SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES EXCHANGE ACT OF
1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[X] Preliminary Proxy Statement [ ] Confidential For Use of
the Commission Only (as
[ ] Definitive Proxy Statement Permitted by Rule 14a-6(e)(2)
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
SITESTAR CORPORATION
(Name of Registrant as Specified In Its Charter)
N/A
(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)
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: ___ (set forth amount on which the filing fee
is calculated and state how it was determined):
(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:
(3) Date Filed:
SITESTAR CORPORATION
15303 VENTURA BOULEVARD, SUITE 1510
SHERMAN OAKS, CALIFORNIA 91403
(818) 380-8180
-------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON AUGUST 29, 2001
To the Shareholders of Sitestar Corporation:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Shareholders of Sitestar
Corporation ("Sitestar" or the "Company") will be held at The Radisson Valley
Center Hotel, 15433 Ventura Boulevard, Encino, California 91436 on August
29, 2001 at 2:30 P.M. for the following purposes:
(1) to elect three Directors to serve until the 2002 Annual Meeting and
until their successors shall have been duly elected and qualified;
(2) to ratify an amendment to our articles of incorporation that
increased the authorized number of shares of stock from 85,000,000
shares to 310,000,000 shares;
(3) to ratify the retention of Stonefield, Josephson Inc. as independent
accountants for the Company for the fiscal year ending December 31,
2001; and
(4) to transact such other business as may properly come before the
meeting, or any adjournment or adjournments thereof.
The Board of Directors has fixed the close of business on July 10, 2001 as
the record date for determining the shareholders having the right to vote at the
meeting or any adjournments thereof.
Your proxy is important whether you own a few or many shares. Please
complete, sign, date and promptly return the enclosed proxy in the
self-addressed, postage-paid envelope provided. Return the proxy even if you
plan to attend the meeting. You may always revoke your proxy and vote in person.
Dated: July 31, 2001
By Order of the Board of Directors,
/s/ Frederick T. Manlunas
Frederick T. Manlunas
Secretary
SITESTAR CORPORATION
15303 VENTURA BOULEVARD, SUITE 1510
SHERMAN OAKS, CALIFORNIA 91403
(818) 380-8180
---------------
PROXY STATEMENT
---------------
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD AUGUST 29, 2001
The Board of Directors of Sitestar Corporation ("Sitestar" or the "Company") is
soliciting proxies in the form enclosed with this statement in connection with
the Annual Meeting of Shareholders to be held on August 29, 2001 or at any
adjournments thereof. Only shareholders of record at the close of business on
July 10, 2001 are entitled to notice of, and to vote at, the Annual Meeting.
Each shareholder is entitled to cast, in person or by proxy, one vote for each
share held of record at the close of business on July 10, 2001. As of July 10,
2001 there were outstanding 80,371,696 shares of common stock, par value $.001
per share (the "Common Stock"), the only outstanding voting security of the
Company. Of the total 80,371,696 shares outstanding, a majority, or 40,185,849
voting shares will constitute a quorum for the transaction of business at the
meeting. The affirmative vote of the holders of the majority of the shares of
the Common Stock present and represented at the meeting and entitled to vote is
required to elect directors, approve the amendment to the articles of
incorporation and ratify the selection of the company's independent accountants.
The proxies named in the accompanying Form of Proxy will vote the shares
represented thereby if the proxy appears to be valid on its face, and where
specification is indicated as provided in such proxy, the shares represented
will be voted in accordance with such specification. If no specification is
made, the shares represented by the proxies will be voted (1) to elect three
Board nominees for Directors for a term expiring at the 2002 Annual Meeting of
Shareholders; (2) to ratify an amendment to our articles of incorporation in
order to increase the authorized number of shares of stock from 85,000,000
shares to 310,000,000 shares; and (3) for the ratification of the retention of
Stonefield, Josephson Inc. as the Company's independent public accountants for
the fiscal year ending December 31, 2001.
If you give us a proxy, you can revoke it at any time before it is used. To
revoke it, you may file a written notice revoking it with the Secretary of the
Company, execute a proxy with a later date or attend the meeting and vote in
person.
This Proxy Statement and the accompanying Form of Proxy are first being sent to
shareholders on or about July 31, 2001. In addition to mailing this material to
shareholders, the Company has asked banks and brokers to forward copies to
persons for whom they hold stock of the Company and to request authority for the
execution of proxies. The Company will reimburse banks and brokers for their
reasonable out-of-pocket expenses in doing so. Officers of the Company may,
without being additionally compensated, solicit proxies by mail, telephone,
telegram or personal contact. All proxy soliciting expenses will be paid by the
Company. The Company does not expect to employ anyone else to assist in the
solicitation of proxies.
