SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement [ ] Confidential, For Use of the
[X] Definitive Proxy Statement Commission Only (as permitted
[ ] Definitive Additional Materials by Rule 14a-6(e)(2))
[ ] Soliciting Material Pursuant to
Rule 14a-11(c) or Rule 14a-12
ELLIGENT CONSULTING GROUP, INC.
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(Name of Registrant as Specified In Its Charter)
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(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
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1) Title of each class of securities to which transaction applies:
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2) Aggregate number of securities to which transaction applies:
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3) Per unit price or other underlying value of transaction computed pursuant
to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is
calculated and state how it was determined):
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4) Proposed maximum aggregate value of transaction:
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5) Total fee paid:
[ ] Fee paid previously with preliminary materials:
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration
statement number, or the form or schedule and the date of its filing.
1) Amount previously paid:
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2) Form, Schedule or Registration Statement No.:
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3) Filing Party:
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4) Date Filed:
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<PAGE>
CONTENTS
NOTICE OF ANNUAL MEETING OF SHARE OWNERS...................................... 1
GENERAL INFORMATION ABOUT VOTING.............................................. 2
ELECTION OF DIRECTORS......................................................... 4
APPROVAL OF AUDITORS.......................................................... 5
APPROVAL OF 1998 STOCK OPTION PLAN............................................ 6
INFORMATION ABOUT THE BOARD AND ITS COMMITTEES................................ 8
EXECUTIVE COMPENSATION........................................................10
OWNERSHIP OF OUR COMMON STOCK.................................................11
OTHER MATTERS.................................................................11
ANNUAL REPORT.................................................................12
SHARE OWNERS' PROPOSALS FOR THE
2000 ANNUAL MEETING OF SHARE OWNERS.........................................12
<PAGE>
PROXY STATEMENT
Elligent Consulting Group, Inc.
Page 1
NOTICE OF ANNUAL MEETING OF SHARE OWNERS
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9:00 a.m. (EDT), June 10, 1999
Le Parker Meridien Hotel
110 West 57th Street
New York, New York 10019
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May 18, 1999
To the Share Owners:
Elligent Consulting Group, Inc.'s 1999 Annual Meeting of Share Owners will be
held in the Salon Concorde on the third floor of Le Parker Meridien Hotel at 110
West 57th Street, New York, New York, on Thursday, June 10, 1999, at 10:00 a.m.
(EDT), to address all matters that may properly come before the meeting.
Following a report on Elligent's business operations, the share owners will vote
on:
(1) Election of six Directors;
(2) Approval of the appointment of Independent Auditors for 1999;
(3) Approval of the 1998 Stock Option Plan; and
(4) Any other matters that may properly come before the meeting or any
adjournments.
Share owners of record at the close of business on April 30, 1999, will be
entitled to vote at the meeting and any adjournments. The list of share owners
entitled to vote at this meeting is available at the offices of Elligent
Consulting Group, Inc., 152 West 57th Street, New York, New York 10019, for
examination by any share owner.
WHETHER OR NOT YOU EXPECT TO BE PRESENT AT THIS MEETING, PLEASE SIGN, DATE AND
RETURN THE ENCLOSED PROXY, WHICH IS SOLICITED BY AND ON BEHALF OF THE BOARD OF
DIRECTORS. THE GIVING OF THIS PROXY WILL NOT AFFECT YOUR RIGHT TO REVOKE IT OR
TO VOTE IN PERSON SHOULD YOU DECIDE TO ATTEND THE MEETING.
Edwin T. Brondo
Secretary
<PAGE>
PROXY STATEMENT
Elligent Consulting Group, Inc.
Page 2
Your vote is very important. For this reason, the Board of Directors is
requesting that you allow your Common Stock to be represented at the 1999 Annual
Meeting of Share Owners, and any adjournments of that meeting, by the persons
who are named on the enclosed proxy card to you in connection with this request
on May 18, 1999. The Meeting is scheduled to occur on June 10, 1999. "We,"
"our," "Elligent" and the "Corporation" refer to Elligent Consulting Group, Inc.
