Findings Of Fact On February 10, 1989, respondent, Department of Insurance and Treasurer (Department), issued Invitation To Bid No. DIT-88/89-112 (ITB) to prospective bidders inviting bids for the provision of the following service: The Florida Treasurer & Insurance Commissioner's Office, hereinafter referred to as "State," requires a wire service to ensure the timely distribution of the State's news releases. The State, therefore, invites all interested wire services to submit bids for a 2-year, fixed-rate contract. The ITB provided further that bids were due by 2:00 p.m. on February 21, 1989, they would be opened at that time, and the posting of bid tabulations would occur the following day. Also, the ITB provided that the bid award would "be made to the lowest responsive bidder using the fixed rate for the first 400 words of each press release." There was no provision for a prebid conference but the Department advised prospective bidders that questions would be answered by telephone up to the time the bids were due. Whether any prospective bidder availed itself of this opportunity is not of record. Petitioner, PR Newswire, and intervenor, Business Wire, are newswire services who, among other things, transmit client information by computer and printer to various media points (e.g., newspapers, television and radio stations) throughout the state. If the media point has the capability of receiving transmissions by computer, the newswire service utilizes a satellite, or computer link, to transmit the information to the media point. Some media points either do not have computer capability or choose not to use satellite service and thus receive a hard copy of the transmission via TELEX and other similar machines. PR Newswire has had a contract with the Department for the last two years to provide this service. It will continue to do so pending the outcome of this bid dispute. Bid proposals in response to the ITB were timely filed by petitioner and intervenor. Both firms submitted bids with a $40 charge for the first 400 words of each press release and a charge of $10 for each additional 100 words. This was not surprising since Business Wire offers a discounted government rate for its service and PR Newswire knew it had to submit a comparable rate to be competitive. Since the dollar amounts were identical, the Department relied upon advice from its legal counsel for a procedure to break the tie. Under this procedure, the two proposals were evaluated to determine which was the most "responsive." The evaluation process consisted of determining which firm had the greater capacity for "transmitting via computer links to the most Florida media markets listed in Exhibit A" of the ITB. Exhibit A is a three page listing of newspapers, wire services, and television and radio stations throughout the state. After this evaluation was made, the Department selected Business Wire as the lowest and most responsive bidder. This information was conveyed to PR Newswire by letter dated March 9, 1989. Upon receiving the letter, PR Newswire filed its formal protest alleging that the agency had misinterpreted certain information and relied on erroneous information in awarding the contract to Business Wire. The filing of the protest prompted this proceeding. The Department issues press releases approximately three times per month. It desires such releases to be in the hands of the editor or news director within thirty minutes after the wire service receives the Department's release for dissemination. To operate within this time constraint, the wire service must transmit the information to the media point via computer. At the same time, the Department considers a hard copy coming off a teleprinter to be "unsatisfactory" and less likely to be used by, an editor or news director. This is because a hard copy is more likely to be lost or misplaced while a release sent via computer is generally retained on the media point's computer for at least twenty-four hours. For these reasons, the Department placed the following provision in the Special Conditions of the ITB: b. The bidder must be capable of transmitting via computer links to the most Florida media markets listed in Exhibit A. Other distribution methods such as telecopiers (fascimile), telex messenger, etc., are unacceptable. (Emphasis in original) The General Conditions of the ITB also contained the following relevant provision: 7. As the best interest of the State may require, the right is reserved to make award(s) by individual service, group of services, all or none, or a combination thereof, to reject any and all bids or waive any minor irregularity or technicality in bids received. After the bids were opened and the tie was noted, the bids were sent to the Department's public information director, Kathleen Snoeblen, for further evaluation consistent with legal counsel's advice. Based upon two conversations with a Business Wire representative and one with a representative of PR Newswire, but without making an independent check to verify the accuracy of their responses, Snoeblen concluded that Business Wire served 33 media points via computer link while PR Newswire served only 29. Using this as the yardstick for breaking the tie, Snoeblen recommended that Business Wire be given the contract. This advice was conveyed to the Department's Division of Administration by memorandum dated March 7, 1989. A proposed award of the contract to Business Wire followed. After proposed agency action was issued, there was no informal conference with the bidders in an attempt to informally resolve the matter. After further review of the proposals, Snoeblen acknowledged at hearing that her original evaluation was incorrect and that Business Wire could only serve 31 media points via computer link rather than 33. However, this meant it still served two more points than PR Newswire. At hearing, PR Newswire established that the Department's evaluation of media points was flawed. This was because a press release might be sent via computer to a primary media point which in turn distributed the same release to other media points in the area. In evaluating the bid proposals for purposes of breaking the tie, the Department counted as computer link points not only the original media point but also any secondary points listed by the bidder that received the release from the original point. For example, a feed sent by Business Wire to the Stuart News was then conveyed by that newspaper to the Port St. Lucie News, Stuart Mirror, and Hobe Sound/Port Salerno Mirror, all being smaller newspapers or "shoppers" ostensibly owned or controlled by the primary media point. However, the secondary points (including "shoppers") were considered computer link points within the meaning of the ITB even though the wire service had sent only one release to a single media point. Neither bidder was aware of the procedure that would be used in the event of a tie. In addition, both petitioner and intervenor complained that there were definitional problems with the term "computer link" as used by the Department. Had petitioner known of these matters prior to its bid submission, it would have structured its proposal differently. More specifically, it would have concentrated on listing primary computer link points as well as secondary points so as to reflect a larger number of points that it served. In its proposal, PR Newswire did not list secondary points since it was under the impression that only primary points could be used. By not being given the opportunity to submit a responsive proposal, PR Newswire was placed at a competitive disadvantage in the bidding process.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that a Final Order be entered rejecting both bids and releting Invitation To Bid No. DIT-88/89-112. DONE AND ORDERED this 23rd day of May, 1989, in Tallahassee, Leon County, Florida. DONALD R. ALEXANDER Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904)488-9675 Filed with the Clerk of the Division of Administrative Hearings this 23rd day of May, 1989.