1
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT
The following table sets forth, as of June 30, 2001, certain information with
respect to the beneficial ownership of Common Stock owned by (i) those persons
or groups known by the Company to own more than five percent of the outstanding
shares of Common Stock, (ii) each Director and Executive Officer, and (iii) all
Directors and Executive Officers as a group.
Shares of Common
Name and Address of Stock Beneficially Percent of
Beneficial Owner Owned (1) Class (2)
- ------------------- ------------------ ------------
Frank and Julie Erhartic
7109 Timberlake Road
Lynchburg, Virginia 24502 ........... 12,437,985 15.48%
Frederick T. Manlunas
15303 Ventura Blvd., Suite 1510
Sherman Oaks, California 91403....... 12,079,804 15.03%
Clinton J. Sallee
15303 Ventura Blvd., Suite 1510
Sherman Oaks, California 91403....... 10,550,916 13.13%
Kevorak Zoryan
15303 Ventura Blvd., Suite 1510
Sherman Oaks, California 91403....... - *
All directors and executive
officers as a group
(3 persons) .......................... 22,630,720 28.16%
- ---------------
* Less than 1%.
(1) Except as otherwise indicated, we believe that the beneficial owners of our
common stock listed above, based on information furnished by such owners,
have sole investment and voting power with respect to such shares, subject
to community property laws where applicable.
(2) Based on 80,371,696 shares of common stock issued and outstanding as of
June 30, 2001.
2
PROPOSAL 1
Election of Directors
The Company's By-Laws provide that the Board of Directors shall consist of not
more than nine members. The following three persons currently are serving as
Directors of the Company: Frederick T. Manlunas, Clinton J. Sallee and Kevork
Zoryan. The terms of the current directors expire at the Annual Meeting.
Directors are elected at each annual meeting of the Shareholders to hold office
until the next annual meeting and until a successor has been elected and
qualified.
The persons named below have been nominated by management for election as
directors of the Company to serve until the 2002 Annual Meeting of Shareholders
or until their respective successors are duly elected and qualified.
Unless otherwise instructed, the enclosed proxy will be voted for election of
the nominees listed below, except that the persons designated as proxies reserve
full discretion to cast their votes for another person recommended by management
in the unanticipated event that any nominee is unable to or declines to serve.
The Board has no reason to believe that any nominee will be unable or unwilling
to serve.
The three nominees proposed for election as Directors are:
Position with
Name the Company Age
- ------- ------------------- -----
Frederick T. Manlunas Chairman of the Board 33
Clinton J. Sallee President and CEO, 29
Director
Kevork Zoryan Director 28
Business Experience:
- -------------------------
The principal occupation and business experience during the last five years for
each of the nominated directors are as follows:
FREDERICK T. MANLUNAS, has been a Director of the Company since October of 1998
and has served as the Company's Chairman of the Board since July 1999.
Mr.Manlunas has managed Gateway Holdings, Inc., a private equity fund based in
Los Angeles since 1995. Prior to founding Gateway, Mr. Manlunas was an Associate
with Arthur Andersen LLP's Retail Management Consulting division from 1991 to
1995. Mr. Manlunas also serves as Director for Global Sourcing Group, a Delaware
corporation, MenuDirect, Inc., a Delaware corporation, and Xcel Medical
Pharmacy, a California corporation. Mr. Manlunas received a Bachelor of Science
degree in Journalism from Florida International University and he earned a
Masters of Business Administration degree from Pepperdine University.
CLINTON J. SALLEE has been a Director of the Company since May of 1999 and has
served as the Company's President and Chief Executive Officer since July 1999.
In 1996, Mr. Sallee founded Sallee Zoryan, a concept development firm, where he
served as President since inception. Prior to founding Sallee Zoryan, Mr. Sallee
was an Associate with W.E. Myers & Company, a boutique investment bank,
specializing in industry consolidations. Mr. Sallee earned a Bachelor of Science
degree in Business Administration from the Marshall School of Business at the
University of Southern California in 1994.
