SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-Q
Quarterly Report Under Section 13 and 15 (d)
of the Securities Exchange Act of 1934
For the quarter ended September 30, 1995
Commission file number 1-10184
ABATIX ENVIRONMENTAL CORP.
(Exact name of registrant as specified in its charter)
DELAWARE 75-1908110
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification number)
8311 EASTPOINT DRIVE, SUITE 400
DALLAS, TEXAS 75227
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (214) 381-1146
Indicate by check mark whether the Registrant: (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding twelve months (or for such shorter period that the
Registrant was required to file such reports) and (2) has been subject to
such filing requirements for the past 90 days.
Yes X No
Common stock outstanding at October 20, 1995 was 2,161,814 shares.
<PAGE>
ABATIX ENVIRONMENTAL CORP. AND SUBSIDIARY
Consolidated Balance Sheets
(Unaudited)
<TABLE>
<CAPTION>
September 30, December 31,
1995 1994
------------- ------------
<S> <C> <C>
ASSETS
Current assets:
Cash $ 199,332 $ 150,727
Trade accounts receivable net of
allowance for doubtful accounts of $292,604
in 1995 and $163,233 in 1994 4,849,523 4,428,853
Inventories 2,836,544 2,398,252
Prepaid expenses and other current assets 149,583 210,585
Deferred income taxes 150,805 146,205
Net asset of discontinued operations - 91,249
------------ ------------
Total current assets 8,185,787 7,425,871
Receivables from officers and employees 64,979 58,685
Property and equipment, net 564,528 677,431
Other assets 25,617 21,936
------------ ------------
$ 8,840,911 $ 8,183,923
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Notes payable to bank $ 2,606,054 $ 2,919,718
Accounts payable 1,165,674 792,663
Net liability of discontinued operations 97,002 -
Other accrued expenses and current liabilities 741,739 496,701
------------ ------------
Total current liabilities 4,610,469 4,209,082
Deferred income taxes 38,390 74,005
------------ ------------
Total liabilities 4,648,859 4,283,087
------------ ------------
Stockholders' equity:
Preferred stock - $1 par value, 2,000,000
shares authorized; none issued - -
Common stock - $.001 par value, 20,000,000
shares authorized; issued 2,341,314 shares
in 1995 and 2,319,748 shares in 1994 2,341 2,320
Additional paid-in capital 2,305,143 2,279,653
Retained earnings 2,341,045 1,674,461
Less cost of 179,500 common shares in
treasury in 1995 and 26,500 common
shares in treasury in 1994 (456,477) (55,598)
------------ ------------
Total stockholders' equity 4,192,052 3,900,836
------------ ------------
Commitments
------------ ------------
$ 8,840,911 $ 8,183,923
============ ============
2
</TABLE>
See accompanying notes to consolidated financial statements.
<PAGE>
ABATIX ENVIRONMENTAL CORP. AND SUBSIDIARY
Consolidated Statements of Operations
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
September 30, September 30,
------------------------ --------------------------
1995 1994 1995 1994
----------- ----------- ------------ ------------
<S> <C> <C> <C> <C>
Net sales $ 7,129,372 $ 6,981,679 $ 20,831,377 $ 19,911,239
Cost of sales 5,079,693 5,112,952 14,785,132 14,496,773
----------- ----------- ------------ ------------
Gross profit 2,049,679 1,868,727 6,046,245 5,414,466
Selling, general and
administrative expenses 1,618,609 1,475,714 4,660,178 4,495,287
Special charge 80,000 - 80,000 -
----------- ----------- ------------ ------------
Earnings from operations 351,070 393,013 1,306,067 919,179
Other income (expense):
Interest expense (74,847) (83,779) (204,573) (201,519)
Interest income
and other, net 11,779 17 22,215 7,507
----------- ----------- ------------ ------------
Earnings from continuing
operations before
income taxes 288,002 309,251 1,123,709 725,167
Income tax expense 97,780 123,700 457,125 290,066
----------- ----------- ------------ ------------
Earnings from
continuing operations 190,222 185,551 666,584 435,101
Discontinued operations:
Loss from discontinued
operations, net of tax
benefit of $18,496 and
$65,418 for the three
and nine months ended
September 30, 1994,
respectively - (25,970) - (119,384)
----------- ----------- ------------ ------------
Net earnings $ 190,222 $ 159,581 $ 666,584 $ 315,717
=========== =========== ============ ============
Earnings per common and common equivalent share:
Earnings from
continuing operations $ .09 $ .08 $ .30 $ .19
Loss from
discontinued operations - (.01) - (.05)
---------- ----------- ------------ ------------
Net earnings $ .09 $ .07 $ .30 $ .14
========== =========== ============ ============
Weighted average common
and common equivalent
shares outstanding 2,208,440 2,337,249 2,216,076 2,332,805
========== =========== ============ ============
</TABLE>
See accompanying notes to consolidated financial statements.
3
<PAGE>
ABATIX ENVIRONMENTAL CORP. AND SUBSIDIARY
Consolidated Statements of Cash Flows
(Unaudited)
<TABLE>
<CAPTION>
Nine Months Ended
SEPTEMBER 30,
1995 1994
------------ ------------
<S> <C> <C>
Cash flows from operating activities:
Net earnings $ 666,584 $ 315,717
Adjustments to reconcile net earnings to net
cash provided by (used in) operating activities:
Depreciation and amortization 250,042 223,457
Deferred income taxes, net (40,215) 1,948
Gain on disposal of assets (11,615) (2,875)
Changes in assets and liabilities:
Receivables (420,670) (2,013,866)
Inventories (438,292) (468,187)
Refundable income taxes - 236,236
Prepaid expenses and other 61,002 (22,996)
Net asset/liability of discontinued operations 147,807 25,228
Accounts payable 373,011 487,294
Other accrued expenses and current liabilities 249,757 184,102
------------ ------------
Net cash provided by (used in) operating activities 837,411 (1,033,942)
------------ ------------
Cash flows from investing activities:
Purchase of property and equipment (135,014) (324,248)
Proceeds from sale of property and equipment 49,934 11,048
Advances to officers and employees (31,359) (25,147)
Collection of advances to officers and employees 25,065 7,468
Other net assets (3,681) (2,000)
------------ ------------
Net cash used in investing activities (95,055) (332,879)
------------ ------------
Cash flows from financing activities:
Exercise of stock options and warrants 25,511 117,505
Purchase of treasury stock (400,879) -
Net (repayments) borrowings
on notes payable to bank (313,664) 1,130,792
Principal payments on capital lease obligations (4,719) (130)
------------ ------------
Net cash (used in) provided
by financing activities (693,751) 1,248,167
------------ ------------
Net increase (decrease) in cash 48,605 (118,654)
Cash at beginning of period 150,727 172,186
------------ ------------
Cash at end of period $ 199,332 $ 53,532
============ ============
Supplemental disclosure information:
Cash paid during the period for: Interest $ 207,142 $ 208,211
Income taxes $ 430,123 $ 87,500
</TABLE>
See accompanying notes to consolidted financial statements.
4
<PAGE>
ABATIX ENVIRONMENTAL CORP. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
(1) BASIS OF PRESENTATION, GENERAL AND BUSINESS
Abatix Environmental Corp. ("Abatix") and its wholly owned subsidiary,
International Enviroguard Systems, Inc. ("IESI"), collectively the "Company",
market and distribute personal protection and safety equipment and durable
and nondurable supplies to the asbestos and lead abatement, industrial
safety, hazardous materials, and construction tool industries. The Company,
through IESI, imports certain products sold primarily through the Company's
distribution system. The sorbent manufacturing business of IESI was
discontinued in December 1994 (see note 2).
