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 permitted by Rule
14a-6(e)(2))
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material underss.240.14a-12
eXmailit.com
-------------
(Name of Registrant as Specified in Its Charter)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] $125 per Exchange Act Rules O-11(c)(1)(ii), 14a-6(i)(1),14a-6(i)(2) or Item
22(a)(2) of Schedule 14A.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) 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 the 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:
4. Date Filed:
EXMAILIT.COM
1999 South Bascom Avenue, Suite 700
Campbell, California 95008
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To be held on September 29, 2003
To Our Shareholders:
You are cordially invited to attend the Annual Meeting of the Shareholders of
eXmailit.com (hereinafter referred to as the "Company"), to be held on Monday,
September 29, 2003 at 1:00 p.m. (PST) at _______________________________,
Vancouver, British Columbia, Canada, for the following purposes:
PROPOSALS FOR ANNUAL MEETING OF SHAREHOLDERS
EXMAILIT.COM
PROPOSAL NO. 1: To elect the Board of Directors, each to serve until the next
Annual Meeting of the Shareholders or until their respective
successors are elected and qualify;
PROPOSAL NO. 2: To ratify and approve the selection by the Board of Directors
of KPMG, LLP as the Company's independent accountants for the
fiscal year ending December 31, 2003;
PROPOSAL NO. 3: To approve an amendment to the Company's articles of
incorporation to change the Company's name to Cirond
Corporation;
PROPOSAL NO. 4: To approve an amendment to the Company's articles of
incorporation to create a class of 25,000,000 shares of
preferred stock;
PROPOSAL NO. 5: To ratify a 16-for-1 forward stock split of the Company's
issued and outstanding common stock;
PROPOSAL NO. 6: To ratify a bylaw amendment changing the quorum requirement
for shareholder meetings; and
PROPOSAL NO. 7: To consider and vote upon such other business as may properly
come before the meeting or any adjournment thereof.
The complete text of these proposals and the reasons your directors have
proposed their adoption are contained in the Proxy Statement, and you are urged
to carefully study them. If you do not plan to attend the Annual Meeting, you
are respectfully requested to sign, date and return the accompanying Proxy
promptly.
FOR THE REASONS STATED HEREIN, YOUR BOARD OF DIRECTORS RECOMMENDS THAT YOU
VOTE "FOR" THESE PROPOSALS. YOUR VOTE IS IMPORTANT NO MATTER HOW MANY SHARES YOU
OWN. TO BE SURE THAT YOUR SHARES WILL BE VOTED AT THE MEETING, PLEASE SIGN AND
DATE THE ENCLOSED PROXY. THIS WILL NOT PREVENT YOU FROM ATTENDING AND VOTING
YOUR SHARES IN PERSON. PROMPT RETURN OF YOUR PROXY WILL REDUCE THE COMPANY'S
EXPENSES IN THIS MATTER.
Only shareholders of record as shown on the books of the Company at the close
of business on September 9, 2003 will be entitled to vote at the Annual Meeting
or any adjournment thereof. A list of the Company's shareholders entitled to
notice of, and to vote at, the Annual Meeting will be made available during
regular business hours at the Company's principal executive offices at 530-999
West Hastings Street, Vancouver, B.C., Canada V6C 2W2 from the date of this
notice for inspection by any shareholder for any purpose germane to the Annual
Meeting. The Annual Meeting may adjourn from time to time without notice other
than by announcement at the Annual Meeting, or at any adjournments thereof, and
any and all business for which the Annual Meeting is hereby noticed may be
transacted at any such adjournments.
By order of the Board of Directors,
M. Kevin Ryan, Chief Executive Officer
EXMAILIT.COM
1999 South Bascom Avenue, Suite 700
Campbell, California 95008
PROXY STATEMENT FOR ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON SEPTEMBER 29, 2003
INFORMATION CONCERNING SOLICITATION AND VOTING
This Proxy Statement is being furnished to shareholders of eXmailit.com (the
"Company") in connection with the Board of Director's solicitation of proxies
for use at the annual meeting of shareholders to be held on September 29, 2003,
and at any adjournment of that meeting (the "Annual Meeting"). The first date on
which this Proxy Statement and the form of Proxy are first being mailed to
shareholders of the Company is on or about September 19, 2003.
The Board of Directors has fixed September 9, 2003 as the record date for
determining stockholders who are entitled to vote at the Annual Meeting. At the
close of business on September 9, 2003, the Company had issued and outstanding
4,000,000 shares of common stock, par value $0.001 (the "Common Stock"), held by
approximately 31 stockholders. Each share of Common Stock is entitled to one
vote on each matter properly coming before the Annual Meeting.
The Company will not solicit proxies personally, by telephone or facsimile.
The Company, however, may make a request by telephone, facsimile, or mail
strictly limited to confirming the shareholder's receipt of the proxy and
requesting that the shareholder sign and return the proxy solicited by this
statement. The Company does not expect to pay compensation to any party for the
solicitation of proxies, but may reimburse brokers, custodians, nominees and
fiduciaries for the expense of forwarding solicitation material and proxies to
beneficial owners of their outstanding stock. The cost of soliciting proxies,
not expected to exceed $10,000, will be borne by the Company.
All proxies will be voted in accordance with the instructions contained
therein, if properly executed and not revoked. Proxies that are signed by
shareholders but that lack any such specification will be voted in favor of the
proposals set forth in the Notice of the Annual Meeting. Management of the
Company does not know of any matters other than those set forth herein which
will be presented for action at the Annual Meeting, but the person named in the
Proxy intends to vote or act with respect to any other proposal which may be
presented for action in accordance with his best judgment. A vote FOR Proposal
#7 will effectively confer authority in the Proxy Holder to vote the shares
covered by the Proxy as the Proxy Holder deems appropriate. A vote AGAINST
Proposal #7 will be treated as shares over which no Proxy is granted and
therefore counted as an abstention from voting on any other business as may
properly come before the Annual Meeting, including any modification or variation
to an existing proposal. Any proxy may be revoked by a stockholder at any time
before it is exercised by giving written notice to that effect to the corporate
secretary of the Company or by voting in person at the Annual Meeting.
A majority of the outstanding shares of Common Stock entitled to vote,
represented in person or by proxy, shall constitute a quorum for transacting
business at the Annual Meeting. Any shares which are withheld or abstain from
voting will be counted for the purpose of obtaining a quorum. Shares held in
"street name" by brokers or nominees and not reflected as held of record on the
Company's shareholder list as of the Record Date may only be voted through the
brokers or nominees absent the submission of a "legal proxy" issued by Automatic
Data Processing, Inc. Shares held in "street name" by brokers or nominees who
indicate that they do not have discretionary authority to vote such shares as to
a particular matter ("broker non-votes") will not be counted as votes "for" or
"against" the proposals, and will not be counted as shares voted on such matter.
The total number of votes cast "for" will be counted for purposes of
determining whether sufficient affirmative votes have been cast to approve each
proposal. Abstentions from voting on a proposal, as well as broker non-votes,
will be considered for purposes of determining the number of total votes present
at the Annual Meeting. Abstentions will have the same effect as votes against
the proposals, in that they will not be voted in favor of a proposal.
The affirmative vote of the holders of a plurality of the shares of Common
Stock present or represented at the meeting is required to elect the Board of
Directors. The selection of KPMG, LLP as the Company's independent accountant
for the current year will be ratified and approved if the number of votes cast
in favor of the proposal exceeds the number of votes cast in opposition to the
proposal. The affirmative vote of the holders of at least a majority of the
voting power of the Common Stock is required to approve an amendment to the
Company's articles of incorporation and bylaws.
Management of the Company has been informed by the executive officers,
directors, and control persons of the Company that such parties intend to vote
all shares they beneficially hold with voting rights FOR all of the proposals
set forth in the notice. Together, such parties and proxies represent
approximately 75.25% of the votes eligible to be cast at the Annual Meeting.
SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information concerning the ownership
of the Company's Common Stock as of September 9, 2003, with respect to: (i) each
person known to the Company to be the beneficial owner of more than five percent
(5%) of the Company's Common Stock; (ii) all directors; and (iii) directors and
executive officers of the Company as a group. As of September 9, 2003, there
were 4,000,000 shares of Common Stock issued and outstanding.
- --------------------------------------------------------------------------------
Name and Address of Amount and Nature of Percent of Class
Title of Class Beneficial Owner Beneficial Ownership (1)
- --------------------------------------------------------------------------------
Executive Officers and Directors
- --------------------------------------------------------------------------------
Common Stock M. Kevin Ryan
($0.001 par 4338 Bergano Drive
value) Encino, CA 91436 1,500,000 37.5%
- --------------------------------------------------------------------------------
Common Stock Robert Gardner
($0.001 par 530-999 W. Hastings Street
value) Vancouver, BC V6C 2W2 1,510,000 37.8%
- --------------------------------------------------------------------------------
Common Stock Directors and Executive
($0.001 par Officers as a Group 3,010,000 75.3%
value) (2 individuals)
- --------------------------------------------------------------------------------
(1) The number of shares and the percentage of the class beneficially owned by
the entities above are determined under rules promulgated by the SEC and
the information is not necessarily indicative of beneficial ownership for
any other purpose.
MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
The Company's Common Stock has traded on the OTC Bulletin Board under the
symbol "EXMA" since September 3, 2002. However, as of September 9, 2003, no
meaningful trading market for the Company's Common Stock has occurred.
Shareholders
The Company is authorized to issue One Hundred Million (100,000,000)
shares of Common Stock. As of September 9, 2003, there were approximately
thirty-one (31) shareholders holding a total of Four Million (4,000,000) shares
of Common Stock.
Dividends on the Common Stock
The Company has never declared a cash dividend on its Common Stock and
does not anticipate the payment of future dividends. There are no restrictions
that currently limit the Company's ability to pay dividends on its Common Stock
other than those generally imposed by applicable state law.
DESCRIPTION OF BUSINESS
As used herein, the term "Company" refers to eXmailit.com., a Nevada
corporation, and its subsidiaries and predecessors, unless the context indicates
otherwise. The Company was incorporated on April 6, 2000, to engage in the
business of providing Internet-based email-to-mail printing and delivery
services. The Company established the eXmailit.com website which has not yet
commenced providing an Internet-based email-to-mail service. The network, which
is still under construction, was intended to consist of a consumer-based,
2
software product that would have a number of strategically located international
distribution centers enabling users to send email as standard mail.
On August 29, 2003, the Company executed a Stock Exchange Agreement
("Agreement") with Cirond Technologies Inc., a Colorado corporation ("Cirond").
The Agreement is expected to close on or about September 29, 2003 ("Closing").
Pursuant to the Agreement, the Company agreed to acquire all of the issued and
outstanding capital stock of Cirond's wholly owned subsidiary, Cirond Networks
Inc., a Nevada corporation ("CNI"), in exchange for Four Million (4,000,000)
post- Forward Split shares ("Shares") of the Company's common stock, par value
$0.001 ("Common Stock"). The Company's Forward Split is discussed more fully
below. As a result of the Agreement, in the event it closes, CNI will become a
wholly- owned subsidiary of the Company, and Cirond will become the owner of
approximately 20% of the Company.
CNI is a developer of technologies designed to enhance the performance and
security of wireless networking technologies, with an initial specific focus on
802.11b Wireless Local Area Network ("WLAN") technology. WLAN is one in which a
mobile user can connect to a local area network (LAN) through a wireless (radio)
connection. The 802.11b standard for WLANs - often called Wi-Fi - is part of the
802.11 series of WLAN standards from the Institute of Electrical and Electronics
Engineers (IEEE).
CNI manufacturers products incorporating its proprietary technology that
are applicable to all segments of the WLAN marketplace. Cirond's products are
principally focused on WiFi network management and implementation, and enable
WiFi networks to be installed easily, operated optimally, and managed more
effectively and also offer improvements to network security by offering a robust
security system suitable for most typical business environments. Cirond's
approach to WiFi security is to provide technologies that improve the overall
security and implementation of the WEP security scheme, while buttressing it
with a variety of propriety intrusion detection and location-enabled security
and access technologies. CNI conducts its research and development activities
through its subsidiary, Cirond Networks (Canada) Inc., a British Columbia
corporation.
In connection with the Agreement, the Company agreed to use its best
efforts, prior to Closing, to cancel 2,990,000 shares of Common Stock held by
its founders (the "Share Cancellation"), and to effect a 16-for-1 forward stock
split ("Forward Split") of the 1,010,000 shares of Common Stock which would be
outstanding after the Share Cancellation. In the event the Forward Stock Split
is not effected prior to Closing, the Company will issue to Cirond at Closing
Two Hundred Fifty Thousand (250,000) pre-Forward Split shares of Common Stock
(which would represent approximately 20% of the Company's then issued and
outstanding shares of Common Stock without giving effect to the Private
Placement), the equivalent to the Four Million (4,000,000) post-Forward Split
shares.
Closing of the Agreement is subject to the Company and Cirond conducting
additional due diligence and the Company raising at least $300,000 pursuant to a
private placement offering ("Private Placement") of not more than 2,000,000
shares of post-Forward Split Common Stock, at a price of $0.50 per share. Any
monies raised will be held in escrow until Closing. If the Closing occurs, the
monies will be used to fund CNI's operations. If the Closing does not occur, the
money will be returned to the subscribers. The Agreement may be terminated by
either party if the Closing does not occur on or prior to October 15, 2003.
In the event the Closing occurs, the Company's current management will
resign, and the board of directors elected at the Annual Meeting will appoint
new officers.
Competition
The Company will be operating in the competitive area of enterprise
network infrastructure. The Company's competitors include major
telecommunications companies, many of which possess greater financial and other
resources than the Company.
Employees
To initially maintain low overhead expenses, its (2) officers are
presently directing operations of the Company.
MANAGEMENT'S DISCUSSION AND ANALYSIS AND PLAN OF OPERATION
Forward-looking Information
This information statement contains forward-looking statements. For this
purpose, any statements contained herein that are not statements of historical
fact may be deemed to be forward-looking statements. These statements relate to
future events or to our future financial performance. In some cases, you can
identify forward-looking statements by terminology such as "may," "should,"
"expects," "plans," "anticipates," "believes," "estimates," "predicts,"
"potential" or "continue" or the negative of such terms or other comparable
terminology. These statements are only predictions. Actual events or results may
3
differ materially. There are a number of factors that could cause our actual
results to differ materially from those indicated by such forward-looking
statements.
Although the Company believes that the expectations reflected in the
forward-looking statements are reasonable, it cannot guarantee future results,
levels of activity, performance, or achievements. Although all such
forward-looking statements are accurate and complete as of this proxy statement,
the Company cannot predict whether the statements will ultimately be accurate
and consequently do not assume responsibility for the ultimate accuracy and
completeness of such forward-looking statements. The Company is under no duty to
update any of the forward-looking statements after the date of this information
statement to conform such statements to actual results. The foregoing
management's discussion and analysis should be read in conjunction with the
Company's financial statements and the notes herein.
Overview
As a result of our lack of profitability and the Company's receipt of
numerous inquires from entities seeking to merge with us, we decided to change
our operational focus in August, 2003 by executing a Stock Exchange Agreement to
acquire CNI. If the agreement closes, the Company's operations will then consist
of the development, production and sales of WLAN related products and
technology. The Company is currently in the development stage and has not yet
fully commenced their business and, as a result, has not yet generated any
revenues.
The Company believes it has sufficient cash to satisfy its operating
requirements for in excess of six (6) months. If the cash is not enough to
satisfy the Company's operating needs and it is unable to generate revenues
and/or obtain bank loans on favorable terms and/or sell additional shares of its
equity securities to secure the cash required to conduct its business operations
for the next twelve (12) months, the Company could fail.
In the event the Company acquires CNI, it will be conducting ongoing
research and development to refine and improve its existing product line and to
develop new products. During the next twelve months, provided it acquires CNI,
the Company plans to hire a Chief Executive Officer, sales and marketing
personnel, and product support staff.
FINANCIAL STATEMENTS
The Company's financial statements for the fiscal year ended
December 31, 2002 and the quarter ended June 30, 2003 are attached hereto
beginning on page F-1.
PROPOSAL NO. 1
ELECTION OF DIRECTORS
The Board of Directors has determined that there will be one (1) director
of the Company elected at the Annual Meeting. The Board of Directors has
nominated Nicholas Miller. In the absence of other instructions, the proxies
will be voted for the individual named, whom the Board proposes for election as
a director of the Company. If elected, such individual will serve until the next
Annual Meeting of shareholders or until his successor is duly elected and
qualified.
The Board recommends a vote FOR the election of the nominee listed below.
Nomination of Director
The Board has no reason to believe that the nominee would be unable or
unwilling to serve if elected. If the nominee becomes unable or unwilling to
accept nomination or election, the Board will select a substitute nominee. If
you have submitted a proxy and a substitute nominee is selected, your shares
will be voted for the election of the substitute nominee.
About the Director
Set forth below is biographical and other information about the person who
will make up the Board following the annual meeting, presuming election of the
nominee named above. The director of the Company will hold office until the next
annual meeting of shareholders of the Company or until a successor is duly
elected and qualified.
