UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
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[ ] Soliciting Material Pursuant to Sec.240.14a-12
Fighton Succession Corp.
- ------------------------
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FIGHTON SUCCESSION CORPORATION
5969 Cattleridge Blvd., Suite 200
Sarasota, Florida 34232
(941) 552-2140
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
FEBRUARY 25, 2002
1:00 P.M. (EST)
To Our Shareholders:
Notice is hereby given of a Special Meeting of Shareholders (the "Special
Meeting") of Fighton Succession Corporation (the " Company") to all of the
shareholders of the Company. The Special Meeting will be held on February 25,
2002 at the Key Card offices at 5969 Cattleridge Blvd., Suite 200, Sarasota,
Florida 34232 at 1:00 p.m. Eastern Standard Time for the following purposes:
1. Change of Name of the Corporation
2. Approval of Reorganization
3. Election of New Board
4. Standby Authority for Follow-up Merger
5. Ratification of Executive Stock Option Plan
6. Creation of a Class of Convertible Preferred Shares
7. Appointment of J. H. Cohen & Company as Auditors
Consideration and action upon such other business as may properly come
before this meeting or any adjournment thereof.
The enclosed Proxy Statement includes information relating to these
proposals.
All shareholders of record of the Company's common stock at the close of
business on January 15, 2002 are entitled to notice of and to vote at the Annual
Meeting or any adjournment or postponement thereof. At least a majority of the
outstanding shares of common stock of the Company present in person or by proxy
is required for a quorum.
By Order of the Board of Directors
--------------------------------
B. Stephen May
Chairman of the Board
PROXY STATEMENT
===============
FIGHTON SUCCESSION CORPORATION
(TO BE KNOWN AS KEY CARD COMMUNICATIONS, INC.)
(A CALIFORNIA CORPORATION)
SPECIAL MEETING OF SHAREHOLDERS
FEBRUARY 25, 2002
GENERAL INFORMATION & INCORPORATION BY REFERENCE
THIS PROXY STATEMENT IS BEING MAILED TO ALL SHAREHOLDERS OF RECORD IN
CONNECTION WITH THE SOLICITATION OF THEIR VOTE BY THE BOARD OF DIRECTORS OF
FIGHTON SUCCESSION CORPORATION ("the Company" or "Fighton") with regard to a
Special Shareholder Meeting to be held on February 25, 2002 at 1:00 p.m. at the
Key Card offices at 5969 Cattleridge Road, Suite 200, Sarasota, Florida,
Telephone: (941) 552-2140. This Proxy Statement should be reviewed in
connection with the enclosed copy of the Current Report filed on SEC Form 10-QSB
for the period ending September 30, 2001 and outlining the recent reorganization
requiring the within Special Meeting.
VARIOUS ITEMS OF IMPORTANT INFORMATION AND FINANCIAL STATEMENTS FOR THE
COMPANY RELATED TO THIS PROXY STATEMENT ARE SET-OUT IN THE ENCLOSED QUARTERLY
REPORT ON FORM 10-QSB FOR THE PERIOD ENDING SEPTEMBER 30, 2001. THE COMPANY'S
EARLIER FILINGS, INCLUDING THE 10-KSB FILING FOR THE PERIOD ENDING DECEMBER 30,
2000, REFLECTS AN INACTIVE PRE-REORGANIZATION STATUS FOR THE COMPANY AND IS NOT
DEEMED RELEVANT. ANY SHAREHOLDER, OR OTHER INTERESTED PARTY, MAY OBTAIN A COPY
OF THE PRE SEPTEMBER 30, 2001 FILINGS FROM THE COMPANY OR DIRECTLY FROM THE SEC
ELECTRONIC FILING SYSTEM ONLINE AT WWW.SEC.GOV/EDGAR.SHTML. THE DETAILED
INFORMATION SET-OUT IN THE CURRENT 10-QSB MAY BE RELEVANT IN REVIEWING THIS
PROXY STATEMENT, BUT IS NOT NECESSARILY REPEATED IN THIS DOCUMENT. ACCORDINGLY,
EACH SHAREHOLDER SHOULD REFER TO THE ENCLOSED FORM 10-QSB BEFORE COMPLETING
THEIR PROXY BALLOT.
In addition the Reorganization Agreement, summarized herein and related to
the solicitation of proxies, may be viewed by any shareholder upon request to
the Company.
Proxies voted in accordance with the accompanying ballot form, which are
properly executed and received by the Secretary to the Company prior to the
Annual Meeting, will be voted.
REVOCABILITY OF PROXY
A shareholder returning the enclosed proxy ballot has the power to revoke
it at any time before it is exercised and may do so by written notice to the
Secretary of the Company at the address set forth above, effective upon receipt
of such written notice, or by voting in person at the Annual Meeting.
Attendance at the Annual Meeting, in and of itself, will not constitute
revocation of a proxy.
SOLICITATION AND VOTING PROCEDURES
The record date for the determination of shareholders entitled to vote at
the Annual Meeting is the close of business on December 15, 2001.
As of December 31, 2001, the authorized capital stock of Fighton consisted
of (i) 50,000,000 shares of common stock, no par value, of which 19,930,260
shares are issued and outstanding. All outstanding shares of Fighton common
stock are validly issued, fully paid for and nonassessable with no personal
liability attaching to the ownership thereof. All shares are free of
pre-emptive rights and free and clear of all liens, claims and encumbrances.
There are no cumulative voting provisions.
Shares entitled to vote will be determined based upon the official
shareholder record of December 15, 2001. Actual votes cast will be determined
by the physical counting of votes in person or proxy by the Inspector of
Elections to be appointed prior to the meeting by the Board of Directors. Any
dispute as to votes or entitlement to vote will be decided by majority vote of
the Board of Directors. Abstentions and broker non-votes will not be counted
for either quorum or ballot purposes.
QUORUM
As to each item to be voted upon in this Proxy, a numerical majority of the
issued and outstanding shares needed to pass such measure must be present or
voted by Proxy at the meeting, as determined by the Inspector of Elections at
the time of meeting. Each proposal to be voted upon will only be adopted by a
majority vote of shares voted at the meeting, provided a quorum of 9,965,130
shares is present. That is, each item will be adopted by an affirmative vote of
not less than 9,965,131 votes.
There are no matters to be voted upon as described by this Proxy upon which
management will proceed absent majority shareholder approval as described above.
