UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
Schedule 14A
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:
[ ] Preliminary Proxy Statement [ ] Confidential for use of the Commission
[X] Definitive Proxy Statement only (as permitted by Rule 14a-6(e)(2))
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to ss.240.14a-11(c) of ss.240.14a-12
ONSCREEN TECHNOLOGIES, INC.
(Name of Registrant as Specified in its Charter)
(Name of Person(s) Filing Proxy Statement if other than the Registrant)
Not applicable
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[X] No Fee Required
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
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pursuant to Exchange Act Rule 0-11: (set forth the amount in which the
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0-(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.
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OnScreen Technologies, Inc.
600 NW 14th Avenue, Suite 100
Portland, Oregon 97209
October 11, 2006
Dear Stockholder:
It is my pleasure to invite you to the 2006 Annual Meeting of Stockholders of
OnScreen Technologies, Inc. The 2006 Annual Meeting will be held on Wednesday,
December 6, 2006 at 9:00 a.m. PST in the corporate offices located at 600 NW
14th Avenue, Suite 100, Portland, Oregon 97209 for the following purposes:
1. To elect three directors to hold office for two-year terms and one
director to hold office for a one year term;
2. To transact such other business as may properly come before the
Annual Meeting or any adjournments or postponements thereof.
The notice of the meeting and proxy statement on the following pages contains
information on the formal business of the meeting. Whether or not you expect to
attend the meeting, please sign, date, and return your proxy promptly in the
enclosed envelope to assure your stock will be represented at the meeting.
The continuing interest of the stockholders in the business of the Company is
gratefully acknowledged and appreciated.
Sincerely,
/s/ William J. Clough
---------------------------
William J. Clough, Esq.
Corporate Secretary and
General Counsel
ONSCREEN TECHNOLOGIES, INC.
NOTICE OF 2006 ANNUAL MEETING OF SHAREHOLDERS
To be held Wednesday, December 6, 2006 at 9:00 a.m. PST in the corporate offices
located at 600 NW 14th Avenue, Suite 100, Portland, Oregon 97209.
To: The Shareholders of OnScreen Technologies, Inc.
We will hold the 2006 Annual Meeting of Shareholders (the "Annual Meeting") of
OnScreen Technologies, Inc. on Wednesday, December 6, 2006 at 9:00 a.m. PST in
the corporate offices located at 600 NW 14th Avenue, Suite 100, Portland, Oregon
97209 for the following purposes:
1. To elect three directors to hold office for two-year terms and one
director to hold office for a one year term;
2. To transact such other business as may properly come before the
Annual Meeting or any adjournments or postponements thereof.
These items of business are more fully described in the proxy statement
accompanying this notice. The Board of Directors has fixed the close of business
on October 12, 2006 as the record date for the determination of shareholders
entitled to receive notice of, and to vote at, the Annual Meeting. For a period
of at least ten days prior to the Annual Meeting, a complete list of
shareholders entitled to vote at the Annual Meeting will be open to examination
by any shareholder during ordinary business hours at the offices of the Company,
OnScreen Technologies, Inc., 600 NW 14th Avenue, Suite 100, Portland, Oregon
97209.
All shareholders are cordially invited to attend the Annual Meeting. However, to
assure your representation at the Annual Meeting, we ask that as promptly as
possible you mark, sign, date, and return the enclosed proxy card in the postage
prepaid envelope enclosed for that purpose. Your stock will be voted in
accordance with the instructions you give in your proxy. Your proxy may be
revoked at any time before it is voted by signing and returning a proxy bearing
a later date for the same shares, by filing with the Secretary of the Company a
written revocation bearing a later date or by attending and voting in person at
the annual meeting.
By Order of the Board of Directors
/s/ William J. Clough
---------------------------
William J. Clough, Esq.
Corporate Secretary and
General Counsel
Portland, Oregon
October 11, 2006
WE URGE YOU TO SIGN, DATE AND RETURN THE ENCLOSED PROXY CARD(S) WHICH IS
SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS AS SOON AS POSSIBLE, EVEN IF YOU
ARE CURRENTLY INTENDING TO ATTEND THE MEETING. THIS WILL NOT PREVENT YOU FROM
VOTING IN PERSON, BUT WILL ASSURE THAT YOUR VOTE IS COUNTED IF YOU ARE UNABLE TO
ATTEND THE MEETING.
ONSCREEN TECHNOLOGIES, INC.
PROXY STATEMENT
INTRODUCTION
This Proxy Statement is furnished in connection with the solicitation of proxies
by the Board of Directors of OnScreen Technologies, Inc. (the "Company") for use
at the 2006 Annual Meeting of Stockholders to be held on Wednesday, December 6,
2006 at 9:00 a.m. PST in the corporate offices located at 600 NW 14th Avenue,
Suite 100, Portland, Oregon 97209 or at any postponements or adjournments
thereof. Your vote at the Annual Meeting is important to us. Please vote your
shares of OnScreen Technologies, Inc. common stock (the "Common Stock") and
preferred stock (Preferred Stock) by completing the enclosed proxy card and
returning it in the enclosed envelope. The approximate date on which this Proxy
Statement and the accompanying proxy card will be mailed to stockholders is
November 1, 2006.
GENERAL INFORMATION ABOUT THE ANNUAL MEETING
What is the purpose of the Annual Meeting?
At our Annual Meeting, stockholders will act upon the matters outlined in the
notice of meeting on the cover page of this Proxy Statement, including the
election of three directors to hold office for two-year terms and one director
to hold office for a one year term and to transact such other business as may
properly come before the Annual Meeting or any adjournments or postponements
thereof.
Who is entitled to vote?
Only stockholders of record at the close of business on October 12, 2006, the
record date for the meeting, are entitled to receive notice of and to
participate in the Annual Meeting. If you were a stockholder of record on that
date, you will be entitled to vote all of the shares that you held on that date
at the Annual Meeting, or any postponements or adjournments of the meeting. Each
outstanding share of Common Stock owned by you on October 12, 2006 entitles you
to one vote on each matter considered at the Annual Meeting. The enclosed proxy
card shows the number of shares owned by you as of the record date.
Who may attend the annual meeting?
All stockholders of record as of the record date, or their duly appointed
proxies, may attend the meeting.
What constitutes a quorum?
