SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a)
OF THE SECURITIES EXCHANGE ACT OF 1934
Filed by the Registrant [ ]
Filed by a Party other than the Registrant [X]
Check the appropriate box:
[X] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Under Section 240.14a-12
FREEDOM SURF, INC.
(Name of Registrant as Specified in Its Charter)
------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Lucinda Nilsen
Chairman, Committee for Corporate Governance
30872 S. Coast Highway, Suite 189
Laguna Beach, CA 92651
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[ ] 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:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
FREEDOM SURF, INC.
17011 Beach Blvd., Suite 710
Huntington Beach, CA 92648
PROXY STATEMENT
Relating to a
SPECIAL MEETING OF SHAREHOLDERS
To be held at the Laguna Cliffs Marriott Resort
25135 Park Lantern
Dana Point, California on
February 26, 2000 at the hour of 11:00 a.m. (California Time)
INTRODUCTION
This Proxy Statement is being furnished by the Committee for Corporate
Governance, Lucinda Nilsen, Chairman (the "Committee"), to the shareholders of
common stock of FREEDOM SURF, INC., a Nevada Corporation (the "Company"), in
connection with the solicitation by the Committee of proxies to be voted at a
Special Meeting of Shareholders of the Corporation at Laguna Cliffs Marriott
Resort, 25135 Park Lantern, Dana Point, California on February 26, 2000 at the
hour of 11:00 a.m. (California Time) and any adjournment or adjournments thereof
(the "Special Meeting"), for the purpose of replacing the Board of Directors
with a new Board of Directors. This Proxy Statement is first being mailed to
shareholders on January 31, 2001.
PURPOSE OF SPECIAL MEETING
Why a Special Meeting is Being Called
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This Special Meeting has been called pursuant to Article I, Section 2 of the
By-Laws of Freedom Surf, Inc. by the Committee for Corporate Governance, Lucinda
Nilsen, Chairman, pursuant to a letter sent to the Committee signed individual
shareholders representing a majority of the shareholders of the Common Shares of
the Company. This request for a meeting was brought about by information which
the shareholders had received that the business of the Company had been
abandoned by the present Board of Directors, that the shareholders were unable
to communicate with the Board or any of the officers of the corporation, that
the shareholders believed that as a result, it appeared that the Company was
without executive leadership and without any effective Board of Directors. As a
result, the individual shareholders formed the Committee for Corporate
Governance, selected Lucinda Nilsen as Chairman and directed the Committee to
call a Special Meeting of the shareholders of the Company to elect new Directors
until the next annual meeting of shareholders.
Also, in October, 2000, the present Board of Directors authorized a 4 for 1
stock split which in the opinion of the Committee unduly diluted the number of
outstanding shares in the Company. The Committee believes that this stock split
should be reversed.
Purpose of the Special Meeting
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At the Special Meeting, shareholders entitled to vote (see "Voting at Special
Meeting") will be asked to consider the removal of the present Board of
Directors of the Company and replacing them with a new Board of Directors from a
slate of Directors suggested by the Committee. Shareholders will also be asked
to consider a reverse split of shares whereby shareholders would receive 1 share
for every 4 shares owned.
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VOTING AT SPECIAL MEETING
General
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The close of business on December 31, 2000, is the record date for determination
of the shareholders entitled to notice of, and to vote at, this Special Meeting
(the "Record Date"). As of the Record Date, there were issued and outstanding
40,636,000 shares of Common Stock entitled to vote. A majority of the
outstanding shares of the corporation entitled to vote represented in person or
by proxy is necessary to constitute a quorum for the transactions of business at
the Special Meeting. The holders of record on the Record Date of the Shares
entitled to be voted at the Special Meeting are entitled to cast one vote per
share on each matter submitted to vote at the Special Meeting.
A shareholder may vote in person or by proxy executed in writing by the
shareholder or his/her duly authorized attorney-in-fact. Such proxy shall be
filed with the Lucinda Nilsen, Chairman of the Committee before the time of the
meeting instructing her to vote in the manner stated on the proxy card. Shares
standing in the name of another corporation may be voted by such officer's agent
or proxy as the Bylaws of such corporation may prescribe or, in the absence of
such provision, as the Board of Directors of such corporation may determine.