Findings Of Fact At all times relevant hereto, Phyllis A. Crosby, Respondent, was registered as a real estate broker by the Florida Board of Real Estate, and was qualifying broker for Crosby Realty Corporation, a corporate real estate broker (Exhibit 4). Crosby had actual knowledge of the hearing scheduled to be heard September 3, 1986, and failed to appear. William Nolte and Marilyn Nolte owned a duplex in Tampa, Florida that they desired to sell. They talked with Wade Black and Dale Peterson, real estate salesmen with American Realty Company, and agreed to give American Realty Company an exclusive right of sale agreement, a listing agreement to list the property for rent before sale, and to pay a $100 commission for each tenant. The exclusive listing agreement dated February 26, 1985 was attached to Exhibit 2, deposition of Marilyn Nolte, as Exhibit 2. Pursuant to these agreements, tenants for each of the apartments were obtained and a buyer for the property was subsequently found. In March 1985, Crosby purchased American Realty's assets which included the Nolte agreements. Salesmen licenses of Black and Peterson were transferred to Crosby Realty. Rental and deposit checks from the two tenants, totalling $1,130.00, were obtained by Black and/or Peterson and delivered to Respondent. This money was never deposited into Respondent's escrow account. The Noltes demanded remittance of the $1,130.00 minus $200 (commission), or $930.00 from Respondent on numerous occasions and made numerous phone calls to the Crosby Realty Company office to obtain this money without success. On March 13, 1985, a buyer for the Nolte property was secured by Tam- Bay Realty, and the property was sold with the closing taking place June 9, 1985. Prior to the closing, Nolte wrote to the American Title Company, who closed the transaction, regarding the $930.00 owed Nolte by Respondent and this $930.00 was deducted from the commission paid Respondent. At the closing, Respondent appeared, took the check representing Crosby Realty's Commission less the $930.00 deducted to pay Nolte, and left before the final papers were signed. No commission for the rentals of the sale was ever paid by Respondent to Black or Peterson. Respondent, during 1985, had three accounts in the Citrus Park Bank in Tampa. One was the Crosby escrow account, one was the Crosby Realty general account, and one was the Phyllis A. Crosby personal expense account. Numerous overdrafts were drawn on the general account and personal expenses account and the bank notified the Respondent that these overdraft charges would be deducted from her escrow account as a set-off to keep the bank from losing money because of these overdraft charges. During June 1985, the bank debited the escrow account $88.50 (debit memo Exhibit 1), the July statement contained a debit memo of $283.00, and in August, debit memos of $126.76 and $62.88 appeared. In September 1985, Citrus Park Bank closed all of Respondent's accounts. On April 29, 1985, Respondent leased office space and a townhouse from Carlton Properties in Tampa. She signed a three-year lease effective May 1, 1985, which provided for two months free rent for the office, with tenant to make a security deposit in the amount of $817.79 (which equals one month rent) due June 1, 1985. This deposit was never made and she was evicted in July. The townhouse lease provided for two weeks free rent with the security deposit due May 15, 1985. Respondent made this payment and one additional payment, but the check for the second payment was returned marked insufficient funds. She was evicted July 22, 1985. Respondent leased office space on July 9, 1985, from Ayers-Siera Insurance Association in the Carrolwood Village Center for a broker's office. She gave the lessor a check for $842.00 for the August rent and a security deposit. She moved into the office space and the check, written on the Crosby Realty general account, bounced. It was returned for collection twice, marked insufficient funds. When run through a third time, the check was returned marked "account closed." Eviction proceedings were instituted and Respondent's furniture was moved out of the office by the Sheriff in early October. The lessor has never received any monies from Respondent. In September or early October 1985, Respondent entered into a three year lease agreement with Paramount Triangle to lease office space commencing November 1, 1985. She moved her offices into that space and occupied the premises until April or May 1986 when she departed. During the period that Respondent occupied this office space, only one rental check from her was honored by the bank. Numerous checks given to Paramount Triangle for rent were not honored by the bank. Finally, the last check from Respondent dated March 6, 1986, which Paramount Triangle tried to deposit, was returned showing the account on which the check was drawn was closed on March 4, 1986. Pamela Glass was employed as a secretary by Respondent from July 6, 1986 through August 6, 1986. During this period, Respondent refused to accept certified mail and became very angry with Glass when she once signed for a certified letter addressed to Respondent. Glass received numerous phone calls from people complaining about not being paid for billing sent to Respondent. When her pay was not forthcoming at the end of the month, Glass quit. Glass also testified, without contradiction, that Respondent held accounts for utilities under various aliases she used for this purpose. Frank Maye, investigator for Petitioner, failed to get escrow account records from Respondent when requested and made appointments with her to audit her escrow accounts which were not kept by Respondent. Failing to obtain the records from Respondent, Maye subpoenaed the records from the bank.
Findings Of Fact Petitioner, James A. Wade, Jr., began employment with Respondent, Li'l General Stores, Inc. (Li'l General), on October 4, 1979. He had responded to an advertisement in the Orlando, Florida, newspaper for applicants for its management candidate program, one of the criteria for which was a college degree. There was no other training called for as a prerequisite, though an examination was required. Petitioner was a college graduate with a bachelor of science degree in Business Administration. The examination Petitioner took showed he lacked adequate retail experience, but he was kept in the program with the understanding he would be retested within one year. Though Petitioner requested retesting of his superior several times (he contends at least six), he was never retested, and whenever he requested retesting, he was told the prior failure to do so was an oversight and that someone would be up to test him in a few days. No one ever came to do so, however, even though Respondent's division manager over Petitioner, Val Draper, admits he recommended that Petitioner be retested. Petitioner worked for Respondent for two and one-half years as a store manager, even while awaiting retesting, having overall supervision of the stores in his charge. His immediate supervisor during the majority of this time was Ed Curtis, who, Petitioner contends, rated him on several occasions. All of these ratings, he contends, were good even though, for the most part, they were oral ratings not reduced to writing. There is, however, included in Respondent's Composite Exhibit A, a "Training Supervisor Orientation Program Training Report" dated January 20, 1981, and signed by Harry Economou, a training supervisor for Respondent, which bore "good" ratings (the highest available) in all four rated areas and the additional comment, "qualified for training supervisor." It is also noted that a payroll change form signed by Ed Curtis on December 17, 1980, when Petitioner was given a promotion and pay raise from $4.40 per hour to $4.80 per hour, bears the comment, "James has been doing a good job as manager at Store 1402-69 and is being transferred to Store 1402-44 (later properly identified as Store 1402-09), as the training store manager." During all this time, claims Petitioner, the position he wanted in the management candidate program was still open, as evidenced, he states, by the fact that the recruitment advertisements were still being run in the commercial paper and the position was listed in the internal newsletter received in the store. The management candidate program trains personnel for employment as district managers. The store manager positions he held do not come within the program. During the last two weeks of his employment with Respondent, Petitioner worked for a Ms. Porter, who replaced Mr. Curtis as District Manager, the position he had wanted. She came to his store several times during this period, at which times Petitioner asked her about his retesting. He finally told her if he was not retested, he would go to the "EEOC." It was at this point, he contends, his troubles began. Within a short while of his former comment to Ms. Porter, his store was audited on January 5, 1982, by Respondent's personnel, who found a shortage of in excess of $1,800.00. On the same day, Ms. Porter gave Petitioner a memorandum on the security of the cigarette cabinet, referring to a discussion they had had the week previous on the same subject. This memorandum also reflects two handwritten notations dated January 8, 1983, that the cabinet was found unlocked at 6:00 p.m. that date. Petitioner contends that in the oral discussion with Ms. Porter about the cigarette cabinet, she merely told him to keep it locked. He contends he was not told then that any disciplinary action would be taken against him for failing to do so. That argument is not persuasive, however, as the Respondent's Employee Rules of Conduct clearly reflect "automatic discharge" as the penalty for any "gross negligence which results in substantial cash loss," and permit suspension or termination for "failure to control inventory shortages." Though there is no direct evidence Petitioner was given a copy of this, presumably he was. As to the audit shortage, Petitioner contends that, based on the inventory methods utilized by Respondent, there is no way to show what items are missing--only a dollar amount and that the failure to control security of the cigarette cabinet could not have accounted for the $1,800.00 loss because his physical count of the cigarettes done when Ms. Porter talked with him the first time it was left open revealed the only cigarettes not in there were an off brand which had been sold. Mr. Draper, on the other hand, indicates that shortages can generally be identified through a comparison of section counts to the reports of previous audits. Cigarette and beverage cooler counts are done in the stores on a daily basis. Audits are conducted by a professional auditor who physically counts the store (inventory) and compares that count with the Division figure. While there was no showing by direct evidence that this was done here, again, presumably a regular procedure was followed here. Petitioner also attacks the accuracy of the shortage found in the audit through his testimony that approximately ten days before the audit, he had trouble with the cash register in the store, and for approximately four days, he had no working cash register. Petitioner contends he reported this to Ms. Porter and also called the supplier, who, he contends, called the Respondent corporation to get permission to put in a noncompany register while the broken one was being fixed. This offer was reportedly refused by Respondent. Again, there is no direct evidence that this happened with the recitation coming only from Petitioner, and Mr. Draper contests this. The ultimate responsibility for insuring a store has a cash register lies with the District Manager, and it is Draper's policy to either have the machine fixed on the spot or replaced with a loaner from Respondent's stocks. To the best of Draper's knowledge, this store was not left without a register for four days. He cannot, however, equivocally state what Petitioner contends is not true. Weighing the probabilities, however, the scale here tilts in favor of Respondent. It is not likely that a firm so large as Respondent, whose operation is so open to theft and pilferage as this is, would allow one of its stores, which evidence shows does from $15,000 to $30,000 per month in business, to go without a cash register for 4 1/2 days. Petitioner contends, as an additional basis for his complaint, that he did not receive a pay raise during the 2 1/2 years he was employed by the company and that all he received was a gas premium and pay for a management trainee. He further contends that all of the Caucasian store managers received higher pay raises than he. This latter contention is rebutted in documentation submitted by Respondent without objection by Petitioner which indicates that of 20 store managers listed, only four were earning more than Petitioner and one of those had prior convenience store experience. As to the former, it appears that on December 11, 1980, Petitioner was given an hourly pay raise from $4.40 to $4.80. The increase is identified as "salary" and "hourly," not to gas premium, and is justified by his transfer to another store and assignment as a training store manager. With the increase in responsibility goes the increase in pay. Petitioner contends that when he was discharged, he was given no reason for that action by Ms. Porter or Mr. Draper when he went to Draper's office to request one. He was terminated on January 12, 1982, by Ms. Porter, who on the Employee Action form listed as reasons therefor violations of company policy and continued poor performance, inter alia. It is not known whether these reasons were communicated to Petitioner, but from the state of the evidence, it may be concluded he was not. However, Ms. Porter's reasons for taking the termination action are clearly outlined in her memorandum relating to Petitioner found as the first attachment to Respondent's Composite Exhibit, admitted without objection of the Petitioner. This memo reflects a lack of leadership by Petitioner in correcting his employee attitude and performance and substandard performance in both store condition and the accomplishment of paperwork. The factor culminating in Petitioner's discharge is the repeated failure to control the cigarette cabinet, and Petitioner's contention that it was his assistant manager who was the culprit does not excuse him. As the manager, he was the responsible party and must bear the consequences of his failure to shoulder that responsibility. This situation is not offset by the fact that he had previously warned Ms. Porter that one of his employees had a record of dishonesty and was prevented from discharging this person, who, it must be added, was working in the store during the period of the inoperative register. 13,. Mr. Wade also contends that on one occasion, he was advised (by whom is unknown) that he must transfer to a different store located in a tough, black neighborhood because he is black. He refused the voluntary reassignment and states that while he was subsequently on vacation, he was involuntarily transferred there and told that if he wanted to stay with the company, he would have to accept the assignment.