GENERAL INFORMATION ABOUT VOTING
WHO CAN VOTE?
If you are a holder of our Common Stock, par value $0.001 per share, on our
records at the close of business on April 30, 1999, (the "Record Date" for the
Meeting) you are entitled to vote at the Meeting. On the Record Date, we had
14,857,226 shares of our Common Stock issued and outstanding. Each issued and
outstanding share of Common Stock will be entitled to one vote on each matter to
be voted on at the Meeting and can be voted only if the owner of record is
present to vote or is represented by proxy.
HOW ARE VOTES COUNTED?
The holders of a majority in interest of all stock issued, outstanding and
entitled to vote are required to be present in person or represented by proxy at
the Meeting in order to constitute a quorum for the transaction of business.
Abstentions and broker non-votes are treated in the same manner as shares
present or represented at the Meeting for purposes of determining the existence
of a quorum.
For proxy item 1, the six nominees for director who receive the most votes will
be elected. If you do not vote for a nominee, or you indicate "withhold
authority to vote" on your proxy card, your vote will not count for or against
any nominee.
The affirmative votes of holders of at least a majority of the shares of the
Common Stock present in person, or represented by proxy, and entitled to vote at
the Meeting are required to decide proxy items 2 and 3 and any other business
that properly comes before the Meeting.
The total number of votes that are cast "for" proposals 2 and 3 will determine
whether the proposals are adopted. Abstentions are counted in determining the
total number of votes cast. While not counted as votes "for" or "against" a
proposal, abstentions have the same effect as votes against a proposal. Broker
non-votes are not counted in determining the number of votes cast. (A "broker
non-vote" occurs when a registered broker holding a customer's shares in the
name of the broker has not received voting instructions on a matter from the
customer and is barred by stock exchange rules from exercising discretionary
authority to vote on the matter. The broker will indicate this on the proxy
card.)
WHAT HAPPENS IF I VOTE BY PROXY?
If you sign, date and return the enclosed proxy card in time for the Meeting and
do not subsequently revoke it, your shares will be voted in accordance with your
instructions as marked on the proxy card. If you sign, date and return the proxy
card but do not specify how your shares are to be voted, then your shares will
be voted FOR the proxy items numbered (1), (2) and (3) on the proxy card.
We are not now aware of any other matters to be presented at the Annual Meeting
except for those described in this Proxy Statement. However, if any other
matters not described in the Proxy Statement are properly presented at the
meeting, the Proxies will use their own judgment to determine how to vote your
shares.
<PAGE>
PROXY STATEMENT
Elligent Consulting Group, Inc.
Page 3
If the meeting is adjourned, your Common Stock may be voted by the Proxies on
the new meeting date as well, unless you have revoked your proxy instructions
prior to that time.
CAN I REVOKE MY PROXY CARD
INSTRUCTIONS?
You may revoke your proxy at any time before it is exercised by returning to us
another properly signed proxy card representing such shares and bearing a later
date or by delivering a written revocation letter to Edwin T. Brondo, Secretary
of the Corporation. Mr. Brondo's mailing address is Elligent Consulting Group,
Inc., 152 West 57th Street, 40th floor, New York, New York 10019. If you attend
the Meeting, you may vote in person even though you have previously sent in a
proxy card and your vote at the meeting will supercede your vote submitted on
your proxy card.
WHAT DO I NEED TO DO IF I PLAN TO
ATTEND THE ANNUAL MEETING?
If you are a holder of record of shares of our Common Stock and you plan to
attend the Annual Meeting, you need only bring a form of personal identification
with you in order to be admitted to the Meeting. If you are not a record holder
of shares but hold our Common Stock through a bank or broker, you will need
proof of ownership to be admitted to the Meeting. A recent brokerage statement
or a letter from a bank or broker are examples of proof of ownership. If you
hold your shares through a broker or bank and want to vote in person at the
Meeting, you will need to contact the registered holder of your shares and
obtain a proxy card in your name from that registered holder.
WHO PAYS THE EXPENSES OF THIS
SOLICITATION?
