SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES EXCHANGE ACT OF 1934
Filed by the Registrant X
Filed by a Party other than the Registrant |_| Check the appropriate
box:
|_| Preliminary Proxy Statement
|_| Confidential, for Use of the Commission Only
(as permitted by Rule 14a-6(e)(2)
X Definitive Proxy Statement
|_| Definitive Additional Materials
|_| Soliciting Material Pursuant to ss.240.14a-11(c) or ss.240.14a-12
GREENLAND CORPORATION
(Name of Registrant as specified in its charter)
Commission File Number: 017833
(Name of Registrant as specified in its charter)
Commission File Number: 017833
(Name of Person(s) Filing Proxy Statement)
GREENLAND CORPORATION
Payment of Filing Fee (Check the appropriate box):
X No fee required.
|_| Fee computed on the 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. (Set forth the amount on which the
filing is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(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 previ ous filing by registration statement number,
or the Form or Schedule and the date of its filing.
<PAGE>
GREENLAND
CORPORATION
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
AND PROXY STATEMENT
To the Shareholders of Greenland Corporation:
Notice is hereby given that the Annual Meeting of the Shareholders of
Greenland Corporation (the "Company") will be held at the Company's offices at
7084 Miramar Road, 4th Floor, San Diego, California 92121, on Friday, April 18,
1997 at 10:00 AM, for the following purposes:
To elect directors for the ensuing year to serve until the next
Annual Meeting of Shareholders and until their successors have
been elected and qualified. The present Board of Directors of the
Company has nominated and recommends FOR election the following
four persons:
Eric W. Gaer
Kevin G. Smith
Michael H. DeDomenico
Guy R. Nelson
To elect the Company's independent auditors for the ensuing year. The
Board of Directors has nominated Smith & Company and recommends
FOR their election.
To approve the change of the Company's name (and its NASD symbol) to
AirLink Corporation. The Board of Directors recommends a vote FOR
the change of the name of the Company.
To amend the Company's Articles of Incorporation to effect the
increase of its authorized common stock. The Board of Directors
recommends a vote FOR the increase of common stock authorized from
25,000,000 shares to 50,000,000 shares.
To amend the Company's Articles of Incorporation to authorize the
issuance of up to 2 classes of Preferred Stock; 10,000 shares for
each class. Par value to be determined at the discretion of the
Board of Directors. The Board of Directors recommends a vote FOR
the issuance of Preferred Stock.
To adopt and ratify the proposed 1997 Stock Option Plan previously
ratified by the Company's Board of Directors.
To adopt and ratify the proposed 1997 Employee Stock Purchase Plan
previously ratified by the Company's Board of Directors.
To transact such other business as may be properly brought before the
Annual Meeting or any adjournment thereof.
The Board of Directors has fixed the close of business on March 14,
1997 as the record date for the determination of shareholders entitled to notice
of and to vote at the Annual Meeting. A list of such shareholders shall be open
to the examination of any shareholder at the Annual Meeting and for a period of
ten days prior to the date of the Annual Meeting at the offices of Greenland
Corporation.
Accompanying this Notice is a Proxy. WHETHER OR NOT YOU EXPECT TO BE AT
THE ANNUAL MEETING, PLEASE SIGN AND DATE THE ENCLOSED PROXY AND RETURN IT
PROMPTLY. If you plan to attend the Annual Meeting and wish to vote your shares
personally, you may do so at any time before the Proxy is voted.
A copy of the Company's Form 10-KSB for the Fiscal Year ended December
31, 1996, filed with the Securities and Exchange Commission, is available to
shareholders upon request.
All shareholders are cordially invited to attend the meeting.
BY ORDER OF THE BOARD OF DIRECTORS
/s/
Michael H. DeDomenico
Secretary
March 17, 1997
San Diego, California
<PAGE>
GREENLAND
CORPORATION
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
AND PROXY STATEMENT
San Diego, California
March 17, 1997
PROXY STATEMENT, REVISED
The Board of Directors of Greenland Corporation, a Nevada corporation (the
"Company" or "Greenland") is soliciting the enclosed Proxy for use at the Annual
Meeting of Shareholders of the Company to be held on April 18, 1997 (the "Annual
Meeting"), and at any adjournments thereof. This Proxy Statement was first sent
to shareholders on or about March 14, 1997.
Unless contrary instructions are indicated on the Proxy, all shares
represented by valid Proxies received pursuant to this solicitation (and not
revoked before they are voted) will be voted FOR the election of the three
nominees for directors named below, FOR the election of Smith & Company as the
Company's independent auditors for the ensuing year, and FOR the ratification of
all acts by officers and directors of the Company in the previous year. As to
any other business which may properly come before the Annual Meeting and be
submitted to a vote of the shareholders, Proxies received by the Board of
Directors will be voted in accordance with the best judgment of the holders
thereof.
