SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10
GENERAL FORM FOR REGISTRATION OF SECURITIES
Pursuant to Section 12(b) or (g) of the Securities Exchange Act of 1934
PEP Management Corporation
(Exact name of registrant as specified in its charter)
Florida 59-3461075
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1432 Court Street. Clearwater, FL 33756
(Address of principal executive offices) (Zip Code)
(727) 449-2243
Registrant's telephone number, including area code
Securities to be registered pursuant to Section 12(b) of the Act:
None.
Securities to be registered pursuant to Section 12(g) of the Act:
Common Shares, $0.001 par value per share
(Title of class)
Documents incorporated by reference: None.
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Part I
Item 1. Business.
History
The company was incorporated under the laws of the State of Florida on
January 2, 1991. On February 27, 1997, the Company changed its name from
Centurion Insurance Services, Inc. to PEP Equities Corporation and after
certain restructuring to PEP Management Corporation (the "Company").
The Company's principal executive office is currently located at and its
telephone number is 1432 Court Street, Clearwater, Florida 33756-6147, (727)
449-2243.
Activities
At the present time, the Company' business plan calls for it to develop and
operate companies in the alternative energy business and related which have
socially responsible products and services.
The Company originally acquired interests in companies assisted by its
President. As of February 29, 2000, the Company had interests in seven
companies. As of February 29, 2000 the Company has classified its interests in
its companies as either continuing or non-continuing companies. The Company
intends to use its best efforts to dispose of its interests in non-continuing
companies in an orderly manner. The Company will continue to assist those
companies classified as continuing companies.
General
The Company's goal is to acquire control of and operate companies which have
socially responsible products and services.
Operation of Business
The Company intends that the Company will operate in the future by engaging
in business through wholly-owned, majority-owned or controlled companies, where
the Company's officers and directors participate in the management of the
controlled comapny.
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SUMMARY OF PEP'S COMPANIES
Continuing Companies
H2O 2000, Inc.
H2O 2000, Inc. (H2O 2000) is a development stage company that has the rights to
a unique gas generating device used in welding, cutting and brazing. H2O 2000's
technology is patent pending.
H2O 2000, Inc. has patented a revolutionary new welding and metal cutting
device, powered by water and electricity only. Water is converted into a stable
hydrogen hybrid fuel, which performs the cutting and welding applications. H2)
2000's management believes their technology is cutting edge, and will
substantially change this market, providing substantial cost savings, and
increasing safety of welding and metal cutting operations of all kinds.
The gas generating device electorlyzes water using low amperage AC or DC
current. The water is changed on demand into a perfect Stochiometric mix of two
parts hydrogen and one part oxygen. This gas has the following unique
properties: (1) low fuel cost because water is used, (2) environmentally
friendly, (3) the temperature of the flame varies according to the melting point
of the material contacted by the flame and can go up to 6,000 degrees
Fahrenheit, hot enough to melt tungsten. At the present time, H2O 2000 has
demonstrated and tested the effectiveness of its technology and is starting to
market a mobile welding unit.
The welder is clean, safe, very efficient, and capable of operating for 24 hours
on just a liter of water. H2O 2000's welder is expected to soon complete
`independent safety certification'. This certification is not required for
commercial sales, but demonstrates the commitment by the parent company to allay
fears about hydrogen based technology devices. H2O 2000, Inc. anticipate first
orders will be shipped from full scale manufacturing in June. While final retail
prices are not yet fixed, devices are expected to retail for about $5,000 each.
The H2O 2000 welder could provide cost savings of up to 60% over conventional
welding methods and devices.
The Company owns 800,000 shares of H20 2000, or approximately 4% of H20
2000.
Dyna-Spark Technologies, Inc.
Dyna-Spark Technologies, Inc. (Dyna-Spark) is a development stage company that
has a patented new automotive spark plug technology. Dyna-Spark was issued a
research grant by the U. S. Department of Energy to conduct clean air testing
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and emissions control research. Research has shown that Dyna-Spark's SmartPlug
improves fuel efficiency 11-15% and reduces emissions by 75% in test vehicles.
The product is in the prototype stage and is undergoing testing.
The Company 100,000 shares of the common stock of Dyna-Spak representing 10% of
Dyna-Spark. Dyna-Spark, in turn has a 12.5% equity interest in Smart Plug, Inc.,
the joint venture developing the SmartPlug.
Non-Continuing Companies
International HealthCare Distributors, Inc.
Go!( is a nutritional supplement invented by Dr. Cade, the inventor of
GATORADE(. International HealthCare Distributors, Inc. (IHCD) was formed to
market, manufacture, and distribute Go!. At the present time, Systems Go
International, LLC of Tampa,Florida is manufacturing and marketing Go!.
The Company owns 300,000 shares of the common stock of International Healthcare
30.0%.
M International Corporation
M International Corporation ("MIC"), is a partially-owned subsidiary of
International HealthCare Distributors, Inc. MIC was formed to launch a marketing
effort for a cholesterol reducing product called CHOLESTERADE, invented by Dr.
Cade, inventor of GATORADE. CHOLESTERADE has been clinically proven to lower
the cholesterol levels of users a minimum of seventeen (17) percent, in as
little as ten (10) days. CHOLESTERADE was originally available only in Orange
flavor. The product is now also available in Grape, Lemon-Lime, and
Kiwi-Tangerine. At the present time, Systems Go International, LLC of
Tampa,Florida is manufacturing and marketing CHOLESTERAGE. The product is being
distributed by physicians in North Florida through their medical practices, and
through a group of independent distributors.
The Company owns 86,000 representing 34.4% of M International.
Kalamed Corporation
Kalamed Corporation (Kalamed) was formed for the purpose of developing and
marketing medical devices. Kalamed is currently developing a device for the in
situ, non-invasive, real-time detection of cancer. This device, the Biomedical
Spectral Analyzer, is currently in clinical trials to test its efficacy in
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detecting cancers in the bladder and colon. Another device, the MediMend, is a
bone growth stimulator for the non-invasive repair of broken bones which is
inexpensive, reusable and tiny. The MediMend is currently being launched into
the veterinary market and will enter human clinical trials.
The Company owns 10,000 shares of Kalamed common stock, representing 0.0064 % of
Kalamed.
Silver-Star International
Silver Star International, Inc. is the exclusive marketing agent/ distributor to
the U.S. Defense sector, including all military branches of service and to
defense contractors for H2O 2000. Additional information about the device and
technology can be found at www.H2O2000.org . Silver Star International, Inc. is
an integrated marketing company.
The Company has 20,000 shares of Silver Star common stock These securities are
unregistered and restricted. As of the date of this filing, Silver Star common
stock had a market value of $0.15625 The symbol for Silver Star is SVSRE.OB.
Equitech International Corporation "EQTL" NASDAQ BB
Equitech International Corporation ("Equitech") is a publicly traded company
located in Aiken, South Carolina. Equitech was formed to take advantage of
certain technologies and scientific resources available from the U.S. Department
of Energy's Westinghouse Savannah River Site National Laboratory in the fields
of fiber optics, electro current and biotechnology. Equitech's stock symbol is
"EQTL". As of March 31, 2000 the Company owned 4,830 shares of the restricted
common stock of Equitech. Equitech is a non-reporting company listed in the
"pink sheets." As of the March 31, 2000, Equitech had a price of $1.00 per
share.
Governmental Regulation The conduct of the Company's businesses subject it
to environmental, public health and safety, land use, trade, or other
governmental regulations and state or local taxation. In certain circumstances,
however, it may not be possible to predict with any degree of accuracy the
impact of government regulation. The inability to ascertain the effect of
government regulation on a business activity will make the development and
operation such a business a higher risk.