The accompanying consolidated financial statements are prepared in accordance
with the instructions to Form 10-Q, are unaudited and do not include all the
information and disclosures required by generally accepted accounting
principles for complete financial statements. All adjustments that, in the
opinion of management, are necessary for a fair presentation of the results
of operations for the interim periods have been made and are of a recurring
nature unless otherwise disclosed herein. Certain amounts have been
reclassified for consistency in presentation. The results of operations for
such interim periods are not necessarily indicative of results of operations
for a full year.
(2) DISCONTINUED OPERATIONS
In December 1994, the Company announced the discontinuance of the sorbent
manufacturing business of IESI, which was completed by September 30, 1995.
The remaining asset is the accounts receivable and the remaining liability is
the reserve related to the discontinuance. The balance of this reserve
exists primarily to cover the remaining costs associated with the facility
lease, which expires September 1999. Actual costs through September 30, 1995
approximated management's December 1994 estimates. Sales of sorbents were
$8,000 and $123,000 for the three months ended September 30, 1995 and 1994,
respectively, and $116,000 and $330,000 for the nine months ended
September 30, 1995 and 1994, respectively.
(3) STOCKHOLDERS' EQUITY
In February 1995, the Board of Directors of the Company approved a repurchase
of up to 110,000 shares of the Company's common stock. In May and July 1995,
the Company repurchased 13,000 and 50,000 shares of common stock,
respectively. Since November 1994, the Company has purchased 179,500 shares
for treasury stock.
Effective October 6, 1995, the Company amended its Certificate of
Incorporation, thereby reducing its authorized capital stock. The authorized
preferred stock has been reduced from 2,000,000 shares to 500,000 shares and
the authorized common stock has been reduced from 20,000,000 shares to
5,000,000 shares. This reduction in authorized capital stock will result in
franchise tax savings without impairing the Company's ability to raise
capital, if needed, through the equity markets.
5
<PAGE>
(4) SPECIAL CHARGE
Effective September 1, 1995, the Company closed its sales/distribution center
in Corpus Christi, Texas. This branch office was opened June 1, 1994.
Associated with this closing, the Company recorded an $80,000 pretax charge
to operations. This charge primarily includes costs related to future lease
commitments.
The Company has an option to purchase the building it is currently leasing,
at a price believed to be favorable to the building's current market price.
The Company, through a real estate broker, is actively marketing this
property. If the property is sold or subleased to a third party, the Company
would be able to partially recover the charges associated with the future
lease commitments.
Sales for the Corpus Christi branch were $67,000 and $44,000 for the three
months ended September 30, 1995 and 1994, respectively, and $294,000 and
$59,000 for the nine months ended September 30, 1995 and 1994, respectively.
The Corpus Christi branch had operating losses of $31,000 and $12,000 for the
third quarters 1995 and 1994, respectively, and operating losses of $56,000
and $16,000 for the nine months ended September 30, 1995 and 1994,
respectively.
6
<PAGE>
ABATIX ENVIRONMENTAL CORP. AND SUBSIDIARY
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
THREE MONTH PERIOD ENDED SEPTEMBER 30, 1995 COMPARED TO THREE MONTH PERIOD
ENDED SEPTEMBER 30, 1994.
RESULTS OF CONTINUING OPERATIONS
Net sales of $7,129,000 for the three months ended September 30, 1995,
increased 2% or $148,000 over the same period in 1994.
Gross profit of 29% of sales for the three month period ended September 30,
1995, increased from 27% for the same period in 1994. This increase is
primarily attributable to improved pricing as a result of enhanced customer
service.
Selling, general and administrative expenses of $1,619,000 for the three
month period ended September 30, 1995, increased 10% or $143,000 over the
same period in 1994. The increase was attributable to higher selling
expenses resulting from increased gross profit. Selling, general and
administrative expenses for 1995 were 23% of sales compared to 21% of sales
for 1994.
The company recorded a pretax special charge of $80,000 in the three month
period ended September 30, 1995 to account for the costs associated with
closing the Corpus Christi, Texas sales/distribution facility. The charge
primarily includes estimated costs related to future lease commitments.
Interest expense of $75,000 decreased 11% from 1994 expense of $84,000. This
decrease is primarily due to a decrease in borrowings, partially offset by an
increase in the interest rate. The Company's credit facilities are variable
rate notes tied to the Company's lending institution's prime rate. Increases
in the prime rate could negatively affect the Company's earnings. In late
September, the Company negotiated a one-half of one percent reduction in its
borrowing rate on all of its credit facilities. Interest income and other,
net of $12,000 consists primarily of gains on the sale of assets.
DISCONTINUED OPERATIONS
See Note 2 to the consolidated financial statements.
7
<PAGE>
NET RESULTS
Net earnings for the three months ended September 30, 1995 of $190,000 or
$.09 per share increased $30,000 from net earnings of $160,000 or $.07 per
share for the same period in 1994. The 19% increase in net earnings is
primarily due to higher sales and product margins, partially offset by the
impact of the special charge and higher selling, general and administrative
expenses.
NINE MONTH PERIOD ENDED SEPTEMBER 30, 1995 COMPARED TO NINE MONTH PERIOD
ENDED SEPTEMBER 30, 1994.
RESULTS OF CONTINUING OPERATIONS
Net sales from continuing operations for the nine months ended September 30,
1995 increased 5% or $920,000 to $20,831,000 from $19,911,000 in 1994. The
increase is primarily a result of increased market share in several markets,
partially offset by less demand for asbestos abatement products in certain
locations.
The Company intends to continue serving the asbestos abatement market and to
continue diversifying revenues in all markets with hazardous material
remediation, industrial product and construction tool sales. Efforts to
further expand and diversify revenues without sacrificing product margins
should provide the foundation for continuing profitability in 1995 and 1996.
Gross profit for the nine month period ended September 30, 1995 increased
from 27% to 29% over 1994. This increase is primarily attributable to
improved sales pricing as a result of enhanced customer service.
Selling, general and administrative expenses of $4,660,000 for the nine month
period ended September 30, 1995, increased 4% or $165,000 over the same
period in 1994. The increase was attributable to higher selling expenses
resulting from increased gross profit. Selling, general and administrative
expenses for 1995 were 22% of sales compared to 23% of sales for 1994. These
expenses are estimated to increase slightly in the fourth quarter of 1995
primarily because revenues from the Las Vegas location (scheduled to open in
mid-November) are expected to lag behind the start-up expenses.
The Company recorded a special charge of $80,000 in the third quarter 1995 to
account for the costs associated with closing the Corpus Christi branch.
Interest expense of $205,000 increased slightly over 1994 expense of
$202,000. The increases in prime rate in early 1995 have been mostly offset
by a decrease in borrowings. In late September, the Company negotiated a
one-half of one percent reduction in its borrowing rate on all of its credit
facilities. Interest income and other, net of $22,000 consists primarily of
gains on the sale of assets.
8
<PAGE>
DISCONTINUED OPERATIONS
See Note 2 to the consolidated financial statements.