The presence at the Annual Meeting, in person or by proxy, of the holders of one
third of the aggregate voting power of the Common and Preferred Stock
outstanding on the record date will constitute a quorum. Each share of Common
Stock and each share of Series A Convertible Preferred Stock is entitled to one
vote. As of the close of business on August 31, 2006, 129,573,333 shares of
Common Stock and 415,543 shares of Series A Convertible Preferred Stock were
outstanding and entitled to vote at the Annual Meeting. Unless otherwise
indicated, all references herein to percentages of outstanding shares of stock
are based on such numbers of shares outstanding. Shares entitled to vote are
referred to hereafter as "Voting Shares".
How do I vote?
If you complete and properly sign the accompanying proxy card and return it,
your shares of Stock will be voted as you direct. If you are a registered
stockholder and attend the meeting, you may deliver your completed proxy card in
person. "Street name" stockholders who wish to vote at the meeting will need to
obtain a proxy form from the institution that holds their shares.
May I change my vote after I return my proxy card?
Yes, even after you have submitted your proxy, you may revoke or change your
vote at any time before the proxy is exercised by providing William F. Clough,
Esq., our Corporate Secretary, either a written notice of revocation or a duly
executed proxy bearing a later date. The powers of the proxy holders will be
suspended if you attend the Annual Meeting in person and so request, although
attendance at the meeting will not by itself revoke a previously granted proxy.
What are the board's recommendations?
Unless you give other instructions on your proxy card, the persons named as
proxy holders on the proxy card will vote in accordance with the recommendations
of the Company's Board of Directors. The Board's recommendation is set forth
together with the description of each item in this Proxy Statement. In summary,
the Board recommends a vote:
FOR election of the nominated slate of Directors (see Proposal 1).
What vote is required to approve each item?
Election of Directors. The affirmative vote of a plurality of the votes cast at
the Annual Meeting is required for the election of the directors. A properly
executed proxy marked "Withhold Authority" with respect to the election of one
or more directors will not be voted with respect to the director or directors
indicated, although it will be counted for purposes of determining whether there
is a quorum. Voting Shares represented by properly executed proxies for which no
instruction is given will be voted "FOR" election of the nominees for director
If you hold your shares in "street name" through a broker or other nominee, your
broker or nominee may not be permitted to exercise voting discretion with
respect to some of the matters to be acted upon. Thus, if you do not give your
broker or nominee specific instructions, your shares may not be voted on those
matters and will not be counted in determining the number of shares necessary
for approval. Shares represented by such "broker non-votes" will, however, be
counted in determining whether there is a quorum.
What if other matters come up at the Annual Meeting?
Aside from the election of the directors, the Board of Directors knows of no
other maters to be presented at the Annual Meeting. If any other matter should
be presented at the meeting upon which a vote properly may be taken, the shares
represented by the proxy holders will be voted in the discretion of the proxy
holders.
Proposals by Shareholders
Shareholder proposals intended to be presented at the Annual Meeting must have
been received by us not later than September 16, 2006 for inclusion in the proxy
materials for the Annual Meeting. We are not aware of any matters to be voted on
at the Annual Meeting except those listed on the accompanying notice of Annual
Meeting of shareholders. The accompanying proxy gives discretionary authority to
the persons named to vote the shares in their best judgment if any other matters
are properly brought before the Annual Meeting.
What if the Annual Meeting is postponed?
If the Annual Meeting is postponed or adjourned for any reason, at any
subsequent reconvening of the Annual Meeting, all proxies will be voted in the
same manner as the proxies would have been voted at the original convening of
the Annual Meeting, except for any proxies that have at that time effectively
been revoked or withdrawn, notwithstanding that they may have been effectively
voted on the same or any other matter at a previous meeting.
Who pays for this proxy solicitation?
We do. The proxies being solicited in connection with this Proxy Statement are
being solicited by the Board of Directors and the costs will be borne by the
Company. In addition to sending you these materials, some of our employees may
contact you by telephone, by mail, or in person. None of these employees will
receive any extra compensation for doing this. We will, upon request, reimburse
brokerage firms and others for their reasonable expenses in forwarding
solicitation material to the beneficial owners of our stock.
SECURITY OWNERSHIP OF BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information regarding beneficial
ownership of our Voting Shares as of the date of this filing by: (i) each
shareholder known by us to be the beneficial owner of 5% or more of the
outstanding Voting Shares, (ii) each of our directors and executives and (iii)
all directors and executive officers as a group. Except as otherwise indicated,
we believe that the beneficial owners of the Voting Shares listed below, based
on information furnished by such owners, have sole investment and voting power
with respect to such shares, subject to community property laws where
applicable. Shares of common stock issuable upon exercise of options and
warrants that are currently exercisable or that will become exercisable within
60 days of filing this document have been included in the table.
BENEFICIAL INTEREST TABLE
---------------------------------- ------------------------------ -------------------------- ----------------
Common Stock Series A Convertible
Preferred Stock
---------------------------------- ----------------- ------------ ------------ ------------- ----------------
Name and Address Number Percent of Number Percent of Percent of all
of Beneficial Voting
Owner (1) Class (2) Class (3) Securities (4)
---------------------------------- ----------------- ------------ ------------ ------------- ----------------
Brad Hallock (5) 10,284,540 7.63% - - 7.61%
William Clough (6) 5,051,089 3.73% - - 3.72%
Russell Wall (7) 1,691,493 1.28% - - 1.27%
Mark Chandler (8) 6,780,285 5.12% 250,000 62.42% 5.30%
Charles Baker (9) 2,100,000 1.57% - - 1.57%
John Rouse (10) 6,159,838 4.68% - - 4.66%
Stephen Hallock (11) 8,224,627 6.24% - - 6.22%
Walter Miles (12) 10,000,000 7.60% - - 7.57%
Kjell H. Qvale (13) 7,500,000 5.70% - - 5.68%
Jerry Ostrin - - 45,000 11.23% *
William Stansberry (14) 430,821 * 25,000 6.24% *
Nickola Nickoloff (15) - - 25,000 6.24% *
Joel Fedder - - 25,000 6.24% *
Officers, Directors,
executives as group 40,291,872 28.38% 250,000 62.42% 28.47%
* Less than 1 percent
(1) Except as otherwise indicated, the address of each beneficial owner is c/o
OnScreen Technologies, Inc., 600 NW 14th Avenue, Suite 100, Portland,
Oregon 97209.
(2) Calculated on the basis of 131,646,030 shares of common stock issued and
outstanding at September 26, 2006 except that shares of common stock
underlying options and warrants exercisable within 60 days of the date
hereof are deemed to be outstanding for purposes of calculating the
beneficial ownership of securities of the holder of such options or
warrants. This calculation excludes shares of common stock issuable upon
the conversion of Series A Preferred Stock.
(3) Calculated on the basis of 400,543 shares of Series A Preferred Stock
issued and outstanding at September 26, 2006.