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Competition
The Company is involved in intense competition with other business
entities, many of which have a competitive edge over the Company by virtue of
their stronger financial resources and prior experience in business. There is
no assurance that the Company will be successful in developing and operating its
companies.
Employees
The Company is currently has no full-time employees. Directors and
executive officers will devote only such time to the affairs of the Company
as they deem appropriate, which is estimated to be approximately 10 hours
per month per person. Management of the Company expects to use consultants,
attorneys, and accountants as necessary, and does not anticipate a need to
engage any full-time employees so long as it is seeking and evaluating
businesses. The need for employees and their availability will be
addressed in connection with a decision whether or not to acquire or
participate in a specific business industry.
Item 2. Financial Information.
Plan of Operation.
- ----------------------
Other than assisting its companies, the Company has not engaged in any
material operations or had any revenues from operations during the past fiscal
year. The Company's plan of operation for the next 12 months is to continue to
assist in the development of its companies.
During the next 12 months, the Company's only foreseeable cash requirements
will relate to maintaining the Company in good standing or the payment of
expenses associated with assisting in the development of its companies. The
Company is unable at this time to predict the amount of any such expenses. The
Company's officers, directors, principals and afficialtes intend to loan the
Company any funds needed for such operations. However, there are no preliminary
agreements or understandings with respect to loan agreements by officers,
directors, principals or affiliates of the Company and any such loan will not
exceed $25,000 and will be on terms no less favorable to the Company than would
be available from a commercial lender in an arm's length transaction. As of the
date of this Registration Statement, the Company has not actively begun to seek
any such loans.
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Results of Operations.
- -------------------------
Other than assisting its companies, the Company has had no material
operations in the last 12 months. The Company's operations have been limited to
activities to keep the Company in good standing and activities with respect to
assisting in the development of its companies. These activities have included,
for example, confirming good standing, reviewing stock transfer records and
Articles of Incorporation, as amended, and arranging for the preparation and
auditing of financial statements. These activities were undertaken in
contemplation of the preparation of this filing.
Liquidity.
- -------------
The Company had no liquidity during the period ended February 29, 2000. The
Company is contemplating raising capital over the next twelve months by
issuance of debt or equity securities. The Company has no loan agreements with
any officer or director.
If there are no funds available, it is expected that management would purchase
stock in the Company to pay these liabilities in hopes of enhancing the value of
their stock ownership.
Item 3. Properties.
The Company maintains it's corporate office at 1432 Court Street,
Clearwater, Florida 33756 under an informal arrangement with the Company's
President. This space is deemed adequate for the foreseeable future.
Item 4. Security Ownership of Certain Beneficial Owners and Management.
The following table sets forth information as of the date of this
Registration Statement regarding certain Ownership of the Company's outstanding
Common Stock by all officers and directors individually, all officers and
directors as a group, and all beneficial owners of more than five percent of the
common stock.
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Name and Address Shares Owned Beneficially(1) Percent of Class
- ----------------- ---------------------------- ------------------
L&M Group, L.C. 1,800,000 22.0%
(1) A person is deemed to be the beneficial owner of securities that can be
acquired by such person within 60 days from the date of the registration
statement upon the exercise of options or warrants. Each beneficial owner's
percentage ownership is determined by assuming that options or warrants that are
held by such person (but not those held by any other person) and which are
exercisable within 60 days of the date of this registration statement have been
exercised. Unless otherwise indicated, the Company believes that all persons
named in the table have voting and investment power with respect to all shares
of common stock beneficially owned by them.
Item 5. Directors and Executive Officers.
The executive officers, directors, and key employees of the Company are as
follows:
Name Position
Robert Montemarano Chairman, President, CEO & Director
B. Adam Fowler, Jr. Director
Oscar Kuperman Director
Mr. Montemarano will act as interim company President, at no salary, until
sufficient funds are available to secure additional professional management
position(s) for the Company.
Officers will be elected and/or hired upon review of qualifications.
Robert Montemarano, Age 38
Mr. Montemarano is the founder of the Company and has been a Director,
President, Secretary and Treasurer since the Company's inception. He is
responsible for the financial and day-to-day management of the Company and
oversees the Company's business operations. Mr. Montemarano is also a member of
the L&M Group, L.C. ("L&M"). Since February, 1994 through the present, Mr.
Montemarano, as an owner and consultant of L&M, has provided management
consulting services to privately held companies. Prior to co-founding L&M, from
June, 1992 until February, 1994, Mr. Montemarano was self-employed as a business
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consultant providing financial consulting services to privately held companies.
From March, 1987, through June, 1992, Mr. Montemarano was a Senior Examiner with
the Florida Comptroller Division of Securities and Investor Protection. From
1981 through February, 1983, he was a research analyst with Paine Webber Jackson
& Curtis. From February , 1983 through August, 1983, he was a research analyst
for the National Westminster Bank. From December, 1983 until February, 1987, he
was a research analyst for Dean Witter Reynolds.
B. Adam Fowler, Jr.
Mr. Fowler is a resident of Greenwood, Mississippi, where he serves as Co-Owner,
Secretary & Treasurer of McCormick & Co., one of Mississippi's leading Wholesale
Grocery companies. Mr. Fowler has been affiliated with McCormick & Co. since
1981. Additionally, he serves as Vice President of the Delta Investment Club.
Oscar Kuperman
Mr. Kuperman is a Senior Vice President of Donaldson, Blackwell & Company, Vice
President of Investments for R.S. Coleman and President of Eko Enterprises, Inc.
an international consulting and trading firm. Mr. Kuperman is also a
retail/institutional broker with Barrett Day Securities.
The officers and Directors of the Company will devote only such time as
they deem appropriate in the business Affairs of the Company. It is, however,
expected that the President and Secretary will devote the majority of their time
to the business of the Company.
Each executive officer is elected by the Board of Directors at its first
meeting after each annual meeting of the shareholders and serves until such time
as his successor is elected.
PEP's Advisory Board
Compensation
Advisory Board Members are called upon, from time to time, to assist in the
Company's evaluation of a specific company related to one or more of the
Advisor's specific area(s) of expertise.
On January 14, 1998, PEP's Advisory Board Members were issued twenty thousand
(20,000) shares of *Restricted PEP Common Stock and an **option to purchase an
additional twenty thousand (20,000) shares of PEP Common Stock at $2.50 per
share.
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The Company's Advisory Board Members are not directly compensated for their
individual contributions to the Company's operation, however, Management has
agreed to reimburse Advisors for out-of-pocket expenses incurred during their
due diligence investigations, travel, research costs, etcIn the future,
Management may negotiate stock options with companies targeted for investment or
acquisition, and may elect to issue such options, or a pro-rata share thereof,
to the Advisory Board Members.
* Shares issued to Advisory Board Members, on January 14, 1998, are
Restricted from sale, for one (1) year, pursuant to Rule 144.
** Advisory Board Members also received a two (2) year option to purchase an
additional twenty thousand (20,000) shares of PEP Common Stock at a price of
$2.50 per share.
PEP's Advisory Board
in alphabetical order
Advisor Industry
Mr. Wally "Famous" Amos Entrepreneur / Motivational Speaker
Mr. John Astrab Executive Search
Mr. Rud Bergfeld Finance
Mr. Peter Dominici Corporate Treasury and Financial Services
Mr. Marvin Duryea Product Fulfillment
Dr. Anthony Massie, D.M.D. Dentistry
Dr. Ralph Nurnberger, Ph.D. Political Consultant
Mr. Charles S. Stuart Motivational Speaker
Mr. Markham D. Tuft Product Development and Evaluation
Advisor Industry
Mr. Wally Amos Marketing
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Mr. Amos has attained world famous status as an Entrepreneur, Marketer, and
Motivational Speaker. Mr. Amos is the founder of the Uncle No-name Cookie
Company, based in Hauppauge, New York. Mr. Amos previously co-founded the
"Famous Amos" Cookie Empire (1975) and also enjoyed a successful term managing
musical talent acts (e.g. the late Marvin Gaye) for the William Morris agency in
New York (circa 1970).
