Time, to elect a Board of Directors and to consider and vote upon the
matters set forth in the accompanying Notice of Annual Meeting of Stockholders.
In addition to election of Directors, shareholders will be asked to approve an
increase in the currently authorized .001 par value Common Stock of the Company.
Details and discussions concerning the proposals are provided in the Proxy
Statement included herewith and should be carefully reviewed.
Since it is important that your shares be represented at the meeting whether or
not you plan to attend in person, please indicate on the enclosed Proxy your
decisions about how you wish to vote and sign, date and return the Proxy
promptly in the envelope provided. If you find it possible to attend the meeting
and wish to vote in person, you may withdraw your Proxy at that time.
Your vote is important, regardless of the number of shares you own.
Sincerely,
- -------------------------------------------
James J. Krejci, President
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NOTICE OF ANNUAL MEETING
OF STOCKHOLDERS
To Be Held June 21, 2000
To the Stockholders of
ComTec International, Inc.
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of ComTec
International, Inc. (the "Company") will be held on June 21, 2000 at 1:00
o'clock in the afternoon, local time, at the offices of the Company at 9350 E.
Arapahoe Road, Suite 320, Englewood, Colorado 80112 for the following purposes;
all as more specifically set forth in the attached Proxy Statement:
1. To elect Directors for the following year.
2. To consider and vote upon the proposal to amend the articles of
incorporation to increase the authorized number of Common Shares to
200,000,000.
3. To transact such other business as may properly be brought before this
meeting.
Only holders of record of Common Stock of the Corporation as of the close of
business on May 1, 2000, are entitled to notice of or to vote at the meeting or
any adjournment thereof. The stock transfer books of the Corporation will not be
closed.
Stockholders are encouraged to attend the meeting in person. To ensure that your
shares will be represented, we urge you to vote, date, sign and mail the Proxy
Card in the envelope which is provided, whether or not you expect to be present
at the meeting. The prompt return of your Proxy Card will be appreciated. It
will also save the Company the expense of follow up contacts. The giving of such
Proxy will not affect your right to revoke such Proxy by appropriate written
notice or to vote in person should you later decide to attend the meeting.
By Order of the Board of Directors,
----------------------------
James Krejci, President
May 1, 2000
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ComTec International, Inc.
9350 East Arapahoe Road, Suite 320, Englewood, Colorado 80112
(303) 662-8069
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
To be held June 21, 2000
INTRODUCTION
The Proxy enclosed with this Proxy Statement will be first sent or given to
shareholders on or about May 1, 2000, in connection with the solicitation by the
Directors of ComTec International, Inc. (the "Company") of Proxies to be used at
an Annual Meeting of Shareholders to be held at the office of the Company at
9350 East Arapahoe Road, Suite 320, Englewood, Colorado 80112 (the "Annual
Meeting") on June 21, 2000.
Persons Making The Solicitation
The Proxy is solicited on behalf of the Directors of the Company. The
original solicitation will be by mail. Following the original solicitation,
management expects that certain individual shareholders will be further
solicited through telephonic or other oral communications from management.
Management may use specially engaged employees or paid solicitors for such
solicitation. Management intends to solicit Proxies which are held of record by
brokers, dealers, or voting trustees, or their nominees, and may pay the
reasonable expenses of such record holders for completing the mailing of
solicitation materials to persons for whom they hold the shares. All
solicitation expenses will be borne by the Company. As of the date of this
mailing, however, the Company has not made any contracts or arrangements for
such solicitation; hence it cannot identify any parties or estimate the cost of
such solicitation.
Terms of the Proxy
The enclosed Proxy indicates the matters to be acted upon at the Annual
Meeting and provides a box corresponding to each such matter. By appropriately
marking each box, a shareholder may specify whether to confer to or to withhold
from management the authority to vote the shares represented by the Proxy. The
Proxy also confers upon management discretionary voting authority with respect
to such other business as may properly come before the Annual Meeting.
