SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-SB
GENERAL FORM FOR REGISTRATION OF SECURITIES
OF SMALL BUSINESS ISSUERS
Under Section 12(b) or 12(g) of
The Securities Exchange Act of 1934
CardStakes.com
(Exact name of registrant as specified in its charter)
NEVADA 91-1963840
(State or other jurisdiction (I.R.S. Employer Identification No.)
of incorporation or organization)
1288 Alberni Street, Suite 806, Vancouver, British Columbia V6E 4N5
(Address of registrant's principal executive offices) (Zip Code)
604.664.0484
(Registrant's Telephone Number, Including Area Code)
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, Par value $.0001
(Title of Class)
Copies to:
Thomas E. Stepp, Jr.
Stepp & Beauchamp LLP
Attorneys-at-Law
1301 Dove Street, Suite 460
Newport Beach, California 92660
949.660.9700
Facsimile 949.660.9010
Page 1 of 14
Exhibit Index is specified on Page 13
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CardStakes.com,
a Nevada corporation
Index to Form 10-SB Registration Statement
Item Number and Caption Page
- ----------------------- ----
1. Description of Business 3
2. Management's Discussion and Analysis of Financial Condition
and Results of Operations 8
3. Description of Property 9
4. Security Ownership of Certain Beneficial Owners and Management 9
5. Directors, Executive Officers, Promoters and Control Persons 9
6. Executive Compensation - Remuneration of Directors and Officers 10
7. Certain Relationships and Related Transactions 11
8. Legal Proceedings 11
9. Market For Common Equity and Related Shareholder Matters 11
10. Recent Sales of Unregistered Securities 11
11. Description of Securities 12
12. Indemnification of Officers and Directors 12
13. Financial Statements 12
14. Changes in and Disagreements with Accountants 13
15. Financial Statements and Exhibits
15(a) Index to Financial Statements 13
Financial Statements F-1 through F-7
15(b) Index to Exhibits 13
Exhibits E-1 through E-31
Signatures 14
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Item 1. Description of Business.
CardStakes.com (the "Company") was incorporated as Power Direct Tech.com in
the State of Nevada on February 19, 1999, and is a 51%-owned subsidiary of Power
Direct, Inc., a Delaware corporation ("Power Direct"). On or about February 23,
1999, the Company changed its name to PDTech.com. On or about June 8, 1999, the
Company changed its name to CardStakes.com. The Company maintains its principal
executive offices at 1288 Alberni Street, Suite 806, Vancouver, BC V6E 4N5. The
Company's offices in the United States are located at 4291 Meridian Street,
Suite 48, Bellingham, Washington 98226. The telephone number of the Company in
Vancouver, British Columbia is 604.664.0484.
The Company anticipates it will acquire interests in Internet companies and
related technology. On or about April 28, 1999, Power Direct entered into a
licensing agreement ("Licensing Agreement") with Compte De Sierge Accomodative
Corp. doing business using the fictitious business name E-Card Gaming Systems,
Inc., a corporation incorporated in Panama City, Panama ("E-Card"). The
agreement specifies, among other things, that Power Direct will have the
worldwide right to utilize and commercially exploit certain gaming software
systems and related proprietary technology relating to the operation of the
Greeting Card Lotto, a lottery conducted over the Internet. The Company
anticipates acquiring Power Direct's rights, title and interest under the
Licensing Agreement. In the alternative, the Licensing Agreement provides that
Power Direct may grant sublicenses to third parties with new terms agreeable to
E-Card with respect to the proprietary technology. The Company may become such a
third party licensee.
The Licensing Agreement also provides that three equal cash payments of
CDN$100,000 are to be paid to E-Card by Power Direct as partial consideration
pursuant to the Licensing Agreement. The first such payment was due upon
execution of the Licensing Agreement; the second payment is due upon completion
of the first phase of testing; and the third payment is due upon completion of
the second phase of testing. The Licensing Agreement also provides that Power
Direct shall issue 6,000,000 shares of its $.0001 par value common stock in two
separate issuance transactions, each of 3,000,000 shares. The first such
transaction was to occur upon execution of the Licensing Agreement, and the
second such transaction shall occur upon the commencement of operations of the
Greeting Card Lotto, as specified in the Licensing Agreement. As of May 13,
1999, Power Direct had paid CDN$100,000 under the Licensing Agreement. Those
6,000,000 shares shall be "restricted securities" subject to the limitations and
restrictions regarding resale and distribution specified by Rule 144. There can
be no assurance that either Power Direct or the Company will have the ability to
make further payments due pursuant to the Licensing Agreement in a timely
manner, or at all.
On or about May 5, 1999, Power Direct entered into an Asset Purchase
Agreement with On-line Asset Courtesy Inc., a corporation incorporated in Panama
City, Panama ("On-line") pursuant to which Power Direct agreed to purchase from
On-Line, and On-line agreed to sell, an Universal Resource Locator (URL)
registered as "GREETINGCARDLOTTO.COM", as well as associated URLs registered as
"E-CARDLOTTO.COM" and "CARDLOTTO.COM". An URL is the address of a page on the
World Wide Web. Every web page has an URL that identifies it uniquely, and which
provides enough information for any computer connected to the Internet to locate
it. In exchange for the three (3) URLs, Power Direct agreed to issue to On-line
two million (2,000,000) warrants to purchase Power Direct' $.0001 par value for
a price of US$0.25 each. The warrants are exercisable for a point of two (2)
years from the date of issuance and all common stock purchased pursuant to those
warrants will be "restricted securities" subject to the limitations and
restrictions regarding resale and distribution specified by Rule 144. The
Company anticipates acquiring Power Direct's rights, title and interest under
the Asset Purchase Agreement.
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The Online Gambling Industry. Internet gambling sites may generate an
estimated US $651 million in revenue in 1999 according to economist Sebastian
Sinclair of the New York firm Christiansen, Cummings and Associates. The
anticipation of such revenue may be a reason that the National Collegiate
Athletic Association, the National Football League, and various state attorneys
general are attempting to prevent online wagering.
The Interactive Gaming Council ("IGC") is a trade association for the
international interactive gaming industry, comprised of Internet gambling
operators who are attempting to establish industry guidelines that could become
the international standard for Internet gambling operations. Its members operate
or supply services to many of the 280 interactive gaming and wagering sites on
the World Wide Web. The IGC is considering a common database to share fraudulent
account information.
A significant number of states and the federal government have proposed
action making Internet gambling, including Internet lottery operations illegal.
Additionally, there are other jurisdictions where online gambling activities are
prohibited. As a result, the Company will take the necessary steps to ensure
that residences of any jurisdiction where participation in Internet gambling is
illegal, including the United States, do not have access to Internet gambling.
The Nevada Gaming Commission, which opposes Internet gambling, has licensed
a slot-machine manufacturer to test a system that allows Nevada residents to
make sports bets from home computers. The system traces phone calls so operators
know exactly where those calls originated. Before entering the Intranet, whose
dial-up access is restricted to subscribers, customers have to go to a Nevada
sports book and open an account.
The Company intends to utilize a system similar to that used in Nevada to
screen and prevent residents of those jurisdictions which prohibit online gaming
operations to participate in the Company's Internet lottery operations.
Possible Adverse Legislation. Approximately 25 countries are currently
regulating, and taxing, Internet gambling operations. The regulation of Internet
gambling operations in the United States is currently uncertain. On August 3,
1996, President Clinton signed a bill creating a nine-member National Gambling
Impact Study Commission to study the economic and social impact of gambling and
report its findings to Congress and the President. The Commission could
recommend changes in state or federal gaming policies. The President, House
Speaker and Senate Majority Leader each selected three of the Commission's
members. Additional federal regulation of the gaming industry could occur as a
result of investigations or hearings by the Commission, which could have a
material adverse effect on the Company. The Commission last met in Washington,
D.C. on April 27 and April 28, 1999, and continued its deliberations regarding
its Final Report which is presently scheduled to be released to the President,
Congress, state governors, Native American tribal leaders, and the public on
June 18, 1999.
Senator Jon Kyl (R-Ariz.), Congress' foremost opponent of online betting,
is reintroducing a revised proposal to amend the federal Wire Communications Act
of 1961 ("Wire Act") prohibitions on interstate sports gambling conducted by
telephone or wire to cover newer technological transmissions, including the
Internet. The proposal would extend the law to prohibit some newer forms of
gambling, including those offered by an estimated 300 sports betting and
"cybercasinos" that now exist. The new Internet Gambling Prohibition Act allows
for the continuation of all forms of gambling that are currently legal and also
limits the liability of Internet access providers. Such providers do not have to
do anything that is "technologically infeasible" or "unduly burdensome" to
restrict Internet gambling sites. Senator Kyl believes that more than
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a billion dollars will be gambled on the Internet in 1999. Senator Kyl also
believes that Internet gambling is addictive, accessible to minors, subject to
fraud and other criminal use, evasive of state gambling laws and already illegal
at the federal level in many cases. Senator Kyl's proposal intends to prohibit
most types of online gambling on a federal level, and provides for three months
in prison and $1,500 in fines, or three times the amount of the wager, for
bettors caught in the act. Last year's version of Senator Kyl's proposal passed
the Senate 90-10 but died in the House. Senator Kyl predicts that Internet-based
gambling receipts could total an estimated $100 billion by 2006. This year's
version of Senator Kyl's is being looked at by the Senate. In June of 1999, the
Senate Judiciary Committee voted 16-1 to approve Kyl's bill. The bill next goes
to a vote on the Senate floor. The current version of Senator Kyl's bill would
make it illegal to bet online in all 50 states.
Reps. Bob Goodlatte (R-Va.) and Frank LoBiondo (R-N.J.) are resurrecting
their online gambling proposal in the House of Representatives from a previous
Congressional session, but the proposal will not mirror Senator Kyl's proposal.
