PHRM.L Regulatory News (PHRM)

2 Apr 2007 07:02

121Media Inc02 April 2007 Embargoed for release until 7.00 a.m., 2/4/07 2 April 2007 121Media, Inc. ('121Media' or the 'Company') Notice of AGM and Shareholder Proxy Statement 121Media (AIM: OTO and OTOM), a market leader in the field of behavioural andcontextual online advertising, today announces it will hold its annual generalmeeting (AGM) at 11 a.m., 26 April, 2007, at the Company's offices at GoldenCross House, 8 Duncannon Street, London WC2N 4JF. The proxy statement outlining details of the AGM will be posted to shareholderstoday and will be available after 8.00 a.m., on the Company website today:www.121media.com. Full details are set out in the Appendix below. For Enquiries121 Media, Inc. +44 870 405 7722Kent Ertugrul (Chief Executive) Edelman Financial PR +44 20 7344 1325Paul Lockstone +44 7876 685200Sorrel Beynon +44 20 7344 1253 +44 7980 687 255 Canaccord Adams Limited +44 20 7050 6500Nominated AdviserMark Williams +44 20 7050 6758 Appendix: Proxy Statement 121MEDIA, INC. Golden Cross House 8 Duncannon Street London WC2N 4JF 0870 405 7722 March 30, 2007 Dear Stockholder: You are cordially invited to attend the 2007 annual general meeting ofstockholders of 121Media, Inc. to be held at 11:00 a.m. April 26, 2007, at ouroffices at Golden Cross House, 8 Duncannon Street, London WC2N 4JF. At the meeting you will be asked to elect two directors, approve the amendmentof our Amended and Restated Certificate of Incorporation, as amended, ratify ourappointment of H.W. Fisher & Company as our auditors for the fiscal year endingDecember 31, 2007, and to transact any and all other business that may properlycome before the meeting or any adjournment(s) thereof. In addition, we will bepleased to report on our affairs and a discussion period will be provided forquestions and comments of general interest to stockholders. For your information and following the passing of the stockholder resolutions,after the annual general meeting and the filing of the proposed amendment to ourCertificate of Incorporation, we intend to reorganize so that we become thedirect wholly-owned subsidiary of a newly formed Delaware corporation to benamed Phorm, Inc. ("Phorm"). The reorganization shall be implemented by means ofa merger of Phorm's wholly-owned subsidiary with and into us pursuant to Section251(g) of the Delaware General Corporation Law. No stockholder approval isrequired to effect this merger. Furthermore, as a result of the proposed amendment to our Certificate ofIncorporation eliminating Article VII, we need not make an offer to purchase theshares of you and our other shareholders in connection with the reorganization.The proposed amendment to our Certificate of Incorporation requires theaffirmative vote of 75% of our shares voting on this matter and the affirmativevote of a majority our outstanding shares.After the reorganization, you and our other stockholders will be the sole ownersof Phorm and hold the same amount and proportion of the outstanding capitalstock of Phorm as you and they currently hold of our capital stock. Phorm willbecome our new parent, owning all of our outstanding securities. The certificateof incorporation and bylaws of Phorm will be substantially identical to ourAmended and Restated Certificate of Incorporation, as amended by the proposedamendment, and our directors will become or remain directors of Phorm. Following the reorganization, our business will operate under the Phorm name,and our name will be changed to Phorm UK, Inc. At the effective time of themerger, our common stock will be delisted from the AIM market of the LondonStock Exchange plc and the common stock of Phorm that you receive in the mergerwill be listed on the AIM market in accordance with our reorganization andsubject to any securities law restrictions currently applicable to our commonstock. After the merger, your stock certificates of 121Media, Inc. willrepresent shares of Phorm, Inc. We look forward to greeting personally those stockholders who are able to bepresent at the meeting. However, whether or not you plan to be with us at themeeting, it is important that your shares be represented. Accordingly, you arerequested to sign and date the enclosed proxy and mail it in the envelopeprovided at your earliest convenience. Thank you for your cooperation. Very truly yours,Kent ErtugrulDirector and Chief Executive Officer 121MEDIA, INC. NOTICE OF ANNUAL GENERAL MEETING OF STOCKHOLDERS The 2007 annual general meeting of stockholders of 121Media, Inc. will be heldon April 26, 2007 at 11:00 a.m. at our offices at Golden Cross House, 8Duncannon Street, London WC2N 4JF for the following purposes: (1) To elect Gerard Baz as a Class I director and Kent Ertugrul as a Class IIdirector; (2) To approve the amendment of our Amended and Restated Certificate ofIncorporation, as amended; (3) To ratify the appointment of H.W. Fisher & Company as our auditors for