SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-4/A
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
ROCKY MOUNTIAN POWER COMPANY
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
COLORADO 6500 84-0503585
(STATE OF INCORPORATION) (PRIMARY STANDARD (IRS EMPLOYER
INDUSTRIAL INDENIFICATION
CLASSIFICATION NUMBER)
CODE NUMER)
COMMISSION FILE NO. 333-88123
1358 5th Street Santa Monica CA 90401 (310) 823-8622
(Address of Principal Executive Offices) (Zip Code) (Telephone Number)
Shawn F. Hackman, Esq., 3360 W. Sahara, Suite 200, NV 89102
(Name and address of agent for service)
(702) 732-2253
(Telephone number, including area code, of agent for service)
The registrant hereby amends this registration statement on such date
or dates as may be necessary to delay its effective date until the
registrant shall file a further amendment which specifically states that
this registration statement shall thereafter become effective in accordance
with Section 8(a) of the Securities Act of 1933 or until the registration
statement shall become effective on such date as the Commission acting
pursuant to said Section 8(a), may determine.
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
As soon as practicable after the effective date
of this Registration Statement.
If any of the securities being registered on this Form are to be
offered in connection with the formation of a holding company and
there is compliance with General Instruction G, check the
following box. [ ]
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR
AMENDMENT. A REGISTRATION STATEMENT RELATING TO THESE SECURITIES
HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION. THESE
SECURITIES MAY NOT BE SOLD NOR MAY OFFERS TO BUY BE ACCEPTED
PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES EFFECTIVE.
THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF
THESE SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION
OR SALE WOULD BE UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION
UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
SUBJECT TO COMPLETION, DATED SEPTEMBER 30, 1999
<PAGE>
OFFER TO EXCHANGE
SHARES OF COMMON STOCK REGISTERED UNDER THE ACT, FOR ANY AND ALL
OUTSTANDING SHARES OF COMMON STOCK
WHICH HAVE NOT BEEN SO REGISTERED
OF
ROCKY MOUNTIAN POWER COMPANY
THE EXCHANGE OFFER WILL EXPIRE AT 5:00 P.M.,
PACIFIC STANDARD TIME, ON OCTOBER 6, 1999, UNLESS EXTENDED
ROCKY MOUNTIAN POWER COMPANY (the "Company") hereby offers,
upon the terms and subject to the conditions set forth in this
Prospectus (which constitutes the "Exchange Offer"), to exchange
of common stock of the Company (the "Shares").
SEE "RISK FACTORS" FOR A DISCUSSION OF CERTAIN FACTORS THAT SHOULD BE
CONSIDERED BY PARTICIPANTS IN THE EXCHANGE OFFER.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS, ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
The date of this Prospectus is September 30, 1999
<PAGE>
The Company has not entered into any arrangement or understanding
with any person to distribute the New Shares to be received in the
Exchange Offer, and to the best of the Company's information and belief,
each person participating in the Exchange Offer is acquiring the
New Shares in its ordinary course of business and has no arrangement or
understanding with any person to participate in the distribution of the
New Shares to be received in the Exchange Offer. Any person participating
in the Exchange Offer who does not acquire the Exchange Shares in the
ordinary course of business: (i) cannot rely on the above referenced
no-action letters; (ii) cannot tender its Old Shares in the Exchange Offer;
and (iii) must comply with the registration and prospectus delivery
requirements of the Securities Act.
There has not previously been any active public market for
the Shares. There can be no assurance that an active trading
market for the New Shares will develop.
AVAILABLE INFORMATION
The Company has filed with the Commission in Washington, D.C. a
Registration Statement on Form S-4 under the Securities Act with
respect to the Exchange Offer. This Prospectus, which is part of the
Registration Statement, does not contain all of the information set
forth in the Registration Statement and the exhibits and schedules thereto.
For further information With respect to the Company and the Exchange Offer,
reference is made to such Registration Statement and the exhibits and
schedules filed as part thereof.
The Company is subject to the information requirements of
the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
and in accordance therewith files reports and other information with the
Commission. The Registration Statement and the exhibits and schedules
thereto filed with the Commission may be inspected and copied without
charge at the Public Reference Section of the Commission at Room 1024,
Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549, and
will also be available for inspection and copying at the regional offices
of the Commission located at Seven World Trade Center, 13th Floor, New York,
New York 10048, and the Citicorp Center, 500 West Madison Street,
Suite 1400, Chicago, Illinois 60661. Copies of all or any portion of the
Registration Statement may be obtained from the Public Reference
Section of the Commission upon payment of certain prescribed
fees. Electronic registration statements made through the Electronic Data
Gathering, Analysis, and Retrieval system are publicly available through the
Commission's web site (http://www.sec.gov.), which is maintained by the
Commission and which contains reports, proxy and information statements
and other information regarding registrants that file electronically
with the Commission.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents previously filed with the Commission
by Rocky Mountain Power Company (File No. 333-88123) or MPEG
Super Site, Inc. (File No. 000-24869) pursuant to the Exchange
Act are incorporated by reference in this Prospectus: (i) ROCKY's
Annual Report on Form 10-K for the year ended December 31, 1998;
and (ii) MPEG's 10-Q for the Quarter ending June 30, 1999.
In addition, all documents filed by ROCKY or MPEG with the
Commission pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange
Act after the date and prior to the termination of the Exchange Offer
contemplated hereby shall be deemed to be incorporated by reference
herein and shall be a part hereof from the date of filing of such
documents. Any statement contained in a document incorporated by reference
herein or contained in this Prospectus shall be deemed to be modified or
superseded for purposes of this Prospectus to the extent that a statement
contained herein (or in any other subsequently filed document which also
is incorporated by reference herein) modifies or supersedes
such statement. Any statement so modified or superseded shall not
be deemed to constitute a part of this Prospectus, except as so modified or
superseded.
THIS PROSPECTUS INCORPORATES DOCUMENTS BY REFERENCE WHICH ARE
NOT PRESENTED HEREIN OR DELIVERED HEREWITH. COPIES OF SUCH DOCUMENTS
(OTHER THAN EXHIBITS TO SUCH DOCUMENTS, UNLESS SUCH EXHIBITS ARE SPECIFICALLY
INCORPORATED BY REFERENCE) ARE AVAILABLE, WITHOUT CHARGE, TO ANY PERSON, ON
WRITTEN OR ORAL REQUEST, FROM ROCKY MOUNTIAN POWER COMPANY, 1358 5th STREET,
SANTA MONICA, CALIFORNIA 90401, TELEPHONE NUMBER (310) 823-8622;
ATTENTION: RANDALL J. LANHAM, ESQ., VICE PRESIDENT and GENERAL COUNSEL.
SUMMARY
THE FOLLOWING SUMMARY INFORMATION IS QUALIFIED IN ITS ENTIRETY BY,
AND SHOULD BE READ IN CONJUNCTION WITH, THE FINANCIAL STATEMENTS AND
THE MORE DETAILED INFORMATION INCLUDED ELSEWHERE IN THIS PROSPECTUS.
UNLESS THE CONTEXT REQUIRES OTHERWISE, REFERENCES TO THE "COMPANY" MEAN
ROCKY MOUNTIAN POWER COMPANY AND ITS SUBSIDIARIES.
THE COMPANY
GENERAL
ROCKY MOUNTIAN POWER COMPANY
The Company's principal executive offices are located at
1358 5TH Street, Santa Monica, California 90401. The Company's
telephone number is (310) 823-8622.
THE EXCHANGE OFFER
Securities Offered.......... Up to 13,390,000 shares of
registered common stock for
13,900,000 shares of unregistered
common stock of Rocky Mountain
Power Company. See "Description of Shares."
