SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Amendment No. 1
to
FORM 10-SB
GENERAL FORM FOR REGISTRATION OF SECURITIES OF
SMALL BUSINESS ISSUERS
Pursuant to Section 12(b) or (g) of the Securities Exchange Act of 1934
Swifty Carwash & Quik-Lube, Inc.
(Exact name of registrant as specified in its charter)
Florida 65-078-3722
(State or other jurisdiction of (I.R.S. Employer Identi-
incorporation or organization) fication No.)
17521 Crawley Road, Odessa, Florida 33556
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (813) 926-1603
Securities to be registered pursuant to
Section 12(b) of the Act:
Title of each class Name of each exchange on which
to be so registered each class is to be registered
Common stock, $.0001 par value
Class A Common Stock Warrants, $.01 par value
Securities to be registered pursuant to
Section 12(g) of the Act:
(Title of class)
n.a.
<PAGE>
Description of the Business.
Swifty Carwash is a Florida Corporation formed on September 23, 1997(the
"Company"). The Company is a successor to Steele Holdings, Inc., a Florida
Corporation formed on August 13, 1997. Rachel Steele was the sole shareholder of
Steele Holdings. On January 20, 1998, the Company and Steele Holdings, Inc.,
were reorganized with all the assets of Steele Holdings being transferred into
Swifty Carwash & Quik-Lube, Inc. In connection with the reorganization, all
contracts entered into by Steele Holdings were assigned to the Company for no
consideration. All the shares of Steele Holdings were exchanged for common
shares in the Company on a one to 1,000 basis. Steele Holdings had 6,000 shares
of common stock outstanding at the time of the reorganization. After the
reorganization, all stock in the Company was owned by the Company's president,
Rachel Steele. Steele Holdings has conducted no other business and was dissolved
on October 16, 1998.
The Company was formed to develop, own and operate a chain of full-service car
washes and express oil change centers (the "Centers"). The Company's founders
plan to capitalize on various trends that they believe will create demand for
the auto-related products and services to be provided by the Centers. One such
trend is the steady reduction in the number of gas stations providing routine
automobile maintenance such as oil changes. Thousands of the traditional,
full-service stations have closed and many others have been converted to
self-service stations offering no maintenance services. A second trend is the
increased demand for convenience created by Americans' busier lifestyles. A
majority of U.S. households now have two working spouses or a single working
adult. Work and family responsibilities have both reduced spare time and
increased the dependence on automobile transportation. As a result, fewer and
fewer Americans are taking the time to change their own oil and/or wash their
cars at home. Several companies have attempted to exploit these trends by
opening stand-alone car washes or quick-lube centers. The Company believes that
a market niche exists for the combination of these two services at one
establishment. Accordingly, the Company anticipates that its full service
Centers will be designed to fill this niche by offering a car wash, oil change
and fluid check within a 15 to 20 minute period, all without an appointment.
The Company has spent approximately $200 on demographic surveys of the area
surrounding the first Center in Palm Harbor, Florida compiled by Urban Decisions
Marketing, Inc. In addition to the trends discussed above, the Company is
targeting high growth, high traffic areas for its Centers. With the assistance
of data from Urban Decision MArketing, Inc. the Company found the area off of
U.S. Highway 19 in Palm Harbour, Florida to be an area of high urban growth
consistent with its target market for its first Center location. Additional
locations will be targeted in similar areas to capture what the Company believes
is its market niche.
The Company anticipates that each Center will contain a full service carwash,
car detailing station, oil change and lube bays and a retail area. The Centers
will be designed so that cars can drive through the oil and lube bays and then
drive through the carwash. The oil change and lube areas will be located in two
or three bays designed and equipped to provide oil and filter changes,
lubrication and replacement of most engine fluids. The service bays will each
feature a basement in order to eliminate the need for hydraulic lifts and allow
more than one technician to work on the car simultaneously. To increase
efficiency, one technician will work from the basement and another technician
will work at ground level. In addition to changing the oil, the technicians will
also lubricate the chassis, check and fill the transmission, brakes,
differential, power steering, window washer and battery fluids, check the air
filter and inflate the tires to the proper pressure. The Company plans to have
each Center use top-quality replacement motor oils, lubricants and filters as
part of its standard oil change. The Centers will be designed and stocked to
service almost every kind of vehicle, including foreign and older vehicles.
Certain parts and supplies offered by the Company will be sold on a consignment
basis, thereby reducing the amount of capital required for inventory.
The Company anticipates that each Center will be equipped with a 100-foot fully
automatic conveyer featuring touch free equipment. The equipment will be fully
computerized and will feature the latest technology in automated carwash
equipment. Each car will be vacuumed prior to entering the wash and window
interiors will be manually cleaned after the car exits the wash. Customers will
also be given the opportunity to choose from a variety of optional services such
as tire and interior treatment. The Company anticipates that each Center will
also feature a separate station providing complete auto detailing on an
expedited basis.
The Company plans for each Center to feature a customer lounge as well as a
snack bar with coffee, espresso and related items. The lounge will include a
retail area which will display a complete line of novelty and unique
accessories. From windows located along one wall of the retail area, customers
will be able to watch their cars as they are being washed.
The Company plans to use a computerized point of sale computer system in each
Center, enabling the Company's management to identify strengths and weaknesses
in each Center's operation. The computer system will also track customer data,
sales and employee information. Each Center's computer system will eventually be
linked to the Company's home office so that results can be analyzed by the
Company's management on a daily basis.
In addition to the Company's full-service Centers, the Company may in the future
develop one or more self-service Centers. The self-service Centers would be
placed in locations that are not large enough to otherwise be usable for a
full-service Center. Self-service Centers would probably consist of a series of
four to five bays in which customers can wash their own cars using a devise that
emits soap, pressurized water and wax. In addition, one bay may be dedicated to
a touchless carwashing machine. The Company has not determined when it may
develop self-service Centers, if ever, and accordingly, has not provided for the
development of self-service Centers in its business plans described herein.
Unless expressly stated otherwise, the use of the term "Center" throughout this
Registration Statement means a full-service Center, not a self-service Center.
The Company constructed its prototype Center in Palm Harbor Florida on real
property owned by the Company (hereinafter the "Prototype Center"). The
approximately one (1) acre site was purchased from Champion Hills by the
Company's predecessor for $312,500. The land was assigned to the Company along
with Steele Holdings' other assets in the reorganization. The Company entered
into a contract in the amount of $15,500 with Oliveri Architects for the design
of the Prototype Center. Equipment for the Prototype Center in the amount of
$271,000.10 was purchased from O'Hanrahan Consultant's, Inc. Its contract
provided for assistance with construction of the carwash and installation and
operation of the equipment. The first Center was opened on January 18, 1999. It
is too early to anticipate the profitability of operations at the first Center.
Letters of intent have been issued regarding acquisition of other Center sites
but none have been agreed upon as of January 26, 1999.
At its Prototype Center, the Company currently has four employees. The Company
anticipates that each Center will have approximately 15-20 full and part-time
employees, consisting of one manager, two assistant mangers, five to seven
clerical and sales personnel and seven to ten employees in the Center's carwash
and oil change operations. In addition, it has agreements for services with
Donald Hughes, Raymond Lipsch and Stanley Rabushka all of whom are officers or
founding shareholders in the Company.