thefiscal year ending December 31, 2007; and, (4) To transact such other business as may properly come before the meeting orany postponement or adjournment thereof. All stockholders of record at the close of business on March 29, 2007 will beentitled to notice of and to vote at the meeting or any postponements oradjournments of the meeting. A list of stockholders eligible to vote at themeeting will be available for inspection at the meeting and for a period of tendays prior to the meeting during regular business hours at our offices at GoldenCross House, 8 Duncannon Street, London WC2N 4JF. You are cordially invited to attend the meeting in person. If you are unable toattend the meeting in person please complete and date the enclosed form of proxyand return it promptly in the envelope provided. If you attend the meeting youmay revoke your proxy and vote your shares in person. Kent Ertugrul Director and Chief Executive Officer London, EnglandMarch 30, 2007 121MEDIA, INC. Golden Cross House 8 Duncannon Street London WC2N 4JF PROXY STATEMENT This proxy statement contains information relating to the annual general meetingof stockholders of 121Media, Inc. to be held on April 26, 2007, beginning at 11:00 a.m. at our offices at Golden Cross House, 8 Duncannon Street, London WC2N4JF, and at any postponements or adjournments thereof. ABOUT THE MEETING What is the purpose of the annual general meeting? At our annual general meeting, stockholders will act upon the matters outlinedin the notice of meeting on the cover page of this proxy statement, consistingof the election of two directors, the approval of the amendment of our Amendedand Restated Certificate of Incorporation, as amended, the ratification of theappointment of H.W. Fisher & Company as our auditors for the fiscal year endingDecember 31, 2007, and such other business that may properly come before themeeting. In addition, management will report on our performance and respond toquestions from stockholders. The Board of Directors is not currently aware ofany other matters which will come before the meeting. Proxies in the form attached as Appendix A to this proxy statement for use atthe meeting are being solicited by the Board of Directors. Proxies shall bemailed to stockholders on or about April 2, 2007. How do proxies work? The Board of Directors is asking for your proxy. Giving us your proxy means thatyou authorize us to vote your shares at the annual general meeting in the manneryou direct. You may vote for all, some, or none of our board of directorcandidates. You may vote for or against the amendment of our Amended andRestated Certificate of Incorporation, as amended. You may also vote for oragainst the ratification of our selection of H.W. Fisher & Company as ourauditors for the fiscal year ending December 31, 2007. Who is entitled to vote at the meeting? Only stockholders of record at the close of business on March 29, 2007, therecord date for the meeting, are entitled to receive notice of and toparticipate in the annual general meeting, or any postponements and adjournmentsthereof. If you were a stockholder of record on that date, you will be entitledto vote all of the shares you held on that date at the meeting, or anypostponements or adjournments of the meeting. What are the voting rights of our stockholders? On March 29, 2007, there were 11,386,450 shares of common stock outstanding.Each outstanding share of common stock is entitled to one vote on each of thematters presented at the annual meeting or adjournments thereof. How do I vote? You may vote in person at the meeting or by using the enclosed proxy card. TheBoard of Directors recommends that you vote by proxy even if you plan to attendthe meeting. If you are a "street name" stockholder and wish to vote at themeeting, you will need to obtain a proxy form from the institution that holdsyour shares. What are the Board of Directors' recommendations?If you sign and return the enclosed proxy card but do not specify how to vote,we will vote your shares in favour of our director nominees, the amendment ofour Amended and Restated Certificate of Incorporation, as amended, and theratification of H.W. Fisher & Company as our auditors for the fiscal year endingDecember 31, 2007. If any other matters are properly presented for considerationat the meeting, the individuals named as proxies on the enclosed proxy card willvote the shares that they represent on those matters as recommended by the Boardof Directors. If the Board does not make a recommendation, then they will votein accordance with their best judgment. In summary, the Board of Directorsrecommends a vote: • to approve Proposal No. 1, for election of the nominated directors; • to approve Proposal No. 2, for the amendment of our Amended and RestatedCertificate of Incorporation, as amended; and • to approve Proposal No. 3, for ratification of the appointment of H.W.Fisher & Company as our auditors for the fiscal year ending