SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549Schedule 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 (Amendment No. ___))
Filed by the Registrant [ ][_]
Filed by a Party other than the Registrant [X][_]
Check the appropriate box:
[X] Preliminary Proxy Statement
[ ][_] Confidential, forFor Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
[ ][_] Definitive Proxy Statement
[ ][_] Definitive Additional Materials
[ ][_] Soliciting Material Pursuant to Section 240.14(a)-12Under Rule 14a-12
SALES ONLINE DIRECT, INC.
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(Name of Registrant asAs Specified In Its Charter)
Gregory Rotman and Richard Rotman,
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(Name of Person(s) Filing Proxy Statement,
if other thanOther Than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required
[ ]required.
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(1)(l) and 0-11.0-11
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set(set forth in the amount on which the
filing fee is calculated and state how it was determined):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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[_] Fee paid previously with preliminary materials.
[ ][_] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11 (a)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 Formform or Scheduleschedule and the date of its filing.
(1) Amount Previously Paid:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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PRELIMINARY PROXY STATEMENT
GREGORY ROTMAN
RICHARD ROTMAN
725 SOUTHBRIDGE STREET
WORCESTER, MASSACHUSETTSPreliminary Copy
SALES ONLINE DIRECT, Inc.
4 Brussels Street
Worcester, Massachusetts 01610
* * *
PROXY STATEMENT IN SUPPORTSOLICITATION OF CONSENTS
TO THE ROTMAN GROUP'S
NOMINEES FOR ELECTION AS DIRECTORSSTOCKHOLDERS OF SALES ONLINE DIRECT, INC.
2000 SPECIAL MEETING IN LIEU OF ANNUAL MEETING OF STOCKHOLDERS
INTRODUCTION
This Proxy Statement and the accompanying [BLUE] proxy card are being
furnished in connection with the solicitation:
The Board of proxies by Gregory Rotman and
Richard Rotman (the "Rotman Group") for use at the 2000 Special Meeting In Lieu
of Annual Meeting of StockholdersDirectors of Sales OnLineOnline Direct, Inc. (the "Company")
scheduled for September 7, 2000 at 10:00 a.m. atrequests your consent in writing, without a meeting, to a Charter Amendment to
the officesCompany's Certificate of Incorporation, as amended, to increase the number
of authorized shares of common stock from 100,000,000 to 350,000,000.
The attached Consent Solicitation Statement describes the matter being
presented to the stockholders in this consent solicitation. Because this
solicitation of written consents is in lieu of a meeting of stockholders there
will be no meeting of stockholders held in connection with this consent
solicitation. The attached Consent Solicitation Statement is provided to you
pursuant to Rule 14a-3 under the Securities Exchange Act of 1934. We encourage
you to read the Consent Solicitation Statement thoroughly.
YOUR BOARD HAS UNANIMOUSLY APPROVED AND UNANIMOUSLY RECOMMENDS THAT YOU
CONSENT TO THE INCREASE IN THE AUTHORIZED NUMBER OF SHARES OF COMMON STOCK.
Only holders of record of common stock of the Company as of the close of
business on November 6, 2001 (the "Record Date") are entitled to receive the
accompanying Consent Solicitation Statement and consent and to consent to the
Charter Amendment. Each stockholder is urged to sign, date and mail the
accompanying consent as promptly as possible in the enclosed self-addressed
envelope to Sales Online Direct, Inc., 4 Brussels Street, Worcester, MA 01610.
BY ORDER OF THE BOARD OF DIRECTORS,
Gregory Rotman
President
November ___, 2001
Worcester, Massachusetts
YOUR CONSENT IS IMPORTANT TO US
IT IS IMPORTANT THAT YOUR SHARES BE REPRESENTED REGARDLESS OF THE NUMBER OF
SHARES YOU OWN. TO ENSURE YOUR CONSENT BEING COUNTED, YOU ARE REQUESTED TO
COMPLETE, SIGN AND DATE THE ENCLOSED CONSENT AS PROMPTLY AS POSSIBLE AND MAIL IT
IN THE ENCLOSED ENVELOPE. ANY CONSENT GIVEN MAY BE REVOKED BY YOU IN WRITING AT
ANY TIME PRIOR TO THE RECEIPT BY THE COMPANY OF UNREVOKED CONSENTS FROM THE
HOLDERS OF A MAJORITY OF THE COMPANY'S COMMON STOCK. IF YOU HAVE ANY QUESTIONS
ABOUT THIS CONSENT SOLITICATION OR ABOUT PROVIDING YOUR CONSENT, PLEASE CONTACT
__________________, ___________________, AT (508) 791-6710.
Preliminary Copy
THIS CONSENT SOLICITATION STATEMENT IS BEING PROVIDED TO YOU BY THE
MANAGEMENT OF THE COMPANY
SALES ONLINE DIRECT, Inc.
