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
WOODRIDGE CAPITAL CORP.
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(Name of Small Business Issuer)
Delaware 98-0336407
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(State or Other Jurisdiction of I.R.S. Employer
Identification Number
Incorporation or Organization)
Colin Watt
1360 - 605 Robson Street, Vancouver BC Canada V6B 5J3
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(Address of Principal Executive Offices including Zip Code)
(604) 684-6535
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(Issuer's Telephone Number)
Securities to be Registered Under Section 12(b) of the Act: None
Securities to be Registered Under Section 12(g) of the Act:
Common Stock, $.0001 Par Value
(Title of Class)
TABLE OF CONTENTS
PART 1
ITEM 1. DESCRIPTION OF BUSINESS 1
History and Organization 2
Proposed Business 2
Risk Factors 3
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS
OR PLAN OF OPERATION 10
General Business Plan 10
Structure of Acquisition 13
No Dividend 14
Employees 14-15
Competition 15
Liquidity and Capital Resources 15
ITEM 3. DESCRIPTION OF PROPERTY 15
ITEM 4. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT 16
ITEM 5. DIRECTORS AND EXECUTIVE OFFICERS, PROMOTER
AND CONTROL PERSONS 16
ITEM 6. EXECUTIVE COMPENSATION 17
ITEM 7. CERTAIN RELATIONSHIPS AND RELATED
TRANSACTIONS 17
ITEM 8. DESCRIPTION OF SECURITIES 18
PART II
ITEM 1. MARKET PRICE OF AND DIVIDENDS ON REGISTRANT'S
COMMON EQUITY AND RELATED STOCKHOLDER
MATTERS 19
ITEM 2. LEGAL PROCEEDINGS 20
ITEM 3. CHANGES IN AND DISAGREEMENTS WITH
ACCOUNTANTS 20
ITEM 4. RECENT SALES OF UNREGISTERED
SECURITIES 20
ITEM 5. INDEMNIFICATION OF DIRECTORS AND
OFFICERS 21
PART F/S
FINANCIAL STATEMENTS 21
PART III
ITEMS 1&2 INDEX TO AND DESCRIPTION OF
EXHIBITS 28-30
PART I
ITEM 1. DESCRIPTION OF BUSINESS.
History And Organization
Woodridge Capital Corp. (the "Company") was organized under the
laws of the State of Delaware on October 18, 2000. The Company was
organized for the purposes of creating a corporate vehicle to locate and
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acquire an operating business entity which management believes is a
suitable acquisition candidate (a "target company").
The Company will not restrict its search for a target company to
any specific business, industry or geographical location. The Company
does not currently engage in any business activities that provide any cash
flow. The costs of identifying, investigating, and analysing business
combinations will be paid with money in the Company's treasury or
loaned by management.
Although the Company was under no obligation to do so, it has
voluntarily filed this registration statement because it believes that it can
better facilitate its business goals if it were a "reporting issuer" under
the Securities Exchange Act of 1934 (the "Exchange Act").
The Company may be characterized as a "blind pool" or "blank
check" company.
Proposed Business
The Company will seek to locate and acquire a target company
which in the opinion of the Company's management (sometimes referred
to as the "Management") offers long term growth potential. The Company
will not restrict its search to any specific business, industry or
geographical location. The Company may seek to acquire a target
company which has just commenced operations, or which wishes to avail
itself of the benefits of being a "reporting issuer" in order to facilitate
capital formation to expand into new products or markets.
There are certain perceived benefits to being a "reporting issuer"
with a class of publicly-traded securities. These are commonly thought
to include the following:
* 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;
* greater ease in subsequently raising capital;
* compensation of key employees through stock options;
* enhanced corporate image;
* a presence in the United States capital market.
On the other hand there are a number of disadvantages to being a
reporting issuer including:
* significant additional expenses are incurred in order to comply with
all the regulatory requirements that apply to reporting issuers;
* the company's annual financial statements have to be audited under
US GAAP and quarterly financial statements need to be prepared;
* the financial and business affairs of the company are made public;
* a reporting issuer is subject to insider trading reporting and liability
provisions; and
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* a reporting issuer can be subject to class action suits.
A target company, 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 obtain investment
capital on more favourable 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; and
* a company seeking one or more of the other perceived benefits of
becoming a public company.
In certain cases a company may find a business combination less
attractive than an initial public offering of their securities. Usually a
business combination is dilutive to the shareholders of the company
seeking to go public without the benefits of an infusion of capital.
Furthermore some companies for reasons of potential undisclosed
liabilities do not like the idea of merging with another company.
There are no assurances that the Company will be able to effect an
acquisition of a target company. In addition, at this time, no details can
be provided as to an acquisition or as to the nature of the target
company.
Risk Factors
The Company's business is subject to numerous risk factors,
including the following:
Anticipated Change in Control and Management.
Upon the successful completion of the acquisition of a target
company, the Company anticipates that it will have to issue to the target
company or its shareholders some authorized but unissued common stock
which, when issued will comprise a majority of the Company's then
issued and outstanding shares of common stock. Therefore, the Company
anticipates that upon the closing of the acquisition of a target company,
the Company will no longer be controlled by the current shareholders. In
addition, existing management and directors may resign. The Company
cannot give any assurance that the experience or qualifications of new
management, as it relates to either the operation of the Company's
activities or to the operation of the business, assets or property being
acquired, will be adequate for such purposes.
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Conflict of Interest - Management's Fiduciary Duties.
A conflict of interest may arise between Management's personal
financial benefit and management's fiduciary duty to shareholders.
The Company's sole director and officer, is or may become, in his
individual capacity, officer, director, controlling shareholder and/or
partner of other entities engaged in a variety of businesses. Mr.
Watt, the sole director and officer of the Company, is engaged in
other business activities. Accordingly, the amount of time he will devote
to the Company's business will only be about 5 to 10 hours per month.
There exists potential conflicts of interest including allocation of time
between the Company and its representative's other business interests.
Experience of Management; Consultants.
Although Management has general business experience, it has
limited experience in effecting business combinations and may not have
any significant experience in acquiring or operating certain business
interests that the Company might choose to acquire. Management does
not have, nor does it presently intend to enter into, any contracts or
agreements with any consultants or advisors with respect to its proposed
business activities. Consequently, Management has not established the
criteria that will be used to hire independent consultants regarding their
experience, the services to be provided, the term of service, etc., and no
assurance can be made that the Company will be able to obtain such
assistance on acceptable terms.
Potential Future Rule 144 Sales.
Of the 1,000,000 shares of the Company's Common Stock
authorized, there are presently 725,000 shares issued and outstanding; all
are `restricted securities' as that term is defined under the Securities Act
of 1933, as amended (the "Securities Act"), and in the future may be sold
in compliance with Rule 144 of the Act, or pursuant to a Registration
Statement filed under the Act. Rule 144 provides, in essence, that a
person holding restricted securities for a period of 1 year may sell those
securities in unsolicited brokerage transactions or in transactions with a
market maker, in an amount equal to 1% of the Company outstanding
common stock every 3 months. Additionally, Rule 144 requires that an
issuer of securities make available adequate current public information
with respect to the issuer. Such information deemed available if the
issuer satisfies the reporting requirements of Sections 13 or 15(d) of the
Exchange Act and of Rule 15c2-11 thereunder. Rule 144 also permits,
under certain circumstances, a sale of shares by a person who is not an
affiliate of the Company's and who has satisfied a 2 year holding period
without any quantity limitation and whether or not there is adequate
current public information available. Investors should be aware that
sales under Rule 144, or pursuant to a registration statement filed under
the Securities Act, may have a depressive effect on the market price of
the Company's common stock in any market that may develop for such
shares.
Possible Issuance of Additional Shares.
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The Company's Certificate of Incorporation, authorizes the issuance
of 1,000,000 shares of common stock. The Company's Board of Directors
has the power to issue any or all of such additional shares without
stockholder approval for such consideration as it determines.
Management presently anticipates that it may choose to issue a
substantial but as yet undetermined amount of the Company's shares in
connection with the acquisition of a target business.
Risks of Leverage.
There are currently no limitations relating to the Company's ability
to borrow funds to increase the amount of capital available to it to effect
a business combination or otherwise finance the operations of any
acquired business. The amount and nature of any borrowings by the
Company will depend on numerous factors, including the Company's
capital requirements, the Company's perceived ability to meet debt
services on any such borrowings, and then-prevailing conditions in the
financial markets as well as general economic conditions. There can be
no assurance that debt financing, if required or otherwise sought, will be
available on terms deemed to be commercially acceptable and in the best
interest of the Company. The Company's inability to borrow funds
required to effect or facilitate a business combination, or to provide
funds for an additional infusion of capital into an acquired business, may
have a material adverse affect on the Company's financial condition and
future prospects.
Additionally, to the extent that debt financing ultimately proves to
be available, any borrowings may subject the Company to various risks
traditionally associated with incurring of indebtedness, including:
* if the Company's operating revenues after the acquisition were to be
insufficient to pay debt service, there would be a risk of default
and foreclosure on the Company's assets.
* if a loan agreement containing covenants is breached without a
waiver or renegotiation of the terms of that covenant, then the
lender could have the right to accelerate the payment of the
indebtedness even if the Company has made all principal and
interest payments when due.
* if the interest rate on a loan fluctuated or the loan was payable on
demand, the Company would bear the risk of variations in the
interest rate or demand for payment.
* if the terms of a loan did not provide for amortization prior to
maturity of the full amount borrowed and the 'balloon' payment
could not be refinanced at maturity on acceptable terms, the
Company might be required to seek additional financing and, to the
extent that additional financing is not available on acceptable
terms, to liquidate the Company's assets.
Possible Need for Additional Financing.
The Company cannot ascertain with any degree of certainty the
capital requirements for a particular acquired business inasmuch as the
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Company has not yet identified any acquisition candidates. If the target
company requires additional financing, such additional financing (which,
among other forms, could be derived from the public or private offering
of securities or from the acquisition of debt through conventional bank
financing), may not be available, due to, among other things, the target
company not having sufficient:
* credit or operating history;
* income stream;
* profit level;
* asset base eligible to be collateralized; or
* market for its securities.
Since no specific business has been targeted for acquisition, it is
not possible to predict the specific reasons why conventional private or
public financing or conventional bank financing might not become
available. Although there are no agreements between the Company and
any of its officers and/or directors pursuant to which the Company's may
borrow and such officers and/or directors are obligated to lend the
Company monies, there are no restrictions on the Company's right to
borrow money from officers and directors. No stockholder approval is
required in connection with any such loan.
Penny Stock Rules.
Under Rule 15g-9, a broker or dealer may not sell a "penny stock"
(as defined in Rule 3a51-1) to or effect the purchase of a penny stock by
any person unless:
(1) such sale or purchase is exempt from Rule 15g-9; or
(2) prior to the transaction the broker or dealer has (a) approved the
person's account for transaction in penny stocks in accordance with
Rule 15g-9 and (b) received from the person a written agreement to
the transaction setting forth the identity and quantity of the penny
stock to be purchased.
The United States Securities and Exchange Commission (the
"Commission") adopted regulations that generally define a penny stock to
be any equity security other than a security excluded from such
definition by Rule 3a51-1. Such exemptions include, but are not limited
to (a) an equity security issued by an issuer that has (i) net tangible
assets of at least $2,000,000, if such issuer has been in continuous
operations for at least three years; (ii) net tangible assets of at least
$5,000,000, if such issuer has been in continuous operation for less than
three years; or (iii) average revenue of at least $6,000,000 for the
preceding three years; (b) except for purposes of Section 7(b) of the
Exchange Act and Rule 419, any security that has a price of $5.00 or
more; and (c) a security that is authorized or approved for authorization
upon notice of issuance for quotation on the National Association of
Securities Dealers ("NASD") Automated Quotation System ("NASDAQ").
It is likely that the Company's common stock will be subject to the
regulations on penny stocks; consequently, the market liquidity for the
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Company's common stock may be adversely affected by such regulations.
This, in turn, will affect shareholders ability to sell their shares
following the completion of an acquisition.
