UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-SB
GENERAL FORM FOR REGISTRATION OF SECURITIES
SMALL BUSINESS ISSUERS
UNDER SECTION 12 (b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934
Marina Capital, Inc.
(Name of Small Business Issuer in its charter)
Utah 87-0554-016
.......................... ........................
(State or other jurisdiction (IRS Employer Identification Number)
of incorporation or organization)
2605 Wall Ave., Ogden, Utah 84401 (801) 394-2400
..................................... .........................
(Address of principal executive offices) (Issuer's Telephone Number)
Securities to be registered pursuant to section 12 (b) of the Act:
Title of each class Name of each exchange on which
each class is to be registered:
N/A N/A
................... ...................
Securities to be registered pursuant to section 12 (g) of the Act:
Title of each class Name of each exchange on which
each class is to be registered:
Common stock
..................... ...................
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Marina Capital, Inc.
FORM 10-SB
TABLE OF CONTENTS
PART I
Item 1 Description of Business...........................................3
Item 2 Management's Discussion and Analysis or Plan of Operation........15
Item 3 Properties
Item 4 Security Ownership of Certain Beneficial Owners and Management...16
Item 5 Directors and Executive Officers.................................16
Item 6 Executive Compensation...........................................19
Item 7 Certain Relationships and Related Transactions...................19
Item 8 Description of Securities........................................20
PART II
Item 1 Legal Proceedings................................................21
Item 2 Market Price of Securities and Dividends on the Registrant's
Common Equity and Other Shareholder Matters......................21
Item 3 Changes and Disagreements with Accountants.......................22
Item 4 Recent Sales of Unregistered Securities..........................22
Item 5 Indemnification of directors and Officers........................23
PART III
Item 1 Index to Exhibits................................................24
Item 2 Description of Exhibits..........................................25
PART IV
Item 1 Financial Statements.............................................25
Item 2 Financial Statements.............................................25
Item 3 Financial Statements and Exhibits................................25
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PART I
ITEM 1. DESCRIPTION OF BUSINESS
Forward-looking Statements
This Registration Statement includes forward-looking statements within the
meaning of Section 21E of the Securities Exchange Act of 1934 (the "Exchange
Act"). These statements are based on management's beliefs and assumptions,
and on information currently available to management. Forward-looking
statements include statements in which words such as "expect," "anticipate,"
"intend," "plan," "believe," "estimate," "consider," or similar expressions
are used.
Forward-looking statements are not guarantees of future performance. They
involve risks, uncertainties and assumptions. The Company's future results
and stockholder values may differ materially from those expressed in these
forward-looking statements. Many of the factors that will determine these
results and values are beyond the Company's ability to control or predict.
In addition, the Company does not have any intention or obligation to update
forward-looking statements after the effectiveness of this Registration
Statement even if new information, future events or other circumstances have
made them incorrect or misleading. For these statements, the Company claims
the protection of the safe harbor for forward-looking statements contained in
Section 21E of the Exchange Act.
Marina Capital, Inc. (the "Company") was incorporated in the State of Utah on
the 5th day of March, 1996, as a Subchapter-S Corporation. The Subchapter-S
Corporation election was terminated by the Company as of January 1, 1997. The
Company is considered as being in the development stage.
The Company is, and has been for the past three years, a development stage
Company that is in the business of real estate development, real estate
sales, mortgage brokering, land planing and business consulting. The Company
identifies and develops specific parcels of real property in various
locations within the State of Utah and other geographical locations. The
real property may be acquired through outright purchases, lease, options or
through other acceptable arrangements. In addition, the Company in some
instances may act as a lender, broker, marketer or business consultant for
other companies.
Business
The Company is a development stage Company which is comprised of a group of
highly experienced professionals, specializing in real estate planning,
development, sales, mortgage banking, marketing, consulting, acquisitions and
business development. The management group has accumulated years of
experience providing services in the areas of management, accounting,
advertising, marketing, land planning, legal, mortgage banking, real estate
sales, real estate development, and the raising of capital through equity and
debt financing. Thus the Company is uniquely structured to operate as a real
estate developer, broker, mortgage lender, principal, facilitator, marketer,
consulting and joint venture partner.
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The Company specializes primarily in the development of real estate projects
and real estate sales in the State of Utah, but will consider other
geographical areas as opportunities arise. The Company develops its own
residential, recreational and commercial projects as well as provides
consulting and professional services for other developers.
The Company is also the manager of Marina Holdings, LLC, a Utah Limited
Liability Company and is the sole member. Marina Holding, LLC is the manager
of Shupe-Williams Plaza, LLC, a Utah Limited Liability Company. Shupe-Williams
Plaza, LLC, is the owner (by Warranty Deed) of the Shupe-Williams property
located at 2605 Wall Ave, Ogden, Utah.
Divisions
The Company is composed of three (3) divisions: (a) Marina Capital
Development Services-land planning/engineering and consulting; (b) Marina
Capital-real estate sales and marketing; and (c) Marina Capital Mortgage-
originating, processing and funding construction and mortgage loans. The
Company utilizes the services of each division for its own projects. The
Company may also contract with third parties that require the services
provided by each division.
The Company began its real estate sales business in January of 1997, opening
the Ogden, Utah office in March of 1997, and the San Francisco office in
April, 1998. The Company has four real estate sales associates and one
mortgage loan originator.
The Market
Utah's business growth over the past several years has been extensive.
The selection of Salt Lake City as the site of the 2002 WINTER OLYMPIC
GAMES, the State's robust economy, its job creation and excellent quality of
life, have contributed in generating Utah's continued national attention.
Such rapid economic growth gives rise to continued real estate development and
growth. Demand for commercial, residential, and recreation property continues
to outpace supply, despite record breaking new construction and development.
The real estate market presents numerous opportunities. The Company has
positioned itself in such a way as to be able to take advantage of the
expected continued growth throughout the next decade, keeping in mind
environmental issues and concerns, as well as community needs and desires.
In the past decade, a large number of new high-technology companies have
commenced and prospered in the Salt Lake City - Provo - Ogden, Utah areas.
With these new endeavors has come a well-educated work force. Numerous
construction and service businesses have converted the area into a metro-plex
of nearly 2 million people. Utah's growth over the past several years has
been extensive. There are many indications that the growth will continue
into the foreseeable future.
Employment. Utah's current employment boom is unprecedented in terms of the
number of years of continued growth and the rates of increase. In 1996,
Utah's job growth rate was 5.3 percent, ranking second among all states.
Utah's job growth rate has now equaled or exceeded
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3.0% for nine (9) consecutive years and exceeded 5.0% in four straight years.
Never before in Utah's post World War II economic history has employment
increased at rates this high for such a sustained period.
The expansion of private sector jobs has fueled Utah's recent economic
prosperity. Since 1986, Utah added 321,700 jobs, with 92% of the growth
occurring in the private sector. Private sector employment increased from
78% of total employment to 83%. The fastest growing segments have been in
the construction (6.6%), and services (6.4%) industries.
Outlook. Utah's current economic prosperity is expected to continue through
1999 and beyond. Utah's young and educated work force, strong work ethic,
and low business costs help businesses succeed in Utah. The State government
has also successfully kept business taxes low and fostered a reasonable
regulatory environment. The substantial infrastructure investments slated
to occur during the next year, and subsequent years, will continue to
benefit the State's economy.
Perhaps the most important feature of the 1998 forecast has been the
prognosis for Utah's current construction boom, which is in its seventh year
of double-digit employment growth rates. The State Economic Coordinating
Committee expects construction to remain at historically high levels in 1999.
Construction projects of $25 million or more will proceed through 1999 which
includes such large projects as the reconstruction of Interstate 15,
completion of the Bangerter Highway, Light Rail, Snowbasin Ski Resort,
Kennecott Tailings Project the State Courts Complex, Huntsman Cancer
Institute, Orem Medical Center, the Central Utah Project, Micron's computer
Chip Factory, State of Utah Justice Center, American Towers and Gateway
buildings in downtown Salt Lake City, Thanksgiving Point, Orem Medical
Center, Weber Center, West Valley Hockey Arena, Salt Lake County Jail, Provo
One Freedom Center, Murray Corporate Center, Central Utah Project, Lake Park
Corporate Center, Proswood-Pegass Luxury Apartments, Geneva's Air Separation
plant, Danon's Yogurt Plant, and continuation of the I-15 Interstate
Expansions project.
The State Economic Coordinating Committee expects employment to grow at
about 4.2% in 1999. Population is forecast to increase at 2.1%, total wages,
8.5%, and personal income, 7.8%. Average wages are expected to grow faster
than inflation for the third consecutive year.
Utah's Long-Term Projections. The demographic attributes that have
characterized Utah in the past (the youthful and rapidly growing population)
are projected to continue well into the next century. The relative strength
of the economy is expected to continue as well, although there will be some
convergence with national demographic and economic trends. Utah's population
and employment growth rates are projected to continue to out-pace those of
the nation for the 1998 through 2020 period. Utah's population is projected
to reach 3.3 million by the year 2020. This rate of population growth will
be sustained by a rapid rate of natural increase and a strong and diversified
economy.
The majority of the new Utahns will reside along the Wasatch Front Range.
The most rapid rates of growth are expected in the counties in southwestern
Utah, Grand County, Summit County and Wasatch County.
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Construction and Housing. The value of construction rose 13.5% to $3.5
billion in 1996 compared to $3.1 billion in 1995. Both residential and non-
residential construction reached record levels during 1996 with $2.1 billion
in residential construction value and $1 billion non-residential construction
value being permitted. New dwelling share permits reached a record level of
23,500. Population growth enhanced by net in-migration, strong economic and
job growth, low vacancy rates, and low mortgage interest rates, all have
contributed to this record year. Several large projects contributed to the
record year in nonresidential construction. These include projects such as the
$34.8 million library at Brigham Young University, the $27 million Prime Option
office building, and the $65 million Court Complex.
Housing prices in Utah over the past five years and in the most recent
12-month period have increased faster than any other State. From 1991 to
1997, Utah's house price index, as published by the Office of Federal
Housing Enterprise Oversight, increased by 72.7%. The house price index is
derived from repeat mortgage transactions on single-family homes whose
mortgages have been purchased by the Federal National Mortgage Association
and the Federal Home Loan Mortgage Corporation. The median sales price of
an existing single family home in the third quarter of 1996 was $123,100 in
Utah and $120,500 for the national average. Home ownership in Utah in 1995
ranked seventh highest in the nation at 73.1%.
The Company proposes to take advantage of the State's economic growth that
is expected to continue through the next decade. The Company will select
real estate projects and business opportunities that will generate above
average returns for the Company. The projects will be selected on the basis
of location, size, purchase price, feasibility and bottom line profits.
In some instances the Company will seek to option land, obtain all the
necessary approvals to subdivide these properties, pre-sell lots, exercise
purchase options on land, construct the infrastructure (roads, water, sewer,
etc.) and pay all the development costs in the expectation of realizing a
profit. The Company may elect to sell projects at any time during the
approval and development stage to another purchaser if profits warrant an
early sale. In other instances, the Company may elect to finance other
developers for an equity participation and eventual profits. The Company may
also elect to participate in joint ventures with existing landowners rather than
an option or outright purchase of the properties. On selected projects, the
Company may elect to offer financing and participate in real estate and mortgage
lending. The Company proposes to be a fully integrated Real Estate and Business
Development Company with in-house experience in development, construction,
acquisition, marketing, legal, financing and management.
PROJECTS
I. OlymPeak Estates
* Location: Ogden Valley, Utah, is four miles the from Snowbasin Ski
Resort will be the site of the 2002 Olympic down hill events and one
(1) hour from the Salt Lake City International Airport.
* Use: Phase One-65 acres zoned for building lots subdivided into 22
view lots. The lots are priced from $155,000 to $300,000. Six lots
have been pre-sold.
* Phase Two-365 acres that will have an 18 hole destination golf course
and planned
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Residential Unit Development (PRUD) 135 single family
lots, 35 condominiums, commercial space. Currently, the Company is
in negotiations with another developer to construct the project.
* Financing Required: Phase one-$ 1.0 million - Phase Two, course
construction $4.0 to $6.0 million - Construct infrastructure - $5.0
to 8.0 million.
* Potential profit estimate: Phase one-$ 1.5 million ; Phase two - $10
to $15 million.
Phase One:
The OlymPeak Estate project consists of 22 view lots located in Ogden Valley
approximately four (4) miles from the Snow Basin Ski Resort.
Preliminary approval was obtained from Weber County on March 14, 1996. The
final approval will be subject to the State of Utah Engineer and Weber County
approval of the water and sewer system by the County.
The Company anticipates that final approval will be granted within three (3)
to six (6) months from the date of this Registration Statement. Upon
receiving the final approval construction on the roads, water and sewer
system will commence and will take approximately three (3) to six (6) months
to complete.
Six (6) of the lots have been reserved at a sale price between $155,000 to
$226,000 per lot.
The Company has prepared the necessary documentation to form a not for profit
Water and Sewer District to service the area. The documentation will be
submitted to the State of Utah Engineer for approval within the next ninety
(90) days.
The Company exercised its option to purchase the OlymPeak Estate property on
October 31, 1996 and entered into a five (5) year Purchase Agreement with
the Maughan Family Partnership. The Company executed a Trust Deed and Note
for the balance of the purchase price of $725,000. The original purchase
price was $975,000. The terms of the note are as follows: A five (5) year
Note, twenty (20) year amortization schedule, with annual payments of $75,000
and a balloon payment at the end of the five (5) year period for the balance.
The Company proposes to spend approximately $1,000,000 in the construction of
roads, water and sewer system for Phase One.
Phase Two:
The OlymPeak Village project is a Planned Residential Unit Development (PRUD)
located on approximately 365 acres in Weber County, Utah. The current zoning
for the property is FR-3.
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OlymPeak Village, is a destination resort, consisting of an 18 hole golf
course with clubhouse, commercial space, 145 single family view lots, and 35
condominium units.
The project will include two ski lifts and facilities to teach beginning
skiers.
This project will cost approximately $ 15,000,000 to complete.
OlymPeak Village is located approximately four (4) miles from the Snowbasin
Ski Resort and three (3) miles from Pineview Reservoir. The site has views
of Mt. Ogden to the west, and Pineview Reservoir to the east.
The project will be serviced by water from the OlymPeak Estates water system
and by an aerated lagoon sewer system located on the property. The PRUD is a
cluster development which includes commercial development, single-family lots
and homes, golf and ski area plus open space. The costs for infrastructure will
be greatly reduced by clustering and can be further reduced by allowing
connections to third party lot owners along Snowbasin Road.
The Company proposes to identify a joint venture partner or seek financing
from conventional sources in order to finance Phase One and Phase Two of the
project.
II. Ski Inn at Powder Mountain
Location. The Ski Inn at Powder Mountain property is located in Northern
Utah, Cache County, and is adjacent to the main parking lot at Powder Mountain
Ski Resort, eight miles from Eden, Utah. The property is located one hour
from the Salt Lake City International Airport, and thirty minutes from Ogden,
Utah.
Description. The proposed Ski Inn at Powder Mountain project is located on a
two (2) acre parcel of mountainous unimproved land with access through the
Powder Mountain Resort parking lot. The ski lifts and trails can be skied
directly to and from the property.
Current Use. The property is currently zoned FR-40 (conditional use permit).
Proposed Use. The Company proposes to construct a Hotel/Condominium building
consisting of 48 units for sale or rent.
The Company exercised its option on December 31, 1996 and in an arms length
transaction, acquired the property from Ski Inn At Powder Mountain, a Limited
Partnership in which Mr. Larry R. Walker, a director and president of the
Company was the General Partner. The Limited Partnership received 60,000 shares
of the Company's $.001 par value Common Stock in consideration for the
properties valued at $120.000. The Company proposes to allocate approximately
$50,000 for the necessary entitlement work in order to obtain development
approval from the county.
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III. Shupe-Williams Plaza
Location. Shupe-Williams Plaza at 26th Street and Wall Avenue near Historic
25th Street in downtown Ogden, Utah.
Description. The Shupe-Williams Plaza Building is a four-story building of
approximately 62,500 feet located on an 85,000 square foot building lot.
The building was built in 1902 and was used as a warehouse and candy
manufacturing facility. The building has been abandoned for 15 years.
Current Zoning. With the assistance of the City of Ogden, the property and
building have been zoned to accommodate both residential and commercial use.
Proposed Use. The Company is currently rehabbing the building and vacant lot.
The main floor will be converted into a restaurant, office and retail use.
The upper floors will be converted to Live/Work lofts. Six (6) penthouse
lofts will be constructed on top of the building.
Status. The Shupe-Williams Plaza property was conveyed to Shupe-Williams Plaza,
LLC by the Ogden City Corporation and the Ogden City Developmental Agency on May
27, 1998. The total purchase price was $100.00. The City has also agreed to
rebate $250,000 in taxes, over a five-year period.
Estimated Revenue Phase One. $6,000,000 to $7,500,000.
Financing. The Company is in the process of financing the construction phase
and has made application with several financial brokers and institutions. The
first phase of construction was started in September of 1998. The Company
expects construction to be completed within twelve (12) to eighteen (18)
months after financing has been approved. The Company has started to pre-
sell and market the lofts. Currently twenty (20) of the units have been
reserved. A trust account has been set up to hold reservation deposits until
construction of the building is complete. In addition, several Letters of
Intent to lease space have been received.
Recent and Significant Developments (Shupe-Williams Plaza)
The Company entered into a Real Estate Purchase Contract on October 8, 1997,
with the City of Ogden, Utah, and Ogden City Neighborhood Development Agency,
to purchase the Shupe-Williams Building located at 2605 Wall Avenue, including
the abandoned portion of 26th Street. The total purchase price was one hundred
dollars ($100.00). The City has also agreed to tax increment rebates totaling
$250,000. The rebate will be made to the Company over a five (5) year period.
The closing date on the building was May 27, 1998 at which time fee simple title
was conveyed to the Company.
An Agreement was entered into with the Land Development Group of Provo, Utah
to act as developer/consultants for the conversion of the old Shupe-Williams
candy manufacturing building. The building will be converted into a forty-five
(45) Live/Work loft-condominium complex plus commercial and retail space. The
building was built in 1902, has four (4) floors (approximately
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62,500-sq. ft.) on a two (2) acre lot. The proposed sale of the lofts is
expected to generate approximately $6,000,000 to $7,500,000 in revenue. The
Land Development Group has in the past, successfully converted buildings in
Houston, Texas; San Diego, California and Salt Lake City, Utah.
In February of 1999, negotiations were initiated with WADMAN INVESTMENTS L.L.C.
to form a joint venture development to construct a four seasons golf and ski
resort on property owned by both parties. In addition, an application has been
applied for with the Utah State Engineer to form a Water and Sewer District to
be jointly managed by WADMAN INVESTMENTS L.L.C. and the Company.
Business Opportunities
On May 15, 1996, the Company entered into a Letter of Understanding with VR
Utah, Inc., dba Business Resource Center. The Letter of Understanding sets
forth the terms whereby the parties can assist and co-operate with each other
from time to time in identifying business opportunities that may be of
beneficial and financial interest to each party. VR Utah Inc. was founded
in Ogden, Utah in September, 1981, by William J. Tabar, who is currently a
director of the Company. VR Utah, Inc.'s purpose, as a business broker, is
to assist business owners in the sale and/or valuation of its clients'
businesses. It provides expertise in the valuation and marketing of
businesses. VR Utah, Inc. also provides guidance in the selection and
purchase for those clients desiring ownership of a business.
VR Utah, Inc. expanded in 1983 to include offices in downtown Salt Lake City
and Murray, Utah. In 1990, an additional location was opened in St. George,
Utah. Business Resource Center is a member of International Business Brokers
Association, which has over 800 members. Since its founding, VR Utah, Inc.
has assisted in the sale of approximately one thousand businesses.
In many instances, VR Utah's clients and customers require consulting services.
The consultation may include financing options for equity, debt or a
combination of both. The Company may seek to assist businesses which have
recently commenced operations, development stage companies in need of
additional capital for expansion into new markets, businesses seeking to
develop a new product or service, and established businesses which may be
experiencing financial or operating difficulties and are in need of additional
capital. In addition to those businesses that VR Utah, Inc. may refer to the
Company, the Company believes that there are numerous other business entities
which will benefit from the infusion of capital. Thus, the Company believes
ample business opportunities exist outside the real estate area.
The Company proposes to charge a fee for business consulting services. The
compensation may be in the form of a consultation fee, an equity position in
the business or a combination of both.
Acquisition Funding
The Company has identified three new projects that fit within the Company's
profile for funding.
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Wolf Creek Country Club Resort
* Location: Eden, Utah in Ogden Valley.
* Use: 2,000 acres zoned mixed use, approximately 1321 on building lots
and 25 acres are zoned for Commercial use.
* Financing Required: $20,000,000 for purchase.
* Potential Profit Estimate: $20,000.000.
Lite Speed Displays, Inc.
A Utah based Company, manufacturing portable sales presentation systems for
the corporate market, both nationally and internationally. The Company is
seeking $180,000.00 to expand its manufacturing and sales operation. The
potential profit is estimated to be $ 1,000,000 to $4,500,000 over the next
3 years.
T-RAX!
This Company manufactures a specialty sports cargo carrier designed to carry
bicycles, skis and snow-boards. The Company is based in Utah. An
investment of $500,000 is required to purchase the patent rights and
expand the manufacturing facilities and operation.
Competition
The Company may face direct competition from other business and real estate
development projects in the area, and it is possible that additional
competitors will enter the Company's market. The real estate industry is
highly competitive and consists of several medium and large companies who are
better financed than the Company. These competitive properties may be priced
lower than the price at which the property will be sold, and in some instances,
may have amenities superior to those of the Company's property. In addition,
there may be other real estate sales offices that may have more real estate
sales people and have a better marketing plan. There can be no assurance that
the Company will be able to compete successfully with present or future
competitors.
Regulation
The Company is not subject to any governmental regulations other than those
generally applicable to all businesses. However, the Company is regulated
to the extent it deals with Federal, State and local governments regarding
entitlements, such as, water, sewer, zoning and other utilities.
Employees
The Company presently has three (3) full time employees, four (4) real estate
agents and one (1) mortgage loan originator. Additional employees will be
hired as necessary to provide the Company's services and carry on its
operations as the Company expands.
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Risk Factors Relating to the Business of the Company
1. Limited 0perating History. The Company was organized on March 5, 1996, in
the State of Utah, and has limited operating history and is still in the
Development Stage. The Company is, in essence, a new venture and no assurance
can be given that the Company will be successful. Accordingly, the Company's
limited operating history, prohibits an effective evaluation of the potential
success of the Company.
The Company's viability and continued operations are dependent upon future
profitability, its ability to generate cash flow from uncertainties related to
the real estate industry, and other business opportunities. (See "Competition"
and "Management".)
The Company's operations are subject to all of the risks inherent in the
establishment of a new business enterprise. The likelihood of success for the
Company must be considered in light of the problems, expenses, complications
and delays frequently encountered in connection with the development of a new
business and the competitive environment in which the Company operates. There
can be no assurance that the Company will be able to operate profitably in the
future. Its financial objectives must therefore be considered very speculative.
(See "FINANCIAL STATEMENTS".)
2. Need for Additional Financing. The Company may require additional working
capital or other funds at a later date for the expansion of its operations.
There is no assurance that the Company will be successful in obtaining
additional financing or that such financing will be available upon acceptable
terms to the Company.
3. Conflicts of Interest - General. The Company's Directors and Officers, are
or may become, in their individual capacities, officers, directors, controlling
shareholders and/or partners of other entities engaged in a variety of
businesses. Thus, there exists potential conflicts of interest including,
among other things, time, effort and corporate opportunity, involved in
participation with other business entities. (See "MANAGEMENT - - Directors
and Officers").
4. Lack of Market Study. The Company has not requisitioned a formal state or
regional wide marketing study by an independent marketing organization for its
own purposes, therefore, there can be no assurance that there is sufficient
demand to support real estate acquisitions, real estate development, real
estate mortgages and real estate sales in the State of Utah.
5. Reliance Upon Officers and Consultants. The ability of the Company to
operate successfully depends to a substantial degree upon its management and
consultants. The assembly of a strong management team is critical to the
success of the business.
6. Keyman Insurance. While the Company has obtained key-man insurance on its
CEO and COO in the sum of $250,000 for each, the insurance may not be enough
in the event of the loss of either or both. The loss of either party would
have an adverse affect on the Company.
7. No Assurance of Properties' Appreciation. There is no assurance that the
real properties will appreciate in value or upon the completed development,
that they can be sold at a profit. The
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marketability and value will depend upon many factors beyond the control of the
Company, and there is no assurance that there will be a ready market for the
properties at the time the Company desires to sell the properties. The future
value of the properties may be dependent upon developer demand for the
properties, and there can be no assurance that demand currently exists or that
it will exist in the future. The value of the properties may also be dependent
upon the ability of the Company or a developer or ultimate user to obtain the
required entitlements (zoning, utilities, roads, etc.), necessary to realize the
highest and best use of the properties and generate a profit. There can be no
assurance that all the entitlements can be obtained.
8. Real Property Investment. The Company will be subject to all of the risks
inherent in the ownership of real estate, including changes in the general or
local economic conditions, decreased demand for property, or similar matters
that will affect the ability of the Company to realize its goals. Such changes
can result from decreases in employment in the surrounding communities, changes
in supply and demand in the real estate market, fluctuating interest rates,
changes in zoning, and competing properties in the locality.
9. Competition. The Company may face direct competition from other developer's
projects in the area and it is possible that additional competitors will enter
the same markets as the Company's. The competitive properties may be priced
lower than the price at which the properties will be sold, and in some
instances, may have amenities superior to those properties under the Company's
control. There can be no assurance that the Company will be able to compete
successfully with present or future competitors.
10. Environmental Risks. The ownership and development of real property may
subject the Company to potential liability relating to hazardous materials
stored, used, or discharged on the properties and other matters relating to
environmental protection, which could adversely affect the Company. In
connection with the recent acquisition of the properties, the Company has
performed limited, informal environmental inquiries and found no material
environmental non-compliance or cleanup liabilities.
