-----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, JoAuVaFgcZXWoC4uXXs1hM6QpnDWAB7mx3shYjVWm+Xo7fqjxfOCaVkopkU2iemN perxG5v5cJ9pjvZl29ASsg== 0000893816-02-000017.txt : 20020515 0000893816-02-000017.hdr.sgml : 20020515 20020515150807 ACCESSION NUMBER: 0000893816-02-000017 CONFORMED SUBMISSION TYPE: 10-K/A PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20011231 FILED AS OF DATE: 20020515 FILER: COMPANY DATA: COMPANY CONFORMED NAME: INFOCROSSING INC CENTRAL INDEX KEY: 0000893816 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-COMPUTER PROCESSING & DATA PREPARATION [7374] IRS NUMBER: 133252333 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-K/A SEC ACT: 1934 Act SEC FILE NUMBER: 000-20824 FILM NUMBER: 02651450 BUSINESS ADDRESS: STREET 1: 2 CHRISTIE HEIGHTS STREET CITY: LEONIA STATE: NJ ZIP: 07605 BUSINESS PHONE: 2018404700 MAIL ADDRESS: STREET 1: 2 CHRISTIE HEIGHTS STREET CITY: LEONIA STATE: NJ ZIP: 07605 FORMER COMPANY: FORMER CONFORMED NAME: COMPUTER OUTSOURCING SERVICES INC DATE OF NAME CHANGE: 19930328 10-K/A 1 kb123101.txt SECOND AMENDMENT TO 123101 10K UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-K/A AMENDMENT #2 ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the year ended: DECEMBER 31, 2001 Commission file number: 0-20824 INFOCROSSING, INC. ------------------------------------ (Exact name of registrant as specified in its Charter) DELAWARE 13-3252333 -------------------------------- ---------------- (State or other jurisdiction of (IRS Employer incorporation or organization) Identification No.) 2 CHRISTIE HEIGHTS STREET LEONIA, NJ 07605 ------------------------------------ ----- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (201) 840-4700 Securities registered pursuant to Section 12(b) of the Exchange Act: NONE Securities registered pursuant to Section 12(g) of the Exchange Act: COMMON STOCK, $0.01 PAR VALUE PER SHARE --------------------------------------- (Title of Class) Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Sections 13 or 15(d) of the Securities Exchange Act of 1934, as amended, during the preceding 12 months, and (2) has been subject to such filing requirements for the past 90 days: [X] Yes [ ] No. Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of the registrant's knowledge, in a definitive proxy or information statement incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K [ ]. On March 15, 2002, the aggregate market value of the outstanding shares of voting stock held by non-affiliates of the registrant was approximately $21,762,000. On March 15, 2002, 5,342,426 shares of the registrant's Common Stock, $0.01 par value, were outstanding. This amendment is filed to add Robert Graham and remove Garry Lazarewicz as a Named Executive Officer in Items 11 and 12 of the previously-filed amendment. Page 1 ITEM 11. EXECUTIVE COMPENSATION COMPENSATION OF DIRECTORS AND EXECUTIVE OFFICERS The Summary Compensation Table below includes, for each of the years ended December 31, 2001, 2000, and 1999, individual compensation for services to the Company and its subsidiaries as paid to the Chief Executive Officer and the four executive officers of the Company whose salary exceeded $100,000 in the most recent twelve-month period (together, the "Named Executives").