3
KEVORK A. ZORYAN has been a Director of the Company since July of 1999. From
March 1997 to July 1999, Mr. Zoryan served on the acquisition team of the Morgan
Stanley Real Estate Fund, a leading international private equity real estate
investment fund. From March 1995 to May 1996, Mr. Zoryan served as an analyst of
the JE Robert Companies, and from June 1993 to February 1995, as a staff analyst
with Ernst & Young. Mr. Zoryan co-founded Sallee Zoryan, a concept development
firm in 1996, and currently serves as its Partner. Mr. Zoryan earned a BS in
Business Administration from the Marshall School of Business at the University
of Southern California in 1994. He currently attends the Harvard Business School
as a member of the MBA Class of 2001.
Family Relationships and Involvement in Certain Legal Proceedings
- -----------------------------------------------------------------
There are no family relationships among directors, executive officers, or
persons nominated or chosen by the Company to become directors or officers, nor
was anyone involved in any legal proceeding requiring disclosure.
Board Meetings and Committees
- -----------------------------
The Board of Directors held four meetings during the 2000 fiscal year. No
Director attended (whether in person, telephonically, or by written consent)
less than 75% of all meetings held during the period of time he served as
Director during the 2000 fiscal year.
Our Board of Directors has not established any committees.
Board of Directors Interlocks and Insider Participation
in Compensation Decisions
- -------------------------------------------------------
There were no reportable business relationships between the Company (or any
other corporation that requires specific disclosure under this heading) and the
members of the Board of Directors in 2000.
Compliance with Section 16(a) of the Securities Exchange Act of 1934
- --------------------------------------------------------------------
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
officers and directors, and each beneficial owner of more than ten percent of
the Common Stock of the Company, to file reports of ownership and changes in
ownership with the Securities and Exchange Commission. Officers, directors and
greater than ten-percent shareholders are required by SEC regulations to furnish
the Company with copies of all Section 16(a) forms they file.
Based solely on its review of the copies of such forms received by it, or
written representations from certain reporting persons that no Form 5's were
required for those persons, the Company believes that during fiscal 2000 all
filing requirements applicable to its officers, directors, and greater than
ten-percent beneficial owners were complied with.
4
EXECUTIVE COMPENSATION
Executive Officers Compensation
The following table summarizes the compensation paid to our chief executive
officer and each executive officer with a salary in excess of $100,000 for each
of the last three fiscal years.
SUMMARY COMPENSATION TABLE
Annual Compensation Long Term Compensation
-------------------------------------------------- --------------------------------------------------
Other Restricted
Annual Stock Options LTIP All Other
Position Year Salary ($) Bonuses($) Compensation($) Awards($) SARs(#) Payouts ($) Compensation
- -------- ---- ---------- ---------- -------------- ----------- ------- ----------- ------------
Frederick T. 1998 $ 96,000 -- -- -- -- -- --
Manlunas 1999 91,500 -- -- -- -- -- --
Chairman of the 2000(1) -- -- 268,068 -- -- -- --
Board 2001 250,000 -- -- -- -- -- --
Clinton J. 1999 -- -- 2,000,000 -- -- --
Sallee 2000(2) 19,000 -- 332,268 -- -- -- --
President & Chief 2001 250,000 -- -- -- -- -- --
Executive Officer
- --------------------
(1) Mr. Frederick Manlunas was awarded shares in our common stock in lieu of
cash compensation.
(2) Mr. Clinton J. Sallee was awarded shares in our common stock in lieu of
cash compensation.
The Company currently has no long-term compensation, annuity, pension or
retirement plans.
DIRECTOR COMPENSATION
Our directors do not receive any compensation other than their salaries as
officers of the Company.
OPTIONS/SAR GRANTS IN LAST FISCAL YEAR
No stock option grants or Stock Appreciation Rights ("SARs") were made during
the fiscal year ended December 31, 2000 to any named executive officers of the
Company
5
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Effective as of September 30, 1999 we sold the non-Internet assets of Holland
American International Specialties to IFCO Group, LLC, whose members consist of
certain shareholders of the Company, including Frederick T. Manlunas, our
Chairman of the Board. We retained the assets consisting of the Internet web
site Holland-American.com. Holland American International Specialties will
continue to serve as Holland-American.com's exclusive fulfillment center. The
purchase consideration for the non-Internet assets of Holland American
International Specialties was $900,000 and was based upon a business appraisal
by an independent third party appraiser. The consideration included $200,000
which was to be offset against the Company's liability to Mr. Manlunas for
services rendered in connection to the acquisition of Sitestar, Inc., the
assumption of $654,000 of liabilities and a promissory note in the amount of
$46,000. The note bears interest at a rate of 8% per annum, and is payable in
annual installments of $15,333, and is due and payable on September 30, 2002.