The House proposal will not take on the issue of fantasy sports, merely games of
chance; moreover, it will not totally prohibit online gambling on a federal
level. Instead, the House measure will allow states to decide their own online
gambling policies.
Possible Adverse Litigation. Several state court lawsuits might result in
case law adverse to the Company's operations in the United States. In March,
1999, Cynthia Haines, a California woman who gambled away more than $70,000 on
the Internet to more than 50 cybercasinos sued her credit issuer, Providian
National Bank, in Marin County Superior Court. She alleged that credit card
companies are engaging in unfair business practices and aiding and abetting a
crime by giving online wager house merchant accounts to process bets for
customers who live where such betting activity is illegal.
Possible Law Enforcement Action. Alan Kesner, Wisconsin's Assistant
Attorney General and the Chairman of the Internet Gambling Committee for the
National Association of Attorneys General, recognized the difficulty of
eliminating Internet gambling, but many state attorneys general continue to
challenge the legality of Internet gambling within the borders of their
respective states. For example, the Attorney General for the State of Minnesota
has claimed that, because gambling is illegal in Minnesota, users there cannot
place bets through a server located elsewhere (in one case, the web page
advertiser was located in Nevada and the server processing the bet was located
in Belize).
In March, 1998 the Federal Bureau of Investigation's Computer Crisis squad
charged Jay Cohen and 19 other owners and managers of offshore companies with
illegally using interstate telephone lines to accept online wagers and accept
money from United States customers in violation of the Wire Act, a law designed
to stop organized crime's illegal bookmaking activities. To date, Mr. Cohen and
one other person have been indicted, three persons have agreed to plea bargains,
and four persons refused to return to the United States. For the rest,
indictments are pending. Mr. Cohen's website was started in Antigua in 1996,
where Internet gambling is legal.
Competition. Competition in the gambling industry is significant. Certain
of the Company's competitors have more experienced management and greater name
recognition, marketing capabilities and financial resources than the Company.
The Company may also encounter increasing competition from the new and existing
Internet lottery operations developed and promoted both by casinos and by
Internet gaming industry companies in certain jurisdictions throughout the
United States and abroad. The Company may also encounter indirect competition
from other forms of lawful gambling, such as state-sponsored lotteries and video
lottery terminals, pari-mutuel betting on horse and dog racing and bingo
parlors, as well as from other
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forms of entertainment. It is possible that increased competition could have a
material adverse effect on the Company. Many of these competitors have greater
financial and other resources, and more experience in the gambling industry,
than the Company. There can be no assurance that competitors have not or will
not succeed in developing technologies that are more effective than any which
have been or are being developed by the Company or which would render the
Internet lottery operations of the Company obsolete and noncompetitive.
The Company will encounter competition from hundreds of Internet gambling
companies, including companies that specialize in Internet lotteries. Lotteries
have become a $100 billion per year industry. GTECH, traded on the New York
Stock Exchange under the trading symbol "GTK", is reputedly the world's leading
supplier of computerized online lottery products and services, and supplies or
operates approximately 29 United States lottery systems and 51 foreign lottery
systems. GTECH announced a contract in February, 1999 to provide online lottery
products and services to the Idaho State Lottery, including the central system
hardware, software and terminals. In March, 1999, GTECH announced that it had
signed a new contract to provide online lottery products and services to Loteria
Electronica de Puerto Rico. Another competitor, Plus Lotto, was one of the first
operating gaming sites on the Internet. It is an Internet lottery run by the
Liechtenstein Foundation, and donates 25% of its profits to the International
Red Cross. Games available include conventional weekly and hourly lotteries as
well as instant and interactive games such as Bingo and Scratch-Offs.
The Company will also encounter competition from other types of online
gambling by well-established companies. The approximately 55 offshore gaming
operators who comprise the IGC are all direct competitors of the Company. Inland
Entertainment is a publicly-traded company based in San Diego, California and
was previously a leader in the Native American gaming industry. Inland
Entertainment has since diversified by launching several online casinos,
including Casino Australia, The Good Luck Club, and the Kenny Rogers Casino. You
Bet! International is a Los Angeles-based interactive technology company that
provides horse players instant access to live racing, information and wagering
on a secure, proprietary private network. The service is multilingual and
multicurrency. American Wagering, Inc., traded on NASDAQ under the trading
symbol "BETM" has a gambling license in Nevada and has begun accepting wagers on
the Internet from its Australian website, having received approval and licensing
by Australian regulatory authorities.
Dependence Upon Single Type of Gambling Operation. The Company does not
currently anticipate having operations other than its Internet lottery
operations and, therefore, will be entirely dependent upon Internet lottery
revenues. Because the Company may be entirely dependent on a single gaming type
of operation for its revenues, it will consequently be subject to greater risks
than a more diversified gaming operation.
Taxes and Fees. Gaming companies are typically subject to significant taxes
and fees in addition to normal federal and state corporate income taxes, and
such taxes and fees are subject to increase at any time. Additionally, from time
to time, certain federal legislators have proposed the imposition of a federal
tax on gaming revenues. Any such federal tax or any material increase in
existing taxes or fees would adversely affect the Company.
Possible Need for Additional Financing. The Company anticipates funding
product development and the expansion of sales and marketing activities from
existing cash reserves and cash from operations. In the event that cash from
operations and other available funds are insufficient to fund the Company's
presently anticipated operations, the Company may be required to seek additional
financing. There can be no assurance
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that, if additional financing is required, it will be available on acceptable
terms, or at all. Additional financing may involve substantial dilution to the
interests of the Company's then current shareholders.
Possible Volatility of Stock Price. The trading price of the Company's
common stock may be subject to significant fluctuations. The trading price of
the Company's common stock could be subject to significant fluctuations in the
future, because of factors such as announcements of technological innovations,
new product introductions by the Company, its competitors and other third
parties, quarterly variations in the Company's operating results, and market
conditions in Internet companies generally and in the Internet gaming industry
in particular. In addition, the stock market has experienced volatility that has
particularly affected the market prices of many Internet companies which has
often been unrelated to the operating performance of such companies. These
market fluctuations may adversely affect the market price of the Company's
common stock.
Lack of Internet Gaming Experience. The Company's management has no
experience in the Internet gaming industry. The Company's parent corporation,
Power Direct, recently announced the appointment of Michael R. Wright as
Chairman of the Board of Directors of Power Direct. Mr. Wright has significant
experience in the gaming industry. He specialized in the design, manufacture,
distribution and operation of slot machines for Bally Gaming. He resided in
Prague, Czech Republic, where he operated the National TV Bingo Lottery. As
President and Chief Executive Officer of Border Capital, a Canadian public
company, Mr. Wright directed the development of the software and design of
television game shows for the global lottery industry. There can be no assurance
that the Company will benefit, directly or indirectly, from Mr. Wright's
experience in the gaming industry.
Business Interruption; Reliance on Computer and Telecommunications
Infrastructure. The Company's success will be dependent in large part on its
continued investment in sophisticated telecommunications and computer systems
and computer software. The Company anticipates making significant investments in
the acquisition, development, and maintenance of such technologies in an effort
to remain competitive and anticipates that such expenditures will be necessary
on an on-going basis. Moreover, computer and telecommunication technologies are
evolving rapidly and are characterized by short product lifecycles, which
requires the Company to anticipate technological developments. There can be no
assurance that the Company will be successful in anticipating, managing or
adopting such technological changes on a timely basis or that the Company will
have the financial resources available to invest in new technologies. In
addition, the Company's business is highly dependent on its computer and
telecommunications equipment and software systems, the temporary or permanent
loss of which, through physical damage or operating malfunction, could have a
material adverse effect on the Company's business. Although the Company does not
anticipate any problems with its computer software relating to the year 2000,
operating malfunctions in the software systems of financial institutions and
other parties might have an adverse affect on the operations of the Company. The
Company's business is materially dependent on service provided by various local
and long distance telephone companies. A significant increase in the cost of
telephone services that is not recoverable through an increase in the price of
the Company's services, or any significant interruption in telephone services,
could have a material adverse effect on the Company.
Management of Growth; Dependence on Key Personnel. The Company's success in
the future is dependent upon its ability to grow rapidly and effectively manage
growth. Such growth, if any, will require increased managerial, technical,
Internet marketing, and other personnel, expanded information systems and
additional financial and administrative control procedures. Expansion of the
Company's indirect and direct marketing resources will require significant
financial and managerial commitments by the Company. There can be no assurance
that the Company will be able to manage such growth effectively, if at all. The
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Company's failure to do so would have a material adverse effect on its business,
operating results, and financial condition. Competition for qualified technical,
marketing, and other qualified personnel is significant, and there can be no
assurance that the Company will be able to attract or retain highly qualified
employees in the future. The Company's future success also depends in part upon
the continued service of its key technical, marketing and senior management
personnel. The loss of the services of one or more of these key employees could
have a material adverse effect on the Company's business, operating results, and
financial condition.
Employees. The Company currently has 2 part-time employees and 2 full-time
employees. None of the Company's employees are subject to any collective
bargaining agreements. Each employee of the Company will be required, as a
condition of employment, to execute an agreement not to disclose the Company's
trade secrets or other confidential information.
Reports to Security Holders. The Company intends to provide an annual
report to its security holders, which will include audited financial statements.
The Company will become a reporting company when this registration statement
becomes effective with the Securities and Exchange Commission ("SEC"). After the
Company becomes a reporting company with the SEC, the public may read and copy
any materials filed with the SEC at the SEC's Public Reference Room at 450 Fifth
Street N.W., Washington, D.C. 20549. The public may also obtain information on
the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330.
The SEC maintains an Internet site that contains reports, proxy and information
statements, and other information regarding issuers that file electronically
with the SEC. The address of that site is http://www.sec.gov.