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If the Proxy is executed properly and is received by management prior to
the Annual Meeting, the shares represented by the Proxy will be voted. Where a
shareholder specifies a choice with respect to the matter to be acted upon, the
shares will be voted in accordance with such specification. Any Proxy which is
executed in such a manner as not to withhold authority shall be deemed to confer
such authority.
A Proxy may be revoked at any time prior to its exercise by (1) so
notifying the Company in writing, (2) filing with the Company a duly executed
Proxy bearing a later date, or (3) voting in person at the Annual Meeting.
VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
Voting Securities
The securities entitled to vote at the Annual Meeting consist of all the
issued and outstanding shares of the Company's $.001 par value Common Stock (the
"Common Stock"). The close of business on May 1, 2000, has been fixed by the
Board of Directors of the Company as the record date. Only shareholders of
record as of the record date may vote at the Annual Meeting. As of the record
date, there were 44,876,191 shares of Common Stock issued and outstanding.
Voting Rights and Requirement
Each shareholder of record as of the record date will be entitled to one
vote for each share of Common Stock held as of the record date.
Quorum and Votes Required for Approval
The presence at the Annual Meeting of the holders of an amount of shares of
each class of stock entitled to vote at the meeting representing the right to
vote shares of Common Stock of not less than a majority of the number of shares
of Common Stock outstanding as of the record date will constitute a quorum for
transacting business. Directors will be elected by plurality vote. The
affirmative vote of the majority of outstanding shares is necessary to amend the
Articles of Incorporation. The affirmative vote of the majority of shares
represented at the meeting and entitled to vote thereat is necessary to approve
an increase in the currently authorized Common Stock of the Company.
Principal Security Holders
The following table sets forth information, as of the record date, with
respect to the beneficial ownership of the Company's Common Stock by each person
known by the Company to be the beneficial owner of more than five percent (5%)
of the outstanding Common Stock, and by Directors, nominees, and officers of the
Company, and by officers and Directors as a group.
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Name and Address Amount and Nature Percentage
of Beneficial Owner of Beneficial Ownership of Total Class
- --------------------------------------------------------------------------------
Lewis D. Rowe 4,317,924 (1) 9.6 %
PO Box 1561GT
Zephyr House, Mary Street
Grand Cayman, British West Indies
- -------------------------------
(1) Includes 2,158,962 warrants to purchase .001 par value Common Stock at
prices from $4.50 per share to $2.90 per share expiring between June 2000
and March 2001. The shares and warrants were issued in payment of fees to
Mr. Rowe between June 30, 1997 and March 23, 1998 with respect to certain
funding received by the Company from various entities not residents of
the U.S.A., as reported on the Company's Form 8K filed April 7, 1998.
SECURITY OWNERSHIP OF MANAGEMENT
The information is furnished as of May 1, 2000, as to the number of shares
of the Company's Common Stock, $.001 par value per share owned by each executive
officer and director of the Company and by all executive officers and Directors
as a group:
Name and Address of Amount and Nature Percentage of
Security Owner of Security Ownership (4)(5) Total Class
- --------------------------------------------------------------------------------
Gordon D. Dihle 218,676 (1) .5%
4881 South Amaro Drive
Evergreen, Colorado 80439
James Krejci 274,286 (2) .6%
1133 Race Street
Denver, Colorado 80206
Marc Maassen 64,000 (3) .1%
240 Hopi Place
Boulder, Colorado 80303
Total officers and Directors, 556,962 1.2%
(3 persons) as a group
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- --------------------------------
(1) Includes 14,070 shares owned by a professional corporation owned by Mr.
Dihle. Does not include stock options potentially equal to up to 7.5% of
the Company's Common Shares which Mr. Dihle has the potential to earn
pursuant to an employment agreement over a three year period ending January
1, 2002. Does not include a non-formalized option to purchase 1,000,000
shares of the Company's Common Shares which became effective after July 1,
1999.
(2) Does not include stock options potentially equal to up to 10% of the
Company's Common Shares which Mr. Krejci has the potential to earn pursuant
to an employee agreement over a three year period ending February 16, 2001.
Does not include a non-formalized option to purchase 1,300,000 shares of
the Company's Common Shares which became effective after July 1, 1999.