The Company anticipates that it will participate in a product indemnification
program with Penzoil Products Company ("Penzoil") for the disposal of product
waste. Under the agreement, a Penzoil approved waste-oil hauler removes the oil
and lubricant waste from pre-approved containers on-site. Penzoil will agree to
indemnify the Company against any waste oil spills or improper disposal of the
waste oil materials. In addition, the Centers are built without any drainage in
the oil change pits to prevent accidental spills. 70% of the detergent and wax
products used in the carwash are recycled within a built-in reclaim system at
the Center. No permit was required to dispose of the additional waste products
in the public sewage system.
The Company is in the development stage of conducting its business. Its
operations are subject to various risks inherent in any start-up enterprise with
no operating history. New ventures, such as the Company, frequently encounter
unforeseen problems which often require more time and capital than budgeted, and
are subject to all of the risks inherent in the organization of a new business
venture. As a result of its developmental nature and its limited history, the
Company may be expected, at least initially, to continue to sustain operating
losses.
The officers and directors of the Company have no experience operating a
business of this type. The Company is working with consultants who have
experience in the industry: John Oster, and Edward O'Hanrahan. John Oster will
be given 10,000 shares of the Company's restricted common stock in exchange for
consulting regarding carwash start-up and operation for a period of one year.
There are other carwash companies and car lube companies with more operating
experience and financial resources than the Company. Currently, only minimal
revenue has been received by the Company from operations. There can be no
assurance that the Centers will be profitable.
The Company's business plan for the twelve months following registration
consists of completing the development of its first six Centers and the standard
operating policies and procedures that will be applicable to all Centers. The
Company anticipates that as the fifth and sixth Centers are being developed, the
Company will also open a centralized administrative office.
The Company has been able to complete the first Center without the funds from
its private offering which was completed in October 1998. The second Center will
require approximately all of the funds from the Company's private offering.
Funds raised from public sales of securities will be used to complete the
remaining Centers. In the event that an active trading market does not develop
for the Company's securities, the Company anticipates future cash requirements
will be met by borrowing from institutional lenders.
Description of the Property.
The Prototype Center began operations on January 18, 1999. It is located in Palm
Harbor, Florida, on U.S. Highway 19. The Prototype Center cost $1.2 million
dollars and the remaining Centers should cost between $800,000 and $900,000 to
construct. The subject property containing the Prototype Center consists of
approximately one (1) acre and previously received approval from Pinellas County
for site construction. A construction contract was entered into between the
Company and Brandon Construction Company for the Prototype Center construction
with the amount of $525,486 being paid to Brandon. The Company and Rachel
Steele, President of the Company, personally, entered into a promissory note
with People's Bank in the amount of $525,000 to cover the construction of the
carwash. The note has a maturity date of May 1, 2014 at a rate of one (1%)
percent in excess of the Prime Rate. Said note is secured by a mortgage on the
land owned in Pinellas County for the construction of the Prototype Center.
Sites for the other Centers have not been finalized.
Directors, Executive Officers and Significant Employees.
The following is a brief description of the educational and business experience
of each director, executive officer and key employee of the Company:
Rachel L. Steele, age 30, is a Director as well as President and Secretary of
the Company. Ms. Steele is a graduate of the University of Southern Florida with
a degree in Business Administration. Since graduating from college in May of
1994, Ms. Steele has spent the majority of her time managing her own investment
portfolio. In addition, Ms. Steele has from time to time provided certain
financial consulting services to individuals and corporations.
Raymond Lipsch, age 59, is a Director, Chief Executive Officer, Chief Financial
Officer and Treasurer of the Company. Mr. Lipsch attended Northwestern
University at Illinois. Mr. Lipsch has over 30 years of entrepreneurial and
management experience, specializing in the development of new companies,
developing new divisions and re-energizing troubled ones. Since 1992, Mr. Lipsch
has been engaged in the sales and marketing of insurance products, first as an
independent agent, then as a sales representative for American Express. Since
May 1994, Mr. Lipsch has been employed as a sales representative for Av-Med.
Donald C. Hughes, age 44, is a Director as well as a Vice President of the
Company. Mr. Hughes graduated from the University of Florida in 1977 with a
degree in Building Construction. In 1985, Mr. Hughes formed his own construction
company, Donald C. Hughes General Contractor, Inc., which has been in operation
for thirteen years and which engages primarily in the development and
construction of single family residences and small commercial buildings.
Stanley D. Rabushka, age 64, has been employed by the Company as a business
advisor and consultant since operations began in September 1997. Mr. Rabushka
graduated from Washington University in 1956 and 1958 with degrees of Bachelor
of Science in Engineering Physics and Master of Arts in Mathematics. After a
career involving scientific and engineering work for Emerson Electric and the
United States Government, among others, Mr. Rabushka served for more than 15
years as Vice President and General Manager for Louis Cap Company, a leading
manufacturer of men's headwear. Mr. Rabushka earned his Juris Doctoris degree
from Saint Louis University in 1977 and has been a practicing attorney since
that time with offices in St. Louis, Missouri. Mr. Rabushka, however, will not
provide legal service for the Company, as the Company has retained other counsel
for that purpose.
The above listed individuals have been officers and directors of the Company
since its reorganization on January 20, 1998. No voting arrangements exist and
the above persons were selected pursuant to provisions in Article IV of the
Company's By-Laws, all holding office for a period of one year or until their
successors are elected and qualified. None of the officers or directors of the
Company have been involved in legal proceedings during the past five years which
are material to an evaluation of the ability or integrity of any director,
person nominated to become a director, or executive officer of the issuer,
including any state or Federal criminal and bankruptcy proceedings.
Remuneration of Directors and Officers.
Name of Individual Capacities in which Aggregate Renumeration
Was received
Rachel Steele President $ 96,166
Raymond Lipsch Consultant $ 72,500
Donald Hughes Consultant $210,000
None of the Company's officers currently receive a salary from the Company, and
all but Ms. Steele are engaged in other enterprises on a full-time basis. Rachel
Steele has received advances in lieu of salary totaling $96,166 which have been
repaid at a rate of eight (8%) percent interest as of December 31, 1998. This
advance was for the time from start-up until the beginning of the Company's
public offering, during which time she acted on behalf of the Company arranging
the construction of the first Center and preparing to list the Company's stock
on over-the-counter markets. Although the Company anticipates entering into an
employment contract with Ms. Steele in the future, no agreements have been
reached regarding the terms of any future compensation.
Since the reorganization and through November 15 1998, Mr. Lipsch has received
compensation for consulting services totaling $72,500 pursuant to his oral
agreement for regarding the private and public offerings for a time not less
then 250 hours per year. Mr. Lipsch's contract provides for this same
arrangement every calendar year expiring on November 15, 2001. The Company has
not reached any agreement regarding future compensation to Mr. Lipsch beyond
November 2001.
Don Hughes as president of Don Hughes General Contractor, Inc., who is also a
Director and Vice-President of Swifty, has entered into a contract with the
Company to provide consulting services in construction and real estate for which
a sum of $210,000 was deposited for his use. None of the funds have been used as
of the date of this offering. This arrangement is anticipated to be applied when
the second Center site is located, to end after its construction. Mr. Hughes'
contract provides that his Corporation will provide construction services for
the Centers when agreeable to both parties. No agreements regarding compensation
beyond the terms of the aforementioned contract have been reached between the
Company and Mr. Hughes.
The above three officers of the Company may be paid a salary at some point in
the future as their responsibilities as Directors with the Company increase. At
this time, the Company does not plan on paying its Board of Directors in return
for their services as Directors.
Security Ownership of Management and Certain Security Holders.
