SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act
October 26, 1999
Date of Report
(Date of Earliest Event Reported)
TORBAY HOLDINGS, INC.
(Exact Name of Registrant as Specified in its Charter)
Maison Soumarez
Route de Cobo
Castel, Guernsey GY5 7RZ
United Kingdom
(Address of principal executive offices)
011 44 1481 46044
(Registrant's telephone number)
TORBAY ACQUISITION CORPORATION
1504 R Street, N.W.
Washington, D.C. 20009
(Former name and former address)
Delaware 0-25417 98-0213494
(State of other jurisdiction (Commission file (IRS Employer
of incorporation) Number) Identification no.)
ITEM 1. CHANGES IN CONTROL OF REGISTRANT
(a) Pursuant to an Agreement and Plan of Merger (the
"Merger Agreement") effective October 26, 1999 Torbay Holdings,
Inc., a Delaware corporation ("Holdings" or the "Company") acquired
all of the outstanding shares of common stock of Torbay Acquisition
Corporation ("TAC") in a transaction in which Holdings was the
surviving company.
The Merger Agreement was adopted by the unanimous consent of
the Board of Directors of TAC and approved by the unanimous consent
of the shareholders of TAC on September 27, 1999. The Merger
Agreement was adopted by the unanimous consent of the Board of
Directors of Holdings on September 27, 1999. The merger was
effected on October 26, 1999 by the filing of a certificate of
merger with the Secretary of State of Delaware.
Prior to the merger, TAC had 5,000,000 shares of common
stock outstanding. By virtue of the merger, Holdings acquired 100%
of the issued and outstanding common stock of TAC.
Prior to the merger, Holdings had an aggregate of 4,850,000
shares of common stock issued and outstanding, and 700,000 shares of
Series 1 Convertible Preferred Stock outstanding.
Each share of Series 1 Convertible Preferred Stock is
convertible into ten shares of common stock of Holdings at such time
or times, if any, that the subsidiary of Holdings, whose common
shares were acquired in exchange for the Series 1 Convertible
Preferred Stock, has returned a net profit to Holdings of $1,000,000
in any one year within five years of issuance of such Series 1
Convertible Preferred Shares. In the event that after such five
year term the Series 1 Convertible Preferred Shares have not been so
converted, each share not then converted shall be automatically
converted into one share of common stock of Holdings. Each share of
Series 1 Convertible Preferred Stock is entitled to one vote on all
matters on which such shareholders are entitled to vote and are
entitled to receive notice of or attend any annual or extraordinary
meeting of shareholders of Holdings.
Following the merger, Holdings had an aggregate of 5,100,000
shares of common stock, and 700,000 shares of Series 1 Convertible
Preferred Stock, outstanding.
Following the merger, Holdings became the successor issuer
to TAC for reporting purposes under the Securities Exchange Act of
1934, as amended. The officers, directors, and bylaws of Holdings
continued without change as the officers, directors, and bylaws of
the successor issuer. See "Management" and "Other Events" herein.
A copy of the Merger Agreement is filed as an exhibit to
this Form 8-K and is incorporated in its entirety herein. The
foregoing description is modified by such reference.
(b) The following table contains information regarding the
shareholdings of Holdings' current directors and executive officers
and those persons or entities who beneficially own more than 5% of
its common stock:
Amount of Common Percent of
Stock Beneficially Common Stock
Name Owned (1) Beneficially
Owned
Colin Peter Gervaise-Brazier 525,000 (2) 10.29%
President, Director
Francis Guy Lewis Askham 50,000 *
Vice President, Director
Alexander Gordon Lane 50,000 *
Secretary, Director
William Thomas Large 119,000 (3) 2.33%
Director
All directors and 744,000 14.59%
executive officers as
a group (4 persons)
Brewin Nominees Ltd. 350,000 6.86%
5 Giltspur Street
London EC1A 9DB
United Kingdom
Armadillo Worldwide Limited 500,000 9.80%
P.O. Box 313, Anson Court
La Route des Camps
St. Martins
Guernsey, Channel Islands
INC Limited 500,000 9.80%
c/o Trident Corporate
Services (Bahamas) Limited
1st Floor, Kings Court
Bay Street
P.O. Box N-3944
Nassau, Bahamas
Direct Trustees Limited 500,000 9.80%
P.O. Box 307
Guernsey GY1 3SH
United Kingdom
D.J. Limited 500,000 (4) 9.80%
10 Queen Street
P.O. Box HM1154
Hamilton HMEX
Bermuda
David G. Jones 750,000 (4) 14.71%
10 Queen Street
P.O. Box HM1154
Hamilton HMEX
Bermuda
Kevin W. Haddon-Harris 770,000 (4) 15.10%
48 Par La Ville Road
Hamilton, Bermuda HM11
Joanna Dorothy Gervaise-Brazier 375,000 7.35%
La Belle Epoque
Les Treacheries
L'Islet St. Sampsons
Guernsey, Channel Islands
GY2 4SN
United Kingdom
Martyn Paul Trebert 500,000 9.80%
Pleinmont, Torteaval
Guernsey, Channel Islands
GY8 0P
United Kingdom
* Less than 1% percent
(1) Based upon 5,100,000 shares outstanding following the
effectiveness of the merger.
(2) Includes 150,000 shares owned by Colin Peter
Gervaise-Brazier and 375,000 shares owned by Joanna Dorothy
Gervaise-Brazier, Mr. Gervaise-Brazier's wife.
(3) Common stock underlying Series 1 Convertible Preferred
Stock. Each share of Series 1 Convertible Preferred Stock
is convertible into ten shares of common stock of Holdings
at such time or times, if any, that the subsidiary of
Holdings, whose common shares were acquired in exchange for
the Series 1 Convertible Preferred Stock, has returned a net
profit to Holdings of $1,000,000 in any one year within five
years of issuance of such Series 1 Convertible Preferred
Shares. In the event that after such five year term the
Series 1 Convertible Preferred Shares have not been so
converted, each share not then converted shall be
automatically converted into one share of common stock of
Holdings. Includes 12,000 shares of Series 1 Convertible
Preferred Stock given by Mr. Large to his minor children.
(4) D.J. Limited is an investment partnership owned 50% each by
David G. Jones and Kevin W. Haddon-Harris. Half of D.J.
Limited's shares are allocated to Mr. Jones' beneficial
ownership and half of D.J Limited's shares are allocated to
Mr. Haddon-Harris. Mr. Haddon-Harris' ownership also
includes 20,000 shares owned by Mr. Haddon-Harris' wife.
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
(a) The consideration exchanged pursuant to the Merger
Agreement was negotiated between TAC and Holdings.
In evaluating Holdings as a candidate for the proposed
merger, TAC used criteria such as the value of the assets of
Holdings, particularly its Designer Appliances Ltd. subsidiary, its
product line, including the Telstar I and Telstar II vacuum cleaners
and the Mistral I desktop fan, other proposed products, marketing
research and experience, Holdings's current business operations and
anticipated operations, and Holdings' business name and reputation.
TAC determined that the consideration for the merger was reasonable.
In evaluating TAC as a candidate for the proposed merger,
Holdings used criteria such as TAC's status as a reporting company,
its lack of operating history and lack of potential related
liabilities. Holdings determined that the consideration for the
merger was reasonable.
(b) Holdings intends to continue developing and marketing
its products through its subsidiary Designer Appliances Ltd.
("Designer Appliances") with the further development, marketing, and
distribution of emerging products currently under development.
BUSINESS
Holdings is a development stage company that, through its
subsidiary Designer Appliances, has developed and is preparing to
market household appliances designed to be attractive to a premium,
upscale market. Holdings was incorporated on March 24, 1999 as a
Delaware corporation named Acropolis Acquisition Corporation, which
changed its name to Torbay Holdings, Inc. on July 14, 1999.
Holdings acquired control of all of the common stock of Designer
Appliances Ltd. by an Agreement and Plan of Reorganization dated as
of July 19, 1999 among Holdings, Designer Appliances and the
shareholders of Designer Appliances, who upon the effectiveness of
the reorganization, became shareholders of Holdings.
Management believes that it has identified an underexploited
opportunity in the premium-priced market for household and domestic
appliances, featuring attractively designed exteriors. There is no
assurance that Holdings will be able to successfully manufacture or
market these items.
Management believes that the Company can commence production
and sales within eight weeks after capitalization. The Company
intends to achieve capitalization via a private placement of the
Company's securities. No assurance can be made that the Company
will place any such securities or that production can be commenced.
OPERATIONS
Some 300 units of the Telstar design vacuum cleaner have been
produced for testing and marketing trials. See "Products" herein. The
Company will subcontract component manufacture and initially be
responsible for final product assembly so as to manage product quality.
Management may consider discontinuing using subcontractors to increase
profit margins at an appropriate time.
The Company will operate directly in the United Kingdom with its own
sales team. Potential distributors have been identified to expand this activity
across the European continent. Management believes that contracts may be
finalized when production and payment schedules can be predicted with
reasonable certainty. These distributors will purchase products and bear all
costs of sales and distribution in their territories. Non-critical component
supply of "off the shelf" items will be limited to preferred suppliers of
appropriate components who provide warranties and indemnities for delays
in production and shipping. Management believes that manufacturing
contracts can be finalized when production and payment schedules can be
predicted with reasonable certainty. Critical components such as product
body parts which are specific to the Company's products will be dual
sourced.
The sales objectives are in what is believed to be a niche sector of the
appliance market which addresses the most expensive end of that market.
Sales activity will be focused upon designer retail outlets such as The
Conran Shops, Harrods and Selfridges. No contracts have been entered
into to date, and there is no assurance that any contracts will be entered
into, or if entered into, that any such contracts can be maintained.
PRODUCTS
Telstar I Designer Vacuum Cleaner. A rocket shaped cylinder vacuum
cleaner made of polished aluminum and incorporating the latest in filtration
technology. It is bagless and features the High Efficiency Particle Arrester
(HEPA) medical grade filter that removes the allergens in dirt that are
associated with asthma. It has a large (50ft) cleaning radius that typically
allows for the entire floor of a modern dwelling to be cleaned without
stopping. The Telstar I will be built to British Electrical Approval Board
and German TUV standards, which relate to electrical safety and
manufacturing practices. Manufacturing costs at this time are 100 pounds
per unit and as volume impacts component purchasing this price is
anticipated to reduce to 80-85 pounds. This product is expected to sell for
150 pounds to stores and 300 pounds retail.
Telstar II Designer Vacuum Cleaner/Table. This is the Telstar I vacuum
cleaner with a glass tabletop accessory. This product is designed for an
environment in the modern city flat or home where storage space is at a
premium. The Company may choose to market this product under the name
"Sputnik" or as the "Telstar Space Station." The table top is developed to
working prototype and additional expenditure is planned on tooling and
packaging. This product is expected to sell for 100 to 125 pounds above
the cost of the Telstar I vacuum cleaner. Manufacturing cost estimates are
18 pounds for the cost of the table top.
Mistral I Desktop Fan. This is a desktop fan, cased in polished
aluminum, which utilizes the same "retro" design as the vacuum cleaner that
Designer Appliances has developed. The Mistral I fan is partially developed
and, pending financing, will be completed. Manufacturing cost estimates
are 18 pounds. This product is expected to sell for 60-70 pounds to stores
and retail for 100-125 pounds. The Mistral I fan is expected to be ready for
sale in January 2000.
Other products under development include a toaster, a kettle, space
heaters and heated hearth screens. See "Trademarks" herein.
MAJOR COMPETITORS
The Company believes that there is no cohesive product family in the
United Kingdom and Europe competing with the Company's proposed
product line in the upscale small domestic appliance sector.
Vacuum Cleaners. The Company is not aware of a competitor who
manufactures and sells a vacuum cleaner protected by this design. See
"Trademarks" herein. The Company not aware of a competitor who sells a
vacuum cleaner that converts to a piece of furniture when it is not in use.
For comparison the following table of the Company's product versus
others is provided for the Telstar I vacuum cleaner and other vacuum
cleaners.
Make Model Noise (dB) Cleaning Dirt Weight
Radius Capacity (Kgs)
(liters)
Designer
Appliances Telstar I 67/66 16 m 10 7.6
Electrolux Excellio
Electronic 74 12.5m 4 7.8
Excellio Combi 74 12.5m 4 7.3
Excellio Remote 70 12.5m 4 7.3
Bosch Perfecta 85 72 9.5m 3.2 8.7
Activa 60 75 8.5m 3.8 7.2
Hoover Alpina Filtra N/A 12.5m 4 6.9
Alpina N/A 12.5 4 6.9
Miele S 324I 73 10m 4 8
S 251 73 9.5m 4 7.9
Dyson DCO2 67 9m (est.) 4 (est.) 6.3
All data are taken from manufacturers' published marketing material.
Fans. The market in fans is diverse and is mainly made up of low-cost
plastic modeled products. There is no known dominant player in the United
Kingdom market. The design aesthetic of the Company's product is similar
to that of the Company's vacuum cleaner.
INVENTORY
If and when production and sales are commenced, the Company intends
to stock up to two months' supply of component parts and one week's
worth of finished goods. Currently, the Company has 300 of the Telstar I
vacuum cleaners that it has produced and are not currently being offered for
sale.