(3) Includes automatic stock options to purchase 28,000 shares of Common Stock
which accrued to Mr. Maassen as an outside Director under the Company's
1997 incentive stock option plan.
(4) Information with respect to beneficial ownership is based upon information
furnished by each shareholder of the Company contained in filings made with
the Securities and Exchange Commission. Unless otherwise indicated, the
beneficial owner has sole voting and investment power with respect to the
shares shown.
(5) Based on 44,876,191 shares outstanding. Where the persons listed on this
table have the right to obtain additional shares of Common Stock within 60
days from the date of this Proxy Statement, these additional shares are
deemed to be outstanding for the purpose of computing the percentage of
class owned by such persons, but are not deemed to be outstanding for the
purpose of computing the percentage of any other person.
Changes in Control
No arrangements are known to the Company, including any pledge by any
person of securities of the Company, the operation of which may, at a subsequent
date, result in further change in control of the Company.
MATTERS TO BE ACTED UPON
PROPOSAL 1: ELECTION OF DIRECTORS
The Directors of the Company are elected to serve until the next annual
shareholders' meeting or until their respective successors are elected and
qualify. Officers of the Company hold office until the meeting of the Board of
Directors immediately following the next annual
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shareholders' meeting or until removal by the Board of Directors. Interim
replacements for resigning Directors and officers are appointed by the Board of
Directors.
The names of the nominees for Directors and certain information about them
are set forth below:
Name Age Positions with the Company
- ---- --- --------------------------
James J. Krejci 58 Director, CEO and President
Gordon Dihle 45 Director, Secretary and Treasurer
Marc Maassen 49 Director
Business Experience
The following is a brief account of the experience, during the past five
years, of each Director and executive officers of the Company:
James J. Krejci: Chief Operations Officer of the Company and President and CEO
of AWN (February 1998); Chairman of the Board of Directors, CEO and President of
the Company (September 1998).
For the five years preceding Mr. Krejci's appointment as a Director of the
Company, Mr. Krejci was employed as follows:
September 1998 through present: CEO and President of ComTec
International, Inc. and AWN.
February 1998 through August 1998: COO of ComTec International, Inc.
and Chairman of the Board of Directors, CEO and President of AWN.
July 1996 through February 1998: CEO and President of Imagelink
Technologies, Inc., a firm involved in the development and distribution
of videoconference equipment.
May 1994 through February 1996: President - International Division
of International Gaming Technology, Inc., a firm involved in the
development and distribution of gaming equipment.
May 1985 through May 1994: President and/or officer of various
subsidiaries of Jones International, Inc., including Jones Intercable,
Inc., a 1934 Act Reporting Company. These firms were involved in
development and distribution of cable television systems as well
as activities ancillary and related to the cable television business.
Mr. Krejci earned a B.S. in chemical engineering from the University of
Wisconsin in 1964 and a MBA from the University of Wisconsin in 1970.
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Gordon D. Dihle: Secretary/Treasurer and Director of ComTec International, Inc.
and AWN (October 1997 to May 1998) and Chief Financial Officer, Treasurer,
Secretary and Director of ComTec International, Inc. (September 1998).
For the five years preceding Mr. Dihle's appointment as a Director of the
Company, Mr. Dihle was employed as follows:
January 1992 through September 1997: Dihle & Co., P.C., a
professional corporation wholly owned by Mr. Dihle which provides
legal, accounting and tax services.
April 1993 through present: Lostwood Farms, Ltd., a farm
corporation wholly owned by Mr. Dihle.
May 1998 through August 1998: Self employed as an attorney and
consultant, including work for ComTec International, Inc.
Mr. Dihle achieved a B.A. in Accounting and Business Administration in 1976
at Dickinson State University, Dickinson, North Dakota, and a J.D. in 1980 at
the University of North Dakota School of Law.
Marc Maassen: Outside Director of ComTec International, Inc. (October 1998).
For the five years preceding Mr. Maassen's appointment as a Director of the
Company, Mr. Maassen was employed as follows:
November 1999 through present: Employed by Netbeam, a wireless
phone and high-speed Internet provider as operations manager.
