-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, IeTdOrn7WqjqEIvbIAvlEtknWmpGF5amKXO0TVW1RixUSe4iWcmF64py/87D3Hut XeioM7x5KaQmBffpIyIR9w== 0001015402-03-001644.txt : 20030507 0001015402-03-001644.hdr.sgml : 20030507 20030507121932 ACCESSION NUMBER: 0001015402-03-001644 CONFORMED SUBMISSION TYPE: PRER14C PUBLIC DOCUMENT COUNT: 1 FILED AS OF DATE: 20030507 FILER: COMPANY DATA: COMPANY CONFORMED NAME: KAIRE HOLDINGS INC CENTRAL INDEX KEY: 0000822997 STANDARD INDUSTRIAL CLASSIFICATION: IN VITRO & IN VIVO DIAGNOSTIC SUBSTANCES [2835] IRS NUMBER: 133367421 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: PRER14C SEC ACT: 1934 Act SEC FILE NUMBER: 000-21384 FILM NUMBER: 03685568 BUSINESS ADDRESS: STREET 1: 7348 BELLAIRE CITY: NORTH HOLLYWOOD STATE: CA ZIP: 91605 BUSINESS PHONE: 8182554996 MAIL ADDRESS: STREET 1: 2139 PONTIUS AVE CITY: LOS ANGELES STATE: CA ZIP: 90021 FORMER COMPANY: FORMER CONFORMED NAME: INTERACTIVE MEDICAL TECHNOLOGIES LTD DATE OF NAME CHANGE: 19920703 FORMER COMPANY: FORMER CONFORMED NAME: INTERACTIVE PRINCIPLES LTD DATE OF NAME CHANGE: 19900419 PRER14C 1 doc1.txt UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 SCHEDULE 14C (AMENDMENT NO. 1) 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 KAIRE HOLDINGS INC. (Name of Registrant As Specified In Charter) Not Applicable (Name of Person(s) Filing the Information Statement if other than Registrant) Payment of Filing Fee (Check the appropriate box): /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 transaction applies: 2) Aggregate number of securities to which transaction applies: 3) Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11: 4) Proposed maximum aggregate value of transaction: / / Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing. 1) Amount Previously Paid: 2) Form, Schedule or Registration Statement No.: 3) Filing Party: 4) Date Filed: 1 KAIRE HOLDINGS, INC. 8135 Clybourn Ave. Sun Valley, California 91352 NOTICE OF WRITTEN CONSENT OF SHAREHOLDERS May 6, 2003 To Shareholders of Kaire Holdings, Inc.: NOTICE IS HEREBY GIVEN that the following actions will be taken pursuant to the written consent of a majority of our shareholders, dated March 28, 2003, in lieu of a special meeting of the shareholders. The following actions will be effective on or about May 26, 2003: 1. amendment of our certificate of incorporation to provide for a stock combination (reverse split) of the Common Stock in an exchange ratio to be approved by the Board, ranging from one newly issued share for each two outstanding shares of Common Stock to one newly issued share for each two hundred outstanding shares of Common Stock. 2. the ratification of the appointment of Pohl, McNabola & Berg, LLP as our independent accountants for the current fiscal year. This Notice and the attached Information Statement are being circulated to advise the shareholders of certain actions already approved by written consent of the shareholders who collectively hold a majority of the voting power of our common stock. Pursuant to Rule 14c-2 under the Securities Exchange Act of 1934, as amended, the proposals will not be effective until 20 days after the date this Information Statement is mailed to the shareholders. Therefore, this Notice and the attached Information Statement are being sent to you for informational purposes only. By Order of the Board of Directors, /s/ Steven Westlund --------------- Steven Westlund, Chief Executive Officer and Director. 2 KAIRE HOLDINGS, INC. 8135 Clybourn Ave. Sun Valley, California 91352 INFORMATION STATEMENT WRITTEN CONSENT OF SHAREHOLDERS WE ARE NOT ASKING YOU FOR A PROXY AND YOU ARE REQUESTED NOT TO SEND US A PROXY This Information Statement is furnished in accordance with the requirements of Regulation 14C promulgated under the Securities Exchange Act of 1934, as amended, by KAIRE HOLDINGS INC., a Delaware corporation, in connection with certain actions to be taken by the written consent by the majority shareholders of Kaire holdings, dated March 28, 2003. Pursuant to Rule 14c-2 under the Securities Exchange Act of 1934, as amended, the actions will not be effective until 20 days after the date of this Information Statement is mailed to the shareholders. THE APPROXIMATE DATE OF MAILING OF THIS INFORMATION STATEMENT IS May 6, 2003. We anticipate that the actions contemplated by this Information Statement will be effected on or about the close of business on May 26, 2003. The actions to be effective twenty days after the mailing of this Information Statement are as follows: 1. amendment of our certificate of incorporation to provide for a stock combination (reverse split) of the Common Stock in an exchange ratio to be approved by the Board, ranging from one newly issued share for each two outstanding shares of Common Stock to one newly issued share for each two hundred outstanding shares of Common Stock. 