<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------------------------
FORM 10-SB
GENERAL FORM FOR REGISTRATION OF SECURITIES OF
SMALL BUSINESS ISSUERS
Under Section 12(b) or (g) of the Securities Exchange Act of 1934
TECHLABS, INC.
--------------
(Name of Small Business Issuer in Its Charter)
FLORIDA 65-0843965
- -------------------------------- ------------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
3415 Galt Ocean Drive
Ft. Lauderdale, FL 33308
----------------------------------------
(Address of principal executive offices)
Issuer's telephone number: (954) 630-1898
-------------------------
Securities to be registered under Section 12(b) of the Act:
Title of Each Class Name of Each Exchange on Which
to be so Registered Each Class is to be Registered
None None
Securities to be registered under Section 12(g) of the Act:
COMMON STOCK
(Title of Class)
<PAGE> 2
PART I
Item 1. Business
Forward-looking Statements
This Registration Statement includes forward-looking statements within
the meaning of Section 21E of the Securities Exchange Act of 1934 (the "Exchange
Act"). These statements are based on management's beliefs and assumptions and on
information currently available to management. Forward-looking statements
include statements in which words such as "expect," "anticipate," "intend,"
"plan," "believe," "estimate," "consider," or similar expressions are used.
Forward-looking statements are not guarantees of future performance.
They involve risks, uncertainties and assumptions. The Company's future results
and stockholder values may differ materially from those expressed in these
forward-looking statements. Many of the factors that will determine these
results and values are beyond the Company's ability to control or predict. In
addition, the Company does not have any intention or obligation to update
forward-looking statements after the effectiveness of this Registration
Statement, even if new information, future events or other circumstances have
made them incorrect or misleading. For these statements, the Company claims the
protection of the safe harbor for forward-looking statements contained in
Section 21E of the Exchange Act.
History
TECHLABS, INC. ("Techlabs" or "Company") is a Florida corporation
organized in May, 1998 as Coordinated Physician Services, Inc. to organize and
operate primary care physician networks for managed medical care organizations.
In February 1999 we abandoned this business due to excessive competition and
changed our name to Techlabs, Inc. and embarked on a strategy to develop and
operate Internet related business operations directly and through subsidiaries
and strategic alliances.
The Company's principal office is located at 3415 Galt Ocean Drive, Ft.
Lauderdale, Florida 33308, and its telephone number is (954)630-1898. We are
currently in the developmental stage.
Business Opportunities on the Internet
We believe that Internet related businesses will benefit from the
increasing number of Internet users and that advertisers will more likely choose
to advertise on Web sites that demonstrate a high volume of user traffic and
provide content designed for specific demographic groups. The Company believes
that opportunities for providers of business and finance, sports and Internet-
related content in reaching certain niches of the Internet user community will
parallel opportunities for those offering complementary technologies such as
search/index guides and portals like the Internet Sleuth.
<PAGE> 3
The Company expects that the Internet market for advertising will
continue to grow in the foreseeable future. According to Jupiter Communications,
the market for Internet-based advertising and sponsorships amounted to only
about $55 million in 1995. According to the Internet Advertising Bureau, by
1997, advertising reached $900 million and is expected to grow to approximately
$4 billion by the year 2000. Because of the diversification in user groups, the
focus of Internet advertising is no longer geared toward computer-based or
Internet related products. The mushrooming of Internet advertising reflects this
greater diversity of products and target audience. According to a Coopers &
Lybrand spokesman, "[1997] is the year the Internet has come into its own . . .
We are witnessing the evolution of the Internet into a vitally important
consumer advertising medium . . ." Portals, which now attract 15% of Internet
page-views, receive 59% of Internet advertising, according to Ziff Davis
Publishing's ZDNet News. This share of Internet traffic is projected to reach
20% and 30% of advertising dollars by 2002.
Projections of growth in Internet commerce consider that a primary
impetus will derive from a greater participation from foreign economies.
According to Robert Hult, vice president and general manager of Alta Vista,
"The international market will be 50 percent of the total traffic on the
Internet in a few years." Yahoo! President and CEO, Tim Koogle reports that 40%
of its page-views come from outside North America, up from 20% two years ago. We
believe that license agreements and partnerships within foreign companies may
present important opportunities as the Internet continues to expand globally.
We believe that an important factor in the recognition of the World
Wide Web as a legitimate advertising medium is the ability to direct advertising
to specific user groups, directly distribute targeted information to users on an
individualized basis and receive timely feedback from users. Current technology
allows Web sites to monitor the demographics of their users and deliver specific
information to the advertisers and advertising agencies. The Company believes
that continued improvements in the tools and technologies used to measure user
response to advertisements on the Internet and to track purchasing decisions
should increase the effectiveness and attractiveness of Internet-based
advertising. The emerging model for advertising rates recognizes that
advertisers are willing to pay a premium for the targeted audience that the
internet can deliver. The Internet can also provide the user with direct access
to the advertiser with "click-through" advertisements, where an electronic
transaction is capable of occurring immediately if the advertiser has a Web site
capable of conducting sales and purchases via the Internet. Another perceived
advantage of Internet-based advertising is that such advertising can be
evaluated and monitored daily, and in the future should be capable of being
monitored in real-time. If an Internet-based advertisement is not delivering the
anticipated results, an advertiser can remove the advertisement within a short
period of time and replace it with an advertisement that may be more likely to
deliver the anticipated results.
We believe that the growth of the Internet and its adaptation to
commercial use presents a significant new opportunity for merchants to reach a
wider customer base. We are beginning to see the growth curve as consumers,
merchants and financial institutions have become satisfied that the electronic
manifestations of existing payment methods are as safe, convenient and secure as
their current counterparts.
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<PAGE> 4
Recent Transaction
On April 27, 1999, the Company negotiated the acquisition and redemption of an
aggregate of 1,000,000 shares of the preferred stock of The BigHub.com formerly
named Sleuth.com, Inc., (OTC Bulletin Board Trading Symbol: BHUB) in exchange
for $600,000, 250,000 shares of the restricted common stock of Techlabs, and an
agreement between the Company and The BigHub.com with respect to the future
joint development and marketing of new Internet sites and related businesses.
Item 2. Plan of Operation.
We intend to develop and operate Internet related business ventures
including specialized content providers.
The Company intends to adopt a strategy of seeking opportunities to
realize significant gains through the selective sale of interests in our
Internet ventures or having separate subsidiaries or affiliates sell minority
interest to outside investors. The Company believes that this strategy will
provide the ability to significantly increase shareholder value as well as
provide capital to support the growth in the Company's operations.
We hope to become a significant service provider within each respective
market niche for specialized content which we enter. The critical success
factors are: understanding, developing and applying information technology to
the Internet, interactive media markets, and data access and software tools;
narrowing market focus while consummating strategic alliances to complement
product and service offerings; investing in strategic Internet or interactive
media investments or acquisitions and most importantly, a continued
understanding of customers' needs.
We will seek to participate in the Internet interactive media
industries and develop market share. Key elements of this strategy include:
1. The Company intends to devote significant resources into
operations which seek to capitalize on opportunities surrounding the growth of
the Internet and the interactive marketing industry. The Company intends to
pursue the growth and development of Internet related technologies and services
and introduce such services and products commercially. Additionally, the Company
intends to continue to evaluate new opportunities to further its Internet
strategy and also to seek out opportunities to realize significant shareholder
value through the sale of selected operations or technologies or having separate
subsidiaries sell a minority interest to outsiders.
2. We intend to attend numerous trade shows in the Internet, high
technology, direct marketing, mutual fund, book, and library markets, while
further supplementing its sales efforts with space advertising and product and
services listings in appropriate directories. In addition, the
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<PAGE> 5
Company will sponsor user group meetings for its mutual fund clients and major
lists participants in the InfoBuyers List database, where new products and
services are highlighted.
3. We intend to conduct numerous mailing of list catalogs,
flyers, newsletters and other product information throughout the year to
primarily book, magazine, journal, newsletter and software publishers and
resellers, seminar companies, professional associations, business supply
catalogers, consumer electronic, high technology and financial service
organizations.
4. The Company intends to develop and market a variety of
Internet related products and services, as well as a number of database software
technologies. These industries are characterized by rapid technological
development. The Company believes that its future success will depend in large
part on its ability to continue to enhance its proposed products and services
and to develop other products and services which complement existing ones. In
order to respond to rapidly changing competitive and technological conditions,
the Company expects to continue to incur significant research and development
expenses during the initial development phase of new products and services as
well as on an ongoing basis.
Risk Factors
We are still in the development stage. We have not yet developed and do
not operate any Internet-related business. There can be no assurance that we
will successfully enter the Internet business.
Need for additional working capital.
We may require additional working capital to support any
Internet-related operations we develop.
Government Regulations
Although there are currently few laws and regulations directly
applicable to the Internet, it is possible that new laws and regulations will be
adopted covering issues such as, among other things, privacy, copyrights,
access, obscene or indecent communications and the pricing, characteristics and
quality of Internet products and services. The Communications Decency Act or
other legislation could dampen the growth of the Internet generally and decrease
the acceptance of the Internet as an advertising medium, and could, thereby,
have a material adverse effect on the Company's business, financial condition
and operating results.
Competition
We believe that competition represents the greatest risk to our
proposed Plan of Operation. The Internet has attracted a large number of
business attention from established companies who are seeking to expand into the
Internet as well as newer Internet businesses such as Amazon and Yahoo.
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<PAGE> 6
There can be no assurance that we will be successful in establishing meaningful
or profitable operations in any area. Although there is great opportunity in the
Internet, there is little barrier to entry by competitors.
Year 2000 Computer Problem
Our current operations are not subject to the Year 2000 computer
problem. We will take reasonable efforts to assure that future operations will
not be adversely affected by the Year 2000 computer problem. There can be no
assurance that entities with which we do business will not be effected by the
Year 2000 computer problem.
Item 3. Description of Property
The Company does not own or lease any real property. Use of its
executive office is provided by its President at no charge to the Company.
Item 4. Security Ownership of Certain Beneficial Owners and Management
The following table sets forth information as of the date hereof with
respect to the beneficial ownership of our voting securities by (i) each person
known by the Company to own beneficial 5% or more of our voting securities (ii)
each director and officer of the Company and (iii) all directors and officers as
a group. The number of shares of Common Stock owned are those "beneficially
owned" as determined under the rules of the Securities and Exchange Commission,
Including any shares of Common Stock as to which a person has sole or shared
voting or investment power and any shares of Common Stock which the person has
the right to acquire within 60 days through the exercise of any option, warrant
or right.
<TABLE>
<CAPTION>
Common Stock
- ------------
Number of Percent of
Name and Address of Beneficial Owner Shares Owned Class Owned
- ------------------------------------ ------------ -----------
<S> <C> <C>
Thomas J. Taule 750,000 11%
c/o Techlabs, Inc.
