SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14C INFORMATION STATEMENT
Information Statement Pursuant to Section 14(c)
of the Securities Exchange Act of 1934
Check the appropriate box:
|X| Preliminary Information Statement
|_| Confidential, for Use of the Commission Only (as permitted by Rule
14c-5(d)(2))
|_| Definitive Information Statement
Ocean West Holding Corporation
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(Name of Registrant as Specified in its Charter)
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|X| No fee required.
|_| Fee computed on table below per Exchange Act Rules 14c-5(g)
and 0-11.
(1) Title of each class of securities to which investment
applies:
(2) Aggregate number of securities to which investment
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 fee is calculated and
state how it was determined):
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|_| Check box if any part of the fee is offset as provided by
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--------------------------------------------------------------------------------
OCEAN WEST HOLDING CORPORATION
26 Executive Park, Suite 250, Irvine, California 92614
INFORMATION STATEMENT
To the Stockholders of Ocean West Holding Corporation:
Ocean West Holding Corporation, a Delaware corporation (the "Company", "Ocean
West," "we", "us" or "our"), obtained the written consent of the holder of more
than a majority of our issued and outstanding shares of common stock (the
"Common Stock") on March 4, 2005, to (i) change our name to AskMeNow, Inc., (ii)
increase our authorized common stock to 100,000,000 shares and (iii) eliminate
from the Certificate of Incorporation of the Company the provisions allowing
cumulative voting, all of which are contained in the form of Amended and
Restated Certificate of Incorporation attached hereto as Appendix A. In
addition, the Board of Directors of the Company approved the spin-off of our
operating subsidiary Ocean West Enterprises, Inc. (the "Subsidiary") which did
not require shareholder approval, however, is required to be described in this
Information Statement.
The increase in authorized shares of Common Stock is not necessary to complete
the transactions outlined in this Information Statement. Such increase in being
made solely to assure the availability of common stock for future transactions.
The foregoing proposals were approved by our Board of Directors as of March 4,
2005, and by the holder of more than a majority of our issued and outstanding
shares of Common Stock in connection with the Securities Exchange Agreement and
Plan of Reorganization, dated as of April 14, 2005 (the "Exchange Agreement"),
by and among, the Company, InfoByPhone, Inc., a Delaware corporation ("IBP"),
and the stockholders of IBP, a copy of which is attached hereto as Appendix B.
Pursuant to the Exchange Agreement and effective June 6, 2005, the Company
acquired IBP, a Delaware corporation, in a reverse merger pursuant to which IBP
became a wholly-owned subsidiary of the Company, as (i) the Company acquired all
of the issued and outstanding shares of IBP in exchange for 6,000,000 shares of
authorized, but unissued, shares of common stock of the Company, par value $.01,
which, together with 500,000 shares issued to Vertical Capital Partners
("Vertical") as a finder's fee, constituted in excess of 50% of the capital
stock of the Company, (ii) the existing directors of the Company, Marshall
Stewart and Daryl Meddings, agreed to resign 10 days after the mailing of the
Company's Schedule 14f-1, and resigned on July 18, 2005, and the two director
designees of IBP joined the Company (the "Designated Directors"), (iii) the
existing officers of the Company resigned and were replaced by the officers of
IBP, (iv) neither IBP nor the Company had any debt or liability, and IBP had no
less than $750,000 cash or cash equivalents and (v) the Company agreed to
spin-off (the "Spin-Off") Ocean West Enterprises ("OWE") to the Company's
stockholders of record as of May 23, 2005. In addition, the Company completed an
equity offering, on a best efforts basis for an aggregate minimum purchase
amount of 2,500,000 shares at $.30 per share of common stock, or an aggregate
minimum purchase price of $750,000, and the aggregate maximum purchase amount of
10,666,666 shares at $.30 per share of common stock, or an aggregate maximum
purchase price of $3,200,000, as amended (the "Offering"), all of which was
raised as of July 31, 2005. All of the foregoing is hereinafter referred to as
the "Transaction".
In connection with the Closing, we agreed to (i) cancel, redeem or otherwise
retire all outstanding preferred stock and Class B Common Stock, which has
occurred; (ii) file a Form 8-K with the SEC, which shall include financial
statements of IBP required to be filed with the SEC under the current rules for
such Form 8-K filings; (iii) spin out our sole operating company, Ocean West
Enterprises, along with all its assets and liabilities; and (iv) assist in
requesting a symbol change to "ASKM." Prior to the Closing, all officers,
directors and our majority shareholder voted to approve all the actions needed
to close the Transaction, including, but not limited to, those matters described
in this Information Statement.
As a result of the Transaction, a change of control of the Company occurred with
the existing stockholders of the Company being reduced from holding 100% of the
issued and outstanding shares of Common Stock to holding less than 50% of issued
and outstanding shares of Common Stock post Closing and an assumption of IBP's
assets, liabilities and operations. Prior to the closing of the Transaction, IBP
was a privately-held company.
Our purpose in changing our name to AskMeNow, Inc. increasing our authorized
capital, eliminating cumulative voting and describing the Spin-Off and OWE
pursuant to this Information Statement is to allow us to comply with the terms
of the Exchange Agreement. The actions taken to date pursuant to the Transaction
did not require shareholder approval.
Your consent is not required and is not being solicited in connection with this
action. The accompanying Information Statement is furnished only to inform you
of the action described above in accordance with Rule 14c-2 promulgated under
the Securities Exchange Act of 1934, as amended (the "Exchange Act"). This
Information Statement is being mailed to you on or about ________, 2005.
PLEASE NOTE THAT THE HOLDER OF A MAJORITY OF THE COMPANY'S COMMON STOCK PRIOR TO
THE CLOSING VOTED TO CHANGE THE NAME OF THE COMPANY TO ASKMEKNOW, INC., TO
INCREASE OUR AUTHORIZED CAPITAL AND TO ELIMINATE CUMULATIVE VOTING FROM THE
CERTIFICATE OF INCORPORATION. THE NUMBER OF VOTES HELD BY SUCH CONTROLLING
STOCKHOLDER WERE SUFFICIENT TO SATISFY THE STOCKHOLDER VOTE REQUIREMENT FOR
THESE ACTIONS AND NO ADDITIONAL VOTES WILL CONSEQUENTLY BE NEEDED TO APPROVE
THESE ACTIONS. PURSUANT TO SECTION 228 OF THE DELAWARE GENERAL CORPORATION LAW,
YOU ARE HEREBY BEING PROVIDED WITH NOTICE OF THE APPROVAL BY LESS THAN UNANIMOUS
WRITTEN CONSENT OF OUR STOCKHOLDERS OF THE AMENDMENTS TO OUR CERTIFICATE OF
INCORPORATION AND THE SPIN-OFF OF THE SUBSIDIARY.
By order of the Board of Directors,
Darryl Cohen
Chief Executive Officer
Irvine, California
November [ ], 2005
2
SUMMARY TERM SHEET
The summary term sheet contained in this Information Statement describes
the most material terms of the the reverse merger detailed in this Information
Statement, but might not contain all of the information that is important to
you. You are urged to read carefully this Information Statement, including the
appendices and the exhibits.
The Reverse Merger
o Written Consent
The Company obtained the written consent of the holder of more than a
majority of our issued and outstanding shares of common stock on March 4, 2005,
to:
o change our name to AskMeNow, Inc.;
o increase our authorized common stock (the "Common Stock") to
100,000,000 shares; and
o eliminate from the Certificate of Incorporation of the Company the
provisions allowing cumulative voting.
o Securities Exchange Agreement and Plan of Reorganization, dated April 14,
2005
Effective at the Closing of the Exchange Agreement, or shortly thereafter,
the Company acquired IBP, a Delaware corporation, in a reverse merger (see
"Board's Reasons for Engaging in the Transaction" for a more detailed
explanation of the reasons for the reverse merger), as:
o the Company acquired all of the issued and outstanding shares of IBP
in exchange for 6,000,000 shares of authorized, but unissued, shares
of common stock of the Company, par value $.01, which together with
500,000 shares issued to Vertical as a finder's fee constituted in
excess of 50% of the capital stock of the Company;
o The holders of all issued and outstanding shares of all series of
the Company's preferred stock, as well as Class B Common Stock,
surrendered all issued and outstanding shares of their stock to the
Company for no consideration and such shares were cancelled;
o IBP became a wholly-owned subsidiary of the Company;
o the existing directors of the Company, Marshall Stewart and Daryl
Meddings, agreed to resign 10 days after the mailing of the
Company's Schedule 14f-1, on July 18, 2005, and the two director
designees of IBP joined the Company (the "Designated Directors");
o the existing officers of the Company resigned and were replaced by
the officers of IBP;
o neither IBP nor the Company had any debt or liability, and IBP had
no less than $750,000 cash or cash equivalent; and
o the Company agreed to spin off OWE to the Company's stockholders of
record as of May 23, 2005. See "Actions To Be Taken Pursuant To This
Information Statement" for a mere detailed explanation).
o Private Equity Offering (for a more detailed description, see "Ocean West
Private Equity Offering")
o The Company completed an equity offering on a best efforts basis for
an aggregate minimum purchase amount of 2,500,000 shares at $.30 per
share of common stock, or an aggregate minimum purchase price of
$750,000, and the aggregate maximum purchase amount of 10,666,666
shares at $.30 per share of common stock, or an aggregate maximum
purchase price of $3,200,000, as amended (the "Offering"), all of
which was raised as of July 31, 2005.
o Thus, combining the 10,666,666 shares from the Offering and the
6,000,000 shares from the Exchange, ultimately, 16,666,666
restricted shares of Common Stock were issued and the Company has
agreed to register them all (see "Disclosure regarding Blank Check
Company Shares" section).
o There are approximately 25,733,280 shares of our Common Stock issued
and outstanding as of October 27, 2005.