None of the officers and directors has received a salary during the past twelve
months. There are no officer or director groups. The Offering referred to below
is the Company's private offering of securities which was completed in October
of 1998. As a group, the officers and directors of the Company own 81% of the
outstanding shares of common stock.
Title Name and Amount owned Amt owned Percent
of Address before the After of
Class of Owner Offering Offering Class
Common ....... Rachel L. Steele 5,940,000 5,940,000 71%
Stock 17521 Crawley Road
Odessa, FL 33556
Common ....... Stanley and Arlene 1,400,000 1,400,000 17%
Stock ........ Rabushka
250 South Brentwood,
Suite 4-L
St. Louis, MO 63105
Common ....... Raymond Lipsch 600,000 611,520 07%
Stock 19522 Michigan Avenue
Odessa, FL 33556
Common ....... Donald Hughes 235,000 267,720 03%
Stock 3112 Harborview Avenue
Tampa, FL 33611
Common
Stock ........ Total 8,175,000 8,219,240 98%
Warrants
Name of Title and amount Exercise Date
securities called for by of
Holder options, warrants or rights price Exercise
Donald Hughes Class A Common Stock 65,440 7.25 12/31/00
Raymond
Lipsch Class A Common Stock 23,040 7.25 12/31/00
Interest of Management and Others in Certain Transactions.
Rachel Steele received advances in lieu of salary totaling $96,166 which have
been repaid at a rate of eight (8%) percent interest as of December 31, 1998.
This advance was for the time from start-up until the beginning of the Company's
public offering, during which time she acted on behalf of the Company arranging
the construction of the first Center and preparing to list the Company's stock
on over-the-counter markets.
Mr.Lipsch has received compensation for consulting services totaling $72,500
pursuant to his agreement regarding the private and public offerings for a time
of not less then 250 hours per year. Mr. Lipsch's contract provides for this
same arrangement every calendar year expiring on November 15, 2001.
Don Hughes as president of Don Hughes General Contractor, Inc., who is also a
Director and Vice-President of Swifty, has entered into a contract with the
Company to provide consulting services in construction and real estate for which
a sum of $210,000 was deposited for his use. None of the funds have been used as
of the date of this offering. This arrangement is anticipated to be applied when
the second Center site is located, to end after its construction. Mr. Hughes'
contract provides that his Corporation will provide construction services for
the Centers when agreeable to both parties.
Securities being Registered.
As of November 17, 1998, there are 8,394,120 shares and 318,240 Purchase
Warrants outstanding. 8,235,000 shares of the Company's stock are restricted
and may only be resold pursuant to Rule 144. 159,120 shares have been issued
pursuant to Rule 504 without restrictive legend.
Each share of issued and outstanding stock shall entitle the holder thereof to
fully participate in all shareholder meetings, to cast one vote on each matter
with respect to which shareholders have the right to vote, and to share ratably
in all dividends and other distributions declared and paid with respect to the
common stock, as well as in the net assets of the Company upon liquidation or
dissolution.
Warrants may be exercised at any time after 30 days from their issue date
through December 31, 2000. Each one is redeemable at a price of $0.01 subject to
the right of the holder to exercise his/her/its purchase rights thereunder
within a period of 30 days following the issuance of the Company's written
notice of redemption. The Company may reduce the exercise price of the warrants
for limited periods or through the end of the warrants exercise period if deemed
appropriate. The warrants are subject to price adjustments upon the occurence of
certain events including: (a) subdivisions or combinations of the common stock;
(b) merger of the Company with or into any other corporation; and (c) a
distribution of Company assets.
Market Price of and Dividends on the Registrant's Common Equity and
Other Shareholder Matters.
The Company has authorized 50,000,000 shares of common stock. There is currently
no public trading market for the Company's securities. This is the Company's
initial registration statement. The approximate number of holders of record of
each class of common equity securities is 28. No dividends have been declared to
date. The future dividend policy will depend upon the Company's earnings,
capital requirements, financial condition and other factors considered relevant
by the Company's Board of Directors. As of the date of registration none of the
outstanding warrants have been exercised.
Legal Proceedings.
The Company is not a party to any pending legal proceedings.
Changes in and Disagreements with Accountants.
The Company has not had any disagreement with its independent auditor on any
matter of accounting principles or practices or financial statement disclosure.
Recent Sales of Unregistered Securities.
Prior to its private offering, the Company sold shares to its officers and
directors as set forth above. Additional sales to qualifying purchasers have
been made by the officers of the Company pursuant to Regulation D, Rule 504. The
Company did not pay any sales commissions or discounts to any person for the
cash sales for any shares and no public solicitation was used. No underwriter
has participated in the sales made to date. The total offering price was one
million dollars. Each Unit sold contained 800 shares of common stock and 1,600
Common Stock Purchase Warrants. The price for each Unit was $5,000. 198.9 Units
were sold for a total consideration of $994,500 was raised under the exempt
offering.
Indemnification of Directors and Officers.
The Company has no provision for indemnification in its By-Laws. Section
607.0850 of the Florida Statutes authorizes the Company to indemnify any person
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 Company and, with respect
to any criminal action or proceeding, had no reasonable cause to believe his or
her conduct was unlawful. The termination of any proceeding by judgment, order,
settlement, or conviction or upon a plea of nolo contendere or its equivalent
shall not, of itself, create a presumption that the person did not act in good
faith and in a manner which he or she reasonably believed to be in, or not
opposed to, the best interests of the Company or, with respect to any criminal
action or proceeding, had reasonable cause to believe that his or her conduct
was unlawful. A Company shall have the power to indemnify any person against
expenses and amounts paid in settlement not exceeding, in the judgment of the
board of directors, the estimated expense of litigating the proceeding to
conclusion, actually and reasonably incurred in connection with the defense or
settlement of such proceeding, including any appeal thereof.
<PAGE>
Financial Statements
The Company's financial statements for the years ended December 31, 1997 have
been examined to the extent indicated in their reports by Pender Newkirk &
Company, independent certified public accountants and have been prepared in
accordance with generally accepted accounting principles and pursuant to
Regulation S-B as promulgated by the Securities Exchange Commission and are
included herein.
The Company's financial statements from January 1, 1998 through September 30,
1998 are unaudited and have been prepared in accordance with generally accepted
accounting principles.
Financial Statements
Swifty Carwash & Quik-Lube, Inc.
(A Development Stage Enterprise)
Periods August 13, 1997 (Date of Inception)
through September 30, 1998
Independent Auditors' Report
<PAGE>
Swifty Carwash & Quik-Lube, Inc.
Financial Statements
Periods August 13, 1997 (Date of Inception)
through September 30, 1998
Contents
Independent Auditors' Report on Financial Statements..........................
Financial Statements:
Balance Sheets............................................................
Statements of Operations..................................................
Statements of Changes in Stockholders' Equity.............................
Statements of Cash Flows..................................................
Notes to Financial Statements.............................................
<PAGE>
Independent Auditors' Report
Board of Directors
Swifty Carwash & Quik-Lube, Inc.
(A Development Stage Enterprise)
Odessa, Florida
We have audited the accompanying balance sheet of Swifty Carwash & Quik-Lube,
Inc. (a development stage enterprise) as of December 31, 1997 and the related
statements of operations, changes in stockholders' equity, and cash flows for
the period then ended. These financial statements are the responsibility of the
management of Swifty Carwash & Quik-Lube, Inc. Our responsibility is to express
an opinion on these financial statements based on our audit.