December 31, 2007. Stockholders are urged to complete, sign, date and return the enclosed proxy inthe envelope provided. In order to avoid unnecessary expense, we ask yourcooperation in mailing your proxy promptly. PROPOSAL NO. 1-ELECTION OF DIRECTORS We are nominating two directors. Our Board of Directors is divided into threeclasses. Gerard Baz shall be nominated for election at the annual generalmeeting of stockholders as a Class I director and Kent Ertugrul shall benominated for election as a Class II director. Immediately following the annualgeneral meeting, we will have no Class III directors. The term of our Class I director(s) shall expire in 2008, our two Class IIdirector(s) shall expire in 2009, and our Class III director(s) shall expire in2010. At each succeeding annual general meeting of stockholders, successors tothe class of directors whose term expires at that annual general meeting ofstockholders will be elected for a three year term. Each director will holdoffice until his successor is elected or appointed or until his earlierresignation or removal. After the annual general meeting, we intend to reorganize so that we become thedirect wholly-owned subsidiary of a newly formed Delaware corporation to benamed Phorm, Inc. ("Phorm"), by means of a merger of Phorm's wholly-ownedDelaware corporation subsidiary with and into us pursuant to Section 251(g) ofthe Delaware General Corporation Law. Pursuant to Section 251(g), this mergerdoes not require a stockholder vote to effect this type of reorganization.Immediately after the merger, you and our other stockholders will be the soleowners of Phorm and hold the same amount and proportion of the outstandingcapital stock of Phorm, as you and they hold of our capital stock immediatelyprior to the merger, Phorm will become our parent company, Phorm's capital stockshall be listed on AIM and Phorm's directors shall be Kent Ertugrul as a ClassII Director and Gerard Baz as a Class I Director if Proposal 1 is approved. Unless otherwise specified, the enclosed proxy will be voted in favour of thepersons named below to serve until the expiration of their term and until theirsuccessors are duly elected and qualified. Should one or more of these nomineesbe unable to accept nomination or election as a director, the individuals namedas proxies on the enclosed proxy card will vote the shares that they representfor such other persons as the Board of Directors may recommend. The Board ofDirectors has no present knowledge that any of the persons named will beunavailable to serve. Following the merger, Phorm intends to replace ourexisting directors with senior executives residing in our UK offices. Set forth below is information concerning each nominee for director. Director Nominees Age Position Gerard Baz 47 Class I DirectorKent Ertugrul 43 Class II Director and Chief Executive Officer Certain biographical information about each of these individuals is set forthbelow. Kent Ertugrul has worked as an international entrepreneur directly involved inthe financial and technology industries for more than 15 years. After inductionin JP Morgan's management training programme he joined Credit Suisse FirstBoston and then Morgan Stanley in London. He then oversaw, as director and chieffinancial officer, the growth of Compass Technology from 5 to 170 employees. Asit became a leading PC-based voice mail company in the US, Compass merged in1991 with Milpitas, which in turn was later acquired by Lucent Technology. Kentthen began to focus on Russia where, in addition to working on artificialintelligence based trading systems and setting up a debt arbitrage partnershipwith GML in London, he founded Migs Etc., a joint venture with the Russian AirForce and the Russian Space Agency which offered joy rides to tourists in Mig-29jet fighters, as well as micro-gravity flights to civilians. Prior to startingPeopleOnPage, Kent founded Life.com, a desktop software and online interactivediary, as well as Voxster, a company enabling Instant Messaging for email.Gerard Baz, spent 11 years at Microsoft Corporation in Redmond, Washington,where he held several positions. Most notably, he headed the Microsoft Wordprogram management group for several years with overall responsibility forproduct design and project management for all versions of Word. Later, he joinedthe newly created MSN group to be in charge of business development andrelations with content providers, before moving to Paris to prepare the Europeanlaunch of MSN in the major European markets. An angel investor since 1998, hehas invested in several European and US based internet and high technologyventures. He received a degree from Ecole Centrale de Paris in 1982 and an MS inComputer Science from Columbia University in 1984. Vote Required The nominee for Class I Director and Class II Director who receive the highestnumber of affirmative votes of the shares present in person or represented byproxy and entitled