2. the ratification of the appointment of Pohl, McNabola & Berg, LLP as our independent accountants for the current fiscal year. Shareholders of record at the close of business on March 28, 2003 are entitled to notice of the action to be effective on or about May 26, 2003. As of the record date, our authorized capitalization consisted of 900,000,000 shares of common stock, par value $0.001 per share, of which 880,484,863 were issued and outstanding. Each share of our common stock entitles its holder to one vote on each matter submitted to the shareholders. However, because the shareholders holding at least a majority of the voting rights of all outstanding shares of capital stock as of the record date have voted in favor of the foregoing actions by resolution dated March 28, 2003; and having sufficient voting power to approve such proposals through their ownership of the capital stock, no other consents will be solicited in connection with this Information Statement. Shareholders of record at the close of business on March 28th, 2003 are being furnished copies of this Information Statement. The principal executive office of the Company is located at 8135 Clybourn Ave., Sun Valley, California 91352 and the Company's telephone number is (818) 255-4996. 3 SHAREHOLDER DISSENTER'S RIGHT OF APPRAISAL The General Corporate Law of Delaware does not provide for dissenter's rights of appraisal in connection with the proposed actions. THIS IS NOT A NOTICE OF A SPECIAL MEETING OF SHAREHOLDERS AND NO SHAREHOLDER MEETING WILL BE HELD TO CONSIDER ANY MATTER WHICH WILL BE DESCRIBED IN THIS INFORMATION STATEMENT. MATTERS SET FORTH IN THE WRITTEN CONSENTS The Written Consents contain: (i) A Resolution dated March 28, 2003, to amend the Certificate of Incorporation in order to provide for a stock combination (reverse split) of the Common Stock in an exchange ratio to be approved by the Board, ranging from one newly issued share for each two outstanding shares of Common Stock to one newly issued share for each two hundred outstanding shares of Common Stock and ratification of the appointment of Pohl, McNabola & Berg, LLP as our independent accountants for the current fiscal year. Shareholders representing 52.0% of the votes of the currently issued and outstanding shares of Common Stock have executed the Written Consents, thereby ensuring the stock combination. See "Other Information Regarding The Company - Security Ownership of Certain Beneficial Owners and Management." Set forth below is a table of the stockholders who have executed the Written Consents and, to the best of the Company's knowledge, the number of shares of Common Stock beneficially owned by such stockholders as of March 28, 2003:
COMMON SHR'S VOTES/SHR. COMMON VOTES % OF TOTAL VOTES - ------------------------------ ------------------------ -------------------------------- Total Common Issued and Outstanding Votes Possible 1 880,484,683 100.00% Votes by Written Consent for Reverse Split Beneficial Owner - ------------------------------------------------------------------------------------------ Steven Westlund 4,000,000 1 4,000,000 .4% George R. Lefevre 55,000,000 1 55,000,000 6.2% Scott Absher 55,000,000 1 55,000,000 6.2% Richard D. Mckinley (ENTR Shares) 250,000,000 1 250,000,000 28.4% Randy Jones 8,666,666 1 8,666,666 1.0% Jay Isco 2,000,000 1 2,000,000 .2% Owen Naccarato 57,666,666 1 57,666,666 6.5% Joseph Maleki 3,500,000 1 3,500,000 .4% Mike Isco 12,500,000 1 12,500,000 1.4% Stash Trust 10,333,333 1 10,333,333 1.2% ----------- ----------- ----- Total 458,666,665 1 458,666,665 52.0%