11. Dependence upon Utah Market and Economy. The Company's real estate
projects are all currently located within Weber and Cache Counties in the
State of Utah. The properties currently are undeveloped and are in most cases
in the raw land stage or, as in one case, an old abandoned building which is
in the process of being renovated and converted into live/work condominiums.
The Company's performance is linked to the economic conditions in the State
of Utah. A decline in the expanding economy of the State of Utah, generally,
may have a materially adverse affect on the financial condition of the Company.
12. Mortgage Loan Origination and Processing. Changes in interest rates can
have a variety of affects on the Company's mortgage loan origination
business. The market value of fixed-rate mortgage loans has a greater
sensitivity to changes in market interest rates than adjustable-rate mortgage
loans. To the extent an interest rate is established for a mortgage loan in
process prior to the time such mortgage loan is funded (a "locked pipeline
loan"), a gain or loss on the sale of such mortgage loan may result from
changes in interest rates during the period between the time the interest
rate is established and the time the mortgage loan is committed for sale.
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13. Dependence on Wholesale Brokers. The Company may, for a time, depend on
independent mortgage brokers, and to a lesser extent, on correspondent lenders,
for the origination and purchase of its mortgage loans. These independent
mortgage brokers deal with multiple lenders for each prospective borrower.
The Company competes with these lenders for the independent brokers' business
on the basis of price, service, loan fees, costs and other factors. The
Company's competitors also seek to establish relationships with such brokers,
who are not obligated by contract or otherwise to do business with the Company.
14. Real Estate Market Conditions. The Company's business may be adversely
affected by periods of economic slowdown or recession, which may be accompanied
by declining property values. Any material decline in property values reduces
the ability of borrowers to use equity in the property to support any
borrowings and increases the loan-to-value ratios of mortgage loans
previously made, thereby weakening collateral coverage and increasing the
possibility of a loss in the event of default. In addition, delinquencies,
foreclosures and losses generally increase during economic slowdowns and
recessions.
15. Options to Purchase Real Property. In most instances the Company
proposes to obtain control over properties by negotiating options. However,
if the Company is not able to complete the entitlement process through the
Federal, State, County or City Governments in time to be able to exercise its
options, the Company may lose its option monies and the monies expended for
the entitlement work. The Company not only would lose the option and
entitlement monies, which could be as little as $10,000 to upwards of
$100,000, but the lost opportunity to continue the development could
adversely affect the business of the Company.
16. Lack of Geographic Diversification. Since the Company's inception, the
Company has been involved in real estate projects primarily in the State of
Utah. Thus, the Company could be subject to adverse economic, political or
business developments and natural hazard risks that may effect the region.
If the regions real estate market should experience an overall decline in
property values, rates of delinquency, foreclosure, bankruptcy and loss of
mortgage business may be expected to increase substantially, as compared to
such rates in a stable or improving real estate market.
17. Limited Endeavors. While the Company may have access to other business
opportunities, the Company's financial resources are limited and, thus, may
not be able to generate sufficient revenues to make those endeavors
profitable. Therefore, the risks may out weigh any profits.
18. Year 2000 Compliance. The Company does not anticipate any problems with
Year 2000 Compliance. The Company, however, has been in contact with its
accountant, bankers, title companies and transfer agent and has been assured
that all are in Year 2000 Compliance. However, if these entities are not in
compliance, the Company may experience limited business interruptions. Should
noncompliance be an issue, the Company will change its accountant, banking
relationship, title companies or transfer agent.
14
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
During the next twelve months, the Company will continue in its development
and promotion of the various real estate projects in progress. The final
permit approvals on the OlymPeak project are expected. Construction funding
for the Shupe-Williams Building and construction should be in place. The
Company also expects to have identified other new projects.
While the Company has taken options and deposits on sales of OlymPeak lots
and Shupe-Williams Live/Work loft units, final sales will not be realized
until completion, which may not take place until the following year.
Revenues are not expected to be significant until that time.
As of December 31, 1998, the Company had cash totaling approximately $214,442.
During the fiscal years ending December 31, 1998 and 1997, the Company expended
$377,099 and $441,517 respectively to fund operations. In addition the Company
has expended $714,728 on land purchases and development.
Over the next twelve (12) months, it is anticipated that the Company will incur
operating expenses of approximately $425,000 and $18,000 in debt service. It is
expected that the Company's current cash position will be sufficient to satisfy
its cash requirements for the next six months. Additional cash will be
required to sustain operations.
The Company will be required to raise substantial additional financing in
future years. There can be no assurance that such funds will be sufficient
in the near term or that conditions and circumstances described herein may
not result in subsequent cash requirements by the Company in the immediate
future just to sustain operations. In the event of such developments,
attaining financing under such conditions may not be possible, or even if
additional capital may be otherwise available, the terms on which such
capital may be available may not be commercially feasible or advantageous.
During the next twelve months, the Company does not expect to make any
significant purchases of plant or equipment. Investments in development
projects will continue as cash availability permits.
The Company does not anticipate any significant changes in its number of
employees during the next twelve (12) months.
The Company has reviewed the primary operations of its core business and does
not anticipate any problems with Year 2000 Compliance. The Company's operation
is not reliant upon the proper functionality of any computer system other than
those used by third party vendors. The Company believes that its banking
relationships, transfer agent and title companies are Year 2000 Compliant.
Should any of these third party vendors not be Year 2000 Compliant, the Company
will experience little to no adverse material impact on its cash flow or
prohibit its ability to continue operations.
15
<PAGE>
ITEM 3. PROPERTIES
The Company's corporate office is located in Ogden, Utah along with associates
located in San Francisco, California; Denver, Colorado; Boston, Massachusetts;
Lake Tahoe, Nevada; England and Scotland.
Currently the Company maintains its corporate office at 2605 Wall Avenue, Ogden,
Utah. The office space is approximately 1,500-sq. ft. in the Shupe-Williams
Plaza Building. The Company owns the Shupe-Williams Plaza property and pays no
rent for the office space it utilizes.
ITEM 4. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
<TABLE>
The following table sets forth information as of the date hereof, based on
information obtained from the persons named below, with respect to the
beneficial ownership of the Common Stock by (i) each person known by the Company
to own beneficially 5% or more of the Common Stock, (ii) each director and
officer of the Company and (iii) all directors and officers as a group:
<CAPTION>
Name and Address Shares owned
of Beneficial Owner Beneficially (1) % Owned
<S> <C> <C>
Larry R. & Jean P. Walker 1,240,000 32%
195 Alhambra #3
San Francisco, CA 94123
Richard V. & Carolyn C. Murray 1,207,500 31%
3748 Divisadero Street
San Francisco, CA 94123
Sheila Kelly 281,333 7%
4775 Summit Ridge Drive
Reno, NV 89503
Sherren O'Toole 500 .013%
1120 Canyon Rd., #44
Ogden, UT 84404
William J. Tabar 37,500 1%
4185 Beus Dr.
Ogden, UT 84403
Russell C. Maughan 37,500 1%
1690 Shoshone Dr.
Ogden, UT 84403
Kevin Molinari 196,667 5.1%
2375 Bay Street
San Francisco, CA 94123
Jon R. Blanchard 37,500 1%
PO Box 3763
Park City, Utah 84060
Officers, Directors and 5% 3,038,500 78.2%
shareholders as a group
(7 in number)
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<PAGE>
<FN>
<F1>
(1) The number of shares of Common Stock owned are those "beneficially owned"
as determined under the rules of the Securities and Exchange Commission,
including any shares of Common Stock as to which a person has sole or shared
voting or investment power and any shares of Common Stock which the person
has the right to acquire within 60 days through the exercise of any option,
warrant or right.
(2) No officer, director or security holder listed above owns any warrants,
options or rights, with the exception of Kevin Molinari, who has options to
purchase an additional 600,000 shares of the Company's common stock. (See
"Certain Relationships and Related Transactions.")
</FN>
</TABLE>
ITEM 5. DIRECTORS AND EXECUTIVE OFFICERS
<TABLE>
The Directors and Officers of the Company are as follows:
<CAPTION>
Name Age Position
<S> <C> <C>
Larry R. Walker* 63 Director, President, CEO
Richard V. Murray* 47 Director, COO/Treasurer
Sherren O'Toole 59 Secretary
Sheila Kelly* 61 Director
William J. Tabar 68 Director
Russell C. Maughan 45 Director Chairman of Board
Jon R. Blanchard 36 Vice President of Development
Services
<FN>
<F*>
*These persons may be deemed "promoters" of the Company as that term is
defined under the Securities Act of 1933, as amended, and the rules and
regulations promulgated thereunder.
</FN>
</TABLE>
All Directors of the Company will hold office until the next annual meeting
of shareholders of the Company or until their successors are duly elected and
qualified.
The Officers of the Company are elected by the Board of Directors at the first
meeting after each annual meeting of the Company's shareholders, and hold
office until their death, or until they shall resign or have been removed.
Officers and Directors
Larry R. Walker/CEO. Mr. Walker has been President/CEO and Director since
the inception of the Company. He is the principal broker for Marina Capital
and Managing Member for the Shupe-Williams Plaza LLC. Mr. Walker has been a
developer and manager of a major ski resort in the State of Utah. He
established and managed a regional office for a national brokerage firm. Mr.
Walker has owned and managed a business and financial services consulting
company for small to medium sized businesses. Mr. Walker has been an executive
with an investment banking firm and president of Equitable Business & Financial
Services Inc., a business consulting firm, and SCOR Financial Associates, Inc.,
a securities consulting company. Mr. Walker also has had extensive business
management, real estate development, securities and financial planning
experience. He is a licensed Real Estate Broker and obtained his Real Estate
Brokers License from the State of Utah in 1982. He obtained a California
Real Estate Sales License in 1986. He also was an airline pilot for ten years.
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<PAGE>
Richard V. Murray/COO-Treasurer. Mr. Murray has been a Vice President and
Director since the inception of the Company. Mr. Murray has been engaged in
real estate as an investor, broker and developer since 1978. Mr. Murray has
been a featured speaker for several real estate investment and brokerage firms
specializing in commercial investment and development. Mr. Murray has also
been a consultant for corporate CEO's and other corporate executives engaged in
acquisition negotiations. Mr. Murray graduated Cum Laude from Holy Cross in
1973 with a Bachelor of Arts Degree in History. Mr. Murray obtained his
California Real Estate Brokers License in 1980. He is currently the Chief
Operating Officer and Principal Broker for the San Francisco Real Estate &
Investment office.
Sherren O'Toole/Secretary. Ms. O'Toole was selected by the Board of Directors
to fill the remaining term of office of Secretary upon the resignation of
Sheila Kelly in April of 1999. Ms. O'Toole has been involved in real estate
as an investor, sales agent, property manager and real estate office manager
for fifteen (15) years. Prior to that time, Ms. O'Toole was a Tax Technician
and Supervisory Manager for the Internal Revenue Service for fifteen (15)
years. Ms. O'Toole attended Weber State University in Ogden, Utah.
Sheila Kelly/Director. Ms. Kelly has been a Director of the Company since its
inceptioin and the Corporate Secretary through March of 1999. Ms. Kelly has
been involved in real estate as an investor, consultant and sales agent for
fifteen (15) years. Ms. Kelly has also consulted with clients in the
acquisition of residential and commercial real estate properties and has also
been involved in several condominium conversion projects. Ms. Kelly attended
Mon Fertiles Finishing School in Morges, Switzerland and obtained a Degree in
French Literature. Ms. Kelly obtained her Real Estate Sales License from the
State of California in 1973.
William J. Tabar/Business Development/Director. Mr. Tabar has been a Director
of the Company since May of 1997. Mr. Tabar was co-founder of VR Utah, Inc.
VR Utah, Inc. opened its first business brokerage office twenty (20) years ago
in Ogden, Utah. Mr. Tabar currently owns and manages four business brokerage
offices located throughout the State of Utah. Mr. Tabar is a member of the
International Business Broker Association, the M & A Source, and a Certified
Business Intermediary. Before co-founding VR Utah, Inc., Mr. Tabar was Chief
Operating Officer and Executive Vice President of Scott USA, a privately owned
company, which manufactured ski and motorcycle products domestically and
internationally. Mr. Tabar holds a M.S. Degree in Chemical Engineering from
West Virginia University.
Russell C. Maughan/Director. Mr. Maughan has been a Director of the Company
since May of 1997 and is currently Chairman of the Board. Mr. Maughan
presently serves as Vice President of Home Abstract & Title Co. in Ogden,
Utah, and has been an officer and director for the past twenty (20) years.
He is also a trustee, stockholder and trust officer of Home Abstract & Title
Co. Mr. Maughan is designated as a Utah Registered Abstractor and Licensed
Title Agent. Mr. Maughan is a General Partner of Wolf Creek Country Club
Associates. He is a member of the Ogden Chamber of Commerce, Utah
Homebuilders Legislative Affairs Committee and Ogden Board of Realtors. Mr.
Maughan has also been a Utah State Republican Party Delegate.
Jon R. Blanchard/Development Services. Mr. Blanchard is currently Vice
President of Marina Capital Development Services. Mr. Blanchard has been
involved in land planning and landscape
18
<PAGE>
architectural design since graduating from Kansas State University's College of
Architecture and Design in 1988. He has extensive experience in land planning,
landscape architectural design and consultation for various resort, hotel,
skiing, golf course, light industrial, retail commercial and residential
projects. Mr. Blanchard has prepared design construction documents, cost
estimates, specifications and bid documents of several parks throughout New York
City and has worked on high-end projects in 14 states. Mr. Blanchard is the
owner and president of 13 Design Studio in Park City, Utah. Mr. Blanchard has
done extensive work and consultation on Utah's Winter Sports Park, which will be
the site of all ski jumping, bobsled and luge events during the 2002 Winter
Olympics.
ITEM 6. EXECUTIVE COMPENSATION
<TABLE>
EXECUTIVE COMPENSATION TABLE
Annual Compensation
<CAPTION>
Name and Principal Other Total
Position Year Salary Compensation Compensation
<S> <C> <C> <C> <C>
Larry R. Walker 1999 $75,000 $9,600 $84,600
President/CEO
Richard V. Murray 1999 $75,000 $9,600 $84,600
Treasurer/COO
Jon R. Blanchard 1999 $62,400 $9,600 $72,000
Vice President/
Development Services
Sherren O'Toole 1999 $26,400 0 $26,400
Corporate Secretary
</TABLE>
The Company has entered into a seven (7) year Employment Agreement with its
CEO, Larry R. Walker and COO, Richard L. Murray. The Company pays both its
CEO and COO, $6,250 per month, and $800 per month expense/travel allowance.
The Company has entered into a three (3) year Employment Agreement with its
Vice President, Jon R. Blanchard. The Company will pay its Vice President of
Development Services, $62,400 per year and $800.00 per month miscellaneous
expense allowance.
Each outside Director receives $100.00 for attending meetings of the Board
of Directors and all Directors are reimbursed for out-of-pocket expenses
incurred in connection with the Company's business.
ITEM 7. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Company has not entered into any transactions during the last two fiscal
years with any director, executive officer, director nominee, or shareholder
of 5% or more, with the exception of Kevin Molinari. The Company on October
20, 1998, issued to Kevin Molinari 300,000 options to be exercised on or
before October 20, 2004, at an exercise price of $2.50 per share.
19
<PAGE>
Additionally, the Company issued to Kevin Molinari 200,000 options to be
exercised on or before December 14, 2004, at an exercise price of $2.50 per
share and 100,000 options to be exercised on or before May 15, 1999 at an
exercise price of $2.00 per share.
The Company has not entered into transactions with any member of the immediate
families of the foregoing persons (includes spouse, children, siblings, and in-
laws), nor is any such transaction proposed.
ITEM 8. DESCRIPTION OF SECURITIES
Common Stock
The authorized capital stock of the Company consists of 30,000,000 shares of
$.001 par value Common Stock. All shares have equal voting rights and are
non-assessable. Voting rights are not cumulative, and therefore, the holders
of more than fifty percent (50%) of the Common Stock of the Company could, if
they chose to do so, elect all the Directors.
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.
Holders of Common Stock are entitled to share equally in dividends when, and
if declared by the Board of Directors of the Company, out of funds legally
available thereof. The Company has not paid any cash dividends on its Common
Stock, and it is unlikely that any such dividends will be declared in the
foreseeable future.
As of the date hereof, the Company had outstanding 3,881,184 shares of common
stock.
Preferred Stock
The Company is authorized to issue 5,000,000 shares of Preferred Stock, no par
value, of which 84,259 shares have been issued and outstanding or subscribed for
as of May 15, 1999 the date hereof.
In general, any of the Company's Preferred Stock may be issued in series from
time to time with such designation, rights, preferences and limitations as
the Board of Directors of the Company may determine by resolution. The rights,
preferences and limitations of separate series of Preferred Stock may differ
with respect to such matters as may be determined by the Board of Directors.
This is to include, without limitation, the rate of dividends, method and
nature of payment of dividends, terms of redemption, amounts payable on
liquidation, sinking fund provisions (if any), conversion rights (if any),
and voting rights. The potential exists therefore, that additional preferred
stock might be issued which would grant additional dividend preferences and
liquidation preferences to preferred shareholders. Unless the nature of a
particular transaction and applicable statutes require such approval, the
Board of Directors has
20
<PAGE>
the authority to issue these shares without shareholder approval. The
issuance of Preferred Stock may have the effect of delaying or preventing change
in control of the Company without any further action by shareholders.
Dividends
The Company has never paid a cash dividend on its Common Stock nor does the
Company anticipate paying cash dividends on its Common Stock in the near
future. It is the present policy of the Company not to pay cash dividends
on the Common Stock but to retain earnings, if any, to fund growth and
expansion. Under Utah law, a company is prohibited from paying dividends if
the company, as a result of paying such dividends, would not be able to pay
its debts as they come due, or if the company's total liabilities and
preferences to preferred shareholders exceed total assets. Any payment of
cash dividends of the Common Stock in the future will be dependent upon the
Company's financial condition, results of operations, current and anticipated
cash requirements, plans for expansion, as well as other factors the Board of
Directors deems relevant.
PART II
ITEM 1. LEGAL PROCEEDINGS
The Company is not party to any pending litigation and none is contemplated
nor has been threatened.
ITEM 2. MARKET PRICE OF SECURITIES AND DIVIDENDS ON THE REGISTRANT'S COMMON
EQUITY AND OTHER SHAREHOLDER MATTERS
Market For Common Stock and Related Stockholder Matters:
There is no public trading market for the Company's Common Stock. The
Company intends to apply to have the Common Stock traded on the OTC Bulletin
Board. No assurance can be given that such application will be approved and,
if approved, that an active trading market for the Common Stock will be
established or maintained.
There are no outstanding options or warrants to purchase, or securities
convertible into, shares of Common Stock.
As of the date hereof, there are 3,701,284 shares of Common Stock that could
be sold pursuant to Rule 144 under the Securities Act of 1933, as amended
(the "Securities Act").
Holders of Record:
As of May 15, 1999, there were 76 holders of record of the Company's Common
Stock, and the number of beneficial holders was approximately 66.
21
<PAGE>
ITEM 3. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
There has been no change in principal independent accountants or reported
disagreements on any matter of accounting principles or procedures or
financial statement disclosures during the Company's two most recent fiscal
years.
ITEM 4. RECENT SALES OF UNREGISTERED SECURITIES
As of May 15, 1999 the Company had 3,881,184 shares of its $.001 par value
common stock issued and outstanding of which 3,701,284 shares were issued
in transactions exempt by reason of Section 4(2) of the Securities Act of
1933, as amended, and 179,900 shares were issued in transactions exempt by
reasons of Rule 504 of Regulation D promulgated pursuant to Section 3(b) of
the Securities Act of 1933, as amended.
Between February 20, 1996 and May 15, 1996, in connection with its formation,
the Company issued a total 2,703,000 common shares to each of its three (3)
founders, Larry R. Walker, received 1,230,000 shares, Richard V. Murray
received 1,230,000 shares, and Sheila Kelly was issued 243,000 shares. All
of the shares were issued at the par value of $.001, for a total consideration
of $48,688 in cash and services. The issuance was exempt by virtue of Section
4(2) of the Securities Act of 1933, as amended.
Between May of 1996 through March of 1999, the Company issued to twenty-seven
(27) individuals an aggregate of 784,481 shares of its common stock by virtue
of Section 4(2) of the Securities Act of 1933, as amended, for a total
consideration of $699,473 in cash, exchange for properties and services.
On April 28, 1997, the Company completed the issuance of 138,255 shares in a
transaction exempt by reason of Rule 506 of Regulation D and pursuant to
Section 4(6) of the Securities Act of 1933, as amended, at $2.00 per share
for a total consideration of $276,510.
Between August 8, 1997, and April 30, 1998, the Company issued 84,259 shares of
its no par value preferred stock to seven (7) people in transactions exempt by
reason of Section 4(2) of the Securities Act of 1933, as amended in
consideration of $220,778.
From February of 1998 to August of 1998, the Company issued 77,215 shares of its
common stock in transactions exempt by reason of Rule 505 of Regulation D
promulgated pursuant to Section 4(6) of the Securities Act of 1933, as amended,
at $3.25 per share for a total consideration of $250,949.
On April 14, 1999, the Company completed an exempt offering by virtue of a
504 of Regulation D and Section 3(b) of the Securities Act of 1933, as amended,
at $3.75 per share issued 179,900 shares for total proceeds of $674,625.
The Company exercised an option on December 31, 1996 and in an arms length
transaction, acquired property from Ski Inn at Powder Mountain, a Limited
Partnership in which Mr. Larry R. Walker, a Director and President of the
Company was the General Partner. The Limited
22
<PAGE>
Partnership received 60,000 shares of the Company's $.001 par value Common Stock
in consideration for the properties valued at $120,000.
ITEM 5. INDEMNIFICATION OF DIRECTORS AND OFFICERS
The corporation may indemnify any person who was or is a party or is threatened
to be made a party to any threatened, pending, or completed action, suit, or
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
he is or was a director, officer, employee, fiduciary or agent of the
corporation or is or was serving at the request of the corporation as a
director, officer, employee, fiduciary or agent of another corporation,
partnership, joint venture, trust, or other enterprise, against expenses
(including attorney fees), judgments, fines, and amounts paid in settlement
actually and reasonably believed to be in the best interests of the corporation
and, with respect to any criminal action or proceeding, had no reasonable cause
to believe his conduct was unlawful. The termination of any action, suit,
or proceeding by judgment, order, settlement, or conviction or upon a pleas
of nolo contenders or its equivalent shall not of itself create a presumption
that the person did not act in good faith and in a manner which he reasonably
believed to be in the best interests of the corporation and, with respect to
any criminal action or proceeding, had reasonable cause to believe his conduct
was unlawful.
The corporation may 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 its favor by reason of
the fact that he is or was a director, officer, employee, or agent of the
corporation or is or was serving at the request of the corporation as a
director, officer, employee, fiduciary or agent of another corporation,
partnership, joint venture, trust or other enterprise against expenses
(including attorney fees) actually and reasonably incurred by him in
connection with the defense or settlement of such action or suit if he acted in
good faith and in a manner he reasonably believed to be in the best interests of
the corporation; but no indemnification shall be made in respect of any claim,
issue, or matter as to which such person has been adjudged to be liable for
negligence or misconduct in the performance of his duty to the corporation
unless and only to the extent that the court in which such action or suit was
brought determines upon application that, despite the adjudication of liability,
but in view of all circumstances of the case, such person is fairly and
reasonably entitled to indemnification for such expenses which such court deems
proper.
To the extent that a director, officer, employee, fiduciary or agent of a
corporation has been successful on the merits in defense of any action, suit,
or proceeding referred to in (a) or (b) of this Article VII or in defense of
any claim, issue, or matter therein, he shall be indemnified against expenses
(including attorney fees) actually and reasonably incurred by him in connection
therewith.
Any indemnification under (a) or (b) of this Article VII (unless ordered by a
court) and as distinguished from (c) of this Article shall be made by the
corporation only as authorized in the specific case upon a determination that
indemnification of the director, officer, employee, fiduciary or agent is proper
in the circumstances because he has meet the applicable standard of conduct set
forth in (a) or (b)) above. Such determination shall be made by the board of
directors
23
<PAGE>
by a majority vote of a quorum consisting of directors who were not
parties to such action, suit, or proceeding, or, if such a quorum is not
obtainable, or, even if obtainable, a quorum of disinterested directors so
directs.
Expenses (including attorney's fees) incurred in defending a civil or criminal
action, suit or proceeding may be paid by the corporation in advance of the
final disposition of such action, suit or proceeding as authorized in Section
(d) of this Article, upon receipt of an undertaking by or on behalf of the
director, officer, employee or agent to repay such amount, unless it shall
ultimately be determined that he is entitled to be indemnified by the
corporation as authorized in this Article.
The board of directors may exercise the corporation's power to purchase and
maintain insurance on behalf of any person who is or was a director, officer,
employee or agent of the corporation, or is or was serving at the request of the
corporation as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, against any liability
asserted against him and incurred by him in any such capacity, or arising out of
his status as such, whether or not the corporation would have the power to
indemnify him against such liability under this Article.
The indemnification provided by this Article shall not be deemed exclusive of
any other rights to which those seeking indemnification may be entitled under
these Articles of Incorporation, the Bylaws, agreements, vote of the
shareholders or disinterested directors, or otherwise, both as to action in his
official capacity and as to action in another capacity while holding such
office, and shall continue as to a person who has ceased to be a director,
officer, employee or agent and shall inure to the benefit of the heirs and
personal representatives of such a person.
PART III
ITEM 1. INDEX TO EXHIBITS
The following list describes the exhibits filed as part of this Registration
Statement on Form 10-SB:
Exhibit No. Description of Document
3.1 Articles of Incorporation of Marina Capital, Incorporated.
3.2 Bylaws of Marina Capital, Incorporated.
4.0 Specimen form of Registrant's common stock.
10.1 Employment Agreement dated November 1, 1996 between Marina Capital,
Inc., and Larry R. Walker.