(4) Calculated on the basis of an aggregate of 131,646,030 shares of common
stock with one vote per share and 400,543 shares of Series A Preferred
Stock with one vote per share issued and outstanding at September 26,
2006, except that shares of common stock underlying options and warrants
exercisable within 60 days of the date hereof are deemed to be outstanding
for purposes of calculating beneficial ownership of securities of the
holder of such options or warrants.
(5) Mr. Brad Hallock's common stock shares include 3,100,000 shares he has the
right to purchase pursuant to a warrant. Mr. Hallock's common stock shares
include 73,500 shares owned by his IRA account.
(6) Mr. Clough's common shares include 3,640,485 shares he has the right to
purchase pursuant to a warrant.
(7) Mr. Wall's common stock shares include 700,000 shares he has the right to
purchase pursuant to a warrant. Mr. Wall's common stock shares include
781,493 shares owned by his IRA account.
(8) Mr. Chandler's common stock shares include 700,000 shares he has the right
to acquire pursuant to a warrant. Mr. Chandler's Series A Preferred shares
include 250,000 shares owned by his IRA account.
(9) Mr. Baker's common stock shares include 2,100,000 shares he has the right
to purchase pursuant to a warrant.
(10) Mr. Rouse's common stock shares include 100,000 shares he has the right to
purchase pursuant to a warrant. Mr. Rouse's common stock shares include
16,500 shares owned by his IRA account.
(11) Mr. Miles' common stock share position includes direct entitlement and
related party management shares. Mr. Miles' common stock shares include
2,000,000 shares he has the right to purchase pursuant to a warrant.
(12) Mr. Stephen Hallock's common stock shares include 100,000 shares he has
the right to purchase pursuant to a warrant.
(13) All shares are owned by Kjell H. Qvale Survivors Trust.
(14) Mr. Stanberry's Series A Preferred shares include 25,000 shares owned by
his IRA account.
(15) Mr. Nickoloff's Series A Preferred shares include 25,000 shares owned by
his IRA account.
PROPOSAL I
ELECTION OF DIRECTORS
The Company's Bylaws provide that the number of directors shall be fixed from
time to time by resolution of the Board of Directors, but in no instance shall
there be less than one director. All directors shall be elected at the annual
meeting of shareholders to serve two-year terms and shall hold office until his
or her successor shall have been elected and qualified. Currently we have five
directors, three of whom have been nominated for re-election this year and have
agreed to serve if elected. A fourth director has been nominated to fill a
vacancy, the term of which expires at the 2007 Annual Meeting of Shareholders or
at such time as a replacement director has been elected and qualified to hold
this office. The Board of Directors set these terms staggered in order to
maintain continuity on the Board of Directors. In order to affect this staggered
term strategy, the five board seats are numbered consecutively, 1 through 5. Odd
numbered seats (seats 1, 3 and 5) will be elected at the annual shareholder
meetings held on even numbered years; even numbered seats (seats 2 and 4) will
be elected at the annual shareholder meetings held on odd numbered years. The
following are Company directors, the director seats and terms for which they
were elected or appointed: o Director Seat #1, William J. Clough, Esq. Mr.
William J. Clough was appointed to fill a Board vacancy on March 1, 2006 to
serve until the next annual meeting of shareholders. Mr. William J. Clough is
nominated for election to a two year term at the 2006 Annual Meeting of
Shareholders.
o Director Seat #2, Russell L. Wall. Mr. Russell L. Wall was elected for a
two year term at the 2005 Annual Meeting of Shareholders.
o Director Seat #3, Bradley J. Hallock. Mr. Bradley J. Hallock was elected
for a two year term at the 2004 Annual Meeting of Shareholders. Mr.
Bradley J. Hallock is nominated for election to a two year term at the
2006 Annual Meeting of Shareholders.
o Director Seat #4, Steven S. Hallock. Mr. Steven S. Hallock was appointed
to fill a Board vacancy on August 26, 2006 to serve until the next annual
meeting of shareholders. Mr. Steven S. Hallock is nominated for election
to a one year term at the 2006 Annual Meeting of Shareholders so as to
complete the term for this board seat.
o Director Seat #5, John P. Rouse. Mr. John P. Rouse was appointed to fill a
Board vacancy on July 5, 2006 to serve until the next annual meeting of
shareholders. Mr. John P. Rouse is nominated for election to a two year
term at the 2006 Annual Meeting of Shareholders.
Shares of our Common Stock and Series A Preferred Stock are entitled to one vote
per share for each Director. Cumulative voting is not permitted.
Unless stated to be voted otherwise, each proxy will be voted for the election
of the nominees named. All of the nominees have consented to serve as directors
if elected. If a nominee becomes unavailable for election before the 2006 Annual
Meeting of Shareholders, the Board of Directors may name a substitute nominee
and proxies will be voted for such substitute nominee unless an instruction to
the contrary is written on the proxy card.
INFORMATION ABOUT NOMINEES
William J. Clough, Esq., Executive Vice President of Corporate Development,
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Corporate Secretary, General Counsel and Director
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Mr. William J. Clough was appointed to fill a Board vacancy on March 1, 2006 to
serve until the next annual meeting of shareholders. Mr. Clough was a police
officer for 16 years, working at the local, state, and federal level. In 1987
while working as a Federal Air Marshall in Southern Europe and the Middle East,
Mr. Clough decided to attend law school. He received his Juris Doctorate, cum
laude, from the University of California, Hastings College of the Law in 1990.
He operated his own law firm with offices in Los Angeles, San Francisco, and
Honolulu for 12 years. Mr. Clough obtained the largest ever non-wrongful death
jury verdict in Los Angeles County Superior Court in 2000 and successfully
represented parties in multi-million dollar cases throughout the United States.
He is certified to practice law in state and federal courts in California,
Illinois, Hawaii, and before the United States Supreme Court. Mr. Clough has
represented large manufacturing and entertainment entities, including work with
MGM Studios, 20th Century Fox, News Corp., Lions Gate Films, Artisan Pictures,
Sony, and Mediacopy.
Mr. Clough is actively employed by the Company on a daily basis. He receives an
annual salary of $180,000 and for the first year of employment will be entitled
to receive a guaranteed annual bonus of at least twenty-five percent (25%) of
his annual base salary with the potential of receiving up to fifty percent (50%)
of his annual base salary based upon performance. During subsequent years, Mr.
Clough shall receive a minimum annual bonus of at least fifteen percent (15%) of
his base annual salary with the potential of receiving up to twenty-five percent
(25%) of his annual base salary based upon performance. Mr. Clough will be
reimbursed for all company expenses related to travel, entertainment, health
insurance, vehicle use and lodging.
