UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934 (Amendment No. )
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[_] Definitive Proxy Statement
[_] Definitive Additional Materials
Mizar Energy Company
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(Name of Registrant as Specified In Its Charter)
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MIZAR ENERGY COMPANY
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
(IN LIEU OF ANNUAL MEETING)
NOVEMBER 10, 2000
TO THE SHAREHOLDERS OF MIZAR ENERGY COMPANY
At the meeting, shareholders will act on the following matters:
1. Approval to reincorporate Mizar from the state of Colorado to
Florida and to change the company's name to HBOA Holdings, Inc.;
2. Approval of our Equity Compensation Plan;
3. Election of five directors to serve, each for a one-year term;
4. To transact such other business as may properly come before the
meeting.
Only shareholders of record at the close of business on October 23,
2000, are entitled to notice of and to vote at the special meeting (in lieu of
annual meeting) or any postponements or adjournments thereof.
Whether or not you plan to attend the special meeting in person, you
are requested to complete, date, sign and return the enclosed proxy card in the
enclosed envelope which requires no postage if mailed in the United States. If
you attend the special meeting, you may vote in person if you wish, even if you
have previously returned your proxy card.
By order of the Board of Directors,
MIZAR ENERGY COMPANY
Edward A. Saludes
Chief Executive Officer and President
Date: October 24, 2000
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TABLE OF CONTENTS
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Page
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ABOUT THE MEETING.........................................................................................1
WHAT IS THE PURPOSE OF THE SPECIAL MEETING (IN LIEU OF ANNUAL
MEETING)?...............................................................................1
WHO IS ENTITLED TO NOTICE OF, AND TO VOTE AT THE MEETING?........................................1
WHO CAN ATTEND THE MEETING?......................................................................1
WHAT CONSTITUTES A QUORUM?.......................................................................2
HOW DO I VOTE?...................................................................................2
CAN I VOTE BY TELEPHONE OR ELECTRONICALLY?.......................................................2
CAN I CHANGE MY VOTE AFTER I RETURN MY PROXY CARD(S)?............................................2
WHAT ARE THE BOARD'S RECOMMENDATIONS?............................................................3
WHAT VOTE IS REQUIRED TO APPROVE EACH ITEM?......................................................3
DOES IT APPEAR LIKELY THAT EACH OF THE PROXY PROPOSALS
WILL BE APPROVED?.......................................................................4
WHO PAYS FOR THE PREPARATION OF THE PROXY?.......................................................4
CAN I SEE A LIST OF THE SHAREHOLDERS ENTITLED TO VOTE?...........................................4
WHAT SHOULD I HAVE RECEIVED TO ENABLE ME TO VOTE?................................................4
MANAGEMENT................................................................................................5
EXECUTIVE COMPENSATION....................................................................................7
PRINCIPAL SECURITY HOLDERS AND SECURITY OWNERSHIP
OF MANAGEMENT.............................................................................................8
CERTAIN RELATIONSHIPS AND RELATED TRANSACTION.............................................................9
PROPOSAL 1 -- REINCORPORATION OF NAME CHANGE..............................................................10
PROPOSAL 2 -- APPROVAL OF OUR EQUITY COMPENSATION PLAN....................................................22
PROPOSAL 3 -- ELECTION OF DIRECTORS.......................................................................26
SELECTION OF AUDITORS.....................................................................................26
ANNUAL REPORT ON FORM 10-KSB..............................................................................27
INFORMATION CONCERNING SHAREHOLDER PROPOSAL...............................................................27
OTHER MATTERS.............................................................................................27
EXHIBITS
Exhibit A - Agreement and Plan of Merger
Exhibit B - Articles of Incorporation and Bylaws of HBOA Holdings, Inc.
Exhibit C - Mizar Energy Company dba HBOA Holdings, Inc. Equity Compensation Plan
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MIZAR ENERGY COMPANY
This proxy statement contains information related to our special
meeting (in lieu of annual meeting) of shareholders to be held on November 10,
2000, beginning at 10:00 a.m., Eastern time, at our corporate offices located at
2400 E. Commercial Blvd., Suite 221, Ft. Lauderdale, Florida, and at any
adjournments or postponements therefore. The approximate date that this proxy
statement, the accompanying notice of annual meeting and the enclosed form of
proxy, are first being sent to shareholders is October 24, 2000. You should
review this information in conjunction with our 2000 annual report to
shareholders which accompanies this proxy statement.
ABOUT THE MEETING
WHAT IS THE PURPOSE OF THE SPECIAL MEETING (IN LIEU OF ANNUAL MEETING)?
At our special meeting (in lieu of annual meeting), shareholders will
act upon the matters outlined in the accompanying notice of meeting, including:
1. Approval to reincorporate Mizar from the state of Colorado to
Florida and to change the company's name to HBOA Holdings,
Inc.;
2. Approval of our Equity Compensation Plan;
3. Election of five directors to serve, each for a one-year term;
4. To transact such other business as may properly come before
the meeting.
In addition, our management will report on the performance of Mizar
during fiscal 1999 and respond to questions from shareholders. Included with the
proxy statement is a copy of Mizar's Annual Report on Form 10-KSB for the fiscal
year ended December 31, 1999. We encourage you to read the Form 10-KSB. It
includes information on Mizar's operations, markets, products and services, as
well as Mizar's audited financial statements for the twelve months ended
December 31, 1999.
WHO IS ENTITLED TO NOTICE OF, AND TO VOTE AT THE MEETING?
Only shareholders of record at the close of business on the record
date, October 23, 2000, are entitled to receive notice of the special meeting
(in lieu of annual meeting) and to vote at the meeting, or any postponements or
adjournments of the meeting. Each outstanding share of common stock entitles its
holder to cast one vote on each matter to be voted.
WHO CAN ATTEND THE MEETING?
All shareholders as of the record date, or their duly appointed
proxies, may attend. Please note that if you hold shares in "street name" (that
is, through a broker or other nominee), you will
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need to bring a copy of a brokerage statement reflecting your stock ownership as
of the record date.
WHAT CONSTITUTES A QUORUM?
The presence at the meeting, in person or by proxy, of the holders of a
majority of the outstanding shares of our common stock as of the record date
will constitute a quorum. As of the record date, we have 10,050,000 shares of
our common stock issued and outstanding. Shares that are entitled to vote but
that are not voted at the direction of the beneficial owner ("abstentions"),
shares represented by proxies or ballots that are marketed "withhold authority"
with respect to the election of any nominee for election as a directors, and
votes withheld by brokers in the absence of instructions from beneficial holders
("broker nonvotes") will be counted for the purpose of determining whether there
is a quorum for the transaction of business at the special meeting.
If less than a majority of the outstanding shares of common stock
entitled to vote are represented at the meeting, a majority of the votes present
(either in person or by proxy) at the meeting may adjourn the meeting to another
date, time or place and notice need not be given of the new date, time or place
if the new date, time or place is announced at the meeting before an adjournment
is taken.
HOW DO I VOTE?
If you complete and properly sign the accompanying proxy card (s), and
return it to us, it will be voted as you direct. If you are a registered
shareholder and you attend the meeting, you may deliver your completed proxy
card(s) in person. "Street name" shareholders who wish to vote at the meeting
will need to obtain a proxy from the institution that holds their shares.
CAN I VOTE BY TELEPHONE OR ELECTRONCALLY?
If you shares are held in "street name," please check your proxy card
or contact your broker or nominee to determine whether you will be able to vote
by telephone or electronically.
The deadline for voting by telephone or electronically is November 9,
2000.
CAN I CHANGE MY VOTE AFTER I RETURN MY PROXY CARD(S)?
Yes. Even after you have submitted your proxy card, you may change your
vote at any time before the proxy is exercised by filing with our Secretary
either a notice of revocation or a duly executed proxy card bearing a later
date. The powers of the proxy holders will be suspended if you attend the
meeting in person and so request, although attendance at the meeting will not be
itself revoke a previously granted proxy or proxies.
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WHAT ARE THE BOARD' RECOMMENDATIONS?
Unless you give other instructions on your proxy card(s), the persons
named as proxy holders on the proxy card(s) will vote in accordance with the
recommendations of our Board of Directors. The recommendation of the Board is
set forth with the description of each item in the proxy statement. In summary,
the Board recommends a vote:
- for the proposal to reincorporate Mizar from the state of Colorado to
the state of Florida and to change the company's name to HBOA Holdings,
Inc. (see pages 10 to 24);
- for the proposal to approve our Equity Compensation Plan
(see page 22-25);
- for the election of the nominated slate of directors (see page 26);
The Board does not know of any other matters that may be brought before the
annual meeting nor does it foresee or have reason to believe that the proxy
holders will have to vote for substitute or alternate nominees for a position as
a director of Mizar. In the event that any other matter should properly come
before the meeting or any nominee for director is not available for election,
the proxy holder will vote as recommended by the Board of Directors, or if no
recommendation is given, in accordance with their best judgement.
WHAT VOTE IS REQUIRED TO APPROVE EACH ITEM?
Reincorporation and Name Change Proposal. To approve the
reincorporation and name change proposal, a majority of outstanding shares of
common stock entitled to vote on the proposed amendment must be voted in favor
of the reincorporation and name change proposal. Abstentions and broker nonvotes
will have the same effect as voting against the reincorporation and name change
proposal.
Equity Compensation Plan. To approve our Equity Compensation Plan, a
majority of the shares of common stock present in person or represented by proxy
and entitled to vote at the meeting must be voted in favor of the Equity
Compensation Plan Proposal. Abstentions from voting will have the same effect as
voting against the proposal to approve Equity Compensation Plan. Broker nonvotes
will have no impact on the proposal to approve our Equity Compensation Plan
since they are not considered shares entitled to vote.
Election of Directors. The nominees for election to the Board of
Directors who receive the greatest number of votes cast for the election of
Directors by the shares present, in person or by proxy, shall be elected
Directors. Shareholders do not have the right to cumulate their votes for
directors. In the election of directors, an abstention or broker nonvote will
have no effect on the outcome.
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DOES IT APPEAR LIKELY THAT EACH OF THE PROXY PROPOSALS WILL BE APPROVED?
Yes, Gary Verdier, a shareholder who owns 60% of Mizar's issued and
outstanding common stock, has stated that he intends to vote in favor of each of
the proposals. Thus, approval of the following proposals is assured:
- the proposal to reincorporate Mizar from the state of Colorado to the
state of Florida and to change the company's name to HBOA Holdings,
Inc.
- for the election of the nominated slate of directors
- for the proposal to approve our Equity Compensation Plan
WHO PAYS FOR THE PREPARATION OF THE PROXY?
We will pay the cost of preparing, assembling and mailing the proxy
statement, the proxy card and the Annual Report on Form 10-KSB for the twelve
months ended December 31, 1999. In addition to the use of mail, our officer,
directors, employees and consultants (the "representatives") may solicit proxies
personally and by telephone. Our representatives will not receive any
compensation for soliciting proxies other than their regular salaries or
consulting fees. We may request banks, brokers and other custodians, nominees
and fiduciaries to forward copies of the proxy material to the beneficial owners
of our common stock and to request authority for the execution of proxies and we
may reimburse such persons for their expenses incurred in connection with these
activities.
CAN I SEE A LIST OF THE SHAREHOLDERS ENTITLED TO VOTE?
Any shareholder may look at the complete list of the shareholders that
are entitled to vote at the special meeting so long as it is for a purpose
germane to the special meeting. The list will be available in these
circumstances, during normal business hours, at our offices located at 2400 E.
Commercial Blvd., Suite 221, Ft. Lauderdale, Florida 33308 for a period of ten
days prior to the meeting and at the meeting itself.
WHAT SHOULD I HAVE RECEIVED TO ENABLE ME TO VOTE?
Your package from us should contain (1) this proxy statement, (2) a
common stock proxy card and (3) our annual report on Form 10-KSB for the twelve
months ended December 31, 1999. This package is being mailed on or about October
23, 2000.
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MANAGEMENT
Officers and Directors
The following table sets forth the names and positions of all of the
executive officers and directors of Mizar.
Name Age Position
---- --- --------
Edward A. Saludes 39 Chief Executive Officer, President and Director
Harvey Judkowitz 52 Chief Financial Officer and Director
William Shope 53 Vice President of Operations
Gary Verdier 54 Chairman
Robert C. Fivian 60 Director
Marion F. Wolf & 52
Carl T. Wolf 53 Director*
*Marion F. Wolf and Carl T. Wolf share one seat on Mizar's Board of Directors.
Edward A. Saludes has served as the Chief Executive Officer and
President since August 14, 2000 through the present date. Mr. Saludes has over
18 years of chief executive, sales management, operations management and product
engineering experience in the high technology and finance industries. Mr.
Saludes was the founder, president and CEO of a finance company which he and
team grew to over $125 million in annual volume. He also held prior sales
management, engineering, management and operations positions with Cadence Design
Systems, Sun Microsystems, Litton Industries, and Lockheed Martin. Ted holds BS
and MS degrees in engineering from the University of Florida and an MBA degree
in Finance from Rollins College.
Harvey Judkowitz, has served as the Chief Financial Officer and
Director since August 14, 2000. He has over 25 years of experience in executive
management, financial management, and accounting, including several CEO and CFO
positions with publicly held companies. During the past five years, Mr.
Judkowitz has worked as an independent business consultant. He was CEO of
Designers International Corp. a public company, CEO of Utilicore Corporation ,
and CFO of Capital International. Harvey brings extensive breadth and experience
in SEC compliance, auditing, financial management and internal revenue service
compliance. Harvey is a member of the Public Companies Division of the AICPA and
as such is qualified to perform audits of public companies. Harvey holds a BBA
degree from Pace University and is a Certified Public Accountant in Florida and
New York.
Gary Verdier has served as the Chairman of Mizar since December 28,
1999 through the present date. He served as the Chief Executive, President, Vice
President, Secretary and Treasurer of Mizar from December 28, 1999 through
August 14, 2000. For the past seven years, Mr. Verdier has been the President of
Dundas Systems, Inc., a $10 million dollar a year business opportunity company
with a strong and consistent record of profitability. Mr. Verdier has conducted
thousands of seminars to home based business owners throughout the United States
and Dundas Systems has successfully marketed a home based concept to thousands
of American workers. Mr. Verdier has a unique insight to the home based business
market, as well as the needs of the individual operating a home based business.
The significant growth of Internet users combined with Mr. Verdier's
understanding of the products and services home based business owners need to
compete in today's business environment provided the catalyst for the creation
of HBOA.Com, Inc., the operating subsidiary of Mizar.
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Marion F. Wolf has served as a director of Mizar from August 14, 2000
through the present date. Ms. Wolf shares her board seat with her husband, Carl
T. Wolf. Ms. Wolf is an adjunct Professor at Rutgers University where she
developed classes in Entrepreneurship, small business management and new
ventures. Previously she was co-founder of Alpine Lace Brands and served on the
Board of Directors from 1990-1997. Ms. Wolf is currently serving on two
not-for-profit boards, which are assisting the visually impaired and
academically challenged adult and student. In addition, she is a consulting
partner in a firm that specializes in providing integrated marketing solutions
for companies seeking Internet presence. She received her BS Degree from The
College of New Jersey and her MS Degree from CW Post College at Long Island
University.
Carl T. Wolf has served as a director of Mizar from August 14, 2000
through the present date. Mr. Wolf shares his board seat with his wife, Marion
F. Wolf. Mr. Wolf was the Chairman/CEO of Alpine Lace Brands, Inc. Mr. Wolf was
the co-founder of Alpine Lace Brand in 1983 and built it into the second most
recognized cheese brand in the United States. Alpine Lace became a public
company in 1986, and in 1997 the Company was sold to Land O'Lakes. Mr. Wolf was
also Chairman/CEO of MCT Danes, which was sold to Land O'Lakes in the Alpine
Lace transaction. Mr. Wolf is currently a Director of Media Bay, formerly known
as the Audio Book Club. Media Bay is one of the fastest growing sites on the
Internet. Mr. Wolf received his MBA from the University of Pittsburgh, and his
BA in Economics from Rutgers University where he was a Henry Rutgers Scholar and
a Woodrow Wilson Nominee.
Robert C. Fivian has served as a director of the Company since August
14, 2000 through the present date. Mr. Fivian has served as the Managing
Director of Rosenthal Collins Fox Asset Management Group. Mr. Fivian also served
as President of LIT Asset Management and Vice Chairman of LIT America, Inc., a
member firm of the New York Stock Exchange and all principal US stock and
futures exchanges. Mr. Fivian has been in the commodities, futures and stock
brokerage business for the past 34 years. Mr. Fivian was Chairman and Chief
Executive Officer of Phoenix Futures Inc. and Phoenix Asset Management, Inc.
from 1985 to 1990. Mr. Fivian was President and Chief Executive Officer at
Heinold Commodities, Inc. and Executive Vice President of Heinold Asset
Management, Inc. for 10 years. He was associated with Bache & Co., Inc. for 17
years holding various positions including account executive, floor manager at
the Chicago Board of Trade, manager of the Chicago Midwest Commodity Department
and First Vice-President of the firm.
Mr. Fivian has held memberships on most of the major US commodity
exchanges and has served on numerous committees of the Chicago exchanges. He is
a past governor of the International Monetary Market and a former director of
the Futures Industry Association. He is currently a member of the Chicago Board
of Trade and the Chicago Mercantile Exchange. Mr. Fivian graduated from the
University of Wisconsin with a degree in Economics and Finance.
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Board Meetings and Committees
During 1999, the Board of Directors met or acted by unanimous written
consent on 2 occasions. During various time periods during 1999, Mr. Davis, Mr.
Lee and Mr. Verdier served as directors. Each director attending all the
meetings that were held when he was a director.
At the present time, we do not have an audit, nomination or
compensation committee. In the near future, we intend to establish these
committees.
Directors Compensation
Directors do not receive any additional compensation for services
rendered as members of our Board of Directors. However, we intend to establish a
policy whereby directors will be granted options when they join our Board of
Directors. We have agreed to obtain directors and officers insurance for each
member of the Board.
Compliance with Section 16(a) of the Securities Exchange Act of 1934
Section 16(a) of the Securities and Exchange Act of 1934 requires
officers, directors and persons who own more than ten percent of a registered
class of a company's equity securities to file initial reports of beneficial
ownership and to report changes in ownership of those securities with the
Securities and Exchange Commission and the National Association of Securities
Dealers. There are also required to furnish Mizar with copies of all Section
16(a) forms they file. To our knowledge, based solely on a review of the copies
of Forms 3, 4 and 5 furnished to us or written representations that no other
transactions were required, we have determined that the pertinent officers,
directors and principal shareholders have complied with all applicable Section
16(a) requirements during fiscal 2000.
EXECUTIVE COMPENSATION
The following table summarizes all compensation awarded to, earned by
or paid to (a) Philip J. Davis, the Company's Chief Executive Officer during
fiscal 1997, 1998 and fiscal 1999 through December 28, 1999 and (b) Gary
Verdier, the Company's Chief Executive Officer from December 28, 1999 through
August 14, 2000. No other principal executive officer received a total annual
salary and bonus from the Company which exceeded $100,000 during this time
period.
