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
LAST AMERICAN EXIT INC.
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(Name of Small Business Issuer)
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New York 11-3560802
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(State or Other Jurisdiction of I.R.S. Employer Identification Number
Incorporation or Organization)
339 New York Avenue
Huntington Village, New York 11743
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(Address of Principal Executive Offices including Zip Code)
631-351-4037
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(Issuer's Telephone Number)
TOSCANO & PUDELL, PC
339 New York Avenue
Huntington Village, NY 11743
Phone: 631.351.4037
Fax: 631.351.4083
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(Name, address and telephone number of agent for service)
Securities to be Registered Under Section 12(b) of the Act:
None
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Securities to be Registered Under Section 12(g) of the Act:
Common Stock $.01 Par Value
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(Title of Class)
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TABLE OF CONTENTS
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PART I
ITEM 1. DESCRIPTION OF BUSINESS................................................3
ITEM 2. PLAN OF OPERATION......................................................8
ITEM 3. DESCRIPTION OF PROPERTY...............................................14
ITEM 4. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT........14
ITEM 5. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS..........14
ITEM 6. EXECUTIVE COMPENSATION................................................17
ITEM 7. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS........................17
ITEM 8. DESCRIPTION OF SECURITIES.............................................17
PART F/S......................................................................22
PART II
ITEM 1. MARKET PRICE AND DIVIDENDS ON COMMON EQUITY; OTHER MATTERS............32
ITEM 2. LEGAL PROCEEDINGS.....................................................31
ITEM 3. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS.........................32
ITEM 4. RECENT SALES OF UNREGISTERED SECURITIES...............................32
ITEM 5. INDEMNIFICATION OF OFFICERS AND DIRECTORS.............................32
PART III
ITEM 1. INDEX TO EXHIBITS
ITEM 2. DESCRIPTION OF EXHIBITS
SIGNATURE
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PART I
ITEM 1. BUSINESS.
LAST AMERICAN EXIT, INC. (the "Company") was incorporated on August 14,
2000 under the laws of the State of New York to engage in any lawful corporate
undertaking, including, but not limited to, selected mergers and acquisitions.
The Company has been in the developmental stage since inception and has no
operations to date other than issuing shares to its original shareholder.
The Company will attempt to locate and negotiate with a business entity for
the combination of that target company with the Company. The combination will
normally take the form of a merger, stock-for-stock exchange or stock-for-assets
exchange. In most instances the target company will wish to structure the
business combination to be within the definition of a tax-free reorganization
under Section 351 or Section 368 of the Internal Revenue Code of 1986, as
amended. No assurances can be given that the Company will be successful in
locating or negotiating with any Target Company.
The Company has been formed to provide a method for a foreign or domestic
private company to become a reporting ("public") company whose securities are
qualified for trading in the United States secondary market.
PERCEIVED BENEFITS
There are certain perceived benefits to being a reporting company with a
class of publicly traded securities. These are commonly thought to include the
following:
- - -- Shareholders ability to obtain more readily available information from
the Company
- - -- The ability to use registered securities to make acquisitions of Assets
or businesses;
- - -- Increased visibility in the financial community;
- - -- The facilitation of borrowing from financial institutions;
- - -- Improved trading efficiency;
- - -- shareholder liquidity;
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- - -- greater ease in subsequently raising capital;
- - -- compensation of key employees through stock options for which there may
be a market valuation;
- - -- enhanced corporate image;
- - -- a presence in the United States capital market.
POTENTIAL TARGET COMPANIES
A business entity, if any, which may be interested in a business
combination with the Company may include the following:
- - -- a company for which a primary purpose of becoming public is the use of
its securities for the acquisition of assets or businesses;
- - -- a company which is unable to find an underwriter of its securities or is
unable to find an underwriter of securities on terms acceptable to it;
- - -- a company which wishes to become public with less dilution of its common
stock than would occur upon an underwriting;
- - -- a company which believes that it will be able to obtain investment
capital on more favorable terms after it has become public;
- - - a foreign company which may wish an initial entry into the United States
securities market;
- - -- a special situation company, such as a company seeking a public market to
satisfy redemption requirements under a qualified Employee Stock Option
Plan;
- - -- a company seeking one or more of the other perceived benefits of becoming
a public company.
A business combination with a target company will normally involve the
transfer to the target company of the majority of the issued and outstanding
common stock of the Company, and the substitution by the target company of its
own management and board of directors.
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No assurances can be given that the Company will be able to enter into a
business combination, as to the terms of a business combination, or as to the
nature of the target company.
The Company is voluntarily filing this Registration Statement with the
Securities and Exchange Commission and is under no obligation to do so under the
Securities Exchange Act of 1934.
RISK FACTORS
The Company's business is subject to numerous risk factors, including the
following:
NO OPERATING HISTORY OR REVENUE AND MINIMAL ASSETS. The Company has had no
operating history nor any revenues or earnings from operations. The Company has
no significant assets or financial resources. The Company will, in all
likelihood, sustain operating expenses without corresponding revenues, at least
until the consummation of a business combination. This may result in the Company
incurring a net operating loss which will increase continuously until the
Company can consummate a business combination with a target company. There is no
assurance that the Company can identify such a target company and consummate
such a business combination.
SPECULATIVE NATURE OF THE COMPANY'S PROPOSED OPERATIONS. The success of the
Company's proposed plan of operation will depend to a great extent on the
operations, financial condition and management of the identified target company.
While management will prefer business combinations with entities having
established operating histories, there can be no assurance that the Company will
be successful in locating candidates meeting such criteria. In the event the
Company completes a business combination, of which there can be no assurance,
the success of the Company's operations will be dependent upon management of the
target company and numerous other factors beyond the Company's control.
SCARCITY OF AND COMPETITION FOR BUSINESS OPPORTUNITIES AND COMBINATIONS. The
Company is and will continue to be an insignificant participant in the business
of seeking mergers with and acquisitions of business entities. A large number of
established and well-financed entities, including venture capital firms, are
active in mergers and acquisitions of companies which may be merger or
acquisition target candidates for the Company. Nearly all such entities have
significantly greater financial resources, technical expertise and managerial
capabilities than the Company and, consequently, the Company will be at a
competitive disadvantage in identifying possible business opportunities and
successfully completing a business combination. Moreover, the Company will also
compete with numerous other small public companies in seeking merger or
acquisition candidates.
IMPRACTICABILITY OF EXHAUSTIVE INVESTIGATION. The Company's limited funds and
the lack of full-time management will likely make it impracticable to conduct a
complete
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and exhaustive investigation and analysis of a target company. The decision to
enter into a business combination, therefore, will likely be made without
detailed feasibility studies, independent analysis, market surveys or similar
information which, if the Company had more funds available to it, would be
desirable. The Company will be particularly dependent in making decisions upon
information provided by the principals and advisors associated with the business
entity seeking the Company's participation.
NO AGREEMENT FOR BUSINESS COMBINATION OR OTHER TRANSACTION--NO STANDARDS FOR
BUSINESS COMBINATION. The Company has no current arrangement, agreement or
understanding with respect to engaging in a business combination with a specific
entity. There can be no assurance that the Company will be successful in
identifying and evaluating suitable business opportunities or in concluding a
business combination. Management has not identified any particular industry or
specific business within an industry for evaluation by the Company. There is no
assurance that the Company will be able to negotiate a business combination on
terms favorable to the Company. The Company has not established a specific
length of operating history or a specified level of earnings, assets, net worth
or other criteria which it will require a target company to have achieved, or
without which the Company would not consider a business combination with such
business entity. Accordingly, the Company may enter into a business combination
with a business entity having no significant operating history, losses, limited
or no potential for immediate earnings, limited assets, negative net worth or
other negative characteristics.
CONTINUED MANAGEMENT CONTROL, LIMITED TIME AVAILABILITY. While seeking a
business combination, management anticipates devoting only a limited amount of
time per month to the business of the Company. The Company's officers have
not entered into a written employment agreement with the Company and they are
not expected to do so in the foreseeable future. The Company has not obtained
key man life insurance on its officers and directors.