4 Brussels Street
Worcester, Massachusetts 01610
CONSENT SOLICITATION STATEMENT
The Board of Directors of Sales Online Direct, Inc. (the "Company") hereby
requests consent from the holders of the Company's common stock. Please indicate
your consent by SIGNING, DATING and MAILING the enclosed consent ("Consent") to
the Company, 4 Brussels Street, Suite 220, Worcester, Massachusetts 01601, or any adjournment
or postponement thereof (the "Meeting") which has been called to elect the
Company's Board of Directors.MA 01610.
This ProxyConsent Solicitation Statement and the [BLUE] proxy cardaccompanying form of Consent
are first being sent to shareholders of the Companymailed on or about August 7, 2000. The
Company'sNovember ___, 2001 to holders of record of
common stock as of the close of business on November 6, 2001 (the "Record
Date").
Requests for information regarding this Consent Solicitation Statement may
be directed to the attention of ________________, __________, at (508) 791-6710
or delivered in writing to the Company at its principal executive offices areoffice located
at 4 Brussels Street, Suite
220, Worcester, MassachusettsMA 01610.
The record dateBoard of Directors of the Company has proposed an amendment to Article
FOURTH of the Company's Certificate of Incorporation, as amended ("Certificate
of Incorporation"), to increase the authorized common stock of the Company from
100,000,000 to 350,000,000 shares (the "Record Date""Charter Amendment"). See "Amendment to
Certificate of Incorporation to Increase Authorized Common Stock."
The Delaware General Corporation Law ("DGCL") for determiningrequires that amendments to a
corporation's certificate of incorporation be approved by stockholders entitled
to noticevote thereon, as well as by the Board of Directors. Accordingly, the Company
is hereby soliciting consent from the holders of its common stock to the Charter
Amendment. The Charter Amendment requires the consent of persons holding not
less than a majority of the issued and to vote at,outstanding common stock on the Meeting is August 1, 2000.Record
Date.
SOLICITATION, VOTING AND REVOCABILITY OF CONSENTS
As of the Record Date, there were outstanding [47,056,140]_____________ shares of Common Stock, par value
$.001 per share of the Company.
As of the Record Date, members of the Rotman Groupcommon stock were issued and
other participants
in the Rotman Group's solicitation, beneficially own, in the aggregate,
18,614,031 shares or 39.4% of the Company's outstanding Common Stock and are
seeking your vote at the
Meeting for the election of John Martin, Andrew Pilaro, Gregory Rotman and
Richard Rotman (the "Nominees") as Directors of the Company for a term expiring
at the 2001 Annual Meeting of Stockholders and until their successors are
elected and qualified. Each of the members of the Rotman Group intends to vote
his shares of Common Stock for the election of the Nominees. Certain additional
information concerning the members of the Rotman Group and other participants in
the Rotman Group's solicitation is set forth elsewhere in this Proxy Statement.
VOTING AND REVOCATION OF PROXIES
Holdersoutstanding. Only holders of record of common stock as of the Company's Common Stockclose of business
on the Record Date are entitled to consent to the Charter Amendment. Each share
of common stock is entitled to one vote per sharevote. The shares of common stock for which
properly executed Consents in the electionaccompanying form are received will, if no
contrary instruction is received, be deemed submitted FOR the Charter Amendment.
SECTION 228(c) OF THE DGCL REQUIRES THAT EACH CONSENT HAVE A DATED
SIGNATURE OF EACH STOCKHOLDER WHO SIGNS THE CONSENT. AN UNDATED CONSENT CANNOT
BE USED. In addition, under DGCL Section 228(c), none of the Consents will be
effective to approve the Charter Amendment unless Consents from holders of
record on the Record Date owning the minimum number of shares required to
approve such proposal have been received within the 60-day period following the
first dated Consent which is received with respect to such proposal (the
"Consent Solicitation Period"). The Consent provided may be executed by the
record holder or pursuant to authority given by the written proxy of any record
holder.
Preliminary Copy
Any Consent given pursuant to this solicitation is considered revocable by
the person giving it at any time before it is used by the Company. If, prior to
the earlier of the date on which the Company has received Consents from persons
holding the minimum number of shares of common stock required to approve the
Charter Amendment or the end of the Consent Solicitation Period, the Company
receives a written notice of revocation of a Consent or receives a duly executed
Consent bearing a later date, any earlier dated consent will be revoked. If the
holders of a majority of the outstanding common stock as of the Record Date
approve the Charter Amendment, the Company intends to promptly amend the
Certificate of Incorporation in conformity thereto and file a certificate of
amendment ("Certificate of Amendment") with the Delaware Secretary of State. The
Company shall also promptly notify the stockholders who have not consented to
the action taken as required by Delaware law.
The Company will bear the cost of the solicitation of Consents by the Board
of Directors. The Company may use the services of its executive officers and
directors to solicit consents from stockholders in person and by mail, telephone
and facsimile. Arrangements may also be made with brokers, fiduciaries,
custodians and nominees to send Consents, Consent Solicitation Statements and
other material to the beneficial owners of the Company's common stock held of
record by such persons, and the Company may reimburse them for reasonable
out-of-pocket expenses incurred by them in so doing.