Other
Name and Position Year Salary Bonus Compensation
----------------- ---- ------ ----- ------------
Gary Verdier 1999(1) $ 0 0 0
President, Vice President 1998 $ 0 0 0
Treasurer, Secretary and 1997 $ 0 0 0
Director
Philip J. Davis 1999 $ 0 0 0
Former President, 1998 $ 0 0 0
Treasurer and Director 1997 $ 0 0 0
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(1) Mr. Verdier became the Chief Executive Officer and President on December 28,
1999.
(2) Mr. Davis served as the President Treasurer and Director from June 1996 to
December 28, 1999.
New Chief Executive Officer
We entered into an employment agreement with Edward Saludes, our new
Chief Executive Officer and President, in June 2000. We amended the employment
agreement on October 10, 2000. Mr. Saludes's annual salary under this agreement
is $135,000 per year and he is entitled to receive an annual bonus of up to a
maximum or $100,000 per year. His employment agreement is for a period of 3
years. As a signing bonus, Mr. Saludes received 50,000 shares of our common
stock. Mr. Saludes also received options to purchase up to an aggregate of
950,000 shares of our common stock at an exercise price of $1.50 per share,
which options are subject to certain vesting provisions.
Mr. Saludes's employment agreement contains confidentiality and
non-competition provisions. We may terminate the employment agreement at any
time by providing written notice to Mr. Saludes. If the termination is initiated
by Mizar without cause, Mr. Saludes is entitled to receive a severance
payment equal to his annual salary which would have been payable to him if he
had remained employed by Mizar for the remaining term of his employment
agreement.
Option Grants to Executive Officers During 1999
No options were granted to Mr. Verdier, Mr. Davis or Mr. Saludes during
fiscal 1999. In June 2000, Mr. Saludes received options to purchase up to
150,000 shares of our common stock at an exercise price of $1.50 per share.
These options vest at the rate of 12,500 options per month. On October 10,
2000, Mr. Saludes received incentive stock options to purchase 800,000 shares of
our common stock at an exercise price of $1.50 per share. These options being to
vest on June 10, 2001 and will vest at equal monthly vesting increments of 1/24
of said options per month for the second and third years of the employment
agreement.
Aggregated Option Exercises and Fiscal Year End Option Values
No executive officers exercised any options during fiscal 1999 and they
did not own any options at the end of fiscal 1999.
PRINCIPAL SECURITY HOLDERS AND SECURITY
OWNERSHIP OF MANAGEMENT
The following table shows the number of shares of common stock
beneficially owned (as of October 6, 2000 by:
- each person who we know beneficially owns more than 5% of either
class or our common stock;
- each director;
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- each current executive officer named in the Summary Compensation
Table on page 7;
and
- all of our directors and executive officers as a group.
Unless otherwise indicated, the address for each named person is c/o
Mizar Energy Company, 2400 E. Commercial Blvd., Suite 221, Ft. Lauderdale, FL
33308 and each named person has sole voting and investment power over the shares
shown below. As of October 10, 2000, the Company had 10,050,000 shares of its
common stock issued and outstanding. An asterisk indicates beneficial ownership
of less than 1% of the Company's outstanding common stock.
Name of Individuals or Number Amount and Nature of
of Persons in Group Beneficial Ownership Percentage of Class
--------------------------------------------------------------------------------
Edward Saludes 100,000 (1) *0%
Gary Verdier 6,054,574 (2) 60.5%
Robert Fivian 25,000 *
Harvey Judkowitz 0 (3) *
Marion Wolf 100,000 (4) *
Carl Wolf 100,000 (4) *
William C. Shope 0 (5) *
All Executive Officers and
Directors as a Group (7 persons) 6,319,574 62.9%
(1) Includes options to purchase 50,000 shares of our common stock which have
vested as of October 10, 2000. Excludes options to purchase 900,000 shares which
have not vested as of October 10, 2000.
(2) Includes 216,226 shares held by Dundas Systems, Inc., a corporation
controlled by Mr. Verdier.
(3) Excludes options to purchase 40,000 shares of our common stock at an
exercise price of $1.50 per share. As of October 10, 2000, no options are
vested.
(4) Represents shares of Mizar's common stock held jointly by Marion Wolf and
Carl Wolf.
(5) Excludes options to purchase 100,000 shares of our common stock at an
exercise price of $1.50 per share. As of October 10, 2000, no options are
vested.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
During the last two fiscal years, we have not engaged in any
transactions with management or others in which the amount involved exceeded
$60,000.
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PROPOSALS TO THE MIZAR SHAREHOLDERS
PROPOSAL 1. REINCORPORATION AND NAME CHANGE
Our Board has unanimously approved and recommends that you approve our
proposed (i) reincorporation from the State of Colorado to the State of Florida
and (ii) name change to HBOA Holdings, Inc. The reincorporation and name change
would be accomplished through a merger whereby:
-We would merge with and into HBOA Holdings, Inc., a newly-formed
wholly owned subsidiary of ours that is incorporated in Florida; and
-HBOA Holdings, Inc., as the Florida corporation, would continue as the
surviving corporation and we, as the Colorado corporation, would cease to exist.
By operation of law, upon completion of the merger, all of our assets,
property, rights, liabilities and obligations would be transferred to and
assumed by HBOA Holdings, Inc. We would accomplish the merger pursuant to the
terms and conditions of an agreement and plan of merger (the "merger agreement")
between us and HBOA Holdings, a copy of which is attached hereto as Exhibit A.
As described below, the reincorporation and name change would not
result in any change of our business, management, executive officers, directors,
location of our principal executive office, assets, liabilities or net worth.
The description set forth below is a summary of the merger agreement, does not
purport to be complete, and is subject to and qualified in its entirety by
reference to the text of the merger agreement itself.
REASONS FOR THE REINCORPORATION AND THE NAME CHANGE
We recommend that you approve the merger agreement and our resulting
reincorporation from the State of Colorado to the State of Florida and name
change to HBOA Holdings, Inc. for the following reasons:
The principal reason for the reincorporation and name change is (1) to
conform Mizar's legal residence to its principal place of business and (2) to
have our name be more reflective of our present operations. Mizar was
incorporated under Colorado law on December 11, 1996 at a time when Mizar's
business was closely linked to the state of Colorado. Mizar's co-founders had
business operations in Colorado. On December 28 1999, HBOA.Com, Inc., a company
with its primary business operations in Florida, purchased 60% of Mizar's issued
and outstanding common stock. In connection with the acquisition, Mizar's
previous officers and directors resigned and HBOA's management took over. New
management refocused Mizar's business on the sale of products and services to
the owners of home based businesses. At this time, Mizar relocated its primary
operations to Florida.
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With the primary operations of Mizar outside of Colorado, Mizar's
historical ties to Colorado no longer appear to management to be decisive in
determining the best jurisdiction to fulfill its business needs. In addition,
the Board believes that Mizar's reincorporation is consistent with our
philosophy of maintaining a positive corporate presence in Florida.
The Board of Directors believes that the Florida Business Corporation
Act (the "Florida Act") will meet the Company's business needs. The Florida Act
is a comprehensive, modern and flexible statute based on the Revised Model
Business Corporation Act. For the most part, it provides the flexibility in
management of a corporation and in the conduct of its various business
transactions that is characteristic of the Colorado Business Corporation Act
(the "Colorado Act"). See "Comparison of Colorado Law and Florida Law."
Management also believes that the name change is more reflective of
Mizar's present operations. Since HBOA's acquisition of Mizar on December 28,
1999, our business operations have been centered on becoming the premier
Internet web portal for home based businesses.
Based upon the foregoing, the Board of Directors has determined that it
would be in the best interests of the Company and its shareholders to
reincorporate in Florida, through a merger with its wholly-owned subsidiary,
HBOA Holdings, Inc.
PRINCIPAL EFFECT OF THE REINCORPORATION AND NAME CHANGE
The principal effect of the reincorporation would be for Mizar to
become a Florida corporation. As a result of the reincorporation, our corporate
affairs would be governed by the Florida Act, which the Board believes, as
discussed above, has economic advantages over Colorado law. The reincorporation
would not have any material adverse effect on our:
-BUSINESS. The reincorporation would not result in any material change
in our business, management, executive officers, directors, location of
principal executive offices, assets, liabilities or net worth. HBOA Holdings,
Inc. will take the name "HBOA Holdings, Inc."
-CAPITAL STOCK AND DERIVATIVE SECURITIES. The number of outstanding
shares of common stock will not be affected by the merger. Each share of common
stock owned by you immediately prior to the merger would be converted
automatically at the effective time of the merger into one share of common stock
of HBOA Holdings, Inc. Furthermore, each stock option, stock warrant,
convertible debt instrument and other right to subscribe for or purchase shares
of Mizar's common stock will be converted into a stock option, stock warrant,
convertible debt, instrument or other right to subscribe for or purchase shares
of common stock of HBOA Holdings. The rights, designations, preferences and
limitations of the shares of common stock of HBOA Holdings that would be issued
to our shareholders in the merger would be identical to those of our common
stock immediately prior to the merger. The shares of common stock of HBOA
Holdings, Inc. that will be issued to our shareholders will not be registered
under the Securities Act in reliance upon Rule 145(a)(2) promulgated under the
Securities Act. Shareholders will need to check with their personal attorneys to
see if there are any restrictions on their resale of shares of common stock of
HBOA Holdings, Inc.
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-LISTING ON THE OTC BULLETIN BOARD AND TRADING. Our shares are listed
on the OTC Bulletin Board and trade under the symbol "MIZR." The name change
should not affect the trading of our stock on the OTC Bulletin Board. However,
after the name change is effectuated, we intend to change our trading symbol so
that it is more reflective of our new name.
THE MERGER AGREEMENT
The merger agreement provides, among other things, that at the
effective time of the merger:
-we will merger with and into HBOA Holdings, Inc., with HBOA Holdings,
Inc., continuing as the surviving corporation;
-HBOA Holdings, Inc. will assume all of our assets and liabilities,
including contractual obligations and obligations under our outstanding
indebtedness;
-our existing directors and officers will become the directors and
officers of HBOA Holdings, Inc. for identical terms of office;
-the surviving corporation will assume the name HBOA Holdings, Inc.
-each of our issued and outstanding shares of common stock will
automatically be converted into one-fully-paid and nonassessable share of common
stock, $.01 par value, of HBOA Holdings, Inc.; and
-each or our currently outstanding stock options and warrants will
automatically be converted into an option or warrant of HBOA Holdings, Inc. to
purchase the same number of shares of common stock of HBOA Holdings, Inc. at the
same exercise price per share and upon the same terms and subject to the same
conditions as set forth in the option or warrant agreement.
PROCEDURE TO EXCHANGE CERTIFICATES
As soon as is practicable after the effective time of the merger,
Mizar's transfer agent, Corporate Stock Transfer of Denver, Colorado (the
"Transfer Agent") will mail a form of transmittal letter to holders of Mizar's
common stock. The form of transmittal letter will contain instruction with
respect to the surrender of certificates representing Mizar's common stock.
MIZAR'S STOCK CERTIFICATES SHOULD NOT BE RETURNED WITH THE ENCLOSED PROXY AND
SHOULD NOT BE FORWARDED TO THE TRANSFER AGENT UNLESS AND UNTIL THE MIZAR
SHAREHOLDERS RECEIVES A LETTER OF TRANSMITTAL FOLLOWING THE EFFECTIVE TIME.
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SHAREHOLDER APPRAISAL RIGHTS
The Colorado Act allows for shareholders the right, under certain
conditions, to dissent from certain corporate actions and redeem their stock in
the Company for cash. We believe that in this merger stockholders do have the
right to dissent from our reincorporation under Colorado law. To exercise your
dissenting rights, stockholders must notify us in writing before the meeting.
The notice must demand payment if the proposed merger is approved. Stockholders
should not vote the shares in favor of the proposed transaction if they choose
to elect appraisal rights. We will notify dissenting stockholders in writing
within 10 days where you can return your certificates and receive payment for
the shares.
TAX CONSEQUENCES OF THE MERGER
The merger and resulting reincorporation of the Company from Colorado
to Florida will constitute a tax-free reorganization within the meaning of
Section 368(a)(1)(F) of the Internal Revenue Code of 1986, as amended.
Accordingly, for federal income tax purposes, no gain or loss will be recognized
by stockholders upon the conversion of the company's Common Stock into common
stock of HBOA Holdings Inc.. Each stockholder whose shares are converted from
the Company's Common Stock into HBOA Holdings, Inc.'s Common Stock will have the
same basis in his or her common stock of HBOA Holdings, Inc. as he or she had in
his or her Common Stock of Mizar immediately prior to the effective date of the
merger and his or her holding period of HBOA Holdings, Inc.'s common stock will
include the period during which he or she held the corresponding shares of Mizar
common stock, provided such corresponding shares of Mizar's Common Stock were
held as a capital asset on the effective date of the merger.
No gain or loss will be recognized by Mizar or by HBOA Holdings, Inc.
as a result of the merger and reincorporation, and HBOA Holdings, Inc. generally
will succeed, without adjustment, to the tax attributes of Mizar.
NO INFORMATION IS PROVIDED IN THIS PROXY STATEMENT REGARDING THE TAX
CONSEQUENCES, IF ANY, UNDER APPLICABLE STATE, LOCAL OR FOREIGN LAWS, AND EACH
STOCKHOLDER IS ADVISED TO CONSULT HIS OR HER PERSONAL ATTORNEY OR TAX ADVISOR AS
TO THE FEDERAL, STATE, LOCAL OR FOREIGN TAX CONSEQUENCES OF THE PROPOSED
REINCORPORATION IN VIEW OF THE STOCKHOLDER'S INDIVIDUAL CIRCUMSTANCES.
ACCOUNTING TREATMENT OF THE MERGER
In accordance with generally accepted accounting principles, we expect
that the merger and resulting reincorporation will be accounted for as a
reorganization of entities under common control at historical cost in a manner
similar to a pooling of interests. Under this accounting method, the assets and
liabilities of the combining entities will be carried forward at their recorded
historical book values. The merger and resulting reincorporation will be
disclosed in a footnote to financial statements in interim and year-end filings.
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EFFECTIVE DATE
The merger and resulting reincorporation and name change will become
effective as soon as practicable after shareholder approval is obtained and all
other conditions to the merger are satisfied. The merger may be abandoned at any
time prior to its effectiveness if our Board of Directors determines, in its
discretion that consummation of the merger is no longer advisable.
COMPARISON OF COLORADO LAW AND FLORIDA LAW
We are incorporated in Colorado and HBOA Holdings, Inc. is incorporated
in Florida. Our shareholders, whose rights are currently governed by Colorado
law and our articles of incorporation, and bylaws, will, upon consummation of
the merger, become shareholders of HBOA Holdings, Inc. and their rights will be
governed by the Florida Act and the articles and bylaws of HBOA Holdings, Inc.
Although it is not practical to compare all the differences between:
(a) The Colorado law and our articles of incorporation and bylaws
and
(b) The Florida Act and HBOA Holdings, Inc.'s articles of
incorporation and bylaws;
the following is a summary of certain of those differences which may
significantly affect your rights. The articles of incorporation and bylaws of
HBOA Holdings, Inc. are substantially identical to our current articles of
incorporation and bylaws, except as described below and except for statutory
references necessary to conform to the Florida Act and other differences
attributable to the differences between the Florida Act and Colorado law. The
form of HBOA Holdings, Inc. articles of incorporation and bylaws are attached
hereto as Exhibit B. By voting to approve the merger agreement and resulting
reincorporation and name change, shareholders will be approving HBOA Holdings,
Inc.'s articles of incorporation and bylaws. This summary is not intended to be
relied upon as an exhaustive list of all such differences or a complete
description of the provisions discussed, and is qualified in its entirety by
reference to Colorado Law, the Florida Act and the e form of the articles of
incorporation and bylaws of HBOA Holdings, Inc.
ACTION BY WRITTEN CONSENT
Florida
Under the Florida Act, unless otherwise provided in a corporation's articles of
incorporation, any action that may be taken at any annual or special meeting of
shareholders may be taken without a meeting and without prior notice, if a
consent in writing, setting forth the action so taken, is signed by the holders
of outstanding shares having not less than the minimum number of votes that
would be necessary to authorize such action at a meeting at which all shares
entitled to vote thereon were present and voted.
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Colorado
The Colorado Act requires each and every shareholder entitled to vote on the
matter to consent to the action in writing. Therefore, for the shareholders to
approve an action in writing, the vote would have to be unanimous.
AFFILIATED TRANSACTIONS AND CONTROL SHARE ACT
Florida
Florida has enacted legislation that may deter or frustrate takeovers of Florida
corporations. The Florida Affiliated Transaction Act generally requires
supermajority approval by disinterested shareholders of certain specified
transactions between a public corporation and holders of more than 10% of
outstanding voting shares of a corporation (or their affiliates). The Florida
Control Share Act generally provides that shares acquired in excess of certain
specified thresholds will not possess any voting rights unless such voting
rights are approved by a majority of a corporation's disinterested shareholders.
In its Articles of Incorporation, HBOA. Holdings, Inc. has elected not to be
governed by the Affiliated Transaction Act or the Control Share Act.
Colorado
Colorado law has no apparent counterpart to the Florida Act in this regard.
OTHER CONSTITUENCIES
Florida
The Florida Act provides that directors of a Florida corporation, in discharging
their fiduciary duties to the corporation, may consider the social, economic,
legal or other effects of corporate action on the employees, suppliers and
customers of the corporation or its subsidiaries and the communities in which
the corporation and its subsidiaries operate, in addition to the effect on
shareholders.
Colorado
Colorado law has no apparent counterpart to the Florida Act in this regard.
REMOVAL OF DIRECTORS
Florida
The Florida Act provides that the shareholders may remove one or more directors
with or without cause unless the articles of incorporation provide otherwise.
Such removal may be effected at a meeting of shareholders if the number of votes
cast to remove the director exceeds the number of votes cast not to remove him
or her.
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Colorado
The Colorado Act is similar to the Florida Act with regards to removal except
that the Colorado Act requires:
o If a director is elected by a voting group of shareholders, only the
shareholders in the voting group may participate in voting to remove
the director;
o If cumulative voting is used, the director will not be removed if the
number of votes cast would be sufficient to elect the director; and
o The director can only be removed at a special meeting called for the
purpose of removing the director, and such notice of the meeting
states that the purpose of the meeting is to remove the director.
Additionally, a director may be removed by a court in a suit brought by either
the corporation or at least 10% of the shareholders if the director engaged in
fraudulent or dishonest conduct or gross abuse of authority or discretion with
respect to the corporation, and such removal is in the best interests of the
corporation.