ABSTENTIONS
Abstentions will be counted for purposes of determining both (i) the
presence or absence of a quorum for the transaction of business and (ii) the
total number of Votes Cast with respect to a proposal (other than the election
of directors). In the absence of controlling precedent to the contrary, the
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Company intends to treat abstentions in this manner. Accordingly, abstentions
will have the same effect as a vote against the proposal.
BROKER NON-VOTES
Broker non-votes will be counted for purposes of determining the presence
or absence of a quorum for the transaction of business, but will not be counted
for purposes of determining the number of Votes Cast with respect to the
particular proposal on which the broker has expressly not voted. Accordingly,
broker non-votes will not affect the outcome of the voting on a proposal that
requires a majority of Votes Cast.
STOCK OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The Company knows of no person or group, except the following, which, as of
the date of this Proxy Statement, beneficially owns and has the right to vote
more than 5% of the various voting shares in the Company:
NAME AND ADDRESS OF BENEFICIAL OWNER VOTING SHARES BENEFICIALLY OWNED PERCENT OF CLASS
- ------------------------------------ -------------------------------- ----------------
1. B. Stephen May 10,000,000 50%
2. Clifford Wildes 1 1,100,000 5%
3. Mackenzie Shea and Affiliates 2 2,700,000 14%
4. Newpont Fiduciaries and Nominees 3 1,200,000 5%
<FN>
1 Mr. Clifford Wildes is to be issued an additional 500,000 shares as a signing bonus
which are not reflected in the above total and are anticipated to be issued as restricted stock
in the first quarter of 2002.
2 The Mackenzie Shea interest has been determined by aggregating the Key shareholders that
will receive Fighton shares that are also principals, as well as officers and/or directors in
Mackenzie Shea. Directly held 900,000 shares by Mackenzie Shea; 600,000 shares in Chicago Trust
Company of California custodian IRA FBO Robert W. Kendrick, the President of Mackenzie Shea;
600,000 shares in Chicago Trust Company of California, custodian IRA FBO Todd A. Ellsworth a
Director of Mackenzie Shea; William Stratton as shareholder of Mackenzie Shea 600,000 shares in
Chicago Trust Company of California, custodian IRA FBO of William Stratton.
3 In addition to the above shares, Newpont has been granted options to acquire up to 1
million additional shares at $0.50/share through March 2001 for funding efforts. They have
exercised $100,000 of the option for 200,000 of the shares related above. The Board does not
believe that funding options to third parties require shareholder approval.
MATTERS SUBJECT TO SHAREHOLDER VOTE
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MERGER WITH KEY CARD COMMUNICATIONS, INC.
Forward-Looking Information
Certain statements in this section and elsewhere in this report are
forward-looking in nature and relate to trends and events that may affect the
Company's future financial position and operating results. Such statements are
made pursuant to the safe harbor provisions of the Private Securities Litigation
Reform Act of 1995. The terms "expect," "anticipate," "intend," and "project"
and similar words or expressions are intended to identify forward-looking
statements. These statements speak only as of the date of this report. The
statements are based on current expectations, are inherently uncertain, are
subject to risks, and should be viewed with caution. Actual results and
experience may differ materially from the forward-looking statements as a result
of many factors, including changes in economic conditions in the markets served
by the Company, increasing competition, fluctuations, in raw materials and
energy prices, and other unanticipated events and conditions. It is not
possible to foresee or identify all such factors. The Company makes no
commitment to update any forward-looking statement or to disclose any facts,
events, or circumstances after the date hereof that may affect the accuracy of
any forward-looking statement.
This section of the Proxy Statement describes certain aspects of the
acquisition of Key Card Communications, Inc., a privately held Florida
corporation ("Key Card"), to become a wholly owned subsidiary of the Company.
As of August 31, 2001, the Company deemed that it had closed an acquisition of
all of the issued and outstanding shares of Key Card in exchange for
approximately 94% of its issued and outstanding shares of Fighton whereby Key
Card became a wholly owned and sole operating subsidiary of Fighton Succession
Corporation. As Fighton did not have any prior assets, revenues, operating
business or history, the Key Card business and operations became the sole
operating business and purpose of the Company. In like manner, by majority
shareholder consent, the interim directors were elected as nominees of Key Card
to act in such capacity until voted upon pursuant to this proxy proposal.
Further, the name of the Company is proposed to be changed to Key Card, Inc. to
reflect the nature of the new management and business purpose of the public
entity. The Board of Directors has not presently determined whether to complete
a formal merger of the entities with a possible third party merger entity to
change the place of domicile to the State of Nevada and to create a single
operating company, but will seek standby authority to complete such merger or
any part thereof by soliciting your votes in favor of that proposition as part
of this proxy solicitation. The nature of this type of reorganization, whereby
the public company essentially takes on the business name, management and all
other operating attributes of the acquired private company is sometimes referred
to as a "reverse acquisition" and such term may be used from time to time in the
Proxy Statement and referenced documents. Information concerning the business
and management of Key Card set forth below and elsewhere has been furnished by
management of such entity.
Based upon the foregoing general description of the reorganization to be
ratified by this Proxy Solicitation, Fighton is asking and soliciting through
its management your affirmative vote upon the following specific proposals:
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1. A PROPOSAL TO FORMALLY CHANGE THE NAME OF "FIGHTON SUCCESSION CORPORATION"
TO "KEY CARD COMMUNICATIONS, INC." WITH RATIFICATION OF THE CHANGE OF NAME
OF THE OPERATING SUBSIDIARY "KEY CARD COMMUNICATIONS, INC." TO "KEY CARD,
INC."
2. SOLICIT YOUR VOTE TO FORMALLY ELECT THE FOLLOWING INTERIM DIRECTORS WHICH
WERE PREVIOUSLY APPOINTED BY A MAJORITY SHAREHOLDER CONSENT RESOLUTION
UNTIL THE NEXT REGULAR MEETING OF SHAREHOLDERS-
A. MR. B. STEPHEN MAY AS DIRECTOR AND CHAIRMAN OF THE BOARD.
B. MR. MICHAEL REJBENI, DIRECTOR
C. MR. ROD BRAIDO, DIRECTOR
3. FORMALLY APPROVE AND RATIFY THE REORGANIZATION PREVIOUSLY APPROVED BY THE
PRIOR BOARD OF DIRECTORS OF THE COMPANY AND RATIFIED BY MAJORITY
SHAREHOLDER CONSENT AS GENERALLY DESCRIBED ABOVE AND AS REFERENCED AND
DESCRIBED IN THE10-QSB REPORT.