The Exchange Offer.......... The Company is offering to exchange 13,390,000
shares of registered common stock for
13,900,000 shares of unregistered
common stock of Rocky Mountain Power Company
Federal Income Tax
Considerations............. The Exchange Offer will not result in any
income, gain or loss to the holders of Shares
or the Company for federal income tax
purposes. See "Federal Income Tax
Considerations."
Use of Proceeds............. There will be no proceeds to the Company from
the exchange of New Shares for the Old Shares
pursuant to the Exchange Offer.
Exchange Agent.............. Shawn F. Hackman, Esq. is serving as exchange
agent (the "Exchange Agent in connection with
the Exchange Offer.
CONSEQUENCES OF EXCHANGING OR FAILURE TO
EXCHANGE OLD SHARES PURSUANT TO THE EXCHANGE OFFER
Generally, holders of Old Shares (other than any holder who
is an "affiliate" of the Company within the meaning of Rule 405 under
the Securities Act) who exchange their Old Shares for New Shares pursuant
to the Exchange Offer may offer their New Shares for resale, resell their
New Shares, and otherwise transfer their New Shares without compliance
with the registration and prospectus delivery provisions of the Securities
Act, provided such New Shares are acquired in the ordinary course of the
Holder's business, such holders have no arrangement with any person to
participate in a distribution of such New Shares and neither the holder
nor any other person is engaging in or intends to engage in a distribution
of the New Shares. A broker-dealer who acquired Old Shares directly from
the Company cannot exchange such Old Shares in the Exchange Offer. Each
broker-dealer that receives New Shares for its own account in
exchange for Old Shares must acknowledge that it will deliver a
prospectus in connection with any resale of its New Shares. See "Plan of
Distribution." To comply with the securities laws of certain jurisdictions,
it may be necessary to qualify for sale or register the New Shares prior
to offering or selling such New Shares. Upon consummation of the Exchange
Offer, holders that were not prohibited from participating in the Exchange
Offer and did not tender their Old Shares will not have any registration
rights with respect to such nontendered Old Shares, and accordingly, such old
Shares will continue to be subject to the restrictions on
transfer contained in the legend thereon. See "The Exchange Offer-
- -Consequences of Failure to Exchange."
SUMMARY DESCRIPTION OF THE SHARES
Issuer................... ROCKY MOUNTIAN POWER COMPANY
Securities Offered....... 13,900,000 shares of registered common stock
of Rocky.
RISK FACTORS
Prospective participants in the Exchange Offer should take into account
the specific considerations set forth under "Risk Factors" as well as the
other information set forth in this Prospectus. See "Risk Factors."
RISK FACTORS
THIS PROSPECTUS AND OTHER REPORTS AND STATEMENTS FILED BY
THE COMPANY FROM TIME TO TIME WITH THE COMMISSION (COLLECTIVELY,
"COMMISSION FILINGS") CONTAIN OR MAY CONTAIN FORWARD-LOOKING
STATEMENTS, SUCH AS STATEMENTS REGARDING THE COMPANY'S GROWTH
STRATEGY AND ANTICIPATED TRENDS IN THE INDUSTRIES AND ECONOMIES IN
WHICH THE COMPANY OPERATES. THESE FORWARD-LOOKING STATEMENTS ARE
BASED ON THE COMPANY'S CURRENT EXPECTATIONS AND ARE SUBJECT TO A
NUMBER OF RISKS, UNCERTAINTIES AND ASSUMPTIONS RELATING TO THE COMPANY'S
OPERATIONS AND RESULTS OF OPERATIONS, COMPETITIVE FACTORS, SHIFTS IN MARKET
DEMAND, AND OTHER RISKS AND UNCERTAINTIES, INCLUDING IN ADDITION TO THOSE
DESCRIBED BELOW AND ELSEWHERE IN THIS PROSPECTUS OR ANY COMMISSION FILING,
UNCERTAINTIES WITH RESPECT TO CHANGES OR DEVELOPMENTS IN SOCIAL, BUSINESS,
ECONOMIC, INDUSTRY, MARKET, LEGAL AND REGULATORY CIRCUMSTANCES AND
CONDITIONS AND ACTIONS TAKEN OR OMITTED TO BE TAKEN BY THIRD PARTIES,
INCLUDING THE COMPANY'S CONTRACTORS, CUSTOMERS, SUPPLIERS, COMPETITORS,
STOCKHOLDERS, LEGISLATIVE, REGULATORY AND JUDICIAL AND OTHER GOVERNMENTAL
AUTHORITIES. SHOULD ONE OR MORE OF THESE RISKS OR UNCERTAINTIES MATERIALIZE,
OR SHOULD THE UNDERLYING ASSUMPTIONS PROVE INCORRECT, ACTUAL RESULTS MAY
DIFFER SIGNIFICANTLY FROM RESULTS EXPRESSED OR IMPLIED IN ANY
FORWARD-LOOKING STATEMENTS MADE BY THE COMPANY IN THIS PROSPECTUS OR
ANY COMMISSION FILING. THE COMPANY DOES NOT UNDERTAKE ANY OBLIGATION
TO REVISE THESE FORWARD-LOOKING STATEMENTS TO REFLECT FUTURE EVENTS
OR CIRCUMSTANCES. IN ADDITION TO THE OTHER INFORMATION CONTAINED
IN THIS PROSPECTUS, PROSPECTIVE INVESTORS SHOULD CAREFULLY CONSIDER THE
FOLLOWING RISK FACTORS IN EVALUATING THE COMPANY AND ITS BUSINESS BEFORE
PARTICIPATING IN THE EXCHANGE OFFER.
CONSEQUENCES OF FAILURE TO EXCHANGE
Upon consummation of the Exchange Offer, holders of Old
Shares that did not tender their Old Shares will not have any
exchange rights under the Registration Rights Agreement with
respect to such nontendered Old Shares and, accordingly, such Old
Shares will continue to be subject to the restrictions on
transfer contained in the legend thereon. In general, the Old
Shares may not be offered or sold, unless registered under the
Securities Act and applicable state securities laws, except
pursuant to an exemption from, or in a transaction not subject
to, the Securities Act and applicable state securities laws.
Based on interpretations by the staff of the Commission with
respect to similar transactions, the Company believes that the New Shares
issued pursuant to the Exchange Offer may be offered for resale, resold and
otherwise transferred by any holder of such New Shares (other than any such
holder which is an "affiliate" of the Company within the meaning of Rule 405
under the Securities Act) without compliance with the registration and
prospectus delivery provisions of the Securities Act, provided that such New
Shares are acquired in the ordinary course of such holder's business, such
holder has no arrangement or understanding with any person to participate in
the distribution of such New Shares and neither the holder nor any other
person is engaging in or intends to engage in a distribution of the New
Shares. A broker-Dealer who acquired Old Shares directly from the Company
cannot exchange such Old Shares in the Exchange Offer. Each broker-dealer
that receives New Shares for its own account in exchange for Old Shares
must acknowledge that it will deliver a prospectus in connection with any
resale of its New Shares. This Prospectus, as it may be amended or
supplemented from time to time, may be used by a broker-dealer in connection
with resales of the New Shares received in exchange for the Old Shares
acquired by the broker-dealer as a result of market-making
activities or other trading activities. The Company has agreed
that it will make this Prospectus available to any broker-dealer
for use in connection with any such resale for a certain period
of time after the Exchange Date or, if earlier, until all
participating broker-dealers have so resold. See "Plan of
Distribution." The New Shares may not be offered or sold unless
they have been registered or qualified for sale under applicable
state securities laws or an exemption from registration or
qualification is available and is complied with. The Company is required,
under the Registration Rights Agreement, to register the New Shares in any
jurisdiction requested by the holders, subject to certain limitations.