Recommendation Based on the foregoing, it is, therefore, RECOMMENDED THAT the Petition of James A. Wade, Jr., be denied. RECOMMENDED this 29th day of May, 1984, in Tallahassee, Florida. ARNOLD H. POLLOCK Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 29th day of May, 1984. COPIES FURNISHED: Diana Kilpatrick, Esquire Post Office Box 2009 Daytona Beach, Florida 32017 Mr. Phillip S. Youtz Personnel Manager Gold Coast Region Li'l General Stores, Inc. 4191 North State Road 7 Lauderdale Lakes, Florida 33319 John R. Ficarro, Esquire Post Office Box 13198 Tampa, Florida 33681 Aurelio Durana, Esquire General Counsel Florida Commission on Human Relations 325 John Knox Road Suite 240, Building F Tallahassee, Florida 32303 Mr. Donald A. Griffin Executive Director Florida Commission on Human Relations 325 John Knox Road Suite 240, Building F Tallahassee, Florida 32303
The Issue An Administrative Complaint and cease and desist order was filed by the Department of Banking and Finance on March 29, 1990, against Respondent and thirty-one other persons, alleging various violations of Chapter 517, F.S., the "Florida Securities and Investor Protection Act". The only allegation of wrongdoing by Robert Micalizio is that he offered or sold an unregistered security in violation of Section 517.07, F.S. He admits contacting investors, but claims those contacts were to obtain indications of interest (IOI) which are not proscribed. The issue for resolution in this proceeding is whether Respondent committed the alleged violation and if so, what discipline is appropriate.
Findings Of Fact The following facts are reflected in the parties' prehearing stipulation filed on February 11, 1991, and required no proof at hearing: Robert Micalizio was registered with the Department as an associated person of Thomas James Associates, Inc., from on or about February 1, 1987 until the termination of his registration with Thomas James Associates, Inc., on or about June 16th, 1989. During all times Robert Micalizio was registered with the Department, he was simultaneously registered with the National Association of Securities Dealers. He is currently employed as an associated person at Advantage Capital Corporation. Thomas James Associates, Inc., offered to the public, units, shares, and warrants of Electronic Assembly Services, Inc., from their offices in Florida. Electronic Assembly Services, Inc., was a "firm commitment" securities offering underwritten by Thomas James Associates, Inc. A unit of Electronic Assembly Services, Inc., consisted of four (4) shares of common stock plus two (2) common stock purchase warrants and was sold to the public for two dollars ($2.00) per unit. The units, shares, and warrants of Electronic Assembly Services, Inc., were securities as that term is defined by Section 517.021, Florida Statutes. The effective date of the offering (that is the date at which the units could first legally be sold) was July 6th, 1988. The initial public offering of Electronic Assembly Services, Inc., consisted of 1.5 million units which were offered to the public at two dollars ($2.00) per unit. The total number of units sold of Electronic Assembly Services, Inc., by Robert Micalizio was eleven thousand one hundred and fifty (11,150) for a total price to the customer of twenty two thousand three hundred dollars ($22,300.00). The commissions received by Robert Micalizio on these sales were approximately six hundred and thirty-nine dollars ($639.00). These facts are adduced from the evidence presented at hearing, including the weighing of credibility of the witnesses: Robert Micalizio is 29 years old, and his association with Thomas James was his first job in the securities field. Nonetheless, prior to obtaining his Series 7 Registration with the State of Florida and with the National Association of Securities Dealers (NASD), in order to sell stocks, bonds and mutual funds, he had to take and pass a test covering rules and regulations of the Security & Exchange Commission (SEC) and other matters. He also studied Florida laws governing the sale of securities. Rule 3E-600.005, F.A.C., in effect at the time Micalizio became registered, requires every applicant for registration to execute and submit a notarized affidavit attesting to the applicant's knowledge and review of the Florida Security Act. His training on how to handle clients and make sales was from salesmen at Thomas James. On or before June 21, 1988, Robert Micalizio contacted William Furnas about the purchase of units of Electronic Assembly Services, Inc. Furnas already had an account with Thomas James and had dealt with Micalizio before on other securities offerings. During that conversation Furnas placed an order for 750 units, at $2.00 a unit. He mailed his check for $1,500.00 on the 21st or 22nd to Thomas James Associates (check #1109, dated June 21, 1988). William Furnas does not remember whether Micalizio told him the securities were unregistered, but he was not told that he could cancel his order. Furnas' check appears on the Thomas James Associates office log as received on June 23rd. Because the Electronic Assembly Services offering was oversold, the company allotted only 575 units to William Furnas. The remainder of the $1,500.00 was used to purchase another security from Mr. Micalizio. William Furnas received his prospectus on Electronic Assembly Services sometime after July 13, 1988, when he received confirmation of his purchase. On June 21 or 22, 1988, Robert Micalizio contacted Dorothy Gerjovich, by telephone, at her home in Orlando. He asked her to purchase units of Electronic Assembly Services, telling her that it was a good company. She agreed to the purchase, and he told her how much she owed. He did not tell her she could cancel the transaction; nor did he tell her the securities were not registered. She wrote her check for $1,000.00 on June 22, 1988, and mailed it to Thomas James Associates, where it was logged as received on June 27, 1988. Sometime after mailing her check, Dorothy Gerjovich received her prospectus for Electronic Assembly Services. Although he does not acknowledge the date of sale, Robert Micalizio acknowledges selling Electronic Assembly Services units to Glen R. and Margaret Callin. A check from them in the amount of $1,200.00 dated June 24, 1988, and marked "for ELAS", was logged in at Thomas James Associates on June 27th. The check log was obtained by Donna Mezger, an examiner for the Department of Banking and Finance, Division of Securities, during her investigation of Thomas James Associates, Inc. It was given to her by a clerk at Thomas James upon her request when she first came to do her investigation. It is required to be maintained by SEC regulations and by the Division of Securities. Under normal circumstances, a security is registered with the Florida Department of Banking and Finance or the SEC, or both agencies. The agency review prior to registration is to determine whether the offering is fair, just and equitable and whether there is proper disclosure of material information in the prospectus. Unless and until the offering is registered, the statutory protection of the investor is not available. An "indication of interest" (IOI) is a process by which broker/dealers and associated persons try to determine how much interest there is in a public offering that is about to come to market. Many firms do firm commitment underwritings; that is, they agree to purchase securities from an issuer and resell them to the public. The IOI allows the broker/dealer to determine how much demand there is for the security he is getting ready to sell so that he can anticipate the risk. Generally an IOI is done by contacting customers and explaining the offering to them and sending them a preliminary prospectus for review. This prospectus is called a "red herring" because of the red language on the cover, alerting the customer that it is preliminary only. The preliminary prospectus is authorized during the waiting period between filing the registration statement and the time it is declared effective. The customer may indicate to the firm whether they are interested and how many shares they might purchase after the offering is determined effective. It is appropriate and legal for a broker or associate to take IOI's, as opposed to making an offer or sale, prior to the effective date of registration. The Department of Banking and Finance has an established policy of looking at whether the money has been accepted in determining whether there has been a "sale" of securities. There is no statutory definition of "indication of interest", but there are SEC statements of policy describing it. Robert Micalizio had a grasp of what an IOI is. At some point in the course of his employment with Thomas James he was instructed that an IOI is a firm commitment. He disagreed with this as he knew that the regulations provided that an IOI could be cancelled before a stock starts trading publicly. Robert Micalizio's statements regarding what he told his customers were contradictory and disingenuous. In a sworn affidavit given to Donna Mezger in which he was allowed to make changes, he stated that he told customers that an IOI is a firm commitment because that is what he was told to say. He also stated that he considered his customers as astute investors, and since it was not in a script anywhere, he would tell them they could cancel an IOI only if they asked. At hearing, he said that he always told clients that an IOI could be cancelled at anytime. It is clear that he did not tell William Furnas or Dorothy Gerjovich that they could cancel their June 1988 orders for Electronics Assembly Services units. It is also clear that these customers correctly assumed they were making purchases of securities, not simply indications of interest, when Micalizio contacted them prior to the effective date of registration. He knew that they were making that assumption, according to his statement to Donna Mezger. Petitioner has no written disciplinary guidelines, but in similar cases involving sales of unregistered securities has imposed a suspension, fine, and a registration agreement restricting the registrant's practice and requiring supervision by his employer.