DISSENTERS' RIGHTS
Florida
Under the Florida Act, dissenting shareholders who follow prescribed statutory
procedures are, in certain circumstances, entitled to appraisal rights in the
case of:
o a merger or consolidation;
o a sale or exchange of all of substantially all the assets of a
corporation;
o amendments to the articles of incorporation that adversely affect the
rights or preferences of shareholders;
o consummation of a plan of share exchange if the shareholder is
entitled to vote on the plan; and
o the approval of a control share acquisition pursuant to Florida law.
Such rights are not provided when:
o such shareholders are shareholders of a corporation surviving a merger
or consolidation where no vote of the shareholders is required for the
merger or consolidation; or
o shares of the corporation are listed on a national securities
exchange, designated as a national market security by the National
Association of Securities Dealers, Inc., or held of record by more
than 2,000 shareholders.
Colorado
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The Colorado Act is similar to the Florida Act, except that it does not give
appraisal rights to shareholders for amendments to the articles of incorporation
that adversely affect the rights or preferences of shareholders.
AMENDMENT TO ARTICLES
Florida
Under the Florida Act, unless a Florida corporation's articles of incorporation
or the board of directors requires a greater vote, an amendment to a Florida
corporation's articles of incorporation generally requires that the votes cast
in favor of the amendment exceed the votes cast against the amendment.
Colorado
The Colorado Act is substantially similar to the Florida Act with respect to
shareholder votes for amendments, except the Colorado Act allows the bylaws to
change the requisite vote for approval of an amendment, and holders of shares of
a class are entitled to vote as a separate voting group if the amendment would:
o Change the aggregate number of authorized shares of a class;
o Effect an exchange or reclassification of all or part of the shares of
the class into shares of another class;
o effect an exchange or reclassification, or create the right of
exchange, of all or part of the shares of another class into shares of
the class;
o change the designation, preferences, limitations, or relative rights
of all or part of the shares of the class;
o change the shares of all or part of the class into a different number
of shares of the same class;
o Create a new class of shares having rights or preferences with respect
to distributions or dissolution that are prior, superior, or
substantially equal to the shares of the class;
o Increase the rights, preferences, or number of authorized shares of
any class that, after giving effect to the amendment, have rights or
preferences with respect to distributions or to dissolution that are
prior, superior, or substantially equal to the shares of the class;
o Limit or deny an existing preemptive right of all or part of the
shares of the class; or
o Cancel or otherwise affect rights to distributions or dividends that
have accumulated but have not yet been declared on all or part of the
shares of the class.
AMENDMENT TO BYLAWS
Florida
The Florida Act provides that the shareholders, as well as the directors, may
amend the bylaws, unless such power is reserved to the shareholders by the
articles of incorporation or by specific action of the shareholders.
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Colorado
The Colorado Act is similar to the Florida Act.
LIABILITY OF DIRECTORS
Florida
Under the Florida Act, a director is not personally liable for monetary damages
to the corporation or any other person for any statement, vote, decision or
failure to act, regarding corporate management or policy, by a director unless
the director breached or failed to perform his duties as a director and such
breach or failure constitutes:
o a violation of criminal law unless the director had reasonable cause
to believe his conduct was lawful or had no reasonable cause to
believe his conduct was unlawful;
o a transaction from which the director derived an improper personal
benefit;
o a circumstance resulting in an unlawful distribution;
o in a proceeding by or in the right of the corporation to procure a
judgment in its favor or by or in the right of a shareholder,
conscious disregard for the best interests of the corporation or
willful misconduct; or
o in a proceeding by or in the right of one other than the corporation
or a shareholder, recklessness or an act or omission which was
committed in bad faith or with malicious purpose or in a manner
exhibiting wanton and willful disregard of human rights, safety, or
property.
Colorado
A director under the Colorado Act would not be liable for actions taken as a
director unless:
o The director breached their duties to the corporation;
o Actions not in good faith or involve intentional misconduct or a
knowing violation of law;
o a circumstance resulting in an unlawful distribution; or
o the Director received an improper personal benefit.
INDEMNIFICATION
Florida
The Florida Act provides that a corporation may indemnify directors and
officers, as well as other employees and agents, along with a director, officer,
employee or agent against of another corporation, partnership, joint venture,
trust, or other enterprise, against expenses incurred in legal proceedings
connected with their service to the corporation, if he or she acted in good
faith and in a manner he or she reasonably believed to be in, or not opposed to,
the best interests of the corporation and, had no reasonable cause to believe
his or her conduct was unlawful.
Colorado
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The Colorado Act is substantially similar to the Florida Act.
DERIVATIVE ACTIONS
Florida
The Florida Act provides that:
o a person may not bring a derivative action unless the person was a
shareholder of the corporation at the time of the challenged
transaction or unless the stock thereafter devolved on such person by
operation of law;
o a complaint in a derivative proceeding must allege with particularity
the efforts made by a person, if any, to obtain the desired action
from the directors or comparable authority and the reason for the
failure to obtain such action or for not making the effort;
o a derivative proceeding may be settled or discontinued only with a
court approval;
o the court may dismiss a derivative proceeding if it finds that a
committee of independent directors have acted independently and in
good faith after a reasonable investigation and have demonstrated a
reasonable basis for its determination that the action should be
dismissed;
o a complaint in a derivative proceeding must be verified and must
allege with particularity that a demand was made to obtain action by
the board of directors and that the demand was refused or ignored; and
o if an action was brought without reasonable cause, the court may
require the plaintiff to pay the corporation's reasonable expenses.
Colorado
The Colorado Act contains no corresponding provision as to the Florida control
share acquisition. The Colorado Rules of Civil Procedure provide that in a
derivative action brought by one or more shareholders or members to enforce the
right of a corporation when the corporation failed to enforce a right which may
probably be asserted by it. A filed complaint shall be verified and allege with
particularity the efforts, if any, made by the plaintiff shareholder to obtain
the action he desires from the directors and if necessary from the shareholders
and the reasons for his failure to obtain the action or not making the effort.
The derivative action may not be maintained if it appears that the shareholder
does not fairly and adequately represent the interest of the shareholders
similarly situated in enforcing the right of the corporation. The action shall
not be dismissed or compromised without the approval of the court.
DISTRIBUTIONS, REDEMPTIONS, LIQUIDATION AND DISSOLUTION
Florida
A Florida corporation may make distributions to shareholders as long as, after
giving effect to such distribution, (1) the corporation would be able to pay its
debts as they become due in the
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usual course of business, and (2) the corporation's total assets would not be
less than the sum of its total liabilities plus (unless the articles of
incorporation permit otherwise) the amount that would be needed if the
corporation were to be dissolved at the time of the distribution to satisfy the
preferential rights upon dissolution of shareholders whose preferential rights
are superior to those receiving the distribution.
Colorado
The Colorado Act provides for a substantially similar provision for
distribution, redemptions, liquidation and dissolution of the company.
SHAREHOLDER INSPECTION RIGHTS
Florida
Under the Florida Act, a shareholder is entitled to inspect and copy the
articles of incorporation, bylaws, certain board and shareholder resolutions,
certain written communications to shareholders, a list of the names and business
addresses of the corporation's directors and officers, and the corporation's
most recent annual report during regular business hours if the shareholder gives
at least five business days' prior written notice to the corporation. In
addition, a shareholder of a Florida corporation is entitled to inspect and copy
other books and records of the corporation during regular business hours if the
shareholder gives at least five business days' prior written notice to the
corporation, and
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o the shareholder's demand is made in good faith and for a proper
purpose,
o the demand describes with particularity its purpose and the records to
be inspected or copied, and
o the requested records are directly connected with such purpose. The
Florida Act also provides that a corporation may deny any demand for
inspection if the demand was made for an improper purpose or if the
demanding shareholder has, within two years preceding such demand,
sold or offered for sale any list of shareholders of the corporation
or any other corporation, has aided or abetted any person in procuring
a list of shareholders for such purpose or has improperly used any
information secured through any prior examination of the records of
the corporation or any other corporation.
Colorado
The Colorado Act provides for similar inspection rights as the Florida Act, but
with the following modifications:
I. The shareholder may also inspect excerpts from minutes of any meeting
of the board of directors "from records of any action taken by the
board of directors without a meeting, minutes of any meeting of a
shareholders, or records of any actions taken by the shareholders
without a meeting; excerpts of records of any action of a committee of
the board of directors while acting in the place of the board of
directors on behalf of the corporation; and waiver of notices of any
meeting of the shareholders or the board of directors or any committee
of the board of directors; accounting records of the corporation and
the record list of the shareholders";
II. A shareholder must be a shareholder for at least three months
immediately preceding the demand to inspect the records of the
corporation.
TREASURY STOCK
Florida
A Florida corporation may reacquire its own issued and outstanding capital
stock. Under the Florida Act, however, all capital stock reacquired by a Florida
corporation is automatically returned to the status of authorized but not issued
or outstanding, and is not deemed treasury stock.
Colorado
The Colorado Act is substantially similar to the Florida Act in this regard.
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Vote Required and Recommendation
The affirmative vote (either in person or by proxy) at the meeting of
the holders of a majority of our common stock is required to approve the merger
agreement and resulting reincorporation in Florida and name change to HBOA
Holdings, Inc.
Gary Verdier, the majority shareholder of Mizar who owns approximately
60.5% of Mizar's issued and outstanding common stock, has stated that he will
vote in favor of the reincorporation and name change proposal. Accordingly,
approval of the reincorporation and name change proposal is assured.
The Board recommends shareholders to vote "for" the resolution set
forth above.
PROPOSAL 2. APPROVAL OF OUR EQUITY COMPENSATION PLAN
On October 10, 2000, our Board of Directors adopted the Mizar Energy
Company dba HBOA Holdings, Inc. - Equity Compensation Plan (the "Plan").
The purpose of the Plan to provide additional incentive through stock ownership
to attract and retain qualified corporate managers, upon whose efforts and
judgements the success of Mizar is largely dependent.We have reserved 2,700,000
shares of our common stock to be granted under the Plan. Awards under the Plan
may consist of incentive stock options, nonqualified stock options and
restricted stock grants.
One of the reasons for submitting the Plan for shareholder approval is
so that the Plan qualifies an incentive stock option plan under Section 422 of
the Internal Revenue Code ("IRC"). Section 422 of the IRC requires that all
incentive stock option plans be approved by the shareholders of a company,
within twelve months after the Board of Directors adopts the stock option plan.
The Plan is set forth in full as Exhibit C to this Proxy Statement and reference
is made thereto for a complete statement of its terms and provisions. The
principal features of the Plan are discussed below.
Summary of the Plan
The Plan is administered by either the entire Board of Directors of
Mizar or a committee designated by the Board consisting of not less than two
directors, which directors shall qualify as "non-employee directors" under Rule
16b-3 of the Exchange Act. Both the Board and the committee have the power to
determine who should be awarded options and restricted stock grants, the number
of shares to be granted and the exercise price of the options and other terms.
In addition, both the Board and the committee have the power and authority to
construe and interpret the Plan, and the acts of the Board or the committee are
final, conclusive and binding upon all interested parties, including recipients
of grants under the Plan, and all persons or entities claiming by or through
such persons.
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Options. As of October 10, 2000, 1,250,000 options have been granted
under the Plan. If any option granted under the Plan should expire or terminate
for any reason other than having been exercised in full, the unpurchased shares
subject to that options will again be available for purposes of the Plan. The
exercise price of an incentive stock option must be at least equal to the fair
market value of the Mizar's common stock on the date of grant (or 110% of such
value in the case of options granted to an individual who is a 10% shareholder
of Mizar).
All grants of options under the Plan must be evidenced by an option agreement
between Mizar and the grantee. Such agreement shall contain such terms and
conditions as the Board of the committee shall prescribe, consistent with the
Plan, including, without limitation, the exercise price, option term and any
restrictions on the exercisability of the options granted. In each grant
agreement, Mizar will specify the conditions under which each optionee can
exercise options after his/her employment is terminated with Mizar. Although
individual grant agreements may vary, Mizar anticipates that its options will be
subject to the following terms. An optionee may exercise an option only while an
employee of Mizar or one of its subsidiaries. If an optionee becomes disabled or
dies while in the employ of Mizar or a subsidiary, the option may be exercised
within one year of the optionee's death or termination due to disability. The
expiration date of an option will be determined by the board or the committee at
the time of the grant, but in no event will an incentive stock option be
exercisable after the expiration of 10 years from the date of grant (5 years in
the case of incentive options granted to a 10% shareholder of Mizar).
The Plan does not limit the aggregate number of shares which may be
granted to any one employee in any single year. However, the maximum value of
grants that vest in a calendar year is limited to $100,000 for each employee.
The Plan provides for appropriate adjustment of the number of shares available
for issuance under the Plan, including the number of shares subject to
outstanding options and restricted stock grants and the purchase price thereof,
in the event of reorganizations, stock splits, combinations of shares, stock
dividends or other recapitalizations of the Company.
The exercise price of an option may be paid in any of the following manners:
o -cash;
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o -by certified or official bank check;
o -by money order;
o -by delivery of already owned shares of common stock having a fair
market value equal to the exercise price;
o -by the withholding of shares issuable upon exercise of the option;
o -by such other consideration as the Board or committee deems
appropriate; or
o -by a combination of the foregoing.
Restricted Stock Grants. The Committee may grant an eligible employee
shares of common stock subject to specified restrictions on transferability and
vesting as provided in the Plan.
The Plan will terminate on October 10, 2010. The Board of Directors may at any
time amend, suspend or discontinue the Plan, except that no amendment may be
made without the approval of the shareholders which would increase the number of
shares subject to the Plan, materially change the designation of the class of
employees eligible to receive options, remove the administration of the Plan
from the Board of Directors or the Stock Option Committee or materially increase
the benefits accruing to participants under the Plan.
Federal Income Tax Effects
Incentive Stock Options. An optionee realizes no taxable income upon
either a grant or the exercise of an incentive stock option. If the optionee
disposes of stock acquired upon exercise of the incentive stock option within
two years from the date of grant or within one year from the date of exercise
(disqualifying disposition), the difference between the option price and the
fair market value on the date of exercise (not to exceed the gain recognized on
the sale) will be taxed at ordinary income rates and any gain in excess of such
amount will be a long-term or short-term capital gain, depending on the length
of time the stock was held by the optionee. If the optionee sells the stock
acquired upon exercise of the incentive stock option more than one year after
the date of exercise and more than two years after the date of grant, the
difference between the incentive stock option price and the sales price will be
taxed as long-term capital gain or loss. The spread between the incentive stock
option price and the fair market value of the stock on the date of exercise will
be classified as an item of tax preference for purposes of computing the
alternative minimum tax. We have no tax deduction with respect to the grant or
exercise of an incentive stock option or the sale of stock acquired pursuant to
an incentive stock option under the Plan, except to the extent that an employee
recognizes ordinary income upon a disqualifying disposition of such stock.
Non-Qualified Stock Options. An optionee will not recognize any taxable
income at the time a NQSO is granted. However, upon exercise of a NQSO, the
optionee will include in income as compensation an amount equal to the
difference between the fair market value of the shares on the date of exercise
(in most cases) and the optionee's purchase price. The included amount will be
treated as ordinary income and reported on an employee's W-2 form, or in the
case of a non-employee, on a 1099 form and will be subject to income tax and
FICA withholding by Mizar (either in payment in cash or withholding of the
optionee's slary) if the optionee is an employee. Upon the sale of the shares by
the optionee, any subsequent appreciation or depreciation in the value of the
shares will be treated as short term or long term capital gain or loss depending
upon whether or not the optionee held the shares for more than one year
following exercise of the NQSO. We will be entitled to a deduction in connection
with the exercise of a NQSO by a domestic optioned to the extent that the
optioned recognizes ordinary income provided that the deduction is not
disallowed under the provisions of Section 162(m) of the Code.
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Options Outstanding under the Plan
As of October 10, 2000,we had granted options to purchase 950,000
shares of our common stock to our Chief Executive Officer. The exercise price of
these options is $1.50 per share and were granted to Mr. Saludes as part of his
employment agreement.
The table below indicates, as of October 10, 2000, the aggregate number
of options outstanding under the Plan to each or our named executive officers
and directors and the groups indicated.
Number of Options
Option Grantee Outstanding
-------------- -----------
Edward Saludes
Chief Executive Officer and President .................. 950,000
Gary Verdier
Chairman................................................ 0
William C. Shope
Vice President of Operations............................ 100,000
Harvey Judkowitz
Chief Financial Officer................................. 40,000
All current executive officers as a group
(4 persons)............................................. 1,090,000
All current directors who are not executive officers
as a group.............................................. 0
All employees, other than executive officers
(6 persons)............................................. 160,000
The Board believes that options granted under the Plan have been and
will be awarded primarily to those persons who possess a capacity to contribute
significantly to the successful performance of Mizar. Because persons to whom
grants of options are to be made are to be determined from time to time by the
Board in its discretion, it is impossible at this time to indicate the precise
number of shares for which options will be granted except to the extent already
granted.
Vote Required and Recommendation
To approve Mizar's Year Equity Compensation Plan, a majority of
the shares of common stock present in person or represented by proxy and
entitled to vote at the meeting must be voted in favor of the Plan Proposal.
Abstentions from voting will have the same effect as voting against the proposal
to approve Mizar's Plan. Broker nonvotes will have no impact on the proposal to
approve Mizar's Plan since they are not considered shares entitled to vote.
The Board of Directors recommends a vote "FOR" approval of the Mizar
Energy Company - Year 2000 Incentive Stock
25
<PAGE>
Option Plan
PROPOSAL 3. ELECTION OF DIRECTORS
The six persons set below, each of whom is currently a director, are
proposed to be re-elected as directors at the annual meeting. If elected each of
these directors will hold office until the next annual meeting of shareholders
in the year 2001 or until his or her successor is duly elected and qualified.
Edward Saludes
Gary Verdier
Harvey Judkowitz
Carl Wolf and Marion Wolf
Robert Fivian
All of the nominees are currently directors. Each has agreed to be
named in this proxy statement and to serve as a director if elected. For
biographical information regarding the nominees, see "Management" on pages 5-6
of this proxy.
Vote Required and Recommendation
The nominees for election to the Board of Directors who receive the
greatest number of votes cast for the election of directors by the shares
present, in person or by proxy, shall be elected directors. Shareholders do not
have the right to cumulate their votes for directors. In the election of
directors, an abstention or broker nonvote will have no effect on the outcome.
The Board recommends shareholders to vote "for" each of the nominees
for director set forth above.
SELECTION OF AUDITORS
We retained Sewell and Company, P.A. as our independent accountants on
March 14, 2000. Prior to this time, we had retained Spicer, Jeffries & Co., an
accounting firm based in Denver, Colorado. We did not have any changes in or
disagreements with Spicer, Jeffries & Co. However, on March 14, 2000, we decided
that it was in its best interest to retain an accounting firm that was based in
South Florida and dismissed Spicer, Jeffries & Co. Our decision to change
accountants was based solely on the decision to have a local accounting firm and
was not at all related to the quality of work by Spicer, Jeffries & Co. or any
disagreements with such firm. Effective as of March 14, 2000, we engaged Sewell
and Company, P.A as our new independent accountants. Sewell has offices in
Hollywood, Florida and Pembroke Pines, Florida. We reported our change in
independent accountants in a Form 8-K filed with the SEC on March 16, 2000.