EFFECTS OF THE ECONOMY ON THE COMPANY'S INTERNET BUSINESS
The Company's business is impacted by the economic factors
which affect the internet industry. When such factors adversely
affect the internet industry, they tend to reduce the overall
demand for internet sites and products. There can be no
assurance that economic and other factors which may affect the
internet industry will not have an adverse impact on the
Company's business, financial condition or results of operations.
GOVERNMENT REGULATION
The internet industry is highly regulated in the United
States by the FCC and in other country by similar agencies.
Further, there can be no assurance that new and more stringent
government regulations will not be adopted in the future or that
any such new regulations, if enacted, would not have a material
adverse effect on the Company's business, financial condition or
results of operations.
FLUCTUATIONS IN OPERATING RESULTS
The Company's operating results are affected by many factors, including
the timing of orders from large customers, the timing of expenditures to
purchase inventory in anticipation of future sales, the timing of
bulk inventory purchases. A large portion of the Company's operating
expenses are relatively fixed. Since the Company typically does
not obtain long-term purchase orders or commitments from its
customers, it must anticipate the future volume of orders based
upon the historic purchasing patterns of its customers and upon
its discussions with its customers as to their future
requirements. Cancellations, reductions or delays in orders by a
customer or group of customers could have a material adverse
effect on the Company's business, financial condition or results
of operations.
RELIANCE ON EXECUTIVE OFFICERS AND KEY EMPLOYEES
The continued success of the Company is dependent to a significant degree
upon the services of its executive officers and upon the Company's ability
to attract and retain qualified personnel experienced in the various
phases of the Company's business. The ability of the Company to operate
successfully could be jeopardized if one or more of its executive
officers were unavailable and capable successors were not found.
The Company does not maintain "key person" life insurance on the
lives of its executive officers. See "Management."
COMPETITION
The markets for the Company's product and services are extremely
competitive, and the Company faces competition from a number of
sources. Certain of the Company's competitors have substantially
greater financial and other resources than the Company. There can
be no assurance that competitive pressures will not materially
and adversely affect the Company's business, financial condition
or results of operations. See "Business--Competition."
ABSENCE OF A PUBLIC MARKET FOR THE SHARES
The New Shares will constitute a new issue of securitieswith no
established trading market. Accordingly, no assurance can be given that
an active public or other market will develop for the New Shares
or as to the liquidity of or the trading market for the New Shares. If a
trading market does not develop or is not maintained, holders of the
New Shares may experience difficulty in reselling the New Shares or
may be unable to sell them at all. If a market for the New Shares
develops, any such market may be discontinued at any time.
If a public trading market develops for the New Shares, future trading
prices of such securities will depend on many factors including, among other
things, prevailing interest rates, the Company's results of operations and the
market for similar securities.
THE EXCHANGE OFFER
PURPOSE AND EFFECT OF THE EXCHANGE OFFER
Based on no-action letters issued by the staff of the Commission to third
parties, the Company believes that the New Shares issued pursuant to the
Exchange Offer in exchange for Old Shares may be offered for resale, resold and
otherwise transferred by any holder of such New Shares (other than any such
holder which is an "affiliate" of the Company within the meaning of Rule 405
under the Securities Act) without compliance with the registration and
prospectus delivery provisions of the Securities Act, provided that such New
Shares are acquired in the ordinary course of such holder's business, such
holder has no arrangement or understanding with any person to participate in
the distribution of such New Shares and neither the holder nor any other person
is engaging in or intends to engage in a distribution of the New Shares. A
broker-dealer who acquired Old Shares directly from the Company can not exchange
such Old Shares in the Exchange Offer. Any holder who tenders in the Exchange
Offer for the purpose of participating in a distribution of the New Shares
cannot rely on such interpretations by the staff of the Commission and must
comply with the registration and prospectus delivery requirements of the
Securities Act in connection with any resale transaction. Each broker-dealer
that receives New Shares for its own account in exchange for Old Shares, where
such Old Shares were acquired by such broker-dealer as a result of market-making
activities or other trading activities, must acknowledge that it will deliver a
prospectus in connection with any resale of such New Shares. See "Plan of
Distribution."
TERMS OF THE EXCHANGE OFFER
Upon the terms and subject to the conditions set forth in
this Prospectus (which together constitute the Exchange Offer),
the Company will accept any and all Old Shares validly tendered
and not withdrawn prior to 5:00 p.m., Pacific Standard time, on
the Expiration Date (as defined herein). The Company will issue
a principal amount of New Shares in exchange for an equal principal
amount of outstanding Old Shares tendered and accepted in the Exchange
Offer. Holders may tender some or all of their Old Shares
pursuant to the Exchange Offer. The date of acceptance for
exchange of the Old Shares for the New Shares (the "Exchange
Date") will be the first business day following the Expiration
Date or as soon as practicable thereafter.
The terms of the New Shares and the Old Shares are
substantially identical in all material respects.
As of the date of this Prospectus, 13,390,000 of the Old
Shares are outstanding. This Prospectus, together with the Letter
of Transmittal, is being sent to all registered holders of Old
Shares. Holders of Old Shares do not have any appraisal or
dissenters' rights under state law or the Indenture in connection
with the Exchange Offer. The Company intends to conduct the
Exchange Offer in accordance with the provisions of the
applicable requirements of the Exchange Act, and the rules and
regulations of the Commission thereunder. Old Shares which are
not tendered and were not prohibited from being tendered for
exchange in the Exchange Offer will remain outstanding and
continue to be subject to transfer restrictions.
Upon satisfaction or waiver of all the conditions to the Exchange Offer,
on the Exchange Date the Company will accept all Old Shares properly tendered
and not withdrawn and will issue New Shares in exchange therefor.
For purposes of the Exchange Offer, the Company shall be deemed to have
accepted properly tendered Old Shares for exchange when, as and if the
Company had given oral or written notice thereof to the Exchange Agent.
The Exchange Agent will act as agent for the tendering holders for the
purposes of receiving the New Shares from the Company.
Holders who tender Old Shares in the Exchange Offer will not be
required to pay brokerage commissions or fees on, transfer taxes with respect
to the exchange of Old Shares pursuant to the Exchange Offer. The
Company will pay all charges and expenses, other than certain
applicable taxes described below, in connection with the Exchange
Offer. See "Fees and Expenses" below.
EXCHANGE AGENT
Shawn F. Hackman, Esq., has been appointed as Exchange Agent
of the Exchange Offer. Questions and requests for assistance,
requests for additional copies of this Prospectus or of the
Letter of Transmittal and should be directed to the Exchange
Agent addressed as follows:
By Registered or Certified Mail, by hand or by Overnight Courier:
Shawn F. Hackman, Esq.
Shawn F. Hackman, a P.C.
3360 West Sahara Avenue, Suite 200
Las Vegas, Nevada 89102
By Facsimile:
Shawn F. Hackman, Esq.
(702) 940-4006
Confirm by Telephone:
(702) 732-2253
DELIVERY TO AN ADDRESS OTHER THAN AS SET FORTH ABOVE OR TRANSMISSION OF
INSTRUCTIONS VIA FACSIMILE OTHER THAN AS SET FORTH ABOVE DOES NOT CONSTITUTE A
VALID DELIVERY.
FEES AND EXPENSES
The expenses of soliciting tenders will be borne by the Company. The
principal solicitation is being made by mail; however, additional solicitation
may be made by telegraph, telephone or in person by officers, regular employees
or agents of the Company and its affiliates.