CONFLICTS OF INTEREST--GENERAL. The Company's officers and directors participate
in other business ventures which may compete directly with the Company.
Additional conflicts of interest and non-arms length transactions may also arise
in the future. Management has adopted a policy that the Company will not seek a
business combination with any entity in which any member of management serves as
an officers, directors or partner, or in which they or their family members own
or hold any ownership interest. See "ITEM 5. DIRECTORS, EXECUTIVE OFFICERS,
PROMOTERS AND CONTROL PERSONS--Conflicts of Interest."
REPORTING REQUIREMENTS MAY DELAY OR PRECLUDE ACQUISITION. Section 13 of the
Securities Exchange Act of 1934 (the "Exchange Act") requires companies subject
thereto to provide certain information about significant acquisitions including
audited
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financial statements for the company acquired covering one or two years,
depending on the relative size of the acquisition. The time and additional costs
that may be incurred by some target companies to prepare such financial
statements may significantly delay or essentially preclude consummation of an
otherwise desirable acquisition by the Company. Acquisition prospects that do
not have or are unable to obtain the required audited statements may not be
appropriate for acquisition so long as the reporting requirements of the
Exchange Act are applicable.
LACK OF MARKET RESEARCH OR MARKETING ORGANIZATION. The Company has neither
conducted, nor have others made available to it, market research indicating that
demand exists for the transactions contemplated by the Company. Even in the
event demand exists for a transaction of the type contemplated by the Company,
there is no assurance the Company will be successful in completing any such
business combination.
LACK OF DIVERSIFICATION. The Company's proposed operations, even if successful,
will in all likelihood result in the Company engaging in a business combination
with only one target company. Consequently, the Company's activities will be
limited to those engaged in by the business entity which the Company merges with
or acquires. The Company's inability to diversify its activities into a number
of areas may subject the Company to economic fluctuations within a particular
business or industry and therefore increase the risks associated with the
Company's operations.
REGULATION UNDER INVESTMENT COMPANY ACT. Although the Company will be subject to
regulation under the Exchange Act, management believes the Company will not be
subject to regulation under the Investment Company Act of 1940, insofar as the
Company will not be engaged in the business of investing or trading in
securities. In the event the Company engages in business combinations which
result in the Company holding passive investment interests in a number of
entities, the Company could be subject to regulation under the Investment
Company Act of 1940. In such event, the Company would be required to register as
an investment company and could be expected to incur significant registration
and compliance costs. The Company has obtained no formal determination from the
Securities and Exchange Commission as to the status of the Company under the
Investment Company Act of 1940 and, consequently, any violation of such Act
could subject the Company to material adverse consequences.
PROBABLE CHANGE IN CONTROL AND MANAGEMENT. A business combination involving the
issuance of the Company's common stock will, in all likelihood, result in
shareholders of a target company obtaining a controlling interest in the
Company. Any such business combination may require shareholders of the Company
to sell or transfer all or a portion of the Company's common stock held by them.
The resulting change in control of the Company will likely result in removal of
the present officers and directors of the Company and a corresponding reduction
in or elimination of his participation in the future affairs of the Company.
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REDUCTION OF PERCENTAGE SHARE OWNERSHIP FOLLOWING BUSINESS COMBINATION of the
Company. The Company's primary plan of operation is based upon a business
combination with a business entity which, in all likelihood, will result in the
Company issuing securities to shareholders of such business entity. The issuance
of previously authorized and unissued common stock of the Company would result
in reduction in percentage of shares owned by the present shareholders of the
Company and would most likely result in a change in control or management.
TAXATION. Federal and state tax consequences will, in all likelihood, be major
considerations in any business combination the Company may undertake. Currently,
such transactions may be structured so as to result in tax-free treatment to
both companies, pursuant to various federal and state tax provisions. The
Company intends to structure any business combination so as to minimize the
federal and state tax consequences to both the Company and the target company;
however, there can be no assurance that such business combination 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 reorganization could result in the imposition of both federal and
state taxes which may have an adverse effect on both parties to the transaction.
POSSIBLE RELIANCE UPON UNAUDITED FINANCIAL STATEMENTS. The Company will require
Audited financial statements from any business entity that it proposes to
acquire. No assurance can be given, however, that audited financials will be
available to the Company prior to a business combination. In cases where audited
financials are unavailable, the Company will have to rely upon unaudited
information that has not been verified by outside auditors in making its
decision to engage in a transaction with the business entity. The lack of the
type of independent verification which audited financial statements would
provide increases the risk that the Company, in evaluating a transaction with
such a target company, will not have the benefit of full and accurate
information about the financial condition and operating history of the target
company. This risk increases the prospect that a business combination with such
a business entity might prove to be an unfavorable one for the Company.
COMPUTER SYSTEMS REDESIGNED FOR YEAR 2000. Many existing computer programs use
only two digits to identify a year in such programs date field. These programs
were designed and developed without consideration of the impact of the change in
the century for which four digits will be required to accurately report the
date. If not corrected, many computer applications could fail or create
erroneous results by or following the year 2000 ("Year 2000 Problem"). The
companies or governments operating such programs have not corrected many of the
computer programs containing such date language problems. It is impossible to
predict what computer programs will be effected, the impact any such computer
disruption will have on other industries or commerce or the severity or duration
of a computer disruption.
The Company does not have operations and does not maintain computer systems.
Before the Company enters into any business combination, it may inquire as to
the status of any target
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company's Year 2000 Problem, the steps such target company has taken or intends
to take to correct any such problem and the probable impact on such target
company of any computer disruption. However, there can be no assurance that the
Company will not enter into a business combination with a target company that
has an uncorrected Year 2000 Problem or that any planned Year 2000 Problem
corrections will be sufficient. The extent of the Year 2000 Problem of a target
company may be impossible to ascertain and any impact on the Company will likely
be impossible to predict.
ITEM 2. PLAN OF OPERATION
The Company intends to enter into a business combination with a target
company in exchange for the Company's securities. As of the initial filing date
of this Registration Statement, neither the Company's officers and directors nor
any affiliate has engaged in any negotiations with any representative of any
specific entity regarding the possibility of a business combination with the
Company.
Management anticipates seeking out a target company through solicitation.
Such solicitation may include newspaper or magazine advertisements, mailings and
other distributions to law firms, accounting firms, investment bankers,
financial advisors and similar persons, the use of one or more World Wide Web
sites and similar methods. No estimate can be made as to the number of persons
who will be contacted or solicited. Management may engage in such solicitation
directly or may employ one or more other entities to conduct or assist in such
solicitation. Management and its affiliates will pay referral fees to
consultants and others who refer target businesses for mergers into public
companies in which management and its affiliates have an interest. Payments are
made if a business combination occurs, and may consist of cash or a portion of
the stock in the Company retained by management and its affiliates, or both.
The Company has no full time employees. The Company's president has agreed
to allocate a portion of his time to the activities of the Company, without
compensation. The president anticipates that the business plan of the Company
can be implemented by his devoting no more than 10 hours per month to the
business affairs of the Company and, consequently, conflicts of interest may
arise with respect to the limited time commitment by
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such officers. Management is currently involved with other blank check
companies. A conflict may arise in the event that another blank check company
with which management is affiliated is formed and actively seeks a target
company. Management anticipates that target companies will be located for the
Company and other blank check companies in chronological order of the date of
formation of such blank check companies or, in the case of blank check companies
formed on the same date, alphabetically. However, other blank check companies
with which management is or may be affiliated may differ from the Company in
certain items such as place of incorporation, number of shares and shareholders,
working capital, types of authorized securities, or other items. It may be that
a target company may be more suitable for or may prefer a certain blank check
company formed after the Company. In such case, a business combination might
be negoiated on behalf of the more suitable or preferred blank check company
regardless of date of formation.