William J. Clough owns 4,951,089 shares of Company stock
William J. Clough, Esq. is nominated for election to a two year term at the 2006
Annual Meeting of Shareholders.
Bradley J. Hallock, Director
----------------------------
Bradley J. Hallock was elected for a two year term at the 2004 Annual Meeting of
Shareholders. Mr. Hallock, age 47, was appointed to the Board of Directors in
April 2004 and was elected at the June 2004 shareholders' meeting to serve an
additional two year term. Mr. Hallock brings to the board over 25 years of
corporate experience. Mr. Hallock was the founder and Chief Executive Officer of
C and R, Ltd., a provider of wholesale services to the automobile industry, with
annual revenue in excess of $10,000,000. For three years, Mr. Hallock served as
a Senior Executive for First America Automotive, Inc. (FAA), an $800,000,000
annual revenue company that was later acquired by Sonic Automotive, Inc.
(NYSE:SAH). As a Senior Executive at FAA, he conceived and implemented the "Auto
Factory" concept to vertically integrate used car operations across disparate
retail franchises on a regional basis. He led the expansion of this concept into
a $100,000,000 annual revenue division of FAA resulting with industry leading
profitability. During his tenure at FAA, Mr. Hallock was a key member of the
merger and acquisition team, where he was instrumental in the successful
acquisition and integration of over 50 new car retail franchises.
Bradley J. Hallock owns 9,684,540 shares of Company stock.
Bradley J. Hallock is nominated for election to a two year term at the 2006
Annual Meeting of Shareholders.
Steven S. Hallock, Director
---------------------------
Steven S. Hallock was appointed to fill a Board vacancy on August 26, 2006 to
serve until the next annual meeting of shareholders. Mr. Hallock is the
President of Fremont Ford/Mazda an automobile dealership generating $80,000,000
in annual revenue. Additionally, he functions as a corporate trainer for Sonic
Automotive, a Fortune 300 company and was one of the architects of their
industry leading training program. Prior to his present position, Mr. Hallock
was the Northern California Regional Vice President in charge of 22 Automotive
Dealerships generating over 1 billion in annual revenues. In his prior role, Mr.
Hallock was the Chief Operating Officer for First America Automotive, an
automotive company comprised of 26 automobile dealerships in California. Mr.
Hallock started his automotive career as a general manager and partner in the HG
Automotive group, a group of automobile dealerships operating in Northern
California generating $250 million in annual revenues. Mr. Hallock graduated Cum
Laude from Pepperdine Law School in 1981. Mr. Hallock has served as chairperson
of the OnScreen Technologies, Inc. Business Advisory Board since March 2006.
Steven S. Hallock owns 8,124,627 shares of Company stock and a warrant to
purchase 100,000 additional common shares.
Steven S. Hallock is nominated for election to a one year term at the 2006
Annual Meeting of Shareholders so as to complete the term for this board seat.
John P. Rouse, Director
-----------------------
John P. Rouse was appointed to the Board of Directors, effective March 17, 2006
to serve until the next annual meeting of shareholders. Mr. Rouse brings to the
board 30 years of business management experience. For the last 17 years Mr.
Rouse has been the President/Owner/Founder of Washington Equipment Manufacturing
Company, Inc. (WEMCO), located in the State of Washington. WEMCO is a
multi-million dollar manufacturing company. As its Founder, Mr. Rouse was
personally responsible for setting up the engineering, manufacturing and
financial aspects of WEMCO and continues to run the daily operations. Prior to
founding WEMCO, Mr. Rouse spent 12 years as equipment and operations manager for
DHH Investments and its subsidiary companies, Acme Concrete, Acme Concrete
Construction Division, Acme Concrete Asphalt Division, Acme Concrete Ready Mix
in Richland, WA, Yakima Concrete and Asphalt Company and Cunningham Sand, Gravel
and Asphalt. The Construction and Asphalt Divisions operated in most of the
Western United States and the Concrete Division was one of the largest users of
cement in the United States. As a member of DHH's Executive Committee, Mr. Rouse
was responsible for daily operations and financial/budgeting.
John P. Rouse owns 6,166,505 shares of Company stock.
John P. Rouse is nominated for election to a two year term at the 2006 Annual
Meeting of Shareholders.
The Board of Directors recommends that shareholders vote "FOR" election of the
nominees for director named above.
OTHER BUSINESS
Management does not presently know of any matters that may be presented for
action at the Annual Meeting other than those set forth herein. However, if any
other matters properly come before the Annual Meeting, it is the intention of
the persons named in the proxies solicited by management to exercise their
discretionary authority to vote the shares represented by all effective proxies
on such matters in accordance with their best judgment.
If you do not expect to be personally present at the Annual Meeting, please fill
in, date and sign the enclosed proxy card and return it promptly in the enclosed
return envelope which requires no additional postage if mailed in the United
States.
COMMITTEES OF THE BOARD AND MEETINGS
During the fiscal year ended December 31, 2005, the Board of Directors held a
total of 25 meetings (including regularly scheduled and special meetings) of
which the Board took action 22 times by unanimous written consent. Those
directors who were on the Board at the time of the 2005 meetings attended all of
the meetings of the Board held in 2005. The Board of Directors has two standing
committees: Audit Committee and Compensation Committee. No incumbent director
attended fewer than 100% of the total number of meetings held by all committees
on which such director served.
Our board currently appoints the members of the audit and compensation
committees. Each member of the audit and compensation committees is an
independent director in accordance with NASDAQ standards (although the Company
is not currently listed on the NASDAQ, but has its securities traded on the Over
the Counter Bulletin Board). Each of our board committees has a written charter
approved by our board. Copies of the current committee charters for each
committee are posted on our website at www.onscreentech.com.
--------------------
Audit Committee
The purpose of the Audit Committee is to oversee the Company's accounting and
financial reporting processes and the audits of its financial statements. The
functions of the Audit Committee and its activities during fiscal year 2005 are
described below under the heading "Report of the Audit Committee". The Audit
Committee is directly responsible for, among other things, the appointment,
compensation, retention and oversight of our independent Registered Public
Accounting firm. Our Audit Committee acts pursuant to a written charter, a copy
of which is available from the Company and is posted on our website at
www.onscreentech.com.
---------------------
The Audit Committee is currently composed of our Board of Directors. Russell L.
