ex-director gothner sued for fraud
for esafetyworld/laminaire
In December 2001, the Securities and Exchange Commission initiated an investigation of the Company. The investigation closely followed a decision by NASDAQ to de-list the Company's common stock. As of this date, no charges have been brought or threatened by the SEC against the Company or any individual as a result of the investigation.
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On March 7, 2002, Norwood Venture Corp. ("Norwood") commenced an action in the Supreme Court of the State of New York, County of New York, against the Company and various other defendants, including eSAFETYWORLD, Edward A. Heil and K. Ivan F. Gothner. In this action, Norwood, a purported creditor of the now defunct Laininaire has asserted a fraudulent conveyance claim against the Company in connection with the Company's acquisition of certain intangible assets from Laminaire in 1999 (the "1999 transaction"). The complaint also asserts fraudulent conveyance and breach of fiduciary duty claims against Messrs. Heil and Gothner in connection with the 1999 transaction. In addition, the complaint asserts fraudulent misrepresentation and negligent misrepresentation claims against Messrs. Heil and K. Ivan F. Gothner in connection with an alleged February 2000 transaction in which Norwood allegedly gave up a lien on certain Laminaire property in exchange for a lien on Laminaire accounts receivable and inventory and other consideration. However, it does not appear that such claims are asserted against Mr. Heil or Mr. Gothner in their capacity as officers and/or directors of eSAFETYWORLD. After the commencement of this action, the parties entered into negotiations to resolve the dispute. While negotiations have continued, the parties have signed various stipulations extending defendants' time to respond to the complaint. |