Recommendation Based on the foregoing, it is hereby, recommended that a final order be entered finding Robert Micalizio guilty of violating Section 517.07, F.S., suspending his registration for two years and imposing an administrative fine of $639.00, the amount of commissions he earned on the unregistered sales. RECOMMENDED this 17th day of April, 1991, in Tallahassee, Leon County, Florida. MARY CLARK Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904)488-9675 Filed with the Clerk of the Division of Administrative Hearings this 17th day of April, 1991. APPENDIX TO RECOMMENDED ORDER, CASE NO. 90-2509 The following constitute specific rulings on the findings of fact proposed by the parties: Petitioner's Proposed Findings 1. and 2. Adopted in statement of the issues and preliminary statement. Adopted in paragraph 1. and 5. Adopted in paragraph 2. Adopted in paragraph 3. Adopted in paragraph 5. and 9. Adopted in paragraph 7. Adopted in paragraph 9. - 13. Adopted in paragraph 10. 14. and 15. Adopted in paragraph 11. Adopted in paragraph 12. and 18. Rejected as unnecessary. Adopted in paragraphs 8, 10 and 11. and 21. Adopted in paragraph 13. Rejected as immaterial. Adopted in paragraph 14. Adopted in paragraphs 15 and 16. and 26. Rejected as unnecessary. 27. - 30. Adopted in substance in paragraph 18. 31. Adopted in paragraph 19. Respondent's Proposed Findings of Fact Adopted in paragraph 1. Adopted in paragraph 16. Adopted in paragraph 14. Adopted in paragraph 15. Adopted in paragraph 6. Rejected as contrary to the weight of evidence. Rejected as unnecessary and immaterial. The manner by which Respondent designated the transaction, the notation itself, does not prove the transaction was an IOI. More credible evidence established that it was not. Adopted in paragraph 14. Rejected as unnecessary. and 11. Rejected as contrary to the weight of evidence. Rejected as unnecessary (as to not telling customers the stock was registered). The fact that he told customers that the IOI could be cancelled would tend to prove that even Respondent considered the Furnas and Gerjovich contacts as something more than an IOI, since he did not tell them the order could be cancelled. - 18. Rejected as immaterial. Adopted in paragraph 7, as to Furnas. Otherwise rejected as unsubstantiated by clear, competent evidence. Adopted in paragraph 9. Rejected as contrary to the evidence. There is no written policy, but a policy has been established through a series of cases dealing with discipline in a uniform manner. Adopted in paragraph 16. Rejected as unnecessary. There are plain definitions of "offer to sell" and "sale", and if the transactions meet those definitions, as these did, they are not mere IOIs. COPIES FURNISHED: Robert K. Good Asst. General Counsel Office of the Comptroller Hurston South Tower, #S225 400 W. Robinson Street Orlando, FL 32801 Gina Micalizio 237 Quayside Circle Maitland, FL 32751 Hon. Gerald Lewis, Comptroller Dept. of Banking and Finance The Capitol, Plaza Level Tallahassee, FL 32399-0350 William G. Reeves, General Counsel Dept. of Banking and Finance The Capitol Plaza Level, Rm. 1302 Tallahassee, FL 32399-0350
Findings Of Fact Applicant, Ester Woods Vickery, applied for a beverage license for the premises known as "Vickery's Grocery" located one mile south of Bear Creek on U.S. Highway 231, Bay County, Florida. Said application was denied by the Petitioner for the following reason: "Husband of applicant who has a direct or indirect interest In the business has been convicted of felonies in the past 15 years." Respondent requested a hearing contending that she is the sole owner of the business and that her husband has no direct or indirect interest in the business and is merely one of her paid employees. The Petitioner contends that the business was bought using funds from an account of Mrs. Vickery, the money of which was obtained from the sale of property owned jointly by Mr. and Mrs. Vickery. The Petitioner further contends that it is a man's obligation to support his wife and that Mr. Vickery's sole support is his work with Vickery's Grocery; that the conviction of Mr. Vickery of felonies during the past 15 years which involved the sale of "moonshine liquors" makes it mandatory under Section 561.15 and Section 561.17, Florida Statutes, that the application for a beverage license be denied. It was admitted by the Respondent that Esther Woods Vickery is married to a person who has been convicted of felonies in the past 15 years. It was also admitted by the Respondent that Mr. and Mrs. Vickery owned jointly property from which timber was cut and sold and the profit was deposited in a savings account in the name of Mrs. Vickery. The savings account from which money was drawn to purchase Vickery's Grocery was in Mrs. Vickery's name alone. Said savings account was established at some time before the purchase of Vickery's Grocery. The business was purchased from Mr. Hickman, the owner of the premises, who testified that he had leased the premises to Mrs. Vickery; that he had made all negotiations concerning the lease and the selling of the business with Mrs. Vickery and that he had not dealt in any way with Mr. Vickery in regard to the sale of the property. Mr. Hickman lives near the grocery business and testified that Mrs. Vickery runs the business herself. Mr. Vickery, the husband of the Respondent, is shown on the payroll to be on the payroll of Mrs. Vickery and draws a specified salary payment for work in the business which involves the sale of gas and oil and well as groceries. The Hearing Officer further finds: That the Respondent, Esther Woods Vickery, is the sole owner of the establishment known as "Vickery's Grocery" and that the husband of Mrs. Vickery is an employee of the establishment and has no direct or indirect interest in the business.
Recommendation Approve the application for a beverage license of Esther Woods Vickery for the business premises "Vickery's Grocery", providing she meets all other requirements than those which are the subject of the disapproval of her application and of this hearing. DONE and ORDERED this 7th day of May, 1976. DELPHENE C. STRICKLAND Hearing Officer Division of Administrative Hearings Room 530, Carlton Building Tallahassee, Florida 32304 (904) 488-9675 COPIES FURNISHED: Charles Tunnicliff, Esquire Staff Attorney Division of Beverage The Johns Building Tallahassee, Florida 32304 Franklin R. Harrison, Esquire 406 Magnolia Avenue Panama City, Florida 32401 Charles Nuzum, Director Division of Beverage Department of Business Regulation The Johns Building Tallahassee, Florida 32304
The Issue Whether the Department of General Services should disqualify as unresponsive Kodak's bid for Classes 11 and 12, Types I, III, IV of Bid No. 402- 600-38-B, Walk-Up Convenience Copiers, Plain Bond Paper.
