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SECURITIES AND EXCHANGE COMMISSION
450 Fifth Street, N.W.
Washington, D. C. 20549
__________________________________
FORM 10
General Form for Registration of Securities
File No. _________________________
Pursuant to Section 12(b) or (g) of
The Securities Exchange Act of 1934
QUINTESSENCE OIL COMPANY
(Exact name of registrant as specific in its charter)
Wyoming 83-0317306
(State of Incorporation) (I.R.S. Employer I.D. No.)
4424 Skylane Avenue
Riverton, Wyoming 92501
(Address of principal executive offices, including zip code)
Telephone number, including area code: (307) 856-0375
Copies to: Conrad C. Lysiak, Esq.
West 601 First Avenue, Suite 503
Spokane, Washington 99204
Securities to be registered pursuant to Section 12(b) of the Act:
NONE
(Title of Class)
Securities to be registered pursuant to Section 12(g) of the Act:
COMMON STOCK
(Title of Class)
Exhibit Index begins on page ___
Page 1 of ___.
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ITEM 1. BUSINESS.
The Business
Quintessence Oil Company (the "Company") is a development stage
enterprise formed under the laws of the State of Wyoming on June 26, 1996,
for the purpose of purchasing, developing and operating oil and gas leases.
The Company has acquired one undeveloped oil and gas lease and intends
to acquire additional leases prior to deciding where to initiate drilling
operations.
Selection of Target Areas for Acquisition
The Company's proposed plans call for it to consider several factors in
choosing a region for acquisition of oil and gas leases. First, the Company
considers those regions in which one or more of its management or other
technical personal have field of experience. The Company anticipates that
additional prospects to be acquired will be located within Wyoming. At the
present time the Company has not targeted any additional oil and gas leases
for acquisition. The Company intends to acquire additional oil and gas
leases from other oil and gas companies.
The Company will determine which leases it is interested in acquiring
based upon the analysis of technical and production data, on site
verification of any well equipment and production capability, and
verification of ownership of lease hold rights. The Company anticipates that
it will take from four to six months to acquire additional leasehold
interests. Further, the Company intends upon diversifying its production
portfolio with respect to both reservoir production characteristics and to
market access. The Company believes that the overall effect of these two
unrelated characteristics is to significantly lower the overall risk of the
Company strategy.
Geological and Geophysical Techniques
The Company may employ detailed geological interpretation combined with
advanced seismic exploration techniques to identify the most promising
leases. Geological interpretation is based upon data recovered from existing
oil and gas wells in an area and other sources. Such information is either
purchased from the company that drilled the wells or becomes public knowledge
through state agencies after a period of years. Through analysis of rock
types, fossils and the electrical and chemical characteristics of rocks from
existing wells, the Company can construct a picture of rock layers in the
area. Further, the Company will have access to the logs from the existing
operating wells which will allow the Company to extrapolate a decline curve
and make an estimation of the number of recoverable barrels of oil existing
beneath a particular lease. The Company has not purchased, leased, or
entered into any agreements to purchase or lease any of the equipment
necessary to conduct the geological or geophysical testing referred to herein
and will only be able to do so upon raising additional capital through loans
or the sale of equity securities.
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Market for Oil and Gas Production
The market for oil and gas production is regulated by both the state and
federal governments. The overall market is mature and with the exception of
gas, all producers in a producing region will receive the same price. The
major oil companies will purchase all crude oil offered for sale at posted
field prices. There are price adjustments for quality difference from the
Bench Mark. Oil sales are normally contracted with a gatherer who will pick-
up the oil at the well site. In some instances there may be deductions for
transportation from the well head to the sales point. At this time the
majority of crude oil purchasers do not charge transportation fees, unless
the well is outside their service area. The oil gatherer will usually handle
all check disbursements to both the working interest and royalty owners. The
Company will be a working interest owner. By being a working interest owner,
the Company is responsible for the payment of its proportionate share of the
operating expenses of the well. Royalty owners and over-riding royalty
owners receive a percentage of gross oil production for the particular lease
and are not obligated in any manner whatsoever to pay for the costs of
operating the lease. Therefore, the Company, in most instances, will be
paying the expenses for the oil and gas revenues paid to the royalty and
over-riding royalty interests.
Gas sales are by contract. The gas purchaser will pay the well operator
100% of the sales proceeds on or about the 25th of each and every month for
the previous months sales. The operator is responsible for all checks and
distributions to the working interest and royalty owners. There is no
standard price for gas. Prices will fluctuate with the seasons and the
general market conditions. It is the Company's intention to utilize this
market when ever possible in order to maximize revenues. The Company does
not anticipate any significant change in the manner production is purchased,
however, no assurance can be given at this time that such changes will not
occur.
Acquisition of Future Leases
The principal activity for the Company in the future will be the
acquisition of producing oil and gas leases. The acquisition process may be
lengthy because of the amount of investigation which will be required prior
to submitting a bid to a major oil company. Verification of each property
and the overall acquisition process can be divided into three phases, as
follows:
Phase 1. Field identification. In some instances the seller will have
a formal divestiture department that will provide a sales catalog of leases
which will be available for sale. Review of the technical filings made to
the states along with a review of the regional geological relationships,
released well data and the production history for each lease will be
utilized. In addition a review of the proprietary technical data in the
sellers office will be made and calculation of a bid price for the field.
Phase 2. Submission of the Bid. Each bid will be made subject to
further verification of production capacity, equipment condition and status,
and title.
Phase 3. Closing. Final price negotiation will take place. Cash
transfer and issuance of title opinions. Tank gauging and execution of
transfer orders.
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After closing has occurred, the newly acquired property will be turned
over to the Company for possible work-overs or operational changes which will
in the Company's estimation increase each well's production.
In connection with the acquisition of an oil and gas lease for work-over
operations, the Company is able to assume 100% ownership of the working-
interest and surface production equipment facilities with only minor
expenses. In exchange for an assignment of the lease, the Company agrees to
assume the obligation to plug and abandon the well in the event the Company
determines that reworking operations are either to expensive or will not
result in production in paying quantities. The cost of plugging a well can
run from $500 to $15,000, depending on the condition of the well. The
Company believes that the obligation to plug an existing well will in no way
jeopardize its operations, and in the long run is economically worth the risk
involved compared with the possibility of acquiring existing production.
Utilizing these systems the Company will be able to acquire oil and gas
leases from large and small oil and gas firms with little costs. The Company
also believes that it may be able to plug the wells in question, at no cost
to the Company, in exchange for the production tubing and casing which will
be removed during the plugging process.
Several major oil companies have recently placed numerous oil and gas
properties out for competitive bidding. The Company currently does not have
sufficient revenues or funds available to it to make a bid for such
properties. The Company intends to raise additional capital through loans or
the sale of equity securities in order to have sufficient funds to make a bid
for such properties. There is no assurance that the Company will very raise
such additional capital and if the Company is unable to raise such capital,
it may have to cease operations. At the present time, the Company has not
identified any specific oil and gas leases which it intends to acquire and
will only be able to make such determination upon raising said capital.
Net Production
As of the date hereof, the Company has acquired a 100% working interest,
in one non-producing oil and gas lease. See "Item 2. Description of
Properties."
Competition
The oil and gas industry is highly competitive. The Company's
competitors and potential competitors include major oil companies and
independent producers of varying sizes of which are engaged in the
acquisition of producing properties and the exploration and development of
prospects. Most of the Company's competitors have greater financial,
personnel and other resources than does the Company and therefore have a
greater leverage to use in acquiring prospects, hiring personnel and
marketing oil and gas. Accordingly, a high degree of competition in these
areas is expected to continue.