Shares held by an administrator, executor, guardian or conservator may be voted
by him/her, either in person or by proxy, without the transfer of such shares
into his/her name. Shares standing in the name of a trustee may be voted by
him/her, either in person or by proxy, but no trustee shall be entitled to vote
shares held by him/her without transfer of such shares into his/her name. Shares
standing in the name of a receiver may be voted by such receiver and the shares
held by or under the control of a receiver may be voted by such receiver without
the transfer thereof to his/her name, if authority to do so be contained in
appropriate order of the court by which such receiver was appointed. A
shareholder whose shares are pledged shall be entitled to vote such shares until
the shares have been transferred into the name of the pledgee and thereafter the
pledgee shall be entitled to vote those shares thus transferred. Shares held by
brokers or nominees for the accounts of others may be voted by the brokers
and/or nominees, under applicable law, and the brokers and/or nominees may vote
shares for which no instructions have been given in their discretion. Shares of
its own stock belonging to the corporation shall not be voted, directly or
indirectly and have not been counted in determining the total number of
outstanding shares.
Accordingly, the indication of an abstention on a proxy or the failure to vote
either by proxy or in person will be treated as neither a vote "for" nor
"against" any issue raised at the meeting. Abstention from voting will have the
practical effect of voting against these matters since it is one less vote for
approval.
A proxy is not revoked by the death or incompetency of the maker unless, before
the authority granted thereunder is exercised, written notice of such death or
incompetency is received by the Company from the executor or administrator of
the estate or from a fiduciary having control of the shares represented by such
proxy. The giving of a proxy does not preclude the right to vote in person,
should the person giving the proxy so desire; and the person giving the proxy
has the power to revoke the same at any time before it has been exercised.
Shareholders may revoke a proxy by written notice to the Secretary of the
Company or by giving notice of revocation at the Special Meeting of
Shareholders.
Shares represented by a properly executed proxy in the accompanying form will be
voted at the meeting and, where instructions have been given by the
stockholder's shares will be voted in accordance with such instructions. As in
the Proxy, if no instructions are given, the stockholder's shares will be voted
according to the recommendations of the Committee. The Proxy may be revoked at
any time before its exercise by sending written notice of revocation to the
Committee at the address set forth on the Proxy Card, or by signing and
delivering a proxy which is dated later, or, if the stockholder attends the
meeting in person, by giving notice of revocation to the meeting judge.
The Committee will attempt to obtain reimbursement of the cost of preparing,
assembling and mailing this Proxy Statement. The Committee will, upon request,
reimburse the transfer agent, brokerage houses and other persons representing
beneficial owners of shares for their expenses in forwarding proxy materials to
such beneficial owners. If it becomes necessary to make a second distribution of
proxy cards and reminder notices to brokers and nominees of shareholders and/or
to shareholders, there would be additional charges.
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The proposals discussed below other than the election of directors must be
passed by a majority vote of the number of shares entitled to vote as
represented by the shareholders present at the meeting including those appearing
by proxy. A majority means one vote more than 50% of the number of shares
voting. Directors shall be elected by a plurality vote. A plurality vote means
that there are more votes for one candidate than there are for an opposing
candidate or candidates where there are more than two candidates for one
director=s position on the Board of Directors. If, for example, there were three
candidates for one position, the person obtaining the most votes would win
regardless of whether that person received a majority of the votes being cast.
The Special Meeting
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Removal of the Board and Election of a New Board
- ------------------------------------------------
The Committee desires to remove the following named persons from the Board of
Directors of the Company:
David McKenzie
Holly Richardson
Rick Songer
Article II, Section 1 of the By-laws of the Company provide that there shall be
at least 1 but no more than 5 directors. Historically, there have been four
directors. There are presently 3 directors with 1 vacancy on the Board due to
the resignation of John Cruickshank from the Board effective December 1, 2000.
That vacancy was never replaced.
The Committee desires that the shareholders consider replacing the Board of
Directors with the following slate of directors until the next annual meeting of
the shareholders:
Charles Cortland Hooper
Arthur F. Wigand
James L. Flippen
Lawrence R. Young
Biographies of Replacement Directors
- ------------------------------------
What follows is a biography of the persons whose names appear on the slate of
suggested by the Committee:
Charles Cortland Hooper, Age 52
Mr. Hooper is presently President of Rent USA, Inc., a public company, and is
also a member of the Board of Directors of that company since August of 2000.
From 1986 until August of 2000, he was the Chief Executive Officer of Mojave
Natural Resources in Temecula, California, a company which produces decorative
rock and construction aggregate and industrial minerals. From 1978 until 1990,
he was also the owner of Old Town Financial in La Jolla, California that
developed of shopping centers, office buildings, condominiums, apartments,
health clubs, single family homes and ranch estates. He began his career in 1968
with Litton Industries. He was an officer in the U.S. Navy during the Viet Nam
war. Mr. Hooper is a graduate of the University of California at Los Angeles
with High Honors, has a Master of Science Degree from the U.S. Naval Post
Graduate School and has done doctorate work in finance and human behavior. He
has also taken a number of continuing education courses in finance, real estate
and insurance.