4 VOTE REQUIRED Counterpart copies of the Written Consents evidencing a majority of the outstanding shares of Common Stock, must be received by the Company within sixty days of the earliest dated consent delivered by the Company in order to effectuate the matters set forth therein. As of March 28, 2003 (the dates of the Written Consents), 880,484,863 shares of Common Stock were issued and outstanding with votes of 880,484,683 votes thus, Stockholders representing no less than 440,242,432 votes from Common Stock, were required to execute the Written Consents to effect the matter set forth therein. As discussed under "Matters Set Forth in the Written Consents," shareholders owning approximately 454,666,665 votes, or 52.0% of the votes of Common Stock, have executed the Written Consents and delivered them to the Company as required by law within the 60 day period, thereby ensuring the stock combination. PURPOSES OF THE REVERSE SPLIT One purpose of the Reverse Split would be to provide enough shares for the conversion of our outstanding convertible debt. As of the date of this proxy there are not enough authorized shares available to convert our outstanding convertible debt. A reverse split would reduce the number of the shares outstanding which would allow for the conversion of our convertible debt. Another purpose of the Reverse Split would be to increase the market price of our Common Stock which would facilitate the conversion of the outstanding convertible notes because with a higher stock price, fewer shares would be required to retire the outstanding convertible debt. Another purpose of the Reverse Split would be to improve the usefulness of our Common Stock as a means to raise financing and as a possible currency for acquisitions and other transactions which could be achieved with an increase in the stock price. There are no anti-dilution protections for the debt holders. The Common Stock traded on The NASDAQ OTC:BB at market prices ranging from approximately $0.0021 to approximately $0.28 from July 1, 2001 through December 31, 2002 and was recently as low as $0.0003 per share. This price range has reduced the possibilities of using the Common Stock or instruments convertible or exercisable into Common Stock in order to raise financing to support the Company's operations and to increase the Company's net worth and as consideration for potential acquisitions. THERE CAN BE NO ASSURANCE, HOWEVER, THAT, EVEN AFTER CONSUMMATING THE REVERSE SPLIT, THE COMPANY WILL BE ABLE TO MAINTAIN ITS MARKET PRICE PER SHARE AND THUS UTILIZE ITS COMMON STOCK IN ORDER TO EFFECTUATE FINANCING OR ACQUISITION TRANSACTIONS. The Reverse Split will not change the proportionate equity interests of the Company's stockholders at the time of the split, nor will the respective voting rights and other rights of stockholders be altered, except for possible immaterial changes due to rounding up to eliminate fractional shares. However, upon the issuance of shares for the conversion of the outstanding convertible debt or for fund raising or for acquisitions, the shareholders would most likely experience dilution plus a decrease in the market price of the stock. The Common Stock issued pursuant to the Reverse Split will remain fully paid and non-assessable. The Company will continue to be subject to the periodic reporting requirements of the Securities Exchange Act of 1934, as amended. 5 CERTAIN EFFECTS OF THE REVERSE SPLIT The following table illustrates the principal effects of the Reverse Split to the 880,484,863 shares of Common Stock outstanding as of March 31, 2003:
COMMON SHARES: - -------------- PRIOR TO AFTER 1 FOR 2 AFTER 1 FOR 200 NUMBER OF SHARES REVERSE REVERSE REVERSE STOCK SPLIT STOCK SPLIT STOCK SPLIT Common Stock: Authorized 900,000,000 900,000,000 900,000,000 Outstanding (1) 880,484,863 440,242,312 4,402,424 Available for Future Issuance 19,515,137 459,757,688 895,597,576 Less Conversion of Convertible Debentures (1,829,720,833)(2) (914,860,416)(3) (91,486,041)(4) Available for Future Issuance (1,810,235,696) (455,102,728) 804,111,535
(1) Gives effect to the Reverse Split, excluding New Shares to be issued in lieu of fractional shares. Stockholders should recognize that, if the Reverse Split is effectuated, they will own a fewer number of shares than they presently own (a number equal to the number of shares owned immediately prior to the filing of the amendment regarding the Reverse Split divided by the Exchange Number, as adjusted to include New Shares to be issued in lieu of fractional shares). While the Company expects that a Reverse Split will result in an increase in the market price of the Common Stock, there can be no assurance that the Reverse Split will increase the market price of the Common Stock by a multiple equal to the Exchange Number or result in a permanent increase in the market price (which is dependent upon many factors, including the Company's performance and prospects). Also, should the market price of the Company's Common Stock decline after the Reverse Split, the percentage