3415 Galt Ocean Drive
Ft. Lauderdale, Florida 33308
Blue Sky Investment Group, Inc. 1,000,000 14.6%
3389 Sheridan Street
Hollywood, Florida 33021
</TABLE>
-5-
<PAGE> 7
<TABLE>
<CAPTION>
Number of Percent of
Name and Address of Beneficial Owner Shares Owned Class Owned
- ------------------------------------ ------------ -----------
<S> <C> <C>
Nomad Investment Group, Inc. 833,334 12.2%
3116 N. Federal Hwy.
Lighthouse Point, Florida 33064
Reveal Online Information, Inc. 833,333 12.2%
1003 S.E. 17th Street
Fort Lauderdale, Florida 33315
Strategic Holdings, Inc. 833,333 12.2%
16 Port Side Lane
Fort Lauderdale, Florida 33064
Mayjay Holdings, Inc. 750,000 11%
1570 Madruga Avenue
Suite 211
Coral Gables, FL 33146
Upside Investments, Inc. 750,000 11%
1570 Madruga Avenue
Suite 211
Coral Gables, FL 33146
Hollywood, Florida 33021
Yucatan Holdings Company 750,000 11%
3003 Keller Blvd. Rd
Knoxville, TN 37922
All Directors and Officers as a Group
(Two (2) persons) 750,000 11%
CLASS A SPECIAL PREFERRED STOCK
Thomas J. Taule 4,500,000 50%
c/o Techlabs, Inc.
3415 Galt Ocean Drive
Ft. Lauderdale, Florida 33308
Yucatan Holdings Company 4,500,000 50%
3003 Keller Blvd. Rd
Knoxville, TN 37922
</TABLE>
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<PAGE> 8
Item 5. Directors and Executive Officers.
The following table sets forth the name, age and position of each
director and executive officer of the Company as of the date hereof.
<TABLE>
<CAPTION>
NAME AGE POSITION
- ---- --- --------
<S> <C> <C>
Thomas J. Taule 29 Chairman, Secretary, Treasurer and Director
John J. Bennett 38 President and Director
</TABLE>
JOHN J. BENNETT
Mr. Bennett, President and Director of Techlabs since May 17, 1999, possesses an
extensive background in the Internet services industry, with a particular
emphasis on site design and development, operation and e-commerce. While serving
as CEO and President of TheBigHub.com (formerly iSleuth.com. Inc.) from August
1998 through May 1999, he successfully guided the transformation of that
company's "Internet Sleuth" search engine site (http://www.isleuth.com) from its
origins as a non-commercial web search site into that of a premier Internet
gateway portal site offering a variety of features and services. During the
course of his tenure, he directed the introduction of a wide range of new site
services, including shopping and e-commerce, free e-mail, and in-depth news,
weather, financial, business and investment information. Mr. Bennett also
developed and implemented a variety of innovative traffic building programs for
the isleuth.com site which resulted in an increase in the site's user base over
a nine month period from approximately 300,000 unique users to well over
1,200,000. Since May 1994, Mr. Bennett has also served as President of Direct
Digital Communications, an Internet-based marketing and Web site development
company that specializes in working with Web site owners and operators to build
traffic and revenues through the development of site sponsorships, advertising
programs and partnership arrangements.
THOMAS J. TAULE
Thomas J. Taule, Chairman, Secretary, Treasurer and Director of Techlabs, Inc.
since May 1998, was Executive Vice President of operations of TheBigHub.com
(formerly iSleuth.com. Inc.) from August 1998 to May 1999, where he directed the
successful transformation of the Company from it's origins as a physician
practice management business to that of an Internet site owner and operator. Mr.
Taule was chiefly responsible for development and adoption of the new business
plan which guided that transformation, as well as the acquisition of the
Internet Sleuth search engine and web site that formed the backbone of its
Internet operations. From February 1994 to August 1998 Mr. Taule served as
Chairman of the Board, President and CEO of Coordinated HealthCare, Inc., the
predecessor of thebighub.com/isleuth.com and was also a founder of the Company.
-7-
<PAGE> 9
Item 6. Executive Compensation
The Company has not paid any compensation to its current officers and
directors. The Company expects to pay reasonable compensation at such time as
the Company s business develops to such extent that it is able to do so. The
Company does not have any incentive or stock option plans and does not have any
employment agreements.
Item 7. Certain Relationships and Related Transactions
None.
Item 8. Description of Securities
COMMON STOCK
The Company's authorized capital consists of 50,000,000 shares of
Common Stock, par value $.001 per share. Holders of shares of Common Stock are
entitled to one vote per share at all meetings of stockholders. In the event of
liquidation, dissolution or winding up of the Company, holder of the Common
Stock will be entitled to receive on a pro rata basis 99% of assets of the
Company remaining after satisfaction of all liabilities and payment of any
preferred liquidation rights with liquidation preference.
PREFERRED STOCK
The Articles of Incorporation as amended, authorize the issuance of the
following Preferred Stock:
<TABLE>
<CAPTION>
<S> <C>
10,000,000 shares of Preferred Stock $.001 par value per share
25,000,000 shares of Special Preferred Stock $.001 par value per share
</TABLE>
12,500,000 shares of the Special Preferred Stock have been designated
Class A Special Preferred Stock. The shares of Special Preferred Stock which are
not Class A Special Preferred Stock may be issued, with a majority of
shareholder approval, with designations, powers, preferences and relative rights
determined by the Board of Directors.
VOTING RIGHTS
Preferred Stock - Each share of Preferred Stock is entitled to one vote
per share.
Special Preferred Stock - The voting rights of the Special Preferred
Stock is to be determined at the time of issuance.
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<PAGE> 10
Class A Special Preferred Stock - Three votes per share. Votes as a
single class with the Common Stock and Preferred Stock.
LIQUIDATION RIGHTS
Preferred Stock - Has the right to receive 1% of the assets of the
corporation available to the shareholders upon liquidation with the holders of
the common stock receiving the other 99%.
Special Preferred Stock - Liquidation rights to be determined upon
issuance. May have priority over liquidation payments to common stock and other
series of preferred stock.
Class A Special Preferred Stock - does not share in proceeds upon
liquidation.
REDEMPTION
Preferred Stock - At the option of the company, may be redeemed for one
share of common stock.
Special Preferred Stock - Redemption to be determined at time of
issuance.
Class A Special Preferred Stock - Manner of redemption, redemption
price and terms and conditions to be determined by the Board of Directors.
PART II
Item 1. Market Price of and Dividends on the Registrant's Common Equity and
Related Stockholder Matters
Our Common Stock has been trading on the over-the-counter market
since January 4, 1999. The following sets forth the range of high and low bid
quotations for the periods indicated as reported by National Quotation Bureau,
Inc. Such quotations reflect prices between dealers without retail mark-up,
markdown or commission and may not represent actual transactions and is quoted
on the OTC Bulletin Board under the symbol TKLB.
<TABLE>
<CAPTION>
High Bid Low Bid
-------- -------
<S> <C> <C>
January 5, 1999 through March 31, 1999 $1.50 $.50
</TABLE>
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<PAGE> 11
HOLDERS OF RECORD
As of May 15, 1999, there were approximately 38 holders of record of
the Company's Common Stock.
The Company has never paid a cash dividend on its Common Stock nor does
the Company anticipate paying cash dividends on its Common Stock in the near
future. It is the present policy of the Company not to pay cash dividends on the
Common Stock but to retain earnings, if any, to fund growth and expansion. Any
payment of cash dividends of the Common Stock in the future will be dependent
upon the Company's financial condition, results of operations, current and
anticipated cash requirements, plan for expansion, as well as other factors the
Board of Directors deems relevant.
Item 2. Legal Proceedings
As of the date hereof, the Company is not a party to any material
pending legal proceeding and is not aware of any threatened legal proceeding.
Item 3. Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure
None.
Item 4. Recent Sales of Unregistered Securities
The following provides information concerning all sales of securities
within the last three (3) years which were not registered under the Securities
and Exchange Act of 1933:
1. In May 1998, the Company issued 1,000,000 shares of its Common Stick
to its founders for par value of $.001 per share pursuant to an exemption from
registration under Section 4(2) of the Securities and Exchange Act of 1933.
2. In August 1998, the Company completed a private placement of its
Common Stock to 32 investors pursuant to Rule 504 of Regulation D. as
promulgated by the Securities and Exchange Commission under the Securities Act.
The Company issued 100,000 shares of its Common Stock at $.25 per share.
3. In March 1999, the Company completed a private placement of its
Common Stock to 4 investors pursuant to Rule 504 of Regulation D as promulgated
by the Securities and Exchange Commission under the Securities Act. The Company
issued 1,500,000 shares of its Common Stock at $.10 per share and an option to
acquire 3,500,000 shares of Common Stock for $.10 per share. These options were
exercised in April 1999 and the Company issued 3,500,000 shares of Common Stock
for $.10 per share to 6 investors.
-10-
<PAGE> 12
4. In March 1999, 1,000,000 shares of Common Stock issued to founders
in May 1998 were converted into 9,000,000 shares of Class A Special Preferred
Stock pursuant to an exemption from registration under Section 3(a)(9) of the
Securities and Exchange Act of 1933.
5. In April 1999, the Company completed a Private Placement of 230,000
shares of Common Stock to 3 investors for $230,000 pursuant to Rule 504 of
Regulation D for $1.00 per share.
Item 5. Indemnification of Directors and Officers
The Company's Certificate of Incorporation, as amended, provides that
the Company must, to the fullest extent permitted by the General Corporation Law
of the States of Florida, indemnify all persons whom it has the power to
indemnify from and against all expenses, liabilities or other matters. The
Company's By-laws further provide that the Company must indemnify its directors,
officers, employees and agents to the fullest extent permitted by the Florida
Law and provides for the advancement of expenses incurred by such person in
advance of final disposition of any civil or criminal action, suit or
proceeding, subject to repayment if it is ultimately determined that he or she
was not entitled to indemnification. The indemnification and advancement of
expenses provided in the By-laws are expressly deemed to not be exclusive of any
other rights to which a person seeking indemnification or advancement of
expenses may otherwise be entitled.
PART F/S
The following financial statements of Techlabs, Inc. are included in this Part
F/S.
For the period May 26, 1998 (inception) through December 31, 1998:
Report of Independent Auditors.
Balance Sheet as of December 31, 1998.
Statements of Operations for the period from May 26, 1998 (inception)
to December 31, 1998.
Statements of Shareholders' Equity for the period from May 26, 1998
(inception) to December 31, 1998.
Statements of Cash Flows for the period from May 26, 1998 (inception)
to December 31, 1998.
For the quarter ended March 31, 1999 (unaudited):
Accountants' Compilation Report
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<PAGE> 13
Balance Sheet as of March 31, 1999.
Statements of Operations for the three months ended March 31, 1999 and
from inception (May 26, 1999) through March 31, 1999.
Statements of Changes in Stockholder's Equity for the period from May
26, 1998 (inception) through March 31, 1999.