4
Nicholas Miller, age 51, is an entrepreneur who has founded a number of
private and publicly traded companies in the software, wireless, and Internet
sectors. Mr. Miller's wide ranging experience as a high technology executive
includes over 20 years of direct operations responsibility, along with
considerable experience in sales, marketing and technology start-ups. From June
1996 to February 1998, Mr. Miller served as the Chairman of the Board,
Secretary, Treasurer and a director of DataLink Systems Corporation (now Semotus
Solutions Inc.), a company in the wireless information services sector, based in
San Jose, California. Semotus Solutions is publicly traded on the American Stock
Exchange (AMEX: DLK). Mr. Miller had founded DataLink's wholly-owned Canadian
subsidiary, DSC DataLink Systems, in June 1993. From February 1987 until June
1993, he was the owner and President of Arundel Holdings Inc., a management
consulting company which provided consulting services to emerging growth
companies in the United States and Canada. From June 1987 until May 1988, he
served as President of two companies: Tai Capital Corporation, a U.S. and
Canadian based holding company specializing in the syndication of limited
partnerships and in the financing of emerging growth companies; and Accessgroup,
a company specializing in financial communications for public emerging growth
and resource based companies. From February 1984 until February 1987, he was
President and founder of Sona Systems Corporation, a company engaged in
developing and marketing microcomputer software products. From March 1982 until
February 1984, he was President and founder of Canada Microsystems Ltd., a
wholesale distributor and developer of microcomputer based software products.
Mr. Miller also recently served as a Director of Ezenet Technologies (acquired
by Cognicase), Workfire Technologies (acquired by Packeteer Inc.), and was an
initial founder of TalkStar Inc. (now E-Voice Inc., acquired by AOL Time
Warner). Mr. Miller is also Vice-Chairman and a Director of Mulgrave School, an
independent school based in West Vancouver, Canada. (Mr. Miller was instrumental
in assisting Mulgrave to become one of the first schools in North America to
implement a campus-wide WLAN network and a related laptop program). Mr. Miller
is the holder of two US patents related to wireless technology and the Internet.
Compliance with Section 16(a) of the Exchange Act
Based solely upon a review of Forms 3, 4 and 5 furnished to the Company,
the Company is not aware of any person who at any time during the fiscal year
ended December 31, 2002, was a director, officer, or beneficial owner of more
than ten percent of the Common Stock of the Company, and who failed to file, on
a timely basis, reports required by Section 16(a) of the Securities Exchange Act
of 1934 during such fiscal year.
EXECUTIVE COMPENSATION
No compensation has been awarded to, earned by, or paid to any executive
officer of the Company during the fiscal years 2002, 2001 and 2000. The
following table provides summary information for the years 2002, 2001 and 2000
concerning cash and noncash compensation paid or accrued by the Company to or on
behalf of the Company's chief executive officer.
SUMMARY COMPENSATION TABLES
----------------------------
Annual Compensation
----------------------------
Name and Other Annual
Principal Position Year Salary ($) Bonus ($) Compensation ($)
- -------------------------------------------------------------------------------
M. Kevin Ryan,
President 2002 -0- -0- -0-
- -------------------------------------------------------------------------------
M. Kevin Ryan,
President 2001 -0- -0- -0-
- -------------------------------------------------------------------------------
M. Kevin Ryan, 2000
President -0- -0- -0-
- -------------------------------------------------------------------------------
5
-----------------------------------------------
Long Term Compensation
-----------------------------------------------
Awards Payouts
-----------------------------------------------
Restricted Stock Securities Underlying LTIP All Other
Name and Principal Award(s)($) Options/SARs(#) Payouts Compensation
Position Year ($) ($)
- --------------------------------------------------------------------------------
M. Kevin Ryan,
President 2002 -0- -0- -0- -0-
- --------------------------------------------------------------------------------
M. Kevin Ryan,
President 2001 -0- -0- -0- -0-
- --------------------------------------------------------------------------------
M. Kevin Ryan,
President 2000 -0- -0- -0- -0-
- --------------------------------------------------------------------------------
Director Compensation
The Company's directors are not compensated for any meeting of the board
of directors that they attend.
PROPOSAL 2
RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS
Subject to ratification by the shareholders, the Board has selected KPMG,
LLP to audit the financial statements of the Company for the fiscal year ending
December 31, 2003. Although shareholder approval of the board of directors'
selection of KPMG, LLP is not required by law, the board of directors believes
that it is advisable to give shareholders an opportunity to ratify this
selection. If the shareholders do not approve this proposal at the Annual
Meeting, the board of directors may reconsider the selection of KPMG, LLP.
Representatives of KPMG, LLP and Parker & Co., the Company's current
accountant, are not expected to be present at the Meeting.
The Board recommends a vote FOR the ratification of the appointment of
KPMG, LLP as the Company's independent auditors.
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
DISCLOSURE
On September 8, 2003, the board of directors of the Company appointed
KPMG, LLP as the Company's independent auditor for the fiscal year ended
December 31, 2003. This appointment represented a change in the Company's
auditor from Parker & Co. ("Parker"). Parker was dismissed by the board of
directors of the Company on September 8, 2003. The decision to dismiss Parker
was approved by the Company's board of directors and was prompted by the fact
that the Company's management is expected to change with the Company's
acquisition of CNI.
There were no disagreements with Parker on any matter of accounting
principles or practices, financial statement disclosure, or auditing scope or
procedure during the Company's two most recent fiscal years and any subsequent
interim period through the date of dismissal. Parker's report on the financial
statements for either of the past two years did not contain an adverse opinion
or disclaimer of opinion, and have not been modified as to uncertainty, audit
scope or accounting principles.
6
INDEPENDENT PUBLIC ACCOUNTANTS
Audit Fees
The aggregate fees billed to the Company by Parker & Co. for the audit of
its annual financial statements for the fiscal year ended December 31, 2002 and
for the reviews of the financial statements included in the Company's quarterly
reports on Form 10-QSB for that fiscal year were $2,477.
The aggregate fees billed to the Company by Parker & Co. for the audit of
its annual financial statements for the fiscal year ended December 31, 2001 and
for the reviews of the financial statements included in the Company's quarterly
reports on Form 10-QSB for that fiscal year were $1,657.
Audit-Related Fees
Parker & Co. did not bill the Company for any assurance and related
services reasonably related to the performance of the audit or review of the
Company's financial statements which are not disclosed above.
Tax Fees
Parker & Co. did not bill the Company for professional services rendered
for tax compliance, tax advice, and tax planning in fiscal 2001 or 2002.
Financial Information Systems Design and Implementation Fees
Parker & Co. did not perform any information technology services relating
to financial information systems design and implementation for the fiscal years
ended December 31, 2001 and December 31, 2002.
All Other Fees
There were no other fees billed to the Company by Parker & Co. for the
last two fiscal years.
The Company's Board of Directors has determined that the provision of
services by Parker & Co. as set forth above, was compatible with maintaining the
principal accountant's independence.
PROPOSAL NO. 3
AMENDMENT TO THE COMPANY'S ARTICLES
OF INCORPORATION TO CHANGE ITS NAME
On September 8, 2003, the board of directors adopted resolutions, subject
to shareholder approval, to amend the Company's articles of incorporation to
change the Company's name from eXmailit.com to Cirond Corporation, subject to
closing of the Stock Exchange Agreement between the Company and Cirond
Technologies Inc. In the event the Stock Exchange Agreement does not close, the
Company's name will not change to Cirond Corporation. Although the Company has
not yet acquired Cirond Networks Inc. from Cirond Technologies Inc., the board
of directors believes seeking shareholder approval for this name change will
provide the most flexibility and efficiency for the Company if it does
consummate the transaction.
The principal purpose for the name change is to more accurately reflect
the Company's expected shift in operational focus to the development, production
and sales of WLAN related products and technology as a result of the acquisition
of Cirond Networks, Inc. pursuant to the Stock Exchange Agreement with Cirond
Technologies, Inc. For more information on the Agreement, see "Description of
Business."
The board of directors recommends a vote FOR the approval of the amendment
to the Company's articles of incorporation changing the Company's name to Cirond
Corporation.
7
PROPOSAL NO. 4
AMENDMENT TO ARTICLES OF INCORPORATION AUTHORIZING
A CLASS OF PREFERRED STOCK
On September 8, 2003, the board of directors adopted resolutions, subject
to shareholder approval, to amend the Company's articles of incorporation to
authorize a new class of 25,000,000 shares of preferred stock, par value $0.001.
The principal purpose for the creation of a class of preferred stock is to
increase the Company's flexibility in obtaining additional financing for the
Company's operations. The board of directors would be granted the authority to
issue shares of the preferred stock in one or more series, and to designate the
number, voting powers, preferences, relative rights, qualifications,
limitations, restrictions, and other distinguishing characteristics of each
series to be issued.
The Company believes financing opportunities may be available which would
require the issuance of a class of securities with rights superior to that of
its Common Stock, but it has no present intention, plan, agreement or
understanding to issue any shares of preferred stock.
The board of directors recommends a vote FOR the approval of the amendment
to the Company's articles of incorporation authorizing a class of 25,000,000
shares of preferred stock.
DESCRIPTION OF SECURITIES
The Company is authorized to issue One Hundred Million (100,000,000)
shares of Common Stock, $0.001 par value. The holders of Common Stock are
entitled to equal dividends and distributions, with respect to the Common Stock
when, as, and if declared by the board of directors from funds legally available
for such dividends. No holder of Common Stock has any preemptive right to
subscribe for any of the Company's stock nor are any shares subject to
redemption. Upon liquidation, dissolution or winding up of the Company, and
after payment of creditors, the assets will be divided pro rata on a share-for-
share basis among the holders of the shares of Common Stock.
