U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-SB
GENERAL FORM FOR REGISTRATION OF SECURITIES OF
SMALL BUSINESS ISSUERS
UNDER SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934
BAXTER CAPITAL COMPANY, INC.
(Name of Small Business Issuer in its Charter)
Florida 65-0956104
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
2 South Biscayne Boulevard, Suite 2470
Miami, FL 33131
(Address of Principal Executive Offices) (Zip Code)
(305) 374-0022
Issuer'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 Not Applicable
Securities to be registered pursuant to Section 12(g) of the Act:
Common Stock, $.001 par value
(Title of Class)
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PART I
ITEM 1. DESCRIPTION OF BUSINESS
The name of our company is Baxter Capital Company. Our company was
incorporated in Florida on June 10, 1998. We are a development stage company and
have had no revenues to date. Since incorporation, our activities have been
limited to actions related to our organization and the preparation of this
Registration Statement. Our business plan is to acquire a controlling equity
interest in or assets of an operating company. Our administrative offices are
located at 2 South Biscayne Boulevard, Suite 2470, Miami, FL, 33131 and our
telephone number is (305) 374-0022.
General
Elsie Sanchez was the incorporator of our company and served as Black
Diamond' sole director and officer until August 13, 1999. In August, 1999 an
investor group led by Peter Goldstein and Kenneth Greenberg (collectively, the
"GreenGold Group") acquired control of Baxter Capital Company. The GreenGold
Group acquired control of Baxter Capital for the purpose of listing Black
Diamond's common stock on the OTC electronic bulletin board of the Nasdaq Stock
Market, Inc. to facilitate a public market for the company's common stock. We
intend to use our common stock to acquire a controlling equity interest in or
the assets of a suitable operating company. The registration of our common stock
under the Securities Exchange Act of 1934 is one step that we are taking to
implement our business plan. We are only nominally capitalized and have no other
assets, and no revenues or operations. Since our incorporation, we have not
conducted any business other than in connection with our organization and the
implementation of our business plan.
Baxter Capital and companies of its type are commonly referred to as
"public shell corporations" and the transactions through which public shell
corporations acquire an interest in a suitable operating business are commonly
referred to as "shell reorganizations." Our management believes that certain
privately-held companies are interested in "going public" through a shell
reorganization for a variety of reasons. In the opinion of management, the most
common motivation is the belief that the private company's reconstitution as a
publicly-traded corporation will aid the operating company in obtaining equity
capital and in making acquisitions of other privately-held companies using stock
on the theory that investors are more interested in purchasing equity securities
where a public market for such securities exists.
In selecting a suitable operating company, although we have established
no specific criteria, our management intends to focus on companies with
* a history of profitability
* the potential for future profits, and
* strength of management
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Our management believes that companies operating in technology and
goods or products-related industries have the greatest potential. However, if
other factors exist which commend an operating company as a candidate, such as
recent profitability or a recent improvement in operations or perceived
potential or if the operating company is engaged in a line of business
considered by our management to be strategic in relation to other businesses
acquired or contemplated to be acquired by us, we will consider such other
opportunities as they may arise. In general, we intend to be flexible about the
criteria we will use to evaluate possible acquisition candidates.
We will undertake an examination and review of privately-held operating
companies to identify a suitable candidate for a business to acquire. Once we
identify a suitable candidate our management will, where necessary and
appropriate, prepare a business plan for the operating company using their
general experience and business acumen, or hire consultants to prepare analyses
of the operating company's capital, production, marketing, labor and other
related requirements.
Although we have conducted some preliminary investigations of operating
companies that may be appropriate as acquisition candidates and, in some cases,
have had preliminary discussions with representatives of such operating
companies, we have not yet reached an agreement in principal with any company.
We cannot assure you that we will ever be able to locate an operating company
that we consider a suitable business opportunity and reach an acceptable
agreement with its management, or that our management has the requisite
experience to recognize and understand a business opportunity that would benefit
us.
Our ability to complete any transaction may also be dependent on the
availability of adequate financing, competition from other potential bidders and
general market conditions. In the event that we are able to locate and conclude
a shell reorganization with what we consider to be a suitable operating company,
we cannot assure you that such company will be successful.
We believe that the most likely structure for a transaction with an
operating company is a stock-for-stock exchange having the following features:
* qualification as a tax free reorganization
* issuance of shares of common stock by Baxter Capital to the shareholders
of the operating company equal to approximately 90% to 95% of our issued
and outstanding shares in exchange for the shares of the operating
company, diluting existing shareholders to ownership equal to
approximately 10% to 5%
* appointment of a new slate of officers and directors of Baxter Capital
who are appointees of the operating company
We intend if possible to structure any shell reorganization transaction so
that the transaction may be approved by our board of directors without the need
to obtain the consent of any shareholders. In the event that shareholder
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approval is required, the GreenGold Group acting alone without any other
shareholders have sufficient votes to approve any transaction without the need
to obtain the approval of any other shareholders.
After giving effect to the expected terms of a shell reorganization
with a suitable operating company, we expect that our company will operate as a
holding corporation for the operating company.
If we enter into any agreements, understandings or arrangements prior
to the effectiveness of this Registration Statement, we will file an appropriate
amendment to this Registration Statement for purposes of disclosing terms of the
transaction. Upon the effectiveness of this Registration Statement, we will
become subject to the periodic reporting requirements of Section 12(g) of the
Exchange Act. These requirements will oblige us to file with the Securities and
Exchange Commission specified financial and other information regarding any
company that is a party to a shell reorganization with us, including audited
financial statements for any acquired companies. The financial statement
requirements imposed by the Exchange Act will necessarily limit our pool of
candidates with which we may engage in a shell reorganization to those entities
with audited financial statements meeting the Commission's requirements.
We cannot assure you that we will find a suitable operating company
willing to enter into a shell reorganization with us, or that we have the
requisite experience to recognize and understand the business operations of an
operating company suitable to enter into a shell reorganization with us.
Competition
Numerous large, well-financed firms with large cash reserves are
engaged in the acquisition of companies and businesses. We expect competition to
be intense for available operating companies.
Employees
We have no employees at the present time and does not contemplate
hiring any employees until an operating company is acquired.
RISK FACTORS
An investment in our securities presents certain material risks to
investors. Before you purchase our common stock you are encouraged to carefully
consider the following risks.
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Shell Corporation.
Our company, and other companies with a business plan similar to ours,
are commonly called "shell corporations." A shell corporation does not have any
significant assets or operations and often has been formed solely for the
purpose of acquiring all or substantially all of an existing operating company,
a transaction sometimes called a "shell reorganization". The shell
reorganization generally will be consummated by issuing or transferring large
blocks of the shell corporation's common stock to the shareholders of the
operating company in a share exchange transaction. Any such issuance will
involve significant dilution of the equity interest of our pre-reorganization
shareholders. See "Description of Business."
In the event that Baxter Capital merges with a privately-held company,
most of our shareholders will not have had the benefit of receiving disclosure
of such company's operations and financial condition prior to the consummation
of the shell reorganization. See "Description of Business."
We intend to structure any reorganization with an operating business in
a manner that will allow our board of directors to approve the selection of the
operating business and all of the terms of the reorganization, including the
appointment of the successor officers and directors, without the need or request
for shareholder approval. Even if a shareholder vote is necessary, the GreenGold
Group, voting alone, have sufficient voting power to approve a transaction
without seeking the approval of any other shareholders. See "Description of
Business."
Lack of Assets, Revenues or Operations.
Other than the $1,000 paid for shares of our common stock, and $1,667
loaned to us by a company controlled by Peter Goldstein and Kenneth Greenberg,
we have no assets and have no revenues or operations. We expect that our working
capital requirements will be nominal and will be satisfied, to the extent
required to implement our business plan, through additional capital
contributions or loans by the GreenGold Group, though they are under no
obligation to provide us with any additional funding. However, we cannot assure
you that we will be able to obtain sufficient funds to implement our business
plan.
Reliance on Management; Lack of Experience.
We are dependent on our officers and directors' personal abilities to
evaluate business opportunities and to negotiate an agreement providing for a
shell reorganization that is beneficial to us and our shareholders. No member of
our management has previously acquired or operated a shell corporation, although
our management does have experience in the analysis and acquisition of
businesses. Given the broad range of industries in which the companies that we
are considering for possible acquisitions, there is a high likelihood that our
management will not have had any prior experience in the technical aspects of
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the industry or the business within that industry which may be acquired. See
"Description of Business" and "Management."
Minimal Time Commitment of Management.
Our current officers and directors are engaged in other activities
besides managing our company and will devote less than 10% of their time to
managing the company. See "Management."
Control by Management.
Our management presently owns approximately 95% of our outstanding
common stock. Therefore, until such time as we acquire an operating business,
our management will have the power to elect all of the members of our board of
directors, amend our articles of incorporation, and approve a merger,
consolidation with another company or sale of all or substantially all of our
assets, without the need to obtain approval of any other shareholders. See
"Principal Shareholders" and "Description of Securities."
Competition.
Numerous large, well-financed firms with large cash reserves are
engaged in the acquisition of companies and businesses. We expect competition to
be intense for available target businesses.
Lack of Facilities.
Our offices are located within a suite of offices leased by GreenGold
International, Inc., a company owned and operated by the GreenGold Group. The
use of the facilities is provided to us at no charge and we do not intend to
rent other office space until an operating company is identified and acquired.
The lack of any separate facilities for Baxter Capital's operations may work to
Baxter Capital's future detriment. See "Property."
Potential Sales Pursuant to Rule 144.
All 1,000,000 shares of our common stock currently outstanding are
"restricted securities" as that term is defined in Rule 144 promulgated under
the Securities Act of 1933, as amended. Currently and until August 13, 2000,
none of these shares of common stock are eligible for resale under Rule 144. In
general, under Rule 144 a person (or persons whose shares are aggregated) who
has satisfied a one-year holding period may sell within any three month period,
a number of shares which does not exceed the greater of 1% of the then
outstanding shares of common stock, or the average weekly trading volume during
the four calendar weeks prior to such sale, provided that the other requirements
of Rule 144 are satisfied. Rule 144 also permits, under certain circumstances,
the sale of shares without any quantity limitation by a person who is not an
affiliate of Baxter Capital and who has satisfied a two-year holding period.
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We may, but are under no obligation to, file a registration statement
under the Securities Act of 1933, as amended, relating to the resale of our
outstanding shares.
We are unable to predict the effect that sales of our securities under
Rule 144 or pursuant to a registration statement filed under the Securities Act,
may have on the then prevailing market price of our common stock. You should
expect, however, that the sale of any substantial number of shares of common
stock will depress the market price of the common stock.
Market for the Common Stock.
No shares of our common stock have been registered with the Commission
or any state securities agency or authority. There is no current trading market
for our common stock and we do not expect one to develop until at least some
shares of the common stock are registered under the Securities Act or can be
sold without registration pursuant to Rule 144. Although we intend to apply for
listing on The Nasdaq Stock Market's OTC Bulletin Board, there is no currently
quoted bid or asked price or last sale price for our common stock. We cannot
assure you about when Nasdaq will list our common stock on the OTC Bulletin
Board or when broker-dealers will agree to make a market in our common stock.