RAW MATERIALS
Industry standard items are available from multiple suppliers. Product
specific items are at least dual sourced. However, there can be no assurance
that an adequate supply can be maintained.
SEASONALITY
Sales periods run throughout the year, though a peak cycle of demand is
noted in the spring and autumn months, especially for vacuum cleaners.
Seasonal variations are allowed for and are not considered a critical factor
to the Company's business as this time.
PROPERTY
Holdings has identified a manufacturing facility in the South Manchester
conurbation, United Kingdom, containing approximately 2,500-5,000
square feet, which is expected to accommodate requirements in the first 6-9
months of operation. Additional facilities in the same locality have been
identified in the 4,000 to 5,000 square foot range that will be investigated
with a view to relocation by the beginning of calendar year 2000. These
facilities are anticipated to see the Company through its requirements of the
next three years. Currently, the Company has no facilities, nor any lease or
mortgage obligations with respect to any property.
PATENTS AND TRADEMARKS
The following trademark registrations or applications for registration
have been made with the British patent office. The design for the Telstar I
vacuum cleaner is protected by British registration no. 2066378. The name
"Telstar" is the subject of mark application no. 2 209 241. The name
"Sputnik" is the subject of trademark application no. 2 209 243. The table
top design for the Telstar II, Sputnik or Telstar Space Station, is the subject
of a granted registration of design no. 2082459. The trademark "Mistral"
for the table top fan is also the subject of application no. 2 209 473. The
Company is also considering a trademark registration for its toaster.
LITIGATION
None.
MARKET FOR HOLDINGS'S SECURITIES
There is currently no market for Holdings' securities.
MANAGEMENT
Name Age Title
Colin Peter Gervaise-Brazier 56 Chairman, President, Chief
Executive Officer and Director
Francis Guy Lewis Askham 68 Vice President and Director
Alexander Gordon Lane 58 Secretary and Director
William Thomas Large 44 Director
Colin Peter Gervaise-Brazier has been , Chairman, President, Chief
Executive Officer and a Director of Holdings, has served in such capacities
since September 1999. Mr. Gervaise-Brazier has been a retailing executive
in Great Britain for over 25 years. From October 1995 until September
1999, Mr. Gervaise-Brazier was General Manager of Vale Garage, Ltd., the
G.M. Vauxhall Motors franchise for the Isle of Guernsey. Mr. Gervaise-
Brazier attended Elizabeth College, Guernsey, and also attended senior
management courses at Vauxhall College, Luton, England. Since August
1999, Mr. Gervaise-Brazier has also been Chief Executive Officer and a
director of GS Telecom Ltd., an electronic retailing company whose stock
trades on the NASDAQ Bulletin Board.
Francis Guy Lewis Askham, Vice President and a Director of Holdings,
has served in such capacities since October 1999. Mr. Askham is a
Chartered Accountant and consultant, and continues in such capacities. Mr.
Askham graduated from Hurstpierpoint College, Sussex, England, and is a
Fellow of the Fellow Institute of Chartered Accountants in England and
Wales. Mr. Askham has also served as a director and chairman of Wilshaw
plc since 1991, a director and deputy chairman of Southampton Leisure
Holdings plc since January 1997, a director of GS Telecoms, Inc. since
August 1999, a director of International Energy Group plc, and was
formerly a director of Baldwin plc, M & W plc, and Rhino Group plc, all
located in Great Britain and all of whose securities trade on the London
Stock Exchange.
Alexander Gordon Lane, Secretary and a Director of Holdings, has
served in such capacities since October 1999. Mr. Lane has been a
Financial Consultant since 1998 and continues in such capacity. Mr. Lane
has been in the financial services business for over 30 years. From 1993 to
1998, he was a principal of Intercontinental Exchange Partners, New York,
as a capital markets broker in the interest and foreign exchange areas. Mr.
Lane has an aeronautics degree from Wandsworth Technical College in
London.
William Thomas Large has been a Director of Holdings since July 1999
and President of Designer Appliances since October 1998. From October
1996 until October 1998, Mr. Large was Chairman, Chief Executive
Officer, a director and a major stockholder of DeltaTheta Ltd., a heating
and cooling technology company in Cheshire, England. From February
1997 until September 1998, Mr. Large also served as a director of
DeltaMonitor Ltd, a medical devices company in Cheshire, England. From
December 1996 until June 1997, Mr. Large also served as a director or
SoundAlert Ltd, a company that manufactured emergency vehicle sirens.
From September 1994 until July 1996, Mr. Large was a director of
AromaScan plc, a publicly-listed instrumentation and technology company
in Cheshire, England. Mr. Large graduated from Manchester Metropolitan
University, in Manchester, England, and is the author or co-author of eight
articles and two books relating to biochemical analysis.
EXECUTIVE COMPENSATION
Mr. Gervaise-Brazier's salary is 60,000 pounds per year. He earns no
other remuneration from the Company or its subsidiaries.
Mr. Askham's salary is 12,000 pounds per year. He earns no other
remuneration from the Company or its subsidiaries.
Mr. Lane's salary is 12,000 pounds per year. He earns no other
remuneration from the Company or its subsidiaries.
Mr. Large's salary is 60,000 pounds per year. He is eligible for a
performance bonus of up to 100% of his base salary.
RELATED TRANSACTIONS
Pursuant to a Deed of Assignment of Intellectual Property Rights by
William Thomas Large to Designer Appliances Ltd. dated June 10, 1999,
Mr. Large assigned all of his right, title and interest in and to the design
rights to the vacuum cleaner products, toaster, fan, kettle, space heater and
heated hearth screen products now being developed by the Company. Mr.
Large's consideration for the assignment consisted of 107,000 shares of
Series 1 Convertible Preferred Stock of the Company, valued at 20,000
pounds, and 50,000 pounds in cash to be paid within six months of the date
thereof. The terms of the assignment were not the result of arms' length
negotiations.
RISK FACTORS
HOLDINGS IS CURRENTLY OPERATING AT A LOSS. Holdings has had
no sales or revenues to date. Holdings has maintained its
operations to date through the private placement of $600,000 of its
securities. Its ability to develop operations is dependent upon its
ability to advertise its products and generate sales of its
products. If Holdings is unable to sell sufficient amount of its
products at a sufficiently profitable level, it will need to raise
additional capital through the placement of its securities or from
other debt or equity financing. If the Company is not able to raise
such financing or to obtain alternative sources of funding,
management will be required to curtail operations. There is no
assurance that the Company will be able to continue to operate if a
sufficient level of sales cannot be generated.
HOLDINGS COMMENCED OPERATIONS IN 1999 AND HAS A LIMITED
OPERATING HISTORY. Holdings commenced operations in 1999 and has
only a limited history of operations which to date have not been
profitable. Its operations are subject to the risks and competition
inherent in the establishment of a relatively new business
enterprise. There can be no assurance that future operations will
be profitable. Revenues and profits, if any, will depend upon
various factors, including market acceptance of its concepts, market
awareness, dependability of its distribution network, and general
economic conditions. There is no assurance that Holdings will
achieve its expansion goals and the failure to achieve such goals
would have an adverse impact on it.
HOLDINGS IS ENTERING A COMPETITIVE FIELD. The market for
upscale household appliances is sought by numerous designers,
manufacturers, wholesalers and retailers, which may be better-known
or have a better reputation or distribution network than the
Company. There is no assurance that the Company will find suppliers
and establish a distribution network, or whether its goods will find
a market sufficient to meet its financial obligations.
HOLDINGS HAS A LIMITED ADVERTISING BUDGET. Goods aimed at a
luxury market are often marketed through the media, which charge
concurrently high advertising rates. The Company may not have the
resources available to purchase enough media exposure to find a
market for its products.
THE COMPANY IS DEPENDENT ON ITS SUPPLIERS. The Company
intends to enter into supply contracts with at least two suppliers
for each specific component of its products. However, the Company
currently has no contracts with suppliers, and even if it
establishes such contracts, there can be no assurance that supply
will be timely and meet the Company's requirements. Furthermore,
there can be no assurance that the Company's suppliers will maintain
their relationship with the Company.
THE COMPANY IS DEPENDENT ON RETAIL OUTLETS. The Company
intends to market its products through upscale department stores,
boutiques and designer outlets. However, there can be no assurance
that the Company's marketing staff will be able to persuade retail
outlets to stock the Company's products, what prominence those
outlets will choose in shelving the Company's products, or once
shelved, whether the Company's products will be given a lower
profile in the future.
THE ISSUED PREFERRED STOCK OF HOLDINGS HAS CONVERSION RIGHTS.
Holdings has designated and issued 700,000 shares of Series 1
Convertible Preferred Stock. Each share of Series 1 Convertible
Preferred Stock is convertible into ten shares of common stock of
Holdings at such time or times, if any, that the subsidiary of
Holdings, whose common shares were acquired in exchange for the
Series 1 Convertible Preferred Stock, has returned a net profit to
Holdings of $1,000,000 in any one year within five years of issuance
of such Series 1 Convertible Preferred Shares. In the event that
after such five year term the Series 1 Convertible Preferred Shares
have not been so converted, each share not then converted shall be
automatically converted into one share of common stock of Holdings.
Each share of Series 1 Convertible Preferred Stock shall be entitled
to one vote on all matters on which such shareholders may vote. In
addition, Holdings may, without further action or vote by its
shareholders, designate and issue additional series or shares of
preferred stock. The terms of the Series 1 Convertible Preferred
Stock may adversely affect the equity ownership of the holders of
the common stock and may in turn reduce the value of the common
stock.
TRADEMARK PROTECTION AND PROPRIETARY MARKS.
Notwithstanding the pending registration of certain trade names with
the British Trademark Office, there is no assurance that Holdings
will be able to enforce against use of any of its marks. There is
also no assurance that Holdings will be able to prevent competitors
from using the same or similar names, marks, concepts or appearances
or that it will have the financial resources necessary to protect
its marks against infringing use.
ISSUANCE OF FUTURE SHARES MAY DILUTE INVESTORS' SHARE VALUE.
The Certificate of Incorporation of Holdings authorizes the
issuance of 100,000,000 shares of common stock and 20,000,000 shares
of preferred stock. The future issuance of all or part of the
remaining authorized common stock may result in substantial dilution
in the percentage of the Company's common stock held by its
then-existing shareholders. Moreover, any common stock issued in
the future may be valued on an arbitrary basis by Holdings. The
issuance of the Company's shares for future services or acquisitions
or other corporate actions may have the effect of diluting the value
of the shares held by investors, and might have an adverse effect on
any trading market, should a trading market develop for the
Company's common stock.
CURRENT TRADING MARKET FOR THE COMPANY'S SECURITIES. There
is no current trading market for Holdings's common stock and there
is no assurance that one will develop. TAC had filed a registration
statement on Form 10-SB with the Securities and Exchange Commission
and has been a reporting company under the Securities Exchange Act
of 1934. Holdings has effected the merger with TAC and has become a
successor issuer thereto in order to become a reporting company
under the Securities Exchange Act of 1934, as amended. Holdings
intends to register the common stock owned by its existing
stockholders under the Securities Act of 1933, as amended, in order
to establish a trading market for its common stock on the NASD
Bulletin Board, however, no underwriter for the registration will be
retained, and no market makers have committed to becoming market
makers for the Company's common stock, and there is no assurance
that any market makers will do so. No assurance can be given that
an active trading market in the Company's securities will develop or
be sustained.
PENNY STOCK REGULATION. Upon commencement of trading in the
Company's stock, if such occurs (of which there can be no
assurance) the Company's common stock may be deemed a penny stock.
Penny stocks generally are equity securities with a price of less
than $5.00 per share other than securities registered on certain
national securities exchanges or quoted on the Nasdaq Stock Market,
provided that current price and volume information with respect to
transactions in such securities is provided by the exchange or
system. The Company's securities may be subject to "penny stock
rules" that impose additional sales practice requirements on
broker-dealers who sell such securities to persons other than
established customers and accredited investors (generally those with
assets in excess of $1,000,000 or annual income exceeding $200,000
or $300,000 together with their spouse). For transactions covered
by these rules, the broker-dealer must make a special suitability
determination for the purchase of such securities and have received
the purchaser's written consent to the transaction prior to the
purchase. Additionally, for any transaction involving a penny
stock, unless exempt, the "penny stock rules" require the delivery,
prior to the transaction, of a disclosure schedule prescribed by the
Commission relating to the penny stock market. The broker-dealer
also must disclose the commissions payable to both the broker-dealer
and the registered representative and current quotations for the
securities. Finally, monthly statements must be sent disclosing
recent price information on the limited market in penny stocks.
Consequently, the "penny stock rules" may restrict the ability of
broker-dealers to sell the Company's securities. The foregoing
required penny stock restrictions will not apply to the Company's
securities if such securities maintain a market price of $5.00 or
greater. There can be no assurance that the price of the Company's
securities will reach or maintain such a level.
COMPUTER SYSTEMS REDESIGNED FOR YEAR 2000. Many existing
computer programs use only two digits to identify a year in such
program's date field. These programs were designed and developed
without consideration of the impact of the change in the century for
which four digits will be required to accurately report the date.