There is no current trading market for shares of the Company's
common stock (the "Shares") and there can be no assurance that a trading
market will develop, or, if such a trading market does develop, that it
will be sustained. The Shares, to the extent that a market develops for
the Shares at all, will likely appear in what is customarily known as the
"pink sheets" or on the NASD over-the-counter Bulletin Board (the
"OTCBB"), which may limit the marketability and liquidity of the
Shares. A trading market will develop, if at all, only after the
acquisition of a target company.
To date, neither the Company nor anyone acting on behalf of the
Company has taken any affirmative steps to request or encourage any
broker/dealer to act as a market maker for the Company's common stock.
The Company has had no discussions or understandings, with any 'market
makers' regarding the participation of any such market maker in the
future trading market, if any, in the Company's common stock.
Management expects that discussions in this area will ultimately be
initiated by the management in office after completion of the acquisition
of a target company.
Risks Associated with Operations in Foreign Countries.
The Company's business plan is to seek to acquire a target
company. Management's discretion is unrestricted, and the Company may
participate in any business whatsoever that may in the opinion of
Management meet the Company's business objectives. The Company may
acquire a business outside the United States. The Company has not
limited the scope of its search to a particular region or country.
Accordingly, if the Company acquires a business located, or operating in
a foreign jurisdiction, the Company's operations may be adversely
affected to the extent of the existence of unstable economic, social
and/or political conditions in such foreign regions and countries.
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
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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.
No Agreement for Acquisition of a Target Company Combination.
The Company has no current arrangement, agreement or
understanding with respect to engaging in a merger with or acquisition of
a specific business 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
favourable 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.
Reporting Requirements May Delay or Preclude Acquisition.
Section 13 of the Exchange Act requires companies subject thereto
to provide certain information about significant acquisitions including
certified 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
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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
merger or acquisition 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 business entity. 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 that 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 officer and director of the Company and a
corresponding reduction in or elimination of his participation in the
future affairs of the Company.
Taxation.
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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.
Year 2000 Risks.
Many existing computer programs use only two digits to identify a
year in such program's 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 following the year 2000 ("Year 2000 Problem"). Many
of the computer programs containing such date language problems have
not been corrected by the companies or governments operating such
programs. It is impossible to predict what computer programs will be
affected, 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 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 acquire 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. MANAGEMENT'S DISCUSSION ANALYSIS OR PLAN OF
OPERATION
General Business Plan
The Company's purpose is to seek, investigate and, if such
investigation warrants, acquire a target company which desires to seek
the perceived advantages of a corporation which has a class of securities
registered under the Exchange Act.
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
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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 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.
Please refer to "PART 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 to expand into new
products or markets, to develop a new product or service, or for other
corporate purposes. The Company may acquire assets and establish
wholly-owned subsidiaries in various businesses or acquire existing
businesses as subsidiaries.
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 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 merger or acquisition transaction for the
owners of a business entity. Management has agreed, from time to time,
to advance to the Company by way of a non -interest bearing loan, the
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funds necessary to cover all costs associated with fling the requisite
reports under the Exchange Act.
The analysis of new business opportunities will be undertaken by,
or under the supervision of, the officer and director of the Company, who
is not a professional business analyst. In analysing 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 a reasonable period of time after the 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 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 be
inexperienced in matters relating to the business of a target company,
will rely upon its own efforts in accomplishing the business purposes of
the Company. Outside consultants or advisors may be utilized by the
Company to assist in the search for qualified target companies. If the
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Company does retain such an outside consultant or advisor, any cash fee
earned by such person will need to be assumed by the target company, as
the Company has limited cash assets with which to pay such obligation.
No such consultant or advisor has been retained and Management of the
Company has not in the past used particular consultants, advisors or
finders on a regular basis.
Following a business combination the Company may benefit from
the services of others in regard to accounting, legal services,
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.
Structure of Acquisition
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 a target
company. It may also acquire stock or assets of a target company. Upon
consummation of an acquisition, 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 officer and
director 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, of which there can be no
assurance, 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.
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
<PAGE>
Page 14
and thereby structure the acquisition in a "tax-free" reorganization under
Sections 351 or 368 of the Internal Revenue Code of 1986, as amended
(the "Code").
With respect to any merger or acquisition 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 with or
acquisition of a target company. 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 acquire or merge with any entity which
cannot provide audited financial statements at or within a reasonable
period of time after closing of the proposed transaction. The Company
will be subject to all of the reporting requirements included in the
Exchange Act. Included in these requirements is the Company's duty to
file audited financial statements as part of or within 15 days following
the filing of its Form 8-K with the Securities and Exchange Commission
upon consummation of a merger or acquisition, as well as the Company's
audited financial statements included in its annual report on Form 10-K
(or 10-KSB, as applicable). 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.
No Dividends
The Company has not paid any dividends on its common stock; nor
does the Company intend to declare and pay dividends prior to the
consummation of an acquisition. The payment of dividends after any
acquisition will be within the discretion of the Company's then Board of
Directors.
Employees
The Company presently has no employees. The Company has one
<PAGE>
Page 15
officer and director. Mr. Watt is engaged in other business
activities, and the amount of time he will devote to the Company's
business will only be between 5 and 10 hours per month. Upon
completion of the public offering, it is anticipated that Management will
devote such time to the Company's affairs each month as may be
necessary to carry on the Company's business plans.
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.
Liquidity And Capital Resources
The Company has limited working capital and a deficit. The ability
of the Company to continue as a going concern is dependent upon its
ability to obtain adequate financing to reach profitably levels of
operation. It is not possible to predict whether financing efforts will be
successful or if the Company will attain profitable levels of operations.
Mr. Watt has agreed to loan the Company, on an as needed basis, up
to $10,000 through December 31, 2001. The Company anticipates that
such amount will be (a) sufficient for payment of the Company's
operating expenses through December 31, 2001 and (b) repaid upon
completion of the acquisition of a target business. There can be no
assurances that such loans will be repaid as a result of any Business
Combination. In the event that no agreement can be reached to settle any
outstanding loans Mr. Watt has agreed to forgive the outstanding
indebtedness.
ITEM 3. DESCRIPTION OF PROPERTY
The Company has no properties and at this time has no agreements
to acquire any properties. The Company is presently using as a mailing
address, at no cost, the office of its president Colin Watt 1360 - 605
Robson Street, Vancouver BC Canada V6B 5J3. Such arrangement is
expected to continue until completion of the acquisition of a target
company. See "Part I-Item 7. Certain Relationships and Related
Transactions."
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.
<PAGE>
Page 16
NAME AND SHARES OF APPROXIMATE
ADDRESS OF COMMON PERCENTAGE
BENEFICIAL STOCK OWNED
OWNER BENEFICIALLY
OWNED
Colin Watt 725,000 100%
1360 - 605 Robson Street,
Vancouver BC Canada
V6B 5J3
Officers and Directors as 725,000 100%
a Group (1 person)
ITEM 5. DIRECTORS AND EXECUTIVE OFFICERS, PROMOTERS AND
CONTROL PERSONS.
Set forth below is the name of the sole director and officer of the
Company, all positions and offices with the Company held, the period
during which such person has ever served as such, and the business
experience during at least the last five years:
Name Age Positions and Offices Held
Colin Watt 29 President and Director (Since
October 18, 2000)
There are no agreements or understandings for the officer or
director to resign at the request of another person and the above-named
officer and director is not acting on behalf of nor will act at the direction
of any other person.
Colin Watt became sole officer and director of the Company on
October 18, 2000. Mr. Watt has been a consultant for the past 7 years
providing accounting, administrative and management services to public
companies. He is currently the president of Squall Capital Corp. a private
consulting company to public companies. His clients included a wide variety
of business including e-commerce, software development, mineral exploration,
mine development and oil and gas exploration.
Mr. Watt graduated witha Bachelor of Commerce (Finance) from the University
of British Columbia in 1993.
Conflicts of Interest.
The Company's sole officer and director 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 officer and director of the Company. Insofar as the officer and
director is engaged in other business activities, he 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
<PAGE>
Page 17
Company's proposed business operations.
A conflict may arise in the event that another blank check and/or
blind pool company (a "blind pool 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 blind pool companies in chronological order of the date of
formation of such blind pool companies or by lot. However, any blank
check companies that may be formed 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 blind pool company formed after the Company. In such
case, a business combination might be negotiated on behalf of the more
suitable or preferred blind pool company regardless of date of formation
or choice by lot. Mr. Watt will be responsible for seeking,
evaluating, negotiating and consummating a business combination with a
target company which may result in terms providing benefits to Mr.
Watt.
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 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.
Management has not adopted policies involving possible conflicts
of interest.
There are no binding guidelines or procedures for resolving
potential conflicts of interest. Failure by Management to resolve
conflicts of interest in favour 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 and the Exchange Act, Management believes that 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 not obtained a formal determination
from the Commission as to the status of the Company under the
Investment Company Act of 1940. Any violation of such Investment
Company Act would subject the Company to material adverse
<PAGE>
Page 18
consequences.
ITEM 6. EXECUTIVE COMPENSATION.
The Company's sole officer and director does not receive any
compensation for his services rendered to the Company, has not received
such compensation in the past, and is not accruing any compensation
pursuant to any agreement with the Company.
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 no properties and at this time has no agreements
to acquire any properties. The Company is presently using as its office
the office of its president, Colin Watt 1360 - 605 Robson Street,
Vancouver BC Canada V6B 5J3. Such arrangement is expected to
continue until completion of the acquisition of a target company.
ITEM 8. DESCRIPTION OF SECURITIES.
The Company is currently authorized to issue 1,000,000 shares of
common stock, $.001 par value per share, of which 725,000 shares were
issued and outstanding as of the date of this Registration Statement.
Each outstanding share of common stock entitles the holder to one vote,
either in person or by proxy, on all matters that may be voted upon by
the owners thereof at meetings of the shareholders.
The holders of common stock (i) have equal rights to dividends
from funds legally available therefor, when, as and if declared by the
Board of Directors of the Company; (ii) are entitled to share ratably in
all of the assets of the Company available for distribution to holders of
common stock upon liquidation, dissolution or winding up of the affairs
of the Company; (iii) do not have preemptive, subscription or conversion
rights, and (iv) are entitled to one non-cumulative vote per share on all
matters on which shareholders may vote at all meetings of shareholders.
Reports to Stockholders.
The Company intends to furnish its shareholders with annual
reports containing audited financial statements as soon as practicable
after the end of each fiscal year. The Company's fiscal year ends on
November 30. In addition, the Company intends to issue unaudited
interim reports and financial statements on a quarterly basis.
Dividends.
The Company has not declared any dividends since inception, and
has no present intention of paying any cash dividends on its common
stock in the foreseeable future. The payment by the Company of
dividends, if any, in the future, rests within the discretion of the
Company's Board of Directors and will depend, among other things, upon
<PAGE>
Page 19
the Company's earnings, capital requirements and financial condition, as
well as other relevant factors.
PART II
ITEM 1. MARKET PRICE OF AND DIVIDENDS ON THE REGISTRANT'S
COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.
There is no trading market for the Company's common stock at
present and there has been no trading market to date. The Company has 1
shareholder. Management does not intend to undertake any efforts to
cause a market to develop in the Company's securities until such time as
the Company has successfully implemented its business plan described
here. There are no plans, proposals, arrangements or understandings with
any person with regard to the development of a trading market in any of
the Company's securities. There is no assurance that a trading market
will ever develop or, if such a market does develop, that it will continue.
If a trading market develops, if at all, it will develop only after the
acquisition of a target company.
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. The Company files such reports. As a result, sales of the
Company's common stock in the secondary trading market by the holders
thereof may be made pursuant to Section 4(1)of the Securities Act (sales
other than by an issuer, underwriter or broker).