NET RESULTS
Net earnings for the nine months ended September 30, 1995 of $667,000 or $.30
per share increased $351,000 from net earnings of $316,000 or $.14 per share
for the same period in 1994. The 111% increase in net earnings is primarily
due to increased sales and product margins and the elimination of the
negative impact of the discontinued operations on 1995 results, partially
offset by higher income taxes, higher selling, general and administrative
expenses and the special charge.
LIQUIDITY AND CAPITAL RESOURCES
Net cash provided by operations during the nine months ended September 30,
1995 of $837,000 resulted principally from the net earnings and the increases
in the Company's payables and accrued expenses, partially offset by the
increase in receivables and inventories.
The Company's historical seasonal patterns result in higher sales in the
second and third quarters of each year and lower sales in the first and
fourth quarters. Considering these sales patterns, the Company generally
requires external cash resources in the latter half of the first quarter
through the middle of the third quarter to fund and sustain the growth in
revenues. The latter part of the third quarter through the first part of the
first quarter typically represents the collection cycle. Several factors are
expected to result in less demand on cash flow from operations in 1995. The
rate of revenue growth in 1995 has been and is expected to be lower than the
growth experienced in 1994 resulting in less demand on cash; the Company
increased the credit department personnel in January and August 1995 which
has improved the collection cycle; and the Company will not have to fund the
operating losses at IESI in 1995. In addition capital expenditures are
anticipated to be lower than 1994 purchases.
The Company maintains a $4,100,000 working capital line of credit at a
commercial lending institution that allows the Company to borrow up to 80% of
the book value of eligible trade receivables plus the lessor of 25% of
eligible inventory or $500,000. As of September 30, 1995 and October 20,
1995, the Company had borrowed $2,371,000 and $1,934,000, respectively, on
this credit facility and had the capacity to borrow an additional $1,729,000
and $2,120,000, respectively. The Company also maintains a $350,000 capital
equipment credit facility providing for borrowings at 80% of cost on
purchases. There are advances outstanding under this credit facility of
$235,000 at September 30, 1995. Both credit facilities are payable on
demand. The Company negotiated a one-half of one percent reduction in its
borrowing rate on both of its credit facilities in September 1995.
Management believes that based on its equity position, the Company's current
credit facilities can be expanded during the next twelve months, if
necessary, and that these facilities, together with cash provided by
operations, will be sufficient for its capital and liquidity requirements for
the next twelve months.
9
<PAGE>
ABATIX ENVIRONMENTAL CORP. AND SUBSIDIARY
PART II
Other Information
Item 1. LEGAL PROCEEDINGS -- None
Item 2. CHANGES IN SECURITIES -- None
Item 3. DEFAULTS UPON SENIOR SECURITIES -- None
Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS -- In September
1995, the Company mailed to each of its registered shareholders a copy of an
information statement informing them that the Company was applying to the
State of Delaware for a reduction in its authorized capital. Effective
October 6, 1995, the Company's Certificate of Incorporation with the State of
Delaware was changed to reduce the Company's authorized preferred stock from
2,000,000 shares to 500,000 shares and to reduce the Company's authorized
common stock from 20,000,000 shares to 5,000,000 shares. Since the Company
had a written consent from shareholders owning 51.6% of the then outstanding
common stock, this action did not require a vote by all of the Company's
shareholders.
Item 5. OTHER INFORMATION -- None
Item 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits --
Exhibit 3(i) (a) Certificate of Incorporation (filed with the Company's
electronic filing only)
Exhibit (3)(i) (b) Amendment of Certificate of Incorporation (filed with the
Company's electronic filing only)
Exhibit (3)(i) (c) Amendment of Certificate of Incorporation (filed with the
Company's electronic filing only)
Exhibit (3)(ii) By-Laws (filed with the Company's electronic filing only)
Exhibit 11 Computation Re Per Share Earnings for the three and nine month
periods ended September 30, 1995 and 1994.
Exhibit 27 Financial Data Schedule for the nine months ended September 30,
1995 (filed with the Company's electronic filing only).
(b) Reports on Form 8-K --
There were no reports on Form 8-K filed for the three months ended
September 30, 1995.
10
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned as both a duly authorized officer and as the principal financial
and accounting officer by the Registrant.
ABATIX ENVIRONMENTAL CORP.
(Registrant)
Date: NOVEMBER 9, 1995 By: /S/ FRANK J. CINATL, IV
---------------- -------------------------
Frank J. Cinatl, IV
Vice President and Principal Financial
and Accounting Officer of Registrant
11
EXHIBIT 11
ABATIX ENVIRONMENTAL CORP. AND SUBSIDIARY
Computation Re Per Share Earnings
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
September 30, September 30,
------------------------ ------------------------
1995 1994 1995 1994
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Average shares outstanding:
Primary:
Common shares outstanding,
beginning of period 2,319,748 2,275,918 2,319,748 2,275,918
Weighted average number
of shares issued 21,566 40,000 17,147 34,926
Weighted average number
of shares acquired (173,389) - (148,741) -
Dilutive stock options and
warrants, based on the
treasury stock method using
average market prices 40,515 21,331 27,922 21,961
----------- ----------- ----------- -----------
Total 2,208,440 2,337,249 2,216,076 2,332,805
=========== =========== =========== ===========
Fully Diluted:
Common shares outstanding,
beginning of period 2,319,748 2,275,918 2,319,748 2,275,918
Weighted average number
of shares issued 21,566 40,000 17,147 34,926
Weighted average number
of shares acquired (173,389) - (148,741) -
Dilutive stock options and
warrants, based on the
treasury stock method
using the market price at
the end of the period if
higher than the average
market price 46,000 21,331 58,312 21,730
----------- ----------- ----------- -----------
Total 2,213,925 2,337,249 2,246,466 2,332,574
=========== =========== =========== ===========
Primary and fully diluted earnings:
Earnings from
continuing operations $ 190,219 $ 185,551 $ 666,581 $ 435,101
Loss from
discontinued operations - (25,970) - (119,384)
----------- ----------- ----------- -----------
Net earnings $ 190,219 $ 159,581 $ 666,581 $ 315,717
=========== =========== =========== ===========
Primary earnings per common and common equivalent share:
Earnings from
continuing operations $ 0.09 $ 0.08 $ 0.30 $ 0.19
Loss from
discontinued operations - (0.01) - (0.05)
----------- ----------- ----------- -----------
Net earnings $ 0.09 $ 0.07 $ 0.30 $ 0.14
=========== =========== =========== ===========
Fully diluted earnings per common and common equivalent share:
Earnings from
continuing operations $ 0.09 $ 0.08 $ 0.30 $ 0.19
Loss from
discontinued operations - (0.01) - (0.05)
----------- ----------- ----------- -----------
Net earnings $ 0.09 $ 0.07 $ 0.30 $ 0.14
=========== =========== =========== ===========
</TABLE>
CERTIFICATE OF INCORPORATION
OF
ABATIX ENVIRONMENTAL SUPPLY CORP.
The undersigned, a natural person, for the purpose of organizing a
corporation for conducting the business and promoting the purposes
hereinafter stated, under the provisions and subject to the requirements of
the laws of the State of Delaware (particularly Chapter 1, Title 8 of the
Delaware Code and the acts amendatory thereof and supplemental thereto, and
known, identified and referred to as the "General Corporation Law of the
State of Delaware"), hereby certifies that:
FIRST: The name of the corporation (hereinafter called the "corporation") is
ABATIX ENVIRONMENTAL SUPPLY CORP.