AMENDMENT TO CERTIFICATE OF INCORPORATION TO
INCREASE AUTHORIZED COMMON STOCK
The Company is currently authorized to issue 100,000,000 shares of Common
Stock, of which ____________ shares are issued and outstanding. The Board of
Directors believes that it is in the best interests of the Company and its
stockholders to increase the authorized Common Stock to 350,000,000 shares. This
Charter Amendment has been unanimously adopted by the Board of Directors.
Neither the par value of the Common Stock nor any rights presently accruing to
holders of Common Stock will be affected by this increase. The Board of
Directors reserves the right, notwithstanding stockholder approval and without
further action by the stockholders, not to proceed with the increase of the
authorized capital stock of the Company if, at any time prior to filing the
Meeting.
The presence,amendment with the Secretary of State of Delaware, the Board of Directors, in
person or by proxy,its sole discretion, determines that the increase in the authorized capital
stock of the Company is no longer in the best interests of the Company and its
stockholders.
Vote Required; Manner of Approval; Appraisal Rights
Approval to increase the authorized capital stock under the DGCL requires
the affirmative vote of the holders of a majority of the outstanding shares of
voting stock of the Company. The Company has no class of voting stock
outstanding other than the Common Stock authorizedStock.
Section 228 of the DGCL provides generally that, unless the Company's
certificate of incorporation provides otherwise, stockholders may take action
without a meeting of stockholders and without prior notice if a consent or
consents, setting forth in writing the action so taken, is signed by the holders
of outstanding voting stock holding not less than the minimum number of votes
that would be necessary to vote will constituteapprove such action at a quorum
formeeting of stockholders.
Under the transactionapplicable provisions of business at the Meeting. AbstentionsDGCL, this action is effective when
written consents from holders of record of a majority of the outstanding shares
of voting stock are signed and delivered to the Company. Withholding of consent,
abstentions, and broker non-votes all have the effect of a vote against the
Charter Amendment.
The Charter Amendment will become effective upon its filing with the
Secretary of State of Delaware. The form of Charter Amendment is attached as
Appendix A hereto and is incorporated by
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Preliminary Copy
reference herein, which form is, however, subject to change as may be necessary
or required by the Delaware Secretary of State.
Under DGCL Section 262, stockholders are not entitled to appraisal rights,
whether or not stockholders consent to the Charter Amendment.
Reasons for Increase in Authorized Capital Stock
The Board of Directors considers the proposed increase to be in the best
interests of the Company and its stockholders. The proposed increase ensures
that a sufficient number of shares of common stock will be counted in determining whether a quorum is present at the Meeting.
Directors are elected by a pluralityavailable for future
transactions, including acquisitions, stock splits, stock dividends, employee
benefit plans, stock bonus and award plans, satisfaction of the votes of the shares present in
person or represented by proxy at the Meetingdebt, and entitled to vote on the
election of directors and abstentions have no effect.
The Rotman Group is not aware of any matter other
than the election of
Directors at the Meeting. Should any other business properly come before the
Meeting, the Rotman Group's [BLUE] proxy card confers upon the Rotman Group's
proxy holders discretionary authority to vote in respect to any such business in
accordance with their judgment.
Execution and delivery of a proxy card will not effect a stockholder's
right to attend the Meeting and vote in person. A stockholder in whose name the
shares are registered asgeneral corporate purposes. As of the Record Date, the Company has ___________
shares of common stock issued and whooutstanding, and an additional ____________
shares reserved for issuance, for a total of ___________ shares of common stock
either issued and outstanding or reserved for issuance. Therefore, only ______
of the 100,000,000 shares of Common Stock are available for new issuances.
The Company has giventhree debt obligations in which the issuance or reservation
of additional shares of common stock will be necessary. On March 23, 2000, the
Company issued an 8% convertible note to Augustine Fund, L.P., in the principal
amount of $3,000,000 pursuant to a proxySecurities Purchase Agreement. On November
__, 2001, the Company issued a second 8% convertible note to Augustine Fund,
L.P., in the principal amount of $1,000,000 pursuant to a Loan Agreement. On
November ___, 2001, the Company issued a 6% convertible note in the principal
amount of $1,000,000 to Leslie Rotman, the sole stockholder of Rotman
Collectibles, Inc., as part of the merger of Rotman Collectibles into a Company
subsidiary. Rotman Collectibles is in the business of buying and selling movie
poster memorabilia.
The Augustine Fund notes are convertible into common stock at a conversion
price equal to 73% of the average of the closing bid price of the common stock
for five days immediately preceding the conversion date. The Rotman note is
convertible into common stock at a conversion price equal to 80% of the average
of the closing bid price of the common stock for five days immediately preceding
the conversion date. The number of shares received upon conversion may revokebe
adjusted in the event of a stock split, stock dividend, reorganization, merger,
consolidation, or sale of the Company's assets and other similar transactions.