The Commission has adopted Rule 15g-9 which establishes the
definition of a "penny stock," for purposes relevant to the Company, as
any equity security that has a market price of less than $5.00 per share or
with an exercise price of less than $5.00 per share, subject to certain
exceptions. For any transaction involving a penny stock, unless exempt,
the rules require: (i) that a broker or dealer approve a person's account
for transactions in penny stocks and (ii) the broker or dealer receive from
the investor a written agreement to the transaction, setting forth the
identity and quantity of the penny stock to be purchased. In order to
approve a person's account for transactions in penny stocks, the broker or
dealer must (i) obtain financial information and investment experience
and objectives of the person; and (ii) make a reasonable determination
that the transactions in penny stocks are suitable for that person and that
person has sufficient knowledge and experience in financial matters to be
capable of evaluating the risks of transactions in penny stocks. The
broker or dealer must also deliver, prior to any transaction in a penny
stock, a disclosure schedule prepared by the Commission relating to the
penny stock market, which, in highlight form, (i) sets forth the basis on
which the broker or dealer made the suitability determination and (ii)
that the broker or dealer received a signed, written agreement from the
investor prior to the transaction. Disclosure also has to be made about
the risks of investing in penny stocks in both public offerings and in
secondary trading, and about commissions payable to both the broker-
dealer and the registered representative, current quotations for the
securities and the rights and remedies available to an investor in cases of
<PAGE>
Page 20
fraud in penny stock transactions. Finally, monthly statements have to
be sent disclosing recent price information for the penny stock held in
the account and information on the limited market in penny stocks.
If, after a merger or acquisition, the Company does not meet the
qualifications for listing on the Nasdaq Stock Market Inc.'s SmallCap
Market ("NASDAQ-SCM"), the Company's securities may be traded on
the OTCBB. The OTCBB market differs from national and regional stock
exchanges in that it (1) is not sited in a single location but operates
through communication of bids, offers and confirmations between broker-
dealers and (2) securities admitted to quotation are offered by one or
more broker-dealers rather than the "specialist" common to stock
exchanges. The Company may seek to have its securities quoted on the
OTCBB or may offer its securities in what are commonly referred to as
the "pink sheets" of the National Quotation Bureau, Inc.
In order to qualify for listing on the NASDAQ-SCM, 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.
If the Company is unable initially to satisfy the requirements for
quotation on the NASDAQ-SCM or becomes unable to satisfy the
requirements for continued quotation thereon, and trading, if any, is
conducted in the OTCBB, a shareholder may find it more difficult to
dispose of, or to obtain accurate quotations as to the market value of, the
Company's securities.
Dividends. The Company has not paid any dividends to date, and
has no plans to do so in the immediate future.
ITEM 2. LEGAL PROCEEDINGS.
There is no litigation pending or threatened by or against the
Company.
ITEM 3. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS.
The Company has not changed accountants since its formation and
there are no disagreements with the findings of its accountants.
ITEM 4. RECENT SALES OF UNREGISTERED SECURITIES.
Within the last 3 years the Company has sold securities which were
not registered as follows:
<PAGE>
Page 21
(1) 725,000 shares of common stock to Mr. Colin Watt.
The Company believes that all of these securities were issued in
transactions except from the registration requirements of the Securities
Act by virtue of Section 4(2) thereof.
ITEM 5. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 145 of the General Corporation Law of the State of
Delaware provides that a Delaware corporation has the power, under
specified circumstances, to indemnify its directors, officers, employees
and agents, against expenses incurred in any action, suit or proceeding.
The Certificate of Incorporation and the By-laws of the Company provide
for indemnification of directors and officers to the fullest extent
permitted by the General Corporation Law of the State of Delaware.
The General Corporation Law of the State of Delaware provides
that a certificate of incorporation may contain a provision eliminating
the personal liability of a director to the corporation or its stockholders
for monetary damages for breach of fiduciary duty as a director provided
that such provision shall not eliminate or limit the liability of a director
(i) for any breach of the director's duty of loyalty to the corporation or
its stockholders, (ii) for acts or omissions not in good faith or which
involve intentional misconduct or a knowing violation of law, (iii) under
Section 174 (relating to liability for unauthorized acquisitions or
redemptions of, or dividends on, capital stock) of the General
Corporation Law of the State of Delaware, or (iv) for any transaction
from which the director derived an improper personal benefit. The
Company's Certificate of Incorporation contains such a provision.
INSOFAR AS INDEMNIFICATION FOR LIABILITIES ARISING
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, MAY BE
PERMITTED TO DIRECTORS, OFFICERS OR PERSONS CONTROLLING
THE COMPANY PURSUANT TO THE FOREGOING PROVISIONS, IT IS
THE OPINION OF THE SECURITIES AND EXCHANGE COMMISSION
THAT SUCH INDEMNIFICATION IS AGAINST PUBLIC POLICY AS
EXPRESSED IN THE ACT AND IS THEREFORE UNENFORCEABLE.
PART F/S
FINANCIAL STATEMENTS
Index
Page
Auditors Report Dated October 31, 2000 22
Audited Balance Sheet as at October 31, 2000 23
Audited Statement of Loss for the year ended October 31, 2000 24
Audited Statement of Cash Flow for the year ended October 31, 2000 25
Statement of Shareholder Equity (Deficit) for the year October 31, 2000 26
Notes to Financial Statements 27
<PAGE>
Page 22
Russell & Co.
AUDITORS' REPORT TO THE DIRECTORS OF:
WOODRIDGE CAPITAL CORP.
(A Delaware Corporation)
(A development stage company)
We have audited the balance sheet of Woodridge Capital Corp. as at October
31, 2000 and the statements of loss and shareholders' equity (deficit) and
cash flows for the period from the date of inception, October 18, 2000, to
October 31, 2000. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on
these financial statements based on our audit.
We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform an audit to
obtain reasonable assurance 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.
In our opinion, these financial statements present fairly, in all material
respects, the financial position of the Company as at October 31, 2000
and the results of its operations and its cash flows for the period from
the date of inception, October 18, 2000, to October 31, 2000 in
accordance with accounting principles generally accepted in the United
States.
The accompanying financial statements have been prepared assuming that
the Company will continue as a going concern. As discussed in Note 1 to
the financial statements, the Company's negative working capital and
deficit raises substantial doubt about its ability to continue as a going
concern. The financial statements do not contain any adjustments that
might result from the outcome of this uncertainty.
/s/ Russel & Co.
Chartered Accountant
West Vancouver, B.C.
Canada.
November 4, 2000
415 Gordon Ave., West Vancouver, B.C., V7T 1P4
Telephone: (604) 913-0405 - Fax: (604) 913-0406
<PAGE>
Page 23
WOODRIDGE CAPITAL CORP.
(A Delaware Corporation)
(A development stage company)
Balance Sheet
as at October 31, 2000
(U.S. DOLLARS)
2000
Assets
Current assets
Cash and bank $ -
-----------------------------------------------------------------
-
-----------------------------------------------------------------
Incorporation costs 725
-----------------------------------------------------------------
Total Assets $ 725
=================================================================
Liabilities
Current liabilities
Accounts payable $ 500
-----------------------------------------------------------------
Total Liabilities 500
-----------------------------------------------------------------
Shareholders' equity (deficit)
Share Capital
Authorized:
1,000,000 common shares with a par value of $0.001each
Issued and outstanding
725,000 common shares with a par value of $0.001
at October 31, 2000 725
-----------------------------------------------------------------
725
Deficit Accumulated During the Development stage
(500)
-----------------------------------------------------------------
225
$ 725
=================================================================
CONTINUING OPERATIONS (NOTE 1)
<PAGE>
Page 24
WOODRIDGE CAPITAL CORP.
(A Delaware Corporation)
(A development stage company)
Statement of Loss
For the period from October 18, 2000 (Inception) to October 31, 2000,
(U.S. DOLLARS)
Period from October 18, 2000
to October 31, 2000
Expenses
Accounting and audit $ 500
Legal -
-----------------------------------------------------------------
Net earnings (loss) for the period $ 500
=================================================================
Basic and diluted loss per share $(0.0007)
-----------------------------------------------------------------
Weighted average shares Outstanding 725,000
-----------------------------------------------------------------
<PAGE>
Page 25
WOODRIDGE CAPITAL CORP.
(A Delaware Corporation)
(A development stage company)
Statement of Cash Flow
For the period from October 18, 2000 (Inception) to October 31, 2000
(U.S. DOLLARS)
Period from October 18, 2000
to October 31, 2000
Cash provided by (used in)
Operations
Net Loss for period $ (500)
-----------------------------------------------------------------
(500)
Net change in non-cash working
capital balances
Accounts Payable 500
-----------------------------------------------------------------
Net cash used in operating activities -
-----------------------------------------------------------------
Investing
Incorporation costs (725)
-----------------------------------------------------------------
Financing
Issuance of capital stock 725
-----------------------------------------------------------------
Change in cash for period -
Cash, beginning of period -
-----------------------------------------------------------------
Cash, end of period $ -
<PAGE>
Page 26
WOODRIDGE CAPITAL CORP.
(A Delaware Corporation)
(A development stage company)
Statement of Shareholders' Equity (Deficit)
For the period from October 18,2000 (Inception) to October 31, 2000
(U.S. DOLLARS)
Deficit Total
accumulated Share-
Common shares during the holders'
Shares Amount Development Equity
Stage (Deficit)
Paid-in capital at inception on
October 18, 2000 725,000 $ 725 $ - $ 725
Net loss - - (500) (500)
-----------------------------------------------------------------------------
Balance at October 31, 2000 725,000 $ 725 $(500) $ 225
=============================================================================
<PAGE>
Page 27
WOODRIDGE CAPITAL CORP.
(A Delaware Corporation)
(A development stage company)
Notes to Financial Statements
Year ended October 31, 2000
(U.S. DOLLARS)
1. Continuing operations
Woodridge Capital Corp. was incorporated on October 18,2000 in the state
of Delaware, U.S.A.
The Company has negative working capital and a deficit. The ability
for the Company to operate as a going concern is dependent upon its
ability to find an appropriate business venture and to obtain adequate
financing to reach profitable levels of operations. It is not possible to
predict whether the search for a business venture or financing efforts will
be successful or if the Company will attain profitable levels of
operations.
2. Summary of significant accounting policies
These financial statements have been prepared in accordance with
generally accepted accounting principles in the United States and reflect
the following significant accounting principles:
a. Estimates and assumptions
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make assumptions
that affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements
and the reported amount of revenues and expenses during the reporting
period. Actual results could differ from those estimates.
b. Earnings (loss) per common share
In February, 1997, the Financial Accounting Standards Board issued
Statement No. 128, Earnings Per Share (SFAS 128), which established
new standards for computing and presenting earnings per share effective
for fiscal years ending after December 15, 1997. With SFAS 128,
primary earnings per share is replaced by basic earnings per share, which
is computed by dividing income available to common shareholders by the
weighted average number of shares outstanding for the period. In
addition, SFAS 128 requires the presentation of diluted earnings per
share, which includes the potential dilution that could occur if dilutive
securities were exercised or converted into common stock. The
computation of diluted EPS does not assume the conversion or exercise
of securities if their effect is anti-dilutive. Common equivalent shares
consist of the common shares issuable upon the conversion of the
convertible loan notes and special warrants (using the if-converted
method) and incremental shares issuable upon the exercise of stock
options and share purchase warrants ( using the treasury stock method).
c. Cash and cash equivalents
Cash and cash equivalents consist of cash on hand, deposits in banks and
highly liquid investments with an original maturity of three months or
less.
4. Income taxes
The Company has net operating losses which may give rise to future tax
benefits of approximately $500 as of October 31, 2000. To the extent not
used, net operating loss carryforwards expire in beginning in the year
2015. Income taxes are accounted for in accordance with Statement of
Financial Accounting Standards No.109 (SFAS 109). Under this method,
deferred income taxes are determined based on differences between the
tax basis of assets and liabilities and their financial reporting amounts at
each year end, and are measured based on enacted tax rates and laws that
will be in effect when the differences are expected to reverse. Valuation
allowances are established, when necessary, to reduce deferred tax assets
to the amount expected to be realized. No provision for income taxes is
included in the statement due to its immaterial amount.
<PAGE>
Page 28
WOODRIDGE CAPITAL CORP.