The Company has not retained any dealer-manager in connection with the
Exchange Offer and will not make any payments to brokers, dealers
or others soliciting acceptances of the Exchange Offer. The Company,
however, will pay the Exchange Agent reasonable and customary fees
for its services and will reimburse it for its reasonable out-of-pocket
expenses in connection therewith and will pay the reasonable fees and
expenses of holders in delivering their Old Shares to the Exchange Agent.
The cash expenses of the Company to be incurred in connection with the
Company's performance and completion of the Exchange Offer will be paid by the
Company. Such expenses include fees and expenses of the Exchange Agent and
Trustee, accounting and legal fees and printing costs, among others.
The Company will pay all transfer taxes, if any, applicable to the
exchange of Old Shares pursuant to the Exchange Offer. If, however, certificates
representing New Shares or Old Shares for principal amounts not tendered or
accepted for exchange are to be delivered to, or are to be issued in the name
of, any person other than the registered holder of the Old Shares tendered, or
if tendered Old Shares are registered in the name of any person other than the
person signing, if a transfer tax is imposed for any reason other than the
exchange of Old Shares pursuant to the Exchange Offer, then the amount of
any such transfer taxes (whether imposed on the registered holder or any
other persons) will be payable by the tendering holder. If satisfactory
evidence of payment of such taxes or exemption therefrom is not submitted
the amount of such transfer taxes will be billed directly to such tendering
holder.
CONSEQUENCES OF FAILURE TO EXCHANGE
Upon consummation of the Exchange Offer, holders of Old Shares that were
not prohibited from participating in the Exchange Offer and did not tender
their Old Shares will not have any further exchange rights under the
with respect to such nontendered Old Shares and, accordingly,
such Old Shares will continue to be subject to the restrictions
on transfer contained in the legend thereon. In general, the Old
Shares may not be offered or sold, unless registered under the
Securities Act and applicable state securities laws, except
pursuant to an exemption from, or in a transaction not subject
to, the Securities Act and applicable state securities laws.
Based on interpretations by the staff of the Commission with respect
to similar transactions, the Company believes that the New Shares issued
pursuant to the Exchange Offer in exchange for Old Shares may be offered
for resale, resold and otherwise transferred by any holder of
such New Shares (other than any such holder which is an
"affiliate" of the Company within the meaning of Rule 405 under
the Securities Act) without compliance with the registration and
prospectus delivery provisions of the Securities Act, provided
that such New Shares are acquired in the ordinary course of such
holder's business, such holder has no arrangement or
understanding with any person to participate in the distribution
of such New Shares and neither the holder nor any other person is
engaging in or intends to engage in a distribution of the New
Shares. If any holder has any arrangement or understanding with
respect to the distribution of the New Shares to be acquired
pursuant to the Exchange Offer, the holder (i) could not rely on
the applicable interpretations of the staff of the Commission and
(ii) must comply with the registration and prospectus delivery
requirements of the Securities Act in connection with any resale
transaction. Each broker-dealer that receives New Shares for its
own account in exchange for Old Shares must acknowledge that it
will deliver a prospectus in connection with any resale of its
New Shares. See "Plan of Distribution." The New Shares may not be
offered or sold unless they have been registered or qualified for
sale under applicable state securities laws or an exemption from
registration or qualification is available and is complied with.
OTHER
Participation in the Exchange Offer is voluntary and holders should
carefully consider whether to accept. Holders of the Old Shares are urged to
consult their financial and tax advisors in making their own
decisions on what action to take.
Upon consummation of the Exchange Offer, holders of the Old Shares
that were not prohibited from participating in the Exchange Offer and
did not tender their Old Shares will not have any exchange rights with
respect to such nontendered Old Shares and, accordingly, such Old Shares
will continue to be subject to the restrictions on transfer
contained in the legend thereon.
The Company has not entered into any arrangement or understanding
with any person to distribute the New Shares to be received in the
Exchange Offer, and to the best of the Company's information and belief,
each person participating in the Exchange Offer is acquiring the New
Shares in it ordinary course of business and has no arrangement or
understanding with any person to participate in the distribution of the
New Shares to be received in the Exchange Offer. In this regard, the
Company will make each person participating in the Exchange Offer
aware (through this Prospectus or otherwise) that if the Exchange
Offer is being registered for the purpose of secondary resale, any holder
using the Exchange Offer to participate in a distribution of New Shares to
be acquired in the registered Exchange Offer (i) may not rely on the staff
position enunciated in Morgan Stanley and Co. Incorporated (available
June 5, 1999) and Exxon Capital Holdings Corporation (available May 13, 1988)
or similar letters and (ii) must comply with registration and prospectus
delivery requirements of the Securities Act in connection with a secondary
resale transaction.
ACCOUNTING TREATMENT
The New Shares will be recorded at the same carrying value
as the Old Shares as reflected in the Company's accounting
records on the Exchange Date. Accordingly, no gain or loss for
accounting purposes will be recognized by the Company. The expenses
of the Exchange Offer will be expensed over the term of the New Shares.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Rocky Mountain Power Co. (the "Company") was organized as a Colorado
corporation on September 30, 1958. The Company is principally in the
real estate ownership and rental business. The Company also invests
in mortgage notes receivable and certificates of purchase related
to real estate foreclosures. Certain statements in the Report are
forward-looking. Actual results of future events could differ
materially.
The following discussion of the financial condition and results of
operations of the Company relates to the three (3) months ended March
31, 1999 and 1998 and the nine (9) months ended March 31, 1999 and
1998, and should be read in conjunction with the financial statements
and notes thereto included elsewhere in this Report. The Companywas
a relatively inactive public shell corporation for the two years
preceding the business combination with Prime Rate Investment
Management Enterprises, Inc. (PRIME) effective March 31, 1997.
Since the controlling shareholders of PRIME control RMPC after the
business combination, the transaction was accounted for as a reverse
acquisition. The financial statements of PRIME are presented in
this filing since for accounting purposes PRIME is the acquiring
entity. Effective April 30, 1997, PRIME was merged into RMPC with Prime
Rate Income & Dividend Enterprises, Inc. (PRIDE), a wholly-owned
subsidiary of PRIME becoming a wholly-owned subsidiary of RMPC. PRIDE is
the operating company and RMPC is principally a holding company. The
Company has selected June 30 as its fiscal year end.
RESULTS OF OPERATIONS
Revenue for the three and nine month periods ended March 31, 1999
decreased from the three and nine month periods ended March 31, 1998
as follows:
1998 1999 Decrease
-------- -------- --------
Three Months Ended March 31, $144,584 $ 48,855 $ 95,729
Nine Months Ended March 31, $268,258 $136,799 $131,459
Revenue decreased principally due to gains recognized on
disposition of assets. Gains recognized totaled $82,809 for the nine month
period ended March 31, 1998 as compared to $2,800 for the nine month
period ended March 31, 1999. Revenue also decreased due to a change in
the Company's business whereby it no longer does property inspections.
The revenue for property inspections totaled $27,769 and $50,969
during the three and nine month periods ended March 31, 1998.
The Company had no income from property inspections during the three
and nine month periods ended March 31, 1999. Rent income during the
nine month period ended March 31, 1999 was $14,910 as compared to
$23,095 during the nine month period ended March 31, 1998, a decrease of
$8,385 due to a decrease in rental real estate owned.
Operating expenses were $58,785 during the three month period ended
March 31, 1998 as compared to $10,100 during the three month period
ended March 31, 1999. Operating expenses were $160,672 during the
nine month period ended March 31, 1998 as compared to $33,355 during
the nine month period ended March 31, 1999. Operating expenses
decreased principally due to the ground lease cost of the
Racquetball/Health Club facility which totaled $9,705 and $23,366
during the three and nine month periods ended March 31, 1998,
respectively, and due to the decrease in contract services paid
for property inspections.