January 1998 through October: Self-employed communications and
computer industry consultant.
1991 through January 1998: Executive Vice PresidentICG
Communications, Inc. and executive positions with subsidiaries of
ICG Communications, Inc. (including Zycom Corporation and Fiber
Optic Technologies, Inc.) operating as a local exchange carrier
providing local, long distance, Internet and data services.
Mr. Maassen achieved a B.A. in Business Administration in 1974 at Colorado
State University, Fort Collins, Colorado.
The following table sets forth, as of the date of this Proxy Statement, the
names and ages of the Company's executive officers, including all positions and
offices held by each such person. These officers are elected to hold office for
one year or until their respective successors are duly elected and qualified:
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Name Age Positions with the Company Business Experience
- ---- --- -------------------------- -------------------
James J. Krejci 58 Director, CEO and President see above
Gordon Dihle 45 Director, Secretary and Treasurer see above
Marc Maassen 49 Director see above
Except as otherwise indicated below, no organization by which any officer
or Director previously has been employed is an affiliate, parent, or subsidiary
of the Company.
The Company does not have any standing audit, nominating, or compensation
committees of the Board of Directors.
Marc Maassen has been a Director since his appointment on September 30,
1998. Messrs. Dihle and Krejci were elected as Directors by a special meeting of
shareholders held August 26, 1998. Each Director participated in the Board of
Directors meeting that occurred during the period he was a Director. There have
been twelve board meetings since June 30, 1998, eight in the fiscal year ended
June 30, 1999, and four since June 30, 1999 to the date of this statement.
Compliance with Section 16(a) of the Exchange Act
During the fiscal year ended June 30, 1999, to the knowledge of the
Company, all of the Directors have filed on a timely basis the required Form 3
with the Securities and Exchange Commission as required by Section 16(a) of the
Securities Exchange Act of 1934. Supplemental Forms 4 and 5 as required by the
Securities and Exchange Commission as required by Section 16(a) of the
Securities Exchange Act of 1934 have been filed as of the date of this
statement.
Executive Compensation
The following table sets forth in summary form the compensation received
during each of the Company's last three completed fiscal years by the Chief
Executive Officer of the Company and by each other executive officer of the
Company whose total salary and bonus exceeded $100,000 in the Company's fiscal
year ended June 30, 1999:
No employee of the Company other than James J. Krejci, its CEO, earned in
excess of $100,000 during the fiscal years ended June 30, 1998 and June 30,
1999.
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SUMMARY COMPENSATION TABLE
ANNUAL COMPENSATION LONG TERM COMPENSATION
------------------- ----------------------
Name and Position Year Salary Bonus Other SAR Options LTIP Other
- ------------------- ------ -------- ------- ------- ----- ------- ---- -------
James J. Krejci 1999 $117,00 None None None None None None
CEO and President 1998 $150,800 None None None None None None
- ------------------- ------ -------- ------- ------- ----- ------- ---- -------
Option/SAR Grant Table
During the fiscal years ended June 30, 1998 and 1999, no effective grants
of stock options or freestanding SAR's were made by the Company.
The Company does not pay non-officer Directors for their services as such,
with the exception that Marc Maassen has received a total of 72,000 shares of
the Company's .001 par value Common Stock as compensation for acting as outside
Director since his appointment on September 30, 1998, nor does it pay any
Director's fees for attendance at meetings. Directors are reimbursed for any
expenses incurred by them in their performance as Directors.
The Company has no long-term incentive plans.
