Siti-sites.com, Inc. Announces Amended Plan of Final Liquidation and Dissolution Being Filed in an SEC Form 14A Proxy Statement
September 22 2006 - 10:45AM
PR Newswire (US)
NEW YORK, Sept. 22 /PRNewswire-FirstCall/ -- (OTC Bulletin Board:
SITN; SITN.PK, and by Email to ) Siti-sites.com, Inc. (CUSIP 82981
-- formerly named Spectrum Information Technologies, Inc. and
called "Siti" in its various SEC reports, symbol SITN.PK) announced
today it is preparing and filing shortly a preliminary form of
Proxy Statement under Section 14 (a) of the Securities Exchange Act
of 1934 with the SEC. The preliminary Proxy Statement contemplates
a special meeting of stockholders and a vote on a Plan of Final
Liquidation and Dissolution (the "Plan") set forth therein,
including solicitation of proxies. This is a change in format for
stockholder approval without substantive change in the Plan itself.
Record date The definitive form of Proxy Statement will be mailed
to those stockholders shown of record as of October 10, 2006,
unless unforeseen circumstances require an adjourned date. The
foregoing amends a previous announcement made on September 13, 2006
regarding the previous stockholder review and approval format.
Siti's board of directors has unanimously approved the Plan, and
Siti's largest shareholder Lawrence M. Powers informed the board
that he expects to vote in favor of the Plan. His shares,
beneficially owned with his son, amount to 46.1% of those
outstanding. Several other large stockholders, in an overall total
comprising some 83 % of outstanding shares, will review the Plan
along with other stockholders when it is in appropriate form in the
definitive Proxy Statement, and thereafter vote in person or by
proxy. The voting will be at a meeting of stockholders expected to
be held in late October, as described in the preliminary Proxy
Statement (when it becomes definitive). The Company's previous
intention of seeking consents from its large stockholders, without
a meeting or any proxy solicitation, was being done to conserve the
limited cash available at present ($ 279,000 as of 8/31/06). But it
was recently discovered that such approach would not work either
under the Company's certificate of incorporation or relevant SEC
proxy rules. Therefore this amended filing being prepared is being
announced. The following material largely repeats the earlier
announcement being amended. Reasons for Plan The Plan formalizes
the ongoing liquidation of Siti pending since 2002, which recently
resulted in a $.15 per share liquidating dividend ($4,504,000) paid
pro rata to all stockholders, resulting from the settlement of
certain litigation as previously announced. It was the first time
that Siti had any funds available to distribute to stockholders
since its liquidation was commenced in 2002. A Summary of the Plan,
and its basis in the Underlying Facts on Siti's Liquidation, is
expected to be included in the definitive form of Proxy Statement.
The main points of the Plan are to conserve Siti's limited
remaining cash assets from the recent settlement after payment of
its first liquidating dividend in April, 2006, by taking steps
under Delaware law to enter final liquidation and dissolution of
the corporation, under the various phases provided therefor in
Delaware law. Many of its ongoing accounting, stock transfer, legal
and other costs as a public company after 2006 should be saved.
Siti has no creditors that have not been paid or provided for in
the Plan, Siti never made any material borrowings, and all earlier
claims have been fully satisfied since liquidation began in 2002.
The Plan, however, provides for continuing efforts to obtain Siti's
share of gross receipts as a creditor of the substantial patent
portfolio in issue in the litigation that has been settled
amicably, further elaborated below. These efforts are expected to
continue at least three years or much longer while Siti is in
Delaware dissolution proceedings. Siti may ultimately enter into a
liquidation trust for the benefit of former stockholders in the
liquidation. The settlement and the patent portfolio wherein Siti
is a creditor are described in earlier filings in 2006 on SEC Forms
8-K, 10-K and 10-Q publicly available. Based on several months of
cooperative reporting and dealings with the company owning the
patent portfolio, Siti cannot realistically expect any material
recovery as a creditor of such company, for some 12 to 18 months.