SECOND: The address, including street, number, city, and county, of the
registered office of the corporation in the State of Delaware is 1209 Orange
Street, City of Wilmington, County of New Castle; and the name of the
registered agent of the corporation in the State of Delaware 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 the state of Delaware.
FOURTH: The total number of shares of capital stock which the corporation
has authority to issue is as follows:
20,000,000 shares of Common Stock, $.001 par value per share.
2,000,000 shares of Preferred Stock, $1.00 par value per share.
The Board of Directors is authorized, subject to limitations prescribed by
law and the provisions of this Article FOURTH, to provide for the issuance of
the shares of Preferred Stock in series, and to establish from time to time
the number of shares to be included in each series, and to fix the
designation, powers, preferences and relative, participating, optional or
other special rights of the shares of each series and the qualifications,
limitations or restrictions thereof.
The authority of the Board with respect to each series of Preferred Stock
shall include, but not be limited to, determination of the following:
<PAGE>
The number of shares constituting the series and the distinctive designation
of the series;
The dividend rate on the shares of the series, whether dividends shall be
cumulative, and, if so, from which date or dates, and the relative rights of
priority, if any, of payments of dividends on shares of the series;
Whether the series will have voting rights, and, if so, the terms of the
voting rights;
Whether the series will have conversion privileges, and, if so, the terms and
conditions of the conversion, including provision for adjustment of the
conversion rate in such events as the Board of Directors determines;
Whether or not the shares of the series will be redeemable, and, if so, the
terms and conditions of redemption, including the date or dates upon or after
which they shall be redeemable, and the amount per share payable in case of
redemption, which amount may vary under different conditions and at different
redemption dates;
Whether the series shall have a sinking fund for the redemption or purchase
of shares of the series, and, if so, the terms and amount of the sinking fund;
The rights of the shares of the series in the event of voluntary or
involuntary liquidation, dissolution or winding up of the corporation, and the
relative rights of priority, if any, of payment of shares of the series; and
Any other relative terms, rights, preferences and limitations, if any, of the
series as the Board of Directors may lawfully fix under the laws of the State
of Delaware as in effect at the time of the creation of such series.
FIFTH: The name and the mailing address of the incorporator are as follows:
NAME MAILING ADDRESS
James Schneider 700 Southeast Third Avenue, Suite 300
Fort Lauderdale, Florida 33316
SIXTH: The corporation is to have perpetual existence.
2
<PAGE>
SEVENTH: Whenever a compromise or arrangement is proposed between this
corporation and its creditors or any class of them and/or between this
corporation and its stockholders or any class of them, any court of equitable
jurisdiction within the State of Delaware may, on the application in a
summary way of this corporation or of any creditor or stockholder thereof or
on the application of any receiver or receivers appointed for this
corporation under the provisions of section 291 of Title 8 of the Delaware
Code order a meeting of the creditors or class of creditors, and/or of the
stockholders or class of stockholders of this corporation, as the case may
be, to be summoned in such manner as the said court directs. If a majority in
number representing three-fourths in value of the creditors or class of
creditors, and/or of the stockholders or class of stockholders of this
corporation, as the case may be, agree to any compromise or arrangement and
to any reorganization of this corporation as consequence of such compromise
or arrangement, the said compromise or arrangement and the said
reorganization shall, if sanctioned by the court to which the said application
has been made, be binding on all the creditors or class of creditors, and/or
on all the stockholders or class of stockholders, of this corporation, as the
case may be, and also on this corporation.
EIGHTH: For the management of the business and for the conduct of the
affairs of the corporation, and in further definition, limitation and
regulation of the powers of the corporation and of its directors and of its
stockholders or any class thereof, as the case may be, it is further provided:
1. The management of the business and the conduct of the affairs of the
corporation shall be vested in its Board of Directors. The number of
directors which shall constitute the whole Board of Directors shall be fixed
by, or in the manner provided in, the Bylaws. The phrase "whole Board" and
the phrase "total number of directors" shall be deemed to have the same
meaning, to wit, the total number of directors which the corporation would
have if there were no vacancies. No election of directors need be by written
ballot.
3
<PAGE>
2. After the original or other Bylaws of the corporation have been adopted,
amended, or repealed, as the case may be, in accordance with the provisions
of Section 109 of the General Corporation Law of the State of Delaware, and,
after the corporation has received any payment for any of its stock, the
power to adopt, amend, or repeal the Bylaws of the corporation may be
exercised by the Board of Directors of the corporation; provided, however,
that any provision for the classification of directors of the corporation for
staggered terms pursuant to the provisions of subsection (d) of Section 141 of
the General Corporation Law of the State of Delaware shall be set forth in an
initial Bylaw or in a Bylaw adopted by the stockholders entitled to vote of
the corporation unless provisions for such classification shall be set forth
in this certificate of incorporation.
3. Whenever the corporation shall be authorized to issue only one class of
stock, each outstanding share shall entitle the holder thereof to notice of,
and the right to vote at, any meeting of stockholders. Whenever the
corporation shall be authorized to issue more than one class of stock, no
outstanding share of any class of stock which is denied voting power under
the provisions of the certificate of incorporation shall entitle the holder
thereof to the right to vote at any meeting of stockholders except as the
provisions of paragraph (2) of subsection (b) of Section 242 of the General
Corporation Law of the State of Delaware shall otherwise require; provided,
that no share of any such class which is otherwise denied voting power shall
entitle the holder thereof to vote upon the increase or decrease in the
number of authorized shares of said class.
NINTH: The personal liability of the directors of the corporation is hereby
eliminated to the fullest extent permitted by paragraph (7) of subsection (b)
of Section 102 of the General Corporation Law of the State of Delaware, as
the same may be amended and supplemented.
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TENTH: The corporation shall, to the fullest extent permitted by Section 145
of the General Corporation Law of the State of Delaware, as the same may be
amended and supplemented, indemnify any and all persons whom it shall have
power to indemnify under said section from and against any and all of the
expenses, liabilities or other matters referred to in or covered by said
section, and the indemnification provided for herein shall not be deemed
exclusive of any other rights to which those indemnified may be entitled
under any Bylaw, agreement, vote of stockholders or disinterested directors or
otherwise, both as to action in his official capacity and as to action in
another capacity while holding such office, and shall continue as to a person
who has ceased to be a director, officer, employee or agent and shall inure
to the benefit of the heirs, executors and administrators of such a person.
ELEVENTH: From time to time any of the provisions of this certificate of
incorporation may be amended, altered or repealed, and other provisions
authorized by the laws of the State of Delaware at the time in force may be
added or inserted in the manner and at the time prescribed by said laws, and
all rights at any time conferred upon the stockholders of the corporation by
this certificate of incorporation are granted subject to the provisions of
this Article ELEVENTH.
Signed on November 28, 1988.
By:/S/ JAMES SCHNEIDER
--------------------
James Schneider, Incorporator
CERTIFICATE OF AMENDMENT
OF
CERTIFICATE OF INCORPORATION
Abatix Environmental Supply Corp. (the "Corporation"), a corporation
organized and existing under and by virtue of the General Corporation Law of
the State of Delaware, DOES HEREBY CERTIFY:
FIRST: That the Board of Directors of the Corporation, by the unanimous
written consent of its members and filed with the minutes of the Corporation,
adopted a resolution proposing and declaring advisable the following amendment
to the Certificate of Incorporation of the Corporation:
RESOLVED, that the Certificate of Incorporation of Abatix Environmental
Supply Corp. be amended by changing the First Article thereof so that, as
amended, said Article shall be and read as follows:
"FIRST: The name of the corporation (hereinafter called the "corporation")
is ABATIX ENVIRONMENTAL CORP."