Mr. John Astrab Executive Search
Mr. Astrab has served PEP's Advisory Board since the Company's inception. Mr.
Astrab co-founded one of the nation's leading executive search and staffing
firms, Romac International (1984), NASDAQ "ROMC", and served as Division
President and currently consults for Romac. Prior experience includes Sales
Management and Registered Representative in the Insurance, Investment and Real
Estate industries.
Mr. Rud Bergfeld Finance
Mr. Bergfeld has enjoyed a successful career as an Entrepreneur, Venture
Capitalist, and Turnaround Expert since 1971. Mr. Bergfeld also serves as a
Guest Lecturer for Georgetown University and a Keynote Speaker for The American
Trade Association. Prior to engaging his career in the Financial Industry, Mr.
Bergfeld served twelve (12) years with the U.S. Navy, Joint Chiefs of Staff.
Mr. Peter Dominici Corporate Treasury and Financial Services
In addition to serving on PEP's Advisory Board, Mr. Dominici currently serves as
Vice-President, Treasurer and Director of Romac International, Inc. NASDAQ
"ROMC", one of the Nation's leading specialty staffing services firms. Mr.
Dominici previously served as Romac's Chief Financial Officer and Secretary
since its inception in 1994. From 1986 to 1994, Mr. Dominici served as Chief
Financial Officer and Secretary of Romac's predecessor company, FMA
International, IncMr. Dominici is also a Certified Public Accountant with seven
(7) years of public accounting experience encompassing extensive audit, tax and
public company reporting responsibilities.
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Mr. Marvin Duryea Product Fulfillment
In addition to serving on PEP's Advisory Board, Mr. Duryea maintains a
controlling ownership interest in, and was the founder of, Brockport
Enterprises, Inc., located in Brockport, New York, a product fulfillment center
servicing Fortune 500 companies, such as Kodak, since 1967. Mr. Duryea also
served on the Advisory Board of The Chase Lincoln First Bank of Rochester, New
York and has been active in the Rotary organization for several years.
Dr. Anthony Massie, D.M.D. Dentistry
Dr. Massie operates a successful dental practice in Tarpon Springs, Florida. He
is also an expert witness for Florida's Medicaid Anti-Fraud Unit. Dr. Massie
has also served on Florida's Board of Dental Examiners reviewing applicants for
Florida State Dental licensure. Dr. Massie is also an avid investor who has
participated in several entrepreneurial ventures (including companies funded by
PEP) and real estate transactions.
Dr. Ralph Nurnberger, Ph.D. Political Consultant
Dr. Nurnberger is the government affairs counselor for Preston, Gates, Ellis,
Rouvelas, Meeds, LLP, a Washington, D.C. based political consulting firm which
represents emerging technology firms, the India Abroad Center for Political
Awareness, and a number of Middle East-related interests. Dr. Nurnberger has
served over eight years as a Legislative Liaison for the American Israel Public
Affairs Committee (AIPAC), widely acknowledged as "the most effective public
policy lobby in Washington". In addition to teaching graduate level courses in
Congress and International Relations at Georgetown University, Dr. Nurnberger
lectures extensively on subjects ranging from foreign policy to the American
political process.
Mr. Charles S. Stuart Motivational Speaker
Mr. Charles S. Stuart is recognized as one of the Nation's leading Motivational
Speakers, consultants, and corporate trainers. Mr. Stuart speaks to companies
and organizations around the world. Clients include prominent manufacturing,
marketing, accounting, law, healthcare and not-for-profit service organizations.
Mr. Stuart is a member of the National Speakers Association (NSA), the American
Society for Training and Development (ASTD), and has served as an adjunct
Professor of Marketing at Rollins College.
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Mr. Markham D. Tuft Product Development and Evaluation
Mr. Tuft is nearing retirement from thirteen (13) years of service with Lockheed
Martin. During his employ with Lockheed Martin, Mr. Tuft has been involved in
extensive contract negotiations with the U.S. Government and several foreign
governments. Mr. Tuft has participated in research, development, technology
validation, low rate production, and full scale production. Further, his
technology experience includes the study and review of Electro-Optics, full
electromagnetic spectrum sensors, non-invasive medical simulation training
devices, and underwater remote locating and cutting devices. Prior to beginning
his career in the private sector, Mr. Tuft enjoyed a twenty-six (26) year career
with the United States Navy retiring as a Captain, where he was designated an
Anti-Air Warfare and Anti-Submarine Warfare technology specialist.
Item 6. Executive Compensation.
The Company has no employment agreements with any of its employees, officer
or directors. The Company is not obligated to pay any compensation to any
officer, director or employee. The Board of Directors may consider awarding such
compensation when the Company is sufficiently developed.
Stock Option Plans
The Company has no stock option or bonus plans for its employees.
Item 7. Certain Relationships and Related Transactions.
In March, 2000, the Company sold 5,000 shares at $1.00 per share to three
individuals in a private sale.
In 1999, the Company issued 72,000 shares to Mr. Montemarano in exchange for
work performaed for the Company. In February and March, 2000, the Company
issued 18,000 shares to Mr. Montemarano in exchange for work performaed for the
Company. Mr. Montemarano subsequently gifted these shares to others.
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In 1999, the Company issued 278,500 shares to nine individuals for consulting
services related to the development of the Company's business. In February,
2000, the Company issued 20,000 shares to nine individuals for consulting
services related to the development of the Company's business.
In 1999, the Company issued 185,000 shares to unrelated parties in exhange for
securities related to the Company's businesses.
Item 8. Legal Proceedings.
The Company is not currently involved in any litigation nor, to the
Company's knowledge, is any litigation currently threatened against the Company.
Item 9. Market Price of and Dividends on the Registrant's Common Equity and
Related Stockholder Matters.
Common Stock
There has not been any market for the Common Stock of PEP Management
Corporation. No cash dividends have been declared for the last two fiscal years.
As of February 29, 2000, there were approximately 290 holders of record and
7,548,503 shares outstanding of the Company's Common Stock, $0.001 par value.
Preferred Stock
There are no outstanding shares of the Company's preferred stock.
Item 10. Recent Sales of Unregistered Securities.
578,500 shares of Common Stock, par value $0.001 (the "Shares"), have been
issued by the Company within one year prior to the filing of this Form 10.
In March, 2000, the Company sold 5,000 shares at $1.00 per share to three
individuals in a private sale.
In 1999, the Company issued 72,000 shares to Mr. Montemarano in exchange for
work performaed for the Company. In February and March, 2000, the Company
issued 18,000 shares to Mr. Montemarano in exchange for work performaed for
the Company. Mr. Montemarano subsequently gifted these shares to others.
In 1999, the Company issued 278,500 shares to nine individuals for consulting
services related to the development of the Company's business. In February,
2000, the Company issued 20,000 shares to nine individuals for consulting
services related to the development of the Company's business.
In 1999, the Company issued 185,000 shares to unrelated parties in exhange for
securities related to the Company's businesses.
All of the above transactions were made pursuant to the exemption for private
transactions afforded by Section 4(2) of the Securities Act of 1933.
Item 11. Description of Registrant's Securities to be Registered.
The Company is authorized to issue 50,000,000 shares of common stock, $.001
par value, of which, as of February 29, 2000, there were 7,548,503 shares are
outstanding.