We bear the cost of preparing, assembling and mailing the Notice, Proxy
Statement and proxy card for the Meeting. We have retained ADP Proxy Services to
assist in the solicitation of proxies and we will compensate them in an
estimated amount of $900 plus reasonable out-of-pocket expenses for this
service. In addition to such solicitation and solicitation by use of the mails,
employees of the holding company may solicit proxies, by personal interview, by
telephone or by other means of communication, without any additional
compensation. We will also provide persons, firms, banks and corporations
holding shares in their names, or in the names of their nominees, which in
either case are beneficially owned by others, with proxy materials for
transmittal to the beneficial owners and we will reimburse the record holders
for their reasonable expenses in transmitting those materials.
<PAGE>
PROXY STATEMENT
Elligent Consulting Group, Inc.
Page 4
ELECTION OF DIRECTORS
(PROXY ITEM 1)
INFORMATION ABOUT THE NOMINEES
An entire Board of Directors, consisting of six directors, is to be elected at
the Annual Meeting. Each director elected will hold office for a one year term
that will begin on July 1, 1999, and expire on June 30, 2000. If any director
resigns or otherwise is unable to complete his or her term of office, the Board
will appoint another director for the remainder of the resigning director's
term.
Each Director will continue in office until the Director's term expires and
until his successor is elected and qualified or until his earlier death,
resignation or removal.
The Board has nominated the five currently serving directors: Andreas Typaldos,
Edwin T. Brondo, Scott Newman, Michel Berty and Lloyd T. Rochford to serve on
the Board for the following year. In addition, the board has nominated a new
director Peter I. Cittadini to stand for election to the board for the following
year. This will increase the size of the board from five to six members.
Information with respect to the nominees is set forth below.
We have made inquiries and we believe that each of the nominees will be willing
and able to serve if elected. If any nominee is unwilling or unable to serve,
discretionary authority is reserved to vote for a substitute chosen by the Board
of Directors, or the Board may reduce the number of Directors.
ANDREAS TYPALDOS
(age 52)
Chairman of the Board and President. Mr. Typaldos was founder, President and CEO
of Computron Software, Inc., an international public software and consulting
company until 1996. He is also founder, Chairman, and major shareholder of
Enikia, LLC, an advanced home networking and communications company. Mr.
Typaldos was nominated to serve as chairman of the board of the Registrant
effective August 1, 1998.
Edwin T. Brondo
(age 51)
Director and member of the Audit Committee, Executive Vice President, Chief
Financial Officer, Secretary and Treasurer. Mr. Brondo was Vice President of
First Albany Companies, Inc. and Senior Vice President, Chief Administrative
Officer of First Albany Corporation from May 1993 until December 1997. Mr.
Brondo currently serves as a director of Computron Software, Inc. a company
listed on the American Stock Exchange. During the last five years Mr. Brondo was
a senior consultant at Comtex Information System, Inc. and a senior financial
executive at Bankers Trust Company. He has also held senior positions at Goldman
Sachs & Co., Morgan Stanley & Co. and G.A. Saxton.
Scott Newman
(age 39)
Director and Vice President. Mr. Newman is co-founder and president of
Conversion Services International, Inc. and has served in that capacity since
its founding in 1989.
<PAGE>
PROXY STATEMENT
Elligent Consulting Group, Inc.
Page 5
MICHEL BERTY
(age 59)
Director and member of the Audit and Compensation Committees. Mr. Berty is
currently a member of the board of directors of Mastech, a large public
consulting services company. He is also the Chairperson of Zmax, a Year 2000
NASDAQ company, a member of the board of directors of LEVEL 8, Merant, Sapiens
International, Ascent Logic Corporation and BuySmart, Inc., and is a former CEO
of Cap Gemini America, a $700 million consulting services company, and member of
the executive committee of Cap Gemini Sogeti, a $5 billion consulting services
company. Mr. Berty has been a member of our board of directors since August 27,
1998.