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations
This report includes a number of forward-looking statements which indicate
the Company's current expectations with respect to future events and financial
performance. Forward looking statements can be identified by the use of
forward-looking terminology such as "believes", "anticipates", "estimates",
"projects", "expects", "may", "will", or "should" or the negative thereof or
other variations thereon or comparable terminology. Such statements are subject
to certain risks, uncertainties and assumptions. No assurances can be given that
the future results anticipated by those forward looking statements will be
achieved. The following matters constitute cautionary statements identifying
important factors with respect to such forward-looking statements, including
certain risks and uncertainties, that could cause actual results to vary
materially from the future results covered in such forward-looking statements.
Other factors could also cause actual results to vary materially from the future
results anticipated in such forward-looking statements. Undue reliance should
not be placed on those forward-looking statements, are based on facts existing
as of the date of this Registration Statement.
Liquidity and Capital Resources. The Company had cash resources of $189,599
at April 30, 1999. The cash and equivalents constitute the Company's present
internal sources of liquidity. The Company's only external source of liquidity
is the sale of its capital stock. On or about March 12, 1999, the Company
commenced an offering of shares of its $.0001 par value common stock in reliance
on an exemption from and prospectus delivery requirements of the Securities Act
of 1933, as amended ("Act"), which exemption is specified by the provisions of
Section 3(b) of the Act and to Rule 504 of Regulation D promulgated pursuant
thereto. As of April 8, 1999, the Company had sold 2,100,000 shares of its
$.0001 par value common stock pursuant to that offering. Gross proceeds from the
offering are $210,000.
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Results of Operations. The Company has not yet realized any significant
revenue from operations, nor does it expect to in the foreseeable future.
Impact of the Year 2000. The Company anticipates that the year 2000
(commonly referred to as "Y2K") could impact the business of the Company. Many
business software applications use only the last two digits to indicate the
applicable year. Unless these programs are modified, computers running
time-sensitive software may be unable to distinguish between the year 1900 and
the year 2000, which would result in computer system failures, miscalculations,
and general disruption of operations, including, among other things, a temporary
inability to process transactions or to engage in other normal business
activities. Many Y2K problems might not be readily apparent when they first
occur, but instead could imperceptibly degrade technology systems and corrupt
information stored in computerized databases, in some cases before January 1,
2000.
The Company has completed a preliminary assessment of each of its
operations and its Y2K readiness and had determined that the appropriate actions
are being taken. The Company does not believe the Y2K issue will result in any
significant problem for the Company's computer systems. The Company recognizes,
however, that the Y2K issue could have a material impact on the operations of
the Company. There is no guarantee that the computer systems of other companies
on which the Company's systems rely will be timely readied for the Year 2000.
Moreover, there can be no guarantee that the Company's suppliers, customers, or
other parties with whom the Company does business will not experience
significant Y2K problems, which might result in an adverse effect on the
Company's operations.
Item 3. Description of Property
Property held by the Company. As of the dates specified in the following
table, the Company held the following property:
================================================================================
Property April 30, 1999 April 30, 1998
- --------------------------------------------------------------------------------
Cash and equivalents $189,599 $0.00
- --------------------------------------------------------------------------------
The Company defines cash equivalents as all highly liquid investments with
a maturity of 3 months or less when purchased. The Company does not presently
own any interests in real estate. The Company does not presently own any
inventory or equipment.
Item 4. Security Ownership of Certain Beneficial Owners and Management
(a) Security Ownership of Certain Beneficial Owners. The Following are
persons, other than directors and officers, who are beneficial owners of 5% or
more of the Company's issued and outstanding common stock:
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Name and Address Amount of Percent of
Title of Class of Beneficial Owner Beneficial Owner Class
- -------------- ------------------- ---------------- -----
Common Stock Power Direct, Inc. 6,605,996 76.0%
1288 Alberni Street, Suite 806
Vancouver, British Columbia
V6E 4N5
(b) Security Ownership of Management. The directors and principal executive
officers of the Company do not own any of the Company's issued and outstanding
capital stock. However, Power Direct, Inc., owns 76% of the total issued and
outstanding common stock of the Company. Jack Sha is the President and a
Director of Power Direct, Inc., as well as the President and a Director of the
Company.
Changes in Control. Management of the Company is not aware of any
arrangements which may result in "changes in control" as that term is defined by
the provisions of Item 403(c) of Regulation S-B.
Item 5. Directors, Executive Officers, Promoters and Control Persons
The directors and principal executive officers of the Company are as
specified on the following table:
================================================================================
Name Age Position
- --------------------------------------------------------------------------------
Jack Sha 48 President and Director
5550 Cambie Street, Suite 306
Vancouver, B.C.
V5Z 3A2
================================================================================
Robert Klein 51 Secretary, Treasurer and Director
1273 West 20th Street
North Vancouver, B.C.
V7P 2B8
================================================================================
Jack Sha is the President and a Director of the Company. Mr. Sha was the
president of Tokyo Trading Ltd. From 1990 through 1994, during which time he was
involved in the decision making process for various investment opportunities,
including golf course developments to mining properties. In 1991, Mr. Sha
acquired, on behalf of the Tokyo Trading Ltd., the rights to develop and market
a unique essence for skin care products. In 1994, Mr. Sha underwent major
surgery and was inactive until 1998.
Robert Klein is the Secretary, Treasurer and a Director of the Company. He
also the President of Rising Phoenix Development Group, Ltd., and recently
resigned from Power Direct, Inc.'s Board of Directors. It is anticipated that
Mr. Klein may again become a member of Power Direct, Inc.'s Board of
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Directors. Mr. Klein's experience includes an active twenty-year career in the
securities, handling a wide range of duties including management roles and
institutional trading. For the past fifteen years, a major emphasis has been
placed on packaging complex transactions on behalf of corporate clients,
resulting in the creation and sale of marketable securities. The past five years
have been spent on public and private companies involved in resource management
and light manufacturing. He has a degree in Applied Mathematics from the
University of Waterloo. Mr. Klein has an FCSI designation from the Canadian
Securities Institute. Mr. Klein has been responsible for strategic planning and
securing funding for a number of start-up ventures, both in Canada and the
United States. None of the above specified individuals share any familial
relationship. Other than the individuals specified above, there are no
significant employees expected by the Company to make a significant contribution
to the business of the Company. All directors of the Company serve until the
next annual meeting of stockholders. The Company's executive officers are
appointed by the Company's Board of Directors and serve at the discretion of the
Company's Board of Directors.
There are no orders, judgments, or decrees of any governmental agency or
administrator, or of any court of competent jurisdiction, revoking or suspending
for cause any license, permit or other authority to engage in the securities
business or in the sale of a particular security or temporarily or permanently
restraining Mr. Sha or Mr. Klein from engaging in or continuing any conduct,
practice or employment in connection with the purchase or sale of securities, or
convicting such person of any felony or misdemeanor involving a security, or any
aspect of the securities business or of theft, nor is Mr. Sha or Mr. Klein the
officers or directors of any corporation or entity so enjoined.
Item 6. Executive Compensation - Remuneration of Directors and Officers.
The officers and directors of the Company received no direct compensation
from the Company during the Company's most recent fiscal year. The officers and
directors of the Company are reimbursed for expenses incurred on behalf of the
Company.
================================================================================
Name of individual or Capacities in which Aggregate
Identity of Group remuneration was received remuneration
- --------------------------------------------------------------------------------
Executive Officers None None
================================================================================
As of May 27, 1999, no compensation has been paid to any of the officers or
directors of the Company. The Company anticipates compensating Jack Sha for
accrued salary in an amount yet to be determined by the Company's Board of
Directors.
Item 7. Certain Relationships and Related Transactions
Ownership of the Company's Common Stock by Power Direct. Power Direct
currently owns 6,605,996 shares of the Company's $.0001 par value common stock.
Power Direct anticipates distribute 2,165,938 shares of the Company's $.0001 par
value common stock as a dividend to Power Direct's shareholders. Power Direct
will retain 4,440,058 common shares of the Company's $.0001 par value common
stock.
Transactions with Promoters. The services of no promoters were used.
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Item 8. Legal Proceedings
There are no legal actions pending against the Company nor are any such
legal actions contemplated.
Item 9. Market For Common Equity and Related Stockholder Matters
The Company anticipates that it will apply for participation in the OTC
Bulletin Board, an electronic quotation system for securities not traded on a
securities exchange. As of May 27, 1999, there were no warrants outstanding to
purchase shares of the Company's $.0001 par value common stock, nor any options
to purchase common stock. The Company has never paid cash dividends and does not
anticipate paying cash dividends in the foreseeable future. The Company
anticipates that it will retain earnings, if any, for future growth and
expansion of its business.
Item 10. Recent Sales of Unregistered Securities
There have been no sales of unregistered securities within the last three
(3) years which would be required to be disclosed pursuant to Item 701 of
Regulation S-B, except for the following:
On or about March 12, 1999, the Company commenced an offering of shares of
its common stock in reliance on an exemption from registration and prospectus
delivery requirements of the Securities Act of 1933, as amended ("Act"), which
exemption's specified by the provisions of Section 3(b) of the Act and Rule 504
of Regulation D promulgated by the Securities and Exchange Commission pursuant
to that Section 3(b). As of May 27, 1999, the Company had sold a total of
2,100,000 shares of its common stock pursuant to that offering. Gross proceeds
from the offering are $210,000.
The offering price for the Company's shares of $.0001 par value common
stock was arbitrarily determined by the Company and had no relationship to
assets, book value, revenues or other established criteria of value. Proceeds
from the offering described in the preceding paragraph were used for, among
other purposes, working capital, including legal fees; office equipment and
office expenses.
Item 11. Description of Securities
The Company is authorized to issue 100,000,000 shares of common stock,
$.0001 par value, each share of common stock having equal rights and
preferences, including voting privileges. As of June 16, 1999, 8,705,996 shares
of the Company's $.0001 par value common stock were issued and outstanding.