10.2 Employment Agreement dated November 1, 1996 between Marina Capital,
Inc., and Richard V. Murray.
24
<PAGE>
10.3 Employment Agreement dated April 1, 1999, between Marina Capital Inc.,
and John R. Blanchard.
10.4 Option Agreements dated, October 20, 1998, between Kevin Molinari and
Marina Capital, Inc. for 300,000 options.
10.5 Option Agreement dated, December 14, 1998, between Kevin Molinari and
Marina Capital, Inc. for 200,000 options.
10.6 Subscription/Option Agreement dated March 15, 1999, between Kevin
Molinari and Marina Capital, Inc. for 100,000 options.
10.7 Consent of Accountants.
23.0 Loan Agreement dated, October 31, 1996, between the Maughan Family
Trust and Marina Capital, Inc.
ITEM 2. DESCRIPTION OF EXHIBITS
The required exhibits are attached hereto, as noted in Item 1 above.
Pursuant to the requirements of Section 12 of the Securities Exchange Act of
1934, the registrant has duly caused this registration statement to be signed on
its behalf by the undersigned, thereunto duly authorized.
Marina Capital, Inc.
/s/ Larry Walker
____________________
by: Larry Walker
President
Date: August 20, 1999
PART IV
ITEM 1. FINANCIAL STATEMENTS
See pages F-1 to F-7
ITEM 2. FINANCIAL STATEMENTS
ITEM 3. FINANCIAL STATEMENTS AND EXHIBITS
25
ARTICLES OF INCORPORATION RECEIVED
OF MAR-5 1996
MARINA CAPITAL INCORPORATED Utah Div. of Corp.
& Comm. Code
KNOW ALL MEN BY THESE PRESENTS:
That we, the undersigned, natural persons of the age of twenty one years or
older, for the purpose of organizing a Corporation pursuant to the Utah Division
of Corporation Act, do hereby adopt the following Articles of Incorporation for
such Company:
FIRST: The name of the corporation is "Marina Capital Incorporated"
SECOND: The corporation shall have perpetual existence.
THIRD: (a) The purpose of the corporation is to engage in any lawful act or
activity for which corporations may be organized under the laws of the State of
Utah and or conduct any lawful business in the State of Utah or any other state,
territory, the District of Columbia, colony, or protectorate of the United
States of America and in any foreign country. To have one or more offices or
places of business within or without the State of Utah and to carry out any
lawful business authorized in these Articles outside the State of Utah.
(b) In furtherance of the foregoing purpose, the corporation shall have
and may exercise all of the rights, powers and privileges now or hereafter
conferred upon corporations organized under the laws of the State of Utah. In
addition, it may do everything necessary, suitable or proper for the
accomplishment of any of its corporation purposes including, but not limited to,
financial security underwriting, lending, real estate development, purchasing,
mergers, business acquisitions, marketing and sales.
FOURTH: (a) The aggregate number of shares which the corporation shall have
authority to issue is: Thirty Million (30,000,000) shares of common stock,
$.0O1 par value, and Five Mil1ion (5,000,000) shares of preferred stock, no par
value. These preferred shares may be issued in one or more series at the
discretion of the Board of Directors.
(b) Each shareholder of record shall have one vote for each share of
common stock standing in his or her name on the books of the corporation and
entitled to vote, except that in the election of directors he or she shall have
the right to vote such number of shares for as many persons as there are
directors to be elected. Cumulative voting shall not be allowed in the election
of directors or for any other purpose.
(c) No shareholder of the corporation shall have any preemptive or
similar right to acquire any additional unissued or treasure shares of stock, or
for other securities of any class, or for rights, warrants, or options to
purchase stock or for scrip, or for securities of any kind convertible into
stock or carrying stock purchase warrants or privileges.
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(d) The board of directors may, from time to time, distribute to the
shareholders in partial liquidation, out of stated capital or capital surplus of
the corporation, a portion of its assets, in cash or property, subject to the
limitations contained in the statues of Utah.
FIFTH: The board of directors shall be composed of not less than two nor more
than fifteen directors. The initial board of directors of the corporation who
shall serve as directors until the first annual meeting of shareholders or until
their successors are elected and shall qualify are as follows:
NAMES ADDRESS
Richard V. Murray 3748 Divisadero, San Francisco, CA 94123
Larry R. Walker 195 Alhambra # 3 San Francisco, CA 94123
SIXTH: The Company's initial Registered Agent and office address is:
Lauri Andersen 385 West Willow Ridge Circle, Centerville, Utah, 84014.
I hereby accept the office of Registered: /S/ Lauri Anderson 3/5/96
_______________________________
Lauri Andersen Date
SEVENTH: (a) The corporation may indemnify any person who was or is a party or
is threatened to be made a party to any threatened, pending, or completed
action, suit, or 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 he is or was a director, officer, employee, fiduciary or
agent of the corporation or is or was serving at the request of the corporation
as a director, officer, employee, fiduciary or agent of another corporation,
partnership, joint venture, trust, or other enterprise, against expenses
(including attorney fees), judgments, fines, and amounts paid in settlement
actually and reasonably believed to be in the best interests of the corporation
and, with respect to any criminal action or proceeding, had no reasonable cause
to believe his conduct was unlawful. The termination of any action, suit, or
proceeding by judgment order, settlement, or conviction or upon a pleas 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 he reasonably believed to
be in the best interests of the corporation and, with respect to any criminal
action or proceeding, had reasonable cause to believe his conduct was unlawful.
(b) The corporation may 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 its favor
by reason of the fact that he is or was a director, officer, employee, or agent
of the corporation or is or was serving at the request of the corporation as a
director, officer, employee, fiduciary or agent of another corporation,
partnership, joint venture, trust or other enterprise against expenses
(including attorney fees) actually and reasonably incurred by him in connection
with the defense or settlement of such action or suit if he acted in good faith
and in a manner he reasonably believed to be in the best interests of the
corporation; but no indemnification shall be made in respect of any claim,
issue, or matter as to which such person has been adjudged to be liable for
negligence or
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misconduct in the performance of his duty to the corporation unless and only to
the extent that the court in which such action or suit was brought determines
upon application that, despite the adjudication of liability, but in view of all
circumstances of the case, such person is fairly and reasonably entitled to
indemnification for such expenses which such court deems proper.
(c) To the extent that a director, officer, employee fiduciary or
agent of a corporation has been successful on the merits in defense of any
action, suit, or proceeding referred to in (a) or (b) of this Article VII or in
defense of any claim, issue, or matter therein, he shall be indemnified against
expenses (including attorney fees) actually and reasonably incurred by him in
connection therewith.
(d) Any indemnification under (a) or (b) of this Article VII (unless
ordered by a court) and as distinguished from (c) of this article shall be made
by the corporation only as authorized in the specific case upon a determination
that indemnification of the director, officer, employee, fiduciary or agent is
proper in the circumstances because he has met the applicable standard of
conduct set forth in (a) or (b) above. Such determination shall be made by the
board of directors by a majority vote of a quorum consisting of directors who
were not parties to such action, suit, or proceeding, or, if such a quorum is
not obtainable, or, even if obtainable, if a quorum of disinterested directors
so directs.
(e) Expenses (including attorney's fees) incurred in defending a
civil or criminal action, suit or proceeding may be paid by the corporation in
advance of the final disposition of such action, suit or proceeding as
authorized in Section (d) of this Article, upon receipt of an undertaking by or
on behalf of the director, officer, employee or agent to repay such amount,
unless it shall ultimately be determined that he is entitled to be indemnified
by the corporation as authorized in this Article.
(f) The board of directors may exercise the corporation's power to
purchase and maintain insurance on behalf of any person who is or was a
director, officer, employee or agent of the corporation, or is or was serving at
the request of the corporation as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other enterprise,
against any liability asserted against him and incurred by him in any such
capacity, or arising out of his status as such, whether or not the corporation
would have the power to indemnify him against such liability under this Article.
(g) The indemnification provided by this Article shall not be deemed
exclusive of any other rights to which those seeking indemnification may be
entitled under these Articles of Incorporation, the Bylaws, agreements, vote of
the shareholders or disinterested directors, or otherwise, both as to action in
his official capacity and as to action in another capacity while holding such
office, and shall continue as to a person who has ceased to be a director,
officer, employee or agent and shall inure to the benefit of the heirs and
personal representatives of such a person.
EIGITH: The following provisions are inserted for the management of the business
and for the conduct of the affairs of the corporation and the same are in
furtherance of and not in limitation of the powers, conferred by law:
No contract or other transaction between this corporation and one or
more of its directors, officers, or stockholders or between this corporation and
any other corporation, firm or association in which one or more of its officers,
directors, or stockholders are officers, directors or stockholders shall be
either
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void or voidable (1) if at a meeting of the board of directors or
committee authorizing or ratifying the contract or transaction there is a quorum
of persons not so interested in the contract or other transaction is approved by
a majority of such quorum or (2) if the contract or other transaction is
ratified at an annual or special meeting of stockholders, or (3) if the contract
or other transaction is just and reasonable to the corporation of the time it is
made, authorized or ratified.
NINTH: The name and address of the incorporators is:
Richard V. Murray 3748 Divisadero, San Francisco, CA 94123
v
Larry R. Walker 195 Alhambra #3 San Francisco, CA 94123
Dated this 5 Day of March, 1996
/s/ Richard V. Murray /s/ Larry R. Walker
________________________ ________________________
Richard V. Murray Larry R. Walker
BYLAWS
OF
MARINA CAPITAL, INC.
ARTICLE I
Offices
1. Business Offices. The principal office of the Corporation shall be
located at 3748 Divisidero Street, San Francisco, CA 94123, and the Corporation
may have one or more offices at such place or places within or without the
States of Utah as the Board of Directors may from time to time determine or as
the business of the Corporation may require.
2. Registered Office. The registered office of the Corporation shall be as
set forth in the Articles of Incorporation, unless changed as provided by the
Utah Corporation Code.
ARTICLE II
Stockholders' Meetings
1. Annual Meetings. The annual meetings of stockholders for the election of
directors to succeed those whose terms expire and for the transaction of such
other business as may come before the meeting shall be held within six (6)
months after the close of the fiscal year of the Corporation, for the purposes
of electing directors, and transacting such other business as may properly come
before the meeting.
2. Special Meetings. Special meetings of stockholders for any purpose or
purposes, unless otherwise prescribed by statute or by the Articles of
Incorporation, may be called at any time by the President or by the Board of
Directors and shall be called by the President or Secretary upon the request
(which shall state the purpose or purposes therefor) of a majority of the Board
of Directors or of the holders of not less than ten per cent (10%) of the number
of shares of outstanding stock of the Corporation entitled to vote at the
meeting. Business transacted at any special meeting of stockholders shall be
limited to the purpose or purposes stated in the notice.
3. Place of Meetings. Meetings of stockholders shall be held at such place
or places as may be designated from time to time by the Board of Directors.
4. Notice of Meetings. Except as otherwise provided by statute, notice of
each meeting of stockholders, whether annual or special, shall be given not less
than ten (10) nor more than sixty (60) days prior
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thereto to each shareholder entitled to vote there at by delivering written or
printed notice thereof to such shareholder personally or by depositing the same
in the United States mail, postage prepaid, directed to the shareholder at his
address as it appears on the stock transfer books of the Corporation; provided,
however, that if the authorized shares of the Corporation are proposed to be
increased, at least thirty (30) days notice in like manner shall be given. The
notice of all meetings shall state the place, day and hour thereof. The notice
of a special meeting shall, in addition, state the purposes thereof.
(a) Notice of any meeting need not be given to any person who may
become a stockholder of record after the mailing of such notice and prior to the
meeting, or to any stockholder who attends such meeting, in person or by proxy,
or signed waiver of notice either before or after such meeting. Notice of any
adjourned meeting of stockholders need not be given, unless otherwise required
by statute.
5. Voting List. At least ten (10) days before every meeting of
stockholders, a complete list of the shareholders entitled to vote there at or
any adjournment thereof, arranged in alphabetical order, showing the address of
each shareholder and the number of shares registered in the name of each, shall
be prepared by the officer or agent of the Corporation who has charge of the
stock transfer books of the Corporation. Such list shall be open at the
principal office of the Corporation to the inspection of any shareholder during
usual business hours for a period of at least ten (10) days prior to such
meeting. Such list shall also be produced and kept at the time and place of the
meeting during the whole time thereof and subject to the inspection of any
shareholder who may be present.
6. Organization. The President or Vice President shall call meetings of
stockholders to order and act as chairman of such meetings. In the absence of
said officers, any shareholder entitled to vote thereat, or any proxy of any
such shareholder, may call the meetings to order and a chairman shall be elected
by a majority of the stockholders entitled to vote thereat. In the absence of
the Secretary and Assistant Secretary of the Corporation, any person appointed
by the chairman shall act as secretary of such meetings.
7. Agenda and Procedure. The Board of Directors shall have the
responsibility of establishing an agenda for each meeting of stockholders,
subject to the rights of stockholders to raise matters for consideration which
may otherwise properly be brought before the meeting although not included
within the agenda. The chairman shall be charged with the orderly conduct of all
meetings of stockholders; provided, however, that in the event of any difference
in opinion with respect to the proper course of action which cannot be resolved
by reference to statute, the Articles of Incorporation or these Bylaws, Robert's
Rule of Order (as last revised) shall govern the disposition of the matter.
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8. Quorum. (a) Except as otherwise provided herein, or by statute, or in
the Certificate of Incorporation (such certificate and any amendments thereof
being hereinafter collectively referred to as the "Certificate of
Incorporation"), at all meetings of stockholders of the Corporation, the
presence at the meetings of stockholders of the Corporation, presence at the
commencement of such meetings in person or by proxy of stockholders holding of
record a majority of the total number of shares of the Corporation then issued
and outstanding and entitled to vote, shall be necessary and sufficient to
constitute a quorum for the transaction of any business. The withdrawal of any
stockholder after the commencement of a meeting shall have no effect on the
existence of a quorum, after a quorum has been established at such meeting.
(b) Despite the absence of a quorum at any annual or special meeting of
stockholders, the stockholders, by a majority of the votes cast by the holders
of shares entitled to vote thereat, may adjourn the meeting.
9. Adjournment. When a meeting is for any reason adjourned to another time
or place, notice need not be given of the adjourned meeting if the time and
place thereof are announced at the meeting at which the adjournment is taken.
At the adjourned meeting any business may be transacted which might have been
transacted at the original meeting.
10. Voting. (a) Each shareholder shall at every meeting of stockholders, or
with respect to corporate action which may be taken without a meeting, be
entitled to one vote for each share of stock having voting power held of record
by such shareholder on the record date designated therefor pursuant to section 3
of Article XI of these Bylaws (or the record date established pursuant to
statute in the absence of such designation); provided that the cumulative system
of voting for the election of directors or for any other purpose shall not be
allowed.
(b) Each shareholder so entitled to vote at a meeting of stockholders,
or to express consent or dissent to corporate action in writing without a
meeting, may vote or express such consent or dissent in person or may authorize
another person or persons to vote or act for him by proxy executed in writing by
such shareholder (or by his duly authorized attorney in fact) and delivered to
the secretary of the meeting (or if there is no meeting to the Secretary of the
Corporation); provided that no such proxy shall be voted or acted upon after
eleven (11) months from the date of its execution, unless such proxy expressly
provides for a longer period.
(c) When a quorum is present at any meeting of stockholders, the vote
of the holders of a majority of the shares of stock having voting power present
in person or represented by proxy shall decide any question brought before such
meeting, unless the question is
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one upon which by express provision of a statute, or the Articles of
Incorporation, or these Bylaws, a different vote is required, in which case such
express provision shall govern and control the decision on such question.
11. Inspectors. The chairman of the meeting may at any time appoint two (2)
or more inspectors to serve at a meeting of the stockholders. Such inspectors
shall decide upon the qualifications of voters, including the validity of
proxies, accept and count the votes for and against the questions presented,
report the results of such votes, and subscribe and deliver to the secretary of
the meeting a certificate stating the number of shares of stock issued and
outstanding and entitled to vote thereon and the number of shares voted for and
against the questions presented. The inspectors need not be stockholders of the
Corporation, and any director or officer of the Corporation may be an inspector
on any question other than a vote for or against his election to any position
with the Corporation or on any other question in which he may be directly
interested.
ARTICLE III
Board of Directors
1. Election and Tenure. The business and affairs of the Corporation shall
be managed by a Board of Directors who shall be elected at the annual meetings
of stockholders by plurality vote. Each director shall be elected to serve and
to hold office until the next succeeding annual meeting and until his successor
shall be elected and shall qualify, or until his earlier death, resignation or
removal.
2. Number and Qualification. The Board of Directors shall consist of not
less than two nor more than fifteen members, unless and until otherwise
determined by vote of a majority of the entire Board of Directors. The number
of Directors shall not be less than two (2), unless all of the outstanding
shares of stock are owned beneficially and of record by less than two (2)
stockholders, in which event the number of directors shall not be less than the
number of stockholders or the minimum permitted by statute.
3. Organization Meetings. As soon as practicable after each annual election
of directors, the Board of Directors shall meet for the purpose of organization,
selection of a Chairman of the Board, election of officers and the transaction
of any other business.
4. Regular Meetings. Regular meetings of the Board of Directors shall be
held at such time or times as may be determined by the Board of Directors and
specified in the notice of such meeting.
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5. Special Meetings. Special meetings of the Board of Directors may be
called by the Chairman of the Board or the President and shall be called by the
President or Secretary on the written request of any two (2) directors.
6. Place of Meetings. Any meeting of the Board of Directors may be held at
such place or places as shall from time to time be determined by the Board of
Directors or fixed by the Chairman of the Board and as shall be designated in
the notice of the meeting.
7. Notice of Meeting. Notice of each meeting of directors, whether
organizational, regular or special, shall be given to each director. If such
notice is given either (a) by delivering written or printed notice of a director
personally or (b) by telephone personally to such director, it shall be so given
at least two (2) days prior to the meeting. If such notice is given either (a)
by depositing a written or printed notice in the United States mail, postage
prepaid, or (b) by transmitting a cable or telegram, in all cases directed to
such director at his residence or place of business, it shall be so given at
least four (4) days prior to the meeting. The notice of all meetings shall
state the place, date and hour thereof, but need not, unless otherwise required
by statute, state the purpose or purposes thereof.
8. Election. Except as may otherwise be provided herein or in the
Certificate of Incorporation by way of cumulative voting rights the members of
the Board of Directors of the Corporation, who need not be stockholders, shall
be elected by a majority of the votes cast at a meeting of stockholders, by the
holders of shares of stock present in person or by proxy, entitled to vote in
the election.
9. Quorum. A majority of the number of directors fixed by paragraph 2 of
this Article III shall constitute a quorum at all meetings of the Board of
Directors, and the vote of a majority of the directors present at a meeting at
which a quorum is present shall be the act of the Board of Directors. In the
absence of a quorum at any such meeting, a majority of the directors present may
adjourn the meeting from time to time without further notice, other than
announcement at the meeting, until a quorum shall be present.
10. Organization Agenda and Procedure. The Chairman of the Board or in his
absence any director chosen by a majority of the directors present shall act as
chairman of the meetings of the Board of Directors. In the absence of the
Secretary and Assistant Secretary, any person appointed by the chairman shall
act as secretary of such meetings. The agenda of and procedure for such meetings
shall be as determined by the Board of Directors.
11. Resignation. Any director of the Corporation may resign at any time by
giving written notice of his resignation to the Board of Directors,
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to the Chairman of the Board, the President, any Vice President or the Secretary
of the Corporation. Such resignation shall take effect at the date of receipt
of such notice or at any later time specified therein and, unless otherwise
specified therein, the acceptance of such resignation shall not be necessary to
make it effective.
12. Removal. Except as otherwise provided in the Articles of Incorporation
or In these Bylaws, any director may be removed, either with or without cause,
at any time, by the affirmative vote of the holders of a majority of the issued
and outstanding shares of stock entitled to vote for the election of directors
of the Corporation given at a special meeting of the stockholders called and
held for such purpose. The vacancy in the Board of Directors caused by any such
removal may be filled by such stockholders at such meeting or, if the
stockholders at such meeting shall fail to fill such vacancy, by the Board of
Directors as provided in paragraph 12 of this Article III.
13. Vacancies. Except as provided in paragraph 11 of this Article III, any
vacancy occurring for any reason in the Board of Directors may be filled by the
affirmative vote of a majority of the directors then in office, though less than
a quorum of the Board of Directors. Any directorship to be filled by the
affirmative vote of a majority of the directors then in office or by an election
at an annual meeting or at a special meeting of stockholders called for that
purpose. A director elected to fill a vacancy shall be elected for the
unexpired term of his predecessor in office and shall hold office until the
expiration of such term and until his successor shall be elected and shall
qualify or until his earlier death, resignation or removal. A director chosen
to fill a position resulting from an increase in the number of directors shall
hold office until the next annual meeting of stockholders and until his
successor shall be elected and shall qualify, or until his earlier death,
resignation or removal.
14. Executive Committee. The Board of Directors, by resolution adopted by a
majority of the number of directors fixed by paragraph 2 of this Article III,
may designate two (2) or more directors to constitute an executive committee,
which committee, to the extent provided in such resolution, shall have and may
exercise all of the authority of the Board of Directors in the management of the
Corporation.
15. Compensation of Directors. Each director may be allowed such amount per
annum or such fixed sum for attendance at each meeting of the Board of Directors
or any meeting of an executive committee, or both, as may be from time to time
fixed by resolution of the Board of Directors, together with reimbursement for
the reasonable and necessary expenses incurred by such director in connection
with the performance of his duties. Nothing herein contained shall be construed
to preclude any director from serving the Corporation or any of its subsidiaries
in any other capacity and receiving proper compensation therefor.
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16. Duties and Powers. The Board of Directors shall be responsible for the
control and management of the affairs, property and interests of the Corporation
and may exercise all powers of the Corporation, except as are in the Certificate
of Incorporation or by statute expressly conferred upon or reserved to the
stockholders.
ARTICLE IV
Waiver of Notice and Action by Consent
1. Waiver of Notice. Whenever any notice whatever is required to be given
under the provisions of a statute or of the Articles of Incorporation, or by
these Bylaws, a waiver thereof either in writing signed by the person entitled
to said notice (or such person's agent or attorney in fact thereunto authorized)
or by telegraph, cable or any other available method, whether before, at or
after the time stated therein, or the appearance of such person or persons at
such meeting in person or by proxy (except for the sole purpose of challenging
the propriety of the meeting), shall be deemed equivalent to such notice.
2. Action Without a Meeting Any action required or which may be taken at a
meeting of the directors, stockholders or members of any executive committee of
the Corporation, may be taken without a meeting if a consent in writing, setting
forth the action so taken, shall be signed by all of the directors,
stockholders, or members of the executive committee, as the case may be,
entitled to vote with respect to the subject matter thereof.
ARTICLE V
Officers
1. Election and Tenure. The Board of Directors annually shall elect a
President, a Secretary, and a Treasurer. The Board of Directors may also elect
or appoint such Vice Presidents, other officers and assistant officers as may be
determined by the Board of Directors. The Board of Directors may delegate to
any such officer the power to appoint or remove subordinate officers, agents, or
employees. Any two or more offices may be held by the same person, except the
offices of President and Secretary. Each officers so elected or appointed shall
continue in office until his successor shall be elected or appointed and shall
qualify, or until his earlier death, resignation or removal.
2. Resignation, Removal And Vacancies. Any officer may resign at any time
by giving written notice thereof to the Board of Directors or to the President.
Such resignation shall take effect on the date specified therein and no
acceptance of the same shall be necessary to render the same effective. Any
officer may at any time be removed by the
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affirmative vote of a majority of the number of directors specified in section 2
of Article III of these Bylaws, or by an executive committee thereunto duly
authorized. If any office becomes vacant for any reason, the vacancy may be
filled by the Board of Directors. An Officer appointed to fill a vacancy shall
be appointed for the unexpired term of his predecessor in office an shall
continue in office until his successor shall be elected or appointed and shall
qualify, or until his earlier death, resignation or removal.
3. President. The President shall be the chief executive officer of the
Corporation. He shall preside at all meetings of the stockholders and shall
have general and active management of the business of the Corporation. He shall
see that all orders and resolutions of the Board of Directors are carried into
effect and in general shall perform all duties as may from time to time be
assigned to him by the Board of Directors.
4. Vice President. The Vice President shall perform such duties and possess
such powers as from time to time may be assigned to them by the Board of
Directors or by the President. In the absence of the President or in the event
of his inability or refusal to act, the vice president (or in the event there be
more than one vice president, the vice presidents in the order designated, or in
the absence of any designation, then in the order of their election or
appointment) shall perform the duties of the President and when so performing
shall have all the powers of and be subject to all the restrictions upon the
President.
5. Secretary. The Secretary shall perform such duties and shall have such
powers as may from time to time be assigned to him by the Board of Directors or
the President. In addition, the Secretary shall perform such duties and have
such powers as are incident to the officer of Secretary, including without
limitation the duty and power to give notice of all meetings of stockholders and
the Board of Directors, to attend such meetings and keep a record of the
proceedings, and to be custodian of corporate records and the corporate seal and
to affix and attest to the same on documents, the execution of which on behalf
of the Corporation is authorized by these Bylaws or by the action of the Board
of Directors.
6. Treasurer. The Treasurer shall perform such duties and shall have such
powers as may from time to time be assigned to him by the Board of Directors or
the President. In addition, the Treasurer shall perform such duties and have
such powers as are incident to the office of Treasurer, including without
limitation the duty and power to keep and be responsible for all funds and
securities of the Corporation, to deposit funds of the Corporation in
depositories selected in accordance with these Bylaws, disburse such funds as
ordered by the Board of Directors, making proper accounts thereof, and shall
render as required by the Board of Directors statements of all such transactions
as Treasurer and of the financial condition of the Corporation.