Lloyd T. Rochford
(age 52)
Director and member of the Audit and Compensation Committees. In February of
1989, Mr. Rochford founded Magnum Hunter Resources, Inc. and served as a
director and as its Chief Executive Officer through the end of 1995. Commencing
in January of 1996 through June of 1997, Mr. Rochford served as Magnum's
Chairman of the Board of Directors. Magnum is engaged in the exploration for and
the production of oil and gas and is a company listed on the American Stock
Exchange. Since his resignation from Magnum, Mr. Rochford pursued his own
personal business interests until being elected a director of the Corporation in
July of 1997. Mr. Rochford served as chairman of the board until August 1, 1998.
Peter I. Cittadini
(Age 43)
Mr. Chittadini has been nominated for election to the board. If elected the
board size will increase to six. Mr. Cittadini has 20 hears experience as an
executive in the relational database and software industry and joined Actuate in
1995. Prior to Actuate, he spent three years at Interleaf, Inc., most recently
as Senior Vice President of Worldwide Operations, where he was responsible for
worldwide sales, marketing, customer support and services of this $120 million
company. At Interleaf, Mr. Cittadini successfully redirected the corporation to
focus on the lucrative integrated document management market. Prior to
Interleaf, he spent six years at Oracle Corp., where he was Vice President,
Northeast Division, and led Oracle's most successful sales operation. Mr.
Cittadini has also held sales management and technical positions at Applied Data
Research, CSC Infonet and MacMillan, Inc. He has a BA in Liberal Arts from
Boston College.
YOUR DIRECTORS RECOMMEND A VOTE FOR THE ELECTION
OF THE FIVE NOMINEES UNDER PROPOSAL NO. 1
APPROVAL OF AUDITORS
(PROXY ITEM 2)
Our Board of Directors, acting upon the recommendation of its Audit Committee,
has selected the firm of Moore Stephens, P.C., certified public accountants, 340
North Avenue, Cranford, New Jersey 07016-2496, as independent accountants to
examine our financial statements for the year ending December 31, 1999, and to
perform other appropriate accounting services. Moore Stephens audited our
financial statements for the transition period from August 1, 1998, to December
31, 1998. A resolution will be presented to the Annual Meeting to ratify this
selection. Representatives of Moore Stephens will be available to answer
questions at the Annual Meeting and are free to make statements during the
meeting. The affirmative vote of a majority of our common stock holders entitled
to vote and represented at the meeting is needed to ratify the selection. If the
share owners do not ratify the appointment of Moore Stephens, the selection of
independent accountants will be reconsidered by the Board of Directors.
<PAGE>
PROXY STATEMENT
Elligent Consulting Group, Inc.
Page 6
For the fiscal year ended July 31, 1998, Hansen, Barnett & Maxwell, P.C.
provided our audit services, including the examination of our annual
consolidated financial statements, review of unaudited quarterly financial
information, assistance and consultation in connection with other filings with
the Commission, and consultation in connection with various audit-related and
accounting matters. The Company does not expect that representatives of Moore
Stephens nor Hansen, Barnett & Maxwell will be present at the annual meeting.
We selected Moore Stephens because of the increased size and complexity of our
operations and the greater ability of Moore Stephens to provide accounting
support in the geographic areas in which we operate. None of the financial
statements prepared by Hansen, Barnett & Maxwell or Moore Stephens contained any
adverse or disclaimer of opinion, nor were they modified as to uncertainty,
audit scope, or accounting principles.
The Proxies will vote in favor of ratifying the selection of Moore Stephens
unless instructions to the contrary are indicated on the accompanying proxy
form.
YOUR DIRECTORS RECOMMEND A VOTE FOR PROPOSAL NO. 2.
APPROVAL OF 1998 STOCK OPTION PLAN
(PROXY ITEM 3)
The Compensation Committee adopted the 1998 Stock Option Plan and recommends
approval by the share owners. This plan was instituted as an additional
compensation platform for our Directors, Officers, employees and consultants.