Notes to Financial Statements.
PART III
Item 1. Exhibits
<TABLE>
<CAPTION>
Exhibit No. Description
- ----------- -----------
<S> <C>
2(a) Articles of Incorporation of the Registrant
2(b) Articles of Amendment to Articles of
Incorporation (Composite)
2(c) By-Laws of the Registrant
6(a) Agreement for shares of iSleuth.Com, Inc.
22 Subsidiaries
27 Financial Data Schedule (for SEC use only)
</TABLE>
SIGNATURES
In accordance with Section 12 of the Exchange Act of 1934, the
registrant caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized this 26th day of May, 1999.
TECHLABS, INC.
By: /s/Thomas J. Taule
--------------------------------------
Thomas J. Taule,
Chairman
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<PAGE> 14
- --------------------------------------------------------------------------------
TECHLABS, INC.
(A DEVELOPMENT STAGE COMPANY)
FINANCIAL STATEMENTS
March 31, 1999
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
CONTENTS PAGE
<S> <C> <C>
FINANCIAL STATEMENTS:
Accountants' Compilation Report 2
Balance Sheet 3
Statements of Operations 4
Statements of Changes in Stockholders' Equity 5
</TABLE>
<PAGE> 15
REEL & SWAFFORD, PLLC
Certified Public Accountants
<TABLE>
<S> <C> <C>
OFFICE ADDRESS MAILING ADDRESS
2611 Emoriland Blvd. American Institute of Certified Public Accountants P. O. Box 27599
Knoxville, Tennessee 37917 SEC Practice Section-AICPA Knoxville, TN 37917-7599
(423) 637-7196 Telephone Tennessee Society of Certified Public Accountants (423) 637-6437 Facsimile
</TABLE>
ACCOUNTANTS' COMPILATION REPORT
To the Stockholders
Techlabs, Inc.
Hollywood, Florida
We have complied the accompanying balance sheet of Techlabs, Inc. (a
Development Stage Company, formerly Coordinated Physician Services, Inc.) as of
March 31, 1999, and the related statements of operations and stockholders'
equity for the three months then ended and for the periods from May 26, 1998
(inception) through March 31, 1999, in accordance with Statements on Standards
for Accounting and Review Services issued by the American Institute of
Certified Public Accountants.
A compilation is limited to presenting in the form of financial statements
information that is the representation of management. We have not audited or
reviewed the accompanying financial statements and, accordingly, do not express
an opinion or any other form of assurance on them.
Management has elected to omit substantially all of the disclosures required by
generally accepted accounting principles and the statement of cash flows. If
the omitted statement of cash flows and disclosures were included in the
financial statements, they might influence the user's conclusions about the
company's financial position, results of operations, and its cash flows.
Accordingly, these financial statements are not designed for those who are not
informed about such matters.
/s/ Reel & Swafford, PLLC
Certified Public Accountants
Knoxville, Tennessee
April 1, 1999
<PAGE> 16
TECHLABS, INC.
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEET
March 31, 1999
<TABLE>
<S> <C>
ASSETS
CURRENT ASSETS
Cash $ 127,325
Other receivable 10,000
---------
TOTAL ASSETS $ 137,325
=========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable $ 1,500
---------
TOTAL LIABILITIES $ 1,500
STOCKHOLDERS' EQUITY
Common stock ($.001 par value, 50,000,000 shares
authorized, 3,100,000 shares issued and outstanding) 3,100
Additional paid-in capital 167,400
Preferred stock - special class A ($.001 par value,
12,500,000 shares authorized, 9,000,000 shares issued and outstanding) 9,000
Deficit accumulated during the development stage (43,765)
---------
TOTAL STOCKHOLDERS' EQUITY 135,735
---------
$ 137,235
=========
</TABLE>
See accountants' compilation report.
<PAGE> 17
===============================================================================
TECHLABS, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF OPERATIONS
Three Months Ended March 31, 1999 and
For the Period from May 26, 1998 (Inception)
Through March 31, 1999
===============================================================================
<TABLE>
<CAPTION>
Three From
Months Inception to
Ended March 31,
March 31, 1999 1999
-------------- ------------
<S> <C> <C>
REVENUE $ -0- $ -0-
OPERATING EXPENSES
Office (275) (275)
Consulting fees (5,010) (5,010)
Organization expenses (25,131) (25,131)
Professional (1,500) (1,500)
-------------- ------------
Loss from operations (31,916) (31,916)
OTHER EXPENSES
Cumulative effect of change in accounting principle (11,849) (11,849)
-------------- ------------
Net Loss $ (43,765) $ (43,765)
============== ============
</TABLE>
See accountants' compilation report.
4
<PAGE> 18
===============================================================================
TECHLABS, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
Three Months Ended March 31, 1999 and
For the Period from May 26, 1998 (Inception)
Through March 31, 1999
===============================================================================
<TABLE>
<CAPTION>
PREFERRED STOCK COMMON STOCK ADDITIONAL
---------------------- ----------------------- PAID-IN ACCUMULATED
SHARES AMOUNT SHARES AMOUNT CAPITAL DEFICIT TOTAL
--------- ------ ---------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
Balance, May 26, 1998 -0- $ -0- -0- $ -0- $ -0- $ -0- $ -0-
Initial capitalization of the Company 1,000,000 1,000 1,000
December, 1998, issuance of
common stock under private
placement offering 100,000 100 24,900 25,000
--------- ------ ---------- -------- -------- -------- --------
Balance, December 31, 1998 -0- -0- 1,100,000 1,100 24,900 -0- 26,000
February, 1999, issuance of common
stock under private placement
offering, net of offering costs of
$15,000 1,500,000 1,500 148,500 150,000
February, 1999, conversion of common
stock into preferred 9,000,000 9,000 (1,000,000) (1,000) (8,000) -0-
March, 1999, sale of shares at par 1,500,000 1,500 1,500
Consideration for the issuance of
option agreement 2,000 2,000
Net loss (43,765) (43,765)
--------- ------ ---------- -------- -------- -------- --------
Balance, March 31, 1999 9,000,000 $9,000 3,100,000 $ 3,100 $167,400 $(43,765) $135,735
========= ====== ========== ======== ======== ======== ========
</TABLE>
See accountants' compilation report.
5
<PAGE> 19
===============================================================================
TECHLABS, INC.
(A DEVELOPMENT STAGE COMPANY)
FINANCIAL STATEMENTS
December 31, 1998
===============================================================================
<TABLE>
<CAPTION>
CONTENTS PAGE
<S> <C>
FINANCIAL STATEMENTS:
Report of Independent Auditors 2
Balance Sheet 3
Statement of Operations 4
Statement of Changes in Stockholders' Equity 5
Statement of Cash Flows 6
Notes to Financial Statements 7
</TABLE>
<PAGE> 20
REEL & SWAFFORD, PLLC
Certified Public Accountants
<TABLE>
<CAPTION>
<S> <C> <C>
Office Address Mailing Address
2611 Emoriland Blvd. American Institute of Certified Public Accountants P. O. Box 27599
Knoxville, Tennessee 37917 SEC Practice Section-AICPA Knoxville, TN 37917-7599
(423) 637-7196 Telephone Tennessee Society of Certified Public Accountants (423) 637-6437 Facsimile
</TABLE>
REPORT OF INDEPENDENT AUDITORS
To the Board of Directors and Stockholders
Techlabs, Inc.
We have audited the accompanying balance sheet of Techlabs, Inc. (a
Development Stage Company, formerly Coordinated Physician Services, Inc.)
as of December 31, 1998, and the related statements of operations, changes
in stockholders' equity and cash flows for the period from May, 26, 1998
(inception) through December 31, 1998. These financial statements are the
responsibility of the Company's management. Our responsibility is to
express an opinion on these financial statements based on our audit.
We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used
and significant estimates made by management, as well as evaluating the
overall financial statement presentation. We believe that our audit
provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Techlabs, Inc. as of
December 31, 1998 and the results of its operations and its cash flows for
the period from May, 26, 1998 (inception) through December 31, 1998 in
conformity with generally accepted accounting principles.
REEL & SWAFFORD, PLLC
Certified Public Accountants
Knoxville, Tennessee
March 17, 1999
<PAGE> 21
===============================================================================
TECHLABS, INC.
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEET
December 31, 1998
===============================================================================
<TABLE>
<CAPTION>
ASSETS
<S> <C>
CURRENT ASSETS
Cash $15,000
INTANGIBLE ASSETS
Organization Costs 11,849
-------
TOTAL ASSETS $26,849
=======
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable $ 849
-------
TOTAL LIABILITIES 849
STOCKHOLDERS' EQUITY
Common stock ($.001 par value, 50,000,000 shares
authorized, 1,100,000 shares issued and outstanding) 1,100
Additional paid-in capital 24,900
-------
TOTAL STOCKHOLDERS' EQUITY 26,000
-------
$26,849
=======
</TABLE>
The accompanying notes are an integral part of these financial statements.
3
<PAGE> 22
===============================================================================
TECHLABS, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF OPERATIONS
For the Period from May 26, 1998 (Inception)
Through December 31, 1998
===============================================================================
<TABLE>
<CAPTION>
<S> <C>
REVENUE $ -0-
EXPENSES -0-
----------
Net Income $ -0-
==========
</TABLE>
The accompanying notes are an integral part of these financial statements.
4
<PAGE> 23
===============================================================================
TECHLABS, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF CHANGES IN STOCKHOLDER'S EQUITY
For the Period from May 26, 1998 (Inception)
Through December 31, 1998
===============================================================================
<TABLE>
<CAPTION>
Additional
Common Paid-in Retained
Stock Capital Earnings Total
------ -------- --------- -------
<S> <C> <C> <C> <C>
Balance, May 26, 1998 $ -0- $ -0- $ -0- $ -0-
Initial capitalization of the Company 1,000 1,000
Sale of 100,000 shares of common
stock under Rule 504 offering 100 24,900 25,000
------ -------- --------- -------
Balance, December 31, 1998 $1,100 $ 24,900 $ -0- $26,000
====== ======== ========= =======
</TABLE>
The accompanying notes are an integral part of these financial statements.
5
<PAGE> 24
===============================================================================
TECHLABS, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF CASH FLOWS
For the Period from May 26, 1998 (Inception)
Through December 31, 1998
===============================================================================
<TABLE>
<CAPTION>
OPERATING ACTIVITIES
<S> <C>
Net income (loss) $ -0-
Adjustments to reconcile net income to net
cash provided by operating activities:
Increase in accounts payable 849
--------
Net Cash Provided by Operating Activities 849
INVESTING ACTIVITIES
Organization costs incurred (11,849)
--------
Net Cash Used in Investing Activities (11,849)
FINANCING ACTIVITIES
Sale of common stock 26,000
--------
Net Cash Provided by Financing Activities 26,000
--------
Change in Cash and Cash Equivalents 15,000
Cash and cash equivalents, May 26, 1998 -0-
--------
Cash and cash equivalents, December 31, 1998 $ 15,000
========
</TABLE>
The accompanying notes are an integral part of these financial statements.