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7. Assistant Secretaries. The Assistant Secretaries shall perform such
duties and possess such powers as from time to time shall be assigned to them by
the Board of Directors, the President, or the Secretary. In the absence,
inability or refusal to act of the Secretary, the Assistant Secretaries in the
order determined by the Board of Directors shall perform the duties and exercise
the powers of the Secretary.
8. Assistant Treasurers. The Assistant Treasurers shall perform such duties
and possess such powers as from time to time shall be assigned to them by the
Board of Directors, the President, or the Treasurer. In the absence, inability
or refusal to act of the Treasurer, the Assistant Treasurers in the order
determined by the Board of Directors shall perform the duties and exercise the
powers of the Treasurer.
9. Bond of Officers. The Board of Directors may require any officer to give
the Corporation a bond in such sum and with such surety or sureties as shall be
satisfactory to the Board of Directors for such terms and conditions as the
Board of Directors may specify, including without limitation for the faithful
performance of his duties and for the restoration to the Corporation of all
property in his possession or under his belonging to the Corporation.
10. Salaries. Officers of the Corporation shall be entitled to such
salaries, emoluments, compensation or reimbursement as shall be fixed or allowed
from time to time by the Board of Directors.
ARTICLE VI
Indemnification
1. Third party actions. 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, suit or 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 he is or was a director, officer, employee or agent of
the Corporation, or is or was serving at the request of the Corporation as a
director, officer, employee or agent of another Corporation, partnership, joint
venture, trust or other enterprise, against expenses (including attorneys'
fees), judgments, fines and amounts paid in settlement actually and reasonably
incurred by him in connection with such action, suit or proceeding if he acted
in good faith and in a manner he 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 his 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 he
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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
reasonable cause to believe that his conduct was unlawful.
2. Derivative actions. 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 its favor by reason of the fact that he is or was a director,
officer, employee or agent of the Corporation, or is or was serving at the
request of the Corporation as a director, officer, employee or agent of another
Corporation, partnership, joint venture, trust, or other enterprise against
expenses (including attorneys' fees) actually and reasonably incurred by him in
connection with the defense or settlement of such action or suit if he acted in
good faith and in a manner he reasonably believed to be in or not opposed to the
best interests of the Corporation, except that no indemnification shall be made
in respect of any claim, issue, or matter as to which such person shall have
been adjudged to be liable for negligence or misconduct in the performance of
his 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 the adjudication of liability and in view of all the circumstances of
the case, such person is fairly and reasonably entitled to indemnity for such
expenses which such court shall deem proper.
3. Extent of indemnifications. To the extent that a director, officer,
employee or agent of the Corporation has been successful on the merits or
otherwise in defense of any action, suit or proceeding referred to in sections 1
and 2 of this Article VI, or in defense of any claim, issue or matter therein,
he shall be indemnified against expenses (including attorneys' fees) actually
and reasonably incurred by him in connection therewith.
4. Determination. Any indemnification under sections 1 and 2 of this
Article VI (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
officer, director and employee or agent is proper in the circumstances because
he has met the applicable standard of conduct set forth in sections 1 and 2 of
this Article VI. Such determination shall be made (a) by the Board of Directors
by a majority vote of a quorum consisting of directors who were not parties to
such action, suitor proceeding, or (b) if such a quorum is not obtainable, or,
even if obtainable, a quorum of disinterested directors so directs, by
independent legal counsel in a written opinion, or (c) by the affirmative vote
of the holders of a majority of the shares of stock entitled to vote and
represented at a meeting called for such purpose.
5. Payment in advance. Expenses incurred in defending a civil or criminal
action, suit or proceeding may be paid by the Corporation in
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advance of the final disposition of such action, suit or proceeding as
authorized by the Board of Directors as provided in Section 4 of this Article VI
upon receipt of an undertaking by or on behalf of the director, officer,
employee or agent to repay such amount unless it shall ultimately be determined
that he is entitled to be indemnified by the Corporation as authorized in this
Article VI.
6. Insurance The Board of Directors may exercise the Corporation's power
to purchase and maintain insurance on behalf of any person who is or was a
director, officer, employee or agent of the corporation, or is or was serving at
the request of the Corporation as a director, officer, employee or agent of
another Corporation, partnership, joint venture, trust or other enterprise
against any liability asserted against him and incurred by him in any such
capacity, or arising out of his status as such, whether or not the Corporation
would have the power to indemnify him against such liability hereunder or
otherwise.
7. Other Coverage. The indemnification provided by this Article VI shall
not be deemed exclusive of any other rights to which those seeking
indemnification may be entitled under the Articles of Incorporation, these
Bylaws, agreement, vote of stockholders or disinterested directors, the Utah
Corporation Code, or otherwise, both as to action in his official capacity and
as to action in another capacity while holding such office, and shall continue
as to a person who has ceased to be a director, officer, employee or agent and
shall inure to the benefit of the heirs and personal representatives of such a
person.
ARTICLE VII
Execution of Instruments; Loans; Checks
and Endorsements; Deposits; Proxies
1. Execution of Instruments. The President or any Vice President shall have
power to execute and deliver on behalf and in the name of the Corporation any
instrument requiring the signature of an officer of the Corporation, except as
otherwise provided in these Bylaws or where the execution and delivery thereof
shall be expressly delegated by the Board of Directors to some other officer or
agent of the Corporation. Unless authorized so to do by these Bylaws or by the
Board of Directors, no officer, agent or employee shall have any power or
authority to bind the Corporation in any way, to pledge its credit or to render
it liable pecuniarily for any purpose or in any amount.
2. Loans. No loan shall be contracted on behalf of the Corporation, and no
evidence of indebtedness shall be issued, endorsed or accepted in its name,
unless authorized by the Board of Directors or a standing committee designated
by the Board of Directors so to act. Such authority may be general or confined
to specific instances. When so authorized, the officer or officers thereunto
authorized may effect loans
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at any time for the Corporation from any bank or other entity and for such loans
may execute and deliver promissory notes or other evidences of indebtedness of
the Corporation, and when authorized as aforesaid, as security for the payment
of any and all loans (and any obligations incident thereto) of the Corporation,
may mortgage, pledge, or otherwise encumber any real or personal property, or
any interest therein, at any time owned or held by the Corporation, and to that
end may execute and deliver such instruments as may be necessary or proper in
the premises.
3. Checks and Endorsements. All checks, drafts or other orders for the
payment of money, obligations, notes or other evidences of indebtedness, bills
of lading, warehouse receipts, trade acceptances, and other such instruments
shall be signed or endorsed by such officers or agents of the Corporation as
shall from time to time be determined by resolution of the Board of Directors,
which resolution may provide for the use of facsimile
signatures.
4. Deposits. All funds of the Corporation not otherwise employed shall be
deposited from time to time to the Corporation's credit in such banks or other
depositories as shall from time to time be determined by resolution of the Board
of Directors, which resolution may specify the officers or agents of the
Corporation who shall have the power, and the manner in which such power shall
be exercised, to make such deposits and to endorse, assign and deliver for
collection and deposit checks, drafts and other orders for the payment of money
payable to the Corporation or its order.
5. Proxies. Unless otherwise provided by resolution adopted by the Board of
Directors, the President or any Vice President may from time to time appoint one
or more agents or attorneys in fact of the Corporation, in the name and on
behalf of the Corporation, to cast the votes which the Corporation maybe
entitled to cast as the holder of stock or other securities in any other
Corporation, association or other entity any of whose stock or other securities
may be held by the Corporation, at meetings of the holders of the stock or other
securities of such other Corporation, association or other entity, or to consent
in writing, in the name of the Corporation as such holder, to any action by such
other Corporation, association or other entity, and may instruct the person or
persons so appointed as to the manner of casting such votes or giving such
consent, and may execute or cause to be executed in the name and on behalf of
the Corporation and under its corporate seal, or otherwise, all such written
proxies or other instruments as he may deem necessary or proper in the premises.
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ARTICLE VIII
Shares of Stock
1. Certificates of Stock. Every holder of stock of the Corporation shall be
entitled to have a certificate certifying the number of shares owned by him in
the Corporation and designating the class of stock to which such shares belong,
which shall otherwise be in such form as is required by law and as the Board of
Directors shall prescribe. Each such certificate shall be signed by the
President or a Vice President and the Treasurer or any Assistant Treasurer or
the Secretary or any Assistant Secretary of the Corporation; provided, however,
that where such certificate is signed or countersigned by a transfer agent or
registrar (other than the Corporation or any employee of the Corporation) the
signatures of such officers of the Corporation may be in facsimile form. In case
any officer of the Corporation who shall have signed, or whose facsimile
signature shall have been placed on, any certificate shall cease for any reason
to be such officer before such certificate shall have been Issued or delivered
by the Corporation, such certificate may nevertheless be issued and delivered by
the Corporation as though the person who signed such certificate, or whose
facsimile signature shall have been placed thereon, had not ceased to be such
officer of the Corporation.
2. Record. A record shall be kept of the name of each person or other
entity holding the stock represented by each certificate for shares of the
Corporation issued, the number of shares represented by each such certificate,
and the date thereof, and, in the case of cancellation, the date of
cancellation. The person or other entity in whose name shares of stock stand on
the books of the Corporation shall be deemed the owner thereof, and thus a
holder of record of such shares of stock, for all purposes as regards the
Corporation.
3. Transfer of Stock. Transfers of shares of the stock of the Corporation
shall be made only on the books of the Corporation by the registered holder
thereof, or by his attorney thereunto authorized, and on the surrender of the
certificate or certificates for such shares properly endorsed.
4. Transfer Agents and Registrars: Regulations. The Board of Directors may
appoint one or more transfer agents or registrars with respect to shares of the
stock of the Corporation. The Board of Directors may make rules and regulations
as it may deem expedient, not inconsistent with these Bylaws, concerning the
issue, transfer and registration of certificates for shares of the stock of the
Corporation.
5. Lost, Destroyed or Mutilated Certificates. The holder of any certificate
representing shares of stock of the Corporation shall immediately notify the
Corporation of any loss or destruction of the certificate representing the same.
The Corporation may issue a new
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certificate in the place of any certificate previously issued by it, alleged to
have been lost or destroyed. On production of such evidence of loss or
destruction as the Board of Directors in its discretion may require, the owner
of the lost or destroyed certificate, or his legal representatives, to give the
Corporation a bond in such sum as the Board may direct, and with such surety or
sureties as may be satisfactory to the Board to indemnify the Corporation
against any claims, loss, liability or damage it may suffer on account of the
issuance of the new certificate. A new certificate may be issued without
requiring any such evidence or bond when, in the judgment of the Board of
Directors, it is proper to do so.
ARTICLE IX
Corporate Seal
1. Corporate Seal. The corporate seal shall be in such form, as shall be
approved by resolution of the Board of Directors. Said seal may be used by
causing it or a facsimile thereof to be impressed or affixed or in any other
manner reproduced. The impression of the seal may be made and attested by
either the Secretary or an Assistant Secretary for the authentication of
contracts or other papers requiring the seal.
ARTICLE X
Fiscal Year
1. Fiscal Year The fiscal year of the Corporation shall be such year as
shall be established by the Board of Directors.
ARTICLE XI
Corporate Books and Records
1. Corporate Books. The books and records of the Corporation may be kept
within or without the State of Utah at such place or places as may be from time
to time designated by the Board of Directors.
2. Addresses of Stockholders. Each shareholder shall furnish to the
Secretary of the Corporation or the Corporation's transfer agent an address to
which notices from the Corporation, including notices of meetings, may be
directed and if any shareholder shall fail so to designate such an address, it
shall be sufficient for any such notice to be directed to such shareholder at
his address last known to the Secretary of transfer agent.
3. Record Date. In lieu of closing the stock ledger of the Corporation,
the Board of Directors may fix, in advance, a date not exceeding sixty (60)
days, nor less than ten (10) days, as the record date for the determination of
stockholders entitled to receive notice of, or to
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vote at, any meeting of stockholders, or to consent to any proposal without a
meeting, or for the purposes of determining stockholders entitled to received
payment of any dividends or allotment of any rights, or for the purpose of any
other action. If no record date is fixed, the record date for the determination
of stockholders entitled to notice of or to vote at a meeting of stockholders
shall be at the close of business on the day next preceding the day on which
notice is given, or, if no notice is given, the day preceding the day on which
the meeting is held; the record date for determining stockholders for any other
purpose shall be at the close of business on the day on which the resolution of
the directors relating thereto is adopted. When a determination of stockholders
of record entitled to notice of or to vote at any meeting of stockholders has
been made as provided for herein, such determination shall apply to any
adjournment thereof, unless the directors fix a new record date for the
adjourned meeting.
4. Audits of Books and Accounts. The Corporation's books and accounts shall
be audited at such times and by such auditors as shall be specified and
designated by resolution of the Board of Directors.
ARTICLE XII
Emergency Bylaws
1. Emergency Bylaws The Board of Directors may adopt emergency Bylaws in
accordance with and pursuant to the provisions therefor from time to time set
forth in the Utah Corporation Code.
ARTICLE XIII
Amendments
1. Amendments. All Bylaws of the Corporation shall be subject to
alteration, amendment or repeal, and new bylaws may be added, by the affirmative
vote of a majority of a quorum of the members of the Board of Directors at any
regular or special meeting.
15
Form of stock certificate
Number Shares
INCORPORATED UNDER THE LAWS OF THE STATE OF UTAH
MARINA CAPITAL, INCORORATED
The Corporation is authorized to issue 30,00,000 Common Shares
Par Value $.001 each
The shares represented by this certificate have not been registered under any
federal or state securities law. they have been acquired for investment and may
not be transferred without an effective registration statement pursuant to such
laws or an opinion of legal counsel satisfactory to the Corporation that
registration is not required.
This Certifies that (Name) is the owner of (amount) fully paid and non-
assessable Shares of the above Corporation transferable only on the books of the
Corporation by the holder hereof in person or by duly authorized Attorney upon
surrender of this Certificate properly endorsed.
In Witness Whereof, the said Corporation has caused this Certificate to be
signed by its duly authorized officers and to be sealed with the Seal of the
Corporation.
Dated
/s/ /s/
Secretary Treasurer Seal President
EMPLOYMENT AGREEMENT
THIS AGREEMENT ("the Agreement")
made this first day of April 1999 by and between:
Marina Capital, Inc.,
a Utah Corporation
(hereinafter referred to as "Employer")
and
Larry R. Walker, an individual
(hereinafter referred to as "Employee")
WITNESSETH
WHEREAS, Employer is desirous of employing the Employee as the President and
Chief Executive Officer of Marina Capital, Inc.; and
WHEREAS, Employee is desirous of being employed by Employer as the President and
Chief Executive Officer of Marina Capital, Inc.; and
WHEREAS, Employer and Employee have negotiated the terms of this Agreement over
the past several weeks.
NOW, THEREFORE, in consideration of the premises and covenants and Agreements
contained herein, the parties agree as follows:
1. Employment. Employer hereby employs, engages, and hires Employee as the
President and Chief Executive Officer, and Employee hereby accepts and agrees to
such hiring, engagement and employment. Employee shall in general supervise and
control all of the operations of the Employer, including hiring and negotiating
Employee, Consulting, and Contractor agreements. He shall, when present, attend
and may preside at all meetings of the shareholders and the Board of Directors.
In general, shall perform all duties relating to the business and operations as
may be prescribed by the Board of Directors, from time to time.
2. Best Efforts of Employee. Employee agrees that he will, at all times
faithfully, industriously, and to the best of his ability, experience, and
talents, perform all of the duties that may be required of and from him pursuant
to the express and implicit terms hereof, to the reasonable satisfaction of
Employer. Such duties shall be rendered in the continental United States, its
Territories, and at such other place or places as the Employer shall in good
faith require of as the interest, needs, business or opportunity may require.
3. Term of Employment. The term of this Agreement shall be for a period of seven
(7) years commencing on November 1, 1996, and terminating October 31, 2003,
subject, however, to prior termination as hereinafter provided. On the
expiration date of this Agreement on October 31, 2003, this Agreement shall be
considered renewed for regular periods of one (1) year or such other period of
time as the parties may agree to, provided neither party submits a notice of
termination.
4. Compensations of Employee. Employer shall pay Employee, and Employee shall
accept from Employer, in full payment for Employee's service hereunder,
compensation at the rate of seventy-five Thousand Dollars ($75,000), in U.S.
Currency, per annum, payable in sums of Six Thousand Two Hundred Fifty Dollars
($6,250) once per month on the first day of each month. The first payment of
Six Thousand Two Hundred Fifty Dollars ($6,250), less Federal, State, Social
Security and other local taxes will be due and payable to Employee on December
1, 1996. The Employer and the Employee on December 1, 1996. The Employer and
the Employee agree that the initial compensation paid by this Agreement is a
minimum rate of payment, which may be increased on the anniversary date by the
Board of Directors.
4.1 Nothing herein shall be construed to prevent the Employer from
increasing the
$75,000 per year base salary hereunder during the term of this Agreement, at the
discretion of the Board of Directors.
5. Additional Compensation. The Employer proposes to establish an
additional compensation pool out of the Employer's yearly net profits. The pool
will be made up of a minimum of two hundred thousand dollars ($200,000) or ten
percent (10%) of the Employer's yearly net profits, before taxes, which ever is
greater. The Company will pay Employee three percent (3%) of the Moines or
amount in the pool at the end of the first quarter after the close of Employer's
books on an annual basis. The pool will be established only out of the available
revenues that will not put the Company's liquidity in jeopardy.
5.1. The Board of Directors will review the status of the pool on an annual
basis and make any necessary adjustments, at its sole discretion.
5.2. Employee shall also receive Fifty percent (50%) of all real estate
listings and sales commissions Employee has earned, after deducting employees
monthly salary.
6. Right to Purchase Common Stock. The Employee shall have the right to
purchase common stock of the Employer under the following formula; Each year
within the first sixty (60) days of the anniversary date, starting in 1997,
Employee may purchase up to an amount of stock equal to 5% of the then issued
and outstanding common shares at a price equal to 75% of the book.
7. Other Employment. Employee shall devote all of his time, attention,
knowledge, and skills solely to the business and interest of Employer, and
Employer shall be entitled to all of the benefits, profits or other issues
arising from or incident to all work, services and advice of Employee. Employee
maybe permitted to be a partner, officer, director, or stockholder in any other
business, to the extent that the business in question does not create a conflict
of interest with Employer's business and does not detract from the time
necessary to carry on the duties of this Agreement.
8. Recommendations. For Improvement of Operations. Employee shall make
available to Employer all information of which Employee has any knowledge and
shall make all suggestions and recommendations that will be of material benefit
to Employer.
9. Trade Secrets. Employee shall not at any time or in any manner, either
directly or indirectly divulge, disclose or communicate to any person, firm or
Corporation in any manner whatsoever any information concerning any matters
affecting or relating to the business of Employer, including without limitation
to the generality of the foregoing, any of its customers, prices, it obtains or
has obtained from the sale of, or at which it sells or has sold, its properties,
services or any other information concerning the business of Employer, its
manner of operation, its plans, processes, or other data without regard to
whether all of the foregoing matters will be deemed confidential and affect the
effective and successful conduct of the business of Employer, and Employer's
good will, and that any breach of the terms of this paragraph may be considered
as breach of this Agreement.
10. Modification of Contract. No waiver or modification of this Agreement
or of any covenant, condition or limitation herein contained shall be valid
unless in writing and duly executed by the party to be charged therewith and no
evidence of any waiver or modification shall be offered or received in evidence
of any proceeding, arbitration, or litigation between the parties hereto arising
out of or affecting this Agreement, or the rights or obligations of the parties
hereunder, unless such waiver or modification is in writing, duly executed as
aforesaid, and the parties further agree that the provisions of this section may
not be modified except as herein set forth.
11. Agreement Outside of Contract. This contract contains the complete
Agreement concerning the employment Agreement between the parties and shall, as
of the effective date hereof, supersede all other Agreements between the
parties. the parties stipulate that neither of them have made any representation
with respect to the subject matter of this Agreement or any representations
including the execution and delivery hereof except such representations as are
specifically set forth herein and each of the parties hereof acknowledges that
he or it has relied on their own judgment in entering into this agreement.
12. Failure to Pay Employee. The failure of Employer to pay employee his
salary as provided in this Agreement may, in employee's sole discretion be
deemed a breach of this Agreement, and unless such breach is cured within ten
(10) days after written notice thereof to employer, this employment Agreement
shall terminate, including any non-competitive provisions.
13. Vacation and Holidays. Employee shall be entitled to a paid annual
vacation of thirty (30) days. In consultation with Employer, employee may
accumulate or carry forward to the next calendar year any vacation days as are
necessary under the circumstances. In addition, to Vacation, the employee shall
have the normal holidays, additional vacation days will be allowed if a vacation
day and a holiday fall on the same day.
14. Reimbursement for Expenses. Employer shall reimburse Employee for
reasonable out-of-pocket expenses which employee shall incur in connection with
his services for employer contemplated hereby on the presentation by Employee of
appropriate vouchers, receipts and contemporaneous notes therefor to Employer.
15. Traveling Expenses. Employer will pay Employee's airline fare, hotel,
and entertainment expenses, and other necessary and proper expenses when
traveling on Employer's business within our outside the Continental United
States.
16. Expenses for Promoting business of Employer. Employee is encouraged and
is expected, from time to time, to incur reasonable expenses for the promotion
of the business of the Employer, including expenses for home telephone;
automobile and other transportation, social, athletic and civic club memberships
for himself, family members and other necessary business associates
participation, entertainment, travel and similar items. The cost of these
business related expenses shall be borne by the Employer upon presentation to
the employer of itemized expenses receipts or contemporaneous memoranda of such
expenses.
17. Expenses for Attendance at Meeting and Seminars. employee is encouraged
and is expected at such time or times as employee may find necessary, to attend
seminars, professional meetings, conventions, and educational courses. the cost
of travel, registration, tuition, food, lodging for attending these activities
shall be paid by the Employer. Any other costs incurred by Employee in
connection with these activities shall be the expense of the Employee, unless,
there is mutual agreement with employer and it is determined that any additional
cost of Employee's attendance should be authorized as an expense of employer.
Should any such additional expenses of attendance be authorized, the Employee
shall be reimbursed therefor upon presenting to Employer an itemized receipt or
contemporaneous memoranda of such expenses.
18. Furnishing of Support. Employer shall furnish Employee the necessary
equipment, computer services, support personnel, experts, office space and any
other thing or personnel that may be necessary to perform his duties as Chief
Executive Officer. In addition, the employer shall furnish an automobile
parking space, personal financial counselor and attorney's services at
Employer's expense.
19. Fringe Benefits and Incentive Compensation Plans. employee shall be
entitled to participate with other officers of the Employer in all fringe
benefits or incentive compensation plans authorized and adopted from time to
time by Employer, including, without limitation; a pension plan, a profit
sharing plan, a medical reimbursement plan, a group life insurance plan, a
disability plan, etc.
20. Automobile Expenses. Employer will pay Employee $800 per month for the
use of Employee's automobile in the course of performing his Employer's
business, only.
21. Illness and Disability. employee shall be entitled to twenty (20) days
sick leave in each calendar year of employment or if he has not completed a
year, the number of days shall be calculated on a pro-rata basis if he is unable
to perform his duties by reason of illness or accident not resulting in Employee
becoming "totally disabled," without any adjustment in his compensation. Unused
sick leave may only be carried forward to the next calendar year with agreement
of Employer. If employee is unable to perform his duties by reason of total
disability, his salary may be reduced m accordance with the following schedule
during the continuance of such disability.
For six months he shall receive eighty percent (80%) of his monthly salary for
the next six months of disability, he shall receive seventy percent (70%) of his
monthly salary.
Thereafter, the Employer will have had in place a long term disability policy
which will guarantee fifty percent (50%) of the Employee's highest monthly
salary for the term of his disability in determining periods of disability any
new periods of disability, shall be deemed to be a continuation of the prior
period of disability if the Employee has not returned to work for at least one
(1) month between such periods of disability. If employee becomes disabled, but
the disability ceased before termination of his employment with Employer,
Employee's salary shall be reinstated on the date the disability ends.
22. Nonabatement of Salary in Event of Illness. It is understood and agreed
that the Employee shall not be considered as having breached this Agreement of
Employment in the event that he becomes unable to perform services for the
Employer because of sickness or disability, however, subject to paragraph 17,
and in the event Employee's salary shall not abate or in any other way be
curtailed.
23. Termination by Death. If the employee dies before his employment with
Employer is otherwise terminated, payments and/or benefits to which he would
then have been entitled to at the time of his death, shall be paid over to his
beneficiary and if no beneficiary survives him, the entire amount due him shall
be paid to his estate.
24. Payment of Professional Dues. Employer shall pay all dues of Employee
in any professional association to which the Employee may find it necessary to
belong in order to carry out his duties, and promote the business of Employer.
In addition, Employer will pay for the purchase of professional periodicals,
newspapers, and magazines which Employee may find necessary in order to carry
out his duties.
25. Medical & Life Insurance. Employer shall provide employee with a major
medical insurance policy. The cost of said policy shall be borne by Employer.
The medical insurance policy shall include but not be limited to dental care,
and psychiatric counseling. In addition there shall be no deductible as it
relates to the insurance policy. The Employer shall arrange and pay for the
medical insurance for the Employee's dependents. Employer shall also provide a
paid life insurance policy for Employee and spouse. The minimum benefit for the
beneficiary shall be not less than $250,000.
26. Deduction For Taxes. Employer shall deduct from the compensation
payable to Employee under all of the provisions of this employment Agreement,
social security taxes, and all federal, state and municipal taxes and charges as
now may be in effect or which may hereafter be enacted or required.
27. Performance and Termination - Employment Period. Subject, to the
performance of the covenants and agreement made by the employer herein, the
employee will perform his duties during the Employment Period in good faith and
will observe faithfully the covenants and agreements made by him herein. The
Employee shall not be discharged during the Employment Period except for
substantial and serious cause involving dishonesty or material breach of express
obligations of this Agreement within the control of the Employee. The discharge
of the Employee for reasons other than those specified in the preceding
sentence shall be of no force and effect. No breach or default by the employee
shall be deemed to have occurred thereunder unless written notice setting forth
with specificity the alleged incidents of default thereof shall have been given
by the Employer to the Employee and the Employee shall have failed to cure the
breach or default within sixty (60) days after he receives the written notice
If Employee has performed or complied with all of the material terms and
conditions hereof, and the Employer terminates the Employee, the employer will
be bound to pay Employee for the unexpired term of his seven (7) year contract
or a minimum of two (2) years.
