Bassett Press EDGAR Services

-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, KfdlVOSWtCgDULUc54eLDG6UwcwsB4RqdK6rbxkkFZJjtqd8d2301u8hrJ0rRL1b KvJ63UtOJRHQj1Obe8Jmow== 0001116502-03-000210.txt : 20030218 0001116502-03-000210.hdr.sgml : 20030217 20030218172527 ACCESSION NUMBER: 0001116502-03-000210 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 1 FILED AS OF DATE: 20030218 SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: RAE SYSTEMS INC CENTRAL INDEX KEY: 0001084876 STANDARD INDUSTRIAL CLASSIFICATION: MEASURING & CONTROLLING DEVICES, NEC [3829] IRS NUMBER: 770588488 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-58813 FILM NUMBER: 03571530 BUSINESS ADDRESS: STREET 1: 1339 MOFFETT PARK DRIVE CITY: SUNNYVALE STATE: CA ZIP: 95112 BUSINESS PHONE: 408-752-0723 FORMER COMPANY: FORMER CONFORMED NAME: NETTAXI INC DATE OF NAME CHANGE: 19990422 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: GARDNER MICHAEL CENTRAL INDEX KEY: 0001133352 FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: C/O BAYTREE CAPITAL ASSOCIATES INC STREET 2: 40 WALL ST SUITE 58 CITY: NEW YORK STATE: NY ZIP: 10005 BUSINESS PHONE: 2125041700 MAIL ADDRESS: STREET 1: C/O BAYTREE CAPITAL ASSOCIATES INC STREET 2: 40 WALL ST SUITE 58 CITY: NEW YORK STATE: NY ZIP: 10005 SC 13D/A 1 schedule13da2raeclean.htm AMENDMENT NO. 2 TO SCHEDULE 13D Bassett Press EDGAR Services

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 13D

Under the Securities and Exchange Act of 1934

(Amendment No. 2)*

RAE SYSTEMS, INC.

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(Name of Issuer)

Common Stock, $0.01 Par Value Per Share

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(Title of Class of Securities)

75061P102

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(CUSIP Number)

Michael Gardner, c/o Baytree Capital Associates, LLC, 40 Wall Street,

Suite 58, New York, NY 10005 (212) 509-1700

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(Name, Address and Telephone Number of Person

Authorized to Receive Notices and Communications)

January 27, 2003

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(Date of Event which Requires Filing of This Statement)

If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of §§ 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box [_].

NOTE: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See Rule 13d-7 for other parties to whom copies are to be sent.

* The remainder of this cover page shall be filled out for a reporting person's initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page.

The information required on the remainder of this cover page shall not be deemed to be "filed" for the purpose of Section 18 of the Securities Exchange Act of 1934 (“Act”) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).

CUSIP No.75061P102

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Page 2 of 6 pages

_____________________________________________________________________________________

Names of Reporting Persons.

I.R.S. Identification Nos. of Above Persons (entities only)

Michael Gardner

_____________________________________________________________________________________

Check the Appropriate Box if a Member of a Group (See Instructions)

(a) [ ]

(b) [X]

_____________________________________________________________________________________

SEC Use Only (See Instructions)

_____________________________________________________________________________________

Source of Funds (See Instructions)

_____________________________________________________________________________________

Check if Disclosure of Legal Proceedings is Required Pursuant to Items 2(d) or 2(e) [_]

Not Applicable.

_____________________________________________________________________________________

Citizenship or Place of Organization

United States

_____________________________________________________________________________________

Sole Voting Power

2,836,596 shares beneficially owned in the aggregate

Number of

__________________________________________________________

Shares Beneficially

Shared Voting Power

Owned by Each

Not Applicable

Reporting Person

__________________________________________________________

With

Sole Dispositive Power

2,836,596 shares beneficially owned in the aggregate

__________________________________________________________

10)

Shared Dispositive Power

_____________________________________________________________________________________

11)

Aggregate Amount Beneficially Owned by each Reporting Person

2,836,596 shares

_____________________________________________________________________________________

12)

Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions)

[X]

_____________________________________________________________________________________

13)

Percent of Class Represented by Amount in Row (11)

6.26%

_____________________________________________________________________________________

14)

Type of Reporting Person (See Instructions)

CUSIP No.75061P102

13D

Page 3 of 6 pages

_____________________________________________________________________________________

Item 1. Security and Issuer.

This statement on Schedule 13D (the “Statement”) relates to the common stock, $0.01 par value per share of RAE Systems, Inc. (“RAE”), a Delaware corporation, with its principal executive offices at 1339 Moffett Park Drive, Sunnyvale, CA 94089.

_____________________________________________________________________________________

Item 2. Identity and Background.