decline may be greater than would be the case in the absence of the Reverse Split. The possibility exists that liquidity in the market price of the Common Stock could be adversely affected by the reduced number of shares that would be outstanding after the Reverse Split. In addition, the Reverse Split will increase the number of stockholders of the Company who own odd-lots (less than 100 shares). Stockholders who hold odd-lots typically will experience an increase in the cost of selling their shares, as well as greater difficulty in effecting such sales. Consequently, there can be no assurance that the Reverse Split will achieve the desired results that have been outlined above. The large number of shares underlying the convertible debentures are available for future sale and the sale of these shares may depress the 6 market price of our common stock and may cause substantial dilution to our existing stockholders. Furthermore, the number of shares of common stock issuable upon conversion of the convertible debentures may increase if the market price of our stock declines and the sale of the increased number of shares may further adversely affect the market price of our common stock. The issuance of shares upon conversion of the convertible debentures will also cause immediate and substantial dilution to our existing stockholders. The convertible debentures are held by three different parties of which two are affiliated. The affiliated parties are contractually limited to hold in the aggregate less than 4.9% of our outstanding shares. The third party is contractually limited to hold less than 4.9% of our outstanding shares. (2) Assuming $878,266 of 8% Convertible Debentures converted at eighty percent (80%) of stock price of $0.0006 (i.e. $0.00048)as of May 6, 2003. (3) Assuming $878,266 of 8% Convertible Debentures converted at eighty percent (80%) of stock price of $0.0012 (1.e. $0.00096). Note that the stock price of $0.0012 is the correct mathematical calculation of the post split stock price, however a stock price generally decreases after a reverse split is effectuated. See footnote one above. (4) Assuming $878,266 of 8% Convertible Debentures converted at eighty percent (80%) of stock price of $0.12 (i.e. $0.0096). Note that the stock price of $0.12 is the correct mathematical calculation of the post split stock price, however a stock price generally decreases after a reverse split is effectuated. See footnote one above. Stockholders should also recognize that, as indicated in the foregoing table, there would be an increase in the number of shares, which the Company will be able to issue from authorized but un-issued shares of Common Stock for transaction other than debt reduction. As a result of any issuance of shares, the equity of holders of outstanding shares may be diluted. Kaire has not made any plan, commitment, arrangement, understanding or agreement, written or oral, regarding any issuance of common stock subsequent to the reverse stock split. OTHER INFORMATION REGARDING THE COMPANY SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS The following table sets forth certain information known to the Company with respect to the beneficial ownership of the Company's common stock as of March 31, 2003 by (i) each person who is known by the Company to own beneficially more than 5% of the Company's common stock, (ii) each of the Company's directors and executive officers, and (iii) all officers and directors of the Company as a group. Except as otherwise listed below, the address of each person is c/o KAIRE HOLDINGS INC., 8135 Clybourn Ave., Sun Valley, California 91352. 7
- -------------------------------------------------------------------------------- Name and Address Shares Beneficially Owned Percent of Class (1) Steven R. Westlund 4,000,000(2) 0.4% 8135 Clybourn Ave. Sun Valley, CA 91352 - --------------------------------------------------------------------------------