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Governmental Regulation
The production and sale of oil and gas is subject to regulation by
state, federal and local authorities. In most areas there are statutory
provisions regulating the production of oil and natural gas under which
administrative agencies may set allowable rates of production and promulgate
rules in connection with the operation and production of such wells,
ascertain and determine the reasonable market demand of oil and gas, and
adjust allowable rates with respect thereto.
The sale of liquid hydrocarbons was subject to federal regulation under
the Energy Policy and Conservation Act of 1975 which amended various acts,
including the Emergency Petroleum Allocation Act of 1973. These regulations
and controls included mandatory restrictions upon the prices at which most
domestic crude oil and various petroleum products could be sold. All price
controls and restrictions on the sale of crude oil at the wellhead have been
withdrawn. It is possible, however, that such controls may be reimposed in
the future but when, if ever, such reimposition might occur and the effect
thereof on the Company cannot be predicted.
The sale of certain categories of natural gas in interstate commerce is
subject to regulation under the Natural Gas Act and the Natural Gas Policy
Act of 1978 ("NGPA"). Under the NGPA, a comprehensive set of statutory
ceiling prices applies to all first sales of natural gas unless the gas is
specifically exempt from regulation (i.e., unless the gas is "deregulated").
Administration and enforcement of the NGPA ceiling prices are delegated to
the FERC. In June 1986, the FERC issued Order No. 451, which, in general, is
designed to provide a higher NGPA ceiling price for certain vintages of old
gas. It is possible, though unlikely, that the Company may in the future
acquire significant amounts of natural gas subject to NGPA price regulations
and/or FERC Order No. 451.
Company's Office
The Company's offices are located at 4424 Skylane Avenue, Riverton,
Wyoming 82501. The Company leases the space from Nucor, Inc., as well as,
equipment including computers, office computer programs, fax machines, small
copy machines, a scanner, telephones, desks, files and fixtures. The lease
payment is at the rate of $400.00 per month, plus out-of-pocket expenses, on
a month-to-month basis. Nucor, Inc. is a corporation owned and operated by
Nick Bebout, the Company's President. The transaction with Nucor is no less
favorable to the Company than can be obtained from independent third parties.
Employees
The Company is a development stage company and currently has no
employees other than its Officers and Directors.
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ITEM 2. FINANCIAL INFORMATION.
SELECTED CONSOLIDATED FINANCIAL DATA
The selected financial data presented below has been derived from the
financial statements of the Company, which financial statements have been
examined by Hocker, Lovelett, Hargens & Yennie, P.C., C.P.A., independent
certified public accountants, as indicated in their report included elsewhere
herein.
The following table summarized certain financial information and should
be read in conjunction with "Management's Discussion and Analysis of
Financial Condition and Results of Operations" and the Financial Statements
and related notes included elsewhere in this Prospectus. For the reasons set
forth in this Form 10 registration statement the information shown below may
not be indicative of the Company's future results of operations.
Statement of Loss and Accumulate Deficit Data from inception (June 26, 1996)
through September 30, 1996:
<TABLE>
<S> <C>
Income $ -0-
Operating Expenses $ 1,698
Net Loss $ (1,698)
Net Loss per Share $ 0.0017
Balance Sheet Data:
Working Capital $ 42,302
Total Assets $ 49,802
Short-term Debt $ 9,000
Stockholders' equity $ 40,802
</TABLE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND FINANCIAL
CONDITIONS
Results of Operations
The Company is considered to be in the development stage as defined in
Statement of Financial Accounting Standards No. 7. There have been limited
operations to date consisting of raising capital and the acquisition of one
oil and gas lease.
Liquidity and Capital Resources
The Company sold 1,000,000 shares of its Common Stock pursuant to Reg.
504 of the Securities Act of 1933 (the "Act") to officers, directors and
others, and raised $50,000. The foregoing funds were used for organizational
matters and to acquire one oil and gas lease. The Company has $42,302 in
cash as of November 25, 1996.
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ITEM 3. DESCRIPTION OF PROPERTIES.
The Company owns one undeveloped oil and gas lease, more particularly
described as the S 1/2, SW 1/4, SW 1/4 of Section 24 and the N 1/2, NE 1/4
and the NE 1/4, NW 1/4 of Section 33 all located in Township 37 North, Range
91 West, 6th Prime Meridian containing 140 acres more or less. The foregoing
lease has never produced oil or gas.
ITEM 4. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.
The following table sets forth as of November 25, 1996, the Common Stock
ownership of each person known by the Company to be the beneficial owner of
five percent or more of the Company's Common Stock, each director
individually and all officers and directors of the Company as a group. Each
person has sole voting and investment power with respect to the shares of
Common Stock shown, and all ownership is of record and beneficial.
<TABLE>
<CAPTION>
Name and address Number of Percent
of owner Shares Position of Class
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<S> <C> <C> <C>
Nick Bebout 218,750 President, Treasurer 21.88%
1606 Major Avenue and a member of the
Riverton, Wyoming 82501 Board of Directors
Tom Kerr 0 Vice President and a 0.00%
P. O. Box 3973 member of the Board
Spokane, Washington 99220 of Directors
Tom Swanson 175,000 Secretary and a member 17.50%
P. O. Box 3215 of the Board of Directors
Casper, Wyoming 82601
All officers and 393,750 39.38%
directors as a
group (3 persons)
Eli Bebout 118,750 11.88%
112 Big Bend
Riverton, Wyoming 82501
Bebout Family
Trust [1] 37,500 3.75%
112 Big Bend
Riverton, Wyoming 82501
Bebout Land &
Livestock, Co. [2] 37,500 3.75%
112 Big Bend
Riverton, Wyoming 82501
John E. Orr and Linda
E. Erkkila 175,000 17.50%
200 Columbine Drive
Casper, Wyoming 82604
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Michael D. Zwickl 195,000 19.50%
137 North Beech
Casper, Wyoming 82601
</TABLE>
[1] Eli Bebout, the brother of Nick Bebout, is the Trustee of the Bebout
Family Trust.
[2] Eli Bebout, the brother of Nick Bebout, is the President of Bebout Land
& Livestock, Co.
ITEM 5. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS.
Officers and Directors.
The officers and directors of the Company are as follows:
Name Age Position
Nick Bebout 44 President, Treasurer and a member of
the Board of Directors
Tom Kerr 64 Vice President and a member of the
Board of Directors
Tom Swanson 44 Secretary and a member of the Board
of Directors
All directors hold office until the next annual meeting of shareholders
or until their successors have been elected and qualified. The Company's
officers are elected by the Board of Directors at the annual meeting after
each annual meeting of the Company's shareholders and hold office until their
death, or until they resign or have been removed from office.
Nick Bebout - President, Treasurer and a member of the Board of Directors
Mr. Bebout is a founder, President, Treasurer and a Directors of the
Company. Since 1988, Mr. Bebout has been a member of the Board of Directors
of U.S. Energy, Inc., a NASDAQ traded public company engaged in the oil and
gas industry. From January 1988 to August 1995, Mr. Bebout was President,
Treasurer and a member of the Board of Directors of S.W. Financial Corp., a
Washington blank check corporation. Since June 1984, Mr. Bebout has been
President of Nucor, Inc., an oil, gas and mineral exploration and development
corporation. From January 1979 to December 1983, Mr. Bebout was Vice
President of Corkill Drilling, a corporation which specialized in oil, gas
and mineral exploration.
Thomas K. Kerr - Vice President and a member of the Board of Directors
Mr. Kerr is a founder, Vice President and a member of the Board of
Directors of the Company. From January 1988 to August 1995, Mr. Kerr was
Vice President, Secretary and a member of the Board of Directors of S.W.