Registration Statement and Form 10SB
Exhibits
Exhibits Page
2(1) Certificate of Incorporation..................29
2(2) By-laws.......................................30
Signatures
In accordance with Section 12 of the Securities Exchange Act of 1934,
the registrant cause this registration statement to be signed on its behalf
by the undersigned, thereunto duly authroized.
WOODRIDGE CAPITAL CORP.
----------------------------
(Registrant)
Date: December 21, 2000 By: /s/ Colin Watt
------------------------ -----------------------------
Colin Watt, President
<PAGE>
Page 29
State of Delaware
Office of the Secretary of State
I, EDWARD J. FREEL, SECRETARY OF STATE OF THE STATE
OF DELAWARE, DO HEREBY CERTIFY THE ATTACHED IS A TRUE
AND CORRECT COPY OF THE CERTIFICATE OF INCORPORATION OF
"WOODRIDGE CAPITAL CORP.", FILED IN THIS OFFICE ON THE
EIGHTEENTH DAY OF OCTOBER, A.D. 2000, AT 4:30 O'CLOCK P.M.
A FILED COPY OF THIS CERTIFICATE HAS BEEN FORWARDED
TO THE NEW CASTEL COUNTY RECORDER OF DEEDS.
/s/ Edward J. Freel
------------------------------------
Edward J. Freel, Secretary of State
3304065 8100 AUTHENTICATION: 0743042
001526470 DATE: 10-19-00
<PAGE>
Page 30
STATE OF DELAWARE
CERTIFICATE OF INCORPORATION
A STOCK CORPORATION
First: The name of this Corporation is Woodridge Capital Corp.
Second: Its registered office in the State of Delaware is to be located at
1209 Orange Street, in the City of Wilmington County of New Castle Zip
Code 19801. The registered agent in charge thereof is The Corporation
Trust Company.
Third: The purpose of the corporation is to engage in any lawful act or
activity for which corporations may be organized under the General
Corporation Law of Delaware.
Fourth: The amount of the total authorized capital stock of this
corporation is One Thousand Dollars ($1,000) divided into One Million
shares of One - One thousandth Dollars ($0.001) each.
Fifth: The name and mailing address of the incorporator are as follows:
Michael L. Seifert
4480 Ross Crescent, West Vancouver
British Columbia, Canada, V7W 1B2
I, The Undersigned, for the purpose of forming a corporation under the
laws of the State of Delaware, do make, file and record this Certificate,
and do certify that the facts herein stated are true, and I have accordingly
hereunto set my hand this 16th day of October, A.D. 2000.
BY: /s/ Michael L. Seifert
---------------------------
(Incorporator)
NAME: MICHAEL L.SEIFERT
-----------------------
(Type or Print)
BYLAWS
- of -
WOODRIDGE CAPITAL CORP.
PART 1 - INTERPRETATION
1.1 In these Bylaws, unless the context otherwise requires:
(a) "Board of Directors" or "Board" means the Directors of the
Corporation for the time being;
(b) "The Act" means the General Corporation Law of the State of
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Delaware from time to time in force and all amendments thereto and
includes all regulations and amendments thereto made pursuant to that
Act;
(c) "Directors" means the Directors of the Corporation for the time
being;
(d) "month" means calendar month;
(e) "register" means the register of stockholders;
(f) "registered address" of a stockholder shall be his address as
recorded in the register;
(g) "registered address" of a Director means his address as
recorded in the Corporation`s register of Directors;
(h) "seal" means the common seal of the Corporation, if the
Corporation has one;
(j) "Secretary of State" means the Secretary of State for the State
of Delaware appointed pursuant to The Act;
(k) "registrar" means the registrar of the Corporation`s shares
appointed pursuant to Part 4 of these Bylaws.
1.2 Expressions referring to writing shall be construed as
including references to printing, lithography, typewriting, photography
and other modes of representing or reproducing words in a visible form.
1.3 Words importing the singular include the plural and vice versa;
and words importing a male person include a female person and a
corporation.
1.4 The definitions in The Act shall with the necessary changes
and so far as applicable apply to these Bylaws.
PART 2 - SHARES AND SHARE CERTIFICATES
2.1 Every stockholder is entitled, without charge, to one
certificate representing the share or shares of each class held by him or
upon paying a sum not exceeding any amount permitted by The Act, as
the Directors may from time to time determine, or several certificates
each for one or more of those shares; provided that, in respect of a share
or shares held jointly by several persons the Corporation shall not be
bound to issue more than one certificate, and delivery of a certificate for
a share to one of several joint holders or to his duly authorized agent
shall be sufficient delivery to all; and provided further that the
Corporation shall not be bound to issue certificates representing
redeemable shares, if the shares are to be redeemed within one month of
the date on which they were allotted. Any share certificate may be sent
by registered prepaid mail to the stockholder entitled thereto at his
registered address, and the Corporation shall not be liable for any loss
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occasioned to the stockholder as a result of any share certificate sent
being lost in the post or stolen.
2.2 If a share certificate:
(a) is worn out or defaced, the Directors may, upon production to
them of that certificate and upon other terms if any, as they may think
fit, order the certificate to be cancelled and may issue a new certificate
in lieu thereof;
(b) is lost, stolen, or destroyed, then upon proof thereof to the
satisfaction of the Directors and upon such indemnity, if any, as the
Directors deem adequate being given, a new share certificate in place
thereof shall be issued to the person entitled to the lost, stolen or
destroyed certificate; or
(c) represents more than one share and the registered owner thereof
surrenders it to the Corporation with a written request that the
Corporation issue registered in his name two or more certificates each
representing a specified number of shares and in the aggregate
representing the same number of shares as the certificate surrendered, the
Corporation shall cancel the certificate surrendered and issue in place
thereof certificates in accordance with the request.
A sum, if any, not exceeding that permitted by The Act, as the Directors
may from time to time fix, shall be paid to the Corporation for each
certificate issued under this Bylaw.
2.3 Except as required by law or statute or these Bylaws, no person
shall be recognized by the Corporation as holding any share upon any
trust, and the Corporation shall not be bound by or compelled in any way
to recognize (even when having notice) any equitable, contingent, future
or partial interest in any share or any interest in any fractional part of a
share or (except only as by law or statute or these Bylaws provided or as
ordered by a court of competent jurisdiction) any other rights in respect
of any share except an absolute right to the entirety in the registered
holder.
2.4 Every share certificate shall be signed manually by at least one
Officer or Director of the Corporation, or by or on behalf of a registrar,
branch registrar, transfer agent or branch transfer agent of the
Corporation and any additional signatures may be printed or otherwise
mechanically reproduced and a certificate signed in either of those
fashions shall be as valid as if signed manually, notwithstanding that any
person whose signature is printed or mechanically reproduced on a share
certificate has ceased to hold the office that he is stated on the
certificate to hold at the date of the issue of a share certificate.
2.5 Save as provided by The Act, the Corporation shall not give
financial assistance by means of a loan, guarantee, the provision of
security or otherwise for the purpose of or in connection with the
purchase of or subscription by any person for shares or debt obligations
issued by the Corporation or an affiliate of the Corporation or upon the
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security, in whole or in part, of a pledge or other charge upon the shares
or debt obligations issued by the Corporation or an affiliate of the
Corporation.
2.6 Every share certificate issued by the Corporation shall be in a
form as the Directors approve and shall comply with The Act.
2.7 The certificates for shares registered in the name of two or
more persons shall be delivered to the person first named on the register.
2.8 The Corporation may issue warrants and options for the
purchase of shares on terms and conditions and for consideration as the
Directors may determine; and the Corporation may pay a commission to
any person in consideration of his purchasing or procuring the purchase
of a warrant or option.
PART 3 - ISSUE OF SHARES
3.1 Subject to The Act and to any direction to the contrary
contained in a resolution passed at a general meeting authorizing any
increase of capital, the issue of shares shall be under the control of the
Directors who may, subject to the rights of the holders of the shares of
the Corporation for the time being issued, allot or otherwise dispose of,
and grant options on, shares authorized but not yet issued at times and to
persons, including Directors, and in a manner and upon terms and
conditions, and at a price or for a consideration, as the Directors, in their
absolute discretion, may determine.
3.2 The Directors on behalf of the Corporation may pay a
commission or allow a discount to any person in consideration of his
subscribing or agreeing to subscribe, whether absolutely or conditionally,
for any shares with a par value in the Corporation, or procuring or
agreeing to procure subscriptions, whether absolutely or conditionally,
for any shares provided that the rate of the commission or discount shall
not in the aggregate exceed 25% of the subscription price of the shares,
or an amount equivalent to the percentage. The Corporation may also pay
brokerage as may be lawful.
3.3 No share may be issued until it is fully paid by the receipt by
the Corporation of the full consideration therefor in cash, property or
past services actually performed for the Corporation. A document
evidencing indebtedness of the person to whom the shares are allotted is
not property for the purposes of this Bylaw. The value of property and
services for the purposes of this Bylaw shall be the value determined by
the Directors by resolution to be, in all circumstances of the transaction,
the fair market value thereof.
PART 4 - REGISTERS
4.1 The Corporation shall keep or cause to be kept a register of
stockholders, a register of transfers and a register of allotments and may
combine one or more of such registers. If the Corporation`s capital shall
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consist of more than one class of shares, a separate register of
stockholders, register of transfers and register of allotments may be kept
in respect of each class of shares. The Directors on behalf of the
Corporation may appoint a trust company to keep the register of
stockholders, register of transfers and register of allotments or, if there
is more than one class of shares, the Directors may appoint a trust
company, which need not be the same trust company, to keep the register
of stockholders, the register of transfers and the register of allotments
for each class of share. The Directors on behalf of the Corporation may
also appoint one or more trust companies, including the trust company
which keeps the said registers of its shares or of a class thereof, as
transfer agent for its shares or such class thereof, as the case may be, and
the same or another trust company or companies as registrar for its shares
or such class thereof, as the case may be. The Directors may terminate
the appointment of any trust company at any time and may appoint
another trust company in its place.
4.2 Unless prohibited by The Act, the Corporation may keep or
cause to be kept one or more branch registers of stockholders at a place
or places as the Directors may from time to time determine.
4.3 The Corporation shall not at any time close its register of
stockholders save and except as permitted by The Act.
4.4 The Corporation shall keep or cause to be kept a register of its
debentures and a register of debentureholders, which registers may be
combined, and, may keep or cause to be kept one or more branch
registers of its debentureholders at a place or places as the Directors may
from time to time determine and the Directors may by resolution,
regulation or otherwise, make provisions as they think fit respecting the
keeping of branch registers.
PART 5 - TRANSFER AND TRANSMISSION OF SHARES
5.1 Subject to the provisions of the Certificate of Incorporation
and of these Bylaws that may be applicable, any stockholder may transfer
any of his shares by instrument in writing executed by or on behalf of the
stockholder and delivered to the Corporation or its transfer agent. The
instrument of transfer of any share of the Corporation shall be in the
form, if any, on the back of the Corporation`s share certificates or in any
other form as the Directors may from time to time approve. Except to the
extent that The Act may otherwise provide, the transferor shall be
deemed to remain the holder of the shares until the name of the
transferee is entered in the register of stockholders or a branch register
of stockholders in respect thereof. If the Directors require, each
instrument of transfer shall be in respect of only one class of share.
5.2 The signature of the registered owner of any shares, or of his
duly authorized attorney, upon an authorized instrument of transfer shall
constitute a complete and sufficient authority to the Corporation, its
Directors, Officers and agents to register, in the name of the transferee
as named in the instrument of transfer, the number of shares specified or,
if no number is specified, all the shares of the registered owner
represented by share certificates deposited with the instrument of
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transfer. If no transferee is named in the instrument of transfer, the
instrument of transfer shall constitute a complete and sufficient authority
to the Corporation, its Directors, Officers and agents to register, in the
name of the person in whose behalf any certificate for the shares to be
transferred is deposited with the Corporation for the purpose of having
the transfer registered, the number of shares specified in the instrument
of transfer or, if no number is specified, all the shares represented by all
share certificates deposited with the instrument of transfer.