4. PROVIDE STANDBY AUTHORITY AND APPROVAL TO THE BOARD OF DIRECTORS TO
COMPLETE A MERGER OF THE PARENT "FIGHTON SUCCESSION CORPORATION" AND ITS
EXISTING SUBSIDIARY "KEY CARD COMMUNICATIONS, INC." WITH A THIRD
CORPORATION TO BE FORMED IN NEVADA FOR THE PURPOSES OF CREATING A SINGLE
OPERATING COMPANY WITH A NEVADA DOMICILE. IT SHOULD BE UNDERSTOOD THAT
APPROVAL OF THIS AUTHORITY SHALL CONSTITUTE AN AFFIRMATIVE VOTE TO A
MERGER, BUT THAT THE ULTIMATE DECISION TO PROCEED WILL BE LEFT WITH THE
BOARD OF DIRECTORS WHO MAY, WITHIN ONE YEAR FROM THE DATE OF SUCH
RESOLUTION, DECIDE WHETHER TO IMPLEMENT SUCH MERGER OR NOT. ANY DECISION TO
IMPLEMENT SUCH MERGER WILL BE PROMPTLY COMMUNICATED TO SHAREHOLDERS AND AN
8-K FILED CONFIRMING THE COMPLETION OF SUCH MERGER.
5. RATIFICATION OF EXECUTIVE/DIRECTOR STOCK OPTION PLAN.
6. CREATE A NEW CLASS OF CONVERTIBLE PREFERRED SHARES, 10,000,000 SHARES
AUTHORIZED AT $0.001.
7. APPOINT J. H. COHEN & COMPANY AS THE INDEPENDENT AUDITORS FOR THE COMPANY.
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Each of the specific proposals related to the reorganization will be
discussed further in these proxy materials. It should be understood that
management favors each of these proposals and is soliciting and encouraging your
vote in favor of the proposals, but that you will be afforded the opportunity in
the enclosed Proxy Ballot to vote in favor, against or abstain from each of the
foregoing proposals. Additionally, each shareholder will be given the
opportunity in the proxy ballot form to write in other nominees for directors
and to vote their shares on other nominees; or, alternatively, to vote for or
against or abstain from the election of the proposed slate of nominees described
above. Following there will be a further biographical description of the
existing interim Board Members and nominees for your review.
Finally, as part of a general discussion of the proxy proposals, each
shareholder is encouraged to review the concurrently submitted and enclosed
10-QSB report for the period ending September 30, 2001 which contains additional
information about Fighton and Key Card including business operations, and
unaudited consolidated financial statements. This report, as supplied to
shareholders and incorporated by this reference, also discusses certain risk
factors such as the fact that Key Card has not obtained profitability and that
the accountants have expressed a "going concern" reservation about the Company,
as well as a description of various litigation matters in which Key Card is
presently engaged and certain potential conflicts of interest with its
management. All of these are significant risk factors which should be reviewed
and considered by shareholders of the Company in casting their votes pursuant to
this proxy solicitation.
The Reorganization Closing Agreement contains a number of representations
made by both Key Card any Fighton. Among other items, each of the entities
represented that it was in good standing in its state of domicile; that the
Reorganization Agreement was duly authorized by the respective boards of
directors; that the financial information provided to the other entities was
true and correct in all material respects; that there had been no material
changes since the date of the financial information; that there were no legal or
administrative actions pending or contemplated which involved the entities or
their properties, except as disclosed in the Reorganization Agreement; and that
all federal and state corporate tax returns had been filed and all taxes paid. A
copy of this Reorganization Closing Agreement is not attached, but may be
reviewed by any shareholder or interested party, by contacting the Company at
the address above, or can be reviewed as an Exhibit to an earlier 8-K filing by
the Company with the Securities and Exchange Commission (SEC) at its Website:
www.sec.gov/edgar.shtml.
Prior to the closing of the transaction, each of the entities that were
signatories to the Reorganization Agreement were granted full access to any
material information about each entity, its business or properties. The
entities conducted their business in the same manner prior to closing as they
had done prior to executing the Reorganization Agreement.
Each shareholder in Fighton will be afforded dissenting shareholder
appraisal rights under California law pursuant to a separate dissenting
shareholders packet being delivered to you with this Proxy Statement. In
essential terms, shareholder appraisal rights afford a remedy and procedures
whereby the dissenting shareholders can ask to be "bought out" rather than to
remain as shareholders in the reorganization or merger if they do not believe
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they are receiving fair value for their shares as a result of the
reorganization. The foregoing only purports to be a general summary of the
nature and purpose of minority shareholder appraisal rights and should not be
viewed as a complete or exclusive explanation. Each investor should review
carefully the enclosed package of material pertaining to dissenting shareholder
appraisal rights and consult with such legal or other advisors as they may deem
appropriate.
BUSINESS AND DESCRIPTION OF KEY CARD
Key Card Communications, Inc. was incorporated in the State of Florida on
May 8, 2000 as a privately held corporation. Its initial capital stock of 1,000
shares, having a par value of $1.00 each, was increased to 20 Million shares
having a par value of $.001 as of June 27, 2000. On January 28, 2000 the
Articles of the corporation were again amended to authorize the issuance of 10
Million shares of preferred voting stock, having a par value of $.001. As of
the date of the closing of the reorganization with Fighton on August 31, 2001
all of the 16,716,414 issued and outstanding restricted common and preferred
shares of Key were deemed exchanged for an equal number of Fighton restricted
common shares. There were at the exchange date1,415,000 preferred Key shares
outstanding, the balance of 15,301,414 were common stock.
As noted previously, Key has recently completed a spin-out of the acquired
Fighton shares to its shareholders on a one-to-one shareholder basis without
further consideration. Key presently has approximately 44 shareholders of
record. Fighton has approximately 439 shareholders of record. Of these Fighton
shareholders, the non-Key Card shareholders hold approximately 1,063,846 shares.
Results of Operations
Key Card is engaged in the business of providing prepaid long distance
telephone services. Key Card completes these operations independently and
historically through its 100% wholly owned subsidiary 5 Star Communications,
Inc. which is also reported as part of the consolidated financial statements. 5
Star is no longer conducting operations. Accordingly, the enclosed consolidated
financial statements also contain accounting for 5 Star's participation within
Key Card. As both companies provided identical services and products, no
attempt was made to segregate their financial accounting.
Key Card's core product is a prepaid calling card which incorporates toll
free access numbers and pin, and personal identification numbers printed on an
array of branded phone cards. Purchasers of these prepaid phone cards are able
to place international and domestic long distance calls from any touch tone
phone in the continental United States at what are believed to be favorable
rates. The branded cards, in conjunction with Key Card business model and sale
program, have allowed Key Card to develop a market presence and repeat
customers.