SECOND: That in lieu of a meeting and vote of stockholders, the sole
stockholder has given unanimous written consent to said amendment in
accordance with the provisions of Section 228 of the General Corporation Law
of the State of Delaware.
<PAGE>
THIRD: That the aforesaid amendment was duly adopted in accordance with the
applicable provisions of Section 242 and 228 of the General Corporation Law
of the State of Delaware.
IN WITNESS WHEREOF, the corporation has caused this certificate to be signed
by Gary L. Cox, it Executive Vice President, and attested by Stephen R.
Patterson, its Assistant Secretary this 6th day of January, 1989.
ABATIX ENVIRONMENTAL SUPPLY CORP.
(SEAL) By:/S/ GARY L. COX
------------------
Gary L. Cox, Executive Vice President
ATTEST:
By:/S/ STEPHEN R. PATTERSON
-------------------------
Stephen R. Patterson, Assistant Secretary
BY LAWS
OF
ABATIX ENVIRONMENTAL CORP.
a Delaware corporation
ARTICLE I
STOCKHOLDERS
1. CERTIFICATES REPRESENTING STOCK. Certificates representing stock in the
corporation shall be signed by, or in the name of, the corporation by the
Chairman or Vice-Chairman of the Board of Directors, if any, or by the
President or a Vice-President and by the Treasurer or an Assistant Treasurer
or the Secretary or an Assistant Secretary of the corporation. Any or all
the signatures on any such certificate may be a facsimile. In case any
officer, transfer agent, or registrar who has signed or whose facsimile
signature has been placed upon a certificate shall have ceased to be such
officer, transfer agent, or registrar before such certificate is issued, it
may be issued by the corporation with the same effect as if he were such
officer, transfer agent, or registrar at the date of issue.
Whenever the corporation shall be authorized to issue more than one class of
stock or more than one series of any class of stock, and whenever the
corporation shall issue any shares of its stock as partly paid stock, the
certificates representing shares of any such class or series or of any such
partly paid stock shall set forth thereon the statements prescribed by the
General Corporation Law. Any restrictions on the transfer or registration of
transfer of any shares of stock of any class or series shall be noted
conspicuously on the certificate representing such shares.
The corporation may issue a new certificate of stock or uncertificated shares
in place of any certificate theretofore issued by it, alleged to have been
lost, stolen, or destroyed, and the Board of Directors may require the owner
of the lost, stolen, or destroyed certificate, or his legal representative,
to give the corporation a bond sufficient to indemnify the corporation
against any claim that may be made against it on account of the alleged loss,
theft, or destruction of any such certificate or the issuance of any such new
certificate or uncertificated shares.
<PAGE>
2. UNCERTIFICATED SHARES. Subject to any conditions imposed by the General
Corporation Law the Board of Directors of the corporation may provide by
resolution or resolutions that some or all of any or all classes or series of
the stock of the corporation shall be uncertificated shares. Within a
reasonable time after the issuance or transfer of any uncertificated shares,
the corporation shall send to the registered owner thereof any written notice
prescribed by the General Corporation Law.
3. FRACTIONAL SHARE INTERESTS. The corporation may, but shall not be
required to, issue fractions of a share. If the corporation does not issue
fractions of a share, it shall (a) arrange for the disposition of fractional
interests by those entitled thereto, (b) pay in cash the fair value of
fractions of a share as of the time when those entitled to receive such
fractions are determined, or (c) issue scrip or warrants in registered form
(either represented by a certificate or uncertificated) or bearer form
(represented by a certificate) which shall entitle the holder to receive a
full share upon the surrender of such scrip or warrants aggregating a full
share. A certificate for a fractional share or an uncertificated fractional
share shall, but scrip or warrants shall not unless otherwise provided
therein, entitle the holder to exercise voting rights, to receive dividends
thereon, and to participate in any of the assets of the corporation in the
event of liquidation. The Board of Directors may cause scrip or warrants to
be issued subject to the conditions that they shall become void if not
exchanged for certificates representing the full shares or uncertificated full
shares before a specified date, or subject to the conditions that the shares
for which scrip or warrants are exchangeable may be sold by the corporation
and the proceeds thereof distributed to the holders of scrip or warrants, or
subject to any other conditions which the Board of Directors may impose.
4. STOCK TRANSFERS. Upon compliance with provisions restricting the
transfer or registration of transfer of shares of stock, if any, transfers or
registration of transfers of shares of stock of the corporation shall be made
only on the stock ledger of the corporation by the registered holder thereof,
or by his attorney thereunto authorized by power of attorney duly executed
and filed with the Secretary of the corporation or with a transfer agent or a
registrar, if any, and, in the case of shares represented by certificates, on
surrender of the certificate or certificates for such shares of stock
properly endorsed and the payment of all taxes due thereon.
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<PAGE>
5. RECORD DATE FOR STOCKHOLDERS. In order that the corporation may
determine the stockholders entitled to notice of or to vote at any meeting of
stockholders or any adjournment thereof, the Board of Directors may fix a
record date, which record date shall not precede the date upon which the
resolution fixing the record date is adopted by the Board of Directors, and
which record date shall not be more than 60 nor less than 10 days before the
date of such meeting. If no record date is fixed by the Board of Directors,
the record date for determining stockholders entitled to notice of or to vote
at a meeting of stockholders shall be at the close of business on the day
next preceding the day on which notice is given, or, if notice is waived, at
the close of business on the day next preceding the day on which the meeting
is held. A determination of stockholders of record entitled to notice of or
to vote at a meeting of stockholders shall apply to any adjournment of the
meeting; provided, however, that the Board of Directors may fix a new record
date for the adjourned meeting. In order that the corporation may determine
the stockholders entitled to consent to corporate action in writing without a
meeting, the Board of Directors may fix a record date, which record date shall
not precede the date upon which the resolution fixing the record date is
adopted by the Board of Directors, and which date shall not be more than 10
days after the date upon which the resolution fixing the record date is
adopted by the Board of Directors. If no record date has been fixed by the
Board of Directors, the record date for determining the stockholders entitled
to consent to corporate action in writing without a meeting, when no prior
action by the Board of Directors is required by the General Corporation Law,
shall be the first date on which a signed written consent setting forth the
action taken or proposed to be taken is delivered to the corporation by
delivery to its registered office in the State of Delaware, its principal
place of business, or an officer or agent of the corporation having custody of
the book in which proceedings of meetings of stockholders are recorded.
Delivery made to the corporation's registered office shall be by hand or by
certified or registered mail, return receipt requested. If no record date has
been fixed by the Board of Directors and prior action by the Board of
Directors is required by the General Corporation Law, the record date for
determining stockholders entitled to consent to corporate action in writing
without a meeting shall be at the close of business on the day on which the
Board of Directors adopts the resolution taking such prior action. In order
that the corporation may determine the stockholders entitled to receive
payment of any dividend or other distribution or allotment of any rights or
the stockholders entitled to exercise any rights in respect of any change,
conversion, or exchange of stock, or for the purpose of any other lawful
action, the Board of Directors may fix a record date, which record date shall
not precede the date upon which the resolution fixing the record date is
adopted, and which record date shall be not more than 60 days prior to such
action. If no record date is fixed, the record date for determining
stockholders for any such purpose shall be at the close of business on the
day on which the Board of Directors adopts the resolution relating thereto.