The Certificate of Incorporation of the Company provides that the Company
may indemnify officers and/or directors of the Company for liabilities, which
can include liabilities arising under the securities laws. Therefore, assets of
the Company could be used or attached to satisfy any liabilities subject to such
indemnification.
ies arising under the securities laws. Therefore, assets of
the Company could be used or attached to satisfy any liabilities subject to such
indemnification.
GENERAL BUSINESS PLAN
The Company's purpose is to seek, investigate and, if such investigation
warrants, acquire an interest in a business entity which desires to seek the
perceived advantages of a corporation which has a class of securities registered
under the Exchange Act. The Company will not restrict its search to any specific
business, industry, or geographical location and the Company may participate in
a business venture of virtually any kind or nature. Management anticipates that
it will be able to participate in only one potential business venture because
the Company has nominal assets and limited financial resources. See ITEM F/S,
"FINANCIAL STATEMENTS." This lack of diversification should be considered a
substantial risk to the shareholders of the Company because it will not permit
the Company to offset potential losses from one venture against gains from
another.
The Company may seek a business opportunity with entities which have
recently commenced operations, or which wish to utilize the public marketplace
in order to raise additional capital in order to expand into new products or
markets, to develop a new product or service, or for other corporate purposes.
The Company anticipates that the selection of a business opportunity in
which to participate will be complex and extremely risky. Management believes
(but has not conducted any research to confirm) that there are business entities
seeking the perceived benefits of a publicly registered corporation. Such
perceived benefits may include facilitating or improving the terms on which
additional equity financing may be sought, providing liquidity
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for incentive stock options or similar benefits to key employees, increasing the
opportunity to use securities for acquisitions, providing liquidity for
shareholders and other factors. Business opportunities may be available in many
different industries and at various stages of development, all of which will
make the task of comparative investigation and analysis of such business
opportunities difficult and complex.
The Company has, and will continue to have, no capital with which to
provide the owners of business entities with any cash or other assets. However,
management believes the Company will be able to offer owners of acquisition
candidates the opportunity to acquire a controlling ownership interest in a
public company without incurring the cost and time required to conduct an
initial public offering. Management has not conducted market research and is not
aware of statistical data to support the perceived benefits of a business
combination for the owners of a target company.
The analysis of new business opportunities will be undertaken by, or under
the supervision of, the officers and directors of the Company, who is not a
professional business analyst. In analyzing prospective business opportunities,
management may consider such matters as the available technical, financial and
managerial resources; working capital and other financial requirements; history
of operations, if any; prospects for the future; nature of present and expected
competition; the quality and experience of management services which may be
available and the depth of that management; the potential for further research,
development, or exploration; specific risk factors not now foreseeable but which
then may be anticipated to impact the proposed activities of the Company; the
potential for growth or expansion; the potential for profit; the perceived
public recognition or acceptance of products, services, or trades; name
identification; and other relevant factors. This discussion of the proposed
criteria is not meant to be restrictive of the Company's virtually unlimited
discretion to search for and enter into potential business opportunities.
The Exchange Act requires that any merger or acquisition candidate comply
with certain reporting requirements, which include providing audited financial
statements to be included in the reporting filings made under the Exchange Act.
The Company will not acquire or merge with any company for which audited
financial statements cannot be obtained at or within the required period of time
after closing of the proposed transaction.
The Company may enter into a business combination with a business entity
that desires to establish a public trading market for its shares. A target
company may attempt to avoid what it deems to be adverse consequences of
undertaking its own public offering by seeking a business combination with the
Company. Such consequences may include, but are not limited to, time delays of
the registration process, significant expenses to be incurred in such an
offering, loss of voting control to public shareholders or the inability to
obtain an underwriter or to obtain an underwriter on satisfactory terms.
The Company will not restrict its search for any specific kind of business
entities, but may acquire a venture which is in its preliminary or development
stage, which is already in
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operation, or in essentially any stage of its business life. It is impossible to
predict at this time the status of any business in which the Company may become
engaged, in that such business may need to seek additional capital, may desire
to have its shares publicly traded, or may seek other perceived advantages which
the Company may offer.
Management of the Company, which in all likelihood will not be experienced
in matters relating to the business of a target company, will rely upon its own
efforts in accomplishing the business purposes of the Company. Following a
business combination the Company may benefit from the services of others in
regard to accounting, legal services, and underwriting and corporate public
relations. If requested by a target company, management may recommend one or
more underwriters, financial advisors, accountants, public relations firms or
other consultants to provide such services.
A potential target company may have an agreement with a consultant or
advisor providing that services of the consultant or advisor be continued after
any business combination. Additionally, a target company may be presented to the
Company only on the condition that the services of a consultant or advisor be
continued after a merger or acquisition. Such preexisting agreements of target
companies for the continuation of the services of attorneys, accountants,
advisors or consultants could be a factor in the selection of a target company.
ACQUISITION OF OPPORTUNITIES
In implementing a structure for a particular business acquisition, the
Company may become a party to a merger, consolidation, reorganization, joint
venture, or licensing agreement with another corporation or entity. On the
consummation of a transaction, it is likely that the present management and
shareholders of the Company will no longer be in control of the Company. In
addition, it is likely that the Company's officers and directors will, as part
of the terms of the acquisition transaction, resign and be replaced by one or
more new officers and directors.
It is anticipated that any securities issued in any such reorganization
would be issued in reliance upon exemption from registration under applicable
federal and state securities laws. In some circumstances, however, as a
negotiated element of its transaction, the Company may agree to register all or
a part of such securities immediately after the transaction is consummated or at
specified times thereafter. If such registration occurs, it will be undertaken
by the surviving entity after the Company has entered into an agreement for a
business combination or has consummated a business combination and the Company
is no longer considered a blank check company. The issuance of additional
securities and their potential sale into any trading market which may develop in
the Company's securities may depress the market value of the Company's
securities in the future if such a market develops, of which there is no
assurance.
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While the terms of a business transaction to which the Company may be a
party cannot be predicted, it is expected that the parties to the business
transaction will desire to avoid the creation of a taxable event and thereby
structure the acquisition in a tax-free reorganization under Sections 351 or 368
of the Internal Revenue Code of 1986, as amended.
With respect to negotiations with a target company, management expects to
focus on the percentage of the Company which target company shareholders would
acquire in exchange for their shareholdings in the target company. Depending
upon, among other things, the target company's assets and liabilities, the
Company's shareholders will in all likelihood hold a substantially lesser
percentage ownership interest in the Company following any merger or
acquisition. The percentage of ownership may be subject to significant reduction
in the event the Company acquires a target company with substantial assets. Any
merger or acquisition effected by the Company can be expected to have a
significant dilutive effect on the percentage of shares held by the Company's
shareholders at such time.
The Company will participate in a business opportunity only after the
negotiation and execution of appropriate agreements. Although the terms of such
agreements cannot be predicted, generally such agreements will require certain
representations and warranties of the parties thereto, will specify certain
events of default, will detail the terms of closing and the conditions which
must be satisfied by the parties prior to and after such closing and will
include miscellaneous other terms.
The Company will not enter into a business combination with any entity
which cannot provide audited financial statements at or within the required
period of time after closing of the proposed transaction. The Company is subject
to all of the reporting requirements included in the Exchange Act. Included in
these requirements is the duty of the Company to file audited financial
statements as part of or within 60 days following the due date for filing its
Form 8-K which is required to be filed with the Securities and Exchange
Commission within 15 days following the completion of the business combination.
If such audited financial statements are not available at closing, or within
time parameters necessary to insure the Company's compliance with the
requirements of the Exchange Act, or if the audited financial statements
provided do not conform to the representations made by the target company, the
closing documents may provide that the proposed transaction will be voidable at
the discretion of the present management of the Company.
Management has orally agreed that it will advance to the Company any
additional funds which the Company needs for operating capital and for costs in
connection with searching for or completing an acquisition or merger. Such
advances will be made without expectation of repayment. There is no minimum or
maximum amount management will advance to the Company. The Company will not
borrow any funds to make any payments to the Company's management, its
affiliates or associates.