3
TABLE OF CONTENTS
Page #
Summary Term Sheet ..........................................................3
General Information..........................................................5
Disclosure Regarding Blank Check Company Shares..............................7
The Boards' Reasons for Engaging in the Transaction..........................9
Voting Securities and Principal Holders Thereof..............................10
Directors and Executive Officers and Nominees for Directors..................11
Board Committees.............................................................13
Audit Committee Report.......................................................14
Section 16(a) Beneficial Ownership Reporting Compliance .....................14
Certain Relationships and Related Transactions ..............................14
Executive Compensation.......................................................15
Employment Agreements........................................................16
Compensation Committee Interlocks and Insider Participation..................17
Compensation Committee Report to Stockholders................................17
Audit and Non-Audit Fees.....................................................17
Financial Information........................................................17
Procedure for Approval of Action; Voting.....................................18
Effect on Certificates Evidencing Shares of Ocean West Holding Corporation...18
Exhibits.....................................................................18
Other Matters................................................................18
4
OCEAN WEST HOLDING CORPORATION
26 Executive Park, Suite 250, Irvine, California 92614
INFORMATION STATEMENT PURSUANT TO SECTION 14
OF THE SECURITIES EXCHANGE ACT OF 1934
AND REGULATION 14C AND SCHEDULE 14C THEREUNDER
REGARDING
ACTION TAKEN BY WRITTEN CONSENT OF A
MAJORITY OF STOCKHOLDERS
OCEAN WEST HOLDING CORPORATION., a Delaware corporation ("we", "us", "our"
"Ocean West" or the "Company"), is furnishing this Information Statement to you
to provide you with information and a description of actions taken by written
consent of our majority stockholder, on March 4, 2005, in accordance with the
relevant sections of the Delaware General Corporation Law. These actions were
taken by Consumer Direct of America, Inc. ("CDA"), which on March 4, 2005 owned
in excess of a majority of our outstanding common stock necessary for the
adoption of the actions.
THIS INFORMATION STATEMENT IS BEING MAILED ON OR ABOUT NOVEMBER __, 2005 TO
STOCKHOLDERS OF RECORD ON ____, 2005. THE INFORMATION STATEMENT IS BEING
DELIVERED ONLY TO INFORM YOU OF THE CORPORATE ACTIONS DESCRIBED HEREIN IN
ACCORDANCE WITH RULE 14C-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF
1934, AS AMENDED.
WE ARE NOT ASKING YOU FOR A PROXY AND YOU ARE REQUESTED NOT TO SEND US A PROXY.
We have asked brokers and other custodians, nominees and fiduciaries to forward
this Information Statement to the beneficial owners of the common stock held of
record by such persons and will reimburse such persons for out-of-pocket
expenses incurred in forwarding such material.
THIS IS NOT A NOTICE OF A MEETING OF STOCKHOLDERS AND NO STOCKHOLDERS' MEETING
WILL BE HELD TO CONSIDER ANY MATTER DESCRIBED HEREIN.
PLEASE NOTE THAT THE COMPANY'S CONTROLLING STOCKHOLDER HAS VOTED TO APPROVE THE
CHANGE OF THE CORPORATION'S NAME TO ASKMENOW, INC., INCREASE OUR AUTHORIZED
CAPITAL, AND ELIMINATE CUMULATIVE VOTING FROM THE CERTIFICATE OF INCORPORATION.
THE NUMBER OF VOTES HELD BY THE CONTROLLING STOCKHOLDER IS SUFFICIENT TO SATISFY
THE STOCKHOLDER VOTE REQUIREMENT PURSUANT TO THE DELAWARE GENERAL CORPORATION
LAW FOR SUCH ACTIONS AND NO ADDITIONAL VOTES WILL CONSEQUENTLY BE NEEDED TO
APPROVE THESE ACTIONS.
GENERAL INFORMATION
Ocean West Holding Corporation, a Delaware corporation (the "Company",
"we", "us" or "our"), has obtained the written consent of the holder of more
than a majority of our issued and outstanding shares of common stock on March 4,
2005, to (i) change our name to AskMeNow, Inc., (ii) increase our authorized
common stock (the "Common Stock") to 100,000,000 shares and (iii) eliminate from
the Certificate of Incorporation of the Company the provisions allowing
cumulative voting. In addition, the Board of Directors of the Company has
approved the proposed spin-off of our operating subsidiary Ocean West
Enterprises, Inc. ("OWE" or the "Subsidiary").
The foregoing proposals were approved by our Board of Directors as of
March 4, 2005, and by the holder of more than a majority of our issued and
outstanding shares of common stock in connection with the Securities Exchange
Agreement and Plan of Reorganization, dated as of April 14, 2005 (the "Exchange
Agreement"), by and among, the Company, InfoByPhone, Inc., a Delaware
corporation ("IBP"), and the stockholders of IBP.
The increase in authorized shares of common stock is not necessary to
complete the transactions outlined in the Information Statement. Such increase
in being made solely to assure the availability of Common Stock for future
transactions.
The Transaction
The closing of the Exchange Agreement occurred on June 6, 2005 (the
"Closing"). Effective at the Closing, or shortly thereafter, the Company
acquired IBP, a Delaware corporation, in a reverse merger pursuant to which IBP
became a wholly-owned subsidiary of the Company, as (i) the Company acquired all
of the issued and outstanding shares of IBP in exchange for 6,000,000 shares of
authorized, but unissued, shares of common stock of the Company, par value $.01,
which together with 500,000 shares issued to Vertical as a finder's fee
constituted in excess of 50% of the capital stock of the Company, (ii) the
existing directors of the Company, Marshall Stewart and Daryl Meddings, agreed
to resign 10 days after the mailing of the Company's Schedule 14f-1, on July 18,
2005, and the two director designees of IBP joined the Company (the "Designated
Directors"), (iii) the existing officers of the Company resigned and were
replaced by the officers of IBP, (iv) neither IBP nor the Company had any debt
or liability, and IBP had no less than $750,000 cash or cash equivalents and (v)
the Company agreed to spin off OWE to the Company's stockholders of record as of
May 23, 2005. In addition, the Company completed an equity offering (described
in greater detail below), on a best efforts basis for an aggregate minimum
purchase amount of 2,500,000 shares at $.30 per share of common stock, or an
aggregate minimum purchase price of $750,000, and the aggregate maximum purchase
amount of 10,666,666 shares at $.30 per share of common stock, or an aggregate
maximum purchase price of $3,200,000, as amended (the "Offering"), all of which
was raised as of July 31, 2005. The aggregate maximum purchase amount was
initially 6,666,666 shares but this number increased to 10,666,666 shares. Thus,
combining the 10,666,666 shares from the Offering and the 6,000,000 shares from
the Exchange, ultimately, 16,666,666 restricted shares of Common Stock were
issued and the Company has agreed to register them all (see "Disclosure
regarding Blank Check Company Shares" section). There are approximately
25,733,280 shares of our Common Stock issued and outstanding as of October 27,
2005. All of the foregoing is hereinafter referred to as the "Transaction."
Actions To Be Taken Pursuant To This Information Statement
While the Transaction closed and had immediate effect as of June 6, 2005,
the following events will not occur until 20 days have passed (the "Effective
Date") after this Information Statement has been mailed or delivered to the
Company's shareholders in compliance with Section 14(c) of the Exchange Act and
Schedule 14(c) promulgated thereunder:
A. The Company will file a Certificate of Amendment to its Certificate of
Incorporation in the form attached hereto as Appendix A to:
(i) change its name to AskMeNow, Inc.
(ii) increase its authorized Common Stock to 100,000,000 shares;
and
(iii) delete the provisions allowing cumulative voting.
B. Anticipated spin-off of Ocean West Enterprises:
The Subsidiary OWE will be spun-off to the Company's stockholders of
record as of May 23, 2005, pursuant to a dividend of 100% of the common stock of
OWE to the then holders of record of the Company's common stock. The Exchange
Agreement provided that only the then existing shareholders of the Company prior
to the Transaction were entitled to a dividend of OWE stock. Therefore, the May
23, 2005 date was chosen prior to completion of the Transaction on June 6, 2005.
Although the Spin-Off has been authorized and declared as of May 23, 2005, the
stock of OWE has not been distributed and will not be until the Effective Date.
Until such time, the securities of OWE will be held in escrow by a third party
custodian. As part of the Spin-Off, OWE assumed all liabilities of the Company
as of May 23, 2005. All of the officers and directors of OWE resigned from all
positions at the Company and no officer or director of the Company is part of
the management of OWE. Therefore, but for
6
the distribution of OWE stock, OWE and the Company have been completely
separated. As a result of the foregoing and pursuant to the Exchange Agreement,
InfoByPhone has become the sole operating business of the Company.
Prior to the completion of the Transaction, the sole business of the
Company was that of OWE. All information concerning OWE has been reported by the
Company in its periodic reports filed with the SEC. All of which documents are
set forth herein under "Exhibits" and accompany this Information Statement.
The information required to be included in the Information Statement
concerning OWE and the Spin-Off in accordance with Schedule 14A of the
Regulation 14A is either included in this Information Statement or accompanies
this Information Statement as an Exhibit and is being provided to Shareholders
as follows:
Voting Securities and Principal Holders Thereof: All of the capital stock
of OWE is owned by the Company. See Item 11 of Exhibit 3, the Company's Annual
Report on Form 10-KSB/A, Amendment No. 2 for September 30, 2004 ("Form 10-KSB")
for information concerning the ownership of the Company. The shareholders of the
Company, as of May 23, 2005, will receive 100% of the stock of OWE on a
one-for-one basis.
Directors and Executive Officers: See Exhibit 14, the Company's Schedule
14F-1/A, Amendment No. 3 ("Schedule 14F") and Item 9 of the Form 10-KSB.
Compensation of Directors and Executive Officers: See Schedule 14F and
Item 10 of Form 10-KSB.
Financial and Other Information: Although financial information concerning
OWE is not required in this Information Statement it is provided as part of Form
10-KSB; Exhibit 17, Form 10-QSB for December 31, 2004; Exhibit 15, Form 10-QSB
for March 31, 2005; Exhibit 4, Form 10-QSB for June 30, 2005, and Exhibit 6,
Form 8-K/A Amendment No. 2 for June 10, 2005.
Mergers, Consolidations, Acquisitions and Similar Matters: See information
contained in this Information Statement; Schedule 14F; Exhibit 13, Form 8-K
filed on June 9, 2005; Exhibit 12, Form 8-K/A filed on June 10, 2005 and Exhibit
6, 8-K/A, Amendment No. 2 for June 10, 2005.