to vote, a quorum being present, shall be elected as ourdirectors for such class. Upon the execution and return of the enclosed form ofproxy, the shares represented thereby will be voted in accordance with the termsof the proxy, unless the proxy is revoked. In the absence of instructions to thecontrary, the shares represented thereby will be voted "FOR" all the nomineesset forth above. The Board of Directors recommends a vote "FOR" the election of these nominees asdirectors. PROPOSAL NUMBER 2 TO APPROVE THE AMENDMENT OF OUR AMENDED AND RESTATED CERTIFICATE OF INCORPORATION At the annual general meeting, stockholders will be asked to approve theamendment (the "Amendment") of our Amended and Restated Certificate ofIncorporation, as amended to date (the "Current Certificate", and as amended bythe Amendment, the "Amended Certificate") as set forth in the Certificate ofAmendmentof the Current Certificate attached as Appendix Bto this proxystatement (the "Certificate of Amendment"). On March 5, 2007, the Board ofDirectors adopted resolutions declaring the Amendment advisable and in our bestinterests, approving the Amendment, and directing that the Amendment beconsidered at the annual general meeting of stockholders. The purpose of the Amendment is generally to amend the Current Certificate tochange our name, increase our authorized shares of common stock and modify ourCertificate of Incorporation so it contains provisions more customary forDelaware corporations. Specifically, the changes the Amendment would make to theCurrent Certificate are for the purposes described briefly below. However, thedescription below is qualified in its entirety by reference to the actualCertificate of Amendment. Changing our name. The Amended Certificate would provide that our name is Phorm, Inc. Increasing the number of authorized shares of our common stock from 13 millionto 20 million shares. The Current Certificate authorizes 13 million shares of common stock. As ofMarch 29, 2006, there were 11,386,450 shares of our common stock issued andoutstanding. We currently have commitments to issue an aggregate ofapproximately 2,680,429 additional shares of common stock upon exercise ofoutstanding options to purchase common stock granted pursuant to our 2003 StockIncentive Plan and approximately 31,473 outstanding warrants. As a result, aprincipal reason for increasing our authorized shares of common stock is toprovide that sufficient authorized shares are available for issuance uponexercise of these outstanding options, and any additional options granted by ourBoard of Directors in accordance with such Plan. The additional authorizedshares may also be used by us for such purposes in our best interests asdetermined by our Board of Directors from time to time. The Board of Directorsbelieves that the proposed increase is necessary to provide us with theflexibility to pursue opportunities without added delay or expense. Theadditional shares of authorized common stock could be issued for any propercorporate purpose including, without limitation, raising additional capital,acquiring other companies, businesses, products or services, a stock split orstock dividend, or attracting and retaining employees by the issuance ofadditional securities under our equity compensation plans. Any future issuancesmay be authorized by the Board of Directors without any further action bystockholders, except as required by Delaware law or stock exchange rules. Upon issuance, the additional shares of authorized common stock would haverights identical to the shares of common stock currently outstanding. Approvalof the additional authorized shares would not have any immediate dilutive effecton the proportionate voting power or other rights of existing stockholders. Providing that the bylaws may be adopted, amended or repealed by the Board ofDirectors The Current Certificate provides that our bylaws may only be adopted, altered oramended by seventy-five percent (75%) of votes cast. The Amended Certificateprovides that our bylaws may be adopted, amended or repealed by the Board ofDirectors. We believe this provision, which provides much greater flexibility toour Board of Directors with respect to modifications of our bylaws, is currentlymore customary for public Delaware corporations than the provision in theCurrent Certificate. Based on our conversation with potential directors, webelieve it is important for us to have a customary Delaware Certificate ofIncorporation in order for us to attract and retain the services of qualifiedindividuals to serve as directors and attract investors. Also, this provision,taken together with the applicable provisions of the Delaware GeneralCorporation Law, would also allow our stockholders greater flexibility to adopt,amend or repeal the bylaws with a majority (rather than seventy-five percent(75%), as is the case under the Current Certificate) of votes cast. If the Amendment is approved by our