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<PAGE>
6. MEANING OF CERTAIN TERMS. As used herein in respect of the right to
notice of a meeting of stockholders or a waiver thereof or to participate or
vote thereat or to consent or dissent in writing in lieu of a meeting, as the
case may be, the term "share" or "shares" or "share of stock" or "shares of
stock" or "stockholder" or "stockholders" refers to an outstanding share or
shares of stock and to a holder or holders of record of outstanding shares of
stock when the corporation is authorized to issue only one class of shares of
stock, and said reference is also intended to include any outstanding share
or shares of stock and any holder or holders of record of outstanding shares
of stock of any class upon which or upon whom the Certificate of
Incorporation confers such rights where there are two or more classes or
series of shares of stock or upon which or upon whom the General Corporation
Law confers such rights notwithstanding that the Certificate of Incorporation
may provide for more than one class or series of shares of stock, one or more
of which are limited or denied such rights thereunder; provided, however,
that no such right shall vest in the event of an increase or a decrease in
the authorized number of shares of stock of any class or series which is
otherwise denied voting rights under the provisions of the Certificate of
Incorporation, except as any provision of law may otherwise require.
7. STOCKHOLDER MEETINGS.
A. TIME. The annual meeting shall be held on the date and at the time fixed,
from time to time, by the Board of Directors, provided, that the first annual
meeting shall be held on a date within 13 months after the organization of the
corporation, and each successive annual meeting shall be held on a date within
13 months after the date of the preceding annual meeting. A special meeting
shall be held on the date and at the time fixed by the Board of Directors.
B. PLACE. Annual meetings and special meetings shall be held at such place,
within or without the States of Delaware or Texas, as the Board of Directors
may, from time to time, fix. Whenever the directors shall fail to fix such
place, the meeting shall be held at the registered office of the corporation
in the State of Delaware.
C. CALL. Annual meetings and special meetings may be called by a majority of
the Board of Directors or by any officer instructed by a majority of the
Board of Directors to call the meeting.
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<PAGE>
D. NOTICE OR WAIVER OF NOTICE. Written notice of all meetings shall be given,
stating the place, date, and hour of the meeting and stating the place within
the city or other municipality or community at which the list of stockholders
of the corporation may be examined. The notice of an annual meeting shall
state that the meeting is called for the election of directors and for the
transaction of other business which may properly come before the meeting, and
shall (if any other action which could be taken at a special meeting is to be
taken at such annual meeting) state the purpose or purposes. The notice of a
special meeting shall in all instances state the purpose or purposes for
which the meeting is called. The notice of any meeting shall also include,
or be accompanied by, any additional statements, information, or documents
prescribed by the General Corporation Law. Except as otherwise provided by
the General Corporation Law, a copy of the notice of any meeting shall be
given, personally or by mail, not less than 10 days nor more than 60 days
before the date of the meeting, unless the lapse of the prescribed period of
time shall have been waived, and directed to each stockholder at his record
address or at such other address which he may have furnished by request in
writing to the Secretary of the corporation. Notice by mail shall be deemed
to be given when deposited, with postage thereon prepaid, in the United States
mail. If a meeting is adjourned to another time, not more than 30 days hence,
and/or to another place, and if an announcement of the adjourned time and/or
place is made at the meeting, it shall not be necessary to give notice of the
adjourned meeting unless the directors, after adjournment, fix a new record
date for the adjourned meeting. Notice need not be given to any stockholder
who submits a written waiver of notice signed by him before or after the time
stated therin. Attendance of a stockholder at a meeting of stockholders shall
constitute a waiver of notice of such meeting, except when the stockholder
attends the meeting for the express purpose of objecting, at the beginning
of the meeting, to the transaction of any business because the meeting is not
lawfully called or convened. Neither the business to be transacted at, nor
the purpose of, any regular or special meeting of the stockholders need be
specified in any written waiver of notice.
E. STOCKHOLDER LIST. The officer who has charge of the stock ledger of the
corporation shall prepare and make, at least 10 days before every meeting of
stockholders, a complete list of the stockholders, arranged in alphabetical
order, and showing the address of each stockholder and the number of shares
registered in the name of each stockholder. Such list shall be open to the
examination of any stockholder, for any purpose germane to the meeting,
during ordinary business hours, for a period of at least 10 days prior to
the meeting, either at a place within the city or other municipality or
community where the meeting is to be held, which place shall be specified in
the notice of the meeting, or if not so specified, at the place where the
meeting is to be held. The list shall also be produced and kept at the time
and place of the meeting during the whole time thereof, and may be inspected
by any stockholder who is present. The stock ledger shall be the only
evidence as to who are the stockholders entitled to examine the stock ledger,
the list required by this section or the books of the corporation, or to vote
at any meeting of stockholders.
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<PAGE>
F. CONDUCT OF MEETING. Meetings of the stockholders shall be presided over by
one of the following officers in the order of seniority and if present and
acting the Chairman of the Board, if any, the Vice-Chairman of the Board, if
any, the President, a Vice-President, or, if none of the foregoing is in
office and present and acting, by a chairman to be chosen by the
stockholders. The Secretary of the corporation, or in his absence, an
Assistant Secretary, shall act as secretary of every meeting, but if neither
the Secretary nor an Assistant Secretary is present the Chairman of the
meeting shall appoint a secretary of the meeting.
G. PROXY REPRESENTATION. Every stockholder may authorize another person or
persons to act for him by proxy in all matters in which a stockholder is
entitled to participate, whether by waiving notice of any meeting, voting or
participating at a meeting, or expressing consent or dissent without a
meeting. Every proxy must be signed by the stockholder or by his attorney-in-
fact. No proxy shall be voted or acted upon after three years from its date
unless such proxy provides for a longer period. A duly executed proxy shall
be irrevocable if it states that it is irrevocable and, if an only as long as,
it is coupled with an interest sufficient in law to support an irrevocable
power. A proxy may be made irrevocable regardless of whether the interest
with which it is coupled is an interest in the stock itself or an interest
in the corporation generally.
H. INSPECTORS. The directors, in advance of any meeting, may, but need not,
appoint one or more inspectors of election to act at the meeting or any
adjournment thereof. If an inspector or inspectors are not appointed, the
person presiding at the meeting may, but need not, appoint one or more
inspectors. In case any person who may be appointed as an inspector fails to
appear or act, the vacancy may be filled by appointment made by the Board of
Directors in advance of the meeting or at the meeting by the person presiding
thereat. Each inspector, if any, before entering upon the discharge of his
duties, shall take and sign an oath faithfully to execute the duties of
inspectors at such meeting with strict impartiality and according to the best
of his ability. The inspectors, if any, shall determine the number of shares
of stock outstanding and the voting power of each, the shares of stock
represented at the meeting, the existence of a quorum, the validity and
effect of proxies, and shall receive votes, ballots, or consents, here and
determine all challenges and questions arising in connection with the right
to vote, count and tabulate all votes, ballots, or consents, determine the
result, and do such acts as are proper to conduct the election or vote with
fairness to all stockholders. On request of the person presiding at the
meeting, the inspector or inspectors, if any, shall make a report in writing
of any challenge, question, or matter determined by him or them and execute a
certificate of any fact found by him or them.