Arthur F. Wigand, Age 57
Mr. Wigand is presently Vice President of Rent USA, Inc., a position which he
has held since August, 2000. Prior to coming with Rent USA, Mr. Wigand had been
retired since 1998. From 1996 through 1998, he became President of Cubic
Communications, a company that had had as its sole customer the United States
government. Mr. Wigand assisted the transition from government as the sole
customer to commercial applications for the company's products From 1986 to
1989, Mr. Wigand was Vice President of Operations at Compudyne Air Traffic
Control in San Diego, California. In 1995, Mr. Wigand became Vice President of
Direction Finder Products for product development, customer service, scheduling
and profit and loss for the product group establishing a joint venture with
Hughes STX to develop and manufacture search and rescue direction finding
equipment.
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James L. Flippen, Age 54
Mr. Flippen is Chief Financial Officer of Rent USA since August, 2000. Prior to
coming with Rent USA and since 1997, Mr. Flippen, acted as a consultant
specializing in new business development, feasibility studies of acquisitions
for quarry development, asphalt plants and batch plants, working on such
specific developmental projects as the new San Francisco ball park, the San
Francisco BART Airport extension and U.S. Steel hazardous waste clean up. Prior
to 1997 and going back for the last several years to 1986, he operated Flippen
Engineering, Inc. specializing in sand and gravel mining and recovery and
handling the engineering aspects of a number of large development projects
including high end residential, commercial and a Robert Trent Jones golf course.
Lawrence R. Young, Age 61
Mr. Young is an attorney at law who graduated from the University of Southern
California and the University of Southern California Law School, receiving his
law degree in 1965. He was admitted to the practice of law in the State of
California in the same year. He has maintained his law office in Downey,
California where he has been in private practice for the last 10 years.
Whether the Replacement Directors Own any Stock in the Company
- --------------------------------------------------------------
Other than Lawrence R. Young, none of the replacement directors have any stock
in the corporation. Lawrence R. Young has direct control over Defined Holding
Corporation, a California corporation, which owns a total of 400,000 shares of
Common Stock in the Company and is a member of the Committee for Corporate
Governance and signed the letter along with a majority of the shareholders of
the Company to request this Special Meeting.
Proposal to Authorize Reverse Split of Common Stock, If Necessary
- -----------------------------------------------------------------
The Committee believes that as a result of present market conditions and the
recent price of Freedom Surf stock in the present market, it may become
necessary to make a reverse split of outstanding common shares of the Company in
order to increase the stock price and make the Company more competitive and its
stock price more properly reflective of the Company's market strength. The
Committee does not believe that a reverse split is necessarily required at the
present time but believes that the new Board of Directors should have the
authorization from the shareholders to make a reverse split if it should become
required in order to benefit the Company. For that reason, the Committee wishes
to obtain authorization to make a reverse split of outstanding common shares
from a maximum of 1 share for each 4 shares presently issued and outstanding. If
the shareholders authorize this reverse split, then the new Board of Directors
could facilitate the reverse split of any number from 2 to 4 for every share
presently outstanding. The determination would be left to the discretion of the
new Board of Directors and would be made based upon their best judgment at the
time and upon present market conditions taking into consideration the Company's
future needs and requirements.
As you are no doubt aware, our common stock is traded over-the-counter under the
symbol FRSH. The following table sets forth, for the periods indicated, the high
and low bid prices for the common stock, as reported by the OTC Bulletin Board
during 2000. Common stock prices have been adjusted to reflect the 4 for 1 split
effective October 17, 2000.
Bid Price
High Low
-----------------------
2000
- ----
August $ 6.25 $3.00
September $ 9.00 $6.25
October $13.25 $9.00
November $12.50 $5.00
December $ 5.00 $ .30
2001
- ----
January $ .96 $ .40
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The original 4 for 1 stock split was made in October, 2000 and thereafter, the
Company failed to file timely reports with the Securities & Exchange Commission.
The Committee believes that the failure to make timely filings caused the stock
to plummet when the quarterly report was not timely filed on November 14, 2000.
The stock price has not returned since that time and it now appears that the
stock split was premature and should be reversed.
The extent of the reverse split would be based upon the circumstances at the
time of consideration. For this reason, the Committee believes that the
shareholders should authorize a reverse split and allow the new Board of
Directors to implement it in their sound discretion. The maximum reverse split
which would be authorized would be a 1 for 4 reverse split bringing the stock
back to the original share numbers prior to the October split.