Siti is not conducting, and does not plan to conduct any ongoing
business, other than these collection activities under the
settlement agreement. Siti also determined in late August, 2006 to
abandon any further activity to generate a "reverse-merger"
transaction which might yield a nominal amount of stock for its
shareholders in liquidation, because of a lack of success over the
past five years in finding an appropriate transaction. Cancellation
of Shares in Liquidation The Plan provides for cancellation of all
outstanding shares of Siti, in exchange for the liquidating
distribution made in April 2006 and any further liquidating
distributions that become possible in the future, during the
extensive life of the patent portfolio (expiring 2009 through 2021)
covered by the settlement. The Plan covers all such distributions,
if any. Other details of the Plan and its economic and federal tax
impact on both Siti and its stockholders will be described in the
definitive form of the Proxy Statement, when it ultimately becomes
available for delivery to all stockholders. After review and likely
stockholder consent to the Plan expected in October, 2006, the
certificate of dissolution will be filed in Delaware, and further
trading in the shares of Siti are expected to cease. The cash
amounts distributed to shareholders in liquidation of Siti, in
April, 2006 or hereafter distributed to shareholders, if any, shall
be deemed and treated as being in full payment in exchange for the
stock of Siti pursuant to Section 331 of the U.S. Internal Revenue
Code. The Plan provides for cessation of trading by prompt
cancellation of the shares 30 days after its effective date,
anticipated by December, 2006. The shares of stock will not be
freely transferable thereafter. The list of former Siti
shareholders of record shall be used thereafter solely to determine
their pro rata entitlement to any future cash payments under the
Plan that may become possible. Such right to participate shall be
transferable only by operation of laws of inheritance, succession
or otherwise, and the cancelled stock certificate of each former
shareholder shall be the primary source of its or its successor
owner's right to receive any future liquidating dividend payments.
Siti will maintain the former shareholder records presently held at
its Stock Transfer Agent as long as practicable to facilitate any
future cash distributions. Any further information on the Plan must
await distribution of a definitive Proxy Statement. However the
following information contained in previous public releases and
filings by Siti or recently occurring, may be helpful to
stockholders in liquidation. See Siti's Form 10-K Annual Report for
2006, Item 3. Legal Proceedings - Future Proceeds, Risk Factors.
See further Siti's Form 8-K filed March 20, 2006, Item 1.01.
Material Agreements - Taxation. Latest Facts Available --
Prospective Additional Proceeds for Liquidating Dividends Over the
summer of 2006, the former defendant owners of the patents began
sharing more information with Siti than they were required to share
during adversarial litigation and settlement negotiations. The
facts soon clarified by late August, 2006: There does not appear to
be any prospect of further material receipts until mid 2007, if
then. The owners of the patent portfolio are conducting serious
litigation and claims against third parties claimed to be
infringers, and related steps that may yield substantial gross
receipts to Siti as a secured creditor, but it is not quantifiable
in 2006. Another distribution of cash as a liquidating dividend is
not foreseen for 12 to 18 months, based upon the patent owner's
reports as to the tempo of its own business operations. The stock
of Siti still trades publicly at nominal volume, and currently
trades at $ .05 per share, but there is no viable market for the
stock other than in minor amounts. Siti remains a defunct shell
except for the settlement claim receivable, which is highly
speculative and at best, well into the future. There is no
corporate business, and as noted, the five year search for a
"reverse merger" partner as a source for a nominal amount of shares
in a "good" business was abandoned in late August 2006. There are
no financial prospects at Siti except for the ongoing settlement
claim as described above. See further Siti's most recent Form 10-Q
filed August 14, 2006, Note 2 to Condensed Financial Statements,
updated as follows: The patent portfolio consists of 19 patents and
pending applications that cover data and voice connections between
computers and cell phones, and roaming across the U.S. and
elsewhere with cell phones, personal digital assistants and
wireless equipment in vehicles. The latest patents in the portfolio
also cover spectrum sharing among various wireless communication
networks. The Company's senior creditor position in future proceeds
is documented in filings in the U.S. Patent and Trademark Office
and in several states under the Uniform Commercial Code. Siti
management believes, on good factual grounds including the
technical opinions of its eminent experts in wireless technology
employed in the litigation, that there are Gross Proceeds yet to be
earned therefrom. Siti believes they can be handled effectively for
the benefit of all stockholders pro rata, during its Plan of Final
Liquidation and Dissolution. Each large stockholder described in
Security Ownership of Certain Beneficial Owners and Management in
Siti's Form 10-K Annual Report for 2006, as amplified in the
definitive Proxy Statement, has a substantial economic interest in
completion of the corporate and tax matters, as a stockholder, to
be acted upon in approving the Plan. Such economic interest, while
in varying amounts based on share ownership, is believed to be
substantially identical to those of all other stockholders, unless
indicated otherwise in the preliminary Proxy Statement. DATASOURCE:
Siti-sites.com, Inc. CONTACT: Toni Tantillo, +1-914-779-7155, Web
site: http://www.siti-sites.com/
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