Findings Of Fact The Department is the state agency empowered to contract for the purchase, lease, or acquisition of all commodities required by any state agency under competition bidding or by contractual negotiation. On April 26, 1984, the Department issued Invitation to Bid No. 402-600- 38-8 entitled Walk-up Convenience Copiers, Plain Bond Paper. The bid invitation categorized walk-up convenience copiers by type, class, and acquisition plan. The specifications provided for four types and twelve classes of copiers with four acquisition plans--one-year lease, two-year lease, three-year lease, and outright purchase. Kodak responded to the bid invitation on June 26, 1984, by submitting bids on all acquisition plans for the following categories: Type I, Classes 8- 12; Type II, Class 12, Type III, Classes 8-12; and Type IV, Classes 8-12. The Department posted its decision on the Copier Bid on August 9, 1984, at which time the Department indicated its intent to reject all bids submittsd by Kodak on the ground that Kodak's bid contained additional terms and conditions. Addendum A to Kodak's bids contains the language which the Department found to be additional terms and conditions and consists of an explanation of a quantity discount offered by Kodak to all state agencies. Kodak's bids were the lowest bids received by the Department of the two-and three-year lease plans for the following categories: Type I, Classes 11 and 12 Type III, Classes 11 and 12 Type IV, Classes 11 and 12 In addition, Kodak's bids were the lowest bids for the one-year lease plans on Class 12 of Type I, III, and IV. The quantity discount reflected in Addendum A does not affect the bid prices (price per copy made) submitted by Kodak for any of the machine categories or acquisition plans on which Kodak bid and was not considered by the Department in finding Kodak to be the low bidder in those categories specified above. The invitation to bid (ITB) contains general and special conditions. The "general conditions" are conditions that apply to all contracts bid by the state; the "special conditions" are the terms and conditions that apply specifically to the invitation to bid under consideration. The general conditions provide that "[a]ny and all special conditions and specifications attached hereto which vary from these general conditions shall have precedence." Section 4(b) of the general conditions provides: "Under Florida law use of State contracts shall be available to political subdivisions (county, county board of public instruction, municipal, or other local public agency or authority) and State Universities, which may desire to purchase under the terms and conditions of the contract. Such purchases shall be exempt from the competitive bid requirements otherwise applying to their purchases." The special conditions set forth the purpose of the bid as the establishment of "....a 12 month contract for the purchase of Walk-up Convenience Copiers: Plain Bond Paper by all State of Florida agencies and institutions." The purpose provision does not mention political subdivisions. However, several special conditions of the ITB refer to political subdivisions. Under "Estimated Quantities" it states: "It is anticipated that the State of Florida agencies and other eligible users will expend approximately $1,000,000 under any term contract resulting from this bid." Other eligible users include political subdivisions. The condition entitled "Distribution of Literature" provides: "Successful bidder will be required to furnish State agencies and political subdivisions...with descriptive literature..." The condition entitled "Summary of Total Sales" provides that "Total Dollar sales to political subdivisions may be submitted in lieu of the detailed information required for State and university placements." Although political subdivisions may purchase under the terms and conditions of the state copier contract, certain of the special conditions distinquish between state agencies and political subdivisions. As mentioned above, the ITB provides that total dollar sales to political subdivisions may be submitted in lieu of the information required for state and university placement. Further, the ITB requires each bidder to identify its equity accrual plan and sets forth minimum requirements that the plan must meet. One of the minimum requirements refers to State agencies only, directing that "[t]he State shall have the right to transfer the equipment from one State agency to another State agency without the loss of equity accrued." The special condition at issue in this proceeding is entitled" Quantity Discounts". It provides: "Bidder is urged to offer additional discounts for one time delivery of large single orders of any assortment of items." In response to this provision, Kodak included as part of its bid "Addendum A", which reflects the quantity discount offered by Kodak to major customers. The discounts offered by Kodak are based upon the total number of machines installed in state agencies at the time invoices are sent out. If the state has fewer than seventy-five machines installed, it enjoys no discount and pays the full amount indicated on the price sheets submitted in Kodak's bid. If a seventy-fifth machine is installed, the state receives a two percent discount off the bottom line of each monthly invoice on all Kodak machines installed. When the number of Kodak machines exceeds 149 the state receives a three percent discount, and when the number of machines exceeds 199, a four percent discount is applied. When the discount level changes either up or down due to a change in the machine base, Kodak provides 60 days advance written notice prior to applying the new discount level. Kodak's billing system utilizes a computer which tracks the number of machines and applies the quantity discounts. Each individual account or customer has a "custom master" in the computer, which is a computer record consisting of the name of the company, the address, the customer number, and information concerning invoices. The "custom master" is used in billing the customer. When quantity discounts are involved, a master agreement number and/or a common owner number is assigned and that number is placed on each individual custom master in the system that comes under the master agreement. Thus, each individual account has both an individual customer number and a master agreement number. When the computer prepares the bill, it automatically counts the number of machines installed with all customers who share the same master agreement number. Because of the billing system, any machine that is included in the billing is also included in determining the quantity discount. If the machine is not counted in the machine base, the customer is not being charged for the machine. Paragraph II of Addendum A provides: 11. Eligible Users Eligibility under the Quantity Discount Schedule listed below will be exclusively for installations of KODAK EKTAPRINT Copier-Duplicator and Duplicator models within the State of Florida's Government departments, agencies, and State universities. The Quantity Discount Schedule does not apply to installations of KODAK EKTAPRINT Copier-Duplicator and Duplicator models within political subdivisions in the State of Florida (county, county board of public instruction, municipal, or other local public agency or authority). This provision prevents the state from receiving discounts based upon machines purchased by political subdivisions, and also prevents political subdivisions from receiving quantity discount credit for machines placed with state agencies and universities. In other words, the machine base for state agencies and universities would be determined solely by the number of machines installed with state agencies and universities; machines installed within political subdivisions would not be counted in that machine base because political subdivisions would not have the master agreement number assigned to state agencies and universities. Although Kodak contends that each political subdivision would be eligible for quantity discounts based upon the number of machines installed within that particular political subdivision, that provision was not included in Addendum A. Kodak did not address political subdivisions in the quantity discount provision because the purpose of the ITB, as stated in the special conditions, was to establish a contract for state agencies and because the quantity discount provision did not specify that any quantity discounts offered must include political subdivisions. After the copier contract is awarded, each eligible user places its orders for copiers from the contract. The orders do not go through the Department, and the Department does not have a system that indicates how many machines are installed in state agencies and universities. Although the Department does not have a system for independently monitoring the number of machines installed, under Kodak's billing system the state may elect to receive a monthly or quarterly printout which lists each machine installed by its purchaser and provides information relating to the machine's location, type, and acquisition plan. In addition, the state may designate a central location to receive copies of all invoices sent out on each machine installed within the state system. The Department determined that Kodak's bids should be disqualified as containing additional terms and conditions. Specifically, the provision of Addendum A excluding political subdivisions from participation in the quantity discount offered and the Department's inability to independently monitor the quantity discount were identified as the additional terms and conditions. If not for Addendum A, Kodak would have been awarded the contract on the categories for which it was the low bidder. Had Kodak failed to provide any quantity discounts it would have been awarded the contract. Had Kodak omitted Addendum A from its bids, but automatically accorded to the state its quantity discount through its billing system, the state would have paid the discounted prices. The inclusion of Addendum A in its bids does not give Kodak an advantage or benefit not enjoyed by other bidders. All bidders were "urged to offer additional discounts...; however, the quantity discounts offered were not considered in determining the low bidder. Therefore, the inclusion of the quantity discount offered by Kodak could not have given it a competitive advantage not enjoyed by other bidders. The inclusion of Addendum A does not adversely impact the interests of eligible users of state contracts. Had Addendum A not been included in Kodak's bids, Kodak would have been awarded the contract in the categories previously specified, and all eligible users would pay the full contract price. Political subdivisions are not adversely affected by the inclusion of Addendum A because they will pay no more than they would have paid had Kodak failed to provide any quantity discounts. State agencies and universities are not adversely affected by the quantity discount offered because they will pay the same or less than they would have paid had Kodak not included Addendum A.