Financial Corp., a Washington blank check corporation. From August 1958 to
January 1988, Mr. Kerr was a sales representative with Massachusetts Mutual
Life Insurance Company, Mr. Kerr was also a District Manager, From January
1988 to June 1988, Mr. Kerr was employed with Independent Insurance Agents &
Brokers of Spokane and Walla Walla. Since June 1988, Mr. Kerr has been a
sales representative with Guardian Life Insurance Company of America.
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Tom Swanson - Secretary and a member of the Board of Directors
Mr. Swanson is a founder, Secretary and a member of the Board of
Directors of the Company. From July 1985 to the present, Mr. Swanson has
been exploration manager for Farleigh Oil Properties, an independent oil
company based in Casper, Wyoming. Farleigh Oil Properties is a privately
held company involved in oil field acquisition and exploration in seven Rocky
Mountain states and Texas. From November 1991 to the present, Mr. Swanson
has been the business manager for Paradigm Technologies, LLC, located in
Casper, Wyoming. Paradigm Technologies is a research and development company
that develops downhole sensory instrumentation for oil well drilling
applications. From December 1990 to July 1995, Mr. Swanson was Vice
President of Scientific Geochemical Services, LLC, an oil field service
company specializing in exploration and environmental geochemistry.
Scientific Geochemical Service was located in Casper, Wyoming until it was
sold in mid-1995.
Executive Remuneration
The Company anticipates entering into employment agreements with its
officers in the future, the terms of which are undecided at the present time.
Directors do not receive compensation for their services as directors and are
not reimbursed for expenses incurred in attending board meetings. The
Company has not paid any salaries in 1996 and will not initiate the payment
of salaries until it becomes profitable to do so.
ITEM 6. EXECUTIVE COMPENSATION.
The Company anticipates entering into employment agreements with its
officers in the near future, the terms of which are undecided at the present
time. Directors do not receive compensation for their services as directors
and are not reimbursed for expenses incurred in attending board meetings.
The Company has not paid any salaries in 1996 and will not initiate the
payment of salaries until it becomes profitable to do so.
ITEM 7. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
On July 2, 1996, the Company issued 900,000 shares of Common Stock to
the following individuals and corporations in consideration of the payment of
$0.02 per share in cash.
Name Total Consideration Shares Acquired
Eli Bebout $ 2,000.00 100,000
112 Big Bend
Riverton, Wyoming 82501
Bebout Family Trust $ 750.00 37,500
112 Big Bend
Riverton, Wyoming 82501
Bebout Land & Livestock Co. $ 750.00 37,500
112 Big Bend
Riverton, Wyoming 82501
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John E. Orr and
Linda E. Erkkila $ 3,500.00 175,000
200 Columbine Drive
Casper, Wyoming 82604
Tom Swanson $ 3,500.00 175,000
P. O. Box 3215
Casper, Wyoming 82601
Michael D. Zwickl $ 3,500.00 175,000
137 North Beech
Casper, Wyoming 82601
Nick Bebout $ 4,000.00 200,000
1606 Major Avenue
Riverton, Wyoming 82501
TOTAL $ 18,000.00 900,000
On October 9, 1996, the Company issued 100,000 shares of Common Stock to
the following individuals and corporations in consideration of the payment of
$0.32 per share in cash.
Name Total Consideration Shares Acquired
Eli Bebout $ 6,000.00 18,750
112 Big Bend
Riverton, Wyoming 82501
Nick Bebout $ 6,000.00 18,750
1606 Major Avenue
Riverton, Wyoming 82501
Bill Farleigh $ 6,400.00 20,000
P. O. Box 3215
Casper, Wyoming 82602
Ken Freemole $ 6,400.00 20,000
4831 Dexter
Casper, Wyoming 82609
Hayden Investments $ 800.00 2,500
675 Fairview Drive
Suite 246
Carson City, Nevada 89701
Michael D. Zwickl $ 6,400.00 20,000
137 North Beech
Casper, Wyoming
TOTAL $ 32,000.00 100,000
On November 6, 1996, the Company acquired, by assignment, a 100% working
interest from Edward Calvert in and to an undeveloped oil and gas lease
between the United States of America and Edward D. Calvert covering the
following described real property:
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S 1/2, SW 1/4, SW 1/4 of Section 24 and the N 1/2, NE 1/4 and the
NE 1/4, NW 1/4 of Section 33 all located in Township 37 North,
Range 91 West, 6th Prime Meridian containing 140 acres more or
less.
The consideration for the assignment of the foregoing lease was $2,000 which
has been paid and a 5% overriding royalty. The foregoing lease has never
produced oil and/or gas and there is no assurance that the lease will ever
produce oil and/or gas or that the Company will ever explore for oil and/or
gas on the foregoing lease. Mr. Calvert is not affiliated with the Company
or any of its officers and directors.
ITEM 8. LEGAL PROCEEDINGS.
The Company is not a party to any litigation and to its knowledge, no
action, suit or proceedings against it has been threatened by any person.
ITEM 9. MARKET PRICE OF AND DIVIDENDS ON THE COMPANY'S COMMON EQUITY AND
RELATED STOCKHOLDER MATTERS.
No market exists for the Company's securities and there is no assurance
that a regular trading market will develop, or if developed, that it will be
sustained. A shareholder in all likelihood, therefore, will be unable to
resell the securities referred to herein should he or she desire to do so.
Furthermore, it is unlikely that a lending institution will accept the
Company's securities as pledged collateral for loans unless a regular trading
market develops.
There are no plans, proposals, arrangements or understandings with any
person with regard to the development of a trading market in any of the
Company's securities.
As of November 25, 1996, the Company has 11 holders of record of its
Common Stock.
The Company has not paid any dividends since it is inception and does
not anticipate paying any dividends on its Common Stock in the foreseeable
future.
ITEM 10. RECENT SALES OF UNREGISTERED SECURITIES.
On July 2, 1996, the Company issued 900,000 shares of Common Stock to
the following individuals and corporations in consideration of the payment of
$0.02 per share in cash.
Name Total Consideration Shares Acquired
Eli Bebout $ 2,000.00 100,000
112 Big Bend
Riverton, Wyoming 82501
Bebout Family Trust $ 750.00 37,500
112 Big Bend
Riverton, Wyoming 82501
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Bebout Land & Livestock Co. $ 750.00 37,500
112 Big Bend
Riverton, Wyoming 82501
John E. Orr and
Linda E. Erkkila $ 3,500.00 175,000
200 Columbine Drive
Casper, Wyoming 82604
Tom Swanson $ 3,500.00 175,000
P. O. Box 3215
Casper, Wyoming 82601
Michael D. Zwickl $ 3,500.00 175,000
137 North Beech
Casper, Wyoming 82601
Nick Bebout $ 4,000.00 200,000
1606 Major Avenue
Riverton, Wyoming 82501
TOTAL $ 18,000.00 900,000
On October 9, 1996, the Company issued 100,000 shares of Common Stock to
the following individuals and corporations in consideration of the payment of
$0.32 per share in cash.
Name Total Consideration Shares Acquired
Eli Bebout $ 6,000.00 18,750
112 Big Bend
Riverton, Wyoming 82501
Nick Bebout $ 6,000.00 18,750
1606 Major Avenue
Riverton, Wyoming 82501
Bill Farleigh $ 6,400.00 20,000
P. O. Box 3215
Casper, Wyoming 82602
Ken Freemole $ 6,400.00 20,000
4831 Dexter
Casper, Wyoming 82609
Hayden Investments $ 800.00 2,500
675 Fairview Drive
Suite 246
Carson City, Nevada 89701
Michael D. Zwickl $ 6,400.00 20,000
137 North Beech
Casper, Wyoming
TOTAL $ 32,000.00 100,000
All of the foregoing shares were sold pursuant to Reg. 504 of the
Securities Act of 1933.
<PAGE> 13
ITEM 11. DESCRIPTION OF THE COMPANY'S SECURITIES TO BE
REGISTERED.