The note is secured by HAIS' accounts receivable and inventory.
On September 30, 1999, we sold our minority equity interest in Sierra Madre
Foods to IFCO Group, LLC for $200,000. The consideration was paid in the form of
assumption of $160,000 of debt related to the investment and the balance of
$40,000 was paid by a promissory note payable in three annual installments of
$13,334 each. The note bears interest at a rate of 8% per annum. The purchase
consideration was equal to our original investment in January 1999.
On July 1999, a majority of our shareholders, including our Chairman, Mr.
Manlunas, acquired all the issued and outstanding shares of Sitestar, Inc., a
Delaware corporation, in exchange for 3,491,428 shares of our Common Stock owned
by thos shareholders. Simultaneous with the closing of this transaction, those
shareholders contributed the issued and outstanding shares of Sitestar, Inc. to
us as contributed capital. Sitestar, Inc. is a Web development, design and
hosting company formed in 1996 and is based in Annapolis, Maryland.
In August 1999, we acquired substantially all of the assets of Greattools.com in
exchange for 49,000 shares of our Common Stock. We acquired the assets of
Greattools.com from Global Sourcing Group, Greattools.com's current fulfillment
center. Gateway Holdings, Inc., a private investment company managed by our
Chairman Frederick Manlunas, has a 14.6% equity ownership in Global Sourcing
Group.
In January 1999, Mr. Manlunas, a major stockholder of the Company, loaned
$80,300 to the Company for use as working capital based on an oral agreement.
The amounts owed to Mr. Manlunas are not accruing interest, and are due and
payable upon demand. To date, the Company has made no payments to Mr. Manlunas
in satisfaction of this obligation.
In October 2000, we issued 100,000 shares of our common stock to Clinton J.
Sallee, our president and chief executive officer, valued at $21,000 in lieu of
back and accrued compensation. The issuance of these shares was exempt from the
registration and prospectus delivery requirements of the Securities Act of 1933,
as amended, pursuant to Section 4(2) thereof.
6
In December 2000, we issued 5,584,746 shares of our common stock to Frederick
Manlunas, our Executive Chairman, valued at $268,068 in lieu of back and accrued
compensation. The issuance of these shares was exempt from the registration and
prospectus delivery requirements of the Securities Act of 1933, as amended,
pursuant to Section 4(2) thereof.
In December 2000, we issued 6,484,746 shares of our common stock to Clinton J.
Sallee, our president and chief executive officer, valued at $311,268 in lieu of
back and accrued compensation. The issuance of these shares was exempt from the
registration and prospectus delivery requirements of the Securities Act of 1933,
as amended, pursuant to Section 4(2) thereof.
PROPOSAL 2
To ratify an amendment to our articles of incorporation
that increased the authorized number of shares of
stock from 85,000,000 shares to 310,000,000 shares
The Board of Directors approved and deemed advisable an amendment to Article V
of the Company's Articles of Incorporation that increased the number of
authorized shares of common stock from 75,000,000 to 300,000,000 and increased
the total number of shares of stock authorized from 85,000,000 to 310,000,000.
By vote of the majority stockholders on January 4, 2001, consent was given to
increase the authorized common stock. The action was necessary in order for the
Company to meet its obligation to provide sufficient shares for the conversion
of debentures and other purposes described below. The debentures had been issued
in connection with financings to fund the acquisition activities of the Company.
In addition, the increase was necessary to have stock available for acquisitions
and to compensate key personnel of the Company in lieu of cash.
Between January 4, 2001 and June 30, 2001 a total of 4,581,984 shares of common
stock were issued upon conversion of debentures and 6,021,818 shares were issued
relating to an acquisition. In June 2001, 2,140,000 shares were issued to
Clinton Sallee with a value of $107,000 and 2,500,000 shares were issued to
Frederick Manlunas with a value of $125,000, in lieu of back and accrued
compensation. Other key employees received an aggregate 4,693,674 shares at a
value of $.05 per share, in lieu of back and accrued compensation. As a result
of these issuances, as of June 30, 2001 there were 80,371,696 shares of common
stock outstanding.
The increase in the authorized common stock will not affect any substantive
rights, powers or privileges of holders of Common Stock, except to the extent
such holders are diluted, pro rata, by the issuance of additional shares of
Common Stock. Current holders of the Company's Common Stock presently own 100%
of the outstanding Common Stock; as a result of the amendment to Article V to
the Company's Articles of Incorporation and if all shares available thereunder
are issued, then the percentage ownership of the current holders of the
Company's Common Stock would be reduced to approximately 26% of the outstanding
Common Stock.
