lmorovan:
MARK BAKER and Rod Boone would be the correct answer.
Now, why were they allowed to do so?
Maybe the answer lies in the business wire below:
"Business Editors
AUSTIN, Texas--(BUSINESS WIRE)--Aug. 10, 2001
Loch Harris Inc., (OTC:LOCH) a Nevada corporation and CDEX-Inc., a Nevada corporation (CDEX) are pleased to announce the finalization and execution of an Asset Purchase Agreement (Agreement) on Aug. 4, 2001.
Under the Agreement, Loch transferred to CDEX all its ownership (including revenue interests) in certain assets and technologies, including its chemical and explosives detection technologies. Loch warranted to CDEX that its ownership interests in the assets and technologies would be unencumbered by competing claims and debts against ownership, including those associated with Coldwater Capital LLC, and potential claims to ownership and royalties related to the previous funding provided by it to Loch for development of the technologies. In exchange, CDEX agreed to issue at Loch's direction 69,350,000 shares of the approximately 80,000,000 shares of CDEX common stock that is anticipated to be issued per events surrounding this Agreement.
Of the 69,350,000 CDEX shares issued at Loch's direction, based upon the number of Loch shares currently outstanding, it is anticipated that approximately 48,000,000 CDEX shares will be distributed directly to holders of Loch stock (one share of CDEX stock will be distributed for every ten shares of Loch stock owned as of the record date). The record date for Loch stock ownership determination is to be announced in the near future. These shares of CDEX stock to be distributed to Loch shareholders are currently being retained by Loch until distribution.
110***In addition, it is anticipated that approximately 13,000,000 shares of CDEX stock will be retained as part of Loch's assets. The final 8,350,000 shares were issued at Loch's direction to resolve any obligations, loans, or royalties, which could result in potential claims of parties against the assets or technologies transferred. These obligations, loans, and potential claims include those of Coldwater Capital LLC, Rodney Boone and Mark Baker, both of whom are officers and directors of Loch, and who have rendered services and made, guaranteed and/or pledged collateral for loans to or on behalf of Loch in connection with the assets and technologies.
220***-Of the remaining approximately 10,650,000 shares of CDEX that were or may be issued pursuant to events surrounding this Agreement, 7,200,000 have been issued to or at the direction of the six member operating team of CDEX, including Malcolm H. Philips, Jr., Timothy D. Shriver and Dr. Wade Poteet. In addition, 1,850,000 shares were issued to consultants of CDEX, including 500,000 and 750,000 shares to secure the services of Baker and Boone, respectively, for transition and consulting services to CDEX.
It should be noted that all shares issued to the CDEX Operating Team and to CDEX consultants, have stock repayment provisions in the event that certain types of termination of services occurs prior to the scheduled end of the respective contracts. Finally, consideration is being given to issuing 1,600,000 shares of CDEX to procure additional funding for CDEX.
330***-In accordance with the Agreement, the voting rights of shares received by any officer or director of Loch as a result of the Agreement, as well as the voting rights to the 13,000,000 shares currently anticipated to be retained by Loch after the distribution, have been assigned by proxy to the CDEX Board of Directors.
In addition, the voting rights of shares currently intended for distribution to Loch shareholders (approximately 48,000,000) will be assigned by proxy to the CDEX Board of Directors, if such distribution has not occurred by Oct. 1, 2001. The proxies on all the foregoing shares will lapse upon the transfer of the respective shares to a party not controlled by Loch or Loch's officers or directors.
Loch anticipates that the shares retained by it will be used in connection with addressing general corporate purposes. As previously announced, Loch believes the transfer of the technology to CDEX and anticipated spin-off of CDEX shares is in accordance with its long-range objectives.
440***-In addition, on Aug. 4, 2001, new management (completely separate from Loch's management) assumed control of all CDEX operations. As previously reported, the new management consists of Malcolm H. Philips, Jr., president and CEO and Timothy D. Shriver, senior vice president of operations (biographical summaries, as well as other information regarding CDEX are contained on the CDEX Web site located at www.CDEX-Inc.com). The new CDEX Board consists of Malcolm H. Philips, Jr., Chairman and George E. Dials."
Please note 110***- Pay special attention to the last sentence in the paragragh.
Please note 220***- Another important paragragh.
Please note 330***- The very ones who incorporated CDEX cannot VOTE their shares!!! Thus, they have ZERO SAY! Hum, sounds like a trade off! EXTEMELY important paragragh!
Please note 440***- "COMPLETELY SEPARATE" You do understand exactly what completely separate means. You can bet the SEC understood.
AI