SUMMARY OF THE 1998 STOCK OPTION PLAN
The Board adopted the 1998 Stock Option Plan in August 1998 (the "Plan"). For
the purposes of this summary, unless otherwise stated, "Plan" will refer to the
1998 Stock Option Plan. There are 1,500,000 shares of Common Stock available for
issuance upon exercise of options granted under the Plan. We intend to submit
the Plan to our shareholders for approval at our next annual meeting of
shareholders. At December 31, 1998, we had outstanding options to purchase
90,100 shares at $5.00 vesting over a three-year period. The options expire ten
years from the date of issuance. These options will become effective upon
approval of the Plan by our shareholders.
GENERAL
The Plan authorized us to grant to our employees and directors (i) incentive
stock options to purchase shares of Common Stock and (ii) non-qualified stock
options to purchase shares of Common Stock.
OBJECTIVES
The objectives of the Plan are to provide incentives to our key employees,
directors, officers and consultants to encourage them to devote their abilities
and industry to the success of our business enterprise. We intend to achieve
this purpose by extending an additional long-term incentive for high levels of
performance and unusual effort.
OVERSIGHT
A Committee of the Board administers the Plan by making determinations regarding
the persons to whom options should be granted and the amount, terms, conditions
and restrictions of the awards. It also has the authority to interpret the
provisions of the Plan and to establish and amend rules for its administration
<PAGE>
PROXY STATEMENT
Elligent Consulting Group, Inc.
Page 7
subject to the Plan's limitations. This Committee is comprised of non-employee
directors as required by Rule 16b-3 of the Securities and Exchange Act of 1934,
as amended.
STATUTORY CONDITIONS ON STOCK OPTIONS
EXERCISE PRICE. Incentive stock options granted under the Plan must have an
exercise price at least equal to 100% of the fair market value of our Common
Stock as of the date of grant. Incentive stock options granted to any person who
owns, immediately after the grant, stock possessing more than 10% of the
combined voting power of all classes of our stock, or of any parent or
subsidiary corporation, must have an exercise price at least equal to 110% of
the fair market value of our Common Stock on the date of grant. Non-statutory
stock options may have exercise prices as determined by the Committee or the
Board.
DOLLAR LIMIT. The aggregate fair market value, determined as of the time an
incentive stock option is granted, of our Common Stock with respect to which
incentive stock options are exercisable by an employee for the first time during
any calendar year, cannot exceed $100,000. However, there is no aggregate dollar
limitation on the amount of non-statutory stock options which may be exercisable
for the first time during any calendar year.
EXPIRATION DATE. Any option granted under the Plan will expire at the time fixed
by the Committee, which cannot be more than ten years after the date it is
granted or, in the case of any person who owns more than 10% of the combined
voting power of all classes of our stock or of any subsidiary corporation, not
more than five years after the date of grant.
EXERCISABILITY. The Committee may also specify when all or part of an option
becomes exercisable, but in the absence of such specification, the option will
become exercisable in four (4) equal annual installments, the first of which
becomes exercisable on the first anniversary of the date of grant of the option.
However, the Compensation Committee may accelerate the exercisability of any
option or any part thereof at its discretion.
ASSIGNABILITY. Options granted under the Plan are not assignable. Incentive
Stock Options may be exercised only while the optionee is employed by us or
within twelve months after termination by reason of death, within twelve months
after the date of disability, or within three months after termination for any
other reason.
PAYMENT UPON EXERCISE OF OPTIONS. Payment of the exercise price for any option
may be in cash, by withheld shares which, upon exercise, have a fair market
value at the time the option is exercised equal to the option price (plus
applicable withholding tax) or in the form of shares of our Common Stock.
TAX CONSEQUENCES OF OPTIONS. An employee or director will not recognize income
on the awarding of incentive stock options and nonstatutory options under the
Plan. An optionee will recognize ordinary income as the result of the exercise
of a nonstatutory stock option in the amount of the excess of the fair market
value of the stock on the day of exercise over the option exercise price.