Key Card focuses primarily in sale of cards to retailers and prepaid phone
card distributors. Theses resales are believed attracted to Key Card's phone
cards due to their branded packaging, profitability, and ease of use.
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At present, Key Card/5 Star has realized total gross revenues of
approximately $5,149,656 for the calendar year ending December 31, 2000 and
approximately $4,458,532 in revenues year-to-date through the September 30, 2001
accounting period. Key Card/5 Star has not obtained an operating profit for
this period and had a net loss for fiscal year 2000 of $1,345,373 and
anticipates a year-to-date net loss through September 30, 2001 of $6,382,215.
Key Card has an accumulated deficit of $7,727,838. Key Card does not
anticipate as of the filing of this Proxy that it will obtain its first
quarterly profits for the fourth quarter of the calendar year 2001 ending
December 31, 2001. Key Card is not able to break down the relative profit or
revenues as segregated between its own operations and that of its totally owned
subsidiary, 5 Star, and essentially treated the flow of revenues and any profit
or loss as an integrated financial effort. 5 Star has been inactive since
September 2001.
As noted previously, Fighton has not and will not contribute any assets,
revenues or profits to the reorganized company. The consolidated accounting
essentially reflects financial data for the Key Card subsidiary, adjusted on a
per share basis to reflect the Fighton shareholders.
Key Card has in the past 12 months experienced several problems with
various networks it has contracted to use. These problems have on occasion
resulted in the network being terminated and some of the phone cards Key Card
has out in the market place being turned off and rendered useless. Key Cards
has filed lawsuits against some of those network carriers, noted in the Legal
Proceedings, because of the lost profits and customers it has incurred due to
the interruption of its business. Key Card/5 Star believes that it has suffered
significant lost revenue and profits over the course of the year. Although the
Company has taken steps to insure that its current network relationships are
stable it cannot warrant that it will not have interruptions of service in the
future.
Key Card has in the past suffered lost revenue due to employee conversion
of sale for personal benefit as noted in the Legal Proceedings. Although the
Company has taken additional steps to protect its trade secrets and customer
list as well as other confidential information that company can not represent
that these types of problems will not occur in the future. Key Card has all
employees' sign a non-compete and confidentiality agreement, which the Company
hopes will alter this type of activity from occurring in the future.
Key anticipates that the majority of its revenue growth during the calendar
year 2002 should occur in the second and third quarters primarily through
anticipated expanded sales both in the USA and International and the point of
activation program. The majority of growth is anticipated in these sectors.
As of October 10, 2001, Key Card has entered a customer service contract
with Morgan Beaumont, Inc., a related party privately held entity, which sells
memberships and benefit packages related to computer sales and financing. Under
the terms of the customer service and support agreement, Morgan will pay to Key
Card $4.00/per collected sales for each of the Key Card phone cards distributed
by Morgan under its benefit packages. Additionally, as of December 31, 2001
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Morgan Beaumont, Inc. has entered into a sub-lease agreement for cubicle and
common space at the Key Card office and will be paying Key Card $500 a month
rent.
Morgan has represented to Key, though Key cannot warrant such results, that
it has commitments for approximately 10,000 sales through November to December
2001, which would generate revenues of up to $40,000 based upon all sales being
collected. Morgan has made significantly less sales during the period ending
December 31, 2001 because Morgan temporarily ceased marketing and shipping
product during the month of December while repositioning its product offering
for the year 2002.
It is further disclosed that Mr. Steve May, the CEO of Fighton, owns
approximately 35% of Morgan, Mr. Cliff Wildes, the Company's Vice President,
owns approximately 45% of the issued and outstanding shares of Morgan and Mr.
Rejbeni, Fighton's President owns approximately 3% of the Morgan shares and Rod
Braido a Director owns approximately 2% of Morgan's. No independent Board
passed upon the terms of this contract, which cannot be considered as an arms
length transaction or independently valued. Each shareholder of Fighton/Key is
advised that this relationship constitutes a certain potential conflict of
interest.
Key anticipates that the domestic sector of its business will increase at a
faster rate than the revenues from its international card segment. The relative
breakdown year to date of current revenues through September 30, 2001 are
estimated to be 25% of revenues from domestic card sales and 75% form
international card sales.
Key has recently delegated its internal auditing and accounting functions
to Cavanaugh and Company, a Sarasota accounting firm on an annual contractual
basis. Mr. Michael Pender of that firm has agreed, as part of the contract, to
become the new interim CFO of the Company.
Liquidity
Key Card like many other domestic industries, has noted a significant
slowing in its revenue growth subsequent to the terrorist attach and national
disaster of September 11, 2001. It is not known exactly how such events will
impact on its future earnings, but it is certain that these events will have
decreased the potential revenues and profits which may be realized by the
Company in calendar year 2002. The independent auditors for the consolidated
Company have expressed a reservation as to whether the Company may continue as a
"going concern."
Because the Company is a start-up entity and has not had income to date,
there are other various factors which could adversely affect its liquidity and
its ability to continue as a going concern. Management of Key/5 Star has
elected to treat the disclosure of these items in outline fashioned as follows:
1. Key is currently involved in two cases or claims in which it is presently a
defendant and two cases as a plaintiff. These cases or claims are more
particularly described under the litigation section of this report. The
Company does not believe any of the present litigation efforts would
constitute a basis for the Company to discontinue its present business
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operations, even if an adverse ruling were entered, and believed that it
has a meritorious defense to each of these actions or claims in which it is
a defendant. However, it should be understood that defending or prosecuting
legal actions would involve the expenditure of significant capital of the
Company.
2. Key has entered into loans and advances from various related parties. Some
of these loans and advances are currently in default and the Company is
working on the extension of time in which to pay the obligations. The
Company does not have the current resources to pay off these related party
transactions at the present time.
3. The Company entered into an option agreement with Newpont Fiduciaries to
purchase One Million shares of its stock at $1.00/share. This initial
option has been fully exercised and the proceeds were used to acquire the
interest by Key Card in Fighton Corporation and to repay related
acquisition expenses. Of this amount none remains as working capital
reserves. As noted generally above, Newpont Fiduciaries was referred to Key
by Mackenzie Shea which has acted as an advisor to Key, is a principal
shareholder, as well as having one of its major shareholders as a director
to Key's Board of Directors. Key recently granted to Newport a new option
right for up to 1,000,000 shares as described at page 3 of this Proxy.