Amendment of Charter, By-Laws or Loan Documents: See Appendix A to this
Information Statement as well as information contained herein.
Business of OWE: For a complete description of the business of OWE prior
to the Spin-Off. See Item 1. Business in the Form 10-KSB.
Pursuant to Section 10.12 of the Exchange Agreement, the Company agreed to
spin-off or sell, or enter agreements to spin-off or sell, any subsidiary (or
its assets), in a transaction in which the purchaser or transferee of such
subsidiaries shall indemnify and hold both the Company and the surviving
corporation harmless from any and all liabilities arising out of the business or
operations of such subsidiaries and/or the transaction transferring the
ownership thereof to a third party. The Company has been advised by Pioneer
Credit Recovery, Inc. ("Pioneer") that the U.S. Department of Treasury has
placed with Pioneer an account owed to it by OWE. The former principals of OWE
and the Company did not disclose to InforByPhone or current management that they
and OWE had guaranteed three HUD loans in the aggregate amount of $151,980. In
the event a claim is made against the Company by Pioneer, the U.S. government,
or any other party, the Company will seek indemnification from the former
principals of OWE and their affiliates.
As disclosed in Section 2.2 of the Exchange Agreement, while the parties
intend that the transactions under this Agreement qualify as a tax-free
re-organization under Section 368(a)(1)(B) of the Code, we do not represent that
the Transaction will, in fact, be tax-free and we have not issued a tax opinion
in that regard. A copy of the Exchange Agreement is attached hereto as Appendix
B. The foregoing description of the Transaction does not purport to be complete
and is qualified in its entirety by reference to the Exchange Agreement, which
is incorporated herein by reference.
7
Actions Already Completed
The following events have already occurred in connection with the
Transaction:
1. The Company acquired all of the issued and outstanding shares of IBP in
exchange for 6 million shares of Common Stock.
2. The holders of all issued and outstanding shares of all series of the
Company's preferred stock, as well as Class B Common Stock, surrendered all
issued and outstanding shares of their stock to the Company for no consideration
and such shares were cancelled.
3. Prior to the Closing of the Transaction, Marshall Stewart, President
and a director, and Daryl Meddings, a Secretary and a director and Wayne K.
Bailey, CFO, resigned from all positions as officers of the Company and agreed
to resign as members of the Board of Directors, effective when 10 days passed
from the mailing of the Company's Schedule 14f-1 which occurred on July 18,
2005. Darryl Cohen and Alan Smith were elected to the Board and Sandro Sordi was
appointed to the Board of Directors on July 19, 2005 and, together with Messrs.
Cohen and Smith now comprise the entire Board of Directors of the Company (the
"Designated Directors").
4. IBP became a wholly-owned subsidiary of the Company.
Ocean West Private Equity Offering.
On June 2, 2005, investors commenced to enter into Subscription Agreements
(the "Subscription Agreements") with the Company relating to the offering and
sale on a "best efforts basis" of a minimum of 2,500,000 shares ($750,000) and a
maximum of 10,666,666 shares ($3,200,000) of common stock of the Company, $0.001
par value per share ("Common Stock"), at $0.30 per share (the "Offering"), as
amended. As of July 14, 2005, we had accepted subscriptions for the maximum
gross proceeds of $3,200,000 pursuant to our Confidential Private Placement
Memorandum dated June 2, 2005 (the "Memorandum"). The Company received net
proceeds of approximately $2,784,000, after deducting fees payable to the
placement agent. The proceeds received in the Offering were first used to repay
approximately $100,000 of outstanding principal and accrued interest owed to
Allied International Fund. The remaining proceeds from the Offering are being
used for research and development, marketing and for working capital and general
corporate uses. The Company may also use proceeds from the Offering to fund its
acquisition of new products.
DISCLOSURE REGARDING BLANK CHECK COMPANY SHARES
The Exchange Agreement initially created a "blank check company." Because
the SEC has taken the position that promoters or affiliates of a blank check
company and their transferees would act as "underwriters" under the Securities
Act when reselling the securities of the blank check company, the shares held by
such persons can only be resold through a registered offering under the
Securities Act. Rule 144 is not available for resale transactions in this
situation because such resale transactions appear to be designed to distribute
securities to the public without compliance with the registration requirements
of the Securities Act. Thus, the shares of the Company held by the
pre-Transaction affiliates and their transferees cannot be sold without a
registration statement. No shareholder known to the Company to be an affiliate
at the time of the Transaction has publicly sold any securities of the Company,
nor will they be permitted to do so without registration.
The following table based on information provided by the Company's
transfer agent, lists both the pre-Transaction and post-Transaction affiliates
of the Company and the number of shares each holds in the Company:
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------------------
Name of Affiliate Total Number of Securities Owned Beneficially
-----------------------------------------------------------------------------------------------------------------
<S> <C>
Wayne K. Bailey 0
-----------------------------------------------------------------------------------------------------------------
Daryl S. Meddings 0
-----------------------------------------------------------------------------------------------------------------
Marshall L. Stewart 0
-----------------------------------------------------------------------------------------------------------------
Darryl Cohen 1,025,667
-----------------------------------------------------------------------------------------------------------------
Alan Smith 25,000
-----------------------------------------------------------------------------------------------------------------
</TABLE>
8
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------------------
<S> <C>
Sandro Sordi 758,334
-----------------------------------------------------------------------------------------------------------------
Global Asset Management, LLC 751,000
-----------------------------------------------------------------------------------------------------------------
Vertical Capital Partners, Inc. 395,000
-----------------------------------------------------------------------------------------------------------------
Consumer Direct of America 0
-----------------------------------------------------------------------------------------------------------------
</TABLE>
Messrs Darryl Cohen, Sandro Sordi and Alan Smith officers and/or directors
of the Company were not affiliates of the issuer at the time of the Transaction,
nor were Vertical Capital Partners and Global Asset Management ("Global"), an
affiliate of Vertical. Each of these five affiliates, have confirmed to the
Company that their shares bear a restrictive legend and will not be sold except
pursuant to a registration statement. The shares of the Company issued to
Vertical and Global have been included in the Company's Registration Statement
on Form SB-2 first filed on September 14, 2005.
Background of the Transaction.
As previously discussed, in April 2005, Ocean West entered into the
Exchange Agreement with IBP. The Transaction arose on or about April 1, 2005,
when Mr. Robert DePalo, a principal of Vertical, which initially acted as a
finder in the Transaction and then as the Company's Placement Agent, was
contacted by Mr. Darryl Cohen, Chief Executive Officer of IBP. Mr. Cohen
indicated a desire to effect a reverse merger of IBP with a public company that
would spin-off its operating business. In April 2005, Vertical introduced IBP to
Ocean West. A registered representative at Vertical had a long-existing
relationship with CDA. IBP commenced negotiations directly with officers and
directors of OWHC. IBP was represented by its attorneys, and Ocean West was
represented by counsel for CDA, the majority shareholder of Ocean West. There
were no other individuals or professionals involved in the negotiations. The
Exchange Agreement was closed on June 6, 2005.
Ocean West is a publicly-held company subject to the reporting
requirements of the Exchange Act. Its common stock is quoted on the
Over-the-Counter Bulletin Board (OTCBB), under the symbol "OWHC.OB." Ocean West
is a holding company which holds all of the issued and outstanding stock of OWE.
OWE is a retail mortgage banking company primarily engaged in the business of
originating and selling loans secured by real property with one to four units.
Under the Exchange Agreement, OWE will be "spun-off" so that the only business
conducted by Ocean West will be the business of IBP.
INFOBYPHONE
InfoByPhone, Inc., now a wholly-owned subsidiary of the Company, is a
development stage communications technology company that provides users of
handheld cellular devices with access to information regardless of location
through its AskMeNow(TM) Service (the "Service"). The Service is a new mobile
information content service users of any mobile device with text messaging/SMS
or email capability, to call email, or text message (SMS) in questions. An
answer is then text messaged or e-mailed back to the consumer's mobile device,
usually within a matter of minutes.
The Service is accessible anytime and anywhere, through every possible way
that wireless technology allows people to communicate via a mobile device. Using
proprietary software and proprietary methods to access third party databases the
Service has the research capability to answer virtually any information-based
question, including current news and events, sports scores, historical
statistics, weather, entertainment, stock quotes and market data, driving
directions, travel schedules and availabilities, emergency disaster information,
comparison shopping, restaurant information and reservations, directory
assistance, and random trivia (literature, history, science, etc.). Once
information is accessed from third party strategic partners, it is refined to a
format suitable for easy reading on the screen of user's mobile device and
quickly emailed or text messaged back to the user. IBP is now positioned to
fully commercialize its technology.
9
IBP expects to launch this product from beta in the Fall of 2005. The
release will be primarily to cell phone users in the U.S. and Canada. IBP will
utilize a national marketing program via a television commercial that will run
on local cable networks in the top 100 markets in the U.S. The product is
expected to generate revenues through fees generated from advertisers utilizing
our ad space to promote products and by charging customers that ask questions
that are not able to be asked in our Template Formats. IBP also expects to
generate revenue from affiliate partnerships whereby our customers purchase ring
tones, wallpaper, games and other items.
THE BOARDS' REASONS FOR ENGAGING IN THE TRANSACTION
The Boards of Directors of both Ocean West and IBP each believed that
their respective objectives will be achieved with a combined company. Ocean West
believed that the IBP acquisition would provide its stockholders with a far
better investment opportunity than its existing Enterprises subsidiary. IBP
desired to employ a public vehicle for the reasons stated below. The Transaction
is intended to provide IBP with all of its perceived advantages of being a
publicly held corporation, as described below.
Ocean West's Reasons for the Merger
The Board of Directors of Ocean West approved the reverse merger following
its review of various alternatives for enhancing the overall return to its
stockholders, advancing its financial and strategic objectives and giving Ocean
West the flexibility it needed for future growth. In the course of reaching its
decision to approve the merger, the Board consulted with all of Ocean West's
legal and financial advisors. After exploring all of the alternatives presented
to Ocean West during the course of the last several years, including numerous
business plans and various proposed merger partners, the Board of Directors
voted and unanimously decided on April 14, 2005, that the Transaction had the
most merit and represented the best strategic alternative for addressing the
challenges and opportunities facing the Company. The rationale for this decision
was based on a careful examination of the material factors described in greater
detail below.