The authorized capital stock of the Company consists of 50,000,000
shares of Common Stock, $0.00001 par value per share.
Common Stock
The authorized Common Stock of the Company consists of 50,000,000 shares
of $0.00001 par value Common Stock. As of November 25, 1996, 1,000,000
shares are issued and outstanding, all of re freely tradeable, but 957,500
are subject to the limitations of Reg. 144 promulgated under the Securities
Act of 1933 (the "Act"), with the exception of the two year holding period
contained therein.
In general, under Reg. 144, an affiliate of the Company (officers,
directors, and owners of more than ten percent (10%) of the outstanding
shares of Common Stock are affiliates of the Company) may sell in ordinary
market transactions through a broker or with a market maker, within any three
(3) month period a number of shares which does not exceed the greater of one
percent (1%) of the number of outstanding shares of Common Stock or the
average of the weekly trading volume of the Common Stock during the four
calendar weeks prior to such sale. Sales under Reg. 144 require the filing
of Form 144 with the Securities and Exchange Commission. If the shares of
Common Stock have been held for more than three (3) years by a person who is
not an affiliate, there is no limitation on the manner of sale or the volume
of shares that may be sold and no Form 144 is required. Sales under Reg. 144
may have a depressive effect on the market price of the Company's Common
Stock.
Further, a person may be considered a presumptive underwriter in that it
acquired more than 10% of the total shares distributed by the Company in its
two offerings pursuant to Reg. 504 of the Securities Act of 1933, as amended.
All shares have equal voting rights and are not assessable. Voting
rights are not cumulative and, therefore, the holders of more than 50% of the
Common Stock could, if they chose to do so, elect all of the directors of the
Company.
Upon liquidation, dissolution or winding up of the Company, the assets
of the Company, after the payment of liabilities, will be distributed pro
rata to the holders of the Common Stock. The holders of the Common Stock do
not have preemptive rights to subscribe for any securities of the Company and
have no right to require the Company to redeem or purchase their shares. The
shares of Common Stock presently outstanding are fully paid and non-assessable.
Dividends
Holders of the Common Stock are entitled to share equally in dividends
when, as and if declared by the Board of Directors of the Company, out of
funds legally available therefore. No dividend has been paid on the Common
Stock since inception, and none is contemplated in the foreseeable future.
<PAGE> 14
Transfer Agent
The Company's transfer agent for its shares of Common Stock is:
Transecurities International, Inc.
2510 North Pines Road
Suite 202
Spokane, Washington 99206
(509) 927-1255
Trading
There is currently no public market for the Company's Common Stock and
there is no assurance that a public market will ever develop.
Rights of Shareholders
Shareholders of the Company have no preemptive rights to acquire
additional shares of Common Stock or other securities. The Common Stock is
not subject to redemption and carries no subscription or conversion rights.
In the event of liquidation of the Company, the shares of Common Stock are
entitled to share equally in corporate assets after satisfaction of all
liabilities. The shares of Common Stock, when issued, will be fully paid and
non-assessable.
There are no outstanding options, warrants or rights to purchase shares
of the Company's Common Stock, other than as offered herein.
ITEM 12. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 42:01 et al. of the Wyoming Revised Statutes and certain
provisions of the Company's Articles of Incorporation under certain
circumstances provide for indemnification of the Company's Officers,
Directors and controlling persons against liabilities which they may incur in
such capacities. A summary of the circumstances in which such
indemnification is provided for is contained herein, but this description is
qualified in its entirety by reference to the Company's Articles of
Incorporation and to the statutory provisions.
In general, any Officer, Director, employee or agent may be indemnified
against expenses, fines, settlements or judgments arising in connection with
a legal proceeding to which such person is a party, if that person's actions
were in good faith, were believed to the be in the Company's best interest,
and were not unlawful. Unless such person is successful upon the merits in
such an action, indemnification may be awarded only after a determination by
independent decision of the Board of Directors, by legal counsel, or by a
vote of the shareholders, that the applicable standard of conduct was met by
the person to be indemnified.
The circumstances under which indemnification is granted in connection
with an action brought on behalf of the Company is generally the same as
those set forth above; however, with respect to such actions, indemnification
is granted only with respect to expenses actually incurred in connection with
the defense or settlement of the action. In such actions, the person to be
indemnified must have acted in good faith and in a manner believed to have
been in the Company's best interest, and have not been adjudged liable for
negligence or misconduct.
<PAGE> 15
Indemnification may also be granted pursuant to the terms of agreements
which may be entered in the future or pursuant to a vote of shareholders or
Directors. The statutory provision cited above and the Company's Articles of
Incorporation also grant the power to the Company to purchase and maintain
insurance which protects its Officers and Directors against any liabilities
incurred in connection with their service in such a position, and such a
policy may be obtained by the Company.
ITEM 13. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.
The financial statements are included on Pages F-1 through F-7 herein.
ITEM 14. DISAGREEMENTS WITH ACCOUNTANTS, AND ACCOUNTING AND
FINANCIAL DISCLOSURE.
There have been no disagreements on accounting and financial disclosures
from the inception of the Company through the date of this Registration
Statement.
ITEM 15. FINANCIAL STATEMENTS AND EXHIBITS.
Financial Statements begin on following page.
<PAGE> 16
HOCKER, LOVELETT, HARGENS & YENNIE, P.C.
Certified Public Accountants
REPORT OF INDEPENDENT ACCOUNTANTS
Board of Directors
Quintessence Oil Company, a Wyoming Corporation
Riverton, Wyoming
We have examined the balance sheet of Quintessence Oil Company, a Wyoming
Corporation, (A Development Stage Company) as of September 30, 1996 and the
related statements of operations, changes in stockholders' equity and cash
flows from the date of inception (June 26, 1996) through September 30, 1996.
These financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these financial
statements based on our audit.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements.
An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Quintessence Oil Company, a
Wyoming Corporation, (A Development Stage Company) at September 30, 1996 and
the results of its operations, changes in stockholders' equity and changes in
its cash flows from the date of inception (June 26, 1996) through September
30, 1996 in conformity with generally accepted accounting principles.
Hocker, Lovelett, Hargens & Yennie, P.C.
Certified Public Accountants
Riverton, Wyoming
October 16, 1996
F-1
<PAGE> 17
QUINTESSENCE OIL COMPANY
A Wyoming Corporation
(A Development Stage Company)
BALANCE SHEET
September 30, 1996
<TABLE>
ASSETS
<S> <C>
CURRENT ASSETS
Cash $ 42,302
OTHER ASSETS (Note 1)
Organization costs 7,500
-------
Total Assets $ 49,802
=======
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts Payable $ 9,000
STOCKHOLDERS' EQUITY (Notes 1 and 2)
Common Stock - $.00001 par value,
50,000,000 shares authorized,
1,000,000 shares issued and outstanding 10
Additional paid in capital 42,490
Retained earnings (deficit) (1,698)
-------
Total Liabilities and Stockholders' equity $ 49,802
=======
</TABLE>
See accompanying notes to financial statements.
F-2
<PAGE> 18
QUINTESSENCE OIL COMPANY
A Wyoming Corporation
(A Development Stage Company)
STATEMENT OF OPERATIONS
for the period from inception (June 26, 1996) through September 30, 1996
<TABLE>
<S> <C>
INCOME
None $ -
OPERATING EXPENSES
General and Administrative Expenses 1,698
-------
NET INCOME (LOSS) $ (1,698)
=======
NET INCOME (LOSS) PER SHARE NIL
=======
</TABLE>
The company is in the development stage and has not commenced operations.
See accompanying notes to financial statements.