We conducted our audit in accordance with generally accepted auditing standards.
These standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Swifty Carwash & Quik-Lube,
Inc. as of December 31, 1997 and the results of its operations and its cash
flows for the period then ended in conformity with generally accepted accounting
principles.
Pender Newkirk & Company
Certified Public Accountants
Tampa, Florida
January 30, 1998, except for the first paragraph of Note 6, as to which the date
is February 18, 1998.
<PAGE>
Swifty Carwash & Quik-Lube, Inc.
(A Development Stage Enterprise)
Balance Sheets
September 30, December 31,
1998 1997
(Unaudited)
Assets
Current assets:
Cash and cash equivalents $ 86,649 $ 357,419
Advances to stockholder 14,500
---------------------------------------
Total current assets 101,149 357,419
---------------------------------------
Building and equipment not
yet placed in service 956,411 18,393
---------------------------------------
Other assets:
Advances to stockholder,
net of current portion 84,666
Deposits 243,948 18,948
Offering costs 8,862 10,166
Organizational costs 749 749
---------------------------------------
Total other assets 338,225 29,863
---------------------------------------
$ 1,395,785 $ 405,675
=======================================
Liabilities and Stockholders'
Equity Current liabilities:
Accounts payable $ 287,099 $ 7,705
Income taxes payable 250
Current portion of note payable 2,161
---------------------------------------
Total current liabilities 289,260 7,955
---------------------------------------
Long-term liabilities:
Stock payable 10,000
Note payable, net of current portion 204,525
---------------------------------------
Total long-term liabilities 204,525 10,000
---------------------------------------
Stockholders' equity:
Common stock; $.0001 par value;
50,000,000 shares authorized;
8,350,920 and 6,000,000 shares
issued and outstanding at
September 30, 1998 (unaudited)
and December 31, 1997, respectively 835 600
Paid in capital 1,127,438 385,777
(Deficit) retained earnings
accumulated during
development stage (226,273) 1,343
---------------------------------------
Total stockholders' equity 902,000 387,720
---------------------------------------
$ 1,395,785 $ 405,675
=======================================
Read independent auditors' report. The accompanying notes are an integral part
of the financial statements.
<PAGE>
Swifty Carwash & Quik-Lube, Inc.
(A Development Stage Enterprise)
Statements of Operations
<TABLE>
<CAPTION>
Period Period
Nine-Month August 13, 1997 August 13, 1997
Period Ended (Date of Inception) (Date of Inception)
September 30, through September 30, through December 31,
1998 1998 1997
________________________________________________________________
(Unaudited) (Unaudited)
<S> ................... <C> <C> <C>
Operating and start-up
expenses ...................................... $ 231,036 $ 233,891 $ 2,855
_________________________________________________________________
Loss from operations .............................. (231,036) (233,891) (2,855)
Interest income ................................... 6,512 10,960 4,448
Interest expense .................................. (3,092) (3,092)
_________________________________________________________________
(Loss) income before
income taxes .................................. (227,616) (227,023) 1,593
Income taxes ...................................... 250 250
__________________________________________________________________
Net (loss) income ................................. $ (227,616) $ (226,273) $ 1,343
==================================================================
Loss per common share ............................. $ (.03) $ (.03) $ 0.00
==================================================================
Weighted average common
shares outstanding ............................ 8,116,243 7,409,441 6,000,000
==================================================================
</TABLE>
Read independent auditors' report. The accompanying notes are an integral part
of the financial statements.
<PAGE>
Swifty Carwash & Quik-Lube, Inc.
(A Development Stage Enterprise)
Statements of Changes in Stockholders' Equity
Periods August 13, 1997 (Date of Inception)
through September 30, 1998
<TABLE>
<CAPTION>
Retained Earnings
(Deficit)
Common Stock Paid In Accumulated During
Shares Amount Capital Development Stage
____________________________________________________________
<S> ....................................................... <C> <C> <C> <C>
Common stock issued for cash,
August 1997 ................................................. 6,000,000 $ 600 $ 149,400
Contributed capital for cash and
reimbursement of expenditures,
September 1997 ............................................. 236,377
Income for period ............................................... $ 1,343
_____________________________________________________________
Balance, December 31, 1997 ...................................... 6,000,000 600 385,777 1,343
Common stock issued January
1998 (unaudited) ............................................ 2,235,000 223 22,127
Common stock issued through Regulation D
Offering, net of offering costs of
$23,304, March 1998 through September
1998 (unaudited) ............................................ 115,920 12 684,534
Services donated by stockholder(unaudited) 35,000
Loss for period (unaudited) ...................................... (227,616)
______________________________________________________________
Balance, September 30, 1998
(unaudited) .................................................. 8,350,920 $ 835 $ 1,127,438 $(226,273)
==============================================================
</TABLE>
Read independent auditors' report. The accompanying notes are an integral part
of the financial statements.
<PAGE>
Swifty Carwash & Quik-Lube, Inc.
(A Development Stage Enterprise)
Statements of Cash Flows
<TABLE>
<CAPTION>
Period Period
Nine-Month August 13, 1997 August 13, 1997
Period Ended (Date of Inception) (Date of Inception)
September 30, through September through December 31,
1998 30, 1998 1997
______________________________________________________
(Unaudited) (Unaudited)
<S> ............................................................ <C> <C> <C>
Operating activities
Net (loss) income .......................................... $ (227,616) $ (226,273) $ 1,343
______________________________________________________
Adjustments to reconcile net (loss)
income to net cash and cash
equivalents (used) provided by
operating activities:
Contributed services................................ 35,000 35,000
Increase in accounts payable ........................ 36,500 36,500
Decrease in income taxes payable .................... (250) 250
_____________________________________________________
Total adjustments .......................................... 71,250 71,500 250
_____________________________________________________
Net cash (used) provided by operating
activities ............................................. (156,366) (154,773) 1,593
_____________________________________________________
Investing activities
Acquisition of building and equipment ...................... (695,124) (707,286) (6,162)
Increase in deposits, offering costs,
and organizational costs ............................... (223,696) (245,644) (27,948)
____________________________________________________
Net cash used by investing activities ...................... (918,820) (952,930) (34,110)
____________________________________________________
Financing activities
Proceeds from issuance of notes payable .................... 206,686 206,686
Net proceeds from issuance of stock and
contribution of cash ................................... 706,896 1,086,832 379,936
Advances to stockholder..................................... (99,166) (99,166)
(Increase) decrease in stock payable ....................... (10,000) 10,000
__________________________________________________
Net cash provided by financing activities .................. 804,416 1,194,352 389,936
__________________________________________________
Net (decrease) increase in cash and
cash equivalents ........................................... (270,770) 86,649 357,419
Cash and cash equivalents, beginning
of period .................................................. 357,419
__________________________________________________
Cash and cash equivalents, end of period ....................... $ 86,649 $ 86,649 $ 357,419
==================================================
</TABLE>
Read independent auditors' report. The accompanying notes are an integral part
of the financial statements.
<PAGE>
Swifty Carwash & Quik-Lube, Inc.
(A Development Stage Enterprise)
Statements of Cash Flows
Periods August 13, 1997 (Date of Inception)
through September 30, 1998
Supplemental disclosures of noncash investing and financing activities:
During the period August 13, 1997 (date of inception) through December 31,
1997, the Company recorded offering costs, organization costs, project
costs, and equipment totaling $6,441 as contributed capital which were
unreimbursed expenditures incurred by the stockholder.