5.3 Neither the Corporation nor any Director, Officer or agent
shall be bound to enquire into the title of the person named in the form
of transfer as transferee, or, if no person is named therein as transferee,
of the person on whose behalf the certificate is deposited with the
Corporation for the purpose of having the transfer registered or be liable
to any claim by such registered owner or by any intermediate owner or
holder of the certificate or of any of the shares represented thereby or
any interest therein for registering the transfer, and the transfer, when
registered, shall confer upon the person in whose name the shares have
been registered a valid title to the shares.
5.4 Every instrument of transfer shall be executed by the transferor
and left at the registered office of the Corporation or at the office of its
transfer agent or registrar for registration together with the share
certificate for the shares to be transferred and other evidence as the
Directors or the transfer agent or registrar may require to prove the title
of the transferor or his right to transfer the shares and the right of the
transferee to have the transfer registered. All instruments of transfer
where the transfer is registered shall be retained by the Corporation or
its transfer agent or registrar and any instrument of transfer, where the
transfer is not registered, shall be returned to the person depositing the
same together with the share certificate which accompanied the same
when tendered for registration.
5.5 There shall be paid to the Corporation in respect of the
registration of any transfer a sum, if any, as the Directors may from time
to time determine, not exceeding that permitted by The Act.
5.6 In the case of the death of a stockholder, the survivor or
survivors where the deceased was a joint registered holder, and the legal
personal representative of the deceased where he was the sole holder,
shall be the only persons recognized by the Corporation as having any
title to his interest in the shares. Before recognizing any legal personal
representative the Directors may require him to deliver to the
Corporation the original or a court-certified copy of a Grant of Probate
or Letters of Administration or other evidence and documents as the
Directors consider appropriate in order to establish the right of the
personal representative to the title to the interest in the shares of the
deceased stockholder.
5.7 Upon the death or bankruptcy of a stockholder, his personal
representative or trustee in bankruptcy, although not a stockholder, shall
have the same rights, privileges and obligations that attach to the shares
formerly held by the deceased or bankrupt stockholder if the documents
required by The Act and these Bylaws shall have been deposited with the
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Corporation. This Bylaw does not apply on the death of a stockholder
with respect to shares registered in his name and the name of another
person in joint tenancy.
5.8 Any person becoming entitled to a share in consequence of the
death or bankruptcy of a stockholder shall, upon documents and evidence
being produced to the Corporation as The Act and these Bylaws require
or who becomes entitled to a share as a result of an order of a Court of
competent jurisdiction or a Statute, has the right either to be registered
as a stockholder in his representative capacity in respect of the share, or,
if he is a personal representative, instead of being registered himself, to
make a transfer of the share as the deceased or bankrupt person could
have made; but the Directors shall, as regards a transfer by a personal
representative or trustee in bankruptcy, have the same right, if any, to
decline or suspend registration of a transferee as they would have in the
case of a transfer of a share by the deceased or bankrupt person before
the death or bankruptcy.
PART 6 - ALTERATION OF CAPITAL
6.1 The Corporation may file with the Secretary of State such
documents as are required to increase the share capital of the Corporation
by:
(a) creating shares; or
(b) increasing the number of shares.
6.2 The Corporation may subdivide, consolidate, change the
designation of, all or any of its shares but only to the extent, in the
manner and with the consent of stockholders holding a class of shares
which is the subject of or affected by the alteration, as The Act provides.
6.3 The Corporation may alter these Bylaws:
(a) to create, define and attach special rights or restrictions to any
shares, and
(b) by otherwise complying with any applicable provision of its
Certificate of Incorporation or these Bylaws, to vary or abrogate any
special rights and restrictions attached to any shares and in each case by
filing a certified copy of the resolution with the Secretary of State but no
right or special right attached to any issued shares shall be prejudiced or
interfered with unless all stockholders holding shares of each class
whose right or special right is prejudiced or interfered with consent
thereto in writing, or unless a resolution consenting is passed at a
separate class meeting of the holders of the shares of each class by a
majority of three-fourths, or such greater majority as may be specified by
the special rights attached to the class of shares, of the issued shares of
the class.
6.4 Notwithstanding any consent in writing or resolution, no
alteration shall be valid as to any part of the issued shares of any class
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unless the holders of all of the issued shares of the class either all
consent in writing or consent by a resolution passed by the votes of
stockholders holding three-fourths of the shares.
6.5 Except as otherwise provided by conditions imposed at the
time of creation of any new shares or by these Bylaws, any addition to
the authorized capital resulting from the creation of new shares shall be
subject to the provisions of these Bylaws.
PART 7 - PURCHASE AND REDEMPTION OF SHARES
7.1 Subject to the special rights and restrictions attached to any
class of shares, the Corporation may, by a resolution of the Directors and
in compliance with The Act, purchase any of its shares at the price and
upon the terms specified in such resolution or redeem any class of its
shares in accordance with the special rights and restrictions attaching
thereto. No purchase or redemption shall be made if the Corporation is
insolvent at the time of the proposed purchase or redemption or if the
proposed purchase or redemption would render the Corporation insolvent.
Unless the shares are to be purchased through a stock exchange or from a
bona fide employee or bona fide former employee, of the Corporation of
an affiliate, or from his personal representative, or the Corporation is
purchasing the shares from dissenting stockholders pursuant to the
requirements of The Act, the Corporation shall make its offer to purchase
pro rata to every stockholder who holds shares of the class or kind, as the
case may be, to be purchased.
7.2 If the Corporation proposes at its option to redeem some but
not all of the shares of any class, the Directors may, subject to the
special rights and restrictions attached to the class of shares, decide the
manner in which the shares to be redeemed shall be selected.
7.3 Subject to the provisions of The Act, any shares purchased or
redeemed by the Corporation may be sold or issued by it, but, while such
shares are held by the Corporation, it shall not exercise any vote in
respect of, or pay any dividend on those shares.
PART 8 - BORROWING POWERS
8.1 The Directors may from time to time on behalf of the
Corporation:
(a) borrow money in a manner and amount, on any security, from
any source and upon any terms and conditions;
(b) issue bonds, debentures, and other debt obligations either
outright or as security for any liability or obligation of the Corporation
or any other person; and
(c) mortgage, charge, whether by way of specific or floating
charge, or give other security n the undertaking, or on the whole or any
part of the property and assets, of the Corporation (both present and
future).
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8.2 Any bonds, debentures or other debt obligations of the
Corporation may be issued at a discount, premium or otherwise, and with
any special privileges as to redemption, surrender, drawing, allotment of
or conversion into or exchange for shares or other securities, attending
and voting at general meetings of the Corporation, appointment of
Directors or otherwise and may by their terms be assignable free from
any equities between the Corporation and the person to whom they were
issued or any subsequent holder thereof, all as the Directors may
determine.
8.3 Every bond, debenture or other debt obligation of the
Corporation shall be signed manually by at least one Director or Officer
of the Corporation or by or on behalf of a trustee, registrar, branch
registrar, transfer agent or branch transfer agent for the bond, debenture
or other debt obligation appointed by the Corporation or under any
instrument under which the bond, debenture or other debt obligation is
issued and any additional signatures may be printed or otherwise
mechanically reproduced thereon and a bond, debenture or other debt
obligation signed in that manner is as valid as if signed manually
notwithstanding that any person whose signature is so printed or
mechanically reproduced shall have ceased to hold the office that he is
stated on the bond, debenture or other debt obligation to hold at the date
of the issue thereof.
PART 9 - GENERAL MEETINGS
9.1 Subject to Bylaw 9.2 and to The Act, the first annual general
meeting shall be held within 15 months from the date of incorporation
and the following annual general meetings shall be held once in every
calendar year at a time, not being more than 13 months after the holding
of the last preceding annual general meeting, and at a place as the
Directors shall appoint. In default of the meeting being held, the meeting
shall be called by any two stockholders in the same manner as nearly as
possible as that in which meetings are to be called by the Directors.
9.2 If the Corporation is a close corporation and if all stockholders
entitled to attend and vote at the annual general meeting of the
Corporation consent in writing each year to the business required to be
transacted at the annual general meeting, that business shall be as valid
as if transacted at an annual general meeting duly convened and held and,
it is not necessary for the Corporation to hold an annual general meeting
that year.
9.3 The Directors may, whenever they think fit, convene a general
meeting. A general meeting, if requisitioned in accordance with The Act,
shall be convened by the Directors or, if not convened by the Directors,
may be convened by the requisitionists as provided in The Act.
9.4 Not less than 21 days' notice of any general meeting specifying
the time and place of meeting and in case of special business, the general
nature of that business shall be given in the manner mentioned in Bylaw
22, or in such other manner, if any, as may be prescribed by ordinary
resolution whether previous notice has been given or not, to any person
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as may by law or under these Bylaws or other regulations of the
Corporation entitled to receive the notice from the Corporation. But the
accidental omission to give notice of any meeting to, or the non-receipt
of any notice, by any person shall not invalidate any proceedings at that
meeting.
9.5 Persons entitled to notice of a general meeting may waive or
reduce the period of notice convening the meeting, by unanimous consent
in writing, and may give such waiver before, during or after the meeting.
PART 10 - PROCEEDINGS AT GENERAL MEETINGS
10.1 Subject to Bylaw 10.2, a quorum shall be one stockholder or
one proxyholder representing one or more stockholders holding not less
than fifty (50%) percent of the issued shares entitled to be voted at that
meeting. If there is only one stockholder of the Corporation, the quorum
is one person present and being, or representing by proxy, such
stockholder.
10.2 If within one-half hour from the time appointed for a meeting
a quorum is not present, the meeting, if convened by requisition of the
stockholders, shall be dissolved. In any other case it shall stand
adjourned to the same day in the next week at a time and place
determined by the Board of Directors. If at the adjourned meeting a
quorum is not present within one-half hour from the time appointed, the
stockholders present shall be a quorum.
10.3 The Chairman of the Board, if any, or in his absence, the
President of the Corporation, or their appointee shall be entitled to
preside as Chairman at every general meeting of the Corporation.
10.4 If at any meeting neither the Chairman of the Board, if any,
nor the President or his appointee is present within fifteen minutes after
the time appointed for holding the meeting or is willing to act as
Chairman, the Directors present shall choose someone to be Chairman. If
no Director be present or if all the Directors present decline to take the
chair or shall fail to choose, the stockholders present shall choose one of
their number to be Chairman.
10.5 The Chairman of the meeting may, with the consent of any
meeting at which a quorum is present and shall if so directed by the
meeting, adjourn the meeting from time to time and from place to place,
but no business shall be transacted at any adjourned meeting other than
the business left unfinished at the meeting from which the adjournment
took place. When a meeting is adjourned for 30 days or more, seven days'
notice of the adjourned meeting shall be given, otherwise notice is not
required.
10.6 Subject to the provisions of The Act, every question
submitted to a general meeting shall be decided on a show of hands
unless a poll is, before or on the declaration of the result of the show of
hands, directed by the Chairman or demanded by a stockholder entitled to
vote who is present in person or by proxy, and the Chairman shall declare
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to the meeting the decision on every question in accordance with the
result of the show of hands or the poll, and the decision shall be entered
in the book of proceedings of the Corporation. A declaration by the
Chairman that a resolution has been carried or carried unanimously or by
a particular majority, or lost or not carried by a particular majority, and
an entry to that effect in the book containing the minutes of the
proceedings of the Corporation shall be conclusive evidence of the fact
without proof of the number or proportion of the votes recorded in favour
of or against the resolution.
10.7 No resolution proposed at a meeting need be seconded and the
Chairman of any meeting (provided he is entitled to vote) shall be
entitled to move or second a resolution, without the necessity of
relinquishing the chair.
10.8 In case of an equality of votes at a general meeting, the
Chairman shall not, either on a show of hands or on a poll, have a casting
or a second vote in addition to the vote or votes to which he may be
entitled as a stockholder.