If not corrected, many computer applications could fail or create
erroneous results by or following the year 2000 (the "Year 2000
problem"). Many of the computer programs containing such date
language problems have been corrected by the companies or
governments operating such programs. The Company's operations will
be dependent upon the timely delivery of supplies which deliveries
and production may be delayed or canceled because of such Year 2000
problem computer failures, and by orders and payments by its retail
outlets, which may likewise be delayed or canceled. The Company
does not know what steps, if any, will have been taken by any of its
suppliers or retail outlets in regard to the Year 2000 problems.
The Company's operations will be severally curtailed if one or more
of its suppliers or retail outlets were to suffer Year 2000
problems. Furthermore, it is impossible to predict if the basic
utilities serving the company, or its suppliers or its retail
outlets will continue uninterrupted.
ITEM 3. BANKRUPTCY OR RECEIVERSHIP
Not applicable.
ITEM 4. CHANGES IN REGISTRANT'S CERTIFYING ACCOUNTANT
Not applicable.
ITEM 5. OTHER EVENTS
SUCCESSOR ISSUER ELECTION.
Upon effectiveness of the merger, pursuant to Rule 12g-3(a) of the
General Rules and Regulations of the Securities and Exchange Commission,
Holdings became the successor issuer to TAC for reporting purposes under
the Securities Exchange Act of 1934 and elects to reports under the Act
effective Octoboer 26, 1999.
ITEM 6. RESIGNATIONS OF DIRECTORS AND EXECUTIVE OFFICERS
Not applicable.
ITEM 7. FINANCIAL STATEMENTS
No financial statements are filed herewith. The Registrant shall
file financial statements by amendment hereto not later than 60 days
after the date that this Current Report on Form 8-K is required to
be filed.
ITEM 8. CHANGE IN FISCAL YEAR
Not applicable.
EXHIBITS
2.1 Agreement and Plan of Merger between Torbay Acquisition
Corporation and Torbay Holdings, Inc.
3.1 Certificate of Incorporation of Torbay Holdings, Inc., as
amended
3.2 By-Laws of Torbay Holdings, Inc.
4.1 Certificate of Designation with respect to Series 1
Convertible Preferred Stock of Torbay Holdings, Inc.
10.1* Deed of Assignment of Intellectual Property Rights by W.
Thomas Large to Designer Appliances Ltd. dated June 10, 1999
21.1* List of Subsidiaries of Torbay Holdings, Inc.
24.1* Consent of accountants
27.1* Financial Data Schedule
* To Be Filed By Amendment
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant has duly caused this report to be signed on its
behalf by the undersigned hereunto duly authorized.
TORBAY HOLDINGS, INC.
By /s/ Colin Gervaise-Brazier
President, Chairman,
Director
Date: November 9, 1999
AGREEMENT AND PLAN OF MERGER between TORBAY ACQUISITION
CORPORATION, a Delaware corporation ("TAC"), and TORBAY HOLDINGS,
INC., a Delaware corporation ("THC"), TAC and THC being sometimes
referred to herein as the "Constituent Corporations," and each one a
"Constituent Corporation."
WHEREAS, the board of directors of each Constituent
Corporation deems it advisable that the Constituent Corporations
merge into a single corporation in a transaction intended to qualify
as a reorganization within the meaning of Section368(a)(1)(A) of the
Internal Revenue Code of 1986, as amended (the "Merger");
NOW, THEREFORE, in consideration of the premises and the
respective mutual covenants, representations and warranties herein
contained, the parties agree as follows:
1. SURVIVING CORPORATION. TAC shall be merged with and
into THC which shall be the surviving reporting corporation
(hereinafter the "Surviving Corporation") in accordance with the
applicable laws of the State of Delaware.
2. MERGER DATE. The Merger shall become effective (the
"Merger Date") upon the completion of:
2.1. Adoption of this Agreement by the board of directors
and the shareholders of TAC and by the board of directors of THC,
pursuant to the General Corporation Law of Delaware.
2.2. Execution and filing of the Certificate of Merger
with the Secretary of State of the State of Delaware in accordance
with the General Corporation Law of Delaware.
3. TIME OF FILINGS. The Certificate of Merger shall be
filed with the Secretary of State of Delaware upon the approval of
this Agreement by the shareholders of TAC and the fulfillment or
waiver of the terms and conditions herein.
4. GOVERNING LAW. The Surviving Corporation shall be
governed by the laws of the State of Delaware.
5. CERTIFICATE OF INCORPORATION. The Certificate of
Incorporation of THC shall be the Certificate of Incorporation of
the Surviving Corporation from and after the Merger Date.
6. BYLAWS. The Bylaws of the Surviving Corporation
shall be the Bylaws of THC as in effect on the date of this Agreement.
7. NAME OF SURVIVING CORPORATION. The Surviving
Corporation will continue to use its name "Torbay Holdings, Inc." or
such name as it may choose and shall be available.
8. CONVERSION. The mode of carrying the merger into
effect and the manner and basis of converting the shares of TAC into
shares of the Surviving Corporation are as follows:
8.1. The aggregate number of shares of TAC Common Stock
issued and outstanding on the Merger Date shall, by virtue of the
merger and without any action on the part of the holders thereof, be
converted into an aggregate of 250,000 shares of THC Common Stock
(which obligation has been satisfied by the prior issuance of
250,000 common shares of THC the holders of TAC Common Stock).
8.2. At September 24, 1999, there were issued and
outstanding 5,100,000 shares of Common Stock of THC and 700,000
shares of Series 1 Convertible Preferred Stock of THC.
8.3. Each share of TAC Common Stock that is issued and
outstanding and owned by TAC on the Merger Date shall, by virtue of
the merger and without any action on the part of TAC, be retired and
canceled.
8.4. Each certificate evidencing ownership of shares of
THC Common Stock issued and outstanding on the Merger Date or held
by THC in its treasury shall continue to evidence ownership of the
same number of shares of THC Common Stock.
9. UNEXCHANGED CERTIFICATES. Until surrendered, each
outstanding certificate that prior to the Merger Date represented
TAC Common Stock (other than certificates representing Dissenting
Shares) shall be deemed for all purposes, other than the payment of
dividends or other distributions, to evidence ownership of the
number of shares of THC Common Stock into which it was converted.
No dividend or other distribution payable to holders of THC Common
Stock as of any date subsequent to the Merger Date shall be paid to
the holders of outstanding certificates of TAC Common Stock;
provided, however, that upon surrender and exchange of such
outstanding certificates (other than certificates representing
Dissenting Shares), there shall be paid to the record holders of the
certificates issued in exchange therefor the amount, without
interest thereon, of dividends and other distributions that would
have been payable subsequent to the Merger Date with respect to the
shares of THC Common Stock represented thereby.
10. BOARD OF DIRECTORS AND OFFICERS. The members of the
board of directors of the Surviving Corporation shall be the members
of the board of directors of THC on the Merger Date or such others
as THC may designate. The officers of the Surviving Corporation
shall be the officers of THC on the Merger Date or such others as
THC may designate.
11. EFFECT OF THE MERGER. On the Merger Date, the
separate existence of TAC shall cease (except insofar as continued
by statute), and it shall be merged with and into the Surviving
Corporation. All the property, real, personal, and mixed, of each
of the Constituent Corporations, and all debts due to either of
them, shall be transferred to and vested in the Surviving
Corporation, without further act or deed. The Surviving Corporation
shall thenceforth be responsible and liable for all the liabilities
and obligations, including liabilities to holders of Dissenting
Shares, of each of the Constituent Corporations, and any claim or
judgment against either of the Constituent Corporations may be
enforced against the Surviving Corporation.
12. APPROVAL OF SHAREHOLDERS. This Agreement shall be
adopted by the shareholders of TAC at a meeting of such shareholders
called for that purpose or by written consent pursuant to the laws
applicable thereto. There shall be required for the adoption of
this Agreement the affirmative vote of the holders of at least a
majority of the holders of all the shares of the Common Stock issued
and outstanding and entitled to vote for TAC. Approval by the
shareholders of THC is not required by applicable law.
13. REPRESENTATIONS AND WARRANTIES OF TAC. TAC
represents and warrants that:
13.1. CORPORATE ORGANIZATION AND GOOD STANDING. TAC is a
corporation duly organized, validly existing, and in good standing
under the laws of the State of Delaware, and is qualified to do
business as a foreign corporation in each jurisdiction, if any, in
which its property or business requires such qualification.
13.2. REPORTING COMPANY. TAC has filed with the Securities
and Exchange Commission a registration statement on Form F-10 which
became effective pursuant to the Securities Exchange Act of 1934 and
is a reporting company pursuant to Section12 thereunder.
13.3. REPORTING COMPANY STATUS. TAC has timely filed and
is current on all reports required to be filed by it pursuant to
Section12(g) of the Securities Exchange Act of 1934.
13.4. CAPITALIZATION. TAC's authorized capital stock
consists of 120,000,000 shares of Common Stock, $.0001 par value, of
which 5,000,000 shares are issued and outstanding, and 20,000,000
shares of non-designated preferred stock of which no shares are
designated or issued.
13.5. ISSUANCE OF STOCK. All the outstanding shares of its
Common Stock are duly authorized and validly issued, fully paid and
non-assessable.
13.6. STOCK RIGHTS. There are no stock grants, options,
rights, warrants or other rights to purchase or obtain the TAC
Common or Preferred Stock issued or committed to be issued.
13.7. CORPORATE AUTHORITY. TAC has all requisite corporate
power and authority to own, operate and lease its properties, to
carry on its business as it is now being conducted and to execute,
deliver, perform and conclude the transactions contemplated by this
Agreement and all other agreements and instruments related to this
Agreement.
13.8. AUTHORIZATION. Execution of this Agreement has been
duly authorized and approved by TAC's board of directors.
13.9. SUBSIDIARIES. TAC has no subsidiaries.
13.10. FINANCIAL STATEMENTS. TAC's audited financial
statements dated December 31, 1998, copies of which will have been
delivered by TAC to THC prior to the Merger Date (the "TAC Financial
Statements"), fairly present the financial condition of TAC as of
the date therein and the results of its operations for the periods
then ended in conformity with generally accepted accounting
principles consistently applied.
13.11. ABSENCE OF UNDISCLOSED LIABILITIES. Except to the
extent reflected or reserved against in the TAC Financial
Statements, TAC did not have at that date any liabilities or
obligations (secured, unsecured, contingent, or otherwise) of a
nature customarily reflected in a corporate balance sheet prepared
in accordance with generally accepted accounting principles.
13.12. NO MATERIAL CHANGES. There has been no material
adverse change in the business, properties, or financial condition
of TAC since the date of the TAC Financial Statements.
13.13. LITIGATION. There is not, to the knowledge of TAC,
any pending, threatened, or existing litigation, bankruptcy,
criminal, civil, or regulatory proceeding or investigation,
threatened or contemplated against TAC or against any of its
officers.
13.14. CONTRACTS. TAC is not a party to any material
contract not in the ordinary course of business that is to be
performed in whole or in part at or after the date of this Agreement.
13.15. TITLE. TAC has good and marketable title to all the
real property and good and valid title to all other property
included in the TAC Financial Statements. Except as set out in the
balance sheet thereof, the properties of TAC are not subject to any
mortgage, encumbrance, or lien of any kind except minor encumbrances
that do not materially interfere with the use of the property in the
conduct of the business of TAC.
13.16. TAX RETURNS. All federal, state, county, municipal,
local, foreign and other taxes and assessments, including any and
all interest, penalties and additions imposed with respect to such
amounts, have been properly prepared and filed by TAC for all years
to and including the taxable year ending December 31, 1998. Any and
all federal, state, county, municipal, local, foreign and other
taxes and assessments, including any and all interest, penalties and
additions imposed with respect to such amounts for the year ending
December 31, 1998, have been paid or if any is outstanding as at the
date hereof provision has been made prorated to the date hereof to
be an adjustment to the credit of THC payable to THC on the merger
hereof. The provisions for federal and state taxes reflected in the
TAC Financial Statements are adequate to cover any such taxes that
may be assessed against TAC in respect of its business and its
operations during the periods covered by the TAC Financial
Statements and all prior periods.
13.17. NO VIOLATION. Consummation of the merger will not
constitute or result in a breach or default under any provision of
any charter, bylaw, indenture, mortgage, lease, or agreement, or any
order, judgment, decree, law, or regulation to which any property of
TAC is subject or by which TAC is bound.
14. REPRESENTATIONS AND WARRANTIES OF THC. THC
represents and warrants that:
14.1. CORPORATE ORGANIZATION AND GOOD STANDING. THC is a
corporation duly organized, validly existing, and in good standing
under the laws of the State of Delaware and is qualified to do
business as a foreign corporation in each jurisdiction, if any, in
which its property or business requires such qualification.