6
<PAGE> 25
===============================================================================
TECHLABS, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO BALANCE SHEET
For the Period from May 26, 1998 (Inception)
Through December 31, 1998
===============================================================================
NOTE 1 - SIGNIFICANT ACCOUNTING POLICIES
BUSINESS Techlabs Inc. (a Development Stage Company, formerly Coordinated
Physician Services, Inc.) was organized under the laws of the State of Florida
on May 26, 1998. In February, 1999, the Company changed its name to Techlabs,
Inc. (See Note 5). With the name change, the Company's plans have been
redirected towards exploring opportunities for the development and operation of
companies focused on the Internet. The Company intends to accomplish its goals
predominantly though strategic venture investments. The Company's plans include
investment in Internet companies either directly or through venture capital
funding arrangements. To a lesser extent, the Company will also effect
strategies aimed at the internal development and operation of majority owned
subsidiaries. Because of its lack of operating history, the Company is
considered in the development stage and the accompanying financial statements
represent that of a development stage enterprise.
ORGANIZATION COSTS The Company capitalizes costs associated with its start-up
and with its organization. These costs are to be amortized over a ten year
period beginning with the inception of operations. See Note 3.
USE OF ESTIMATES The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities and
disclosures of contingent assets and liabilities at the date of the financial
statements. Actual results could differ from those estimates.
INCOME TAXES Deferred income taxes are provided for temporary differences in
reporting income for financial statement and tax purposes. Because no revenue or
expense has been recorded in the Company's accounts, no provision for income
taxes has been made.
CASH AND CASH EQUIVALENTS For purposes of the statements of cash flows, the
Company considers all highly liquid investments with initial maturities of three
months or less which are readily convertible to cash without significant loss or
penalty to be cash equivalents.
NOTE 2 - STATEMENT OF CASH FLOWS SUPPLEMENTAL DISCLOSURE
During the period ended December 31, 1998, the Company paid no interest or
income taxes.
NOTE 3 - IMPACT OF NEW ACCOUNTING PRONOUNCEMENTS
Statement of Position 98-5, Reporting on the Costs of Start-Up Activities ("SOP
98-5"), issued by the Accounting Standards Executive Committee of the American
Institute of Certified Public Accountants, is effective for the Company in 1999.
SOP 98-5 will require the Company to expense costs associated with
7
<PAGE> 26
===============================================================================
TECHLABS, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
For the Period from May 26, 1998 (Inception)
Through December 31, 1998
===============================================================================
NOTE 3 - IMPACT OF NEW ACCOUNTING PRONOUNCEMENTS (CONTINUED)
start-up activities as incurred beginning with 1999. Adoption of SOP 98-5 will
also require the Company to report the effects of applying SOP -98-5 as a
cumulative effect of a change in accounting principles in its 1999 financial
statements.
NOTE 4 - STOCKHOLDERS' EQUITY
On August 10, 1998, the Company amended its Articles of Incorporation to provide
for an additional class of stock and to increase the authorized shares of its
common stock. The amendment increased the Company's common stock from 100,000 to
50,000,000 shares authorized and provided authorization for 20,000,000 shares of
$.001 par value preferred voting stock.
Concurrent with the amendment, the Company effected a ten for one stock split,
restating par value of the outstanding common shares from $.01 to $.001. All
amounts presented give effect for the split.
The preferred stock's participation rights as a class in any dividends or
liquidation proceeds are limited to one percent. Each share of preferred stock
receives one vote in stockholder voting matters. At the option of the Company,
the preferred stock may be redeemed in the Company's common shares at an
exchange rate of one share of common stock for each share of preferred stock.
All of the shares of the Company's common stock issued are "Restricted
Securities" as defined under the Securities Act of 1933 (the 1933 Act). These
shares may not be sold or transferred unless they are covered under an effective
registration, or there is an available exemption for such registration
requirement. Current law provides that unregistered shares may be sold pursuant
to Rule 144, which imposes certain limitations on quantity, requires a minimum
of one year of ownership, and imposes conditions upon the manner of sale.
NOTE 5 - SUBSEQUENT EVENTS
On February 24, 1999, the Company amended its Articles of Incorporation to
reduce authorization of the Company's $.001 par value preferred voting stock
from 20,000,000 to 10,000,000 shares and provided authorization for 25,000,000
shares of $.001 par value special preferred stock. Of these 25,000,000
authorized shares, 12,500,000 were designated as Class A special preferred
stock.
The special preferred stock is to receive no preference in dividend
distributions or in the event of liquidation. Each share of special preferred
stock shall receive one vote in stockholder voting matters. Dividend and
redemption features are determinable at the discretion of the board of
directors.
8
<PAGE> 27
===============================================================================
TECHLABS, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
For the Period from May 26, 1998 (Inception)
Through December 31, 1998
===============================================================================
NOTE 5 - SUBSEQUENT EVENTS (CONTINUED)
Also on February 24, 1999, the Company amended its charter to effect a change in
the Company's name from Coordinated Physician Services, Inc. to Techlabs, Inc.
Subsequent to the balance sheet date, the Company has offered, pursuant to
exceptions permitted under Regulation D of the 1933 Act, 1,500,000 shares of
common stock at $.10 per share, on a "best efforts" basis, by its officers and
directors.
9
<PAGE> 1
EXHIBIT 2(a)
ARTICLES OF INCORPORATION
FOR
COORDINATED PHYSICIAN SERVICES, INC.
ARTICLE I
The name of the corporation is: COORDINATED PHYSICIAN SERVICES, INC.
The mailing address of the corporation is: 21311 N.W. 2nd Avenue, North Miami,
FL 33169.
ARTICLE II
The duration of the corporation shall be perpetual. The date and time
of the commencement of the corporate existence of the corporation shall be upon
filing these Articles of Incorporation with the Secretary of State of Florida.
ARTICLE III
The nature of the business and the objects and purposes to be
transacted, promoted or carried on by the corporation are to engage in any
lawful act, activity or business for which corporations may be organized under
the laws of the United States of America and of the State of Florida.
Additionally, this corporation shall have all of the powers vested in a
corporation organized under and existing by virtue of the laws of the State of
Florida.
ARTICLE IV
The aggregate number of shares which the corporation is authorized to
issue and have outstanding at any time is 100,000 common shares. Such 100,000
common shares shall consist of one
1
<PAGE> 2
class only having a par value of $.01 per share.
ARTICLE V
The street address of the initial registered office of the corporation
is 21311 N.W. 2nd Avenue, North Miami, FL 33169. The name of the corporation's
initial registered agent at said address is THOMAS J. TAULE.
ARTICLE VI
The number of directors constituting the initial Board of Directors
shall be one (1). The name and street address of the initial member of the
Board of Directors is:
THOMAS J. TAULE
21311 N.W. 2nd Avenue,
North Miami, FL 33169.
The number of Directors may be increased or diminished from time to
time by Bylaws adopted by either the Shareholders or the Directors, but shall
never be less than such number as required by the laws of the State of Florida.
ARTICLE VII
The name and street address of the incorporator is:
THOMAS J. TAULE
21311 N.W. 2nd Avenue,
North Miami, FL 33169.
ARTICLE VIII
No contract or other transaction between this corporation and one or
more of its directors, officers and/or shareholders or any other corporation,
firm, association or entity in which one or more of its directors, officers
and/or shareholders are directors,
2
<PAGE> 3
officers, shareholders or are financially interested shall be either void or
voidable because of such relationship or interest, because such director or
directors are present at the meeting of the board of directors or a committee
thereof which authorizes, approves or ratifies such contract or transaction, or
because his or their votes are counted for such purpose, if:
(a) The fact of such relationship or interest is disclosed or known to
the board of directors or committee which authorizes, approves or ratifies the
contract or transaction by a vote or consent sufficient for the purpose without
counting the votes or consents of such interested directors; or
(b) The fact of such relationship or interest is disclosed or known to
the shareholders entitled to vote and they authorize, approve or ratify such
contract or transaction by vote or written consent; or
(c) The contract or transaction is fair and reasonable as the
corporation at the time it is authorized by the board, a committee thereof or
the shareholders.
ARTICLE IX
These Articles of Incorporation may be amended in the manner provided
by Florida law.
3
<PAGE> 4
IN WITNESS WHEREOF the undersigned has caused these Articles of
Incorporation to be executed at Miami, Florida this 13th day of May, 1998.
/s/ Thomas J. Taule
------------------------------------
THOMAS J. TAULE, Incorporator and
Registered Agent
STATE OF FLORIDA )
) SS:
COUNTY OF DADE )
The foregoing Articles of Incorporation were sworn to, subscribed and
acknowledged before me this 13th day of May, 1998, THOMAS J. TAULE, Incorporator
and Registered Agent, personally known to me.
/s/ David M. Glassberg
------------------------------------
Notary Public, State of Florida
My Commission Expires:
[SEAL]
4
<PAGE> 5
ACCEPTANCE OF REGISTERED AGENT
Having been designated registered agent for COORDINATED PHYSICIAN
SERVICES, INC., a corporation to be organized under the laws of the State of
Florida, the undersigned hereby accepts such appointment and the obligations of
that position and represents that the undersigned is familiar with the
obligations of that position.
IN WITNESS WHEREOF, the undersigned has executed this Acceptance this
13th day of May, 1998.
/s/ Thomas J. Taule
--------------------------------------
THOMAS J. TAULE, Registered Agent
5
<PAGE> 1
Exhibit 2(b)
ARTICLES OF AMENDMENT
FOR
COORDINATED PHYSICIAN SERVICES, INC.
Pursuant to Florida Statutes, the following is submitted:
1. The name of this corporation is:
COORDINATION PHYSICIAN SERVICES, INC.
2. The Articles of Incorporation are amended by striking
therefrom Article III, in its entirety, and inserting in place thereof the
following:
ARTICLE III - CAPITAL STOCK
This Corporation is authorized to issue two classes of capital stock
designated "Common Stock" and "Preferred Stock", respectively. The number of
shares of Common Stock authorized to be issued is fifty million (50,000,000)
and shall have a par value of $.001 per share. The number of shares of Preferred
Stock authorized to be issued is twenty million (20,000,000) and shall have a
par value of $.001 per share.
1. Liquidation and Dividend Rights.
1.1 Liquidation Rights. In the event of any liquidation,
dissolution or winding up of this corporation, whether voluntary or involuntary,
(1) the holders of the Common Stock shall be entitled to ninety nine (99%)
percent of the assets of this corporation available for distribution to its
shareholders, whether such assets are capital, surplus or earnings, such
percentage to be divided pro rata among each of the holders of the Common Stock
according to the number of shares of Common Stock held by each such holder; and
(ii) the holders of the Preferred Stock shall be entitled to one (1%) percent of
the assets of this corporation available for distribution to its shareholders,
whether such assets are capital, surplus or earnings, such percentage to be
divided pro rata among each of the holders of the Preferred Stock according to
the number of shares of Preferred Stock held by each such holder. The holders of
Preferred Stock shall not receive a preference of liquidation.
