SECURITIES EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 14f
NOTICE OF ARRANGEMENT REGARDING ELECTION OF DIRECTORS
WITHOUT A MEETING
Pursuant to Section 14(f) of the Securities Exchange Act of 1934
Date of Designation: 10 days after the date of filing of this
Notice and transmittal thereof to the Registrant's shareholders.
Commission File number: 0-114244
WATCHOUT! INC.
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(Exact name of registrant as specified in its charter)
Utah 84-0959153
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State or Other Jurisdiction (I.R.S. Employer
of incorporation or organization) Identification
Number)
20283 State Road 7 - Suite 400, Boca Raton, FL 33428
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(Address of principal Executive Offices Zip Code)
Registrant's telephone number, including area code:(561) 482-9421
VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
Voting Shares Outstanding
As of September 1, 2000, there were 49,555,626 voting shares of the Registrant's
$.001 par value common stock outstanding, its only class of voting securities,
each share entitling the holder thereof to one vote.
Security Ownership of Certain Beneficial Owners and Management
As of September 1, 2000, the following persons were known by the Registrant to
own or control beneficially more than five percent of its outstanding $.001 par
value common stock, its only class of voting stock. The table below also sets
forth the total number of
<PAGE>
shares of the Registrant's outstanding voting stock owned by its officers and
directors and by persons designated to become directors:
<TABLE>
<CAPTION>
Number of Percent of Percent of
Shares Owned Class Before Class After
Name and Address of Beneficially Purchase Purchase
Beneficial Owner and of Record Transaction Transaction
--------------------------------------------- -------------------------------- ----------------------- -----------------------
<S> <C> <C> <C> <C>
Kevin Waltzer 4,608,922 (1) 18.8% 9.3%
--------------------------------------------- -------------------------------- ----------------------- -----------------------
Terry Reed 344,000 (1)(2) 1.4% 0.7%
--------------------------------------------- -------------------------------- ----------------------- -----------------------
Melvin Broussard 1,200,000 (1) 4.8% 2.4%
--------------------------------------------- -------------------------------- ----------------------- -----------------------
Todd Violette 25,100,000 (2)(3) 0% 50.6%
--------------------------------------------- -------------------------------- ----------------------- -----------------------
Cavalcade of Sports Networks, 25,100,000 0% 50.6%
Inc.
--------------------------------------------- -------------------------------- ----------------------- -----------------------
Shawn Clarke 0 (2) 0% 0%
--------------------------------------------- -------------------------------- ----------------------- -----------------------
Mark Johnson & Associates 2,500,000 (4) 10.2% 5.0%
============================================= ================================ ======================= =======================
Richard Epstein 2,000,000 8.1% 4.0%
============================================= ================================ ======================= =======================
Previous board of directors and 6,148,922 25.9% 12.4%
officers as a group
============================================= ================================ ======================= =======================
Proposed Board of Directors and 30,048,922 20.1%(5) 60.5%
officers as a group
============================================= ================================ ======================= =======================
</TABLE>
(1) Director of the Company prior to purchase transaction.
(2) Designated director following purchase transaction.
(3) Includes 25,100,000 shares owned by Cavalcade. Mr. Violette is a
principal shareholder and control person of Cavalcade.
(4) The Company has placed an administrative stop order on these shares.
The registered holder thereof has agreed to surrender said shares to
the Company but has failed to deliver the same.
(5) Does not include 25,100,000 shares issued to Cavalcade and
attributable to Mr. Todd Violette, a director of the Registrant for
purposes of this calculation.
Director designee
Changes in Control of Registrant
On August 31, 2000, Cavalcade of Sports Networks, Inc., a
corporation formed under the laws of the State of Nevada
("Cavalcade") entered into an Stock Exchange Agreement (the
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<PAGE>
"Agreement") with the Registrant to sell Cormax Business Solutions,
Ltd. ("Cormax"), its wholly owned subsidiary organized under the laws
of the Province of Alberta Canada, to the Registrant. Upon the closing
of the Agreement as of September 1, 2000, Cavalcade obtained control of
the Registrant. Upon the passage of ten days following the filing of
this Form and the mailing of this Notice to shareholders of the
Registrant, one out of the three current members of the Registrant's
Board of Directors will resign, and it is intended that Cavalcade will
elect Shawn Clarke as a director of Registrant.
DIRECTORS AND EXECUTIVE OFFICERS
The current Directors and Executive officers of Registrant
are:
Todd Violette Director President
Kevin S. Waltzer Director
Terry Reed Director
Deborah K. Hausman Secretary
Legal Proceedings
No current director or future director, officer, or affiliate of the
Registrant, five percent holder of any class of voting securities of the
Registrant, nor any associate of the above, is a party adverse to the Registrant
or has a material interest adverse to the Registrant, except that Todd Violette
is an officer, director and majority shareholder of Cavalcade which has a
material interest and owns 25,100,000 shares of the Registrant's common shares.
MANAGEMENT
Identification of Directors to be appointed without shareholder
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meeting
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Upon the passage of ten days after the filing of this Form and mailing
of this Notice to Shareholders, one of the present Directors of the Company,
Kevin S. Waltzer, will resign and it is anticipated that Shawn Clarke will be
elected to replace him.