10.9 No poll may be demanded on the election of a Chairman. A
poll demanded on a question of adjournment shall be taken forthwith. A
poll demanded on any other question shall be taken as soon as, in the
opinion of the Chairman, is reasonably convenient, but in no event later
than seven days after the meeting and at a time and place and in a manner
as the Chairman of the meeting directs. The result of the poll shall be
deemed to be the resolution of and passed at the meeting at which the
poll was demanded. Any business other than that upon which the poll has
been demanded may be proceeded with pending the taking of the poll. A
demand for a poll may be withdrawn. In any dispute as to the admission
or rejection of a vote, the decision of the Chairman made in good faith
shall be final and conclusive.
10.10 A stockholder entitled to more than one vote need not, if he
votes, use all his votes or cast all the votes he uses in the same way.
10.11 The demand of a poll shall not prevent the continuance of a
meeting for the transaction of any business other than the question on
which a poll has been demanded.
10.12 Every ballot cast upon a poll, and every proxy appointing a
proxyholder who cast a ballot upon a poll, shall be retained by the
Secretary for at least three months and be subject to inspection as The
Act may provide.
PART 11 - VOTES OF STOCKHOLDERS
11.1 Subject to any special voting rights or restrictions attached to
any class of shares and the restrictions on joint registered holders of
shares, on a show of hands every stockholder who is present in person
and entitled to vote shall have one vote and on a poll every stockholder
shall have one vote for each share of which he is the registered holder
and may exercise his vote either in person or by proxy.
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11.2 Any person who is not registered as a stockholder but is
entitled to vote at any general meeting in respect of a share, may vote the
share in the same manner as if he were a stockholder; but, unless the
Directors have previously admitted his right to vote at that meeting in
respect of the share, he shall satisfy the Directors of his right to vote the
share before the time for holding the meeting, or adjourned meeting, as
the case may be, at which he proposes to vote.
11.3 Any corporation, not being a subsidiary of the Corporation
which is a stockholder of the Corporation, may by resolution of its
Directors or other governing body authorize any person as it thinks fit to
act as its representative at any general meeting or class meeting. The
person authorized shall be entitled to exercise in respect of and at the
meeting the same powers on behalf of the corporation which he
represents as that corporation could exercise if it were an individual
stockholder of the Corporation personally present, including, without
limitation, the right, unless restricted by the resolution, to appoint a
proxyholder to represent the corporation, and shall be counted for the
purpose of forming a quorum if present at the meeting. Evidence of the
appointment of any representative may be sent to the Corporation by
written instrument, telegram, telex or any method of transmitting legibly
recorded messages. Notwithstanding the foregoing, a corporation being a
stockholder may appoint a proxyholder.
11.4 In the case of joint registered holders of a share, the vote of
the senior who exercises a vote, whether in person or by proxyholder,
shall be accepted to the exclusion of the votes of the other joint
registered holders; and for this purpose seniority shall be determined by
the order in which the names stand in the register of stockholders.
Several legal personal representatives of a deceased stockholder whose
shares are registered in his sole name shall for the purpose of this Bylaw
be deemed joint registered holders.
11.5 A stockholder, in respect of whom an order has been made by
any court having jurisdiction, may vote, whether on a show of hands or
on a poll, by his committee, or other person in the nature of a committee
or curator bonis appointed by that court, and his committee, or other
person may appoint a proxyholder.
11.6 A stockholder holding more than one share in respect of
which he is entitled to vote shall be entitled to appoint one or more (but
not more than five) proxyholders to attend, act and vote for him on the
same occasion. If a stockholder should appoint more than one
proxyholder for the same occasion, he shall specify the number of shares
each proxyholder shall be entitled to vote. A stockholder may also
appoint one or more alternate proxyholders to act in the place and stead
of an absent proxyholder.
11.7 A proxy shall be in writing under the hand of the appointor or
of his attorney duly authorized in writing, or, if the appointor is a
corporation, either under the seal of the corporation or under the hand of
a duly authorized officer or attorney. A proxyholder need not be a
stockholder of the Corporation.
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11.8 Unless the directors otherwise determine, the instrument
appointing a proxyholder and the power of attorney or other authority, if
any, under which it is signed or a notarially certified copy shall be
deposited at a place specified for that purpose in the notice convening
the meeting not less than forty-eight hours before the time for holding
the meeting at which the proxyholder proposes to vote, or shall be
deposited with the Chairman of the meeting prior to the commencement
of the meeting.
11.9 Unless The Act or any other statute or law which is applicable
to the Corporation or to any class of its shares requires any other form of
proxy, a proxy, whether for a specified meeting or otherwise, shall be in
the form following, but may also be in any other form that the Directors
or the chairman of the meeting shall approve:
(Name of Corporation)
The Undersigned, being a stockholder of the above named Corporation,
hereby appoints or failing him
as
proxyholder for the undersigned to attend, act and vote for and on behalf
of the undersigned at the general meeting of the Corporation to be held
on the day of , and at any adjournment thereof.
Signed this _______ day of __________________, 20__.
(Signature of stockholder).
11.10 A vote given in accordance with the terms of a proxy is
valid notwithstanding the previous death or incapacity of the stockholder
giving the proxy or the revocation of the proxy or of the authority under
which the form of proxy was executed or the transfer of the share in
respect of which the proxy is given, provided that no notification in
writing of the death, incapacity, revocation or transfer shall have ben
received at the registered office of the Corporation or by the chairman of
the meeting or adjourned meeting for which the proxy was given before
the vote is taken.
11.11 Every proxy may be revoked by an instrument in writing:
(a) executed by the stockholder giving the same or by his attorney
authorized in writing or, where the stockholder is a corporation, by its
duly authorized officer or attorney of the corporation; and
(b) delivered either at the registered office of the Corporation at
any time up to and including the last business day preceding the day of
the meeting, or any adjournment at which the proxy is to be used, or to
the chairman of the meeting on the day of the meeting or any
adjournment before any vote in respect of which the proxy is to be used
shall have been taken;
or in any other manner provided by law.
11.12 If and for as long as the Corporation shall be a public
corporation and before permitting a registrant to vote on a resolution or
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motion proposed at a meeting of the Corporation, the chairman of the
meeting may require the registrant (or his proxyholder, as the case may
be) to produce evidence in writing acceptable to the chairman (in the
form of a statutory declaration or otherwise) that the registrant:
(a) is the beneficial owner of the share; or
(b) has complied with The Act vis-a-vis the beneficial owner of the
share.
11.13 The provision of this Part shall be applicable mutatis
mutandis to class meetings.
PART 12 - DIRECTORS
12.1 The persons shown on the Certificate of Incorporation are the
first Directors. The Directors to succeed the first Directors may be
appointed in writing by a majority of the incorporators of the
Corporation or if not appointed, they shall be elected by the stockholders
entitled to vote on the election of Directors and the number of Directors
shall be the same as the number of Directors appointed or elected. The
number of Directors, excluding additional Directors, may be fixed or
changed from time to time by ordinary resolution, whether previous
notice has been given or not, but the number of Directors shall never be
less than one or, if the Corporation ceases to be a close corporation, less
than three.
12.2 The remuneration of the Directors as such may from time to
time be determined by the Directors or, if the Directors shall decide, by
the stockholders. The remuneration may be in addition to any salary or
other remuneration paid to any Officer or employee of the Corporation as
such who is also a Director. The Directors shall be repaid reasonable
travelling, hotel and other expenses as they incur in and about the
business of the Corporation and if any Director shall perform any
professional or other services for the Corporation that in the opinion of
the Directors are outside the ordinary duties of a Director or shall
otherwise be specially occupied in or about the Corporation's business,
he may be paid a remuneration to be fixed by the Board, or, at the option
of the Director, by the Corporation in general meeting, and the
remuneration may be either in addition to, or in substitution for any
other remuneration that he may be entitled to receive. The Directors on
behalf of the Corporation, unless otherwise determined by ordinary
resolution, may pay a gratuity or pension or allowance on retirement to
any Director who has held any salaried office or place of profit with the
Corporation or to his spouse or dependents and may make contributions
to any fund and pay premiums for the purchase or provision of any
gratuity, pension or allowance.
12.3 A Director shall not be required to hold a share in the capital
of the Corporation as qualification for his office, but shall be qualified
as required by The Act to become or act as a Director.
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PART 13 - ELECTION AND REMOVAL OF DIRECTORS
13.1 The number of Directors which shall constitute the whole
board shall be determined from time to time by resolution of the board of
directors.
13.2 At each annual general meeting of the Corporation all
Directors shall retire and the stockholders entitled to vote shall elect a
Board of Directors consisting of the number of Directors for the time
being fixed pursuant to these Bylaws. If the Corporation is, or becomes,
a corporation that is a close corporation and the business to be transacted
at any annual general meeting is consented to in writing by the
stockholders who are entitled to attend and vote at this annual general
meeting shall be deemed for the purpose of this Part to have been held on
the written consent becoming effective.
13.3 A retiring Director shall be eligible for re-election.
13.4 Where the Corporation fails to hold an annual general meeting
in accordance with The Act, the Directors then in office shall be deemed
to have been elected or appointed as Directors on the last day on which
the annual general meeting could have been held pursuant to these
Bylaws and they may hold office until other Directors are appointed or
elected or until the day on which the next annual general meeting is held.
13.5 If, at any general meeting at which an election of Directors
ought to take place, the places of the retiring Directors are not filled up,
those of the retiring Directors as may be requested by the newly elected
Directors shall, if willing, continue in office until further new Directors
are elected at a general meeting specially convened for that purpose or at
the annual general meeting in the next or some subsequent year, unless it
is determined to reduce the number of Directors.
13.6 Any casual vacancy occurring in the Board of Directors may
be filled by the remaining Directors or Director.
13.7 Between successive annual general meetings the Directors
shall have power to appoint one or more additional Directors, but only
such number of additional directors as permitted by the Act. Any
Director appointed shall hold office only until the next following annual
general meeting of the Corporation, but shall be eligible for election at
the meeting and so long as he is an additional Director the number of
Directors shall be increased accordingly.
13.8 Any Director may by instrument in writing delivered to the
Corporation appoint any person to be his alternate to act in his place at
meetings of the Directors at which he is not present unless the Directors
shall have reasonably disapproved the appointment of the person as an
alternate Director and shall have given notice to that effect to the
Director appointing the alternate Director within a reasonable time after
delivery of the instrument to the Corporation. Every alternate shall be
entitled to notice of meetings of the Directors and to attend and vote as a
Director at a meeting at which the person appointing him is not
personally present, and, if he is a Director, to have a separate vote on
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behalf of the Director he is representing in addition to his own vote. A
Director may at any time by instrument, telegram, telex or any method of
transmitting legibly recorded messages delivered to the Corporation
revoke the appointment of an alternate appointed by him. The
remuneration payable to an alternate shall be payable out of the
remuneration of the Director appointing him.
13.9 The office of Director shall be vacated if the Director:
(a) resigns his office by notice in writing delivered to the
registered office of the Corporation; or
(b) ceases to be qualified to act as a Director pursuant to The Act.
13.10 The Corporation may by special resolution remove any
Director before the expiration of his period of office, and may appoint
another person in his stead.
PART 14 - POWERS AND DUTIES OF DIRECTORS
14.1 The Directors shall manage, or supervise the management of,
the affairs and business of the Corporation and shall have the authority
to exercise all powers of the Corporation as are not, by The Act or by the
Certificate of Incorporation or these Bylaws, required to be exercised by
the Corporation in a general meeting.
14.2 The Directors may from time to time by power of attorney or
other instrument under the seal, appoint any person to be the attorney of
the Corporation for purposes, and with powers, authorities and
discretions (not exceeding those vested in or exercisable by the Directors
under these Bylaws and excepting the powers of the Directors relating to
the constitution of the Board and of any of its committees and the
appointment or removal of Officers and the power to declare dividends)
and for a period, with remuneration and subject to conditions as the
Directors may think fit, and any appointment may be made in favour of
any of the Directors or any of the stockholders of the Corporation or in
favour of any corporation, or of any of the stockholders, Directors,
nominees or managers of any corporation, firm or joint venture and any
power of attorney may contain provisions for the protection or
convenience of persons dealing with the attorney as the Directors may
think fit. Any attorney may be authorized by the Directors to sub-
delegate all or any of the powers, authorities and discretions for the time
being vested in him.