14.2. CAPITALIZATION. THC's authorized capital stock
consists of 100,000,000 shares of Common Stock, $.0001 par value, of
which 5,100,000 shares are issued and outstanding, and 20,000,000
shares of Preferred Stock, $.0001 par value, of which 700,000 shares
have been designated as Series 1 Convertible Preferred Stock, and
700,000 shares thereof have been issued. Each share of Series 1
Convertible Preferred Stock is convertible into ten shares of common
stock of THC at such time or times, if any, that the subsidiary of
THC, whose common shares were acquired in exchange for the Series 1
Convertible Preferred Stock, has returned a net profit to THC of
$1,000,000 in any one year within five years of issuance of such
Series 1 Convertible Preferred Shares. In the event that after such
five year term the Series 1 Convertible Preferred Shares have not
been so converted, each share not then converted shall be
automatically converted into one share of common stock of THC. Each
share of Series 1 Convertible Preferred Stock shall be entitled to
one vote on all matters on which such shareholders are lawfully
entitled to vote and shall be entitled to receive notice of or
attend any annual or extraordinary meeting of shareholders of THC.
14.3. ISSUED STOCK. All the outstanding shares of its
Common Stock and Series 1 Convertible Preferred Stock are duly
authorized and validly issued, fully paid and non-assessable.
14.4. CORPORATE AUTHORITY. THC has all requisite corporate
power and authority to own, operate and lease its properties, to
carry on its business as it is now being conducted and to execute,
deliver, perform and conclude the transactions contemplated by this
Agreement and all other agreements and instruments related to this
Agreement.
14.5. AUTHORIZATION. Execution of this Agreement has been
duly authorized and approved by THC's board of directors.
14.6. SUBSIDIARIES. THC has one subsidiary.
14.7. FINANCIAL STATEMENTS. THC's unaudited financial
statements of December 31, 1998, copies of which will have been
delivered by THC to TAC by the Merger Date (the "THC Financial
Statements"), are believed to be substantially correct and fairly
present the financial condition of THC as of the date therein and
the results of its operations for the periods then ended in
conformity with generally accepted accounting principles
consistently applied. THC shall deliver audited financial
statements to TAC within sixty (60) days after Closing, as
hereinafter defined.
14.8. ABSENCE OF UNDISCLOSED LIABILITIES. Except to the
extent reflected or reserved against in the THC Financial
Statements, THC did not have at that date any liabilities or
obligations (secured, unsecured, contingent, or otherwise) of a
nature customarily reflected in a corporate balance sheet prepared
in accordance with generally accepted accounting principles.
14.9. NO MATERIAL CHANGES. There has been no material
adverse change in the business, properties, or financial condition
of THC since the date of the THC Financial Statements.
14.10. LITIGATION. There is not, to the knowledge of THC,
any pending, threatened, or existing litigation, bankruptcy,
criminal, civil, or regulatory proceeding or investigation,
threatened or contemplated against THC or against any of its
officers.
14.11. CONTRACTS. THC is not a party to any material
contract not in the ordinary course of business that is to be
performed in whole or in part at or after the date of this Agreement.
14.12. TITLE. THC has good and marketable title to all the
real property and good and valid title to all other property
included in the THC Financial Statements. Except as set out in the
balance sheet thereof, the properties of THC are not subject to any
mortgage, encumbrance, or lien of any kind except minor encumbrances
that do not materially interfere with the use of the property in the
conduct of the business of THC.
14.13. NO VIOLATION. Consummation of the merger will not
constitute or result in a breach or default under any provision of
any charter, bylaw, indenture, mortgage, lease, or agreement, or any
order, judgment, decree, law, or regulation to which any property of
THC is subject or by which THC is bound.
15. CONDUCT OF TAC PENDING THE MERGER DATE. TAC
covenants that between the date of this Agreement and the Merger Date:
15.1. No change will be made in TAC's articles of
incorporation or bylaws.
15.2. TAC will not make any change in its authorized or
issued capital stock, declare or pay any dividend or other
distribution or issue, encumber, purchase, or otherwise acquire any
of its capital stock other than as provided herein.
15.3. TAC will submit this Agreement for its shareholders'
approval with a favorable recommendation by its board of directors
and will use its best efforts to obtain the requisite shareholder
approval.
15.4. TAC will use its best efforts to maintain and
preserve its business organization, employee relationships, and
goodwill intact, and will not enter into any material commitment
except in the ordinary course of business.
16. CONDUCT OF THC PENDING THE MERGER DATE. THC
covenants that between the date of this Agreement and the Merger Date:
16.1. No change will be made in THC's certificate of
incorporation or bylaws.
16.2. THC will not make any change in its authorized or
issued capital stock, declare or pay any dividend or other
distribution or issue, encumber, purchase, or otherwise acquire any
of its capital stock otherwise than as provided herein.
16.3. THC will submit this Agreement for approval by its
board of directors and will use its best efforts to obtain the
requisite approval.
16.4. THC will use its best efforts to maintain and
preserve its business organization, employee relationships, and
goodwill intact, and will not enter into any material commitment
except in the ordinary course of business.
17. CONDITIONS PRECEDENT TO OBLIGATION OF TAC. TAC's
obligation to consummate this merger shall be subject to fulfillment
on or before the Merger Date of each of the following conditions,
unless waived in writing by TAC:
17.1. THC'S REPRESENTATIONS AND WARRANTIES. The
representations and warranties of THC set forth herein shall be true
and correct at the Merger Date as though made at and as of that
date, except as affected by transactions contemplated hereby.
17.2. THC'S COVENANTS. THC shall have performed all
covenants required by this Agreement to be performed by it on or
before the Merger Date.
17.3. SHAREHOLDER APPROVAL. This Agreement shall have been
approved by the required number of shareholders of the Constituent
Corporations, if required by law.
17.4. SUPPORTING DOCUMENTS OF THC. THC shall have
delivered to TAC supporting documents in form and substance
satisfactory to TAC to the effect that:
(i) THC is a corporation duly organized, validly existing,
and in good standing.
(ii) THC's authorized and issued capital stock is as set
forth herein.
(iii) The execution and consummation of this Agreement have
been duly authorized and approved by THC's board of
directors.
18. CONDITIONS PRECEDENT TO OBLIGATION OF THC. THC's
obligation to consummate this merger shall be subject to fulfillment
on or before the Merger Date of each of the following conditions,
unless waived in writing by THC:
18.1. TAC'S REPRESENTATIONS AND WARRANTIES. The
representations and warranties of TAC set forth herein shall be true
and correct at the Merger Date as though made at and as of that
date, except as affected by transactions contemplated hereby.
18.2. TAC'S COVENANTS. TAC shall have performed all
covenants required by this Agreement to be performed by it on or
before the Merger Date.
18.3. SHAREHOLDER APPROVAL. This Agreement shall have been
approved by the board of directors and the required number of
shareholders of TAC.
18.4. SUPPORTING DOCUMENTS OF TAC. TAC SHALL HAVE
DELIVERED TO THC supporting documents in form and substance
satisfactory to THC to the effect that:
(i) TAC is a corporation duly organized, validly
existing, and in good standing.
(ii) TAC's authorized and issued capital stock is as set
forth herein.
(iii) The execution and consummation of this Agreement have
been duly authorized and approved by TAC's board of
directors and shareholders.
19. ACCESS. From the date hereof to the Merger Date, THC
and TAC shall provide each other with such information and permit
each other's officers and representatives such access to its
properties and books and records as the other may from time to time
reasonably request. If the merger is not consummated, all documents
received in connection with this Agreement shall be returned to the
party furnishing such documents, and all information so received
shall be treated as confidential.
20. CLOSING. The transfers and deliveries to be made
pursuant to this Agreement (the "Closing") shall be made by and take
place at the offices of the Exchange Agent or other location
designated by the Constituent Corporations without requiring the
meeting of the parties hereof. All proceedings to be taken and all
documents to be executed at the Closing shall be deemed to have been
taken, delivered and executed simultaneously, and no proceeding
shall be deemed taken nor documents deemed executed or delivered
until all have been taken, delivered and executed.
20.1. Any copy, facsimile telecommunication or other
reliable reproduction of the writing or transmission required by
this Agreement or any signature required thereon may be used in lieu
of an original writing or transmission or signature for any and all
purposes for which the original could be used, provided that such
copy, facsimile telecommunication or other reproduction shall be a
complete reproduction of the entire original writing or transmission
or original signature.
20.2. At the Closing, TAC shall deliver to the Exchange
Agent in satisfactory form, if not already delivered to THC:
(i) A list of the holders of the shares of TAC Common Stock
exchanged with an itemization of the number of shares held by each,
the address of each holder, and the aggregate number of shares of
THC Common Stock issued to each holder;
(ii) Evidence of the consent of shareholders of TAC to this
Agreement;
(iii) Certificate of the Secretary of State of Delaware as
of a recent date as to the good standing of TAC;
(iv) Certified copies of the resolutions of the board of
directors of TAC authorizing the execution of this Agreement and the
consummation of the Merger;
(v) The TAC Financial Statements;
(vi) Secretary's certificate of incumbency of the officers
and directors of TAC; and
(vii) Any document as may be specified herein or required
to satisfy the conditions, representations and warranties enumerated
elsewhere herein.
20.3. At the Closing, THC shall deliver to the Exchange
Agent in satisfactory form, if not already delivered to TAC:
(i) A list of the shareholders of record of THC, including,
wherever available, addresses and telephone numbers;
(ii) Evidence of the consent of the board of directors of
THC to this Agreement;
(iii) Certificate of the Secretary of State of Delaware as
of a recent date as to the good standing of THC;
(iv) Certified copies of the resolutions of the board of
directors of THC authorizing the execution of this Agreement and the
consummation of the merger;
(v) The THC Financial Statements;
(vi) Secretary's certificate of incumbency of the officers
and directors of THC; and
(vii) Any document as may be specified herein or required
to satisfy the conditions, representations and warranties enumerated
elsewhere herein.
21. SURVIVAL OF REPRESENTATIONS AND WARRANTIES. The
representations and warranties of the Constituent Corporations set
out herein shall survive the Merger Date.
22. ARBITRATION.
22.1. SCOPE. The parties hereby agree that any and all
claims (except only for requests for injunctive or other equitable
relief) whether existing now, in the past or in the future as to
which the parties or any affiliates may be adverse parties, and
whether arising out of this agreement or from any other cause, will
be resolved by arbitration before the American Arbitration
Association within the District of Columbia.
22.2. CONSENT TO JURISDICTION, SITUS AND JUDGEMENT. The
parties hereby irrevocably consent to the jurisdiction of the
American Arbitration Association and the situs of the arbitration
within the District of Columbia. Any award in arbitration may be
entered in any domestic or foreign court having jurisdiction over
the enforcement of such awards.
22.3. APPLICABLE LAW. The law applicable to the
arbitration and this agreement shall be that of the District of
Columbia, determined without regard to its provisions which would
otherwise apply to a question of conflict of laws.
22.4. DISCLOSURE AND DISCOVERY. The arbitrator may, in
its discretion, allow the parties to make reasonable disclosure and
discovery in regard to any matters which are the subject of the
arbitration and to compel compliance with such disclosure and
discovery order. The arbitrator may order the parties to comply
with all or any of the disclosure and discovery provisions of the
Federal Rules of Civil Procedure, as they then exist, as may be
modified by the arbitrator consistent with the desire to simplify
the conduct and minimize the expense of the arbitration.
22.5. RULES OF LAW. Regardless of any practices of
arbitration to the contrary, the arbitrator will apply the rules of
contract and other law of the jurisdiction whose law applies to the
arbitration so that the decision of the arbitrator will be, as much
as possible, the same as if the dispute had been determined by a
court of competent jurisdiction.
22.6. FINALITY AND FEES. Any award or decision by the
American Arbitration Association shall be final, binding and
non-appealable except as to errors of law or the failure of the
arbitrator to adhere to the arbitration provisions contained in this
agreement. Each party to the arbitration shall pay its own costs
and counsel fees except as specifically provided otherwise in this
agreement.
22.7. MEASURE OF DAMAGES. In any adverse action, the
parties shall restrict themselves to claims for compensatory damages
and\or securities issued or to be issued and no claims shall be made
by any party or affiliate for lost profits, punitive or multiple
damages.
22.8. COVENANT NOT TO SUE. The parties covenant that
under no conditions will any party or any affiliate file any action
against the other (except only requests for injunctive or other
equitable relief) in any forum other than before the American
Arbitration Association, and the parties agree that any such action,
if filed, shall be dismissed upon application and shall be referred
for arbitration hereunder with costs and attorney's fees to the
prevailing party.
22.9. INTENTION. It is the intention of the parties and
their affiliates that all disputes of any nature between them,
whenever arising, whether in regard to this agreement or any other
matter, from whatever cause, based on whatever law, rule or
regulation, whether statutory or common law, and however
characterized, be decided by arbitration as provided herein and that
no party or affiliate be required to litigate in any other forum any
disputes or other matters except for requests for injunctive or
equitable relief. This agreement shall be interpreted in
conformance with this stated intent of the parties and their
affiliates.
22.10. SURVIVAL. The provisions for arbitration contained
herein shall survive the termination of this agreement for any reason.
23. GENERAL PROVISIONS.
23.1. FURTHER ASSURANCES. From time to time, each party
will execute such additional instruments and take such actions as
may be reasonably required to carry out the intent and purposes of
this Agreement.
23.2. WAIVER. Any failure on the part of either party
hereto to comply with any of its obligations, agreements, or
conditions hereunder may be waived in writing by the party to whom
such compliance is owed.