Recommendation Based on the foregoing, it is RECOMMENDED that the State of Florida, Department of General Services, award to Eastman Kodak Company the following portions of Bid Number 402-600-38- B: Class 11, Types I, III, IV - two and three year lease. Class 12, Types I, III, IV - one, two and three year lease. DONE and ENTERED this 26th day of February, 1985, in Tallahassee, Florida. DIANE A. GRUBBS Hearing Officer Division of Administrative Hearings 2009 Apalachee Parkway The Oakland Building Tallahassee, Florida 32301 (904)488-9675 Filed with the Clerk of the Division of Administrative Hearings this 26th day of February, 1985.
Findings Of Fact Fundamental findings Petitioner, Christian Interactive Network, Inc., is a non-profit corporation exempt from tax under Section 501(c)(3) of the Internal Revenue Code. Petitioner's articles of incorporation provide that it is organized "[t]o operate, manage, run and otherwise do and perform those acts and things appropriate and proper for the conduct of the management and operation of a computer network, including, but not limited to the performance of services and installation or construction of the network, and purchase or writing of programing necessary to place such subsystem within the national and international computer information network system. Such computer network shall be and it is the intent hereof that the network be operated for the express purpose of Christian information and data access and for the purposes of glorifying God without personal financial gain as a motivating factor." To carry out its corporate purpose, petitioner leases approximately 3,000 square feet of office space at Suite 101, 505 Northwest 65th Court, Fort Lauderdale, Florida, wherein it maintains fifteen computers that are linked via the telephone network with the Internet. From its office location, petitioner provides an "on-line," "virtual area where people from around the world can gather . . ." in a computer networking area. There, petitioner organizes the data and electronic format for its on-line service, places leading ministries on-line, and monitors its programs and responses. Petitioner has no ministers on staff, but considers itself a "pathway" to the leading ministries by placing their program on-line, and by providing space for open forum discussion on Christian issues. Access to petitioner's resources and information is available through Internet access provided by commercial on-line services, Free-net on-line services, public access areas at libraries, and other providers or sources of Internet access. The religious activities petitioner presents on-line are of a character or nature that would qualify as "religious services and activities" under the "religious institutions" exemption provided by Section 212.08(7)(o)2, Florida Statutes; however, participants in petitioner's on-line service do not physically meet at petitioner's offices to participate in religious services, petitioner does not provide any service to physically transport its members or participants, and petitioner was not shown to be a "governing or administrative office[] . . . to assist or regulate the customary activities of religious organizations or members." The exemption at issue Here, petitioner has requested a consumer's certificate of exemption as a religious institution under the provisions of subsection 212.08(7)(o)2, Florida Statutes. Pertinent to this case, that subsection provides: The provisions of this section authorizing exemptions from tax shall be strictly defined, limited, and applied in each category as follows: "Religious institutions" means churches, synagogues, and established physical places for worship at which nonprofit religious services and activities are regularly conducted and carried on. The term "religious institu- tions" includes nonprofit corporations the sole purpose of which is to provide free transportation services to church members, their families, and other church attendees. The term "religious institutions" also includes state, district, or other governing or administrative offices the function of which is to assist or regulate the customary activities of religious organizations or members. 2/ It is petitioner's position that usage of computer on-line services, the so called Cyberspace or information super highway, is part of a rapidly changing technological environment wherein it provides an interactive meeting place to serve the spiritual needs of participants, nationally and globally, who might otherwise be unable to physically assemble. Such, petitioner contends, qualifies it as a "physical place[] of worship," a "provide[r] of free transportation services to church . . . attendees," or a "governing or administrative office[] the function of which is to assist or regulate the customary activities of religious organizations or members." Contrasted with petitioner's contention, the Department, consistent with the statutory mandate that the exemption for "religious institutions" be "strictly . . . limited" to that defined by the law, reads the provisions of subsection 212.08(7)(o)2a to apply only when (1) there exists an established physical place of worship, i.e., a "bricks and mortar" facility, (2) the organization provides physical transportation for church members or attendees, or (3) that the provider, who claims to be a "governing or administrative office" whose "function is to assist or regulate the customary activities of religious organizations or members," be part of a larger organization and, within the hierarchy of that larger organization, assist or regulate the activities of those beneath it in the organizational hierarchy. Such reading is consistent with the literal import of subsection 212.08(7)(o)2a, and to the extent the provisions of that subsection relating to "other governing or administrative offices" may be unclear, is a reasonable interpretation of such provision.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department enter a final order denying petitioner's application for a consumer's certificate of exemption as a religious institution. DONE AND ENTERED this 25th day of April 1996 in Tallahassee, Leon County, Florida. WILLIAM J. KENDRICK, Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 25th day of April 1996.
Findings Of Fact Upon consideration of the oral and documentary evidence adduced at the hearing, the following relevant findings of fact are made: Stipulated Facts: Petitioner submitted its application for DBE certification on or about July 27, 1993. Petitioner and Travel Professionals International Licensing Co., d/b/a Travel Professionals, Inc. (TPI) entered into a franchise agreement on September 28, 1993. Department conducted an on-site review of Petitioner's business on November 4, 1993. Department notified Petitioner of its intent to deny its application for DBE certification by certified mail on December 9, 1993. Petitioner requested a hearing pursuant to Section 120.57(1), Florida Statutes, on December 15, 1993. One hundred per cent of Petitioner's stock is owned by Jeanne Santo, a "socially and economically disadvantaged individual" as defined in Rule 14- 78.002(1), Florida Administrative Code, and therefore, Petitioner is in compliance with 14-78.005(7)(b), Florida Administrative Code. All securities which constitute ownership by Jeanne Santo are held directly by Jeanne Santo, and therefore Petitioner is in compliance with Rule 14-78.005(7)(d), Florida Administrative Code. The contributions of capital or expertise invested by Jeanne Santo are real and substantial, and therefore Petitioner is in compliance with Rule 14- 78.005(7)(f), Florida Administrative Code. The provisions of Rule 14-78.005(g) and (h), Florida Administrative Code, do not apply to Petitioner. The franchise agreement (Agreement) between Petitioner and TPI contains the following terms and conditions which are not in the agreements between Petitioner and Airlines Reporting Corporation (ARC); Petitioner and International Airlines Travel Agent Network (IATAN); and Petitioner and Systems One: a requirement that Petitioner locate its travel office only in "That portion of Pinellas County, Florida lying south of Florida State Highway 694". a requirement that Petitioner pay a quarterly advertising contribution. a requirement that Petitioner attend mandatory managers' meetings. ARC is customary in the travel agency industry. IATAN is customary in the travel agency industry. A leasing agreement for an automated reservation and ticketing system is customary in the travel industry. The Agreement requires that Petitioner be an ARC agent. Facts Not Stipulated The Fral Highway Administration (FHWA) is the federal agency that inisters the DBE program on the national level. The Department is the agency charged with the responsibility of administering the DBE program for the State of Florida. In making its determination of an applicant's eligibility for DBE, the Department considers: (a) Surface Transportation Uniform Relocation Assistance Act of 1987 (Public Law 100-17); (b) 49 CFR Part 23; (c) Chapter 339, Florida Statutes, (d) Chapter 14-78, Florida Administrative Code, (e) United States Department of Transportation (USDOT) administrative decisions; and (f) guidelines and training material from the FHWA or USDOT. The USDOT through FHWA provided the Department with a copy of DBE Program Administration Manual (Publication No. FHWA-HI-90-047, April, 1990) which the Department uses as a guideline for USDOT's and FWWA's interpretation of the DBE program. Below are portions of the Agreement which are pertinent to this preceeding: Purposes of this Agreement: We have developed the Travel Professionals International System (hereinafter called "the TPI System) for the operation of retail travel agencies, and we have developed policies, procedures and techniques that are designed to enable such agencies to compete more effectively in the travel market... You have requested our assistance, the use of the TPI Systems, and a franchise from us to operate a retail travel agency using the TPI System.... Franchise: We hereby grant to you and you hereby accept from us a franchise to operate a retail travel agency utilizing the TPI System, only at the following location(s): That portion of Pinellas County, Florida lying south of Florida State Highway 694. We will not establish another franchisee or agency owned by us within the territory described above, or establish other franchises or company owned outlets providing similar products and services under a different trade name or trademark or modify your territory without your written permission, so long as you are not in default under the terms of this Agreement.... You may move the office of the travel agency to a new location in the same general vicinity with our prior written approval, which approval will not be unreasonably withheld. You may not operate any additional office or location without our prior