Holders of our common stock should expect that they will have to hold our shares
indefinitely. See "Market Price of and Dividends on the Registrant's Common
Equity and Other Shareholder Matters."
Lack of Market Research or Marketing Organization.
We have not conducted, nor have others made available to us, any market
research that would indicate that market demand exists for shell corporations
for the purpose of engaging in shell reorganizations. Moreover, we do not plan
to conduct or obtain any such market research.
Lack of Diversification.
Our proposed operations, even if successful, will likely result in the
acquisition of an operating company operating in a single industry group. This
inability to diversify our activities may subject us to economic fluctuations
within a particular business or industry and therefore increase the risks
associated with our operations.
Taxation.
In considering a potential shell reorganization, we will consider the
federal and state tax consequences of the transaction and will seek to structure
the transaction so as to result in tax-free treatment for the operating company,
its shareholders, Baxter Capital and our shareholders, as the case may be,
depending on the structure of the shell reorganization. However, we cannot
assure you that the structure employed in the shell reorganization will meet the
statutory requirements of a tax-free reorganization or that the parties will
obtain the intended tax-free treatment upon a transfer of stock or assets. A
non-qualifying
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reorganization could result in the imposition of both federal and state taxes
which may have an adverse effect on both parties to the transaction, as well as
their respective shareholders.
Requirement of Audited Financial Statements May Narrow Possible Target
Companies.
Once we are subject to the reporting requirements of the Securities
Exchange Act of 1934, as amended, we will be required to file audited financial
statements with the Securities and Exchange Commission in connection with any
shell reorganization. One or more operating companies that would be attractive
business opportunities may choose to forego the possibility of a business
combination with us, rather than incur the expenses associated with preparing
audited financial statements.
Conflicts of Interest.
Certain conflicts of interest exist between Baxter Capital and our
controlling shareholders, the GreenGold Group, who also comprise all of our
officers and directors. The GreenGold Group has other business interests to
which they currently devote the vast majority of their attention, and they are
expected to continue to maintain these interests. As a result, conflicts of
interest may arise that can be resolved only through their exercise of judgment
in a manner which is consistent with their fiduciary duties to Baxter Capital.
In particular, the GreenGold Group are also controlling shareholders,
directors and officers of two other blind pool or blank check companies, which
have a structure and a business plan identical to ours. These companies have
also filed Registration Statements under the Securities Exchange Act of 1934
simultaneously with the filing of this Registration Statement. It is likely that
the GreenGold Group will form or acquire additional blind pool or blank check
companies in the future, with business plans similar or identical to ours.
Accordingly, it is likely that companies controlled by the GreenGold Group will
be in direct competition with us for available business opportunities.
In addition, the GreenGold Group may actively negotiate or otherwise
consent to the purchase of a portion of their common stock as a condition to, or
in connection with, a proposed merger or acquisition transaction. In this
process, they may consider their own personal pecuniary benefit rather than the
best interests of other shareholders. Our other shareholders are not expected to
be afforded the opportunity to approve or consent to any particular stock
buy-out transaction.
Possible Need for Additional Financing.
Our funds are nominal and our ability to access additional funds is
extremely limited. The lack of capital may prevent us from taking advantage of
available business opportunities. Even if we obtain sufficient funds to acquire
an interest in, or complete a transaction with, an operating company, we may not
have enough capital to exploit the opportunity. Our ultimate success may depend
upon our ability to raise additional capital.
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We have not investigated the availability, source, or terms that might
govern the acquisition of additional capital and we will not do so until we
determine that there is a need for additional financing. If we need additional
capital we cannot assure you that funds will be available from any source or, if
available, that they can be obtained on acceptable terms. If funds are not
available, our opportunities for acquisitions and growth will be limited.
History.
The GreenGold Group acquired control of Baxter Capital in August of
1999 for the purpose of engaging in a shell reorganization with an operating
company. We have no operating history, revenues from operations, or assets other
than a nominal amount of cash from the private sale of stock and money loaned to
us by a company controlled by the GreenGold Group. We face all of the risks of a
new business and the special risks inherent in the investigation, acquisition,
or involvement in a new business opportunity. We must be regarded as a new or
"start-up" venture with all of the unforeseen costs, expenses, problems, and
difficulties to which such ventures are subject.
No Assurance of Success or Profitability.
We cannot assure you that we will be able to enter into a shell
reorganization with a suitable operating company or, even if we do complete a
shell reorganization, that the operating company will generate revenues or
profits, or that the market price and liquidity of our outstanding shares will
permit the sale of your shares at your cost or a profit.
Leveraged Transactions.
We may leverage the acquisition of an operating company in a shell
reorganization, i.e., the acquisition may be financed by borrowing against the
assets of the operating company, or against projected future revenues or
profits. Such a financing may increase our exposure to losses if we are unable
to generate sufficient revenues and profits to service the loan. If we are
unable to service the loan we could lose all or of a portion of the assets of
the operating company. We cannot assure you that we will generate sufficient
revenues or profits to cover our debt-related and other expenses.
No Foreseeable Dividends.
We have never paid any dividends on our common stock and we do not
anticipate paying any dividends in the foreseeable future.
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Federal and State Securities or "Blue Sky" Law Considerations Affecting Resale
of Our Securities.
In addition to the typical restrictions on the offer and sale of our
securities under federal and state securities or "blue sky" laws, our common
stock is subject to additional restrictions applicable to "penny stocks" which
include securities issued by companies which are in the development stage that
have no specific business plan or purpose or that have indicated that their plan
is to merge with an unidentified company not engaged in a specific industry or
activity. These types of companies are also sometimes called "blind pools" or
"blank check" companies. An investor acquiring any of our shares should be aware
that there are significant restrictions and requirements under federal and
certain state securities or "blue-sky" laws on the purchase and sale of "penny
stock" and the shares of "blank check" and "blind pool" companies. For example,
the "penny stock" rules promulgated under the Securities Exchange Act requires
additional disclosure by broker-dealers in connection with trades involving a
stock defined as a "penny stock" (generally, any non-Nasdaq listed equity
security that has a market price of less than $5 or any equity security of a
"blank check" or "blind pool" company). Such rules require the delivery, prior
to any purchase and sale transaction, of a disclosure schedule explaining the
penny stock market and the risks associated therewith and impose various sales
practice requirements on broker-dealers who sell penny stocks to any persons
other than established customers and accredited investors. In addition, under
the laws of certain states, "penny stocks" and the shares of "blank check" or
"blind pool" companies are prohibited or severely restricted. Accordingly, the
liquidity of our shares is further restricted making the market for the resale
of our shares extremely limited.
Elimination of Liability of Directors and Officers
Our articles of incorporation eliminates the liability of our directors
for monetary dames for breach of duty as a director, subject to certain
exceptions. In addition, our articles of incorporation provide that we will
indemnify, under certain conditions, our directors, officers, employees and
agents against liability. These provisions reduce the likelihood of a successful
derivative litigation against our directors and may discourage or deter our
shareholders or management from suing our directors, officers and agents even
though such an action, if successful, might benefit us.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
Plan of Operations
We were organized in June, 1998 for the purpose of engaging in any
activity permitted under the laws of the United States and of the State of
Florida. In August 1999, the GreenGold Group acquired a controlling interest in
our common stock for the purpose of listing our common stock on the OTC
electronic bulletin board of the Nasdaq Stock Market, Inc. to facilitate a
public market for the common stock. We intend to use our common stock to acquire
a controlling equity interest in or the assets of a suitable operating company.
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The registration of our common stock under the Securities Exchange Act of 1934
is one step that we are taking to implement our business plan. We are in the
business development stage and have no revenues or operations. Since our
incorporation, we have not conducted any business other than in connection with
our organization and the implementation of our business plan. We have only
nominal assets from the sale of our stock to the GreenGold Group and certain
other investors in a private transaction. We anticipate that we will obtain the
additional funds to implement our business plan from capital contributions or
loans made by the GreenGold Group, although they are under no obligation to
provide us with any additional funding.
Forward Looking Statements
This Registration Statement contains forward-looking statements that
are based on assumptions believed by us to be reasonable in light of information
available to us. When used in this Registration Statement, the words "believe,"
"endeavor," "expect," "anticipate," "estimate," "intends," and similar
expressions are intended to identify forward-looking statements. Such statements
are subject to certain risks, uncertainties and assumptions which described
under the caption "Risk Factors," above. Should one or more of those risks or
uncertainties materialize, or should our underlying assumptions prove incorrect,
actual results may vary materially from those anticipated, estimated, or
projected. We urge anyone considering an investment in our shares not to place
undue reliance on any such forward-looking statements.
ITEM 3. DESCRIPTION OF PROPERTY
Through an oral agreement with the GreenGold Group, who are our
controlling shareholders and all of our officers and directors, we are currently
operating from the offices of GreenGold International, Inc., which are located
at 2 South Biscayne Boulevard, Suite 2470, Miami, FL, 33131, at no cost to us
for the use of office space, equipment rental or phone usage. We do not
anticipate acquiring separate office facilities until such time as we complete a
shell reorganization transaction with an operating company.
ITEM 4. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.
The following table sets forth certain information regarding the
beneficial ownership of the shares of our common stock as of October 31, 1999 by
(i) each person who is known by us to be the beneficial owner of more than five
percent (5%) of the issued and outstanding shares of our common stock, (ii) each
of our directors and executive officers and (iii) all directors and executive
officers as a group.
Name and Address Number of Shares Percentage Owned
Kenneth Greenberg (1)(2) 476,600 47.66%
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Peter Goldstein (1) 476,600 47.66%
Nancy Greenberg (1)(2) 476,600 47.66%
All officers and directors as a
group (3) 953,200 95.32%
(1) Address is 2 South Biscayne Boulevard, Suite 2470, Miami, FL, 33131.
(2) Includes beneficial ownership of 476,600 shares of common stock held by
Kenneth Greenberg and Nancy Greenberg as joint tenants by the entirety.
(3) Includes 476,600 shares of common stock held by Kenneth Greenberg, our
chairman of the board and president and 476,600 shares of common stock
held by Peter Goldstein, our secretary, treasurer and executive vice-
president .
ITEM 5. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS.