An employee will not recognize income on the exercise of an incentive stock
option, unless the option exercise price is paid with stock acquired on the
exercise of an incentive stock option and the following holding period for such
stock has not been satisfied. The employee will recognize long-term capital gain
or loss on a sale of the shares acquired on exercise, provided the shares
acquired are not sold or otherwise disposed of before the earlier of: (i) two
years from the date of award of the option or (ii) one year from the date of
exercise. If the shares are not held for the required period of time, the
employee will recognize ordinary income to the extent the fair market value of
the stock at the time the option is exercised exceeds the option price, but
limited to the gain recognized on sale. The balance of any such gain will be a
short-term capital gain. Exercise of an option with previously owned stock is
not a taxable disposition of such stock.
<PAGE>
PROXY STATEMENT
Elligent Consulting Group, Inc.
Page 8
An employee generally must include in alternative minimum taxable income the
amount by which the price he paid for an incentive stock option is exceeded by
the option's fair market value at the time his rights to the stock are freely
transferrable or are not subject to a substantial risk of forfeiture.
The Company and its subsidiaries will be entitled to deductions for federal
income tax purposes as a result of the exercise of a nonstatutory option and the
disqualifying sale or disposition of incentive stock options in the year and the
amount that the employee recognizes ordinary income as a result of such
disqualifying disposition.
YOUR DIRECTORS RECOMMEND A VOTE FOR PROPOSAL NO. 3.
INFORMATION ABOUT THE BOARD AND ITS COMMITTEES
GENERAL
The Corporation is governed by a Board of Directors and various committees of
the Board which meet throughout the year. During the five months since the
recapitalization of the Corporation, the Board held four meetings, at which all
members of the Board were in attendance. The Board has an Audit Committee and a
Compensation Committee.
AUDIT COMMITTEE
The functions of the Audit Committee include recommending the appointment of the
Corporation's independent auditors, overseeing the implementation of appropriate
internal control mechanisms, reviewing the financial results on a quarterly
basis and recommending or approving appropriate control procedures.
In addition, the committee is responsible for reviewing matters associated with
internal control and the management of risk. The Audit Committee of the
Corporation held one meeting in 1998, at which all members were present.
COMPENSATION COMMITTEE
The responsibilities of the Compensation Committee of the Corporation include
approving, or recommending to the Board for its approval, the compensation of
top executives of the corporation, and discharging duties under the
Corporation's Stock Option Plan. Each member of the Compensation Committee has
been, and will be, a non-employee director for purposes of administering the
Stock Option Plan under Rule 16b-3 of the Securities Exchange Act of 1934. In
1998, the Compensation Committee held one meeting at which all members were
present.
DIRECTORS' FEES AND OTHER ARRANGEMENTS
Employee Directors receive no additional compensation for their participation on
the Board. Throughout 1998, non-employee Directors received no compensation.
The Compensation Committee recommended that non-employee Directors receive a
retainer for services commencing with the 1999 calendar year. Non-employee
Directors will receive a retainer in the amount of $20,000 per annum, to be paid
ratably on July 1 and January 1 for the previous six months of service. One half
of the annual retainer must be paid in the form of Elligent Common Stock
equivalents. In addition, a director may make an irrevocable election on July 1
and January 1 of each year to defer all or a portion of the cash portion of the
retainer.
On each payment date, we calculate the number of share equivalents awarded to
each Director by dividing the deferred retainer amount by the closing market
price of the Corporation's Common Stock. The director's account maintained at
the Corporation will be credited with units so calculated. The value of the
<PAGE>
PROXY STATEMENT
Elligent Consulting Group, Inc.
Page 9
aggregate deferred share equivalents will be paid in cash to Directors when they
retire from the Board. The value will be determined by multiplying the total
deferred shares equivalents by the then current market value of the
Corporation's Common Stock.
Nevada Law permits the inclusion of a provision in the articles of incorporation
of a corporation limiting or eliminating the potential monetary liability of
directors to a corporation or its shareholders by reason of their conduct as
directors. These sections do not permit any limitation on, or the elimination
of, liability of a director for disloyalty to his corporation or its
shareholders, failing to act in good faith, engaging in intentional misconduct
or a knowing violation of the law, obtaining an improper personal benefit or
paying a dividend or approving a stock repurchase that was illegal under Nevada
law. Accordingly, the provisions limiting or eliminating the potential monetary
liability of directors permitted by Nevada law apply only to the "duty of care"
of directors, that is, to unintentional errors in their deliberations or
judgments and not to any form of "bad faith" conduct.
