0001021408-01-509126.txt : 20011101
0001021408-01-509126.hdr.sgml : 20011101
ACCESSION NUMBER: 0001021408-01-509126
CONFORMED SUBMISSION TYPE: PRE 14C
PUBLIC DOCUMENT COUNT: 1
CONFORMED PERIOD OF REPORT: 20011120
FILED AS OF DATE: 20011031
FILER:
COMPANY DATA:
COMPANY CONFORMED NAME: RFP EXPRESS INC
CENTRAL INDEX KEY: 0000929425
STANDARD INDUSTRIAL CLASSIFICATION: INDUSTRIAL INSTRUMENTS FOR MEASUREMENT, DISPLAY, AND CONTROL [3823]
IRS NUMBER: 944453386
STATE OF INCORPORATION: DE
FISCAL YEAR END: 1231
FILING VALUES:
FORM TYPE: PRE 14C
SEC ACT: 1934 Act
SEC FILE NUMBER: 033-83526
FILM NUMBER: 1772191
BUSINESS ADDRESS:
STREET 1: 8080 DAGGETT STREET SUITE 220
CITY: SAN DIEGO
STATE: CA
ZIP: 92111
BUSINESS PHONE: 6196775580
MAIL ADDRESS:
STREET 1: 8080 DAGGETT STREET SUITE 220
CITY: SAN DIEGO
STATE: CA
ZIP: 92111
FORMER COMPANY:
FORMER CONFORMED NAME: IXATA GROUP INC
DATE OF NAME CHANGE: 20000207
FORMER COMPANY:
FORMER CONFORMED NAME: MATERIAL TECHNOLOGIES INC
DATE OF NAME CHANGE: 19970313
FORMER COMPANY:
FORMER CONFORMED NAME: MATERIAL TECHNOLOGY INC
DATE OF NAME CHANGE: 19970326
FORMER COMPANY:
FORMER CONFORMED NAME: SECURFONE AMERICA INC
DATE OF NAME CHANGE: 19971114
PRE 14C
1
dpre14c.txt
NOTICE OF AMENDMENT TO 1997 STOCK OPTION PLAN
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14C
Information Statement Pursuant to Section 14(c)
of the Securities Exchange Act of 1934 (Amendment No.___)
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
RFP Express Inc.
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(Name of Registrant As Specified In Its Charter)
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:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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[_] Fee paid previously with preliminary materials.
[_] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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[LOGO]
RFP Express Inc.
NOTICE OF AMENDMENT TO 1997 STOCK OPTION PLAN
TO BE EFFECTED NOVEMBER 20, 2001
To Stockholders of RFP Express Inc.:
On November 20, 2000, our Board of Directors approved an amendment to our
1997 Stock Option Plan to increase the number of shares of common stock
available for grant under the plan from 1,000,000 to 7,000,000.
As of October 30, 2001, the holders of a majority of our outstanding stock
approved the amendment to the 1997 Stock Option Plan by a written consent signed
by each of these stockholders in accordance with Delaware law.
The amendment to the 1997 Stock Option Plan will become effective at the
close of business on November 20, 2001.
This letter and the accompanying information statement are being
distributed to you, our stockholders, in accordance with the requirements of (S)
228(d) of the Delaware general corporation law and (S) 14(c) of the Securities
Exchange Act of 1934.
By Order of the Board of Directors,
John C. Riener
Chief Executive Officer
October 30, 2001
RFP EXPRESS INC.
INFORMATION STATEMENT
General Information for Shareholders
The Board of Directors believes it is in the best interest of the Company
to amend the 1997 Stock Option Plan (the "Plan") to increase the number of
shares of common stock available from 1,000,000 to 7,000,000 to attract and
retain officers, other key employees and consultants and provide them with
appropriate incentives and awards for superior performance. The Plan is
intended to advance the interests and long-term success of the Company by
encouraging stock ownership among those who participate in the Plan and thereby
increase the personal involvement of the participants with the fortunes of the
Company.
This information statement is being furnished to you in connection with an
amendment to our 1997 Stock Option Plan to increase the number of shares of
common stock available from 1,000,000 to 7,000,000. The amendment was approved
by our Board of Directors on November 20, 2000 and by the holders of a majority
of our outstanding stock by a written consent signed by each of these
stockholders as of October 30, 2001 in accordance with (S) 228 of the Delaware
general corporation law.