The Board of Directors conducted an extensive cost-benefit analysis and
unanimously concluded that the business of Ocean West Enterprises ("OWE") was
better off as a private company than as a public company. This analysis revealed
that there was virtually no benefit, with tremendous expenses to OWE in being a
public company. The Board could not find any potential benefits to OWE remaining
a public company, because there was no interest in anyone funding Ocean West as
a public company. The reasons why OWE could not obtain funding was because of
the mortgage business it is in and the fact that there was no trading in the
Ocean West stock and most importantly, there was not even a market for the Ocean
West stock. Yet at the same time, the Board knew that the Company faced huge
expenses as a public company. It would have to comply with the Sarbanes-Oxley
Rule 404 internal controls and procedures compliance deadline by July 2006 (now
2007) and it had not yet made any progress in that regard. Thus, OWE weighed the
costs of being a public company which were significantly increasing against the
fact is was not receiving any of the benefits of being a public company.
Another factor the Board considered was the acceptance of the Ocean West
stockholders of the Transaction. The prior controlling shareholders of Ocean
West felt confident that the stock position of the Company would increase faster
via a merger with IBP than with any other company they had previously reviewed.
The business plan submitted by IBP was close to commercialization and IBP had
represented that it would launch its product by the end of 2005. For that
reason, the Stock Exchange Agreement was conditioned upon IBP having at least
$750,000 in cash at Closing to be raised via the minimum of a private placement
of the Company's securities. In that manner, IBP would be certain it could start
its launch of the product while the offering continued to raise the maximum
amount of money in the Offering or any subsequent financing could occur. This
was sufficient justification for the Board to present to the Ocean West
shareholders even though IBP had not yet commenced operations. Moreoever, as
mentioned above, when Vertical introduced IBP to Ocean West, a registered
representative at Vertical already had a long-existing relationship with CDA.
Vertical was able to introduce Ocean West to persons who had strong industry
contacts, especially the controlling shareholders of CDA, that created a
powerful synergy and that presented various opportunities for IBP to network
with representatives of Ocean West. This made the merger with IBP appear even
more promising to Mr. Cohen. In addition to the money and resources provided,
the merger would more quickly enable Ocean West to hire more talented, qualified
personnel in time for the launch of their product. If they had had to wait for
an underwritten IPO, the Company wouldn't have been able to hire such talent so
quickly.
10
The Board of Directors also reviewed the prior experience of Darryl Cohen
and the record of his numerous businesses and decided that he was the most
qualified CEO they had met to date. The Board was anxious to harness Mr. Cohen's
expertise to carryout the business plan for the merged company. Furthermore, the
Board knew that it would be critical for its shareholders to see their
investment appreciate for IBP to quickly assemble a strong and talented
management team. The credentials of Mr. Cohen and the IBP business plan
represented there would be an instant talent pool. Therefore, although IBP had
not commenced commercial operations, the Board of Directors believed IBP
provided the Company with a relatively fast return on investment.
Another factor the board considered was the independence of the
transaction. The Board strongly favored the merger transaction because it was
not a related party transaction. Arms-length negotiations were conducted between
principals and counsel for both sides. See "Background of the Transaction"
above. Although the Company was giving up its control, no valuation was
necessary since the Company's shareholders were keeping the OWE business plus
their stock in Ocean West. The fact that the Ocean West shareholders would keep
its own business in and of itself was another strong factor in favor of the
reverse merger. In view, of the foregoing, the transaction did not require a
fairness opinion.
The Board considered all of these factors at length and unanimously
decided that the merger was beneficial to the growth and commercialization of
the Company.
IBP's Reasons for the Merger
IBP also viewed the reverse merger with Ocean West as its best
opportunity. The Board of Directors of IBP believed that a reverse merger with a
public shell, rather than an underwritten public offering was the best
alternative for IBP. There was absolutely no certainty that a traditional
underwritten initial public offering would have been completed in time, if at
all. Even if it was completed, an underwritten offering would have taken too
much time for IBP and would not have given IBP the flexibility it needed to
raise capital. IBP needed to be absolutely certain that it had sufficient funds
on hand to launch its product on time before the end of 2005, and that there
would be ample access to the public market after becoming a public company. Once
the Company raised the minimum amount of the Offering of $750,000, it would have
sufficient funds to commence the launch. Once the offering was completed and
Ocean West was filing periodic reports, there was total transparency. Anyone
could then invest in the Company at any time, making it much easier for Ocean
West to raise funds. The Board knew that this would give Ocean West the
flexibility it needed to grow its business. IBP knew that this would be
important in enabling IBP to grow the company internally and/or in acquiring
other companies. IBP has already gained immediate access to greater financial
resources, including access to the public markets. Access to private investors
has also improved, as evidenced by the above-described equity offering and by
private investors knowing that IBP is subject to the SEC's periodic reporting
requirements.
In addition, the Board of IBP believed that being part of a public
company should allow IBP to continue to attract additional strategic partners
from both a business and financial view. The Board of IBP believed that through
the reverse merger process and the various persons involved, in addition to
raising money for IBP, it would provide IBP with the opportunity to meet various
people who could assist the Company in its launch of the product. Beginning in
April 2005, when the parties were first introduced, and continuing to date, all
parties engaged in the Transaction have introduced IBP to various strategic
partners and vendors of services to a public company.
VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
After giving effect to the Exchange and the Offering, there were
25,733,280 shares of our Common Stock issued and outstanding after giving effect
to the issuance of 6,000,000 shares of Common Stock to the former IBP
shareholders, 500,000 shares to Vertical as a finder's fee, an additional
1,066,710 shares issued to Vertical as placement agent as a sales commission and
1,500,000 shares pursuant to option grants to consultants. As of November 2,
2005, (i) 2,000,000 shares of Common Stock were reserved for issuance under the
Company's 2005 Management and Director Equity Incentive Compensation Plan of
which 1,877,000 options had been granted, and (ii) no shares of our Common Stock
were reserved for issuance pursuant to other securities exercisable for, or
11
convertible into or exchangeable for, shares of our Common Stock. Each holder of
our Common Stock is entitled to cast one vote, in person or by proxy, for each
share of our Common Stock held by such holder. Because of the surrender of our
outstanding preferred stock and Class B common stock to the Company upon the
Closing of the Transaction, our Common Stock is the only capital stock
outstanding.
The following table sets forth information with respect to our Class A
common stock, par value $0.001 per share, owned on October 27, 2005 by each
person who beneficially owns more than five percent (5%) of our outstanding
Class A common stock, by each of our executive officers and directors at the
time of the Exchange and presently, and by all of our executive officers and
directors as a group.
<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------------------
Total Number of
Securities Owned Percent of
Name of Beneficial Owner Title of Class Beneficially Class (1)
----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Daryl S. Meddings (2)(3) Common Shares 0 -
----------------------------------------------------------------------------------------------------------------------
Marshall L. Stewart (2)(3) Common Shares 0 -
----------------------------------------------------------------------------------------------------------------------
Darryl Cohen(4)(5) Common Shares 1,025,667 4.0%
----------------------------------------------------------------------------------------------------------------------
Alan Smith(5) Common Shares 25,000(6) -
----------------------------------------------------------------------------------------------------------------------
Sandro Sordi(5) Common Shares 758,334(6) 2.9%
----------------------------------------------------------------------------------------------------------------------
Global Asset Management, LLC(7)(8) Common Shares 751,000 2.9%
----------------------------------------------------------------------------------------------------------------------
Vertical Capital Partners, Inc.(8) Common Shares 395,000 1.5%
----------------------------------------------------------------------------------------------------------------------
Total number of shares owned by directors Common Shares 1,809,001 7.0%
and executive officers as a group(2
persons)
----------------------------------------------------------------------------------------------------------------------
</TABLE>
--------------------
(1) Except as otherwise noted in the footnotes to this table, the named person
owns directly and exercises sole voting and investment power over the
shares listed as beneficially owned by such person. Includes any
securities that such person has the right to acquire within sixty days
pursuant to options, warrants, conversion privileges or other rights.
(2) The mailing address of such person shown is 15991 Redhill Avenue, Tustin,
California 92780.
(3) Information set forth as to prior management is as of March 4, 2005, prior
to the execution of the Exchange Agreement.
(4) Includes 50,000 shares of common stock issuable under currently
exercisable options, but does not include 150,000 shares of common stock
issuable under options not currently exercisable and 20,000 shares
underlying warrants exercisable at $2.00 per share to be issued pursuant
to the Exchange Agreement. These shares are held in the name of "Darryl
Cohen & Nini Cohen, TTEE, The Cohen Family Trust."
(5) The mailing address of each person shown is c/o Ocean West Holding
Corporation, 26 Executive Park, Suite 250, Irvine, CA.
(6) Includes 25,000 shares of common stock issuable under currently
exercisable options, but does not include 15,000 shares of common stock
issuable under options not currently exercisable.
(7) Does not include 500,000 shares issued to Vertical, of which Robert
Fallah, Manager of Global Asset Management, LLC, is a shareholder and a
director.
(8) The mailing address of each entity shown is 488 Madison Avenue, 8th Floor,
New York, NY, 10022.
12
Change In Control
Pursuant to the terms and conditions of the Exchange Agreement, upon the
Closing, the stockholders of IBP exchanged their interest therein for shares of
our Common Stock, as a result of which IBP has become our wholly-owned
subsidiary. As a result of the Transaction, a change of control of the Company
occurred with the existing stockholders of the Company being reduced from
holding 100% of the issued and outstanding shares of Common Stock to holding
less than 50% of the issued and outstanding shares of Common Stock post closing.
As of the Closing, CDA is no longer a 5% shareholder of the Company.
Due to the issuance of the shares of our Common Stock and the change in
our officers, which occurred at the Closing, a change in control of the Company
occurred.