1.2 Reorganization. A reorganization, consolidation or merger
of this corporation with or into any other corporation or corporations or other
entity or entities, or a sale, conveyance,
1
<PAGE> 2
lease, transfer or other disposition of all or substantially all the properties
and assets of this corporation, or a sale or other transfer, in a single
transaction or in a series of related transactions, of 50% or more of the
outstanding capital stock of this corporation, shall not be deemed a
liquidation, dissolution or winding up of this corporation for the purpose of
this Article.
1.3 Valuation. Whenever the distribution provided for herein
shall be paid in property other than cash, the value of such distribution shall
be the fair market value of such property as determined in good faith by the
Board of Directors of this corporation.
1.4 Dividend Rights. The holders of the then outstanding
Common Stock shall be entitled to receive ninety nine (99%) percent of any
dividends, when and as declared by the Board of Directors of this corporation,
and out of any funds and assets legally available therefore, such percentage to
be divided pro rata among each of the holders of the Common Stock according to
the number of shares of Common Stock held by each such holder. The holders of
the then outstanding Preferred Stock shall be entitled to receive one (1%)
percent of any dividends, when and as declared by the Board of Directors of this
corporation, and out of any funds and assets legally available therefor, such
percentage to be divided pro rata among each of the holders of the Preferred
Stock according to the number of shares of Preferred Stock held by each such
holder. Such dividends may be payable quarterly or otherwise as the Board of
Directors of this corporation may from time to time determine. The holders of
Preferred Stock shall not receive a preference in the event a dividend is
declared.
2. Voting Rights. Except as otherwise required by law, the rights of the
holders of Common Stock and Preferred Stock to vote on any matters submitted to
shareholders of this corporation shall be as follows:
2.1 Common Stock. Each holder of shares of Common Stock
shall be entitled to vote on all matters submitted to a vote of the shareholders
of this corporation and shall be entitled to one (1) vote for each share of
Common Stock held at the record date for the determination of the shareholders
entitled to vote on such matters or, if no such record date is established, at
the date such vote is taken or any written consent of shareholders is solicited.
2.2 Preferred Stock. Each holder of shares of Preferred
Stock shall be entitled to vote on all matters submitted to a vote of the
shareholders of this corporation and shall be entitled to one (1) vote for each
share of Preferred Stock held at the record date for the determination of the
shareholders entitled to vote on such matters or, if no such record date is
established, at the date such vote is taken or any written consent of
shareholders is solicited.
2
<PAGE> 3
2.3 Class Voting. The holders of the Common Stock and the
holders of the Preferred Stock shall vote together as a single class.
3. Redemption of Preferred Stock. At the option of the Corporation, the
Corporation may redeem all of the Preferred Stock. In the event of said
Redemption, each share of Preferred Stock shall be exchanged for one (1)
share of the Corporation's Common Stock.
4. Other Rights. Except as otherwise provided in this Article, the rights
of the holders of the Common Stock and the rights of the holders of the
Preferred Stock shall be identical.
The foregoing amendment was adopted by all of the Directors of the
Corporation and the sole Stockholder of the Corporation at a Special Meeting
of the Board of Directors, pursuant to Florida Statutes, on the 31st day of
July, 1998.
IN WITNESS WHEREOF, the undersigned President and Secretary of this
corporation has executed these Articles of Amendment this 31st day of July,
1998.
/s/ Thomas J. Taule
----------------------------
Thomas J. Taule
President and Secretary
STATE OF FLORIDA )
) ss:
COUNTY OF DADE )
The foregoing instrument was acknowledged before me the day and year
least above written by Thomas J. Taule, President and Secretary of the
above-named Florida Corporation, on behalf of the corporation.
/s/
-------------------------------
Notary Public, State of Florida
My Commission expires:
[SEAL]
3
<PAGE> 4
ARTICLES OF AMENDMENT
FOR
COORDINATED PHYSICIAN SERVICES, INC.
Pursuant to Florida Statutes, the following is submitted:
1. The name of this corporation is:
COORDINATED PHYSICIAN SERVICES, INC.
2. The Articles of Incorporation and Articles of Amendment are amended by
striking therefrom Article III, in its entirety, and inserting in place thereof
the following:
ARTICLE III - CAPITAL STOCK
This Corporation is authorized to issue three classes of capital stock
designated "Common Stock", "Preferred Stock" and "Special Preferred Stock"
respectively. The number of shares of Common Stock authorized to be issued is
fifty million (50,000,000) and shall have a par value of $.001 per share. The
number of shares of Preferred Stock authorized to be issued is ten million
(10,000,000) and shall have a par value of $.001 per share. The number of
shares of Special Preferred Stock authorized to be issued is twenty-five
million (25,000,000) and shall have a par value of $.001 per share. Of the
twenty-five million (25,000,000) shares of Special Preferred Stock, twelve
million five hundred thousand (12,500,000) shares shall be designated Class A
Special Preferred Stock and shall have a par value of $.001 per share.
1. Liquidation and Dividend Rights.
1.1 Liquidation Rights. Except as provided herein, in the event of any
liquidation, dissolution or winding up of this corporation, whether voluntary
or involuntary, (1) the holders of the Common Stock shall be entitled to ninety
nine (99%) percent of the assets of this corporation available for distribution
to its shareholders, whether such assets are capital, surplus or earnings, such
percentage to be divided pro rata among each of the holders of the Common Stock
according to the number of shares of Common Stock held by each such holder; and
(ii) the holders of the Preferred Stock shall be entitled to one (1%) percent
of the assets of this corporation available for distribution to its
shareholders, whether such assets are capital, surplus or earnings, such
percentage to be divided pro rata among each of the holders of the Preferred
Stock according to the number of shares of Preferred Stock held by each such
holder. The holders of Special Preferred Stock shall not receive a preference
on liquidation.
1
<PAGE> 5
1.2 Reorganization. A reorganization, consolidation or merger of this
corporation with or into any other corporation or corporations or other entity
or entities, or a sale, conveyance, lease, transfer or other disposition of all
or substantially all the properties and assets of this corporation, or a sale
or other transfer, in a single transaction or in a series of related
transactions, or 50% or more of the outstanding capital stock of this
corporation, shall not be deemed a liquidation, dissolution or winding up of
this corporation for the purpose of this Article.
1.3 Valuation. Whenever the distribution provided for herein shall be paid
in property other than cash, the value of such distribution shall be the fair
market value of such property as determined in good faith by the Board of
Directors of this corporation.
1.4 Dividend Rights. Except as provided herein, the holders of the then
outstanding Common Stock shall be entitled to receive ninety nine (99%) percent
of any dividends, when and as declared by the Board of Directors of this
corporation, and out of any funds and assets legally available therefore, such
percentage to be divided pro rata among each of the holders of the Common Stock
according to the number of shares of Common Stock held by each such holder. The
holders of the then outstanding Preferred Stock shall be entitled to receive one
(1%) percent of any dividends, when and as declared by the Board of Directors of
this corporation, and out of any funds and assets legally available therefor,
such percentage to be divided pro rata among each of the holders of the
Preferred Stock according to the number of shares of Preferred Stock held by
each such holder. Such dividends may be payable quarterly or otherwise as the
Board of Directors of this corporation may from time to time determine. The
holders of Special Preferred Stock shall not receive a preference in the event a
dividend is declared.
2. Voting Rights. Except as otherwise required by law, the rights of the
holders of Common Stock, Preferred Stock and Special Preferred Stock to vote on
any matters submitted to shareholders of this corporation shall be as follows:
2.1 Common Stock. Each holder of shares of Common Stock shall be entitled
to vote on all matters submitted to a vote of the shareholders of this
corporation and shall be entitled to one (1) vote for each share of Common
Stock held at the record date for the determination of the shareholders
entitled to vote on such matters or, if no such record date is established, at
the date such vote is taken or any written consent of shareholders is solicited.
2.2 Preferred Stock. Except as discussed in Section 2.4 below, each holder
of shares of Preferred Stock shall be entitled to vote on all matters submitted
to a vote of the shareholders of this corporation and shall be entitled to one
(1) vote for each
2
<PAGE> 6
share of Preferred Stock held at the record date for the determination of the
shareholders entitled to vote on such matters or, if no such record date is
established, at the date such vote is taken or any written consent of
shareholders is solicited.
2.3 Special Preferred Stock. Except for the Class A Special Preferred
Stock discussed in Section 2.4 below, each holder of shares of Special
Preferred Stock shall be entitled to vote on all matters submitted to a vote of
the shareholders of this corporation and shall be entitled to vote as discussed
below at the record date for the determination of the shareholders entitled to
vote on such matters or, if no such record date is established, at the date
such vote is taken or any written consent of shareholders is solicited.
Authority is hereby vested in the Board of Directors of the Corporation to
provide, from time to time, for the issuance of the Special Preferred Stock in
connection therewith to determine, with a majority of shareholder approval, the
number of shares to be included and such designations, powers, preferences and
relative rights and the qualifications, limitations and restrictions of the
Special Preferred Stock, including, without limiting the generality of the
foregoing, any of the following provisions with respect to which the Board of
Directors shall determine:
1. The annual dividend rate or rates payable on shares of the Special
Preferred Stock, the date or dates from which such dividends shall commence to
accrue and the dividend payment dates for such dividends;
2. Whether dividends on such series are to be cumulative or non-cumulative
and the participating or other special rights, if any, with respect to the
payment of dividends;
3. Whether the Special Preferred Stock shall be subject to redemption and,
if so, the manner of redemption, the redemption price or prices and the terms
and conditions on which shares of the Special Preferred Stock may be redeemed.
4. Whether the Special Preferred Stock shall have a sinking fund or other
retirement provisions for the redemption or purchase of shares of the Special
Preferred Stock and if so, the terms and amount of such sinking fund or other
retirement provisions and the extent to which the charges therefor are to have
priority over the payment of dividends on or the making of sinking fund or other
like retirement provisions for share of any other series or over the payment of
dividends on the Common Stock and/or the Preferred Stock;
5. The amounts payable on shares of such series of voluntary or involuntary
dissolution, liquidation, or winding up of the
3
<PAGE> 7
EXHIBIT 2(b)
affairs of the corporation and the extent to which such payment shall have
priority over the payment of any amount on voluntary or involuntary
dissolution, liquidation, or winding up of the affairs of the corporation
on shares of any other series of Preferred Stock and/or on the Common Stock;
6. The terms and conditions if any, on which the Special Preferred Stock
may be converted into or exchanged for shares of any other series the Preferred
Stock and/or of Common Stock;
7. The stated value, if any, for the shares of the Special Preferred
Stock, the consideration for which shares of the Special Preferred Stock may
be issued and the amount of such consideration that shall be credited to the
capital account;
8. The voting rights and powers for each share of Special Preferred
Stock; and
9. Any other preferences and relative, participating, optional, or other
special rights and qualifications, limitations or restrictions thereof, or any
other term or provision of shares of the Special Preferred Stock as the Board
of Directors may deem appropriate or desirable.