Pursuant to (S) 228 of Delaware law and (S) 14(c) of the Securities
Exchange Act of 1934, we are required to provide prompt notice of the taking of
the corporate action without a meeting to the stockholders of record who have
not consented in writing to the action. This information statement is intended
to provide that notice. The amendment is the only matter covered by this
information statement. We are mailing this information statement on or about
October 31, 2001 to our stockholders of record as of the close of business on
October 29, 2001. You are not entitled to any dissenters' or appraisal rights
under Delaware law as a result of the approval of this amendment.
WE ARE NOT ASKING YOU FOR A PROXY AND
REQUEST THAT YOU NOT SEND US A PROXY
2
Vote Required
The stockholder vote required to approve the amendment to the 1997 Stock
Option Plan is the affirmative vote of the holders of a majority of our
outstanding shares of voting stock. There are 14,825,453 shares of our common
stock, par value $0.001 per share, and 2,085,461 shares of our Series C
convertible preferred stock, par value $0.001 per share, outstanding. The
holders of the preferred and common stock vote together as a single class on all
matters presented for the vote of our stockholders. Each holder of common stock
is entitled to one vote for each share held, while each preferred stockholder
may cast a number of votes equal to the number of shares of common stock
issuable upon conversion of his or her preferred stock, presently ten shares of
common for each preferred share. The record date for purposes of determining
the number of outstanding shares of stock, and for determining stockholders
entitled to vote, is the close of business on October 29, 2001. As of October
29, 2001, the Company had outstanding 14,825,453 shares of common stock and
2,085,461 shares of preferred stock, or, giving effect to the ten for one voting
rights of the preferred stock, shares entitled to a total of 35,680,153 votes.
Therefore, the affirmative vote of the holders of shares entitled to 17,840,077
votes is required to approve the amendment.
Vote Obtained
Section 228 of the Delaware general corporation law provides that the
written consent of the holders of outstanding shares of voting stock, having not
less than the minimum number of votes that would be necessary to authorize or
take the action at a meeting at which all shares entitled to vote on the matter
were present and voted, may be substituted for a special meeting. In order to
eliminate the cost and delay involved in holding a special meeting and in order
to effect the expansion of the Plan as soon as possible, the Board of Directors
decided to obtain the written consent of the holders of a majority of our
outstanding voting shares.
The directors, executive officers and other stockholders who adopted the
resolution to amend the Plan collectively own 6,061,875 shares of common stock
and 1,895,461 shares of preferred stock, or 70.1% of the Company's outstanding
voting stock. The amendment to the Plan will be effective at the close of
business on November 20, 2001. At that time Section 3 of the Plan, captioned
"Shares Available under the Plan," will be revised to increase the number of
shares available under the Plan from 1,000,000 to 7,000,000.
Description of the Amended 1997 Stock Option Plan
The Plan was adopted by the Board of Directors in October 1997 and the
amendment to the Plan was adopted by the Board of Directors in November 2000.
The Plan, as amended, provides for the grant of options to purchase an aggregate
of 7,000,000 shares of the Company's common stock. The Plan provides for the
granting of "incentive stock options" within the meaning of (S) 422 of the
Internal Revenue Code of 1986, as amended, and "nonqualified stock options"
which are not intended to qualify under any provisions of the Code.
3
Stock options are rights to purchase shares of common stock at a price per
share that is determined by the Board on the date that the stock options are
granted. The exercise price per share of common stock payable upon the exercise
of nonqualified stock options is not restricted. The exercise price of
incentive stock options must be at least equal to the fair market value of the
stock on the date of the grant. Holders of incentive stock options qualify for
certain favorable tax treatment. See "Summary of Federal Income Tax
Consequences."
Options granted under the Plan are subject to the following restrictions,
among others: (1) the price per share exercise price of incentive stock options
must be equal to or greater than the fair market value of a share of common
stock on the date of grant; (2) no option may be exercisable after the
expiration of ten years from the date of its grant; and (3) options granted
under the Plan are not transferable during the lifetime of the option holder,
except by will or the laws of descent and distribution or in the event of the
option holder's legal incapacity, by his or her guardian or legal representative
acting in a fiduciary capacity on behalf of the option holder under state law
and court supervision.
The Plan is administered by the Board of Directors of the Company. The
Board has sole discretion and authority to choose eligible individuals to
receive options and to determine the terms of the options granted, including the
exercise price, the number of shares subject to the option and the time of the
exercise.
The Plan authorizes the Board to establish vesting provisions with respect
to each option grant, regarding the period of continuous employment or
continuous engagement of the consulting services of the option holder with the
Company that is necessary before an option will become exercisable. Any grant
may provide for the earlier exercise of the option in the event of a change in
control of the Company.