The shares of $.0001 par value common stock of the Company constitute
equity interests in the Company entitling each shareholder to a pro rata share
of cash distributions made to shareholders, including dividend payments. The
holders of the Company's common stock are entitled to one vote for each share of
record regarding all matters to be voted on by the Company's shareholders. There
is no cumulative voting with respect to the election of directors of the Company
or any other matter, with the result that the holders of more than 50% of the
shares voted for the election of those directors can elect all of the Directors.
The holders of the Company's common stock are entitled to receive dividends
when, as and if declared by the Company's Board of Directors from funds legally
available therefor; provided, however, that cash dividends are at the sole
discretion of the Company's Board of Directors. In the event of liquidation,
dissolution or winding up of the Company, the holders of common stock are
entitled to share ratably in all assets remaining available for distribution to
them after payment of liabilities of the Company and after provision has been
made for each class of stock, if any, having preference in relation to the
Company's $.0001 par value common stock. Holders of the shares of Company's
$.0001 par value common stock have no conversion, preemptive or other
subscription rights, and
12
<PAGE>
there are no redemption provisions applicable to the Company's $.0001 par value
common stock. All of the outstanding shares of Company's common stock are duly
authorized, validly issued, fully paid and non-assessable.
Item 12. Indemnification of Directors and Officers
Article Twelve of the Company's Articles of Incorporation provides that no
officer or director of the Company shall be personally liable to the Company or
its stockholders for damages for breach of fiduciary duty as an officer or
director, except that Article Twelve does not eliminate or limit the liability
of an officer or director for acts or omissions which involve intentional
misconduct, fraud or a knowing violation of law, or for the payment of dividends
in violation of the Nevada General Corporation law.
The Company contemplates that it may enter into indemnification agreements
with each of its executive officers and directors pursuant to which the Company
agrees to indemnify each such person for all expenses and liabilities, including
criminal monetary judgments, penalties and fines, incurred by such person in
connection with any criminal or civil action brought or threatened against such
person by reason of such person being or having been an officer or employee of
the Company. In order to be entitled to indemnification by the Company, such
person must have acted in good faith and in a manner such person believed to be
in the best interests of the Company and, with respect to criminal actions, such
person must have had no reasonable cause to believe his or her conduct was
unlawful.
IN THE OPINION OF THE SECURITIES AND EXCHANGE COMMISSION, INDEMNIFICATION
FOR LIABILITIES ARISING PURSUANT TO THE SECURITIES ACT OF 1933 IS CONTRARY TO
PUBLIC POLICY AND, THEREFORE, UNENFORCEABLE.
Item 13. Financial Statements.
Copies of the financial statements specified in Regulation 228.310 (Item
310) are filed with this Registration Statement, Form 10-SB (see Item 15 below).
Item 14. Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure
There have been no changes in or disagreements with the Company's
accountants since the formation of the Company required to be disclosed pursuant
to Item 304 of Regulation S-B.
Item 15. Financial Statements and Exhibits
(a) Index to Financial Statements. Page
- ---------------------------------- ----
Independent Auditor's Report F-1
Balance Sheet as of April 30, 1999 F-2
Statement of Operations for the periods ending April 30, 1999 F-3
Statement of Shareholders' Equity for the period ending
April 30, 1999 F-4
13
<PAGE>
Statement of Cash Flows for the period ending April 30, 1999 F-5
Notes to Financial Statements F-6 through F-7
(b) Index to Exhibits.
Copies of the following documents are filed with this Registration
Statement, Form 10-SB as exhibits:
Index to Exhibits Page
- ----------------- ----
1 Corporate Charter of E-1
Power Direct Tech.com
2 Articles of Incorporation of E-2 through E-5
Power Direct Tech.com
(Charter document)
3 Certificate of Amendment to the Articles E-6 through E-7
of Incorporation of Power Direct Tech.com
Authorizing the Name Change to PDTech.com
4 Certificate of Amendment to the Articles of E-8 through E-9
Incorporation Authorizing the Name Change
to CardStakes.com
5 Certificate of Amendment to the Articles of E-10 through E-11
Incorporation of PDTech.com re: Anti-Dilution
6 Bylaws of Power Direct Tech.com E-12 through E-31
14
<PAGE>
SIGNATURES
In accordance with the provisions of Section 12 of the Securities Exchange
Act of 1934, CardStakes.com has duly caused this Registration Statement to be
signed on its behalf by the undersigned, thereunto duly authorized, in the City
of Vancouver, British Columbia, on June ___, 1999.
CardStakes.com,
a Nevada corporation
By: ___________________
Jack Sha
Its: President
15
<PAGE>
James E. Slayton, CPA
- --------------------------------------------------------------------------------
3867 WEST MARKET STREET
SUITE 208
AKRON, OHIO 44333
INDEPENDENT AUDITORS' REPORT
Board of Directors May 14, 1999
PDTech.com (The Company)
Las Vegas, Nevada 89102
I have audited the Balance Sheet of PDTech.com (A Development Stage
Company), as of April 30, 1999, and the related Statements of Operations,
Stockholder Equity and Cash Flows for the period February 19, 1999 (Date of
Inception) to April 30, 1999. These financial statements are the responsibility
of the Company's management. My responsibility is to express an opinion on these
financial statements based on my audit.
I conducted my audit in accordance with generally accepted auditing
standards. Those standards require that I 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 statement presentation. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation I believe that my audit provides a reasonable basis for my opinion.
In my opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of PDTech.com, (A Development
State Company), at April 30, 1999, and the results of its operations and cash
flows for the period February 19, 1999 (Date of Inception) to April 30, 1999, in
conformity with generally accepted accounting principles.
The accompanying financial statements have been prepared assuming the
Company will continue as a going concern. As discussed in Note 3 to the
financial statements, The Company has had limited operations and has not
established a long term source of revenue. This raises substantial doubt about
its ability to continue as a going concern. Management's plan in regard to these
matters are also described in Note 3. The financial statements do not include
any adjustments that might result from the outcome of this uncertainty.
/s/ James E. Slayton
James E. Slayton, CPA
Ohio License ID # 04-1-15582
F-1
<PAGE>
PDTech. com
(A Development Stage Company)
BALANCE SHEET
AS AT
April 30, 1999
ASSETS
CURRENT ASSETS
Cash $189,599.00
Other Current Assets 0.00
-----------
Total Current Assets 189,599.00
-----------
OTHER ASSETS
Organization Costs net of Amortization 1,537.00
-----------
Total Other Assets 1,537.00
-----------
TOTAL ASSETS $191,136.00
===========
LIABILITiES & EQUITY
CURRENT LIABILITIES
Due to Shareholder $ 2,551.00
Total Current Liabilities -----------
2,551.00
EQUITY
Capital Stock 210.00
Additional Paid in Capital 209,790.00
Retained Earnings or (Deficit) (21,415.00)
-----------
Total Stockholders' Equity 188,585.00
TOTAL LIABILITIES & OWNER'S EQUITY $191,136.00
===========
See accompany notes to financial statements & audit report
-2-
F-2
<PAGE>
PDTech.com
(A Development Stage Company)
STATEMENT OF OPERATIONS
FOR PERIOD
February 19, 1999 (Date of Inception) to April 30, 1999
REVENUE
Services 0.00
Interest Income in the course of business 284.00
COSTS AND EXPENSES
Selling, General and Administrative 21,646.00
Amortization of Organization Costs 53.00
-----------
Total Costs and Expenses 21,699.00
Net Ordinary Income or (Loss) (21,415.00)
===========
Weighted average
number of common
shares outstanding 2,100,000
Net Loss
Per Share -0.01
See accompany notes to financial statements & audit report
-3-
F-3
<PAGE>
PDTech.com
(A Development Stage Company)
STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
FOR PERIOD
February 19, 1999 (Date of Inception), to April 30, 1999
<TABLE>
<CAPTION>
Deficit
accumulated
Additional during
Common Stock paid-in development
Shares Amount capital stage
---------------------------------------------------------------
April 9,1999
<S> <C> <C> <C> <C>
issued for cash 2,100,000 210.00 209,790.00
Net loss
February 19, 1999
(inception) to
April 30, 1999 (21,415.00)
---------------------------------------------------------------
Balance
April 6,1999 2,100,000 $210.00 $209,790.00 ($21,415.00)
===============================================================
</TABLE>
See accompany notes to financial statemehts & audit report
-4-
F-4
<PAGE>
PDTech.com
(A Development Stage Company)
STATEMENT OF CASH FLOWS
FOR PERIOD
February 19, 1999 (Date of Inception), to April 30, 1999
<TABLE>
<CAPTION>
CASH FLOWS FROM OPERATING ACTIVITIES
<S> <C>
Cash received from customers 0.00
Interest Income in the course of business 284.00
----------
Net Cash provided by Operating Activities 284.00
Cash paid to suppliers and employees 19,490.00
----------
Cash disbursed for Operating Activities 19,490.00
----------
Net cash flow provided by operating activities (19,206.00)
CASH FLOWS FROM INVESTING ACTIVITIES
Advance from shareholders 1,000.00
----------
Net cash used by investing activities (1,000.00)
CASH FLOWS FROM FINANCING ACTIVITIES
Issuance of Capital Stock 210,000.00
Cash disbursed for organization costs 195.00
----------
Net cash provided by financing activities 209,805.00
Net increase (decrease) in cash 189,599.00
April 30, 1999 189,599.00
</TABLE>
See accompany notes to financial statements & audit report
-5-
F-5
<PAGE>
PDTech.com
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
April 30, 1999
NOTE 1 - HISTORY AND ORGANIZATION OF THE COMPANY
The Company was organized February 19, 1999 (Date of Inception) under the
laws of the State of Nevada, as PDTech,com (The Company) has no operations and
in accordance with SFAS #7, the Company is considered a development stage
company.
On April 9, 1999, the Company completed a public offering that was exempt
from federal registration pursuant to Regulation D, Rule 504 of the Securities
Act of 1933 as amended The Company sold 2,100,000 shares of Common Stock at a
price of $.10 per share for a total amount raised of $210,000.00. The Company
received cash in the amount of $210,000.