The Board of Directors has passed a resolution which contains a policy that
the Company will not seek a business combination with any entity in which the
Company's officers,
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directors, shareholders or any affiliate or associate serves as an officers or
directors or holds any ownership interest.
UNDERTAKINGS AND UNDERSTANDINGS REQUIRED OF TARGET COMPANIES As part of a
business combination agreement, the Company intends to obtain certain
representations and warranties from a target company as to its conduct following
the business combination. Such representations and warranties may include (i)
the agreement of the target company to make all necessary filings and to take
all other steps necessary to remain a reporting company under the Exchange Act
(ii) imposing certain restrictions on the timing and amount of the issuance of
additional free-trading stock, including stock registered on Form S-8 or issued
pursuant to Regulation S and (iii) giving assurances of ongoing compliance with
the Securities Act, the Exchange Act, the General Rules and Regulations of the
Securities and Exchange Commission, and other applicable laws, rules and
regulations.
A prospective target company should be aware that the market price and
volume of its securities, when and if listed for secondary trading, may depend
in great measure upon the willingness and efforts of successor management to
encourage interest in the Company within the United States financial community.
The Company does not have the market support of an underwriter that would
normally follow a public offering of its securities. Initial market makers are
likely to simply post bid and asked prices and are unlikely to take positions in
the Company's securities for their own account or customers without active
encouragement and a basis for doing so. In addition, certain market makers may
take short positions in the Company's securities, which may result in a
significant pressure on their market price. The Company may consider the ability
and commitment of a target company to actively encourage interest in its
securities following a business combination in deciding whether to enter into a
transaction with such company.
A business combination with the Company separates the process of becoming a
public company from the raising of investment capital. As a result, a business
combination with Company normally will not be a beneficial transaction for a
target company whose primary reason for becoming a public company is the
immediate infusion of capital. The Company may require assurances from the
target company that it has or that it has a reasonable belief that it will have
sufficient sources of capital to continue operations following the business
combination. However, it is possible that a target company may give such
assurances in error, or that the basis for such belief may change as a result of
circumstances beyond the control of the target company.
Prior to completion of a business combination, the Company will generally
require that it be provided with written materials regarding the target company
containing such items as a description of products, services and company
history; management resumes; financial information; available projections, with
related assumptions upon which they are based; an explanation of proprietary
products and services; evidence of existing patents, trademarks, or service
marks, or rights thereto; present and proposed forms of compensation to
management;
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a description of transactions between such company and its affiliates during
relevant periods; a description of present and required facilities; an analysis
of risks and competitive conditions; a financial plan of operation and estimated
capital requirements; audited financial statements, or if they are not
available, unaudited financial statements, together with reasonable assurances
that audited financial statements would be able to be produced within a
reasonable period of time not to exceed 75 days following completion of a
business combination; and other information deemed relevant.
COMPETITION
The Company will remain an insignificant participant among the firms which
engage in the acquisition of business opportunities. There are many established
venture capital and financial concerns which have significantly greater
financial and personnel resources and technical expertise than the Company. In
view of the Company's combined extremely limited financial resources and limited
management availability, the Company will continue to be at a significant
competitive disadvantage compared to the Company's competitors.
ITEM 3. DESCRIPTION OF PROPERTY
The Company has no properties and at this time has no agreements to acquire
any properties. The Company currently uses the offices of management at no cost
to the Company. Management has agreed to continue this arrangement until the
Company completes an acquisition or merger.
ITEM 4. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.
The following table sets forth each person known by the Company to be the
beneficial owner of five percent or more of the Company's Common Stock, all
directors individually and all directors and officers of the Company as a group.
Except as noted, each person has sole voting and investment power with respect
to the shares shown.
Amount and Nature
Name and Address of Beneficial
of Beneficial Owner Ownership (1) Percent of Class
Stuart Pudell 100,000 50%
393 Garden Street
East Meadow, NY 11554
Edward Toscano, Jr. 100,000 50%
120 Olive Street
Huntington, NY
ITEM 5. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS.
The Company has two Directors and two Officers as follows:
15
Name Age Position and Offices Held
- - ---- --- -------------------------
[S] [C] [C]
Edward Toscano, Jr. 33 President, Secretary, Director
Stuart Pudell 27 Vice President, Treasurer, Director
There are no agreements or understandings for the officers or directors to
resign at the request of another person and the above-named officers and
directors is not acting on behalf of nor will act at the direction of any other
person.
Set forth below is the name of the directors and officers of the Company,
all positions and offices with the Company held, the period during which he has
served as such, and the business experience during at least the last five years.
Stuart Pudell, age 27, holds a BS in Accounting from State University of New
York at Buffalo and a Juris Doctor from Hofstra University Law School. Mr.
Pudell practices law in Suffolk County, State of New York.
Mr. Toscano, age 33, holds a BA from State University of New
York at Stony Brook and a Juris Doctor from Touro Law School. Mr. Toscano
practices law in Suffolk County, State of New York.
CONFLICTS OF INTEREST
The Company's officers and directors expects to organize other companies of
a similar nature and with a similar purpose as the Company. Consequently, there
are potential inherent conflicts of interest in acting as an officers and
directors of the Company. Insofar as the officers and directors are engaged in
other business activities, management anticipates that it will devote only a
minor amount of time to the Company's affairs. The Company does not have a right
of first refusal pertaining to opportunities that come to management's attention
insofar as such opportunities may relate to the Company's proposed business
operations.
A conflict may arise in the event that another blank check company with
which management is affiliated is formed and actively seeks a target company. It
is anticipated that target companies will be located for the Company and other
blank check companies in chronological order of the date of formation of such
blank check companies or, in the case of blank check companies formed on the
same date, alphabetically. However, any blank check companies with which
management is, or may be, affiliated may differ from the Company in certain
items such as place of incorporation, number of shares and shareholders, working
capital, types of authorized securities, or other items. It may be that a target
company may be more suitable for or may prefer a certain blank check company
formed after the Company. In such case, a business combination might be
negotiated on behalf of the more suitable or preferred blank check company
regardless of date of formation.
Mr. Toscano and Mr. Pudell are officers and directors of other corprations.
As such, demands may be placed on their time which will detract from the amount
of time messrs., Toscano, and Pudell are able to devote to the Company.
16
<PAGE>
Messrs. Pudell and Toscano intend to devote as much time to the activities of
the Company as required. However, should such a conflict arise, there is no
assurance that Messrs., Pudell and Toscano would not attend to other matters
prior to those of the Company. Messrs., Pudell, & Toscano project that
initially up to ten hours per month of their time individually may be spent
locating a target company which amount of time would increase when the analysis
of, and negotiations and consummation with, a target company are conducted.
The terms of business combination may include such terms as Mr. Pudell and
Mr. Toscano remaining a director or officer of the Company. The terms of a
business combination may provide for a payment by cash or otherwise to Mr.
Pudell, and Mr. Toscano for the purchase or retirement of all or part of
their common stock of the Company by a target company or for services rendered
incident to or following a business combination. Mr. Pudell and Mr. Toscano
would directly benefit from such employment or payment. Such benefits may
influence Mr. Pudell, and Mr. Toscano 's choice of a target company.
The Company may agree to pay finder's fees, as appropriate and allowed, to
unaffiliated persons who may bring a target company to the Company where that
reference results in a business combination. No finder's fee of any kind will be
paid by the Company to management or promoters of the Company or to their
associates or affiliates. No loans of any type have, or will be, made by the
Company to management or promoters of the Company or to any of their associates
or affiliates.
The Company will not enter into a business combination, or acquire any
assets of any kind for its securities, in which management of the Company or any
affiliates or associates have any interest, direct or indirect.
There are no binding guidelines or procedures for resolving potential
conflicts of interest. Failure by management to resolve conflicts of interest in
favor of the Company could result in liability of management to the Company.