Proxies
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Shares of Common Stock which are entitled to be voted at the Special Meeting and
which are represented by properly executed proxies will be voted in accordance
with the instructions indicated in such proxies. If no instructions are
indicated, such shares will be voted: (a) FOR the removal of the present
directors, David McKenzie, Holly Richardson and Rick Songer and the election of
the following slate of directors:
Charles Cortland Hooper
Arthur F. Wigand
James L. Flippen
Lawrence R. Young
THE COMMITTEE RECOMMENDS THAT THE STOCKHOLDERS VOTE TO REMOVE DAVID
MC KENZIE, HOLLY RICHARDSON AND RICK SONGER AND REPLACE THOSE DIRECTORS
WITH CHARLES CORTLAND HOOPER, ARTHUR F. WIGAND, JAMES L. FLIPPEN &
LAWRENCE R. YOUNG UNTIL THE NEXT ANNUAL MEETING OF SHAREHOLDERS.
and (b) FOR an authorization to the new Board of Directors to make a one time
reverse stock split of a maximum of 1 share for each 4 shares held, the reverse
split to be made at the sound discretion of the new Board.
THE COMMITTEE RECOMMENDS THAT THE STOCKHOLDERS VOTE TO AUTHORIZE THE
NEW BOARD OF DIRECTORS TO MAKE A ONE TIME REVERSE SPLIT OF A MAXIMUM OF
ONE SHARE FOR EACH FOUR SHARES OWNED.
COMMITTEE FOR CORPORATE GOVERNANCE
By: /s/ Laurinda Nilsen
----------------------------
Chairman
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FREEDOM SURF, INC.
NOTICE OF SPECIAL MEETING OF STOCKHOLDERS
Laguna Beach, California
JANUARY 21, 2001
TO THE STOCKHOLDERS OF FREEDOM SURF, INC.:
NOTICE IS HEREBY GIVEN by the Committee for Corporate Governance,
Lucinda Nilsen, Chairman, pursuant to Article I, Section 2 of the By-Laws of
Freedom Surf, Inc. and pursuant to a letter dated January 19, 2001 signed by
individual shareholders of the Common Stock of Freedom Surf, Inc. (the
"Company") representing at least 51% of the Common Shares outstanding in the
Company that a Special Meeting of the stockholders of FREEDOM SURF, INC. will be
held at the Laguna Cliffs Marriott Resort, 25135 Park Lantern, Dana Point,
California on February 26, 2000 at the hour of 11:00 a.m. (California Time) for
the following purpose:
(1) TO REMOVE FROM THE PRESENT BOARD OF DIRECTORS THE FOLLOWING
NAMED PERSONS:
DAVID McKENZIE
HOLLY RICHARDSON
RICK SONGER
(2) TO REPLACE THE BOARD OF DIRECTORS WITH THE FOLLOWING NAMED
PERSONS UNTIL THE NEXT ANNUAL MEETING OF SHAREHOLDERS:
CHARLES CORTLAND HOOPER
ARTHUR F. WIGAND
JAMES L. FLIPPEN
LAWRENCE R. YOUNG, ESQ.
(3) TO AUTHORIZED THE NEW BOARD OF DIRECTORS TO MAKE A ONE TIME
REVERSE SPLIT OF A MAXIMUM OF ONE SHARE FOR EACH FOUR SHARES
OWNED.
This Notice is being sent without the agreement and without the
cooperation of the present Board of Directors or Company Management. The Meeting
is being called and is the sole responsibility of the Committee for Corporate
Governance, Lucinda Nilsen, Chairman.
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Stockholders of record at the close of business on December 31, 2000,
will be entitled to notice of and to vote at the Special Meeting or any
adjournment thereof. The list of the Company's Shareholders entitled to notice
of and to vote at this Special Meeting will be made available from 9:30 a.m. to
11:30 a.m. weekdays at the office of the corporate stock transfer agent, First
American Stock Transfer, Inc., 1717 E. Bell Road, Suite 2, Pheonix, AZ 85022-
6200, from the date of this notice for inspection by any Shareholder for any
purpose germane to this Special Meeting.
Stockholders are cordially invited to attend the meeting in person.
Those who will not attend and who wish their stock voted are requested to sign,
date, and mail promptly the enclosed proxy for which a stamped return envelope
is provided.