Net income after provision for income taxes amounted to $23,847 during
the three month period ended March 31, 1999 as compared to $70,151
during the three month period ended March 31, 1998, a decrease of
$46,304.
Net income after provision for income for the nine month period ended
March 31, 1999 was $66,046 as compared to $87,581 during the nine
month period ended March 31, 1998, a decrease of $21,535.
LIQUIDITY AND CAPITAL RESOURCES
Working capital was $1,014,605 at March 31, 1999 as compared to
953,149 at June 30, 1998. The Company's stockholders' equity was
$2,086,095 at March 31, 1999 as compared to $2,016,549 at June
30, 1998. The increase in stockholders' equity related principally
to the net income recognized for the nine months ended March 31, 1999.
The Company has made no commitments that would require any
material increase in capital resources. The Company's financial condition
has not been affected by the modest inflation of the recent past.
The Company believes that future inflation, if any, would not
materially affect the results of operations, other than interest rates on
the line of credit which are based on a floating rate over prime
would be higher. Also the values and rental rates on the Company's real
estate could be affected by future inflation, in any.
The Company's operating results are affected by many factors, including
the timing of orders from large customers, the timing of expenditures to
purchase inventory in anticipation of future sales, the timing of
bulk purchases. A small portion of the Company's operating
expenses are relatively fixed. Since the Company typically does
not obtain long-term purchase orders or commitments from its
customers, it must anticipate the future volume of orders based
upon the historic purchasing patterns of its customers and upon
its discussions with its customers as to their future
requirements. Cancellations, reductions or delays in orders by a
customer or group of customers could have a material adverse
effect on the Company's business, financial condition and results
of operations.
As a result of the Merger with MPEG, the previous assets,
liabilities and subsidiaries have been spun out of Rocky.
As a result of the proposed Merger with MPEG, the Company will incur
certain charges relating primarily to the costs associated with the
completion of the Merger. These costs will be taken as incurred in quarters
prior to the completion of the Merger, with the balance incurred in the
fiscal quarter in which the Merger closes. The Company also believes that
the combination of the Company and MPEG will allow the combined entity to
receive the benefit of certain synergies.
The Company and MPEG are co-registrants of the Company's
Registration Statement on Form S-4 (file no. 333-88123), of which
this Prospectus forms a part. As a result, the Company and MPEG
will become subject to the informational requirements of the
Securities Exchange Act of 1934 (the "Exchange Act") upon the
effectiveness of the Registration Statement.
So long as the factors set forth in the paragraph immediately above
remain true and correct, under applicable SEC rules and regulations, the
Company believes that MPEG will not need to individually comply with the
reporting requirements of the Exchange Act, nor will the Company
have to include separate financial statements and other
disclosures concerning each of the Subsidiary Guarantors in its
Exchange Act reports.
BUSINESS
GENERAL
Rocky Mountain Power Co. (RMPC) is a corporation which was
formed under the laws of the State of Colorado on September 30, 1958. The
Articles of Incorporation of the Company authorize it to issue 100,000,000
shares of common stock with $.05 per share par value and 200,000 shares of
preferred stock with a par value of $25.00 per share.
RMPC has approximately 439 shareholders.
The RMPC common stock is traded on the NASDAQ Bulletin Board
under the symbol RMPC.
The principal executive offices of the Company are located
at 12835 E. Arapahoe Road, T-II, #110, Englewood, Colorado 80112, and the
Company's telephone number is (303) 792-2466.
The Company has selected June 30 as its fiscal year end.
RECENT DEVELOPMENTS
None.
DESCRIPTION OF BUSINESS
RMPC's wholly owned subsidiary Prime Rate Income & Dividend
Enterprises, Inc. (PRIDE), is principally in the real estate
investment business. PRIDE also is in the business of investing
in foreclosure sale real estate certificates of purchase in the
enver Metropolitan area. PRIDE acquires the certificates of
purchase by bidding at foreclosure sales. Under Colorado Statutes,
there is generally a minimum redemption period of seventy-five (75) days
whereby the property owner can redeem the foreclosed property by paying the
certificate of purchase balance bid price plus interest at the rate specified on
the mortgage note, plus reimbursement of certain costs and expenses incurred
by the holder of the certificate of purchase during the redemption period. If
the former property owner fails to redeem the property, then junior
lienholders have a right to redeem. If the property is not redeemed,
the holder of the certificate of purchase will be granted title to
the property. It is PRIDE's investment policy to invest in certificates
of purchase that have sufficient
equity such that it is likely that the property will be redeemed.
As of June 30, 1999 the Company had $906,464 invested in
mortgage notes receivable. The Company's investments in mortgage
loans are collateralized principally by deeds of trust on real estate
located primarily in Colorado, California and Arizona. As of
June 30, 1999, the Company had seven mortgage loans receivable
from one individual totaling approximately $87,243. The loans as a
percentage of value of the real estate collateral were approximately 90%
at the time of sale. The Company also had, as of June 30, 1999 17 mortgage
loans reciveable from another non-affiliated individual totaling
approximately $565,497. The second individual's loans as a
percentage of value of the real estate collateral were approximately 100% at
the time of sale but, as additional collateral for the loans receivable from
this individual, the Company has a junior lien on another property owned by
this individual. These mortgage loans to the two individuals are a material
concentration of credit risk.
THE MARKET OPPORTUNITY
The market opportunity for investments in foreclosure real
estate certificates of purchase varies depending upon such
factors as interest rates, general economic conditions and real
estate construction costs. The Company markets its real estate
generally through listings with real estate brokers.
COMPETITION
PRIME's real estate business is highly competitive. There are
thousands of real estate investors in the United States of America that are
investing in similar rental properties. The level of competition in the
acquisition, sale and renting of real estate properties is effected by
economic conditions in the area as well as interest rates available to
borrowers. PRIME's business of investing in certificates of purchase
is also highly competitive since there is open bidding allowed on all
real estate foreclosures. Typically at the foreclosure sales, there will
be between five and twenty individuals in attendance and between three
and seven actual bidders in addition to the foreclosing lenders bidding
on the properties collateralizing their loans.
EMPLOYEES
The Company has no full time employees. Mr. Michael L. Schumacher, the
Company's President, Mr. George A. Powell, the Company's Vice President and
Mr. James D. Phelps, the Company's Secretary devote approximately 25%, 50%
and 1% respectively, of their time to the Company's business. The real
estate properties are managed by various independent property management
companies.
DESCRIPTION OF PROPERTY
(a) PRIDE and RMPC currently use minimal office space and
facilities provided at no cost by the Company's President.
(b) PRIDE and its subsidiaries invest in real estate and
real estate mortgages primarily for rental and interest income.
By investing in real estate that provides current income plus the
opportunity of long-term capital gains, the Company is attempting
to realize reasonable current operating income plus a
potential hedge against long-term inflation. Historically residential
real estate values have appreciated at least equal to the inflation
rate, but there can be no assurance of future appreciation. The Company
has no limitations or policies on the percentage of assets which may be
invested in any one investment, or type of investment.
(1) The Company may invest in any type of real estate but
currently principally has investments in residential rental
houses. The Company also owns one residential condominium and
thirteen residential lots. The Company engages independent
property management companies to manage the rental properties.
The property management companies find tenants, collect the rent
and pay certain expenses on the Company's behalf and remit net
rent monthly to the Company. The Company has financed its real
estate acquisitions with its own capital plus assumption of
exsisting loans on properties or owner carry back loans on
properties. The Company has no limitation policy on the number
or amount of mortgages which may be placed on any one piece of
property. Appropriateness of real estate investments and related
financing decisions are determined by the officers of the
Company.
(2) The Company's investments in mortgage loans are principally
loans carried back on properties sold. Management has no current
plans to actively invest in mortgage loans other than those
related to properties sold by the Company.