However, any attempt by shareholders to enforce a liability of management to the
Company would most likely be prohibitively expensive and time consuming.
INVESTMENT COMPANY ACT OF 1940
Although the Company will be subject to regulation under the Securities Act
of 1933 and the Securities Exchange Act of 1934, management believes the Company
will not be subject to regulation under the Investment Company Act of 1940
insofar as the Company will not be engaged in the business of investing or
trading in securities. In the event the Company engages in business combinations
which result in the Company holding passive investment interests in a number of
entities the Company could be subject to regulation under the Investment Company
Act of 1940. In such event, the Company would be required to register as an
investment company and could be expected to incur significant registration and
compliance costs. The Company has obtained no formal determination from the
Securities and Exchange Commission as to the status of the Company under the
Investment Company
17
<PAGE>
Act of 1940. Any violation of such Act would subject the Company to material
adverse consequences.
ITEM 6. EXECUTIVE COMPENSATION.
The Company's officers and directors do not receive any compensation for
their services rendered to the Company, have not received such compensation in
the past, and are not accruing any compensation pursuant to any agreement with
the Company. However, the officers and directors of the Company anticipate
receiving benefits as a beneficial shareholder of the Company and, possibly,
in other ways. See "ITEM 5. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL
PERSONS Conflicts of Interest".
No retirement, pension, profit sharing, stock option or insurance programs
or other similar programs have been adopted by the Company for the benefit of
its employees.
ITEM 7. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
The Company has issued a total of 200,000 shares of Common Stock to the
following persons for a total of $200 in cash:
<TABLE>
<CAPTION>
Name Number of Total Shares Consideration
- - ---- ---------------------- -------------
<S> <C> <C>
Edward Toscano, Jr. 100,000 Services
Stuart Pudell 100,000 Services
Edward Toscano, is the President, Secretary, and Director for the
Company. The total number of shares issued to Mr. Toscano, were in
exchange for services. Mr. Toscano, may receive additional shares in exchange
for cash and/or for services in lieu of cash although there is no current
agreement with the Company to do so.
Stuart Pudell, is the Vice-President, Treasurer, and Director for the
Company. The total number of shares issued to Mr. Pudell, were in
exchange for services. Mr. Pudell, may receive additional shares in exchange
for cash and/or for services in lieu of cash although there is no current
agreement with the Company to do so.
ITEM 8. DESCRIPTION OF SECURITIES.
The authorized capital stock of the Company consists of 10,000,000 shares
of Common Stock, par value $.01 per share. The following statements relating to
the capital stock set forth the material terms of the Company's securities;
however, reference is made to the more detailed provisions of, and such
statements are qualified in their entirety by reference to, the Certificate of
Incorporation and the By-laws, copies of which are filed as exhibits to this
registration statement.
COMMON STOCK
Holders of shares of common stock are entitled to one vote for each share
on all matters to be voted on by the stockholders. Holders of common stock do
not have cumulative voting rights. Holders of common stock are entitled to share
ratably in dividends, if any, as may be declared from time to time by the Board
of Directors in its discretion from funds legally
18
<PAGE>
available therefore. In the event of a liquidation, dissolution or winding up of
the Company, the holders of common stock are entitled to share pro rata all
assets remaining after payment in full of all liabilities. All of the
outstanding shares of common stock are fully paid and non-assessable.
Holders of common stock have no preemptive rights to purchase the Company's
common stock. There are no conversion or redemption rights or sinking fund
provisions with respect to the common stock.
DIVIDENDS
Dividends, if any, will be contingent upon the Company's revenues and
earnings, if any, capital requirements and financial conditions. The payment of
dividends, if any, will be within the discretion of the Company's Board of
Directors. The Company presently intends to retain all earnings, if any, for use
in its business operations and accordingly, the Board of Directors does not
anticipate declaring any dividends prior to a business combination.
TRADING OF SECURITIES IN SECONDARY MARKET
The National Securities Market Improvement Act of 1996 limited the
authority of states to impose restrictions upon sales of securities made
pursuant to Sections 4(1) and 4(3) of the Securities Act of companies which file
reports under Sections 13 or 15(d) of the Exchange Act. Upon effectiveness of
this Registration Statement, the Company will be required to, and will, file
reports under Section 13 of the Exchange Act. As a result, sales of the
Company's common stock in the secondary market by the holders thereof may then
be made pursuant to Section 4(1) of the Securities Act (sales other than by an
issuer, underwriter or broker).
Following a business combination, a target company will normally wish to
list the Company's common stock for trading in one or more United States
markets. The target company may elect to apply for such listing immediately
following the business combination or at some later time.
In order to qualify for listing on the NASDAQ SmallCap Market, a company
must have at least (i) net tangible assets of $4,000,000 or market
capitalization of $50,000,000 or net income for two of the last three years of
$750,000; (ii) public float of 1,000,000 shares with a market value of
$5,000,000; (iii) a bid price of $4.00; (iv) three market makers; (v) 300
shareholders and (vi) an operating history of one year or, if less than one
year, $50,000,000 in market capitalization. For continued listing on the NASDAQ
SmallCap Market, a company must have at least (i) net tangible assets of
$2,000,000 or market capitalization of $35,000,000 or net income for two of the
last three years of $500,000; (ii) a public float of 500,000 shares with a
market value of $1,000,000; (iii) a bid price of $1.00; (iv) two market makers;
and (v) 300 shareholders.
19
<PAGE>
If, after a business combination, the Company does not meet the
qualifications for listing on the NASDAQ SmallCap Market, the Company's may
apply for quotation of its securities on the NASD OTC Bulletin Board. In certain
cases the Company may elect to have its securities initially quoted in the "pink
sheets" published by the National Quotation Bureau, Inc.
TRANSFER AGENT
It is anticipated that the Company will act as it's own transfer agent for
the common stock of the Company.
GLOSSARY
</TABLE>
<TABLE>
<S> <C>
"Blank Check" Company As defined in Section 7(b)(3) of the
Securities Act, a "blank check" company
is a development stage company that has
no specific business plan or purpose or
has indicated that its business plan is
to engage in a merger or acquisition
with an unidentified company or
companies and is issuing "penny stock"
securities as defined in Rule 3a51-1 of
the Exchange Act.
Business Combination Normally a merger,
stock-for-stock exchange or
stock-for-assets exchange between the
Registrant and a target company.
The Company or the Registrant The corporation whose common stock is
the subject of this Registration
Statement.
Exchange Act The Securities Exchange Act of 1934, as
amended
"Penny Stock" Security As defined in Rule 3a51-1 of the
Exchange Act, a "penny stock" security
is any equity security other than a
security (i) that is a reported security
(ii) that is issued by an investment
company (iii) that is a put or call
issued by the Option Clearing
Corporation (iv) that has a price of
$5.00 or more (except for purposes of
Rule 419 of the Securities Act) (v) that
is registered on
</TABLE>
20
<PAGE>
<TABLE>
<S> <C>
a national securities exchange (vi) that
is authorized for quotation on the
NASDAQ Stock Market, unless other
provisions of Rule 3a51-1 are not
satisfied, or (vii) that is issued by an
issuer with (a) net tangible assets in
excess of $2,000,000, if in continuous
operation for more than three years or
$5,000,000 if in operation for less than
three years or (b) average revenue of at
least $6,000,000 for the last three
years.
Securities Act The Securities Act of 1933, as amended.
PART F/S
Financial Statements. The following financial statements are included in
this statement:
Report of Auditor
Balance Sheet as of September 30, 2000
Statements of Operations for the period from inception to
September 30, 2000
Statement of Stockholders' Equity from inception to September 30, 2000
Statements of Cash Flows for the period from inception to
September 30, 2000
Notes to Financial Statements
PART III
Items 1 and 2. Index to Exhibits and Description of Exhibits. The
following exhibits are included as part of this statement:
Exhibit No. Description
2.1 Certificate of Incorporation filed August 14, 2000
2.3 Current Bylaws
12.1 Consent of Auditor
THOMAS BAUMAN
CERTIFIED PUBLIC ACCOUNTANT
4 SCHAEFFER STREET
HUNTINGTON STATION, NY 17746
To the Board of Directors and Shareholders
LAST AMERICAN EXIT INC.