The Articles of Incorporation of the Corporation eliminate the personal monetary
liability of directors to the extent allowed under Nevada law. A shareholder is
able to prosecute an action against a director for monetary damages only if he
can show a breach of the duty of loyalty, a failure to act in good faith,
intentional misconduct, a knowing violation of law, an improper personal benefit
or an illegal dividend or stock repurchase, and not "negligence" or "gross
negligence" in satisfying the director's duty of care. This provision in the
Articles of Incorporation applies only to claims against a director arising out
of his role as a director and not in any other capacity or to his
responsibilities under any other law, such as the federal securities laws.
<PAGE>
PROXY STATEMENT
Elligent Consulting Group, Inc.
Page 10
EXECUTIVE COMPENSATION
The following table sets forth all cash compensation paid by the Company to the
chief executive officer and the most highly compensated executive officers and
key employees whose total remuneration exceeded $100,000 for services rendered
in all capacities to the Company during the last three completed fiscal years.
<TABLE>
<CAPTION>
Long Term
Compensation
Awards
--------------
Annual Securities
Name and Principal Compensation/ Underlying All Other
Positions Year Salary & Bonus Options (#)(4) Compensation (3)
- ------------------ ---- -------------- -------------- ----------------
<S> <C> <C> <C> <C>
Andreas Typaldos 1998 $104,167
Chief Executive Officer 1997 -0-
and President (1) 1996 -0-
Edwin T. Brondo 1998 $72,917
Executive Vice President, 1997 -0-
Chief Financial Officer, 1996 -0-
Secretary and Treasurer (2)
Scott Newman 1998 $127,831 $36,629
Vice President 1997 -0-
(President of Conversion 1996 -0-
Services International) (3)
Lloyd T. Rochford 1998 $12,000
Chief Executive Officer (3) 1997 -0-
1996 -0-
Glenn Peipert (3) 1998 $107,318 $6,976
1997 -0-
1996 -0-
</TABLE>
- ----------
(1) Salary for Mr. Typaldos was accrued beginning August 1, 1998, based upon an
annual rate of $250,000. This compensation was not paid during the five
months ended December 31, 1998.
(2) Salary for Mr. Brondo reflects payments made during the five month period
ended December 31, 1998, based upon an annual rate of $250,000.
(3) Salary for Messrs. Newman and Peipert reflect payments made during the five
months period ended December 31, 1998, based upon employment agreements at
an annual rate of $250,000. Mr. Rochford's salary was paid during the
fiscal year ended July 31, 1998.
<PAGE>
PROXY STATEMENT
Elligent Consulting Group, Inc.
Page 11
OWNERSHIP OF OUR COMMON STOCK
The following table set forth information as of March 18, 1999 with respect to
the number of shares of our Common Stock beneficially owned by individual
directors, by all directors and officers of the Corporation as a group, and by
persons known by the Corporation to own more than 5% of our Common Stock.
Name of Beneficial Number Percent of
Owner and Address of Shares Common Stock Owned
----------------- --------- ------------------
Andreas Typaldos (1) 10,350,000 69.96
152 West 57th Street, 40th floor
New York, New York 10019
Patra Holdings, LLC (1) 10,000,000 67.59
152 West 57th Street, 40th floor
New York, New York 10019
Edwin T. Brondo 1,000 *
152 West 57th Street, 40th floor
New York, New York 10019
Scott Newman 900,000 6.08
152 West 57th Street, 40th floor
New York, New York 10019
Michel Berty 25,000 *
152 West 57th Street, 40th floor
New York, New York 10019
Lloyd T. Rochford (2) 174,285 1.18
152 West 57th Street, 40th floor
New York, New York 10019
All directors and 11,450,285 77.40
officers as a group
(six persons)
- ----------
* Less than 1%
(1) Mr. Typaldos controls Patra Holdings, LLC and therefore beneficial
ownership of the shares held by Patra Holdings are attributed to Mr.