The Common Stock is listed for trading on the OTC-BB under the symbol
"EXMA." No meaningful trading market has developed since the Company's Common
Stock was approved for trading on September 3, 2002.
The articles of incorporation of the Company currently do not provide
authority for a separate class of preferred stock, but Proposal No. 4 herein
recommends an amendment to the Company's articles of incorporation allowing the
creation of a new class of 25,000,000 authorized shares of preferred stock, par
value $0.001.
PROPOSAL NO. 5
RATIFICATION OF A 16-FOR-1 FORWARD STOCK SPLIT
OF THE COMPANY'S ISSUED AND OUTSTANDING COMMON STOCK
On September 8, 2003, the board of directors adopted resolutions, subject
to shareholder ratification, to approve a sixteen-for-one (16-for-1) forward
stock split ("Forward Stock Split") of the Company's issued and outstanding
shares of Common Stock. Although shareholder approval of the Forward Stock Split
is not required by the Company's articles of incorporation, bylaws or state law,
the board of directors believes that it is advisable to give shareholders an
opportunity to ratify this proposal. If the shareholders do not approve this
proposal at the Annual Meeting, the board of directors may reconsider the
Forward Stock Split.
The board believes it to be in the best interests of the Company to
increase the number of issued and outstanding Common Stock. Reasons for this
include the board's desire to make more shares available and broaden its
stockholder base thereby improving trading liquidity, and to enhance the
Company's flexibility in connection with possible future actions, such as stock
dividends, corporate mergers, acquisitions of property, the funding of its
business, or other corporate purposes.
Although the Company has not yet experienced identifiable problems in the
marketability and liquidity of its Common Stock, the Company believes that the
number of shares outstanding before the Forward Stock Split may, as compared to
the number of shares outstanding after the Forward Stock Split, limit its
effective marketability because of the reluctance of investors to purchase
higher-priced stocks. The Company believes that more people will want to buy a
security at $1 rather than at $16, for example. Accordingly, as more people are
8
expected by management to buy a security at a lower price, that security should
rise in price, broadening the marketability and increasing the distribution of
the security to all investors.
As of September 9, 2003, the number of issued and outstanding shares of
Common Stock was 4,000,000. In the event the Stock Exchange Agreement between
the Company and Cirond Technologies Inc. closes, 2,990,000 shares of Common
Stock will be cancelled leaving 1,010,000 shares of Common Stock outstanding.
Therefore, based upon the Company's best estimates, the number of issued and
outstanding shares of Common Stock will be increased from 1,010,000 to
16,160,000 as a result of the Forward Stock Split. The number of shareholders of
record is not expected to change as a result of the Forward Stock Split.
The Common Stock is registered under Section 12(g) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and as a result, the
Company is subject to the periodic reporting and other requirements of the
Exchange Act. The Forward Stock Split will not affect the registration of the
Common Stock under the Exchange Act and the Company has no present intention of
terminating the registration under the Exchange Act. Consummation of the Forward
Stock Split will not alter the number of authorized shares of Common Stock.
Proportionate voting rights and other rights of shareholders will not be altered
by the Forward Stock Split.
Federal Income Tax Consequences of the Proposed Forward Stock Split
The following discussion describes certain federal income tax consequences
of the Forward Stock Split to shareholders of the Company who are citizens or
residents of the United States, and who are not dealers with respect to the
Common Stock. The actual consequences for each shareholder will be governed by
the specific facts and circumstances pertaining to his acquisition and ownership
of the Common Stock. Thus, the Company makes no representations or warranties
concerning the tax consequences for any of its shareholders and recommends that
each shareholder consult with his tax advisor concerning the tax consequences
(including federal, state, local and foreign income or other tax consequences)
of the Forward Stock Split. The Company has not sought and will not seek an
opinion of counsel or a ruling from the Internal Revenue Service regarding the
federal income tax consequences of the Forward Stock Split. However, the Company
believes that if a shareholder receives additional stock from the Forward Stock
Split, there is no tax consequence until the shareholder decides to liquidate
his/her position. Further, the Company believes that the Forward Stock Split
will be a "recapitalization" for purposes of Section 368(a)(1)(E) of the
Internal Revenue Code, which should have the following federal income tax
consequences for the shareholders and the Company:
o A shareholder will not recognize gain or loss with respect to the new
Common Stock received in exchange for the old Common Stock. The
adjusted basis and holder period of the shares of new Common Stock
received will be the same as the adjusted basis and holding period of
the old Common Stock surrendered; and
o The Company will not recognize any gain or loss as a result of the
Forward Stock Split.
The board of directors recommends a vote FOR the ratification of a
16-for-1 Forward Stock Split of the Company's issued and outstanding Common
Stock.
PROPOSAL NO. 6
RATIFICATION OF A BYLAW AMENDMENT
CHANGING THE QUORUM REQUIREMENT
On September 8, 2003, the board of directors adopted resolutions, subject
to ratification by the shareholders of the Company, amending the Company's
bylaws to change the quorum requirement for shareholder's meetings.
The board of directors of the Company has amended section 2.7 of the
bylaws to state the following:
"Twenty percent (20%) of the outstanding shares of the corporation
entitled to vote, represented in person or by proxy, shall constitute a
quorum at a meeting of shareholders. If less than twenty percent (20%) of
the outstanding shares are represented at a meeting, a majority of the
shares so represented may adjourn the meeting from time to time without
further notice. At such adjourned meeting at which a quorum shall be
present or represented, any business may be transacted which might have
been transacted at the meeting as originally notified. The shareholders
9
present at a duly organized meeting may continue to transact business
until adjournment, notwithstanding the withdrawal of enough shareholders
to leave less than a quorum. Once a share is represented for any purpose
at a meeting, it is deemed present for quorum purposes for the remainder
of the meeting and for any adjournment of that meeting, unless a new
record date is or must be set for that adjourned meeting.
If a quorum exists, a majority vote of those shares present and voting at
a duly organized meeting shall suffice to defeat or enact any proposal
unless the Statutes of the State of Nevada, the Articles of Incorporation
or these Bylaws require a greater-than-majority vote, in which event the
higher vote shall be required for the action to constitute the action of
the corporation."
The principal purpose of the amendment to the bylaws is to ensure that
shareholder meetings convene and are conducted efficiently.
Although shareholder approval of the board of directors' amendment of the
bylaws is not required by the bylaws or state law, the board of directors
believes that it is advisable to give shareholders an opportunity to ratify this
amendment. If the shareholders do not approve this proposal at the Annual
Meeting, the board of directors may reconsider the amendment to the Company's
bylaws.
The board of directors recommends a vote FOR the ratification of the
amendment to the Company's bylaws.
PROPOSAL NO. 7
OTHER BUSINESS
The board of directors is not aware of any business to come before the
meeting other than those matters described above in this proxy statement. If,
however, any other matters should properly come before the meeting, the persons
acting under proxies in the enclosed proxy card will vote thereon in accordance
with their best judgment.
A vote FOR Proposal #7 will effectively confer authority in the Proxy
Holder to vote the shares covered by the Proxy as the Proxy Holder deems
appropriate. A vote AGAINST Proposal #7 will be treated as shares over which no
Proxy is granted and therefore counted as an abstention from voting on any other
business as may properly come before the Annual Meeting, including any
modification or variation to an existing proposal. Any proxy may be revoked by a
stockholder at any time before it is exercised by giving written notice to that
effect to the corporate secretary of the Company or by voting in person at the
Annual Meeting.
DEADLINE FOR SUBMISSION OF SHAREHOLDER PROPOSALS
Proposals of shareholders that are intended to be presented at the
Company's next Annual Meeting must have been received by the Company not later
than a reasonable time before the Company begins to print and mail its proxy
materials under the provisions of Rule 14a-8 of the Securities Exchange Act of
1934.
The person presiding at the next annual meeting may refuse to permit to be
brought before the meeting any shareholder proposal not made in compliance with
Rule 14a-8.
10
ANNUAL REPORT
The Company will provide without charge to each shareholder of record as
of September 9, 2003, upon the written request of such person, a copy of the
Company's Form 10-KSB, including the financial statements, for the year ending
December 31, 2002. A copy of any exhibit to the Company's Form 10-KSB may also
be obtained from the Company at no charge upon written request for each such
exhibit requested. Such written requests should be sent to M. Kevin Ryan,
President, eXmailit.com, 1999 South Bascom Avenue, Suite 700, Campbell,
California 95008
BY THE ORDER OF THE BOARD OF DIRECTORS:
/s/ M. Kevin Ryan
---------------------------------------
M. Kevin Ryan, President
Vancouver, B.C.
September 10, 2003
11
Xmailit.com
A DEVELOPMENT STAGE COMPANY F I N A N C I A L S T A T E M E N T S FOR THE YEARS
ENDED 31 DECEMBER 2002 AND 2001 Audited - See Independent Auditor's Report
F-1
P A R K E R & C O.