NOTE 2 - ACCOUNTING POLICIES AND PROCEDURES
Accounting polices and procedures have not been determined except as
follows:
1. The Company uses the accrual method of accounting.
2 The cost of organization, $1,590.00, is being amortized over a period of
60 months (February 19, 1999 through February 18, 2003.)
3. Earnings per share is computed using the weighted average number of
shares of common stock outstanding.
4. The Company has not yet adopted any policy regarding payment of
dividends. No dividends have been paid since inception.
5. The cost of equipment is depreciated over the estimated useful life of
the equipment utilizing the straight line method of deprecation.
6. The Company will review its need for a provision for federal income tax
on a quarterly basis and as Statements of Operations are issued.
NOTE 3 - GOING CONCERN
The Company's financial statements are prepared using the generally
accepted accounting principles applicable to a going concern, which contemplates
the realization of assets and liquidation of liabilities in the normal course of
business. However, the Company has no current source of revenue. Without
realization of additional capital, it would be unlikely for the Company to
continue as a going concern. It is management's plan to seek additional capital
through a registered public offering of securities.
-6-
F-6
<PAGE>
PDTech.com
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
April 30, 1999
NOTE 4 - RELATED PARTY TRANSACTION
The Company neither owns or leases any real or personal property. Office
services are provided without charge by a director. Such costs are immaterial to
the financial statements and, accordingly, have not been reflected therein. The
officers and directors of the Company are involved in other business activities
and may, in the future, become involved in other business opportunities. If a
specific business opportunity becomes available, such persons may face a
conflict in selecting between the Company and their other business interests.
The Company has not formulated a policy for the resolution of such conflicts.
NOTE 5 - WARRANTS AND OPTIONS
There are no warrants or options outstanding to acquire any additional
shares of common stock.
F-7
<PAGE>
SECRETARY OF STATE
[SEAL]
STATE OF NEVADA
CORPORATE CHARTER
I, DEAN HELLER, the duly elected and qualified Nevada Secretary of State, do
hereby certify that POWER DIRECT TECH.COM did on February 19, 1999 file in this
office the original Articles of Incorporation; that said Articles are now on
file and of record in the office of the Secretary of State of the State of
Nevada, and further, that said Articles contain all the provisions required by
the law of said State of Nevada.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed
the Great Seal of State, at my office, in Carson City,
Nevada, on February 19, 1999.
[SEAL]
/s/ Dean Heller
-----------------------------
Secretary of State
By /s/ Denise A. Bates
-----------------------------
Certification Clerk
E-1
FILED# C3898-99
FEB 19 1999
IN THE OFFICE OF
/s/ Dean Heller
DEAN HELLER SECRETARY OF STATE
ARTICLES OF INCORPORATION
OF
Power Direct Tech.com
* * * * *
The undersigned, acting as incorporator, pursuant to the provisions of the
laws of the State of Nevada relating to private corporations, hereby adopts the
following Articles of Incorporation:
ARTICLE ONE. (NAME). The name of the corporation is:
Power Direct Tech.com
ARTICLE TWO. [RESIDENT AGENT). The initial agent for service of process is
Nevada Agency and Trust Company, 50 West Liberty Street, Suite 880, City of
Reno, County of Washoe, State of Nevada 89501.
ARTICLE THREE. [PURPOSES). The purposes for which the corporation is
organized are to engage in any activity or business not in conflict with the
laws of the State of Nevada or of the United States of America, and without
limiting the generality of the foregoing, specifically:
I. [OMNIBUS). To have to exercise all the powers now or hereafter
conferred by the laws of the State of Nevada upon corporations organized
pursuant to the laws under which the corporation is organized and any and
all acts amendatory thereof and supplemental thereto.
II. [CARRYING ON BUSINESS OUTSIDE STATE). To conduct and carry on its
business or any branch thereof in any state or territory of the United
States or in any foreign country in conformity with the laws of such state,
territory, or foreign country, and to have and maintain in any state,
territory, or foreign country a business office, plant, store or other
facility.
III. [PURPOSES TO BE CONSTRUED AS POWERS). The purposes specified
herein shall be construed both as purposes and powers and shall be in no
wise limited or restricted by reference to, or inference from, the terms
E-2
<PAGE>
of any other clause in this or any other article, but the purposes and
powers specified in each of the clauses herein shall be regarded as
independent purposes and powers, and the enumeration of specific purposes
and powers shall not be construed to limit or restrict in any manner the
meaning of general terms or of the general powers of the corporation; nor
shall the expression of one thing be deemed to exclude another, although it
be of like nature not expressed.
ARTICLE FOUR. [CAPITAL STOCK). The corporation shall have authority to
issue, an aggregate of ONE HUNDRED MILLION (100,000,000) Common Capital Shares,
PAR VALUE $0.000l per share.
The holders of shares of capital stock of the corporation shall not be
entitled to pre-emptive or preferential rights to subscribe to any unissued
stock or any other securities which the corporation may now or hereafter be
authorized to issue.
The corporation's capital stock may be issued and sold from time to time
for such consideration as may be fixed by the Board of Directors, provided that
the consideration so fixed is not less than par value.
The stockholders shall not possess cumulative voting rights at all
shareholders meetings called for the purpose of electing a Board of Directors.
ARTICLE FIVE. [DIRECTORS). The affairs of the corporation shall be governed
by a Board of Directors of no more than eight (8) nor less than one (1) person.
The name and addresss of the first Board of Director is:
NAME ADDRESS
Jack Sha 1288 Alberni Street, Suite 806
Vancouver, British Columbia
Canada VEE 4N5
ARTICLE SIX. (ASSESSMENT OF STOCK). The capital stock of the corporation,
after the amount of the subscription price or par value has been paid in, shall
not be subject to pay debts of the corporation, and no paid up stock and no
stock issued as fully paid up shall ever be assessable or assessed.
2
E-3
<PAGE>
ARTICLE SEVEN. [INCORPORATOR]. The name and address of the incorporator of
the corporation is as follows:
NAME ADDRESS
Amanda Cardinalli 50 West Liberty Street, Suite 880
Reno, Nevada 89501
ARTICLE EIGHT. [PERIOD OF EXISTENCE]. The period of existence of the
corporation shall be perpetual.
ARTICLE NINE. [BY-LAWS]. The initial By-laws of the corporation shall be
adopted by its Board of Directors. The power to alter, amend, or repeal the
By-laws, or to adopt new By-laws, shall be vested in the Board of Directors,
except as otherwise may be specifically provided in the By-laws.
ARTICLE TEN. [STOCKHOLDERS' MEETINGS]. Meetings of stockholders shall be
held at such place within or without the State of Nevada as may be provided by
the By-laws of the corporation. Special meetings of the stockholders may be
called by the President or any other executive officer of the corporation, the
Board of Directors, or any member thereof, or by the record holder or holders of
at least ten percent (10%) of all shares entitled to vote at the meeting. Any
action otherwise required to be taken at a meeting of the stockholders, except
election of directors, may be taken without a meeting if a consent in writing,
setting forth the action so taken, shall be signed by stockholders having at
least a majority of the voting power.
ARTICLE ELEVEN. [CONTRACTS OF CORPORATION]. No contract or other
transaction between the corporation and any other corporation, whether or not a
majority of the shares of the capital stock of such other corporation is owned
by this corporation, and no act of this corporation shall in any way be affected
or invalidated by the fact that any of the directors of this corporation are
pecuniarily or otherwise interested in, or are directors or officers of such
other corporation. Any director of this corporation, individually, or any firm
of which such director may be a member, may be a party to, or may be pecuniarily
or otherwise interested in any contract or transaction of the corporation;
provided, however, that the fact that he or such firm is so interested shall be
disclosed or shall have been known to the Board of Directors of this
corporation, or a majority thereof; and any director of this corporation who is
also a director or officer of such other corporation, or who is so interested,
may be counted in determining the existence of a quorum at any meeting of the
Board of Directors of this corporation that shall authorize such contract or
transaction, and may vote thereat to authorize such contract or transaction,
with like force and effect as if he were
3
E-4
<PAGE>
not such director or officer of such other corporation or not so interested.
ARTICLE TWELVE. [LIABILITY OF DIRECTORS AND OFFICERS]. No director or
officer shall have any personal liability to the corporation or its stockholders
for damages for breach of fiduciary duty as a director or officer, except that
this Article Twelve shall not eliminate or limit the liability of a director or
officer for (I) acts or omissions which involve intentional misconduct, fraud or
a knowing violation of law, or (ii) the payment of dividends in violation of the
Nevada Revised Statutes.
IN WITNESS WHEREOF, the undersigned incorporator has hereunto affixed her
signature at Reno, Nevada this 18th day of February, 1999.
/s/ Amanda Cardinalli
-------------------------
AMANDA CARDINALLI
STATE OF NEVADA }
: ss.
COUNTY OF WASHOE }
On the 18th day of February, 1999, before me, the undersigned, a Notary
Public in and for the State of Nevada, personally appeared AMANDA CARDINALLI,
known to me to be the person described in and who executed the foregoing
instrument, and who acknowledged to me that she executed the same freely and
voluntarily for the uses and purposes therein mentioned.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year first above written.
/s/ Margaret A. Oliver
------------------------------
NOTARY PUBLIC
Residing in Reno, Nevada
My Commission Expires: MARGARET A. OLIVER
October 10, 2002 [SEAL] Notary Public - State of Nevada
Appointment Recorded in Washoe County
No. 94-5323-2-EXPIRES OCT. 10, 2002
4
E-5
FILED
IN THE OFFICE OF THE
SECRETARY OF THE STATE OF THE
STATE OF NEVADA
FEB 23 1999
No. C3898-99
/s/ Dean Heller
DEAN HELLER SECRETARY OF STATE
CERTIFICATE OF AMENDMENT
TO THE ARTICLES OF INCORPORATION
POWER DIRECT TECH.COM
* * * * * *
The undersigned, being the original incorporator and constituting at least
two-thirds of the original incorporators of POWER DIRECT TECH.COM, a Nevada
corporation, hereby amends Article One of the Articles of Incorporation of this
corporation to read as follows:
ARTICLE ONE. [NAME] the name of the corporation is
PDTech.com
In accordance with the provisions of Section 78.380 of the Nevada Revised
Statutes, the original incorporator of the corporation states the following:
1. The date on which the original Articles of Incorporation were filed with
the Secretary of State of Nevada was February 19, 1999.