The persons who will be serving as directors of the Registrant, and
their ages, are as follows:
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Name Age
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Todd Violette 31
Shawn Clarke 33
Terry Reed 52
Pursuant to the Share Acquisition Agreement, Todd Violette has been
appointed as President and Chairman of the Board of Directors of the Registrant.
Business Experience
-------------------
The following is a brief account of the business experience during at
least the past five years of the persons designated to be new directors of the
Registrant, indicating the principal occupation and employment during that
period by each, and the name and principal business of the organizations by
which they were employed.
No appointee for a director position has been subject of any civil
regulatory proceeding or any criminal proceeding in the past five years.
Todd Violette, President and Proposed Director
Mr. Violette graduated in 1992 from the University of Maryland,
College Park, with a Bachelor of Arts degree in Behavioral and Social
Sciences.
He has been chairman of the Board of Directors and president of
Cavalcade since February of 2000. From October of 1997 until February, 2000, Mr.
Violette was president of Centurion Financial Corporation, a public relations
firm located in Ellicott City, MD. From May of 1997 to October of 1997, Mr.
Violette was a stock broker with the firm of West America Securities, located in
Thousand Oaks, CA. From September of 1996 to May of 1997, Mr. Violette was a
stock broker with the firm of MA Gillespie Securities, located in Encino, CA.
From September of 1995 to September of 1996, Mr. Violette was a loan officer
with Atlantic Coast Mortgage, located in Bethesda, MD.
Shawn Clarke, Proposed Director
Shawn Clarke graduated from the University of Lethbridge in 1988 with a
Bachelor of Sciences degree in computer science.
From September 1995 to January 1996, Mr. Clarke was employed by
Arendeeco, Inc., a software development and consulting company located in
Calgary, Canada, as a manager of consulting services. From January 1996 to April
1996, Mr. Clarke was employed by RHI
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<PAGE>
Consulting, a division of Robert Half International, a computer consulting
company located in Calgary, Canada, as a division director. From April 1996 to
August 1996, Mr. Clarke served as president of WhereAmI Inc., an internet
start-up company located in Calgary, Canada. From August 1996 to July 1997, Mr.
Clarke served as consulting services manager for Accuware, Inc. of Calgary,
Canada. From July 1997 to April 2000, Mr. Clarke served as manager of internet
technologies for Neles Automation, a software development and systems
integration company located in Calgary, Canada. From April 2000 to date, Mr.
Clarke has serves as vice president of Cormax.
It is anticipated that Mr. Clarke will be appointed a vice president
of the Registrant.
Transactions with Management and Others
---------------------------------------
Except as set forth in the table below, there were no transactions or
series of transactions during the Registrant's last fiscal year or the current
fiscal year, or any currently proposed transactions or series of transactions of
the remainder of the fiscal year, in which the amount involved exceeds $60,000
and in which to the knowledge of the Registrant, any director, executive
officer, nominee, future director, five percent shareholder, or any member of
the immediate family of the foregoing persons, have or will have a direct or
indirect material interest. In addition, none of the foregoing persons have been
indebted to the Registrant during such periods in an amount exceeding $60,000.
Committees of the Board of Directors
The Registrant has no standing audit, nominating and compensation
committees of the Board of Directors, or committees performing similar
functions, nor does it propose to have the same following the appointment of the
new directors.
Meetings of the Board of Directors
There were irregular meetings of the Registrant's Board of Directors
during the current fiscal year and during the past fiscal year, as necessary.
COMPENSATION OF DIRECTORS AND EXECUTIVE OFFICERS
Except as set forth below, during the Registrant's past fiscal year,
and the current fiscal year, no executive officer of the Registrant received
cash compensation other than reimbursement for expenses incurred on behalf of
the Registrant, no compensation was paid pursuant to a plan, no other type of
compensation was paid, no director received compensation, and no termination of
employment and change of control arrangements were implemented.
<TABLE>
<CAPTION>
Name and
principal Annual Compensation Long Term Compensation
position Year Salary Bonus Other Stock SAR's LTIP Other
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Kevin Waltzer 1999 $ 0.00 $ 0.00 $ 0.00 $ 0.00 $ 0.00 $0.00 $ 0.00
Director 2000 $90,000.00 $ 0.00 $ 0.00 $ 0.00 $ 0.00 $0.00 $ 0.00
Mel Broussard 1999 $ 0.00 $ 0.00 $ 0.00 $ 0.00 $ 0.00 $0.00 $ 0.00
Director/Pres 2000 $40,000.00 $ 0.00 $ 0.00 $ 960,000.00 $ 0.00 $0.00 $ 0.00
Terry Reed 1999 $ 0.00 $ 0.00 $ 0.00 $ 0.00 $ 0.00 $0.00 $ 0.00
Director 2000 $ 0.00 $ 0.00 $ 0.00 $ 74,800.00 $ 0.00 $0.00 $ 0.00
Deborah Hausman 1999 $ 0.00 $ 0.00 $ 0.00 $ 0.00 $ 0.00 $0.00 $ 0.00
Secretary 2000 $25,000.00 $ 0.00 $ 0.00 $ 27,900.00 $ 0.00 $0.00 $ 0.00
</TABLE>
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<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, the Registrant has duly caused this Notice to be signed on its behalf
by the undersigned, thereunto duly authorized.
Dated: September 29, 2000 WATCHOUT! INC.
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by:/s/ Todd Violette
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Todd Violette, President
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