Wall is the committee chairman. Mr. Wall is independent in accordance with
applicable rules promulgated by the Securities and Exchange Commission (the
"SEC") and NASDAQ listing standards. Mr. Wall is able to read and understand
fundamental financial statements, including our balance sheet, income statement
and cash flow statement. The Board of Directors has determined that Mr. Wall is
an "audit committee financial expert" as defined in Section 401(h) of Regulation
S-K promulgated by the SEC under the Exchange Act. During the last fiscal year,
there were four meetings of the Audit Committee.
Compensation Committee
The Compensation Committee, subject to existing contractual obligations, is
responsible for setting and administering the policies that govern executive
compensation and the granting of employee stock options. The Compensation
Committee met four times and acted four times by unanimous consent during fiscal
2005. The current members of the Compensation committee are Messrs. Russell L.
Wall and Bradley J. Hallock.
The Compensation Committee acts pursuant to a written charter a copy of which is
available from the Company and is posted on our website at www.onscreentech.com.
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REPORT OF THE AUDIT COMMITTEE
THE FOLLOWING REPORT OF THE AUDIT COMMITTEE DOES NOT CONSTITUTE SOLICITING
MATERIAL AND SHOULD NOT BE DEEMED FILED OR INCORPORATED BY REFERENCE INTO ANY
OTHER COMPANY FILING UNDER THE SECURITIES ACT OF 1933 OR THE SECURITIES EXCHANGE
ACT OF 1934, EXCEPT TO THE EXTENT THE COMPANY SPECIFICALLY INCORPORATES THIS
REPORT BY REFERENCE THEREIN.
The Audit Committee reviewed and discussed the Company's December 31, 2005
audited financial statements with the Company's management and with Salberg &
Company, P.A., our independent Registered Public Accounting firm for our 2005
financial statements, the matters required to be discussed by the Statement on
Auditing Standards No. 61 (Communication with Audit Committees).
The audit committee has received written disclosures and a letter from Salberg &
Company, P.A. as required by the Independence Standards Board Standard No. 1,
Independence Discussions with Audit Committees, and the committee discussed the
issue of auditor independence with Salberg & Company, P.A.
Based on this review and these discussions, we recommended to the board of
directors that these audited financial statements shall be included in our
Annual Report on Form 10-KSB for the fiscal year ended December 31, 2005.
Salberg & Company, P.A. did not provide any services other than annual audits
and quarterly reviews.
OnScreen Technologies, Inc.
Audit Committee
By: /s/ Russell L. Wall
-----------------------------
Russell L. Wall, Chairman
Independent Registered Public Accounting Firm
Salberg & Company, P.A. has audited the Company's financial statements since
2002. Representatives of Salberg & Company, P.A. will be present via
teleconference at the Annual Meeting. They will have an opportunity to make a
statement if they so desire and will be available to respond to appropriate
questions.
Compensation of Independent Registered Public Accounting Firm
The financial statements of the Company, which are furnished herewith as of
December 31, 2005, have been audited by Salberg & Company, P.A., Boca Raton,
Florida, Independent Registered Public Accounting Firm. Salberg & Company, P.A.
billed the Company an aggregate of $54,000 in fees and expenses for professional
services rendered in connection with the audit of the Company's financial
statements for the fiscal year ended December 31, 2005 and the reviews of the
financial statements included in each of the Company's Quarterly Reports on Form
10-QSB during the fiscal year ended December 31, 2005. Salberg & Company, P.A.
billed the Company an aggregate of $50,000 in fees and expenses for professional
services rendered in connection with the audit of the Company's financial
statements for the fiscal year ended December 31, 2004 and the reviews of the
financial statements included in each of the Company's Quarterly Reports on Form
10-QSB during the fiscal year ended December 31, 2004. Audit related fees for
2005 were $0 and for 2004 were $0. The Company paid these sums.
All fees described above were approved by the Audit Committee prior to
engagement of the auditor to perform the service. None of the services provided
above were pre-approved pursuant to the "de minimis exception" to the
requirements of pre-approval for permitted non-audit services, set forth in Rule
2-01 of SEC Regulation S-X.
Pre-approval Policies and Procedures
The Audit Committee pre-approves the audit and non-audit services rendered by
Salberg & Company, P.A. Generally, the Committee pre-approves particular
services in the defined categories of audit services, audit-related services,
tax services and other non-audit services, specifying the maximum fee payable
with respect to that service. Pre-approval may be given as part of the Audit
Committee's approval of the scope of the engagement of the independent auditor
or on an individual explicit case-by-case basis before the independent auditor
is engaged to provide each service.
REPORT OF THE COMPENSATION COMMITTEE
The compensation committee of the Board of Directors administers our executive
and management compensation program. The current members of the compensation
committee are Russell L. Wall and Bradley J. Hallock. Each of these persons is a
non-employee director within the meaning of Section 16 of the Securities
Exchange Act of 1934, as amended, and an "outside director" within the meaning
of Section 162(m) of the Internal Revenue Code. The Board has determined that
each said member is "independent" within the meaning of NASDAQ's rules. Neither
of Messrs. Wall and Hallock has any interlocking relationships as defined by the
rules promulgated by the SEC.
General Compensation Philosophy
The role of the compensation committee is to set the salaries and other
compensation of the executive officers and certain other key employees of
OnScreen Technologies, Inc. and to make grants under, and to administer, the
stock option and other employee equity and bonus plans. The compensation
philosophy of OnScreen Technologies, Inc. for executive officers is to relate
compensation to corporate performance and increases in stockholder value, while
providing a total compensation package that is competitive and enables OnScreen
Technologies, Inc. to attract, motivate, reward and retain key executives and
employees. Accordingly, each executive officer's compensation package included
in the executive's contract of employment may be comprised of the following
three elements:
o base salary that is designed primarily to be competitive with base
salary levels in effect at technology companies in similar locations
that are of comparable size to OnScreen Technologies, Inc. and with
which OnScreen Technologies, Inc. competes for executive personnel;
o annual variable performance awards, such as bonuses, payable in cash
and tied to the achievement of performance goals, financial or
otherwise, established by the compensation committee; and
o long term stock-based incentive awards which strengthen the mutuality
of interests between the executive officers and the shareholders of
OnScreen Technologies, Inc.
Executive Compensation
Base Salary. Salaries for executive officers for 2005 were generally determined
on an individual basis by evaluating each executive's scope of responsibility,
performance, prior experience and salary history, as well as the salaries for
similar positions in similar locations at comparable companies. In addition,
OnScreen Technologies, Inc.'s Human Resources Department provided information to
us regarding salary range guidelines for specific positions.