(3) The Company has and may continue to provide carry back loans
on properties equal to 100% of the sales price of properties if
adequate additional collateral is provided.
(4) The Company currently has no investments and no plans to
invest in securities of or interests in persons primarily engaged
in real estate activities.
(c) As of June 30, 1999, the Company had no investments in
real estate which amounted to ten percent or more of the total
assets of the Company.
The Company has approximately $241,000 invested in other
real estate.
Generally summarized as follows:
Description
Three acres of land with a rental home on the property
located in Oakhurst, California, near Yosemite National Park.
This property is zoned for multiple family housing.
Thirteen residential lots located in Nebraska, Arkansas,
Florida and North Dakota:
$ 160,000
81,000
------------
$ 241,000
============
All of the above properties are free and clear of encumbrances.
The rental house has an annual lease. There are no options or contracts
related to the sale of any of the properties owned by the Company. There are no
plans for renovation, improvement or development of any of the properties
owned. The Company intends to hold the residential rental property for its
current income production and also for the possibility of long-term
capital gains. Management believes that all properties have adequate
insurance coverage. The residential rental property has had vacancies
of less than 5% during the last two years.
Legal Proceedings
RMPC is not party to any material legal proceeding, nor is the Company's
property the subject of any material legal proceeding.
Submission of Matters to a Vote of Security Holders
None during the year ended June 30, 1999.
GOVERNMENT REGULATION AND TRACEABILITY
The internet industry is highly regulated in the United States by
the FCC and in other country by similar agencies. Further, there can be
no assurance that new and more stringent government regulations
will not be adopted in the future or that any such new
regulations, if enacted, would not have a material adverse effect
on the Company's business, financial condition or results of
operations.
PROPOSED MERGER WITH MPEG
On September 24, 1999, the Company entered into the Merger
Ascquisition Agreement with MPEG. Pursuant to the Agreement,
upon consummation of the Merger Acquisition, MPEG will become a
wholly-owned subsidiary of the Company.
Pursuant to the Merger Agreement, at the effective time of
the Merger (the "Effective Time"), each share of MPEG Common
Stock outstanding immediately prior to the Effective Time will be
converted into the right to receive, and will be exchangeable for
one (1) share of the Company's Common Stock. Based on 13.390,000
shares of MPEG common stock outstanding at September 24, 1999 the
Company will issue 13,390,000 shares of its authorized but
unissued stock in the Merger which will represent 94% of the
total shares of Common Stock to be outstanding immediately
following the Merger.
Consummation of the Merger is subject to the satisfaction of
a number of conditions, including the approval of the Merger by
the shareholders of MPEG and the Company. In connection with the
execution of the Merger Agreement, holders of MPEG common stock
owning in excess of 51% of MPEG's outstanding common stock
entered into an agreement to vote their shares in favor of the
Merger. On the same date, shareholders of the Company holding in
excess of 51% of the Company's common stock entered into a voting
agreement to vote their shares in favor of the Merger.
The Company believes that the Merger will create a combined entity that
should help the Company achieve the strategic goals which it has established.
MANAGEMENT
BOARD OF DIRECTORS
The Articles of Incorporation and By-laws of the Company
presently provide for a Board of Directors.
NAME AGE POSITION(S)
Michael L. Schumacher 50 President and Director
George A. Powell 72 Vice President and Director
James D. Phelps 59 Secretary and Treasurer
Robert S. Benham 56 Director
Robert F. Moreland 58 Director
Norman L. Horsfield 74 Director
Peter Porath 68 Director
COMPENSATION OF DIRECTORS
There is no annual retainer fee for the directors.
Directors are entitled to reimbursement for costs related to
attendance at meetings and travel.
EXECUTIVE OFFICERS
The following list reflects the executive officers of the
Company, as of this date, the capacity in which they serve the Company,
and when they assumed office:
BUSINESS EXPERIENCE
Michael L. Schumacher has been a director and president of
RMPC since October 31, 1996. He also has been a director and
president of PRIME and its subsidiaries since inception, May 1, 1995.
Mr. Schumacher was previously, until 1995, a director and president
of Universal Capital Corporation and High Hopes, Inc., both public
reporting companies. Universal Capital Corporation was an inactive
public shell and High Hopes, Inc. was a real estate investment company
while Mr. Schumacher was serving as president and director. Mr. Schumacher
is the director and President of Schumacher & Associates, Inc., a certified
public accounting firm located in Englewood, Colorado that provides audit
services, principally to public companies on a national basis throughout
the U.S.A. Mr. Schumacher is a Certified Public Accountant, Certified
Management Accountant and an Accredited Financial Planning Specialist.
Mr. Schumacher has a bachelors degree in Business Administration with
a major in accounting from the University of Nebraska at Kearney and
a Masters in Business Administration from the University of Colorado.
George A. Powell has been a director and vice president of
RMPC since October, 1996. He also has been a director and vice
president of PRIME and its subsidiaries since October, 1996. Mr. Powell
was previously a director and president of Continental Investors Life, Inc.,
a public reporting insurance company. Since Mr. Powell's retirement from
the insurance business in 1988, he has been self-employed as a business
consultant.
James D. Phelps has been secretary of RMPC since 1992 and a
director since 1997. Mr. Phelps also serves as a board member on
the City of Englewood Police Pension Board. Mr. Phelps is temporarily
serving as president-treasurer of Mountain Specialists Limited and for
the past ten years has been self employed as a consultant/accountant for
various clients in the Denver metropolitan area.
Robert S. Benham has been a director of RMPC since 1996. Until 1994, Mr.
Benham served as a receiver for the State of Colorado, Division of Insurance,
for various insurance company receivership and liquidation proceedings. Mr.
Benham is currently a director and president of Robert S. Benham & Associates,
Inc. (DBA Bookworld, Inc.) in the rare and collectible book business in
Aurora, Colorado. Mr. Benham has a bachelors degree in accounting
and finance from the University of Denver. Mr. Benham previously was a
licensed real estate broker.
Robert F. Moreland has been a director of RMPC since 1989.
Mr. Moreland was also president of RMPC from 1992 through
October, 1996. Mr. Moreland is currently employed by the
State of Texas General Land Office. Mr. Moreland is a graduate
of Louisiana State University and Southern Methodist University
School of Law, and is a member of the Colorado and Texas state
bars.
Norman L. Horsfield has been a director of RMPC since 1982.
Mr. Horsfield has a degree from England in Electrical Engineering and has
retired as an electrical engineer with English Electric Corporation.
Peter Porath has been a director of RMPC since 1997. Mr.
Porath has a Bachelor's Degree from 1998. RIPON College and an L.L.B. degree
from DePaul University. Mr. Porath is currently President of Dunhill Sports,
a private company in the sports products industry. Mr. Porath was
previously President of Vacation Ownership Marketing, a real estate development
company. Mr. Porath also was previously Vice-president of Investment
Corporation of Florida, a real estate development company that developed the
City of Wellington, Florida and Palm Beach Polo Club.
FAMILY RELATIONSHIPS
There are no family relationships between or among any of
the directors and executive officers of the Company.
EXECUTIVE COMPENSATION
No executive compensation has been paid to any of the
officers and directors.
EMPLOYMENT AGREEMENTS
The company does not currently have any employment
agreements with any of its employees.
PRINCIPAL STOCKHOLDERS
The following table sets forth, as of the date of this Prospectus, certain
information regarding the the Company Common Stock, owned of record or
beneficially by (i) each person who owns beneficially more than 5% of the
outstanding the Company Common Stock; (ii) each of the the Company directors
and named executive officers; and (iii) all directors and executive officers of
the Company as a group. Unless otherwise specified, the address for each
beneficial owner is c/o ROCKY MOUNTIAN POWER COMPANY, 1358 5th Street,
Santa Monica, California 90401.