Set forth below are our directors and officers:
Name Age Office
Kenneth Greenberg 43 chairman of the board; president;
and a director
Peter Goldstein 33 executive-vice president;
secretary; treasurer; and a
director
Kenneth C. Greenberg
Since March 1998, Mr. Greenberg has served as a principal shareholder,
president, treasurer and a director of GreenGold International, Inc., a
corporation engaged in business analysis, strategic growth and planning, and
corporate reengineering for small and medium sized businesses. From April 1996
until March 1998, Mr. Greenberg was engaged as an independent business
consultant. From August 1995 until April 1996, Mr. Greenberg served as the chief
operating officer of Safe Alternative Corporation of America, Inc., a publicly
traded corporation engaged in the development and marketing of a line of
biodegradable, water-washable paint strippers for retail, commercial and
industrial use. From March 1995 until August 1995, Mr. Greenberg served as the
chief operating officer and vice-president of Italia Collection, Inc., a wholly
owned subsidiary of Interiors, Inc., a publicly traded company. Italia
Collection, Inc. is engaged in the manufacture and marketing of ceramic vases
and bowls, sculpture, lamps, fine antique reproductions, picture frames and
mirrors. From March 1994 until February 1995, Mr. Greenberg served as the
Vice-President of Sales of Far East Ventures Inc., a corporation engaged
primarily in the promotion of the development of trade relations between
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companies in the United States and China. From July 1993 to March 1994, Mr.
Greenberg served as the Assistant to the President of Central Florida
Investments, a corporation with approximately $400 million in annual revenues,
engaged in the time share resort industry. From 1978 to July 1993, Mr. Greenberg
served as the managing director and president of Sun Business Group, Inc., a
corporation in the business brokerage industry and achieved the highest industry
designation as a Certified Business Intermediary.
Mr. Greenberg earned his Bachelor's Degree form the University of
Florida in 1978 and currently holds a real estate broker's license in the state
of Florida.
Peter Goldstein
Since March 1998, Mr. Goldstein has served as a principal shareholder,
executive vice-president, secretary and a director of GreenGold International,
Inc., a corporation engaged in business analysis, strategic growth and planning
and corporate reengineering for small and medium sized businesses. From 1996
until March 1998, Mr. Goldstein served as the president of Global Business
Resources, Inc., a corporation engaged in business consulting, analysis and
project management services to small and medium sized businesses. From 1989 to
1995, Mr. Goldstein served as the president of Fine Herbs Corporation, a
corporation that he founded which engaged in the distribution of specialty
produce to national and regional based hotels, restaurants, wholesalers, and
supermarket chains. Mr. Goldstein served as the Director of Operations for the
Rainbow Room Restaurants, located in New York City, New York. From 1988 to 1989,
Mr. Goldstein managed the purchasing, operations and maintenance of the
restaurant complex.
In 1997, Mr. Goldstein earned his Masters in Business Administration in
International Business from the University of Miami. Mr. Goldstein attended
Miami Dade Community College where he earned his Associates Degree in Business
Administration, with honors, in 1995. Mr. Goldstein began his study of business
administration at the University of Minnesota in 1982, but did not earn a degree
from that institution.
Each of our directors and officers hold office until his respective
successor is elected and qualified or until his earlier resignation in the
manner provided in our bylaws.
ITEM 6. EXECUTIVE COMPENSATION
We do not pay any compensation to our officers or directors, including
by way of salary or stock, and do not make any employee benefits or perquisites
available to any officer, director or employee. We do not anticipate paying any
compensation until after we have completed the acquisition of an operating
company.
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ITEM 7. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
We do not currently have or intend to enter into any agreement with any
of our officers, directors or controlling shareholders, other than the oral
agreement between us and GreenGold to use the offices and certain administrative
resources, such as telephone, mailing and secretarial assistance, of their
company, GreenGold International, Inc., without charge until we have acquired an
operating company in a shell reorganization.
ITEM 8. DESCRIPTION OF SECURITIES.
Common Stock
Under our articles of incorporation, we are authorized to issue
1,000,000 shares of common stock, $.001 par value. As of October 31, 1999, all
1,000,000 shares were issued and outstanding and held of record by 49
shareholders. Holders of shares of common stock are entitled to one vote per
share on all matters to be voted upon by the shareholders generally. The
approval of proposals submitted to shareholders at a meeting other than for the
election of directors requires the favorable vote of a majority of the shares
voting, except in the case of certain fundamental matters (such as certain
amendments to the articles of incorporation, and certain mergers and
reorganizations), in which cases Florida law requires the favorable vote of at
least a majority of all outstanding shares. Shareholders are entitled to receive
such dividends as may be declared from time to time by our board of directors
out of funds legally available therefor, and in the event of that we liquidate
dissolve or wind up to share ratably in all assets remaining after payment of
liabilities. Holders of shares of common stock have no preemptive, conversion,
subscription or cumulative voting rights.
Other Securities
We are not currently authorized to issue other securities and we do not
contemplate that other securities will be issued in the foreseeable future.
However, other securities may be authorized in accordance with Florida law and
our articles of incorporation , if so required for the acquisition of a business
opportunity, or the financing thereof, in which case such other securities will
be authorized and issued following the amendment of our articles of
incorporation by vote of our shareholders and the board of directors upon such
terms, conditions, limitations and preferences as the board and shareholders may
deem appropriate. Because of their share ownership and status as all of the
members of our board of directors, the GreenGold Group could effect an amendment
to our articles without the need to obtain the vote of any other shareholder.
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PART II
ITEM 1 MARKET PRICE OF AND DIVIDENDS ON THE REGISTRANT'S COMMON EQUITY AND
OTHER SHAREHOLDER MATTERS.
No shares of our common stock have been registered with the Securities
and Exchange Commission or any state securities agency or authority. We intend
to apply to The Nasdaq Stock Market, Inc. to list our shares for quotation on
their OTC Bulletin Board. We cannot assure you when or if our application will
be accepted. If accepted for listing, current quoted bid and asked, and last
sale prices for our shares of common stock will be available on OTC Bulletin
Board.
There is no existing trading market for our common stock and none is
expected to develop until the common stock is approved for listing on the OTC
Bulletin Board and sufficient shares of common stock may be publicly-traded
pursuant to Rule 144 under the Securities Act or upon registration for resale
under the Securities Act.
If and when our common stock is traded in the over-the-counter market,
most likely the shares will be subject to the provisions of Section 15(g) and
Rule 15g-9 of the Securities Exchange Act of 1934, commonly referred to as the
"penny stock" rule. Section 15(g) sets forth certain requirements for
transactions in penny stocks and Rule 15g9(d)(1) incorporates the definition of
penny stock as that term is used in Rule 3a51-1 of the Exchange Act.
The Commission generally defines a penny stock to be any equity
security that has a market price less than $5.00 per share, as well as the
shares of companies that are considered blind pools or blank check companies,
subject to certain exceptions. Rule 3a51-1 provides that any equity security is
considered to be a penny stock unless that security is: registered and traded on
a national securities exchange meeting specified criteria set by the Commission;
authorized for quotation on one of the trading systems (not including the OTC
Bulletin Board) of The Nasdaq Stock Market; issued by a registered investment
company; excluded from the definition on the basis of price (at least $5.00 per
share) or the issuer's net tangible assets; or exempted from the definition by
the Commission. If the Company's shares are deemed to be a penny stock, trading
in the shares will be subject to additional sales practice requirements on
broker-dealers who sell penny stocks to persons other than established customers
and accredited investors, generally persons with assets in excess of $1,000,000
or annual income exceeding $200,000, or $300,000 together with their spouse. In
addition, several states restrict or prohibit trading in penny stocks and shares
of blank check and blind pool companies.
For transactions covered by the penny stock rules, broker-dealers must
make a special suitability determination for the purchase of such securities and
must have received the purchaser's written consent to the transaction prior to
the purchase. Additionally, for any transaction involving a penny stock, unless
exempt, the rules require the delivery, prior to the first transaction, of a
risk disclosure document relating to the penny stock market. A broker-dealer
also must disclose the commissions payable to both the broker-dealer and the
registered representative, and current quotations for the securities. Finally,
monthly statements must be sent to customers purchasing penny stocks disclosing
recent price information for the penny stocks held in their account and
information on the limited market in penny stocks. These rules may make it less
likely that a broker-dealer will act as a market maker for our shares or agree
15
<PAGE>
to engage in transactions for the purchase and sale of our shares. Should this
occur our shareholders will have increased difficulty in effecting a resale of
their shares.
As of October 31, 1999, there were 49 record holders of the Company's
Common Stock.
We have not paid any cash dividends since our inception and we do not
contemplate paying dividends in the foreseeable future, even after effecting a
shell reorganization with an operating company. We anticipate that earnings, if
any, will be retained for the operation of our business.
ITEM 2. LEGAL PROCEEDINGS.
There are no pending legal proceedings to which we are a party or to
which any of our property interests are subject.
ITEM 3. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
Not applicable.
ITEM 4. RECENT SALES OF UNREGISTERED SECURITIES.
Effective as of August 13, 1999, we issued an aggregate of 1,000,000
shares of our common stock in a private offering exempt from registration under
the Securities Act pursuant to Section 4(2) thereof for the total consideration
of $1,000 to 49 investors, including 476,600 shares of common stock issued to
each of Kenneth Greenberg and Peter Goldstein. We issued the balance of the
shares to 49 individuals, each of whom are the direct relatives, longstanding
friends and/or acquaintances of Mr. Greenberg and/or Mr. Goldstein. We offered
the shares ourselves and no fee or discount was given to any underwriter,
placement agent or other person in connection with the private placement
transactions. Except as described in the preceding sentence, we have not
offered, sold or issued any securities.
ITEM 5. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Under our articles of incorporation we are required to indemnify our
officers, directors, employees and agents under certain circumstances as
follows:
"The Corporation shall indemnify a Director or Officer of the
Corporation who is wholly successful, on the merits or otherwise, in the defense
of any proceedings to which the director or officer was a party because the
16
<PAGE>
director or officer is or was a director or officer of the Corporation against
reasonable attorneys fees and expenses incurred by the director or officer in
connection with the proceeding. The Corporation may indemnify an individual made
a party to a proceeding because the individual is or was a director, officer,
employee or agent of the Corporation against liability if authorized in the
specific case after determination, in the manner required by the board of
directors, that indemnification of the director, officer, employee or agent, as
the case may be, is permissible under circumstances because the director,
officer, employee or agent has met the standard of conduct set forth by the
board of directors. The indemnification and advancement of attorney's fees and
expense for directors, officers, employees and agents of the Corporation shall
apply when such persons are serving at the Corporation's request while director,
officer, employee or agent of the Corporation, as the case may be, as a
director, officer, partner, trustee, employee or agent of another foreign or
domestic Corporation, partnership, joint venture, trust, employee benefit plan
or another enterprise, whether or not for profit, as well as in their official
capacity with the Corporation. The Corporation also may pay for or reimburse the
reasonable attorney fees and expenses incurred by a director, officer, employee
or agent of the Corporation who is a party to a proceeding in advance of final
disposition of the proceeding. The corporation may also purchase and maintain
insurance on behalf of an individual arising from the individual status as a
director, officer, employee or agent of the Corporation, whether or not the
Corporation would have power to indemnify the individual against the same
liability under the law. All references in this Article of Incorporation are
deemed to include any amendment or successor thereto. Nothing contained in these
Articles of Incorporation should limit or preclude the exercise of any right
relating to indemnification or advance attorney's fees and expenses to any
person who is or was a director, officer, employee or agent of the Corporation
or the ability of the Corporation otherwise to indemnify or advance expenses to
any such person by contract or by any other matter. If any word, cause or
sentence of the foregoing provisions regarding indemnification or advancement of
the attorneys fees or expenses shall be held invalid as contrary to law or
public policy, it shall be severable and the provisions remaining should not be
otherwise affected. All references in these Articles of Incorporation to
"director", "officer", "employee" and "agent" shall include the heiress,
estates, executors, administrators and personal representatives of such
persons."