4. Key has certain employee arrangements with its principal employees
including Mr. Steve May, Mr. Micheal Rejbeni and Mr. Clifford Wildes.
Messrs. May, Rejbeni and Wildes have agreed to accrue approximately 88% of
their current salaries to be paid at a future date in the aggregate amount
of approximately $550,000. This deferral of salary should be deemed to
constitute a current debt decreasing the liquidity of the corporation. The
aggregate salaries of all principal offices is approximately $740,000 for
the period of time they have worked, which is the case of Mr. Rejbeni and
Mr. Wildes is less than a full year, including the deferred portions of
approximately $550,000 per year.
5. In approximately March of 2001, the Company determined that its prior CFO
and accounting officer had apparently engaged in unauthorized loan
transactions employing Key funds for his personal use in the sum of
approximately $50,000. Key believes it has reconciled this charge by
accepting back the 400,000 Key shares previously held by this
officer/director and accepting his resignation. However, it now appears
that there may exist additional unauthorized funds that have been uncovered
in the Company's audit process and the Company is in the process of
determining these amounts and recovering from this ex-officer/director as
appropriate.
6. Key has borrowed $50,000 form Soma Fund IX, LLC, a private fund co-managed
by Mackenzie Shea. The loan is in default and a revised repayment schedule
has not been finalized.
7. Mr. Steve May, Fighton/Key's CEO, has a significant stock position in an
unrelated private company known as Bright Star Communications, Inc., which
has loaned Key Card $99,000 in 2001.
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8. Siesta Telecom, Inc., a private telephone company in which Mr. Steve May is
also a significant shareholder, has historically engaged in business and
financial transactions with Key and has loaned Key $69,825 as of September
30, 2001. The companies are in the process of negotiations to retire this
debt into cash and stock and/or stock in Key, at Key's discretion
9. Key has recently not paid $50,000 account obligation to Miketronics, Inc.,
a major network supplier. Key Card and Miketronics, Inc. are presently
engaged in discussions to satisfy this obligation by issuing 50,000
restricted common stock for a short term loan.
PROPOSAL I
CHANGE OF NAME FROM FIGHTON SUCCESSION CORPORATION TO KEY CARD, INC.
As part of the overall reorganization described above, management proposes
that the shareholders formally approve the amendment of the Articles of
Incorporation to change the name of the corporation from Fighton Succession
Corporation to Key Card, Inc. Management believes that this proposal is in the
best interest of the Company to reflect its new business activities and purposes
and that it would be inconsistent with the approval of the overall
reorganization not to change the name.
PROPOSAL II
ELECTION OF NEW BOARD
As part of the proposed reorganization, the plan calls for the election of
the following individuals presently serving as an interim Board of Directors.
Some of these individuals are also serving as principal officers for the
Company.
Mr. B. Steven May, Age 53;
--------------------
Mr. May will serve the Company full-time as its Chief Executive Officer and
as a Director. He has been affiliated with Key Card Communications, Inc. in
these capacities since April, 2000.
In 1997 Mr. May founded Siesta Telecom, Inc., a prepaid-paid privately held
phone card company. Mr. May remains affiliated as the majority shareholder.
From 1994 to 1997 Mr. May was Chief Operating Officer of S.T. Long Distance.Mr.
May was the Vice President and General Manager for C-Tec Corporation, a
telecommunications company, from 1992 to 1994. From 1986 to 1992, Mr. May held
the position of Chief Executive Officer of Seven Oaks Direct, Inc. Mr. May was a
Vice President of MCI from 1972 to 1984. Mr. May has over 30 years of
experience in the telecommunications industry.
11
Mr. Micheal Rejbeni, Age 39;
- ---------------------
Mr. Rejbeni will serve the Company full-time as its President and as a
Director. Mr. Rejbeni previously served as Vice President and General Manager of
Fusion Telecommunication International, Inc. (99-01) and Vice President of Sales
for USLEC (97-99). He also held senior sales management positions with TresCom
International Communications (96-97), Cable & Wireless (95-96)and Metromedia/ITT
(91-95). Mr. Rejbeni has both domestic and international experience in various
management positions within the telecommunications industry.
Mr. Rod Braido, Age 56;
- --------------
Mr. Braido will be affiliated with the Company as an outside Director. Mr.
Braido has over 25 years in the Computer Hardware and Semiconductor Industries.
Currently, Mr. Braido serves as Vice President of Strategic Programs at
Bell Microproducts (NASDAQ: BELM). Mr. Braido was a partner in Meridian
Capital, Inc. and served as Chief Executive Officer of Morgan Beaumont, Inc. in
2001 prior to returning to Bell Micro.
In 1998 Mr. Braido, as the founder, held the positions of President and
Chief Executive Officer of NetAttach, Inc. NetAttach developed the industries
first Gigabit data appliance and a Linux based proprietary operating system that
supported seamless sharing of data between Linux, UNIX, Windows and Mac
platforms. VA Linux System of Santa Clara, Ca, acquired NetAttach in April of
2000, (NASDAQ: LNUX). Mr. Baido remained in the position of Vice President of
Sales for VA Linux until January 2001.
Prior to founding NetAttach, Braido was involved with a number of high tech
companies in senior management roles. In 1996 Braido became Senior Vice
President of computer product sales and Senior Vice President and general
manager of Bellstor Memory Systems, a division of Bell Microproducts.
From 1989 to 1996 Mr. Braido was Vice President of World Wide Sales and
general manager of the Systems Division of SyQuest Technology. In 1987, he was
Vice President of Sales and Chief Operating Officer with Microtech International
Inc., (NASDAQ: SCMM).
Prior to 1987 Mr. Braido served with National Semiconductor (NASDO:NSM) for over
10 years in a number of sales management roles.
12
SUMMARY INFORMATION AS TO DIRECTORS
Executive Compensation 1 Number of Shares Percentage of
NAME Position (Beneficial &Legal)2 Issued and
Outstanding
Mr. B. Stephen May CEO/Director/ $ 377,000 10,000,000 50%
Treasurer
Mr. Micheal Rejbeni President/Director/ $ 250,000 800,000 4%
Secretary
Mr. Rod Braido Director Per Mtg. 10,000 Neg.
<FN>
1 The compensation chart does not reflect the deferral of approximately $71,000 in salary
by Mr. May in calendar year 2000 and approximately $359,000 in calendar year 2001; and Mr.
Michael Rejbeni the amount of approximately $108,996 in 2001. At present, no commitment or
program exists to make-up or repay these deferrals, though it is probable they may be paid
through future stock options.