(1) Except as pursuant to applicable community property laws, the persons named in the table have sole voting and investment power with respect to all shares of common stock beneficially owned. The total number of issued and outstanding shares of 880,484,863 and the total number of shares owned by each person is calculated as of March 28, 2003. BOARD COMMITTEES The Board of Directors does not currently maintain an Audit Committee or a Compensation Committee, but plans to appoint an Audit Committee and a Compensation Committee in the near future. During the fiscal year ended December 31, 2002, the Board of Directors held one meeting. COMPENSATION OF DIRECTORS The Company's Directors are not currently compensated for attendance at Board of Directors meetings. EXECUTIVE COMPENSATION The following table lists the names and ages of the executive officers and directors of the Company and the Subsidiary. The directors were elected on February 28, 2002 and will continue to serve until the next annual shareholders meeting or until their successors are elected and qualified. All officers serve at the discretion of the Board of Directors. Name Age Position With the Company - --------------- --- ------------------------------------ Steven Westlund 57 Chief Executive Officer and Chairman Steve Westlund: On April 1, 2000, Mr. Westlund signed a three-year employment - -------------- agreement (attached hereto as Exhibit 10.36). The contract calls for Mr. Westlund to be paid a base salary of $8,333.33 per month for the first year of the term. Mr. Westlund's base salary shall increase 15 % per year for the second year and third years, respectively, per the agreement. Although Mr. Westlund's Employment Agreement states that his salary is to be $8,333.33 per month, his actual pay has been $ 2,900.00 per month. Mr. Westlund is entitled to be paid the balance of his monthly compensation in either cash or equity. 8
SUMMARY COMPENSATION TABLE LONG-TERM COMPENSATION ------------------------------- ANNUAL COMPENSATION AWARDS PAYOUTS ----------------------------- ---------------------- ------- NAME AND RESTRICTED SECURITIES PRINCIPAL OTHER ANNUAL STOCK UNDERLYING LTIP ALL OTHER POSITION YEAR SALARY BONUS COMPENSATION(1) AWARD(S) OPTIONS(#) PAYOUTS COMPENSATION - ------------------- ---- ------ ----- --------------- ---------- ----------- ------- ------------ Steven Westlund 2002 $35,000 0 0 0 0 0 0 2001 $25,750 0 0 0 0 0 0 2000 $0 0 0 0 0 0 0
OPTIONS GRANTED IN LAST FISCAL YEAR No options to purchase Common Stock of the Company have been granted to the Company's executive officers. FISCAL YEAR-END OPTION EXERCISES AND OPTION VALUES No options to purchase Common Stock of the Company have been granted to the Company's executive officers. EMPLOYEE COMPENSATION We do not yet have a compensation committee that approves or offers recommendations on compensation for our employees. LEGAL PROCEEDINGS Patent Claim - ------------ An individual filed a complaint against us alleging breach of contract and fraud and related business torts related to certain patents that the plaintiff transferred to us. We believe that the plaintiff's claims are without merit. Although we reached a tentative settlement in this matter, the Plaintiff has failed to execute the settlement and the case was dismissed. Department of Health Services - Medi-Cal Action Against Classic Care Pharmacy - ----------------------------------------------------------------------------- On April 17, 2002 the Department of Health Services ("DHS") notified the management of Classic Care Pharmacy that the Medi-Cal Program intended to withhold 100% of payments and temporarily suspend and deactivate the Classic Care Pharmacy Medi-Cal provider number. The Department of Health Services ("DHS") took this action after having reviewed the prescriptions on record at Classic Care Pharmacy. The DHS stated that they had reviewed thirty-two prescriptions, and that two of the ten prescribing physicians had denied treating the patients and writing the prescriptions. The DHS cited Classic Care Pharmacy for violations of CCR, Title 22, Sec.51476.1, (a) and 51476.1(a)(2), which states that written prescriptions must contain the name of the prescribing physician and their provider number. Based on its findings the DHS and the Medical Program concluded that Classic Care Pharmacy might have intentionally committed fraud. 9 Classic Care management retained outside counsel shortly after receiving the DHS notice to review the Department of Health Services findings. After reviewing the supporting DHS material, outside counsel informed Classic Care management that it believed the facts presented by the DHS were inaccurate and that its position was unfounded. Classic Care management and its principle shareholders obtained written affidavits from most of the physicians whose prescriptions had been reviewed by the DHS confirming that they had treated the patients and did prescribe the medications. On April 29, 2002, outside counsel contacted the DHS to discuss its findings and present the documentation