As permitted by contract, base salary is adjusted each year to take into account
the executive officer's performance and to maintain a competitive salary
structure. We conduct reviews of executive compensation practices on an annual
basis and may change each executive officer's salary based on the individual's
contributions and responsibilities over the prior twelve months and any change
in median comparable company pay levels. We believe that, on the basis of our
knowledge of executive compensation in the industry, that salary levels of
OnScreen Technologies, Inc. for the executive officers are reasonable and
necessary given the competition for executive talent in the industry and the
financial resources of OnScreen Technologies, Inc.
Long Term Incentive Awards. We believe that equity-based compensation in the
form of stock options links the interests of executive officers with the
long-term interests of the stockholders of OnScreen Technologies, Inc. and
encourages executive officers to remain in the employ of OnScreen Technologies,
Inc. Stock options, generally, have value for executive officers only if the
price of the stock increases above the exercise price on the grant date and the
officer remains in the employ of OnScreen Technologies, Inc. for the period
required for the shares to vest.
It is the design of OnScreen Technologies, Inc. that stock options may be
granted to executive officers when the executive first joins OnScreen
Technologies, Inc., in connection with a significant change in responsibilities
and, occasionally, to achieve equity within a peer group. We may, however, grant
additional stock options to executive officers for other reasons. The number of
shares subject to each stock option granted is within our discretion and is
based on anticipated future contribution and ability to impact results, past
performance or consistency within the executive officer's peer group. We may
grant stock options to executives and officers to provide greater incentives to
continue their employment with OnScreen Technologies, Inc. and to strive to
increase the value of OnScreen Technologies, Inc.'s common stock. The stock
options generally become exercisable over a three-year period and are granted at
a price that is equal to the fair market value of OnScreen Technologies, Inc.'s
common stock on the date of grant.
The total compensation philosophy of OnScreen Technologies, Inc. is based on the
concept that variable pay is earned through effective performance and
contribution to the success of the company. Bonus payments are based on actual
performance in achieving corporate, department and individual targets. The
Compensation Committee determines weightings for each element and establishes
the corporate financial goals for bonus measurement purposes. The Compensation
Committee is responsible for ensuring that actual results are confirmed before
they are applied against the bonus plan for payment purposes. The corporate
target is
based on OnScreen Technologies, Inc.'s earnings per share, total consolidated
revenue, and success in managing corporate expenses to plan. All targets and
objectives are aligned with the business plan for the fiscal year and monitored
by the corporate finance department of OnScreen Technologies, Inc. Individual
performance is measured relative to the individual's personal contribution to
the success of the organization. This element is objective and tied to
individual documented objectives for the bonus year. All targets and related
objectives are defined and measured periodically, with a final annual
measurement.
OnScreen Technologies, Inc.
Compensation Committee
By: /s/ Bradley J. Hallock
-----------------------------------
Bradley J. Hallock
/s/ Russell L. Wall
-----------------------------------
Russell L. Wall
Executive Compensation
The following tables list the cash and option grant remuneration paid or accrued
and option exercises during 2003, 2004 and 2005 to our officers, executives and
directors who received compensation of $100,000 or more in 2003, 2004 and 2005.
--------------------------------------------------------------------------------------------------------------------------------
SUMMARY COMPENSATION TABLE
--------------------------------------------------------------------------------------------------------------------------------
Long Term Compensation
--------------------------------------------------------------------------------------------------------------------------------
Annual Compensation Awards Payouts
--------------------- ------- ------------------------------------- --------------------------------- ---------- ---------------
(a) (b) (c) (d) (e) (f) (g) (h) (i)
--------------------- ------- ----------- ------ ------------------ ------------ ---- --------------- ---------- ---------------
Securities
Name and Principle Year Salary ($) Bonus Other Annual Restricted Underlying Payouts All Other
Stock Options/ SARs Compensation
Position ($) Compensation ($) Award(s) (#) ($) ($)
--------------------- ------- ----------- ------ ------------------ ------------ ---- --------------- ---------- ---------------
Charles Baker, 2005 125,480 - - - 2,000,000 - -
Chairman/CEO/ 2004 - - - - - - -
President (1) 2003 - - - - - - -
--------------------- ------- ----------- ------ ------------------ ------------ ---- --------------- ---------- ---------------
Mark Chandler 2005 180,000 - - 240,000 (2) - - -
CFO 2004 155,000 - - 120,000 (2) 600,000 - -
2003 - - - - - - -
--------------------- ------- ----------- ------ ------------------ ------------ ---- --------------- ---------- ---------------
William Clough, 2005 62,308 - 4,000 - - - -
EVP Corp. Dev., 2004 - - - - - - -
Corp Sec. (3) 2003 - - - - - - -
--------------------- ------- ----------- ------ ------------------ ------------ ---- --------------- ---------- ---------------
John Thatch, 2005 180,000 - 4,139 600,000 - - 15,000 (4)
Dir. Govt. Sales 2004 155,000 - 10,000 1,666,312 - - -
Prior CEO 2003 140,000 - 10,000 311,777 - - -
--------------------- ------- ----------- ------ ------------------ ------------ ---- --------------- ---------- ---------------
(1) Mr. Baker joined the Company on June 13, 2005 and left the Company August
28, 2006.
(2) Mr. Chandler was issued 240,000 shares of the Company's Series A
Convertible Preferred Stock during 2005 and 120,000 shares of the
company's Series A Convertible Preferred Stock during 2004.
(3) Mr. Clough joined the Company on September 1, 2005.
(4) Mr. Thatch entered into a new employment agreement which included the
return of 1,500,000 shares of common stock issued to him previously. The
Company paid him a nominal $15,000 for those shares.
OPTION GRANTS DURING FISCAL 2005
Percent of
Total
Number of Options
Securities Granted to Exercise Market
Underlying Employees in Price Per Price on
Options Fiscal Year Share Date of
Name Granted (2) ($/Sh) Grant Expiration Date
--------------------------- -------------- ---- --------------- ----------- ---------- ------------------------
Charles Baker 2,000,000 (1) 79% $0.01 $0.21 December 5, 2010
(1) The options granted to Mr. Baker were fully vested on the grant date.
(2) During the year ended December 31, 2005, OnScreen granted employees
options to purchase 2,547,500 shares of common stock.