Holders of Common Stock do not have any preemptive rights with respect to future
issuances of Common Stock.
7
In addition to providing sufficient shares for conversion of the debentures, the
Board believes that the increased number of authorized shares of Common Stock
was desirable to enable the Company to issue Common Stock and to make additional
shares of Common Stock available for issuance or reservation without further
stockholder action.
THE BOARD STRONGLY BELIEVES THAT NOT HAVING THE SHARES AVAILABLE FOR ISSUANCE
WOULD BE EXTREMELY DETRIMENTAL TO THE COMPANY'S GROWTH. The Board believes that
having additional shares authorized and available for issuance or reservation
would allow the Company to have greater flexibility in considering potential
future actions involving the issuance of stock which may be necessary or
desirable to accommodate the Company's growth plan, including capital raising
transactions and acquisitions. Such purposes might include, without limitation,
the issuance and sale of Common Stock as part or all of the consideration paid
for purchases of businesses or other assets and/or for finders and other
consulting fees relating to such purchases (in that regard the Company is
actively considering the possibility of various such purchases), (ii) in public
or private offerings as a means of obtaining additional capital, (iii) to
satisfy any current or future obligations of the Company, whether or not
relating to financings, (iv) in connection with the conversion of convertible
securities of the Company, (v) as part or all of the consideration to repay or
retire any debt of the Company or to serve as collateral for such debt, (vi) in
connection with stock dividends, or (vii) with respect to existing or new
employee benefit or stock ownership plans or employment agreements. Except as
described above, the Company has no current commitment to issue any additional
shares of Common Stock or any shares of Preferred Stock. The Company does not
presently contemplate seeking stockholder approval for any future issuances of
capital stock unless required to do so by an obligation imposed by applicable
law or a regulatory authority.
In addition, the flexibility vested in the Company's Board of Directors to
authorize the issuance and sale of authorized but unissued shares of Common
Stock could enhance the Board of Directors' bargaining capability on behalf of
the Company's stockholders in a takeover offer or proxy contest, the assumption
of control by a holder of a large block of the Company's securities or the
removal of incumbent management, even if such a transaction were favored by the
holders of the requisite number of the then outstanding shares. Accordingly,
stockholders of the Company might be deprived of an opportunity to consider a
takeover proposal which a third party might consider if the Company did not have
authorized but unissued shares of Common Stock. The Company is not aware of any
present efforts to gain control of the Company or to organize a proxy contest.
If such a proposal were presented, management would make a recommendation based
upon the best interests of the Company's stockholders.
Accordingly, the Board of Directors and a majority of stockholders have approved
and filed with the Nevada Secretary of State the following amended first
paragraph of Article V to read as set forth below:
"This corporation is authorized to issue two classes of stock to be
designated, respectively, 'Common Stock' and 'Preferred Stock.' The total
number of shares which the corporation is authorized to issue is
310,000,000, of which 300,000,000 shares shall be Common Stock, par value
$.001 per share, and 10,000,000 shares shall be Preferred Stock, par value
of $.001 per share."
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A "FOR" VOTE TO RATIFY THE
AMENDMENT TO THE COMPANY'S ARTICLES OF INCORPORATION TO INCREASE THE
AUTHORIZED COMMON STOCK.
8
PROPOSAL 3
Ratification of Appointment of Independent Accountants
The Board of Directors has selected the firm of Stonefield, Josephson Inc.,
certified public accountants, to continue as the Company's independent
accountants for the fiscal year ending December 30, 2001 and recommends to the
shareholders that they vote for the ratification of this selection. Ratification
requires the affirmative vote of a majority of the shares represented and voted
at the Annual Meeting.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE RATIFICATION OF THE APPOINTMENT
OF STONEFIELD, JOSEPHSON INC. AS THE INDEPENDENT ACCOUNTANTS FOR THE COMPANY.
OTHER BUSINESS
As of the date of this statement, management knows of no business to be
presented at the meeting that is not referred to in the accompanying notice,
other that the approval of the minutes of the last shareholders' meeting, which
action will not amount to ratification of the actions taken at that meeting. As
to other business that may properly come before the meeting, it is intended that
the proxies properly executed and returned will be voted in respect thereof at
the discretion of the person voting the proxies in accordance with the best
judgment of that person.