There are no arrangements pursuant to which Directors of the Company are
compensated in their capacities as such except that the outside Director, Marc
Maassen, has been paid compensation in the form of unregistered Common Stock
totaling 72,000 shares (36,000 shares each year) since his appointment in
September 1998
Employee Agreements
A former officer, Donald G. Mack, was acting as President and CEO of the
Company under a three year contract ending in May 1998. Mr. Mack resigned as
President and CEO of the Company and as an officer and Director of each of the
Company's subsidiaries on June 23, 1998. Mr. Mack's resignation letter stated
that his resignation was not a waiver of any rights or claims to any
compensation, stock, options, bonuses or accrued amounts of cash, loans or
guarantees made on behalf of the Company under the terms and conditions of his
employment contract and an alleged addendum thereto. Mr. Mack's resignation
letter did not request that any disagreement be reported or disclosed in the
Company's regulatory filings. Prior to a special meeting of shareholders held
August 26, 1998, one of the purposes of which meeting was to remove Mr. Mack as
a Director, by a letter dated August 21, 1998, Donald G. Mack tendered his
resignation as a Director of the Company and as an officer and Director of any
of its subsidiaries. Previously, on June 23, 1998, Mr. Mack had tendered his
resignation as an officer of the Company and as an officer and Director of any
of its subsidiaries. Mr. Mack's resignation letter stated that his resignation
was not a waiver of any rights or claims to any compensation, stock, options,
bonuses or accrued amounts of cash, loans or guarantees made on behalf of the
Company under the terms and conditions of his employment contract. Mr. Mack's
resignation letter did not request that any disagreement be reported or
disclosed in the Company's regulatory filings. Mr. Mack was
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officially removed as a Director of the Company at the special meeting of
shareholders held August 26, 1998. Mr. Mack has subsequently filed litigation
against the Company related to alleged compensation entitlements and the Company
has filed extensive counterclaims against Mr. Mack. SEE ITEM 3 of Form 10KSB for
the period ended June 30, 1999 - LEGAL PROCEEDINGS - LITIGATION WITH FORMER
OFFICER AND DIRECTOR
On February 16, 1998, the Company entered into a letter agreement with
James Krejci, which remains to be formalized, by which Mr. Krejci became
employed as Chief Operations Officer of the Company and President and CEO of
AWN. The letter agreement calls for a three year employment agreement with the
opportunity for Mr. Krejci to obtain, through Common Stock option agreements, up
to ten percent (10%) of the outstanding Common Stock of the Company over a three
year period. The preliminary agreement calls for Mr. Krejci to receive stock
options vesting in three equal annual increments to equal a total of 10% of the
Company's outstanding Common Shares over a three year period. The strike price
of all of the potential options, as modified (repriced) by Board of Director
action on October 7, 1998, is $.056 per share, representing 80% of the bid price
of the Company's Common Stock on September 2, 1998 (closing bid price $.07), Mr.
Krejci's actual appointment date as President and CEO of the Company. On May 6,
1999, as additional employee incentive, the non interested members of the Board
of Directors passed a resolution granting Mr. Krejci a four year option, to
become effective after July 1, 1999, to purchase 1,300,000 shares of the
Company's .001 par value Common Stock at a strike price of $.05 per share, based
upon a calculation of 111% of the .045 bid price of the stock on May 6, 1999. No
options have actually been issued pursuant to agreements with Mr. Krejci.
Effective January 1, 1999, the Company entered into a letter agreement with
Gordon Dihle, which remains to be formalized, by which Mr. Dihle became employed
as Chief Financial Officer of the Company. The letter agreement calls for a
three year employment agreement with the opportunity for Mr. Dihle to obtain,
through Common Stock option agreements, up to seven and one half percent (7.5%)
of the outstanding Common Stock of the Company over a three year period. The
preliminary agreement calls for Mr. Dihle to receive stock options vesting in
annual increments of 2.5% to equal a total of 7.5% of the Company's outstanding
Common Shares over a three year period. The strike price of all of the options
is $.056 per share, representing 80% of the bid price of the Company's Common
Stock on September 2, 1998 (closing bid price $.07), Mr. Dihle's date of
appointment as Chief Financial Officer of the Company. On May 6, 1999, as
additional employee incentive, the non interested members of the Board of
Directors passed a resolution granting Mr. Dihle a four year option, to become
effective after July 1, 1999, to purchase 1,000,000 shares of the Company's .001
par value Common Stock at a strike price of $.05 per share, based upon a
calculation of 111% of the .045 bid price of the stock on May 6, 1999. No
options have actually been issued pursuant to agreements with Mr. Dihle.