As of September 30, 2001, options to purchase 5,766,900 shares of common
stock were outstanding under the Plan and options to purchase 1,233,100 shares
of stock remained available for grant. Our common stock is traded in the Nasdaq
Over-the-Counter Bulletin Board. On October 23, 2001, the closing sale price of
our common stock was $0.05 per share.
Summary of Federal Income Tax Consequences
Nonqualified Stock Options
Generally. An option holder generally will not recognize income upon the
grant of a nonqualified stock option. If an option holder receives unrestricted
shares of common stock upon the exercise of a nonqualified stock option, he will
normally recognize ordinary income at the time of exercise equal to the excess
of the fair market value, at the time of exercise, of the optioned common stock
received over the exercise price. When the option holder disposes of the
shares, capital gain will be recognized, either long or short-term depending on
the holding period beginning on the date the shares are acquired.
4
Special Rules Applicable to Option Holders Subject to Section 16(b) of the
Exchange Act. The tax consequences to option holders who are Company insiders
subject to (S) 16(b) of the Exchange Act may differ from the tax consequences
described above. In the case of such an option holder, ordinary income will
generally be recognized upon exercise only if six months have elapsed since the
date of the grant.
Tax Consequences to the Company. To the extent that an option holder
recognizes ordinary income, the Company or subsidiary for which the option
holder performs services will generally be entitled to a corresponding
deduction. The deduction is allowed in the tax year in which the option holder
is required to include the amount in income.
Incentive Stock Options
Generally. An option holder will not recognize income upon the grant of an
incentive stock option. In addition, an option holder will not recognize income
upon the exercise of an incentive stock option if he or she satisfies certain
employment and holding period requirements. To satisfy the employment
requirement, an option holder generally must exercise the option not later than
three months after he ceases to be an employee of the Company or its parent or
subsidiary (one year if he ceases to be an employee due to disability). To
satisfy the holding period requirement, an option holder must hold the optioned
common stock for more than two years from the grant of the option and more than
one year after the common stock is transferred to him. If these requirements
are satisfied, upon the sale of the common stock, the option holder will be
taxed at long-term capital gains rates on any gain, measured by the difference
between his or her basis in the common stock and the net proceeds of the sale.
Disqualifying Disposition. If shares of common stock acquired upon the
timely exercise of an incentive stock option are sold, exchanged or otherwise
disposed of without satisfying the holding period requirement, the option holder
will usually recognize ordinary income at the time of disposition equal to the
amount of the excess of the fair market value of the optioned common stock on
the date of the exercise of the incentive stock option over the exercise price.
Alternative Minimum Tax. An option holder generally must include in
alternative minimum taxable income the amount by which the amount paid for the
option is exceeded by the option's fair market value at the time the rights to
the stock are freely transferable or not subject to a substantial risk of
forfeiture.
Tax Consequences to the Company. The granting of an incentive stock
option, or the exercise thereof, will generally not result in a deduction for
the Company. However, to the extent that an option holder recognizes ordinary
income as the result of a disqualifying disposition, as described above, the
Company will generally be entitled to a corresponding deduction.
5
Security Ownership of Principal Holders and Management
The following table includes, as of September 30, 2001, information
regarding the beneficial ownership of our common stock, by each stockholder
known by us to be the beneficial owner of more than 5% of the outstanding shares
of the common stock, each director, each executive officer included in our 2000
executive compensation table and all directors and executive officers as a
group.
Beneficial Ownership (2)
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Common Common Series C Series C
Common Stock Stock Preferred Preferred
Name and Address (1) Stock Warrants Options (3) Stock (4) Warrants (5) Total (6) Percent (7)
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Zimri C. Putney (8) -- 1,500,000 -- 1,895,461 1,860,000 39,054,610 72.5%