23.3. BROKERS. Each party agrees to indemnify and hold
harmless the other party against any fee, loss, or expense arising
out of claims by brokers or finders employed or alleged to have been
employed by the indemnifying party.
23.4. NOTICES. All notices and other communications
hereunder shall be in writing and shall be deemed to have been given
if delivered in person or sent by prepaid first-class certified
mail, return receipt requested, or recognized commercial courier
service, as follows:
If to TAC, to:
Torbay Acquisition Corporation
1504 R Street, N.W.
Washington, D.C. 20009
If to THC, to
Torbay Holdings, Inc.
La Belle Epoque
Les Treacheries L'Islet
St Sampsons
Guernsey, CI, GY2 4SN
24. GOVERNING LAW. This Agreement shall be governed by
and construed and enforced in accordance with the laws of the State
of Delaware.
25. ASSIGNMENT. This Agreement shall inure to the
benefit of, and be binding upon, the parties hereto and their
successors and assigns; provided, however, that any assignment by
either party of its rights under this Agreement without the written
consent of the other party shall be void.
26. COUNTERPARTS. This Agreement may be executed
simultaneously in two or more counterparts, each of which shall be
deemed an original, but all of which together shall constitute one
and the same instrument. Signatures sent by facsimile transmission
shall be deemed to be evidence of the original execution thereof.
27. EXCHANGE AGENT AND CLOSING DATE. The Exchange Agent
shall be Cassidy & Associates. Closing shall take place on a date
to be agreed to by the parties.
28. EFFECTIVE DATE. This effective date of this
Agreement shall be September 27, 1999.
SIGNATURE PAGE TO AGREEMENT AND PLAN OF MERGER
BETWEEN TORBAY ACQUISITION CORPORATION AND
TORBAY HOLDINGS, INC.
IN WITNESS WHEREOF, the parties have executed this Agreement.
TORBAY ACQUISITION CORPORATION
By
TORBAY HOLDINGS, INC.
By
CERTIFICATE OF INCORPORATION
OF
ACROPOLIS ACQUISITION CORPORATION
ARTICLE ONE
Name
The name of the Corporation is Acropolis Acquisition Corporation.
ARTICLE TWO
Duration
The Corporation shall have perpetual existence.
ARTICLE THREE
Purpose
The purpose for which this Corporation is organized is to
engage in any lawful act or activity for which corporations may be
organized under the General Corporation Law of Delaware.
ARTICLE FOUR
Shares
The total number of shares of stock which the Corporation shall
have authority to issue is 120,000,000 shares, consisting of
100,000,000 shares of Common Stock having a par value of $.0001 per
share and 20,000,000 shares of Preferred Stock having a par value of
$.0001 per share.
The Board of Directors is authorized to provide for the
issuance of the shares of Preferred Stock in series and, by filing a
certificate pursuant to the applicable law of the State of Delaware,
to establish from time to time the number of shares to be included
in each such series, and to fix the designation, powers, preferences
and rights of the shares of each such series and the qualifications,
limitations or restrictions thereof.
The authority of the Board of Directors with respect to each
series of Preferred Stock shall include, but not be limited to,
determination of the following:
A. The number of shares constituting that series and the
distinctive designation of that series;
B. The dividend rate on the shares of that series, whether
dividends shall be cumulative, and, if so, from which date or dates,
and the relative rights of priority, if any, of payment of dividends
on share of that series;
C. Whether that series shall have voting rights, in addition
to the voting rights provided by law, and, if so, the terms of such
voting rights;
D. Whether that series shall have conversion privileges, and,
if so, the terms and conditions of such conversion, including
provision for adjustment of the conversion rate in such events as
the Board of Directors shall determine;
E. Whether or not the shares of that series shall be
redeemable, and, if so, the terms and conditions of such redemption,
including the date or dates upon or after which they shall be
redeemable, and the amount per share payable in case of redemption,
which amount may vary under different conditions and at different
redemption dates;
F. Whether that series shall have a sinking fund for the
redemption or purchase of shares of that series, and, if so, the
terms and amount of such sinking fund;
G. The rights of the shares of that series in the event of
voluntary or involuntary liquidation, dissolution or winding up of
the Corporation, and the relative rights of priority, if any, of
payment of shares of that series; and
H. Any other relative rights, preferences and limitations of
that series.
ARTICLE FIVE
Commencement of Business
The Corporation is authorized to commence business as soon as
its certificate of incorporation has been filed.
ARTICLE SIX
Principal Office and Registered Agent
The post office address of the initial registered office of the
Corporation and the name of its initial registered agent and its
business address is
Inc. Plan (USA)
Trolley Square
Suite 26 C
Wilmington, Delaware 19806 (County of New Castle)
The initial registered agent is a resident of the State of
Delaware.
ARTICLE SEVEN
Incorporator
Lee W. Cassidy, 1504 R Street, N.W., Washington, D.C. 20009.
ARTICLE EIGHT
Pre-Emptive Rights
No Shareholder or other person shall have any pre-emptive
rights whatsoever.
ARTICLE NINE
By-Laws
The initial by-laws shall be adopted by the Shareholders or the
Board of Directors. The power to alter, amend, or repeal the
by-laws or adopt new by-laws is vested in the Board of Directors,
subject to repeal or change by action of the Shareholders.
ARTICLE TEN
Number of Votes
Each share of Common Stock has one vote on each matter on which
the share is entitled to vote.
ARTICLE ELEVEN
Majority Votes
A majority vote of a quorum of Shareholders (consisting of the
holders of a majority of the shares entitled to vote, represented in
person or by proxy) is sufficient for any action which requires the
vote or concurrence of Shareholders, unless otherwise required or
permitted by law or the by-laws of the Corporation.
ARTICLE TWELVE
Non-Cumulative Voting
Directors shall be elected by majority vote. Cumulative voting
shall not be permitted.
ARTICLE THIRTEEN
Interested Directors, Officers and Securityholders
A. Validity. If Paragraph (B) is satisfied, no contract or
other transaction between the Corporation and any of its directors,
officers or securityholders, or any corporation or firm in which any
of them are directly or indirectly interested, shall be invalid
solely because of this relationship or because of the presence of
the director, officer or securityholder at the meeting of the Board
of Directors or committee authorizing the contract or transaction,
or his participation or vote in the meeting or authorization.
B. Disclosure, Approval, Fairness. Paragraph (A) shall apply
only if:
(1) The material facts of the relationship or interest of each
such director, officer or securityholder are known or disclosed:
(a) to the Board of Directors or the committee and it
nevertheless authorizes or ratifies the contract or transaction by a
majority of the directors present, each such interested director to
be counted in determining whether a quorum is present but not in
calculating the majority necessary to carry the vote; or
(b) to the Shareholders and they nevertheless authorize or
ratify the contract or transaction by a majority of the shares
present, each such interested person to be counted for quorum and
voting purposes; or
(2) the contract or transaction is fair to the Corporation as
of the time it is authorized or ratified by the Board of Directors,
the committee or the Shareholders.
ARTICLE FOURTEEN
Indemnification and Insurance
A. Persons. The Corporation shall indemnify, to the extent
provided in Paragraphs (B), (D) or (F) and to the extent permitted
from time to time by law:
(1) any person who is or was director, officer, agent or
employee of the Corporation, and
(2) any person who serves or served at the Corporation's
request as a director, officer, agent, employee, partner or trustee
of another corporation or of a partnership, joint venture, trust or
other enterprise.
B. Extent--Derivative Suits. In case of a suit by or in the
right of the Corporation against a person named in Paragraph (A) by
reason of his holding a position named in Paragraph (A), the
Corporation shall indemnify him, if he satisfies the standard in
Paragraph (C), for expenses (including attorney's fees but excluding
amounts paid in settlement) actually and reasonably incurred by him
in connection with the defense or settlement of the suit.
C. Standard--Derivative Suits. In case of a suit by or in the
right of the Corporation, a person named in Paragraph (A) shall be
indemnified only if:
(1) he is successful on the merits or otherwise, or
(2) he acted in good faith in the transaction which is the
subject of the suit, and in a manner he reasonably believed to be
in, or not opposed to, the best interests of the Corporation.
However, he shall not be indemnified in respect of any claim, issue
or matter as to which he has been adjudged liable for negligence or
misconduct in the performance of his duty to the Corporation unless
(and only to the extent that) the court in which the suit was
brought shall determine, upon application, that despite the
adjudication but in view of all the circumstances, he is fairly and
reasonably entitled to indemnity for such expenses as the court
shall deem proper.
D. Extent--Nonderivative Suits. In case of a suit, action or
proceeding (whether civil, criminal, administrative or
investigative), other than a suit by or in the right of the
Corporation against a person named in Paragraph (A) by reason of his
holding a position named in Paragraph (A), the Corporation shall
indemnify him, if he satisfies the standard in Paragraph (E), for
amounts actually and reasonably incurred by him in connection with
the defense or settlement of the suit as
(1) expenses (including attorneys' fees),
(2) amounts paid in settlement
(3) judgments, and
(4) fines.
E. Standard--Nonderivative Suits. In case of a nonderivative
suit, a person named in Paragraph (A) shall be indemnified only if:
(1) he is successful on the merits or otherwise, or
(2) he acted in good faith in the transaction which is the
subject of the nonderivative suit, and in a manner he reasonably
believed to be in, or not opposed to, the best interests of the
Corporation and , with respect to any criminal action or proceeding,
he had no reason to believe his conduct was unlawful. The
termination of a nonderivative suit by judgement, order, settlement,
conviction, or upon a plea of nolo contendere or its equivalent
shall not, of itself, create a presumption that the person failed to
satisfy this Paragraph (E) (2).
F. Determination That Standard Has Been Met. A determination
that the standard of Paragraph (C) or (E) has been satisfied may be
made by a court of law or equity or the determination may be made by:
(1) a majority of the directors of the Corporation (whether or
not a quorum) who were not parties to the action, suit or
proceeding, or
(2) independent legal counsel (appointed by a majority of the
directors of the Corporation, whether or not a quorum, or elected by
the Shareholders of the Corporation) in a written opinion, or
(3) the Shareholders of the Corporation.
G. Proration. Anyone making a determination under Paragraph
(F) may determine that a person has met the standard as to some
matters but not as to others, and may reasonably prorate amounts to
be indemnified.
H. Advance Payment. The Corporation may pay in advance any
expenses (including attorney's fees) which may become subject to
indemnification under paragraphs (A) - (G) if:
(1) the Board of Directors authorizes the specific payment and
(2) the person receiving the payment undertakes in writing to
repay unless it is ultimately determined that he is entitled to
indemnification by the Corporation under Paragraphs (A) - (G).
I. Nonexclusive. The indemnification provided by Paragraphs
(A) - (G) shall not be exclusive of any other rights to which a
person may be entitled by law or by by-law, agreement, vote of
Shareholders or disinterested directors, or otherwise.
J. Continuation. The indemnification and advance payment
provided by Paragraphs (A) - (H) shall continue as to a person who
has ceased to hold a position named in paragraph (A) and shall inure
to his heirs, executors and administrators.
K. Insurance. The Corporation may purchase and maintain
insurance on behalf of any person who holds or who has held any
position named in Paragraph (A) against any liability incurred by
him in any such positions or arising out of this status as such,
whether or not the Corporation would have power to indemnify him
against such liability under Paragraphs (A) - (H).
L. Reports. Indemnification payments, advance payments, and
insurance purchases and payments made under Paragraphs (A) - (K)
shall be reported in writing to the Shareholders of the Corporation
with the next notice of annual meeting, or within six months,
whichever is sooner.
M. Amendment of Article. Any changes in the General
Corporation Law of Delaware increasing, decreasing, amending,
changing or otherwise effecting the indemnification of directors,
officers, agents, or employees of the Corporation shall be
incorporated by reference in this Article as of the date of such
changes without further action by the Corporation, its Board of
Directors, of Shareholders, it being the intention of this Article
that directors, officers, agents and employees of the Corporation
shall be indemnified to the maximum degree allowed by the General
Corporation Law of the State of Delaware at all times.
ARTICLE FIFTEEN
Limitation On Director Liability
A. Scope of Limitation. No person, by virtue of being or
having been a director of the Corporation, shall have any personal
liability for monetary damages to the Corporation or any of its
Shareholders for any breach of fiduciary duty except as to the
extent provided in Paragraph (B).
B. Extent of Limitation. The limitation provided for in this
Article shall not eliminate or limit the liability of a director to
the Corporation or its Shareholders (i) for any breach of the
director's duty of loyalty to the Corporation or its Shareholders
(ii) for any acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law (iii) for any
unlawful payment of dividends or unlawful stock purchases or
redemptions in violation of Section 174 of the General Corporation
Law of Delaware or (iv) for any transaction for which the director
derived an improper personal benefit.
IN WITNESS WHEREOF, the incorporator hereunto has executed this
certificate of incorporation on this 22nd day of March, 1999.
Lee W. Cassidy, Incorporator
CERTIFICATE OF AMENDMENT
TO
ACROPOLIS ACQUISITION CORPORATION
CERTIFICATE OF INCORPORATION
JUNE 29, 1999
Acropolis Acquisition Corporation (the "Corporation"), a
corporation organized and existing under the Delaware General
Corporation Law, hereby certifies as follows:
1. As of June 28, 1999, the Corporation had 5,000,000
shares of common stock issued and outstanding.