A Proxy may be revoked by written notice to the Secretary of the Company at
any time prior to the Annual Meeting, by executing a later Proxy or by attending
the Annual Meeting and voting in person.
The Company will bear the cost of solicitation of Proxies. In addition to
the use of mails, Proxies may be solicited by personal interview, telephone, or
telegraph, by officers, directors, and other employees of the Company.
The Company's mailing address is 7084 Miramar Road, 4th Floor, San Diego,
California 92121, which is the address of the Company's offices.
VOTING
Shareholders of record at the close of business on March 14, 1997 (the
"Record Date") will be entitled to notice of and to vote at the Annual Meeting
or any adjournments thereof.
As of that date 19,167,091 shares of common stock, par value $.001, of the
Company ("Common Stock") were outstanding (excluding warrants to purchase
1,528,000 shares), representing the only voting securities of the Company. Each
share of Common Stock is entitled to one vote.
Votes cast by Proxy or in person at the Annual meeting will be counted by
the person appointed by the Company to act as Inspector of Election for the
Annual Meeting. The Inspector of Election will treat shares represented by
Proxies that reflect abstentions or include "broker non-votes" as shares that
are present and entitled to vote for purposes of determining the presence of a
quorum. Abstentions or "broker non-votes" do not constitute a vote FOR or
AGAINST any matter and thus will be disregarded in the calculation of "votes
cast". Any unmarked Proxies, including those submitted by brokers or nominees,
will be voted FOR the nominees of the Board of Directors, as indicated in the
accompanying Proxy card.
SECURITIES OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information regarding the beneficial
ownership of the Company's Common Stock as of March 14, 1997, by (i) each of the
Company's named executive officers and directors, and (ii) the Company's named
executive officers and directors as a group.
One shareholder, Blue Chip Securities, is beneficial owner of 1,465,125
shares of the Company's Common Stock, or 7.6% of the issued and outstanding
shares at March 14, 1997.
No other shareholder is known by the Company to be the beneficial owner of
more than 5% of any class of the Company's voting securities. These individuals
have sole investment and voting power with respect to such shares. Their
business address is the same as that of the Company.
For purposes of this Proxy Statement, beneficial ownership of securities is
defined in accordance with the rules of the Securities and Exchange Commission
with respect to securities, regardless of any economic interests therein. Except
as otherwise indicated, the Company believes that the beneficial owners of the
securities listed below have sole investment and voting power with respect to
such shares, subject to community property laws where applicable. Unless
otherwise indicated, the business address for each of the individuals listed
below is the same as that of the Company.
<PAGE>
Number of Shares Percent
Name Beneficially Owned Beneficially Owned
- ------------------------------------------------------------------------------
Officers and Directors
Eric W. Gaer(1)
President, CEO, Director ...........746,619 3.9%
Kevin G. Smith(2)
Chairman, CFO, Director ............700,000 3.7%
Michael H. DeDomenico(3)
Secretary, Director ................339,996. 1.8%
Guy R. Nelson(4)
Director.............................25,000 0.1%
Officers and Directors as a group
(5 persons) ......................1,811,615 9.5%
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(1)Excluding warrants now exercisable to purchase 500,000 shares of
Greenland common stock. (2)Excluding warrants now exercisable to purchase
500,000 shares of Greenland common stock. (3)Excluding warrants now
exercisable to purchase 500,000 shares of Greenland common stock.
(4)Excluding warrants now exercisable to purchase 28,000 shares of
Greenland common stock.
PROPOSAL 1
ELECTION OF DIRECTORS
The Board of Directors of the Company has nominated and recommends FOR
election as directors the four persons named below, all of whom are currently
serving as directors of the Company. The enclosed Proxy will be voted FOR the
persons nominated unless otherwise indicated. If any of the nominees should be
unable to serve or should decline to do so, the discretionary authority provided
in the Proxy will be exercised by the present Board of Directors to vote for a
substitute or substitutes to be designated by the Board of Directors. The Board
of Directors has no reason to believe that any substitute nominee or nominees
will be required.
In voting for the election of directors of the Company under Nevada
Corporation Law, if, prior to the commencement of voting, any shareholder has
given notice of his intention to cumulate his votes at the meeting, then all
shareholders may cumulate their votes in the election of directors for any
nominee if the nominee's name was placed in nomination prior to the voting.