2 Mr. Rod Braido is the only management member to be issued a stock option pursuant to an
executive stock option plan proposed to be ratified by this Proxy and described below.
Currently he has an option to acquire 1,000,000 common shares at $0.50/share through March,
OTHER EXECUTIVE OFFICERS
Executive Compensation Number of Shares Percentage of
NAME Position (Beneficial &Legal) Issued and
Outstanding
============== =========== ============== =================== =============
Michael Pender Interim CFO $ 35,000 -0- -0-
Part-time CFO
PROPOSAL III
RATIFICATION OF REORGANIZATION
While the Board of Directors earlier approved the reorganization terms and
have subsequently obtained majority shareholder consent, it is believed that all
shareholders of record must be given an opportunity to ultimately ratify this
merger as generally described above. Accordingly, management solicits the vote
of all shareholders in favor of approving the reorganization and the other terms
of the reorganization as set-out in this Proxy Statement. Also included within
the request for ratification of the reorganization is a ratification of all
reasonable and proper acts taken by the prior management on an interim basis in
approving and implementing the plan of reorganization and conducting the Company
pursuant to such reorganization on an interim basis. Again, it you do not
approve of the reorganization you will be afforded an opportunity in the
enclosed Proxy Ballot to vote for, against or abstain from approval. You should
be advised, however, that management believes that there is already a majority
share approval for such reorganization which will be voted at the time of the
meeting.
13
PROPOSAL IV
STANDBY AUTHORITY FOR MERGER
The Board of Directors request your vote and approval for stand-by
authority to complete, at the discretion of the Board of Directors but within
the next year, a potential merger of the Company between the parent Key Card
Communications, Inc. (formally Fighton Succession Corporation) and its wholly
owned and operating subsidiary Key Card Operating Company (formally Key Card
Communications, Inc. and its subsidiary 5 Star) with a third entity to be formed
to create a single Nevada corporation known as Key Card Communications, Inc.
The Board of Directors will reserve the right to make a final determination of
whether to complete this merger, or any portion of the merger, pursuant to
solicitation of your vote and approval and may elect for independent business
purposes not to complete such merger within the next year. However, if the
majority shareholders do approve such merger and are forward appropriate
dissenting shareholder rights, as provided for in the information package
attached, no further vote or solicitation of votes on this merger will be
required or requested and management will act in its discretion whether or not
to complete the merger based upon the shareholder votes. Again, you will have
the right to dissent from, agree with or abstain from voting on the stand-by
merger authority in the Proxy Ballot. Management believes that such authority
is in the best interest of the Company and solicits your vote in favor of this
proposal.
PROPOSAL V
ADOPTION OF STOCK OPTION PLAN
The Board has proposed your ratification of an executive stock and key
employee option plan to grant to key officers, as designated by the Board,
options to acquire the Company's common stock at exercise prices of $0.50 up to
$3.00 per share through the period ending December 31, 2005.
At present, you are requested to ratify the initial option as a hiring
incentive to Mr. Rod Braido of 10,000 shares exercisable at $0.50/share through
December, 2002.
The options to be issued in the future and the exercise prices will be
fixed by a disinterested majority of the Board of Directors, without further
shareholder approval, at prices ranging between $0.50/share to $3.00/share
exercise price. The option would be granted for recruiting purposes, to
compensate for deferred salaries, and to reward business performance as
subsequently determined by the Board of Directors.
As to outside Directors joining the Board in the future, the plan will
provide that outside Directors will receive options to acquire 10,000 shares
upon joining the Board to be exercised at a floating rate based upon an
anticipated 20% discount to future trading price.
14
The plan also has a special provision whereby key sales personnel who
generate revenue to the Company exceeding $350,000 on a monthly basis starting
in February, 2002 and ending March 31, 2002, will be entitled to receive one
share for each $10.00 of revenues generated up to 950,000 shares, or the maximum
available under the plan, whichever is less.
The total shares authorized to be subject to the plan will be 1,150,000
common shares.
A copy of the plan may be reviewed upon request to the Company.
PROPOSAL VI
CREATION OF A CLASS OF CONVERTIBLE PREFERRED SHARES
The Company recommends for your approval the creation of a new class of
convertible preferred shares. It is proposed that 10,000,000 of such shares be
authorized at $0.001 par. The shares would be convertible into three shares of
common stock upon terms prescribed by the Board of Directors upon issuance. The
shares would be non-voting, would have a liquidation and dividend priority over
common stock and would pay a dividend upon issuance as determined by the Board
of Directors. Your Board, in consultation with Newpont Fiduciaries as financial
consultants to the Company, believe that availability of such shares may be
significant to the Company's ability to raise subsequent capital. Issuance of
these shares could result in dilution to existing shareholders and cause a
reduction of earnings through the payment of dividends.
PROPOSAL VII
RATIFICATION OF APPOINTMENT OF INDEPENDENT ACCOUNTANTS
The Board of Directors intends to appoint J. H. Cohn, P.A. of New York as
independent certified public accountants for the Company to examine the
financial statements of the Company for the period beginning December 31, 2001
and continuing until discharged or replaced. The appointment of J. H. Cohn is
subject to ratification of the shareholders and a ballot soliciting your vote
for such ratification is part of these proxy materials. Weinberg & Company has
been acting as independent accountants for the predecessor Fighton Succession
since inception by virtue of its familiarity with the resulting Company's
affairs. The present Board of Directors recommends adoption of the resolution
ratifying the appointing J. H. Cohn the accounting firm as the independent
auditors replacing Weinberg & Company for the Company in an effort to save the
company accounting fees.
The present Board urges your vote in favor of the ratification of the
proposed auditors.
15
BOARD AND COMMITTEE MEETINGS
During the fiscal year ending December 31, 2000 (the "Last Fiscal Year"),
the Board of Directors held one meeting. The Board has held sixteen meetings in
calendar year 2001 to date. The Board of Directors does not have separate
sections or committees. All audits and compensation issues, as well as other
matters, are addressed as a committee of the whole.
SECTION 16(A) BENEFICIAL OWNERSHIP COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 (the "Exchange Act")
requires the Company's executive officers and persons who beneficially own more
than 10% of the Company's Common Stock to file initial reports of ownership and
reports of changes in ownership with the Securities and Exchange Commission
("SEC"). Such persons are required by SEC regulations to furnish the Company
with copies of all Section 16(a) forms filed by such persons.
Based solely on the Company's review of such forms furnished to the Company
and representations from certain reporting persons, the Company believes that
all filing requirements applicable to the Company's executive officers,
directors and more than 10% stockholders were complied with during the Last
Fiscal Year and will be completed as to new shareholders promptly upon
completion of the merger.