During the period August 13, 1997 (date of inception) through December 31,
1997, the Company incurred a payable in connection with the incurrence of
$7,705 of capitalized offering costs.
During the period ended September 30, 1998, the Company incurred a payable
of $242,894 (unaudited) in connection with its acquisition of equipment.
During the period ended September 30, 1998, the Company reduced paid in
capital by $23,304 of offering costs.
Read independent auditors' report. The accompanying notes are an integral part
of the financial statements.
<PAGE>
Swifty Carwash & Quik-Lube, Inc.
(A Development Stage Enterprise)
Notes to Financial Statements
Periods August 13, 1997 (Date of Inception)
through September 30, 1998
1. Basis of Presentation and Reorganization
Steele Holdings, Inc. (a Florida corporation) was incorporated on August 13,
1997. Swifty Carwash & Quik-Lube, Inc. (a Florida corporation) was incorporated
on September 23, 1997. On January 20, 1998, these companies entered into a plan
of reorganization whereby Steele Holdings, Inc. transferred to Swifty Carwash &
Quik-Lube, Inc. all of its assets in exchange for 6,000,000 shares of stock
which represented all of the stock outstanding of Swifty Carwash & Quik-Lube,
Inc. These shares were immediately distributed to the stockholder of Steele
Holdings, Inc. in complete liquidation and cancellation of its stock. The
accompanying financial statements reflect this reorganization in a manner
similar to a pooling of interest and as though it occurred on August 13, 1997.
As part of this reorganization, 2,235,000 shares of stock were issued to three
officers who were considered to be founders. The Company valued these shares at
$.01 per share, an amount they determined to be a fair value based on the risk
and uncertainty of this start-up company.
Since inception of the above companies, they have been in their development
stage, devoting all of their efforts to the development of a car wash and oil
change facility in Pinellas County, Florida.
2. Significant Accounting Policies
The significant accounting policies followed are:
The preparation of financial statements in accordance with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities
and disclosure of contingent assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those
estimates.
In the opinion of management, all adjustments consisting only of normal
recurring adjustments necessary for a fair presentation of (a) the
results of operations for the nine-month period ended September 30, 1998
and the period August 13, 1997 (date of inception) through September 30,
1998, (b)
Read independent auditors' report.
<PAGE>
Swifty Carwash & Quik-Lube, Inc.
(A Development Stage Enterprise)
Notes to Financial Statements
Periods August 13, 1997 (Date of Inception)
through September 30, 1998
2. Significant Accounting Policies (continued)
the financial position at September 30, 1998, and (c) cash flows for the
nine-month period ended September 30, 1998 and period August 13, 1997
(date of inception) through September 30, 1998, have been made.
Cash equivalents consist of highly liquid debt instruments purchased
with a maturity of three months or less.
The Company maintains cash accounts in excess of the Federal Deposit
Insurance Corporation's insured limit of $100,000.
Building and equipment are stated at cost. Depreciation is calculated
over the useful lives of the assets. No depreciation has been recorded
in the accompanying financial statements since the equipment has not
been placed into service.
During the period ended December 31, 1997, costs pertaining to the
acquisition and construction of facilities had been capitalized as
project costs and were transferred to building and equipment during the
period ended September 30, 1998.
Loss per share is based on the weighted average number of common shares
outstanding during each period after giving effect to the
recapitalization described in Note 1. The Company has implemented SFAS
No. 128. There is no effect on the prior loss per share amounts based on
this statement. In computing diluted earnings per share, warrants
exercisable into 231,840 shares were excluded because the effects were
antidilutive.
Costs incurred in connection with the expected private placement
memorandum have been capitalized as offering costs and will be offset
against proceeds from the offering.
Read independent auditors' report.
<PAGE>
Swifty Carwash & Quik-Lube, Inc.
(A Development Stage Enterprise)
Notes to Financial Statements
Periods August 13, 1997 (Date of Inception)
through September 30, 1998
2. Significant Accounting Polices (continued)
Organizational costs are capitalized and amortized over 60 months
beginning in 1998.
Deferred tax assets and liabilities are recognized for the estimated
future tax consequences attributable to differences between the
financial statements carrying amounts of existing assets and liabilities
and their respective income tax bases. Deferred tax assets and
liabilities are measured using enacted tax rates expected to apply to
taxable income in the years in which those temporary differences are
expected to be recovered or settled. The effect on deferred tax assets
and liabilities of a change in tax rates is recognized as income in the
period that included the enactment date.
Certain minor reclassifications have been made in the 1997 financial
statements to conform to the classifications used in 1998.
3. Building and Equipment Not Yet Placed In Service
Building and equipment not yet placed in service consist of:
September 30, December 31,
1998 1997
(Unaudited)
Land and buildings $ 595,554
Furniture and fixtures 9,487
Machinery and equipment 351,370 $ 10,049
Project costs 8,344
---------------------------------------
$ 956,411 $ 18,393
=======================================
The Company has not recorded depreciation expense on these assets as they have
not been placed in service as of September 30, 1998 (unaudited).
Read independent auditors' report.
<PAGE>
Swifty Carwash & Quik-Lube, Inc.
(A Development Stage Enterprise)
Notes to Financial Statements
Periods August 13, 1997 (Date of Inception)
through September 30, 1998
4. Note Payable
The note payable as of September 30, 1998 (unaudited) consists of:
Note payable to bank; construction loan; maximum amount of $525,000;
interest at prime plus 1.0% (9.25% at September 30, 1998); interest
only through May 1999; principal and interest payments of
approximately $2,100 per month beginning June 1999 through May 2014;
secured by mortgage;
personally guaranteed by the majority stockholder $ 206,686
Less amounts currently due 2,161
-----------
$ 204,525
The following is a schedule by year of the approximate principal payments
required on this note as of September 30, 1998 (unaudited):
1999 $ 2,161
2000 6,895
2001 7,561
2002 8,291
2003 9,091
Thereafter 172,687
-----------
$ 206,686
5. Income Taxes
The Company anticipates a taxable loss for the year ending December 31, 1998.
The Company has not recorded any benefit from this anticipated loss due to the
uncertainty of its realization in the future.
Read independent auditors' report.
<PAGE>
Swifty Carwash & Quik-Lube, Inc.
(A Development Stage Enterprise)
Notes to Financial Statements
Periods August 13, 1997 (Date of Inception)
through September 30, 1998
6. Stock Offering (Unaudited)
On February 18, 1998, Swifty Carwash & Quik-Lube, Inc., the successor company,
herein after referred to as "the Company," offered 160,000 shares of common
stock and 320,000 common stock warrants through a private placement memorandum
to raise $1.0 million. Each warrant will entitle the holder to purchase one
share of the Company's common stock at $7.25 per share at any time after 30 days
from their issue date through December 31, 2000. Prior to their expiration, each
warrant may be redeemable by the Company at a price of $.01.
As of September 30, 1998 (unaudited), 115,920 shares of stock and 231,840 common
stock warrants have been issued under the above offering.
7. Commitments and Related Party Transactions
During the period ended September 30, 1998, subsequent to the Company's
reorganization, the Company issued 2,235,000 shares of stock to directors and
officers at $.01 per share (unaudited).
At September 30, 1998, the Company had $99,166 (unaudited) of advances to a
stockholder. Subsequent to September 30, 1998, $96,166 of this amount was
formalized into an unsecured promissory note which bears interest at eight
percent (unaudited). The note is to be repaid to the Company in quarterly
installments of principal and interest of $5,000 beginning on November 15, 1998
until the balance is repaid in full.