27.1. Conversely, in the event that the Employer has failed to perform or
comply with any material term or condition hereof, the employee may terminate
this Agreement by giving the employer 30 day's written notice. In such event
the Employer will be bound to pay Employee whatever monies may still be owed to
Employee for the unexpired term of his seven (7) year contract.
28. Remedies For Breach Of Employment Contract. Any breach or evasion of
any term of the Agreement by either party will cause immediate and irreparable
injury to the other party and will authorize recourse by such party to
injunctive relief and/or specific performance, as well as to all other legal or
equitable remedies to which such party may be entitled.
29. Liquidated Damages Breach Of Employer. Because damages would be
difficult to estimate, Employer agrees to pay Employee in case employer shall
violate this contract of services by dismissing employee, without just cause
before the end of the seven (7) year term hereof, as liquidated damages and not
as a penalty for such breach, a sum of money equal to the amount of salary
earned from the date of such breach to the end of the term hereof, as if
Employee had been permitted fully to perform the terms of this Agreement.
30. Conduct Of Parties After Termination of Employment. Following any
notice of termination of employment by Employer. Employee shall fully cooperate
with employer in all matters relating to the winding up of his pending work on
behalf of the Employer and the orderly transfer of any such pending work.
Employer, however, will refrain from using Employee's name on any brochure,
advertising material, or in any way use Employee's name in any discrediting
manner. Employee, likewise, will not use employer's name in any discrediting
manner.
31. Covenant Not to Compete. The Employer and Employee agree that for a
period of three (3) years following the termination of this Agreement, with
cause, the Employee will not enter the employ of any person firm or corporation
engaged in the same line of business in competition with the employer in any
state in which the Employer has been or is associated with in any manner, nor
himself engaged in the same line of business in competition with the Employer in
any state in which the Employer has been or is associated with in any manner,
nor himself engaged during such period, directly or indirectly, as principal,
agent or Employer in any business in competition with the Company in such state
or states. The Employer and Employee recognize that the services to be
performed by the Employee will require confidentiality as aforesaid.
32. Severability. All agreements and covenants contained herein are
severable and in the event that any of them, should be held to be invalid by a
competent court, this contract shall be interpreted as if such invalid agreement
or covenants were not contained herein.
33. Choice of Law. It is the intention of the parties hereto that this
Agreement and the performance hereunder and all suits and special proceedings
hereunder be construed in accordance with and under and pursuant to the laws of
the State of Utah and that in any action, special proceedings or other
proceeding that may be brought arising out of connection with, or by reason of
this Agreement, the laws of the State of Utah shall be applicable and shall
govern to the exclusion of the law of any other forum, without regard to the
Jurisdiction in which any action or special proceeding may be instituted.
34. Legal Proceedings. Employer agrees to pay for or otherwise indemnify,
defend and hold harmless Employee for any expenses that might occur concerning
any law suits that Employee has to defend while in his normal course of
business. Employer will retain Counsel on his behalf and pay for any expenses
thereof. In addition, Employer agrees to provide Employee with an errors and
omissions insurance policy for the duration of the Employment Agreement.
35. Litigation. Employer stipulates that there is no pending or threatened
litigation against Employer and that there is no basis known to exist for any
such litigation which might result in an impediment in Employee performing his
duties. In addition, Employer stipulates that there is no governmental
investigation pending or threatened against Employer or any of its subsidiaries,
including inquiries, citations or complaints by any federal, state or local
administration; and that there are no outstanding orders, decrees, stipulations
affecting Employer and its subsidiaries.
36. Representations Not Misleading. all representations made by Employer in
this Agreement are true, complete and accurate in all material respects. That
there are no material facts necessary to make such representations not
misleading have been omitted.
37. Headings. The section and subsection headings contained in this
Agreement are for reference purposes only and shall not effect the meaning or
interpretations of this Agreement.
38. Notices. any notices required or permitted herein shall be in writing
and shall be delivered personally or sent by United States, first-class,
certified mail, postage prepaid:
a) If to Employer, address to Marina Capital Inc., 349 South, 200 East,
Suite 370, Salt Lake City, UT 84111.
b) If to employee, address to 195 Alhambra, #3, San Francisco, CA 94123.
39. Entire Agreement Amendments. All negotiations relative to the matter
contemplated by this Agreement are merged herein and there are no other
understandings or agreements relating to the matters and things herein set forth
other than those incorporated in this Agreement. No provisions of this
Agreement shall be altered, amended, revoked, or waived except by an instrument
in writing signed by the party sought to be charged with such amendment,
revocation or waiver.
40. No Third Party Benefits. This Agreement is not intended, and shall not
be deemed or construed, to confer any rights, powers or privileges on any
person, firm, corporation or other entity not a party hereto.
The terms Employer and employee as used throughout this Agreement shall refer
not only to the parties hereto, but also to their respective successor or
assigns.
41. Confidential Treatment. Each party agrees to the use of all reasonable
efforts to keep this document and the information herein in confidence and
should only be revealed upon mutual agreement of the parties.
42. Renewal of Agreement. The parties to this Agreement may extend the
provisions and terms of this Agreement on a year to year basis provided that
said extension is entered into in writing and duly executed to reflect the
agreement of the parties.
43. The Indemnification of Employee Pending the Incorporation of the
Company. Employer hereby agrees that the employer will indemnify Employee from
and against any expenses or liabilities incurred by Employee while performing
his duties on behalf of Employer.
44. Attorney's Fees. If any term of this Agreement is breached, the party
adjudicated by the court to be in wrongful breach shall bear the reasonable
attorney's fees of the party not in breach of the Agreement.
IN WITNESS WHEREOF, the parties have executed this employment Agreement on the
date and year first above written.
MARINA CAPITAL, INC.
by:
Employer
LARRY R. WALKER
by:
Employee
EMPLOYMENT AGREEMENT
THIS AGREEMENT ("the Agreement")
made this first day of April 1999 by and between:
Marina Capital, Inc.,
a Utah Corporation
(hereinafter referred to as "Employer")
and
Richard V. Murray, an individual
(hereinafter referred to as "Employee")
WITNESSETH
WHEREAS, Employer is desirous of employing the Employee as the Chief Operating
Officer of Marina Capital, Inc.; and
WHEREAS, Employee is desirous of being employed by Employer as the Chief
Operating Officer of Marina Capital, Inc.; and
WHEREAS, Employer and Employee have negotiated the terms of this Agreement over
the past several weeks.
NOW, THEREFORE, in consideration of the premises and covenants and Agreements
contained herein, the parties agree as follows:
1. Employment. Employer hereby employs, engages, and hires Employee as the Chief
Operation Officer, and Employee hereby accepts and agrees to such hiring,
engagement and employment. Employee shall in general supervise and control all
of the operations of the Employer. He shall, when present, attend and may
preside at meetings of the shareholders and the Board of Directors. In general,
shall perform all duties relating to operations as may be prescribed by the
Board of Directors, from time to time.
2. Best Efforts of Employee. Employee agrees that he will, at all times
faithfully, industriously, and to the best of his ability, experience, and
talents, perform all of the duties that may be required of and from him pursuant
to the express and implicit terms hereof, to the reasonable satisfaction of
Employer. Such duties shall be rendered in the continental United States, its
Territories, and at such other place or places as the Employer shall in good
faith require of as the interest, needs, business or opportunity may require.
3. Term of Employment. The term of this Agreement shall be for a period of seven
(7) years commencing on November 1, 1996, and terminating October 31, 2003,
subject, however, to prior termination as hereinafter provided. On the
expiration date of this Agreement on October 31, 2003, this Agreement shall be
considered renewed for regular periods of one (1) year or such other period of
time as the parties may agree to, provided neither party submits a notice of
termination.
4. Compensations of Employee. Employer shall pay Employee, and Employee shall
accept from Employer, in full payment for Employee's service hereunder,
compensation at the rate of seventy-five Thousand Dollars ($75,000), in U.S.
Currency, per annum, payable in sums of Six Thousand Two Hundred Fifty Dollars
($6,250) once per month on the first day of each month. The first payment of
Six Thousand Two Hundred Fifty Dollars ($6,250), less Federal, State, Social
Security and other local taxes will be due and payable to Employee on December
1, 1996. The Employer and the Employee on December 1, 1996. The Employer and
the Employee agree that the initial compensation paid by this Agreement is a
minimum rate of payment, which may be increased on the anniversary date by the
Board of Directors.
4.1 Nothing herein shall be construed to prevent the Employer from increasing
the $75,000 per year base salary hereunder during the term of this Agreement, at
the discretion of the Board of Directors.
5. Additional Compensation. The Employer proposes to establish an additional
compensation pool out of the Employer's yearly net profits. The pool will be
made up of a minimum of two hundred thousand dollars ($200,000) or ten percent
(10%) of the Employer's yearly net profits, before taxes, which ever is greater.
The Company will pay Employee three percent (3%) of the Moines or amount in the
pool at the end of the first quarter after the close of Employer's books on an
annual basis. The pool will be established only out of the available revenues
that will not put the Company's liquidity in jeopardy.
5.1. The Board of Directors will review the status of the pool on an annual
basis and make any necessary adjustments, at its sole discretion.
5.2. Employee shall also receive Fifty percent (50%) of all real estate
listings and sales commissions Employee has earned, after deducting employees
monthly salary.
6. Right to Purchase Common Stock. The Employee shall have the right to
purchase common stock of the Employer under the following formula; Each year
within the first sixty (60) days of the anniversary date, starting in 1997,
Employee may purchase up to an amount of stock equal to 5% of the then issued
and outstanding common shares at a price equal to 75% of the book.
7. Other Employment. Employee shall devote all of his time, attention,
knowledge, and skills solely to the business and interest of Employer, and
Employer shall be entitled to all of the benefits, profits or other issues
arising from or incident to all work, services and advise of Employee. Employee
may be permitted to be a partner, officer, director, or stockholder in any other
business, to the extent that the business in question does not create a conflict
of interest with Employer's business and does not detract from the time
necessary to carry on the duties of this Agreement.
8. Recommendations. For Improvement of Operations. Employee shall make
available to Employer all information of which Employee has any knowledge and
shall make all suggestions and recommendations that will be of material benefit
to Employer.
9. Trade Secrets. Employee shall not at any time or in any manner, either
directly or indirectly divulge, disclose or communicate to any person, firm or
Corporation in any manner whatsoever any information concerning any matters
affecting or relating to the business of Employer, including without limitation
to the generality of the foregoing, any of its customers, prices, it obtains or
has obtained from the sale of, or at which it sells or has sold, its properties,
services or any other information concerning the business of Employer, its
manner of operation, its plans, processes, or other data without regard to
whether all of the foregoing matters will be deemed confidential and affect the
effective and successful conduct of the business of Employer, and Employer's
good will, and that any breach of the terms of this paragraph may be considered
as breach of this Agreement.
10. Modification of Contract. No waiver or modification of this Agreement or of
any covenant, condition or limitation herein contained shall be valid unless in
writing and duly executed by the party to be charged therewith and no evidence
of any waiver or modification shall be offered or received in evidence of any
proceeding, arbitration, or litigation between the parties hereto arising out of
or affecting this Agreement, or the rights or obligations of the parties
hereunder, unless such waiver or modification is in writing, duly executed as
aforesaid, and the parties further agree that the provisions of this section may
not be modified except as herein set forth.
11. Agreement Outside of Contract. This contract contains the complete
Agreement concerning the employment Agreement between the parties and shall, as
of the effective date hereof, supersede all other Agreements between the
parties. The parties stipulate that neither of them have made any
representation with respect to the subject matter of this Agreement or any
representations including the execution and delivery hereof except such
representations as are specifically set forth herein and each of the parties
hereof acknowledges that he or it has relied on their own judgment in entering
into this agreement.
12. Failure to Pay Employee. The failure of Employer to pay employee his
salary as provided in this Agreement may, in employee's sole discretion be
deemed a breach of this Agreement, and unless such breach is cured within ten
(10) days after written notice thereof to employer, this employment Agreement
shall terminate, including any non-competitive provisions.
13. Vacation and Holidays. Employee shall be entitled to a paid annual
vacation of thirty (30) days. In consultation with Employer, employee may
accumulate or carry forward to the next calendar year any vacation days as are
necessary under the circumstances. In addition to Vacation, the employee shall
have the normal holidays, additional vacation days will be allowed if a vacation
day and a holiday fall on the same day.
14. Reimbursement for Expenses. Employer shall reimburse Employee for
reasonable out-of-pock expenses which employee shall incur in connection with
his services for employer contemplated hereby on the presentation by Employee of
appropriate vouchers, receipts and contemporaneous notes therefor to Employer.
15. Traveling Expenses. Employer will pay Employee's airline fare, hotel, and
entertainment expenses, and other necessary and proper expenses when traveling
on Employer's business within our outside the Continental United States.
16. Expenses for Promoting business of Employer. Employee is encouraged and is
expected, from time to time, to incur reasonable expenses for the promotion of
the business of the Employer, including expenses for home telephone; automobile
and other transportation, social, athletic and civic club memberships for
himself, family members and other necessary business associates participation,
entertainment, travel and similar items. The cost of these business related
expenses shall be borne by the Employer upon presentation to the employer of
itemized expenses receipts or contemporaneous memoranda of such expenses.
17. Expenses for Attendance at Meetings and Seminars. Employee is encouraged
and is expected at such time or times as employee may find necessary, to attend
seminars, professional meetings, conventions, and educational courses, the cost
of travel, registration, tuition, food, lodging for attending these activities
shall be paid by the Employer. Any other costs incurred by Employee in
connection with these activities shall be the expense of the Employee, unless,
there is mutual agreement with employer and it is determined that any additional
cost of Employee's attendance should be authorized as an expense of employer.
Should any such additional expenses of attendance be authorized, the Employee
shall be reimbursed therefor upon presenting to Employer an itemized receipt or
contemporaneous memoranda of such expenses.
18. Furnishing of Support. Employer shall furnish Employee the necessary
equipment, computer services, support personnel, experts, office space and any
other thing or personnel that may be necessary to perform his duties as Chief
Operating Officer. In addition, the employer shall furnish an automobile
parking space, personal financial counselor and attorney's services at
Employer's expense.
19. Fringe Benefits and Incentive Compensation Plans. Employee shall be
entitled to participate with other officers of the Employer in all fringe
benefits or incentive compensation plans authorized and adopted from time to
time by Employer, including, without limitation; a pension plan, a profit
sharing plan, a medical reimbursement plan, a group life insurance plan, a
disability plan, etc.
20. Automobile Expenses. Employer will pay Employee $800 per month for the use
of Employee's automobile in the course of performing his Employer's business,
only.
21. Illness and Disability. Employee shall be entitled to twenty (20) days sick
leave in each calendar year of employment or if he has not completed a year, the
number of days shall be calculated on a pro-rata basis if he is unable to
perform his duties by reason of illness or accident not resulting in Employee
becoming "totally disabled," without any adjustment in his compensation. Unused
sick leave may only be carried forward to the next calendar year with agreement
of Employer. If employee is unable to perform his duties by reason of total
disability, his salary may be reduced in accordance with the following schedule
during the continuance of such disability.
For six months he shall receive eighty percent (80%) of his monthly salary for
the next six months of disability, he shall receive seventy percent (70%) of his
monthly salary.
Thereafter, the Employer will have had in place a long term disability policy
which will guarantee fifty percent (50%) of the Employee's highest monthly
salary for the term of his disability in determining periods of disability any
new periods of disability, shall be deemed to be a continuation of the prior
period of disability if the Employee has not returned to work for at least one
(1) month between such periods of disability. If employee becomes disabled, but
the disability ceased before termination of his employment with Employer,
Employee's salary shall be reinstated on the date the disability ends.
22. Nonabatement of Salary in Event of Illness. It is understood and agreed
that the Employee shall not be considered as having breached this Agreement of
Employment in the event that he becomes unable to perform services for the
Employer because of sickness or disability, however, subject to paragraph 17,
and in the event Employee's salary shall not abate or in any other way be
curtailed.
23. Termination by Death. If the employee dies before his employment with
Employer is otherwise terminated, payments and/or benefits to which he would
then have been entitled to at the time of his death, shall be paid over to his
beneficiary and if no beneficiary survives him, the entire amount due him shall
be paid to his estate.
24. Payment of Professional Dues. Employer shall pay all dues of Employee in
any professional association to which the Employee may find it necessary to
belong in order to carry out his duties, and promote the business of Employer.
In addition, Employer will pay for the purchase of professional periodicals,
newspapers, and magazines which Employee may find necessary in order to carry
out his duties.
25. Medical & Life Insurance. Employer shall provide employee with a major
medical insurance policy. The cost of said policy shall be borne by Employer.
The medical insurance policy shall include but not be limited to dental care,
and psychiatric counseling. In addition there shall be no deductible as it
relates to the insurance policy. The Employer shall arrange and pay for the
medical insurance for the Employee's dependents. Employer shall also provide a
paid life insurance policy for Employee and spouse. The minimum benefit for the
beneficiary shall be no less than $250,000.
26. Deduction for Taxes. Employer shall deduct from the compensation payable
to Employee under all of the provisions of this employment Agreement, social
security taxes, and all federal, state and municipal taxes and charges as now
may be in effect or which may hereafter be enacted or required.
27. Performance and Termination - Employment Period. Subject, to the
performance of the covenants and agreement made by the employer herein, the
employee will perform his duties during the Employment Period in good faith and
will observe faithfully the covenants and agreements made by him herein. The
Employee shall not be discharged during the Employment Period except for
substantial and serious cause involving dishonesty or material breach of express
obligations of this Agreement within the control of the Employee. The discharge
of the Employee for reasons other than those specified in the preceding sentence
shall be of no force and effect. No breach or default by the employee shall be
deemed to have occurred thereunder unless written notice setting forth with
specificity the alleged incidents of default thereof shall have been given by
the Employer to the Employee and the Employee shall have failed to cure the
breach or default within sixty (60) days after he receives the written notice
If Employee has performed or complied with all of the material terms and
conditions hereof, and the Employer terminates the Employee, the employer will
be bound to pay Employee for the unexpired term of his seven (7) year contract
or a minimum of two (2) years.
27.1. Conversely, in the event that the Employer has failed to perform or comply
with any material term or condition hereof, the employee may terminate this
Agreement by giving the employer 30 day's written notice. In such event the
Employer will be bound to pay Employee whatever monies may still be owed to
Employee for the unexpired term of his seven (7) year contract.
28. Remedies For Breach Of Employment Contract. Any breach or evasion of any
term of the Agreement by either party will cause immediate and irreparable
injury to the other party and will authorize recourse by such party to
injunctive relief and/or specific performance, as well as to all other legal or
equitable remedies to which such party may be entitled.
29. Liquidated Damages Breach of Employer. Because damages would be difficult
to estimate, Employer agrees to pay Employee in case employer shall violate this
contract of services by dismissing employee, without just cause before the end
of the seven (7) year term hereof, as liquidated damages and not as a penalty
for such breach, a sum of money equal to the amount of salary earned from the
date of such breach to the end of the term hereof, as if Employee had been
permitted fully to perform the terms of this Agreement.
30. Conduct Of Parties After Termination of Employment. Following any notice
of termination of employment by Employer. Employee shall fully cooperate with
employer in all matters relating to the winding up of his pending work on behalf
of the Employer and the orderly transfer of any such pending work. Employer,
however, will refrain from using Employee's name on any brochure, advertising
material, or in any way use Employee's name in any discrediting manner.
Employee, likewise, will not use employer's name in any discrediting manner.
31. Covenant Not to Compete. The Employer and Employee agree that for a period
of three (3) years following the termination of this Agreement, with cause, the
Employee will not enter the employ of any person firm or corporation engaged in
the same line of business in competition with the employer in any state in which
the Employer has been or is associated with in any manner, nor himself engaged
in the same line of business in competition with the Employer in any state in
which the Employer has been or is associated with in any manner, nor himself
engaged during such period, directly or indirectly, as principal, agent or
Employer in any business in competition with the Company in such state or
states. The Employer and Employee recognize that the services to be performed
by the Employee will require confidentiality as aforesaid.
32. Severability. All agreements and covenants contained herein are severable
and in the event that any of them, should be held to be invalid by a competent
court, this contract shall be interpreted as if such invalid agreement or
covenants were not contained herein.
33. Choice of Law. It is the intention of the parties hereto that this
Agreement and the performance hereunder and all suits and special proceedings
hereunder be construed tin accordance with and under and pursuant to the laws of
the State of Utah and that in any action, special proceedings or other
proceeding that may be brought arising out of connection with, or by reason of
this Agreement, the laws of the State of Utah shall be applicable and shall
govern to the exclusion of the law of any other forum, without regard to the
Jurisdiction in which any action or special proceeding may be instituted.
34. Legal Proceedings. Employer agrees to pay for or otherwise indemnify,
defend and hold harmless Employee for any expenses that might occur concerning
any law suits that Employee has to defend while in his normal course of
business. Employer will retain Counsel on his behalf and pay for any expenses
thereof. In addition, Employer agrees to provide Employee with an errors and
omissions insurance policy for the duration of the Employment Agreement.
35. Litigation. Employer stipulates that there is no pending or threatened
litigation against Employer and that there is no basis known to exist for any
such litigation which might result in an impediment in Employee performing his
duties. In addition, Employer stipulates that there is no governmental
investigation pending or threatened against Employer or any of its subsidiaries,
including inquiries, citations or complaints by any federal, state or local
administration; and that there are no outstanding orders, decrees, stipulations
affecting Employer and its subsidiaries.
36. Representations Not Misleading. All representations made by Employer in
this Agreement are true, complete and accurate in all material respects. That
there are no material facts necessary to make such representations not
misleading have been omitted.
37. Headings. The section and subsection headings contained in this Agreement
are for reference purposes only and shall not effect the meaning or
interpretations of this Agreement.
38. Notices. Any notices required or permitted herein shall be in writing and
shall be delivered personally or sent by United States, first-class, certified
mail, postage prepaid:
a) If to Employer, address to Marina Capital Inc., 349 South, 200 East, Suite
370, Salt Lake City, UT 84111.
b) If to employee, address to 3748 Divisidero Street, San Francisco, CA 94123.
39. Entire Agreement Amendments. All negotiations relative to the matter
contemplated by this Agreement are merged herein and there are no other
understandings or agreements relating to the matters and things herein set forth
other than those incorporated in this Agreement. No provisions of this
Agreement shall be altered, amended, revoked, or waived except by an instrument
in writing signed by the party sought to be charged with such amendment,
revocation or waiver.
40. No Third Party Benefits. This Agreement is not intended, and shall not be
deemed or construed, to confer any rights, powers or privileges on any person,
firm, corporation or other entity not a party hereto.
The terms Employer and employee as used throughout this Agreement shall refer
not only to the parties hereto, but also to their respective successor or
assigns.
41. Confidential Treatment. Each party agrees to the use of all reasonable
efforts to keep this document and the information herein in confidence and
should only be revealed upon mutual agreement of the parties.
42. Renewal of Agreement. The parties to this Agreement may extend the
provisions and terms of this Agreement on a year to year basis provided that
said extension is entered into in writing and duly executed to reflect the
agreement of the parties.
43. The Indemnification of Employee Pending the Incorporation of the Company.
Employer hereby agrees that the employer will indemnify Employee from and
against any expenses or liabilities incurred by Employee while performing his
duties on behalf of Employer.
44. Attorney's Fees. If any term of this Agreement is breached, the party
adjudicated by the court to be in wrongful breach shall bear the reasonable
attorney's fees of the party not in breach of the Agreement.
IN WITNESS WHEREOF, the parties have executed this employment Agreement on the
date and year first above written.
MARINA CAPITAL, INC.
by:
Employer
RICHARD V. MURRAY
by:
Employee
EMPLOYMENT AGREEMENT
THIS AGREEMENT ("the Agreement")
made this first day of April 1999 by and between:
Marina Capital, Inc.,
a Utah Corporation
(hereinafter referred to as "Employer")
and
Jon R. Blanchard, an individual
(hereinafter referred to as "Employee")
WITNESSETH
WHEREAS, Employer is desirous of employing the Employee as the Vice President
for Development Services of Marina Capital, Inc.; and
WHEREAS, Employee is desirous of being employed by Employer as the Vice
President of Development Services for Marina Capital, Inc.; and
WHEREAS, Employer and Employee have negotiated the terms of this Agreement over
the past several weeks.
NOW, THEREFORE, in consideration of the premises and covenants and Agreements
contained herein, the parties agree as follows:
1. Employment. Employer hereby employs, engages, and hires Employee as
the Vice President of Development Services, and Employee hereby accepts and
agrees to such hiring, engagement and employment. Employee shall in general
supervise and control all of the operations of the Development Services
Department, including negotiating, land planning, consulting and contractor
agreements, which shall be finally approved by Employer. In general, shall
perform all duties relating to the business and operations of the Development
Services Department or as may be prescribed by the Chief Executive Officer,
from time to time.
2. Best Efforts of Employee. Employee agrees that he will, at all times
faithfully, industriously, and to the best of his ability, experience, and
talents, perform all of the duties that may be required of and from him
pursuant to the express and implicit terms hereof, to the reasonable
satisfaction of Employer. Such duties shall be rendered in the continental
United States, its Territories, and at such other place or places as the
Employer shall in good faith require of as the interest, needs, business or
opportunity may require.
3. Term of Employment. The term of this Agreement shall be for a period of
three (3) years commencing on April 1, 1999, and terminating March 31, 2002,
subject, however, to prior termination as hereinafter provided. On the
expiration date of this Agreement on March 31, 2002, this Agreement shall be
considered renewed for regular periods of one (1) year or such other period of
time as the parties may agree to, provided neither party submits a notice of
termination.