CHARTERED ACCOUNTANTS
Page 1 of 7
200 - 2560 Simpson Road, Richmond BC V6X 2P9
Tel: (604) 276-9920 Fax: (604) 276-4577
- --------------------------------------------------------------------------------
I N D E P E N D E N T A U D I T O R ' S R E P O R T
We have audited the statement of financial position of eXmailit.com a
development stage company, as at 31 December 2002 and 2001 and the statements of
results of operations and cash flow for the years ended 31 December 2002 and
2001 and the statement of changes in shareholders' equity from inception, 6
April 2000, to 31 December 2002. These financial statements are the
responsibility of the company's management. Our responsibility is to express an
opinion on these financial statements based on our audit.
We conducted our audit in accordance with generally accepted auditing standards
in the United States of America. Those standards require that we plan and
perform an audit to obtain reasonable assurances whether the financial
statements are free of material misstatements. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial presentation. We believe that our audit provides a reasonable basis
for our opinion.
In our opinion, these financial statements present fairly, in all material
respects, the financial position of the company as at 31 December 2002 and 2001;
the result of its operations and cash flow for the years ended 31 December 2002
and 2001; and changes in stockholder's equity from inception, 6 April 2000, to
31 December 2002 in accordance with generally accepted accounting principles in
the United States.
These financial statements have been prepared assuming the company will continue
as a going concern. As stated in Note 2 to the financial statements, the company
will require an infusion of capital to sustain itself. This requirement for
additional capital raises substantial doubt about the company's ability to
continue as a going concern. The financial statements do not include any
adjustments that might result from the outcome of this uncertainty.
Richmond, British Columbia, Canada
21 March 2003
/s/ PARKER & CO.
- ---------------------
CHARTERED ACCOUNTANTS
F-2
eXmailit.com
A DEVELOPMENT STAGE COMPANY
S T A T E M E N T O F F I N A N C I A L P O S I T I O N
Unaudited - See Independent Auditor's Report
- --------------------------------------------------------------------------------
AS AT 31 DECEMBER 2002 2001
--------- ---------
CURRENT ASSETS
Cash $ 19,295 $ 46,613
--------- ---------
Total current assets 19,295 46,613
--------- ---------
EQUIPMENT AND SOFTWARE, NOTE 33
Office and computer equipment and software,
at cost 14,560 11,732
Accumulated amortization 6,557 3,772
--------- ---------
Unamortized cost 8,003 7,960
--------- ---------
TOTAL ASSETS $ 27,298 $54,573
========= =========
CURRENT LIABILITIES
Accounts payable $ 2,250 $ 1,038
Loans payable, Note 4 75,000 75,000
--------- ---------
Total current liabilities 77,250 76,038
--------- ---------
DEFICIENCY IN ASSETS
Share capital, Note 5 4,000 4,000
Additional paid in capital 49,000 49,000
Currency Translation Adjustment 1,691 -
Deficit accumulated during the development stage (104,643) (74,465)
--------- ---------
Total stockholders' equity (deficiency in assets (49,952) (21,465)
--------- ---------
TOTAL LIABILITIES AND DEFICIENCY IN ASSETS $ 27,298 $54,573
========= =========
F-3
eXmailit.com
A DEVELOPMENT STAGE COMPANY
S T A T E M E N T O F R E S U L T S OF O P E R A T I O N S
Audited - See Independent Auditor's Report
- --------------------------------------------------------------------------------
FOR THE FOR THE FROM INCEPTION
YEAR ENDED YEAR ENDED 6 APRIL 2000
31 DECEMBER 31 DECEMBER TO 31 DECEMBER
2002 2001 2001
--------------------------------------------------
EXPENSES
Accounting $ 3,500 $ 409 $ 4,581
Advertising - - 647
Amortization 2,785 4,983 11,269
Bank charges 166 356 804
Dues, subscriptions and fees 378 1,317 1,816
Legal and professional fees 20,564 27,807 39,761
Office supplies 423 1,347 3,397
Postage and courier 49 187 458
Rent - 355 14,890
Telephone 1,639 1,405 4,410
Travel - 5,109 7,622
Utilities - - 153
Exchange losses 674 2,999 4,335
----------- ---------- ----------
Total expenses 30,178 46,274 94,143
----------- ---------- ----------
OTHER INCOME
Interest earned $ - $ 33 $ 554
------------ ---------- ----------
LOSS BEFORE INCOME TAXES (30,178) (46,241) (104,643)
INCOME TAXES, NOTE 7 - - -
------------ --------- ----------
LOSS (30,178) (46,241) (104,643)
============ ========= ==========
LOSS PER SHARE, NOTE 8 ($0.01) ($0.01) ($0.03)
============ ========= ==========
WEIGHTED AVERAGE NUMBER OF SHARES 4,000,000 3,276,712 3,478,931
============ ========= ==========
F-4
eXmailit.com
A DEVELOPMENT STAGE COMPANY STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY FOR THE
YEARS ENDED 31 DECEMBER 2002 AND 2001 Audited - See Independent Auditor's Report
- --------------------------------------------------------------------------------
COMMON COMMON ADDITIONAL CURRENCY DEFICIT
STOCK STOCK PAID IN TRANSLATION ACCUMULATED
ISSUED AMOUNT CAPITAL ADJUSTMENT DURING THE
DEVELOPMENT
CONSIDERATION STAGE TOTAL
Private placement for
cash on 10 April 2000 3,000,000 $3,000 $ 0 $ 0 $ 3,000
Net loss from inception,
6 April 2000, to
31 December 2000 ($28,224) (28,224)
--------------------------------------------------------
Balance as at
31 December 2000 3,000,000 3,000 - - (28,224) (25,224)
Private placement
for cash on
20 September 2001 1,000,000 1,000 49,000 - 50,000
Net loss for the year
ended 31 December 2001 (46,241) (46,241)
--------------------------------------------------------
Balance as at
31 December 2001 4,000,000 4,000 49,000 (74,465) (21,465)
Net loss for the year
ended 31 December 2002 (30,178) (30,178)
Currency Translation
Adjustment As at
31 December 2002 1,691 1,691
--------------------------------------------------------
Balance as at
31 December 2002 4,000,000 $4,000 $49,000 $1,691 $(104,643)$(49,952)
========================================================
F-5
eXmailit.com
A DEVELOPMENT STAGE COMPANY S T A T E M E N T O F C A S H F L O W S
Audited - See Independent Auditor's Report
- --------------------------------------------------------------------------------
FOR THE FOR THE FROM INCEPTION
YEAR ENDED YEAR ENDED 6 APRIL 2000
31 DECEMBER 31 DECEMBER TO 31 DECEMBER
2002 2001 2001
---------------------------------------------
CASH PROVIDED (USED) FROM
OPERATIONS
Net loss $ (30,178) $ ($46,241) $ (104,643)
Items not involving cash
Amortization of equipment
and software cost 2,785 4,983 11,269
Office equipment exchanged
for consulting services - 15,354 15,354
---------- ----------- -----------
Total cash used for the loss (27,393) (25,904) (78,020)
---------- ----------- -----------
Changes in working capital other than cash:
Due from a shareholder - 3,632 -
Deposit - 131 -
Accounts payable 1,212 380 2,250
Loan payable - - 75,000
---------- ----------- -----------
Total changes in working capital 1,212 4,143 77,250
---------- ----------- -----------
Total cash used in operations (26,181) (21,761) (770)
---------- ----------- -----------
CASH PROVIDED (USED) BY
INVESTMENT ACTIVITY
Acquisition of equipment and
software (2,828) (5,059) (34,626)
---------- ----------- -----------
CASH PROVIDED (USED) BY FINANCING
ACTIVITY
Issue of common stock - 50,000 53,000
Currency translation adjustment 1,691 - 1,691
---------- ----------- -----------
Total cash provided by financing 1,691 50,000 54,691
---------- ----------- -----------
CASH CHANGE (27,318) 23,180 19,295
CASH BEGINNING 46,613 23,433 -
---------- ----------- -----------
CASH ENDING $ 19,295 $ 46,613 $ 19,295
========== =========== ===========
COMPRISED OF:
Cash $ 19,295 $ 46,613 $ 19,295
========== =========== ===========
F-6
eXmailit.com
A DEVELOPMENT STAGE COMPANY
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S FOR THE YEARS ENDED 31
DECEMBER 2002 AND 2001 Audited - See Independent Auditor's Report
- ------------------------------------------------------------------------------
Note 1 THE CORPORATION AND ITS BUSINESS
eXmailit.com was incorporated in the State of Nevada, United States on 6 April
2000. The company has a total of 100,000,000 authorized shares with a par value
of $0.001 per share with 4,000,000 shares issued and outstanding as at 31
December 2002.
The company has offices in Vancouver, British Columbia, Canada. The company has
been organized to operate an online email to mail service network on the
internet. The company is a development stage company which has not derived any
revenue from its operations. The fiscal year end of the Company is 31 December.