(a)

Michael Gardner

(b)

Business address: 40 Wall Street, Suite 58, New York, NY 10005, c/o Baytree Capital Associates, LLC

(c)

Occupation: Investor, Principal business of employer: invest in other businesses, Baytree Capital Associates, LLC, 40 Wall Street, 58th Floor, New York, NY 10005

(d)

(e)

No.

(f)

United States

_____________________________________________________________________________________

Item 3. Source and Amount of Funds or Other Consideration.

Mr. Gardner used his personal funds amounting to $24,750 to purchase 60,000 additional shares since the filing of Schedule 13D/A No. 1.

Item 4. Purpose of Transaction.

All RAE securities owned by Mr. Gardner have been acquired by Mr. Gardner for investment purposes only.

(a)

None

(b)

None

(c)

None

(d)

None

(e)

None

(f)

None

(g)

None

(h)

None

(i)

None

(j)

None

_____________________________________________________________________________________

Item 5. Interest in Securities of the Issuer.

Previous Position

(1)

As of April 9, 2002, Mr. Gardner owed 1,221,781 shares of RAE common stock as a result of the merger of Net taxi.com, Inc. and RAE. In addition, Mr. Gardner owned warrants to purchase a total of 2,002,082 shares of RAE common stock at the following exercise prices per share: 1,750,000 at $1.21, 61,729 at $1.985 per share and 190,353 at $22.68.

(2)

Over the course of the period April 10, 2002 through the event date, Mr. Gardner purchased an aggregate of 227,830 shares of common stock of RAE Systems, Inc. in 19 purchase transactions in the over-the-counter market for an average price per share of $0.7233 or $164,784.50 in the aggregate.

CUSIP No.75061P102

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Page 4 of 6 pages

(3)

On December 13, 2002, Mr. Gardner acquired 114,903 additional shares of RAE common stock for $0.41875 per share, or an aggregate amount of $48,115.63, in a private transaction.

(4)

In August 2002, Mr. Gardner gave warrants to purchase 790,000 shares of RAE common stock exercisable at $1.21 per share to employees, attorneys and other persons associated with Baytree Capital Associates, LLC, a limited liability company (“Baytree”) owned by Mr. Gardner. These warrants were previously issued to Mr. Gardner in connection with services rendered by Mr. Gardner pursuant to a consulting agreement by and between Mr. Gardner and Nettaxi.com, Inc.

Disclaimed Interests

On December 13, 2002, Lynda Gardner, Mr. Gardner’s wife, acquired 25,000 shares of RAE common stock for $0.41875 per share or an aggregate of $10,468.75. These shares are held solely by Mrs. Gardner who used her personal funds to purchase them. In August 2002, Mrs. Gardner received warrants to purchase 100,000 shares of common stock of RAE common stock exercisable at $1.21 as part of the warrants Mr. Gardner described in (4) above. Mr. Gardner specifically disclaims any beneficial ownership interest in the shares of common stock of RAE purchased by Mrs. Gardner or the warrants she received in connection with her employment at Baytree.

As of Event Date

Common Stock

As of the event date, Mr. Gardner’s ownership of RAE securities has been modified by the following actions:

On January 27, 2003, Mr. Gardner purchased an aggregate of 60,000 shares of common stock of RAE in two purchase transactions in the over-the-counter market for an average price per share of $0.4125 or $24,750 in the aggregate.

_____________________________________________________________________________________

(a)

2,836,596 of common stock 6.26% of outstanding shares.

(b)

2,836,596. This does not include Mrs. Gardner’s 25,000 shares of common stock or the warrants owned by Mrs. Gardner described under the Disclaimed Interests section above. Mr. Gardner has no power, shares or otherwise to vote, direct the vote, dispose of or direct the disposition of these shares and specifically disclaims any beneficial interest in them.

(c)

The transactions are listed above.

(d)

None

(e)

N/A

CUSIP No.75061P102

13D

Page 5 of 6 pages

_____________________________________________________________________________________

Item 6. Contracts, Arrangements, Understandings or Relationships with Respect to Securities of the Issuer.

On August 1, 2002, Mr. Gardner amended a management consulting agreement he entered into with Nettaxi.com, Inc. on October 30, 2000. Mr. Gardner agreed to render consulting advice to Nettaxi.com, Inc. with respect to financial, corporate and general business development matters (the “Consulting Agreement”). In consideration for on-going services to be rendered by Mr. Gardner pursuant to the amended Consulting Agreement, RAE issued to Mr. Gardner a warrant to purchase 1,750,000 shares of RAE common stock at an exercise price of $1.21 per share.

_____________________________________________________________________________________

Item 7. Material to be Filed as Exhibits.

None.

CUSIP No.75061P102

13D

Page 5 of 6 pages

SIGNATURE

After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.

Date: February 18, 2003

/s/ Michael Gardner

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Michael Gardner

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Name/Title

Attention. Intentional misstatements or omissions of fact constitute federal

criminal violations (see 18 U.S.C. 1001).

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