2. By unanimous consent of the Board of Directors on June
28, 1999 and by unanimous written consent without a meeting of the
shareholder(s) dated June 28, 1999, an amendment to the Certificate
of Incorporation of the Corporation, as written below, was adopted
in accordance with Section 242 of the Delaware General Corporation
Law to effect a change of the name of the Corporation.
3. Article One to the Certificate of Incorporation
shall be amended to reflect the name change and shall be amended to
read as follows:
"Name
The name of the Corporation is Torbay Holdings, Inc."
IN WITNESS WHEREOF, I have hereunto set my hand this 30th day
of June, 1999.
) ss:
)
I, , a notary public in and for
do hereby certify that on the
day of 1999 personally
appeared before me who being by me first duly sworn, declared that
he is the person who signed the foregoing document and that the
statements therein contained are true.
__________________________
Notary Public
My Commission expires:
TORBAY HOLDINGS, INC.
BY-LAWS
ARTICLE I
The Stockholders
SECTION 1.1. ANNUAL MEETING. The annual meeting of the
stockholders of Torbay Holdings, Inc. (the "Corporation") shall be
held on the third Thursday in May of each year at 10:30 a.m. local
time, or at such other date or time as shall be designated from time
to time by the Board of Directors and stated in the notice of the
meeting, for the election of directors and for the transaction of
such other business as may come before the meeting.
SECTION 1.2. SPECIAL MEETINGS. A special meeting of the
stockholders may be called at any time by the written resolution or
request of two-thirds or more of the members of the Board of
Directors, the president, or any executive vice president and shall
be called upon the written request of the holders of two-thirds or
more in amount, of each class or series of the capital stock of the
Corporation entitled to vote at such meeting on the matters(s) that
are the subject of the proposed meeting, such written request in
each case to specify the purpose or purposes for which such meeting
shall be called, and with respect to stockholder proposals, shall
further comply with the requirements of this Article.
SECTION 1.3. NOTICE OF MEETINGS. Written notice of each
meeting of stockholders, whether annual or special, stating the
date, hour and place where it is to be held, shall be served either
personally or by mail, not less than fifteen nor more than sixty
days before the meeting, upon each stockholder of record entitled to
vote at such meeting, and to any other stockholder to whom the
giving of notice may be required by law. Notice of a special
meeting shall also state the purpose or purposes for which the
meeting is called and shall indicate that it is being issued by, or
at the direction of, the person or persons calling the meeting. If,
at any meeting, action is proposed to be taken that would, if taken,
entitle stockholders to receive payment for their stock, the notice
of such meeting shall include a statement of that purpose and to
that effect. If mailed, notice shall be deemed to be delivered when
deposited in the United States mail or with any private express mail
service, postage or delivery fee prepaid, and shall be directed to
each such stockholder at his address, as it appears on the records
of the stockholders of the Corporation, unless he shall have
previously filed with the secretary of the Corporation a written
request that notices intended for him be mailed to some other
address, in which case, it shall be mailed to the address designated
in such request.
SECTION 1.4. FIXING DATE OF RECORD. (a) In order that the
Corporation may determine the stockholders entitled to notice of or
to vote at any meeting of stockholders, or any adjournment thereof,
the Board of Directors may fix a record date, which record date
shall not precede the date upon which the resolution fixing the
record date is adopted by the Board of Directors, and which record
date shall not be more than sixty nor less than ten days before the
date of such meeting. If no record date is fixed by the Board of
Directors, the record date for determining stockholders entitled to
notice of, or to vote at, a meeting of stockholders shall be at the
close of business on the day next preceding the day on which notice
is given, or if notice is waived, at the close of business on the
day next preceding the day on which the meeting is held. A
determination of stockholders of record entitled to notice of, or to
vote at, a meeting of stockholders shall apply to any adjournment of
the meeting; provided, however, that the Board of Directors may fix
a new record date for the adjourned meeting.
(b) In order that the Corporation may determine the
stockholders entitled to consent to corporate action in writing
without a meeting (to the extent that such action by written consent
is permitted by law, the Certificate of Incorporation or these
By-Laws), the Board of Directors may fix a record date, which record
date shall not precede the date upon which the resolution fixing the
record date is adopted by the Board of Directors, and which date
shall not be more than ten days after the date upon which the
resolution fixing the record date is adopted by the Board of
Directors. If no record date has been fixed by the Board of
Directors, the record date for determining stockholders entitled to
consent to corporate action in writing without a meeting, when no
prior action by the Board of Directors is required by law, shall be
the first date on which a signed written consent setting forth the
action taken or proposed to be taken is delivered to the Corporation
by delivery to its registered office in its state of incorporation,
its principal place of business, or an officer or agent of the
Corporation having custody of the book in which proceedings of
meetings of stockholders are recorded. Delivery made to the
Corporation's registered office shall be by hand or by certified or
registered mail, return receipt requested. If no record date has
been fixed by the Board of Directors and prior action by the Board
of Directors is required by law, the record date for determining
stockholders entitled to consent to corporate action in writing
without a meeting shall be at the close of business on the day on
which the Board of Directors adopts the resolution taking such prior
action.
(c) In order that the Corporation may determine the
stockholders entitled to receive payment of any dividend or other
distribution or allotment of any rights or the stockholders entitled
to exercise any rights in respect of any change, conversion or
exchange of stock, or for the purpose of any other lawful action,
the Board of Directors may fix a record date, which record date
shall not precede the date upon which the resolution fixing the
record date is adopted, and which record date shall be not more than
sixty days prior to such action. If no record date is fixed, the
record date for determining stockholders for any such purpose shall
be at the close of business on the day on which the Board of
Directors adopts the resolution relating thereto.
SECTION 1.5. INSPECTORS. At each meeting of the stockholders,
the polls shall be opened and closed and the proxies and ballots
shall be received and be taken in charge. All questions touching on
the qualification of voters and the validity of proxies and the
acceptance or rejection of votes, shall be decided by one or more
inspectors. Such inspectors shall be appointed by the Board of
Directors before or at the meeting, or, if no such appointment shall
have been made, then by the presiding officer at the meeting. If
for any reason any of the inspectors previously appointed shall fail
to attend or refuse or be unable to serve, inspectors in place of
any so failing to attend or refusing or unable to serve shall be
appointed in like manner.
SECTION 1.6. QUORUM. At any meeting of the stockholders, the
holders of a majority of the shares entitled to vote, represented in
person or by proxy, shall constitute a quorum of the stockholders
for all purposes, unless the representation of a larger number shall
be required by law, and, in that case, the representation of the
number so required shall constitute a quorum.
If the holders of the amount of stock necessary to constitute a
quorum shall fail to attend in person or by proxy at the time and
place fixed in accordance with these By-Laws for an annual or
special meeting, a majority in interest of the stockholders present
in person or by proxy may adjourn, from time to time, without notice
other than by announcement at the meeting, until holders of the
amount of stock requisite to constitute a quorum shall attend. At
any such adjourned meeting at which a quorum shall be present, any
business may be transacted which might have been transacted at the
meeting as originally notified.
SECTION 1.7. BUSINESS. The chairman of the Board, if any, the
president, or in his absence the vice-chairman, if any, or an
executive vice president, in the order named, shall call meetings of
the stockholders to order, and shall act as chairman of such
meeting; provided, however, that the Board of Directors or executive
committee may appoint any stockholder to act as chairman of any
meeting in the absence of the chairman of the Board. The secretary
of the Corporation shall act as secretary at all meetings of the
stockholders, but in the absence of the secretary at any meeting of
the stockholders, the presiding officer may appoint any person to
act as secretary of the meeting.
SECTION 1.8. STOCKHOLDER PROPOSALS. No proposal by a
stockholder shall be presented for vote at a special or annual
meeting of stockholders unless such stockholder shall, not later
than the close of business on the fifth day following the date on
which notice of the meeting is first given to stockholders, provide
the Board of Directors or the secretary of the Corporation with
written notice of intention to present a proposal for action at the
forthcoming meeting of stockholders, which notice shall include the
name and address of such stockholder, the number of voting
securities that he holds of record and that he holds beneficially,
the text of the proposal to be presented to the meeting and a
statement in support of the proposal.
Any stockholder who was a stockholder of record on the
applicable record date may make any other proposal at an annual
meeting or special meeting of stockholders and the same may be
discussed and considered, but unless stated in writing and filed
with the Board of Directors or the secretary prior to the date set
forth herein above, such proposal shall be laid over for action at
an adjourned, special, or annual meeting of the stockholders taking
place sixty days or more thereafter. This provision shall not
prevent the consideration and approval or disapproval at the annual
meeting of reports of officers, directors, and committees, but in
connection with such reports, no new business proposed by a
stockholder, qua stockholder, shall be acted upon at such annual
meeting unless stated and filed as herein provided.
Notwithstanding any other provision of these By-Laws, the
Corporation shall be under no obligation to include any stockholder
proposal in its proxy statement materials or otherwise present any
such proposal to stockholders at a special or annual meeting of
stockholders if the Board of Directors reasonably believes the
proponents thereof have not complied with Sections 13 or 14 of the
Securities Exchange Act of 1934, as amended, and the rules and
regulations thereunder; nor shall the Corporation be required to
include any stockholder proposal not required to be included in its
proxy materials to stockholders in accordance with any such section,
rule or regulation.
SECTION 1.9. PROXIES. At all meetings of stockholders, a
stockholder entitled to vote may vote either in person or by proxy
executed in writing by the stockholder or by his duly authorized
attorney-in-fact. Such proxy shall be filed with the secretary
before or at the time of the meeting. No proxy shall be valid after
eleven months from the date of its execution, unless otherwise
provided in the proxy.
SECTION 1.10. VOTING BY BALLOT. The votes for directors, and
upon the demand of any stockholder or when required by law, the
votes upon any question before the meeting, shall be by ballot.
SECTION 1.11. VOTING LISTS. The officer who has charge of the
stock ledger of the Corporation shall prepare and make, at least ten
days before every meeting of stockholders, a complete list of the
stockholders entitled to vote at the meeting, arranged in
alphabetical order, and showing the address of each stockholder and
the number of shares of stock registered in the name of each
stockholder. Such list shall be open to the examination of any
stockholder, for any purpose germane to the meeting, during ordinary
business hours for a period of at least ten days prior to the
meeting, either at a place within the city where the meeting is to
be held, which place shall be specified in the notice of the
meeting, or if not so specified, at the place where the meeting is
to be held. The list shall also be produced and kept at the time
and place of the meeting during the whole time thereof and may be
inspected by any stockholder who is present.
SECTION 1.12. PLACE OF MEETING. The Board of Directors may
designate any place, either within or without the state of
incorporation, as the place of meeting for any annual meeting or any
special meeting called by the Board of Directors. If no designation
is made or if a special meeting is otherwise called, the place of
meeting shall be the principal office of the Corporation.
SECTION 1.13. VOTING OF STOCK OF CERTAIN HOLDERS. Shares of
capital stock of the Corporation standing in the name of another
corporation, domestic or foreign, may be voted by such officer,
agent, or proxy as the by-laws of such corporation may prescribe, or
in the absence of such provision, as the board of directors of such
corporation may determine.
Shares of capital stock of the Corporation standing in the name
of a deceased person, a minor ward or an incompetent person may be
voted by his administrator, executor, court-appointed guardian or
conservator, either in person or by proxy, without a transfer of
such stock into the name of such administrator, executor,
court-appointed guardian or conservator. Shares of capital stock of
the Corporation standing in the name of a trustee may be voted by
him, either in person or by proxy.
Shares of capital stock of the Corporation standing in the name
of a receiver may be voted, either in person or by proxy, by such
receiver, and stock held by or under the control of a receiver may
be voted by such receiver without the transfer thereof into his name
if authority to do so is contained in any appropriate order of the
court by which such receiver was appointed.
A stockholder whose stock is pledged shall be entitled to vote
such stock, either in person or by proxy, until the stock has been
transferred into the name of the pledgee, and thereafter the pledgee
shall be entitled to vote, either in person or by proxy, the stock
so transferred.
Shares of its own capital stock belonging to this Corporation
shall not be voted, directly or indirectly, at any meeting and shall
not be counted in determining the total number of outstanding stock
at any given time, but shares of its own stock held by it in a
fiduciary capacity may be voted and shall be counted in determining
the total number of outstanding stock at any given time.
ARTICLE II
Board of Directors
SECTION 2.1. GENERAL POWERS. The business, affairs, and the
property of the Corporation shall be managed and controlled by the
Board of Directors (the "Board"), and, except as otherwise expressly
provided by law, the Certificate of Incorporation or these By-Laws,
all of the powers of the Corporation shall be vested in the Board.
SECTION 2.2. NUMBER OF DIRECTORS. The number of directors
which shall constitute the whole Board shall be not fewer than one
nor more than five. Within the limits above specified, the number
of directors shall be determined by the Board of Directors pursuant
to a resolution adopted by a majority of the directors then in
office.
