lmorovan:
MARCH 11, 2003
"7. Second, the settlement responds in several ways to plaintiffs' contention that the individual defendants breached their fiduciary duties and committed waste in their control of Loch:
(a) Any CDEX shares that the Individual Defendants directly or indirectly receive through the share exchange, own, or have a beneficial interest in will be non-voting or have a voting proxy.
(b) The Individual Defendants and persons whom they control will be permanently ineligible to serve as directors, officers, employees, or consultants of CDEX (except that two defendants will be allowed to complete outstanding obligations to CDEX under consulting agreements that predate the Settlement Agreement).
(c) Loch will be dissolved promptly after the share exchange pursuant to the judicial reorganization / sale, so the individual defendants will necessarily cease the activities that plaintiffs alleged constituted a continuing breach of fiduciary duty and waste. A liquidator will be appointed to dispose of the company's remaining property, with the potential of a final distribution to the former shareholders who participated in the share exchange and class members who opted out.
(d) Defendant Boone will relinquish 200,000 shares of CDEX and relinquish his right to 5 million shares of Loch Harris that he contends he paid for but were not issued; defendant Mark Baker will relinquish 500,000 shares of CDEX; and defendant R.B. Baker will relinquish 1 million shares of Loch Harris. These relinquished shares will go into the Loch corporate treasury to be part of the distribution to class members or to fund certain other obligations and expenses as explained in the Settlement Agreement.
(e) The Individual Defendants (in their capacities as officers and directors of Loch Harris) and Loch Harris will prevent the company from distributing any benefit whatsoever (e.g., money, repayment of loans, compensation of any sort, or any other type of benefit) to the Individual Defendants except for repayment of funds advanced to the company on or after September 17, 2001 to pay third-party claims."
Please note 7a- The b boys CANNOT VOTE their stock. They are still powerless!
Please 7b- On May 13, 2003, the executive service agreements were cancelled by Mr. Phillips, CEO of CDEX.
So, lomorovan, as usual, all of your points about who inc what are nothing but a mute point. There were obviously certain trade offs to allow the tech to continue to move forward. But your points about Baker or Boone calling any shots at CDEX, is nothing but FALSE!
AI