2. To the date of this Amendment, no part of the capital of the corporation
has been paid and no stock has been issued.
IN WITNESS WHEREOF, the undersigned, being the original incorporator of
POWER DIRECT TECH.COM, hereunto affixes her signature this 22nd day of February,
1999.
/s/ Amanda W. Cardinalli
---------------------------
Amanda W. Cardinalli
Incorporator
1
E-6
<PAGE>
STATE OF NEVADA )
:
COUNTY OF WASHOE )
On the 22nd day of February, 1999 before me, the undersigned, a Notary
Public, personally appeared Amanda W. Cardinalli, known to be the person
described in and who executed the foregoing instrument, and who acknowledged to
me that she executed the same freely and voluntarily and for the uses and
purposes therein mentioned.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.
/s/ Margaret A. Oliver
----------------------------
NOTARY PUBLIC
Residing in Reno, Nevada
My Commission Expires: [SEAL] MARGARET A. OLIVER
Notary Public - State of Nevada
October 10, 2002 Appointment Recorded in Washoe County
No. 94-5323-2-EXPIRES OCT. 10, 2002
2
E-7
FILED
IN THE OFFICE OF THE
SECRETARY OF THE STATE OF THE
STATE IF NEVADA
JUN 08 1998
No. C3898-99
/s/ Dean Heller
DEAN HELLER SECRETARY OF STATE
CERTIFICATE OF AMENDMENT
TO THE ARTICLES OF INCORPORATION
PDTech.com
* * * * * *
The undersigned, being the original incorporator and constituting at least
two-thirds of the original incorporators of PDTech.com, a Nevada corporation,
hereby amends Article One of the Articles of Incorporation of this corporation
to read as follows:
ARTICLE ONE. [NAME] the name of the corporation is
CardStakes.com
In accordance with the provisions of Section 78.3 80 of the Nevada Revised
Statutes, the original incorporator of the corporation states the following:
1. The date on which the original Articles of Incorporation were filed with
the Secretary of State of Nevada was February 19, 1999.
2. To the date of this Amendment, no part of the capitai of the corporation
has been paid and no stock has been issued.
IN WITNESS WHEREOF, the undersigned, being the original incorporator of
PDTech.com, hereunto affixes her signature this 7th day of June, 1999.
/s/ Amanda W. Cardinalli
----------------------------
Amanda W. Cardinalli
Incorporator
1
E-8
<PAGE>
STATE OF NEVADA )
:
COUNTY OF WASHOE )
On the 7th day of June, 1999 before me, the undersigned, a Notary Public,
personally appeared Amanda W. Cardinaili, known to be the person described in
and who executed the foregoing instrument, and who acknowledged to me that she
executed the same freely and voluntarily and for the uses and purposes therein
mentioned.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.
/s/ Margaret A. Oliver
--------------------------------
NOTARY PUBLIC
Residing in Reno, Nevada
My Commission Expires: [SEAL] MARGARET A. OLIVER
Notary Public-State of Nevada
October 10, 2002 Appointment Recorded in Washoe County
No.94-5323-2-EXPIRES OCT. 10, 2002
2
E-9
FILED
IN THE OFFICE OF THE
SECRETARY OF THE STATE OF THE
STATE OF NEVADA
MAR 09 1999
No C3898-99
/s/ Dean Heller
DEAN HELLER SECRETARY OF STATE
CERTIFICATE OF AMENDMENT
TO THE ARTICLES OF INCORPORATION
PDTech.com
* * * * *
The undersigned, being the original incorporator and constituting at least
two-thirds of the original incorporators of PDTech.com, a Nevada corporation,
hereby amends the Articles of Incorporation of this corporation to include
Article Thirteen as follows:
ARTICLE THIRTEEN. [ANTI-DILUTION]. At all times during The existence of
this corporation Power Direct, Inc., a Delaware corporation, shall not own less
than that number of shares of this corporation's common stock equal to fifty-one
percent (51%) of this corporation's total issued and outstanding common stock.
In the event of any share issuance, merger, consolidation, reorganization,
recapitalization, reclassification of the capital stock of this corporation,
stock split, reverse stock split, share dividend, or other change affecting the
number of issued and outstanding shares of common stock of this corporation in
any manner whatsoever and which would result in Power Direct, Inc. owning less
than fifty-one percent (51%) of the issued and outstanding shares of common
stock of this corporation, the number of shares of this corporation's common
stock held by Power Direct, Inc. shall be adjusted on the consummation of any
such change so as to preserve the ownership by Power Direct, Inc. of that number
of shares of this corporation's common stock equal to fifty-one percent (51%) of
the then issued and outstanding common stock of this corporation.
In accordance with the provisions of Section 78.3 80 of the Nevada Revised
Statutes, the original incorporator of the corporation states the following:
1. The date on which the original Articles of Incorporation were filed with
the Secretary of State of Nevada was February 19, 1999.
2. To the date of this Amendment, no part of the capital of the corporation
has been paid and no stock has been issued.
1
E-10
<PAGE>
IN WITNESS WHEREOF, the undersigned, being the original incorporator of
PDTech.com, hereunto affixes her signature this 3rd day of March, 1999.
/s/ Amanda W. Cardinalli
----------------------------
Amanda W. Cardinalli
Incorporator
STATE OF NEVADA )
:
COUNTY OF WASHOE )
On the 3rd day of March, 1999 before me, the undersigned, a Notary Public,
personally appeared Amanda W. Cardinalli, known to be the person described in
and who executed the foregoing instrument, and who acknowledged to me that she
executed the same freely and voluntarily and for the uses and purposes therein
mentioned.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.
/s/ Margaret A. Oliver
----------------------------
NOTARY PUBLIC
My Commission Expires: [SEAL] MARGARET A. OLIVER
Notary Public-State of Nevada
October 10, 2002 Appointment Recorded in Washoe County
No. 94-5323-2-EXPIRES OCT. 10, 2002
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BYLAWS FOR THE REGULATION
EXCEPT AS OTHERWISE PROVIDED BY STATUTE
OR ITS ARTICLES OF INCORPORATION OF
PDTECH.COM
ARTICLE I.
Offices
Section 1. PRINCIPAL OFFICE. The principal office for the transaction of
the business of the corporation is hereby fixed and located at Suite 880, Bank
of America Plaza, 50 West Liberty Street, Reno, Nevada 89501, being the offices
of THE NEVADA AGENCY AND TRUST COMPANY. The board of directors is hereby granted
full power and authority to change said principal office from one location to
another in the State of Nevada.
Section 2. OTHER OFFICES. Branch or subordinate offices may at any time be
established by the board of directors at any place or places where the
corporation is qualified to do business.
ARTICLE II.
Meetings of Shareholders
Section 1. MEETING PLACE. All annual meetings of shareholders and all other
meetings of shareholders shall be held either at the principal office or at any
other place within or without the State of Nevada which may be designated either
by the board of directors, pursuant to authority hereinafter granted to said
board, or by the written consent of all shareholders entitled to vote thereat,
given either before or shareholders entitled to
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vote thereat, given either before or after the meeting and filed with the
Secretary of the corporation.
Section 2. ANNUAL MEETINGS. The annual meetings of shareholders shall be
held on the second Thursday of September of each year, at the hour of 10:00
o'clock A.M. of said day commencing with the year 1999; provided, however, that
should said day fall upon a legal holiday then any such annual meeting of
shareholders shall be held at the same time and place on the next day thereafter
ensuing which is not a legal holiday.
Written notice of each annual meeting signed by the president or a vice
president, or the secretary, or an assistant secretary, or by such other person
or persons as the directors shall designate, shall be given to each shareholder
entitled to vote thereat, either personally or by mail or other means of written
communication, charges prepaid, addressed to such shareholder at his address
appearing on the books of the corporation or given by him to the corporation for
the purpose of notice. If a shareholder gives no address, notice shall be deemed
to have been given to him, if sent by mail or other means of written
communication addressed to the place where the principal office of the
corporation is situated, or if published at least once in some newspaper of
general circulation in the county in which said office is located. All such
notices shall be sent to each shareholder entitled thereto not less than ten
(10) nor more than sixty (60) days before each annual meeting, and shall specify
the place, the day and the hour of such meeting, and shall also state the
purpose or purposes for which the meeting is called.
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Section 3. SPECIAL MEETINGS. Special meetings of the shareholders, for any
purpose or purposes whatsoever, may be called at any time by the president or by
the board of directors, or by one or more shareholders holding not less than 10%
of the voting power of the corporation. Except in special cases where other
express provision is made by statute, notice of such special meetings shall be
given in the same manner as for annual meetings of shareholders. Notices of any
special meeting shall specify in addition to the place, day and hour of such
meeting, the purpose or purposes for which the meeting is called.
Section 4. ADJOURNED MEETINGS AND NOTICE THEREOF. Any shareholders'
meeting, annual or special, whether or not a quorum is present, may be adjourned
from time to time by the vote of a majority of the shares, the holders of which
are either present in person or represented by proxy thereat, but in the absence
of a quorum, no other business may be transacted at any such meeting.
When any shareholders' meeting, either annual or special, is adjourned for
thirty (30) days or more, notice of the adjourned meeting shall be given as in
the case of an original meeting. Save as aforesaid, it shall not be necessary to
give any notice of an adjournment or of the business to be transacted at an
adjourned meeting, other than by announcement at the meeting at which such
adjournment is taken.