The firm of Sewell and Company, P.A. will be our independent
accountants for our current fiscal year, unless the Board of Directors deems it
advisable to make a substitution. One or more representatives of Sewell and
Company, P.A. is expected to
26
<PAGE>
attend the meeting and will be available to respond to any appropriate
questions. These representatives will be given an opportunity to make statements
at the meeting if they so desire.
ANNUAL REPORT ON FORM 10-KSB
We are mailing copies of our annual report on Form 10-KSB for the
twelve months ended December 31, 1999 with this proxy statement to our
shareholders of record as of October 23, 2000.
INFORMATION CONCERNING SHAREHOLDER PROPOSALS
Shareholders interested in presenting a proposal for consideration at
the 2001 annual meeting of shareholders must submit such proposal to and be
received by us on or before August 10, 2000. If a proposal is not submitted and
received by that date, the persons named in our proxy for the 2001 annual
meeting will be allowed to exercise their discretionary authority to vote upon
any such proposal without the matter having been discussed in the proxy for the
2001 annual meeting.
OTHER MATTERS
As of the date of this proxy statement, we are not aware of any matter
to be presented for action at the meeting other than the matters set forth
above. If any other matter is properly brought before the meeting for action by
shareholders, proxies in the enclosed form returned to us will be voted in
accordance with the recommendation of the Board of Directors, or in the absence
of such a recommendation, in accordance with the judgement of the proxy holders.
By order of the Board of Directors,
MIZAR ENERGY COMPANY
Edward A. Saludes
Chief Executive Officer and President
27
<PAGE>
EXHIBIT A
PLAN AND AGREEMENT OF MERGER
of
MIZAR ENERGY COMPANY, a Colorado corporation
with and into
HBOA HOLDINGS, INC., a Florida corporation
------------------------------------------
This is a Plan and Agreement of Merger ("Agreement") between MIZAR
ENERGY COMPANY, a Colorado corporation (the "Disappearing Corp." or "Mizar"),
and HBOA Holdings, Inc., a Florida corporation (the "Surviving Corp." or
"HBOA"), (collectively the "Constituent Corporations"). A Plan of Merger
("Plan") in accordance with (1) the provisions of Section 7-111 of the Colorado
Business Corporation Act (the "Colorado Business Corporation Act"), and (2)
Section 607.1101 of the Florida Business Corporation Act and (3) Section
368(a)(1)(A) of the Internal Revenue Code, as amended, by reason of Section
368(a)(2)(E) is adopted as follows:
1. Merger. Mizar shall be merged with and into HBOA, to exist and be
governed by the laws of the State of Florida. The name of the Surviving
Corporation shall be HBOA Holdings, Inc., a Florida corporation.
2. Articles of Incorporation, Bylaws, Officers and Directors. The
Articles of Incorporation and Bylaws of Surviving Corp., as in effect
immediately before the Effective Date of the Merger (the "Effective Date")
shall, without any changes, be the Articles of Incorporation of the Surviving
Corp. from and after the Effective Date until further amended as permitted by
law. The persons serving as officers and directors of the Surviving Corp.,
before the Effective Date of the Merger, shall continue to serve as the officers
and directors of the Surviving Corp. after the Effective Date of the Merger.
3. Conversion of Outstanding Stock and Derivative Securities.
---------------------------------------------------------
A. At the Effective Date, each issued and outstanding share of Mizar
common stock and all rights in respect thereof shall be converted into one
fully-paid and nonassessable shares of HBOA common stock, and each certificate
representing shares of Mizar common stock shall for all purposes deemed to
evidence the ownership of the same number of shares of HBOA common stock as set
forth in such certificate. After the Effective Date, each holder of an
outstanding certificate representing shares of Mizar's common stock may, at such
shareholder's option, surrender the same to HBOA's registrat and transfer agent
for cancellation, and each such holder shall be entitled to receive in exchange
therefor a certificate(s) evidencing the ownership of the same number of shares
of HBOA common stock as are represented by the Mizar certificate(s) surrendered
to HBOA's registrar and transfer agent.
A-1
<PAGE>
B. At the Effective Date, each stock option, stock warrant, convertible
debt instrument and other right to subscribe for or purchase shares of Mizar's
common stock shall be converted into a stock option, stock warrant, convertible
debt instrument or other right to subscribe for or purchase the same number of
shares of HBOA common stock, and each certificate, agreement, note or other
document representing such stock option, stock warrant, convertible debt
instrument or other right to subscribe for or purchase shares of Mizar common
stock shall be deemed for all purposes to evidence the ownership of a stock
option, stock warrant, convertible debt instrument or other right to subscribe
for or purchase shares of HBOA common stock.
4. Satisfaction of Rights of Disappearing Corp. Shareholders. All
shares of Surviving Corp.'s stock into which shares of Disappearing Corp.'s
stock shall have been converted and become exchangeable for under this Plan
shall be deemed to have been paid in full satisfaction of such converted shares.
5. Fractional Shares. Fractional shares of HBOA's stock will not be
issued. Any fractional share interest will result in the adjustment of the
number of shares upward or downward to the nearest whole share.
6. Effect of Merger. On the Effective Date, the separate corporate
existence of Disappearing Corp. shall cease, and Surviving Corp. shall be fully
vested in and shall succeed, without other transfer, to all the rights,
privileges, immunities, powers, franchises and property of Disappearing Corp.
and shall be subject to all the debts restrictions, liabilities, disabilities,
and duties of the Disappearing Corp. in the same manner as if the Surviving
Corp. had itself incurred them. The Surviving Corp. will carry on business with
the assets of Disappearing Corp., as well as with the assets of Surviving Corp.
All rights of creditors and all liens on the property of each constituent
corporation shall be preserved unimpaired, limited in lien to the property
affected by the liens immediately prior to the merger.
7. Supplemental Action. If at any time after the Effective Date
Surviving Corp. shall determine that any further conveyances, agreements,
documents, instruments, and assurances or any further action is necessary or
desirable to carry out the provisions of this Plan, the appropriate officers of
Surviving Corp. or Disappearing Corp., as the case may be, whether past or
remaining in office, shall execute and deliver, on the request of Surviving
Corp., any and all proper conveyances, agreements, documents, instruments, and
assurances and perform all necessary or proper acts, to vest, perfect, confirm,
or record such title thereto in Surviving Corp., or to otherwise carry out the
provisions of this Plan.
8. Filing with the Secretary of State of Colorado and Florida Secretary
of State and Effective Date. At the Closing, the Disappearing Corp. and
Surviving Corp. shall cause their respective Chief Executive Officers to execute
and file (1) these Articles of Merger with the Colorado Secretary of State and
(2) Articles of Merger with the Florida Secretary of State (the "Florida
Articles of Merger"), in the form attached to this Agreement and upon such
execution this Plan shall be deemed incorporated by reference into the Colorado
and Florida Articles of Merger as if fully set forth in such Articles and shall
become an exhibit to such Articles. The Disappearing Corp. shall file this Plan
in its Articles of Merger with the Colorado Secretary of State. After the
Colorado Secretary of State issues a certificate of Merger, the Surviving
Corporation shall file the Florida Articles of Merger with the Florida Secretary
of State. In accordance with s. 607.1105 of the Act, the Florida Articles of
Merger shall specify the "Effective Date," which shall be the filing date of the
Florida Articles of Merger with the Secretary of State of Florida.
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9. Amendment and Waiver. Any of the terms or conditions of this Plan
may be waived at any time by the one of the Constituent Corporations which is,
or the shareholders of which are, entitled to the benefit thereof by action
taken by the Board of Directors of such party, or may be amended or modified in
whole or in part at any time before the vote of the shareholders of the
Constituent Corporations by an agreement in writing executed in the same manner
(but not necessarily by the same persons), or at any time thereafter as long as
such change is in accordance with Section 607.1103 of the Florida Act and the
Colorado Business Corporation Act.
10. Termination. At any time before the Effective Date (whether before
or after filing of Articles of Merger), this Plan may be terminated and the
Merger abandoned by mutual consent of the Boards of Directors of both
Constituent Corporations, notwithstanding favorable action by the shareholders
of the respective Constituent Corporations.
11. Registered Office. The registered office of HBOA in the State of
Florida is located at 100 N.E. Third Avenue, Suite 1100, ft. Lauderdale, FL
33301, and English, McCaughan & O'Bryan, P.A. is the registered agent of HBOA at
such address.
12. Counterparts. This Plan of Merger may be executed in any number of
counterparts, each of which shall constitute an original instrument.
IN WITNESS WHEREOF, the parties have set their hands this __day of
October 2000.
ATTEST: HBOA HOLDINGS, INC., a Florida corporation
By:____________________________ By:______________________________________
Edward A. Saludes
Chief Executive Officer
(Corporate Seal)
ATTEST: MIZAR ENERGY COMPANY, a Colorado corporation
By:____________________________ By:______________________________________
Edward A. Saludes
Chief Executive Officer
(Corporate Seal)
A-3
<PAGE>
EXHIBIT B
---------
ARTICLES OF INCORPORATION
OF
HBOA HOLDINGS, INC.,
A FLORIDA CORPORATION
The undersigned, acting as Incorporator of HBOA HOLDINGS, INC., a
Florida corporation (the "Corporation") under the Florida Business Corporation
Act, Chapter 607 of the Florida Statutes, hereby adopts the following Articles
of Incorporation for such Corporation:
ARTICLE I
---------
NAME
----
The name of the Corporation is HBOA HOLDINGS, INC. and the street
address of the initial principal office of the Corporation is 2400 East
Commercial Blvd., Suite 221, Fort Lauderdale, FL 33316.
ARTICLE II
----------
PURPOSE
-------
The Corporation is organized for the purpose of transacting any and all
lawful business for which corporations may be incorporated under the laws of the
State of Florida.
ARTICLE III
-----------
CAPITAL STOCK
-------------
The Corporation is authorized to issue Twenty Million (20,000,000)
shares of Common Stock, par value $.001 per share, and Ten Million (10,000,000)
shares of Preferred Stock, par value $.001 per share.
The designations and the preferences, limitations and relative rights
of the Preferred Stock and the Common Stock of the Corporation are as follows:
B-1
<PAGE>
Provisions Relating to the Preferred Stock.
-------------------------------------------
1. The Preferred Stock may be issued from time to time in one or more
classes or series, the shares of each class or series to have such designations
and powers, preferences and rights, and qualifications, limitations and
restrictions thereof as are stated and expressed herein and in the resolution or
resolutions providing for the issuance of such class or series adopted by the
Board of Directors as hereinafter prescribed.
2. Authority is hereby expressly granted to and vested in the Board of
Directors to authorize the issuance of the Preferred Stock from time to time in
one or more classes or series, to determine and take necessary proceedings fully
to effect the issuance and redemption of any such Preferred Stock, and, with
respect to each class or series of Preferred Stock, to fix and state by the
resolution or resolutions from time to time adopted providing for the issuance
thereof the following:
a. whether or not the class or series is to have voting
rights, full or limited, or is to be without voting rights;
b. the number of shares to constitute the class or series and
the designations thereof;
c. the preferences and relative, participating, optional or
other special rights, if any, and the qualifications, limitations or
restrictions thereof, if any, with respect to any class or series;
d. whether or not the shares of any class or series shall be
redeemable and if redeemable the redemption price or prices, and the time or
times at which and the terms and conditions upon which, such shares shall be
redeemable and the manner of redemption;
e. whether or not the shares of a class or series shall be
subject to the operation of retirement or sinking funds to be applied to the
purchase or redemption of such shares for retirement, and if such retirement or
sinking fund or funds shall be established, the annual amount thereof and the
terms and provisions relative to the operation thereof;
f. The dividend rate, if any, whether any, whether any such
dividends are payable in cash, stock of the corporation or other property, the
conditions upon which and the times when any such dividends are payable, the
preference to or the relation to the payment of the dividends, payable on any
other class or classes or series of stock, whether or not such dividend shall be
cumulative or noncumulative, and if cumulative, the date or dates from which
such dividends shall accumulate;
g. the preferences, if any, and the amounts thereof which the
holders of any class or series thereof shall be entitled to receive upon the
voluntary or involuntary dissolution of, or upon any distribution of the assets
of, the corporation;
B-2
<PAGE>
h. whether or not the shares of any class or series shall be
convertible into, or exchangeable for, the shares of any other class or classes
or of any other series of the same or any other class or classes of stock of the
corporation and the conversion price, ratio or rate at which such conversion or
exchange may be made, with such adjustments, if any, as shall be stated and
expressed or provided for in such resolution or resolutions; and
i. such other special rights and protective provisions with
respect to any class or series as the Board of Directors may deem advisable and
in the best interests of the Company.
The shares of each class or series of Preferred Stock may vary from the
shares or any other series thereof in any or all of the foregoing respects. The
Board of Directors may increase the number of shares of Preferred Stock
designated for any existing class or series by a resolution adding to such class
or series authorized and unissued shares of Preferred Stock not designated for
any other class or series. The Board of Directors may decrease the number of
shares of Preferred Stock designated for any existing class or series by a
resolution, subtracting from such series unissued shares of Preferred Stock
designated for such class or series, and the shares so subtracted shall become
authorized, unissued and undesignated shares of Preferred Stock.
Provisions to the Common Stock.
1. Except as otherwise required by law or as may be provided by the
resolutions of the Board of Directors authorizing the issuance of any class or
series of Preferred Stock, as herein above provided, all rights to vote and all
voting power shall be vested exclusively in the holders of Common Stock.
2. Subject to the rights of the holders of the Preferred Stock, the
holders of Common Stock shall be entitled to receive when, as and if declared by
the Board of Directors, out of funds legally available therefor, dividends
payable in cash, stock or otherwise.
3. Upon any liquidation, dissolution or winding-up of the corporation,
whether voluntary or involuntary, and after the holders of the Preferred Stock
shall have been paid in full the amounts to which they shall be entitled (if
any) or a sum sufficient for such payment in full shall have been set aside, the
remaining net assets of the corporation shall be distributed pro rata to the
holders of the Common Stock in accordance with their respective rights and
interests to the exclusion of the holders of the Preferred Stock.
General Provisions.
1. Except as may be provided by the resolutions of the Board of
Directors authorizing the issuance of any class or series of Preferred Stock, as
hereinabove provided, cumulative voting by any shareholder is hereby expressly
denied.
B-3
<PAGE>
2. No shareholder of this corporation shall have, by reason of its
holding shares of any class or series of stock of the corporation, any
preemptive rights to purchase or subscribe for any other shares of any class or
series of this corporation now or hereafter authorized, and any other equity
securities, or any notes, debentures, warrants, bonds, or other securities
convertible into or carrying options or warrants to purchase shares of any
class, now or hereafter authorized, whether or not the issuance of any such
shares, or such notes, debentures, bonds or other securities, would adversely
affect the dividend or voting rights of such shareholder.
ARTICLE IV
----------
ELECTION NOT TO BE GOVERNED BY
------------------------------
THE AFFILIATED TRANSACTION STATUTE
----------------------------------
Pursuant to Section 607.0901(5) of the Florida Business Corporation
Act, the Corporation expressly elects not to be governed by the provisions of
Section 607.0901(5) of the Florida Business Corporation, Act, the Corporation
expressly elects not to be governed by the provisions of Section 607.0901 of the
Florida Business Corporation Act with respect to any affiliated transaction (as
defined therein).
ARTICLE V
---------
ELECTION NOT TO BE GOVERNED BY
------------------------------
THE CONTROL SHARE ACT
---------------------
Pursuant to Section 607.0902(5) of the Florida Business Corporation
Act, the Corporation expressly elects not to be governed by the provisions of
Section 607.0902 of the Florida Business Corporation Act with respect to any
control-share acquisition (as defined therein).
ARTICLE VI
----------
INITIAL REGISTERED OFFICE AND AGENT
-----------------------------------
The street address of the initial registered office of the Corporation
is 100 Northeast Third Avenue, Suite 1100, Fort Lauderdale, Florida 33301, and
the name of the initial Registered Agent of the Corporation at that address is
EMO Corporate Services, Inc.
B-4
<PAGE>
ARTICLE VII
-----------
INCORPORATOR
------------
The name and address of the Incorporator of the Corporation is:
Name Address
Laura M. Holm, Esquire English, McCaughan & O'Bryan, P.A.
100 Northeast Third Avenue
Suite 1100
Fort Lauderdale, FL 33301
IN WITNESS WHEREOF, the undersigned Incorporator has executed these
Articles of Incorporation this 11 day of October, 2000.
/s/ Laura Holm
-------------------------------------
LAURA M. HOLM, Incorporator
B-5
<PAGE>
ACCEPTANCE OF DESIGNATION AS REGISTERED AGENT
---------------------------------------------
Having been named as Registered Agent to accept service of process for
HBOA HOLDINGS, INC. at the place designated in the foregoing Articles of
Incorporation, we hereby accept the appointment as Registered Agent and agree to
act in this capacity. We further agree to comply with the provisions of the
Florida Business Corporation Act relating to the proper and complete performance
of our duties, and we are familiar with and accept the obligations of our
position as Registered Agent.
EMO CORPORATE SERVICES, INC.,
Initial Registered Agent
Dated: October 11, 2000 By: /s/ Patricia L. Donahoe
----------------------------------------
Patricia L. Donahoe, Assistant Secretary
B-6
<PAGE>
B Y - L A W S
OF
HBOA HOLDINGS, INC.
ARTICLE I
Offices
In addition to the office of the corporation registered with the
Secretary of State of Florida, the corporation may also have offices at such
places, both within and without the State of Florida, as the Board of Directors
may from time to time determine or the business of the corporation may require.
ARTICLE II
Shareholders
Section 1. ANNUAL MEETING. A meeting of shareholders shall be held
annually between the third and sixth month, inclusive, of each fiscal year of
the corporation for the purpose of electing directors, and for transacting any
other business coming before the meeting. If the election of directors is not
held on the day so determined for any annual meeting of the shareholders, or at
any adjournment thereof, the Board of Directors shall cause the election to be
held at a special meeting of the shareholders as soon thereafter as convenient.
Section 2. SPECIAL MEETINGS. Special meetings of the shareholders, for
any purpose or purposes, unless otherwise prescribed by law or by the Articles
of Incorporation, may be called by the Chairman of the Board, if any, the
President or by the Board of Directors, and shall be called by the President or
Secretary at the written request of a majority of the Board of Directors then in
office or at the written request of the holders of not less than one-tenth
(1/10th) of all the votes entitled to be cast on any issue proposed for
consideration at the meeting. Such request shall state the purpose or purposes
of the proposed meeting. Business transacted at any special meeting shall be
limited to the purposes described in the special meeting notice required by
Section 4 of this Article.