4. Compensation of Employee. Employer shall pay Employee, and Employee
shall accept from Employer, in full payment for Employee's service hereunder,
compensation at the rate of sixty two thousand four hundred dollars ($62,400),
in U.S. Currency, per annum, payable in sums of five thousand two hundred
dollars ($5,200) once per month on the first day of each month. The first
payment of five thousand two hundred dollars ($5,200), less Federal, State,
Social Security and other local taxes will be earned and payable to Employee on
May l, 1999. The Employer and the Employee agree that the base salary paid by
this Agreement is a minimum rate of payment, which may be increased on the
annual anniversary date by the Board of Directors, at their discretion
hereunder during the term of this Agreement.
5. Additional Compensation. The Employer proposes to establish an
additional compensation pool out of the Employer's yearly net profits. The pool
will be made up of a minimum of two hundred thousand dollars ($200,000) or ten
percent (10%) of the Employer's yearly net profits, before taxes, which ever is
greater. The Company will pay Employee ten percent (10%) of amount in the pool
at the end of the first quarter after the close of Employer's books on an annual
basis. The pool will be established only out of the available revenues that
will not put the Company's liquidity in jeopardy and at the Board of Directors
discretion.
5.1. The Board of Directors will review the status of the pool on an annual
basis and make any necessary adjustments, at its sole discretion.
6. Right to Purchase Common Stock. The Employee shall have the right to
purchase common stock of the Employer under the following formula. Each year
within the first sixty (60) days of the anniversary date, starting in 2000,
Employee may purchase up to an amount of stock equal to 5% of the then issued
and outstanding common shares at a price equal to 75% of the book value.
7. Other Employment. Employee shall devote all of his time, attention,
knowledge, and skills solely to the business and interest of Employer, and
Employer shall be entitled to all of the benefits, profits or other issues
arising from or incident to all work, services and advise of Employee. Employee
maybe permitted to be a partner, officer, director, or stockholder in any other
business, to the extent that the business in question does not create a conflict
of interest with Employer's business and does not detract from the time
necessary to carry out the duties of this Agreement.
8. Employer Rights. Employee shall make available to Employer all
information of which Employee has any knowledge and shall make all suggestions
and recommendations that will be of benefit to Employer. All material, plans,
brochures, agreements, notes, forms, etc. prepared or designed by Employee, in
the performance of his duties for Employer, shall become the property of the
Employer.
9. Trade Secrets. Employee shall not at any time or in any manner, either
directly or indirectly divulge, disclose or communicate to any person, firm or
Corporation in any manner whatsoever any information concerning any matters
affecting or relating to the business of Employer, including without limitation
to the generality of the foregoing, any of its customers, prices, it obtains or
has obtained from the sale of, or at which it sells or has sold, its properties,
services or any other information concerning the business of Employer, its
manner of operation, its plans, processes, or other data without regard to
whether all of the foregoing matters will be deemed confidential and affect the
effective and successful conduct of the business of Employer, and Employer's
good will, and that any breach of the terms of this paragraph may be considered
as breach of this Agreement.
10. Modification of Contract. No waiver or modification of this Agreement or
of any covenant, condition or limitation herein contained shall be valid unless
in writing and duly executed by the party to be charged therewith and no
evidence of any waiver or modification shall be offered or received in evidence
of any proceeding, arbitration, or litigation between the parties hereto arising
out of or affecting this Agreement, or the rights or obligations of the parties
hereunder, unless such waiver or modification is in writing, duly executed as
aforesaid, and the parties further agree that the provisions of this section may
not be modified except as herein set forth.
11. Agreement Outside of Contract. This contract contains the complete
Agreement concerning the employment Agreement between the parties and shall, as
of the effective date hereof, supersede all other Agreements between the
parties. The parties stipulate that neither of them have made any
representation with respect to the subject matter of this Agreement or any
representations including the execution and delivery hereof except such
representations as are specifically set forth herein and each of the parties
hereof acknowledges that he has relied on his own judgment in entering into this
agreement.
12. Vacation and Holidays. Employee shall be entitled to a paid annual
vacation of fourteen (14) days. In addition to vacation, the employee shall
have the normal holidays, additional vacation days will be allowed if a vacation
day and a holiday fall on the same day.
13. Reimbursement for Expenses. Employer shall reimburse Employee for
reasonable out-of-pocket expenses which employee shall incur in connection with
his services for employer contemplated hereby on the presentation by Employee of
appropriate vouchers, receipts and contemporaneous notes therefor to Employer.
14. Traveling Expenses. Employer will pay Employee's airline fare, hotel,
and entertainment expenses, and other necessary and proper expenses when
traveling on Employer's business within or outside the Continental United
States.
15. Expenses for Promoting Business of Employer. Employee is encouraged and
is expected, from time to time, to incur reasonable expenses for the promotion
of the business of the Employer, including expenses for home telephone;
automobile and other transportation, social, athletic and civic club memberships
for himself, family members and other necessary business associates
participation, entertainment, travel and similar items. The cost of these
business related expenses shall be borne by the Employer upon presentation to
the employer of itemized expenses receipts or contemporaneous memoranda of such
expenses.
16. Expenses for Attendance at Meetings and Seminars. Employee is encouraged
and is expected at such time or times as employee may find necessary, to attend
seminars, professional meetings, conventions, and educational courses. The cost
of travel, registration, tuition, food, lodging for attending these activities
shall be paid by the Employer. Any other costs incurred by Employee in
connection with these activities shall be the expense of the Employee, unless,
there is mutual agreement with employer and it is determined that any additional
cost of Employee's attendance should be authorized as an expense of Employer.
Should any such additional expenses of attendance be authorized, the Employee
shall be reimbursed therefor upon presenting to Employer an itemized receipt or
contemporaneous memoranda of such expenses.
17. Furnishing of Support. Employer shall furnish Employee the necessary
equipment, computer services, support personnel, experts, office space and or
personnel that may be necessary to perform his duties.
18. Fringe Benefits and Incentive Compensation Plans. Employee shall be
entitled to participate with other officers of the Employer in all fringe
benefits or incentive compensation plans authorized and adopted from time to
time by Employer, including, without limitation; a pension plan, a profit
sharing plan, a medical reimbursement plan, a group life insurance plan, a
disability plan, etc.
19. Miscellaneous Expenses. Employer will pay Employee $800 per month for
expenses such as automobile, equipment, telephone, etc. in the course of
performing his duties.
20. Sick Leave. Employee shall be entitled to twenty (20) days sick leave in
each calendar year of employment or if he has not completed a year, the number
of days shall be calculated on a pro-rata basis if he is unable to perform his
duties by reason of illness or accident not resulting in Employee becoming
"totally disabled," without any adjustment in his compensation. Unused sick
leave may only be carried forward to the next calendar year with agreement of
Employer.
21. Non-abatement of Salary in Event of Illness. It is understood and agreed
that the Employee shall not be considered as having breached this Agreement of
Employment in the event that he becomes unable to perform services for the
Employer because of sickness or disability and in the event Employee's salary
shall not abate or in any other way be curtailed.
22. Termination by Death. If the employee dies before his employment with
Employer is otherwise terminated, payments and/or benefits to which he would
then have been entitled to at the time of his death, shall be paid over to his
beneficiary and if no beneficiary survives him, the entire amount due him shall
be paid to his estate.
23. Payment of Professional Dues. Employer shall pay all dues of Employee in
any professional association to which the Employee may find it necessary to
belong in order to carry out his duties, and promote the business of Employer.
24. Medical Insurance. Employer shall provide employee with a major medical
insurance policy. The cost of said policy shall be paid by Employer. In
addition there shall be no deductible as it relates to the insurance policy.
25. Deduction For Taxes. Employer shall deduct from the compensation payable
to Employee under all of the provisions of this employment Agreement, social
security taxes, and all federal, state and municipal taxes and charges as now
may be in effect or which may hereafter be enacted or required.
26. Performance and Termination - Employment Period. Subject, to the
performance of the covenants and agreement made by the Employer herein, the
Employee will perform his duties during the Employment Period in good faith and
will observe faithfully the covenants and agreements made by him herein. The
Employee shall not be discharged during the employment period except for
substantial and serious cause involving dishonesty or material breach of express
obligations of this Agreement within the control of the Employee. The discharge
of the Employee for reasons other than those specified in the preceding sentence
shall be of no force and effect. No breach or default by the Employee shall be
deemed to have occurred thereunder unless written notice setting forth with
specificity the alleged incidents of default thereof shall have been given by
the Employer to the Employee and the Employee shall have failed to cure the
breach or default within sixty (60) days after he receives the written notice.
If Employee has performed or complied with all of the material terms and
conditions hereof, and the Employer terminates the Employee, the Employer will
be bound to pay Employee for the unexpired term of his Agreement, or a minimum
of one (1) year pay.
26.1. Conversely, in the event that the Employer has failed to perform or
comply with any material term or condition herein, the Employee may terminate
this Agreement by giving the Employer 30 day's written notice. In such event
the Employer will be bound to pay Employee whatever pay may still be owed to
Employee for the unexpired term of his Agreement.
27. Remedies For Breach Of Employment Contract. Any breach or evasion of any
term of the Agreement by either party will cause immediate and irreparable
injury to the other party and will authorize recourse by such party to
injunctive relief and/or specific performance, as well as to all other legal or
equitable remedies to which such party may be entitled.
28. Liquidated Damages Breach of Employer. Because damages would be
difficult to estimate, Employer agrees to pay Employee in case Employer shall
violate this Agreement of services by dismissing Employee, without just cause
before the end of the term hereof, as liquidated damages and not as a penalty
for such breach, a sum of money equal to the amount of salary earned from the
date of such breach to the end of the term hereof, as if Employee had been
permitted fully to perform the terms of this Agreement.
29. Conduct Of Parties After Termination of Employment. Following any notice
of termination of employment by Employer. Employee shall fully cooperate with
employer in all matters relating to the winding up of his pending work on behalf
of the Employer and the orderly transfer of any such pending work. Employer,
however, will refrain from using Employee's name on any brochure, advertising
material, or in any way use Employee's name in any discrediting manner.
Employee, likewise, will not use Employer's name in any discrediting manner.
30. Covenant Not to Compete. The Employer and Employee agree that for a
period of two (2) years following the termination of this Agreement, with cause,
the Employee will not enter the employ of any person, firm or corporation
engaged in the same line of business in competition with the employer in any
state in which the Employer has been or is associated with in any manner, nor
himself engaged in the same line of business in competition with the Employer in
any state in which the Employer has been or is associated with in any manner,
nor himself engaged during such period, directly or indirectly, as principal,
agent or Employer in any business in competition with the Company in such state
or states. The Employer and Employee recognize that the services to be performed
by the Employee will require confidentiality as aforesaid.
31. Severability. All agreements and covenants contained herein are
severable and in the event that any of them, should be held to be invalid by a
competent court, this contract shall be interpreted as if such invalid agreement
or covenants were not contained herein.
32. Choice of Law. It is the intention of the parties hereto that this
Agreement and the performance hereunder and all suits and special proceedings
hereunder be construed in accordance with and under and pursuant to the laws of
the State of Utah and that in any action, special proceedings or other
proceeding that may be brought arising out of connection with, or by reason of
this Agreement, the laws of the State of Utah shall be applicable and shall
govern to the exclusion of the law of any other forum, without regard to the
Jurisdiction in which any action or special proceeding may be instituted.
33. Legal Proceedings. Employer agrees to pay for or otherwise indemnify,
defend and hold harmless Employee for any expenses that might occur concerning
any law suits that Employee has to defend while in his normal course of
business. Employer will retain Counsel on his behalf and pay for any expenses
thereof. In addition, Employer agrees to provide Employee with an errors and
omissions insurance policy for the duration of the Employment Agreement.
34. Litigation. Employer stipulates that there is no pending or threatened
litigation against Employer and that there is no basis known to exist for any
such litigation which might result in an impediment in Employee performing his
duties. In addition, Employer stipulates that there is no governmental
investigation pending or threatened against Employer or any of its subsidiaries,
including inquiries, citations or complaints by any federal, state or local
administration; and that there are no outstanding orders, decrees, stipulations
affecting Employer and its subsidiaries.
35. Representations Not Misleading. All representations made by Employer in
this Agreement are true, complete and accurate in all material respects. That
there are no material facts necessary to make such representations not
misleading have been omitted.
36. Headings. The section and subsection headings contained in this
Agreement are for reference purposes only and shall not effect the meaning or
interpretations of this Agreement.
37. Notices. Any notices required or permitted herein shall be in writing
and shall be delivered personally or sent by United States, first-class,
certified mail, postage prepaid:
If to Employer, address to Marina Capital Inc., Shupe-Williams Plaza, 2605 Wall
Avenue, Ogden, Utah 84401.
If to Employee, address to Box 329 Duchesne, UT 84021 435-548-2726.
38. Entire Agreement Amendments. All negotiations relative to the matter
contemplated by this Agreement are merged herein and there are no other
understandings or agreements relating to the matters and things herein set forth
other than those incorporated in this Agreement. No provisions of this
Agreement shall be altered, amended, revoked, or waived except by an instrument
in writing signed by the party sought to be charged with such amendment,
revocation or waiver.
39. No Third Party Benefits. This Agreement is not intended, and shall not
be deemed or construed, to confer any rights, powers or privileges on any
person, firm, corporation or other entity not a party hereto.
The terms Employer and Employee as used throughout this Agreement shall refer
not only to the parties hereto, but also to their respective successor or
assigns.
40. Confidential Treatment. Each party agrees to the use of all reasonable
efforts to keep this document and the information herein in confidence and
should only be revealed upon mutual agreement of the parties.
41. Renewal of Agreement. The parties to this Agreement may extend the
provisions and terms of this Agreement on a year to year basis provided that
said extension is entered into in writing and duly executed to reflect the
agreement of the parties.
42. The Indemnification of Employee. Employer hereby agrees that the
employer will indemnify Employee from and against any expenses or liabilities
incurred by Employee while performing his duties on behalf of Employer.
43. Attorney's Fees. If any term of this Agreement is breached, the party
adjudicated by the court to be in wrongful breach shall bear the reasonable
attorney's fees of the party not in breach of the Agreement.
IN WITNESS WHEREOF, the parties have executed this employment Agreement on the
date and year first above written.
MARINA CAPITAL,INC.
by:
Larry R. Walker President/CEO
by:
Jon B. Blanchard Employee
STOCK OPTION AGREEMENT
THIS AGREEMENT made this 20th day of October, 1998 by and between Marina
Capital, Inc., a Utah corporation (hereinafter the "Company"), and Kevin
Molinari, whose address is 2375 Bay Street, San Francisco, California
(hereinafter the "Optionee").
WITTNESSTH
WHEREAS, the Company has the power and authority to grant options to advance the
welfare of the Company;
WHEREAS, the Company considers the Optionee a valued and trusted advisor in
financial and real estate matters and the Company considers it desirable and in
its best interest that Optionee be given an inducement to continue to provide
advice to the Company, and to be given an added incentive to advance the
interests of the Company by possessing an option to purchase 300,000 shares of
the Company's $.001 par value Common Stock; and
WHEREAS, the Company and Optionee have negotiated the terms of this Stock Option
Agreement over the last ten (10) days.
NOW, THEREFORE, in consideration of the premises, it is agreed by and between
the parties as follows:
1. Grant of Option. The Company hereby grants to Optionee the rights,
privilege. and option to purchase 300,000 shares of the Company's $001 par value
Common Stock at the purchase price of $2.50 per share. in the manor and subject
to the condition hereinafter set forth.
2. Time of Exercise of Option. The aforesaid option is exercisable no later
than seventy-two (72) months from the date of execution of this Stock Option
Agreement.
2.1 The option period may be extended for an additional ninety' (90) days by'
mutual agreement between the Company and the Optionee. Failure to exercise the
option within the time provided, will cause the option to become null and void
and of no further effect and will be cancelled.
2.2 The option may not be exercised in whole or in part for a one (1) year
period from the date of execution of this Stock Option Agreement. After the
expiation of such one (1) year period, and as long as, the option has not been
terminated as provided herein, the option may be exercised in whole or in part
from time to time.
2.3 A thirty (30) day written notice to the Company must be given by the
Optionee before the date of the exercise of any part of the option, by the
Optionee.
3. Method of Exercise. The option shall be exercised by a thirty (30) day
written notice to the Board of Directors, at the Company's principal place of
business, accompanied by a certified or cashiers check (United States currency)
in payment of the option price for the shares specified and paid for. The
Company shall make immediate delivery of such shares, provided that if any law
or regulation requires the Company to take any action with respect to the
shares.
4. Termination of Option. Except as herein otherwise set forth, the option
to the extent not heretofore exercised shall terminate upon the first to occur
of the following dates:
(a) The expiration of the seventy two (72) months and an extension of ninety
(90) days from the date of the execution of this Stock Option Agreement; and
(b) The event of Optionee's death, the Optionee's executors or administrators
may exercise, within ninety (90) days following the date of Optionee's death.
5. Reclassification. Consolidation or Merger. If and to the extent that the
number of issued shares of voting Common Stock of the Company shall be increased
or reduced by change in par value, split, reclassification, distribution or a
dividend payable in stock or the like, the number of shares subject to the
option and the option price per share shall be proportionately adjusted. If the
Company is reorganized, consolidated, or merged, the Company shall issue
Optionee an option in the same proportion at an equivalent price, and subject to
the same conditions as set forth herein. For purposes of the preceding sentence,
the new option or assumption of the old option shall not give Optionee
additional benefits which Optionee did not have under the original option, or
deprive Optionee of benefits which Optionee had under the original option.
6. Rights Prior to Exercise of Option. This option may be transferable by
Optionee, upon the mutual agreement of the parties except in the event of
Optionee's death as provided in paragraph 4(b) above, whereby Optionee's
executors or administrators may transfer the option upon mutual agreement of the
parties. Optionee shall have no rights as a stockholder with respect to the
option shares until payment of the option price and delivery to him of such
shares as herein provided.
7. Restrictions on Disposition. Shares distributed under this Stock Option
Agreement are unregistered with the Securities and Exchange Commission and are
subject to the restrictions pursuant to Rule 144 of the Securities Act.
S. Governing Law. The laws of the State of Utah shall govern the
interpretation, validity and performance of the terms of the Stock Option
Agreement regardless of the law that might be applied under principals of
Conflict of Laws.
9. Binding Effect. This Stock Option Agreement shall inure to the benefit
of and be binding upon the parties hereto and their respective heirs, executors,
administrators , successors and assigns.
In witness whereof the parties hereto have caused this Stock Option Agreement to
be executed on the day and year first above written.
Optionee Marina Capital, Inc.
Kevin Molinari Larry R. Walker-President
STOCK OPTION AGREEMENT
THIS AGREEMENT made this 14th day of December, 1998 by and between Marina
Capital, Inc., a Utah corporation (hereinafter the "Company"), and Kevin
Molinari, whose address is 2375 Bay Street, San Francisco, California
(hereinafter the "Optionee").
WITTNESSTH
WHEREAS, the Company has the power and authority to grant options to advance the
welfare of the Company;
WHEREAS, the Company considers the Optionee a valued and trusted advisor in
financial and real estate matters and the Company considers it desirable and in
its best interest that Optionee be given an inducement to continue to provide
advice to the Company, and to be given an added incentive to advance the
interests of the Company by possessing an option to purchase 200,000 shares of
the Company's $.001 par value Common Stock; and
WHEREAS, the Company and Optionee have negotiated the terms of this Stock Option
Agreement over the last ten (10) days.
NO\V, THEREFORE, in consideration of the premises, it is agreed by and between
the parties as follows:
1. Grant of Option. The Company hereby grants to Optionee the rights,
privilege. and option to purchase 200,000 shares of the Company's $001 par value
Common Stock at the purchase price of $2.50 per share. in the manor and subject
to the condition hereinafter set forth.
2. Time of Exercise of Option. The aforesaid option is exercisable no later
than seventy-two (72) months from the date of execution of this Stock Option
Agreement.
2.1 The option period may be extended for an additional ninety' (90) days by'
mutual agreement between the Company and the Optionee. Failure to exercise the
option within the time provided, will cause the option to become null and void
and of no further effect and will be cancelled.
2.2 The option may not be exercised in whole or in part for a one (1) year
period from the date of execution of this Stock Option Agreement. After the
expiation of such one (1) year period, and as long as, the option has not been
terminated as provided herein, the option may be exercised in whole or in part
from time to time.
2.3 A thirty (30) day written notice to the Company must be given by the
Optionee before the date of the exercise of any part of the option, by the
Optionee.
3. Method of Exercise. The option shall be exercised by a thirty (30) day
written notice to the Board of Directors, at the Company's principal place of
business, accompanied by a certified or cashiers check (United States currency)
in payment of the option price for the shares specified and paid for. The
Company shall make immediate delivery of such shares, provided that if any law
or regulation requires the Company to take any action with respect to the
shares.
4. Termination of Option. Except as herein otherwise set forth, the option
to the extent not heretofore exercised shall terminate upon the first to occur
of the following dates:
(a) The expiration of the seventy two (72) months and an extension of ninety
(90) days from the date of the execution of this Stock Option Agreement; and
(b) The event of Optionee's death, the Optionee's executors or administrators
may exercise, within ninety (90) days following the date of Optionee's death.
5. Reclassification. Consolidation or Merger. If and to the extent that the
number of issued shares of voting Common Stock of the Company shall be increased
or reduced by change in par value, split, reclassification, distribution or a
dividend payable in stock or the like, the number of shares subject to the
option and the option price per share shall be proportionately adjusted. If the
Company is reorganized, consolidated, or merged, the Company shall issue
Optionee an option in the same proportion at an equivalent price, and subject to
the same conditions as set forth herein. For purposes of the preceding sentence,
the new option or assumption of the old option shall not give Optionee
additional benefits which Optionee did not have under the original option, or
deprive Optionee of benefits which Optionee had under the original option.
6. Rights Prior to Exercise of Option. This option may be transferable by
Optionee, upon the mutual agreement of the parties except in the event of
Optionee's death as provided in paragraph 4(b) above, whereby Optionee's
executors or administrators may transfer the option upon mutual agreement of the
parties. Optionee shall have no rights as a stockholder with respect to the
option shares until payment of the option price and delivery to him of such
shares as herein provided.
7. Restrictions on Disposition. Shares distributed under this Stock Option
Agreement are unregistered with the Securities and Exchange Commission and are
subject to the restrictions pursuant to Rule 144 of the Securities Act.
S. Governing Law. The laws of the State of Utah shall govern the
interpretation, validity and performance of the terms of the Stock Option
Agreement regardless of the law that might be applied under principals of
Conflict of Laws.
9. Binding Effect. This Stock Option Agreement shall inure to the benefit
of and be binding upon the parties hereto and their respective heirs, executors,
administrators , successors and assigns.
In witness whereof the parties hereto have caused this Stock Option Agreement to
be executed on the day and year first above written.
Optionee Marina Capital, Inc.
Kevin Molinari Larry R. Walker-President
Marina Capital Incorporated
Shupe-Williams Plaza
2605 Wall Avenue
Ogden Utah, 84401
801-394-2400
RE: Subscription Agreement
The Undersigned has had several discussions regarding Marina Capital, Inc.
("Company"), and as a result thereof the Undersigned wishes to subscribe for
forty (40,000) thousand shares of the Company's $.001 par value Common Stock.
The Undersigned understands that the shares are being offered at a purchase
price of $3.75 per share, and accordingly the Undersigned tenders herewith the
full purchase price of $150,000.
Additionally: At the Undersigned's option on signing this subscription agreement
the Undersigned may purchase up to one hundred (100,000) thousand additional
shares (minimum 25,000) of the Company's $001 par value Common stock at a
purchase price of $2.00 per share and will tender the additional purchase price
on or before May 15, 1999.
The Undersigned understands that the Articles of Incorporation authorize the
Company to sell up to 30,000,000 shares of Common Stock and that the shares
being purchased for sale are without preemptive rights. Dividends paid, if any,
on the shares shall be in such amounts and on such dates as the Board of
Directors may declare specifically for such shares. The shares win have no
conversion rights.
In connection with the Undersigned's proposed purchase of the shares, the
Undersigned represents the following:
1. The shares being acquired by the Undersigned are for the Undersigned's
own account and not on behalf of any other person.
Initial: ( )
2. The shares being purchased are being acquired for investment purposes
and not for resale or distribution.
Initial: ( )
3. Neither the Undersigned or anyone acting on the Undersigned's behalf
paid any commission or other remuneration to any person in connection with the
execution of this transaction or the purchase of the shares.
Initial: ( )
4. The Undersigned has had the opportunity to request and receive
sufficient information from the Company to enable the Undersigned, or the
Undersigned's advisor, accountant or attorney to fairly evaluate the merits of a
proposed investment in the Company. In this connection the Company has made
available documents including but not limited to the following:
a. Books and Records of the Company
Initial: ( )
The Undersigned has discussed all matters pertinent to the business of the
Company with regards to its management. As a result, the Undersigned is
cognizant of the financial condition and operations of the Company, has
available full information concerning its affairs and has been able to evaluate
the merits and risks of the investment in the shares.
Specifically:
He/she has made, or caused to be made, such investigation of the Company, its
management, and its operations as he/she considers necessary and appropriate to
enable him/her to make an informed decision regarding his/her investment.
Prior to making his/her investment, he/she was presented with and acted upon the
opportunity to ask questions and receive answers from the Company and/or other
directors and officers and of the Company relating to the business and
operations of the Company and to obtain any additional information necessary to
verify the accuracy of the information made available to him/her.
Prior to making his/her investment he/she made arrangements to conduct
inspection as he/she deemed necessary of the books, records, contracts,
instruments and other data relating to the operations of the Company.
The Undersigned has been provided with the opportunity to inspect, review and
obtain expert opinion and counsel with respect to such inspection and to review
the corporate minute books, stock book, stock ledger and such other items of the
Company's history as the Undersigned has deemed necessary and is therefore
satisfied as to the present status and condition of such matters.