Holders of shares of Common Stock are entitled to one vote per share. None of
the shares have or will have preemptive or cumulative voting rights, be
redeemable or be liable for assessments or further calls. None of the shares
will have any conversion rights. The holders of Common Stock are entitled to
dividends, when and as declared by the Board of Directors from funds legally
available therefor and upon liquidity to share pro rata in any distribution to
shareholders. The Company does not anticipate declaring or paying any cash
dividends in the foreseeable future. Any earnings, at least for such period
will be retained to finance the development and expansion of its business.
Thereafter, the payment of dividends will be determined by the Board of
Directors in light of conditions then existing, including the Company's
financial condition, capital requirements, business conditions and other
factors.
The Company has authorized 25,000,000 shares of Preferred Stock, no par value,
to be issued in such series and with such designations, rights, privileges, and
preferences, splits, conversions and other issues as shall be determined from
time to time by the board of directors of the Company. No such shares have ever
been issued.
Transfer Agent
The Company's transfer agent is American Stock Transfer, 1825 Lawrence
Street, Suite 444, Denver, Colorado 80201-1596 and its telephone number is
303-298-5370.
Item 12. Indemnification of Directors and Officers.
There are no present provisions in the Articles of Incorporation or By-Laws
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of the Company providing that the Company shall indemnify the directors and
officers of the Company.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933, as amended (the "Securities Act"), may be permitted to Arbor's
directors, officers and controlling persons pursuant to the foregoing
provisions, or otherwise, we have been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public policy
as expressed in the Securities Act and is, therefore, unenforceable.
Item 13. Financial Statements and Supplementary Data.
The Company's financial statements and supplementary data is in the process
of being prepared by the Company's accountants, Richard J. Fuller, P.A.,
Clearwater, Florida and will be filed as soon as these statements are
available.
Item 14. Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure.
None.
Item 15. Financial Statements and Exhibits.
a) List separately all financial statements filed as part of the registration
statement.
The Company's financial statements and supplementary data is in the process
of being prepared by the Company's accountants, Richard J. Fuller, P.A. and will
be filed as soon as these statements are available.
The following are the financial statements and supplementary date for the
previous period.
(b) Furnish the exhibits required by Item 601 of Regulation S-K.
* 3.1 -- Certificate of Incorporation, as amended to date, effective
September 8, 1998.
* 3.2 -- Bylaws of the Company
----------------
* Filed herewith
----------------
EXHIBITS.
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PEP Management Corporation
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
2240 Belleair
Road, Suite 295
Clearwater, Florida 33764
Richard J. Fuller, C.P.A. (813) 536-2101
Certified Public Accountants and Consultant Fax (813) 536-2389
Richard J. Fuller. C.P.A.
Maryann G. Orsagos, C.P.A.
The Board of Directors
PEP EQUI77ES CORPORATION
(Formerly Centurion Insurance Services, Inc.)
American Institute Clearwater, Florida
of Certified Public Accountants
I have compiled the accompanying balance sheet of PEP EQUITIES CORPORATION
as of June 30, 1998 and the related statement of net loss, statement of cash
flows, and statement of changes in stockholders' equity for the period then
ended, in accordance with Statements of Standards of Accounting and Review
Services issued by the American Institute of Certified Public Accountants.
A compilation is limited to presenting in the form financial statements
information that is the representation of management. I have not audited or
reviewed the accompanying financial statement and, accordingly do not express an
opinion or any other form of assurance on them.
As discussed in Note 2 to the financial statements, investments not readily
marketable amounting to $5,047,160 as of June 30, 1998, have been valued at fair
market value as determined by the Board of Directors.
7he accompanying supplementary information for the period ended June 30, 1998 is
presented only for awlys7s purpose and has been compiled by me without audit or
review, from information that is the representation of management, and I do not
express an opinion or any other form of assurance on such information.
August 17, 1998
Richard J. Fuller, CPA, PA
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PEP EQUITY CORPORATION
(Formerly Centurion Insurance Service, Inc.)
(A Development Stage Company)
Balance Sheet
June 30, 1998
ASSETS
Current Assets
Cash $ 6,855
Investments 5,047,160
Total Current Assets 5,054,015
Other Assets
Other Assets
TOTAL ASSETS $ 5,054,015
LIABILITIES AND STOCKHOLDERS' EQUITY
Subscribed Stock $ 10,000
Total Liabilities 10,000
Shareholders' Equity
Preferred Stock, 5,000,000
Shares Authorized,no par value,
none Issued and Outstanding -
Common Stock, 10,000,000
Shares Authorized,
S.001 par value, 6,456,900
Issued & Outstanding 6,457
Paid-in Capital 5,642,003
Deficit accumulated during
The development stage (564,445)
Treasury Stock (40,000)
Total Stockholders' Equity 5,044,015
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $ 5,054,015
See Accountant's Report and Notes to Financial Statements
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PEP EQUITIES CORPORATION
(Formerly Centurion Insurance Service, Inc.)
(A Development Stage Company)
Statement of Net Loss
For the Six Months Ending June 30, 1998 and the Period
from January 2, 1991 (Inception) to June 30, 1998
Year to Date Since Inception
Revenue
Total Revenues $ - $
Operating Expenses
Operating Expenses 446,040 564,445
Total Operating Expenses 446,040 564,445
Net Loss $ 446,040 $ 564,445
See Accountant's Report and Notes to Financial Statement
19
<PAGE>
PEP EQUITIES CORPORATION
(Formerly Centurion Insurance Service, Inc.)
(A Development Stage Company)
Statement of Cash Flows
For the Six Months Ending June 30,1998 and the Period
from January 2, 1991 (Inception) to June 30, 1998
Year to Date Since Inception
Cash flow from operating activities-
Cash paid to suppliers and employees $ 440,145 $ 552,736
Net cash used by operating activities 440,145 552,736
Cash flow from investing activities:
Investment purchased (10,000) (10,000)
Cash flow from financing activities-
Proceeds from issuance of common stock 487,000 599,591
Common stock subscribed 10,000 10,000
Treasury stock acquired (40,000) (40,000)
Net Cash provided by financing activities 457,000 569,591
Net increase in cash and equivalents 6,855 6,855
Cash and equivalents, beginning of period 0 0
Cash and equivalents, end of period $ 6,855 $ 6,855
Reconciliation of net loss to met cash
used by operating activities
Net Loss $ 446,040 $ 564,445
Adjustments to reconcile net income to net
cash provided by operating activities:
Issuance of Common Stock (1,115) (5,769)
Decrease in payable 98 -
Unrealized loss on investments (4,878) (5,940)
Total Adjustments (5,895) (11,709)
Net cash used by operating activities $ 440,145 $ 552,736
See Accountant's Report and Notes to Financial Statements
20
<PAGE>
<TABLE>
<CAPTION>
PEP EQUITIES CORPORATION
(Formerly Centurion Insurance Service, Inc.)
(A Development Stage Company)
Statement of Changes in Stockholders' Equity
For the Six Months Ending June 30, 1998 and the Period
from January 2, 1991 (Inception) to June 30,1998
PREFERRED COMMON PAID-IN
STOCK STOCK CAPITAL DEFICIT
---------- ------- ---------- ----------
<S> <C> <C> <C> <C>
January 2, 1991 -
December 31, 1997 $ - 4,866 $5,155,479 $(118,405)
Sale Of 475,500 Shares Of
Common Stock S.001 Par
Value January 1, 1998 To
June 30, 1998 - 476 496,524 -
Issuance Of 1,114,700 Shares Of
Common Stock $.001 Par Value
January 1, 1998 To June 30, 1998
At Par Value - 1,115 - 1,115
Net Loss For Six Months Ending
June 30, 1998 - - - (446,040)
---------- ------- ---------- ----------
June 30, 1998 $ 6,457 $ 6,457 $5,642,003 $(564,445)
---------- ------- ---------- ----------
</TABLE>
See Accountant's Report and Notes to Financial Statements
SUPPLEMENTARY INFORMATION
21
<PAGE>
PEP EQUITUES CORPORATION
(Formerly Centurion Insurance Service, Inc.)