DIRECTORS AND EXECUTIVE OFFICERS AND NOMINEES FOR DIRECTORS
Executive Officers and Directors of Ocean West at time of the Exchange
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------------------------------
Name Position with Ocean West (1) Position with Ocean West Enterprises
--------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Marshall L. Stewart President, Chief Executive Officer, President, Chief Executive Officer,
Director Director
--------------------------------------------------------------------------------------------------------------------
Daryl S. Meddings Executive Vice President, Executive Vice President, Chief
Secretary/Treasurer, Director Financial Officer, Secretary/Treasurer,
Director
--------------------------------------------------------------------------------------------------------------------
Wayne K. Bailey Chief Financial Officer, Director None
--------------------------------------------------------------------------------------------------------------------
</TABLE>
-------------------------
(1) All persons listed were appointed to such positions in 2000, except for
Mr. Bailey who was appointed in September of 2004.
Marshall J. Stewart, 47, has worked in the mortgage industry since 1982.
He was founder of Ocean West Enterprises, a wholly-owned subsidiary of the
Company and has been President, a director and a shareholder of both the Company
and the Subsidiary since 1988 until he sold his shares in exchange for shares in
CDA on July 15, 2004. Prior to founding Ocean West Enterprises, from 1986 to
1988, Mr. Stewart was a Vice President of Westport Savings Bank in Laguna Beach,
California. His responsibilities included overseeing the mortgage banking
department, secondary marketing and the Laguna Bank Savings branch. Prior to
joining Westport Savings Bank, from 1984 to 1986, he was Production Manager of
Irvine City Savings in Newport Beach, California and had the responsibilities of
staffing and training the loan origination department and overseeing production,
underwriting, funding, shipping and the sale of funded loans to institutional
investors such as FNMA and FHLMC. Mr. Stewart received his B.A. in English with
a minor in Business Administration from California State University in
Fullerton, California in 1980.
Daryl S. Meddings, 39, was also a founder of Ocean West Enterprises and
has been Executive Vice President, Chief Financial Officer, Secretary/Treasurer
and a director and a shareholder of both the Company and the Subsidiary since
1988 until he sold his shares in exchange for shares in CDA on July 15, 2004. As
Chief Financial Officer at Ocean West Enterprises, Mr. Meddings implemented and
monitors accounting and financial reporting systems. Other duties include budget
planning, expense control, commercial banking relationships and oversight of
quality control, loan servicing and loss mitigation. From late 1987 to 1988, Mr.
Meddings was a production manager with Westport Savings Bank in Laguna Beach,
California. His duties included establishing both retail and wholesale
production departments and recruiting, hiring and training mortgage origination
personnel. Prior to that, he began his career in mortgage banking in 1986 as a
loan officer at Pro Mortgage Services in Diamond Bar, California and worked his
way up to top producer at Irvine City Savings in Irvine, California. Mr.
Meddings received his B.S. in Finance, Real Estate and Insurance with a
concentration in Real Estate from California Polytechnic State University-Pomona
in 1987.
13
Wayne K. Bailey, 55, held the position of Chief Financial Officer and
Director of the Company since September 28, 2004. Mr. Bailey currently holds the
position of CFO of CDA since the fall of 2002. From January 1990 to the fall of
2002 he was Chief Operating Officer and Chief Financial Officer of a network of
companies in the aerospace, steel processing, specialty rebar, and metal forming
industries. These companies grew to employ over 350 people with revenues in
excess of $35 million. These companies were acquired from financially troubled
situations and became very profitable after being restructured. This
restructuring included the debt both secured and unsecured, installing
information systems, and management systems. During this time Mr. Bailey also
served as a consultant to companies in the Mortgage business, wood laminating,
bottled water, bookbinding, wholesale siding, cabinet manufacturing and plastics
industries. Mr. Bailey attended the University of Utah, Henager College of
Business and LDS Business College earning degrees in Accounting and Business.
Executive Officers and Director Nominees Commencing at the Closing
None of our existing officers, directors of employees continued as such
following the Closing of the Transaction. Following the Closing of the
Transaction, the IBP executive officers, directors and director nominees became
the executive officers, directors and director nominees as listed below. The
election of Mr. Cohen and Mr. Smith as directors became effective immediately.
The election of Mr. Sordi became effective on July 18, 2005, the eleventh day
after mailing of a separate Information Statement in accordance with Section
14(f) of the Securities Exchange Act of 1934, as amended, and Rule 14f-1 under
the Exchange Act. The following are the existing IBP executive officers,
directors and director-nominees and their respective ages and positions as of
the date hereof:
<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------
Names Ages Position
------------------------------------------------------------------------------------------------------
<S> <C> <C>
Darryl Cohen 53 Chairman, Chief Executive Officer and Director
------------------------------------------------------------------------------------------------------
Alan Smith 52 Director
------------------------------------------------------------------------------------------------------
Sandro Sordi 45 Director
------------------------------------------------------------------------------------------------------
</TABLE>
Darryl Cohen (53) Mr. Cohen has been Chairman, Chief Executive Officer and
a Director of the Company since June 2005 and of IBP since September 2004. Prior
to that, Darryl Cohen served as chairman and chief executive officer of Ramp
Corp. (RCO-Amex), a company that through its wholly-owned subsidiaries provides
Internet-based communication, data integration, and transaction processing
technologies designed to provide access to safer and better healthcare from
September 2002 through April 2004.
Prior to becoming Ramp's chairman and chief executive officer in September
2002, Cohen invested in public and private companies, frequently working with
management in the areas of marketing strategy and financing. Before that, he was
president of DCNL Incorporated, a privately held beauty supply manufacturer and
distributor he founded in 1988 and sold to Helen of Troy in 1998. During his
tenure as president of DCNL, Cohen was also co-owner and president of Basics
Beauty Supply Stores, a chain of retail stores in California, from 1985 -1999.
He has also owned businesses in the food-services and gift industries, and holds
a BA in Political Science from the University of California at Berkeley.
Alan Smith (52) Mr. Smith has been a director of the Company since June
2005 and of IBP since April, 2005. For the past two years, Mr. Smith has been
involved in personal investments and new investment opportunities. Prior to this
period, he was the owner/president of Aaron Kamhi Inc., an apparel manufacturing
company specializing in private label products for chain and department stores.
Mr. Smith worked at Aaron Kamhi, Inc. for 25 years. He was involved in all
aspects of the business. Mr. Smith has been actively involved in community
programs working with youth for the past 20 years.
Sandro Sordi (45) Mr. Sordi became a director of the Company on July 19,
2005. He currently serves as the General Counsel for the RS Group of Companies,
Inc., a holding company for a group of insurance and finance related businesses
and affinity program managers. Mr. Sordi joined the RS Group in 2003 where, as
its General Counsel and a Director, he has a taken leading role in developing
the company's growth strategy and engaging in negotiations of all types. Prior
thereto Mr. Sordi was engaged in the private practice of law. Mr. Sordi has been
a member of the Florida Bar since 1990, having earned his Juris Doctor from the
University of Miami, Florida and his B.A. (Honors) from York University in
Toronto, Canada. After admission to the bar, from 1990 through 2002, Mr. Sordi
practiced law exclusively as a sole practitioner in addition to being involved
in certain investment projects.
14
BOARD COMMITTEES
Currently, our Board of Directors has no separate audit, nominating and
corporate governance or compensation committees and acts as such as an entire
board. The audit committee, a nominating and corporate governance committee and
compensation committee are expected to be put in place by the end of the year.
It is anticipated that Messrs. Alan Smith will be members of the audit
committee, Sandro Sordi will be the member of the nominating and corporate
governance committee and Messrs. Darryl Cohen and Sandro Sordi will be the
members of the compensation committee.
Once the nominating and corporate governance committee is in place, the
Company will have a formal process in place to comply with Item 7(h) of Schedule
14A, or any successor provision thereto. Security holder communications will be
initially screened by the Company's nominating and corporate governance
committee (the "Committee") to determine whether they will be relayed to Board
members. This Committee will also determine whether to seek the approval of such
Item 7(h) policy by the independent Board members or not, as described in the
instructions to Item 7(h)(2)(ii) of Schedule 14A, or any successor provision
thereto. Once the decision has been made to relay such communications to Board
members, the Committee will release the communication to the Board on the next
business day.
AUDIT COMMITTEE REPORT
We will issue such report once the audit committee is formed.
Code of Ethics
We have adopted a Code of Ethics designed to comply with Item 406 of
Regulation S-B. The Code of Ethics is available on our website, at
www.askmenow.com or available in print upon request addressed to the Company's
Secretary, at the Company's corporate offices at Ocean West Holding Corporation,
26 Executive Park, Suite 250, Irvine, California 92614, or telephone at [(772)
492-0104].
Meetings of the Board of Directors and its Committees
During the year ended December 31, 2004, our board of directors took
action by written consent on five occasions. During the period from January 1,
2005 through the date of the Closing, our board of directors took action by
written consent on five occasions.
Director Compensation
Our directors who are officers or employees of the Company are not
compensated for service on our Board of Directors or any committee thereof. By
the end of the year, the Compensation Committee will determine our policy
regarding compensation for our directors who are not officers or employees
serving on our board of directors. We reimburse our directors for their
reasonable expenses incurred in attending meetings of our board.
Stockholder Communications with Directors
The Board of Directors welcomes communications from the Company's
stockholders. Any stockholder may communicate with either the Board as a whole,
or with any individual director, by sending a written communication c/o the
Company's Corporate Secretary at the Company's offices. All such communications
sent to the Company's Corporate Secretary must state the name of the
communicating stockholder and the number of shares beneficially owned; and will
be forwarded to the Board, as a whole, or to the individual director to whom
such communication was addressed.
15
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires
our directors, officers and persons who beneficially own more than 10% of the
shares of our Common Stock (each, a "Reporting Person") to file reports of
ownership and changes of ownership with the SEC. Copies of all filed reports are
required to be furnished to the company pursuant to the Exchange Act. Based
solely upon a review of the forms and amendments thereto furnished to the
Company during the year ended December 31, 2004, we believe that each Reporting
Person complied with all applicable filing requirements during such fiscal year
and current management has no knowledge of late filings by prior management.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
On July 15, 2004, Marshall L. Stewart, Daryl S. Meddings, Enfo Loan
Corporation, Kingsley and Nancy Cannon and Dale and Suzanne Delmege agreed to
sell 4,921,930 of their shares of Common Stock of the Company to CDA in exchange
for 622,388 shares of CDA (the "Transfer") for an approximate value of
$1,178,802, based on the average trading prices of the respective stocks for the
month of June 2004. The Transfer constituted a change in control of the Company.