Under cumulative voting, each share holder is entitled in the election of 4
directors to vote one vote for each share held by him multiplied by the number
of directors to be elected, and he may cast all such votes for a single nominee
for director or may distribute them among any two or more nominees as he sees
fit. If no such notice is given, there will be no cumulative voting. In the
absence of cumulative voting, each shareholder may cast one vote for each share
held by him multiplied by the number of directors to be elected, but may not
cast more votes than the number of shares owned for any candidate and therefore
a simple majority of the shares represented and voting will elect all of the
directors. Under either form of voting, the candidates receiving the highest
number of votes, up to the number of directors to be elected, will be elected.
In the event of cumulative voting, the Proxy solicited by the Board of
Directors confers discretionary authority on the proxies to cumulate votes so as
to elect the maximum number of directors, The Proxy may not be voted for more
than three persons.
<PAGE>
INFORMATION REGARDING NOMINEES
The information set forth below as to each nominee for Director has been
furnished to the Company by the respective nominees.
Eric W. Gaer, 48, is President, Chief Executive Officer, and a Director of
Greenland. He has been a Director since 1995. He has broad experience in the
general development and promotion of high-technology products and services. Mr.
Gaer has more than 25 years of professional experience in high-technology
management and marketing. He has served in executive capacities for
high-technology firms such as Merisel, Inc., Venture Software, Daybreak
Technologies, Inc., and Personal Computer Products, Inc. Prior to joining
Greenland, Mr. Gaer was President and Chief Executive Officer of Integrated
Communications Access Network and President and Chief Executive Officer of Ariel
Systems, Inc.. He earned his Bachelor's degree in Mass Communications from
California State University at Northridge.
Kevin Smith, 39, is Chairman of the Board, Chief Financial Officer, and a
Director of Greenland Corporation. He has served as a Director since 1994. Mr.
Smith is the past President of Exten Industries, a publicly traded company (OTC)
in the biomedical industry. In 1992, Mr. Smith founded National Air and Energy,
Inc., which is the marketer and manufacturer of a patented thermal engine known
as the Sunchaser System.
Michael DeDomenico, 52, is a Director of Greenland Corporation and
President of its GAM subsidiary. He has served as a director since 1994. Mr.
DeDomenico has been in the real estate business as a developer since 1977 and is
the founder and President of GAM. Mr. DeDomenico is a full-time employee of the
Company. He received his Bachelor's degree from Cal Western University and his
Master of Arts degree from Northern Arizona University.
Guy R. Nelson, 52, is a Director of Greenland Corporation. He recently
retired from the Western Area Power Administration, a federal agency, where he
had been Energy Services Manager since 1985. He has been involved in engineering
and technical aspects of conservation, planning, design, and implementation of
resource options, both demand-side and supply-side. Prior to his tenure at
Western Area Power, Nelson served as Director of the Environmental Protection
Agency's (EPA) Industrial Technology Transfer Division. A chemical engineer by
trade, Nelson is an active participant in utility trade associations, including
the California Municipal Utility Association and the Association of Energy
Engineers. He is a board member of the American Council for an Energy Efficient
Economy and the Utility Forum. He joined the Greenland Board of Directors in
April 1996.
RECOMMENDATION OF THE
BOARD OF DIRECTORS
The Board of Directors recommends that share holders vote FOR the slate of
nominees set forth above. Proxies solicited by the Board of Directors will be so
voted unless shareholders specify otherwise on the accompanying Proxy.
EXECUTIVE COMPENSATION
None of the Company's executive officers and directors received annual
compensation (including salaries) over $60,000 during the year ended December
31, 1996.
Notwithstanding the above, Eric W. Gaer and Kevin G. Smith have one-year
employment contracts with the Company, renewable annually, which call for the
payment of cash compensation of $98.800 per year. Michael H. deDomenico has a
one-year employment contract with the Company, renewable annually, which calls
for the payment of cash com pensation of $78.000 per year. At this time, each of
the officers and directors noted above have been deferring contracted
compensation in order to ease the burden on the Company's cash position.
PROPOSAL 2
ELECTION OF INDEPENDENT AUDITORS
The Board of Directors has selected Smith & Company to serve as the
Company's independent accountants for the 1997 fiscal year. Smith & Company has
served as the Company's independent accountants since 1994.
<PAGE>
PROPOSAL 3
CORPORATE NAME CHANGE
On December 20, 1996, the Board of Directors unanimously adopted a
resolution proposing that the name of the Company be changed from Greenland
Corporation to AirLink Corporation.