supporting their position. DHS informed outside counsel that they would have to follow the standard appeal process, which normally requires two or more months to complete. Classic Care Pharmacy instructed outside counsel to seek an ex parte temporary restraining order against the DHS for their failure to show cause regarding their actions. On May 8, 2002, in the Superior Court for the state of California, the Court granted Classic Care's ex parte request issuing a preliminary injunction against the DHS and reinstated Classic Care Pharmacy's medical provider number. The Court set May 24, 2002 as the date for the DHS to show cause. On May 24, 2002, the DHS was still not prepared to show cause. The court granted a 30-day extension. The Classic Care, Inc and Classic Care Pharmacy administrative appeal failed. Once the appeal took place the Superior court could no longer uphold our lack for due process claim and the DHS canceled Classic Care Pharmacy's medical provider number. The justice department has not taken any further action against Classic Care Pharmacy. Except as otherwise specifically indicated above, we believe that we do not have any material liability for any lawsuits, settlements, judgments, or fees of defense counsel which have not been paid or accrued as of December 31, 2002. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS On January 29, 2003 Steven Westlund was issued a promissory note by Effective Health for $2,500 for funds to the company. The note was due in thirty days. The note is still outstanding. On December 16, 2002 Steven Westlund was issued a promissory note by Effective Health for $8,500 for funds to the company. The note was due in thirty days. The note is still outstanding. THE APPOINTMENT OF POHL, MCNABOLA & BERG AS AUDITORS FOR KAIRE HOLDINGS INC. The Board of Directors of the Company has selected Pohl, McNabola, Berg & Company LLP, to audit the consolidated financial statements of the Company and its subsidiaries for the fiscal year ending December 31, 2003. Pohl, McNabola, Berg & Company LLP has served in this capacity since December 31, 1998. OTHER MATTERS The Board of Directors of the Company is not aware that any matter other than those described in this Information Statement is to be presented for the consent of the shareholders. 10 ADDITIONAL INFORMATION We are subject to the informational requirements of the Securities Exchange Act of 1934 and in accordance with the requirements thereof, file reports, proxy statements and other information with the Securities and Exchange Commission ("SEC"). Copies of these reports, proxy statements and other information can be obtained at the SEC's public reference facilities at Judiciary Plaza, Room 1024, 450 Fifth Street, N.W., Washington, D.C., 20549. Additionally, these filings may be viewed at the SEC's website at http://www.sec.gov and at Kaire Holdings ------------------ website at http://kaireholdingsinc.com. --------------------------- DISTRIBUTION OF INFORMATION STATEMENT The cost of distributing this Information Statement has been borne by us and certain shareholders that consented to the action taken herein. The distribution will be made by mail. Pursuant to the requirements of the Exchange Act of 1934, as amended, the Registrant has duly caused this Information Statement to be signed on its behalf by the undersigned hereunto authorized. By Order of the Board of Directors /s/ Steven Westlund --------------- Steven Westlund, Chief Executive Officer and Chairman May 6, 2003 Sun Valley, California 11 EXHIBIT A KAIRE HOLDINGS INC. NOTICE PUSUANT TO SECTION 228 OF THE GENERAL CORPORATION LAW OF THE STATE OF DELAWARE TO: ALL STOCKHOLDERS 1. PLEASE TAKE NOTICE THAT Stockholders owning at least a majority of the outstanding stock of Kaire Holdings Inc., by written consent dated March 28, 2003 have duly adopted the following resolution: "a resolution approving an amendment to the Corporation's Certificate of Incorporation, as amended, to provide for a stock combination (reverse split) of the Common Stock in an exchange ratio to be approved by the Board, ranging from one newly issued share for each two outstanding shares of Common Stock to one newly issued share for each two hundred outstanding shares of Common Stock and the approval of Pohl, McNabola, Berg & Company LLP, to audit the consolidated financial statements of the Company and its subsidiaries for the fiscal year ending December 31, 2003 . DATE: May 6, 2003 12 -----END PRIVACY-ENHANCED MESSAGE-----