Initial: ( )
5. The Undersigned's present financial condition is such that it is
unlikely that it would be necessary for the Undersigned to dispose of any of the
shares, in the foreseeable future.
Initial: ( )
6. The Undersigned understands that the shares are restricted securities
within the meaning of Rule 144 or the General Rules and Regulations under the
Securities Act of 1933 (the "Act"). If either Rule 144 or Rule 237 is available
for the resale of the shares, the Undersigned understands that he/she may resell
the shares only in accordance with its limitation. The Undersigned consents to
the placement of an appropriate restrictive legend on the certificate evidencing
the shares of any certificates issued in replacement or exchange thereof.
Initial: ( )
7. The Undersigned understands and agrees:
a. that the securities being purchased have not been registered under the Act or
any state securities laws;
b. that the Undersigned cannot sell the securities being purchased unless they
are registered under the Act and applicable state securities laws or unless
exemptions from such registration requirements are available;
c. that the Undersigned must bear the economic risks of the investment for an
indefinite period of time because the securities have not been registered under
the Act or any state securities laws;
d. that the Company is the only entity which may register its securities under
the Act and that the Company has not made any representations to the Undersigned
regarding the registration of the securities or compliance with Regulation A or
some other exemption under the Act;
e. that any and all certificates representing the securities, any securities
issued in replacement or exchange therefor, shall bear the following legend,
which the Undersigned has read and understands:
The Securities represented by this certificate have not been registered under
the Securities Act of 1933, as amended and may not be sold, transferred,
pledged, hypothecated or otherwise disposed of in absence of (i) an effective
registration statement for such securities under said act or (ii) under said act
or (iii) an opinion of the company counsel that such registration is not
required.
Furthermore, the securities represented by this certificate are subject to
repurchase at the Company's option, at book value, as determined by an
independent audit, if the individual shareholder is no longer employed by or
affiliated with Marina Capital Incorporated three years after the issue date of
this certificate.
f. that the Undersigned will not sell the securities being offered without
registration under the Act and any applicable state securities laws or unless
exemptions from such registration requirements are available, the availability
of which must be established to the satisfaction of the Company;
g. that the Company shall have the right to place stop transfer notations
on its books and to issue stop transfer instructions to any future transfer
agent to bar the transfer of any of the Undersigned's certificates except in
accordance with the Act; and
h. that the Undersigned is the sole party in interest as to his/her
participation in and commitment to the Company and is acquiring the shares
solely for investment for his/her own account and has no present agreement
understanding or arrangement to subdivide, sell, assign, transfer or otherwise
dispose of all or any part of his/her shares to any other person.
Initial: ( )
8. The Company has given the Undersigned the opportunity to ask questions
of and to receive answers from persons acting on the Company's behalf concerning
the terms and conditions of this offering and the status of the Company, and the
Undersigned has also been given the opportunity to obtain any additional
information to the extent the Company possesses the information or can acquire
it without unreasonable effort or expense necessary to verify the accuracy of
the information.
Initial: ( )
9. The Undersigned understands that the shares are not being registered
under the Securities Act of 1933, as amended (the "Act"), on reliance upon
exemptions contained in section 4(1), 4(2), 4(6) and/or 3(1)) of the Act and/or
the rules promulgated thereunder, as not involving any public offering, and the
shares are not being registered under any state securities laws. The
Undersigned is aware that the Company's reliance on such exemption is predicated
in part on the Undersigned representation and warranty that he/she is acquiring
such shares for investment for his/her own account, with no present intention of
dividing his/her participating with others or reselling or otherwise
distributing the same, as well as on other representations and warranties made
by the Undersigned which are included herein.
Initial: ( )
10. The Undersigned understands that other existing shareholders may have
paid a price per share for the Company substantially less than the price being
paid by the Undersigned.
Initial: ( )
11. The Undersigned is not affiliated with a member of the National
Association of Securities Dealers, Inc. (N.A.S.D.).
Subscriber Signature Accepted this 15th day of March 1999.
Print Name By:
Marina Capital, Inc.
Address
City, State, Zip
Phone Number
Social Security Number
Davis, James & Chase-Kraaima
Certified Public Accountants
Steven J. Davis, CPA, CFP PFS
Gordon H. James, CPA
Tarina Chase-Kraaima, CPA
Ann Singleton, CPA
May 19, 1999
To The Board of Directors of
Marina Capital, Inc.
Shupe-Williams Plaza
2605 Wall Avenue
Ogden, UT 84401
Re: Marina Capital, Inc.
Davis, James, and Chase-Kraaima, Certified Public Accountants, do hereby
consent to the use of the financial statements dated April 26, 1999, of
Marina Capital, Inc. to be used and filed in connection with the Form 10-SB
Registration Statement, as filed with the Securities and Exchange Commission.
/s/Davis, James, and Chase-Kraaima
Davis, James, and Chase-Kraaima
Certified Public Accountants
257 37th Street, Ogden, Utah 84405 TEL: (801) 399-5837 (801) 621-0721
FAX.. (801) 399-5830
WHEN RECORDED MAIL TO:
_____________________
_____________________
_____________________
_____________________________
SPACE ABOVE THIS LINE FOR RECORDER
ALL-INCLUSIVE TRUST DEED
With Assignment of Rents
THIS ALL-INCLUSIVE TRUST DEED MADE THIS 31st day of October, 1996, between
Marina Capital, Inc., as TRUSTOR, whose address is
Salt Lake City, Utah,
____________________________________________________________________________
(Street and Number) (City) (State)
The Home Abstract and Title Company, Inc., as TRUSTEE, *and John Sampson, acting
as qualified intermediary, as BENEFICIARY.
WITNESSETH: That Trustor CONVEYS AND WARRNATS TO TRUSTEE IN TRUST, WITH
POWER OF SALE, the following described property situated in Weber County, State
of Utah.
See Exhibit "A"
attached hereto and by this reference
made apart hereof.
Together with all buildings, fixtures and improvements hereon and all
water rights, rights of way, easements, rents, and issues, profits, income
tenements, hereditaments, privileges and appurtenances hereunto belonging, now
or hereafter used or enjoyed with said property, or any part hereof, SUBJECT,
HOWEVER, to the right, power and authority hereinafter given to and conferred
upon Beneficiary to collect and apply such rents, issues, and profits;
FOR THE PURPOSE OF SECURING (1) payment of the indebtedness evidenced by
an All-Inclusive Promissory Note (hereinafter the "Note") of even date herewith,
in the principal sum of $725,000.00, made by Trustor, payable to the order of
Beneficiary at the times, in the manner and with interest as therein set forth,
and any extensions and/or renewals or modifications thereof; (2) the
performance of each agreement of Trustor herein contained; (3) the payment of
such additional loans or advances as hereafter may be made to Trustor, or his
successors or assigns, when evidenced by a Promissory Note or Notes reciting
that they are secured by this Trust deed; and (4) the payment of all sums
expended or advanced by Beneficiary under or pursuant to the terms hereof,
together with interest hereon as herein provided.
This instrument is an All-Inclusive Trust Deed subject and subordinate
to the following instruments (hereinafter "Senior Encumbrances")"
(1) A Trust Deed/Mortgage recorded_______, as Entry No.___________,
in Book________ , at Page________ of Official Records of Weber, which, if a
Trust Deed secures a Promissory Note in the original principal amount of, or if
a Mortgage, is in the original principal amount of Five Hundred Thousand and
no/100th Dollars, ($500,000.00), dated Oct. 31st, 1996, in favor of DRMW
Development, Inc., Beneficiary/Mortgagee, with the Trustor/Mortgagor being
Maughan Family Partnership. If a Trust Deed, its Trustee is The Home Abstract
and Title Co., Inc.
(2) A Trust Deed/Mortgage recorded_______ , as Entry No.________ , in
Book_______, at Page________ of Official Records of________________,
which, if a Trust Deed secures a Promissory Note in the original principal
amount of, or if a Mortgage, is in the original principal amount of____ Dollars,
($_____), dated____, 19__, in favor of_________, Beneficiary/Mortgagee, with the
Trustor/Mortgagor being____________. If a Trust Deed, its Trustee is__________.
The Promissory Note(s) secured by said Trust Deed(s) is (are)
hereinafter referred to as the "Senior Note(s)"). Nothing in this Trust Deed,
the Note, or any deed in connection herewith shall be deemed to be an assumption
by the Trustor of the Senior Notes or Senior Encumbrances.
*NOTE: Trustee must be a member of the Utah State Bar, a bank, building and
loan association, savings and loan association, or insurance company authorized
to do such business in Utah; a corporation authorized to conduct a trust
business in Utah; a title insurance or abstract company authorized to do such
business in Utah, or a U.S. Government Agency.
_____________________________________________________________________________
This form has been approved by the Utah Real Estate Commission.
FORM NO 142-B
<PAGE>
TO PROTECT THE SECURITY OF THIS TRUST DEED, TRUSTOR AGREES:
1. To keep said property in good condition and repair; not to remove or
demolish and building thereon, to complete or restore promptly and in good and
workmanlike manner any building which may be constructed, damaged or destroyed
thereon; to comply with all laws, convenants and restrictions affecting said
property; not to commit or permit waste thereof; not to commit waste thereof;
not to commit, suffer or permit any act upon said property in violation of law;
to do all other acts which from the character or use of said property may be
reasonably necessary, the specific enumerations herein not excluding the
general; and, if the loan secured thereby or any part thereof is being obtained
for the purpose of financing construction of improvements on said property.
Trustor further agrees:
(a) To commence construction promptly and to pursue same with
reasonable diligence to completion in accordance with plans and specifications
satisfactory to Beneficiary, and
(b) To allow Beneficiary to inspect said property at all times
during construction.
Trustee, upon presentation to it of an affidavit signed by Beneficiary,
setting forth facts showing a default by Trustor under this paragraph, is
authorized to accept as true and conclusive all facts and statements therein,
and to act thereon hereunder.
2. To provide and maintain insurance, of such type or types and amounts
as Beneficiary may require, on the improvements now existing or hereafter
erected or placed on said property. Such insurance shall be carried on
companies approved by Beneficiary with loss payable clauses in favor of and in
form acceptable to Beneficiary. In event of loss, Trustor, shall give immediate
notice to Beneficiary, who may make proof of loss, and each insurance company
concerned is hereby authorized and directed to make payment for such loss
directly to Beneficiary instead of to Trustor and Beneficiary jointly, and the
insurance proceeds, or any part thereof, may be applied by Beneficiary, at its
option, to reduction of the indebtedness hereby secured or to the restoration or
repair of the property damaged.
3. To deliver to, pay for and maintain with Beneficiary until the
indebtedness secured hereby is paid in full such evidence of title as
Beneficiary may require, including abstracts of title or policies of title
insurance and any extensions or renewals thereof or supplements thereto.
4. To appear in and defend any action or proceeding purporting to
affect the security thereof, the title to said property, or the rights or powers
of Beneficiary or Trustee; and should Beneficiary or Trustee elect to also
appear in or defend any such action or proceeding, to pay all costs and
expenses, including cost of evidence of title and attorney's fees in a
reasonable sum incurred by Beneficiary or Trustee.
5. To pay all taxes, insurance and assessments of every kind or nature
as and when required by the Holders of Senior Encumbrances or when otherwise due
in absence of any requirements under the Senior Encumbrances.
6. Should Trustor fail to make any payment or to do any act as herein
provided, then Beneficiary or Trustee, but without obligation to do so and
without notice to or demand upon Trustor and without releasing Trustor from any
obligation hereof, may: Make or do the same in such manner and to such extent
as either may deem necessary to protect the security hereof, Beneficiary or
Trustee being authorized to enter upon said property for such purposes;
commence, appear in and defend any action or proceeding purporting to affect the
security hereof or the rights or powers of Beneficiary or Trustee; pay,
purchase, contest, or compromise any encumbrance, charge or lien which in the
judgment of either appears to be prior or superior hereto; and in exercising any
such powers, incur any liability, expend whatever amounts in its absolute
discretion it may deem necessary therefor, including cost of evidence of title,
employ counsel, and pay reasonable legal fees.
7. To pay immediately and without demand all sums expended hereunder by
Beneficiary or Trustee, with interest from date of expenditure at the rate borne
by the principal balance under the Note until paid, and the repayment thereof
shall be secured hereby.
IT IS MUTUALLY AGREED THAT:
8. Should said property or any part thereof be taken or damaged by
reason of any public improvement or condemnation proceeding, or damaged by fire,
or earthquake, or in any other manner, Beneficiary shall be entitled to all
compensation, awards, and other payments or relief therefor, and shall be
entitled at its option to commence, appear in and prosecute in its own name, any
action or proceedings, or to make any compromise or settlement, in connection
with such taking or damage. All such compensation, awards, damages, rights or
action and proceeds, including the proceeds of any policies of fire and other
insurance affecting said property, are hereby assigned to Beneficiary, who may,
after deducting therefrom all its expenses, including attorney's fees, apply the
same on any indebtedness secured hereby. Trustor agrees to execute such further
assignments of any compensation, award, damages, and rights of action and
proceeds as Beneficiary or Trustee may require.
9. At any time and from time to time upon written request of
Beneficiary, payment of its fees and presentation of this Trust Deed and the
note of endorsement (in case of full reconveyance, for cancellation and
retention), without affecting the liability of an persons for the payment of the
indebtedness secured hereby, Trustee may (a) consent to the making of any map or
plat of said property; (b) join in granting any easement or creating any
restriction thereon; (c) join in any subordination or other agreement affecting
this Trust Deed or the lien or charge thereof; (d) reconvey, without warranty,
all or any pat of said property. The grantee in any reconveyance may be
described as "the person or persons entitled thereto", and the recitals therein
of any matters or facts shall be conclusive proof of truthfulness thereof.
Trustor agrees to pay reasonable Trustee's fees for any of the services
mentioned in this paragraph.
10. As additional security, Trustor hereby assigns Beneficiary, during
the continuance of these trusts, all rents, issues, royalties, profits of the
property affected by this Trust Deed and of any personal property located
thereon. Until Trustor shall default in the payment of any indebtedness secured
hereby or in the performance of any agreement hereunder, Trustor shall have the
right to collect all such rents, issues, royalties, and profits earned prior to
default as they become due and payable. If Trustor shall have the right to
collect all such rents, issues royalties, and profits earned prior to default as
they become due and payable. If Trustor shall default as aforesaid, Trustor's
right to collect any of such moneys shall cease and Beneficiary shall have the
right, with or without taking possession of the property affected hereby, to
collect all rents, royalties, issues, and profits. Failure or discontinuance of
Beneficiary at any time or from time to time to collect any such moneys shall
not in any manner affect the subsequent enforcement by Beneficiary of the right,
power, and authority to collect the same. Nothing contained herein, nor the
exercise of the right by Beneficiary to collect, shall be, or be construed to
be, an affirmation by Beneficiary of any tenancy, lease or option, nor an
assumption of liability under, nor a subordination of the lien or charge of this
Trust Deed to any such tenancy, lease or option.
11. Upon any default by Trustor hereunder, Beneficiary may at any time
without notice, either in person, by agent, or by a receiver to be appointed by
a court (Trustor hereby consenting to the appointment of Beneficiary as such
receiver), and without regard to the adequacy of any security for the
indebtedness hereby secured, enter upon and take possession of said property or
any part thereof, in its own name sue or otherwise collect said
<PAGE>
rents, issues, and profits, including those past due and unpaid, and apply the
same, less costs and expenses of operation and collection, including reasonable
attorney's fees, upon any indebtedness secured hereby, and in such order as
Beneficiary may determine.
12. The entering upon and taking possession of said property, the
collection of such rents, issues and profits, or the proceeds of fire and other
insurance policies, or compensation or awards for any taking or damages of said
property, and the application or release thereof as aforesaid, shall not cure or
waive any default or notice of default hereunder or invalidate any act done
pursuant to such notice.
13. The failure on the part of Beneficiary to promptly enforce any
right hereunder shall not operate as a waiver of such right and the waiver by
Beneficiary of any default shall not constitute a waiver of any other or
subsequent default.
14. Time is of the essence hereof. Upon default by Trustor in the
payment of any indebtedness secured hereby or in the performance of any
agreement hereunder, all sums secured hereby shall immediately become due and
payable at the option of Beneficiary. In the event of such default, Beneficiary
may execute or cause Trustee to execute a written notice of default and of
election to cause said property to be sold t satisfy the obligations hereof, and
Trustee shall file such notice for record in each county wherein said property
or some part of parcel thereof is situated. Beneficiary also shall deposit with
Trustee, the note and all documents evidencing expenditures secured hereby.
15. After the lapse of such time as may then be required by law
following the recordation of said notice of default, and notice of default and
notice of sale having been given as then required by law. Trustee, without
demand on Trustor, shall sell said property on the date and at the time and
place designated in said notice of sale, either as a whole or in separate
parcels, and is such order as it may determine (but subject to any statutory
right of Trustor to direct the order in which property, if consisting of several
know lots or parcels, shall be sold), at public auction to the highest bidder,
the purchase price payable in lawful money of the United States at the time of
sale. The person conducting the sale may, for any cause he deems expedient,
postpone the sale from time to time, until it shall be completed and, in every
case, notice of postponement shall be given by public declaration thereof by
such person at the time and place last appointed for the sale; provided, if the
sale is postponed for longer than one day beyond the day designated in the
notice of sale, notice thereof shall be given in the same manner as the original
notice of sale. Trustee shall execute and deliver to the purchaser its Deed
conveying said property so sold, but without any covenant or warranty, express
or implied. The recitals in the Deed of any matters or facts shall be
conclusive proof of the trustfulness thereof. Any person, including
Beneficiary, may bid at the same. Trustee shall apply the proceeds of the sale
to payment of (1) the costs and expenses of exercising the power of sale and of
the sale, including the evidence of title procured in connection with such sale;
(2) all sums expended under the terms hereof, not then repaid, with accrued
interest at the rate borne by the principal balance under the Note from date of
expenditure; (3) all other sums then secured hereby; and (5) the remainder, if
any, to the person or persons legally entitled thereto, or the Trustee, in its
discretion, may deposit the balance of such proceeds with the County Clerk of
the county in which the sale took place.
16. Upon the occurrence of any default hereunder, Beneficiary shall have
the option to declare all sums secured hereby immediately due and payable and
foreclose this Trust Deed in the manner provided by law for the foreclosure of
mortgages on real property and beneficiary shall be entitled to recover in such
proceedings all costs and expenses incident thereto, including a reasonable
attorney's fee in such amount as shall be fixed by the court.
17. Beneficiary may appoint a Successor Trustee at any time by filing
for record in the office of the County recorder of each county in which said
property or some part hereof is situated, a substitution of Trustee. From the
time the substitution is filed for record, the new Trustee shall succeed to all
powers, duties, authority and title of the Trustee named herein or of any
Successor Trustee. Each such substitution shall be executed and acknowledged,
and notice thereof shall be given and proof thereof made, in the manner provided
by law.
18. This Trust Deed shall apply to, inure to the benefit of, and bind
all parties hereto, their heirs, legatees, divisees, administrators, executors,
successors and assigns. All obligations of Trustor hereunder are joint and
several. The term "Beneficiary" shall mean the owner and holder, including any
pledgee, of the note secured hereby. In this Trust Deed, whenever the contest
requires, the masculine gender includes the feminine and/or neuter, and the
singular includes the plural.
19. Trustee accepts this Trust when this Trust deed, duly executed and
acknowledged, is made a public record as provided by law. Trustee is not
obligated to notify any party hereto of pending sale under any other Trust deed
or of any action or proceeding in which Trustor, Beneficiary, or Trustee shall
be a party, unless brought by Trustee.
20. This Trust Deed shall be construed according to the laws of the
State of Utah.
21. The undersigned Trustor requests that a copy of any notice of
default and of any notice of sale hereunder be mailed to him at the address
hereinbefore set forth.
Signature of Trustor
Marina Capital, Inc. by
/s/Larry Walker-President
<PAGE>
EXHIBIT A
ALL-INCLUSIVE PROMISSORY NOTE SECURED BY
ALL-INCLUSIVE TRUST
(Installment Note, Interest Included)
$725,000.000 Ogden, Utah
October 31st, 1996
1. In Installments as herein stated, for value received, I/we Marina
Capital, Inc., hereinafter referred to as "Maker", promise to pay to John
Sampson, acting as qualified intermediary, hereinafter referred to as "Holder",
or order, at Ogden, Utah the sum of Seven Hundred Twenty Five Thousand and
00/100 Dollars ($725,000.00) with interest from Oct. 31, 1996 on unpaid
principal at the rate of eight $ 1/4 percent (8.25%) per annum, said principal
and interest being payable as follows:
Annual installments of $75,221.92 each, commencing
October 31, 1997 and continuing annually there after
until October 31, 2001, when the remaining principal
together with all accrued interest is due and payable.
A late payment penalty of five percent (5.0%) of any payment due shall be
assessed against the Maker if said payment has not been received by Holder
within ten (10) days of the due date. Each payment shall be credited first to
any late payments due, then to accrued interest doe and the remainder to
principal.
2. The total principal amount of this Note includes the unpaid principal
balance of any existing Promissory Note(s) ("Senior Note(s)") secured by Trust
Deed(s), or any Mortgages. Such Trust Deeds and Mortgage(s) are hereinafter
collectively referred to as "Senior Encumbrance(s)". The Senior Note(s) and/or
Mortgage(s) is/are more particularly describes as follows:
A. A Promissory Note/Mortgage in an original principal amount of
Five Hundred Thousand and 00/100 Dollars ($500,000.00) dated October 31st, 1996
in favor of DRMW Development, Inc. as Holder/Mortgagee, with the Maker/Mortgagor
being Maughan Family Partnership. There is an unpaid principal balance of
$500,000.00 as of October 31st, 1996, bearing interest at the rate of eight &
1/4 percent (8.25%) per annum payable $12,000.00 XXXXXX interest) Quarter. The
Quarterly payment.
includes taxes x does not include taxes.
B. (If applicable:) A Promissory Note/Mortgage in an original
principal amount of_____________Dollars ($______) dated______, 19 in favor of
as Holder/Mortgagee, with the Maker/Mortgagor being___________________. There
is an unpaid principal balance of $______ as of_____, 19__, bearing interest at
the rate of percent (__%) per annum payable $__________(principal and interest)
per month. The monthly payment.
includes taxes does not include taxes.
C. (If applicable:) A Promissory Note/Mortgage in an original
principal amount of_____________Dollars ($______) dated______, 19 in favor of
as Holder/Mortgagee, with the Maker/Mortgagor being___________________. There
is an unpaid principal balance of $______ as of_____, 19__, bearing interest at
the rate of percent (__%) per annum payable $__________(principal and interest)
per month. The monthly payment.
includes taxes does not include taxes.
3. Maker, at his option at any time, may prepay the amounts required
herein, provided, however:
A. Maker shall designate at the time the prepayment is made
whether the prepayment shall be credited to unpaid principal or in prepayment of
future installments due under this Note; and
B. In the event that Holder is required under the terms of this
Note or the All-Inclusive Trust Deed securing this Note, to make prepayments on
the Senior Note(s) as a direct result of any prepayment(s) on this note by
Maker, and Holder thereby incurs a prepayment penalty under the Senior Note(s),
then in such event, Maker agrees to pay to Holder, on demand, the full amount of
such prepayment penalty. Any prepayment penalties so paid by Maker shall not
reduce the unpaid balance of this Note.
_____________________________________________________________________________
This form has been approved by the Utah Real Estate Commission.
<PAGE>
4. When all the sums payable pursuant to the terms of this Note and the
All-Inclusive deed of Trust securing this Note have been paid in full, Holder
shall: (1) immediately pay all remaining sums to be paid under the terms of the
Senior Note(s) and Senior Encumbrance(s), and (2) surrender this Note to Maker
marked paid in full and execute and deliver to the Trustee a Request for Full
Reconveyance of the All-Inclusive trust Deed securing this Note.
5. Provided Maker is not in default under any terms of the Note or the
All-Inclusive deed of Trust securing this Note, Holder shall pay when due all
installments required under the terms of the Senior Note(s) and Senior
Encumbrance(s). In the event of any default by Maker under any terms of this
Note or the All-Inclusive Trust Deed securing this Note, Holder's obligation to
make payments on the Senior Note(s) shall be deferred until any such default is
cured. All penalties, charges and other expenses incurred under the Senior
Note(s) and the Senior Encumbrance(s) as a result of any such default by Maker
shall be added to the principal amount of this Note and shall be immediately
payable by Maker to Holder. Should Holder default in making any payment(s) on
the Senior Note(s) as required herein, Maker may make said payment(s) directly
to the Holder(s) of such Senior Note(s); any and all payments so made by Maker
shall be credited to this Note.
6. When all sums due pursuant to the terms of this Note and the All-
Inclusive Trust Deed securing this Note, at any time, is equal to or less than
the unpaid balance of principal and interest then due under the terms of the
Senior Note(s), then:
A. Upon (i) assumption by Maker of the Senior Note(s) and (ii)
release of Holder from all liabilities and obligations on the Senior Note(s) and
Senior Encumbrance(s), Maker at his option, may request and shall receive from
Holder, cancellation and delivery of this Note, and Holder shall execute and
deliver to the Trustee a Request for Full Reconveyance of the All-Inclusive
Trust deed securing this Note; or
B. Even in the absence of assumption and release under sub-
section A. above, Holder, at his option, may cancel this Note and deliver same
to Maker and execute and deliver to Trustee a request for Full Reconveyance of
the All-Inclusive Trust deed securing this Note; or
C. In the event neither Holder no Maker exercise the options
provided in A. and B. of this section, and this Note and the All-Inclusive Trust
deed securing this Note therefore remain in effect, then the payments and
interest rate shown in Section 1. Of this Note, to the extent they differ from
the Senior Note(s) shall immediately and automatically be adjusted to equal the
payments and interest rate then required under the Senior Note(s), and Maker, in
addition to such adjusted payments, shall also pay a monthly servicing fee to
Holder of an amount equal to n/s percent (n/a%) of such adjusted monthly
payments.