During the development stage, the president performed services for the Company
at no cost. The Board of Directors valued these services at $35,000 and recorded
this amount as additional paid-in capital.
The above related party agreements are not necessarily indicative of the
agreements that would have been entered into by independent parties.
During the period ended September 30, 1998, the Company entered into a contract
to construct a car wash facility for a total contract price, including change
orders, of approximately $546,000. As of September 30, 1998, approximately
$207,000 (unaudited) of construction costs have been incurred under this
contract.
On August 8, 1998, the Company entered into a consulting and contracting
agreement with a stockholder whereby the stockholder will explore, investigate,
and locate appropriate parcels of land and supplies of equipment on behalf of
the Company. In addition, the stockholder will provide certain construction
services to the Company. In exchange for these services, the Company will pay
the stockholder between three and five percent of the total costs of projects
which have been negotiated or performed by the stockholder. Included in deposits
at September 30, 1998 is $210,000 (unaudited) paid to the stockholder in
connection with this agreement.
Read independent auditors' report.
<PAGE>
Exhibits
Index to Exhibits............................................................25
SWIFTY CARWASH & QUIK-LUBE, INC.
INDEX TO EXHIBITS
(1)Underwriting Agreement
(2)Charter and By-Laws........................................................
*(a)Articles of Incorporation.............................. ..............
(b)By-Laws...............................................................
(3)Instruments Defining the Rights of Security Holders
*(a)Subscription Agreement................................................
*(b)Warrant Agreement.....................................................
(5)Voting Trust Agreements
(6)Material Contracts.........................................................
*(a)Equipment Purchase Contract...........................................
*(b)Construction Contract.................................................
*(c)Architect Contract....................................................
*(d)Consulting Contract-Donald Hughes.....................................
*(e)Employment Contract-Stanley Rabushka..................................
*(f)Promissory Note - Swifty..............................................
*(g)Promissory Note - Steele .............................................
*(h)Consulting Contract-John Oster .......................................
*(i)Raymond Lipsch Contract ..............................................
*(j)Land Purchase Contract................................................
(7)Material Foreign Patents
*(8)Plan of Acquisition, Reorganization,
Arrangement, Liquidation or Succession........................................
(9)Escrow Agreements
(10)Consents
(11)Opinion re: Legality
(12)Sales Materials
(13)"Test the Water" Material
(14)Appointment of Agent for Service of Process
(15)Additional Exhibits
* Previously filed with Form 10-SB on November 23, 1998.
<PAGE>
In accordance with Section 12 of the Securities Exchange Act of 1934, the
registrant caused this registration statement Amendment No. 1 to Form 10-SB to
be signed on its behalf by the undersigned, thereunto duly authorized.
Swifty Carwash & Quik-Lube, Inc.
Date: January 29, 1999
By: /s/ Rachel Steele
-----------------------
Rachel Steele, President
BY-LAWS
OF
SWIFTY CARWASH & QUIK-LUBE, INC.
ARTICLE I
Share Certificates and Transfer
Section 1. Certificates:
Certificates representing the shares of capital stock of this Corporation shall
be printed or engraved in such form and contain such recitals, signatures and
seals as required by law, or to the extent not in conflict therewith, as may be
determined by the Board of Directors. Every Shareholder shall be entitled to
receive a certificate representing the number of shares owned once such shares
are fully paid.
Section 2. Transfer:
Upon surrender to the secretary or transfer agent of the Corporation of a
certificate representing a share or shares of its stock, duly endorsed or
accompanied by evidence of succession, assignment or authority to transfer
reasonably satisfactory to the Secretary or transfer agent, as well as all
necessary Florida stock transfer tax stamps or the funds therefor and evidence
of compliance with any conditions or restrictions set forth or referred to on
the certificate, the Corporation shall be required to issue a new certificate to
the person entitled thereto, cancel the old certificate and record the
transaction on its books.
Section 3. Issuance of Substitute Certificates:
A new certificate may be issued in lieu of any certificate previously issued
which has been defaced or mutilated, upon surrender or cancellation of a part of
the old certificate sufficient, in the opinion of the Treasurer, to protect the
Corporation against loss or liability. A new certificate may also be issued in
lieu of any certificate then not in the possession of the holder of record if
such holder shall by written affirmation, under oath, state the circumstances of
its absence, and shall, if required by the Board, provide the Corporation with
an indemnity bond in form and with one or more sureties satisfactory to the
Board, in at least double the value of the shares represented by the absent
certificate and satisfy any other reasonable requirements which it may impose.
ARTICLE II
Corporate Records and Seal; Authority to Act
Section 1. Records:
The Corporation shall maintain at its principal place of business accurate and
complete records of its operations and properties, including a record of its
Shareholders and minutes of the proceedings of its Shareholders, Board of
Directors and Board committees. Unless modified by Shareholder resolution
adopted not later than four months following the close of each of the
Corporation's operational years, the Corporation shall prepare within a
reasonable time following the close of each such year and maintain at its
principal place of business, as well as at its registered office, financial
records which shall include a statement of financial position as of the end of
each such year and a statement of profit earned or loss incurred therein.
Section 2. Inspection:
All records required by the Florida Business Corporation Act to be maintained by
the Corporation shall be open for inspection by the individuals and in the
manner specified in such Act as the same may be in effect from time to time.
Section 3. Closing Shareholder Record Book:
The Board may close the Shareholder record book for a period of not more than 30
nor less than ten days preceding any Shareholder meeting or the day fixed for
the payment of a dividend, and upon its failure to do so the Shareholder record
date for either purpose shall be 14 days preceding the event.
Section 4. Seal:
The Corporation shall own a corporate seal which shall be circular in form and
have inscribed thereon its name and the date and state of its incorporation.
Section 5. Contracts:
The Board of Directors may by resolution authorize any officer or agent to enter
into any contract or execute and deliver any instrument in the name of or on
behalf of the Corporation, and such authority may be general or confined to
specific instances; but absent the grant of such authority no individual, other
than the President, shall have power to bind the Corporation under any contract,
pledge its credit or render it liable for any purpose or in any amount.
Section 6. Checks and Drafts:
All checks, drafts or other orders for the payment of money, notes or other
evidences of indebtedness issued in the name of the Corporation shall be signed
or endorsed by such person or persons and in such manner as shall be determined
by resolution of the Board of Directors.
-2-
<PAGE>
ARTICLE III
Shareholder Meetings and Voting Rights
Section 1. Annual Meetings:
The annual meeting of the Shareholders of the Corporation shall be held on the
first Tuesday of the fourth month following the close of the Corporation's
operational year. If that day is a legal holiday, the annual meeting will be
held on the first day thereafter that is not a legal holiday. At the annual
meeting the Shareholders, by vote of the holders of a majority of the shares
represented, shall elect a Board of Directors, consider reports of the affairs
of the Corporation and transact such other business as is properly brought
before the meeting.
Section 2. Special Meetings:
Special Shareholder meetings shall be held upon the direction of the President
or Board of Directors or upon the written request of the holders of not less
than ten percent of all shares entitled to vote.
Section 3. Place of Meeting:
All Shareholder meetings shall be held at the principal office of the
Corporation unless an alternate location shall be selected by the Board and
communicated to the Shareholders by written notice. The holders of a majority of
shares of the Corporation's outstanding voting stock shall have the right to
reject such alternative location by filing written notice to that effect with
the Secretary not less than two days prior to the called date of the meeting.