2.4 Class A Special Preferred Stock. The rights of the holders of
Class A Special Preferred Stock shall be entitled to one (1) vote for each
share of Class A Special Preferred Stock held at the record date for the
determination of the shareholders entitled to vote on such matters or, if no
such record date is established, at the date such vote is taken or any written
consent of shareholders is solicited.
2.5 Class Voting. The holders of the Common Stock, the holders of
the Preferred Stock and the holders of Special Preferred Stock shall vote
together as a single class.
3. Redemption of Preferred Stock. At the sole option of the Corporation, the
Corporation may redeem all of the Preferred Stock. In the event of said
Redemption, each share of Preferred Stock shall be exchanged for one (1) share
of the Corporation's Common Stock.
4. Redemption of Class A Special Preferred Stock. At the sole option of the
Corporation, the Corporation may redeem all of the Class A Special Preferred
Stock. If the Corporation shall redeem the Class A Special Preferred Stock, the
Board of Directors shall determine the manner of redemption, the redemption
price or prices and the terms and conditions on which shares of the Class A
Special Preferred Stock may be redeemed;
5. Other Rights. Except as otherwise provided in this Article, the rights
of the holders of the Common Stock, the rights of the
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<PAGE> 8
holders of the Preferred Stock and the rights of the holders of the Special
Preferred Stock, including the Class A Special Preferred Stock, shall be
identical.
The foregoing amendment was adopted by all of the Directors of the
Corporation at a Special Meeting of Directors, pursuant to Florida Statutes, on
the 18th day of February, 1999. The foregoing amendment was adopted by a
majority vote of the Stockholders present at the Board of Directors meeting,
pursuant to Florida Statutes, on the 18th day of February, 1999. A majority vote
of the Stockholders is sufficient for approval of these Articles of Amendment.
IN WITNESS WHEREOF, the undersigned President and Secretary of this
corporation has executed these Articles of Amendment this 18th day of February,
1999.
/s/ Thomas J. Taule, as President
------------------------------------
Thomas J. Taule, President and
Secretary
STATE OF FLORIDA )
) ss:
COUNTY OF DADE )
The foregoing instrument was acknowledged before me the day and year
last above written by Thomas J. Taule, President and Secretary, of the
above-named Florida corporation, on behalf of the corporation.
/s/ David M. Glassberg
------------------------------------
Notary Public, State of Florida
My Commission expires:
December 25, 2002
[SEAL]
5
<PAGE> 9
ARTICLES OF AMENDMENT
OF
COORDINATED PHYSICIAN SERVICES, INC.
Pursuant to Florida Statutes, the following is submitted:
1. The name of this organization is:
COORDINATED PHYSICIAN SERVICES, INC.
2. The Articles of Incorporation are amended by striking the name
COORDINATED PHYSICIAN SERVICES, INC. from Article I and inserting in place
thereof the following:
ARTICLE I - NAME
The name of this organization shall be:
TECHLABS, INC.
3. The foregoing amendment was adopted by a unanimous vote of the
members of the Board of Directors present at the Board of Directors meeting,
pursuant to Florida Statutes, on the 24th day of February, 1999.
4. The foregoing amendment was adopted by a majority vote of the
Stockholders present at the Board of Directors meeting, pursuant to Florida
Statutes, on the 24th day of February, 1999. A majority vote of the
Stockholders is sufficient for approval of these Articles of Amendment.
5. There are no other Directors entitled to vote on this amendment.
IN WITNESS WHEREOF, the undersigned President and Secretary of this
Corporation have executed these Articles of Amendment this 24th day of
February, 1999.
/s/ Thomas J. Taule
------------------------------------
THOMAS J. TAULE, President
/s/ Alfred E. Taule
------------------------------------
ALFRED E. TAULE, Secretary
<PAGE> 10
STATE OF FLORIDA )
)ss:
COUNTY OF DADE )
The foregoing instrument was acknowledged before me the day and year last
above written by THOMAS J. TAULE and ALFRED E. TAULE (both personally known),
President and Secretary of the above-named Florida corporation, on behalf of
the Corporation.
/s/ David M. Glassberg
-------------------------------
Notary Public, State of Florida
My Commission expires:
December 25, 2002
[SEAL]
<PAGE> 11
ARTICLES OF AMENDMENT
FOR
TECHLABS, INC.
Pursuant to Florida Statutes, the following is submitted:
1. The name of this corporation is:
TECHLABS, INC.
2. The Articles of Incorporation and Articles of Amendment are
amended by striking therefrom Article III, in its entirety, and inserting in
place thereof the following:
ARTICLE III - CAPITAL STOCK
This Corporation is authorized to issue three classes of capital stock
designated "Common Stock", "Preferred Stock" and "Special Preferred Stock"
respectively. The number of shares of common Stock authorized to be issued is
fifty million (50,000,000) and shall have a par value of $.001 per share. The
number of shares of Preferred Stock authorized to be issued is ten million
(10,000,000) and shall have a par value of $.001 per share. The number of
shares of Special Preferred Stock authorized to be issued is twenty-five
million (25,000,000) and shall have a par value of $.001 per share. Of the
twenty-five million (25,000,000) shares of Special Preferred Stock, twelve
million five hundred thousand (12,500,000) shares shall be designated Class A
Special Preferred Stock and shall have a par value of $.001 per share.
1. Liquidation and Dividend Rights.
1.1 Liquidation Rights. Except as provided herein, in the event of
any liquidation, dissolution or winding up of this corporation, whether
voluntary or involuntary, (1) the holders of the Common Stock shall be entitled
to ninety nine (99%) percent of the assets of this corporation available for
distribution to its shareholders, whether such assets are capital, surplus or
earnings, such percentage to be divided pro rata among each of the holders of
the Common Stock according to the number of shares of Common Stock held by each
such holder; and (ii) the holders of the Preferred Stock shall be entitled to
one (1%) percent of the assets of this corporation available for distribution
to its shareholders, whether such assets are capital, surplus or earnings, such
percentage to be divided pro rata among each of the holders of the Preferred
Stock according to the number of shares of Preferred Stock held by each such
holder. The holders of Special Preferred Stock shall not receive any assets in
the event of a liquidation.
1
<PAGE> 12
1.2 Reorganization. A reorganization, consolidation or merger of this
corporation with or into any other corporation or corporations or other entity
or entities, or a sale, conveyance, lease, transfer or other disposition of all
or substantially all the properties and assets of this corporation, or a sale
or other transfer, in a single transaction or in a series of related
transactions, of 50% or more of the outstanding capital stock of this
corporation, shall not be deemed a liquidation, dissolution or winding up of
this corporation for the purposed of this Article.
1.3 Valuation. Whenever the distribution provided for herein shall be
paid in property other than cash, the value of such distribution shall be the
fair market value of such property as determined in good faith by the Board of
Directors of this corporation.
1.4 Dividend Rights. Except as provided herein, the holders of the
then outstanding Common Stock shall be entitled to receive ninety nine (99%)
percent of any dividends, when and as declared by the Board of Directors of this
corporation, and out of any funds and assets legally available therefore, such
percentage to be divided pro rata among each of the holders of the Common Stock
according to the number of shares of Common Stock held by each such holder. The
holders of the then outstanding Preferred Stock shall be entitled to receive one
(1%) percent of any dividends, when and as declared by the Board of Directors of
this corporation, and out of any funds and assets legally available therefor,
such percentage to be divided pro rata among each of the holders of the
Preferred Stock according to the number of shares of Preferred Stock held by
each such holder. Such dividends may be payable quarterly or otherwise as the
Board of Directors of this corporation may from time to time determine. The
holders of Special Preferred Stock shall not receive any dividends.
2. Voting Rights. Except as otherwise required by law, the rights of the
holders of Common Stock, Preferred Stock and Special Preferred Stock to vote on
any matters submitted to shareholders of this corporation shall be as follows:
2.1 Common Stock. Each holder of shares of Common Stock shall be
entitled to vote on all matters submitted to a vote of the shareholders of this
corporation and shall be entitled to one (1) vote for each share of Common
Stock held at the record date for the determination of the shareholders
entitled to vote on such matters or, if no such record date is established, at
the date such vote is taken or any written consent of shareholders is solicited.
2.2 Preferred Stock. Except as discussed in Section 2.4 below, each
holder of shares of Preferred Stock shall be entitled to vote on all matters
submitted to a vote of the shareholders of this corporation and shall be
entitled to one (1) vote for each share of Preferred Stock held at the record
date for the
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<PAGE> 13
determination of the shareholders entitled to vote on such matters or, if no
such record date is established, at the date such vote is taken or any written
consent of shareholders is solicited.
2.3 Special Preferred Stock. Except for the Class A Special
Preferred Stock discussed in Section 2.4 below, each holder of shares of Special
Preferred Stock shall be entitled to vote on all matters submitted to a vote of
the shareholders of this corporation and shall be entitled to vote as discussed
below at the record date for the determination of the shareholders entitled to
vote on such matters or, if no such record date is established, at the date such
vote is taken or any written consent of shareholders is solicited.
Authority is hereby vested in the Board of Directors of the Corporation to
provide, from time to time, for the issuance of the Special Preferred Stock in
connection therewith to determine, with a majority of shareholder approval, the
number of shares to be included and such of the designations, powers,
preferences and relative rights and the qualifications, limitations and
restrictions of the Special Preferred Stock, including, without limiting the
generality of the foregoing, any of the following provisions with respect to
which the Board of Directors shall determine:
1. The annual dividend rate or rates payable on shares of the Special
Preferred Stock, the date or dates from which such dividends shall commence to
accrue and the dividend payment dates for such dividends;
2. Whether dividends on such series are to be cumulative or
non-cumulative and the participating or other special rights, if any, with
respect to the payment of dividends;
3. Whether the Special Preferred Stock shall be subject to redemption
and, if so, the manner of redemption, the redemption price or prices and the
terms and conditions on which shares of the Special Preferred Stock may be
redeemed.