Indemnity Agreement
Our articles of incorporation provide that we may indemnify our
directors, officers, employees or agents to the fullest extent permitted by law.
We have agreed to provide such indemnification to our incorporator, Elsie
Sanchez, who also served as an officer and director, pursuant to a written
indemnification agreement which is an exhibit to this Registration Statement and
incorporated herein by reference.
17
<PAGE>
PART F/S
INDEX TO FINANCIAL STATEMENTS
Description
Page
Independent Auditors' Reportf-1
Balance Sheet...............................................................f-2
Statement of Operations.....................................................f-3
Statement of Changes in Stockholders' Deficiency............................f-4
Statement of Cash Flows.....................................................f-5
Notes to Financial Statements...............................................f-6
18
<PAGE>
INDEPENDENT AUDITORS' REPORT
To the Board of Directors of:
BAXTER CAPITAL COMPANY
(A Development Stage Enterprise)
We have audited the accompanying balance sheet of BAXTER CAPITAL COMPANY, (a
development stage enterprise) as of October 31, 1999 and the related statements
of operations, changes in stockholders' deficiency and cash flows for the period
from August 13, 1999 (inception of development stage) to October 31, 1999. These
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audit.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly in all
material respects, the financial position of BAXTER CAPITAL COMPANY, (a
development stage enterprise) as of October 31, 1999, and the results of its
operations and its cash flows for the period from August 13, 1999 (inception of
development stage) to October 31, 1999 in conformity with generally accepted
accounting principles.
WEINBERG & COMPANY, P.A.
Boca Raton, Florida
November 18, 1999
f-1
<PAGE>
BAXTER CAPITAL COMPANY
(A DEVELOPMENT STAGE ENTERPRISE)
BALANCE SHEET
OCTOBER 31, 1999
- - - -------------------------------------------------------------------------------
ASSETS
Current assets
Cash $ 150
Prepaid expenses 415
--- ----------
Total current assets 565
--- ----------
TOTAL ASSETS $ 565
=== ==========
LIABILITIES AND STOCKHOLDERS' DEFICIENCY
LIABILITIES
Current liabilities
Due to related party $ 1,667
--- ----------
TOTAL LIABILITIES 1,667
--- ----------
STOCKHOLDERS' DEFICIENCY
Common stock, $.001 par value, 1,000,000 shares authorized,
1,000,000 shares issued and outstanding 1,000
Deficit accumulated during development stage (2,102)
--- ----------
TOTAL STOCKHOLDERS' DEFICIENCY (1,102)
--- ----------
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIENCY $ 565
=== ==========
See accompanying notes to financial statements
f-2
<PAGE>
BAXTER CAPITAL COMPANY
(A DEVELOPMENT STAGE ENTERPRISE)
STATEMENT OF OPERATIONS
FROM AUGUST 13, 1999 (INCEPTION OF
DEVELOPMENT STAGE) TO OCTOBER 31, 1999
- - - --------------------------------------------------------------------------------
REVENUES $ -
-- --------------
EXPENSES
Organization fees 850
Professional fees 1,252
-- --------------
TOTAL EXPENSES 2,102
-- --------------
NET LOSS $ (2,102)
== ==============
Net loss per share - basic and diluted $ (0.002)
== ==============
Weighted average number of shares
outstanding during the period -
basic and diluted 1,000,000
== ==============
See accompanying notes to financial statements
f-3
<PAGE>
================================================================================
BAXTER CAPITAL COMPANY
================================================================================
(A DEVELOPMENT STAGE ENTERPRISE)
STATEMENT OF CHANGES IN STOCKHOLDERS' DEFICIENCY
FROM AUGUST 13, 1999 (INCEPTION OF
DEVELOPMENT STAGE) TO OCTOBER 31, 1999
<TABLE>
<CAPTION>
DEFICIT
ACCUMULATED
DURING
COMMON STOCK DEVELOPMENT
SHARES AMOUNT STAGE TOTAL
- - - -----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common stock issued for cash 1,000,000 $ 1,000 $ - $ 1,000
Net loss 1999 - - (2,102) (2,102)
-------------- ------------- ----------- ------------
BALANCE, OCTOBER 31, 1999 1,000,000 $ 1,000 $ (2,102) $ (1,102)
============== ============= ============ ============
</TABLE>
See accompanying notes to financial statements
f-4
<PAGE>
BAXTER CAPITAL COMPANY
(A DEVELOPMENT STAGE ENTERPRISE)
STATEMENT OF CASH FLOWS
FROM AUGUST 13, 1999 (INCEPTION OF
DEVELOPMENT STAGE) TO OCTOBER 31, 1999
- - - --------------------------------------------------------------------------------
Cash flows from operating activities
Net loss $ (2,102)
Adjustments to reconcile net loss to net
cash used in operating activities:
Changes in operating assets
and liabilities:
(Increase) decrease in:
Prepaid expenses (415)
-----------
Net cash used in operating activities (2,517)
-----------
Cash flows from investing activities -
-----------
Cash flows from financing activities
Proceeds from issuance of common stock 1,000
Advances from related party 1,667
-----------
Net cash provided by financing activities 2,667
-----------
Net increase in cash 150
Cash and cash equivalents at beginning of year -
-----------
CASH AND CASH EQUIVALENTS AT END OF YEAR $ 150
===========
See accompanying notes to financial statements
f-5
<PAGE>
BAXTER CAPITAL COMPANY
(A DEVELOPMENT STAGE ENTERPRISE)
NOTES TO FINANCIAL STATEMENTS
AS OF OCTOBER 31, 1999
NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND ORGANIZATION
(A) Organization
Baxter Capital Co. (a development stage enterprise) (the
"Company") was incorporated in Florida on June 11, 1998
and has been inactive until August 13, 1999 (inception
of development stage). The Company intends to serve as a
vehicle to effect an asset acquisition, merger, exchange
of capital stock, or other business combination with a
domestic or foreign business. At October 31, 1999, the
Company had not yet commenced any formal business
operations, and all activity to date relates to the
Company's formation, capital stock issuances,
professional fees with regard to proposed Securities and
Exchange Commission filings and identification of target
businesses. The Company's fiscal year end is October 31.
The Company's ability to commence operations is
contingent upon its ability to identify a prospective
target business or raise the capital it may require
through the issuance of equity securities, debt
securities, bank borrowings or a combination thereof.
(B) Use of Estimates
In preparing financial statements in conformity with
generally accepted accounting principles, management is
required to make estimates and assumptions that affect
the reported amounts of assets and liabilities and the
disclosure of contingent assets and liabilities at the
date of the financial statements and revenues and
expenses during the reported period. Actual results
could differ from those estimates.
(C) Cash and Cash Equivalents
For purposes of the cash flow statements, the Company
considers all highly liquid investments with original
maturities of three months or less at the time of
purchase to be cash equivalents.
(D) Income Taxes
The Company accounts for income taxes under the
Financial Accounting Standards Board Statement of
Financial Accounting Standards No. 109 "Accounting for
Income Taxes" ('Statement 109"). Under Statement 109,
deferred tax assets and liabilities are recognized for
the future tax consequences attributable to differences
between the financial statement carrying amounts of
existing assets and liabilities and their respective tax
bases. Deferred tax assets and liabilities are measured
using enacted tax rates expected to apply to taxable
income in the years in which those temporary differences
are expected to be recovered or settled. Under Statement
109, the effect on deferred tax assets and liabilities
of a change in tax rates is recognized in income in the
f-6
<PAGE>
period that includes the enactment date. There was no
current income tax expense in the period ended October
31, 1999 due to the net loss. Any deferred tax asset
resulting from the net loss has been fully offset by a
valuation allowance.
(E) Earnings Per Share
Net loss per common share for the period from August 13,
1999 (inception of development stage) to October 31,
1999 is computed based upon the weighted average common
shares outstanding as defined by Financial Accounting
Standards No. 128, "Earnings Per Share". There were no
common stock equivalents outstanding at October 31,
1999.
NOTE 2 PREPAID EXPENSES
Prepaid expenses at October 31, 1999 represent prepaid legal
fees.
NOTE 3 DUE TO RELATED PARTY
The amount due to related party represents advances made to
the Company by an entity controlled by the Company's principal
stockholders. The amount is non-interest bearing, unsecured
and due on demand.
NOTE 4 STOCKHOLDERS' DEFICIENCY
The Company is authorized to issue 1,000,000 shares of common
stock at $.001 par value. In August 1999, the Company issued
1,000,000 shares of its common stock to various stockholders
pursuant to Section 4 (2) of the Securities Act of 1933, as
amended, for an aggregate consideration of $1,000.
f-7
<PAGE>
PART III
INDEX TO EXHIBITS
Exhibit Exhibit Description Page
- - - ------- ------------------- ----
No.
-----
3.1 Articles of Incorporation of the Company 21
3.2 Articles of Amendment to Articles of Incorporation of the Company 25
3.3 Amended and Restated Bylaws of the Company 27
4.1 Specimen of Common Stock Certificate 39
10.1 Indemnity Agreement 41
27.1 Financial Data Schedule 47
19
<PAGE>
SIGNATURES
In accordance with Section 12 of the Securities Exchange Act of 1934,
the registrant caused this registration statement to be signed on its behalf by
the undersigned, thereunto duly authorized.
BAXTER CAPITAL COMPANY
a Florida corporation
By: /s/ KENNETH GREENBERG
Name: Kenneth Greenberg
Title: Chairman of the Board;
President
Dated December 7, 1999
20
<PAGE>
INDEX TO EXHIBITS
Exhibit Exhibit Description Page
- - - ------- ------------------- ----
No.
---
3.1 Articles of Incorporation of the Company 21
3.2 Articles of Amendment to Articles of Incorporation of the Company 25
3.3 Amended and Restated Bylaws of the Company 27
4.1 Specimen of Common Stock Certificate 39
10.1 Indemnity Agreement 41
27.1 Financial Data Schedule 47
21
<PAGE>
EXHIBIT 3.1
ARTICLES OF INCORPORATION
OF
BAXTER CAPITAL COMPANY
The undersigned subscriber to these Articles of Incorporation is a
natural person competent to contract and hereby form a Corporation for profit
under Chapter 607 of the Florida Statutes.
ARTICLE 1 - NAME
----------------
The name of the Corporation is Baxter Capital Co,, (hereinafter,
"Corporation").
ARTICLE 2 - PURPOSE OF CORPORATION
----------------------------------
The Corporation shall engage in any activity or business permitted
under the laws of the United States and of the State of Florida.