stockholders, we intend to recommend to theBoard of Directors that they amend our bylaws so they are more consistent withcurrent customary bylaws of public Delaware corporations. Providing for customary indemnification of our directors, officers, employeesand agents. The Current Certificate does not require us to indemnify our current and formerdirectors and officers. Indemnification is provided for in our bylaws. TheAmended Certificate would provide indemnification for our current and formerdirectors and officers and expands on the indemnification currently provided forin Section 37 of our bylaws. Section 37 of our bylaws requires us to indemnifyeach person who serves or served as our director or officer against allexpenses, liability and loss from any lawsuit or other legal proceeding inconnection with service as our director or officer, or service as a director orofficer of another company at our request. The provisions of the AmendedCertificate expands upon this indemnification by also requiring us to indemnifyeach person who serves or served as our director or officer against allexpenses, liability and loss from any lawsuit or other legal proceeding inconnection with service as our employee or agent, or service as an employee oragent of another company at our request. The Amended Certificate would alsoprovide, as does Section 38 of our Bylaws, that we will pay all expensesincurred by such persons in defending any such proceeding as they are incurred,so long as they agree to repay such expenses if it is ultimately determined thatthey are not entitled to indemnification for such expenses by us. We believethese indemnification provisions are customary, and that it is more common forDelaware corporations to include such indemnification provisions in theircertificates of incorporation rather than their bylaws. Based on ourconversation with potential directors, we believe it is important for us toprovide customary indemnification to directors and officers and to have acustomary Delaware Certificate of Incorporation in order for us to attract andretain the services of qualified individuals to serve as our directors andofficers. Elimination of the obligation to make an offer for all of the outstandingcapital stock under certain circumstances. The Current Certificate obligates any person: (1) who acquires, in one or aseries of transactions, securities constituting thirty percent (30%) or more ofthe voting power of our outstanding capital stock, or (2) who, together withpersons acting in concert with such person, holds securities constituting notless than thirty percent (30%) but not more than fifty percent (50%) of thevoting power of our outstanding capital stock, and acquires, together withpersons acting in concert with such person, in any twelve (12) month period,additional securities constituting more than one percent (1%) of such votingpower, to extend an offer (an "Offer") to the holders of all of our outstandingcapital stock and outstanding convertible securities, warrants, options orsubscription rights, for the acquisition of these securities (the "OfferProvision"). The Amended Certificate would eliminate these obligations. The Offer Provision significantly impairs our ability to raise capital and makeacquisitions of other companies by means of issuing our capital stock where theamount issued triggers the obligation to extend an Offer, because we wouldbecome obligated to extend an Offer to all of our security holders upon theclosing of any such acquisition or financing transaction unless this obligationwere waived by our stockholders. Eliminating the Offer Provision from ourcertificate of incorporation would provide us the flexibility to effect suchacquisitions and financings without holding a meeting of stockholders andobtaining such a waiver. Furthermore, by removing the Offer Provision, we will not need to make an Offerin connection with our reorganization whereby we shall become the directwholly-owned subsidiary of Phorm by means of a merger with Phorm's wholly ownedsubsidiary. While we do not believe that the Offer Provision in the CurrentCertificate was meant to apply to this type of merger, the Offer Provision doesnot specifically exclude internal reorganizations. The Offer Provision is also unusual for a Delaware corporation since it ismodelled after provisions in the The City Code on Takeovers and Mergers of theUnited Kingdom's Takeover Panel, which ordinarily does not apply to Delawarecorporations. Based on our conversation with potential directors, we believe itis important for us to have a customary Delaware Certificate of Incorporation inorder for us to attract and retain the services of qualified individuals toserve as our directors and officers, and for us to attract investors. Moreover,because the Offer Provision is simply modelled after The City Code, the OfferProvision can result in consequences that were not intended by The City Code.However, the Offer Provision