It being the belief of the Committee that the present Board of
Directors having abandoned the Company and having refused to call this Special
Meeting, this meeting is called pursuant to a letter dated January 19, 2001
signed by individual shareholders of the Common Stock of the Company
representing at least 51% of the Common Shares outstanding in the Company which
was sent to the Committee for Corporate Governance which was formed for this
purpose until a new Board of Directors has been elected and can take the reigns
of power.
By: /s/ Laurinda Nilsen
- ----------------------------
Chairman
Committee for Corporate Governance
January 31, 2001/Date of mailing to stockholders
IMPORTANT:
ALL SHAREHOLDERS ARE CORDIALLY INVITED TO ATTEND THIS SPECIAL MEETING. WHETHER
OR NOT YOU PLAN TO ATTEND IN PERSON, YOU ARE URGED TO DATE AND SIGN THE PROXY
ENCLOSED AND RETURN IT PROMPTLY IN THE ENVELOPE PROVIDED, WHICH REQUIRES NO
POSTAGE IF MAILED IN THE UNITED STATES. THIS WILL ASSURE YOUR REPRESENTATION IN
THE QUORUM FOR THE TRANSACTION OF BUSINESS AT THIS SPECIAL MEETING. YOUR PROXY
WILL BE REVOCABLE, EITHER IN WRITING OR BY VOTING IN PERSON AT THE SPECIAL
MEETING, AT ANY TIME PRIOR TO ITS EXERCISE.
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PROXY
FREEDOM SURF, INC.
THIS PROXY IS SOLICITED ON BEHALF OF THE COMMITTEE FOR CORPORATE GOVERNANCE
The undersigned common shareholder of Freedom Surf, Inc. acknowledges receipt of
the Notice of Special Meeting of the Company to be held at the Laguna Cliffs
Marriott Resort, 25135 Park Lantern, Dana Point, California on February 26, 2000
at the hour of 11:00 a.m. (California Time) and any adjournment or adjournments
thereof (the "Special Meeting"), for the purpose of replacing the Board of
Directors with a new Board of Directors December 29, 2000 and appoints Lucinda
Nilsen, with power of substitution, for and in the name of the undersigned, to
vote as proxies for the undersigned according to the number of common shares the
undersigned would be entitled to vote if they were personally present at the
Special Meeting of shareholders of the Company, and to vote all common shares of
the Company held by the undersigned and entitled to be voted upon the following
matters:
(1) TO REMOVE THE FOLLOWING NAMED PERSONS FROM THE
PRESENT BOARD OF DIRECTORS:
DAVID McKENZIE
TO REMOVE [ ] NOT TO REMOVE [ ] ABSTAIN [ ]
HOLLY RICHARDSON
TO REMOVE [ ] NOT TO REMOVE [ ] ABSTAIN [ ]
RICK SONGER
TO REMOVE [ ] NOT TO REMOVE [ ] ABSTAIN [ ]
(2) TO ELECT THE FOLLOWING PERSONS TO THE BOARD OF DIRECTORS UNTIL
THE NEXT ANNUAL MEETING OF SHAREHOLDERS:
CHARLES CORTLAND HOOPER
FOR [ ] AGAINST [ ] ABSTAIN [ ]
ARTHUR F. WIGAND
FOR [ ] AGAINST [ ] ABSTAIN [ ]
JAMES L. FLIPPEN
FOR [ ] AGAINST [ ] ABSTAIN [ ]
LAWRENCE R. YOUNG
FOR [ ] AGAINST [ ] ABSTAIN [ ]
(3) TO AUTHORIZED THE NEW BOARD OF DIRECTORS TO MAKE A ONE TIME
REVERSE SPLIT OF A MAXIMUM OF ONE SHARE FOR EACH FOUR SHARES
OWNED.
FOR [ ] AGAINST [ ] ABSTAIN [ ]
THE SHARES COVERED BY THIS PROXY WILL BE VOTED IN ACCORDANCE WITH THE
SPECIFICATION MADE. IF NO SPECIFICATION IS MADE THEY WILL BE VOTED IN FAVOR OF
THE ABOVE ITEMS.
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Signed:__________________________________ Dated:________________
Print Name:______________________________
Please sign proxy exactly as your name appears on the share certificate. When
signing as attorney, executor, administrator, trustee, or guardian, give full
title as such. If signer is a corporation, sign full corporate name by duly
authorized officer. If shares are held in the name of two or more persons, all
should sign.
Number of Shares Owned as of December 31, 2000:_________________________
This proxy should be mailed so that it will be received no later than the close
of business on February 25, 2001. It should be mailed as follows:
Laurinda Nilsen
Chairman, Committee for Corporate Governance
30872 S. Coast Highway, Suite 189
Laguna Beach, CA 92651
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