Section 5. ENTRY OF NOTICE. Whenever any shareholder entitled to vote has
been absent from any meeting of shareholders, whether annual or special, an
entry in the
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minutes to the effect that notice has been duly given shall be conclusive and
incontrovertible evidence that due notice of such meeting was given to such
shareholders, as required by law and the Bylaws of the corporation.
Section 6. VOTING. At all annual and special meetings of stockholders
entitled to vote thereat, every holder of stock issued to a bona fide purchaser
of the same, represented by the holders thereof, either in person or by proxy in
writing, shall have one vote for each share of stock so held and represented at
such meetings, unless the Articles of Incorporation of the company shall
otherwise provide, in which event the voting rights, powers and privileges
prescribed in the said Articles of Incorporation shall prevail. Voting for
directors and, upon demand of any stockholder, upon any question at any meeting
shall be by ballot. Any director may be removed from office by the vote of
stockholders representing not less than two-thirds of the voting power of the
issued and outstanding stock entitled to voting power.
Section 7. QUORUM. The presence in person or by proxy of the holders of a
majority of the shares entitled to vote at any meeting shall constitute a quorum
for the transaction of business. The shareholders present at a duly called or
held meeting at which a quorum is present may continue to do business until
adjournment, notwithstanding the withdrawal of enough shareholders to leave less
than a quorum.
Section 8. CONSENT OF ABSENTEES. The transactions of any meeting of
shareholders, either annual or special, however called and noticed, shall be as
valid as
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though at a meeting duly held after regular call and notice, if a quorum be
present either in person or by proxy, and if either before or after the meeting,
each of the shareholders entitled to vote, not present in person or by proxy,
sign a written waiver of Notice, or a consent to the holding of such meeting, or
an approval of the minutes thereof. All such waivers, consents or approvals
shall be filed with the corporate records or made a part of the minutes of this
meeting.
Section 9. PROXIES. Every person entitled to vote or execute consents shall
have the right to do so either in person or by an agent or agents authorized by
a written proxy executed by such person or his duly authorized agent and filed
with the secretary of the corporation; provided that no such proxy shall be
valid after the expiration of eleven (11) months from the date of its execution,
unless the shareholder executing it specifies therein the length of time for
which such proxy is to continue in force, which in no case shall exceed seven
(7) years from the date of its execution.
ARTICLE III
Section 1. POWERS. Subject to the limitations of the Articles of
Incorporation or the Bylaws, and the provisions of the Nevada Revised Statutes
as to action to be authorized or approved by the shareholders, and subject to
the duties of directors as prescribed by the Bylaws, all corporate powers shall
be exercised by or under the authority of, and the business and affairs of the
corporation shall be controlled by the board of directors. Without prejudice to
such general powers, but subject to the same limitations,
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it is hereby expressly declared that the directors shall have the following
powers, to wit:
First - To select and remove all the other officers, agents and employees
of the corporation, prescribe such powers and duties for them as may not be
inconsistent with law, with the Articles of Incorporation or the Bylaws, fix
their compensation, and require from them security for faithful service.
Second - To conduct, manage and control the affairs and business of the
corporation, and to make such rules and regulations therefor not inconsistent
with law, with the Articles of incorporation or the Bylaws, as they may deem
best.
Third - To change the principal office for the transaction of the business
of the corporation from one location to another within the same county as
provided in Article I, Section 1, hereof; to fix and locate from time to time
one or more subsidiary offices of the corporation within or without the State of
Nevada, as provided in Article I, Section 2, hereof; to designate any place
within or- without the State of Nevada for the holding of any shareholders I
meeting or meetings; and to adopt, make and use a corporate seal, and to
prescribe the forms of certificates of stock, and to alter the form of such seal
and of such certificates from time to time, as in their judgment they may deem
best, provided such seal and such certificates shall at all times comply with
the provisions of law.
Fourth - To authorize the issue of shares of stock of the corporation from
time to time, upon such terms as may be lawful, in consideration of money paid,
labor done or services actually rendered, debts or securities canceled, or
tangible or intangible property
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actually received, or in the case of shares issued as a dividend, against
amounts transferred from surplus to stated capital.
Fifth - To borrow money and incur indebtedness for the purposes of the
corporation, and to cause to be executed and delivered therefor, in the
corporate name, promissory notes, bonds, debentures, deeds of trust, mortgages,
pledges, hypothecations or other evidences of debt and securities therefore.
Sixth - To appoint an executive committee and other committees and to
delegate to the executive committee any of the powers and authority of the board
in management of the business and affairs of the corporation, except the power
to declare dividends and to adopt, amend or repeal Bylaws. The executive
committee shall be composed of one or more directors.
Section 2. NUMBER AND QUALIFICATION OF DIRECTORS. The authorized number of
directors of the corporation shall be not less than one (1) and no more than
fifteen (15).
Section 3. ELECTION AND TERM OF OFFICE. The directors shall be elected at
each annual meeting of shareholders, but if any such annual meeting is not held,
or the directors are not elected thereat, the directors may be elected at any
special meeting of shareholders. All directors shall hold office until their
respective successors are elected.
Section 4. VACANCIES. Vacancies in the board of directors may be filled by
a majority of the remaining directors, though less than a quorum, or by a sole
remaining
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director, and each director so elected shall hold office until his successor is
elected at an annual or a special meeting of the shareholders.
A vacancy or vacancies in the board of directors shall be deemed to exist
in case of the death, resignation or removal of any director, or if the
authorized number of directors be increased, or if the shareholders fail at any
annual or special meeting of shareholders at which any director or directors are
elected to elect the full authorized number of directors to be voted for at that
meeting.
The shareholders may elect a director or directors at any time to fill any
vacancy or vacancies not filled by the directors. If the board of directors
accept the resignation of a director tendered to take effect at a future time,
the board or the shareholders shall have the power to elect a successor to take
office when the resignation is to become effective.
No reduction of the authorized number of directors shall have the effect of
removing any director prior to the expiration of his term of office.
Section 5. PLACE OF MEETING. Regular meetings of the board of directors
shall be held at any place within or without the State which has been designated
from time to time by resolution of the board or by written consent of all
members of the board. In the absence of such designation, a regular meeting
shall be held at the principal office of the corporation. Special meetings of
the board may be held either at a place so designated, or at the principal
office.
Section 6. ORGANIZATION MEETING. Immediately following each annual
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meeting of shareholders, the board of directors shall hold a regular meeting for
the purpose of organization, election of officers, and the transaction of other
business. Notice of such meeting is hereby dispensed with.
Section 7. OTHER REGULAR MEETINGS. Other regular meetings of the board of
directors shall be held without call on the eighth (8th) day of each month at
the hour of 10:00 clock A.M. of said day; provided, however, should said day
fall upon a legal holiday, then said meeting shall be held at the same time on
the next day thereafter ensuing which is not a legal holiday. Notice of all such
regular meetings of the board of directors is hereby dispensed with.
Section 8. SPECIAL MEETINGS. special meetings of the board of directors for
any purpose or purposes shall be called at any time by the president, or, if he
is absent or unable or refuses to act, by any vice president or by any two (2)
directors.
Written notice of the time and place of special meetings shall be delivered
personally to the directors or sent to each director by mail or other form of
written communication, charges prepaid, addressed to him at his address as it is
shown upon the records of the corporation, or if it is not shown on such records
or is not readily ascertainable, at the place in which the meetings of the
directors are regularly held. In case such notice is mailed or telegraphed, it
shall be deposited in the United States mail or delivered to the telegraph
company in the place in which the principal office of the corporation is located
at least forty-eight (48) hours prior to the time of the holding of the
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meeting. In case such notice is delivered as above provided, it shall be so
delivered at least twenty-four (24) hours prior to the time of the holding of
the meeting. Such mailing, telegraphing or delivery as above provided shall be
due, legal and personal notice to such director.
Section 9. NOTICE OF ADJOURNMENT. Notice of the time and place of holding
an adjourned meeting need not be given to absent directors, if the time and
place be fixed at the meeting adjourned.
Section 10. ENTRY OF NOTICE. Whenever any director has been absent from any
special meeting of the board of directors, an entry in the minutes to the effect
that notice has been duly given shall be conclusive and incontrovertible
evidence that due notice of such special meeting was give to such director, as
required by law and the Bylaws of the corporation.
Section 11. WAIVER OF NOTICE. The transactions of any meeting of the board
of directors, however called and noticed or wherever held, shall be as valid as
though had a meeting duly held after regular call and notice, if a quorum be
present, and if, either before or after the meeting, each of the directors not
present sign a written waiver of notice or a consent to the holding of such
meeting or an approval of the minutes thereof. All such waivers, consents or
approvals shall be filed with the corporate records or made a part of the
minutes of the meeting.
Section 12. QUORUM. A majority of the authorized number of directors shall
be
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necessary to constitute a quorum for the transaction of business, except to
adjourn as hereinafter provided. Every act or decision done or made by a
majority of the directors present at a meeting duly held at which a quorum is
present, shall be regarded as the act of the board of directors, unless a
greater number be required by law or by the Articles of Incorporation.
Section 13. ADJOURNMENT. A quorum of the directors may adjourn any
directors' meeting to meet again at a stated day and hour; provided, however,
that in the absence of a quorum, a majority of the directors present at any
directors' meeting, either regular or special, may adjourn from time to time
until the time fixed for the next regular meeting of the board.
Section 14. FEES AND COMPENSATION. Directors shall not receive any stated
salary for their services as directors, but by resolution of the board, a fixed
fee, with or without expenses of attendance may be allowed for attendance at
each meeting. Nothing herein contained shall be construed to preclude any
director from serving the corporation in any other capacity as an officer,
agent, employee, or otherwise, and receiving compensation therefor.
ARTICLE IV.