is designed to ensure that our security holders ofthe same class are treated equally by a potential acquirer, and deletion of theOffer Provision from our Certificate of Incorporation would eliminate thebenefits it would provide you and our other stockholders in the event of ahostile attempt to take control of us. Providing that any part of our Certificate of Incorporation may be amended bythe vote of holders of a majority of our outstanding common stock. The Current Certificate requires no less than seventy-five percent (75%) ofshares voted to amend, alter, or repeal certain provisions of our Certificate ofIncorporation. The Amended Certificate would require the vote of holders of amajority of our outstanding common stock to amend, alter or repeal any provisionof our Certificate of Incorporation. We believe it is more customary forDelaware corporations to be governed by the provision in the Amended Certificatethan the provision in the Current Certificate. Based on our conversation withpotential directors, we believe that it is important for us to have a customaryDelaware Certificate of Incorporation in order for us to attract and retain theservices of qualified individuals to serve as our directors and officers and forus to attract investors. Elimination of Restrictions on Borrowing. The Current Certificate contains provisions which restrict our borrowing. If wedesire to borrow amounts or in a manner that would violate the restrictions ofthe Current Certificate, we would be required to solicit the waiver of theseprovisions from our stockholders, which could delay or prevent such borrowing.We believe that it is in our and our stockholders' best interests if borrowingis left to the discretion of our Board of Directors and management, since theyare most familiar with and responsible for our day-to-day operations and ourliquidity requirements. Such provisions are unusual for a public Delawarecorporation's Certificate of Incorporation. Based on our conversation withpotential directors, we believe it is important for us to have a customaryDelaware Certificate of Incorporation in order for us to attract and retain theservices of qualified individuals to serve as our directors and officers and forus to attract investors. Vote Required Both the affirmative vote of seventy-five percent (75%) of our outstandingshares of common stock present in person or represented by proxy at the annualmeeting and entitled to vote and which have actually been voted, and theaffirmative vote of a majority of the shares of our outstanding common stock onthe record date and entitled to vote, are required for the approval of theAmendment. Upon the execution and return of the enclosed form of proxy, theshares represented thereby will be voted in accordance with the terms of theproxy, unless the proxy is revoked. If no directions are indicated in suchproxy, the shares represented thereby will be voted "FOR" the approval of theAmendment. The Board of Directors has reserved the right, in the exercise of itsdiscretion, to abandon the Amendment regardless of whether the shareholdersapprove it. If the Amendment is approved by the stockholders and it is notabandoned by the Board of Directors, it will become effective upon filing of theCertificate of Amendment with the Secretary of State of the State of Delaware,which filing is expected to occur soon after the Annual Meeting. THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE "FOR" THE APPROVAL OF THEAMENDMENT OF OUR AMENDED AND RESTATED CERTIFICATE OF INCORPORATION, AS AMENDED,AS SET FORTH IN THE CERTIFICATE OF AMENDMENT. PROPOSAL NUMBER 3 RATIFICATION OF APPOINTMENT OF AUDITORS Our Board of Directors has appointed H.W. Fisher & Company as the auditors toaudit our accounts for the year ending December 31, 2007. H.W. Fisher & Companyhave been our auditors with effect our December 2004 year end. Notwithstandingits selection, the Board of Directors, in its discretion, may appoint anotherauditors at any time during the year if the Board of Directors believes thatsuch a change would be in our and our stockholders' best interests. If theappointment is not ratified by our stockholders, the Board of Directors mayreconsider whether it should appoint another auditors. A representative of H.W.Fisher & Company will be present (either in person or by telephone) at the 2007annual meeting and will have an opportunity to make a statement if he or shedesires to do so, and will respond to appropriate questions from stockholders. Vote Required The affirmative vote of a majority of our outstanding shares of common stock,present in person or represented by proxy at the 2007 annual meeting entitled tovote and which have actually been voted is required for the approval of theratification of the appointment of H.W. Fisher & Company as our auditors for thefiscal year ending December 31, 2007. Upon the execution and return of theenclosed form of proxy, the shares represented thereby