ARTICLE 3 - PRINCIPAL OFFICE
----------------------------
The address of the principal office of this Corporation is 343 Almeria
Avenue, Coral Gables, Florida 33134.
ARTICLE 4 - INCORPORATOR
------------------------
The name and street address of the incorporator of this Corporation is:
Elsie Sanchez
343 Almeria Avenue
Coral Gables, Florida 33134
ARTICLE 5 - CORPORATE CAPITALIZATION
------------------------------------
5.1 The maximum number of shares that this Corporation is authorized to
have outstanding at any time is ONE MILLION (1,000,000) Shares of Common Stock,
each share having the par value of ONE TENTH OF ONE CENT ($0.001).
22
<PAGE>
5.2 No holder of shares of stock of any class shall have any preemptive
right to subscribe to or purchase any additional shares of any class, or any
bonds or convertible securities of any nature; provided, however, that the Board
of Director(s) may, in authorizing the issuance of shares of stock of any class,
confer any preemptive right that the Board of Director(s) may deem advisable in
connection with such issuance.
5.3 The Board of Director(s) of the Corporation may authorize the issuance
from time to time of shares of its stock of any class, whether now or hereafter
authorized, or securities convertible into shares of its stock of any class,
whether now or hereafter authorized, for such consideration as the Board of
Director(s) may deem advisable, subject to such restrictions or limitations, if
any, as may be set forth in the bylaws of the Corporation.
5.4 The Board of Directors(s) of the Corporation may, by Restated Articles
of Incorporation, classify or reclassify any unissued stock from time to time by
setting or changing the preferences, conversions or other rights, voting powers,
restrictions, limitations as to dividends, qualifications, or term or conditions
of redemption of the stock.
ARTICLE 6 - SHAREHOLDERS' RESTRICTIVE AGREEMENT
-----------------------------------------------
All of the shares of stock of this Corporation may be subject to a
Shareholders' Restrictive Agreement containing numerous restrictions on the
rights of shareholders of the Corporation and transferability of the shares of
stock of the Corporation. A copy of the Shareholders' Restrictive Agreement, if
any, is on file at the principal office of the Corporation.
ARTICLE 7 - POWERS OF CORPORATION
---------------------------------
The Corporation shall have the same powers as an individual to do all
things necessary or convenient to carry out its business and affairs, subject to
any limitations or restrictions imposed by applicable law or these Articles of
Incorporation.
ARTICLE 8 - TERM OF EXISTENCE
-----------------------------
This Corporation shall have perpetual existence.
ARTICLE 9 - REGISTERED OWNER(S)
-------------------------------
The Corporation, to the extent permitted by law, shall be entitled to
treat the person in whose name any share or right is registered on the books of
the Corporation as the owner thereto, for all purposes, and except as may be
agreed in writing by the Corporation, the Corporation shall not be bound to
recognize any equitable or other claim to, or interest in such share or right on
the part of any other person, whether or not the Corporation shall have notice
thereof.
23
<PAGE>
ARTICLE 1 - REGISTERED OFFICE AND REGISTERED AGENT
--------------------------------------------------
The initial address of registered office of this Corporation is
AmeriLawyer(R), located at 343 Almeria Avenue, Coral Gables, Florida 33134. The
name and address of the registered agent of this Corporation is AmeriLawyer(R),
343 Almeria Avenue, Coral Gables, Florida 33134.
ARTICLE 11 - BYLAWS
-------------------
The Board of Director(s) of the Corporation shall have power, without
the assent or vote of the shareholders, to make, alter, amend or repeal the
Bylaws of the Corporation, but the affirmative vote of a number of Directors
equal to a majority of the number who would constitute a full Board of
Director(s) at the time of such action shall be necessary to take any action for
the making, alteration, amendment or repeal of the Bylaws.
ARTICLE 12 - EFFECTIVE DATE
---------------------------
These Articles of Incorporation shall be effective immediately upon
approval of the Secretary of State, State of Florida.
ARTICLE 13 - AMENDMENT
----------------------
The Corporation reserves the right to amend, alter, change or repeal
any provision contained in these Articles of Incorporation, or in any amendment
hereto, or to add any provision to these Articles of Incorporation or to any
amendment hereto, in any manner now or hereafter prescribed or permitted by the
provisions of any applicable statute of the State of Florida, and all rights
conferred upon shareholders in these Articles of Incorporation or any amendment
hereto are granted subject to this reservation.
ARTICLE 14 - INDEMNIFICATION
----------------------------
The Corporation shall indemnify a director or officer of the
Corporation who was wholly successful, on the merits or otherwise, in the
defense of any proceeding to which the director or officer was a party because
the director or officer is or was a director or officer of the Corporation
against reasonable attorney fees and expenses incurred by the director or
officer in connection with the proceeding. The Corporation may indemnify an
individual made a party to a proceeding because the individual is or was a
director, officer, employee or agent of the Corporation against liability if
authorized in the specific case after determination, in the manner required by
the board of directors, that indemnification of the director, officer, employee
or agent, as the case may be, is permissible in the circumstances because the
director, officer, employee or agent has met the standard of conduct set forth
by the board of directors. The indemnification and advancement of attorney fees
and expenses for directors, officers, employees and agent of the Corporation
shall apply when such persons are serving at the Corporation's request while a
director, officer, partner, trustee, employee or agent of another foreign or
domestic Corporation, partnership, joint venture, trust, employee benefit plan
or other enterprise, whether or not for profit, as well as in their official
capacity with the Corporation. The Corporation also may pay for or reimburse the
reasonable attorney fees and expenses incurred by a director, officer, employee
or agent of the Corporation who is a party to a proceeding in advance of final
24
<PAGE>
disposition of the proceeding. The Corporation also may purchase and maintain
insurance on behalf of an individual arising from the individual's status as a
director, officer, employee or agent of the Corporation, whether or not the
Corporation would have power to indemnify the individual against the same
liability under the law. All references in these Articles of Incorporation are
deemed to include any amendment or successor thereto. Nothing contained in these
Articles of Incorporation shall limit or preclude the exercise of any right
relating to indemnification or advance of attorney fees and expenses to any
person who is or was a director, officer, employee or agent of the Corporation
or the ability of the Corporation otherwise to indemnify or advance expenses to
any such person by contract or in any other manner. If any word, clause or
sentence of the foregoing provisions regarding indemnification or advancement of
the attorney fees or expenses shall be held invalid as contrary to law or public
policy, it shall be severable and the provisions remaining shall not be
otherwise affected. All references in these Articles of Incorporation to
"director", "officer", "employee" and "agent" shall include the heirs, estates,
executors, administrators and personal representatives of such persons.
IN WITNESS WHEREOF, I have hereunto set my hand and seal, acknowledged
and filed the foregoing Articles of Incorporation under the laws of the State of
Florida, this _________________________.
___________________________
Elsie Sanchez, Incorporator
ACCEPTANCE OF REGISTERED AGENT DESIGNATED
IN ARTICLES OF INCORPORATION
-----------------------------------------
AmeriLawyer(R), having a business office identical with the registered
office of the Corporation name above, and having been designated as the
Registered Agent in the above and foregoing Articles of Incorporation, is
familiar with and accepts the obligations of the position of Registered Agent
under the applicable provisions of the Florida Statutes.
AmeriLawyer(R)
By: /s/ Natalia Utrera
------------------------------
Natalia Utrera, Vice President
25
<PAGE>
EXHIBIT 3.2
ARTICLES OF AMENDMENT
TO
ARTICLES OF INCORPORATION
OF
BAXTER CAPITAL COMPANY
Pursuant to the provisions of section 607.1006, Florida Statutes, this
corporation adopts the following Articles of Amendments to its Articles of
Incorporation:
FIRST: The officers of this corporation shall be:
PRESIDENT: KENNETH GREENBERG
Secretary: Peter Goldstein
Treasurer: Peter Goldstein
whose addresses shall be the same as the principal address of
the Corporation.
SECOND: The Director(s) of the Corporation shall be changed to:
Kenneth Greenberg
Peter Goldstein
whose addresses shall be the same as the principal address of the
Corporation.
THIRD: The date of the adoption of this amendment is the 13 August 1999.
FOURTH: The amendment was adopted by the Board of Directors.
No Shareholder action was required for adoption.
26
<PAGE>
FIFTH: This amendment shall be effective upon the filing with the
Secretary of State of Florida.
Signed this 13 August 1999.
/s/ Kenneth Greenberg
----------------------------------------
Kenneth Greenberg, Chairman of the Board
of Directors
27
<PAGE>
EXHIBIT 3.3
AMENDED AND RESTATED
BYLAWS
OF
BAXTER CAPITAL COMPANY
ARTICLE I
BUSINESS OFFICES
Baxter Capital Co. (the "Corporation") shall have such offices as its
business may require within or without the State of Florida.
ARTICLE II
REGISTERED OFFICES AND REGISTERED AGENT
2.1. Florida
-------
The address of the initial registered office in the State of
Florida and the name of the initial registered agent of the Corporation at such
address are set forth in the Articles of Incorporation. The Corporation may,
from time to time, designate a different address as its registered office or a
different person as its registered agent, or both; provided, however, that such
designation shall become effective upon the filing of a statement of such change
with the Department of State of the State of Florida as required by law.
2.2. Other States
------------
In the event the Corporation desires to qualify to do business
in one or more states other than Florida, the Corporation shall designate the
location of the registered office or location of the registered or resident
agent in each such state and designate the registered or resident agent for
service of process at such address in the manner provided by the law of the
state in which the Corporation elects to be qualified.
ARTICLE III
SHAREHOLDERS MEETINGS
3.1. Place of Meetings
-----------------
Meetings of the shareholders shall be held at the principal
office of the Corporation unless another place (within or without the State of
Florida) is designated in the notice of the meeting.
3.2. Annual Meeting
--------------
An annual meeting of the shareholders shall be held on the
last Monday of each June, or on such other day as the board of directors may
from time to time determine, at a time and place designated by the board of
directors, for the election of directors and for the transaction of other
business.
28
<PAGE>
3.3. Special Meetings
----------------
Special meetings of the shareholders shall be convened if
called by the president or the board of directors, or if requested in writing by
the holders of not less than one-tenth (1/10) of all the shares entitled to vote
at the meeting. The call for the meeting shall be issued by the secretary,
unless the president, board of directors or shareholders requesting the meeting
shall designate another person to do so.
3.4. Notice
------
Written notice stating the place, day, and hour of the meeting
and, in the case of a special meeting, the purpose or purposes for which the
meeting is called, shall be delivered to each shareholder of record entitled to
vote at such meeting not less than ten (10) nor more than sixty (60) days before
the date named for the meeting, either personally or by first-class United
States mail, by or at the direction of the president, the secretary, or the
officer or persons calling the meeting, unless other notice provisions are
required by law in a particular case. If mailed, such notice shall be deemed to
be delivered when deposited in the United States mail addressed to the
shareholder at that shareholder's address as it appears on the stock transfer
books of the Corporation, with postage thereon prepaid.