written consent, which consent will be given upon inspection and approval of such new premises.... Advertising Contributions: In addition to the service fees set forth above, you will be required to pay an "advertising contribution" in the amount of ONE HUNDRED FIFTY ($150.00) DOLLARS per quarter. We may adjust the advertising contribution annually on October 1, provided that any increase in the advertising contribution will be made only with the affirmative vote of at least fifty percent (50 percent) of the franchisees...The advertising contributions of all franchisees shall be placed in an advertising fund to be managed by us, and shall be used exclusively for advertising. Tradenames, Service Marks, Logos, Trade Secrets, and other Proprietary Matters: d. As you know, you will be given certain information about the Travel Professionals International System, our products and methods of doing business, as well as preferred supplier agreements, training and educational programs, computer operation and computer system arrangements, correspondence, memoranda, operating, sales and marketing manuals, and other confidential information. You recognize and acknowledge that this information is a valuable, special and unique asset belonging to us and constitutes our trade secrets which you agree to keep secret and not to disclose, during the operation of this Agreement, or after its termination or expiration, to any person or entity for any reason or purpose whatsoever.... Relationship of Parties: During the term of this Agreement, and any renewal term, you will be an independent contractor, and you will have no authority, expressed or implied, to bind us or to act as our agent, legal representative, or joint venturer. At our option, you will be required to describe yourself on all business forms, invoices, orders, stationery, and the like, as an independent licensee of Travel Professionals International, and to submit all such items to us for our written approval...The operation of your business shall be determined by your own judgment and discretion, subject only to the provisions of this Agreement and our policies and procedures, as they may be adopted or revised from time to time. We will not regulate the hiring or firing of your employees, the parties from whom you may accept business, the working conditions of your employees, or the terms of your contracts with your customers, except as may be necessary to protect the Travel Professionals International System. Service To Be Provided By Us: We will provide the following services to you pursuant to this Agreement: (b) We will prescribe certain standards of operation designed to enhance your profitability, which we shall expect you to follow. * * * (e) We may make recommendations to you regarding accounting and recordkeeping systems. * * * We will provide you with a policy manual, operations manual, preferred supplier manual, marketing manual, and an employee handbook which may be updated periodically. We will provide you with marketing, sales and promotional aids to include currently available professionally produced television spots, a series of high quality radio jingles, and from time to time, printed and other promotional material for use in your local area. We will operate an ongoing training program for you and your personnel. This program will include seminars, conferences, familiarization trips, and printed materials, such as bulletins and manuals, relating to marketing, management, and accounting procedures, and the like, and developments with the travel industry... * * * (l) We will provide, at no charge, up to five (5) person days of management expertise and sales effort effective on the first date of contract signing.... Your Obligation: During the term of this Agreement, and any renewal term, you will obligated to pay promptly to us any fees that are due hereunder, to maintain and keep such records and reports as we may prescribe, and to provide us with copies of such records and reports. You will be required to allow us to make inspection of your business and premises at any reasonable time, and to allow us to examine your books, tax returns and records during normal working hours. We reserve the right to establish a uniform accounting system to keep your books and records in conformity with such system. Your business shall be conducted in conformity with the provisions of this Agreement, with such policies and procedures as we may publish from time to time, and all state, federal and local laws and regulations.... You will be required to cause your chief operating officer or manager to attend our next available training program and to cause each of the franchise employees and principals (as shown on Schedule A attached hereto) to attend the required training courses set forth in our published policies and procedures. At present, mandatory training programs we provide include "New Owners Orientation", "New Manager Orientation", and the periodic "Managers Meetings". Although we are not obligated to do so, we offer, and plan to offer in the future, periodic (at least three times per year), Managers Meetings. Attendance at Managers Meetings, when offered, is mandatory. In the event you fail to send a representative to any Managers Meetings, then you shall pay to us the registration fee for that meeting, notwithstanding your lack of attendance at such meeting. Although paragraph 8 does require Petitioner to pay a fixed sum to TPI for advertising, it does not restrict the qualifying owner's exercise of control over the day-to-day decisions concerning advertising. In fact, TPI, under paragraph 11(i) of the Agreement, agrees to furnish certain materials to assist Petitioner in advertising on the local level. It is clear throughout the Agreement that the operation of the business is to be determined by the qualifying owner's own judgment and discretion subject to the provisions of the Agreement and TPI's policies and procedures which may be adopted or revised from time to time. Paragraph 4 , Terms of the Franchise, provides for the termination of the Agreement prior to its expiration date. It is clear from the qualifying owner's testimony ("Because nobody tells me what to do."), that she would terminate the Agreement rather than to allow TPI to exercise the day-to-day control of the business. There is no question that the qualifying owner has the authority to take such action under Paragraph 4 of the Agreement, if in no other manner, than by defaulting under Paragraph 4(4). This gives the qualifying owner the final authority as to who exercises the day-to-day control of the business. It is clear from the testimony of TPI's Vice-President of Franchise Sales and Development that TPI does not consider those provisions of the Agreement that appear to place restrictions on the qualifying owner's discretion as to the day- to-day control of the business as being mandatory, notwithstanding the language of the provisions to the contrary. Likewise, it is clear that TPI will not involve itself in the hiring, supervision or firing of employees because of the liability it would place upon TPI, notwithstanding any provision in the Agreement. The parties to the Agreement are experienced business people, who have expertise in the travel agency industry and franchising. The parties to the Agreement have clear and mutual understandings and interpretation of the meanings of the terms of the Agreement . Their understandings and interpretations are that the Agreement does not restrict the qualifying owner's exercise of the day-to-day control of the business. The parties' interpretation of the Agreement is a possible and permissible interpretation. TPI has some 60 franchisees within 22 states, with 17 franchisees in the State of Florida. There are several other franchisors that franchise travel agencies throughout the United States, including the State of Florida. The purpose of franchise agreements in the travel business in general, and this Agreement in particular, is to enable the small, independent travel agency to compete more effectively in the travel market. The growing trend in the travel agency industry is to belong to a franchise. The Agreement is a typical franchise agreement and customary in the travel industry.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is recommended that the Department enter a Final Order granting Petitioner's application for certification as a Disabled Business Enterprise. RECOMMENDED this day 9th of January, 1995, at Tallahassee, Florida. WILLIAM R. CAVE Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 9th day of January, 1995. APPENDIX TO RECOMMENDED ORDER, CASE NO. 94-0568 The following constitutes my specific rulings, pursuant to Section 120.59(2), Florida Statutes, on all of the proposed findings of fact submitted by the parties in this case. Petitioner's Proposed Findings of Fact. Petitioner has listed the stipulated facts separately as paragraphs 1 through 14. These stipulated facts have been adopted in Findings of Fact 1 through 14, respectively. Proposed findings of fact 1, 2, 3 and 4-5 adopted in substance as modified in Findings of Fact 23, 24, 26 and 21, consecutively. Proposed findings of fact 6 through 9 are neither material nor relevant to this proceeding. Proposed finding of fact 10 is adopted in substance as modified in Findings of Fact 20 through 22. Department's Proposed Findings of Fact. The Department has listed the stipulated facts separately as paragraphs 1 through 14. These stipulated facts have been adopted in Findings of Fact 1 through 14, respectively. Proposed findings of fact 1 and 2 are adopted in substance as modified in Finding of Fact 19. Proposed finding of fact 3 is adopted in substance as modified in Findings of Fact 20 through 22. Proposed findings of fact 4, 5 and 6 are adopted in substance as modified in Findings of Fact 15, 16 and 17, respectively. Proposed finding of 7 is rejected as being neither material nor relevant to this proceeding. Proposed findings of fact 8 and 9 are adopted in substance as modified in Findings of Fact 18. Proposed findings of fact 10, 11 and 12 are considered conclusions of law or legal argument and for that reason are rejected as Findings of Fact. Proposed findings of fact 13 and 14 are rejected as not being supported by the record. COPIES FURNISHED: Oscar Blasingame, Esquire Blasingame, Forisz, Smiljanich, P.A. Post Office Box 1259 St. Petersburg, Florida 33731 Dorothy S,. Johnson, Esquire Mary J. Dorman, Esquire Department of Transportation 605 Suwannee Street, MS-58 Tallahassee Florida 32399-0458 Ben G. Watts, Secretary ATTN: Eleanor F. Hunter Department of Transportation 605 Suwannee Street, MS-58 Tallahassee, Florida 32399-0458 Thornton J. Williams General Counsel Department of Transportation 562 Haydon Burns Building 605 Suwannee Street Tallahassee, Florida 32399-0450
The Issue Whether the application to organize Plus International Bank should be approved.