SUMMARY COMPENSATION TABLE - ------------------------------------------------------------------------------------------------------------------------------------ Name and Principal All Other Position at Compensation ($) December 2001 * Year Annual Compensation Long Term Compensation Annual - --------------------------- ------ --------------------------------------------- --------------------------------- ----------------- Other Annual Awards Salary ($) Bonus ($) Compensation ($) - --------------------------- ------ ------------ --------------- ---------------- --------------------------------- ----------------- Securities Restricted Underlying Stock Awards Options/SARS (#) (#) - --------------------------- ------ ------------ --------------- ---------------- ---------------- ---------------- ----------------- Zach Lonstein 2001 $397,031 $225,000(a) $27,917(d) - - - Chief Executive Officer & 2000 386,979 175,000(b) 23,081(d) - 300 - Chairman 1999 242,788 72,519(c) 39,637(d) - 175,200 $5,000(e) - --------------------------- ------ ------------ --------------- ---------------- ---------------- ---------------- ----------------- Charles Auster * 2001 284,135 - - - - 12,207,917(f) CEO/President 2000 203,125 75,000(b) - 800,000(g) - 1,677,083(h) 1999 - - - - - - - --------------------------- ------ ------------ --------------- ---------------- ---------------- ---------------- ----------------- Robert Wallach 2001 397,031 225,000(a) 18,391(i) - - - President & Chief 2000 394,792 50,000(b) 10,185(i) - 50 - Operating Officer 1999 275,459 35,000(c) - - 150,000 - - --------------------------- ------ ------------ --------------- ---------------- ---------------- ---------------- ----------------- Robert O. Graham 2001 190,156 - - - - - Chief Technology 2000 164,667 90,000(b) - - 40,000 - Officer ** 1999 144,000 - - - 6,050 - - --------------------------- ------ ------------ --------------- ---------------- ---------------- ---------------- ----------------- Nicholas J. Letizia 2001 176,667 15,000(a) 6,000(j) - - - Sr. VP & General Counsel 2000 170,000 35,000(b) 6,000(j) - - - 1999 126,708 25,000(c) 6,000(j) - 20,000 - - --------------------------- ------ ------------ --------------- ---------------- ---------------- ---------------- ----------------- Thomas Laudati 2001 157,500 55,000(a) 7,200(j) - - - Sr. VP 2000 150,000 35,000(b) 7,200(j) - - - 1999 136,250 - 7,200(j) - - - - --------------------------- ------ ------------ --------------- ---------------- ---------------- ---------------- -----------------
* Or date of resignation. Mr. Auster resigned in November 2001. ** Mr. Graham ceased to be an employee of the Company on January 31, 2002. Page 2 (a) Bonus earned in 2001, paid in January 2002. (b) Bonus earned in 2000, paid in January 2001. (c) Bonus earned in the Company's then fiscal year ended October 31, 1999 and paid in February 2000. (d) Includes $19,750, $8,818, and $31,075 in 2001, 2000, and 1999 respectively, relating to a Company-provided vehicle and related expenses incurred for both business and personal use, and $8,166, $14,263, and $8,562 in 2001, 2000, and 1999, respectively, paid for a health club membership (See "Employment Agreements with Named Executive Officers" below). (e) Fee relating to Mr. Lonstein's guarantee of the Company's obligations in connection with the purchase of MCC Corporation. (See "Certain Relationships and Related Party Transactions" below). (f) Includes $9,822,917 of amortization of a Restricted Stock Award and the purchase of 535,594 common shares held by Mr. Auster for consideration of $2,385,000, consisting of $450,000 in cash plus the repayment of the balance due on his loan from the Company of $1,935,000 (See "Certain Relationships and Related Party Transactions" below). (g) See "Certain Relationships and Related Party Transactions" below. (h) Amortization of a the Restricted Stock Award (See "Certain Relationships and Related Party Transactions" below). (i) Includes $18,391 and $9,305 in 2001 and 2000, respectively, relating to a Company-provided vehicle and related expenses incurred for both business and personal use, and $1,305 and $880 in 2001 and 2000, respectively, paid for a health club membership (See "Employment Agreements with Named Executive Officers" below). (j) Vehicle allowance. The Named Executives may participate in certain group life, health, and other non-cash benefit plans, which are generally available to all Company employees. The Company also maintained 401(k) Savings Plans covering all eligible employees who have attained the age of 21 years and worked at least 1,000 hours in a one-year period. The Company may make matching contributions at the discretion of the Board of Directors. For the twelve-month periods ended December 31, 2001, 2000, and 1999, the Company did not make any matching contributions. The Company did not grant stock options to the Named Executives during the year ended December 31, 2001. The Company did not award any stock appreciation rights or reprice any stock options during the twelve months ended December 31, 2001. AGGREGATED OPTION EXERCISES AND YEAR-END OPTION VALUES The following table contains information concerning the stock options held by the Named Executives during the year ended December 31, 2001. No stock appreciation rights have been granted by the Company. Page 3