(A Development Stage Company)
Statement or Operating Expenses
For the Six Months Ending June 30, 1999 and the Period
from January 2, 1991 (Inception) to June 30, 1998
Year to Date Since Inception
-------------- ----------------
Operating Expenses:
Underwriting Expenses S 211,016 $ 259,298
Consultants and Clerical Support 31,172 46,291
Due Diligence Expenses 17,162 27,264
Salaries - 22,818
Office and Miscellaneous Expenses 73,022 89,453
Legal and Professional Fees 63,790 66,496
Unrealized Loss on Investments 4,878 5,940
Slush Expenditures - Seed Capital 45,000 45,000
Amortization Expense - 1,885
Operating Expenses $ 446,040 $ 564,445
See Accountant's Report and Notes to Financial Statements
22
<PAGE>
PEP EQUITUES CORPORATION
(Formerly Centurion Insurance Service, Inc.)
(A Development Stage Company)
June 30, 1998
Notes to Financial Statements
Note I - Nature or Business and Significant Accounting Policies
The company was incorporated under the laws of the State of Florida on January
2, 199 1. On February 27, 1997, the Company changed its name from Centurion
Insurance Services, Inc. to PEP Equities Corporation after certain
restructuring.
The Company is considered to be a development stage company in accordance with
SFAS No. 7. As a development stage company, the Company presents financial
statements in conformity with generally accepted accounting principles that
apply to established operating enterprises, In addition, the company presents
cumulative information during the development stage. The Company seeks
acquisition of viable business operation. The Company will provide funding and
management consulting services for emerging growth companies. As a result of
certain offerings, the Company plans to acquire certain equity positions.
Planned operations will commence once the Company has equity financing in
position. The Company's accounting year end is December 31.
Investments - The Company accounts for investments in equity securities in
accordance with SFAS No. 115 with trading securities carried at market value
with unrealized gains or losses reflected in the income statement, securities
held to maturity carried at amortized cost; and, securities available for sale
carried at market value with unrealized gains and losses, net of deferred income
taxes, included with stockholders' equity. Fair market value is based upon
sales prices or bid-and-ask quotations currently available on a securities
exchange registered with the
23
<PAGE>
PEP EQUITUES CORPORATION
(Formerly Centurion Insurance Service, Inc.)
(A Development Stage Company)
June 30, 1998
*
Note I - Nature or Business and Significant Accounting Policies (Continued)
Securities and Exchange Commission (SEC) or the over-the-counter market,
provided that those prices or quotations for the over-the-counter market are
publicly reported by the National Association of Securities Dealers Automated
Quotations systems or by the National Quotation Bureau. Where prices of
securities are not readily available through a securities exchange or other
market, the Board of Directors makes a good faith determination of the fair
value of the securities, which is the amount that the owner might expect to
receive for the securities in a current sale.
Income Taxes - The Company has no current income tax provision or benefits.
Note 2 - Investments
Investments are valued at fair market value and securities not readily
marketable are valued at fair value as determined by the Board of Directors in
accordance with the Company's significant accounting policies.
During the current period, the Company acquired a restricted equity position in
an additional emerging growth Company. Also, the investment in Fonet Medical
Technologies, Inc., previously made by the Company, was subject to a reverse
split of 5 : 1 during the current period. Those securities that are not readily
marketable include investment securities for which there is no market on a
securities exchange or no independent publicly quoted market, securities that
cannot be publicly offered or sold unless registrations have been affected under
the Securities Act of 1933, or securities that cannot be offered or sold because
of other arrangements, restrictions, or conditions applicable to the securities
or the company. All of the following Companies are related or otherwise
controlled by PEP Equities through equity ownership.
24
<PAGE>
PEP EQUITUES CORPORATION
(Formerly Centurion Insurance Service, Inc.)
(A Development Stage Company)
June 30, 1998
Note 2 - Investments (Continued)
These investments are as follows:
Company Name No. of Shares Fair Market Value
- ----------------------------------- -------------- ------------------
IAMEC Funding, Inc. 175,000. $ 350,000.
International Healthcare
Distributors, Inc. 300,000. 3,000,000.
Special Situation
Securities, Inc. 300,000. 1,500,000.
Equitech International
Corporation 4,830. 1,160.
Dyna-Spark
Technologies, Inc, 100,000. 100,000.
M International Corp 86,000. 86,000.
Fonet Medical
Technologies, Inc. 35,000. 0.
Silver Star
International, Inc, 20,000. 10,000.
Investments, at fair market value $ 5,047,160.
25
<PAGE>
PEP EQUITUES CORPORATION
(Formerly Centurion Insurance Service, Inc.)
(A Development Stage Company)
June 30, 1998
Note 3 - Related Party Transactions
The Company shares corporate executive offices with L & M Group, LC and other
related companies at no current expense to the Company. In addition, the
Company's officer provides services to the Company at no charge to the Company.
When sufficient funds are available and the Company is operational, expenses
will be charged to the Company. No current provision has been made for these
expenses.
Note 4 - Stockholders' Equity
The Company's common stock is based upon par value of issued and outstanding
common stock. Any amount received for the sale of common stock over par value
is credited to paid-in capital when issued. In all other circumstances, the
Company accounts for the issuance of common stock based upon $.001 per share,
par value, unless the value of goods or services received indicate otherwise.
The Company has issued no preferred stock.
SIGNATURES
Pursuant to the requirements of Section 12 of the Securities Exchange Act
of 1934, the registrant has duly caused this registration statement to be signed
on its behalf by the undersigned, thereunto duly authorized.
PEP Management Corporation
----------------------------
(Registrant)
Date March ---, 2000 By /s/ Robert Montemarano, President
---------------------------------
(Signature)*
*Print name and title of the signing officer under his signature.
26
<PAGE>
EXHIBIT 3.1
AMENDED AND RESTATED
ARTICLES OF INCORPORATION
OF
PEP EQUITIES CORPORATION
ARTICLE I - NAME AND MAILING ADDRESS
The name of the corporation is PEP Equities Corporation, and the mailing address
of the corporation is 1432 Court Street, Clearwater, Florida 33756-6147.
ARTICLE II- DURATION
The corporation shall have perpetual existence.
ARTICLE III- PURPOSE
The corporation may engage m any activity or business permitted under the laws
of the State of Florida.
ARTICLE IV - CAPITAL STOCK
The corporation shall increase its authorized shares of capital stock to
Seventy-Five Million (75,000,000) shares, designated as follows (a) Fifty
30
<PAGE>
Million (50,000,000) shares of common stock, par value $ .001 per share, which
shall be designated as "Common Stock", and (b) Twenty-Five Million shares of
preferred stock, no par value per share, which shall be designated "preferred
stock", to be issued in such series with such designations, rights, privileges
and preferences, dividends, splits, conversions or other issues as shall be
determined from time to time by the board of directors of the corporation.
1 of 2
ARTICLE V REGISTERED OFFICE AND REGISTERED AGENT
The street address of the registered office of the corporation is 1432 Court
Street, Clearwater, Florida 33756-6147, and the name of the registered agent of
the corporation at that address is Robert Montemarano.