Findings Of Fact On March 24, 2000, the Department received an application (Application) from foreign nationals (Applicants) to organize a new bank, Plus International Bank (New Bank), to be located in Miami-Dade County, Florida. The Department published notice of its receipt of the Application in the April 7, 2000, edition of the Florida Administrative Weekly. The notice complied with the requirements Section 120.80(3)(a)1.a., Florida Statutes, and Rule 3C-105.103(1), Florida Administrative Code.5 By letter dated April 11, 2000, the Department requested the Applicants to supplement their Application with additional information, including information concerning their "promise of successful operation" and the New Bank's "capital structure," its "directors and officers," and its "banking quarters." It was not until November 3, 2000, that the Department received all of the additional information it had requested from the Applicants. The Application identifies four individuals associated with the New Bank who are foreign nationals: Manuel Sacal, Harry Sacal, Alex Sacal, and Roberto Barroso. Manuel Sacal (M. Sacal) is a proposed director of the New Bank and holder of 28% of the bank's outstanding shares of common stock. He is currently the Chief Executive Officer and General Director of Casa De Cambio Plus, S.A. de C.V. (Cambio Plus), a foreign exchange house based in Mexico City, Mexico, and the Chief Executive Officer and General Director of Plusder, S.A. de C.V., a futures brokerage house located in Mexico City, Mexico. As the Chief Executive Officer and General Director of Cambio Plus, a position he has held since 1987, M. Sacal has helped Cambio Plus become one of the largest exchange houses in Mexico. Harry Sacal (H. Sacal), like M. Sacal, is a proposed holder of 28% of the New Bank's outstanding shares of common stock. Alex Sacal (A. Sacal) is a proposed holder of 14% of the New Bank's outstanding shares of common stock. M. Sacal, H. Sacal, and A. Sacal are brothers. They each are citizens of Mexico. Roberto Barroso is a proposed director of the New Bank and holder of 0.1% of the New Bank's outstanding shares of common stock. He is a citizen of Brazil. Mr. Barroso has 30 years of banking experience, primarily in the area of international banking. He has, among other things, managed financial institutions and been involved in making trade financing arrangements. From approximately 1998, until his retirement in June of 2000, he was a Vice-President of Citibank. The other proposed directors of the New Bank identified in the Application -- Enrique Cabanilla, Barry Deutsch, Jaime Medina, Ira Weindruch, Deborah Jacobson, and Patrick Fournie -- are all United States citizens. These individuals, along with Mr. Barroso, have sufficient business experience, ability, standing, and reputation to enable them to perform their duties as the New Bank's directors in a manner that can reasonably be expected to result in the successful operation of the bank. Mr. Cabanilla, who is also identified as the proposed chief executive officer of the New Bank, has had over 30 years of banking experience, with particular emphasis in the areas of international banking and trade finance. He has held banking positions which have required him to be directly involved in credit analysis and approval, bank and personnel administration, direction and control of operations, and the application of routine control and audit functions. In addition, he has been responsible for the management of multi- branch banking operations and all phases of commercial lending. Although Mr. Cabanilla has not had at least one year of direct experience as an executive officer, director, or regulator of a financial institution within the last three years, it appears that he possesses sufficient financial institution experience, ability, standing, and reputation to enable him to perform his duties as the New Bank's chief executive officer in a manner that can reasonably be expected to result in the successful operation of the bank. Mr. Deutsch has had over 30 years of banking/bank consulting experience. He has been an employee of, and consultant to, a number of large United States financial institutions, such as Mellon National Bank, Bank One, and Bank of America. In addition, as a consultant, he has assisted a number of community banks in the South Florida area with strategic planning, marketing, and investor relations. He has also served as a consultant to several Latin American financial institutions, including Banco Popular de Puerto Rico and Grupo Financiero BAC, and to Bank Polska Kasa Opieki in Warsaw, Poland. While Mr. Deutsch has had at least one year of direct experience as an executive officer or director of a financial institution, he last served in such a capacity in 1988. Mr. Medina has had almost 20 years of banking experience, primarily in the area of international banking, and has had a least one year of direct experience as an executive officer of a financial institution within three years of the date the Application was filed with the Department. Mr. Weindruch was an owner and director of RockIsland Bank, an Illinois-state chartered bank, from 1985 until 1991. In addition, he served on the bank's loan, facilities, and personnel committees. He has not served as an executive officer or director of a financial institution since his departure from RockIsland Bank. Ms. Jacobson has extensive experience in the exporting and importing business. She has never been an executive officer or director of a financial institution. Mr. Fournie is the Chief Financial Officer for Surfin, Ltd., the Latin American arm of Direct TV. Prior to assuming his current position, he was employed by Citibank, where he gained considerable experience in international banking. Mr. Fournie has never been an executive officer or director of a financial institution. None of the proposed officers, directors, or major shareholders6 of the New Bank has been convicted of, or pled guilty or nolo contendere to, any violation of Section 655.50, Florida Statutes (which is known as the "Florida Control of Money Laundering in Financial Institutions Act"), any offense described Chapter 896, Florida Statutes, or any other crime. At present, the New Bank does not have a proposed president. The New Bank's business plan reflects that the bank will offer trade financing and commercial loans to small and medium-sized United States exporters and importers located primarily in Florida; commercial loans and small business loans to small and medium-sized businesses in the Miami-Dade County community; and private banking services to high net worth individuals, particularly those who are foreign nationals and permanent or part-time residents of the United States. The Application indicates that, at the time of the opening of the New Bank, 5,000,000 shares of common stock will have been sold at $2.00 per share, producing $10,000,000.00 in start-up capital. (According to the Application, the total number of shares of common stock that the New Bank will be authorized to issue is 7,500,000.) Of the $10,000,000.00 in start-up capital that the New Bank will have at opening, $7,000,000.00 will have been contributed by the Sacal brothers (M. Sacal, H. Sacal, and A. Sacal). Approximately $2,500,000.00 of the remaining $3,000,000.00 in start-up capital has already been raised. The Sacal brothers have committed to increasing their investment in the New Bank after its opening, as circumstances warrant. The Application estimates that net organizational expenses will be $446,642.00. Of the amount ($9,553,358.00) of capital remaining following payment of these expenses, $5,000,000 will be allocated as paid-in capital (5,000,000 shares at $1.00 par value). The New Bank's proposed capital structure will also have paid-in surplus in an amount greater than 20 percent of paid-in capital and a fund designated as undivided profits in an amount greater than five percent of paid-in capital. The initial capitalization of the New Bank appears to be adequate in relation to its proposed business activities. Local conditions in Miami-Dade County indicate reasonable promise of successful operation of the New Bank. The bank's financial plan appears to be reasonable and attainable. The parties have stipulated that the corporate name, "Plus International," is not, and cannot, be reserved with the Department of State inasmuch as the Department of State no longer reserves corporate names. The New Bank, which will be located at 200 South Biscayne Boulevard, Miami, Florida, will have suitable quarters. The Applicants have applied to have the New Bank insured by the Bank Insurance Fund (BIF) of the Federal Deposit Insurance Corporation (FDIC). The application was received by the FDIC on July 11, 2000. DONE AND ENTERED this 9th day of February, 2001, in Tallahassee, Leon County, Florida. ___________________________________ STUART M. LERNER Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 9th day of February, 2001.