4. Whether the Special Preferred Stock shall have a sinking fund or
other retirement provisions for the redemption or purchase of shares of the
Special Preferred Stock and if so, the terms and amount of such sinking fund or
other retirement provisions and the extent to which the charges therefor are to
have priority over the payment of dividends on or the making of sinking fund or
other like retirement provisions for share of any other series or over the
payment of dividends on the Common Stock and/or the Preferred Stock;
5. The amounts payable on shares of such series of voluntary or
involuntary dissolution, liquidation, or winding up of the affairs of the
corporation and the extent to which such payment
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<PAGE> 14
shall have priority over the payment of any amount on voluntary or involuntary
dissolution, liquidation, or winding up of the affairs of the corporation on
shares of any other series of Preferred Stock and/or on the Common Stock;
6. The terms and conditions if any, on which the Special Preferred Stock
may be converted into or exchanged for shares of any other series the Preferred
Stock and/or of Common Stock;
7. The stated value, if any, for the shares of the Special Preferred
Stock, the consideration for which shares of the Special Preferred Stock may be
issued and the amount of such consideration that shall be credited to the
capital account;
8. The voting rights and powers for each share of Special Preferred
Stock; and
9. Any other preference and relative, participating, optional, or other
special rights and qualifications, limitations or restrictions thereof, or any
other term or provision of shares of the Special Preferred Stock as the Board
of Directors may deem appropriate or desirable.
2.4 Class A Special Preferred Stock. The rights of the holders of
Class A Special Preferred Stock shall be entitled to three (3) votes for each
share of Class A Special Preferred Stock held at the record date for the
determination of the shareholders entitled to vote on such matters or, if no
such record date is established, at the date such vote is taken or any written
consent of shareholders is solicited.
2.5 Class Voting. The holders of the Common Stock, the holders of
the Preferred Stock, the holders of Special Preferred Stock and the holders of
Class A Special Preferred Stock shall vote together as a single class.
3. Redemption of Preferred Stock. At the sole option of the Corporation, the
Corporation may redeem all of the Preferred Stock. In the event of said
Redemption, each share of Preferred Stock shall be exchanged for one (1) share
of Corporation's Common Stock.
4. Redemption of Class A Special Preferred Stock. At the sole option of the
Corporation, the Corporation may redeem all of the Class A Special Preferred
Stock. If the Corporation shall redeem the Class A Special Preferred Stock, the
Board of Directors shall determine the manner of redemption, the redemption
price or prices and the terms and conditions on which shares of the Class A
Special Preferred Stock may be redeemed;
5. Other Rights. Except as otherwise provided in this Article, the rights
of the holders of the Common Stock, the rights of the
4
<PAGE> 15
holders of the Preferred Stock and the rights of the holders of the Special
Preferred Stock, including the Class A Special Preferred Stock, shall be
identical.
The foregoing amendment was adopted by all of the Directors of the
Corporation at a Special Meeting of Directors, pursuant to Florida Statutes, on
the 12th day of May, 1999. The foregoing amendment was adopted by a majority
vote of the Stockholders present at the Board of Directors meeting, pursuant to
Florida Statutes, on the 12th day of May, 1999. A majority vote of the
Stockholders is sufficient for approval of these Articles of Amendment.
IN WITNESS WHEREOF, the undersigned President and Secretary of this
corporation has executed these Articles of Amendment this 12th day of May,
1999.
/s/ Thomas J. Taule
--------------------------------------
Thomas J. Taule, President and
Secretary
STATE OF FLORIDA )
) ss:
COUNTY OF DADE )
The foregoing instrument was acknowledged before me the day and year
last above written by Thomas J. Taule, President and Secretary, of the
above-named Florida corporation, on behalf of the corporation.
/s/ David M. Glassberg
--------------------------------------
Notary Public, State of Florida
My Commission expires:
David M. Glassberg
[SEAL] MY COMMISSION #CC770028 EXPIRES
December 25, 2002
BONDED THRU TROY FAIN INSURANCE, INC.
5
<PAGE> 1
EXHIBIT 2(C)
BYLAWS OF COORDINATED PHYSICIAN SERVICES, INC.
ARTICLE ONE
SHARE CERTIFICATES
1.1 SHARE CERTIFICATES. Share certificates shall be issued in
consecutive order and shall be numbered in the order in which they are issued.
They shall be signed by the President and the Secretary, and the seal of the
corporation or a facsimile thereof shall be affixed thereto. On the stub of each
share certificate, which stubs shall be kept in the books of the corporation,
shall be entered the name and address of the person owning the shares, the
number of shares, and the date of issue. Each share certificate exchanged or
returned shall be canceled by the Secretary and placed with its stub in the
books of the corporation.
1.2 SHAREHOLDER RECORDS; TRANSFER OF SHARES. Transfers of shares of
the corporation shall be made on the books of the corporation only by the
direction of the person named in the certificate or by his attorney lawfully
constituted in writing, and upon surrender of the certificates or certificates
for such shares properly endorsed. The corporation shall maintain at its
principal place of business or registered office, a record of the names and
addresses of its shareholders and the number of shares held by each.
1.3 LOST, STOLEN, OR DESTROYED CERTIFICATES. If the shareholder will
claim to have lost or destroyed a stock certificate representing shares issued
and recorded by the corporation, a new certificate will be issued upon said
shareholder presenting an affidavit claiming the certificate of stock was lost,
stolen or destroyed. At the discretion of the Board of Directors, said
shareholder will deposit a bond or other indemnity in such amount and with such
sureties, if any, as the Board may require.
ARTICLE TWO
SHAREHOLDERS' MEETING
2.1 ANNUAL MEETING OF SHAREHOLDERS. The annual meeting of
shareholders of the corporation shall be held during the first four months after
the end of each fiscal year of the corporation and at such time and place,
within or without the State of Florida, as may from time to time be fixed by the
Board of Directors; provided that failure to hold the annual meeting shall not
work a forfeiture or affect otherwise valid corporate acts.
1
<PAGE> 2
2.2 SPECIAL MEETING OF SHAREHOLDERS. Special meetings of the shareholders
may be called at any time by the Board of Directors, the Chairman of the Board,
if any, the President, or any holder or holders of as much as 10 percent of all
shares of the corporation entitled to vote at the meeting. Special meetings of
the shareholders shall be held at such time and place, within or without the
state of Florida, as may be determined by the person or persons calling the
meeting.
2.3 NOTICE. The Secretary or an Assistant Secretary or the officer or
persons calling the meeting shall deliver a written notice of the place, day
and time of all meetings of shareholders, not less than 10 nor more than 60
days before the date of the meeting, either personally or by first class mail,
to each shareholder of record entitled to vote at such meeting. If mailed,
such notice shall be deemed to be delivered when deposited in the United States
mail with first class postage thereon prepaid, addressed to the shareholder at
his address as it appears on the share transfer records of the corporation. The
notice of any special meeting of shareholders shall state the purpose or
purposes for which the meeting is called. Notice of any meeting of shareholders
need not be given to any shareholder who signs a waiver of notice, either
before or after the meeting. Attendance of a shareholder at a meeting, either
in person or by proxy, shall of itself constitute waiver of notice of such
meeting and waiver of any and all objections to the place of the meeting, the
time of the meeting, or the manner in which it has been called or convened,
except when a shareholder attends a meeting 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.
2.4 VOTING, PRESIDING OFFICER. At all meetings of the shareholders each
holder of shares of the corporation shall be entitled to cast one vote, either
in person or by written proxy, for each share outstanding in his name on the
books of the corporation. The Chairman of the Board, or if there is no such
officer, the President, shall preside at all meetings of the shareholders,
unless he delegates such authority.
2.5 QUORUM; ADJOURNMENT. At all meetings of shareholders a majority of the
shares of the corporation entitled to vote, represented in person or by proxy,
shall constitute a quorum for the transaction of business, and, except as
otherwise required by law, all resolutions adopted and business transacted
shall require the affirmative vote of a majority of the shares represented at
the meeting and entitled to vote. The holders of a majority of the shares
represented at a meeting, whether or not a quorum is present, may adjourn such
meeting from time to time.
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<PAGE> 3
2.6 SHAREHOLDER ACTION WITHOUT A MEETING. Any action required to be
taken at a meeting of the shareholders of the corporation, or any action that
may be taken at a meeting of the shareholders, may be taken without a meeting,
without prior notice and without a vote, if a consent in writing setting forth
the action so taken shall be signed by holders of outstanding stock having not
less than the minimum number of votes that would be necessary to authorize or
take such action at a meeting at which all shares entitled to vote thereon were
present and voted. Within 30 days after obtaining such authorization by written
consent, notice shall be given to those shareholders who have not consented in
writing, fairly summarizing the material features of the authorized action and
in compliance with applicable law.
ARTICLE THREE
DIRECTORS
3.1 POWER OF THE BOARD. Subject to these bylaws, or any lawful
agreement between the shareholders, the full and entire management of the
affairs and business of the corporation shall be vested in the Board of
Directors, which shall have and may exercise all of the powers that may be
exercised or performed by the corporation.
3.2 NUMBER OF DIRECTORS; CONDUCT OF MEETING. The Board of Directors
shall consist of at least one (1) member. Each member of the Board of
Directors shall be elected at an annual meeting of the shareholders and serve
for a term of one year and until his successor is elected and qualified, or
until his earlier death, resignation or removal. A majority of said directors
shall constitute a quorum for the transaction of business at any meeting of the
Board of Directors. Except as otherwise provided in these bylaws, all
resolutions adopted and all business transacted by the Board of Directors shall
require the affirmative vote of a majority of the directors present at the
meeting. The Chairman of the Board, or if there is not Chairman of the Board
then the President, if he is a director, shall preside at all meetings of the
Board of Directors, unless he delegates such authority. If there is no Chairman
of the Board and the President is not a director, the directors shall select a
chairman for each meeting from their members.
3.3 VACANCIES. Any vacancy occurring in the Board of Directors by
reason of death, resignation or incapacity to serve may be filled by the
affirmative vote of a majority of the remaining directors though less than a
quorum of the Board of Directors, or by the sole remaining director, as the
case may be, or, if the vacancy is not so filled, or if no director remains, by
the shareholders. The directors may fill a vacancy created by an increase in
the number of directors resulting from an amendment of
3
<PAGE> 4
section 3.2 of these bylaws pursuant to Section 7.1 of these bylaws, but only
for a term of office continuing until the next annual election of directors by
the shareholders and the election of qualification of his successor.
3.4 MEETING OF THE BOARD OF DIRECTORS; NOTICE. The directors shall
meet annually immediately following the annual meeting of the shareholders;
provided that the failure to hold the annual meeting shall not work a forfeiture
or affect otherwise valid corporate acts. Special meetings of the directors may
be called at any time by the President, the Chairman of the Board, if any, or by
any two directors, on five days' notice, which may be given personally or by
first class mail, telegram or cablegram and shall be deemed given when mailed or
when the telegram or cablegram is sent, addressed to the director at his address
as it appears on the share records of the corporation or, if he is not a
shareholder, to his business address. Notice of any such meeting may be waived
by an instrument in writing. Attendance of a director at a meeting shall
constitute a waiver of notice of such meeting and waiver of any and all
objections to the place of the meeting, the time of the meeting, or the manner
in which it has been called or convened, except when a director states, at the
beginning of the meeting, any such objection or objections to the transaction of
business. Any meeting of the Board of Directors may be held within or without
the state of Florida at such place as may be determined by the person or persons
calling the meeting.