AGGREGATED OPTION EXERCISES DURING THE TWELVE MONTHS ENDED DECEMBER 31, 2001 AND YEAR-END OPTION VALUES - ------------------------------------------------------------------------------------------------------------------------------------ Securities Received from Exercise Number of Securities Underlying Value of Unexercised of Options during the Twelve Unexercised Options at December In-the-Money Options at Months ended December 31, 2001 31, 2001 (#) December 31, 2001 ($) (2) --------------------------------- -------------------------------- --------------------------------- Number Net Value Un- Un- Name of Shares Received ($)(1) Exercisable Exercisable Exercisable Exercisable - ------------------------- ------------ ------------------ --------------- --------------- -------------- --------------- Zach Lonstein 4,979 $ 29,094 (3) 210,500 15,000 $ 57,475 $ - Robert Wallach - - 447,050 30,000 400,917 - Robert O. Graham - - 35,385 19,665 - - Nicholas J. Letizia - - 12,800 15,200 - - Thomas Laudati - - 23,600 3,500 34,458 1,160
(1) The amount shown represents the aggregate excess of the market value of the shares of common stock as of the date of the exercise over the exercise price paid. (2) The amounts shown represent the aggregate excess of the market value of in-the-money shares of common stock underlying options at December 31, 2001 over the exercise price of those options. (3) This option for 25,000 shares was exercised through the surrender of 20,021 shares. The market price on the date of exercise approximated the exercise amount of the option. The difference was paid in cash. Page 4 Compensation of Directors Members of the Board of Directors who are not full-time employees of the Company are granted non-qualified options to purchase 1,250 shares of the Company's common stock for each meeting attended. Employees of the Company who are also Directors, and Directors who are also affiliates of the funds that have invested in the Company, do not receive compensation for their service as Directors. Upon their election to the Board of Directors, Ms. Perone and Messrs. Targoff and DaPuzzo each were granted a non-qualified option to purchase 25,000 shares of the Company's common stock. EMPLOYMENT AGREEMENTS WITH NAMED EXECUTIVE OFFICERS Effective as of November 1, 1999, Mr. Lonstein and the Company entered into an employment agreement with a three-year term with automatic one-year extensions. This agreement provides for an annual salary of $375,000 with increases in the second and third years of at least 5% per annum. The Options and Compensation Committee of the Board of Directors may provide for a greater annual increase and will set the parameters for the bonus calculation. The agreement also provides for a grant of a nonqualified option to purchase 150,000 shares of the Company's common stock at an exercise price equal to the market value of the stock on November 1, 1999, in accordance with the Plan. In addition, the agreement requires that the Company provide Mr. Lonstein a current model automobile, pay for all repairs, maintenance, and related expenses, and also purchase a health club membership for Mr. Lonstein and pay related expenses. The agreement also provides that the Company shall nominate Mr. Lonstein to serve as the Chairman of the Company's Board of Directors. Effective as of November 1, 1999, Mr. Wallach and the Company entered into an employment agreement with a three-year term with automatic one-year extensions. This agreement provides for an annual salary of $375,000 with increases in the second and third years of at least 5% per annum. The Options and Compensation Committee of the Board of Directors may provide for a greater annual increase and will set the parameters for the bonus calculation. The agreement also provides for a grant of a non-qualified option to purchase 150,000 shares of the Company's common stock at an exercise price equal to the market value of the stock on November 10, 1999, in accordance with the Plan. In addition, the agreement requires that the Company provide Mr. Wallach a current model automobile; pay for all repairs, maintenance and related expenses; and purchase a health club membership for Mr. Wallach and pay related expenses. In connection with the acquisition of AmQUEST, Inc. described in Item 13 "Certain Relationships and Related Party Transactions" below, on February 5, 2002, AmQUEST and Mr. Barrios entered into an employment agreement with a one year term with automatic three-month extensions. This agreement provides for an annual salary of $210,000, a vehicle allowance of $500 per month, an annual bonus of up to 30% of his salary to be determined by the Board of Directors of AmQUEST, and a one-time bonus of up to $32,000 based on certain operations as determined by the Chief Executive Officer of AmQUEST. The agreement also provides for a grant of a non-qualified option to purchase 70,000 shares of the Company's common stock at an exercise price equal to the market value of the stock on February 5, 2002, in accordance with the Plan. Page 5 COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION Prior to August 2001, the Options and Compensation Committee members were Ms. McCuen and Messrs. Zachem, Schiff, and Mr. Lee, a former Director who resigned in April 2001. Effective August 2001, the Options and Compensation Committee consisted of Messrs. Zachem and Lonstein, Ms. McCuen, and Ms. Perone. Ms. McCuen and Messrs. Zachem, Schiff, and (until the date of his resignation) Mr. Lee are non-employee directors who are also Managing Directors of affiliates of organizations that have an investment in the Company (See "Certain Relationships and Related Party Transactions" below). Mr. Lonstein is an executive officer of the Company. Ms. Perone is a non-employee director. OPTIONS AND COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION The Options and Compensation Committee of the