Report on Repricing of Options/SAR's.
No stock options or freestanding SAR's were issued or outstanding.
Accordingly, and during the fiscal year ended June 30, 1999, no stock options or
freestanding SAR's were repriced.
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With respect to the informal letter agreement between Mr. Krejci, the
Company's CEO, and the Company, in reference to the spirit of the agreement, the
strike price of the potential options available to be earned by Mr. Krejci was
modified (repriced) by Board of Director action on October 7, 1998, to $.056 per
share, representing 80% of the bid price of the Company's Common Stock on
September 2, 1998 (closing bid price $.07), Mr. Krejci's actual appointment date
as President and CEO of the Company. No options have actually been issued
pursuant to agreements with Mr. Krejci.
Certain Transactions
In April 1997, a former officer of the Company, Donald G. Mack, while an
officer/director/shareholder of the Company, collateralized the purchase of an
automobile in a limited liability company, which is affiliated with Donald G.
Mack. A certificate of deposit of the Company in the amount of $78,600 was held
by a financial institution as collateral to the automobile purchased by the
related party. The collateral was reduced by approximately $10,000 during the
subsequent period. The certificate of deposit is restricted and is included in
cash and equivalents. The Company subsequently obtained release of the
collateralized certificate of deposit from the financial institution in December
1998. The Company has filed extensive claims against Mr. Mack.
On February 16, 1998, the Company entered into a letter agreement (as
modified) with the James Krejci, which remains to be formalized, by which Mr.
Krejci initially became employed as Chief Operations Officer of the Company and
President and CEO of AWN. The letter agreement calls for a three year employment
agreement with the opportunity for Mr. Krejci to obtain, through Common Stock
option agreements, up to ten percent (10%) of the outstanding Common Stock of
the Company over a three year period. See "Employment Agreements" above.
Effective January 1, 1999, the Company entered into a letter agreement with
Gordon Dihle, which remains to be formalized, by which Gordon Dihle became
employed as Chief Financial Officer of the Company. The letter agreement calls
for a three year employment agreement with the opportunity for Mr. Dihle to
obtain, through Common Stock option agreements, up to seven and one half percent
(7.5%) of the outstanding Common Stock of the Company over a three year period.
See "Employment Agreements" above.
Except for the foregoing and during the fiscal year ended June 30, 1999, no
officer, Director or relative or spouse of the foregoing persons or any relative
of such person who has the same home as such person, or is a Director or other
officer of any parent or subsidiary of the Company or any shareholder known by
the Company to own of record or beneficially more than five (5%) percent of the
Company's Common Stock, had a direct or indirect material interest in any
transaction or presently proposed transaction to which the Company or any of its
parents or subsidiaries was or is a party.
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PROPOSAL 2: AMENDMENT OF ARTICLES OF INCORPORATION
The Board of Directors proposes to amend the Company's Articles of
Incorporation to increase the number of authorized shares of Common Stock, par
value $.001 per share, from 100,000,000 to 200,000,000. The Board of Directors
believes that approval of the increase in the Company's authorized Common Stock
will assist the Company by enhancing its ability to raise capital in public or
private offerings to be used for, among other things, acquisition and equity
financing purposes. As of May 1, 2000, there were approximately 44,876,191
shares of Common Stock outstanding.
The Company proposes to amend of its Articles of Incorporation to increase
its authorized Common Stock from 100,000,00 to 200,000,000 shares.
Article (A) of the Articles of Incorporation is hereby proposed to be
amended to read in its entirety as follows:
(A) Authorized Shares. The aggregate number of shares which the
corporation shall have the authority to issue is 210,000,000
shares. Two Hundred Million (200,000,000) shares shall be
designated "Common Stock," and shall have a par value of $.001
per share. Ten Million (10,000,000) shares shall be designated
"Preferred Stock," and shall have a par value of $.001 per share,
and shall be issued for such consideration, expressed in dollars,
as the Board of Directors may, from time to time, determine.
This Amendment would increase the number of Common Shares available for
issuance by the Company by an additional 100,000,000 shares.