The Board of Directors recommends a vote FOR approval of the resolution
since the new name of AirLink Corporation more accurately describes the
principal business of the Company as a developer and marketer of high technology
products devoted to automated meter reading for utilities; and more particularly
to enable the Company to position itself better with a name that better fits is
operational strategies.
PROPOSAL 4
AMENDMENT OF THE COMPANY'S
ARTICLES OF INCORPORATION TO
INCREASE THE AMOUNT OF AUTHORIZED
COMMON STOCK
On December 20, 1996, the Board of Directors unanimously adopted a
resolution proposing that Article FIFTH of Greenland Corporation's Articles of
In corporation be amended to increase the authorized common stock of the Company
from 25,000,000 to 50,000,000 shares.
The Board of Directors recommends a vote FOR approval of the proposed
amendment of the Articles of Incorporation to allow for the future financing of
the Company's growth and expansions, as necessary.
The proposed amendment cannot become effective unless it is approved by a
majority of the stockholders entitled to vote thereon. The full text of the
amendment is included as Exhibit A to this Proxy Statement.
PROPOSAL 5
AMENDMENT OF THE COMPANY'S
ARTICLES OF INCORPORATION TO ISSUE
SHARES OF PREFERRED STOCK
On December 20, 1996, the Board of Directors unanimously adopted a
resolution proposing that Greenland Corporation's Articles of Incorporation be
amended to authorize the issuance of up to two classes (A and B) of Preferred
Stock; 10,000 shares for each class. At this time, the Board is uncertain as to
a determination of the par value of such Preferred Stock or whether it will, in
fact, issue such shares.
The Board of Directors recommends a vote FOR approval of the proposed
amendment of the Articles of Incorporation to allow for the future financing of
the Company's growth and expansions, as necessary.
The proposed amendment cannot become effective unless it is approved by a
majority of the stockholders entitled to vote thereon. The full text of the
Board resolution related to the amendment is included as Exhibit A to this Proxy
Statement.
PROPOSAL 6
ADOPTION AND RATIFICATION OF 1997
STOCK OPTION PLAN
General: The 1997 Stock Option Plan of Greenland Corporation (the "Plan")
was unanimously adopted by the Board of Directors on December 20, 1996. The Plan
provides for the granting of incentive stock options or non-statutory stock
options to key employees of the Company or any subsidiary and for the granting
of non-statutory stock options to non-employee directors.
Securities: The maximum number of shares of the Company's Common Stock
which may be issued upon exercise of options granted under the Plan is 5,000,000
shares, $.001 par value per share (subject to adjustments as a result of any
future stock splits, stock dividends, recapitalizations, reclassifications,
combinations, consolidations and mergers). If an option granted under the Plan
becomes unexercisable by expiration, surrender, termination or for any other
reason, the number of shares which were subject to the option but as to which
the option was not exercised will continue to be available under the Plan, and
new options may be granted in respect of such shares.
Eligibility: Any key employee or non-employee director of the Company or
any of its subsidiaries is eligible to be granted options under the plan. An
individual may hold more than one option, provided that the aggregate fair
market value (determined as of the time the option is granted) of incentive
stock options exercisable during any one calendar year may not, for any
employee, exceed $250,000 (plus unused carryovers).
<PAGE>
Administration and Duration: The Plan is administered by Greenland
Corporation's Board of Directors and, to the extent provided by the Board of
Directors, a committee (the "Committee") appointed by the Board of Directors.
The Board of Directors (or the Committee, if responsibility for any such matters
is delegated by the Board of Directors to the Committee) (hereafter the
"Administrator") is authorized to determine which employees are key employees,
to select those key employees and non-employee directors to whom options are to
be granted, to determine the number of shares to be subject to such option
grants, and which options are to be incentive stock options (consistent with the
Plan), to establish such rules relating to the administration of the Plan as it
may deem appropriate, and to issue such interpretations of the Plan and any
outstanding options thereunder as it may deem necessary or advisable.
The Board of Directors has the power to amend the Plan at any time;
provided, however, that (except for adjustments resulting from stock splits,
recapitalizations, etc.) the Board may not, without the approval of the
Company's stockholders, amend the Plan to increase the number of shares
available for options under the Plan, increase the maximum number of options
which may be granted to a member or all members of the Board of Directors,
materially increase the benefits accruing to individuals who participate in the
Plan, modify the eligibility requirements of the grant of options under the
Plan, or modify the restriction that no options granted to non-employee
directors may be exercised prior to the first anniversary of the date it is
granted. Further, no amendment of the Plan can, without the consent of the
option holder, adversely affect any rights or obligations under any option
previously granted.
No option may be granted under the Plan after December 31, 2006.