F-3
<PAGE> 19
QUINTESSENCE OIL COMPANY
A Wyoming Corporation
(A Development Stage Company)
STATEMENT OF CASH FLOW
for the period from inception (June 26, 1996)
through September 30, 1996
<TABLE>
<S> <C>
CASH FLOWS PROVIDED (USED)
IN OPERATIONS
Net loss $ (1,698)
Increase in Accounts Payable 9,000
-------
7,302
-------
CASH FLOWS PROVIDED (USED)
IN INVESTING ACTIVITIES
Organization Costs (7,500)
-------
CASH FLOWS PROVIDED (USED)
IN FINANCING ACTIVITIES
Proceeds from sale of stock 50,000
Payment made for legal fees
on registration costs (7,500)
-------
42,500
-------
NET INCREASE IN CASH 42,302
CASH BEGINNING OF PERIOD --
-------
CASH END OF PERIOD $ 42,302
=======
</TABLE>
See accompanying notes to financial statements.
F-4
<PAGE> 20
QUINTESSENCE OIL COMPANY
A Wyoming Corporation
(A Development Stage Company)
STATEMENT OF STOCKHOLDERS' EQUITY
June 26, 1996 (Inception) through September 30, 1996
<TABLE>
<CAPTION>
Common Stock Additional
Paid-in Retained
Shares Amount Capital Earnings
<S> <C> <C> <C> <C>
BALANCE
Inception 6/26/96 -- $ -- $ -- $ --
ADD:
Sale of 900,000 shares
of common stock for
$18,000 cash 900,000 9 17,991 --
Sale of 100,000 shares
of common stock for
$32,000 cash less
$7,500 Registration
Costs 100,000 1 24,449
Net (Loss) for the
period (1,698)
--------- ------ ------- -------
BALANCE, 9/30/96 1,000,000 $ 10 $ 42,490 $ (1,698)
========= ===== ======= =======
</TABLE>
See accompanying notes to financial statements.
F-5
<PAGE> 21
QUINTESSENCE OIL COMPANY
A Wyoming Corporation
(A Development Stage Company)
Notes to Financial Statements
NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICES:
Organization:
Quintessence Oil Company was incorporated on June 26, 1996, under the laws
of the State of Wyoming. The Company has adopted a year ending of December
31.
The Company was organized to engage in the development, production and sale
of oil and gas. since its inception, the Company has been largely inactive
and has conducted no significant operations The Company does not own any
oil and gas leases.
Because of the speculative nature of the Company, there are significant
risks which are summarized as follows:
Newly formed company with no operating history and minimal assets.
Limited funds available for exploration and development.
Conflict-of-interest, as all employees have other part-time or full-
time employment.
The Company is considered to be in the development stage as defined in
Statement of Financial Accounting Standards No. 7. There have been no
operations since incorporation.
Summary of Significant Accounting Principles:
Registration costs will include fee payments for legal expenses relating to
the public stock offering. The offering was successful, and $7,500 of
legal fees were charged to additional paid-capital.
F-6
<PAGE> 22
QUINTESSENCE OIL COMPANY
A Wyoming Company
(A Development Stage Company)
Notes to Financial Statements
NOTE 2 - STOCKHOLDERS' EQUITY
Public Stock Offering:
The Common Stock is being offered and sold pursuant to an exemption from
registration contained in Reg. 504 of the Securities Act of 1993, as
amended, (the "Act"). Reg. 504 provides that the Company can sell
securities with an aggregate offering price not exceeding $1,000.000 within
a twelve (12) month period without registration with the Securities and
Exchange Commission.
The shares so issued will be without restriction and may be resold in
compliance with the Act. Applicable state laws, however, may impose
restrictions on sales and resales. Pursuant to Reg. 504, the Company is
not required to furnish any information to purchasers.
NOTE - 3 OFFICES AND EMPLOYEES
The company's office will be located at 4424 Skylane Avenue, Riverton,
Wyoming.
The company currently has no employees other than certain of its officers
and directors and does not anticipate a need to engage any full-time
employees so long as it is seeking and evaluating business opportunities.
the company has no retirement, pension, profit sharing or insurance plans
covering its officers and directors.
F-7
<PAGE> 23
EXHIBITS
Exhibit No. Description
3.1 Articles of Incorporation.
3.2 Bylaws of the Company.
27 Financial Data Schedule
<PAGE> 24
SIGNATURES
Pursuant to the requirements of Section 12 of the Securities Exchange
Act of 1934, the Registrant has duly caused this Form 10 Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized.
Dated this 2nd day of December, 1996.
QUINTESSENCE OIL COMPANY
BY: /s/ Nick Bebout, President
<PAGE> 25
EXHIBIT INDEX
Exhibit No. Description
3.1 Articles of Incorporation.
3.2 Bylaws of the Company.
27 Financial Data Schedule
<PAGE> 1
SECRETARY OF STATE
State of Wyoming
The Capitol
Cheyenne, Wyoming 82002-0020
* * * * *
ARTICLES OF INCORPORATION
OF
QUINTESSENCE OIL COMPANY
* * * * *
FIRST
The name of the corporation is QUINTESSENCE OIL
COMPANY.
SECOND
The principal office of the corporation in the state of
Wyoming is located at 4424 Skylane Ave., Riverton, Wyoming 82501.
The name and address of its resident agent is Nick Bebout, 4424
Skylane Avenue, Riverton, Wyoming 82501.
THIRD
The purpose or purposes for which the corporation is
organized:
To engage in and carry on any lawful business
activity or trade, and to engage in the development,
production and sale of oil and gas.
FOURTH
The number and class of shares which the corporation is
authorized to issue that together have unlimited voting rights
are fifty million (50,000,000) shares of common stock, par value
of $0.00001 per share, and the number and class of shares which
are entitled to receive the net assets of the corporation upon
dissolution are fifty million (50,000,000) shares of common
stock, par value $0.00001 per share.<PAGE>
<PAGE> 2
FIFTH
The governing board of this corporation shall be known
as directors, and the number of directors may from time to time
be increased or decreased in such manner as shall be provided by
the bylaws of this corporation.
SIXTH
The name and addresses of the incorporator signing the
Articles of Incorporation is as follows:
NAME POST-OFFICE ADDRESS
Conrad C. Lysiak West 601 First Avenue
Suite 503
Spokane, Washington 99204
SEVENTH
Meeting of stockholders may be held outside the State
of Wyoming, if the bylaws so provide. The books of the
corporation may be kept (subject to any provision contained in
the statutes) outside the State of Wyoming at such place or
places as may be designated from time to time by the directors or
in the bylaws of the corporation.
EIGHTH
This corporation reserves the right to amend alter,
change or repeal any provision contained in the Articles of
Incorporation, in the manner now or hereafter prescribed by
statute, or by the Articles of Incorporation, and all rights
conferred upon stockholders herein are granted subject to this
reservation.
NINTH
Voting rights of the common stock are not cumulative
and the holders of the common stock do not have preemptive rights
to subscribe for any securities of the corporation.
<PAGE> 3
TENTH
The corporation shall indemnify its officers,
directors, employees and agents to the full extent permitted by
the laws of the State of Wyoming.
I, THE UNDERSIGNED, being the incorporator hereinbefore
named, for the purpose of forming a corporation pursuant to the
laws of the State of Wyoming, do make and file these Articles of
Incorporation, hereby declaring and certifying that the facts
herein stated are true, and accordingly have hereunto set my hand
this 25th day of June, 1996.
/s/ CONRAD C. LYSIAK
<PAGE> 4
SECRETARY OF STATE
State of Wyoming
The Capitol
Cheyenne, Wyoming 82002-0020
CONSENT TO
APPOINTMENT BY REGISTERED AGENT
1. I, Nick Bebout, voluntarily consent to serve as the
registered agent for QUINTESSENCE OIL COMPANY on the date shown
below.