Huntington Village, NY
INDEPENDENT AUDITOR'S REPORT
I have audited the accompanying Balance Sheet of LAST AMERICAN EXIT, INC. (A
Development Stage Company), as of September 30, 2000
and the related statements of operations and accumulated deficit, changes in
stockholders' equity, and cash flows for the period August 14, 2000 (inception)
to September 30, 2000. These financial statements are the responsibility of the
Company's management. My responsibility is to express an opinion on these
financial statements based on my audit.
I conducted my audit in accordance with generally accepted auditing standards.
Those standards require that 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.
I believe that my audit provides a reasonable basis for my opinion.
In my opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of LAST AMERICAN EXIT, Inc. (A
Development Stage Company), as of September 30, 2000, and the results of its
operations and cash flows for the period September 30, 2000 (inception) to
September 30, 2000, in conformity with generally accepted accounting principles.
The accompanying financial statements have been prepared assuming the Company
will continue as a going concern. As shown in the financial statements, the
Company has incurred net losses since its inception. The Company's financial
position and operating results raise substantial doubt about its ability to
continue as a going concern. Management's plan in regard to these matters is
described in Note C. These financial statements do not include any adjustments
that might result from the outcome of this uncertainty.
/s/ Thomas Bauman
Thomas Bauman, C.P.A.
October 16, 2000
LAST AMERICAN EXIT INC.
(a development stage company)
BALANCE SHEET
September 30, 2000
ASSETS
CURRENT ASSETS
Cash $ 0
----------
TOTAL ASSETS $ 0
===========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accrued Expenses $ 0
----------
Total Liabilities $ 0
----------
STOCKHOLDERS' EQUITY
Common Stock 10,000,000 shares
authorized at $.01 par value;
200,000 shares issued and outstanding 2,000
Deficit accumulated during development stage (2,000)
----------
Total Stockholders' Equity $ 0
----------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 0
==========
See accompanying notes to financial statements
See Accountant's Audit Report
LAST AMERICAN EXIT INC.
(a development stage company)
STATEMENT OF OPERATIONS AND ACCUMULATED DEFICIT
For the Period August 14, 2000 (inception) to September 30, 2000
Revenue $ -0-
Operating expenses
Gewneral and Administrative 2,000
----------
Loss before income taxes (2,000)
Income taxes -0-
----------
Deficit accumulated during the
development stage-September 30, 2000 (2,000)
==========
Net loss per share (.01)
See accompanying notes to financial statements
See Accountant's Audit Report
<PAGE>
LAST AMERICAN EXIT INC.
(a development stage company)
Statement of Changes in Stockholders' Equity
For the Period August 14, 2000 (inception) to September 30, 2000
Common Accumulated Number of
Stock Deficit Shares
Issuance of Common Stock $ 2,000 200,000
August 14, 2000
Net Loss $(2,000)
------- ------- --------
Totals $ 2,000 $(2,000) 200,000
======= ======= ========
See accompanying notes to financial statements
See Accountant's Audit Report
<PAGE>
LAST AMERICAN EXIT INC.
(a development stage company)
STATEMENT OF CASH FLOWS
For the Period August 14, 2000 (inception) to September 30, 2000
CASH FLOWS FROM OPERATING ACTIVITIES
Net Income (Loss) $ (2,000)
Adjustments to reconcile net loss to net
cash provided by operating activities
Increase in:
Accrued Expenses (2,000)
---------
Net Cash Provided By Operating Activities 2,000
---------
Cash Flows from Financing Activities
Issuance of Common Stock for Cash 2,000
---------
Net Cash Provided by Financing Activities 2,000
---------
Net Increase in Cash -0-
Cash at Beginning of Period -0-
---------
Cash at End of Period -0-
=========
See accompanying notes to financial statements
See Accountant's Audit Report
LAST AMERICAN EXIT INC.
NOTES TO FINANCIAL STATEMENTS
September 30, 2000
Note A- Summary of Significant Accounting Policies
Organization
LAST AMERICAN EXIT, INC. (a development stage company) is a New York Corporation
incorporated on August 14, 2000.
The company conducts no business from its headquarters in Huntington Village,
New York. The company has not yet engaged in its expected operations. The
future operations will be to merge with or acquire an existing company.
The company is in the development stage and has not yet acquired the necessary
operating assets, nor has it begun any part of its proposed business. While the
Company is negotiating with the prospective personnel and potential customer
distribution channels, there is no assurance that any benefit will result from
such activities. The Company will not receive any operating revenues until the
commencement of operations, but will continue to incur expenses until then.
Accounting Method
The Company financial statements are prepared using the accrual method of
accounting. The Company has elected a December 31st year-end.
Start-Up Costs
Statement of Position 98-5 ("SOP 98-5"), "Reporting on the Costs of Start-Up
Activities" provides guidance on the financial reporting of start-up costs and
organization costs. It requires most costs of start-up activities and
organization costs to be expended as occurred. SOP 98-5 is effective for fiscal
years beginning after December 15,1998. With the adoption of SOP 98-5, there
has been little or no effect on the company's financial statements.
Loss Per Share
Net loss per share is provided in accordance with Statement of Financial
Accounting Standards No. 128 (SFAS #128) "Earnings per Share". Basic loss per
share is computed by dividing losses available to common shareholders by the
weighted average number of common shares outstanding during the period. Diluted
loss per share reflects per share amounts that would have resulted if dilutive
common stack equivalents had been converted to common stock. As of September
30, 2000, the Company had no dilutive common stock equivalents such as stock
options.
Policy in Regards to Issuance of Common Stock in a Non-Cash Transfer.
The Company's accounting policy for issuing shares in a non-cash transaction is
to issue the equivalent amount of stick equal to the fair market value if the
asserts or services received.
Use of Estimates
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect certain reported amounts and disclosures. Accordingly, the actual
results could differ from those estimates.
Income Taxes
Income taxes are provided for using the liability method of accounting in
accordance with Statement of Financial Accounting Standards No. 109 (SFAS #109)
"Accounting for Income Taxes." A deferred tax asset or liability is recorded
for all temporary difference between financial and tax reporting. Deferred tax
expense (benefit) results from the net change during the year of deferred tax
assets and liabilities.
NOTE B - Stockholder's Equity
The Company has authorized 10,000,000 shares of .01 par value common stock. On
August 14, 2000, the Company authorized and issued 200,000 shares of common
stock to two shareholders for services rendered. The services amounted to
$2,000 in aggregate at September 30, 2000.
NOTE C- Going Concern
As shown in the accompanying financial statements, the company incurred a net
loss of $2,000 from August 14, 2000 (date of inception) through September 30,
2000. The ability of the Company to continue as a going concern is dependent
upon commencing operations and obtaining additional capital and financing. The
financial statements do not include any adjustments that might be necessary if
the Company is unable to continue as going concern. The Company is currently
seeking a merger partner or an acquisition candidate to allow it to begin it
planned operations.
NOTE D - Income Taxes
There is no provision for income taxes for the period ended September 30, 2000,
due to the net loss.
The Company's total deferred tax asset as of September 30, 2000 is as follows:
Net operation loss carry forward $ 0
Valuation allowance $ 0
------------
Net deferred tax asset $ 0
============
NOTE E - RELATED PARTY TRANSACTIONS
The Company neither owns nor leases any real or personal property. An officer
of the corporation provides office services without charge. Such costs are
immaterial to the financial statements and accordingly, have not been
reflected therein. The officers and directors of the Company are involved in
other business opportunities. If a specific business opportunity becomes
available, such persons may face a conflict in selecting between the Company
and their other business interests. The Company has not formulated a policy
for the resolution of such conflicts.