Note 2 SUMMARY OF SIGNIFICANT ACCOUNTING PRINCIPLES
These financial statements have been prepared using United States Generally
Accepted Accounting Principles as established by the American Institute of
Certified Public Accountants and have been stated in United States dollars
rounded to the nearest whole dollar except for the loss per share which has been
rounded to the nearest cent. These accounting principles are applicable to a
going concern, which contemplates the realization and liquidation of liabilities
in the normal course of business. Current business activities have just begun
and insufficient revenue has been generated to sustain the company as a going
concern without the infusion of additional capital.
Assets and liabilities of operations on foreign countries are translated into
U.S. dollars using the exchange rate at the statement of financial position date
for monetary assets and liabilities or the historical rates for the non-monetary
assets. Accordingly, the company's primary functional currency is the Canadian
dollar and as a result, the company operates a Canadian dollar bank account
which was translated into United States of America dollars at the exchange rate
at the statement of financial position date. Transactions made in Canadian
dollars or other foreign currencies were translated at the average exchange
rates prevailing throughout the year. The effect of exchange rate fluctuations
on translating foreign currency assets and liabilities into U.S. dollars are
included in stockholders' equity, while gains and losses resulting from foreign
currency transactions are included in operations.
Revenue is recorded as a sale at the time the services contracted for have been
completed. Costs are recorded at the time an obligation to pay occurs and are
expensed at the time the benefit to the company is matched to revenue or, if
there is no matching revenue, to the period in which the benefit is realized.
F-7
Equipment and software are all amortized at 20% on the declining balance.
Note 3 EQUIPMENT AND COMPUTER SOFTWARE
ACCUMULATED UNAMORTIZED UNAMORTIZED
AT COST AMORTIZATION COST COST
31 DECEMBER 31 DECEMBER 31 DECEMBER 31 DECEMBER
2002 2002 2002 2001
----------- ------------ ----------- -----------
Office furniture $ 1,982 $ 808 $ 1,174 $ 1,309
Computer equipment 2,828 2,045 783 -
Computer software 5,616 2,088 3,528 3,865
Leasehold improvements 4,134 1,616 2,518 2,786
----------- ------------ ---------- ------------
$ 14,560 $ 6,557 $ 8,003 $ 7,960
=========== ============ ========== ============
Note 4 LOANS PAYABLE
The loans payable were repayable on August 12, 2001. Interest at the rate of 15%
per annum may be charged after the loans maturity at the option of the holder.
If payment is not paid within 30 days of the due date, then liquidation damages
equal to 5% of the overdue amount will be added to the balance owing. The
interest for 2002 and the liquidation damages have been waived and the loan
repayment terms have been extended indefinitely, with a provision that the notes
cannot be demanded.
NOTE 5 SHARE CAPITAL
The authorized share capital is 100,000,000 shares with a par value of $0.001.
4,000,000 common share have been issued as follows:
ADDITIONAL
SHARE PAID IN
CONSIDERATION DATE ISSUED CAPITAL CAPITAL TOTAL
- -------------------------------------------------------------------------
Private placement
for cash 4-10-00 3,000,000 $3,000 $ 0 $3,000
Private placement
for cash 9-20-01 1,000,000 1,000 49,000 50,000
---------------------------------------
Balance as at 12-31-02 4,000,000 $4,000 $49,000 $53,000
=======================================
F-8
Note 6 CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
On August 12, 2000, Robert Gardner, an officer and director, loaned the company
$75,000, repayable on 12 August 2001 at an interest rate of 15% per annum, at
the option of the holder. The terms of the loans payable provide that if payment
is not made within 30 days of the due date, then liquidation damages equal to 5%
of the overdue amount will be added to the balance owing. The interest to and
including 21 December 2002 and the liquidation damages have been waived by Mr.
Gardner and the loan repayment has been extended indefinitely, with a provision
that the note cannot be demanded.
The company is currently using the business offices of Robert Gardner, an
officer and director, at 999 West Hastings Street, Suite 530, Vancouver, B.C.,
Canada, on a rent-free basis. There is no written lease agreement or other
material terms or arrangements relating to the company's agreement with Mr.
Gardner to use his office space. The premises consist of approximately 1000
square feet, including office space, reception area and meeting facilities.
The officers and directors of the company are involved in other business
activities, and may, in the future become active in additional other business
activities. If a specific business opportunity becomes available, such persons
may face a conflict in selecting between the company and their own business
interests. The company has not formulated a policy for the resolution of such a
conflict.
Note 7 INCOME TAXES
Income taxes on the loss has not been reflected in these financial statements as
it is not virtually certain that this loss will be recovered before the expiry
period of the loss carry forwards.
Note 8 LOSS PER SHARE
Basic loss per share is computed by dividing losses available to common
stockholders by the weighted average number of common shares during the period.
Diluted loss per share is calculated on the weighted average number of common
shares that would have resulted if dilutive common stock equivalents had been
converted to common stock. No stock options or similar rights were available or
granted during the period presented. Accordingly, basic and diluted loss per
share are the same.
F-9
PARKER & CO., CHARTERED ACCOUNTANTS
200-2560 Simpson Road
Richmond, B.C. Canada V6X 2P9
Tel: (604) 276-9920 Fax: (604) 276-2415
March 28, 2003
U.S. Securities and Exchange Commission
Washington, D.C. U.S.A. 20549
Reference: eXmailit.com
Audited Financial Statements
For the Years Ended 31 December 2002 and 2001
Dear Sirs:
We refer to the US Securities and Exchange Commissions Form 10-KSB, Annual
Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
for eXmailit.com dated 31 December 2002.
We consent to the use in the above mentioned Form of our report dated 21 March
2003 to the stockholders' of eXmailit.com on the following financial statements:
Statement of financial position as at 31 December 2002 and 2001;
Statements of results of operations and cash flows for the years ended 31
December 2002 and 2001; and Statement of changes in stockholders' equity
from inception, 6 April 2000 to 31 December 2002.
We report that we have read the Form 10-KSB for submission to the US Securities
and Exchange Commission and have no reason to believe that there are any
misrepresentations in the information contained therein that is derived from the
financial statements which we have reported on or that is within our knowledge
as a result of our audit of such financial statements.
This letter is provided to the US Securities and Exchange Commission to which it
is addressed pursuant to the requirements of the Securities Exchange Act of 1934
and not for any other purpose.
Yours truly
/s/ Parker & Co.