Section 4. Notice:
Written notice stating the place, day and hour of each Shareholder meeting and,
in the case of a special meeting, the nature of the business to be transacted
shall be delivered to each Shareholder of record entitled to vote not less than
ten days prior to the date of such meeting and otherwise in the manner specified
in the Florida Business Corporation Act. When a meeting is adjourned for 30 days
or more, notice of the adjourned meeting shall be given as in the case of the
original meeting; otherwise no notice of the adjournment or of the business to
be transacted at the adjourned meeting need be given other than by way of an
announcement made at the meeting at which such adjournment is taken.
-3-
Section 5. Voting List:
Unless the Corporation has fewer than six Shareholders, as of the date fixed in
accordance with the provisions of Article II, Section 3., the officer or agent
having charge of the Shareholder record books shall prepare a list of the
Shareholders entitled to vote at each Shareholder meeting or any adjournment
thereof, including the address of and the number and class and series, if any,
of shares held by each. For a period of ten days prior to the meeting, such list
shall be kept at the Corporation's principal place of business where any
Shareholder shall be entitled to inspect it during usual business hours. The
list shall also be made available and subject to inspection by any Shareholder
at any time during the subject meeting.
Section 6. Substance of Meeting:
Any question may be considered and acted upon at an annual meeting, but no
question not stated in the call for a special meeting shall be acted upon
thereat unless the provisions of Article III, Section 9. or Article VI, Section
3. are complied with.
Section 7. Shareholders' Quorum and Voting Rights:
The holders of a majority of the shares entitled to vote, present in person or
represented by proxy, shall constitute a quorum at all meetings of the
Shareholders, unless otherwise provided by law, but a lesser interest may
adjourn any meeting from time to time until the requisite amount of voting
shares shall be present.
Each outstanding share of the Corporation's capital stock shall entitle the
holder of record to one vote. An affirmative vote of a majority of the shares
represented at each meeting shall decide any question brought before it, unless
the question is one upon which, by express provision of law, the Corporation's
Articles of Incorporation or these By-Laws, a larger or different vote is
required, in which case such express provision shall govern and control the
decision of such question.
Section 8. Proxies:
Every Shareholder entitled to vote, or to express consent to or dissent from a
proposed corporate action, may do so either in person or by written proxy duly
executed and filed with the Secretary of the Corporation. If a proxy is
executed, its use shall be controlled by the provisions of the Florida Business
Corporation Act.
-4-
Section 9. Action By Shareholders Without a Meeting:
Any action required or allowed to be taken at a meeting of Shareholders may be
taken without a meeting, prior notice or vote, if a written consent, setting
forth the action taken, shall be signed by the holders of outstanding shares
having not less than the minimum number of votes that would be necessary to
authorize or take such action at a meeting at which all shares entitled to vote
thereon were present and voted, and the written consent specified in the Florida
Business Corporation Act shall be obtained and furnished to all non-consenting
Shareholders.
ARTICLE IV
Board of Directors
Section 1. Power and Responsibility:
Subject to the limitations imposed by the Articles of Incorporation, these
By-Laws or the Florida Business Corporation Act, all corporate powers and
responsibilities shall be exercised by or under the authority of, and the
business and affairs of the Corporation shall be controlled by, the Board of
Directors.
Section 2. Number:
The number of directors which shall constitute the entire Board of Directors
shall be not less than one nor more than seven. Within these limits the actual
number constituting the entire Board shall be that fixed from time to time by
Board resolution, and until such time as the Board determines otherwise, the
number of directors shall be three. No reduction in the number of Directors
shall have the effect of removing any director prior to the expiration of his
term of office.
Section 3. Election and Term:
At the first annual Shareholder meeting and at each annual meeting thereafter
the Shareholders shall elect directors to hold office until the next succeeding
annual meeting. Each director shall hold office for the term for which he is
elected and until his successor shall have been elected and qualified or until
his earlier resignation, removal from office or death.
-5-
Section 4. Vacancy:
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 all remaining directors, even if less than a
quorum, and a director so chosen shall hold office only until the next election
of directors by the Shareholders. The Shareholders may at any time elect a
director to fill any vacancy not filled by the directors, and may elect
additional directors at a meeting at which an amendment of the By-Laws is voted
authorizing an increase in the number of directors.
Section 5. Removal:
At a meeting of Shareholders called expressly for that purpose, any director or
the entire Board 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.
Section 6. Presumption of Assent:
A director of the Corporation who is present at a meeting of its Board of
Directors at which action on any corporate matter is taken shall be presumed to
have assented to the action taken unless he votes against such action or
abstains from voting in respect thereto because of an asserted conflict of
interest.
Section 7. Quorum and Voting:
A majority of the number of directors fixed in the manner prescribed in Article
IV, Section 2 of these By-Laws shall constitute a quorum for the transaction of
business. The action of a majority of the directors present at any meeting at
which there is a quorum, when legally assembled, shall be a valid corporate
action.
Section 8. Director Conflicts of Interest:
The legal effectiveness or enforceability of any contract or other transaction
authorized by the Corporation's Board, any committee thereof or its Shareholders
which may present a conflict of interest as contemplated by the Florida Business
Corporation Act shall be determined by the provisions thereof. Directors whose
relationship with another person or entity is the source of such potential
conflict of interest may be counted in determining the presence of a quorum at a
meeting of the Board of Directors or a committee thereof which authorizes,
approves or ratifies such contract or transaction.
-6-
Section 9. Executive and Other Committees:
(a) By resolution adopted by a majority of the entire Board of Directors, there
may be designated from among its members an executive committee and other
committees each of which, to the extent provided in such resolution, shall have
and may exercise all the authority of the Board of Directors, except with
respect to those matters which by law are precluded from being delegated to a
committee.
(b) Each committee (including the members thereof) shall serve at the pleasure
of the Board and shall keep minutes and report the same to the Board. The Board
may designate one or more directors as alternate members of any committee. In
the absence or upon the disqualification of a member of a committee, if no
alternate member has been designated by the Board, the members present at any
meeting and not disqualified from voting, whether or not they constitute a
quorum, may unanimously appoint another member of the Board to act at the
meeting in the place of the absent or disqualified member.
(c) A majority of all members of a committee shall constitute a quorum for the
transaction of business, and the vote of a majority of all the members of a
committee present at a meeting at which a quorum is present shall be the act of
the committee. Each committee shall adopt whatever other rules of procedure it
determines appropriate for the conduct of its activities.
Section 10. Place of Meeting:
Meetings of the Board of Directors may be held at any location specified in the
call of the meeting or as agreed to by the directors.
Section 11. Time, Notice and Call of Meetings:
(a) Annual Meeting: Promptly following the adjournment of each annual
Shareholder meeting, the Board of Directors elected thereat shall, without
notice, convene an annual meeting and organize by the election of a Chairman who
shall preside over its further conduct.
(b) Regular Meetings: Regular meetings of the Board may be held during each
annual period in accordance with such schedule as may be agreed to by the Board
at its annual meeting. No notice need be given of such regular meetings.
-7-
(c) Special Meetings: Special meetings of the Board shall be held from time to
time upon call issued by the Chairman of the Board, any two directors, or the
President or Vice-President of the Corporation. Written notice of the time and
place of each special meeting shall be delivered personally to all directors or
sent to each by telegram or letter, charges prepaid, addressed to him at his
address shown on the records of the Corporation or as otherwise actually known
by the Secretary. If notice is mailed or telegraphed, it shall constitute
sufficient notice if it is delivered to the above address not less than 24 hours
prior to the time of the holding of the meeting.