SHAREHOLDER PROPOSALS
It is presently anticipated that the 2002 Annual Meeting of Shareholders will be
held on or around August 29, 2002. Any shareholder proposals intended to be
considered for inclusion in the proxy statement for presentation at the 2002
Annual Meeting must be received by the Company no later than April 15, 2002. The
proposal must be in accordance with the provisions of Rule 14a-8 promulgated by
the Securities and Exchange Commission under the Securities Act of 1934. It is
suggested that the proposal be submitted by certified mail - return receipt
requested,
9
INCORPORATION BY REFERENCE
The Company incorporates by reference in this Proxy Statement the following: (1)
from its Annual Report on Form 10-KSB for the year ended December 31, 2000: Part
II, Item 6 (Management's Discussion and Analysis of Financial Condition and
Results of Operations) and Item 7 (Financial Statements); and (2) from its
Quarterly Report on Form 10-QSB for the quarter ended March 31, 2001: Part I,
Item 1 (Financial Statements) and Item 2 (Management's Discussion and Analysis
of Financial Condition and Results of Operations).
FORM 10-KSB and ANNUAL REPORT
The Annual Report to Shareholders for the 2000 fiscal year, consisting of
portions of the Company's Form 10-KSB, accompanies this proxy statement as
Appendix A, but is not deemed a part of the proxy solicitation material. A
complete copy of the Company's Form 10-KSB for the fiscal year ended December
31, 2000, as required to be filed with the Securities and Exchange Commission,
excluding exhibits, will be mailed to shareholders without charge upon written
request to: Clinton J. Sallee, President, Sitestar Corporation, 15303 Ventura
Boulevard, Suite 1510, Sherman Oaks, CA 91403. Such request must set forth a
good-faith representation that the requesting party was either a holder of
record or beneficial owner of the common stock of the Company on July 10, 2001.
The Company's Form 10-KSB and other public filings are also available through
the Securities and Exchange Commission's world wide web site
(http://www.sec.gov.).
By Order of the Board of Directors
SITESTAR CORPORATION
Frederick T. Manlunas
Secretary
Dated: Sherman Oaks, California
July 31, 2001
10
FORM OF PROXY
This Proxy is Solicited on Behalf of the Board of Directors
of SITESTAR CORPORATION
The undersigned hereby appoints Frederick T. Manlunas and Clinton J.
Sallee as proxies, each with the power to appoint his or her substitute, and
hereby authorizes them to represent and to vote, as designated on this Form of
Proxy, all of the shares of Common Stock of Sitestar Corporation held of record
by the undersigned on July 10, 2001 at the Annual Meeting of Shareholders to be
held on August 29, 2001 or at any adjournment thereof with all powers that the
undersigned would possess if personally present, hereby revoking all previous
proxies.
1. Election of Directors
WITHHOLD AUTHORITY
FOR NOMINEE TO VOTE FOR NOMINEE
LISTED AT RIGHT LISTED AT RIGHT Nominees
[ ] [ ] Frederick T. Manlunas
[ ] [ ] Clinton J. Sallee
[ ] [ ] Kevork Zoryan
FOR AGAINST ABSTAIN
2. PROPOSAL TO RATIFY AN AMDENDMENT
TO THE ARTICLES OF INCORPORATION TO
INCREASE THE AUTHORIZED NUMBER OF SHARES OF
STOCK FROM 85,000,000 TO 310,000,000
[ ] [ ] [ ]
3. PROPOSAL TO APPROVE THE RETENTION OF STONEFIELD, JOSEPHSON INC.
AS THE INDEPENDENT PUBLIC ACCOUNTANTS OF
SITESTAR CORPORATION. [ ] [ ] [ ]
This proxy, when properly executed, will be voted in the manner directed herein
by the undersigned shareholder. If no direction is made, this Proxy will be
voted FOR Proposals 1, 2 and 3.
The undersigned hereby acknowledge(s) receipt of the Notice of the
aforesaid Annual Meeting and the Proxy Statement accompanying the same, both
dated July 31, 2001.
IMPORTANT: Please sign your name or names exactly as they appear on this Proxy.
When signing as attorney, executor or administrator, trustee or guardian, please
give your full title as such. If shares are held jointly, EACH holder should
sign.
---------------------------
Signature
---------------------------
Signature
DATE ________________, 2001
WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING, YOU ARE URGED TO SIGN AND RETURN
THIS PROXY, WHICH MAY BE REVOKED AT ANY TIME PRIOR TO ITS USE.