Board of Directors of the Company is responsible for, among other matters, establishing policies applicable to the compensation of the Company's executive officers and reporting on such policies to the Board of Directors and stockholders; determining the salaries, incentive compensation and other remuneration of executive officers of the Company who are directors; and reviewing salaries, compensation and remuneration for all other officers of the Company. The Committee regularly reviews the effectiveness of the Company's executive compensation practices and revises them as appropriate. This is a report on the compensation philosophy of the Committee and its executive compensation activities during the twelve months ended December 31, 2001. REPORT ON EXECUTIVE COMPENSATION The Options and Compensation Committee of the Board of Directors administers the compensation of the executive officers of the Company. During 2001, the Options and Compensation Committee was composed of four directors, three of whom were not employed by the Company. The Options and Compensation Committee's recommendations are subject to approval by the full Board. The following report is submitted by the Options and Compensation Committee regarding compensation paid during 2001. The Company's compensation policies are designed to attract, motivate, and retain superior talent to enable the Company to achieve its business objectives and to align the financial interest of the executive officers with the stockholders of the Company. The compensation of executive officers consists of base compensation, participation in benefit plans generally available to employees, and in some instances, bonuses and/or options. In setting compensation, the Options and Compensation Committee strives to maintain base compensation for the Company's executive officers at levels which the Committee, based on its experience, believes are competitive with the compensation of comparable executive officers in similarly situated companies while relying upon stock options and the bonus plan to provide significant performance incentives. Executive officers are eligible to participate in a bonus plan. Awards under the bonus plan are determined by the Options and Compensation Committee. The Options and Compensation Committee relies significantly upon the recommendation of the Chief Executive Officer with respect to the bonus to be awarded to the other executive officers. The executive officers, as well as other key employees, may receive discretionary bonuses based upon a subjective evaluation of the performance of the Company and their contributions to the Company. Page 6 Each of the executive officers and certain key employees are eligible to receive awards under the Amended and Restated 1992 Stock Option and Stock Appreciation Rights Plan. The Plan will be used to align a portion of the officers' compensation with the stockholders' interest and the long-term success of the Company. In determining the number of options to be granted to each executive officer, the Options and Compensation Committee reviews the recommendations provided by the Chief Executive Officer with respect to the executive officers other than the Chief Executive Officer and makes a subjective determination regarding those recommendations. Grants of options must be approved by a majority of the non-employee members of the Options and Compensation Committee. The Compensation paid by the Company to Messrs. Lonstein, Wallach and Auster for 2001 was based upon employment agreements negotiated with each of these Executive Officers. Messrs. Letizia, Laudati and Graham do not have employment agreements with the Company that provide compensation arrangements. The Options and Compensation Committee has not conducted any surveys of compensation packages of executive officers in comparable companies, but believes, based on the individual experience of its members, that the compensation package for each Named Executive Officer for 2001 was reasonable based upon each executive officer's experience, level of responsibility, and the contributions made and expected to be made by each to the Company. See "Employment Agreements" for a description of the employment agreements. Options and Compensation Committee Zach Lonstein Samantha McCuen Kathleen A. Perone Tyler T. Zachem Page 7 STOCK PERFORMANCE GRAPH The accompanying graph compares cumulative total stockholder return on the Company's common stock with the NASDAQ Domestic Stock Index and the NASDAQ Computer and Data Processing Services Index (SIC Code 737). The graph assumes that $100 was invested in the Company's stock and each index on December 31, 1996. [GRAPH APPEARS HERE] STOCKHOLDER RETURN AS OF DECEMBER 31, 1996 1997 1998 1999 2000 2001 Company Common Stock $100 $286 $311 $721 $175 $174 NASDAQ Domestic Index 100 123 173 321 193 153 NASDAQ Computer and Data Processing Services Index 100 123 219 482 222 179 Page 8 ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT The following table sets forth certain information regarding the beneficial ownership of the Company's common stock as of April 1, 2002 by (a) all current Directors of the Company, (b the Named Executives, (c) all directors and executive officers as a group, and (d) any other person known by the Company to be the beneficial owner of more than 5% of its common stock. Beneficial ownership includes shares that the beneficial owner has the right to acquire within sixty days of the above date from the exercise of options, warrants, or similar obligations. If no address is shown, the address of the beneficial owner is in care of the Company.