Terms of Options: The Plan requires that the option price for options
thereunder be at least 100% of the fair market value of the stock subject to the
option on the date the option is granted, provided that the option price must be
at least 100% of the fair market value in the case of incentive stock options
granted to persons then owning, directly or indirectly, more than 10% of the
total combined voting power of all classes of stock of Greenland Corporation,
any subsidiaries and any parent corporations. On December 20, 1996, the closing
bid and asked prices of Greenland common stock on the over-the-counter market as
reported by NASD Electronic Bulletin Board were $0.26 and $0.30 respectively.
No option may have a term in excess of ten years from its date of grant
and, except in the event of a merger, consolidation or reorganization of the
Company, no option granted to a non-employee director may be exercised in whole
or in part during the first year after it is granted. Incentive stock options
granted to persons then owning directly or indirectly, more than 10% of the
total combined voting power of all classes of stock of the Company, any
subsidiaries and any parent corporations, may not be exercised after five years
from the date of grant. Subject to the foregoing, options become exercisable at
such times and in such installments (which may be cumulative) as the
Administrator provides in the terms of each individual option. The Administrator
provides in the terms of each individual option when such option expires and
becomes unexercisable.
Any options granted under the Plan may, but need not, provide that the
option exercise period is subject to early termination if the option holder
ceases to be a director, officer or employee of the Company. The Plan also
grants to the Administrator the authority to make the common stock issuable upon
exercise of an option subject to a repurchase right in favor of the Company (or
its assigns), exercisable upon the option holder's cessation of director or
employee status, at the original option price paid by the option holder upon his
or her exercise of the option. These repurchase rights shall be exercisable by
the Company (or its assigns) upon such terms and conditions (including
provisions for such rights to expire in one or more instruments) as the
Administrator may specify in the agreement setting forth such rights. The Plan
also grants the Administrator the discretion to assist any employee in financing
the exercise of any options by authorizing a loan from the Company to the option
holder, permitting the option holder to pay the option price in installments, or
authorizing the Company to guarantee a third-party loan to the option holder.
The Plan provides that upon the dissolution or liquidation of the Company
or a merger or consolidation of the Company into another corporation, or upon
certain other reorganizations, the Administrator may (a) accelerate in whole or
in part the exercisability of outstanding options, (b) terminate in whole or in
part outstanding options upon at least ten days' notice to the option holders,
arrange to have the surviving corporation grant appropriately adjusted
replacement options, or (d) cancel in whole or in part outstanding options upon
payment to an option holder of cash equal to the different between (1) the fair
market value of what the option holder would have received upon the merger,
consolidation, dissolution or liquidation, as the case may be, had the option
holder exercised the option immediately prior to the effective date of said
event; and (2) the exercise price of the option.
<PAGE>
Subject to the Administrator's right to grant assistance in financing the
exercise of options and/or to limit the following alternatives in the terms of
particular stock option agreements, the Plan calls for option holders to pay the
option price in full at the time of exercise in cash or by check, by the
transfer to the Company of previously acquired shares of Greenland common stock
having a fair market value (determined on the date of delivery to the Company)
equal to the option price, or by a combination of cash and previously acquired
shares of Greenland common stock. This provision could permit "pyramiding" of
stock options, by which the delivery of even a small number of Greenland shares
could enable a holder to enjoy the economic benefit of a full exercise without
the need of paying any cash to the Company.
The option holder must make such representations and execute such documents
as the Company may require to effect compliance with applicable federal and
state securities laws. Other than the stock option agreements executed in
connection with each option grant, option holders are not provided with any
periodic reports concerning the status of their individual options.
In the event any change is made to the Com pany's common stock by reason of
a stock split, stock dividend, recapitalization, reclassification, combination
of shares, consolidation, or merger, unless such change results in the
termination of all outstanding options, the Administrator has the discretion to
make appropriate adjustments in the number and class of shares as to which all
options then outstanding under the Plan will be exercisable, and in the option
price per share. In such event, the Administrator may also adjust the maximum
number of shares to which options may be granted to any one or to all directors.
All such adjustments made by the Administrator will be final and binding upon
the option holders, the Company, and other interested persons.
Tax Consequences: The following is a general description of the federal
income tax consequences of options granted under the Plan. Incentive stock
options granted under the Plan are intended to satisfy the requirements of
Section 422A of the Internal Revenue Code. Non-statutory options granted under
the Plan do not satisfy such requirements. The federal income tax treatment for
the two types of options differs as follows:
Incentive Stock Options: Incentive stock options un der the Plan are
intended to be eligible for the favorable federal income tax treatment accorded
to "incentive stock options" under the Code.