For each of the three notes, the Company has agreed to file with the SEC a
registration statement for the resale of the shares issuable upon conversion of
the convertible notes and the payment of interest on the convertible notes. The
Company has already registered 19,692,792 shares of common stock with respect to
the first Augustine Fund note. An additional registration statement with respect
to the first Augustine Fund note, and with respect to the other two notes, will
be required. The Company's failure to register the shares in the time specified
in agreements with the respective note holders would result in a further
discount in the conversion price of the common stock under the notes, to as low
as 50% for the second Augustine Fund note, and 70% for the Rotman note, each
based on the average of the closing bid price of the common stock for five days
immediately preceding the conversion date.
The convertible notes include a restriction that they are convertible by
any holder only to the extent that the number of shares issuable, together with
the number of shares of common stock owned by such holder, but not including
unconverted portions of the convertible note or unexercisable or warrants, would
not exceed 4.99% of the then outstanding shares of the Company's common stock as
determined in accordance with Section 13(d) of the Securities Exchange Act of
1934. This 4.99% limit may not prevent any holder from converting all of the
convertible note, because the holder can convert the convertible note
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Preliminary Copy
into 4.99% of the Company's outstanding common stock, then to the extent it
liquidates some or all of these shares, the holder can convert additional
amounts of the convertible note. As a result, the 4.99% limit does not prevent a
selling stockholder from selling more than 4.99% of the Company's common stock,
while never holding more than 4.99% at any time before it is voted by executingone time.
The number of shares of common stock that may ultimately be issued upon
conversion of the three notes presently cannot be determined and delivering a written
revocationcould
fluctuate. The Company currently does not have enough shares authorized in its
Certificate of Incorporation to satisfy these contractual obligations.
In addition, based on the Rotman Group orCompany's current cash position, the Company will
likely need infusions of additional capital to fund anticipated marketing costs
and operating expenses in the Secretarynext year, and the Company may seek additional
opportunities to purchase additional inventory with common stock. The Company
does not intend to issue its common stock except on terms that the Company deems
to be in the best interests of the Company by
presentationand its stockholders.
Under the Company's Certificate of Incorporation, the Company's
stockholders do not have preemptive rights with respect to the common stock.
Thus, should the board of directors issue additional shares of common stock,
existing stockholders would not have any preferential rights to purchase shares.
Under the DGCL, stockholders are not entitled to dissenter's rights of appraisal
with respect to the Charter Amendment.
Effect of Issuance of Additional Shares on Common Stock
If the Board of Directors elects to issue additional shares of common
stock, the issuance could have a later dated proxy or by attendingdilutive effect on the Meetingearnings per share, book
value per share, voting power and voting by
ballot (which hasshareholdings of current stockholders. The
number of shares of common stock issuable upon conversion of the convertible
notes could have the effect of revokingreducing the prior proxy). AttendanceCompany's stock price, because the
conversion will be inversely proportional to the market price of the common
stock at the Meeting, however, will not in and of itself revoke a proxy.
A shareholder who is a beneficial owner but not a registered owner asdates upon which the holder of the Record Date, cannot vote his or herconvertible note converts the
convertible note. In addition, to the extent that any holder of the convertible
notes converts and then sells common stock in accordance with the 4.99%
limitation, the common stock price may decrease due to the additional shares except by the shareholder's
broker, bank or nominee executing a proxy on his or her behalf.
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Whether or not you plan to attend the Meeting, please sign, mark and date
the enclosed [BLUE] proxy card and return it in
the accompanying envelopemarket, possibly allowing the holder to convert the convertible note into
greater amounts of common stock, further depressing the stock price.
The additional shares issued upon conversion of the convertible notes would
also dilute the percentage interest of the Company's existing common
stockholders, and this dilution would increase as soonmore shares of common stock
are issued due to the impact of the variable conversion price. Each additional
issuance of shares upon conversion would increase the supply of shares in the
market and, as possible. Sign your [BLUE] proxy card exactly as your name appears ona result, may cause the label.
THE ROTMAN GROUP'S NOMINEES
Certain information regardingmarket price of the Nominees, their present principal
occupationsCompany's common
stock to decline. The effect of this increased supply of common stock leading to
a lower market price may be magnified if there are sequential conversions of the
convertible notes into shares of common stock. A holder of a convertible note
could convert a portion of the convertible note and business addresses, their business experience, their ages,then sell the common stock
issued upon conversion, which could result in a drop in the Company's stock
price. If the stock price were to decrease, then a holder could convert the
convertible note at a lower conversion price, and be issued a greater number of
shares of common stock due to the lower conversion price. The increase in the
aggregate number of shares of common stock issued upon conversion of the
convertible note above what it would otherwise be could place significant
downward pressure on the Company's stock price. This downward pressure on the
Company's stock price might encourage market participants to sell the Company's
stock short, which would put further downward pressure on the Company's stock
price. In issuing the additional shares, however, the Company would avoid
repaying in cash the aggregate principal amount of $5,000,000 for the three
notes.