BENEFICIAL OWNERSHIP OF THE COMPANY'S COMMON STOCK - ------------------------------------------------------------------------------------------------------------------ Number of Shares Percentage Name and Address of Beneficial Owner Beneficially Owned of Class - -------------------------------------------------------------------- ----------------------- --------------- Zach Lonstein (1) 1,707,925 27.8% - -------------------------------------------------------------------- ------- --------------- --------------- Robert B. Wallach (2) 526,475 8.2% - -------------------------------------------------------------------- ------- --------------- --------------- Nicholas J. Letizia (3) 12,800 * - -------------------------------------------------------------------- ------- --------------- --------------- Thomas Laudati (4) 23,600 * - -------------------------------------------------------------------- ------- --------------- --------------- Robert O. Graham (5) - - - -------------------------------------------------------------------- ------- --------------- --------------- Tyler T. Zachem DB Capital Partners, Inc. 130 Liberty Street - 25th Floor New York, NY 10006 (6) 2,980,441 33.4% - -------------------------------------------------------------------- ------- --------------- --------------- Frank L. Schiff DB Capital Partners, Inc. 130 Liberty Street - 25th Floor New York, NY 10006 (6) 2,980,441 33.4% - -------------------------------------------------------------------- ------- --------------- --------------- Richard A. Keller Sandler Capital Management 767 Fifth Avenue - 45th Floor New York, NY 10153 (7) 2,960,571 33.3% - -------------------------------------------------------------------- ------- --------------- --------------- Samantha McCuen Sandler Capital Management 767 Fifth Avenue - 45th Floor New York, NY 10153 (7) 2,960,571 33.3% - -------------------------------------------------------------------- ------- --------------- --------------- Kathleen A. Perone 22 Ocean Drive Avenue Monmouth Beach, NJ 07750 (8) 27,500 * - -------------------------------------------------------------------- ------- --------------- --------------- Michael B. Targoff 1330 Avenue of the Americas New York, NY 10019 (9) 28,750 * - -------------------------------------------------------------------- ------- --------------- --------------- Peter J. DaPuzzo 378 Taconic Road Greenwich, CT 06831 (10) 42,250 * - -------------------------------------------------------------------- ------- --------------- --------------- All Directors and executive officers as a group (15 persons) (11) 7,612,722 63.5% - -------------------------------------------------------------------- ------- --------------- ---------------
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BENEFICIAL OWNERSHIP OF THE COMPANY'S COMMON STOCK (CONTINUED) - ------------------------------------------------------------------------------------------------------- Number of Shares Percentage Name and Address of Beneficial Owner Beneficially Owned of Class - ---------------------------------------------------------- ----------------------- -------------- DB Capital Partners, Inc. 130 Liberty Street New York, NY 10006 (6) 2,980,441 33.4% - ---------------------------------------------------------- ------- --------------- -------------- Sandler Capital Management 767 Fifth Avenue New York, NY 10153 (7) 2,960,571 33.3% - ---------------------------------------------------------- ------- --------------- -------------- Sandler Capital Partners V, L.P. 767 Fifth Avenue New York, NY 10153 (12) 1,681,898 22.1% - ---------------------------------------------------------- ------- --------------- -------------- Sandler Capital Partners V FTE, L.P. 767 Fifth Avenue New York, NY 10153 (13) 689,053 10.4% - ---------------------------------------------------------- ------- --------------- -------------- Camden Partners One South Street - Suite 2150 Baltimore, MD 21202 (14) 944,435 14.7% - ---------------------------------------------------------- ------- --------------- -------------- Hilliard Farber Securities 45 Broadway New York, NY 10006 434,800 7.3% - ---------------------------------------------------------- ------- --------------- -------------- Charles F. Auster 41 Edgewood Road Summit, NJ 07901 332,852 5.6% - ---------------------------------------------------------- ------- --------------- --------------