There are generally no federal tax consequences to the option holder or the
Company by reason of the grant or exercise of an incentive stock option.
However, the exercise of an incentive stock option may increase the option
holder's alternative minimum tax liability, if any.
If an option holder holds stock acquired through exercise of an incentive
stock option for at least two years from the date on which the option is granted
and at least one year from the date on which the shares are transferred to the
option holder upon exercise of the option, any gain or loss on a disposition of
such stock will be long-term capital gain or loss. Generally, if the option
holder disposes of the stock before the expiration of either of these holding
periods (a "disqualifying disposition"), at the time of disposition, the option
holder will realize taxable ordinary income equal to the lesser of (a) the
excess of the stock's fair market value on the date of exercise over the
exercise price, or (b) the option holder's actual gain, if any, on the purchase
and sale. The option holder's additional gain, or any loss, upon the
disqualifying disposition will be a capital gain or loss, which will be
long-term or short-term depending on whether the stock was held for more than
one year. Long-term capital gains currently are generally subject to lower tax
rates than ordinary income. Slightly different rules may apply to option holders
who acquire stock subject to certain repurchase options or who are subject to
Section 16(b) of the Exchange Act.
To the extent the option holder recognized ordinary income by reason of a
disqualifying disposition, the Company will generally be entitled (subject to
the requirement of reasonableness, the provisions of Section 162(m) of the Code
and the satisfaction of a tax reporting obligation) to a corresponding business
expense deduction in the tax year in which the disqualifying disposition occurs.
Non-Statutory Options. Non-statutory stock options granted under the Plan
generally have the following income tax consequences:
<PAGE>
There are no tax consequences to the option holder or the Company by reason
of the grant of a non-statutory stock option. Upon exercise of a non-statutory
stock option, the option holder normally will recognize taxable ordinary income
equal to the excess of the stock's fair market value on the date of exercise
over the option exercise price. Generally, with respect to employees, the
Company is required to withhold from regular wages or supplemental wage payments
an amount based on the ordinary income recognized. Subject to the requirement of
reasonableness, the provisions of Section 162(m) of the Code, and the
satisfaction of a tax reporting obligation, the Company will generally be
entitled to a business expense deduction equal to the taxable ordinary income
realized by the option holder. Upon disposition of the stock, the option holder
will recognize a capital gain or loss equal to the difference between the
selling price and the sum of the amount paid for such stock plus any amount
recognized as ordinary income upon exercise of the option. Such gain or loss
will be long or short-term depending on whether the stock was held for more than
one year. Slightly different rules may apply to option holders who acquire stock
subject to certain repurchase options or who are subject to Section 16(b) of the
Exchange Act.
Potential Limitation on Company Deductions. As part of the Omnibus Budget
Reconciliation Act of 1993, the U.S. Congress amended the Code to add Section
162(m), which denies a deduction to any publicly held corporation for
compensation paid to certain employees in a taxable year to the extent that
compensation exceeds $1,000,000 for a covered employee. It is possible that
compensation attributable to stock options, when combined with all other types
of compensation received by a covered employee from the Company, may cause this
limitation to be exceeded in a particular year.
Certain kinds of compensation, including qualified "performance-based
compensation," are disregarded for purposes of the deduction limitation. In
accordance with proposed Treasury regulations issued under Section 162(m),
compensation attributable to stock options will qualify as performance-based
compensation, provided that the option is granted by a compensation committee
comprised solely of "outside directors" and either: (a) the option plan contains
a per-employee limitation on the number of shares for which options may be
granted during a specified period, the option plan, including the per-employee
limitation, is approved by the shareholders, and the exercise price of the
option is no less than the fair market value of the stock on the date of grant;
or (b) the option is granted (or exercisable) only upon the achievement (as
certified in writing by the compensation committee) of an objective performance
goal established in writing by the compensation committee while the outcome is
substantially uncertain, and the option is approved by share holders.
Other Tax Considerations. The foregoing discussion is intended to be a
general summary only of the federal income tax aspects of options granted under
the Plan; tax consequences may vary depending on the particular circumstances at
hand. In addition, administrative and judicial interpretations of the
application of the federal income tax laws are subject to change. Furthermore,
no information is given with respect to state or local taxes that may be
applicable. Participants in the Plan who are residents of or are employed in a
country other than the United States may be subject to taxation in accordance
with the tax laws of that particular country in addition to or in lieu of United
States federal income taxes.
Options Not Transferable. Options granted under the Plan are not
transferable, except by will or by the application of laws of descent and
distribution.
Vote Required. The approval of the holders of at least a majority of the
shares of common stock outstanding and entitled to vote is required for approval
of the adoption of the Plan.