3.5. Notice of Adjourned Meetings
----------------------------
When a meeting is adjourned to another time or place, it shall
not be necessary to give any notice of the adjourned meeting if the time and
place to which the meeting is adjourned are announced at the meeting at which
the adjournment is taken, and any business may be transacted at the adjourned
meeting that might have been transacted on the original date of the meeting. If,
however, after the adjournment the board of directors fixes a new record date
for the adjourned meeting, a notice of the adjourned meeting shall be given as
provided in paragraph 3.4 above, to each shareholder of record on the new record
date who is entitled to vote at such meeting.
3.6. Waiver of Notice
----------------
Whenever notice is required to be given to any shareholder, a
waiver thereof in writing, signed by the person or persons entitled to such
notice, whether signed before, during, or after the time stated in the waiver,
shall be the equivalent of the giving of such notice. Attendance of a person at
a meeting shall constitute a waiver of notice of such meeting, except when the
person attends a meeting for the express purpose of objecting, at the beginning
of the meeting, to the transaction of any business because the meeting is not
lawfully called or convened. Neither the business to be transacted at, nor the
purpose of, any regular or special meeting of the shareholders need be specified
in the written waiver of notice.
3.7. Closing of Transfer Books and Fixing Record Date
------------------------------------------------
The board of directors may close the stock transfer books of
the Corporation or otherwise make a determination of shareholders for any
purpose, in accordance with the provisions of Section 607.0707 of the Florida
Statutes.
3.8. Record of Shareholders Having Voting Rights
-------------------------------------------
If the Corporation shall have more than five (5) shareholders,
the officer or agent having charge of the stock transfer books for shares of the
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Corporation shall make, at least ten (10) days before each meeting of
shareholders, a complete list of the shareholders entitled to vote at such
meeting or any adjournment thereof, with the address of, and the number and
class and series, if any, of shares held by, each. The list, for a period of ten
(10) days prior to such meeting, shall be kept on file at the registered office
of the Corporation, at the principal place of business of the Corporation, or at
the office of the transfer agent or registrar of the Corporation; and any
shareholder shall be entitled to inspect the list at any time during usual
business hours. The list shall also be produced and kept open at the time and
place of the meeting and shall be subject to the inspection of any shareholder
at any time during the meeting. If the requirements of this section have not
been substantially complied with, then on demand of any shareholder in person or
by proxy, the meeting shall be adjourned until there has been compliance with
the requirements. If no such demand is made, failure to comply with the
requirements of this section shall not affect the validity of any action taken
at such meeting.
3.9. Shareholder Quorum
-------------------
The holders of a majority of the shares entitled to vote,
represented in person or by proxy, shall constitute a quorum at a meeting of
shareholders. When a specified item of business is required to be voted on by a
class or series of stock, the holders of a majority of the shares of such class
or series shall constitute a quorum for the transaction of such item of business
by that class or series. If a quorum is present at a properly held meeting of
the shareholders, the affirmative vote of the holders of a majority of the
shares represented in person or by proxy and entitled to vote on the subject
matter under consideration, shall be the act of the shareholders, unless the
vote of a greater number or voting by classes (i) is required by the Articles of
Incorporation, or (ii) has been provided for in an agreement among all
shareholders entered into pursuant to and enforceable under Chapter 607 of the
Florida Statutes. After a quorum has been established at a shareholders meeting,
the subsequent withdrawal of shareholders or their proxies, reducing the number
of shares represented and entitled to vote at the meeting below the number
required for a quorum, shall not affect the validity of any action taken at the
meeting or any adjournment thereof.
3.10. Proxies
-------
Every shareholder entitled to vote at a meeting of
shareholders or to express consent or dissent without a meeting, or a
shareholder's duly authorized attorney-in-fact, may authorize another person or
persons to act for that shareholder by proxy in accordance with the provisions
of Section 607.0722 of the Florida Statutes.
3.11. Action by Shareholders Without a Meeting
----------------------------------------
Shareholder action may be taken by written consent in lieu
of a meeting in accordance with the provisions of Section 607.0704 of the
Florida Statutes.
ARTICLE IV
DIRECTORS
4.1. Function
--------
Except as otherwise provided in Chapter 607 of the Florida
Statutes or in the Articles of Incorporation, all corporate powers shall be
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exercised by or under the authority of, and the business and affairs of the
Corporation shall be managed under the direction of, the board of directors.
4.2. Qualification
-------------
Directors need not be residents of Florida or shareholders of
the Corporation; however, each director shall meet such qualifications as may be
set forth in the Articles of Incorporation and in the laws of the State of
Florida.
4.3. Compensation
------------
The board of directors shall have authority to fix the
compensation of directors. Nothing herein contained shall be construed to
preclude any director from serving the Corporation in any other capacity and
receiving compensation therefor.
4.4. Number
------
The number of directors shall be two (2), such number may be
increased or decreased from time to time by amendment to these Bylaws or the
articles of incorporation or by the board of directors or the shareholders of
the Corporation.
4.5. Election and Term
-----------------
4.5.1. Each person named in the Articles of Incorporation as a
member of the initial board of directors shall hold office until the first
annual meeting of shareholders and until his successor shall have been elected
and qualified or until his earlier resignation, removal from office, or death.
4.5.2. At the first annual meeting of shareholders and at each
annual meeting thereafter, the shareholders shall elect directors to hold office
until the next succeeding annual meeting. Each director shall hold office for
the term for which he is elected and until his successor shall have been elected
and qualified, or until his earlier resignation, removal from office, or death.
4.6. Removal of Directors
--------------------
Any director, or the entire board of directors, may be
removed, with or without cause, at a meeting of the shareholders called
expressly for that purpose, in accordance with the provisions of Section
607.0808 of the Florida Statutes.
4.7. Vacancies
---------
Any vacancy occurring in the board of directors, including any
vacancy created by reason of an increase in the number of directors, may be
filled by the affirmative vote of a majority of the remaining directors, though
less than a quorum of the board of directors.
4.8. Quorum and Voting
-----------------
A majority of the number of directors fixed in accordance with
these Bylaws shall constitute a quorum for the transaction of business. Subject
to other provisions of these Bylaws, the act of the majority of the directors
present at a meeting at which a quorum is present shall be the act of the board
of directors. If at any meeting of the board of directors there shall be less
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than a quorum present, a majority of those present may adjourn the meeting from
time to time until a quorum is obtained. Notice of any such adjourned meeting
shall be given to the directors who were not present at the time of the
adjournment and, unless the time and place of the adjourned meeting were
announced at the time of the adjournment, to the other directors.
4.9. Executive and Other Committees
------------------------------
4.9.1. The board of directors, by resolution adopted by a
majority of the full board of directors, may designate from among its members an
Executive Committee and one or more other committees, each of which, to the
extent provided in such resolution, shall have and may exercise all the
authority of the board of directors, as limited by Section 607.0825 of the
Florida Statutes.
4.9.2. The board of directors, by resolution adopted in
accordance with paragraph 4.9.1 above, may designate one or more directors as
alternate members of any such committee, who may act in the place and stead of
any absent member or members at any meeting of such committee.
4.10. Place of Meetings
-----------------
Regular or special meetings of the board of directors may be
held within or without the State of Florida.
4.11. Time, Notice and Call of Meetings
---------------------------------
4.11.1. Regular meetings of the board of directors shall be
held immediately following the annual meeting of shareholders each year; regular
meetings may be held at such other times as the board of directors may fix;
special meetings may be held at such times as called by the chairman of the
board, the president of the Corporation or any two directors. Written notice of
the time and place of special meetings of the board of directors shall be given
to each director by personal delivery or by first-class United States mail,
telegram, or cablegram at least two (2) days before the meeting.
4.11.2. Notice of a meeting of the board of directors need not
be given to any director who signs a waiver of notice either before, during or
after the meeting. Attendance of a director at a meeting shall constitute a
waiver of notice of such meeting and a waiver of any and all objections to the
place of the meeting, the time of the meeting, or the manner in which it has
been called or convened, except when a director states, at the beginning of the
meeting, any objection to the transaction of business because the meeting is not
lawfully called or convened.
4.11.3. Members of the board of directors may participate in a
meeting of such board by conference telephone or similar communications
equipment by means of which all persons participating in the meeting can hear
each other at the same time. Participation by such means shall constitute
presence in person at a meeting.
4.12. Action Without a Meeting
------------------------
Any action which is required to be taken, or which may be
taken, at a meeting of the directors or a committee thereof, may be taken
without a meeting if a consent in writing, setting forth the action so to be
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taken, signed by all the directors, or all the members of the committee, as the
case may be, is filed in the minutes of the proceedings of the directors or of
the committee. Such consent shall have the same effect as a unanimous vote.
4.13. Director Conflicts of Interest
------------------------------
4.13.1. No contract or other transaction between the
Corporation and one or more of its directors or any other corporation, firm,
association, or entity in which one or more of its directors are directors or
officers or are financially interested, shall be either void or voidable because
of such relationship or interest, or because such director or directors are
present at the meeting of the board of directors or a committee thereof which
authorizes, approves, or ratifies such contract or transaction, or because his
or their votes are counted for such purpose, if:
(i) the fact of such relationship or interest is
disclose or known to the board of directors or committee which authorizes,
approves, or ratifies the contract or transaction by a vote or consent
sufficient for the purpose without counting the votes or consents of such
interested directors; or
(ii) the fact of such relationship or interest is
disclosed or known to the shareholders entitled to vote and they authorize,
approve, or ratify such contract or transaction by vote or written consent; or
(iii) the contract or transaction is fair and
reasonable as to the Corporation at the time it is authorized by the directors,
a committee, or the shareholders.
4.13.2. Common or interested directors may be counted in
determining the presence of a quorum at a meeting of the board of directors or a
committee thereof which authorizes, approves, or ratifies such contract or
transaction.
ARTICLE V
OFFICERS
5.1. Officers
--------
The board of directors shall determine from time to time the
offices of the Corporation, which may consist of chairman of the board,
president, any number of vice presidents, a secretary, assistant secretary
(ies), a treasurer, assistant treasurer(s), and such other offices as may be
determined from time to time by the board of directors. Any two or more offices
may be held by the same person. The officers shall be elected by the board
of directors and shall meet such qualifications as shall be determined by the
board of directors under the authority of the Articles of Incorporation and of
the laws of the State of Florida.
5.2. Duties
------
Except as may be modified from time to time by the board of
directors, the powers and duties of the officers shall be as follows:
5.2.1. The chairman of the board shall preside at all meetings
of shareholders and of the board of directors, and shall have the powers and
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perform the duties usually pertaining to such office, and shall have such other
powers and perform such other duties as may be from time to time prescribed by
the board of directors.
5.2.2. The president shall be the chief executive officer of
the Corporation, and shall have general and active management of the business
and affairs of the Corporation, under the direction of the board of directors.
Unless the board of directors has appointed another presiding officer, the
president shall preside at all meetings of the shareholders.