See "Executive Compensation" - below for information on stock options and
an employment agreement entered into by the Company in 2005.
EXECUTIVE COMPENSATION
Summary Compensation Table
The following table sets forth the compensation of the President (the
Chief Executive Officer), the Executive Vice President and the Chief Financial
Officer paid by the Subsidiary for the year ended September 30, 2004, the year
ended September 30, 2003, the six-month period ended September 30, 2002 and the
fiscal year ended March 31, 2002.
<TABLE>
<CAPTION>
Long-Term
Shares
Underlying Other Annual
Name Year Salary ($) Bonus($) Awards Options Compensation($)
---------------------------------------- ------------- ------------ ------------ -------- -------------- ---------------
<S> <C> <C> <C> <C> <C> <C> <C>
Marshall L. Stewart 9/30/2004 $ 180,000 0 0 0 0
President, Chief Executive Officer 9/30/2003 170,000 0 0 0 0
9/30/2002 84,375 0 0 0 24,988
3/31/2002 180,000 0 0 0 0
Daryl S. Meddings 9/30/2004 $ 180,000 0 0 0 0
Executive Vice President and 9/30/2003 170,000 0 0 0 44,779
Chief Financial Officer 9/30/2002 77,133 0 0 0 3,575
3/31/2002 180,000 0 0 0 0
Wayne K. Bailey 9/30/2004 0 0 0 0 0
Chief Financial Officer 9/30/2003 0 0 0 0 0
of Parent Ocean West Holding Corp. 9/30/2002 0 0 0 0 0
3/31/2002 0 0 0 0 0
</TABLE>
Options/Sar Grants in Last Fiscal Year
No stock options were granted to the Named Executive Officers during 2004.
Long Term Incentive Plans - Awards In The Last Fiscal Year
16
The following table summarizes for each Named Executive Officer each award
under any long term incentive plan for the year ended September 30, 2004:
<TABLE>
<CAPTION>
Estimated Future Payouts under non-stock price based plans
Performance or
Number of other period
Name hares, units or until maturation Threshold Maximum
other rights or payout ($ or #) Target ($ or #) ($ or #)
--------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
None
</TABLE>
2005 Management and Director Equity Incentive and Compensation Plan
The Company has adopted the 2005 Management and Director Equity Incentive
and Compensation Plan (the "2005 Plan") in order to motivate participants by
means of stock options and restricted shares to achieve the Company's long-term
performance goals and enable our employees, officers, directors and consultants
to participate in our long term growth and financial success. The 2005 Plan
provides for the grant of any combination of stock options to purchase shares of
Common Stock or restricted stock to our directors, officers, employees and
consultants and those of our subsidiaries. The 2005 Plan which is administered
by our Board of Directors, authorizes the issuance of a maximum of 2,000,000
shares of Common Stock, which may be authorized and unissued shares or treasury
shares. The stock options granted under the 2005 Plan shall be either incentive
stock options, within the meaning of Section 422 of the Internal Revenue Code
("ISO's"), or non-qualified stock options ("NQSO's"). Both incentive stock
options and non-qualified stock options must be granted at an exercise price of
not less than the fair market value of shares of Common Stock at the time the
option is granted and incentive stock options granted to 10% or greater
stockholders must be granted at an exercise price of not less than 110% of the
fair market value of the shares on the date of grant. If any award under the
2005 Plan terminates, expires unexercised, or is cancelled, the shares of Common
Stock that would otherwise have been issuable pursuant thereto will be available
for issuance pursuant to the grant of new awards. The 2005 Plan will terminate
on June 6, 2015.
On July 19, 2005, the Board of Directors granted Alan Smith and Sandro
Sordi, the two independent members of the Board of Directors, options to each
purchase 40,000 shares of Common Stock. These non-qualified stock options are
exercisable for 10 years commencing on July 20, 2005 at $.70 per share, with
25,000 shares vested immediately for prior services and an additional 5,000
shares vested each four months from July 19, 2005 until fully vested 12 months
later.
On July 20, 2005, the Board of Directors granted Darryl Cohen an option
under his employment contract to purchase 200,000 shares of Common stock
exercisable for up to 10 years at $.70 per share. Fifty (50,000) thousand shares
vested immediately and 50,000 shares will vest every 90 days thereafter for 9
months.
In addition, options to purchase an aggregate of 1,597,000 shares of
Common Stock have been granted to 26 non-officer employees as of November 1,
2005.
EMPLOYMENT AGREEMENTS
On July 19, 2005, IBP, our wholly-owned subsidiary, entered into a
three-year employment contract with Darryl Cohen as President and Chief
Executive Officer. Mr. Cohen is being compensated at the rate of not less than
$110,000. Mr. Cohen was granted options to purchase 200,000 shares of Common
Stock at $.70 per share under his employment agreement. Mr. Cohen is entitled to
an annual incentive bonus at each anniversary date of his agreement equal to (i)
up to one-half of his then salary, plus (ii) up to 50,000 options and at the end
of each 90 day period of employment (except that period coinciding with an
anniversary date) up to 25,000 options.
In the event Mr. Cohen's employment is terminated for death, disability or
for Good Reason (as defined) Mr. Cohen or his estate shall be entitled to
severance of 50% of his base salary plus bonuses for the prior year. During the
term of his Agreement, or if terminated for cause (as defined) for the balance
of the term and for a period of 12 months after termination of employment Mr.
Cohen agreed not to compete with the Company's current
17
business or at any time during the term concluded by the Company. For a two-year
period following termination of Mr. Cohen's employment, he agreed not to solicit
clients to discontinue their relationship with the Company or solicit any
employee to discontinue employment with the Company.
On September 1, 2004, the Subsidiary entered into employment agreements
with its President/CEO and its Executive Vice President (collectively, the
"Employees"). These agreements provide for an annual base salary of not less
than $180,000 each for a three-year term plus certain additional benefits. Also,
the agreements call for Executive will receive additional compensation in the
form of shares of common stock of CDA based on the Subsidiary's financial
performance during the three year period commencing on the date of this
Agreement (the "Performance Period"). The Performance Period will not start
until the warehouse line capacity of the Subsidiary reaches $40 million. Upon
the spin-off of OWE, OWE will assume all liabilities and obligations of the
Company including the above described employment agreements. No amounts are
accrued for the deferred compensation as the Company has had no pre-tax profits.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
For all years referenced in the Summary Compensation Table, two former
shareholders of the Subsidiary, Mark Stewart and Daryl Meddings, determined
executive compensation. On July 15, 2004, both Mr. Stewart and Mr. Meddings sold
their Common Stock in the Company.
COMPENSATION COMMITTEE REPORT TO STOCKHOLDERS
The Compensation Committee, once in place, will issue a report at that
time and will be responsible for determining the compensation of executive
officers of the Company.
AUDIT AND NON-AUDIT FEES
Chavez and Koch CPA's ("Chavez") was the Company's independent auditor and
examined the financial statements of the Company for the fiscal year ended
September 30, 2004. Hein and Associates LLC ("Hein") was the Company's
independent auditor and examined the financial statements of the Company for the
fiscal year ended September 30, 2003.
Audit Fees
Chavez was paid aggregate fees of approximately $19,000 for the fiscal
year ended September 30, 2004 for professional services rendered for the audit
of the Company's annual financial statements. Hein was paid aggregate fees of
approximately $71,405 for the fiscal year ended September 30, 2003, for
professional services rendered for the audit of the Company's annual financial
statements and for the reviews of the financial statements included in the
Company's quarterly reports on Form 10-QSB during the fiscal ended September 30,
2004.
Audit Related Fees
Chavez and Hein were not paid additional fees for either of the fiscal
years ended September 30, 2003 or September 30, 2004 for assurance and related
services reasonably related to the performance of the audit or review of the
Company's financial statements.
Tax Fees
Chavez estimates fees in the amount of $2,500 for the fiscal year ended
September 30, 2004 for professional services rendered for tax compliance, tax
advice and tax planning during the fiscal year ended September 30, 2004. Hein
was paid fees in the amount of $10,331 for professional services rendered for
tax compliance, tax advice and tax planning during the fiscal year ended
September 30, 2004.
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Legal Proceedings
No current officer, director, affiliate or person known to us to be the
record or beneficial owners of in excess of 5% of our common stock, or any
person known to be an associate of any of the foregoing, is a party adverse to
us or has a material interest in any material pending legal proceeding.
No current officer, director, affiliate or person known to IBP to be the
record beneficial owner of in excess of 5% beneficial ownership of IBP, or any
person known to be an associate of any of the foregoing, is a party adverse to
IBP or has a material interest in any material pending legal proceeding.
FINANCIAL INFORMATION
The financial statements of IBP and pro forma consolidated financial
statements of IBP and the Company are contained in the Company's Current Report
on Form 8-K/A, Amendment No. 2 for June 10, 2005, filed on August 11, 2005,
which is an Exhibit to this Information Statement.
PROCEDURE FOR APPROVAL OF ACTION; VOTING
The Delaware General Corporation Law provides that any action which may be
taken at a meeting of the stockholders may be taken without a meeting and
without prior notice, if a consent in writing, setting forth the action so
taken, shall be signed by the holders of a majority of the outstanding shares
entitled to vote.