ARTICLE VI- INDEMIFICATION
The corporation reserves the right to amend or repeal any provision contained in
the Articles of Incorporation, or any amendment thereto, and any right conferred
upon the shareholders is subject to this reservation.
The undersigned hereby certifies that the sole director of the corporation
adopted these Amended and Restated Articles of Incorporation on the 9th day of
June 1998.
In witness whereof the undersigned has executed these Amended and Restated
Articles of Incorporation of the Corporation as of the 9th day of June 1998.
/s/ Robert Montemarano
--------------------------------------
Robert Montemarano
President
31
<PAGE>
EXHIBIT 3.2
BYLAWS
OF
PEP MANAGEMENT CORPORATION
ARTICLE I. MEETINGS OF SHAREHOLDERS
Section 1. Annual Meeting. The annual meeting of the shareholders of this
corporation shall be held at the time and place designated by the Board of
Directors of the corporation. The annual meeting of shareholders for any year
shall be held no later than thirteen (13) months after the last preceding annual
meeting of shareholders. Business transacted at the annual meeting shall
include the election of directors of the corporation
Section 2. special Meetings. Special meetings of the shareholders shall be
held when directed by the Board of Directors, or when requested in writing by
the holders of not less than ten percent (10%) of all the shares entitled to
vote at the meeting. A meeting requested by shareholders shall be called for a
date not less than ten (10) nor more than sixty (60) days after the request is
made, unless the shareholders requesting the meeting designate a later date.
The call for the meeting shall be issued by the Secretary, unless the President,
Board of Directors, or shareholders requesting the meeting designate another
person to do so
Section 3. Place. Meetings of shareholders may be held within or
without the State of Florida
Section 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 not less than ten (10) nor more than
sixty (60) days before the meeting, either personally or by first class mail, by
or at the direction of the President, the Secretary, or the officer or
persons calling the meeting to each shareholder of record entitled to vote at
such meeting. If mailed, such notice shall be deemed to be delivered when
deposited in the united States mail addressed to the shareholder at his address
as it appears on the stock transfer books of the corporation, with postage
thereon prepaid.
Section 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 at the adjourned
meeting any business may be transacted 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 this section to each shareholder
of record on the new record date entitled to vote at such meeting.
Section 6. Closing of Transfer Books and Fixing Record Date. For the purpose
of determining shareholders entitled to notice of or to vote at any meeting
of shareholders or any adjournment thereof, or entitled to receive
payment of any dividend, or in order to make a determination of shareholders
for any other purpose, the Board of Directors may provide that the stock
transfer books shall be closed for a stated period but not to exceed, in any
case, sixty (60) days. If the stock transfer books shall be closed for the
purpose of determining shareholders entitled to notice of or to vote at a
meeting of shareholders, such books shall be closed for at least ten days
immediately preceding such meeting
32
<PAGE>
In lieu of closing the stock transfer books, the Board of Directors may fix in
advance a date as the record date for any determination of shareholders, such
date in any case to be not more than sixty (50) days and, in case of a meeting
of shareholders, not less than ten (10) days prior to the date on which the
particular action requiring such determination of shareholders is to
be taken
If the stock transfer books are not closed and no record date is fixed for the
determination of shareholders entitled to notice or to vote at a meeting of
shareholders, or shareholders entitled to receive payment of a dividend, the
date on which notice of the meeting is mailed or the date on which
the resolution of the Board of Directors declaring such dividend is adopted, as
the case may be, shall be the record date for such determination of shareholders
When a determination of shareholders entitled to vote at any meeting of
Shareholders has been made as provided in this section, such determination
shall apply to any adjournment thereof, unless the Board of Directors fixes
a new record date for the adjourned meeting
Section 7. Voting Record. The officers or agent having charge of the stock
transfer books for shares of the 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, the meeting on demand of any - share-holder in person or by proxy,
shall be adjourned until the requirements are complied with. 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.
Section 8. Shareholder Quorum and Voting. 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 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.
33
<PAGE>
If a quorum is present, the affirmative vote of the majority of the shares
represented at the meeting and entitled to vote on the subject matter shall be
the act of the shareholders unless otherwise provided by law.
After a quorum has been established at a shareholders meeting, the subsequent
withdrawal of shareholders, so as to reduce the number of shareholders 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.
Section 9. Voting of Shares. Each outstanding share, regardless of
class, shall be entitled to one vote on each matter submitted to a vote at a
meeting of shareholders.
Treasury shares, shares of stock of this corporation owned by another
corporation the majority of the voting stock of which is owned or controlled by
this corporation, and shares of stock of this corporation held by it in a
fiduciary capacity shall not be voted, directly or indirectly, at any meeting,
and shall not be counted in determining the total number of outstanding shares
at any given time.
A shareholder may vote either in person or by proxy executed in writing by the
shareholder or his duly authorized attorney-in-fact.
At each election for directors every shareholder entitled to vote at such
election shall have the right to vote, in person or by proxy, the number of
shares owned by him for as many persons as there are directors to be elected at
that time and for whose election he has a right to vote.
Shares standing in the name of another corporation, domestic or foreign, may
be voted by the officer, agent, or proxy designated by the bylaws of the
corporate shareholder; or, in the absence of any applicable bylaw, by such
person as the Board of Directors of the corporate shareholder may designate.
Proof of such designation may be made by presentation of a certified copy of the
bylaws or other instrument of the corporate shareholder.
In the absence of any such designation, or in case of conflicting designation by
the corporate shareholder, the chairman of the board, president, any vice
president, secretary and treasurer of the corporate shareholder shall be
presumed to possess, in that order, authority to vote such shares
34
<PAGE>
Shares held by an administrator, executor, guardian or conservator may be
voted by him, either in person or by proxy, without a transfer of such shares
into his name. Shares standing in the name of a trustee may be voted by him,
either in person or by proxy, but-no trustee shall be entitled to vote shares
held by him without a transfer of such shares into his name
Shares standing in the name of a receiver may be voted by such receiver, and
shares held by or under the control of a receiver may be voted by such receiver
without the transfer thereof into his name if authority so to do be contained
in an appropriate order of the court by which such receiver was
appointed
A shareholder whose shares are pledged shall be entitled to vote such shares
until the shares have been transferred into the name of the pledgee, and
thereafter the pledgee or his nominee shall be entitled to vote the shares so
transferred
On and after the date on which written notice of redemption of redeemable shares
has been mailed to the holders thereof and a sum sufficient to redeem such
shares has been deposited with a bank or trust company with irrevocable
instruction and authority to pay the redemption price to the holders thereof
upon surrender of certificates thereof, such shares shall not be entitled to
vote on any matter and shall not be deemed to be outstanding shares
Section 10. Proxies. Every shareholder entitled to vote at a meeting of
shareholders or to express consent or dissent without a meeting or a
shareholders' duly authorized attorney-in-fact may authorize another person or
persons to act for him by proxy
Every proxy must be signed by the shareholder or his attorney-in-fact.
No proxy shall be valid after the expiration of eleven (11) months from the
date thereof unless otherwise provided in the proxy. Every proxy shall be
revocable at the pleasure of the shareholder executing it, except as otherwise
provided by law.
The authority of the holder of a proxy to act shall not be revoked by the
incompetence or death of the shareholder who executed the proxy unless,
before the authority is exercised, written notice of an adjudication of such
incompetence or of such death is received by the corporate office responsible
for maintaining the list of shareholders.
If a proxy for the same shares confers authority upon two or more persons and
does not otherwise provide, a majority of them present at the meeting, or if
only one is present then that one, may exercise all the powers conferred by the
proxy; but if the proxy holders present at the meeting are equally divided as to
35
<PAGE>
the right and manner of voting in any particular case, the voting of such shares
shall be prorated.