7. Holder shall have no further obligation under the terms of this Note
or the All-Inclusive Trust Deed securing this Note, after: (1) foreclosure by
Holder or his Trustee of the All-Inclusive Deed of Trust securing this Note, or
(2) delivery by Holder to Trustee of a Request for Reconveyance of the All-
Inclusive Trust Deed securing this Note.
8. In the event the Holder(s) of the Senior Note(s) is entitled to any
remedy pursuant to any due on sale, non-alienation, or non-assumption provision
as a result of the execution of this Note(s) and/or any document(s) related
hereto, the entire unpaid balance of this Note, without further notice, shall
become immediately due and payable thirty days following written notice to the
maker of this Note of the intent of the Holder(s) of the Senior Note(s) to
exercise any such remedy.
9. In the event that any payment under this Note is not made, or any
obligation provided to be satisfied or performed under this Note or the All-
Inclusive Trust deed securing this Note is not satisfied or performed at the
time and in the manner required. Holder at his option and without notice or
demand, may declare the entire principal balance, all amounts of accrued
interest and all other amounts then due under the terms of this Note and the
All-Inclusive Trust Deed securing this Note immediately due and payable.
10. In the event that any payment under this Note is not made, or any
obligation provided to be satisfied or performed under this Note or the All-
Inclusive trust Deed securing this Note is not satisfied or performed at the
time and in the manner required, the defaulting party shall pay any and all
costs and expenses (regardless of the particular nature thereof and whether or
not incurred in connection with the exercise of the power of sale provided for
the in All-Inclusive Trust Deed securing this note) which may be incurred by the
maker or Holder hereof in connection with the enforcement of any rights under
this Promissory Note, including, without limitation, court costs and reasonable
attorney's fees.
11. The Maker and endorser hereof waive presentment for payment,
protest, demand, notice of protest, notice of dishonor and notice of nonpayment
and expressly agree that this Note or any payment hereunder may be extended from
time to time by the Holder hereof without in any way affecting the liability of
such parties. No course of dealing between the maker and Holder in exercising
any rights hereunder, shall operate as a waiver of rights of Holder.
12. This Note shall inure to the benefit of and shall be binding upon
respective successors and assigns of the Maker and Holder.
13. This Note shall be construed in accordance with the laws of the
State of Utah.
14. In this Note, whenever the context requires, the masculine gender
includes the feminine and/or neuter, and the singular number includes the
plural.
15. This Note is secured by an All-Inclusive Trust Deed of even date
herewith.
Marina Capital, Inc by
_______________________ _______________________________
Maker Maker
/s/Larry R. Walker-President
_______________________ _______________________________
Maker Maker
The undersigned hereby accept(s) the foregoing All-Inclusive Promissory
Note and agree(s) to perform each and all of the terms thereof on the part of
the Holder to be performed.
Executed as of the date and place first above written.
______________________ _______________________________
Holder Holder
______________________ _______________________________
Holder Holder
<PAGE>
(If Trustor and Individual)
STATE OF UTAH
ss.
COUNTY OF__________________
On the________day of_____, 19__, personally appeared before
me _____________________ the signer(s) of the above instrument, who duly
acknowledged to me that__ he__ executed the same.
______________
NOTORY PUBLIC
My Commission Expires: Residing at:
__________________________________________
(If Trustor a Corporation)
STAE OF UTAH
ss.
COUNTY OF Weber
On the 13th day of November, 1996, personally appeared before me
Larry Walker who being by me duly sworn, says that he is the President of the
corporation that executed the above and foregoing instrument and that said
instrument was signed in behalf of said corporation by authority of its by-laws
(or by authority of a resolution of its board of directors) and said Larry
Walker acknowledged to me that said corporation executed the same.
/s/Anika Pickrell
______________________
NOTORY PUBLIC
My Commission Expires:
4/22/2000 Residing at:
Ogden, Utah
(Seal)
REQUEST FOR FULL RECONVEYANCE
(To be used only when indebtedness secured hereby has been paid in full)
TO: TRUSTEE
The undersigned is the legal owner and holder of the note and all other
indebtedness secured by the within Trust Deed. Said note, together with all
other indebtedness secured by said Trust Deed has been fully paid and satisfied;
and you are hereby requested and directed, on payment to you of any sums owning
to you under the terms of said Trust Deed, to cancel said note above mentioned,
and all other evidences of indebtedness secured by said Trust Deed delivered to
you herewith, together with the said Trust Deed, and to reconvey, without
warranty, to the parties designated by the terms of said Trust Deed, all of the
estate now held by you thereunder.
Dated________, 19__
____________________________
____________________________
Mail reconveyance to:
To the Shareho1ders and Board of Directors
Marina Capital, Incorporated
We have audited the accompanying balance Sheet of Marina Capital, Incorporated,
a Utah corporation, as of March 31, 1999 and the related statements of income,
retained earnings, and cash flows for the three months then ended. This
financial statement is the responsibility of the Company's management. Our
responsibility is to express an opinion an this financial statement based on our
audit.
We conducted our audit 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 statement. 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 audit provides 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 Marina Capital, Incorporated as
of March 31, 1999, and the results of it operations and its cash flows for the
three months then ended in conformity with generally accepted accounting
principles.
Davis, James and Chase-Kraaima
Certified Public Accountants
April 26, 1999
F-1
<PAGE>
MARINA CAPITAL, INCORPORATED
BALANCE SHEET
MARCH 31, 1999
ASSETS
Current Assets
Cash - checking $ 1,832
Investors Trust 272,467
Real Estate Trust 100
Shupe Williams Trust 19,000
Olympeak Trust 26,000
Accounts receivable 15,000
Deposits 220
Total Current Assets $ 334,619
Other Assets
Office equipment (Net) 3,989
Snowbasin land 1,122,989
Powder Mountain land 96,000
San Pete development 10,402
Shupe Williams building 190,009
Total Other Assets 1,423,389
Total Assets $1,758,008
LIABILITIES AND STOCKHOLDER'S EQUITY
Current Liabilities
Accrued interest $ 23,693
Accounts payable 918
Payroll taxes payable 9,043
Note payable - Maughan - current 17,951
Real Estate Trust Deposits 100
Shupe Williams Trust Deposits 19,000
Olympeak Trust Deposits 26,000
Total Current Liabilities 96,705
Long Term Liabilities
Note payable - Maughan 676,230
Total Long Term Liabilities 676,230
Total Liabilities 772,935
Stockholder's Equity
Common stock - 30,000,000 shares
$.001 par value authorized, 3,881,184
issued (Note 5) 1,924,674
Preferred stock - 5,000,000 shares
no par value authorized, 84,259 issued 220,778
Deficit Accumulated (1,160,379)
Total Stockholder's Equity 985,073
Total Liabilities and Stockholder's Equity $1,758,008
See accompanying notes and accountants' report.
F-2
<PAGE>
MARINA CAPITAL, INCORPORATED
STATEMENT OF INCOME
FOR THE THREE MONTHS ENDED MARCH 31, 1999
Revenue
Commission $ 7,975
Interest 1,270
Total Revenue 9,245
Operating expenses
Accounting 1,182
Advertising and promotion 110
Commissions 3,578
Dues and registrations 716
Interest and Bank fees 14,121
Legal 5,125
Office expenses 5,913
Miscellaneous 197
Rent 225
Taxes 5,993
Travel and entertainment 5,406
Telephone 2,013
Salaries 60,075
Insurance 3,588
Auto 6,954
Depreciation 114
Abandoned projects 15,000
Total operating expenses 130,310
Net loss from operations $(121,065)
See accompanying notes and accountants' report.
F-3
<PAGE>
MARINA CAPITAL, INCORPORATED
STATEMENT OF CHANGES IN STOCKHOLDER'S EQUITY
FOR THE THREE MONTHS ENDED MARCH 31, 1999
COMMON STOCK PREFERRED STOCK ACCUMULATED
DEFICIT
Balance 1-1-99 $1,663,676 $220,778 $(1,039,314)
Stock Issued 260,998 -- (121,065)
Balance 3-31-99 $1,924,674 $220,778 $(1,160,379)
See accompanying notes and accountants' report.
F-4
<PAGE>
MARINA CAPITAL, INCORAORATED
STATEMENT OF CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31, 1999
OPERATING ACTIVITIES
Net loss $(121,065)
Changes in operation assets and liabilities
Accounts receivable 0
Accounts payable and accrued expenses 6,502
Depreciation 114
Net cash used in operation activities (114,449)
INVESTING ACTIVITIES
Change in other assets (38,592)
Net cash used in investing activities (38,592)
FINANCING ACTIVITIES
Capital stock 260,998
Net cash provided in financing activities 260,998
Change in cash 107,957
Cash at beginning of year 166,342
Cash at end of year $274,299
SUPPLEMENTAL DISCLOSURES
Non-cash investing activities- None
Operating activities reflect
Interest $ 0
Taxes $ 0
See accompanying notes and accountants' report.
F-5
<PAGE>
MARINA CAPITAL, INCORPORATED
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 1999
NOTE 1 - SIGNIFICANT ACCOUNTING POLICIES
A. Nature of Business
The company was incorporated in Utah on March 5, 1996. The purpose of the
company is to invest in and develop various real estate and other business
opportunities. The company has several projects in various stages of
development.
B. Income Taxes
The company elected subchapter-S status at inception. This election has been
terminated as of January 1, 1997. There are no tax liabilities at this time, as
the company has loss carryovers of $807,936.
C. Accounting Methods
The company uses the accrual method of accounting. Development and organization
costs are capitalized and amortized or expensed according to generally accepted
accounting principles.
D. Use of Estimates
The preparation of financial statement5 in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
effect certain reported amounts and disclosures. Accordingly, actual results
could differ from these estimates.
NOTE 2 - RELATED PARTY TRANSACTIONS
The Company was organized by Richard V. Murray and Larry R. Walker. Salaries
and expense allowance totaling $50,000 have been paid to these individuals.
They are currently working to develop the company with compensation of $6,250
each month.
NOTE 3 - TRUST ACCOUNTS
The company has four trust accounts maintained at the Bank of Utah. The
Investor's Trust Account is where new investor moneys are deposited. Stock is
issued to investors. The Real Estate Trust account holds deposits and proceeds
of real estate brokerage transactions. The Shupe Williams Trust holds 19 $1,000
refundable deposits for investors interested in purchasing Condo units. The
Olympeak Trust holds money deposited on Olympeak lot sales. A liability account
has been set up for all but the investor deposits.
F-6
<PAGE>
MARINA CAPITAL, INCORPORATED
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 1999
NOTE 4 - NOTES PAYABLE
The company has the following notes outstanding:
Rate Current Long-Term Total
Maughan Family (1) 8.25% 17,951 676,230 694,181
1. Secured by Snowbasin Land - first position
5 year repayment schedule
1999 $ 17,951
2000 19,451
2001 656,779
$694,181
NOTE 5 - DEVELOPMENT COSTS
The Company has incurred development costs on various development projects.
These costs have been capitalized and will be expended when the related projects
are sold or abandoned. Total costs are $343,324.
NOTE 6- SHUPE WILLIAMS BUILDING DEVELOPMENT
Marina Capital, Incorporated has formed two Limited Liability Companies to own
and manage the Shupe Williams building project. The Shupe Williams building was
purchased by Shupe Williams Plaza, LLC. Shupe Williams Plaza, LLC is 100% owned
by Marina Holding, LLC. Marina Holding, LLC is 100% owned by Marina Capital,
Incorporated. Neither LLC has any other assets or liabilities other than the
Shupe Williams Building.
NOTE 7 - RESTRICTED STOCK
The Company has the following shares of stock outstanding:
Restricted Unrestricted Total
Common 3,701,284 179,900 3,881,l84
Preferred 84,259 - 84,259
NOTE 8 - CONTINGENT LIABILITIES
Ogden city Corporation and the Odgen Redevelopment Agency each hold a $250,000
trust deed note on the Shupe Williams Building and adjacent lot. Said notes
will be deemed satisfied upon sufficient completion of the project as specified
in the purchase agreement. The company is also subject to restrictioins on
transfer of the building.
F-7
To the Shareho1ders and Board of Directors
Marina Capital, Incorporated
We have audited the accompanying balance Sheet of Marina Capital, Incorporated,
a Utah corporation, as of December 31, 1998 and the related statements of
income, retained earnings, and cash flows for the three months then ended. This
financial statement is the responsibility of the Company's management. Our
responsibility is to express an opinion an this financial statement based on our
audit.
We conducted our audit 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 statement. 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 audit provides 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 Marina Capital, Incorporated as
of December 31, 1998, and the results of it operations and its cash flows for
the three months then ended in conformity with generally accepted accounting
principles.
Davis, James and Chase-Kraaima
Certified Public Accountants
February 4, 1999
F-1
PAGE>
MARINA CAPITAL, INCORPORATED
BALANCE SHEET
DECEMBER 31, 1998
ASSETS
Current Assets
Cash-checking $ 1,141
Cash in Trust 216,301
Accounts receivable 15,000
Deposits 220
Total Current Assets $ 232,662
Other Assets
Office equipment 4,101
Snowbasin land 1,122,989
Powder Mountain land 96,000
San Pete development 10,402
Shupe Williams building 151,417
Total Other Assets 1,384,909
Total Assets $1,617,571
LIABILITIES AND STOCKHOLDER'S EQUITY
Current Liabilities
Accrued interest $ 9,573
Accounts payable 16,576
Payroll taxes payable 1,001
Note payable - Maughan - current 17,951
Trust Deposits 51,100
Total Current Liabilities 96,201
Long Term Liabilities
Note payable - Maughan 676,230
Total Long Term Liabilities 676,230
Total Liabilities 772,431
Stockholder's Equity
Common stock - 30,000,000 shares
$.001 par value authorized, 3,815,118
issued (Note 5) 1,663,676
Preferred stock - 5,000,000 shares
no par value authorized, 84,259 issued 220,778
Deficit Accumulated in the development
stage (1,039,314)
Total Stockholder's Equity 845,140
Total Liabilities and Stockholder's Equity $1,617,571
See accompanying notes and accountants' report.
F-2
<PAGE>
MARINA CAPITAL, INCORPORATED
STATEMENT OF INCOME
FOR THE YEAR ENDED December 31, 1998
Revenue
Commission $ 3,642
Interest 2,874
Rent 2,100
Sale of Ski Inn land 15,000
Total Revenue 23,616
Operating expenses
Abandoned projects 1,781
Accounting 8,767
Advertising and promotion 9,679
Commissions 9,307
Consulting 5,765
Dues and registrtions 1,082
Interest and Bank fees 83,544
Legal 12,615
Office expenses 18,298
Miscellaneous 2,336
Rent 10,084
Taxes 20,778
Travel and entertainment 26,763
Telephone 15,460
Salaries 17,919
Insurance 5,645
Auto 20,436
Depreciation 456
Total operating expenses 424,715
Net loss from operations $(401,099)
See accompanying notes and accountants' report.
F-3
<PAGE>
MARINA CAPITAL, INCORPORATED
STATEMENT OF CHANGES IN STOCKHOLDER'S EQUITY
FOR THE YEAR ENDED DECEMBER 31, 1998
COMMON STOCK PREFERRED STOCK RETAINED EARNINGS
Balance 1-1-98 $ 853,111 $320,000 $ (638,215)
Stock Issued 810,565 (99,222) (401,099)
Balance 5-31-98 $ 1,663,676 $220,778 $(1,039,314)
See accompanying notes and accountants' report.
F-4
<PAGE>
MARINA CAPITAL, INCORAORATED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED DECEMBER 31, 1998
OPERATING ACTIVITIES
Net loss $(401,099)
Changes in operating assets and liabilities
Accounts receivable 181,102
Accounts payable and accrued expenses (69,846)
Depreciation 456
Net cash used from operating activities (289,387)
INVESTING ACTIVITIES
Sale of land 24,000
Change in other assets (145,438)
Net cash used in investing activities (121,438)
FINANCING ACTIVITIES
Principal payments on debt (142,919)
Capital stock 711,343
Net cash provided in financing activities 568,424
Change in cash 157,599
Cash at beginning of year 8,743
Cash at end of year $166,342
SUPPLEMENTAL DISCLOSURES
Non-cash investing activities- None
Operating activities reflect
Interest $ 83,544
Taxes $ 0
See accompanying notes and accountants' report.
F-5
<PAGE>
MARINA CAPITAL, INCORPORATED
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1998
NOTE 1 - SIGNIFICANT ACCOUNTING POLICIES
A. Nature of Business
The company was incorporated in Utah on March 5, 1996. The purpose of the
company is to invest in and develop various real estate and other business
opportunities. The company has several projects in various stages of
development.
B. Income Taxes
The company elected subchapter-S status at inception. This election has
been terminated as of January 1, 1997. There are no tax liabilities at
this time, as the company has loss carryovers of $815,471.
C. Accounting Methods
The company uses the accrual method of accounting. Development and
organization costs are capitalized and amortized or expensed according to
generally accepted accounting principles.
D. Use of Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that effect certain reported amounts and disclosures.
Accordingly, actual results differ from these estimates.
NOTE 2 - RELATED PARTY TRANSACTIONS
The Company was organized by Richard V. Murray and Larry R. Walker. Salaries
and expense allowance totaling $169,200 have been paid to these individuals.
They are currently working to develop the company with compensation of $6,250
each month.
F-6
<PAGE>
MARINA CAPITAL, INCORPORATED
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1998
NOTE 3 - NOTES PAYABLE
The company has the following notes outstanding:
Rate Current Long-Term Total
Maughan Family (1) 8.25% 17,951 676,230 694,181
1. Secured by Snowbasin Land - first position
5 year repayment schedule
1999 $ 17,951
2000 19,451
2001 656,779
$ 694,181
NOTE 4 - DEVELOPMENT COSTS
The Company has incurred development costs on various development projects.
These costs have been capitalized and will be expended when the related projects
are sold or abandoned. Total costs are $304,732.
NOTE 5 - SHUPE WILLIAMS BUILDING DEVELOPMENT
Marina Capital, Incorporated has formed two Limited Liability Companies to own
and manage the Shupe Williams building project. The Shupe Williams building was
purchased by Shupe Williams Plaza, LLC. Shupe Williams Plaza, LLC is 100% owned
by Marina Holding, LLC. Marina Holding, LLC is 100% owned by Marina Capital,
Incorporated. Neither LLC has any other assets or liabilities other than the
Shupe Williams Building.
NOTE 6 - CONTINGENT LIABILITIES
Ogden City Corporation and the Ogden City redevelopment Agency each hold a
$250,000 trust deed note on the Shupe Williams Building and adjacent lot. said
notes will be deemed satisfied upon sufficient completion of the project as
specified in the purchase agreement. The Company is also subject to
restrictions on transfer of the building.
F-7
To the Shareho1ders and Board of Directors
Marina Capital, Incorporated
We have audited the accompanying balance Sheet of Marina Capital, Incorporated,
a Utah corporation, as of December 31, 1997 and the related statements of
income, retained earnings, and cash flows for the year then ended. This
financial statement is the responsibility of the Company's management. Our
responsibility is to express an opinion an this financial statement based on our
audit.
We conducted our audit 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 statement. 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 audit provides 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 Marina Capital, Incorporated as
of December 31, 1997, and the results of it operations and its cash flows for
the year then ended in conformity with generally accepted accounting principles.
Davis, James and Chase-Kraaima
Certified Public Accountants
February 2, 1998
F-1
<PAGE>
MARINA CAPITAL, INCORPORATED
BALANCE SHEET
DECEMBER 31, 1997
ASSETS
Current Assets
Cash - checking $ (6,535)
Cash in Trust 17,377
Accounts receivable 15,000
Stock subscriptions receivable 103,222
Total Current Assets $ 129,064
Other Assets
Snowbasin land 1,115,949
Powder Mountain land 120,000
San Pete development 6,127
Shupe Williams building development 20,012
Other 1,840
Total Other Assets 1,263,928
Total Assets $1,392,992
LIABILITIES AND STOCKHOLDER'S EQUITY
Current Liabilities
Accured interest 55,641
Accounts payable 36,882
Payroll taxes payable 4,473
Note payable - Maughan - current 10,819
Trust deposits 2,100
Note payable - Hovey 54,000
Total Current Liabilities 163,915
Long Term Liabilities
Note payable - Maughan 694,181
Total Long Term Liabilities 694,181
Total Liabilities 858,096
Stockholder's Equity
Common stock - 30,000,000 shares $.001
par value authorized, 3,507,932
issued 853,111
Preferred stock - 5,000,000 shares no
par value authorized, 65,926 issued 320,000
Deficit Accumulated in the development
stage (638,215)
Total Stockholder's Equity 534,896
Total Liabilities and Stockholder's Equity $1,392,992
See accompanying notes and accountants' report.
F-2
<PAGE>
MARINA CAPITAL, INCORPORATED
STATEMENT OF INCOME
FOR THE YEAR ENDED DECEMBER 31, 1997
Revenue
Commission $ 56,530
Interest 515
Total Revenue 57,045
Operating expenses
Abandoned projects
Accounting 9,519
Advertising and promotion 1,559
Commissions 29,134
Consulting 71,332
Dues and registrtions 1,319
Interest and Bank fees 87,265
Legal 19,313
Office expenses 7,923
Miscellaneous 3,968
Rent 14,196
Taxes 17,350
Travel and entertainment 15,623
Telephone 8,266
Salaries 185,559
Insurance 8,415
Auto 17,820
Total operating expenses 498,561
Net loss from operations $(441,516)
See accompanying notes and accountants' report.
F-3
<PAGE>
MARINA CAPITAL, INCORPORATED
STATEMENT OF CHANGES IN STOCKHOLDER'S EQUITY
FOR THE YEAR ENDED DECEMBER 31, 1997
COMMON PREFERRED ACCUMULATED
STOCK STOCK DEFICIT
Balance 1-1-97 $133,134 $ 0 $(196,699)
Stock Issued 719,977 320,000 (441,516)
Balance 3-31-99 $853,111 $320,000 $(638,215)
See accompanying notes and accountants' report.
F-4
<PAGE>
MARINA CAPITAL, INCORAORATED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED DECEMBER 31, 1997
OPERATING ACTIVITIES
Net loss $(441,516)
Changes in operating assets and liabilities
Accounts receivable (188,776)
Accounts payable and accrued expenses 41,356
Net cash used in operation activities (588,936)
INVESTING ACTIVITIES
Change in other assets (252,902)
Net cash used in investing activities (252,902)
FINANCING ACTIVITIES
Note Payable (217,360)
Capital stock 1,039,976
Net cash provided in financing activities 822,616
Change in cash (19,222)
Cash at beginning of year 27,965
Cash at end of year $ 8,743
SUPPLEMENTAL DISCLOSURES
Non-cash investing activities- None
Operating activities reflect
Interest $ 0
Taxes $ 0
See accompanying notes and accountants' report.
F-5
<PAGE>
MARINA CAPITAL, INCORPORATED
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1997
NOTE 1 - SIGNIFICANT ACCOUNTING POLICIES
A. Nature of Business
The company was incorporated in Utah on March 5, 1996. The purpose of the
company is to invest in and develop various real estate and other business
opportunities. The company has several projects in various stages of
development.
B. Income Taxes
The company elected subchapter-S status at inception. This election has
been terminated as of January 1, 1997. There are no tax liabilities at
this time, as the company has loss carryovers of $438,372.
C. Accounting Methods
The company uses the accrual method of accounting. Development and
organization are capitalized and amortized or expensed according to
generally accepted accounting principles.
D. Use of Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that effect certain reported amounts and disclosures.
Accordingly, actual results could differ from these estimates.
NOTE 2 - RELATED PARTY TRANSACTIONS
The Company was organized by Richard V. Murray and Larry R. Walker. Salaries
and expense allowance totaling $169,200 have been paid to these individuals.
They are currently working to develop the company with compensation of $6,250
each month.
F-6
<PAGE>
MARINA CAPITAL, INCORPORATED
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1997
NOTE 3 - NOTES PAYABLE
The company has the following notes outstanding:
Rate Current Long-Term Total
Maughan Family (1) 8.25% 10,819 694,181 705,000
1. Secured by Snowbasin Land - first position
5 year repayment schedule
1998 $ 10,819
1999 17,951
2000 19,451
2001 656,779
$ 705,000
NOTE 4 - DEVELOPMENT COSTS
The Company has incurred development costs on various development projects.
These costs have been capitalized and will be expended when the related projects
are sold or abandoned. Total costs are $285,103.
NOTE 5- SHUPE WILLIAMS BUILDING DEVELOPMENT
Marina Capital, Incorporated has formed two Limited Liability Companies to own
and manage the Shupe Williams building project. The Shupe Williams building was
purchased by Shupe Williams Plaza, LLC. Shupe Williams Plaza, LLC is 100% owned
by Marina Holding, LLC. Marina Holding, LLC is 100% owned by Marina Capital,
Incorporated. Neither LLC has any other assets or liabilities other than the
Shupe Williams Building.
NOTE 6 - CONTINGENT LIABILITIES
Ogden City Corporation and the Ogden City Redevelopment Agency each hold a
$250,000 trust deed note on the Shupe Williams Building and adjacent lot. Said
notes will be deemed satisfied upon sufficient completion of the project as
specified in the purchase agreement. the Company is also subject to
restrictions on transfer of the building.
F-7
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0001027983
<NAME> MARINA CAPITAL, INC.
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> MAR-31-1999
<CASH> 319,399
<SECURITIES> 0
<RECEIVABLES> 15,220
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 334,619
<PP&E> 1,423,959
<DEPRECIATION> (570)
<TOTAL-ASSETS> 1,758,008
<CURRENT-LIABILITIES> 96,705
<BONDS> 676,230
0
220,778
<COMMON> 1,924,674
<OTHER-SE> (1,160,379)
<TOTAL-LIABILITY-AND-EQUITY> 1,758,008
<SALES> 9,245
<TOTAL-REVENUES> 9,245
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 116,189
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 14,121
<INCOME-PRETAX> (121,065)
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (121,065)
<EPS-BASIC> (.03)
<EPS-DILUTED> (.03)
</TABLE>