Section 3. PLACE OF MEETING. The Board of Directors may designate any
place, either within or without the State of Florida, as the place of meeting
for any annual or special meeting of the shareholders. If no designation is
made, the meeting place shall be the principal office of the corporation unless
the notice of the meeting specifies otherwise.
Section 4. NOTICE OF MEETING. Written or printed notice stating the
date, time and place of the meeting and, in the case of a special meeting, a
description of the purpose or purposes for which the meeting is called, shall be
delivered to the shareholders entitled to vote thereat, not less than ten (10)
days nor more than sixty (60) days before the date of the meeting, either
personally or
B-7
<PAGE>
by first class mail, by or at the direction of the President or the Secretary,
or, in the case of a special meeting, by the officers and or persons designated
to call such special meeting in accordance with Section 2 of this Article II. If
the notice is mailed at least thirty (30) days before the date of the meeting,
it may be done by a class of United States mail other than first class. If
mailed, such notice shall be deemed to be delivered when deposited in the United
States mail, addressed to the shareholder at his address as it appears on the
stock transfer books of the corporation, with postage thereon prepaid. If an
annual or special meeting of shareholders is adjourned to a different date, time
or place, notice of the new date, time or place need not be given if same is
announced at the meeting before an adjournment is taken, and any business may be
transacted at the adjourned meeting that might have been transacted on the
original date of the meeting. If a new record date for the adjourned meeting is
or must be fixed under Section 2 of Article X of these By- laws, notice of the
adjourned meeting must be given to persons who are shareholders as of the new
record date who are entitled to notice of the meeting. Notwithstanding the
foregoing, no notice of a shareholders' meeting need be given to a shareholder
if: (a) An annual report and proxy statements for two consecutive annual
meetings of shareholders or (b) All, and at least two checks in payment of
dividends or interest on securities during a 12-month period, have been sent by
first-class United Sates mail, addressed to the shareholder at his address as it
appears on the share transfer books of the corporation, and returned
undeliverable. The obligation of the corporation to give notice of a
shareholders' meeting to any such shareholder shall be reinstated once the
corporation has received a new address for such shareholder for entry on its
share transfer books.
Section 5. WAIVER OF NOTICE OF SHAREHOLDERS' MEETING. (a) Whenever any
notice is required to be given to any shareholder of the corporation under the
provisions of law, the Articles of Incorporation or these By-laws, a written
waiver thereof signed by the person or persons entitled to such notice and
delivered to the corporation, before or after the date and time stated therein,
shall be equivalent to the giving of such notice. Unless otherwise provided in
the Articles of Incorporation, neither the business to be transacted at, nor the
purpose of, any regular or special meeting of the shareholders need be specified
in any written waiver of notice.
(b) Attendance of a shareholder at a meeting waives objection to: (1)
lack of notice or defective notice of the meeting, unless the shareholder
objects at the beginning of the meeting to holding the meeting or transacting
business at the meeting; or (2) the consideration of a particular matter at the
meeting that is not within the purpose or purposes described in the meeting
notice, unless the shareholder objects to considering the matter when it is
presented.
Section 6. SHAREHOLDERS' LIST. (a) After fixing a record date for a
meeting of the shareholders, the officer or agent having charge of the stock
transfer books for shares of the corporation shall prepare, at least ten (10)
days before such meeting of shareholders, an alphabetical list of the names of
the shareholders entitled to notice of such meeting, arranged by voting group,
with the address of, and the number and class and series, if any, of shares held
by each.
(b) For a period of ten (10) days prior to the meeting, or such shorter
time as exists between the record date and the meeting (and continuing through
the meeting), the shareholders' list shall be available for inspection by any
shareholder during regular business hours at the corporation's principal office,
at a place identified in the meeting notice in the city where the meeting is to
be held,
B-8
<PAGE>
or at the office of the corporation's transfer agent or registrar. A shareholder
or the shareholder's agent or attorney is entitled on written demand to inspect
and copy the list during regular business hours at his expense, during the
period it is available for inspection; provided, that (i) the shareholder's
demand is made in good faith and for a proper purpose, (ii) the shareholder
describes with reasonable particularity his purpose and the records he desires
to inspect; and (iii) the records are directly connected with the shareholder's
purpose. Such list shall also be available at the meeting and shall be subject
to inspection by any shareholder, or the shareholder's agent or attorney, at any
time during the meeting or any adjournment thereof. The shareholders' list shall
be prima facie evidence of the identity of shareholders entitled to examine such
list or to vote at a meeting of shareholders. A shareholder may not sell or
otherwise distribute any information or records inspected under this Section,
except as otherwise permitted by law.
Section 7. SHAREHOLDER QUORUM AND VOTING. (a) Unless otherwise provided
in the Articles of Incorporation, a majority of the shares entitled to vote,
represented in person or by proxy, shall constitute a quorum at a meeting of
shareholders, but in no event shall a quorum consist of less than one-third
(1/3) of the shares entitled to vote at the meeting. When a specified item of
business is required to be voted on by a class or series of stock, a majority of
the shares of such class or series shall constitute a quorum for the transaction
of such item of business by that class or series.
(b) If a quorum exists, action on a matter, other than the election of
directors, is approved if the votes cast by the holders of the shares
represented at the meeting (and entitled to vote on the subject matter) favoring
the action exceed the votes cast opposing the action, unless a greater number of
affirmative votes or voting by classes is required by law or the Articles of
Incorporation.
(c) Unless otherwise provided in the Articles of Incorporation,
directors shall be elected by a plurality of the votes cast by the shares
entitled to vote in the election at a meeting at which a quorum is present. Each
shareholder who is entitled to vote at an election of directors may vote (in
person or by proxy) the number of shares owned by him for as many persons as
there are directors to be elected at that time and for whose election he has a
right to vote. Shareholders shall not have a right to cumulate their votes for
directors unless the Articles of Incorporation so provide.
(d) After a quorum has been established at a shareholders' meeting, the
subsequent withdrawal of shareholders, so as to reduce the number of shares
entitled to vote at the meeting below the number required for a quorum, shall
not affect the validity of any action taken at the meeting or any adjournment
thereof.
Section 8. VOTING ENTITLEMENT OF SHARES. (a) Except as provided in
Section 8(b) of this Article or unless otherwise provided by law or the Articles
of Incorporation, each outstanding share, regardless of class, shall be entitled
to one vote on each matter submitted to a vote at a meeting of shareholders.
Only shares are entitled to vote. If the Articles of Incorporation provide for
more or less than one vote for any share on any matter, each reference in these
By-laws to a majority or other proportion of shares shall refer to such a
majority or other proportion of votes entitled to be cast.
B-9
<PAGE>
(b) Shares which have been reacquired or redeemed by the corporation
shall not be voted, directly or indirectly, at any meeting, and shall not be
counted in determining the total number of outstanding shares at any given time.
Shares of this corporation's own stock are not entitled to vote if they are
owned (directly or indirectly) by another corporation and this corporation owns
(directly or indirectly) a majority of the shares entitled to vote for directors
of that other corporation. This shall not limit the power of the corporation to
vote any shares, including its own shares, held by it in a fiduciary capacity.
Section 9. PROXIES. A shareholder, those persons entitled to vote on
behalf of a shareholder pursuant to law, or a shareholder's attorney-in-fact may
vote a shareholder's shares in person or by proxy. A shareholder may appoint a
proxy to vote or otherwise act for him by signing an appointment form, either
personally or by his attorney-in-fact. An appointment of a proxy shall be
effective when received by the Secretary or other officer of the corporation
authorized to tabulate votes and shall be valid for up to eleven (11) months
unless a longer period is expressly provided in the appointment form. A proxy
holder may appoint, in writing, a substitute to act in his place, if the
appointment form expressly so permits.
Section 10. INSPECTORS OF ELECTIONS. Prior to each shareholders'
meeting, the Board of Directors or the President shall appoint one or more
Inspectors of Elections. Upon his appointment, each such Inspector shall take
and sign an oath to faithfully execute the duties of Inspector at such meeting
with strict impartiality and to the best of his ability. Such Inspectors shall
determine the number of shares outstanding, the number of shares present at the
meeting and whether a quorum is present at such meeting. The Inspectors shall
receive votes and ballots and shall determine all challenges and questions as to
the right to vote and shall thereafter count and tabulate all votes and ballots
and determine the result. Such Inspectors shall do such further acts as are
proper to conduct the elections of directors and the vote on other matters with
fairness to all shareholders. The Inspectors shall make a certificate of the
results of the elections of directors and the vote on other matters. No
candidate for election as a director of the corporation shall be appointed as an
Inspector.
Section 11. ACTION BY SHAREHOLDERS WITHOUT A MEETING. (a) Unless
otherwise provided in the Articles of Incorporation, any action required or
permitted by law to be taken at an annual or special meeting of shareholders may
be taken without a meeting, without prior notice and without a vote, if the
action is taken by the holders of outstanding stock of each voting group
entitled to vote thereon having not less than the minimum number of votes with
respect to each voting group that would be necessary to authorize or take such
action at a meeting at which all voting groups and shares entitled to vote
thereon were present and voted.
(b) In order to be effective, the action must be evidenced by one or
more written consents describing the action taken, dated and signed by approving
shareholders having the requisite number of votes of each voting group entitled
to vote thereon, and delivered to the corporation within sixty (60) days of the
date of the written consent.
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(c) Any written consent may be revoked prior to the date the
corporation receives the required number of consents to authorize the proposed
action. No revocation is effective unless in writing and received by the
corporation.
(d) Within ten (10) days after obtaining such authorization by written
consent, notice must be given to those shareholders who have not consented in
writing or who are not entitled to vote on the action. The notice shall fairly
summarize the material features of the authorized action and, if the action is a
merger, consolidation, sale or exchange of assets, or other action for which
dissenter's rights are provided by law, the notice shall contain a clear
statement of the right of dissenting shareholders to be paid the fair value of
their shares upon compliance with further provisions of law regarding the rights
of dissenting shareholders.
Section 12. VOTING TRUSTS. Any number of shareholders of this
corporation may create a voting trust in the manner provided by law for the
purpose of conferring upon the trustee or trustees the right to vote or
otherwise represent their shares. When the counterpart of a voting trust
agreement and a copy of the record of the holders of voting trust certificates
are deposited with the corporation as provided by law, those documents shall be
subject to the same right of examination by a shareholder of the corporation, in
person or by agent or attorney, as are the books and records of the corporation,
and the counterpart and the copy of the record shall be subject to examination
by any holder of record of voting trust certificates, either in person or by
agent or attorney, at any reasonable time for any proper purpose.
Section 13. SHAREHOLDERS' AGREEMENTS. Two or more shareholders of this
corporation may enter into an agreement providing for the exercise of voting
rights in the manner provided in the agreement or relating to any phase of the
affairs of the corporation, in the manner and to the extent provided by law. The
agreement shall not impair the right of this corporation to treat a shareholder
of record as entitled to vote the shares as standing in his name.
ARTICLE III
Board of Directors
Section 1. GENERAL POWERS. All corporate powers shall be exercised by
or under the authority of, and the business and affairs of the corporation shall
be managed under the direction of, the Board of Directors except as may be
otherwise provided by law or in the Articles of Incorporation.
Section 2. NUMBER, TENURE AND QUALIFICATIONS. The corporation shall
have five (5) director(s) initially. The number of directors may be increased or
decreased from time to time by (a) a majority vote of the entire board of
directors, or (b) a vote of the holders of a majority of the outstanding shares
of the corporation at any regular or special meeting of the shareholders;
however, no decrease shall have the effect of shortening the term of an
incumbent director (unless the shareholders remove the director pursuant to
Section 15 hereof.
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At the 1998 Annual Meeting of Shareholders, the directors shall be
classified into two classes, as nearly equal in number as possible, with the
term of office for the first class to expire at the 1999 Annual Meeting of
Shareholders and the term of office of the second class to expire at the 2000
Annual Meeting of Shareholders. At each Annual Meeting of Shareholders following
such initial classification and election, directors elected to succeed those
directors whose terms expire shall be elected for a term of office to expire at
the second succeeding Annual Meeting of Shareholders after their election.
Section 3. ANNUAL MEETING. The Board of Directors shall hold its annual
meeting at the same place as, and immediately following, each annual meeting of
shareholders for the purpose of electing officers and the transaction of such
other business as may come before the meeting. If a majority of the directors is
present at such place and time, prior notice of the meeting need not be given to
the directors. Alternatively, the place and time of such meeting may be fixed by
written consent of the directors.
Section 4. REGULAR MEETINGS. Regular meetings of the Board of Directors
may be held without notice at such time and at such place as shall be determined
from time to time by the Board of Directors.
Section 5. SPECIAL MEETINGS. Special meetings of the Board of Directors
may be called by the Chairman of the Board, if any, the President or any two (2)
directors. The person or persons authorized to call special meetings of the
Board of Directors may fix the place for holding any special meetings that are
called by them.
Section 6. NOTICE. Notice of any special meeting shall be given at
least two (2) days prior thereto by written notice delivered personally, by
mail, telegraph, cablegraph or overnight courier, to the business address of the
director. Notice shall be effective at the earlier of: (a) personal receipt by
the director; (b) five (5) days after its deposit in the United States mail, as
evidenced by the postmark, if mailed postpaid; (c) the date shown on the return
receipt, if sent by registered or certified mail, return receipt requested, and
the receipt is signed by or on behalf of the addressee; (d) the date of delivery
of notice by telegraph or cablegraph, if confirmation of delivery is provided by
the telegraph or cablegraph company; or (e) the first business day following the
date on which the notice is sent by Federal Express or similar overnight courier
service.
Section 7. WAIVER OF NOTICE OF DIRECTORS' MEETINGS. Whenever any notice
of meeting is required to be given to any director under the provisions of law,
the Articles of Incorporation or these By-laws, a written waiver thereof signed
by the director either before or after the meeting shall be equivalent to the
giving of such notice. Neither the business to be transacted at, nor the purpose
of, any regular or special meeting of the directors need be specified in any
written waiver of notice. The attendance of a director at a meeting shall
constitute a waiver of notice of such meeting, except where a director states,
at the beginning of the meeting or promptly upon arrival at the meeting, any
objection to the transaction of business because the meeting is not lawfully
called or convened.
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Section 8. QUORUM. A majority of the required number of directors, as
specified in the Articles of Incorporation or specified in accordance with these
By-laws, shall constitute a quorum for the transaction of business unless a
greater number is required by the Articles of Incorporation for a quorum.
Section 9. MANNER OF ACTING. The act of a majority of the directors
present at a meeting at which a quorum is present shall be the act of the Board
of Directors, unless the act of a greater number is required by the Articles of
Incorporation.
Section 10. VACANCIES. Any vacancy occurring in the Board of Directors,
including any vacancy created by reason of an increase in the number of
directors, may be filled by the affirmative vote of a majority of the remaining
directors though less than a quorum of the Board of Directors, or by the
shareholders, unless the Articles of Incorporation provide otherwise and subject
to statutory restrictions regarding directors who were elected by a voting
group. A director elected to fill a vacancy shall hold office only until the
next election of directors by the shareholders.
Section 11. COMPENSATION. By resolution of the Board of Directors, any
director may be paid expenses, if any, of attendance at any meeting of the Board
of Directors, and may be paid a fixed sum for attendance at any meeting of the
Board of Directors, or a stated salary as a director. No payment shall preclude
a director from serving the corporation in any other capacity and receiving
compensation therefor.
Section 12. DUTIES OF DIRECTORS. A director shall perform his duties as
a director, including his duties as a member of any committee of the board upon
which he serves, in good faith, in a manner he reasonably believes to be in the
best interests of the corporation, and with such care as an ordinarily prudent
person in a similar position would use under similar circumstances.
In performing his duties, a director may rely on information, opinions,
reports, or statements, including financial statements and other financial data,
prepared or presented by the following:
(a) one or more officers or employees of the corporation whom the
director reasonably believes to be reliable and competent in the matters
presented;
(b) legal counsel, public accountants, or other persons as to matters
that the director reasonably believes to be within that person's professional or
expert competence; or
(c) a committee of the board of directors upon which he does not serve
and which he reasonably believes to merit confidence, as to matters within the
authority designated by it by the articles of incorporation or the by-laws.
In performing his duties, a director may consider such factors as the
director deems relevant, including the long-term prospects and interests of the
corporation and its shareholders, and the social, economic, legal or other
effects of any action on the employees, suppliers, customers of the corporation
or its subsidiaries, the communities and society in which the corporation or its
subsidiaries operate, and the economy of the state and the nation.
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A director shall not be considered as acting in good faith if he has
knowledge concerning the matter in question that would cause the reliance
described above to be unwarranted. A person who performs his duties in
compliance with this Section shall have no liability because of his being or
having been a director of the corporation.
Section 13. PRESUMPTION OF ASSENT. A director of the corporation who is
present at a meeting of the Board of Directors at which action on any corporate
matter is taken shall be presumed to have assented to the action taken unless:
(a) he objects at the beginning of the meeting (or promptly upon his arrival) to
the holding of the meeting or transacting specified business at the meeting; or
(b) he votes against such action or abstains from the action taken. To evidence
his abstention or vote against any action, a director shall file his written
dissent or abstention from such action with the person acting as the secretary
of the meeting before the adjournment thereof, or shall forward such dissent or
abstention by registered or certified mail, return receipt requested, to the
Secretary of the corporation immediately following the adjournment of the
meeting. Such right to dissent or abstain shall not apply to a director who
voted in favor of such action.
Section 14. ACTION BY THE BOARD WITHOUT A MEETING. Unless otherwise
provided in the Articles of Incorporation, any action required by law or these
By-laws to be taken at a meeting of the directors of the corporation, or any
action which may be taken at a meeting of the directors or a committee thereof,
may be taken without a meeting if a consent in writing, setting forth the action
taken, signed by all of the directors or all the members of the committee, as
the case may be, is filed in the minutes of the proceedings of the Board or of
the committee. Such consent shall have the same effect as a unanimous vote at a
meeting, and shall be effective when the last director signs the consent, unless
the consent specifies a different effective date.
Section 15. TELEPHONE MEETINGS. Except as otherwise provided in the
Articles of Incorporation, members of the Board of Directors may participate in
a regular or special meeting of the Board by means of a conference telephone or
similar communications equipment by means of which all persons participating in
the meeting can simultaneously hear each other during the meeting. Participation
by such means shall constitute presence in person at a meeting.
Section 16. REMOVAL AND RESIGNATION OF DIRECTORS. (a) Unless the
Articles of Incorporation otherwise provide, one or more directors may be
removed in the manner provided in this Section at a meeting of shareholders,
provided the notice of the meeting states that the purpose, or one of the
purposes, of the meeting is the removal of the director(s). Any director or the
entire Board of Directors may be removed, with or without cause, by a vote of
the holders of a majority of the shares then entitled to vote at an election of
directors, subject to statutory restrictions relating to directors who were
elected by voting groups or cumulative voting. The removal of a director shall
not prejudice the contract rights, if any, of the person removed. Election or
appointment of a director shall not of itself create contract rights.