EXECUTIVE COMPENSATION
Certain additional required information concerning remuneration, other
compensation and ownership of securities by the Directors and Officers other
than set-out in the preceding Director/Manager tables are set-out in the
enclosed 10-QSB Report and incorporated by this reference. New management has
not been appointed and no provisions for other salaries are presently
determined.
PROPOSED DIRECTOR REMUNERATION
During the current fiscal year, the Company intends to compensate outside
directors at the rate of $350 for a half-day meeting and $500 for a full day
meeting. The Board has also proposed a stock option plan for outside directors
of 10,000 options immediately upon joining the Board at a price consistent with
any Option Agreement that might be in effect and 10,000 options a year for each
year served on the Board. No changes are currently contemplated in salaries or
directors compensation.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Certain significant relationships and related transactions are set-out in
the enclosed 10-QSB Report and incorporated by this reference.
MANAGEMENT'S STOCK RIGHTS AND OPTIONS
At present the Company has not adopted any plan for management (Directors
and Officers) options or stock rights and none are outstanding.
16
MANAGEMENT'S RECOMMENDATIONS
The present Board recommends your vote for all of the foregoing proposals,
but will provide in the Ballot Form space to vote for other nominees; or to vote
against or abstain from the other proposals.
OTHER MATTERS
The Special Meeting is called for the purposes set forth in the notice
thereof. The Board of Directors does not intend to present, and has not been
informed that any other person intends to present, any matters for action at the
Special Meeting other than those specifically referred to in the Notice of
Meeting and this Proxy Statement. If any other matters are properly brought
before the Special Meeting, it is the intention of the proxy holders to vote on
such matters in accordance with their judgment.
STOCKHOLDER PROPOSALS
There were no stockholders proposals submitted for consideration at this
Special Meeting. Stockholder proposals intended to be considered at the next
Annual Meeting of Stockholders must be received by the Company no later than
April 1, 2003. Such proposals may be included in the next proxy statement if
they comply with certain rules and regulations promulgated by the Securities and
Exchange Commission.
TRANSACTION OF OTHER BUSINESS
At the date of this Proxy Statement, the only business that the Board of
Directors intends to present or knows that others will present at the meeting is
as set forth above. If any other matter or matters are properly brought before
the meeting, or any adjournment thereof, it is the intention of the persons
named in the accompanying form of proxy to vote the proxy on such matters in
accordance with their best judgment.
Any stockholder may present a matter from the floor for consideration at a
meeting so long as the procedures established for such meeting and the Bylaws
are followed.
17
OTHER INFORMATION
FINANCIAL REPORTS & OTHER IMPORTANT DOCUMENTS
Unaudited financial statements for the companies (Key Card and Fighton) are
enclosed on a consolidated basis for the periods ending September 31, 2001 as
part of the 10-QSB material. Each shareholder should consider Management's
Discussion and Analysis contained with such 10-QSB report and incorporated by
this reference.
FURTHER INFORMATION
All references to each document referred to in this Information
Statement are qualified in their entirety by reference to the complete contents
of such document. Copies of these documents may be obtained by shareholders,
without cost, upon request from management at the mailing address of the Key
Card Communication, Inc. at: 5969 Cattleridge Blvd., Suite 200, Sarasota,
Florida 34232. The telephone number is (941) 552-2149.
Dated: February 25, 2002
BY ORDER OF THE BOARD OF DIRECTORS:
--------------------------------
B. Stephen May
18
STOCK
REDEMPTION FORM
1. FULL NAME OF HOLDER OF CERTIFICATE AS INDICATED ON THE STOCK CERTIFICATE:
2. COMPLETE MAILING ADDRESS OF WHERE REDEMPTION FUNDS ARE TO BE SENT:
3. CERTIFICATE NUMBER: ___________________________
4. DOES THE CERTIFICATE HAVE A RESTRICTIVE LEGEND? ____YES OR ____NO.
5. PLEASE REMEMBER TO ATTACH CERTIFICATE WITH PROPER ENDORSEMENT.
The undersigned represents upon oath, and upon penalty of perjury, that he,
she or it (hereinafter generically "he") is the legal and beneficial owner of
the above described stock certificate(s) of Fighton Succession Corporation. The
undersigned represents that he has read and understood the dissenting
shareholder rights package and Proxy materials supplied by the Company and has
based his decision upon review of that information and such other further
consultation which he obtained from his own legal or other professional
advisors. The undersigned further represents that he has made his own
determination of the realistic value of the Company and accepts or rejects the
Company's proposal as to the reasonable market value per share of the shares in
exercising these dissenting shareholder rights and has initialed the box below
indicating the alternative manner of the exercise of those rights.
SHAREHOLDER:
- ------------------------------
(Sign Here)
The above signed shareholder, should initial one on the following:
Initial here: ______
The above signing shareholder agrees to accept $0.05 per share for his
existing Fighton shares and herewith tenders such certificate in negotiable form
to the Company along with this Stock Redemption Form.
Initial here: ______
Alternatively, the above named shareholder wishes to exercise dissenting
shareholder rights, but does not agree with the valuation of the Company and
intends to pursue alternative remedies for redemption of his shares.
Key/Redemption
DISSENTING SHAREHOLDER RIGHTS
INFORMATION AND PACKET
Under California law you may be determined to be a "dissenting shareholder"
of Fighton Succession Corporation ("Fighton"), if you do not agree to vote in
favor of the terms of the reorganization as outlined in the Proxy Statement and
you wish to be "cashed out" for the fair market value of your shares in lieu of
continuing to participate in the reorganized Key Card Corporation.
If you determine that you are a dissenting shareholder, Fighton is
affording to you, in accordance with the following outline terms, the right to
receive a cash payment for your Fighton shares held in lieu of continuing to
participate as a shareholder in the corporation. If you are within this class of
shareholders you need to complete the following steps to comply with your
dissenting shareholder rights and to receive your payment in lieu of continuing
as a shareholder. If you have elected to vote in favor of the reorganization
and return the Proxy Ballot, you will not be entitled to dissenting shareholder
---- ---
rights.