PART 15 - DISCLOSURE OF INTEREST OF DIRECTORS
15.1 A Director who is, in any way, directly or indirectly
interested in an existing or proposed contract or transaction with the
Corporation or who holds any office or possesses any property, directly
or indirectly, where a duty or interest might be created to conflict with
his duty or interest as a Director, shall declare the nature and extent of
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his interest in the contract or transaction or of the conflict or potential
conflict with his duty and interest as a Director in accordance with the
provisions of The Act.
15.2 A Director shall not vote in respect of the approval of any
contract or transaction with the Corporation in which he is interested and
if he shall do so his vote shall not be counted, but he shall be counted in
the quorum present at the meeting at which the vote is taken. This Bylaw
and Bylaw 15.1 shall not apply in circumstances where a Director is,
under the provisions of The Act, deemed not to be interested in a
proposed contract or transaction.
15.3 A Director may hold any office or place of profit with the
Corporation (other than the office of auditor of the Corporation) in
conjunction with his office of Director for a period and on terms (as to
remuneration or otherwise) as the Directors may determine and no
Director or intended Director shall be disqualified by his office from
contracting with the Corporation either with regard to his tenure of any
other office or place of profit or as vendor, purchaser or otherwise, and,
subject to compliance with the provisions of The Act, no contract or
transaction entered into by or on behalf of the Corporation in which a
Director is in any way interested shall be liable to be voided by reason
thereof.
15.4 Subject to compliance with the provisions of The Act, a
Director or his firm may act in a professional capacity for the
Corporation (except as auditor of the Corporation) and he or his firm
shall be entitled to remuneration for professional services as if he were
not a Director.
15.5 A Director may be or become a Director or other Officer or
employee of, or otherwise interested in, any corporation or firm in which
the Corporation may be interested as a stockholder or otherwise, and,
subject to compliance with the provisions of The Act, the Director shall
not be accountable to the Corporation for any remuneration or other
benefits received by him as Director, Officer or employee of, or from his
interest in, such other corporation or firm, unless the Corporation in a
general meeting otherwise directs.
PART 16 - PROCEEDINGS OF DIRECTORS
16.1 The Chairman of the Board, if any, or in his absence, the
President, shall preside as chairman at every meeting of the Directors, or
if there is no Chairman of the board or neither the Chairman of the Board
nor the President is present within fifteen minutes of the time appointed
for holding the meeting or is willing to act as chairman, or, if the
Chairman of the Board, if any, and the President have advised the
Secretary that they will not be present at the meeting, the Directors
present shall choose one of their number to be chairman of the meeting.
16.2 The Directors may meet together for the dispatch of business,
adjourn and otherwise regulate their meetings, as they think fit.
Questions arising at any meeting shall be decided by a majority of votes.
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In case of an equality of votes the chairman shall not have a second or
casting vote. Meetings of the Board held at regular intervals may be held
at a place, at a time and upon notice (if any) as the Board may by
resolution from time to time determine.
16.3 A Director may participate in a meeting of the Board or of
any committee of the Directors by means of conference telephones or
other communication facilities by means of which all Directors
participating in the meeting can hear each other. A Director participating
in a meeting in accordance with this Bylaw shall be deemed to be present
at the meeting, to have agreed, shall be counted in the quorum and be
entitled to speak and vote.
16.4 A Director may at any time, and the Secretary, upon the
written request of a Director, shall call a meeting of the Directors.
Notice specifying the time and place of the meeting shall be mailed,
postage prepaid, addressed to each of the Directors at his registered
address at least 48 hours before the time fixed for the meeting or a lesser
period as may be reasonable under the circumstances, or the notice may
be given to each Director either personally or by leaving it at his usual
business or residential address or by telephone, telegram, telex or other
method of transmitting visually recorded messages, at least 48 hours
before the time or the lesser period as may be reasonable under the
circumstances. It shall not be necessary to give to any Director notice of
a meeting of Directors immediately following a general meeting at which
the Director has been elected or notice of a meeting of Directors at which
the Director shall have been appointed. Accidental omission to give
notice of a meeting of Directors to, or the non-receipt of notice by, any
Director, shall not invalidate the proceedings at that meeting.
16.5 Any Director of the Corporation may file with the Secretary a
document executed by him waiving notice of any past, present or future
meeting or meetings of the Directors being, or required to have been,
sent to him and may at any time withdraw the waiver with respect to
future meetings. After filing the waiver with respect to future meetings
and until the waiver is withdrawn no notice need be given to the Director
and, unless the Director otherwise requires in writing to the Secretary, to
his alternate Director of any meeting of Directors and all meetings of the
Directors held shall be deemed to be properly called or constituted even
though notice was given to the Director or alternate Director.
16.6 The quorum necessary for the transaction of the business of
the Directors may be fixed by the Directors and if not fixed shall be two
Directors or, if the number of Directors is fixed at one, shall be one
Director.
16.7 The continuing Directors may act notwithstanding any
vacancy in their body, but, if and so long as their number is reduced
below the number fixed pursuant to these Bylaws as the necessary
quorum of Directors, the continuing Directors may act for the purpose of
increasing the number of Directors to that number, or of summoning a
general meeting of the Corporation, but for no other purpose.
16.8 Subject to the provisions of The Act, all acts done by any
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meeting of the Directors or of a committee of Directors, or by any person
acting as a Director, shall, notwithstanding that it be afterwards
discovered that there was some defect in the qualification, election or
appointment of any Directors or of the stockholders of a committee or
person acting as aforesaid, or that they or any of them were disqualified,
be as valid as if every person had been duly elected or appointed and was
qualified to be a Director.
16.9 A resolution consented to in writing, whether by document,
telegram, telex or any method of transmitting legibly recorded messages r
other means, by all of the Directors shall be as valid and effectual as if it
had been passed at a meeting of the Directors duly called and held. A
resolution shall be dated and may be in two or more counterparts which
together shall be deemed to constitute one resolution in writing. The
resolution shall be filed with the minutes of the proceedings of the
Directors and shall be effective on the date stated on the resolution or on
the latest date stated on any counterpart.
PART 17 - EXECUTIVE AND OTHER COMMITTEES
17.1 The Directors may by resolution appoint an Executive
Committee to consist of a member or members of their body as they think
fit, which committee shall have, and may exercise during the intervals
between the meetings of the Board, all the powers vested in the Board
except the power to fill vacancies in the Board, the power to change the
membership of, or fill vacancies in, the Committee or any other
committees of the Board and any other powers as may be specified in the
resolution. The Committee shall keep regular minutes of its transactions
and shall cause them to be recorded in books kept for that purpose, and
shall report the same to the Board of Directors at times as the Board of
Directors may from time to time require. The Board shall have the power
at any time to revoke or override the authority given to or acts done by
the Committee except as to acts done before such revocation or
overriding and to terminate the appointment or change the membership of
the Committee and to fill vacancies in it. The Committee may make rules
for the conduct of its business and may appoint assistants as it may deem
necessary. A majority of the members of the Committee shall constitute a
quorum.
17.2 The Directors may by resolution appoint one or more
committees consisting of a member or members of their body as they
think fit and may delegate to any committee between meetings of the
Board those powers of the Board (except the power to fill vacancies in
the Board and the power to change the membership of or fill vacancies in
any committee of the Board and the power to appoint or remove Officers
appointed by the Board) subject to conditions as may be prescribed in the
resolution, and all committees appointed shall keep regular minutes of
their transactions and shall cause them to be recorded in books kept for
that purpose, and shall report to the Board of Directors as the Board of
Directors may from time to time require. The Directors shall also have
power at any time to revoke or override any authority given to or acts to
be done by any committees except as to acts done before such revocation
or overriding and to terminate the appointment or change the membership
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of a committee and to fill vacancies in it. Committees may make rules for
the conduct of their business and may appoint assistants as they deem
necessary. A majority of the members of a committee shall constitute a
quorum.
17.3 The Executive Committee and any other committees may meet
and adjourn as it thinks proper. Questions arising at any meeting shall be
determined by a majority of votes of the members of the committee
present, and in case of an equality of votes, the chairman shall not have a
second or casting vote. A resolution approved in writing by all the
members of the Executive Committee or any other committee shall be as
valid and effective as if it had been passed at a meeting of the Committee
duly called and constituted. A resolution shall be dated and may be in
two or more counterparts which together shall be deemed to constitute
one resolution in writing. The resolution shall be filed with the minutes
of the proceedings of the committee and shall be effective on the date
stated on the resolution or on the latest date stated in any counterpart.
PART 18 - OFFICERS
18.1 The Directors shall, from time to time, appoint a President
and a Secretary and any other officers as the Directors shall determine
and the Directors may, at any time, terminate any appointment. No
officer shall be appointed unless he is qualified in accordance with the
provisions of The Act.
18.2 One person may hold more than one of the offices. Any
person appointed as the Chairman of the Board, the President or the
Managing Director shall be a Director. The other officers need not be
Directors. The remuneration of the officers of the Corporation as such
and the terms and conditions of their tenure of office or employment
shall from time to time be determined by the Directors; the remuneration
may be by way of salary, fees, wages, commission or participation in
profits or any other means or all of these modes and an officer may in
addition to the remuneration be entitled to receive after he ceases to hold
the office or leaves the employment of the Corporation a pension or
gratuity. The Directors may decide what functions and duties each officer
shall perform and may entrust to and confer upon him any of the powers
exercisable by them upon terms and conditions and with restrictions as
they think fit and may from time to time revoke, withdraw, alter or vary
all or any of the functions, duties and powers. The Secretary shall, inter
alia, perform the functions of the Secretary specified in the Act.
18.3 Every officer of the Corporation who holds any office or
possesses any property, whether directly or indirectly, where duties or
interest might be created in conflict with his duties or interests as an
officer of the Corporation shall, in writing, disclose to the President the
fact and the nature and extent of the conflict.
PART 19 - INDEMNITY AND PROTECTION
OF DIRECTORS, OFFICERS AND EMPLOYEES
19.1 Subject to the provisions of The Act, the Directors shall
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cause the Corporation to indemnify a Director or former Director of the
Corporation and the Directors may cause the Corporation to indemnify a
director or former director of a corporation of which the Corporation is
or was a stockholder and the heirs and personal representatives of any
former director against all costs, charges and expenses, including an
amount paid to settle an action or satisfy a judgment, actually and
reasonably incurred by him or them including an amount paid to settle an
action or satisfy a judgment in a civil, criminal or administrative action
or proceeding to which he is or they are made a party by reason of his
being or having been a Director including any action brought by the
Corporation. Each Director of the Corporation on being elected or
appointed shall be deemed to have contracted with the Corporation on the
terms of this indemnity.
19.2 Subject to the provisions of The Act, the Directors may cause
the Corporation to indemnify any officer, employee or agent of the
Corporation or of a corporation of which the Corporation is or was a
stockholder (notwithstanding that he is also a Director) and his heirs and
personal representatives against all costs, charges and expenses
whatsoever incurred by him or them and resulting from his acting as an
officer, employee or agent of the Corporation or the corporation. In
addition, the Corporation shall indemnify the Secretary or an Assistant
Secretary of the Corporation (if he shall not be a full time employee of
the Corporation and notwithstanding that he is also a Director) and his
respective heirs and legal representatives against all costs, charges and
expenses whatsoever incurred by him or them and arising out of the
functions assigned to the Secretary by The Act or these Bylaws.
19.3 The failure of a Director or officer of the Corporation to
comply with the provisions of The Act or of the Certificate of
Incorporation or these Bylaws shall not invalidate any indemnity to
which he is entitled under this Part.
19.4 The Directors may cause the Corporation to purchase and
maintain insurance for the benefit of any person who is or was serving as
a Director, officer, employee or agent of the Corporation or as a director,
officer, employee or agent of any corporation of which the Corporation is
or was a stockholder and his heirs or personal representatives against any
liability incurred by him as a Director, officer, employee or agent.