Typaldos.
(2) Mr. Rochford's holdings include 3,000 shares owned by his wife as to which
Mr. Rochford disclaims beneficial ownership.
OTHER MATTERS
The Board of Directors knows of no other matters to be brought before the
Meeting. If matters other than the ones listed in this Proxy Statement arise at
the Meeting, the persons named in the proxy will vote the shares represented by
the proxy according to their judgment.
<PAGE>
PROXY STATEMENT
Elligent Consulting Group, Inc.
Page 12
ANNUAL REPORT
The Company's Annual Report on Form 10KSB with certified financial statements
required to be filed for the fiscal year ended December 31, 1998, accompanies
this Notice and Proxy Statement and was mailed to all share owners of record on
or about May ___, 1999. Any exhibit to the annual report on Form 10-KSB will be
furnished to any requesting person who sets forth a good faith representation
that he or she was a beneficial owner of the Corporation's Common Stock on April
30, 1999. The fee for furnishing a copy of any exhibit will be 25 cents per page
plus $3.00 for postage and handling.
SHARE OWNERS' PROPOSALS FOR THE
2000 ANNUAL MEETING OF SHARE OWNERS
Elligent welcomes comments or suggestions from its share owners. If a share
owner wants to have a proposal formally considered at the 2000 Annual Share
Owners' Meeting, and included in the Proxy Statement for that Meeting, we must
receive the proposal in writing on or before January 18, 2000. If a proposal is
received by January 18, 2000, Elligent may include it in the Proxy Statement
and, if it does, may use its discretionary authority to vote on the proposal.
For proposals that are not submitted by January 18, Elligent may use its
discretionary voting authority when the proposal is raised at the Annual
Meeting, without inclusion of the proposal in its Proxy Statement.
By order of the Board of Directors,
Edwin T. Brondo
Secretary
<PAGE>
ELLIGENT CONSULTING GROUP, INC.
Proxy Solicited on Behalf of the Board of Directors of
P The Corporation for Annual Meeting June 10, 1999
R
O The undersigned share owner of ELLIGENT CONSULTING GROUP, INC. (the
X "Corporation") acknowledges receipt of the Notice of Annual Meeting of
Y Share Owners and Proxy Statement each dated May 18, 1999, and the
undersigned revokes all prior proxies and appoints EDWIN T. BRONDO, LLOYD
T. ROCHFORD, and MICHEL BERTY, and each of them, proxies for the
undersigned to vote at the Annual Meeting of Share Owners to be held at 110
West 57th Street, New York, New York, at 10:00 a.m. on June 10, 1999, and
any adjournment or postponement thereof, on all matters coming properly
before said meeting.
Election of Directors, Nominees:
Andreas Typaidos, Edwin T. Brondo, Scott Newman,
Michel Berty, Lloyd T. Rochford and Peter I. Cittadini
Please mark, sign, date and return Proxy Card promptly using the enclosed
envelope.
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^FOLD AND DETACH HERE^
[X] Please mark your
votes as this
example
This proxy, when properly executed, will be voted in the manner directed herein
by the undersigned shareholder. If no direction is made, this proxy will be
voted FOR proposals 1, 2 and 3.
The Board of Directors of ELLIGENT CONSULTING GROUP, INC. recommends a vote FOR:
FOR WITHHELD
1. Election of directors [ ] [ ]
For, except vote withheld from the following nominee(s):
2. Approval of Moore Stephens PC as the FOR AGAINST ABSTAIN
independent auditors of the [ ] [ ] [ ]
Corporation.
3. Ratification of 1998 Stock Option Plan. [ ] [ ] [ ]
SIGNATURE: _____________________________________________ DATE: _________________
NOTE: Please sign name exactly as printed hereon. Joint owners should each sign.
When signing as attorney, administrator, executor, guardian or trustee, please
give title as such.
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^FOLD AND DETACH HERE^