6
<PAGE>
I. QUORUM. The holders of a majority of the outstanding shares of stock
shall constitute a quorum at a meeting of stockholders for the transaction of
any business. The stockholders present may adjourn the meeting despite the
absence of a quorum.
J. VOTING. Each share of stock shall entitle the holders thereof to one
vote. Directors shall be elected by a plurality of the votes of the shares
present in person or represented by proxy at the meeting and entitled to vote
on the election of directors. Any other action shall be authorized by a
majority of the votes cast except where the General Corporation Law
prescribes a different percentage of votes and/or a different exercise of
voting power, and except as may be otherwise prescribed by the provisions of
the Certificate of Incorporation and these Bylaws. In the election of
directors, and for any other action, voting need not be by ballot.
8. STOCKHOLDER ACTION WITHOUT MEETINGS. Any action required by the General
Corporation Law to be taken at any annual or special meeting of stockholders,
or any action which may be taken at any annual or special meeting of
stockholders, may be taken without a meeting, without prior notice and
without a vote, if a consent in writing, setting forth the action so taken,
shall be signed by the holders of outstanding stock having not less than the
minimum number of votes that would be necessary to authorize or take such
action at a meeting at which all shares entitled to vote thereon were present
and voted. Prompt notice of the taking of the corporate action without a
meeting by less than unanimous written consent shall be given to those
stockholders who have not consented in writing. Action taken pursuant to
this paragraph shall be subject to the provisions of Section 228 of the
General Corporation Law.
ARTICLE II
DIRECTORS
1. FUNCTIONS AND DEFINITION. The business and affairs of the corporation
shall be managed by or under the direction of the Board of Directors of the
corporation. The Board of Directors shall have the authority to fix the
compensation of the members thereof. The use of the phrase "whole board"
herein refers to the total number of directors which the corporation would
have if there were no vacancies.
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<PAGE>
2. QUALIFICATIONS AND NUMBER. A director need not be a stockholder, a
citizen of the United States, or a resident of the State of Delaware. The
initial Board of Directors shall consist of two persons. Thereafter the
number of directors constituting the whole board shall be at least one.
Subject to the foregoing limitation and except for the first Board of
Directors, such number may be fixed from time to time by action of the
stockholders or of the Board of Directors, or, if the number is not fixed,
the number shall be three. The number of directors may be increased or
decreased by action of the stockholders or of the directors.
3. ELECTION AND TERM. The first Board of Directors, unless the members
thereof shall have been named in the Certificate of Incorporation, shall be
elected by the incorporator or incorporators and shall hold office until the
first annual meeting of stockholders and until their successors are elected
and qualified or until their earlier resignation or removal. Any director
may resign at any time upon written notice to the corporation. Thereafter,
directors who are elected at an annual meeting of stockholders, and directors
who are elected in the interim to fill vacancies and newly created
directorships, shall hold office until the next annual meeting of
stockholders and until their successors are elected and qualified or until
their earlier resignation or removal. Except as the General Corporation Law
may otherwise require, in the interim between annual meetings of stockholders
or of special meetings of stockholders called for the election of directors
and/or for the removal of one or more directors and for the filling of any
vacancy in that connection, newly created directorships and any vacancies in
the Board of Directors, including unfilled vacancies resulting from the
removal of directors for cause or without cause, may be filled by the vote of
a majority of the remaining directors then in office, although less than a
quorum, or by the sole remaining director.
4. MEETINGS.
A. TIME. Meetings shall be held at such time as the Board of Directors shall
fix, except that the first meeting of a newly elected Board of Directors shall
be held as soon after its election as the directors may conveniently assemble.
B. PLACE. Meetings shall be held at such place within or without the states
of Delaware or Texas as shall be fixed by the Board of Directors.
C. CALL. No call shall be required for regular meetings for which the time
and place have been fixed. Special meetings may be called by or at the
direction of the Chairman of the Board, if any, the Vice-Chairman of the
Board, if any, of the President, or of a majority of the directors in office.
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D. NOTICE OR ACTUAL OR CONSTRUCTIVE WAIVER. No notice shall be required for
regular meetings for which the time and place have been fixed. Written,
oral, or any other mode of notice of the time and place shall be given for
special meetings in sufficient time for the convenient assembly of the
directors thereat. Notice need not be given to any director or to any member
of a committee of directors who submits a written waiver of notice signed by
him before or after the time stated therein. Attendance of any such person at
a meeting shall constitute a waiver of notice of such meeting, except when he
attends a meeting for the express purpose of objecting, at the beginning of
the meeting, to the transaction of any business because the meeting is not
lawfully called or convened. Neither the business to be transacted at, nor
the purpose of, any regular or special meeting of the directors need be
specified in any written waiver of notice.
E. QUORUM AND ACTION. A majority of the whole Board of Directors shall
constitute a quorum except when a vacancy or vacancies prevents such
majority, whereupon a majority of the directors in office shall constitute a
quorum, provided, that such majority shall constitute at least one-third of
the whole Board of Directors. A majority of the directors present, whether
or not a quorum is present, may adjourn a meeting to another time and place.
Except as herein otherwise provided, and except as otherwise provided by the
General Corporation Law, the vote of the majority of the directors present at
a meeting at which a quorum is present shall be the act of the Board of
Directors. The quorum and voting provisions herein stated shall not be
construed as conflicting with any provisions of the General Corporation Law
and these By-Laws which govern a meeting of directors held to fill vacancies
and newly created directorships in the Board of Directors or action of
disinterested directors.
Any member or members of the Board of Directors or of any committee
designated by the Board of Directors, may participate in a meeting of the
Board of Directors, or any such committee, as the case may be, by means of
conference telephone or similar communications equipment by means of which
all persons participating in the meeting can hear each other.
F. CHAIRMAN OF THE MEETING. The Chairman of the Board, if any and if present
and acting, shall preside at all meetings. Otherwise, the Vice-Chairman of
the Board, if any and if present and acting, or the President, if present and
acting, or any other director chosen by the Board of Directors, shall preside.
9
<PAGE>
5. REMOVAL OF DIRECTORS. Except as may otherwise be provided by the General
Corporation Law, any director or the entire Board of Directors may be removed,
with or without cause, by the holders of a majority of the shares then
entitled to vote at an election of directors.
6. COMMITTEES. The Board of Directors may, by resolution passed by a
majority of the whole Board of Directors, designate one or more committees,
each committee to consist of one or more of the directors of the corporation.
The Board of Directors may designate one or more directors as alternate
members of any committee, who may replace any absent or disqualified member
at any meeting of the committee. In the absence or disqualification of any
member of any such committee or committees, the member or members thereof
present at any meeting and not disqualified from voting, whether or not he or
they constitute a quorum, may unanimously appoint another member of the Board
of Directors to act at the meeting in the place of any such absent or
disqualified member. Any such committee, to the extent provided in the
resolution of the Board of Directors, shall have and may exercise the powers
and authority of the Board of Directors in the management of the business and
affairs of the corporation with the exception of any authority the delegation
of which is prohibited by Section 141 of the General Corporation Law, and may
authorize the seal of the corporation to be affixed to all papers which may
require it.