5.2.3. Vice presidents shall have such powers and perform such
duties as usually pertain to such office or as are properly required of him by
the board of directors. In the absence or disability of the president, the vice
president(s) (in order of their seniority) shall perform the duties and exercise
the powers of the president.
5.2.4. The secretary shall have custody of, and maintain, all
the corporate records except the financial records, and shall record the
minutes of all meetings of the shareholders and the board of directors and its
committees, send all notices of meetings, and perform such other duties as may
be prescribed by the board of directors or the president.
5.2.5. The treasurer shall have custody of all corporate funds
and financial records, shall keep full and accurate accounts of receipts and
disbursements and render accounts thereof at the annual meetings of shareholders
and whenever else required by the board of directors or the president, and shall
perform such other duties as may be prescribed by the board of directors or the
president.
5.2.6. The assistant secretary(ies), assistant treasurer(s),
and other assistant officers may exercise, subject to supervision by the officer
for whom they act as assistant(s), except as otherwise provided for by the board
of directors, the powers and duties that pertain to such offices respectively
and any such other powers and duties which may be delegated to them.
5.3. Term of Office
--------------
Unless otherwise provided at the time of his election, each
person named as an officer of the Corporation by the board of directors shall
hold office until the meeting of the board of directors following or concurrent
with the next succeeding annual meeting of the shareholders, and until his
successor shall have been elected and qualified; or until his earlier
resignation, removal from office, or death.
5.4. Removal of Officer
------------------
Any officer or agent elected or appointed by the board of
directors may be removed by the board of directors whenever, in its judgment,
the best interests of the Corporation will be served thereby.
5.5. Vacancies
---------
Any vacancy, however occurring, in any office may be filled by
the board of directors.
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ARTICLE VI
STOCK CERTIFICATES
6.1. Authorization
-------------
The Corporation may issue shares of stock authorized by and in
accordance with its Articles of Incorporation, as same may be amended from time
to time, and none other. Shares may be issued originally only pursuant to a
resolution adopted by the board of directors. No shares may be validly issued or
transferred in violation of any provision of these Bylaws or in violation of any
agreement, to which the Corporation is a party, respecting the issuance or
transfer of shares.
6.2. Issuance
--------
Every holder of shares in the Corporation shall be entitled to
have a certificate representing all shares to which that holder is entitled. No
certificate shall be issued for any share until such share is fully paid.
6.3. Signatures
----------
Certificates representing shares in the Corporation shall be
signed by the president or a vice president and the secretary or an assistant
secretary or by such other officers as may be designated from time to time by
the board of directors and may be sealed with the seal of the Corporation or a
facsimile thereof. The signatures of the president or vice president and the
secretary or an assistant secretary or other designated officer may be
facsimiles if the certificate is manually signed on behalf of a transfer agent
or a registrar other than the Corporation or an employee of the Corporation.
6.4. Form
----
Each certificate representing shares shall state upon the face
thereof: the name of the Corporation; that the Corporation is organized under
the laws of Florida; the name of the person or persons to whom issued; the
number and class of shares and the designation of the series, if any, which such
certificate represents; and the par value of each share represented by such
certificate or a statement that the shares are without par value.
6.5. Transfer of Stock
-----------------
The Corporation shall cancel stock certificates presented to
it for transfer and issue and register a new certificate or certificates in the
name of a qualified transferee of such shares, if the certificate is properly
endorsed by the holder of record or by his duly authorized attorney; provided,
however, that the Corporation or its transfer agent may establish other
reasonable requirements for transfer, including but not limited to the guarantee
of the transferor's signature by a commercial bank or trust company or by a
member of the New York Stock Exchange or of the American Stock Exchange.
6.6. Lost, Stolen, or Destroyed Certificates
---------------------------------------
The Corporation shall issue a new stock certificate
duplicating any certificate previously issued, if the holder of record of the
certificate: (i) submits proof in affidavit form that it has been lost,
destroyed, or wrongfully taken; (ii) requests the issuance of a new certificate,
before the Corporation has notice that the certificate has been acquired by a
35
<PAGE>
purchaser for value in good faith and without notice of any adverse claim; (iii)
gives bond, in such form as the Corporation may direct, to indemnify the
Corporation, the transfer agent, and the registrar against any claim that may be
made on account of the alleged loss, destruction, or theft of such certificate;
and (iv) satisfies any other reasonable requirements imposed by the Corporation.
ARTICLE VII
BOOKS AND RECORDS
7.1. Books and Records
-----------------
7.1.1. The Corporation shall keep correct and complete books
and records of account and shall keep minutes of the proceedings of its
shareholders, board of directors, and committees of directors.
7.1.2. The Corporation shall keep, at its registered office or
principal place of business or at the office of its transfer agent or registrar,
a record of its shareholders, giving the names and addresses of all
shareholders, and the number, class, and series, if any, of the shares held by
each.
7.1.3. Any books, records, and minutes may be in written form
or in any other form capable of being converted into written form within a
reasonable time.
7.2. Shareholders' Inspection Rights
-------------------------------
Shareholders of record shall have the right to examine and
make extracts from the books and records of the Corporation to the extent
provided in Section 607.1603 of the Florida Statutes.
7.3. Financial Information
---------------------
7.3.1. Unless modified by resolution of the shareholders not
later than four (4) months after the close of each fiscal year, the Corporation
shall prepare a balance sheet showing in reasonable detail the financial
condition of the Corporation as of the close of its fiscal year, and a profit
and loss statement showing the results of the operations of the Corporation
during its fiscal year.
7.3.2. Upon the written request of any shareholder or holder
of voting trust certificates for shares of the Corporation, the Corporation
shall mail to such shareholder or holder of voting trust certificates a copy of
the most recent balance sheet and profit and loss statement.
7.3.3. The balance sheets and profit and loss statements shall
be filed in the registered office of the Corporation in Florida, shall be kept
for at least five (5) years, and shall be subject to inspection during business
hours by any shareholder or holder of voting trust certificates, in person or by
agent.
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ARTICLE VIII
INDEMNIFICATION
Each person (including here and hereinafter, the heirs, executors,
administrators, or estate of such person): (i) who is or was a director or
officer of the Corporation; (ii) who is or was an agent or employee of the
Corporation other than an officer and as to whom the Corporation has agreed to
grant such indemnity; or (iii) who is or was serving at the request of the
Corporation as its representative in the position of a director, officer, agent
or employee of another corporation, partnership, joint venture, trust or other
enterprise and as to whom the Corporation has agreed to grant such indemnity;
shall be indemnified by the Corporation as of right to the fullest extent
permitted or authorized by current or future legislation or by current or future
judicial or administrative decision, against any fine, liability, cost or
expense, including attorneys' fees, asserted against him or incurred by him in
his capacity as such director, officer, agent, employee, or representative, or
arising out of his status as such director, officer, agent, employee or
representative. The foregoing right of indemnification shall not be exclusive of
other rights to which those seeking an indemnification may be entitled. The
Corporation may maintain insurance, at its expense, to protect itself and any
such person against any such fine, liability, cost or expense, whether or not
the Corporation would have the legal power to directly indemnify him against
such liability.
ARTICLE IX
APPLICABLE LAW
These Bylaws shall be construed and enforced in accordance with the
laws of the State of Florida. All references in these Bylaws to Chapter 607 of
the Florida Statutes and to sections thereof shall refer to such sections as
same may be amended from time to time; however, in the event any amendment
thereto is not required to be retroactively applied to the Corporation, the
board of directors may elect to continue to comply with the provisions
theretofore in effect or to comply with the provisions as amended.
In the event all the shareholders enter into an agreement under the
provisions of Section 607.0732 of the Florida Statutes, any provisions of that
agreement, which by the terms of the agreement are intended to supersede
provisions of these Bylaws that are inconsistent therewith, as well as
provisions of the Articles of Incorporation, shall govern and shall supersede
these Bylaws.
ARTICLE X
AMENDMENT
These Bylaws may be repealed or amended, and new Bylaws may be adopted,
by either the board of directors or the shareholders, but the board of directors
may not amend or repeal any Bylaw adopted by shareholders if the shareholders
specifically provide that such Bylaw is not subject to amendment or repeal by
the directors.
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EXHIBIT 4.1
NUMBER SHARES
Incorporated under the laws of the State of Florida
BAXTER CAPITAL COMPANY
Total Authorized Issue
1,000,000 Shares $.001 Par Value See Reverse for
Common Stock Certain Definitions
This is to certify that _________________________________________is the owner of
_________________________________________________ fully paid and non-assessable
shares of the above Corporation transferable only on the books of the
Corporation by the holder thereof in person or by a duly authorized Attorney
upon surrender of this Certificate properly endorsed.
Witness, the seal of the Corporation and the signatures of its duly authorized
officers.
Dated
- - - -------------------------- ----------------------------
Peter Goldstein, Secretary Kenneth Greenberg, President
38
<PAGE>
The following abbreviations, when used in the inscription on the face
of this certificate, shall be construed as though they were written in full
according to applicable laws or regulations:
TEN COM --as tenants in common UNIF GIFT MIN ACT Custodian
(Cust) (Minor)
TEN ENT --as tenants by the under Uniform Gifts to Minors Act
entireties
JT TEN --as joint tenants with right of (State)
survivorship and not as tenants
in common
Additional abbreviation may also be used though not in the list
above
For value received ________ hereby sell, assign and transfer unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
- - - ---------------------------------------------
- - - ---------------------------------------------
- - - --------------------------------------------------------------------------------
(PLEASE PRINT OR TYPE NAME AND ADDRESS INCLUDING POSTAL ZIP OF ASSIGNEE)
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________ Shares
represented by the within Certificate and do hereby irrevocably constitute and
appoint________________________________________________________________ Attorney
To transfer the said Shares on the books of the writing named Corporation with
the full power of Substitution in the premises.
Dated: ________________________________
In presence of ________________________________________________________
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE OR
OTHER JURISDICTION, AND MAY NOT BE SOLD, TRANSFERRED, PLEDGED, HYPOTHECATED OR
OTHERWISE DISPOSED OF IN THE ABSENCE OF (1) AN EFFECTIVE REGISTRATION STATEMENT
FOR SUCH SECURITIES UNDER APPLICABLE LAW, OR (2) AN OPINION OF COMPANY COUNSEL,
SATISFACTORY TO THE CORPORATION, THAT SUCH REGISTRATION IS NOT REQUIRED.
39
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EXHIBIT 10.1
INDEMNIFICATION AGREEMENT
AND
COVENANT NOT TO SUE
AGREEMENT, made and entered into as of 27 June 1998, between Baxter Capital
Co., a Florida corporation (the "Corporation"), and Elsie Sanchez, (collectively
herein, "Indemnitee").