- ------------------------
Chartered Accountants
F-10
eXmailit.com
A DEVELOPMENT STAGE COMPANY
INTERIM STATEMENT OF FINANCIAL POSITION
Unaudited - see the Review Engagement Report
- --------------------------------------------------------------------------------
AS AT AS AT
JUNE 30 31 DECEMBER
2003 2002
----------- ----------
CURRENT ASSETS
Cash $ 12,539 $ 19,295
----------- ----------
Total current assets 12,539 19,295
----------- ----------
EQUIPMENT AND SOFTWARE, NOTE 3
Office and computer equipment
and software, at cost 14,560 14,560
Accumulated amortization 7,238 6,557
----------- ----------
Unamortized cost 7,332 8,003
----------- ----------
----------- ----------
TOTAL ASSETS $ 19,861 $ 27,298
=========== ==========
CURRENT LIABILITIES
Accounts payable $ 1,901 $ 2,250
Loans payable, Note 4 75,000 75,000
----------- ----------
Total current liabilities 76,901 77,250
----------- ----------
STOCKHOLDERS' EQUITY (DEFICIENCY IN ASSETS)
Share capital, Note 5 4,000 4,000
Additional paid in capital 49,000 49,000
Currency translation adjustment 3,639 1,691
----------- ----------
Total stockholders'equity (deficiency in assets) (57,040) (49,952)
----------- ----------
----------- ----------
TOTAL LIABILITIES AND DEFICIENCY IN ASSETS $ 19,861 $ 27,298
=========== ===========
- -----------------------------------------------------------------------
Parker & Co., Chartered Accountants
F-11
eXmailit.com
A DEVELOPMENT STAGE COMPANY
INTERIM STATEMENT OF RESULTS OF OPERATIONS
Unaudited - see the Review Engagement Report
- --------------------------------------------------------------------------------
FROM
FOR THE THREE FOR THE SIX INCEPTION,
MONTHS ENDED MONTHS ENDED 6 APRIL, 2000
-------------------------------------- TO 30 JUNE
30 JUNE 30 JUNE 30 JUNE 30 JUNE 2003
2003 2002 2003 2002
--------- --------- --------- -------- ---------
EXPENSES
Accounting, legal and
professional fees $ 4,231 $ 3,860 $ 7,492 $ 7,196 $66,508
Advertising - - - - 647
Bank charges and interest 108 58 152 87 956
Dues and subscriptions - - - 75 1,816
Telephone 61 356 201 721 4,611
Utilities - - - - 153
Rent - - - - 7,445
Postage and courier 88 - 187 53 645
Office supplies - 75 - 165 3,397
Filing and registration fees 193 3,753 333 3,753 4,159
Travel and entertainment - - - - 7,621
Amortization 406 2,047 681 2,787 11,950
Exchange losses - 167 - 1,141 4,335
---------- --------- --------- -------- ---------
Total expenses 5,087 10,316 9,046 15,978 114,243
---------- --------- --------- -------- ---------
OTHER INCOME
Interest earned - - - - 554
Exchange gain - - 10 - 10
---------- --------- --------- -------- ----------
Total Other Income - - 10 - 564
---------- --------- --------- -------- ----------
LOSS BEFORE INCOME TAXES (5,087) (10,316) (9,036) (15,978) (113,679)
INCOME TAXES, NOTE 7 - - - - -
---------- --------- --------- -------- ----------
LOSS ($5,087) ($10,316) ($9,036) ($15,978)($113,679)
========== ========= ========= ========= =========
LOSS PER SHARE, NOTE 8 ($0.00) ($0.00) ($0.00) ($0.00) ($0.03)
========== ========= ========= ========= =========
WEIGHTED AVERAGE NUMBER
OF SHARES 4,000,000 4,000,000 4,000,000 4,000,000 3,552,700
========== ========= ========= ========= =========
- -----------------------------------------------------------------------------
Parker & Co., Chartered Accountants
F-12
eXmailit.com
A DEVELOPMENT STAGE COMPANY
INTERIM STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
FOR THE THREE MONTHS AND SIX MONTHS ENDED 30 JUNE 2003 AND 2002 AND
FROM INCEPTION, 6 APRIL 2000 TO 30 JUNE 2003
Unaudited - See the Review Engagement Report
- --------------------------------------------------------------------------------
COMMON COMMON ADDITIONAL CURRENCY
STOCK STOCK PAID IN TRANSLATION
CONSIDERATION ISSUED AMOUNT CAPITAL DEFICIT ADJUSTMENT TOTAL
- --------------------------------------------------------------------------------
Private placement
for cash on
10 April 2000 3,000,000 $ 3,000 $ 0 $ 3,000
Net loss from
inception, 6 April
2000 to 31 December
2000 ($28,224) (28,224)
--------- --------- --------- --------- ---------- -------
Balance as at
31 December 2000 3,000,000 3,000 - (28,224) - (25,224)
Private placement
for cash on
20 September 2001 1,000,000 1,000 49,000 50,000
Net loss for the
year ended
31 December 2001 (46,241) (46,241)
--------- --------- --------- --------- --------- -------
Balance as at 31
December 2001 4,000,000 4,000 49,000 (74(21,465) -
--------- --------- --------- --------- --------- -------
Net loss for the
year ended
December 31, 2002 (30,178) (30,178)
Currency translation
adjustment change
for the year ended
31 December 2002 1,691 1,691
--------- --------- --------- --------- ---------- ------
Balance as at
31 December 2002 4,000,000 4,000 49,000 (104,643) 1,691 (49,952)
Net loss for the
six month ended
30 June 2003 (9,036) (9,036)
Currency translation
adjustment change
for the six months ended
30 June 2003 1,948 1,948
--------- --------- --------- --------- ---------- ------
Balance as at
30 June 2003 4,000,000 $4,000 $49,000 ($113,679) $3,639 ($57,040)
========== ========= ========= ========== ========= =======
- -----------------------------------------------------------------------------
Parker & Co., Chartered Accountants
F-13
eXmailit.com
A DEVELOPMENT STAGE COMPANY
INTERIM STATEMENT OF CASH FLOWS
Unaudited - see the Review Engagement Report
- -----------------------------------------------------------------------------
FROM
FOR THE THREE FOR THE SIX INCEPTION,
MONTHS ENDED MONTHS ENDED 6 APRIL 2000
-------------------- ---------------- TO 30 JUNE
30 JUNE 30 JUNE 30 JUNE 30 JUNE 2003
2003 2002 2003 2002
--------- --------- -------- --------- --------
CASH PROVIDED (USED)
FROM OPERATIONS
Net loss ($5,087) ($10,316) ($9,036) ($15,978)($113,679)
Items not involving cash
Amortization of equipment
and software cost 406 2,047 681 2,787 11,950
Office equipment exchanged
for consulting services - - - - 15,354
--------- -------- --------- --------- --------
Total cash used for the loss (4,681) (8,269) (8,355) (13,191) (86,375)
Changes in working capital
other than cash
Accounts payable (417) (523) (349) (548) 1,901
Loan payable - - - - 75,000
--------- -------- --------- --------- --------
Total changes in
working capital (417) (523) (349) (548) 76,901
--------- -------- --------- --------- --------
Total cash used in operations (5,098) (8,792) (8,704) (13,739) (9,474)
--------- -------- --------- --------- --------
CASH PROVIDED (USED) BY
INVESTMENT ACTIVITY
Acquisition of equipment
and software - (2,830) - (2,830) (34,626)
--------- -------- --------- --------- --------
CASH PROVIDED (USED) BY
FINANCING ACTIVITY
Issue of common stock - - - - 53,000
Currency translation adjustment 1,090 2,448 1,948 2,448 3,639
--------- -------- --------- --------- --------
Total cash provided
by financing 1,090 2,448 1,948 2,448 56,639
--------- -------- --------- --------- --------
CASH CHANGE (4,008) (9,174) (6,756) (14,121) 12,539
CASH BEGINNING 16,547 41,666 19,295 46,613 -
--------- -------- --------- --------- --------
CASH ENDING $ 12,539 $ 32,492 $ 12,539 $ 32,492 $ 12,539
========= ======== ========= ========= ========
COMPRISED OF:
Cash $ 12,539 $ 32,492 $ 12,539 $ 32,492 $ 12,539
========= ======== ========= ========= ========
- -----------------------------------------------------------------------------
Parker & Co., Chartered Accountants
F-14
A DEVELOPMENT STAGE COMPANY
NOTES TO THE INTERIM FINANCIAL STATEMENTS
FOR THE THREE MONTHS AND SIX MONTHS ENDED 30 JUNE 2003 AND FROM INCEPTION, 6
APRIL 2000 TO 30 JUNE 2003 Unaudited - see the Review Engagement Report
- --------------------------------------------------------------------------------
Note 1 THE CORPORATION AND ITS BUSINESS
eXmailit.com was incorporated in the State of Nevada, United States on 6 April
2000. The company has a total of 100,000,000 authorized shares with a par value
of $0.001 per share with 4,000,000 shares issued and outstanding as at 3O June
2003.
The company has offices in Vancouver, British Columbia, Canada. The company has
been organized to operate an online email to mail service network on the
internet. The company is a development stage company which has not derived any
revenue from its operations. The fiscal year end of the company is 31 December.
Note 2 SUMMARY OF SIGNIFICANT ACCOUNTING PRINCIPLES
These financial statements have been prepared using United States Generally
Accepted Accounting Principles as established by the American Institute of
Certified Public Accountants and have been stated in United States dollars
rounded to the nearest whole dollar except for the loss per share which has been
rounded to the nearest cent. These accounting principles are applicable to a
going concern, which contemplates the realization and liquidation of liabilities
in the normal course of business. Current business activities have just begun
and insufficient revenue has been generated to sustain the company as a going
concern without the infusion of additional capital.
Assets and liabilities of operations in foreign countries are translated into
United States dollars using the exchange rate at the statement of financial
position date for monetory assets and liabilities or the historical exchange
rates for the nonmonetory assets. Accordingly, the company's primary functional
currency is the Canadian dollar and as a result the company operates a Canadian
dollar bank account which was translated into United States of America dollars
at the exchange rate at the statement of financial position date. Transactions
made in Canadian dollars or other foreign currencies were translated at the
average exchange rates prevailing throughout the year. The effects of exchange
rate fluctuations on translating foreign currency assets and liabilities into
United States dollars are included in stockholders' equity, while gains and
losses resulting from foreign currency transactions are included in operations.
Revenue is recorded as a sale at the time the services contracted for have been
completed. Costs are recorded at the time an obligation to pay occurs and are
expensed at the time the benefit to the company is matched to revenue or, if
there is no matching revenue, to the period in which the benefit is realized.
Equipment and software are all amortized at 20% on the declining balance.
F-15
Note 3 EQUIPMENT AND COMPUTER SOFTWARE
ACCUMULATED UNAMORTIZED UNAMORTIZED
AT COST AMORTIZATION COST COST
30 JUNE 30 JUNE 30 JUNE 31 DECEMBER
COMPRISED OF: 2003 2003 2003 2002
----------------------------------------------------
Office furniture $1,982 $ 902 $ 1,080 $ 1,174
computer equipment 2,828 2,147 681 783
Computer software 5,616 2,371 3,245 3,528
Leasehold improvements 4,134 1,818 2,316 2,518
------ ------- ------- -------
$14,560 $7,238 $ 7,322 $ 8,003
======= ======= ======= =======
Note 4 LOANS PAYABLE
The loans payable were repayable on August 12, 2001. Interest at the rate of 15%
per annum may be charged after the loans maturity at the option of the holder.