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Preliminary Copy
Potential Anti-Takeover Effect
Although the Company's Board of Directors believes that the proposed change
to the present Certificate of Incorporation is beneficial to stockholders, the
provisions may have the effect of rendering the Company less attractive to
potential hostile acquirors. Therefore, the action may have the effect of
discouraging future takeover attempts from which stockholders may, or may not,
obtain a premium for their shares over current market prices. The provisions
could also render the removal of the incumbent Board of Directors more
difficult. The Board of Directors believes, however, that the potential benefits
outweigh these possible disadvantages.
INTEREST OF CERTAIN PERSONS IN OR IN
OPPOSITION TO MATTERS TO BE ACTED UPON MATTERS
No director, executive officer, associate of any director or executive
officer, or any other person has any substantial interest, direct or indirect,
by security holdings or otherwise, in the proposed Charter Amendment which is
not shared by all other stockholders, except that, the holder of the Rotman note
is Leslie Rotman, who is the mother of Gregory Rotman, the Company's President
and CEO, and a director of the Company, and Richard Rotman, the Company's
Executive Vice President and CFO, and a director of the Company. The Company
believes that the merger transaction related to the issuance of the Rotman note
was on terms that were fair and reasonable to the Company and no less favorable
than could have been obtained by an unaffiliated party.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
To the knowledge of the Company's management, the following table sets
forth the beneficial ownership of Common Stock beneficially owned byas of the Record Date of each of
them as of August 1, 2000 is set forth below. A summary of their
transaction history with respect to the Company's Common Stock duringdirectors and executive officers, and all of the past
two yearsCompany's
directors and executive officers as a group. The address of each person named
below is set forth below under "Certain Information About Nominees".
SHARES OWNED OF
NAME, PRINCIPAL OCCUPATION, RECORD OR PERCENTAGE
BUSINESS ADDRESS AND AGE BUSINESS EXPERIENCES BENEFICIALLY OF CLASS
------------------------ -------------------- ------------ --------
John Martin Since May 1999, Chief Technology 147,875(1) *
Chief Technology Officer of the Officer of the Company. From
Company, ____ 1997 to May 1999,
4 Brussels Street, Worcester, Instructor, Clark University
Massachusetts 01610 Computer Career Institute. From
Age: 35 August 1996 to May 1999, Software
Engineer, Sybase, Inc. (software
development) From prior to 1995
to August 1996, Senior
Programmer, Presidax (manufacture
of barcoded labels)
Andrew Pilaro Since August, 1996, Assistant to 1,700 *
Assistant to Chairman of CAP Chairman of CAP Advisors Limited
Advisers Limited (venture capital fund) with
36 Fitzwilliam Place, Dublin 2, responsibility for property
Ireland management; from August, 1995 to
Age: 30 August, 1996, ______ of Fowler,
Rosenau & Geary, L.P. (stock
specialist firm).
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SHARES OWNED OF
NAME, PRINCIPAL OCCUPATION, RECORD OR PERCENTAGE
BUSINESS ADDRESS AND AGE BUSINESS EXPERIENCES BENEFICIALLY OF CLASS
------------------------ -------------------- ------------ --------
Gregory Rotman Since February, 1999, President & 8,309,005 17.66%
President and Chief Executive Chief Executive Officer of the
Officer of the Company, Company. From 1995 to 1998,
4 Brussels Street, Worcester, Partner of Teamworks, Inc., LLC
Massachusetts 01616 (design, financing and build-out
Age: 34 of MCI National Sports Museum.)
Richard Rotman Since February, 1999, Chief 10,155,451 21.58%
Chief Financial Officer, Vice Financial Officer, Vice President
President and Secretary of the & Secretary of the Company. From
Company, February, 1997 to February, 1999,
4 Brussels Street, Worcester, President of Rotman Auctions,
Massachusetts 01610 Inc. (a full-service collection
Age: 29 house). From prior to 1995 to
February, 1997, Operation Manager
of Rotman Collectibles (sports
memorabilia).
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* Less than 1%the address of the Company.
Name and Address of Number of Shares % of
Beneficial Owner Beneficially Owned Class
---------------- ------------------ -----
Gregory Rotman 8,309,005 ____%
Richard Rotman 10,155,451 ____%
John Martin 1,199,292 (1) Represents____%
Andrew Pilaro 51,500 ____%
All directors and executive 19,715,248 ____%
officers as a group
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(1) Includes 265,375 currently exercisable options to purchase shares of
Common StockStock.
To the knowledge of the Company.
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Company's management, as of the Record Date, there
are no persons and/or companies who or which beneficially own, directly or
indirectly, shares carrying more than 5% of the voting rights attached to all
outstanding shares of the Company, other than Gregory Rotman and Richard Rotman,
are brothers. Each of Gregory Rotman and
Richard Rotman was first elected a Director in 1999. SEE "Certain Information
about Nominees" below.