AGGREGATED OPTION EXERCISES DURING FISCAL 2005
AND
FISCAL 2005 YEAR-END OPTION VALUES
The following table shows the number of shares underlying both exercisable and
unexercisable stock options held by the executive officers named in the Summary
Compensation Table as of the year ended December 31, 2005, and the values for
exercisable and unexercisable options:
Number of Securities Value of Unexercised
Underlying Unexercised In-The-Money Options at December
Options at December 31, 2005 31, 2005 (1)
------------------------------- -- ----------------------------------
Name Shares Acquired Value
on Exercise (#) Realized ($) Exercisable Unexercisable Exercisable Unexercisable
--------------------- ----------------- -------------- --------------- ------------------ --------------- ------------------
Charles Baker - - 2,000,000 - $ 420,000 -
Mark Chandler - - 600,000 - - -
(1) Options are in the money if the market value per share of the shares
underlying the options is greater than the option exercise price. This
calculation is based on the fair market value at December 31, 2005 of
$0.22 per share, less the exercise price.
Director Compensation
Other than as noted above under "Information About Nominees" and as stated
below, no Director is compensated for the performance of duties in that capacity
or for his/her attendance at Director meetings.
In recognition for serving on the Company Board of Directors initially without
the benefit of officers and directors liability insurance, which service is of
benefit to the Company in connection with the Company's management and
compliance with the Sarbanes-Oxley Act of 2002, the Board of Directors
authorized issuance of a warrant to Russell L. Wall to purchase
100,000 restricted common shares at a price of $0.25 per share within 3 years
after the date of issuance. In recognition for past services as a director of
the Company, by August 23, 2004 Board of Directors resolution, the board
authorized issuance to Russell L. Wall of a warrant to purchase 600,000
restricted common shares within five years from date of issuance at a per share
price of $0.25.
In recognition for services to be rendered by Charles Baker as a member of the
Board of Directors, March 1, 2005 the Board of Directors authorized an
honorarium issuance to Charles Baker of a Warrant to purchase 100,000
Corporation common shares at any time within three years from date of issuance
at the per share price of $0.75.
EMPLOYMENT AGREEMENTS
Former CEO, President and Chairman of the Board of Directors
On June 13, 2005 Charles Baker was appointed by the Company Board of Directors
to serve as the Chairman of the Board of Directors for a term of three years. On
August 31, 2005, Charles R. Baker was appointed CEO and November 21, 2005 Mr.
Baker executed a revised three year employment agreement with the Company that
provided for a $100,000 sign on bonus, a $100,000 first year bonus, second year
and third year minimum bonus of 15% of salary, monthly salary of $22,920, five
year option to purchase 2,000,000 shares of Company stock at a price of $0.01
per share, five year stock options during the second and third years of
employment to purchase at a price of $0.01 per share, in equal installments,
Company stock such that at the end of two (2) years the optioned common shares
would equal five percent (5%) of the fully diluted common shares and was
entitled to be reimbursed for all company expenses related to travel,
entertainment, health insurance, vehicle use and lodging. August 28, 2006 Mr.
Baker relinquished his positions as director, CEO and Company President. Mr.
Baker's severance package remains undetermined.
Mr. Baker currently owns a warrant to purchase 100,000 shares of the Company's
$0.001 par value per share common stock at a price of $0.75 per share at any
time within 3 years of the March 31, 2005 date of issuance and a warrant to
purchase 2,000,000 shares of the Company's $0.001 par value common stock at a
price of $0.01 per share at any time within 5 years from issuance.
Former President/CEO
Mr. Thatch served as CEO and President from 2000 trough August 2005 at which
time Mr. Thatch relinquished his positions of CEO and President and returned to
the Company 1,500,000 shares of common stock awarded to him by the Board of
Directors on March 28, 2005. Mr. Thatch entered into a new employment agreement
which included the return of 1,500,000 shares of common stock issued to him
previously. The Company paid him a nominal $15,000 for those shares. In his
present employment capacity as Director of Government Sales, Mr. Thatch received
$180,000 annual salary through February 15, 2006 at which time the salary was
reduced to $150,000 annually until the Company supplied RediAlert(TM) signs are
ready for sale at which time the salary was reduced to $125,000 annually.
Chief Operating Officer and Chief Financial Officer
The Company executed a three-year employment agreement, effective January 1,
2004 with Mark R. Chandler, its Chief Operating Officer and Chief Financial
Officer. The terms of this agreement are as follows: (i) Base salary of $120,000
during 2004, $150,000 during 2005 and $180,000 during 2006, (ii) a sign-on bonus
for $10,000 payable before March 31, 2004 and eligible for the bonus plan as set
up by the Company, (iii) receive 120,000 shares of Series A
convertible preferred stock for each period of June 2004, January 2005 and June
2005 and (iv) receive a warrant to purchase 100,000 shares of common stock at an
exercise price of $0.25 which expires on November 30, 2006. In the event of a
change of control, the Series A Convertible Preferred stock shall immediately
accelerate and be issued within 30 days of written notice from the employee.
August 2004, the Board of Directors increased the annual salary of Mr. Chandler
to $150,000 and beginning November 1, 2004 his annual salary was increased to
$180,000.
In recognition for past services rendered, the board authorized issuance of a
warrant to Mr. Chandler for the purchase of 500,000 restricted common shares
within five years from date of issuance at a per share price of $0.25.
In recognition of continuing and additional services by Mr. Chandler, the board
authorized issuance to Mr. Chandler three hundred seventy five thousand
(375,000) Series A Convertible Preferred shares and one thousand five hundred
(1,500) Series B Convertible Preferred shares in the following increments:
125,000 Series A shares and 500 Series B shares on or about January 1, 2006;
125,000 Series A shares and 500 Series B shares on or about July 1, 2006; and
125,000 Series A shares and 500 Series B shares on or about December 31, 2006.
The said shares will be issued so long as Mr. Chandler has not terminated
employment voluntarily before the above issue date.
William J. Clough, Executive Vice President of Corporate Development and
Corporate General Counsel. Mr. Clough is certified to practice law in state and
federal courts in California, Illinois, Hawaii, and before the United States
Supreme Court. On November 21, 2005 the Company executed a three year employment
agreement with Mr. Clough wherein Mr. Clough is entitled to receive an annual
salary of $180,000, $1,000 monthly automobile allowance, as well as customary
medical insurance for himself and his family. Mr. Clough also serves as
Corporate Secretary, a non-salaried position and is a director of the Company.