Officers
Section 1. OFFICERS. The officers of the corporation shall be a president,
a vice president and a secretary/treasurer. The corporation may also have, at
the discretion of
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the board of directors, a chairman of the board, one or more vice presidents,
one or more assistant secretaries, one or more assistant treasurers, and such
other officers as may be appointed in accordance with the provisions of Section
3 of this Article. Officers other than president and chairman of the board need
not be directors. Any person may hold two or more offices.
Section 2. ELECTION. The officers of the corporation, except such officers
as may be appointed in accordance with the provisions of Section 3 or Section 5
of this Article, shall be chosen annually by the board of directors, and each
shall hold his office until he shall resign or shall be removed or otherwise
disqualified to serve, or his successor shall be elected and qualified.
Section 3. SUBORDINATE OFFICERS, ETC. The board of directors may appoint
such other officers as the business of the corporation may require, each of whom
shall hold office for such period, have such authority and perform such duties
as are provided in the Bylaws or as the board of directors may from time to time
determine.
Section 4. REMOVAL AND RESIGNATION. Any officer may be removed, either with
or without cause, by a majority of the directors at the time in office, at any
regular or special meeting of the board.
Any officer may resign at any time by giving written notice to the board of
directors or to the president, or to the secretary of the corporation. Any such
resignation shall take effect at the date of the receipt of such notice or at
any later time specified therein; and,
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unless otherwise specified therein, the acceptance of such resignation shall not
be necessary to make it effective.
Section 5. VACANCIES. A vacancy in any office because of death,
resignation, removal, disqualification or any other cause shall be filled in the
manner prescribed in the Bylaws for regular appointments to such office.
Section 6. CHAIRMAN OF THE BOARD. The chairman of the board, if there shall
be such an officer, shall, if present, preside at all meetings of the board of
directors, and exercise and perform such other powers and duties as may be from
time to time assigned to him by the board of directors or prescribed by the
Bylaws.
Section 7. PRESIDENT. Subject to such supervisory powers, if any, as may be
given by the board of directors to the chairman of the board, if there be such
an officer, the president shall be the chief executive officer of the
corporation and shall, subject to the control of the board of directors, have
general supervision, direction and control of the business and officers of the
corporation. He shall preside at all meetings of the shareholders and in the
absence of the chairman of the board, or if there be none, at all meetings of
the board of directors. He shall be ex-officio a member of all the standing
committees, including the executive committee, if any, and shall have the
general powers and duties of management usually vested in the office of
president of a corporation, and shall have such other powers and duties as may
be prescribed by the board of directors or the Bylaws.
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Section 8. VICE PRESIDENT. In the absence or disability of the president,
the vice presidents in order of their rank as fixed by the board of directors,
or if not ranked, the vice president designated by the board of directors, shall
perform all 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. The vice
presidents shall have such other powers and perform such other duties as from
time to time may be prescribed for them respectively by the board of directors
or the Bylaws.
Section 9. SECRETARY. The secretary shall keep, or cause to be kept, a book
of minutes at the principal office or such other place as the board of directors
may order, of all meetings of directors and shareholders, with the time and
place of holding, whether regular or special, and if special, how authorized,
the notice thereof given, the names of those present at directors' meetings, the
number of shares present or represented at shareholders' meetings and the
proceedings thereof.
The secretary shall keep, or cause to be kept, at the principal office, a
share register, or a duplicate share register, showing the names of the
shareholders and their addresses; the number and classes of shares held by each;
the number and date of certificates issued for the same, and the number and date
of cancellation of every certificate surrendered for cancellation.
The secretary shall give, or cause to be given, notice of all the meetings
of the shareholders and of the board of directors required by the Bylaws or by
law to be given,
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and he shall keep the seal of the corporation in safe custody, and shall have
such other powers and perform such other duties as may be prescribed by the
board of directors or the Bylaws.
Section 10. TREASURER. The treasurer shall keep and maintain, or cause to
be kept and maintained, adequate and correct accounts of the properties and
business transactions of the corporation, including accounts of its assets,
liabilities, receipts, disbursement, gains, losses, capital, surplus and shares.
Any surplus, including earned surplus, paid-in surplus and surplus arising from
a reduction of stated capital, shall be classified according to source and shown
in a separate account. The books of account shall at all times be open to
inspection by any director.
The treasurer shall deposit all moneys and other valuables in the name and
to the credit of the corporation with such depositories as may be designated by
the board of directors. He shall disburse the funds of the corporation as may be
ordered by the board of directors, shall render to the president and directors,
whenever they request it, an account of all of his transactions as treasurer and
of the financial condition of the corporation, and shall have such other powers
and perform such other duties as may be prescribed by the board of directors or
the Bylaws.
ARTICLE V.
Miscellaneous
Section 1. RECORD DATE AND CLOSING STOCK BOOKS. The board of
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directors may fix a time, in the future, not exceeding fifteen (15) days
preceding the date of any meeting of shareholders, and not exceeding thirty (30)
days preceding the date fixed for the payment of any dividend or distribution,
or for the allotment of rights, or when any change or conversion or exchange of
shares shall go into effect, as a record date for the determination of the
shareholders entitled to notice of and to vote at any such meeting, or entitled
to receive any such dividend or distribution, or any such allotment of rights,
or to exercise the rights in respect to any such change, conversion or exchange
of shares, and in such case only shareholders of record on the date so fixed
shall be entitled to notice of and to vote at such meetings, or to receive such
dividend, distribution or allotment of rights, or to exercise such rights, as
the case may be, notwithstanding any transfer of any shares on the books of the
corporation after any record date fixed as aforesaid. The board of directors may
close the books of the corporation against transfers of shares during the whole,
or any part of any such period.
Section 2. INSPECTION OF CORPORATE RECORDS. The share register or duplicate
share register, the books of account, and minutes of proceedings of the
shareholders and directors shall be open to inspection upon the written demand
of any shareholder or the holder of a voting trust certificate, at any
reasonable time, and for a purpose reasonably related to his interests as a
shareholder, or as the holder of a voting trust certificate, and shall be
exhibited at any time when required by the demand of ten percent (10%) of the
shares represented at any shareholders' meeting. Such inspection
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may be made in person or by an agent or attorney, and shall include the right to
make extracts. Demand of inspection other than at a shareholders' meeting shall
be made in writing upon the president, secretary or assistant secretary of the
corporation.
Section 3. CHECKS, DRAFTS, ETC. All checks, drafts or other orders for
payment of money, notes or other evidences of indebtedness, issued in the name
of or payable to the corporation, shall be signed or endorsed by such person or
persons and in such manner as, from time to time, shall be determined by
resolution of the board of directors.
Section 4. ANNUAL REPORT. The board of directors of the corporation shall
cause to be sent to the shareholders not later than one hundred twenty (120)
days after the close of the fiscal or calendar year an annual report.
Section 5. CONTRACT, ETC., HOW EXECUTED. The board of directors, except as
in the Bylaws otherwise provided, may authorize any officer or officers, agent
or agents, to enter into any contract, deed or lease or execute any instrument
in the name of and on behalf of the corporation, and such authority may be
general or confined to specific instances; and unless so authorized by the board
of directors, no officer, agent or employee shall have any power or authority to
bind the corporation by any contract or engagement or to pledge its credit to
render it liable for any purpose or to any amount.
Section 6. CERTIFICATES OF STOCK. A certificate or certificates for shares
of the capital stock of the corporation shall be issued to each shareholder when
any such
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shares are fully paid up. All such certificates shall be signed by the president
or a vice president and the secretary or an assistant secretary, or be
authenticated by facsimiles of the signature of the president and secretary or
by a facsimile of the signature of the president and the written signature of
the secretary or an assistant secretary. Every certificate authenticated by a
facsimile of a signature must be countersigned by a transfer agent or transfer
clerk.
Certificates for shares may be issued prior to full payment under such
restrictions and for such purposes as the board of directors or the Bylaws may
provide; provided, however, that any such certificate so issued prior to full
payment shall state the amount remaining unpaid and the terms of payment
thereof.
Section 7. REPRESENTATIONS OF SHARES OF OTHER CORPORATIONS. The president
or any vice president and the secretary or assistant secretary of this
corporation are authorized to vote, represent and exercise on behalf of this
corporation all rights incident to any and all shares of any other corporation
or corporations standing in the name of this corporation. The authority herein
granted to said officers to vote or represent on behalf of this corporation or
corporations may be exercised either by such officers in person or by any person
authorized so to do by proxy or power of attorney duly executed by said
officers.
Section 8. INSPECTION OF BYLAWS. The corporation shall keep in its
principal office for the transaction of business the original or a copy of the
Bylaws as
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amended, or otherwise altered to date, certified by the secretary, which shall
be open to inspection by the shareholders at all reasonable times during office
hours.
Section 9. REFUSAL TO REGISTER TRANSFER. The Corporation shall not register
any transfer of securities issued by the Corporation in any transaction that
qualifies for the exemption from registration requirements specified by the
provisions of Regulation S, unless such transfer is made in accordance with the
provisions of Regulation S.
ARTICLE VI.
Amendments
Section 1. POWER OF SHAREHOLDERS. New Bylaws may be adopted or these Bylaws
may be amended or repealed by the vote of shareholders entitled to exercise a
majority of the voting power of the corporation or by the written assent of such
shareholders.
Section 2. POWER OF DIRECTORS. Subject to the right of shareholders as
provided in Section 1 of this Article VI to adopt, amend or repeal Bylaws,
Bylaws other than a Bylaw or amendment thereof changing the authorized number of
directors may be adopted, amended or repealed by the board of directors.
Section 3. ACTION BY DIRECTORS THROUGH CONSENT IN LIEU OF MEETING. Any
action required or permitted to be taken at any meeting of the board of
directors or of any committee thereof, may be taken without a meeting, if a
written consent
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thereto is signed by all the members of the board or of such committee. Such
written consent shall be filed with the minutes of proceedings of the board or
committee.
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