QR~G~NAL
\ IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE
IN AND FOR NEW CASTLE COUNTY
BURTON SCHWARTZ,
Plaintiff,
-against-
MARK S. ISAACSON, WILFRED, :
KOPELOWITZ, MARTIN B. HOFFMAN, :
and MICHAEL WIDLAND,
Defendants,
and
AMBIENT CORPORATION,
Nominal Defendant. :
COMPLAINT
Plaintiff alleges upon information and belief, except as to paragraph 1 which plaintiff
upon knowledge, as follows:
PARTIES
1. Plaintiff is a shareholder of nominal defendant Ambient Corporation ("Ambient"
the "Company"), and was a shareholder of Ambient at the time of the wrongs complained of and
continuously to date. Plaintiff brings this action derivatively in the right and for the
Ambient.
2. Nominal defendant Ambient is a corporation duly organized and existing under the
laws of the state of Delaware. Ambient is engaged in the architecture, design, development,
implementation and marketing of a proposed communication infrastructure that uses an electrical
power distribution grid as a high-speed telecommunication medium. The Company's proposed
powerline telecommunication solution is based on establishing and maintaining partnership
relationships with utilities and electrical power distribution companies, as well as
SNIPPETS:
-against-KOPELOWITZ, MARTIN B. HOFFMAN,:
AMBIENT CORPORATION,
Nominal Defendant.
Plaintiff alleges upon information and belief, except as to paragraph 1 which plaintiff
Plaintiff is a shareholder of nominal defendant Ambient Corporation ("Ambient" or
Ambient is engaged in the architecture, design, development, implementation and marketing of
Chief Executive Officer of the Company from September 2000 until his resignation on
Isaacson was affiliated with the Company since April 2000 when,
was the sole director of the Company from September to November 2000,
Secretary of the Company since September 2000 and was appointed to the Board of Directors in
Defendant Isaacson appointed defendant Michael Widland as a director
Defendants Isaacson, Kopelowitz, Widland and Hoffman are collectively referred
reassessment of general market developments in the field of smart card based technologies,
and operating losses were expected "to continue for the foreseeable
the report of the independent
employment agreement with him expiring December 3,
The Employment Agreement was totally one-sided in favor of Isaacson.
capitalization, there was a decrease, as Ambient's stock price fell from $4.06 on September 1,
had only $3,801, 546 in cash and cash equivalents, 50% less than the amount of cash and cash
financing and obtaining sufficient cash flow.
the purchase of a home in the New York Metropolitan area.
Company anticipated an outstanding principal loan balance of approximately $500,000.
Isaacson Resipns as CEO and the Companv Forpives His Loans of $655,000
The forgiveness of the loans reduced the
He thereby breached his fiduciary duties to the
The terms of the Employment Agreement were unfair to Ambient and were the
The severance benefits awarded to Isaacson for quitting his employment are so large
Prior to his appointment as CEO,
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