Name and Address Amount and Nature Percent
of Beneficial Holder of Beneficial Ownership
Michael L. Schumacher (1) 234,552 shares 38.520%
12835 E. Arapahoe, T-II, #110
Englewood, CO 80112
Terry and Susan R. Seipelt 52,959 shares 8.697%
11330 North Scioto Avenue
Oro Valley, AZ 85737
Jackie Sanders 68,304 shares 11.217%
1301 Electric Avenue
Seal Beach, CA 90740
Harold L. Morris (2) 132,548 shares 21.767%
3991 MacArthur Blvd. #100
Newport Beach, CA 92660
George A. Powell 1,284 shares 2.109%
Vice President and Director
7333 S. Fillmore Circle
Littleton, CO 80122
Norman L. Horsfield 1,128 shares 1.852%
Director
2567 Wilt Road
Fallbrook, CA 92028
James D. Phelps 410 shares .067%
Secretary and Director
4735 S. Kalamath Street
Englewood, CO 80110
Robert S. Benham 628 shares .103%
Director
9273 E. Eastman Place
Denver, CO 80231
Robert F. Moreland 469 shares .077%
Director
12 Parrot Trail
Round Rock, TX 78681
Peter Porath 335 shares .055%
Director
12773 Forest Hill Blvd. #209
Wellington, FL 33414
Officers and directors as a 238,806 shares 39.218%
group (1)
Michael L. Schumacher owns 628 shares individually. In addition, Mr.
Schumacher, President and Director of RMPC and his spouse Zona R.
Schumacher are the sole beneficiaries of the Schumacher & Associates, Inc.
Money Purchase Plan & Trust (Schumacher Plan) which owns 230,399 shares
of RMPC. Shares owned by the Schumacher Plan are considered to be
beneficially owned by Mr. Schumacher. Mr. Schumacher's beneficial
ownership also includes the following shares to be owned by certain
relatives of Mr. Schumacher:
Owner Relationship Number of Shares
Zona Schumacher Spouse 493
Jada Schumacher Daughter 512
Spencer Schumacher Son 512
Quinn Schumacher Son 512
Ralph and Alma Schumacher Parents 183
Roberta and Timothy Weiss Sister and her spouse 164
Constance and Gary Novak Sister and her spouse 164
Cynthia and Greg Becker Sister and her spouse 164
Katheryn and Ken Zeeb Sister-in-law and
her spouse 164
Lowell and Ginett Janssen Brother-in-law and
his spouse 329
Warren and Cathy Janssen Brother-in-law and
his spouse 164
Rachel and Charles Paprocki Sister-in-law and
her spouse 164
Total 3,525
Mr. Schumacher disclaims beneficial ownership of an additional 76,703
shares held by the Plan as collateral for promissory notes totaling
approximately $275,000 including accrued interest at June 30, 1999.
The promissory notes are nonrecourse, bear interest at 8% per annum and
are totally due January 6, 2000. Failure to collect the note balances
and accrued interest at that time would result in the Schumacher Plan
obtaining ownership of the 76,703 additional shares.
(2) Harold L. Morris individually owns 64,399 shares of RMPC. In
addition, Harold L. Morris and his spouse, Connie Morris are the sole
beneficiaries of the Harold L. Morris Profit Sharing Plan which owns
34,978 shares of RMPC. Applegates Landing I, a Harold L. Morris family
partnership owns 24,299 shares. Professional Investors, a Utah Limited
Partnership, of which Mr. Morris is a partner, owns 1,679 shares. Mr.
Morris' beneficial ownership also includes the following shares owned by
certain relatives:
Owner Relationship Number of Shares
Debra L. Morris Daughter 4,796
Gary A. Morris Brother 2,397
-----
Total 7,193
=====
Mr. Morris disclaims beneficial ownership of an additional 68,222 shares
held by Mr. Morris, or entities controlled by him, as collateral for
promissory notes, totaling approximately $251,000 including accrued
interest at June 30, 1999. The promissory notes are nonrecourse, bear
interest at 8% per annum and are totally due January 6, 2000. Failure
to collect the note balances and accrued interest would result in Mr.
Morris, or entities controlled by him, obtaining ownership of the
additional 68,222 shares.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
There are no relationships related transactions reportable
under this section.
DESCRIPTION OF OTHER INDEBTEDNESS
None.
MPEG SUPER SITE, INC.
BUSINESS
BUSINESS DESCRIPTION
MPEG Super Site, Inc. will provide a dynamic, comprehensive,
music website that will be the measuring stick for all future
websites. Utilizing the company's vast experience in the music
industry, MPEG Super Site, Inc will be an independent record
label on the internet, discovering, developing and promoting new
artists in all the major genres. MPEG Super Site, Inc. is
committed to signing the artists who have the ability to fulfill
the niche market of the Internet generation. By becoming a major
music portal and incorporating free downloadable music, providing
exclusive news, concert information and album reviews on today's
hottest musical acts, producing state of the art webcasts of
special events on a global scale and providing a forum for direct
interaction between artist and their fan base, into a website
that is sophisticated yet user friendly. MPEG Super Site, Inc.
is poised to redefine the way we purchase and listen to music
into the next millenium.
MPEG Super Site, Inc. will complement its internet
development with more traditional lines of business. A full
service management company, representing both new and established
musical artists, television and motion picture directors and
choreographers, songwriters, producers and celebrities. Film
production, MPEG Super Site, Inc. is currently evaluating several
production deals with high profile, established production
companies for both television and theatrical release. The
company is the exclusive booking agent for several major
properties in Las Vegas and Atlantic City. The company plans to
support the sales of music CD's via the internet with traditional
record distribution. The company is currently evaluating
opportunities with several international distributors.
MPEG Super Site, Inc. will fuel the increasing popularity of
events that are broadcast over the internet. Concerts via pay-
per-view webcasts are a natural fit. MPEG Super Site, Inc. is
currently evaluating complementary opportunities such as extreme
sports. Board sports such as snowboarding skateboarding and
surfing create a dynamic synergy with music, especially since the
demographics are similar. Ultimate fighting, the "No Holds
Barred" style competition is a special event that shows promise
for a pay per view webcast. MPEG Super Site, Inc. will offer
webcasts with family oriented themes as well as those that are
more adult oriented.
MISSION STATEMENT
MPEG Super Site, Inc., will be the comprehensive internet
record label. Providing the best quality content at a fair and
competitive price. MPEG Super Site, Inc. is positioning itself
to be a major player in the digital music revolution. And by
creating content in other related areas, it will truly be a super
site.
STRATEGIC ELEMENTS
ACCESSABILITY Via the world wide web, consumers can listen,
download and purchase music at their convenience,
24 hours a day.
IMMEDIATE Music, through traditional record labels, can take
months, sometimes years, before the consumer
becomes aware. With MPEG Super Site, Inc.,
exposure is instantaneous on a global scale.
COST EFFECTIVE The internet offers an effective vehicle to
promote and sell music at a much lower cost.
OPPORTUNITY MPEG Super Site, Inc. will offer its artists a
royalty structure that is dramatically more
favorable. The music will be supported with
effective marketing, advertising and promotion on
a global scale.
CONTENT MPEG Super Site, Inc. will offer exclusive music
news, interviews, video and audio on today's most
popular musical artists.
STRATEGIC ALLIANCES
Through vast industry relations and contacts, MPEG Super
Site, Inc. has the opportunity to secure and quickly establish
these entertainment products into the stream of commerce via the
Internet. The founders of MPEG Super Site, Inc. are instantly
recognized in the industry and will help MPEG Super Site, Inc.
quickly emerge as an important leader on the national and
international business scene.