SECTION 2.3. ELECTION, TERM AND REMOVAL. Directors shall be
elected at the annual meeting of stockholders to succeed those
directors whose terms have expired. Each director shall hold office
for the term for which elected and until his or her successor shall
be elected and qualified. Directors need not be stockholders. A
director may be removed from office at a meeting expressly called
for that purpose by the vote of not less than a majority of the
outstanding capital stock entitled to vote at an election of directors.
SECTION 2.4. VACANCIES. Vacancies in the Board of Directors,
including vacancies resulting from an increase in the number of
directors, may be filled by the affirmative vote of a majority of
the remaining directors then in office, though less than a quorum;
except that vacancies resulting from removal from office by a vote
of the stockholders may be filled by the stockholders at the same
meeting at which such removal occurs provided that the holders of
not less than a majority of the outstanding capital stock of the
Corporation (assessed upon the basis of votes and not on the basis
of number of shares) entitled to vote for the election of directors,
voting together as a single class, shall vote for each replacement
director. All directors elected to fill vacancies shall hold office
for a term expiring at the time of the next annual meeting of
stockholders and upon election and qualification of his successor.
No decrease in the number of directors constituting the Board of
Directors shall shorten the term of an incumbent director.
SECTION 2.5. RESIGNATIONS. Any director of the Corporation
may resign at any time by giving written notice to the president or
to the secretary of the Corporation. The resignation of any
director shall take effect at the time specified therein and, unless
otherwise specified therein, the acceptance of such resignation
shall not be necessary to make it effective.
SECTION 2.6. PLACE OF MEETINGS, ETC. The Board of Directors
may hold its meetings, and may have an office and keep the books of
the Corporation (except as otherwise may be provided for by law), in
such place or places in or outside the state of incorporation as the
Board from time to time may determine.
SECTION 2.7. REGULAR MEETINGS. Regular meetings of the Board
of Directors shall be held as soon as practicable after adjournment
of the annual meeting of stockholders at such time and place as the
Board of Directors may fix. No notice shall be required for any
such regular meeting of the Board.
SECTION 2.8. SPECIAL MEETINGS. Special meetings of the Board
of Directors shall be held at places and times fixed by resolution
of the Board of Directors, or upon call of the chairman of the
Board, if any, or vice-chairman of the Board, if any, the president,
an executive vice president or two-thirds of the directors then in
office.
The secretary or officer performing the secretary's duties
shall give not less than twenty-four hours' notice by letter,
telegraph or telephone (or in person) of all special meetings of the
Board of Directors, provided that notice need not given of the
annual meeting or of regular meetings held at times and places fixed
by resolution of the Board. Meetings may be held at any time
without notice if all of the directors are present, or if those not
present waive notice in writing either before or after the meeting.
The notice of meetings of the Board need not state the purpose of
the meeting.
SECTION 2.9. PARTICIPATION BY CONFERENCE TELEPHONE. Members
of the Board of Directors of the Corporation, or any committee
thereof, may participate in a regular or special or any other
meeting of the Board or committee by means of conference telephone
or similar communications equipment by means of which all persons
participating in the meeting can hear each other, and such
participation shall constitute presence in person at such meeting.
SECTION 2.10. ACTION BY WRITTEN CONSENT. Any action required
or permitted to be taken at any meeting of the Board of Directors,
or of any committee thereof, may be taken without a meeting if prior
or subsequent to such action all the members of the Board or such
committee, as the case may be, consent thereto in writing, and the
writing or writings are filed with the minutes of the proceedings of
the Board or committee.
SECTION 2.11. QUORUM. A majority of the total number of
directors then in office shall constitute a quorum for the
transaction of business; but if at any meeting of the Board there be
less than a quorum present, a majority of those present may adjourn
the meeting from time to time.
SECTION 2.12. BUSINESS. Business shall be transacted at
meetings of the Board of Directors in such order as the Board may
determine. At all meetings of the Board of Directors, the chairman
of the Board, if any, the president, or in his absence the
vice-chairman, if any, or an executive vice president, in the order
named, shall preside.
SECTION 2.13. INTEREST OF DIRECTORS IN CONTRACTS. (a) No
contract or transaction between the Corporation and one or more of
its directors or officers, or between the Corporation and any other
corporation, partnership, association, or other organization in
which one or more of the Corporation's directors or officers, are
directors or officers, or have a financial interest, shall be void
or voidable solely for this reason, or solely because the director
or officer is present at or participates in the meeting of the Board
or committee which authorizes the contract or transaction, or solely
because his or their votes are counted for such purpose, if:
(1) The material facts as to his relationship or interest and
as to the contract or transaction are disclosed or are
known to the Board of Directors or the committee, and the
Board or committee in good faith authorizes the contract
or transaction by the affirmative votes of a majority of
the disinterested directors, even though the disinterested
directors be less than a quorum; or
(2) The material facts as to his relationship or interest and
as to the contract or transaction are disclosed or are
known to the stockholders entitled to vote thereon, and
the contract or transaction is specifically approved in
good faith by vote of the stockholders; or
(3) The contract or transaction is fair as to the Corporation
as of the time it is authorized, approved or ratified, by
the Board of Directors, a committee of the Board of
Directors or the stockholders.
(b) Interested directors may be counted in determining the
presence of a quorum at a meeting of the Board of Directors or of a
committee which authorizes the contract or transaction.
SECTION 2.14. COMPENSATION OF DIRECTORS. Each director of the
Corporation who is not a salaried officer or employee of the
Corporation, or of a subsidiary of the Corporation, shall receive
such allowances for serving as a director and such fees for
attendance at meetings of the Board of Directors or the executive
committee or any other committee appointed by the Board as the Board
may from time to time determine.
SECTION 2.15. LOANS TO OFFICERS OR EMPLOYEES. The Board of
Directors may lend money to, guarantee any obligation of, or
otherwise assist, any officer or other employee of the Corporation
or of any subsidiary, whether or not such officer or employee is
also a director of the Corporation, whenever, in the judgment of the
directors, such loan, guarantee, or assistance may reasonably be
expected to benefit the Corporation; provided, however, that any
such loan, guarantee, or other assistance given to an officer or
employee who is also a director of the Corporation must be
authorized by a majority of the entire Board of Directors. Any such
loan, guarantee, or other assistance may be made with or without
interest and may be unsecured or secured in such manner as the Board
of Directors shall approve, including, but not limited to, a pledge
of shares of the Corporation, and may be made upon such other terms
and conditions as the Board of Directors may determine.
SECTION 2.16. NOMINATION. Subject to the rights of holders of
any class or series of stock having a preference over the common
stock as to dividends or upon liquidation, nominations for the
election of directors may be made by the Board of Directors or by
any stockholder entitled to vote in the election of directors
generally. However, any stockholder entitled to vote in the
election of directors generally may nominate one or more persons for
election as directors at a meeting only if written notice of such
stockholder's intent to make such nomination or nominations has been
given, either by personal delivery or by United States mail, postage
prepaid, to the secretary of the Corporation not later than (i) with
respect to an election to be held at an annual meeting of
stockholders, the close of business on the last day of the eighth
month after the immediately preceding annual meeting of
stockholders, and (ii) with respect to an election to be held at a
special meeting of stockholders for the election of directors, the
close of business on the fifth day following the date on which
notice of such meeting is first given to stockholders. Each such
notice shall set forth: (a) the name and address of the stockholder
who intends to make the nomination and of the person or persons to
be nominated; (b) a representation that the stockholder is a holder
of record of stock of the Corporation entitled to vote at such
meeting and intends to appear in person or by proxy at the meeting
to nominate the person or persons specified in the notice; (c) a
description of all arrangements or understandings between the
stockholder 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 stockholder; (d) such other
information regarding each nominee proposed by such stockholder 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, by the
Board of Directors, and; (e) the consent of each nominee to serve as
a director of the Corporation if so elected. The presiding officer
at the meeting may refuse to acknowledge the nomination of any
person not made in compliance with the foregoing procedure.
ARTICLE III
Committees
SECTION 3.1. COMMITTEES. The Board of Directors, by
resolution adopted by a majority of the number of directors then
fixed by these By-Laws or resolution thereto, may establish such
standing or special committees of the Board as it may deem
advisable, and the members, terms, and authority of such committees
shall be set forth in the resolutions establishing such committee.
SECTION 3.2. EXECUTIVE COMMITTEE NUMBER AND TERM OF OFFICE.
The Board of Directors may, at any meeting, by majority vote of the
Board of Directors, elect from the directors an executive committee.
The executive committee shall consist of such number of members as
may be fixed from time to time by resolution of the Board of
Directors. The Board of Directors may designate a chairman of the
committee who shall preside at all meetings thereof, and the
committee shall designate a member thereof to preside in the absence
of the chairman.
SECTION 3.3. EXECUTIVE COMMITTEE POWERS. The executive
committee may, while the Board of Directors is not in session,
exercise all or any of the powers of the Board of Directors in all
cases in which specific directions shall not have been given by the
Board of Directors; except that the executive committee shall not
have the power or authority of the Board of Directors to (i) amend
the Certificate of Incorporation or the By-Laws of the Corporation,
(ii) fill vacancies on the Board of Directors, (iii) adopt an
agreement or certification of ownership, merger or consolidation,
(iv) recommend to the stockholders the sale, lease or exchange of
all or substantially all of the Corporation's property and assets,
or a dissolution of the Corporation or a revocation of a
dissolution, (v) declare a dividend, or (vi) authorize the issuance
of stock.
SECTION 3.4. EXECUTIVE COMMITTEE MEETINGS. Regular and
special meetings of the executive committee may be called and held
subject to the same requirements with respect to time, place and
notice as are specified in these By-Laws for regular and special
meetings of the Board of Directors. Special meetings of the
executive committee may be called by any member thereof. Unless
otherwise indicated in the notice thereof, any and all business may
be transacted at a special or regular meeting of the executive
meeting if a quorum is present. At any meeting at which every
member of the executive committee shall be present, in person or by
telephone, even though without any notice, any business may be
transacted. All action by the executive committee shall be reported
to the Board of Directors at its meeting next succeeding such
action.
The executive committee shall fix its own rules of procedure,
and shall meet where and as provided by such rules or by resolution
of the Board of Directors, but in every case the presence of a
majority of the total number of members of the executive committee
shall be necessary to constitute a quorum. In every case, the
affirmative vote of a quorum shall be necessary for the adoption of
any resolution.
SECTION 3.5. EXECUTIVE COMMITTEE VACANCIES. The Board of
Directors, by majority vote of the Board of Directors then in
office, shall fill vacancies in the executive committee by election
from the directors.
ARTICLE IV
The Officers
SECTION 4.1. NUMBER AND TERM OF OFFICE. The officers of the
Corporation shall consist of, as the Board of Directors may
determine and appoint from time to time, a chief executive officer,
a president, one or more executive vice-presidents, a secretary, a
treasurer, a controller, and/or such other officers as may from time
to time be elected or appointed by the Board of Directors, including
such additional vice-presidents with such designations, if any, as
may be determined by the Board of Directors and such assistant
secretaries and assistant treasurers. In addition, the Board of
Directors may elect a chairman of the Board and may also elect a
vice-chairman as officers of the Corporation. Any two or more
offices may be held by the same person. In its discretion, the
Board of Directors may leave unfilled any office except as may be
required by law.
The officers of the Corporation shall be elected or appointed
from time to time by the Board of Directors. Each officer shall
hold office until his successor shall have been duly elected or
appointed or until his death or until he shall resign or shall have
been removed by the Board of Directors.
Each of the salaried officers of the Corporation shall devote
his entire time, skill and energy to the business of the
Corporation, unless the contrary is expressly consented to by the
Board of Directors or the executive committee.
SECTION 4.2. REMOVAL. Any officer may be removed by the Board
of Directors whenever, in its judgment, the best interests of the
Corporation would be served thereby.
SECTION 4.3. THE CHAIRMAN OF THE BOARD. The chairman of the
Board, if any, shall preside at all meetings of stockholders and of
the Board of Directors and shall have such other authority and
perform such other duties as are prescribed by law, by these By-Laws
and by the Board of Directors. The Board of Directors may designate
the chairman of the Board as chief executive officer, in which case
he shall have such authority and perform such duties as are
prescribed by these By-Laws and the Board of Directors for the chief
executive officer.
SECTION 4.4. THE VICE-CHAIRMAN. The vice-chairman, if any,
shall have such authority and perform such other duties as are
prescribed by these By-Laws and by the Board of Directors. In the
absence or inability to act of the chairman of the Board and the
president, he shall preside at the meetings of the stockholders and
of the Board of Directors and shall have and exercise all of the
powers and duties of the chairman of the Board. The Board of
Directors may designate the vice-chairman as chief executive
officer, in which case he shall have such authority and perform such
duties as are prescribed by these By-Laws and the Board of Directors
for the chief executive officer.
SECTION 4.5. THE PRESIDENT. The president shall have such
authority and perform such duties as are prescribed by law, by these
By-Laws, by the Board of Directors and by the chief executive
officer (if the president is not the chief executive officer). The
president, if there is no chairman of the Board, or in the absence
or the inability to act of the chairman of the Board, shall preside
at all meetings of stockholders and of the Board of Directors.
Unless the Board of Directors designates the chairman of the Board
or the vice-chairman as chief executive officer, the president shall
be the chief executive officer, in which case he shall have such
authority and perform such duties as are prescribed by these By-Laws
and the Board of Directors for the chief executive officer.