(b) A director may resign at any time by delivering written notice to
the corporation's Board of Directors, its Chairman, if any, or to the
corporation. A resignation is effective when the notice is delivered, unless the
notice specifies a later effective date.
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Section 16. DIRECTOR CONFLICTS OF INTEREST. (a) No contract or other
transaction between this corporation and one or more of its directors or any
other corporation, firm, association or entity in which one or more of the
directors are directors or officers or are financially interested, shall be
either void or voidable because of that relationship or interest or because the
director or directors are present at the meeting of the board of directors or a
committee that authorizes, approves, or ratifies the contract or transaction or
because his or their votes are counted for that purpose, if:
(i) The existence of the relationship or interest is disclosed
or known to the board of directors or committee that authorizes, approves, or
ratifies the contract or transaction by a vote or consent sufficient for the
purpose, without counting the votes and consents of the interested directors; or
(ii) The existence of the relationship or interest is
disclosed or known to the shareholders entitled to vote and they authorize,
approve, or ratify the contract or transaction by vote or written consent; or
(iii) The contract or transaction is fair and reasonable to
the corporation at the time it is authorized by the board, a committee, or the
shareholders.
(b) For purposes of subsection (i) only, a conflict of interest
transaction is authorized, approved or ratified if it receives the affirmative
vote of a majority of the directors on the board of directors, or on the
committee, who have no relationship or interest in the transaction described in
Section 16(a) hereof, but a transaction may not be authorized, approved or
ratified under this Section by a single director. If a majority of the directors
who have no such relationship or interest in the transaction vote to authorize,
approve or ratify the transaction, a quorum is present for the purpose of taking
action under this Section. The presence of, or a vote cast by a director with
such relationship or interest in the transaction does not affect the validity of
any action taken under subsection (i) if the transaction is otherwise
authorized, approved or ratified as provided in that subsection, but such
presence or vote of those directors may be counted for purposes of determining
whether the transaction is approved under other sections of these by-laws or as
provided by law.
ARTICLE IV
Officers
Section 1. NUMBER. The corporation's officers shall include a
President, a Secretary and a Treasurer, each of whom shall be elected by the
Board of Directors. The Board of Directors may also elect a Chairman of the
Board, one or more Vice Presidents, one or more Assistant Secretaries and
Assistant Treasurers and such other officers, as the Board of Directors shall
deem appropriate. Two or more offices may be held simultaneously by the same
person.
Section 2. ELECTION AND TERM OF OFFICE. The officers of the corporation
shall be elected annually by the Board of Directors at its first meeting and
after each annual meeting of the shareholders. If the election of officers is
not held at such meeting, such election shall be held as soon thereafter as
convenient. Each officer shall hold office until his successor is duly elected
and qualified, or until his death, resignation or removal.
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Section 3. REMOVAL. Any officer or agent elected or appointed by the
Board of Directors may be removed by the Board whenever in its judgment the best
interests of the corporation will be served thereby. Any such removal shall be
without prejudice to the contract rights, if any, of the person so removed.
Election or appointment of an officer or agent shall not of itself create
contract rights.
Section 4. VACANCIES. Any vacancy, however occurring, in any office may
be filled by the Board of Directors.
Section 5. PRESIDENT. Unless otherwise provided by resolution of the
Board of Directors, the President shall be the chief executive officer of the
corporation, shall preside at all meetings of the shareholders and the board of
directors (if he shall be a member of the board), shall have general and active
management of the business and affairs of the corporation and shall see that all
orders and resolutions of the Board of Directors are carried into effect. The
President shall execute on behalf of the corporation, and may affix or cause the
seal to be affixed to, all instruments requiring such execution except to the
extent the signing and execution thereof shall be expressly delegated by the
Board of Directors to some other officer or agent of the corporation.
Section 6. VICE PRESIDENTS. The Vice Presidents, if any, shall act
under the direction of the President and in the absence or disability of the
President shall perform such other duties and have such other powers as the
President or the Board of Directors may from time to time prescribe. The Board
of Directors may designate one or more Executive Vice Presidents or may
otherwise specify the order and seniority of the Vice Presidents. The duties and
powers of the President shall descend to the Vice Presidents in such specified
order of seniority.
Section 7. SECRETARY. The Secretary shall act under the direction of
the President. Subject to the direction of the President, the Secretary shall
attend all meetings of the Board of Directors and all meetings of the
shareholders and record the proceedings. The Secretary shall perform like duties
for the standing committees when required; shall give, or cause to be given,
notice of all meetings of the shareholders and special meetings of the Board of
Directors; and shall perform such other duties as may be prescribed by the
President or the Board of Directors. The Secretary shall keep in safe custody
the seal of the corporation and, when authorized by the President or the Board
of Directors, cause it to be affixed to any instrument requiring it. The
Secretary shall be responsible for maintaining the stock transfer book and
minute book of the corporation and shall be responsible for their updating.
Section 8. ASSISTANT SECRETARIES. The Assistant Secretaries, if any,
shall act under the direction of the President in the order of their seniority
in office, unless otherwise determined by the President or the Board of
Directors. They shall, in the absence or disability of the Secretary, perform
the duties and exercise the powers of the Secretary. They shall perform such
other duties and have such other powers as the President or the Board of
Directors may from time to time prescribe.
Section 9. TREASURER. The Treasurer shall act under the direction of
the President. Subject to the direction of the President, the Treasurer shall
have the custody of the corporate funds
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and securities, shall keep full and accurate accounts of receipts and
disbursements in books belonging to the corporation, and shall deposit all
monies and other valuable effects in the name, and to the credit of, the
corporation in such depositories as may be designated by the Board of Directors.
The Treasurer shall disburse the funds of the corporation as may be ordered by
the President or the Board of Directors, taking proper vouchers for such
disbursements, and shall render to the President and the Board of Directors at
its regular meetings, or when the Board of Directors so requires, an account of
all his transactions as Treasurer and of the financial condition of the
corporation. The Treasurer may affix or cause to be affixed the seal of the
corporation to documents so requiring the seal.
Section 10. ASSISTANT TREASURERS. The Assistant Treasurers, if any, in
the order of their seniority of office, unless otherwise determined by the
President or the Board of Directors shall, in the absence or disability of the
Treasurer, perform the duties and exercise the powers of the Treasurer. They
shall perform such other duties and have such other powers as the President or
the Board of Directors may from time to time prescribe.
Section 11. DELEGATION OF DUTIES. Whenever an officer is absent or
whenever for any reason the Board of Directors may deem it desirable, the Board
of Directors may delegate the powers and duties of an officer to any other
officer or officers or to any director or directors.
Section 12. ADDITIONAL POWERS. To the extent the powers and duties of
the several officers are not provided from time to time by resolution or other
directive of the Board of Directors or by the President (with respect to other
officers), the officers shall have all powers and shall discharge the duties
customarily and usually held and performed by like officers of the corporations
similar in organization and business purposes to this corporation.
Section 13. SALARIES. The salaries of the officers shall be as fixed
from time to time by the Board of Directors.
ARTICLE V
Executive and Other Committees of the Board
Section 1. CREATION OF COMMITTEES. By resolution passed by a majority
of the full Board, the Board of Directors may designate an Executive Committee
and one or more other committees. Each committee of the Board shall consist of
two (2) or more members who shall serve at the pleasure of the Board of
Directors.
Section 2. EXECUTIVE COMMITTEE. The Executive Committee, if there is
one, shall consult with and advise the officers of the corporation in the
management of its business. The Executive Committee shall have, and may exercise
to the extent provided in the Board resolution creating such Executive
Committee, only such powers of the Board of Directors as can be lawfully
delegated by the Board.
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Section 3. OTHER COMMITTEES. Other committees shall have only such
functions as can be lawfully delegated and may exercise the powers of the Board
of Directors to the extent provided in the resolution or resolutions creating
such committee or committees.
Section 4. MEETINGS OF COMMITTEES. Regular meetings of the Executive
Committee and any other committees may be held without notice at such time and
place as shall from time to time be determined by each committee. Special
meetings of the Executive Committee or other committees may be called by any
member thereof upon two (2) days notice to each of the other members of the
committee, or upon such shorter notice as may be agreed to in writing by each of
the other members of the committee, given either personally or in the manner
provided in Section 6 of Article III of these By-laws (pertaining to notice for
directors' meetings). Members of the Executive Committee shall be deemed present
at a meeting of such Committee if a conference telephone or similar
communications equipment, by means of which all persons participating in the
meeting can hear each other, is used.
Section 5. VACANCIES ON COMMITTEES. Vacancies on the Executive
Committee or on other committees may be filled by the Board of Directors at any
regular or special meeting.
Section 6. QUORUM OF COMMITTEES. At all meetings of the Executive
Committee or any other committee, a majority of the committee's members then in
office shall constitute a quorum for the transaction of business.
Section 7. MANNER OF ACTING OF COMMITTEES. The act of a majority of the
members of the Executive Committee, or any other committee, who are present at a
meeting at which a quorum is present shall be the act of such committee.
Section 8. MINUTES OF COMMITTEES. The Executive Committee, if there is
one, and all other committees shall keep regular minutes of their proceedings
and shall report to the Board of Directors when required.
Section 9. COMPENSATION. Members of the Executive Committee or another
committee may be paid compensation in accordance with the provisions of Section
11 of Article III of these By-laws.
ARTICLE VI
Indemnification of Officers
Directors, Employees and Agents
Section 1. INDEMNIFICATION. Any person, or his heirs, or personal
representative who is made or threatened to be made a party to any threatened,
pending, or completed action or proceeding, whether civil, criminal,
administrative, or investigative, because he or his testator or intestate is or
was a director, officer, employee, or agent of this corporation or serves or
served any other corporation or enterprise in any capacity at the request of
this corporation, shall be indemnified by this corporation, and this corporation
may advance his related expenses, to the full extent permitted by law. The
foregoing right of indemnification or reimbursement shall not be exclusive of
other
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rights to which the person or his heirs, or personal representative may be
entitled. The corporation may, upon the affirmative vote of a majority of its
board of directors, purchase insurance for the purpose of indemnifying these
persons. The insurance may be for the benefit of all directors, officers, or
employees.
Section 2. INSURANCE. The corporation shall have power to purchase and
maintain insurance on behalf of any person who is or was a director, officer,
employee, or agent of the corporation or is or was serving at the request of the
corporation as a director, officer, employee, or agent of another corporation,
partnership, joint venture, trust, or other enterprise against any liability
asserted against him and incurred by him in any such capacity or arising out of
his status as such, whether or not the corporation would have the power to
indemnify him against such liability under the provisions of this Article.
ARTICLE VII
Issuance of Shares
Section 1. AUTHORIZATION. Unless the power to authorize the issuance of
shares is reserved to the shareholders in the Articles of Incorporation, the
Board of Directors may authorize issuances of one or more shares of the
corporation's authorized capital stock.
Section 2. CONSIDERATION FOR SHARES. (a) The Board of Directors may
authorize shares to be issued for a consideration consisting of any tangible or
intangible property or benefit to the corporation, including cash, promissory
notes, services performed, promises to perform services evidenced by a written
contract, or other securities of the corporation.
(b) Before the corporation issues shares, the Board of Directors must
determine in good faith that the consideration received or to be received for
shares to be issued is adequate. That determination by the Board of Directors is
conclusive insofar as the adequacy of consideration for the issuance of shares
relates to whether the shares are validly issued, fully paid, and nonassessable.
(c) When the corporation receives the consideration for which the Board
of Directors authorized the issuance of shares, the shares issued therefor are
fully paid and nonassessable. Consideration in the form of a promise to pay
money or a promise to perform services is deemed received by the corporation at
the time of the making of the promise, unless the agreement specifically
provides otherwise.
(d) The corporation may place in escrow shares issued for a contract
for future services or benefits or a promissory note, or make other arrangements
to restrict the transfer of the shares, and may credit distributions in respect
of the shares against their purchase price, until the services are performed,
the notice paid, or the benefits received. If the services are not performed,
the shares escrowed or restricted and the distributions credited may be canceled
in whole or in part.
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ARTICLE VIII
Certificates Representing Shares
Section 1. CERTIFICATES. Any certificate representing shares in the
corporation shall be signed by the President or a Vice President and the
Secretary or an Assistant Secretary of the corporation, shall state on its face
the name of the corporation and indicate that it is incorporated under the laws
of the State of Florida, shall state the name of the person to whom it is
issued, shall state the number and class of shares and the designation of the
series, if any, that the certificate represents, and may be sealed with the seal
of the corporation or a facsimile thereof. The certificates shall be numbered
and entered in the books of the corporation as they are issued. If an officer
who signed (or whose facsimile signature was placed on) a stock certificate no
longer holds office when the certificate is issued, the certificate is
nevertheless valid.
Section 2. RIGHTS OF DIFFERENT CLASSES. If the corporation is
authorized to issue different classes of shares or different series within a
class, the designations, relative rights, preferences and limitations applicable
to each class and the variations and rights, preferences and limitations
determined for each series (and the authority of the Board of Directors to
determine variations for future series) shall be summarized on the front or back
of each certificate. Alternatively, each certificate may state conspicuously on
its front or back that the corporation will furnish the shareholder a full
statement of the foregoing information on request and without charge.
Section 3. FACSIMILE SIGNATURES. The signatures of the President or
Vice President and the Secretary or Assistant Secretary may be facsimiles if the
certificate is manually signed on behalf of a transfer agent or a registrar
(other than the corporation itself or an employee of the corporation).
Section 4. TRANSFER OF SHARES. Transfers of shares of the corporation
shall be made upon the corporation's books by the holder of the shares, in
person or by his lawfully constituted representative, upon surrender of the
certificate representing shares for cancellation. The person in whose name
shares stand on the books of the corporation shall be deemed by the corporation
to be the owner thereof for all purposes. The corporation shall not be bound to
recognize any equitable or other claim to, or interest in, shares on the part of
any person other than the owner of record, regardless of whether the corporation
has express or other notice of such claim or interest, except as otherwise
provided by law.
ARTICLE IX
Shares Without Certificates
Section 1. AUTHORIZATION OF SHARES WITHOUT CERTIFICATES. Unless the
Articles of Incorporation provide otherwise, the Board of Directors of the
corporation may authorize the issue of some or all of the shares of any or all
of its classes or series without certificates. Such authorization does not
affect any shares already represented by certificates until they are duly
surrendered to the corporation. Unless expressly provided otherwise by law, the
rights and obligations of shareholders shall be identical whether or not their
shares are represented by certificates.
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Section 2. REQUIREMENTS. Within a reasonable time after the issue or
transfer of shares without certificates, the corporation shall send the holder
of such shares a written statement of the name of the corporation, a statement
that it is incorporated under the laws of the State of Florida, the name of the
person to whom the shares are issued, the number and class of shares and the
designation of the series, if any, represented by the shares. If the corporation
is authorized to issue different classes of shares or different series within a
class, the written statement shall summarize the designations, relative rights,
preferences and limitations applicable to each class and the variations and
rights, preferences, and limitations determined for each series (and the
authority of the Board of Directors to determine variations for future series).
Alternatively, the written statement shall specify that the corporation will
furnish the shareholder, on request and without charge, a full statement of the
information specified in the preceding sentence.
ARTICLE X
Transfer Books
Section 1. CLOSING OF TRANSFER BOOKS. To determine which shareholders
shall be entitled to notice of or to vote at a meeting of shareholders, or shall
be entitled to receive a dividend, the Board of Directors of the corporation may
provide that the stock transfer books shall be closed for a stated period not to
exceed, in any case, seventy (70) days. If the stock transfer books are closed
for the purpose of determining shareholders entitled to notice of or to vote at
a meeting of shareholders, such books shall be closed for at least ten (10) days
immediately preceding such meeting.
Section 2. FIXING RECORD DATE. In lieu of closing the stock transfer
books, the Board of Directors may fix a date as the record date for any such
determination of shareholders. The record date may not be more than seventy (70)
days and, in the case of a meeting of shareholders, not less than ten (10) days
prior to the date on which the particular action requiring the determination of
shareholders is to be taken.
Section 3. NO RECORD DATE FIXED. If the stock transfer books are not
closed and no record date is fixed, then the date on which notice of the meeting
is mailed, or the date on which the resolution of the Board of Directors
declaring such dividend is adopted, as the case may be, shall be the record date
for the determination of shareholders.
Section 4. ADJOURNMENTS. When a determination of shareholders entitled
to vote at any meeting of shareholders has been made as provided in this
Article, such determination shall apply to any adjournment thereof, unless: (a)
the meeting is adjourned to a date more than 120 days after the date fixed for
the original meeting; or (b) the Board of Directors fixes a new record date
pursuant to this Article for the adjourned meeting.
B-21
<PAGE>
ARTICLE XI
Dividends
The Board of Directors may from time to time declare, and the
corporation may pay, dividends on its outstanding shares of capital stock in the
manner, and upon the terms and conditions, provided by law, the Articles of
Incorporation, and these By-laws. Dividends may be paid in cash, in property, or
in the corporation's own shares, subject to the provisions of law and the
Articles of Incorporation.
ARTICLE XII
Fiscal Year
The fiscal year of the corporation shall be the twelve-month period
ending December 31, or such other twelve month period as may be selected by the
Board of Directors as the taxable year of the corporation for federal income tax
purposes.
ARTICLE XIII
Corporate Records
Section 1. RETENTION OF CORPORATE RECORDS. The corporation shall keep
the following corporate records permanently:
(a) its Articles of Incorporation or restated Articles of Incorporation
and all amendments to same;
(b) its By-laws or restated By-laws and all amendments to same; and
(c) minutes of all meetings of its shareholders and Board of Directors,
a record of all actions taken by the shareholders or Board of Directors without
a meeting, and a record of all actions taken by each committee (if any) of the
Board of Directors in place of the Board of Directors.
Section 2. LIST OF SHAREHOLDERS. The corporation (or its agent) shall
maintain a permanent record of its shareholders in a form that permits the
preparation of a list of the names and addresses of all shareholders in
alphabetical order by class of shares, showing the number and series of shares
held by each.
Section 3. OTHER RECORDS. In addition to the foregoing, the corporation
shall maintain copies of the following corporate records:
(a) all written communications to all shareholders generally or all
shareholders of a class or series within the past three (3) years, including the
financial statements furnished for the past three (3) years pursuant to law or
Article XIV of these By-laws;
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<PAGE>
(b) a list of the names and business street addresses of the
corporation's current directors and officers; and
(c) its most recent annual report delivered to the Florida Department
of State.
ARTICLE XIV
Financial Statements to Shareholders
Section 1. DELIVERY TO SHAREHOLDERS. Unless modified by resolution of
the shareholders within 120 days of the close of each fiscal year, the
corporation shall furnish its shareholders with annual financial statements,
which may be consolidated or combined statements of the corporation and one or
more of its subsidiaries, as appropriate. Such financial statements shall
include a balance sheet as of the end of the fiscal year, an income statement
for that year, and a statement of cash flows for that year. If financial
statements are prepared for the corporation on the basis of generally accepted
accounting principles, the annual financial statements must also be prepared on
that basis.