If payment is not paid within 30 days of the due date, then liquidation damages
equal to 5% of the overdue amount will be added to the balance owing. The
interest to 30 June 2003 and the liquidation damages have been waived and the
loans repayment terms have been extended indefinitely, with a provision that the
notes cannot be demanded.
NOTE 5 SHARE CAPITAL
The authorized share capital is 100,000,000 shares with a par value of $0.001.
4,000,000 common share have been issued as follows:
ADDITIONAL
SHARE PAID IN
CONSIDERATION DATE ISSUED CAPITAL CAPITAL
TOTAL
- ---------------------------------------------------------------------------
Private placement
for cash 10 April 2000 3,000,000 $3,000 $ 0 $ 3,000
Private placement
for cash 20 September 2001 1,000,000 1,000 49,000 50,000
--------- ------ ------ -------
Balance as at 30 June 2003 4,000,000 $4,000 $49,000 $53,000
========= ====== ======= =======
F-16
eXmailit.com
A DEVELOPMENT STAGE COMPANY
NOTES TO THE INTERIM FINANCIAL STATEMENTS
FOR THE THREE MONTHS AND SIX MONTHS ENDED 30 JUNE 2003 AND FROM INCEPTION, 6
APRIL 2000 TO 30 JUNE 2003 Unaudited - see the Review Engagement Report
- -------------------------------------------------------------------------
Note 6 CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
On 12 August 2000, Robert Gardner, an officer and director, loaned the company
$75,000, repayable on 12 August 2001 at an interest rate of 15% per annum, at
the option of the holder. The terms of the loan payable provide that if payment
is not made within 30 days of the due date, then liquidation damages equal to 5%
of the overdue amount will be added to the balance owing. The interest to and
including 30 September 2002 and the liquidation damages have been waived by Mr.
Gardner and the loan repayment has been extended indefinitely, with a provision
that the note cannot be demanded.
The company is currently using the business offices of Robert Gardner, an
officer and director, at 999 West Hastings Street, Suite 530, Vancouver, B.C.
Canada, on a rent-free basis. There is no written lease agreement or other
material terms or arrangements relating to the company's agreement with Mr.
Gardner to use his office space. The premises consist of approximately 1000
square feet, including office space, reception area and meeting facilities.
The officers and directors of the company are involved in other business
activities, and may, in the future become active in additional other business
activities. If a specific business opportunity becomes available, such persons
may face a conflict in selecting between the company and their own business
interests. The company has not formulated a policy for the resolution of such a
conflict.
Note 7 INCOME TAXES
Income taxes on the loss has not been reflected in these financial statements as
it is not virtually certain that this loss will be recovered before the expiry
period of the loss carry forwards.
Note 8 LOSS PER SHARE
Basic loss per share is computed by dividing losses available to common
stockholders by the weighted average number of common shares during the period.
Diluted loss per share is calculated on the weighted average number of common
shares that would have resulted if dilutive common stock equivalents had been
converted to common stock. No stock options or similar rights were available or
granted during the period presented. Accordingly, basic and diluted loss per
share are the same.
F-17
EXMAILIT.COM
1999 South Bascom Avenue, Suite 700
Campbell, California 95008
***PROXY***
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Nicholas Miller as Proxy Holder, with full power
of substitution and revocation, the true and lawful attorney and proxy of the
undersigned at the Annual Meeting of shareholders (the "Meeting") of the Company
to be held Monday, September 29, 2003 at 1:00 p.m. (PST), at ___________________
_______________________,Vancouver, British Columbia, Canada, or any adjournments
thereof, to vote the shares of Common Stock of the Company standing in the name
of the undersigned on the books of the Company, or such shares of Common Stock
of the Company as the undersigned may otherwise be entitled to vote on the
record date for Meeting with all powers the undersigned would possess if
personally present at the Meeting, with respect to the matters set forth below
and described in the Notice of the Annual Meeting of shareholders dated
September ____, 2003, and the accompanying Proxy Statement of the Company.
1. Election of the Board of Directors until the next Annual Meeting.
For the nominee Against the nominee Abstain
1. Nicholas Miller [ ] [ ] [ ]
2. Ratification of the employment of KPMG, LLP as the Company's independent
auditor for the fiscal year ending December 31, 2003.
For [ ] Against [ ] Abstain [ ]
3. Approval of an amendment to the Company's articles of incorporation to
change the Company's name to Cirond Corporation.
For [ ] Against [ ] Abstain [ ]
4. Approval of an amendment to the Company's articles of incorporation to
create a class of 25,000,000 shares of preferred stock.
For [ ] Against [ ] Abstain [ ]
5. Ratification of a 16-for-1 forward stock split of the Company's issued and
outstanding common stock.
For [ ] Against [ ] Abstain [ ]
6. Ratification of a bylaw amendment changing the quorum requirement for
shareholder's to transact business.
For [ ] Against [ ] Abstain [ ]
7. Any other business as may properly come before the meeting or any adjournment
thereof.
For [ ] Against [ ] Abstain [ ]
8. Mark "FOR" to enroll this account to receive certain future shareholder
communications in a single package per household. Mark "AGAINST" if you do
not want to participate. To change your election in the future, call
(604) 688-4060.
For [ ] Against [ ]
In His Discretion, the Proxy Holder Is Authorized to Vote upon Such Other
Business That May Properly Come Before the Meeting.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR ALL PROPOSALS LISTED. IF NO
DIRECTIONS ARE GIVEN BY THE PERSON(S) EXECUTING THIS PROXY, THE SHARES WILL BE
VOTED IN FAVOR OF ALL LISTED PROPOSALS. THIS PROXY WHEN PROPERLY EXECUTED WILL
BE VOTED IN THE MANNER DIRECTED HEREIN BY THE UNDERSIGNED STOCKHOLDER, AND
UNLESS OTHERWISE SPECIFIED, THE SHARES WILL BE VOTED FOR ALL PROPOSALS.
Please sign below exactly as your name appears on your certificate. When shares
are held by joint tenants, both should sign. When signing as attorney, executor,
administrator, trustee or guardian, please give full title as such and submit
powers of attorney or other appropriate document. If a corporation, please sign
in full corporate name by President or other authorized officer. If a
partnership, please sign in partnership name by authorized person.
Dated , 2003
-----------------------
- ------------------------------------ ----------------------
Please Print or Type Your Signature Number of Shares Voted
PLEASE MARK, SIGN, DATE, AND RETURN THIS PROXY PROMPTLY TO THE ADDRESSEE IN THE
ENCLOSED STAMPED ENVELOPE. If you have had a change of Address, please print or
type your new address(s) in the space below:
12
EXMAILIT.COM
1999 South Bascom Avenue, Suite 700
Campbell, California 95008
Telephone: (604) 688-4060
Consent to Electronic Delivery of Corporate Information to Shareholders
For your convenience, we are now offering you, as an eXmailit.com ("Exmail")
shareholder, the option of viewing future Exmail corporate information,
including Annual Reports and Proxy Statements, on the Internet. You can access
them at your convenience and easily print them if you wish. The best part is
that you would receive the information earlier than ever before.
Please note that this is a global consent to receive all corporate information
of Exmail, and that you must register below to use this new service. Also please
note that consenting to this service could subject you to costs associated with
accessing the Internet, such as usage charges from Internet access providers and
telephone companies.
If your Exmail stock is held directly with a broker, please contact ADP Investor
Communication Services at http://www.icsdelivery.com/live/, which will handle
your request for electronic delivery of corporate information.
If your Exmail stock is held directly with Exmail and you are a registered
shareholder, please continue below.
If you would like to receive future corporate information via Exmail's web site,
http://www.exmailit.com, rather than receiving hard copies in the mail, please
enter your name and Tax Payer ID # or Social Security # below:
Tax Payer ID# or Social Security #:__________________________
Name(s) on Account: _____________________________________
REGISTRATION FOR ELECTRONIC DELIVERY
I (we) consent to use Exmail's Internet site to receive all future corporate
information, including but not limited to, Annual Reports and Proxy Statements
as they become available. I understand that this consent will remain in effect
until I notify Exmail by mail that I wish to resume mail delivery of corporate
documents.
By signing below and returning this card to Exmail at the address listed herein,
I agree with the above.
Date:____________________ ________________________________________
Signature
E-MAIL ALERT SERVICE
We are also offering you the opportunity to enroll to receive messages (alerts)
delivered to your e-mail address directly from the Exmail Investor Relations
staff. You may receive notification from us periodically alerting you to some
updated information on our website. Please fill in your name and e-mail address
below:
Your name:___________________________________________
E-mail address:________________________________________
You may revoke this consent to receive electronic delivery of Exmail's corporate
information at any time. To resume mail delivery or to unsubscribe from the
e-mail alert service, please write to:
EXMAILIT.COM
1999 South Bascom Avenue, Suite 700
Campbell, California 95008
Telephone: (604) 688-4060
13