EXHIBIT 2.1
CERTIFICATE OF INCORPORATION
OF
LAST AMERICAN EXIT INC.
Pursuant to Section 402 of the Business and Corporation Law
I, the undersigned, a natural person of at least 18 years of age, for the
purpose of forming a corporation under Section 402 of the Business and
Corporation Law of the State of New York hereby certify:
FIRST: The name of the corporation is:
LAST AMERICAN EXIT INC.
SECOND: The purpose for which the Corporation is formed is to engage in any
lawful act or activity for which corporations may be organized under Article
IV of the Business Corporation Law, except that it is not formed to engage in
any act or activity requiring the consent or approval of any state official,
department, board, agency or other body without such consent or approval
first being obtained.
THIRD: The office of the Corporation shall be located in the County of SUFFOLK,
State of New York.
FOURTH: The aggregate number of shares which the Corporation shall have
authority to issue is TEN MILLION, each of which shall be common stock with a
par value of $.01.
FIFTH: The Secretary of State is designated as the agent of the corporation upon
whom process against it may be served. The post office address to which the
Secretary of State shall mail a copy of any process against the Corporation
served upon him is:
C/O TOSCANO & PUDELL
339 NEW YORK AVENUE
HUNTINGTON VILLAGE, NY 11743
SIXTH: No director of the corporation shall be personally liable to the
corporation or its shareholders for damages for any breach of duty in such
capacity, provided, however, that the provision shall not eliminate or limit:
(a) the liability of any director of the corporation if a judgment or other
final adjudication adverse to him establishes that his acts or omissions were in
bad faith or involved intentional misconduct or a knowing violation of the law
or that he personally gained in fact a financial profit or other advantage to
which he was not legally entitled or, with respect to any director of the
corporation, that his acts violated Section 719 of the New York Business
Corporation Law of the State of New York.
(b) The liability of the director for act or omission prior to final adoption of
this article.
SEVENTH: The holders of any of the corporation's equity share shall be entitled
preemptive rights in accordance with the provisions of BCL section 622.
IN WITNESS WHEREOF, the undersigned incorporator has executed this certificate
of incorporation.
s/ Sharon Babala
-------------------------
Sharon Babala, Incorporator
Blumberg Excelsior Corporate
Services, Inc.
488 Broadway
Albany, New York 12207
<PAGE>
EXHIBIT 2.3
BY-LAWS
OF
LAST AMERICAN EXIT INC.
Incorporated Under the Business Corporation Law of the State of New York
1. PRINCIPAL OFFICE
(1.1) Initial Location. The principal office of the corporation shall initially
be located at:
339 New York Avenue
Huntington Village, NY 11743
(1.2) Change of Location. The Board of Directors may, upon reasonable written
notice to all shareholders, relocate the principal office of the Corporation.
(1.3) Other Offices. In addition to its principal office, the corporation may
have such other offices, either within or without the state of incorporation, as
the Board of Directors may designate.
2. DIRECTORS
(2.1) Number. The number of directors shall be that number as may from time to
time be fixed by the Board of Directors, but not less than the minimum number
required by law.
(2.2) Qualification. No person shall serve as a director unless such person is
at least 18 years of age.
(2.3) Notices. Upon taking office, each director shall file with the secretary
a written designation of the address that the director desires to be used for
the purpose of giving notices to him/her. Until the director shall have
effectively done so, he/she shall be deemed to have designated either the
principal office of the corporation or any other address that the sender of the
notice could reasonably believe to be an appropriate address. Any designated
address may be redesignated by similar filing with the secretary. The secretary
shall give each of the other directors prompt notice of every designation or
re-designation filed. The designation or re-designation shall be effective
three business days after the secretary's action or upon earlier receipt. Any
notice to a director shall be valid if sent to either (a) the director's
designated address or (b) any other address used in good faith unless it be
shown that prejudice resulted from use of such other address. All notices must
be in writing. Any notice may be delivered by hand or sent by telecommunictions
device, by mail or by similar means. If a notice is sent by registered mail or
return receipt requested, another copy shall at the same time, be sent by
ordinary first class mail.
(2.4) Resignation. A director may resign at any time by giving notice to each
of the other directors. Unless otherwise specified, the notice shall be
effective immediately and acceptance shall not be necessary to make it
effective. A director need not assign cause for resigning.
(2.5) Removal. A director may be removed by the shareholders without cause or
by the Board of Directors with; cause.
3. BOARD OF DIRECTORS
(3.1) Regular Meetings. A regular meeting shall be held immediately after and
at the same place as the annual meeting of shareholders. The Board of Directors
may provide for other regular meetings. Notice need not be given of any regular
meeting.
(3.2) Special Meetings. The president or any two directors may call a special
meeting upon not less than five business days notice to every director of the
time and place of the special meeting. The special meeting notice does not have
to specify the business to be transacted.
(3.3) Adjourned Meetings. Whether or not a quorum is present, a majority of the
directors present may adjourn any meeting to such time and place as they shall
decide. Notice of any adjourned meeting need not be given. At any adjourned
meeting, whether adjourned once or more, any business may be transacted that
might have been transacted at the meeting of which it is an adjournment.
Additional business may also be transacted if proper notice shall have been
given.
(3.4) Organization. The chairperson of the meeting shall be the president if
taking part in the meeting or, if not, any director elected by a majority of the
directors present, The secretary of the meeting shall be the secretary if
taking part in the meeting or, if not, any director appointed by the chairman of
the meeting.
(3.5) Committees. The board of Directors may, by resolution passed by a
majority of the full Board of Directors (a) designate two or more of its number
to constitute an executive committee, or one or more other committees, which, so
far as may be permitted by law and to the extent and in that manner provided in
said resolution, shall have and may exercise, between meetings of the Board of
Directors, the powers of the board of directors in the management of the affairs
and business of the corporation, (b) at any time change the members of any such
committees, (c) fill vacancies in any such committee, and (d) discharge any
such committee, with or without cause. The Board of Directors may provide for
regular meetings of any such committee with or without notice as the Board of
Directors may prescribe. To the extent the authority of the Board of Directors
has been delegated to any such committee, any reference in these by-laws to the
Board of Directors shall be deemed a reference to such committee.
(3.6) Telecommunications Participation. Any one or more directors may
participate in a meeting of the Board or any committee by means of a conference
telephone or other type of telecommunications equipment allowing persons
participating in the meeting to hear each other at the same time.
(3.7) Regulations. The Board of Directors may adopt rules and regulations, not
inconsistent with law, the certificate of incorporation or these by-laws, for
the conduct of its meetings and the management of all aspects of the affairs of
the corporation.
4. SHARES AND CERTIFICATES
(4.1) Form of Certificates. Certificates representing shares shall be in the
form determined by the Board of Directors. All certificates issued shall be
consecutively numbered or otherwise appropriately identified.
(4.2) Share Transfer Ledger. There shall be kept a share transfer ledger in
which shall be entered full and accurate records including the names and
addresses of all shareholders, the number of shares issued to each shareholder
and the dates of issuance. All transfers of shares shall be promptly reflected
in the share transfer ledger. Unless otherwise directed by the Board of
Directors, the share transfer ledger shall be kept at the principal office of
the corporation.
(4.3) Transfer of Shares. Upon (a) receipt of the certificate representing
the shares to be transferred, either duly endorsed or accompanied by proper
evidence of succession assignment or authority to transfer, (b) payment of any
required transfer taxes, and (c) payment of any reasonable charge the Board of
Directors may have established, the surrendered certificate shall be canceled
and a new certificate or certificates shall be issued to the person(s) entitled
to it.
(4.4) Replacement Certificates. Replacement certificates will be issued at the
request of the shareholder upon payment of any reasonable charge the Board of
Directors may have established. In case of a lost, mislaid, destroyed or
mutilated certificate, proof of the facts, by affidavit or otherwise, may also
be required, as may be a bond or other proper indemnification for the
corporation and its agents.