On __________, 2005, the record date for determination of the stockholders
entitled to receive this Information Statement, there were 25,733,280 shares of
common stock outstanding prior to the issuance of the shares of Common Stock
sold in the Offering. The holders of common stock are entitled to one vote for
each share held of record on all matters submitted to a vote of our
stockholders. We needed the affirmative vote of at least a majority of the
outstanding shares of our common stock to approve a change in the name of the
corporation to AskMeNow, Inc., the elimination of cumulative voting and
increasing the authorized common stock from 30,000,000 shares to 100,000,000
shares. Our Board, by its unanimous written consent, adopted resolutions
approving a change in the name of the corporation to AskMeNow, Inc., the
elimination of cumulative voting, the increase in authorized common stock, and
the spin-off of our Subsidiary. The Board also authorized the filing of the
Certificate of Amendment to Certificate of Incorporation with respect to the
foregoing with the Secretary of State of Delaware. By action by written consent,
dated March 4, 2005, CDA, the owner of 4,900,000 shares, or approximately 87.7%
of the issued and outstanding shares of our common stock at the time, approved a
change in the name of the corporation to AskMeNow, Inc., elimination of
cumulative voting and the increase in authorized common stock, and the filing of
the Certificate of Amendment to Certificate of Incorporation with the Delaware
Secretary of State.
The increase in authorized shares of Common Stock is not necessary to
complete the Transaction. Such increase in being made solely to assure the
availability of common stock for future transactions.
EFFECT ON CERTIFICATES EVIDENCING SHARES
OF OCEAN WEST HOLDING CORPORATION
The change in the name of Ocean West Holding Corporation to AskMeNow, Inc.
will be reflected in its stock records by book-entry in the Company's records.
For those stockholders that hold physical certificates, please do not destroy
them or send them to InfoByPhone, Inc. Those certificates will remain valid for
the number of shares shown thereon, and should be carefully preserved by you.
OTHER MATTERS
The Board of Directors knows of no other matters to report other than
those referred to in this Information Statement.
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EXHIBITS
The following documents filed by us with the Securities and Exchange
Commission pursuant to the Securities Exchange Act of 1934, as amended (the
"Exchange Act") are attached hereto:
1. Current Report on Form 8-K, filed on October 11, 2005;
2. Current Report on Form 8-K, filed on October 7, 2005;
3. Annual Report on Form 10-KSB/A Amendment No. 2, filed on September
21, 2005;
4. Quarterly Report on Form 10-QSB filed on August 19, 2005, for the
quarterly period ended June 30, 2005;
5. Current Report on Form 8-K, filed on August 15, 2005;
6. Current Report on Form 8-K/A Amendment No. 2, filed on August 11,
2005;
7. Current Report on Form 8-K, filed on August 3, 2005;
8. Current Report on Form 8-K, filed on August 2, 2005;
9. Current Report on Form 8-K/A Amendment No. 1, filed on July 11,
2005;
10. Current Report on Form 8-K, filed on July 8, 2005;
11. Current Report on Form 8-K/A Amendment No. 1, filed on June 30,
2005;
12. Current Report on Form 8-K/A Amendment No. 1, filed on June 10,
2005;
13. Current Report on Form 8-K filed on June 9, 2005;
14. Schedule 14F-1/A Amendment No. 3 for June 30, 2005.
15. Quarterly Report on Form 10-QSB filed on May 23, 2005, for the
quarterly period ended March 31, 2005;
16. Current Report on Form 8-K filed on April 29, 2005;
17. Quarterly Report on Form 10-QSB filed on February 18, 2005, for the
quarterly period ended December 31, 2004; and
18. Current Report on Form 8-K filed on February 4, 2005.
DELIVERY OF INFORMATION STATEMENT TO HOUSEHOLDS
As permitted by applicable law, only one copy of this information
statement is being delivered to stockholders residing at the same address,
unless such stockholders have notified the Company of their desire to receive
multiple copies of this information statement.
The Company will promptly deliver, upon oral or written request, a
separate copy of this information statement to any stockholder residing at an
address to which only one copy of either such document was mailed. Requests for
additional copies should be directed to the Company's Secretary, at the
Company's corporate offices at Ocean West Holding Corporation, 26 Executive
Park, Suite 250, Irvine, California 92614, or telephone at [(772) 492-0104].
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Stockholders who share an address can request the delivery of separate
copies of future proxy or information statements or the Company's annual report
upon written request which should be directed to the Company's Secretary, at the
Company's corporate offices at Ocean West Holding Corporation, 26 Executive
Park, Suite 250, Irvine, California 92614, or telephone at [(772) 492-0104].
Stockholders who share an address can request the delivery of a single
copy of this information statement upon written request. Such request should be
directed to the Company's Secretary, at the Company's corporate offices at Ocean
West Holding Corporation, 26 Executive Park, Suite 250, Irvine, California
92614, or telephone at [(772) 492-0104].
THE DOCUMENTS RELATING TO US ARE ALSO AVAILABLE TO ANY PERSON, INCLUDING
ANY BENEFICIAL OWNER, TO WHOM THIS INFORMATION STATEMENT IS DELIVERED, ON
WRITTEN OR ORAL REQUEST, WITHOUT CHARGE, BY WRITING TO US AT OCEAN WEST HOLDING
CORPORATION, 26 EXECUTIVE PARK, SUITE 250, IRVINE, CA 92617; ATTENTION: CHIEF
EXECUTIVE OFFICER, OR BY CALLING THE COMPANY AT [(772) 492-0104] COPIES OF
DOCUMENTS SO REQUESTED WILL BE SENT BY FIRST CLASS MAIL, POSTAGE PAID, WITHIN
ONE BUSINESS DAY OF THE RECEIPT OF SUCH REQUEST.
By order of the Board of Directors
/s/ Darryl Cohen
--------------------------------------
Darryl Cohen, President
Chief Executive Officer and Director
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APPENDIX A
AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION
OF
ASKMENOW, INC.
This Amended and Restated Certificate of Incorporation hereby amends and
restates in its entirety that certain Certificate of Incorporation of Ocean West
Holding Corporation, as filed with the Delaware Secretary of the State on
February 1, 2000. The name of the corporation is AskMeNow, Inc. The original
name of the corporation was Ocean West Holding Corporation. This Amended and
Restated Certificate of Incorporation was duly adopted in accordance with
Sections 242 and 245 of the Delaware General Corporation Law.
1. Name. The name of the Corporation is "AskMeNow, Inc." (the "Corporation").
2. Registered Office. The address of the registered office of the Corporation in
the State of Delaware is 222 Delaware Avenue, 9th Floor in the City of
Wilmington, County of New Castle, Delaware 19801. The name of its registered
agent at that address is The Delaware Corporation Agency.
3. Business. The nature of the business or purpose of the Corporation is to
engage in any lawful act or activity for which corporations may be organized
under the General Corporation Law of Delaware.
4. Capital Structure.
4.1. Authorized Shares. The total number of shares of capital stock which
the Corporation shall have authority to issue is 110,000,000 shares, consisting
of two classes of capital stock:
(a) 100,000,000 shares of Common Stock, par value $.01 per share (the
"Common Stock"); and
(b) 10,000,000 shares of Preferred Stock, par value $.01 per share (the
"Preferred Stock"), for which the Board of Directors may designate additional
series.
4.2. Preemptive Rights. No holder of shares of any class of stock of the
Corporation now or hereafter authorized shall have any preferential or
preemptive right to subscribe for, purchase or receive any shares of the
Corporation of any class now or hereafter authorized, or any portions or
warrants for such shares, or any securities convertible into or exchangeable for
such shares, which may at any time be issued, sold or offered for sale by the
Corporation.
5. Incorporator. The incorporator is Ocean West Enterprises, Inc., whose mailing
address is 4117 West 16th Square, Vero Beach, FL 32967.
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6. Dividends.
6.1 When, as, and if dividends are declared by the Corporation's Board of
Directors, whether payable in cash, property, securities or rights of the
Corporation or any other entity, the holders of shares of Common Stock shall be
entitled to share equally in and to receive, in accordance with the number of
Common Stock held by each such holder.
6.2 Dividends payable under this Section 6 shall be paid to the holders of
record of the outstanding Common Stock as their names shall appear on the stock
register of the Corporation on the record date fixed by the Board of Directors
in advance of declaration and payment of each dividend. Any Common Stock issued
as a dividend pursuant to this Section shall, when so issued, be duly
authorized, validly issued, fully paid and non-assessable, and free of all liens
and charges The Corporation shall not issue fractions of Common Stock on payment
of such dividend but shall issue a whole number of shares to such holder of
Common Stock rounded up or down in the Corporation's sole discretion to the
nearest whole number, without compensation to the stockholder whose fractional
shares has been rounded down or form any stockholder whose fractional share has
been rounded up.
7. Liquidation Rights. Upon any voluntary or involuntary liquidation,
dissolution or winding-up of the affairs of the Corporation, after payment shall
have been made to holders of outstanding Preferred Stock, if any, of the full
amount to which they are entitled pursuant to this Certificate of Incorporation
and any resolutions that may be adopted from time to time by the Corporation's
Board of Directors in accordance with Section 9 below, the holders of Common
Stock shall be entitled, to the exclusion of the holders of Preferred Stock, if
any, to share ratably in accordance with the number of Common Stock held by each
such holder, in all remaining assets of the Corporation available for
distribution among the holders of Common Stock, whether such assets are capital,
surplus or earnings. For purposes of this Section, neither the consolidation or
merger of the Corporation with or into any other corporation or corporations
pursuant to which the stockholders of the Corporation receive capital stock
and/or other securities (including debt securities) of the acquiring corporation
(or of the direct or indirect parent corporation of the acquiring corporation),
nor the sale, lease or transfer by the Corporation of all or any part of its
assets, nor the reduction of the capital stock of the Corporation, shall be
deemed to be a voluntary or involuntary liquidation, dissolution or winding up
of the Corporation as those terms are used in this Section 7.
8. Voting Rights.
8.1. The holders of the Common Stock shall vote as a single class on all
matters submitted to a vote of the stockholders, with each Share entitled to one
vote. The holders of Common Stock are not entitled to cumulative votes in the
election of any directors.
8.2. In the event that the shares of Common Stock shall be listed and
quoted on an exchange or other trading system, the Board of Directors of the
Corporation shall ensure, and shall have all powers necessary to ensure, that
the membership of the Board of Directors and the voting rights of the Holders of
Common Stock shall at all times be consistent with the applicable rules and
regulations, if any, for the Common Stock to be eligible for listing and
quotation on such exchange or other trading system.