2. The registered agent certifies that he is: (circle one)
(a) An individual who resides in this state and whose
business office is identical with the registered
office; or
(b) A domestic corporation or not-for-profit domestic
corporation whose business office is identical
with the registered office; or
(c) A foreign corporation or not-for-profit foreign
corporation authorized to transact business in
this state whose business office is identical with
the registered office.
3. I know and understand the duties of a registered agent
as set forth in the 1989 Wyoming Business Corporation Act.
Dated this 25th day of June, 1996.
/s/ Nick Bebout
<PAGE> 1
BYLAWS
OF
QUINTESSENCE OIL COMPANY
I. SHAREHOLDER'S MEETING.
.01 Annual Meetings.
The annual meeting of the shareholders of this Corporation,
for the purpose of election of Directors and for such other
business as may come before it, shall be held at the
registered office of the Corporation, or such other places,
either within or without the State of Wyoming, as may be
designated by the notice of the meeting, on the fourth week
in May of each and every year, at 1:00 p.m., commencing in
1997, but in case such day shall be a legal holiday, the
meeting shall be held at the same hour and place on the next
succeeding day not a holiday.
.02 Special Meeting.
Special meetings of the shareholders of this Corporation may
be called at any time by the holders of ten percent (10%) of
the voting shares of the Corporation, or by the president,
or by the Board of Directors or a majority thereof. No
business shall be transacted at any special meeting of
shareholders except as is specified in the notice calling
for said meeting. The Board of Directors may designate any
place, either within or without the State of Wyoming, as the
place of any special meeting called by the president or the
Board of Directors, and special meetings called at the
request of shareholders shall be held at such place in the
State of Wyoming, as may be determined by the Board of
Directors and placed in the notice of such meeting.
.03 Notice of Meeting.
Written notice of annual or special meetings of shareholders
stating the place, day, and hour of the meeting and, in the
case of a special meeting, the purpose or purposes for which
the meeting is called shall be given by the secretary or
persons authorized to call the meeting to each shareholder
of record entitled to vote at the meeting. Such notice
shall be given not less than ten (10) nor more than fifty
(50) days prior to the date of the meeting, and such notice
shall be deemed to be delivered when deposited in the United
States mail addressed to the shareholder at his/her address
as it appears on the stock transfer books of the
Corporation.
<PAGE> 2
.04 Waiver of Notice.
Notice of the time, place, and purpose of any meeting may be
waived in writing and will be waived by any shareholder by
his/her attendance thereat in person or by proxy. Any
shareholder so waiving shall be bound by the proceedings of
any such meeting in all respects as if due notice thereof
had been given.
.05 Quorum and Adjourned Meetings.
A majority of the outstanding shares of the Corporation
entitled to vote, represented in person or by proxy, shall
constitute a quorum at a meeting of shareholders. A
majority of the shares represented at a meeting, even if
less than a quorum, may adjourn the meeting from time to
time without further notice. At such adjourned meeting at
which a quorum shall be present or represented, any business
may be transacted which might have been transacted at the
meeting as Originally notified. The shareholders present at
a duly organized meeting may continue to transact business
until adjournment, notwithstanding the withdrawal of enough
shareholders to leave less than a quorum.
.06 Proxies.
At all meetings of shareholders, a shareholder may vote by
proxy executed in writing by the shareholder or by his/her
duly authorized attorney in fact. Such proxy shall be filed
with the secretary of the Corporation before or at the time
of the meeting. No proxy shall be valid after eleven (11)
months from the date of its execution, unless otherwise
provided in the proxy.
.07 Voting of Shares.
Except as otherwise provided in the Articles of
Incorporation or in these Bylaws, every shareholder of
record shall have the right at every shareholder's meeting
to one (1) vote for every share standing in his/her name on
the books of the Corporation, and the affirmative vote of a
majority of the shares represented at a meeting and entitled
to vote thereat shall be necessary for the adoption of a
motion or for the determination of all questions and
business which shall come before the meeting.
<PAGE> 3
II. DIRECTORS.
.01 General Powers.
The business and affairs of the Corporation shall be managed
by its Board of Directors.
.02 Number, Tenure and Qualifications.
The number of Directors of the Corporation shall be not less
than one nor more than five. Each Director shall hold office
until the next annual meeting of shareholders and until
his/her successor shall have been elected and qualified.
Directors need not be residents of the State of Wyoming or
shareholders of the Corporation.
.03 Election.
The Directors shall be elected by the shareholders at their
annual meeting each year; and if, for any cause the
Directors shall not have been elected at an annual meeting,
they may be elected at a special meeting of shareholders
called for that Purpose in the manner provided by these
Bylaws.
.04 Vacancies.
In case of any vacancy in the Board of Directors, the
remaining Director, whether constituting a quorum or not,
may elect a successor to hold office for the unexpired
portion of the terms of the Director whose place shall be
vacant, and until his/her successor shall have been duly
elected and qualified.
.05 Resignation.
Any Director may resign at any time by delivering written
notice to the secretary of the Corporation.
.06 Meetings.
At any annual, special or regular meeting of the Board of
Directors, any business may be transacted, and the Board may
exercise all of its powers. Any such annual, special or
regular meeting of the Board of Directors of the Corporation
may be held outside of the State of Wyoming, and any member
or members of the Board of Directors of the Corporation may
participate in any such meeting by means of a conference
telephone or similar communications equipment by means of
which all persons participating in the meeting can hear each
other at the same time; the participation by such means
shall constitute presence in person at such meeting.
<PAGE> 4
A. Annual Meeting of Directors.
Annual meetings of the Board of Directors shall be held
immediately after the annual shareholders' meeting or
at such time and place as may be determined by the
Directors. No notice of the annual meeting of the
Board of Directors shall be necessary.
B. Special Meetings.
Special meetings of the Directors shall be called at
any time and place upon the call of the president or
any Director. Notice of the time and place of each
special meeting shall be given by the secretary, or the
persons calling the meeting, by mail, radio, telegram,
or by personal communication by telephone or otherwise
at least one (1) day in advance of the time of the
meeting. The purpose of the meeting need not be given
in the notice.
Notice of any special meeting may be waived in writing
or by telegram (either before or after such meeting)
and will be waived by any Director in attendance at
such meeting.
C. Regular Meetings of Directors.
Regular meetings of the Board of Directors shall be
held at such place and on such day and hour as shall
from time to time be fixed by resolution of the Board
of Directors. No notice of regular meetings of the
Board of Directors shall be necessary.
.07 Quorum and Voting.
A majority of the Directors presently in office shall
constitute a quorum for all purposes, but a lesser number
may adjourn any meeting, and the meeting may be held as
adjourned without further notice. At each meeting of the
Board at which a quorum is present, the act of a majority of
the Directors present at the meeting shall be the act of the
Board of Directors. The Directors present at a duly
organized meeting may continue to transact business until
adjournment, notwithstanding the withdrawal of enough
Directors to leave less than a quorum.
.08 Compensation.
By resolution of the Board of Directors, the Directors may
be paid their expenses, if any, of attendance at each
meeting of the Board of Directors and may be paid a fixed
sum for attendance at each meeting of the Board of Directors
<PAGE> 5
or a stated salary as Director. No such payment shall
preclude any Director from serving the Corporation in any
other capacity and receiving compensation therefor.
.09 Presumption of Assent.
A Director of the Corporation who is present at a meeting of
the Board of Directors at which action on any corporate
matter is taken shall be presumed to have assented to the
action taken unless his/her dissent shall be entered in the
minutes of the meeting or unless he/she shall file his/her
written dissent to such action with the person acting as the
secretary of the meeting before the adjournment thereof or
shall forward such dissent by registered mail to the
secretary of the Corporation immediately after the
adjournment of the meeting. Such right to dissent shall not
apply to a Director who voted in favor of such action.