(4.5) Record Owner to be Treated as Owner. Unless otherwise directed by a
court of competent jurisdiction the corporation shall treat the holder of
record of any share as the holder in fact and accordingly shall not recognize
any equitable or other claim to or interest in the shares on the part of any
other persons, whether or not it shall have express or other notice of it.
5. SHAREHOLDER'S MEETINGS
(5.1) Annual Meeting. The annual meeting of the shareholders shall be held on
the 14th day of the month of in each year at the principal office of the
corporation. If the day fixed for the annual meeting is a Saturday, Sunday or
holiday at the place it is to be held, the meeting shall be held on the
following day that is not such a day. Unless otherwise stated in the notice
of meeting pursuant to direction of the Board of Directors, the annual meeting
shall be held at the principal office of the corporation.
(5.2) Special Meetings. A special meeting of the shareholders may be called by
the Chairman, the Board of Directors, President, the chief executive officer, or
the holders of not less than one-tenth of all the shares entitled to vote at the
meeting.
(5.3) Adjourned Meetings. Whether or not a quorum is present, a majority in
voting power of the shareholders present in person or by proxy and entitled to
vote may adjourn any meeting to a time and place as they shall decide. Notice
of any adjourned meeting need not be given. At any adjourned meeting, whether
adjourned once or more, any business may be transacted that might have been
transacted at the meeting of which it is an adjournment. Additional business
may also be transacted if proper notice shall have been given.
(5.4) Organization. The president shall be chairman of the meeting. The
secretary shall be secretary of the meeting. If neither the president nor any
vice president is present, the shareholders shall choose a chairman of the
meeting. If neither the secretary nor any assistant secretary is present, the
chairman of the meeting shall appoint a secretary of the meeting.
(5.5) Order of Business. The order of business shall be as determined by the
chairman of the meeting, but the order may be changed by a majority in voting
power of the shareholders present in person or by proxy and entitled to vote.
Unless otherwise determined as aforesaid, the order shall be as follows:
1. Roll call
2. Proof of notice of meeting or waiver of notice
3. Reading of minutes of preceding meeting
4. Reports of officers
5. Reports of committees.
6. Election of directors
7. Unfinished business
8. New business
(5.6) Voting. Upon demand of any shareholders, voting shall be by ballot, in
which event each ballot shall be signed by the shareholder or his proxy and
shall state the number shares voted. Otherwise, voting need not be in writing.
6. OFFICERS
(6.1) Additional Officers. In additional to the president, secretary, treasurer
and any other offices required by law, the corporation may have one or more vice
presidents elected by the Board of Directors, one of whom may be designated as
executive vice president. The corporation may also have such other or assistant
officers as may be elected by, or appointed in a manner prescribed by, the Board
of Directors.
(6.2) Seniority. The executive vice president, if there is one, shall be deemed
senior to all other vice presidents. Unless otherwise determined by, or under
rules prescribed by, the Board of Directors, seniority of any officer shall be
determined by length of continuous service in that office.
(6.3) Continuation in Office. Unless otherwise provided by the Board of
Directors, every officer shall serve until death, incapacity, resignation or
removal by the Board of Directors. Any resignation or removal shall be without
prejudice to any contractual rights of the corporation or the officer.
(6.4) Duties in General. Subject to these by-laws, the authority and duties of
all offices shall be determined by, or in the manner prescribed by, the Board of
Directors. Except as may be specifically restricted by the Board of Directors,
any officer may delegate any of his/her authority and duties to any subordinate
officer.
(6.5) Duties of the President. The president shall be the principal executive
officer of the corporation and, subject to the control of the Board of
Directors, shall in general supervise and control all of the business and
affairs of the corporation. The president may sign, with the secretary or any
other proper officer of the corporation thereunto authorized by the Board of
Directors, certificates for shares of the corporation, any deeds, mortgages,
bonds, contracts, or other instruments that the Board of Directors has
authorized to be executed, except where the signing and execution shall be
expressly delegated by the Board of Directors or by these by-laws to some other
officer or agent of the corporation or shall be required by law to otherwise
signed or executed, and in general shall perform all duties incident to the
office of the president and such their duties as may be prescribed by the Board
of Directors from time to time.
(6.6) Duties of Vice Presidents. In the absence or incapacity of the president,
the senior vice president shall perform the duties of the president and, when so
acting, shall have all the powers of and be subject to all the restrictions upon
the president. Each vice president shall perform any other duties as may be
assigned by the president or by the Board of Directors.
(6.7) Duties of Secretary. The secretary shall keep the minutes of the
shareholders' and the directors' meetings in one or more books provided for that
purpose, see that al notices are duly given in accordance with the provisions of
these by-laws or as otherwise required, be custodian of the corporate records
and of the seal of the corporation, keep a register of the post office addresses
of each shareholder, have general charge of the share transfer books of the
corporation, and in general perform all duties incident to the office of
secretary and other duties that may be assigned by the president from time to
time.
(6.8) Duties of Treasurer. If required by the Board of Directors, the treasurer
shall give a bond for the faithful discharge of his/her duties in a sum and with
any surety or sureties as the Board of Directors shall determine. The treasurer
shall have charge and custody of and be responsible for all funds and securities
of the corporation, receive and give receipts for monies due and payable to the
corporation from any source whatsoever, and deposit all such monies in the name
of the corporation in the banks, trust companies or other depositories as shall
be selected in accordance with these by-laws, and in general perform all
duties incident to the office of treasurer and such other duties as may be
assigned by the president or the Board of Directors.
(6.9) Salaries. No officer shall receive any salary unless provided or
authorized by the Board of Directors. No officer shall be prevented from
receiving a salary by reason of the fact that he/she is a director.
7. SEAL
(7.1) Form. The seal of the corporation
shall be in the form impressed in the margin.
(7.2) Use. The seal may be used by causing it to be impressed directly on the
instrument or writing to be sealed, or upon an adhesive substance annexed. The
seal on certificates for shares or other documents may be a facsimile, engraved
or imprinted.
8. AMENDMENTS
(8.1) By Board. These by-laws may be amended or replaced by the Board of
Directors.
CERTIFICATE OF ADOPTION OF BYLAWS
ADOPTION BY INCORPORATOR(S) OR FIRST DIRECTOR(S)
The undersigned person(s) appointed in the Articles of Incorporation to act as
the Incorporator(s) or First Director(s) of the above-named corporation hereby
adopt the same as the Bylaws of said corporation.
Executed this 14th day of August, 2000.
/s/ Edward Toscano
Signature
Edward Toscano
Print Name
THIS IS TO CERTIFY:
That I am the duly-elected, qualified and acting Secretary of the
above-named corporation; that the foregoing Bylaws were adopted as the Bylaws of
said corporation on the date set forth above by the person(s) appointed in the
Articles of Incorporation to act as the Incorporator(s) or First Directors(s) of
said corporation.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the
corporate seal this 14th day of August, 2000.
/s/Edward Toscano
Secretary
(SEAL)
CERTIFICATE BY SECRETARY OF ADOPTION BY SHAREHOLDERS' VOTE.
THIS IS TO CERTIFY:
That I am the duly elected, qualified and acting Secretary of the
above-named corporation and that the above and foregoing Code of Bylaws was
submitted to the shareholders at their first meeting held on the date set forth
in the Bylaws and recorded in the minutes thereof, was ratified by the vote of
shareholders entitled to exercise the majority of the voting power of said
corporation.
IN WITNESS WHEREOF, I have hereunto set my hand this 14th day of August, 2000.
/s/ Edward Toscano
Secretary
EXHIBIT 12.1
THOMAS BAUMAN
CERTIFIED PUBLIC ACCOUNTANT
4 SCHAEFFER STREET
HUNTINGTON STATION, NY 17746
CONSENT FOR INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
We hereby consent to the incorporation by reference in this Registration
Statement on Form 10-SB of our report dated October 16, 2000 of LAST AMERICAN EXIT INC., for the period ended September 30, 2000.
/s/ Thomas Bauman
Thomas Bauman, C.P.A.
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