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9. Preferred Stock. Subject to the provisions of this Certificate of
Incorporation, the Board of Directors is authorized, subject to limitations
prescribed by law, to provide for the issuances of the shares of Preferred Stock
in series, and by filing a certificate pursuant to the applicable law of the
State of Delaware, to establish from time to time the number of shares to be
included in each such series, and to fix the designation, powers, preferences
and rights of the shares of each such series and the qualifications, limitations
or restrictions thereof.
The authority of the Board of Directors with respect to each series shall
include, but not be limited to, determination of the following:
(a) The number of shares constituting that series and the distinctive
designation of that series;
(b) The dividend rate on the shares of that series, whether dividends shall be
cumulative, and, if so, from which date or series, and the relative rights of
priority, if any, of payment of dividends on shares of that series;
(c) Whether that series shall have voting rights, in addition to the voting
rights provided by law, and if so, the terms of such voting rights;
(d) Whether that series shall have conversion privileges, and, if so, the terms
and conditions of such conversion, including provision for adjustment of the
conversion rate in such events as the Board of Directors shall determine;
(e) Whether or not the shares of that series shall be redeemable, and, if so,
the terms and conditions of such redemption, including the date or date upon or
after which they shall be redeemable, and the amount per share payable in case
of redemption, which amount may vary under different conditions and at different
redemption dates;
(f) Whether that series shall have a sinking fund for the redemption nor
purchase of shares of that series, and, if so, the terms and amount of such
sinking fund, and
(g) The rights of the shares of that series in the event of voluntary or
involuntary liquidation, dissolution or winding up of the Corporation, and the
relative rights of priority, if any, of payment of shares of that series
10. Existence. The Corporation is to have perpetual existence.
11. Bylaws. In furtherance and not in limitation of the powers conferred by
statute, the Board of Directors is expressly authorized to make, alter or repeal
the bylaws of the Corporation.
12. Elections, Meeting and Books. Elections of directors need not be by written
ballot unless the bylaws of the Corporation shall so provide. Meetings of
stockholders may be held within or without the State of Delaware, as the bylaws
may provide. The books of the Corporation
3
may be kept (subject to any provision contained in the statutes) outside the
State of Delaware at such place or places as may be designated from time to time
by the board of directors or in the bylaws of the Corporation.
13. Amendments. The Corporation reserves the right to amend, alter, change or
repeal any provision contained in this Certificate of Incorporation, in the
manner now or hereafter prescribed by statute, and all rights conferred upon
stockholders herein are granted subject to this reservation.
14. Limitation on Director Liability. No director shall be personally liable to
the Corporation or any of its stockholders for monetary damages for breach of
fiduciary duty as a director; except for liability: (a) for any breach of the
director's duty of loyalty to the Corporation or its stockholders; (b) for acts
or omissions not in good faith or which involve intentional misconduct or a
knowing and culpable violation of law; (c) under Section 174 of the Delaware
General Corporation Law, or (d) for any transaction from which the director
derived an improper personal benefit. If the Delaware General Corporation Law
hereafter is amended to authorize corporate action further eliminating or
limiting the personal liability of directors, then the liability of a director
of the Corporation shall be eliminated or limited to the fullest extent of the
Delaware General Corporation Law as so amended. Any repeal or modification of
this Section shall be prospective only, and shall not adversely affect any
limitation on the personal liability of a director of the Corporation existing
at the time of such repeal or modification.
15. Indemnification.
15.1. General. Each person who was or is made a party to or is threatened
to be made a party to or is involved in any action, suit or proceeding, whether
civil, criminal, administrative or investigation (hereinafter a "proceeding"),
by reason of the fact that he or she, or a person of whom he or she is the legal
representative, is or was a Director office of the Corporation or is or was
serving at the request of the Corporation as a Director, officer, employee or
agent of another corporation or of a partnership, joint venture, trust or other
enterprise, including service with respect to employee benefit plans, whether
the basis of such proceeding is alleged action in any other capacity while
serving as a director, officer, employee or agent or in any other capacity while
serving as a Director, officer, employee or agent, shall be indemnified and held
harmless by the Corporation to the fullest extent authorized by the Delaware
General Corporation Law, as the same exists or hereafter by amended (but, in the
case of any such amendment, only to the extent that such amendment permits the
Corporation to provide broader indemnification rights that said law permitted
the Corporation to provide prior to such amendment), against all expense,
liability and loss (including attorneys' fees, judgments, fines, ERISA excise
taxes or penalties and amounts paid or to be paid in settlement) reasonably
incurred or suffered by such person in connection therewith and such
indemnification shall continue as to person who has ceased to be a Director,
officer, employee or agent and shall inure to the benefit of his or her heirs,
executors and administrators; provided, however, that, except as provided in
Section 15.2, the Corporation shall indemnify any such person seeking
indemnification in connection with a proceeding (or part thereof) initiated by
such person only if such proceeding (or part thereof) was authorized by the
Board of Directors of the Corporation. The right to indemnification
4
conferred in this Section shall be a contract right and shall include the right
to be paid by the Corporation the expenses incurred in defending any such
proceeding in advance of its final disposition; provided, however, that if the
Delaware General Corporation Law requires, the payment of such expenses incurred
by a Director or officer in his or her capacity as a Director or officer (and
not in any other capacity in which service was or is rendered by such person
while a Director or officer, including, without limitation, service to an
employee benefit plan) in advance of the final disposition of a proceeding shall
be made only upon delivery to the Corporation of an undertaking, by or on behalf
of such Director or officer, to repay all amounts so advanced if it shall
ultimately be determined that such Director or officer is not entitled to be
indemnified under this Section or otherwise. The Corporation may, by action of
its Board of Directors, provide indemnification to employees and agents of the
Corporation with the same scope and effect as the foregoing indemnification of
Directors and officers.
15.2. Failure to Pay a Claim. If a claim under Subsection 15.1 is not paid
in full by the Corporation within thirty (30) days after a written claim has
been received by the Corporation, the claimant may at any time thereafter bring
suit against the Corporation to recover the unpaid amount of the claim and, if
successful in whole or part, the claimant shall be entitled to be paid also the
expense of prosecuting such claim. It shall be a defense to any such action
(other than an action brought to enforce a claim for expenses incurred in
defending any proceeding in advance of its final disposition where the required
undertaking, if any is required, has been tendered to the Corporation) that the
claimant has not met the standards of conduct which make it permissible under
the Delaware General Corporation Law for the Corporation to indemnify the
claimant for the amount claimed, but the burden of proving such defense shall be
on the Corporation. Neither the failure of the Corporation (including its Board
of Directors, independent legal counsel, or its stockholders) to have made a
determination prior to the commencement of such action that indemnification of
the claimant is proper in the circumstances because he or she has met the
applicable standard of conduct set forth in the Delaware General Corporation
Law, nor an actual determination by the Corporation (including its Board of
Directors, independent legal counsel, or its stockholders) that the claimant has
not met such applicable standard of conduct, shall be a defense to the action or
create a presumption that the claimant has not met the applicable standard of
conduct.
15.3. Not Exclusive. The right to indemnification and the payment of
expenses incurred in defending a proceeding in advance of its final disposition
conferred in this Section shall not be exclusive of any other right which any
person may have or hereafter acquire under any statute, provision of this
Certificate of Incorporation, bylaw, agreement, vote of stockholders or
disinterested Directors or otherwise.
15.4. Insurance. The Corporation may maintain insurance, at its expense,
to protect itself and any Director, officer, employee or agent of the
Corporation or another corporation, partnership, joint venture, trusts or other
enterprise against any such expense, liability or loss, whether or not the
Corporation would have the power to indemnify such person against such expense,
liability or loss under the Delaware General Corporation Law.
5
15.5. Definition of the Corporation. As used in this Section, references
to "the Corporation" shall include, in addition to the resulting or surviving
corporation, any constituent corporation absorbed in a consolidation or merger
which, if its separate existence had continued, would have had power and
authority to indemnify its Directors, officers, employees and agents, so that
any person who is or was a Director, officer, employee or agent of such
constituent corporation, or is or was serving at the request of such constituent
corporation as a Director, officer, employee or agent of another corporation,
partnership, joint venture, trust, or other enterprise, shall stand in the same
position under the provisions of this Section with respect to the resulting or
surviving corporation as he would have with respect to such constituent
corporation if its separate existence had continued.
15.6. Severability. If this Section or any portion hereof shall be
invalidated on any ground by any court of competent jurisdiction, then the
Corporation shall nevertheless indemnify each Director, officer, employee and
agent of the Corporation as to expenses (including attorneys' fees), judgments,
fines and amounts paid in settlement with respect to any action, suit or
proceeding, whether civil, criminal, administrative or investigative, including
a grand jury proceeding and an action by the Corporation, to the fullest extent
permitted by any applicable portion of this Section that shall not have been
invalidated or by any other applicable law.
16. Creditors. Whenever a compromise or arrangement is proposed between this
Corporation and its creditors or any class of them and/or between this
Corporation and its stockholders or any class of them, any court of equitable
jurisdiction within the State of Delaware may, on the application in a summary
way of this Corporation or of any creditor or stockholder thereof or on the
application of any receiver or receivers appointed for this Corporation under
the provisions of Section 291 of Title 8 of the Delaware Code or on the
application of trustees in dissolution or of any receiver or receivers appointed
for this Corporation under the provisions of Section 279 of Title 8 of the
Delaware Code order a meeting of the creditors or class of creditors, and/or of
the stockholders or class of stockholders of this Corporation, as the case may
be, to be summoned in such manner as the said court directs. If a majority in
number representing seventy-five per cent (75%) in value of the creditors or
class of creditors, and/or if the stockholders or class of stockholders of this
Corporation, as the case may be, agree to any compromise or arrangement and to
any reorganization of this Corporation as consequence of such compromise or
arrangement, said compromise or arrangement and said reorganization shall, if
sanctioned by the court to which said application has been made, be binding on
all the creditors or class of creditors, and/or on all the stockholders or class
of stockholders, of this Corporation, as the case may be, and also on this
Corporation.
IN WITNESS WHEREOF, the Corporation has caused this Amended and Restated
Certificate of Incorporation to be signed by its President and Chief Executive
Officer on this ___ day of July, 2005.
-------------------------------
Darryl Cohen
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