.10 Executive and Other Committees.
The Board of Directors, by resolution adopted by a majority
of the full Board of Directors, may designate from among its
members an executive committee and one of more other
committees, each of which, to the extent provided in such
resolution, shall have and may exercise all the authority of
the Board of Directors, but no such committee shall have the
authority of the Board of Directors, in reference to
amending the Articles of Incorporation, adoption a plan of
merger or consolidation, recommending to the shareholders
the sale, lease, exchange, or other disposition of all of
substantially all the property and assets of the dissolution
of the Corporation or a revocation thereof, designation of
any such committee and the delegation thereto of authority
shall not operate to relieve any member of the Board of
Directors of any responsibility imposed by law.
.11 Chairman of Board of Directors.
The Board of Directors may, in its discretion, elect a
chairman of the Board of Directors from its members; and, if
a chairman has been elected, he/she shall, when present,
preside at all meetings of the Board of Directors and the
shareholders and shall have such other powers as the Board
may prescribe.
.12 Removal.
Directors may be removed from office with or without cause
by a vote of shareholders holding a majority of the shares
entitled to vote at an election of Directors.
<PAGE> 6
III. ACTIONS BY WRITTEN CONSENT.
Any corporate action required by the Articles of Incorporation,
Bylaws, or the laws under which this Corporation is formed, to be
voted upon or approved at a duly called meeting of the Directors
or shareholders may be accomplished without a meeting if a
written memorandum of the respective Directors or shareholders,
setting forth the action so taken, shall be signed by all the
Directors or shareholders, as the case may be.
IV. OFFICERS.
.01 Officers Designated.
The Officers of the Corporation shall be a president, one or
more vice presidents (the number thereof to be determined by
the Board of Directors), a secretary and a treasurer, each
of whom shall be elected by the Board of Directors. Such
other Officers and assistant officers as may be deemed
necessary may be elected or appointed by the Board of
Directors. Any Officer may be held by the same person,
except that in the event that the Corporation shall have
more than one director, the offices of president and
secretary shall be held by different persons.
.02 Election, Qualification and Term of Office.
Each of the Officers shall be elected by the Board of
Directors. None of said Officers except the president need
be a Director, but a vice president who is not a Director
cannot succeed to or fill the office of president. The
Officers shall be elected by the Board of Directors. Except
as hereinafter provide, each of said Officers shall hold
office from the date of his/her election until the next
annual meeting of the Board of Directors and until his/her
successor shall have been duly elected and qualified.
.03 Powers and Duties.
The powers and duties of the respective corporate Officers
shall be as follows:
A. President.
The president shall be the chief executive Officer of
the Corporation and, subject to the direction and
control of the Board of Directors, shall have general
charge and supervision over its property, business, and
affairs. He/she shall, unless a Chairman of the Board
of Directors has been elected and is present, preside
at meetings of the shareholders and the Board of
Directors.
<PAGE> 7
B. Vice President.
In the absence of the president or his/her inability to
act, the senior vice president shall act in his place
and stead and shall have all the powers and authority
of the president, except as limited by resolution of
the Board of Directors.
C. Secretary.
The secretary shall:
1. Keep the minutes of the shareholder's and of the
Board of Directors meetings in one or more books
provided for that purpose;
2. See that all notices are duly given in accordance
with the provisions of these Bylaws or as required
by law;
3. Be custodian of the corporate records and of the
seal of the Corporation and affix the seal of the
Corporation to all documents as may be required;
4. Keep a register of the post office address of each
shareholder which shall be furnished to the
secretary by such shareholder;
5. Sign with the president, or a vice president,
certificates for shares of the Corporation, the
issuance of which shall have been authorized by
resolution of the Board of Directors;
6. Have general charge of the stock transfer books of
the corporation; and,
7. In general perform all duties incident to the
office of secretary and such other duties as from
time to time may be assigned to him/her by the
president or by the Board of Directors.
D. Treasurer.
Subject to the direction and control of the Board of
Directors, the treasurer shall have the custody,
control and disposition of the funds and securities of
the Corporation and shall account for the same; and, at
the expiration of his/her term of office, he/she shall
turn over to his/her successor all property of the
Corporation in his/her possession.
<PAGE> 8
E. Assistant Secretaries and Assistant Treasurers.
The assistant secretaries, when authorized by the Board of
Directors, may sign with the president or a vice president
certificates for shares of the Corporation the issuance of
which shall have been authorized by a resolution of the
Board of Directors. The assistant treasurers shall,
respectively, if required by the Board of Directors, give
bonds for the faithful discharge of their duties in such
sums and with such sureties as the Board of Directors shall
determine. The assistant secretaries and assistant
treasurers, in general, shall perform such duties as shall
be assigned to them by the secretary or the treasurer,
respectively, or by the president or the Board of Directors.
.04 Removal.
The Board of Directors shall have the right to remove any
Officer whenever in its judgment the best interest of the
Corporation will be served thereby.
.05 Vacancies.
The Board of Directors shall fill any office which becomes
vacant with a successor who shall hold office for the
unexpired term and until his/her successor shall have
been duly elected and qualified.
.06 Salaries.
The salaries of all Officers of the Corporation shall be
fixed by the Board of Directors.
V. SHARE CERTIFICATES
.01 Form and Execution of Certificates.
Certificates for shares of the Corporation shall be in such
form as is consistent with the provisions of the Corporation
laws of the State of Wyoming. They shall be signed by the
president and by the secretary, and the seal of the
Corporation shall be affixed thereto. Certificates may be
issued for fractional shares.
.02 Transfers.
Shares may be transferred by delivery of the certificates
therefor, accompanied either by an assignment in writing on
the back of the certificates or by a written power of
attorney to assign and transfer the same signed by the
record holder of the certificate. Except as otherwise
<PAGE> 9
specifically provided in these Bylaws, no shares shall be
transferred on the books of the Corporation until the
outstanding certificate therefor has been surrendered to the
Corporation.
.03 Loss or Destruction of Certificates.
In case of loss or destruction of any certificate of shares,
another may be issued in its place upon proof of such loss
or destruction and upon the giving of a satisfactory bond of
indemnity to the Corporation. A new certificate may be
issued without requiring any bond, when in the judgment of
the Board of Directors it is proper to do so.
VI. BOOKS AND RECORDS.
.01 Books of Accounts, Minutes and Share Register.
The Corporation shall keep complete books and records of
accounts and minutes of the proceedings of the Board of
Directors and shareholders and shall keep at its registered
office, principal place of business, or at the office of its
transfer agent or registrar a share register giving the
names of the shareholders in alphabetical order and showing
their respective addresses and the number of shares held by
each.
.02 Copies of Resolutions.
Any person dealing with the Corporation may rely upon a copy
of any of the records of the proceedings, resolutions, or
votes of the Board of Directors or shareholders, when
certified by the president or secretary.
VII. CORPORATE SEAL.
The following is an impression of the corporate seal of this
Corporation:
VIII. LOANS.
Generally, no loans shall be made by the Corporation to its
Officers or Directors, unless first approved by the holder of
two-third of the voting shares, and no loans shall be made
by the Corporation secured by its shares. Loans shall be
permitted to be made to Officers, Directors and employees of the
Company for moving expenses, including the cost of procuring
housing. Such loans shall be limited to $25,000.00 per
individual upon unanimous consent of the Board of Directors.
<PAGE> 10
IX. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
.01 Indemnification.