Recommendation of the Board of Directors. The Board of Directors recommends
a vote FOR the adoption and ratification of the Plan.
<PAGE>
PROPOSAL 7
ADOPTION AND RATIFICATION OF 1997
STOCK PURCHASE PLAN
General: The 1997 Employee Stock Purchase Plan ("Purchase Plan") was
unanimously adopted by the Board of Directors on December 20, 1996. The Purchase
Plan permits employees to purchase the Company's common stock at a discounted
price. The Purchase Plan is designed to encourage and assist a broad spectrum of
employees of the Company to acquire an equity interest in the Company through
the purchase of its common stock. It is also intended to provide participating
employees the tax benefits under Section 421 of the Code. The Purchase Plan
covers an aggregate of 1,000,000 shares of the Company's common stock.
Management currently believes these shares to be sufficient for all stock
purchases under the Purchase Plan for approximately two years.
Eligibility. All employees, including executive officers and directors who
are employees, customarily employed more than 20 hours per week and more than
five months per year by the Company are eligible to participate in the Purchase
Plan on the first enroll ment date following employment. However, employees who
hold, directly or through options, five percent or more of the stock of the
Company are not eligible to participate.
Terms and Administration. Participants may elect to participate in the
Purchase Plan by contributing up to a maximum of 15 percent of their
compensation, or such lesser percentage as the Board may establish from time to
time. Enrollment dates are the first trading day of January, April, July, and
October or such other dates as may be established by the Board from time to
time. The first enrollment date will be April 1997. On the last trading day of
each December, March, June, and September, beginning in March 1997, or such
other dates as may be established by the Board from time to time, the Company
will apply finds then in each participant's account to the purchase of shares.
The cost of each share purchased is 85 percent of the lower of fair market value
of common stock on (a) the enrollment date or (b) the purchase date. The length
of the enrollment period may not exceed a maximum of 24 months. No participant's
right to acquire shares may accrue at a rate exceeding $25,000 of fair market
value of common stock (determined as of the first trading day in an enrollment
period) in any calendar year.
The Board may administer the Purchase Plan or the Board may delegate its
authority to a committee composed of not fewer than two outside directors and
may delegate routine matters to management. The Board may amend or terminate the
Purchase Plan at any time and may provide for an adjustment in the purchase
price and the number and kind of securities available under the Purchase Plan in
the event of a reorganization, recapitalization, stock split, or other similar
event. However, amendments that would in crease the number of shares reserved
for purchase, or would otherwise require shareholder approval in order to comply
with Federal securities regulations, require shareholder approval. Shares
available under the Purchase Plan may be either outstanding shares repurchased
by the Company or newly issued shares.
<PAGE>
As of December 20, 1996, 7 employees of the Company were eligible to
participate in the Purchase Plan. Since the number of shares purchased under the
Purchase Plan by any employee and the purchase price thereof are determined by
the level of voluntary contribution by such employee and the market price of the
shares in effect from time to time, the Company currently cannot determine the
number of shares that may be purchased in the future by any eligible individual
or group of individuals or the purchase price thereof.
Federal Tax Consequences. In general, participants will not have taxable
income or loss under the Purchase Plan until they sell or otherwise dispose of
shares acquired under the Purchase Plan (or die holding such shares). If the
shares are held, as of the date of sale or disposition, for longer than both:
(a) two years after the beginning of the enrollment period during which the
shares were purchased and (b) one year following purchase, a participant will
have taxable ordinary income equal to 15 percent of the fair market value of the
shares on the first day of the en rollment period (but not in excess of the gain
on the sale). Any additional gain from the sale will be long-term capital gain.
The Company is not entitled to an income tax deduction if the holding periods
are satisfied.
If the shares are disposed of before the expiration of both of the
foregoing holding periods (a "disqualifying disposition"), a participant will
have taxable ordinary income equal to the excess of the fair market value of the
shares on the purchase date over the purchase price. Such ordinary income is
subject to information reporting requirements and may become subject to income
and employment tax withholding. In addition, the participant will have taxable
gain (or loss) measured by the difference between the sale price and the
participant's purchase price plus the amount of ordinary income recognized,
which gain (or loss) will be long-term if the shares have been held as of the
date of sale for more than one year. The Company is entitled to an income tax
deduction equal to the amount of ordinary income recognized by a participant in
a disqualifying disposition.
Special Federal Income Tax Consideration Due to Short Swing Profit Rule.