* Less than 1% of Class (1) Includes 195,500 shares of common stock issuable upon exercise of vested options held by Mr. Lonstein. Also includes 750,000 shares that are subject to options held by DB Capital Investors, L.P., Sandler Capital Management, and other parties to a private placement of securities (see "Certain Relationships and Related Party Transactions" below). (2) Includes 477,050 shares of common stock issuable upon exercise of vested options held by Mr. Wallach. (3) Includes 12,800 shares of common stock issuable upon exercise of vested options held by Mr. Letizia. (4) Includes 23,600 shares of common stock issuable upon exercise of vested options held by Mr. Laudati. (5) Mr. Graham ceased to be an employee of the Company on January 31, 2002. Page 10 (6) Includes 1,092,615 common shares issuable upon conversion of 78,688.5 shares of Preferred Stock, including accrued dividends thereon, 1,512,826 common shares issuable upon exercise of warrants, and 375,000 common shares which may be purchased from Mr. Lonstein subject to an option. Messrs. Zachem and Schiff are Managing Directors of DB Capital Partners, Inc., which is the General Partner of DB Capital Partners, L.P., which in turn is the General Partner of DB Capital Investors, L.P., the owner of the shares of the Preferred Stock, warrants, and option. Messrs. Zachem and Schiff have shared voting and dispositive power over such Preferred Stock, warrants, and option noted above, and have disclaimed beneficial ownership for all of the shares beneficially owned by DB Capital Investors, L.P., except as to the extent of their pecuniary interest therein. DB Capital Investors, L.P. owns 50% of the outstanding shares of Preferred Stock. (7) Includes 1,085,331 common shares issuable upon conversion of 78,164 shares of Preferred Stock, including accrued dividends thereon, 1,502,740 common shares issuable upon exercise of warrants, and 372,500 common shares which may be purchased from Mr. Lonstein subject to options. Ms. McCuen and Mr. Keller are Managing Directors of Sandler Capital Management, which is the general partner of Sandler Investment Partners, L.P., which in turn is the general partner of five funds that collectively own the Preferred Stock, warrants, and options noted above. Ms. McCuen and Mr. Keller have shared voting and dispositive power over such Preferred Stock, warrants, and options. The five funds collectively own 49.7% of the outstanding shares of Preferred Stock. (8) Includes 32,500 shares of common stock issuable upon exercise of non- qualified options held by Ms. Perone. (9) Includes 28,750 shares of common stock issuable upon exercise of vested options held by Mr. Targoff. (10) Includes 36,250 shares of common stock issuable upon exercise of vested options held by Mr. DaPuzzo. (11) Includes 2,177,846 common shares issuable upon conversion of 156,852 shares of Preferred Stock and 3,015,566 common shares issuable upon exercise of warrants over which four directors exercise shared control. Also includes 851,360 shares of common stock issuable upon exercise of options collectively held by the fifteen directors and executive officers of the Company. (12) Includes 705,319 common shares issuable upon conversion of 50,796 shares of the Preferred Stock, including accrued dividends thereon, 976,579 common shares issuable upon exercise of warrants, and 242,075 common shares which may be purchased from Mr. Lonstein subject to an option. (13) Includes 288,961 common shares issuable upon conversion of 20,810 shares of Preferred Stock, including accrued dividends thereon, 400,092 common shares issuable upon exercise of warrants, and 99,175 common shares which may be purchased from Mr. Lonstein subject to an option. Page 11 (14) Includes 8,571 common shares issuable upon exercise of warrants received in connection with a prior loan to the Company, and 500,000 vested warrants received in connection with a Securities Purchase Agreement (See "Certain Relationships and Related Party Transactions", below). Includes the accounts of Camden Partners Strategic Fund II-A, L.P. Camden Partners Strategic Fund II-B, L.P., the Cahill, Warnock Strategic Partners Fund, L.P. and Strategic Associates, L.P., (the "Camden Entities"). Along with Cahill, Warnock Strategic Partners, L.P., each fund has shared voting and dispositive power over the total number of shares owned by the Camden Entities. Each of the Camden Entities disclaims beneficial ownership over any shares not held of record by it. Page 12 SIGNATURES In accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. INFOCROSSING, INC. May 14, 2002 /s/ --------------------------------------------- William B. Fischer - Senior Vice President & Chief Financial Officer -----END PRIVACY-ENHANCED MESSAGE-----