7. WRITTEN ACTION. Any action required or permitted to be taken at any
meeting of the Board of Directors or any committee thereof may be taken
without a meeting if all members of the Board of Directors or committee, as
the case may be, consent thereto in writing, and the writing or writings are
filed with the minutes of proceedings of the Board of Directors or committee.
ARTICLE: III
OFFICERS
The officers of the corporation shall consist of a President, a Secretary, a
Treasurer, and, if deemed necessary, expedient, or desirable by the Board of
Directors, a Chairman of the Board, a Vice-Chairman of the Board, an
Executive Vice-President, one or more other Vice-Presidents, one or more
Assistant Secretaries, one or more Assistant Treasurers, and such other
officers with such titles as the resolution of the Board of Directors
choosing them shall designate. Except as may otherwise be provided in the
resolution of the Board of Directors choosing him, no officer other than the
Chairman or Vice-Chairman of the Board of Directors, if any, need be a
director. Any number of offices may be held by the same person, as the
directors may determine.
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<PAGE>
Unless otherwise provided in the resolution choosing him, each officer shall
be chosen for a term which shall continue until the meeting of the Board of
Directors following the next annual meeting of stockholders and until his
successor shall have been chosen and qualified.
All officers of the corporation shall have such authority and perform such
duties in the management and operation of the corporation as shall be
prescribed in the resolutions of the Board of Directors designating and
choosing such officers and prescribing their authority and duties, and shall
have such additional authority and duties as are incident to their office
except to the extent that such resolutions may be inconsistent therewith.
The Secretary or an Assistant Secretary of the corporation shall record all
of the proceedings of all meetings and actions in writing of stockholders,
directors, and committees of directors, and shall exercise such additional
authority and perform such additional duties as the Board shall assign to
him. Any officer may be removed, with or without cause, by the Board of
Directors. Any vacancy in any office may be filled by the Board of Directors.
ARTICLE IV
CORPORATE SEAL
The corporate seal shall be in such form as the Board of Directors shall
prescribe.
ARTICLE V
FISCAL YEAR
The fiscal year of the corporation shall be fixed, and shall be subject to
change, by the Board of Directors.
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CERTIFICATE OF AMENDMENT
OF
CERTIFICATE OF INCORPORATION
Abatix Environmental Corp. (the "Corporation"), a corporation organized and
existing under and by virtue of the General Corporation Law of the State of
Delaware, DOES HEREBY CERTIFY:
FIRST: That the Board of Directors of the Corporation, by the unanimous
written consent of its members and filed with the minutes of the Corporation,
adopted a resolution proposing and declaring advisable the following
amendment to the Certificate of Incorporation of the Corporation:
RESOLVED, that the Certificate of Incorporation of Abatix Environmental Corp.
be amended by changing the Fourth Article thereof so that, as amended, said
Article shall be and read as follows:
FOURTH: The total number of shares of capital stock which the corporation
has authority to issue is as follows:
5,000,000 shares of Common Stock, $.001 par value per share.
500,000 shares of Preferred Stock, $1.00 par value per share.
The Board of Directors is authorized, subject to limitations prescribed by
law and the provisions of this Article FOURTH, to provide for the issuance of
the shares of Preferred Stock in series, and to establish from time to time
the number of shares to be included in each series, and to fix the
designation, powers, preferences and relative, participating, optional or
other special rights of the shares of each series and the qualifications,
limitations, or restrictions therof.
The authority of the Board with respect to each series of Preferred Stock
shall include, but not be limited to determination of the following:
The number of shares constituting the series and the distinctive designation
of the series;
The dividend rate on the shares of the series, whether dividends shall be
cumulative, and, if so, from which date or dates, and the relative rights of
priority, if any, of payments of dividends on shares of the series;
Whether the series will have voting rights, and, if so, the terms of the
voting rights;
Whether the series will have conversion privileges, and, if so, the terms and
conditions of the conversion, including provision for adjustment of the
conversion rate in such events as the Board of Directors determines;
Whether or not the shares of the series will be redeemable, and, if so, the
terms and conditions of redemption, including the date or dates upon or after
which they shall be redeemable, and the amount per share payable in case or
redemption, which amount may vary under different conditions and at different
redemption dates;
Whether the series shall have a sinking fund for the redemption or purchase of
shares of the series, and, if so, the terms and amount of the sinking fund;
The rights of the shares of the series in the event of voluntary or
involuntary liquidation, dissolution or winding up of the corporation, and
the relative rights of priority, if any, of payment of shares of the series;
and
Any other relative terms, rights, preferences and limitations, if any, of the
series as the Board of Directors may lawfully fix under the laws of the
State of Delaware as in effect at the time of creation of such series.
SECOND: That in lieu of a meeting and vote of stockholders, the holders of a
majority in interest of the outstanding Common Stock of the Corporation
(consituting the only capital stock interest entitled to vote on such action)
on September 15, 1995 have given written consent to said amendment in
accordance with the provisions of Section 228 of the General Corporation Law
of the State of Delaware.
THIRD: That the aforesaid amendment was duly adopted in accordance with the
applicable provisions of Section 242 and 228 of the General Corporation Law
of the State of Delaware.
IN WITNESS WHEREOF, the corporation has caused this certificate to be signed
by Terry W. Shaver, its President, and attested by Gary L. Cox, its Secretary
this 29th day of September, 1995.
ABATIX ENVIRONMENTAL CORP.
By /s/ Terry W. Shaver
(Seal) --------------------------
Terry W. Shaver, President
ATTEST:
By /s/ Gary L. Cox
-----------------------
Gary L. Cox, Secretary
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONSOLIDATED BALANCE SHEET AT SEPTEMBER 30, 1995 AND THE CONSOLIDATED
STATEMENT OF OPERATIONS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1995 AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> SEP-30-1995
<CASH> 199,332
<SECURITIES> 0
<RECEIVABLES> 5,142,127
<ALLOWANCES> (292,604)
<INVENTORY> 2,836,544
<CURRENT-ASSETS> 8,185,787<F1>
<PP&E> 1,390,303
<DEPRECIATION> (825,775)
<TOTAL-ASSETS> 8,840,911
<CURRENT-LIABILITIES> 4,610,469
<BONDS> 0
<COMMON> 2,341
0
0
<OTHER-SE> 4,189,711<F2>
<TOTAL-LIABILITY-AND-EQUITY> 8,840,911
<SALES> 20,831,377
<TOTAL-REVENUES> 20,831,377
<CGS> 14,785,132
<TOTAL-COSTS> 14,785,132
<OTHER-EXPENSES> 4,740,178<F3>
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 182,358<F4>
<INCOME-PRETAX> 1,123,709
<INCOME-TAX> 457,125
<INCOME-CONTINUING> 666,584
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 666,584
<EPS-PRIMARY> .30
<EPS-DILUTED> .30
<FN>
<F1>AMOUNT REPRESENTS TOTAL CURRENT ASSETS.
<F2>INCLUDES THE COST OF 179,500 COMMON SHARES IN TREASURY OF $456,477.
<F3>INCLUDES A SPECIAL CHARGE OF $80,000 FOR THE SHUTDOWN OF THE COMPANY'S
CORPUS CHRISTI, TEXAS LOCATION.
<F4>INCLUDES INTEREST EXPENSE OF $204,573 AND INTEREST INCOME AND OTHER, NET
OF $22,215.
</FN>
</TABLE>