If a proxy expressly provides, any proxy holder may appoint in writing a
substitute to act in his place.
Section 11. Voting Trusts. Any number of shareholders of this corporation may
create a voting trust for the purpose of conferring upon a trustee or trustees
the right to vote or otherwise represent their shares, as provided by law.
Where the counterpart of a voting trust agreement and the copy of the
record of the holders of voting trust certificates has been deposited
with the corporation as provided by law, such documents shall be subject to
the same right of examination by a shareholder of the corporation, in
person or by agent or attorney, as are the books and records of the
corporation, and such counterpart and such copy of such record shall be subject
to examination by any holder of record of voting trust certificates either in
person or by agent or attorney, at any reasonable time for any proper purpose.
Section 12. Shareholders' Agreements. Two (2) or more shareholders, of
this corporation may enter an agreement providing for the exercise of
voting rights in the manner provided in the agreement or relating to any
phase of the affairs of the corporation as provided by law. Nothing therein
shall impair the right of this corporation to treat the shareholders of record
as entitled to vote the shares standing in their names.
Section 13. Action by Shareholders Without a Meeting. Any action required by
law, these bylaws, or the articles of incorporation of this corporation to
be taken at any annual or special meeting of shareholders of the corporation, or
any action which may be taken at any annual or special meeting of such
shareholders, may be taken without a meeting, without prior notice and
without a vote, if a consent in writing, setting forth the action so taken,
shall be signed by the holders of outstanding stock having not less than the
minimum number of votes that would be necessary to authorize or take such action
at a meeting at which all shares entitled to vote thereon were present and
voted. If any class of shares is entitled to vote thereon as a class, such
written consent shall be required of the holders of a majority of the shares of
each class of shares entitled to vote as a class thereon and of the total
shares entitled to vote thereon
Within ten (10) days after obtaining such authorization by written consent,
notice shall be given to those shareholders who have not consented in writing.
The notice shall fairly summarize the material features of the authorized action
and, if the action be a merger, consolidated or sale or exchange of assets for
36
<PAGE>
which dissenters rights are provided under this act, the notice shall contain a
clear statement of the right of shareholders dissenting therefrom to be paid
the fair value of their shares upon compliance with further provisions
of this act regarding the rights of dissenting shareholders.
ARTICLE II. DIRECTORS
Section 1. Function. All corporate powers shall be exercised by or
under the authority of, and the business and affairs of a corporation shall be
managed under the direction of, the Board of Directors.
Section 2. Qualification. Directors need not be residents of this state or
shareholders of this corporation
Section 3. Compensation. The Board of Directors shall have authority to fix
the compensation of directors
Section 4. Duties of Directors. A director shall perform his duties as a
director, including his duties as a member of any committee of the board upon
which he may serve, in good faith, in a manner he reasonably believes to be in
the best interests of the corporation, and with such care as an ordinarily
prudent person in a like position would use under similar circumstances.
In performing his duties, a director shall be entitled to rely on information,
opinions, reports or statements, including financial statements and other
financial data, in each case prepared or presented by:
(a) one or more officers or employees of the corporation whom the
director reasonably believes to be reliable and competent in the matters
presented
(b) counsel, public accountants or other persons as to matters which the
director reasonably believes to be within such person's professional or expert
competence, or
(c) a committee of the board upon which he does not serve, duly designated
in accordance with a provision of the articles of incorporation or the bylaws,
as to matters within its designated authority, which committee the director
reasonably believes to merit confidence.
A director shall not be considered to be acting in good faith if he has
37
<PAGE>
knowledge concerning the matter in question that would cause such reliance
described above to be unwarranted.
A person who performs his duties in compliance with this section shall have no
liability by reason of being or having been a director of the corporation.
Section 5. Presumption of Assent. A director of the corporation who
is present at a meeting of its Board of Directors at which action on any
corporate matter is taken shall be presumed to have assented to the action
taken unless he votes against such action or abstains from voting in respect
thereto because of an asserted (conflict of interest
Section 6. Number. This corporation shall have at least one (1) director.
The minimum number of directors may be increased or decreased from time to
time by amendment to these bylaws, but no decrease shall have the effect of
shortening the terms of any incumbent director and no amendment shall decrease
the number of directors below one (1), unless the stockholders have voted to
operate the corporation
Section 7. Election and Term. 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
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.
Section 8. 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. A
director elected to fill a vacancy shall hold office only until the next
election of directors by the shareholders
Section 9. Removal of Directors. At a meeting of shareholders called
expressly for that purpose, any director or the entire Board of Directors may be
removed, with or without cause, by a vote of the holders of a majority of the
shares then entitled to vote at an election of directors
38
<PAGE>
Section 10. Quorum and Voting. A majority of the number of directors fixed by
these bylaws shall constitute a quorum for the transaction of business. 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
Section 11. Director Conflicts of Interest. No contract or other transaction
between this corporation and one (1) or more of its directors or any other
corporation, firm, association or entity in which one or more of the 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
(a) The fact of such relationship or interest is disclosed or known
to the Board of Directors or committee which authorizes, approves or ratifies
the contract or transaction by a vote or consent sufficient for the purpose
without counting the votes or consents of such interested directors; or
(b) The fact of such relationship or interest is disclosed or known to the
shareholders entitled to vote and they authorize, approve or ratify such
contract or transaction by vote or written consent; or
c) The contract or transaction is fair and reasonable as to the corporation at
the time it is authorized by the board; a committee or the shareholders
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
Section 12. Executive and Other Committees. 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, except that no
committee shall have the authority to:
(a) approve or recommend to shareholders actions or proposals required
by law to be approved by shareholders
39
<PAGE>
(b) designate candidates for the office of director, for purposes of proxy
solicitation or otherwise,
(c) fill vacancies on the Board of Directors or any committee thereof
(d) amend the bylaws,
(e) authorize or approve the reacquisition of shares unless pursuant to a
general formula or method specified by the Board of Directors1 or
(F) Authorize or approve the issuance or sale of, or any contract to issue
Or sell, shares or designate the terms of a series of a class of shares, except
That the board of directors, having acted regarding general authorization for
The issuance or sale of shares, or any contract therefor, and, in the case of a
Series, the designation thereof, may, pursuant to a general formula or method
Specified by the board of directors, by resolution or by adoption of a stock
Option or other plan, authorize a committee to fix the terms of any contract for
The sale of the shares and to fix the terms upon which such shares may be issued
Or sold, including, without limitation, the price, the rate or manner of payment
Of dividends, provisions for redemption, sinking fund, conversion, voting or
Preferential rights, and provisions for other features of a class of shares, or
A series of a class of shares, with full power in such committee to~adopt any
Final resolution setting forth all the terms thereof and to authorize the
Statement of the terms of a series for filing with the department of state.
The Board of Directors, by resolution adopted in accordance with this section,
may designate one (1) 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
Section 13. Place of Meetings. Regular and special meetings by
the Board of Directors may be held within or without the State of Florida.
Section 14. Time, Notice and Call of Meetings. Regular meetings by
the Board of Directors shall be held without notice. Written notice of the time
and place of special meetings of the Board of Directors shall be given to each
director by either personal delivery, telegram or cablegram at least two (2)
days before the meeting or by notice mailed to the director at least five (5)
days before the meeting
Notice of a meeting of the Board of Directors need not be given to any director
who signs a waiver of notice either before or after the meeting. Attendance of
a director at a meeting shall constitute a waiver of notice of such meeting and
waiver of any and all objections to the place of the meeting, the time of the
meeting, or the manner in which it has been called or convened, except
when a director states, at the beginning of the meeting, any objection to the
transaction of 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 Board of Directors need be specified in the notice or
waiver of notice of such meeting.