PART 20 - DIVIDENDS AND RESERVE
20.1 The Directors may from time to time declare and authorize
payment of dividends as they may deem advisable and need not give
notice to any stockholder. No dividend shall be paid otherwise than out
of funds or assets properly available for the payment of dividends and a
declaration by the Directors as to the amount of the funds or assets
available for dividends shall be conclusive. The Corporation may pay any
such dividend wholly or in part by the distribution of specific assets and
in particular by paid up shares, bonds, debentures or other securities of
the Corporation or any other corporation or in any one or more ways as
may be authorized by the Corporation or the Directors and where any
difficulty arises with regard to a distribution the Directors may settle the
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difficulty as they think expedient, and in particular may fix the value for
distribution of the specific assets or any part, and may determine that
cash payments in substitution for all or any part of the specific assets to
which any stockholders are entitled shall be made to any stockholders on
the basis of the value fixed in order to adjust the rights of all parties and
may vest any specific assets in trustees for the persons entitled to the
dividend as may seem expedient to the Directors.
20.2 Any dividend declared on shares of any class by the Directors
may be made payable on a date as is fixed by the Directors.
20.3 Subject to the rights of stockholders holding shares with
special rights as to dividends, all dividends on shares of any class shall
be declared and paid according to the number of shares held.
20.4 The Directors may, before declaring any dividend, set aside
out of the funds properly available for the payment of dividends a sum as
they think proper as a reserve which shall, at the discretion of the
Directors, be applicable for meeting contingencies, or for equalizing
dividends, or for any other purpose to which the funds of the Corporation
may be properly applied, and pending the application may, at the like
discretion, either be employed in the business of the Corporation or be
invested in investments as the Directors may from time to time think fit.
The Directors may also, without placing the same in reserve, carry
forward such funds, which they think prudent not to distribute.
20.5 If several persons are registered as joint holders of any share,
any one of them may give an effective receipt for any dividend, bonus or
other money payable in respect of the share.
20.6 No dividend shall bear interest against the Corporation.
Where the dividend to which a stockholder is entitled includes a fraction
of a cent, such fraction shall be disregarded in making payment and the
payment shall be deemed to be payment in full.
20.7 Any dividend, bonus or other money payable in cash in
respect of shares may be paid by cheque or money order sent through the
post directed to the registered address of the holder, or in the case of
joint holders, to the registered address of that one of the joint holders
who is first named on the register, or to a person and to an address as the
holder or joint holders may direct in writing. Every cheque or money
order shall be made payable to the order of the person to whom it is sent.
The mailing of the cheque or money order shall, to the extent of the sum
represented thereby (plus the amount of any tax required by law to be
deducted), discharge all liability for the dividend, unless the cheque or
money order shall not be paid on presentation or the amount of tax
deducted shall not be paid to the appropriate taxing authority.
20.8 Notwithstanding anything contained in these Bylaws, the
Directors may from time to time capitalize any undistributed surplus on
hand of the Corporation and may from time to time issue as fully paid
and non-assessable any unissued shares, or any bonds, debentures or debt
obligations of the Corporation as a dividend representing all or any part
of the undistributed surplus on hand.
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PART 21 - DOCUMENTS, RECORDS AND REPORTS
21.1 The Corporation shall keep at its registered office or at any
other place as The Act may permit, the documents, copies, registers,
minutes, and records which the Corporation is required by The Act to
keep at its registered office or any other place, as the case may be.
21.2 The Corporation shall cause to be kept proper books of
account and accounting records in respect of all financial and other
transactions of the Corporation in order to record the financial affairs
and condition of the Corporation and to comply with The Act.
21.3 Unless the Directors determine otherwise, or unless otherwise
determined by an ordinary resolution, no stockholder of the Corporation
shall be entitled to inspect the accounting records of the Corporation.
21.4 The Directors shall from time to time at the expense of the
Corporation cause to be prepared and laid before the Corporation in
general meeting the financial statements and reports as are required by
The Act.
21.5 Every stockholder shall be entitled to be furnished, once,
gratis, on demand, with a copy of the latest annual financial statements
of the Corporation and, if so required by The Act, a copy of each annual
financial statement and interim financial statement shall be mailed to
each stockholder.
PART 22 - NOTICES
22.1 A notice, statement or report may be given or delivered by the
Corporation to any stockholder either by delivery to him personally or by
sending it by mail to him to his address as recorded in the register of
stockholders. Where a notice, statement or report is sent by mail, service
or delivery of the notice, statement or report shall be deemed to be
effected by properly addressing, prepaying and mailing the notice,
statement or report and to have been given on the day, Saturdays,
Sundays and holidays excepted, following the date of mailing. A
certificate signed by the secretary or other officer of the Corporation or
of any other corporation acting in that behalf for the Corporation that the
letter or envelope containing the notice, statement or report was
addressed, prepaid and mailed shall be conclusive evidence of mailing.
22.2 A notice, statement or report may be given or delivered by the
Corporation to the joint holders of a share by giving the notice to the
joint holder first named in the register of stockholders in respect of the
share.
22.3 A notice, statement or report may be given or delivered by the
Corporation to the persons entitled to a share in consequence of the
death, bankruptcy or incapacity of a stockholder by sending it through
the mail prepaid addressed to them by name or by the title of
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representatives of the deceased or incapacitated person or trustee of the
bankrupt, or by any like description, at the address (if any) supplied to
the Corporation for the purpose by the persons claiming to be entitled, or
(until the address has been supplied) by giving the notice in a manner in
which the same might have been given if the death, bankruptcy or
incapacity had not occurred.
22.4 Notice of every general meeting or meeting of stockholders
holding a class of shares shall be given to every stockholder.
PART 23 - RECORD DATES
23.1 The Directors may fix in advance a date, which shall not be
more than the maximum number of days permitted by The Act preceding
the date of any meeting of stockholders or any class or of the payment of
any dividend or of the proposed taking of any other proper action
requiring the determination of stockholders as the record date for the
determination of the stockholders entitled to notice of, or to attend and
vote at, any meeting and any adjournment, or entitled to receive payment
of any dividend or for any other proper purpose and, in such case,
notwithstanding anything elsewhere contained in these Bylaws, only
stockholders of record on the date fixed shall be deemed to be
stockholders for the purposes aforesaid.
23.2 Where no record date is fixed for the determination of
stockholders, the date on which the notice is mailed or on which the
resolution declaring the dividend is adopted, as the case may be, shall be
the record date for such determination.
PART 24 - SEAL
24.1 The Directors may provide a seal for the Corporation and
shall provide for the safe custody of the seal which shall not be affixed
to any instrument except in the presence of a Director or a person or
persons as the Directors may from time to time by resolution appoint and
the Director, or person or persons in whose presence the seal is so
affixed to an instrument shall sign such instrument. For the purpose of
certifying under seal true copies of any document or resolution the seal
may be affixed in the presence of any Director or Officer.
24.2 To enable the seal of the Corporation to be affixed to any
bonds, debentures, share certificates, or other securities of the
Corporation on which facsimiles of any of the signatures of the Directors
or officers of the Corporation are, in accordance with The Act and these
Bylaws printed or otherwise mechanically reproduced, there may be
delivered to the firm or Corporation employed to engrave, lithograph or
print the bonds, debentures, share certificates or other securities one or
more unmounted dies reproducing the Corporation's seal and the
Chairman of the Board, the President, the Managing Director or a Vice-
President and the Secretary, Treasurer, Secretary-Treasurer, a Assistant
Secretary, an Assistant Treasurer, or an Assistant Secretary-Treasurer
may by a document authorize the firm or Corporation to cause the
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Corporation's seal to be affixed to the bonds, debentures, share
certificates or other securities by the use of the dies. Bonds, debentures,
share certificates or other securities to which the Corporation's seal has
been affixed shall for all purposes be deemed to be under and to bear the
Corporation's seal lawfully affixed.
24.3 The Corporation may have for use in any other province,
state, territory or country an official seal which shall have on its face the
name of the Province, State, Territory or Country where it is to be used.
PART 25 - DEATH OF SOLE DIRECTOR AND STOCKHOLDER
25.1 In the event that the Corporation has only one stockholder
(exclusive of the Corporation, if the Corporation shall be the owner of
issued shares of the Corporation), and if the stockholder is the only
Director of the Corporation, then he may from time to time file at the
registered office of the Corporation a notice in writing designating one
or more persons to act as Directors in the event of his death. The notice
shall be accompanied by the written consent of the designated persons to
act as and to be Directors of the Corporation. Upon the death of the
Director (and provided that at the date of the death no other person is a
stockholder of the Corporation and no other person is a Director of the
Corporation), each person designated as a Director as aforesaid shall be
deemed to have been duly elected as a Director of the Corporation as of
the date of death of such deceased director; provided, however, that the
election or appointment of a person designated as aforesaid shall be
invalid and of no effect in the event of his rescinding his consent to be
or to act as a Director or in the event of his being disqualified from
being or acting as a Director.
25.2 In the event that a sole Director fails to appoint a successor
pursuant to Bylaw 25.1 (or having designated a person pursuant to Bylaw
25.1, the person fails or refuses to act as a Director or is otherwise
disqualified from acting as or being a Director, and in the event of the
death of the Director at a time when he is still the sole stockholder of the
Corporation (exclusive of the Corporation, if the Corporation shall be the
owner of issued shares of the Corporation):
(a) A general meeting of the Corporation may be convened by:
i) the solicitor or auditor for the Corporation; or
ii) any person entitled as at the intended date of the meeting to
apply for Letters Probate of the last Will of the deceased stockholder (if
he died testate); or
iii) the person first entitled as at the intended date of the
meeting to apply for Letters of Administration of the estate of the
deceased stockholder (whether or not he in fact died intestate);
(b) Notice of such meeting shall be given no less than twenty-one
days before the intended date of the meeting to:
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i) all persons named as beneficiaries in the last will (if any)
of the deceased stockholder (whether or not letters probate have been
granted in respect of such Will);
ii) all persons who would be entitled to share in the estate of
the deceased stockholder if he had died intestate (whether or not he in
fact died intestate);
iii) the parent or guardian of any person referred to in i) or
ii) above who is an infant as at the intended date of the meeting; and
iv) if any of the persons referred to in i) or ii) above shall be
a
class of persons whose identity cannot be readily ascertained, then to a
solicitor acting on behalf of the class;
(c) At the general meeting, the persons named in (b) above who are
personally present at the meeting shall be entitled, upon unanimous vote,
to determine the number of Directors of the Corporation and to elect
Directors of the Corporation;
(d) The persons elected Directors of the Corporation pursuant to
this Bylaw 25.2 shall have authority to manage the business of the
Corporation; but, while the persons are Directors of the Corporation,
they shall not suffer nor permit any of the following until at least one
hundred and twenty days following the transmission of the shares of the
deceased stockholder to his lawful representative (having Letters Probate
or Letters of Administration) without first obtaining a Court Order
approving the same:
i) the sale, allotment or issuance by the Corporation of any
issued or unissued shares;
ii) the issuance by the Corporation of any bonds, debentures,
warrants or options to purchase shares;
iii) any agreement by the Corporation to allot or issue shares,
debentures, warrants or options to purchase shares (whether issued or
unissued);
iv) the purchase or redemption by the Corporation of any of its
shares or any agreement by the Corporation to purchase or redeem any of
its shares;
v) the alteration of the Corporation's Certificate of
Incorporation or Bylaws; or
vi) the sale by the Corporation of the whole or a substantial
part of its business or undertaking.
25.3 The provisions of Bylaws 25.1 and 25.2 shall apply mutatis
mutandis in the event of there being more than one Director and
stockholder and in the event of the death of all stockholders and
Directors without other provision having been made for the appointment
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of successor Directors.
25.4 The accidental omission to give notice to a person specified
in Bylaw 25.2(b) shall not invalidate the election of Directors pursuant
to Bylaw 25.2(c).
PART 26 - PROHIBITIONS
26.1 If the Corporation is a close corporation, no shares or debt
obligations issued by the Corporation shall be offered for sale to the
public.
26.2 If the Corporation is a close corporation, no shares shall be
transferred without the previous consent of the Directors expressed by a
resolution of the Board and the Directors shall not be required to give
any reason for refusing to consent to any proposed transfer.