President of Business Development
In May 2003, the Company executed a six-month employment agreement with Stephen
K. Velte, the President of Business Development. Mr. Velte's $10,000 monthly
salary accrued until such time the Company's technical division has sufficient
cash on hand to pay the salary or, at Mr. Velte's option the accrued salary may
be converted to common or preferred shares of the Company at the current bid
price. Mr. Velte was granted three-year warrants for 500,000 shares of the
Company's common stock at an exercise price of $0.25 per share(1); 750,000
shares at $0.35 per share(2) upon completion of Phase II prototype; 500,000
shares at $0.40 per share upon receipt by the Company of any Next Stage OnScreen
funding in excess of $150,000 and 250,000 shares at $0.50 per share upon receipt
by the Company of payment for commercial orders in excess of $200,000. During
2003, the Company issued 1,750,000 of the warrants in accordance with the
agreement. The remaining 250,000 warrants(3) were not issued at December 31,
2004, as the criteria for the shares to be issued had not been met.
Effective November 1, 2003, this agreement was extended for a three-year term.
The salary was set at $150,000 for the first year, $180,000 for the second year
and $240,000 for the third year. 450,000 shares(4) of the Company's common stock
were issued to Mr. Velte conditioned on if he is terminated for cause or
resigns, the shares may be repurchased from Mr. Velte at an annual decline
amount of 50,000 shares, resulting in the shares being fully vested on November
1, 2006.
By an August 23, 2004 Board of Directors resolution, there was issued to Mr.
Velte a warrant to purchase 2,000,000 restricted common shares(5) within five
years from date of issuance at a per share price of $0.25 conditioned on Mr.
Velte's being employed by the Company through the term of his November 2003
employment agreement. As of May 4, 2005, Mr. Velte is no longer employed with
the Company.
1 The exercise price for this 500,000 share warrant was reduced to
$0.20 per share.
2 The exercise price for 550,000 shares of this warrant was reduced to
$0.20 per share.
3 This 250,000 share warrant was cancelled.
4 150,000 of these shares were repurchased by the Company for $225.
5 This 2,000,000 share warrant was cancelled.
CODE OF ETHICS AND BUSINESS CONDUCT
The Company has adopted the OnScreen Technologies, Inc. Code of Ethics and
Business Conduct, which applies to all officers, directors and employees and a
more restrictive Code of Ethics for Principal Executive and Financial Officers.
These policies are available on our website, www.onscreentech.com. If the
Company makes any substantive amendments to these policies or grants any waiver
from the policies to any executive officer or director, the Company will
disclose the nature of the amendment or waiver on its website.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires our executive
officers, directors and persons owning more than 10% of our common stock to file
reports of ownership and reports of changes of ownership with the Securities and
Exchange Commission. These reporting persons are required to furnish us with
copies of all Section 16(a) forms that they file.
Based solely upon a review of copies of these filings received, we believe that
all filing requirements were complied with during the fiscal year ended December
31, 2004, except for the following late filings:
Form 3 was filed by Steven S. Hallock on September 21, 2006.
We have made all officers and directors aware of their reporting obligations and
have appointed an employee to oversee section 16 compliance for future filings
SHAREHOLDER PROPOSALS FOR 2007 ANNUAL MEETING
Under the Security and Exchange Commission's proxy rules, shareholder proposals
that meet certain conditions may be included in our proxy statement and form of
proxy for a particular annual meeting. Shareholders that intend to present a
proposal at our 2007 Annual Meeting must give notice of the proposal to the
Company no later than March 1, 2007 to be considered for inclusion in the proxy
statement and form of proxy relating to that meeting. In addition, if we receive
notice of a shareholder proposal after March 1, 2007, the persons named as
proxies in the proxy statement for the 2007 Annual Meeting will have
discretionary voting authority to vote on such proposal at the 2007 Annual
Meeting. Shareholders that intend to present a proposal that will not be
included in the proxy statement and form of proxy must give notice of the
proposal to us no fewer than 90 or more than 120 days prior to the one-year
anniversary date of the 2007 Annual Meeting. Our receipt of any such proposal
from a qualified shareholder in a timely manner will not guarantee its inclusion
in our proxy materials or its presentation at the 2007 Annual Meeting because
there are other requirements in the proxy rules.
ANNUAL REPORT
A COPY OF OUR ANNUAL REPORT TO STOCKHOLDERS (WHICH INCLUDES OUR ANNUAL REPORT ON
FORM 10-KSB AND FORM 10-QSB) IS BEING MAILED WITH THIS PROXY STATEMENT TO EACH
STOCKHOLDER ENTITLED TO VOTE AT THE ANNUAL MEETING. STOCKHOLDERS NOT RECEIVING A
COPY OF THE ANNUAL REPORT MAY OBTAIN ONE, WITHOUT CHARGE, BY WRITING OR CALLING
THE CORPORATE OFFICES: ONSCREEN TECHNOLOGIES, INC., 600 NW 14th AVENUE, SUITE
100, PORTLAND, OREGON 97209, (503) 417-1700, FAX (503) 417-1717.
By Order of the Board of Directors,
William J. Clough, Esq.
Corporate Secretary
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
FOR THE 2006 ANNUAL MEETING OF THE SHAREHOLDERS
December 6, 2006
The undersigned, revoking all previous proxies, appoints William J. Clough,
Esq., Corporate Secretary, attorney and proxy of the undersigned, with power of
substitution, to represent the undersigned at the Annual Meeting of Shareholders
of OnScreen Technologies, Inc. (the "Company") to be held Wednesday, December 6,
2006 at 9:00 a.m. PST in the corporate offices located at 600 NW 14th Avenue,
Suite 100, Portland, Oregon 97209 and at any adjournments thereof and to vote
all shares of Voting Stock of the Company which the undersigned is entitled to
vote on all matters coming before said meeting.
[X] Please mark your votes with an "X" as in this example.
PROPOSAL I
(ELECTION OF DIRECTORS)
Nominees: Seat #1, William J. Clough, Esq.
Seat #3, Bradley J. Hallock.
Seat #4, Steven S. Hallock.
Seat #5, John P. Rouse.
[ ] FOR ALL [ ] WITHHOLD ALL [ ] FOR ALL EXCEPT
(INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE, STRIKE A
LINE THROUGH THE NOMINEE'S NAME IN THE LIST ABOVE AND CHOOSE "FOR ALL EXCEPT")
PLEASE SIGN, DATE AND RETURN THIS PROXY CARD USING THE ENCLOSED ENVELOPE. THIS
PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED HEREIN BY THE
UNDERSIGNED SHAREHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED "FOR"
THE ELECTION OF ALL DIRECTORS AND FOR PROPOSAL 2.
Date 2006
------------------------------------
------------------------------------
Signature
------------------------------------
Signature of joint holder, if any
Please sign exactly as your name appears on your stock certificate or account.
Executors, administrators, trustees, etc. should give full title as such. If the
signer is a corporation, please sign full corporate name by a duly authorized
officer. If a partnership, please sign in partnership name by authorized person.