Section 2. REPORT ON FINANCIAL STATEMENTS. If the annual financial
statements are reported upon by a public accountant, the accountant's report
must accompany them. If not, the statements must be accompanied by a statement
of the corporation's President or the person responsible for the corporation's
accounting records:
(a) stating his or her reasonable belief as to whether the statements
were prepared on the basis of generally accepted accounting principles and, if
not, describing the basis of preparation; and
(b) describing any respects in which the statements were not prepared
on a basis of accounting consistent with the statements prepared for the
preceding year.
Section 3. PROCEDURE FOR DELIVERY. The corporation shall mail the
annual financial statements to each shareholder within 120 days after the close
of each fiscal year, or within such additional time thereafter as is reasonably
necessary to enable the corporation to prepare its financial statements if, for
reasons beyond the corporation's control, it is unable to prepare its financial
statements within the prescribed period.
Section 4. DELIVERY UPON REQUEST. Upon the written request of a
shareholder to whom the statements were not mailed, the corporation shall mail
the latest annual financial statements to such shareholder. The corporation
shall comply with requests made pursuant to this Section within thirty (30) days
of the delivery of such a request to the corporation.
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<PAGE>
ARTICLE XV
Seal
The corporate seal shall bear the name of the corporation and the words
"Corporate Seal, Florida".
ARTICLE XVI
Shares in Other Corporations
Shares in other corporations which are held by this corporation shall
be voted by such officer or officers of this corporation as the Board of
Directors shall from time to time designate for such purpose or by a proxy
thereunto duly authorized by the Board.
ARTICLE XVII
Board of Directors
Section 1. NOTIFICATIONS OF NOMINATIONS AND PROPOSED BUSINESS. Subject
to the rights of holder of any class or series of stock having a preference over
the Common Stock as to dividends or upon liquidation, (a) nominations for
election of directors, and (b) business proposed to be brought before any
shareholder meeting, may be made by the Board of Directors or proxy committee
appointed by the Board of Directors or by any shareholder entitled to vote in
the election of directors generally. However, any such shareholder may nominate
one or more persons for election as directors at a meeting or propose business
to be brought before a meeting, or both, only if such shareholder has given
timely notice in proper written form of his intent to make such nomination or
nominations or to propose such business. To be timely, a shareholder's notice
must be delivered to or mailed and received by the Secretary of the corporation
not later than sixty (60) days prior to such meeting. To be in proper written
form, a shareholder's notice to the Secretary shall set forth:
(i) the name and address of the shareholder who intends to make the
nominations or propose the business and, as the case may be, of the person or
persons to be nominated or of the business to be proposed;
(ii) a representation that the shareholder is a holder of record of
stock of the corporation entitled to vote at such meeting and, if applicable,
intends to appear in person or by proxy at the meeting to nominate the person or
persons specified in the notice;
(iii) if applicable, a description of all arrangements or
understandings between the shareholder and each nominee and any other person or
persons (naming such person or persons) pursuant to which the nomination or
nominations are to be made by the shareholder;
B-24
<PAGE>
(iv) such other information regarding each nominee or each matter of
business to be proposed by such shareholder as would be required to be included
in a proxy statement filed pursuant to the proxy rules of the Securities and
Exchange Commission had the nominee been nominated, or intended to be nominated,
or the matter been proposed, or intended to be proposed by the Board of
Directors, and
(v) if applicable, the consent of each nominee to serve as director of
the corporation, if so elected. The chairman of the meeting may refuse to
acknowledge the nomination of any person or the proposal of any business not
made in compliance with the foregoing procedure.
ARTICLE XVIII
Amendments
The By-Laws of the corporation may be altered, amended, or repealed,
and new By-Laws may be adopted, by action of the board of directors, subject to
the limitations of F.S. 607.1020(1) or any successor statute thereto. The
shareholders of the Corporation may alter, amend, or repeal these By-Laws or
adopt new By-Laws even though these By-Laws may also be amended or repealed by
the Board of Directors.
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<PAGE>
EXHIBIT "C"
MIZAR ENERGY COMPANY
DBA HBOA HOLDINGS, INC.
2000 EQUITY COMPENSATION PLAN
<PAGE>
Table of Contents
-----------------
<TABLE>
<CAPTION>
Page
<S> <C>
1. Administration...........................................................................................1
2. Grants...................................................................................................2
3. Shares Subject to the Plan...............................................................................2
4. Eligibility for Participation............................................................................3
5. Granting of Options......................................................................................3
6. Restricted Stock Grants..................................................................................6
7. Withholding of Taxes.....................................................................................8
8. Transferability of Grants................................................................................8
9. Reorganization of the Company............................................................................9
10. Requirements for Issuance or Transfer of Shares..........................................................9
11. Amendment and Termination of the Plan...................................................................10
12. Funding of the Plan.....................................................................................10
13. Rights of Participants..................................................................................10
14. No Fractional Shares. .................................................................................10
15. Headings. .............................................................................................10
16. Effective Date of the Plan..............................................................................11
17. Miscellaneous...........................................................................................11
</TABLE>
i
<PAGE>
MIZAR ENERGY COMPANY
DBA HBOA HOLDINGS INCORPORATED
2000 EQUITY COMPENSATION PLAN
The purpose of the Mizar Energy Company dba HBOA Holdings, Inc. 2000
Equity Compensation Plan (the "Plan") is to provide (i) designated employees of
HBOA Holdings Incorporated (the "Company") and its subsidiaries, (ii) certain
Key Advisors (as defined in Section 4(a)) who perform services for the Company
or its subsidiaries and (iii) non-employee members of the Board of Directors of
the Company (the "Board") with the opportunity to receive grants of incentive
stock options, nonqualified stock options and restricted stock. The Company
believes that the Plan will encourage the participants to contribute materially
to the growth of the Company, thereby benefiting the Company's shareholders, and
will align the economic interests of the participants with those of the
shareholders.
1. Administration.
--------------
(a) Committee. The Plan shall be administered and interpreted
by the Board of Directors or a committee appointed by the Board (the Board of
Directors in such capacity or any committee appointed by the Board of Directors
is referred to hereafter as the "Committee"). The Committee as appointed by the
Board shall consist of two or more persons appointed by the Board, all of whom
may or may not be "outside directors" as defined under section 162(m) of the
Internal Revenue Code of 1986, as amended (the "Code") and related Treasury
regulations and may be "non-employee directors" as defined under Rule 16b-3
under the Securities Exchange Act of 1934, as amended (the "Exchange Act").
(b) Committee Authority. The Committee shall have the sole
authority to (i) determine the individuals to whom grants shall be made under
the Plan, (ii) determine the type, size and terms of the grants to be made to
each such individual, (iii) determine the time when the grants will be made and
the duration of any applicable exercise or restriction period, including the
criteria for exercisability and the acceleration of exercisability and (iv) deal
with any other matters arising under the Plan.
(c) Committee Determinations. The Committee shall have full
power and authority to administer and interpret the Plan, to make factual
determinations and to adopt or amend such rules, regulations, agreements and
instruments for implementing the Plan and for the conduct of its business as it
deems necessary or advisable, in its sole discretion. The Committee's
interpretations of the Plan and all determinations made by the Committee
pursuant to the powers vested in it hereunder shall be conclusive and binding on
all persons having any interest in the Plan or in any awards granted hereunder.
All powers of the Committee shall be executed in its sole discretion, in the
best interest of the Company, not as a fiduciary, and in keeping with the
objectives of the Plan and need not be uniform as to similarly situated
individuals.
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<PAGE>
2. Grants. Awards under the Plan may consist of grants of incentive
stock options as described in Section 5 ("Incentive Stock Options"),
nonqualified stock options as described in Section 5 ("Nonqualified Stock
Options" and, together with Incentive Stock Options, "Options"), and restricted
stock as described in Section 6 ("Restricted Stock") (hereinafter collectively
referred to as "Grants"). All Grants shall be subject to the terms and
conditions set forth herein and to such other terms and conditions consistent
with this Plan as the Committee deems appropriate and as are specified in
writing by the Committee to the individual in a grant instrument (the "Grant
Instrument") or an amendment to the Grant Instrument. In the event there is an
inconsistency between the terms of the Grant Instrument and the terms of the
Plan, the terms of the Plan shall govern. The Committee shall approve the form
and provisions of each Grant Instrument. Grants under a particular Section of
the Plan need not be uniform as among the grantees.
3. Shares Subject to the Plan
(a) Shares Authorized. Subject to the adjustment specified
below, the aggregate number of shares of common stock of the Company ("Company
Stock") that may be issued or transferred under the Plan is 2,700,000 shares.
The maximum aggregate number of shares of Company Stock that shall be subject to
Grants made under the Plan to any individual during any calendar year shall be
as determined by the Committee ("Award Limit"). The shares may be authorized but
unissued shares of Company Stock or reacquired shares of Company Stock,
including shares purchased by the Company on the open market for purposes of the
Plan. If and to the extent Options granted under the Plan terminate, expire, or
are canceled, forfeited, exchanged or surrendered without having been exercised,
or if any shares of Restricted Stock are forfeited, the shares subject to such
Grants shall again be available for purposes of the Plan. However, to the extent
Section 162(m) of the Code requires, such shares continue to be counted against
the Award Limit.
(b) Adjustments. If there is any change in the number or kind
of shares of Company Stock outstanding (i) by reason of a stock dividend,
spinoff, recapitalization, stock split or combination or exchange of shares,
(ii) by reason of a merger, reorganization or consolidation in which the Company
is the surviving corporation, (iii) by reason of a reclassification or change in
par value, or (iv) by reason of any other extraordinary or unusual event
affecting the outstanding Company Stock as a class without the Company's receipt
of consideration, or if the value of outstanding shares of Company Stock is
substantially reduced as a result of a spinoff or the Company's payment of an
extraordinary dividend or distribution, the maximum number of shares of Company
Stock available for Grants, the maximum number of shares of Company Stock that
any individual participating in the Plan may be granted in any year, the number
of shares covered by outstanding Grants, the kind of shares issued under the
Plan, and the price per share or the applicable market value of such Grants
shall be appropriately adjusted by the Committee to reflect any increase or
decrease in the number of, or change in the kind or value of, issued shares of
Company Stock to preclude, to the extent practicable, the enlargement or
dilution of rights and benefits under such Grants; provided, however, that any
fractional shares resulting from such adjustment shall be eliminated. Any
adjustments determined by the Committee shall be final, binding and conclusive.
C-2
<PAGE>
With respect to Options which are granted to participants, the
compensation of whom could be subject to limitation under Section 162(m) of the
Code and which are intended to qualify as performance-based compensation under
Section 162(m)(4)(C), no adjustment or action described in this Section 3(b) or
in any other provision of the Plan shall be authorized to the extent that such
adjustment or action would cause the option to fail to qualify under Section
162(m)(4)(C), or any successor provisions thereto. Furthermore, no adjustment or
action shall be authorized to the extent the adjustment or action would result
in short-swing profits liability under Section 16 or violate the exemptive
conditions of Rule 16b-3 unless the Committee determines that the Option or
other award is not to comply with such exemptive conditions. The number of
shares of Company Stock subject to any Option shall always be rounded to the
next whole number.
4. Eligibility for Participation.
-----------------------------
(a) Eligible Persons. All employees of the Company and its
subsidiaries ("Employees"), including Employees who are officers or members of
the Board, and members of the Board who are not Employees ("Non-Employee
Directors") shall be eligible to participate in the Plan. Key advisors and
consultants who perform services to the Company or any of its subsidiaries ("Key
Advisors") shall be eligible to participate in the Plan if the Key Advisors
render bona fide services and such services are not in connection with the offer
or sale of securities in a capital-raising transaction.
(b) Selection of Grantees. The Committee shall select the
Employees, Non-Employee Directors and Key Advisors to receive Grants and shall
determine the number of shares of Company Stock subject to a particular Grant in
such manner as the Committee determines. Employees, Key Advisors and
Non-Employee Directors who receive Grants under this Plan shall hereinafter be
referred to as "Grantees."
5. Granting of Options.
-------------------
(a) Number of Shares. The Committee shall determine the number
of shares of Company Stock that will be subject to each Grant of Options to
Employees, Non-Employee Directors and Key Advisors.
(b) Type of Option and Price.
------------------------
(i) The Committee may grant Incentive Stock Options
that are intended to qualify as "incentive stock options" within the meaning of
section 422 of the Code or Nonqualified Stock Options that are not intended to
so qualify or any combination of Incentive Stock Options and Nonqualified Stock
Options, all in accordance with the terms and conditions set forth herein.
Incentive Stock Options may be granted only to Employees. Nonqualified Stock
Options may be granted to Employees, Non-Employee Directors and Key Advisors.
(ii) The purchase price (the "Exercise Price") of
Company Stock subject to an Option shall be determined by the Committee and may
be equal to, greater than, or less than the Fair Market Value (as defined below)
of a share of Company Stock on the date the Option is granted,
C-3
<PAGE>
provided, however, that (A) the Exercise Price of an Incentive Stock Option
shall be equal to, or greater than, the Fair Market Value of a share of Company
Stock on the date the Incentive Stock Option is granted; (B) an Incentive Stock
Option may not be granted to an Employee who, at the time of grant, owns stock
possessing more than 10 percent of the total combined voting power of all
classes of stock of the Company or any parent or subsidiary of the Company,
unless the Exercise Price per share is not less than 110% of the Fair Market
Value of Company Stock on the date of grant; (C) in the case of an option
intended to qualify as performance based compensation (as described n Section
162(m)(4)(c) of the Code), the Exercise Price shall not be less than 100% of the
Fair Market Value of Company Stock on the date of grant; and (D) in the case of
Nonqualified Stock Options granted to non-employee directors, the Exercise Price
shall equal 100% of the Fair Market Value of Company Stock on the date of grant.
(iii) If the Company Stock is publicly traded, then
the Fair Market Value per share shall be determined as follows: (x) if the
principal trading market for the Company Stock is a national securities exchange
or the Nasdaq National Market, the last reported sale price thereof on the
relevant date or (if there were no trades on that date) the latest preceding
date upon which a sale was reported, or (y) if the Company Stock is not
principally traded on such exchange or market, the mean between the last
reported "bid" and "asked" prices of Company Stock on the relevant date, as
reported on Nasdaq or, if not so reported, as reported by the National Daily
Quotation Bureau, Inc. or as reported in a customary financial reporting
service, as applicable and as the Committee determines. If the Company Stock is
not publicly traded or, if publicly traded, is not subject to reported
transactions or "bid" or "asked" quotations as set forth above, the Fair Market
Value per share shall be as determined by the Committee.
(c) Option Term. The Committee shall determine the term of
each Option. The term of any Option shall not exceed ten years from the date of
grant. However, an Incentive Stock Option that is granted to an Employee who, at
the time of grant, owns stock possessing more than 10 percent of the total
combined voting power of all classes of stock of the Company, or any parent or
subsidiary of the Company, may not have a term that exceeds five years from the
date of grant.
(d) Vesting and Exercisability of Options. Options shall vest
and become exercisable in accordance with such terms and conditions, consistent
with the Plan, as may be determined by the Committee and specified in the Grant
Instrument or an amendment to the Grant Instrument. The Committee may accelerate
the vesting and/or exercisability of any or all outstanding Options at any time
for any reason. Options may, at the discretion of the Committee, be exercised
prior to vesting, provided that the optionee grants the Company a right to
repurchase any unvested shares at the exercise price upon termination of the
optionee's service to the Company.
C-4
<PAGE>
(e) Termination of Employment, Disability or Death.
(i) Except as provided below, an Option may only be
exercised while the Grantee is employed by or otherwise providing service to the
Company as an Employee, Key Advisor or member of the Board. In the event that a
Grantee ceases to be employed by the Company for any reason other than a
"disability", or "termination for cause", any Option which is otherwise
exercisable by the Grantee shall terminate unless exercised within one hundred
eighty days after the date on which the Grantee ceases to be employed by the
Company (or within such other period of time as may be specified in a Grant
Instrument), but in any event no later than the date of expiration of the Option
term. Any of the Grantee's Options that are not otherwise exercisable as of the
date on which the Grantee ceases to be employed by the Company shall terminate
as of such date (unless specified to the contrary in a Grant Instrument).
(ii) In the event the Grantee ceases to be employed
by the Company on account of a "termination for cause" by the Company, the
unvested portion of any Option held by the Grantee shall terminate on the date
on which the Grantee ceases to be employed by the Company. Any of the Grantee's
Options which are not otherwise exercisable as of the date on which the Grantee
ceases to be employed by the Company shall terminate as of such date.
(iii) In the event the Grantee ceases to be employed
by the Company because the Grantee is "disabled", any Option which is otherwise
exercisable by the Grantee shall terminate unless exercised within one year
after the date on which the Grantee ceases to be employed by the Company (or
within such other period of time as may be specified in a Grant Instrument), but
in any event no later than the date of expiration of the Option term. Any of the
Grantee's Options which are not otherwise exercisable as of the date on which
the Grantee ceases to be employed by the Company shall terminate as of such date
(unless specified to the contrary in a Grant Instrument).
(iv) If the Grantee dies while employed by the
Company or within 90 days after the date on which the Grantee ceases to be
employed on account of a termination of employment specified in Section 5(e)(i)
above (or within such other period of time as may be specified in a Grant
Instrument), any Option that is otherwise exercisable by the Grantee shall
terminate unless exercised within one year after the date on which the Grantee
ceases to be employed by the Company (or within such other period of time as may
be specified in a Grant Instrument), but in any event no later than the date of
expiration of the Option term. Any of the Grantee's Options that are not
otherwise exercisable as of the date on which the Grantee ceases to be employed
by the Company shall terminate as of such date (unless specified to the contrary
in a Grant Instrument).
(v) For purposes of Sections 5(e) and 6:
(A) "Company," when used in the phrase
"employed by the Company," shall mean the Company and its parent and
subsidiary corporations.
(B) "Employed by the Company" shall mean
employment or service as an Employee, Key Advisor or member of the
Board (so that, for purposes of exercising Options and satisfying
conditions with respect to Restricted Stock, a Grantee shall not be
considered to have terminated employment or service until the Grantee
ceases to be an Employee, Key Advisor and member of the Board), unless
the Committee determines otherwise.
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<PAGE>
(C) "Disability" shall mean a Grantee's
becoming disabled within the meaning of section 22(e)(3) of the Code or
otherwise as defined in an employment consultant or other agreement
between the Company and the Grantee.