If you have any questions concerning these rights or the information
contained in this packet or forms please contact Mr. Ken Craig at Key Card
Communications, (941) 552-2140 at your earliest convenience to receive further
explanation or information. The Company, in accordance with California law, is
also enclosing with this dissenting shareholder rights package a copy of the
required portions of the California statute pertaining to dissenting shareholder
rights. Should you have any question regarding the application of these
statutory provisions you should contact your own legal advisor. Should there
exist any conflict between the statute and the following terms, the statutory
provisions shall control. Based upon the foregoing, then, Fighton has attempted
to outline for you the requirements and procedures for exercising dissenting
shareholder rights as follows:
1. IF YOU WISH TO EXERCISE DISSENTING SHAREHOLDER RIGHTS YOU SHOULD NOT VOTE
----------
IN FAVOR OF THE REORGANIZATION IN THE ENCLOSED PROXY BALLOT FORM. VOTING
IN FAVOR OF THE REORGANIZATION INVALIDATES YOUR RIGHT TO BE A DISSENTING
SHAREHOLDER.
2. YOUR SHOULD RETURN WITHIN THIRTY (30) DAYS THE ENCLOSED FORM TO THE
COMPANY INDICATING YOUR CERTIFICATE NUMBER, AND NUMBER OF SHARES, ALONG
WITH YOUR DULY ENDORSED SHAREHOLD CERTIFICATE. THE COMPANY WILL MAIL TO
YOU AT THE ADDRESS INDICATED ON THE FORM YOUR CASH PAYMENT FOR THE SHARES
WITHIN FIFTEEN (15) DAYS OF RECEIPT OF THE REDEMPTION FORM ACCOMPANIED BY
THE ORIGINAL STOCK CERTIFICATE DULY AND PROPERLY ENDORSED.
3. AS YOU MAY KNOW, THE SHARES OF FIGHTON DO NOT HAVE A CURRENT TRADING
MARKET WHICH WOULD BE THE MOST RELIABLE BASIS TO DETERMINE A FAIR MARKET
VALUE FOR THE SHARES. IN THE ABSENCE OF SUCH A TRADING MARKET, THE
COMPANY HAS DETERMINED FAIR MARKET VALUE BASED UPON THE PRESENT NET WORTH
OF THE SHARES FROM THE PRESENT OPERATIONS AND ASSETS OF KEY CARD
COMMUNICATIONS, INC. THE WHOLLY OWNED AND SOLE OPERATING ENTITY OF
FIGHTON SUCCESSION CORPORATION, AND THEN ADDED A PREMIUM OF $0.02 PER
SHARE. BASED UPON THIS VALUATION, DERIVED FROM THE ENCLOSED UNAUDITED
QUARTERLY ACCOUNTING, THE COMPANY HAS DETERMINED THAT THE REASONABLE
VALUE PER SHARE IS $0.05. THE AMOUNT YOU WOULD VOLUNTARILY RECEIVE FROM
FIGHTON FROM EXERCISING DISSENTING SHAREHOLDER RIGHTS WOULD BE YOUR
NUMBER OF SHARES TIMES THIS VALUATION PER SHARE. FIGHTON BELIEVES THIS TO
BE A REASONABLE AND FAIR VALUATION OF THE SHARES FOR DISSENTING
SHAREHOLDER RIGHTS PURPOSES.
4. YOU ARE ADVISED THAT IF YOU DO NOT AGREE WITH THIS VALUATION YOU HAVE
CERTAIN RIGHTS TO INFORM THE COMPANY OF YOUR ESTIMATE OF VALUE AND, IF
NOT AGREED UPON, TO PROCEED WITH AN INDEPENDENT LEGAL ACTION TO REQUIRE
THE COMPANY TO REDEEM YOUR SHARES AT A HIGHER PRICE. THESE RIGHTS ARE
OUTLINED IN THE ENCLOSED MATERIAL ON DISSENTING SHAREHOLDER RIGHTS FROM
THE CALIFORNIA CODE. IF YOU WISH TO PURSUE SUCH ALTERNATIVE ACTION, YOU
SHOULD ALSO MARK YOUR INTENT TO DO SO ON THE REDEMPTION FORMS SUPPLIED TO
YOU WITH THIS PACKET.
5. PLEASE REMEMBER THAT IF YOU DO NOT RETURN YOUR CERTIFICATES ALONG WITH
THE REDEMPTION INFORMATION WITHIN THIRTY (30) DAYS FROM THE MAILING DATE
OF THIS NOTICE, YOUR RIGHTS TO EXERCISE DISSENTING SHAREHOLDER RIGHTS
WILL EXPIRE. THE COMPANY DOES NOT INTEND TO EXTEND OR FURTHER OFFER ANY
RIGHTS OF REDEMPTION BEYOND THIRTY DAYS FROM THE DATE OF THIS NOTICE.
Again, if you have any questions concerning dissenting shareholder rights
you are invited to discuss the matter with your own legal advisors and you may
also forward any inquires to the Company at the number and contact person
indicated above.
FIGHTON SUCCESSION CORPORATION PROXY BALLOT
SPECIAL MEETING, FEBRUARY 25, 2002
Please complete, sign and provide any additional information on this Proxy
Ballot and return it to the Company by mail to 5969 Cattleridge Blvd., Suite
200, Sarasota, Florida 34232 in the enclosed self-addressed stamped envelope
provided prior to, February 20, 2002.
FOR AGAINST ABSTAIN PROPOSAL
- --- ------- ------- ---------------------
Election of all current management nominees to the
Board of Directors. If voting against election of
all, indicate below your individual vote.
YOU MAY VOTE FOR ALL CURRENT NOMINEES ABOVE; OR
YOU MAY VOTE INDIVIDUALLY AS TO EACH PROPOSED
DIRECTOR BELOW
___ ______ _______ Mr. B. Stephen May, Director and Chairman
___ ______ _______ Mr. Michael Rejbeni, Director
___ ______ _______ Mr. Ron Braido, Director
OTHER MATTERS
___ ______ _______ Change of Name of the Corporation
___ ______ _______ Approval of Reorganization
___ ______ _______ Election of New Board
___ ______ _______ Standby Authority for Follow-up Merger
___ ______ _______ Ratification of Executive Stock Option Plan
___ ______ _______ Creation of Convertible Preferred Shares
___ ______ _______ Appointment of J. H. Cohn & Company as Auditors
OTHER SHAREHOLDER PROPOSALS AND/OR NOMINATIONS
(Unless otherwise indicated, your proxy will be voted in favor of any nomination
or proposal indicated below.)
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Attach sheets as necessary)
____Check here if you plan
to attend meeting.
___________________________
SIGNATURE
Print Shareholder Name(s) exactly
as they appear on your Certificate: Complete If Known:
____________________________ Certificate #: ____________
____________________________ No. of Shares: _____________
Key/Ballot Date _______________________