will be voted inaccordance with the terms of the proxy, unless the proxy is revoked. If nodirections are indicated in such proxy, the shares represented thereby will bevoted "FOR" the ratification of H.W. Fisher & Company as our auditors for thefiscal year ending December 31, 2007. THE BOARD OF DIRECTORS RECOMMENDS YOU VOTE "FOR" THE RATIFICATION OF THEAPPOINTMENT OF H.W. FISHER & COMPANY AS OUR AUDITORS FOR THE FISCAL YEAR ENDINGDECEMBER 31, 2007. other mattersWe do not know of any matters that are to be presented for action at the annualmeeting other than those set forth above. If any other matters properly comebefore the annual meeting, the persons named in the enclosed form of proxy willvote the shares represented by proxies in accordance with their best judgment onsuch matters. By Order of the Board of Directors Kent ErtugrulDirector and Chief Executive Officer London, EnglandMarch 30, 2007 Appendix A PROXY THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS The shareholder executing and delivering this Proxy hereby appoints Messrs. KentErtugrul and Gerard Baz and each of them as Proxies, with full power ofsubstitution, and hereby authorizes them to represent and vote, as designatedbelow, all shares of common stock of 121Media, Inc. held of record by theundersigned as of March 29, 2007, at the annual general meeting of stockholders,to be held at our offices at Golden Cross House, 8 Duncannon Street, London WC2N4JF, on April 26, 2007 at 11:00 a.m., or at any adjournment thereof.The Board of Directors recommends a Vote "FOR" each of the items listed below. 1. To elect two directors. The nomineesare: Gerard Baz, for Class I directorKent Ertugrul, for Class II director FOR ALL WITHHOLD AS TO ALL FOR ALL EXCEPT o o o 2. To adopt the proposed amendment to ourAmended and Restated Certificate of Incorporation as set forth in theCertificate of Amendment attached as Appendix B to the accompanying ProxyStatement.. FOR AGAINST ABSTAIN o o o 3. To approve and ratify the selection ofthe auditors to audit our audited accounts for the year ending December 31,2007. FOR AGAINST ABSTAIN o o o 4. To consider and act upon any othermatters that properly may come before the meeting or at any postponement oradjournment thereof. The undersigned hereby acknowledges receipt of the Notice of the annual meetingof stockholders and the Proxy Statement accompanying such Notice, revokes anyproxy or proxies heretofore given to vote upon or act with respect to theundersigned's shares and hereby ratifies and confirms all that said proxies,their substitutes, or any of them, may lawfully do by virtue thereof.This Proxy when properly executed will be voted in the manner directed herein bythe undersigned shareholder. If no direction is made, this Proxy will be votedfor each of the proposals listed above and for such other matters as mayproperly come before the meeting as said proxies deem advisable.THIS PROXY SHOULD BE MARKED, DATED AND SIGNED BY THE STOCKHOLDER(S) EXACTLY ASSUCH STOCKHOLDER'S NAME APPEARS HEREON AND RETURNED PROMPTLY IN THE ENCLOSEDENVELOPE. PERSONS SIGNING IN A FIDUCIARY CAPACITY SHOULD SO INDICATE. IF SHARESARE HELD BY JOINT TENANTS OR AS COMMUNITY PROPERTY, BOTH SHOULD SIGN. DATE: --------------------------- Signature --------------------------- Signature (Joint Owners) Appendix B CERTIFICATE OF AMENDMENT OF AMENDED AND RESTATED CERTIFICATE OF INCORPORATION OF 121MEDIA, INC. * * * * * 121Media, Inc., a corporation (hereinafter called the "Corporation") organizedand existing under and by virtue of the General Corporation Law of the State ofDelaware ("the Delaware General Corporation Law") does hereby certify that:I. The amendment to the Corporation's Amended and Restated Certificate ofIncorporation set forth below was duly adopted in accordance with the provisionsof Section 242 of the Delaware General Corporation Law and approved at an annualmeeting of stockholders, duly called and held, upon notice in accordance withSection 222 of the Delaware General Corporation Law, at which meeting the numberof shares as required by statue were voted in favor of the amendment.II. ARTICLE I. of the Amended and Restated Certificate of Incorporation of theCorporation is hereby deleted and replaced in its entirety as follows: "ARTICLE I. The name of this Corporation is Phorm, Inc. (the "Corporation")."III. The reference to "Thirteen Million (13,000,000)" in ARTICLE IV. of theAmended and Restated Certificate of Incorporation of the Corporation is herebydeleted and replaced with "Twenty Million (20,000,000)".IV. Section 2.