W I T N E S S E T H
WHEREAS, at the request of the Corporation, Indemnitee currently serves as
Officer and/or Director of the Corporation and may, therefore, be subjected to
actions, suits or proceedings by reason of such service; and
WHEREAS, as an inducement to Indemnitee to continue to serve as Officer and
Director, the Corporation has agreed not to sue and to indemnify Indemnitee
against expenses and costs incurred by Indemnitee in connection with any such
actions, suits or proceedings, to the fullest extent permitted by law; and
WHEREAS, the parties desire to set forth their agreement regarding
indemnification;
NOW, THEREFORE, for and in consideration of the mutual promises contained
herein, and other good and valuable consideration, the parties agree as follows:
1. Acts or Omissions Covered By This Agreement.
-------------------------------------------
This Agreement shall cover any act or omission by Indemnitee which:
1.1 occurs or is alleged to have occurred by reason of its being or
having been the Officer and/or Director of the Corporation;
1.2 occurs or is alleged to have occurred before, during or after the
time when the Indemnitee served as Officer and/or Director of the Corporation;
and
1.3 gives rise to, or is the direct or indirect subject of a claim in
any threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative, at any time or times whether during
or after Indemnitee serves as Officer and/or Director of the Corporation.
40
<PAGE>
2. Indemnity and Covenant Not to Sue.
--------------------------------
Subject to the provisions of Florida Statute Section 607.0850:
2.1 The Corporation shall indemnify, to the fullest extent permitted
by the Corporation's articles of incorporation and by laws, and regardless of
any bylaw provision to the contrary, Indemnitee, from and against any expenses
(including attorneys' fees), judgments, fines, taxes, penalties and amounts
paid in settlement actually and reasonably incurred by Indemnitee in connection
with any threatened, pending or completed action, suit or proceeding, whether
civil, criminal, administrative or investigative, by reason of the fact that
Indemnitee is or was Officer and/or director of the Corporation or was serving
at the request of the Corporation as the Officer and/or Director of
another corporation, partnership, joint venture, trust or other enterprise and
whether or not such actions are by or in the right of the Corporation or such
other corporation, partnership, joint venture, trust or other enterprise with
respect to which the Indemnitee serves or has served.
2.2 The Corporation agrees that it will never institute any action or
suit at law or in equity against Indemnitee, nor institute, prosecute, or in any
way aid in the institution or prosecution of any claim, demand, action, or cause
of action for damages, costs, loss of services, expenses, or compensation for or
on account of any damage, loss or injury either to person or property, or both,
whether developed or undeveloped, resulting or to result, known or unknown,
past, present, or future, arising out of Indemnitee' services to the
Corporation.
3. Successful Defense; Burden of Proof; Settlement; No Presumption.
-------------------------------------------------------------------
Notwithstanding any other provision of this Agreement, to the extent that
Indemnitee has been successful or unsuccessful on the merits in defense of any
action, suit or proceeding or in defense of any issue or matter therein,
including, without limitation, dismissal without prejudice, Indemnitee shall be
indemnified against any and all expenses (including attorney fees), judgments,
fines, taxes, penalties and amounts paid in settlement with respect to such
action, suit or proceeding.
3.1 Indemnitee shall be presumed to be entitled to indemnification for
any act or omission covered under this Agreement. The burden of proof of
establishing that Indemnitee is not entitled to indemnification because of the
failure to fulfill some requirement of Federal or Florida law, the Corporation's
articles of incorporation or by-laws or this Agreement shall be on the
Corporation.
3.2 The Corporation shall not settle any action or claim in any manner
which would impose any penalty or limitation on Indemnitee without Indemnitee's
prior written consent. Indemnitee shall not unreasonably withhold his consent to
any proposed settlement.
3.3 For purposes of this Agreement, the termination of any action,
suit or proceeding, by judgment, order, settlement (whether with or without
court approval) or conviction, or upon a plea of nolo contendere, or its
equivalent, shall not create a presumption that Indemnitee did not meet any
41
<PAGE>
particular standard of conduct or have any particular belief or that a court has
determined that indemnification is not permitted by applicable law or this
Agreement.
4. Notice By Indemnitee. Indemnitee shall notify the Corporation in writing of
any matter with respect to which Indemnitee intends to seek indemnification
hereunder as soon as reasonably practicable following the receipt by Indemnitee
of written threat thereof; provided, however, that failure to so notify the
Corporation shall not constitute a waiver by Indemnitee of his rights hereunder.
5. Advancement of Expenses. In the event of any action, suit or proceeding
against Indemnitee which may give rise to a right of indemnification from the
Corporation pursuant to this Agreement, following written request to the
Corporation by Indemnitee, the Corporation shall advance to Indemnitee amounts
to cover expenses (including attorney fees) incurred by Indemnitee in defending
any such action, suit or proceeding in advance of the final disposition thereof
upon receipt of reasonably satisfactory evidence as to the amount of such
expenses. Indemnitee's written certification together with a copy of any expense
statement paid or to be paid by Indemnitee shall constitute satisfactory
evidence as to the amount of expenses.
6. Non-Exclusivity of Right of Indemnification. The indemnification rights
granted to Indemnitee under this Agreement shall not be deemed exclusive of, or
in limitation of, any other rights to which Indemnitee may be entitled under
Florida or Federal law, the Corporation's articles of incorporation or by-laws,
any other agreement, any vote of Shareholders or Directors or otherwise. To the
extent Florida or Federal law, the Corporation's articles of incorporation or
by-laws or other applicable law, as in effect on the date hereof or at any time
in the future, permit greater indemnification than is provided for in this
Agreement, Indemnitee shall enjoy such greater benefits so afforded, and this
agreement shall be deemed amended without any further action by the Corporation
or Indemnitee to grant such greater benefits. Indemnitee shall be entitled, in
the sole discretion of Indemnitee, to elect to have Indemnitee's rights
hereunder interpreted on the basis of applicable law in effect at the time of
execution of this Agreement, at the time of the occurrence of the indemnifiable
event giving rise to a claim or at the time indemnification is sought. 7.
Termination of Agreement and Survival of Right of Indemnification. Subject to
Section 7.1, this Agreement shall terminate when Indemnitee' services to the
Corporation as Officer and/or Director end.
7.1 The rights granted to Indemnitee hereunder shall continue after
termination and shall inure to the benefit of Indemnitee, his heirs, personal
representatives and assigns, and this Agreement shall be binding upon the
Corporation and its successors and assigns.
42
<PAGE>
8. Mediation and Arbitration.
--------------------------
Any disputes between the parties hereto, whether arising under this agreement or
otherwise, which the parties cannot resolve between themselves using good faith
shall be:
8.1 Referred to a court certified mediator of the Circuit Court in the
County of the principal office of the Corporation, and any mediation shall be
held in the County of the principal office of the Corporation. The parties shall
share equally in the cost of said mediation.
8.2 In the event that said dispute is not resolved in mediation, the
parties shall submit the dispute to a neutral arbitrator residing in the County
of the principal address of the Corporation. The arbitration shall be held in
the County of the principal office of the Corporation. The parties shall share
equally in the cost of said arbitration. In the event that the parties are
unable to agree upon an arbitrator within 15 days of the date on which either
party requests arbitration of a matter, the arbitrator shall be provided by the
American Arbitration Association. The parties further agree that full discovery
shall be allowed to each party to the arbitration and a written award shall be
entered forthwith. Any and all types of relief that would otherwise be available
in Court shall be available to both parties in the arbitration. The decision of
the arbitrator shall be final and binding. Arbitration shall be the exclusive
legal remedy of the parties. judgment upon the award may be entered in any court
of competent jurisdiction pursuant to Florida Statutes Chapter 682, as amended,
The Arbitration Code.
8.3 If either party refuses to comply with a ruling or decision of the
arbitrator and a lawsuit is brought to enforce said ruling or decision, it is
agreed that the party not complying with the ruling or decision of the
arbitrator shall pay the court costs and reasonable attorney's fees (including
Trial and Appellate attorney's fees) incurred in enforcing the ruling or
decision of the arbitrator.
8.4 Any rights of injunctive relief shall be in addition to and not in
derogation or limitation of any other legal rights.
9. Interpretation of Agreement.
---------------------------
The parties acknowledge that this Agreement is the product of mutual efforts by
the parties and their respective agents. This Agreement shall be interpreted
neither more favorable in favor of one party, nor less favorably in favor of
another party.
10. Entire Agreement.
----------------
This Agreement constitutes the entire understanding of the parties and
supersedes all prior discussions, negotiations, and understandings, whether oral
or written, with respect to its subject matter.
11. Modification.
------------
No change or modification of this Agreement shall be valid unless it is in
writing and signed by all the parties who are bound by the terms of this
Agreement.
43
<PAGE>
12. Attorney's fees; Costs.
-------------------------
In any mediation, arbitration or litigation arising out of this Agreement, the
prevailing party in such litigation shall be entitled to recover reasonable
attorney's fees and costs at both the trial and appellate levels.
13. Severability.
------------
If any provision of this Agreement is held invalid, unenforceable, or void by a
court of competent jurisdiction, this Agreement shall be considered divisible as
to such provision, and the remainder of the Agreement shall be valid and binding
as though such provision were not included in this Agreement.
14. Authorization.
--------------
The Corporation is authorized to enter into this Agreement by virtue of a
resolution adopted as a meeting of Directors held the 27 June 1998.
15. Benefits; Binding Effects.
---------------------------
This Agreement shall be binding upon and shall operate for the benefit of the
parties hereto and their respective heirs, personal representative,
administrators, successors, and assigns.
16. Venue and Jurisdiction.
-----------------------
Should a lawsuit be necessary to enforce this Agreement the parties agree that
jurisdiction and venue are waived and suit shall be brought in the county of the
principal office of the Corporation.
17. Notices.
-------
All notices, offers, acceptances and other communications provided for in this
Agreement shall be deemed delivered if sent in writing and delivered either
personally or by certified mail to the Corporation at its principal office, or
to the Indemnitee address appearing on the records of the Corporation, or to
such other address as may be designated in writing by the Corporation or the
Indemnitee.
18. No-Waivers.
----------
The waiver by any party of any other party's breach of any provision of this
Agreement shall not operate nor be construed as a waiver of any subsequent
breach, and the waiver by any party to exercise any right or remedy shall not
operate nor be construed as a waiver or bar to the exercise of such right or
remedy upon the occurrence of any subsequent breach.
19. Headings.
--------
Headings in this Agreement are for convenience only and shall not be used to
interpret or construe its provisions.
20. Governing Law.
---------------
This Agreement shall be governed by the laws of the State of Florida (without
regard to the laws that might be applicable under principles of conflicts of
law) as to all matters, including, but not limited to, matters of validity,
construction, effect and performance.
21. Counterparts.
------------
This Agreement may be executed in two or more parts, each of which shall be
deemed an original but all of which together shall be one and the same
instrument.
22. Facsimile Copy.
--------------
A facsimile copy of this Agreement and any signatures affixed hereto shall be
considered for all purposes as originals.
44
<PAGE>
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the day and year first above stated.
/s/ Elsie Sanchez
-------------------------
Elsie Sanchez, Indemnitee
BAXTER CAPITAL COMPANY
By: /s/ Elsie Sanchez
-------------------------
Elsie Sanchez, Director
45
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