Each Nominee has consented to serve as a director of the Company, if
elected. If any Nominee is unable or declines to serve, the discretionary
authority provided to the Rotman Group's proxy holders will be exercised to vote
at the Meeting for a substitute designed by the Rotman Group's proxy holders.
The Rotman Group has no reason to believe that any of its Nominees will be
unable to or will decline to serve.
THE SOLICITATION EXPENSES OF THE ROTMAN GROUP
The cost of solicitation will be borne initially by the Rotman Group. Total
expenditures for the solicitation, including fees for attorneys, accountants,
financial advisors, solicitors, advertising, printing, transportation, and other
costs incidental to the solicitation are estimated to be approximately
$_____________, of which approximately $15,000 of such expenditures have been
made to date. If elected, the Nominees intend to seek reimbursement from the
Company without a vote of the Company's security holders for the Rotman Group's
expenses incurred in connection with the Rotman Group's solicitation of proxies.
The Rotman Group has engaged D.F. King & Co., Inc. to assist in the
solicitation process. D.F. King & Co., Inc. will be paid its reasonable and
customary fees for its services, and will be reimbursed for its expenses. D.F.
King & Co., Inc. will use approximately ____ persons in its solicitation
efforts. In addition to the use of the mails, solicitations of proxies may be
made by means of personal calls upon, or telephonic communications to or with
stockholders or their personal representatives by members of the Rotman Group
and by D.F. King & Co., Inc. Copies of the soliciting materials of the Rotman
Group will be furnished to banks, brokerage houses, fiduciaries and other
nominees for forwarding to beneficial owners of shares and the Rotman Group will
reimburse them for their reasonable out-of-pocket expenses for forwarding such
materials.
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CERTAIN INFORMATION ABOUT THE NOMINEES AND CERTAIN
RELATIONSHIPS BETWEEN THE NOMINEES AND THE COMPANY
On February 25, 1999, the Company purchased all of the outstanding common
stock of Internet Auction, Inc., a Massachusetts corporation ("Internet
Auction"), which was wholly owned by Gregory Rotman, Richard Rotman, Marc
Stengel and Hannah Kramer, (the "IA Shareholders") in exchange for the issuance
to the IA Shareholders of an aggregate of 37,368,912 shares, representing
approximately 80%, of the Company's common stock (the "Transaction"). As a
result of the Transaction the principal business of Internet Auction became the
business of the Company and Gregory Rotman, Richard Rotman, Marc Stengel and
Hannah Kramer became the Directors of the Company.
Gregory Rotman and Richard Rotman became executive officers of the Company
in February 1999. For the year ended December 31, 1999, the Company paid Gregory
Rotman, its President and Chief Executive Officer, and Richard S. Rotman, its
Chief Financial Officer, Vice President and Secretary, $124,519 and $126,194,
respectively. For the year ended December 31, 1999 Martin received compensation
of $______ from the Company.
In connection with the Transaction, Martin was granted options to purchase
471,000 shares of Common Stock of the Company at an exercise price of $.01 per
share, of which 147,875 are currently exercisable. No stock options were granted
to or exercised by Gregory Rotman or Richard Rotman in the fiscal year ended
December 31, 1999. Gregory Rotman and Richard Rotman held no option to purchase
Common Stock of the Company at December 31, 1999.
Andrew Pilaro purchased 700 shares of Common Stock at a price of $7.00 per
share on April 22, 1999 and 1000 shares of Common Stock at a purchase price of
$.75 on October 28, 1999.
In September 1999, the Company purchased certain computer equipment,
Internet research technology and coding material for a purchase price of $70,000
from a corporation owned by Gregory Rotman and Richard Rotman.
All of the purchases and sales of Common Stock of the Company by John
Martin, Andrew Pilaro, Gregory Rotman and Richard Rotman within the past two
years are set forth above. Except as set forth above, none of John Martin,
Andrew Pilaro, Gregory Rotman or Richard Rotman is, or within the past year has
been, a party to any contractual arrangements or understandings with any person
with respect to the securities of the Company.
-6-
PRINCIPAL HOLDERS OF COMMON STOCK
Based on the Company's Form 10-KSB/A dated April 25, 2000,and the following are the only persons who beneficially own more than 5%persons:
5
Preliminary Copy
Name and Address of the Common
StockNumber of the Company:
NAME AND ADDRESS NUMBER OF SHARES PERCENTAGE
OF BENEFICIAL OWNER BENEFICIALLY OWNED OF CLASS
------------------- ------------------ --------
Gregory Rotman
4 Brussels Street 8,309,005 17.66%
Suite 220
Worcester, Massachusetts 01610
Richard Rotman
4 Brussels Street 10,155,451 21.58%
Suite 220
Worcester, Massachusetts 01610
Marc Stengel 12,925,119 27.47%
[address]
Hannah Kramer 5,539,337 11.77%
[address]
Gregory Rotman, Richard Rotman andShares % of
Beneficial Owner Beneficially Owned Class
---------------- ------------------ -----
Marc Stengel are all of the executive
officers of the Company and they and9,136,119(1) ____%
3743 Birch Lane
Owings Mills, MD 21117
Hannah Kramer are all of5,139,337 ____%
673 Korisa Drive
Huntingdon Valley, PA 19006
-------------
(1) Based solely upon the directors ofForm 4 filed with the Company. Gregory Rotman, Richard Rotman, Marc Stengel and Hannah Kramer as a
group own 36,928,912 shares representing 78.4% of the outstanding Common Stock.SEC on October 10, 2001.