3.5 DIRECTOR ACTION WITHOUT A MEETING. Any action required to be
taken at a meeting of the directors, or any action that may be taken at a
meeting of the directors, may be taken without a meeting if a consent in
writing, setting forth the action so to be taken, signed by all the directors is
filed with the minutes of the proceedings of the directors.
3.6 REMOVAL OF DIRECTORS. Any one or more directors may be removed
at any meeting of shareholders by the affirmative vote of the holders of a
majority of the shares of the corporation entitled to vote at an election of
directors.
ARTICLE FOUR
OFFICERS
4.1 OFFICER; ELECTION. The Board of Directors shall elect a
President, a Secretary and a Treasurer and may elect a Chairman of the Board,
one or more Vice Presidents, or assistant officers. Any two or more offices may
be held by the same person.
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<PAGE> 5
4.2 CHAIRMAN OF THE BOARD. The Board of Directors may elect from its
members a Chairman of the Board, who shall preside at all meetings of the Board
of Directors and shareholders as provided herein. The Chairman of the Board
shall be the chief executive officer of the corporation and shall have the
authority to execute bonds, mortgages or other contracts under the seal of the
corporation. The Chairman of the Board shall perform such other duties as may
be prescribed by the Board of Directors.
4.3 PRESIDENT. The President shall be responsible for administration of
the affairs of the corporation, including general supervision of the policies of
the corporation and general and active management of the financial affairs of
the corporation. He shall have the authority to execute bonds, mortgages or
other contracts or agreements under the seal of the corporation. If the Board of
Directors shall not have elected a Chairman of the Board, or if the Chairman of
the Board is not available to serve, the President shall preside at all meetings
of the shareholders and, if he is a director, at all meetings of the Board of
Directors of the corporation. The President shall have the authority to
institute or defend legal proceedings when the directors are deadlocked.
4.4 SECRETARY. The Secretary shall keep minutes of all meetings of the
shareholders and directors and have charge of the minute books, share books
and seal of the corporation and shall perform such other duties and have such
other powers as may from time to time be delegated to him by the President or
the Board of Directors.
4.5 TREASURER. The Treasurer shall be charged with the management of
the financial affairs of the corporation. He shall in general perform all of
the duties incident to the office of treasurer and such other duties as may
from time to time be assigned to him by the President or the Board of
Directors.
4.6 VICE PRESIDENTS. The Vice Presidents, if any, shall perform such
duties as are generally performed by vice presidents with equivalent
restrictions on title, if any, and shall perform such other duties and exercise
such other powers as the President or majority of the Board of Directors shall
request or delegate. In the absence of the President or in the event of his
death or inability to act, the Vice President shall perform the duties of the
President, and when so acting, shall have all the powers of and be subject to
all the restrictions upon the President; provided, however, that if there is
more than one Vice President, any Vice President shall have the authority to
execute bonds, mortgages or other contracts or agreements under the seal of
the corporation, subject to all the restrictions upon the president relating
to such functions, but all other duties of the President shall be performed
by the Vice President designated at the time of his election, or in the
absence of any designation, then in order of election (or if
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<PAGE> 6
more than one Vice President is elected at the same meeting, in the order in
which they are listed in the resolution electing them), and when so acting
shall have all the powers of and be subject to all the restrictions upon the
President.
4.7 OTHER OFFICERS. The Board of Directors, or the President, may
appoint such other officers, assistant officers and agents as the Board of
Directors or the President may determine. Any Vice President so appointed shall
perform such duties as are generally performed by elected Vice Presidents with
equivalent restrictions on title, if any. Any other officers or assistant
officers so appointed shall perform such duties as are generally performed by
the elected officers or assistant officers having the same title.
4.8 REMOVAL OF OFFICERS. Any officer, assistant officer or agent
elected or appointed by the Board of Directors may be removed by the Board
whenever in its judgement the best interests of the corporation will be served
thereby. Any officer or assistant officer appointed by the President may be
removed by the President or the Board of Directors whenever in his or its
judgement the best interests of the corporation will be served thereby.
4.9 VACANCIES. Any vacancy, however occurring, in any office may be
filled by the Board of Directors.
ARTICLE FIVE
SEAL
5.1 SEAL. The seal of the corporation shall be in such form as the
Board of Directors may from time to time determine. In the event it is
inconvenient to use such a seal at any time, the words "Corporate Seal" or the
word "Seal" in parentheses or scroll accompanying the signature of an officer
signing for and on behalf of the corporation shall be the seal of the
corporation. The seal shall be in the custody of the Secretary and affixed by
him on the share certificates and such other papers as may be directed by law,
by these bylaws or by the Board of Directors.
ARTICLE SIX
BOOKS AND RECORDS
6.1 BOOKS AND RECORDS. The corporate shall keep accurate and
complete books, records of account, and minutes of the proceedings of all
meetings of shareholders, Board of Directors, committees of directors. Any
books, records and minutes may be in written form or in any other form capable
of being converted into written form.
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<PAGE> 7
6.2 SHAREHOLDER'S INSPECTION RIGHTS. Any person who has been or
presently is a holder of record of shares or of voting trust certificates at
least six months immediately preceding his demand or owns at least five percent
of the outstanding shares of the corporation, upon written demand stating the
purpose thereof, will have the right to examine and to make extracts in person
or by agent or attorney, at any reasonable time(s), for any proper purpose, the
corporation's relevant books, records of accounts, minutes and records of
shareholders.
6.3 FINANCIAL INFORMATION. Not later than four months after the
close of each fiscal year, this corporation will prepare a balance sheet showing
the financial condition of the corporation at the close of the fiscal year, and
a profit and loss statement showing the results of the operations of the
corporation during the fiscal year. Upon the written request of any shareholder
or holder of voting trust certificates for shares of the corporation, the
corporation will mail to each shareholder or holder of voting trust certificates
a copy of the most recent such balance sheet and profit and loss statement. The
balance sheet and profit and loss statement will be filed in the registered
office of the corporation in this state, will be kept for at least five years,
and will be subject to inspection during business hours by any shareholder or
holder of voting trust certificates, in person or by agent.
ARTICLE SEVEN
DIVIDENDS
7.1 DIVIDENDS. The Board of Directors of this corporation may, from
time to time declare dividends on its shares in cash, property or its own
shares, except when the corporation is insolvent or when the payment thereof
would render the corporation insolvent, subject to the provisions of the Florida
Statutes.
ARTICLE EIGHT
INDEMNIFICATION AND INSURANCE
8.1 INDEMNIFICATION AND INSURANCE. Each person who is or was a
director, officer, or employee of the corporation (including the heirs,
executors, administrators or estate of such person), or is or was serving at the
request of the corporation as director, officer, or employee of another
corporation, partnership, joint venture, trust or other enterprise, shall be
indemnified by the corporation as of right to the full extent permitted or
authorized by the present and future laws of the state of Florida against any
liability, cost, payment or expense asserted against, or paid or incurred by,
him in his capacity as such director, officer, or employee. The corporation may
purchase and maintain insurance at
7
<PAGE> 8
its expense, to protect itself and any such person against any such liability,
cost, payment or expense whether or not the corporation would have the power to
indemnify such person against such liability. The foregoing right of
indemnification shall not be deemed exclusive of any other right to which those
indemnified or seeking indemnification may be entitled both as to action in
their official capacities and as to action in another capacity while holding
such offices, and the corporation may provide additional rights to its
directors, officers, or employees.
ARTICLE NINE
AMENDMENT
9.1 AMENDMENT. These bylaws may be amended at any meeting of the
shareholders by the affirmative vote of a majority of the issued and outstanding
shares of the corporation, or at any meeting of the directors of the corporation
by an affirmative vote of a majority of all directors then holding office.
8
<PAGE> 1
EXHIBIT 6(a)
INVESTMENT LETTER
SJI Group, Inc.
Gentlemen:
SJI Group, Inc. ("SJI"), is the owner of an aggregate of 1,000,000
shares of Series __ Preferred Stock (the "Shares") of Isleuth.com, Inc., a
Florida corporation (the "Company") which shares have not been registered under
the Securities Act of 1933, as amended (the "Act") or the securities laws of
any state. The designation rights of the preferred stock are attached hereto as
exhibit "A". The undersigned, Techlabs, Inc. (the "Purchaser or its Agent") is
purchasing the Shares from SJI Group, Inc. for $600,000.00 (the "Transfer").
In order to induce SJI to consummate the Transfer, the Purchaser
represents and warrants to SJI as follows:
(i)the Shares are being acquired by the Purchaser for the account of
the Purchaser and for investment and not with a view to the public resale or
distribution thereof;
(ii) the Purchaser will not sell, transfer or otherwise dispose of the
Shares except in compliance with the Act and applicable state securities laws;
(iii) the Purchaser is aware that the Shares are "restricted
securities" as that term is defined in Rule 144 of the General Rules and
Regulations under the Act;
(vi) the Purchaser has completed an extensive due diligence review of
the Company and its financial statements and as such has obtained all
information it deems necessary to make an informed investment decision
regarding the acquisition of the Shares; and
(v) the Purchaser represents that it is an Accredited or Sophisticated
Investor as such terms are defined in the Act or the rules and regulations
promulgated thereunder.
By reason of the Purchaser's knowledge and experience in financial and
business matters in general, and investments in particular, the Purchaser is
capable of evaluating the merits and risks of acquiring the Shares. The
Purchaser is capable of bearing the economic risks which may be posed by the
Transfer and fully understands the speculative nature of the Shares and the
possibility of such loss.
The Purchaser's present financial condition is such that it is under
no present or contemplated future need to dispose of any portion of the Shares
to satisfy any existing or contemplated undertaking, need or indebtedness.
Neither SJI Group, Inc., nor its officers, directors, affiliates or
employees has made any representations or warranties to the undersigned with
respect to the Company or rendered any investment advice regarding the value of
the Shares or otherwise.
SJI Group, Inc. THE PURCHASER:
Techlabs, Inc.
- ------------------------ -----------------------
By: By:
--------------------- --------------------
Date: April 26, 1999 Date: 4/27/99, 1999
---------- ---------
<PAGE> 1
EXHIBIT 22
<TABLE>
<CAPTION>
Subsidiaries
- ------------
Percentage
----------
Name Owned
---- -----
<S> <C> <C>
Interplanner.Com, Inc.,
(a Florida corporation) 100%
Tech Capital, Inc.
(a Florida corporation) 100%
Tech Investments, Inc.
(a Florida corporation) 100%
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-01-1999
<PERIOD-END> MAR-31-1999
<CASH> 127,325
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 137,325
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 137,325
<CURRENT-LIABILITIES> 1,500
<BONDS> 0
0
9,000
<COMMON> 3,100
<OTHER-SE> 167,400
<TOTAL-LIABILITY-AND-EQUITY> 137,235
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 43,765
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (43,765)
<INCOME-TAX> 0
<INCOME-CONTINUING> (43,765)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (43,765)
<EPS-BASIC> (.04)
<EPS-DILUTED> (.04)
</TABLE>