The Corporation shall indemnify any person who was or is a
party or is threatened to be made a party to any proceeding,
whether civil, criminal, administrative or investigative
(other than an action by or in the right of the Corporation)
by reason of the fact that such person is or was a Director,
Trustee, Officer, employee or agent of the Corporation, or
is or was serving at the request of the Corporation as a
Director, Trustee, Officer, employee or agent of another
corporation, partnership, joint venture, trust or other
enterprise, against expenses (including attorneys' fees),
judgment, fines and amounts paid in settlement actually and
reasonably incurred by such person in connection with such
action, suit or proceeding if such person acted in good
faith and in a manner such person reasonably believed to be
in or not opposed to the best interests of the Corporation,
and with respect to any criminal action or proceeding, had
no reasonable cause to believe such person's conduct was
unlawful. The termination of any action, suit or proceeding
by judgment, order, settlement, conviction, or upon a plea
of nolo contendere or its equivalent, shall not, of itself,
create a presumption that the person did not act in good
faith and in a manner which such person reasonably believed
to be in or not opposed to the best interests of the
Corporation, and with respect to any criminal action
proceeding, had reasonable cause to believe that such
person's conduct was unlawful.
.02 Derivative Action
The Corporation shall indemnify any person who was or is a
party or is threatened to be made a party to any threatened,
pending or completed action or suit by or in the right of
the Corporation to procure a judgment in the Corporation's
favor by reason of the fact that such person is or was a
Director, Trustee, Officer, employee or agent of the
Corporation, or is or was serving at the request of the
Corporation as a Director, Trustee, Officer, employee or
agent of another corporation, partnership, joint venture,
trust or other enterprise, against expenses (including
attorney's fees) and amount paid in settlement actually and
reasonably incurred by such person in connection with the
defense or settlement of such action or suit if such person
acted in good faith and in a manner such person reasonably
believed to be in or not opposed to the best interests of
the Corporation, and, with respect to amounts paid in
settlement, the settlement of the suit or action was in the
best interests of the Corporation; provided, however, that
no indemnification shall be made in respect of any claim,
<PAGE> 11
issue or matter as to which such person shall have been
adjudged to be liable for gross negligence or willful
misconduct in the performance of such person's duty to the
Corporation unless and only to the extent that, the court in
which such action or suit was brought shall determine upon
application that, despite circumstances of the case, such
person is fairly and reasonably entitled to indemnity for
such expenses as such court shall deem proper. The
termination of any action or suit by judgment or settlement
shall not, of itself, create a presumption that the person
did not act in good faith and in a manner which such person
reasonably believed to be in or not opposed to the best
interests of the Corporation.
.03 Successful Defense.
To the extent that a Director, Trustee, Officer, employee or
Agent of the Corporation has been successful on the merits
or otherwise, in whole or in part in defense of any action,
suit or proceeding referred to in Paragraphs .01 and .02
above, or in defense of any claim, issue or matter therein,
such person shall be indemnified against expenses (including
attorneys' fees) actually and reasonably incurred by such
person in connection therewith.
.04 Authorization.
Any indemnification under Paragraphs .01 and .02 above
(unless ordered by a court) shall be made by the Corporation
only as authorized in the specific case upon a determination
that indemnification of the Director, Trustee, Officer,
employee or agent is proper in the circumstances because
such person has met the applicable standard of conduct set
forth in Paragraphs .01 and .02 above. Such determination
shall be made (a) by the Board of Directors of the
Corporation by a majority vote of a quorum consisting of
Directors who were not parties to such action, suit or
proceeding, or (b) is such a quorum is not obtainable, by a
majority vote of the Directors who were not parties to such
action, suit or proceeding, or (c) by independent legal
counsel (selected by one or more of the Directors, whether
or not a quorum and whether or not disinterested) in a
written opinion, or (d) by the Shareholders. Anyone making
such a determination under this Paragraph .04 may determine
that a person has met the standards therein set forth as to
some claims, issues or matters but not as to others, and may
reasonably prorate amounts to be paid as indemnification.
<PAGE> 12
.05 Advances.
Expenses incurred in defending civil or criminal action,
suit or proceeding shall be paid by the Corporation, at any
time or from time to time in advance of the final
disposition of such action, suit or proceeding as authorized
in the manner provided in Paragraph .04 above upon receipt
of an undertaking by or on behalf of the Director, Trustee,
Officer, employee or agent to repay such amount unless it
shall ultimately be by the Corporation is authorized in this
Section.
.06 Nonexclusivity.
The indemnification provided in this Section shall not be
deemed exclusive of any other rights to which those
indemnified may be entitled under any law, bylaw, agreement,
vote of shareholders or disinterested Directors or
otherwise, both as to action in such person's official
capacity and as to action in another capacity while holding
such office, and shall continue as to a person who has
ceased to be a Director, Trustee, Officer, employee or agent
and shall inure to the benefit of the heirs, executors, and
administrators of such a person.
.07 Insurance.
The Corporation shall have the power to purchase and
maintain insurance on behalf of any person who is or was a
Director, Trustee, Officer, employee or agent of the
Corporation, or is or was serving at the request of the
Corporation as a Director, Trustee, Officer, employee or
agent of another corporation, partnership, joint venture,
trust or other enterprise, against any liability assessed
against such person in any such capacity or arising out of
such person's status as such, whether or not the
corporation would have the power to indemnify such person
against such liability.
.08 "Corporation" Defined.
For purposes of this Section, references to the
"Corporation" shall include, in addition to the Corporation,
an constituent corporation (including any constituent of a
constituent) absorbed in a consolidation or merger which, if
its separate existence had continued, would have had the
power and authority to indemnify its Directors, Trustees,
Officers, employees or agents, so that any person who is or
was a Director, Trustee, Officer, employee or agent of such
constituent corporation or of any entity a majority of the
voting stock of which is owned by such constituent
corporation or is or was serving at the request of such
<PAGE> 13
constituent corporation as a Director, Trustee, Officer,
employee or agent of the corporation, partnership, joint
venture, trust or other enterprise, shall stand in the same
position under the provisions of this Section with respect
to the resulting or surviving Corporation as such person
would have with respect to such constituent corporation if
its separate existence had continued.
X. AMENDMENT OF BYLAWS.
.01 By the Shareholders.
These Bylaws may be amended, altered, or repealed at any
regular or special meeting of the shareholders if notice of
the proposed alteration or amendment is contained in the
notice of the meeting.
.02 By the Board of Directors.
These Bylaws may be amended, altered, or repealed by the
affirmative vote of a majority of the entire Board of
Directors at any regular or special meeting of the Board.
XI. FISCAL YEAR.
The fiscal year of the Corporation shall be set by resolution of
the Board of Directors.
XII. RULES OF ORDER.
The rules contained in the most recent edition of Robert's Rules
or Order, Newly Revised, shall govern all meetings of
shareholders and Directors where those rules are not inconsistent
with the Articles of Incorporation, Bylaws, or special rules or
order of the Corporation.
XIII. REIMBURSEMENT OF DISALLOWED EXPENSES.
If any salary, payment, reimbursement, employee fringe benefit,
expense allowance payment, or other expense incurred by the
Corporation for the benefit of an employee is disallowed in whole
or in part as a deductible expense of the Corporation for Federal
Income Tax purposes, the employee shall reimburse the
Corporation, upon notice and demand, to the full extent of the
disallowance. This legally enforceable obligation is in
accordance with the provisions of Revenue Ruling 69-115, 1969-1
C.B. 50, and is for the purpose of entitling such employee to a
business expense deduction for the taxable year in which the
repayment is made to the Corporation. In this manner, the
Corporation shall be protected from having to bear the entire
burden of disallowed expense items.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
Statement of Financial Condition at September 30, 1996 and the Statement
of Income for the six months ended September 30, 1996 and is qualified in
its entirety by reference to such financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> OTHER
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> SEP-30-1996
<CASH> 42,302
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 42,302
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 49,802
<CURRENT-LIABILITIES> 9,000
<BONDS> 0
0
0
<COMMON> 42,490
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 49,802
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> (1,698)
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (1,698)
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (1,698)
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