The potential liability of a person subject to Section 16 of the Exchange Act to
repay short-swing profits from the resale of shares acquired under a Company
plan constitutes a "substantial risk of forfeiture" within the meaning of the
above-described rules, which is generally treated as lapsing at such time as the
potential liability under Section 16 lapses. Persons subject to Section 16 who
would be required by Section 16 to repay profits from the immediate resale of
stock acquired under a Company plan should consider whether to file a Section
83(b) election at the time they acquire stock under a Company plan in order to
avoid deferral of the date they are deemed to acquire shares for federal income
tax purposes. Vote Required. The approval of the holders of at least a majority
of the shares of common stock outstanding and entitled to vote is required for
approval of the adoption of the Purchase Plan. Recommendation of the Board of
Directors. The Board of Directors recommends a vote FOR the adoption of the
Purchase Plan.
OTHER MATTERS
The Board of Directors does not know of any matter to be presented at the
Annual Meeting which is not listed on the Notice of Annual Meeting and discussed
above. If other matters should properly come before the meeting however, the
persons names in the accompanying Proxy will vote all Proxies in accordance with
their best judgment.
STOCKHOLDER PROPOSALS FOR 1997
ANNUAL MEETING
Stockholder proposals intended to be presented at the 1997 Annual Meeting
(the meeting to be held following the end of fiscal year 1997) must be received
on or before December 31, 1997 by the Company at its office address set forth on
the first page of this proxy statement, and all the other conditions of Rule
14a-8 under the Securities Exchange Act of 1934 must be satisfied, for such
proposals to be included in Greenland Corporation's proxy statement and form of
proxy relating to that meeting.
<PAGE>
GREENLAND CORPORATION
SELECTED HISTORICAL COMBINED FINANCIAL DATA
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31, 1996 1995 1994
Audited Audited Audited
-------------- ------------- --------------
<S> <C> <C> <C>
Gross revenues $ 542,534 $ 452,315 $ 90,206
Operating earnings (loss) (886,162) (344,163) (110,338)
Other income (loss) - (242,990) -
Net earnings (loss) (886,162) (587,153) (110,338)
Earnings (loss) per common share (0.13) (0.15) (0.07)
-------------- ------------- --------------
Shares outstanding (weighted average) 6,637,617 4,003,478 1,578,037
At Year End
Current assets 144,825 70,160 727
Properties, net of depreciation 5,054,875 5,096,627 5,733,596
Other assets 2,854,616 3,627,325 55,490
Total assets 8,054,316 8,794,112 5,789,813
-------------- ------------- --------------
Current liabilities 515,326 267,523 515,014
Long-term debt 3,481,202 3,925,089 3,715,311
Total liabilities 4,287,318 4,493,402 4,283,311
-------------- ------------- --------------
Paid-in capital 5,624,428 5,312,008 1,876,452
Retained deficit (1,843,265) (957,103) (369,950)
Shareholders' equity 3,766,998 4,300,710 1,506,502
-------------- ------------- --------------
Common shares outstanding 15,214,460 13,190,253 2,956,147
</TABLE>
The Company's Form 10-KSB for the fiscal year ended December 31, 1996 will
be filed with the Securities and Exchange Commission in March 1997. Additional
information is available to beneficial owners of Common Stock of the Company on
the record date for the Annual Meeting of Shareholders.
A copy of the Company's Form 10-KSB will be furnished without charge upon
receipt of a written request identifying the person so request ing a report as a
shareholder of the Company at such date. Requests should be directed to the
Director of Shareholder relations.
ALL SHAREHOLDERS ARE URGED TO COMPLETE, SIGN, AND RETURN THE
ACCOMPANYING PROXY IN THE ENCLOSED ENVELOPE.
BY ORDER OF THE BOARD OF DIRECTORS
/s/
Michael H. DeDomenico
Secretary
Dated: March 17, 1997
<PAGE>
EXHIBIT A
PROPOSED AMENDMENTS OF ARTICLES OF INCORPORATION
GREENLAND CORPORATION
Resolved, the Certificate of Incorporation of this Corporation be amended
such that the first sentence of the paragraph numbers Article V AUTHORIZED
SHARES so that as amended said sentence shall be read "The aggregate number
of shares which the Corporation shall have authority to issue as 50,000,000
shares, having a par value of $0.001 (1 mil) per share."
Resolved, the Certificate of Incorporation of this Corporation be amended
such that Article V - AUTHORIZED SHARES shall include the authorization for
the issuance of up to two classes of Preferred Stock (A and B); 10,000
shares for each class.
Be it further resolved that the par value of said Preferred stock shall be
determined at the discretion of the Board of Directors prior to issuance of
said shares and that such par value be entered into the Articles of
Incorporation after such determination.