A majority of the directors present, whether or not a quorum exists, may adjourn
any meeting of the Board of Directors to another time and place. 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 are announced at the time of the adjournment, to the other
directors.
Meetings of the Board of Directors may be called by the chairman of the board,
by the president of the corporation, or by any two (2) directors
Members of the Board of Directors may participate in a meeting of such board
by means of a 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
Section 14. Action Without a Meeting. Any action required to be taken at a
meeting of the directors of a corporation, or any action 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 taken, signed by all
of the directors, or all the members of the committee, as the case may be, is
filed in the minutes of the proceedings of the board or of the committee.
Such consent shall have the same effect as a unanimous vote.
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ARTICLE III. OFFICERS
Section 1. Officers. The officers of this corporation shall
consist of a president, a secretary and a treasurer, each of whom shall be
elected by the Board of Directors. Such other officers and assistant
officers and agents as may be deemed necessary may be elected or appointed by
the Board of Directors from time to time. Any two (2) or more offices may be
held by the same person. The failure to elect a president, secretary or
treasurer shall not affect the existence of this corporation.
Section 2. Duties. The officers of this corporation shall have the following
duties:
The President shall be the chief executive officer of the corporation, shall
have general and active management of the business and affairs of the
corporation subject to the directions of the Board of Directors, and shall
preside at all meetings of the stockholders and Board of Directors
The Secretary shall have custody of, and maintain, all of the corporate records
except the financial records; shall record the minutes of all meetings of the
stockholders and Board of Directors, send all notice of meetings out, and
perform such other duties as may be prescribed by the Board of Directors or the
President
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 stockholders 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.
Section 3. Removal of Officers. Any officer or agent elected or appointed
by the Board of Directors may be removed by the board whenever in its judgment
the best interests of the corporation will be served thereby
Any officer or agent elected by the shareholders may be removed only by vote of
the shareholders, unless the shareholders shall have authorized the directors to
remove such officer or agent
Any vacancy, however occurring, in any office may be filled by the Board of
Director~, unless the bylaws shall have exprkssly reserved such power to the
shareholders
Removal of any officer shall be without prejudice to the contract rights, if
any, of the person so removed; however, election or appointment of an
officer or agent shall not of itself create contract rights
ARTICLE IV. STOCK CERTIFICATES
Section 1. Issuance. Every holder of shares in this corporation shall
be entitled to have a certificate, representing all shares to which he is
entitled. No certificate shall be issued for any share until such share is
fully paid
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Section 2. Form. Certificates representing shares in this corporation shall be
signed by the President or Vice President and the Secretary or an Assistant
Secretary and may be sealed with the seal of this corporation or a facsimile
thereof. The signatures of the President or Vice President and the Secretary
or Assistant Secretary may be facsimiles if the certificate is manually signed
on behalf of a transfer agent or a registrar, other than the corporation
itself or an employee of the corporation. In case any officer who signed
or whose facsimile signature has been placed upon such certificate shall have
ceased to be such officer before such certificate is issued, it may be issued by
the corporation with the same effect as if he were such officer at the date of
its issuance.
Every certificate representing shares which are restricted as to the sale,
disposition or other transfer of such shares shall state that such shares are
restricted as to transfer and shall set forth or fairly summarize upon the
certificate, or shall state that the corporation will furnish to any
shareholder upon request and without charge a full statement of, such
restrictions
Each certificate representing shares shall state upon the fact thereof: the
name of the corporation; that the corporation is organized under the laws of
this state; 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.
Section 3. Transfer of Stock. The corporation shall register a stock
certificate presented to it for transfer if the certificate is properly endorsed
by the holder of record or by his duly authorized attorney, and the signature of
such person has been guaranteed by a commercial bank or trust company or by a
member of the New York or American Stock Exchange.
Section 4. Lost, Stolen, or Destroyed Certificates. The corporation shall
issue a new stock certificate in the place of any certificate previously issued
if the holder of record of the certificate (a) makes proof in affidavit form
that it has been lost, destroyed or wrongfully taken; (b) requests the issue of
a new certificate before the corporation has notice that the certificate
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has been acquired by a purchaser for value in good faith and without notice of
any adverse claim; Cc) gives bond in such form as the corporation may
direct, to indemnify the corporation, the transfer agent, and registrar
against any claim that may be made on account of the alleged loss, destruction,
or theft of a certificate; and (d) satisfies any other reasonable requirements
imposed by the corporation
ARTICLE V. BOOKS AND RECORDS
Section 1. Books and Records. This 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.
This corporation shall keep at its registered office or principal place of
business, br 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
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.
Section 2. Shareholders Inspection Rights. Any person who shall have been a
holder of record of shares or of voting trust certificates therefor at least six
months immediately preceding his demand or shall be the holder of record of, or
the holder of record of voting trust certificates for, at least five percent of
the outstanding shares of any class or series of the corporation, upon written
demand stating the purpose thereof, shall have the right to examine, in person
or by agent or attorney, at any reasonable time or times, for any proper
purpose its relevant books and records of accounts, minutes and records of
shareholders and to make extracts therefrom
Section 3. Financial Information. Not later than four (4) months after the
close of each fiscal year, this 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.
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 such balance sheet and profit and loss statement
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The balance sheets and profit and loss statements shall be filed in the
registered office of the corporation in this state, 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
ARTICLE VI. DIVIDENDS
The Board of Directors of this corporation may, from time to time, declare and
the corporation may pay dividends on its shares in cash, property or its own
shares, except when the corporation is insolvent or when the payment
thereof would render the corporation insolvent or when the declaration or
payment thereof would be contrary to any restrictions contained in the articles
of incorporation, subject to the following provisions:
(a) Dividends in cash or property may be declared and paid, except as
otherwise provided in this section, only out of the unreserved and unrestricted
earned surplus of the corporation or out of capital surplus, howsoever arising
but each dividend paid out of capital surplus, and the amount per share paid
from such surplus shall be disclosed to the shareholders receiving the same
concurrently with the distribution
(b) Dividends may be declared and paid in the corporation's own
treasury shares
(c) Dividends may be declared and paid in the corporation's own authorized
but unissued shares out of any unreserved and unrestricted surplus of the
corporation upon the following conditions:
(1) If a dividend is payable in shares having a par value, such shares shall
be issued at not less than the par value thereof and there shall be transferred
to stated capital at the time such dividend is paid an amount of surplus equal
to the aggregate par value of the shares to be issued as a dividend.
(2) If a dividend is payable in shares without par value, such shares shall
be issued at such stated value as shall be fixed by the Board of Directors by
resolution adopted at the time such dividend is declared~ and there shall be
transferred to stated capital at the time such dividend is paid an amount of
surplus equal to the aggregate stated value so fixed in respect of such shares;
and the amount per share so transferred to stated capital shall be disclosed to
the shareholders receiving such dividend concurrently with the payment thereof
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(d) No dividend payable in shares of any class shall be paid to the holders
of shares of any other class unless the articles of incorporation so provide
or such payment is authorized by the affirmative vote or the written
consent of the holders of at least a majority of the outstanding shares of the
class in which the payment is to be made
(e) A split-up or division of the issued shares of any class into a greater
number of shares of the same class without increasing the stated capital of the
corporation shall not be construed to be a share dividend within the meaning of
this section.
ARTICLE VII. CORPORATE SEAL
The Board of Directors shall provide a corporate seal which shall be circular in
form and shall have inscribed thereon the name of the corporation as it appears
on page 1 of these Bylaws.
ARTICLE VIII. AMENDMENTS
These bylaws may be repealed or amended, and new bylaws may be adopted, by the
Board of Directors
End of Bylaws adopted by the Board of Directors.
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