(d) Adjournment: A majority of the directors present, whether or not a quorum
exists, may adjourn any meeting of the Board to another time and place. Notice
of the time and place of holding such adjourned meeting need not be given if
they are fixed at the meeting adjourned and while a quorum is present;
otherwise, notice shall be given to all directors in the manner directed in
subsection (c) above.
Section 12. Action Without a Meeting:
Any action required or permitted to be taken by the Board or a committee thereof
may be taken without a meeting if all members shall individually or collectively
consent in writing to such action. Such written consent shall be filed in the
minutes of the proceedings of the Board or committee and shall have the same
effect as a unanimous vote in favor of the action consented to.
ARTICLE V
Officers
Section 1. Composition and Term:
The officers of the Corporation shall consist of a President, Vice-President,
Secretary, Treasurer and such other officers with such titles, duties and powers
as may be prescribed by the Board of Directors. All officers shall be elected by
and serve at the pleasure of the Board.
Section 2. Election:
At their annual meeting the Directors shall elect officers of the Corporation,
any of whom may but need not be members of the Board. Any two or more of such
offices may be held by the same individual.
-8-
Section 3. Resignation or Removal:
Any officer may resign by giving written notice to the Board of Directors, the
President or the Secretary. Such resignation shall take effect upon receipt of
the notice, or at any later time specified therein (subject to the Board's right
of removal), and, unless otherwise specified therein, the acceptance of such
resignation shall not be necessary to make it effective.
Any officer may be removed, with or without cause, by action of a majority of
the entire Board taken at any regular or special meeting of the Board, or by
another officer upon whom such power of removal is expressly conferred by the
Board.
Section 4. Vacancy:
A vacancy in any office shall be filled by action of the Board, and its
appointee shall hold office for the unexplored term or until his successor is
elected and qualified.
Section 5. President:
The President shall be the principal executive officer of the Corporation, and,
subject to the control of the Board, shall generally supervise and control all
of the business and affairs of the Corporation. He shall preside at all meetings
of the Shareholders and, unless a Chairman of the Board of Directors has been
elected and is present, shall preside at meetings of the Board of Directors. He
shall be an ex-officio member of all committees appointed by the Board, and
shall have the general powers and duties customarily performed and exercised by
the chief executive officer of any Corporation for profit organized under the
laws of Florida, as well as such additional powers or duties as may be
prescribed by these By-Laws or the Board.
Section 6. Vice-President:
In the absence of the President or in the event of his death, inability or
refusal to act, the Vice-President shall be vested with the powers and duties of
the President. Any Vice-President may sign, with the Secretary, share
certificates issued by the Corporation; and shall perform such other duties as
from time to time may be assigned to him by the Board of Directors or President.
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Section 7. Secretary:
The Secretary shall keep, or cause to be kept, a book of minutes at the
principal office or such other place as the Board of Directors and Shareholders
may designate, a current Shareholder record book, showing the names of all
Shareholders and their addresses; and a record of all meetings conducted by the
Shareholders, Directors or Director Committees, which latter record shall
include the time and place of holding, whether regular or special, and, if
special, how authorized, the notice thereof given, the names of those present at
directors' meetings, the number of shares present or represented at
Shareholders' meetings, and the proceedings thereof.
The Secretary shall keep, or cause to be kept, at the principal office or at the
office of the Corporation's transfer agent, a Shareholder record, or a duplicate
Shareholder record, showing the names of the Shareholders and their addresses,
the number and classes of shares held by each, the number and date of
certificates issued for the same, and the number and date of cancellation of
every certificate surrendered for cancellation.
The Secretary shall give, or cause to be given, notice of all the meetings of
the Shareholders and of the Board of Directors required by the By-Laws or by law
to be given, and he shall keep the seal of the Corporation and affix said seal
to all documents requiring a seal, and shall have such other powers and perform
such other duties as may be prescribed by the Board of Directors or the By-Laws.
Section 8. Treasurer:
The Treasurer shall have custody of all corporate funds, securities, valuable
papers and financial records; shall keep full and accurate accounts of receipts
and disbursements and render accounts thereof at the annual meetings of
Shareholders and at such other times as requested by the Board or President; and
shall perform such other duties as may be prescribed by the Board or President.
Section 9. Assistant:
Any Assistant Secretary or Assistant Treasurer, respectively, may exercise any
of the powers of Secretary or Treasurer, respectively, as provided in these
By-Laws or as directed by the Board of Directors, and shall perform such other
duties as may be prescribed by the Board or President.
Section 10. Chief Executive Officer:
The Chief Executive Officer shall assist the principal executive officer of the
Corporation, and, subject to the control of the Board, shall generally supervise
and control all of the business and affairs of the Corporation. He shall preside
at -10- all meetings of the Board of Directors. He shall be an ex-officio member
of all committees appointed by the Board, and shall have the general powers and
duties customarily performed and exercised by the chief executive officer of any
Corporation for profit organized under the laws of Florida, as well as such
additional powers or duties as may be prescribed by these By-Laws or the Board.
Section 11. Chief Financial Officer:
The Chief Financial Officer shall assist and oversee all corporate funds,
securities, valuable papers and financial records; shall assure that full and
accurate accounts of receipts and disbursements are kept and accounts rendered
thereof at the annual meetings of Shareholders and at such other times as
requested by the Board or President; and shall perform such other duties as may
be prescribed by the Board or President.
ARTICLE VI
Miscellaneous
Section 1. Parliamentary Procedure:
When not in conflict with these By-Laws, Roberts Rules of Parliamentary
Procedure shall establish the rules at all Shareholder and director meetings.
Section 2. Fiscal Year:
The fiscal year of the Corporation shall be fixed, and shall be subject to
change, by the Board.
Section 3. Consent to Meeting:
The transactions approved at any meeting of Shareholders or the Board of
Directors, however called and noticed, shall be as valid as though acted upon at
a meeting duly held after regular call and notice, if a quorum is present
(either in person or by proxy in the case of a Shareholder meeting) and if,
either before or after the meeting, each of the Shareholders entitled to vote or
directors, as the case may be, not present (or represented by proxy in the case
of a Shareholder meeting) signs a written waiver of notice, or a consent to the
holding of such meeting, or an approval of the minutes thereof. All such
waivers, consents or approvals shall be filed with the corporate records or made
a part of the minutes of the meeting. Personal representatives, trustees and
other fiduciaries entitled to vote shares may sign such waivers, consents or
approvals.
Section 4. Amendment and Repeal of By-Laws:
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(a) By Shareholders: New By-Laws may be adopted or these By-Laws may be
repealed or amended at the annual or any other meeting of Shareholders called
for that purpose, by a vote of Shareholders entitled to exercise a majority of
the voting power of the Corporation, or by the written assent of such
Shareholders.
(b) By Board of Directors: Subject to the right of the Shareholders to adopt,
amend or repeal By-Laws, as provided in this section, the Board of Directors may
adopt, amend or repeal any of these By-Laws including the By-Law or amendment
thereof changing the authorized number of directors.
(c) Record of Amendments: Whenever an amendment to or repeal of any existing
By-Law is adopted, or an additional By-Law provision is approved, a replacement
page containing such new material and noting the date and manner of its adoption
shall be inserted in the original By-Laws, in the appropriate place.