The proposed increase in the amount of authorized Common Stock is desirable
for, among other things, to enable the Company to potentially directly issue
stock in potential merger or acquisition transactions or issue stock in future
offerings for the purpose of raising equity capital. In addition to satisfying
this immediate need, the increase in authorized Common Stock will permit the
Company to maintain some flexibility in addressing its future capital needs, and
will allow for future growth of the Company through new product acquisition and
possible merger/acquisition situations.
If the proposed amendment is approved, the additional shares of Common
Stock of the Company shall entitle the holders thereof to identical rights,
privileges and duties as present holders of the Company's Common Stock. The
shares of Common Stock do not have cumulative voting rights. No holder of any
shares of the Company has or shall have any preemptive rights with respect to
the issuance of Common Stock by the Company.
If the proposed amendment is approved, the Company may seek to obtain
additional capital for general corporate purposes by one or more public or
private offerings of its Common and/or
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Preferred Stock or directly issue shares in a merger or acquisition transaction.
It is not possible at this time to describe the specifics of any future offering
or other issuance of Common or Preferred Stock since the Company cannot make
anything beyond tentative plans until after the issues presented at the Annual
Meeting are resolved.
The Board of Directors does not intend to seek shareholder approval prior
to the issuance of any additional shares of stock. Under the Business
Corporation Law of the State of New Mexico, the Company is not required to
obtain approval of its shareholders in order to issue the authorized stock.
If the proposed amendment is adopted, the Company could, but does not
intend at this time, to issue the Common Stock to a shareholder or shareholders
friendly to management thereby making a merger, tender offer, change of control,
or proxy contest more difficult even though such transactions may be favorable
to the interests of shareholders. Management is not aware of any attempt by any
person or group to obtain control of the Company. The Company's Articles of
Incorporation and By-Laws do not contain any provisions having an anti-takeover
effect and management does not presently intend this amendment to be a part of a
plan to adopt a series of anti-takeover measures in future Proxy solicitations.
As stated above, the reason for the amendment is to create an adequate reserve
of Common Stock to be used for, among other things, acquisitions and financing
purposes.
In addition to the possible issuance of the additional authorized Common
Stock to interests friendly to management, the issuance of additional Common
Stock would have a dilutive effect on the shareholders' voting rights and may
have a dilutive effect on other shareholder rights. The advantage of the
amendment is that, when adopted, the Company will have an adequate reserve of
equity securities immediately available to it in order to enable it to take
advantage of acquisition and equity financing opportunities as the arise. The
expense and delay of having to obtain shareholder approval to issue equity
securities for specific transactions may in effect cause the Company to lose
such opportunities.
The Board of Directors approved this amendment to the Articles of
Incorporation by a unanimous vote. Adoption of this amendment requires the
affirmative vote of the holders of a majority of the outstanding shares of the
Common Stock. If it is adopted, the amendment will become effective as soon
after the meeting as practicable upon the filing of the Certificate of Amendment
to the Articles of Incorporation by the Secretary of State of New Mexico.
Recommendation and Vote Required
The Board recommends that the shareholders vote "FOR" this proposal to
adopt the Articles of Amendment. The affirmative vote of a majority of the
outstanding shares entitled to vote is required for approval. See "VOTING
SECURITIES AND PRINCIPAL HOLDERS THEREOF" above.
15
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RELATIONSHIP WITH INDEPENDENT ACCOUNTANTS
Grabau & Company, PC served as the independent accountants for the Company
for the year ended June 30, 1999. Management of the Company intends to select
such firm as the Company's independent accountant for the fiscal year ending
June 30, 2000.
A representative of Grabau & Company, PC is not expected to be present at
the Annual Meeting.
OTHER MATTERS
Except for the matters referred to in the accompanying Notice of Annual
Meeting, management does not intend to present any matter for action at the
Annual Meeting and knows of no matter to be presented that is a proper subject
for action by the shareholders at the meeting. However, if any other matters
should properly come before the meeting, it is intended that votes will be cast
pursuant to the authority granted by the enclosed Proxy in accordance with the
best judgment of the person or persons acting under the Proxy.