DATE FOR SUBMISSION OF STOCKHOLDER PROPOSALS
In order for a proposal by a stockholder of the Company to be included in
the Company's proxy statement for the 20012002 annual meeting of stockholders, the
proposal must be received by the Company no later than February 15, 2001.
Shareholders__, 2002.
Stockholders who intend to present a proposal at the 20012002 annual meeting of
stockholders, but who do not wish to have such proposal included in the
Company's Proxy Statement for such meeting, must provide notice of such proposal
to the Company's Secretary at the Company's executive offices not later than May
1, 2001.
-7-
VOTE TODAY --- ELECT THE ROTMAN GROUP'S NOMINEES
Your vote is important,__, 2002.
OTHER MATTERS
The Board of Directors knows of no matter how manyother matters other than those described
in this Consent Solicitation Statement which must be approved or how fewconsidered by
the holders of the Company's Common Shares you own. The Rotman Group urges you to mark, sign, date and return
the enclosed [BLUE] proxy card to vote for election of the Nominees. The Rotman
Group urges you to vote for the Nominees --- every vote counts.
If your shares of Common Stock of the Company are registered in your own
name, please mark, sign and date the enclosed [BLUE] proxy card and return it to
the Rotman Group, c/o of D.F. King & Co.,voting stock.
IF YOU HAVE ANY QUESTIONS REGARDING THIS CONSENT SOLICITATION STATEMENT
AND/OR THE CHARTER AMENDMENT, PLEASE CONTACT:
Sales Online Direct, Inc., in the enclosed envelope in time
to be voted at the Meeting. If any of your shares of Common Stock of the Company
are held in the name of a brokerage firm, bank, bank nominee or other
institution on the record date, only it can vote such shares of the Company's
Common Stock and only upon receipt of your specific instructions. Accordingly,
please contact the person responsible for your account and instruct that person
to execute on your behalf the [BLUE] proxy card. The Rotman Group urges you to
confirm your instructions in writing to the person responsible for your account
and to provide a copy of such instructions to the Rotman Group, c/o D.F. King &
Co., Inc. at the address indicated below. If you have any questions, please
call:
D.F. King & Co., Inc.
77 Water
4 Brussels Street
New York, New York 10005
Call Toll Free: (800) 431-9629
August ____, 2000
PLEASE MARK, SIGN, DATE AND RETURN THE ENCLOSED [BLUE] PROXY CARD PROMPTLY. NO
POSTAGE IS REQUIRED IF MAILED IN THE UNITED STATES.Worcester, Massachusetts 01610
(508) 791-6710
BY MARKING, SIGNING, DATING
AND RETURNING THE ENCLOSED [BLUE] PROXY CARD, ANY PROXY PREVIOUSLY SIGNED BY YOU
WILL BE REVOKED. REMEMBER, ONLY YOUR LATEST DATED PROXY WILL COUNT AT THE
MEETING.
-8-
PROXY SOLICITED BY
GREGORY ROTMAN AND RICHARD ROTMAN
(the "Rotman Group")
IN SUPPORTORDER OF THEIR NOMINEES
TO THE BOARD OF DIRECTORS
Gregory Rotman
President
6
Preliminary Copy
APPENDIX A
CERTIFICATE OF AMENDMENT
OF
CERTIFICATE OF INCORPORATION
OF
SALES ONLINE DIRECT, INC.
Sales Online Direct, Inc., a corporation organized and existing under and
by virtue of the General Corporation Law of the State of Delaware,
DOES HEREBY CERTIFY:
FIRST: That the Board of Directors of said corporation, by unanimous
written consent of its members pursuant to Section 141(f) of the General
Corporation Law of the State of Delaware, filed with the minutes of the Board of
Directors, adopted a resolution proposing and declaring advisable the following
amendment to the Certificate of Incorporation of said corporation.
RESOLVED, that the Certificate of Incorporation of Sales Online
Direct, Inc. be amended by changing the FOURTH Article thereof so that, as
amended, said Article shall be and read in its entirety as follows:
"FOURTH: The amount of total authorized capital stock of the
corporation shall be divided into 350,000,000 shares of common stock
having a par value of $.001 each."