(D) "Termination for cause" shall mean,
except to the extent specified otherwise by the Committee or otherwise
as defined in an employment, consultant or other agreement between the
Company and the Grantee, a finding by the Committee that the Grantee
has breached his or her employment, service, noncompetition,
nonsolicitation or other similar contract with the Company, or has been
engaged in disloyalty to the Company, including, without limitation,
fraud, embezzlement, theft, commission of a felony or dishonesty in the
course of his or her employment or service, or has disclosed trade
secrets or confidential information of the Company to persons not
entitled to receive such information. A Grant Instrument may provide
that in the event a Grantee's employment is terminated for cause, in
addition to the immediate termination of all Grants, the Grantee shall
automatically forfeit all shares underlying any exercised portion of an
Option, upon refund by the Company of the Exercise Price paid by the
Grantee for such shares, and any option gain realized by the Grantee
from exercising all or a portion of an Option within the two-year
period prior to the event shall be paid by the Grantee to the Company.
(f) Exercise of Options. A Grantee may exercise an Option that
has become exercisable, in whole or in part, by delivering a notice of exercise
to the Company with payment of the Exercise Price. The Grantee shall pay the
Exercise Price for an Option as specified by the Committee (x) in cash, (y) with
the approval of the Committee, by delivering shares of Company Stock owned by
the Grantee for the period necessary to avoid a charge to the Company's earnings
for financial reporting purposes (including Company Stock acquired in connection
with the exercise of an Option, subject to such restrictions as the Committee
deems appropriate) and having a Fair Market Value on the date of exercise equal
to the Exercise Price or (z) by such other method as the Committee may approve,
including payment through a broker in accordance with procedures permitted by
Regulation T of the Federal Reserve Board. Shares of Company Stock used to
exercise an Option shall have been held by the Grantee for the requisite period
of time to avoid adverse accounting consequences to the Company with respect to
the Option. The Grantee shall pay the Exercise Price and the amount of any
withholding tax due (pursuant to Section 7) at the time of exercise.
(g) Limits on Incentive Stock Options. Each Incentive Stock
Option shall provide that, if the aggregate Fair Market Value of the stock on
the date of the grant with respect to which Incentive Stock Options are
exercisable for the first time by a Grantee during any calendar year, under the
Plan or any other stock option plan of the Company or a parent or subsidiary,
exceeds $100,000, then the option, as to the excess, shall be treated as a
Nonqualified Stock Option. An Incentive Stock Option shall not be granted to any
person who is not an Employee of the Company or a parent or subsidiary (within
the meaning of section 424(f) of the Code).
C-6
<PAGE>
6. Restricted Stock Grants. The Committee may issue or transfer shares
of Company Stock to an Employee or Key Advisor under a Grant of Restricted
Stock, upon such terms as the Committee deems appropriate. The following
provisions are applicable to Restricted Stock:
(a) General Requirements. Shares of Company Stock issued or
transferred pursuant to Restricted Stock Grants may be issued or transferred for
consideration or for no consideration, as determined by the Committee. The
Committee may establish conditions under which restrictions on shares of
Restricted Stock shall lapse over a period of time or according to such other
criteria as the Committee deems appropriate. The period of time during which the
Restricted Stock will remain subject to restrictions will be designated in the
Grant Instrument as the "Restriction Period."
(b) Number of Shares. The Committee shall determine the number
of shares of Company Stock to be issued or transferred pursuant to a Restricted
Stock Grant and the restrictions applicable to such shares.
(c) Requirement of Employment. If the Grantee ceases to be
employed by the Company (as defined in Section 5(e)) during a period designated
in the Grant Instrument as the Restriction Period, or if other specified
conditions are not met, the Restricted Stock Grant shall terminate as to all
shares covered by the Grant as to which the restrictions have not lapsed, and
those shares of Company Stock must be immediately returned to the Company. The
Committee may, however, provide for complete or partial exceptions to this
requirement as it deems appropriate.
(d) Restrictions on Transfer and Legend on Stock Certificate.
During the Restriction Period, a Grantee may not sell, assign, transfer, pledge
or otherwise dispose of the shares of Restricted Stock except to a Successor
Grantee under Section 8(a). Each certificate for a share of Restricted Stock
shall contain a legend giving appropriate notice of the restrictions in the
Grant. The Grantee shall be entitled to have the legend removed from the stock
certificate covering the shares subject to restrictions when all restrictions on
such shares have lapsed. The Committee may determine that the Company will not
issue certificates for shares of Restricted Stock until all restrictions on such
shares have lapsed, or that the Company will retain possession of certificates
for shares of Restricted Stock until all restrictions on such shares have
lapsed.
(e) Right to Vote and to Receive Dividends. Unless the
Committee determines otherwise, during the Restriction Period, the Grantee shall
have the right to vote shares of Restricted Stock and to receive any dividends
or other distributions paid on such shares, subject to any restrictions deemed
appropriate by the Committee.
(f) Lapse of Restrictions. All restrictions imposed on
Restricted Stock shall lapse upon the expiration of the applicable Restriction
Period and the satisfaction of all conditions imposed by the Committee. The
Committee may determine, as to any or all Restricted Stock Grants, that the
restrictions shall lapse without regard to any Restriction Period.
(g) Performance Based Compensation. The Committee may grant
Restricted Stock to an employee covered under Section 162(m) of the Code that
vests upon the attainment of
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performance targets for the Company which are related to one or more of the
following performance goals: (i) pre-tax income, (ii) operating income, (iii)
cash flow, (iv) earnings per share, (v) return on equity, (vi) return on
invested capital or assets and (vii) cost reductions or savings. To the extent
necessary to comply with the performance-based compensation requirements of
Section 162(m)(4)(c) of the Code, with respect to Restricted Stock which may be
granted to one or more employees covered under Section 162(m) of the Code, no
later than ninety days following the commencement of any fiscal year in question
or any other designated fiscal period, the Committee shall, in writing, (i)
designate the employees covered under Section 162(m) of the Code, (ii) select
the performance goal or goals applicable to the fiscal year or other designated
fiscal period, (iii) establish the various targets and bonus amounts which may
be earned for such fiscal year or other designated fiscal period and (iv)
specify the relationship between performance goals and targets and the amounts
to be earned by each Section 162(m) participant for such fiscal year or other
designed fiscal period. Following the completion of each fiscal year or other
designated fiscal period, the Committee shall certify in writing whether the
applicable performance target has been achieved for such fiscal year or other
designated fiscal period. In determining the amount earned by a Section 162(m)
participant, the Committee shall have the right to reduce (but not to increase)
the amount payable at a given level of performance to take into account
additional factors that the Committee may deem relevant to the assessment of
individual or corporate performance for the fiscal year or other designed fiscal
period.
7. Withholding of Taxes
(a) Required Withholding. All Grants under the Plan shall be
subject to applicable federal (including FICA), state and local tax withholding
requirements. The Company shall have the right to deduct from all Grants paid in
cash, or from other wages paid to the Grantee, any federal, state or local taxes
required by law to be withheld with respect to such Grants. In the case of
Options and other Grants paid in Company Stock, the Company may require the
Grantee or other person receiving such shares to pay to the Company the amount
of any such taxes that the Company is required to withhold with respect to such
Grants, or the Company may deduct from other wages paid by the Company the
amount of any withholding taxes due with respect to such Grants.
(b) Election to Withhold Shares. If the Committee so permits,
a Grantee may elect to satisfy the Company's income tax withholding obligation
with respect to an Option or Restricted Stock paid in Company Stock by having
shares withheld up to an amount that does not exceed the Grantee's maximum
marginal tax rate for federal (including FICA), state and local tax liabilities.
The election must be in a form and manner prescribed by the Committee and shall
be subject to the prior approval of the Committee.
8. Transferability of Grants
(a) Nontransferability of Grants. Except as provided below,
only the Grantee may exercise rights under a Grant during the Grantee's
lifetime. A Grantee may not transfer those rights except by will or by the laws
of descent and distribution or, with respect to Grants other than Incentive
Stock Options, and then only if and to the extent permitted in any specific case
by the Committee, pursuant to a domestic relations order (as defined under the
Code or Title I of the
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Employee Retirement Income Security Act of 1974, as amended, or the regulations
thereunder). When a Grantee dies, the personal representative or other person
entitled to succeed to the rights of the Grantee ("Successor Grantee") may
exercise such rights. A Successor Grantee must furnish proof satisfactory to the
Company of his or her right to receive the Grant under the Grantee's will or
under the applicable laws of descent and distribution.
(b) Transfer of Nonqualified Stock Options. Notwithstanding
the foregoing, the Committee may provide, in a Grant Instrument, that a Grantee
may transfer Nonqualified Stock Options to family members or other persons or
entities according to such terms as the Committee may determine; provided that
the Grantee receives no consideration for the transfer of an Option and the
transferred Option shall continue to be subject to the same terms and conditions
as were applicable to the Option immediately before the transfer.
8. Transferability of Grants
(a) Nontransferability of Grants. Except as provided below,
only the Grantee may exercise rights under a Grant during the Grantee's
lifetime. A Grantee may not transfer those rights except by will or by the laws
of descent and distribution or, with respect to Grants other than Incentive
Stock Options, and then only if and to the extent permitted in any specific case
by the Committee, pursuant to a domestic relations order (as defined under the
Code or Title I of the Employee Retirement Income Security Act of 1974, as
amended, or the regulations there under). When a Grantee dies, the personal
representative or other person entitled to succeed to the rights of the Grantee
("Successor Grantee") may exercise such rights. A Successor Grantee must furnish
proof satisfactory to the Company of his or her right to receive the Grant under
the Grantee's will or under the applicable laws of descent and distribution.
(b) Transfer of Nonqualified Stock Options. Notwithstanding
the foregoing, the Committee may provide, in a Grant Instrument, that a Grantee
may transfer Nonqualified Stock Options to family members or other persons or
entities according to such terms as the Committee may determine; provided that
the Grantee receives no consideration for the transfer of an Option and the
transferred Option shall continue to be subject to the same terms and conditions
as were applicable to the Option immediately before the transfer.
9. Reorganization of the Company.
-----------------------------
(a) Reorganization. As used herein, a "Change of Control"
shall be deemed to have occurred upon the consummation of any of the following
transactions: (i) any merger or consolidation of the Company or other
transaction (other than sales of equity by the Company for the purpose of
raising cash for its own account) where the shareholders of the Company
immediately prior to such transaction will not beneficially own immediately
after such transaction shares entitling such shareholders to more than 50% of
all votes to which all shareholders of the surviving corporation would be
entitled in the election of directors (without consideration of the rights of
any class of stock to elect directors by a separate class vote); or (ii) the
sale or other disposition of all or substantially all of the assets of the
Company.
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(b) Assumption of Grants. Upon a Change of Control where the
Company is not the surviving corporation (or survives only as a subsidiary of
another corporation), the Company shall provide that either (i) all outstanding
Options that are not exercised shall be assumed by, or replaced with comparable
options or rights by, the surviving corporation, (ii) the Company or the
surviving company shall pay to each Grantee an amount equal to the product of
(x) the number of Options then vested and exercisable, multiplied by (ii) the
Fair Market Value per share less the Exercise Price per Option, or (iii) the
Committee may, in its sole discretion, accelerate the vesting of some or all of
the Grants.
(c) Notice and Acceleration. Upon a Change of Control, the
Company shall provide each Grantee who has outstanding Grants with written
notice of such Change of Control. The Committee may, in its sole discretion,
provide in a Grant Instrument that upon a Change of Control (i) all outstanding
Options shall automatically accelerate and become fully exercisable, and (ii)
the restrictions and conditions on all outstanding Restricted Stock shall
immediately lapse. If the Committee does not provide such terms in the Grant
Instrument, a Change of Control will not impact a Grant.
10. Limitations on Issuance or Transfer of Shares. No Company Stock
shall be issued or transferred in connection with any Grant hereunder unless and
until all legal requirements applicable to the issuance or transfer of such
Company Stock have been complied with to the satisfaction of the Committee. The
Committee shall have the right to condition any Grant made to any Grantee
hereunder on such Grantee's undertaking in writing to comply with such
restrictions on his or her subsequent disposition of such shares of Company
Stock as the Committee shall deem necessary or advisable as a result of any
applicable law, regulation or official interpretation thereof, and certificates
representing such shares may be legended to reflect any such restrictions.
Certificates representing shares of Company Stock issued or transferred under
the Plan will be subject to such stop-transfer orders and other restrictions as
may be required by applicable laws, regulations and interpretations, including
any requirement that a legend be placed thereon.
11. Amendment and Termination of the Plan
--------------------------------------
(a) Amendment. The Board may amend or terminate the Plan at
any time; provided, however, that the Board shall not amend the Plan without
shareholder approval if such approval is required by Section l62(m) of the Code.
(b) Termination of Plan. The Plan shall terminate on the day
immediately preceding the tenth anniversary of its effective date, unless the
Plan is terminated earlier by the Board or is extended by the Board with the
approval of the shareholders.
(c) Termination and Amendment of Outstanding Grants. A
termination or amendment of the Plan that occurs after a Grant is made shall not
materially impair the rights of a Grantee unless the Grantee consents. The
termination of the Plan shall not impair the power and authority of the
Committee with respect to an outstanding Grant. Whether or not the Plan has
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terminated, an outstanding Grant may be terminated or amended in accordance with
the Plan or, may be amended by agreement of the Company and the Grantee
consistent with the Plan.
(d) Governing Document. The Plan shall be the controlling
document. No other statements, representations, explanatory materials or
examples, oral or written, may amend the Plan in any manner. The Plan shall be
binding upon and enforceable against the Company and its successors and assigns.
12. Funding of the Plan. This Plan shall be unfunded. The Company shall
not be required to establish any special or separate fund or to make any other
segregation of assets to assure the payment of any Grants under this Plan. In no
event shall interest be paid or accrued on any Grant, including unpaid
installments of Grants.
13. Rights of Participants. Nothing in this Plan shall entitle any
Employee, Key Advisor or other person to any claim or right to be granted a
Grant under this Plan. Neither this Plan nor any action taken hereunder shall be
construed as giving any individual any rights to be retained by or in the employ
of the Company or any other employment rights.
14. No Fractional Shares. No fractional shares of Company Stock shall
be issued or delivered pursuant to the Plan or any Grant. The Committee shall
determine whether cash, other awards or other property shall be issued or paid
in lieu of such fractional shares or whether such fractional shares or any
rights thereto shall be forfeited or otherwise eliminated.
15. Headings. Section headings are for reference only. In the event of
a conflict between a title and the content of a Section, the content of the
Section shall control.
16. Effective Date of the Plan.
--------------------------
(a) Effective Date. Subject to the approval of the Company's
shareholders, the Plan shall be effective on October 5, 2000.
(b) Public Offering. The provisions of the Plan that refer to
a Public Offering, or that refer to, or are applicable to persons subject to,
section 16 of the Exchange Act or section 162(m) of the Code, shall be effective
for so long as such stock is so registered.
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17. Miscellaneous
(a) Grants in Connection with Corporate Transactions and
Otherwise. Nothing contained in this Plan shall be construed to (i) limit the
right of the Committee to make Grants under this Plan in connection with the
acquisition, by purchase, lease, merger, consolidation or otherwise, of the
business or assets of any corporation, firm or association, including Grants to
employees thereof who become Employees of the Company, or for other proper
corporate purposes, or (ii) limit the right of the Company to grant stock
options or make other awards outside of this Plan. Without limiting the
foregoing, the Committee may make a Grant to an employee of another corporation
who becomes an Employee by reason of a corporate merger, consolidation,
acquisition of stock or property, reorganization or liquidation involving the
Company or any of its subsidiaries in substitution for a stock option or
restricted stock grant made by such corporation. The terms and conditions of the
substitute grants may vary from the terms and conditions required by the Plan
and from those of the substituted stock incentives. The Committee shall
prescribe the provisions of the substitute grants.
(b) Loans. The Committee may, in its discretion, extend a loan
in connection with the exercise or receipt of a grant under this Plan. The terms
and conditions of any such loan shall be set by the Committee.
(c) Compliance with Law. The Plan, the exercise of Options and
the obligations of the Company to issue or transfer shares of Company Stock
under Grants shall be subject to all applicable laws and to approvals by any
governmental or regulatory agency as may be required. With respect to persons
subject to section 16 of the Exchange Act, it is the intent of the Company that
the Plan and all transactions under the Plan comply with all applicable
provisions of Rule 16b-3 or its successors under the Exchange Act. The Committee
may revoke any Grant if it is contrary to law or modify a Grant to bring it into
compliance with any valid and mandatory government regulation. The Committee may
also adopt rules regarding the withholding of taxes on payments to Grantees. The
Committee may, in its sole discretion, agree to limit its authority under this
Section.
(d) Governing Law. The validity, construction, interpretation
and effect of the Plan and Grant Instruments issued under the Plan shall
exclusively be governed by and determined in accordance with the law of the
State of Florida, without regard to conflicts of laws principles.
Dated as of October 10, 2000.
MIZAR ENERGY COMPANY
By: /s/ Edward A. Saludes
--------------------------------------
Edward A. Saludes
President and Chief Executive Officer
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MIZAR ENERGY COMPANY
2400 E. Commercial Boulevard
Suite 221
Fort Lauderdale, FL 33308
PROXY
The undersigned hereby constitutes and appoints Edward Saludes as Proxy, with
the power to appoint his substitute, and hereby authorizes him to represent and
to vote as designated below, all shares of common stock of the Company held of
record by the undersigned on October 23, 2000, at the Special Meeting of
Stockholders to be held on November 10, 2000, or any adjournment thereof.
1. To reincorporate Mizar from the state of Colorado to the state of Florida
and to change the company's name to HBOA Holdings, Inc.
For [ ] Against [ ] Abstain [ ]
2. To approve Mizar Energy Company 2000 Equity Compensation Plan
For [ ] Against [ ] Abstain [ ]
3. Election of Directors
<TABLE>
<S> <C>
FOR all nominees listed below WITHHOLD AUTHORITY to vote
(Except as marked to the contrary) [ ] for all such nominees listed below [ ]
Edward Saludes Harvey Judkowitz William Shope Gary Verdier Robert Fivian
Marion & Carl Wolf*
*Marion and Carl Wolf share one seat on the Board of Directors and cast only one
vote.
</TABLE>
(INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE PLEASE
DRAW A LINE THROUGH THAT NOMINEE'S NAME)
4. In his discretion, the Proxy is authorized to vote upon such other business
as may properly come before the meeting or any adjournment thereof.
This Proxy is solicited on behalf of the Board of MIZAR ENERGY COMPANY. This
Proxy when properly executed will be voted in the manner directed herein by the
undersigned stockholder. If no direction is made, this Proxy will be voted FOR
the nominees listed in Proposal 1 and FOR Proposals 2 and 3.
The undersigned stockholder hereby acknowledges receipt of the Notice of Special
Meeting and Proxy Statement and hereby revokes any proxy or proxies heretofore
given. This proxy may be revoked at any time prior to the Special Meeting. If
you received more than one proxy card, please date, sign and return all cards in
the accompanying envelope.
Please sign exactly as the name appears below. When shares are held by joint
tenants, both should sign. When signing as attorney, executor, administrator,
trustee or guardian, please give full title as such. If a corporation, please
sign in the corporate name by President or other authorized officer. If a
partnership, please sign in partnership name by authorized person.
Dated:
--------------------------
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--------------------------------
Signature(s)