ANNUAL REPORT
The Company's Annual Report on Form 10-KSB for the year ended June 30,
1999, including the financial statements, as filed with the Securities Exchange
Commission under the Securities Act of 1934, constitutes the annual report to
shareholders and is being mailed with this Proxy Statement and is incorporated
in this Proxy Statement by reference.
Upon written request and payment of a reasonable fee to cover the Company's
expenses, the Company will furnish any person who is a shareholder of the
Company as of May 1, 2000, a copy of any Exhibit to the Form 10-KSB described
above and the latest Form 10QSB as filed with the Securities Exchange
Commission. Additionally, upon written request, the Company will furnish a copy
of Form 10QSB as filed with the Securities Exchange Commission for the periods
ended June 30, 1997 and 1998. Any such written request may be addressed to the
Corporate Secretary, ComTec International, Inc., 9350 East Arapahoe Road, Suite
320, Englewood, Colorado 80112. The written request shall include a good faith
representation that, as of May 1, 2000, the person making the request was the
beneficial owner of Common Stock of the Company entitled to vote at the Annual
Meeting.
SHAREHOLDER PROPOSALS
Any shareholder proposing to have any appropriate matter brought before the
next Annual Meeting of Shareholders must submit such proposal in accordance with
the proxy rules of the Securities and Exchange Commission. Such proposals should
be sent to the Corporate Secretary,
16
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ComTec International, Inc., 9350 East Arapahoe Road, Suite 320, Englewood,
Colorado 80112 for receipt no later than July 31, 2000.
By order of the Board of Directors,
James J. Krejci, President
Englewood, Colorado
May 1, 2000
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF
COMTEC INTERNATIONAL, INC. (the "Company")
17
<PAGE>
SHAREHOLDER PROXY
ComTec International, Inc.
Annual Meeting of Shareholders
June 21, 2000.
James J. Krejci is hereby authorized to represent and to vote the shares of the
undersigned in the Company at an annual Meeting (hereafter referred to as (the
"Annual Meeting") of Stockholders to be held on June 21, 2000, and at any
adjournment as if the undersigned were present and voting at the meeting. NOTE:
Cumulative voting for Directors is not allowed.
Item 1. Election of Directors - until the next annual meeting.
FOR ELECTION OF NOMINEES _______ WITHHOLD AUTHORITY ______
To elect all of the nominees for Directors of the Company listed below:
Term of office Elected
Name Age with the Company Position Sought
---- --- ---------------- ---------------
James J. Krejci 58 August 1998 to present Director
Gordon Dihle 45 August 1998 to present Director
Marc Maassen 49 September 1998 to present Outside Director
(INSTRUCTION: To withhold authority to vote for any individual nominee(s),
write that nominee's name below)
--------------------------------
--------------------------------
--------------------------------
Item 2. FOR [ ] AGAINST [ ] ABSTAIN [ ] Proposal to amend the articles of
incorporation to increase the authorized number of Common Shares from
100,000,000 to 200,000,000.
Item 3. In their discretion, on any other business that may properly come before
the meeting.
FOR [ ] WITHHOLD AUTHORITY [ ]
The shares represented hereby will be voted. With respect to Items 1 and 2
above, the shares will be voted in accordance with the specifications made and
where no specifications are given, said proxies will vote FOR all three
Directors and FOR all the proposals.
Please sign and date below and return to, Corporate Secretary, ComTec
International, Inc., 9350 East Arapahoe Road, Suite 320, Englewood, Colorado
80112.
Receipt is acknowledged of (1) Notice of Annual Meeting, (2) Proxy Statement for
the Annual Meeting and (3) Form 10KSB for year ended June 30, 1999.
Dated ___________________, 2000
---------------------------------------
Print Shareholder Name(s)
exactly as listed on your certificate
or your brokerage account
---------------------------------------
Signature
---------------------------------------
Signature
Joint Owners should each sign.
Attorneys-in-fact, executors,
administrators, trustees, guardians or
corporation officers, please give full
title and name of entity represented
by the Proxy.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.