(a) of ARTICLE V. of the Amended and Restated Certificate ofIncorporation of the Corporation is hereby deleted and replaced in its entiretyas follows:"(a) In furtherance and not in limitation of the powers conferred by statute,the Board of Directors of the Corporation is expressly authorized to adopt,amend or repeal the Bylaws of the Corporation."V. Section 2 of ARTICLE VI. of the Amended and Restated Certificate ofIncorporation of the Corporation is hereby deleted and replaced in its entiretyas follows:"2. Each person who is or was a director or officer of the Corporation and is orwas made a party to, or is threatened to be made a party to, or is involved inany action, suit or proceeding, whether civil, criminal, administrative orinvestigative (a "proceeding"), by reason of the fact that he or she or a personof whom he or she is the legal representative, is or was a director, officer,employee or agent of the Corporation (including any constituent corporationabsorbed in a merger) or is or was serving at the request of the Corporation(including any such constituent corporation) as a director, officer, employee oragent of another corporation, or of a partnership, joint venture, trust or otherenterprise, including service with respect to employee benefit plans, shall beindemnified and held harmless by the Corporation to the fullest extent permittedby the Delaware General Corporation Law, as it presently exists or may hereafterbe amended, against all liability and loss suffered and expenses reasonablyincurred by such person in connection therewith (including attorneys' fees,judgments, fines, ERISA excise taxes and penalties and amounts paid or to bepaid in settlement), and such indemnification shall continue as to a person whohas ceased to be a director or officer and shall inure to the benefit of his orher heirs, executors and administrators; provided, however, that the Corporationshall indemnify any such person seeking indemnity in connection with aproceeding (or part thereof) initiated by such person only if such proceeding(or part thereof) was authorized by the Board of Directors of the Corporation.The Corporation shall pay all expenses incurred by such a director or officer indefending any such proceeding as they are incurred in advance of its finaldisposition; provided, however, that if the Delaware General Corporation Lawthen so requires, the payment of such expenses incurred by a director or officerin advance of the final disposition of such proceeding shall be made only upondelivery to the Corporation of an undertaking, by or on behalf of such directoror officer to repay all amounts so advanced if it should be determinedultimately that such director or officer is not entitled to be indemnifiedhereunder or otherwise.3. The Corporation shall have the power to indemnify and hold harmless, to theextent permitted by applicable law as it presently exists or may hereafter beamended, any person who was or is made or is threatened to be made a party or isotherwise involved in any proceeding by reason of the fact that he or she, or aperson for whom he or she is the legal representative, is or was a director,officer, employee or agent of the Corporation or is or was serving at therequest of the Corporation as a director, officer, employee or agent of anothercorporation or of a partnership, joint venture, trust, enterprise or non-profitentity, including service with respect to employee benefit plans, against allliability and loss suffered and expenses reasonably incurred by such person inconnection with any such proceeding (including attorneys' fees, judgments,fines, ERISA excise taxes and penalties and amounts paid or to be paid insettlement).4. Any repeal or modification of this Article VI, or any adoption of anyprovision of this Corporation's Certificate of Incorporation inconsistent withthis Article VI shall be prospective and shall not affect the rights under thisArticle VI in effect at the time of the alleged occurrence of any act oromission to act giving rise to liability or indemnification."VI. ARTICLE VII of the Amended and Restated Certificate of Incorporation of theCorporation is hereby deleted and replaced in its entirety as follows: "ARTICLE VII. (Reserved.)"VII. ARTICLE IX of the Amended and Restated Certificate of Incorporation of theCorporation is hereby deleted and replaced in its entirety as follows: "ARTICLE IX.The Corporation reserves the right to amend, alter, change or repeal anyprovision contained in this Amended and Restated Certificate of Incorporation,in the manner now or hereafter prescribed by statute, except as provided inparagraph 2 of Article VI above, and all rights conferred upon the stockholdersherein are granted subject to this reservation."VIII. ARTICLE X of the Amended and Restated Certificate of Incorporation of theCorporation is hereby deleted and replaced in its entirety as follows: "ARTICLE X. (Reserved.)"IN WITNESS WHEREOF, the Corporation has caused the undersigned to execute thisCertificate of Amendment of the Amended and Restated Certificate ofIncorporation to be executed by Kent Ertugrul, its Chief Executive Officer, this_____ day of ______, 2007. 121MEDIA, INC.By: ______________________________Kent ErtugrulChief Executive Officer This information is provided by RNS The company news service from the London Stock Exchange