NextGen Fund II, L.L.C. -- 900,000 -- 1,125,277 1,104,000 23,192,770 61.0%
12701 Fair Lakes Circle
Suite 690
Fairfax, VA 22033
NextGen SBS Fund II, L.L.C. -- 600,000 -- 750,184 736,000 15,461,840 51.1%
12701 Fair Lakes Circle
Suite 690
Fairfax, VA 22033
Michael M. Grand (9) 4,300,000 -- 50,000 -- -- 4,350,000 29.2%
Michael W. Wynne 500,000 -- -- 90,000 90,000 2,300,000 13.8%
901 Mackall Avenue
McLean, VA 22101
Fred Gluckman (10) 1,761,875 100,000 115,000 -- -- 1,976,875 13.1%
Andreoli Family Trust (11) 1,761,875 -- -- -- -- 1,761,875 11.9%
3131 Liberty Circle S.
Las Vegas, NV 89121
Gerald R. McNichols 100,000 -- -- 90,000 90,000 1,900,000 11.4%
23349 Parsons Road
Middleburg, VA 20117
Robert A. Steiner 242,696 -- 250,000 -- -- 492,696 3.3%
840 17th Street, #309
San Diego, CA 92101
John C. Riener -- -- 500,000 -- -- 500,000 3.3%
Paul B. Silverman 100,000 -- 200,000 -- -- 300,000 2.0%
9520 Center Street
Vienna, VA 22181
6
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Common Common Series C Series C
Common Stock Stock Preferred Preferred
Name and Address (1) Stock Warrants Options (3) Stock (4) Warrants (5) Total (6) Percent (7)
----------------------------------------------------------------------------------------------------------------------------
Andrew H. Kent -- -- 170,000 -- -- 170,000 1.1%
2613 N. Potomac Street
Arlington, VA 22207
Edward C. Groark -- -- -- -- -- -- 0.0%
All current directors 6,061,875 1,600,000 665,000 1,895,461 1,860,000 39,054,610 71.5%
and executive officers
as a group (5 individuals)
------------------------
(1) Unless otherwise indicated, the address of each of the beneficial owners is
c/o RFP Express Inc., 8989 Rio San Diego Drive #160, San Diego, California
92108.
(2) Unless otherwise indicated, the Company believes that all persons named in
the table have sole voting and investment power with respect to all shares
of Common Stock beneficially owned by them. A person is considered to be
the beneficial owner of securities that can be acquired by that person
within 60 days of September 30, 2001 upon the exercise of warrants or
option or the conversion of convertible securities.
(3) Options to purchase shares of Common Stock that are presently or will
become exercisable within 60 days.
(4) Each share of Series C Preferred Stock is convertible without additional
consideration into ten shares of Common Stock, subject to adjustment for
stock splits, stock dividends and other recapitalizations and
reorganizations. The holders of the Series C Preferred Stock and Common
Stock vote together as a single class on all matters presented for the vote
of the Company's stockholders. Each preferred stockholder may cast a
number of votes equal to the number of shares of Common Stock issuable upon
conversion of his or her preferred stock.
(5) Warrants to purchase shares of Series C Preferred Stock for $1.00 per share
exercisable at any time until ten years from the date of issuance. Each
share of Series C Preferred Stock is convertible without additional
consideration into ten shares of Common Stock, subject to adjustment for
stock splits, stock dividends and other recapitalizations and
reorganizations.
(6) Assumes that the beneficial owners' shares of Series C Preferred Stock have
been converted into Common Stock, and warrants to purchase shares of Series
C Preferred Stock have been exercised and converted into Common Stock.
(7) Each beneficial owner's percent ownership is determined by assuming that
options or warrants that are held by that person (but not those held by any
other person) and which are exercisable within 60 days have been exercised
and that shares of Series C Preferred Stock that are held by that person
(but not those held by any other person) have been converted into Common
Stock.
7
(8) Includes the following shares owned by NextGen Fund II, L.L.C. and NextGen
SBS Fund II, L.L.C.: (i) warrants to purchase 1,500,000 shares of Common
Stock; (ii) 1,875,461 shares of Series C Preferred Stock; and (iii)
warrants to purchase 1,840,000 shares of Series C Preferred Stock. Mr.
Putney is a member of and is the managing director of the managing member
of NextGen Fund II, L.L.C. and NextGen SBS Fund II, L.L.C. Mr. Putney
disclaims beneficial ownership of the shares held by NextGen Fund II,
L.L.C. and NextGen SBS Fund II, L.L.C.
(9) Includes 4,300,000 shares of Common Stock held by Montpilier Holdings,
Inc., a Nevada corporation. Mr. Grand has sole power to vote or direct the
voting of shares held by Montpilier.
(10) Includes 1,761,875 shares of Common Stock held by the Gluckman Family Trust
of which Mr. Gluckman is sole trustee. Also includes 100,000 warrants to
purchase Common Stock held by Tel.n.form, Inc., a California corporation of
which Mr. Gluckman is President.
(11) Vera Ellen Andreoli is sole trustee of the Andreoli Family Trust.
____________________
By Order of the Board of Directors,
John C. Riener
Chief Executive Officer
October 30, 2001
8