SECOND: That in lieu of a meeting and vote of stockholders, the
stockholders holding a majority of the outstanding shares of stock entitled to
vote on the amendment have given written consent to said amendment in accordance
with the provisions of Section 228 of the General Corporation Law of the State
of Delaware and written notice of the adoption of the amendment has been given
as provided in Section 228 of the General Corporation Law of the State of
Delaware to every stockholder entitled to such notice.
THIRD: That the aforesaid amendment was duly adopted in accordance
with the applicable provisions of section 242 and Section 228 of the General
Corporation Law of the State of Delaware.
FOURTH: That this Certification of Amendment of the Certificate of
Incorporation shall be effective on the date of filing.
IN WITNESS WHEREOF, said Sales Online Direct, Inc., has caused this
Certificate to be executed, acknowledged and filed by its President this ____
day of ________, 2001.
SALES ONLINE DIRECT, INC.
By:
-----------------------------------
Gregory Rotman, President
Preliminary Copy
SALES ONLINE DIRECT, INC.
4 Brussels Street
Worcester, Massachusetts 01610
CONSENT
THIS CONSENT IS SOLICITED ON BEHALF OF THE BOARD OF DIRCTORS OF SALES ONLINE
DIRECT, INC.
The undersigned stockholder of Sales Online Direct, Inc. (the "Company") as of
November 6, 2001, hereby appoints Gregory Rotman and Richard Rotman and each
of them, the proxy or proxiesconsents, pursuant to Section 228 of the undersigned,Delaware
General Corporation Law, with full power of
substitution,respect to vote all shares of Common Stock,common stock, par value
$.001 per share, of Sales OnLine Direct, Inc. (the "Company") whichthe Company held by the undersigned, wouldto the following action
without a meeting, without prior notice and without a vote.
Proposal (1): To approve an amendment to the Company's Certificate of
Incorporation, as amended, to increase the number of authorized shares of Common
Stock, $.001 par value, from 100,000,000 to 350,000,000 shares.
CONSENT ____ CONSENT WITHHELD ____ ABSTAIN ____
If no space is marked above with respect to the Charter Amendment, the
undersigned will be entitleddeemed to vote if personally present at the 2000 Special Meeting In Lieu of
Annual Meeting of Stockholders of the Company and at any and all adjournments,
postponements, reschedulings or continuations thereof (the "Meeting").
THE ROTMAN GROUP RECOMMENDS A VOTE
FOR THE ELECTION OF DIRECTORS BELOW.
1. Election of Directors (check one box only)
[ ] FOR ALL NOMINEES listed below
[ ] WITHHOLD AUTHORITYconsent to vote for all nominees listed below:
John Martin, Andrew Pilaro, Gregory Rotman, Richard Rotman
(TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVDUAL NOMINEE, CHECK THE "FOR" BOX
ABOVE AND WRITE THAT NOMINEE'S NAME ON THE LINE PROVIDED BELOW).
- --------------------------------------------------------------------------------
THE PROXIES ARE HEREBY AUTHORIZED TO VOTE IN THEIR DISCRETION UPON ALL OTHER
MATTERS WHICH MAY PROPERLY COME BEFORE THE MEETING OR ANY ADJOURNMENTS,
POSTPONEMENTS, RESCHEDULINGS OR CONTINUATIONS THEREOF.
(over)
THIS PROXY WILL BE VOTED AS DIRECTED, BUT IF NO DIRECTION IS INDICATED, IT
WILL BE VOTED FOR THE ELECTION OF THE NOMINEES LISTED IN PROPOSAL 1 AND, IN THE
DISCRETION OF THE PROXIES, ON SUCH OTHER MATTERS AS MAY PROPERLY COME BEFORE THE
MEETING OR ANY ADJOURNMENTS, POSTPONEMENTS, RESCHEDULINGS OR CONTINUATIONS
THEREOF.
THE ROTMAN GROUP RECOMMENDS THAT YOU VOTE FOR EACH OF THE NOMINEES IN
PROPOSAL 1.
DATED:_____________________, 2000
___________________________________
Signature
___________________________________
Signature, if held jointly
___________________________________
Title or Authoritysuch amendment.
PLEASE SIGN, EXACTLY AS YOUR NAME APPEARS ONDATE AND RETURN THIS PROXY.CONSENT PROMPTLY, USING THE ENCLOSED
ENVELOPE. JOINT OWNERS SHOULD EACH SIGN PERSONALLY. IF SIGNING AS ATTORNEY,
EXECUTOR,EXECUTER, ADMINISTRATOR, TRUSTEE OR GUARDIAN, PLEASE INCLUDE YOUR FULL TITLE.
CORPORATE PROXIES SHOULD BE SIGNED BY AN AUTHORIZED OFFICER.
PLEASE SIGN, DATE AND RETURN THIS CARD PROMPTLY USING THE ENCLOSED ENVELOPE.Date: , 2001
----------------------
(Date is Mandatory for all Consents)
-------------------------------------------
(Printed Name of Stockholder)
-------------------------------------------
(Signature of Stockholder)
-------------------------------------------
(Signature of Stockholder, if held jointly)