SECTION 4.6. THE CHIEF EXECUTIVE OFFICER. Unless the Board of
Directors designates the chairman of the Board or the vice-chairman
as chief executive officer, the president shall be the chief
executive officer. The chief executive officer of the Corporation
shall have, subject to the supervision and direction of the Board of
Directors, general supervision of the business, property and affairs
of the Corporation, including the power to appoint and discharge
agents and employees, and the powers vested in him by the Board of
Directors, by law or by these By-Laws or which usually attach or
pertain to such office.
SECTION 4.7. THE EXECUTIVE VICE-PRESIDENTS. In the absence of
the chairman of the Board, if any, the president and the
vice-chairman, if any, or in the event of their inability or refusal
to act, the executive vice-president (or in the event there is more
than one executive vice-president, the executive vice-presidents in
the order designated, or in the absence of any designation, then in
the order of their election) shall perform the duties of the
chairman of the Board, of the president and of the vice-chairman,
and when so acting, shall have all the powers of and be subject to
all the restrictions upon the chairman of the Board, the president
and the vice-chairman. Any executive vice-president may sign, with
the secretary or an authorized assistant secretary, certificates for
stock of the Corporation and shall perform such other duties as from
time to time may be assigned to him by the chairman of the Board,
the president, the vice-chairman, the Board of Directors or these
By-Laws.
SECTION 4.8. THE VICE-PRESIDENTS. The vice-presidents, if
any, shall perform such duties as may be assigned to them from time
to time by the chairman of the Board, the president, the
vice-chairman, the Board of Directors, or these By-Laws.
SECTION 4.9. THE TREASURER. Subject to the direction of chief
executive officer and the Board of Directors, the treasurer shall
have charge and custody of all the funds and securities of the
Corporation; when necessary or proper he shall endorse for
collection, or cause to be endorsed, on behalf of the Corporation,
checks, notes and other obligations, and shall cause the deposit of
the same to the credit of the Corporation in such bank or banks or
depositary as the Board of Directors may designate or as the Board
of Directors by resolution may authorize; he shall sign all receipts
and vouchers for payments made to the Corporation other than routine
receipts and vouchers, the signing of which he may delegate; he
shall sign all checks made by the Corporation (provided, however,
that the Board of Directors may authorize and prescribe by
resolution the manner in which checks drawn on banks or depositories
shall be signed, including the use of facsimile signatures, and the
manner in which officers, agents or employees shall be authorized to
sign); unless otherwise provided by resolution of the Board of
Directors, he shall sign with an officer-director all bills of
exchange and promissory notes of the Corporation; whenever required
by the Board of Directors, he shall render a statement of his cash
account; he shall enter regularly full and accurate account of the
Corporation in books of the Corporation to be kept by him for that
purpose; he shall, at all reasonable times, exhibit his books and
accounts to any director of the Corporation upon application at his
office during business hours; and he shall perform all acts incident
to the position of treasurer. If required by the Board of
Directors, the treasurer shall give a bond for the faithful
discharge of his duties in such sum and with such sure ties as the
Board of Directors may require.
SECTION 4.10. THE SECRETARY. The secretary shall keep the
minutes of all meetings of the Board of Directors, the minutes of
all meetings of the stockholders and (unless otherwise directed by
the Board of Directors) the minutes of all committees, in books
provided for that purpose; he shall attend to the giving and serving
of all notices of the Corporation; he may sign with an
officer-director or any other duly authorized person, in the name of
the Corporation, all contracts authorized by the Board of Directors
or by the executive committee, and, when so ordered by the Board of
Directors or the executive committee, he shall affix the seal of the
Corporation thereto; he may sign with the president or an executive
vice-president all certificates of shares of the capital stock; he
shall have charge of the certificate books, transfer books and stock
ledgers, and such other books and papers as the Board of Directors
or the executive committee may direct, all of which shall, at all
reasonable times, be open to the examination of any director, upon
application at the secretary's office during business hours; and he
shall in general perform all the duties incident to the office of
the secretary, subject to the control of the chief executive officer
and the Board of Directors.
SECTION 4.11. THE CONTROLLER. The controller shall be the
chief accounting officer of the Corporation. Subject to the
supervision of the Board of Directors, the chief executive officer
and the treasurer, the controller shall provide for and maintain
adequate records of all assets, liabilities and transactions of the
Corporation, shall see that accurate audits of the Corporation's
affairs are currently and adequately made and shall perform such
other duties as from time to time may be assigned to him.
SECTION 4.12. THE ASSISTANT TREASURERS AND ASSISTANT
SECRETARIES. The assistant treasurers shall respectively, if
required by the Board of Directors, give bonds for the faithful
discharge of their duties in such sums and with such sureties as the
Board of Directors may determine. The assistant secretaries as
thereunto authorized by the Board of Directors may sign with the
chairman of the Board, the president, the vice-chairman or an
executive vice-president, certificates for stock of the Corporation,
the issue of which shall have been authorized by a resolution of the
Board of Directors. The assistant treasurers and assistant
secretaries, in general, shall perform such duties as shall be
assigned to them by the treasurer or the secretary, respectively, or
chief executive officer, the Board of Directors, or these By-Laws.
SECTION 4.13. SALARIES. The salaries of the officers shall be
fixed from time to time by the Board of Directors, and no officer
shall be prevented from receiving such salary by reason of the fact
that he is also a director of the Corporation.
SECTION 4.14. VOTING UPON STOCKS. Unless otherwise ordered by
the Board of Directors or by the executive committee, any officer,
director or any person or persons appointed in writing by any of
them, shall have full power and authority in behalf of the
Corporation to attend and to act and to vote at any meetings of
stockholders of any corporation in which the Corporation may hold
stock, and at any such meeting shall possess and may exercise any
and all the rights and powers incident to the ownership of such
stock, and which, as the owner thereof, the Corporation might have
possessed and exercised if present. The Board of Directors may
confer like powers upon any other person or persons.
ARTICLE V
Contracts and Loans
SECTION 5.1. CONTRACTS. The Board of Directors may authorize
any officer or officers, agent or agents, to enter into any contract
or execute and deliver any instrument in the name of and on behalf
of the Corporation, and such authority may be general or confined to
specific instances.
SECTION 5.2. LOANS. No loans shall be contracted on behalf of
the Corporation and no evidences of indebtedness shall be issued in
its name unless authorized by a resolution of the Board of
Directors. Such authority may be general or confined to specific
instances.
ARTICLE VI
Certificates for Stock and Their Transfer
SECTION 6.1. CERTIFICATES FOR STOCK. Certificates
representing stock of the Corporation shall be in such form as may
be determined by the Board of Directors. Such certificates shall be
signed by the chairman of the Board, the president, the
vice-chairman or an executive vice-president and/or by the secretary
or an authorized assistant secretary and shall be sealed with the
seal of the Corporation. The seal may be a facsimile. If a stock
certificate is countersigned (i) by a transfer agent other than the
Corporation or its employee, or (ii) by a registrar other than the
Corporation or its employee, any other signature on the certificate
may be a facsimile. In the event that any officer, transfer agent
or registrar who has signed or whose facsimile signature has been
placed upon a certificate shall have ceased to be such officer,
transfer agent, or registrar before such certificate is issued, it
may be issued by the Corporation with the same effect as if he were
such officer, transfer agent or registrar at the date of issue. All
certificates for stock shall be consecutively numbered or otherwise
identified. The name of the person to whom the shares of stock
represented thereby are issued, with the number of shares of stock
and date of issue, shall be entered on the books of the Corporation.
All certificates surrendered to the Corporation for transfer shall
be canceled and no new certificates shall be issued until the former
certificate for a like number of shares of stock shall have been
surrendered and canceled, except that, in the event of a lost,
destroyed or mutilated certificate, a new one may be issued therefor
upon such terms and indemnity to the Corporation as the Board of
Directors may prescribe.
SECTION 6.2. TRANSFERS OF STOCK. Transfers of stock of the
Corporation shall be made only on the books of the Corporation by
the holder of record thereof or by his legal representative, who
shall furnish proper evidence of authority to transfer, or by his
attorney thereunto authorized by power of attorney duly executed and
filed with the secretary of the Corporation, and on surrender for
cancellation of the certificate for such stock. The person in whose
name stock stands on the books of the Corporation shall be deemed
the owner thereof for all purposes as regards the Corporation.
ARTICLE VII
Fiscal Year
SECTION 7.1. FISCAL YEAR. The fiscal year of the Corporation
shall begin on the first day of January in each year and end on the
last day of December in each year.
ARTICLE VIII
Seal
SECTION 8.1. SEAL. The Board of Directors shall approve a
corporate seal which shall be in the form of a circle and shall have
inscribed thereon the name of the Corporation.
ARTICLE IX
Waiver of Notice
SECTION 9.1. WAIVER OF NOTICE. Whenever any notice is
required to be given under the provisions of these By-Laws or under
the provisions of the Certificate of Incorporation or under the
provisions of the corporation law of the state of incorporation,
waiver thereof in writing, signed by the person or persons entitled
to such notice, whether before or after the time stated therein,
shall be deemed equivalent to the giving of such notice. Attendance
of any person at a meeting for which any notice is required to be
given under the provisions of these By-Laws, the Certificate of
Incorporation or the corporation law of the state of incorporation
shall constitute a waiver of notice of such meeting except when the
person attends for the express purpose of objecting, at the
beginning of the meeting, to the transaction of any business because
the meeting is not lawfully called or convened.
ARTICLE X
Amendments
SECTION 10.1. AMENDMENTS. These By-Laws may be altered,
amended or repealed and new By-Laws may be adopted at any meeting of
the Board of Directors of the Corporation by the affirmative vote of
a majority of the members of the Board, or by the affirmative vote
of a majority of the outstanding capital stock of the Corporation
(assessed upon the basis of votes and not on the basis of number of
shares) entitled to vote generally in the election of directors,
voting together as a single class.
ARTICLE XI
Indemnification
SECTION 11.1. INDEMNIFICATION. The Corporation shall
indemnify its officers, directors, employees and agents to the
fullest extent permitted by the General Corporation Law of Delaware,
as amended from time to time.
[END]
CERTIFICATE OF DESIGNATION
SETTING FORTH THE PREFERENCES, RIGHTS
AND LIMITATIONS OF PREFERRED STOCK OF
TORBAY HOLDINGS, INC.
Torbay Holdings, Inc., a Delaware corporation (the
"Corporation"), certifies that pursuant to the authority contained
in Article Fourth of its Certificate of Incorporation and in
accordance with the provisions of Section 151 of the General
Corporation Law of the State of Delaware, the Corporation has the
authority to issue 20,000,000 shares of Preferred Stock, par value
$0.0001 per share; and, further
The Board of Directors of the Corporation has the authority to
issue any or all of such shares in one or more series and by
resolution to provide for the designation of each series to be
issued pursuant to the foregoing authority.
The Board of Directors has adopted the following resolution
creating a series of its preferred stock to be designated Series 1
Convertible Preferred Stock and consisting of 700,000 shares:
RESOLVED, that a series of the authorized preferred stock
entitled Series 1 Convertible Preferred Stock is hereby created with
the following designation, preferences and rights:
Designation and Amount; Par Value. The shares of such series
are designated as Series 1 Convertible Preferred Stock (the "Series
1 Preferred Stock") and the number of shares constituting such
series is 700,000. The par value of each share of the series is
$0.0001.
Conversion. Each shares of Series 1 Convertible Preferred
Stock is convertible into ten shares of common stock of the
Corporation at such time or times, if any, that the subsidiary of
the Corporation, whose common shares were acquired in exchange for
the Series 1 Convertible Preferred Stock, has returned a net profit
to the Corporation of $1,000,000 in any one year within five years
of issuance of such Series 1 Convertible Preferred Shares. In the
event that after such five year term the Series 1 Convertible
Preferred Shares have not been so converted, each share not then
converted shall be automatically converted into one share of common
stock of the Corporation.
Voting. Each share of Series 1 Convertible Preferred Stock
shall be entitled to one vote on all matters on which such
shareholders are lawfully entitled to vote and shall be entitled to
receive notice of or attend any annual or extraordinary meeting of
shareholders of the Corporation.
Dividends. The holders of the Series 1 Convertible Preferred
Shares shall not be entitled to receive dividends.
Dissolution. In the event of the liquidation, dissolution or
winding up of the Corporation or other distribution of assets of the
Corporation among its shareholders for the purpose of winding up its
affairs, whether voluntary or involuntary, the holders of the Series
1 Convertible Preferred Shares shall be entitled to receive the par
value of each share before any amount shall be paid or any property
or assets of the Corporation distributed to the holders of the
common stock. After payment in full to the holders of the Preferred
Shares, the surplus assets, if any, shall belong to and shall be
divided among the holders of other stock or shares in the
Corporation in accordance with their respective rights.
IN WITNESS WHEREOF, TORBAY HOLDINGS, INC. has caused this
Certificate of Designation to be executed by its President and
attested to by its Secretary this ______ day of _____________,
199____.
TORBAY HOLDINGS, INC.
By:
________________________________
President
ATTEST:
__________________________________
Secretary