COMPANY LOCATION
MPEG Super Site, Inc, will be headquartered in Santa Monica,
California. The area is home to numerous internet companies as
well as some of the most respected record companies in the
industry.
PRODUCTS
RECORD LABEL/WEBSITE
ECHOPOP. The Sound of a New Revolution. Free downloads of
songs from all musical genres; Rock, Alternative, Hip-Hop,
Country, Heavy Metal and Gospel. The consumer can come to the
site and listen to thousands of sample tracks. There is no doubt
that free music, sells music. The driving force behind all
successful websites is CONTENT. In addition to the music at
EchoPop, there will be exclusive interviews and articles, in both
text and real audio. Candid reviews from some of the most
respected critics in the industry, covering new albums and
concerts. As well as concert information. The concept of a
collaboration experience for the site is very important in
building the future music community. Anyone who can download
music can play along with the artists. This could mean the
creation of an entirely different music experience that would
allow the artist and fan to jam together. These sessions could
then be uploaded to a special section of the site and downloaded
by other fans and even the artist directly. It is the 1999
version of Karaoke, instead of singing in a bar you perform with
the group. Merchandise and Memorabilia will also be available
for sale at the site. The site will appeal to the most hardcore
music aficionado to the casual listener, there will be something
for everyone. Visit www.echopop.com now.
EXTREME SPORTS
Currently, the MPEG Super Site has a alliance with
www.skatesurfsnow.com, which is a major portal for extreme
sports. The MPEG Super Site and skatesurfsun.com are already
working together to create cross promotions to increase sales and
traffic for both sites. Through this alliances we expect to
route traffic to the MPEG Super Site. The demographics of the
extreme sport enthusiast and the music fan is similar creating an
obvious choice for cross marketing opportunities. Additionally,
MPEG Super Site, Inc. is currently in negotiations to produce a
series of "No Holds Barred" fighting tournaments. The initial
tournament is currently scheduled in Osaka,Japan early next year,
with more tournaments in the planning stages. The tournaments
will be offered through pay per view.
FILM
In the entertainment community family films/video and
children's programming has been a stronghold for consistent
revenue generating projects. Family/children audiences mean
repeat viewing as they can be shown year after year; on holidays
and to each new generation of children. Nickelodeon, for
example, launched in 1979 to a few hardy cable subscribers in
Buffalo, NY, Gotham and Columbus, OH. In 1985 the network went
24 hours with the launch of Nick at Nite. Today Nickelodeon is
seen in seen in some 73 million households in the US and has
established a presence in more that 100 countries. MPEG Super
Site is the natural progression from cable to the Internet.
Offering the American family real time viewing of wholesome
entertainment at the click of a mouse. The MPEG Super Site has
entered into a joint venture arrangement with a well know TV
personality/producer to produce films for this niche market.
Currently, MPEG Super Site, Inc. is in pre-production in a number
of projects that will be offered through the MPEG Super Site as
well as normal channels of distribution, such as theatrical
release, network television, cable television, video and DVD.
SPECIAL EVENTS
MPEG Super Site, Inc. is very close to finalizing an
exclusive New Year's Eve extravaganza featuring one of today's
hottest musical acts. This international star had a phenomenal
1999, winning multiple music awards and selling millions of CD's.
The show will kick-off the new millennium for one of Las Vegas'
newest five-star hotels. The show will be invitation only and
not available to the general public, but can be seen at MPEG
Super Site.
MANAGEMENT
Because of management's vast experience in the music and
entertainment industry, opportunities to guide a young artists
career or revamp a once successful career of a veteran artist
arise constantly. MPEG Super Site, Inc. will be very selective
on each and every endeavor. From special events to concert
tours, from movies to speaking engagements, MPEG has the
resources to provide the utmost professional representation in
the industry.
WEBCAST
Special Events, Concerts, Feature Films and Extreme Sports
will be the focus of MPEG Super Site, Inc.'s webcast schedule.
As the internet continues to explode at a rapid pace, and as
technology in real time audio and video become highly refined,
webcasts are going to be a snowball that you cannot stop.
Webcasts will do for the internet what cable did for television.
The public wants a choice, they want a variety of quality
entertainment.
COMPETITIVE ANALYSIS
There is no question that competition exists in internet
music. The criticism has been that the other companies do not
know the music industry. The management of MPEG Super Site, Inc.
has worked in all facets of the music industry, from production
to marketing to management to concert booking. MPEG Super Site,
Inc. executives have worked with many of the icons in the music
industry. Because of this lack of industry experience, many
artists on competing sites have been very critical. Complaining
that their songs have been downloaded thousands of times, but
have yet to sell a single CD. The poor results are due to
improper marketing or no marketing at all, a direct reflection of
lack of experience. Another criticism has been that these sites
are filled with poor music, that quantity above quality is the
mode of operation. MPEG Super Site, Inc., will combine its
industry relationships with a grass roots approach to bring only
quality music to its site and therefore not alienate its consumer
base.
MARKETING STRATEGY
MPEG Super Site, Inc.'s overall marketing strategy will be
to highlight the most comprehensive music website on the
internet, and to promote its availability, quality and clean
straight forward approach. Consumers will be reached through a
cost efficient advertising and promotion campaign that will
include; publications, radio, flyers, special events, local
newspapers and other websites. Music magazines and radio are
both a natural vehicle. Some of the magazines being considered
are Rolling Stone, RayGun and Spin.
Through all its complementary lines of business, cross
marketing opportunities are endless. MPEG Super Site, Inc. will
be able to enhance its marketing on the internet with live
performances in many of the predominate venues locally,
nationally and internationally.
In addition, with the direct link to the end user, MPEG
Super Site, Inc. will be able to gather an invaluable amount of
consumer information by utilizing both direct and indirect
research methodologies. The MPEG Super Site will be able to
provide management with a particular band's popularity, who is
its major demographic age group, that age groups buying power,
etc. This will enable the company to filter and find the right
acts to sign and promote online and eventually through more
traditional channels of distribution
PRICING STRATEGY
Standard Pricing for CD's available for purchase at the site
will be from $8.99 to $12.99. There will be a nominal charge for
shipping. For webcast pay per views, the price depends on the
event. The range of retail prices will be from $10 to $50.
Security and Payment. MPEG Super Site, Inc. will utilize
the latest in Internet technology to protect its customers.
Offering its viewers the ability to pay by any number of credit
cards over the Internet using encrypted codes and cybercash
security.
DISTRIBUTION STRATEGY
Distribution will be three-fold. Ecommerce via the internet
will be first. Next will be through traditional retail channels
such as; Tower Records, The Wherehouse, Best Buy and Wal Mart.
Additional distribution will be accomplished through special
events, live appearances and other promotional activities.
TECHNOLOGY
MP3 or Motion Picture Expert Group Level Three is currently
the most widely accepted compressed file, music format. There is
no risk that the music industry would regard online music as a
passing fad; it has already started exploiting the technology.
For example, Sony has planned to make more than four thousand
(4,000) albums available to download on demand in US stores.
Also, several of the major electronic manufacturers have
developed MP3 players, Sony, Sanyo and Diamond to name a few.
MPEG Super Site, Inc. is a content company, not a software or
technology company. Therefore maintaining the versatility and
flexibility to adapt to the ever changing technologies of the
world wide web.
Analog transmitting has not previously permitted an
exceptional real time viewing of TV quality picture. However,
with recent developments in technology a digital quality picture
may be viewed any where in the world, via satellite
transmissions. The advent of digital technology combined with
the Internet has introduced an era of low overhead/ low entry fee
broadcasting of real time programs. To accommodate expanded
channel capacity and meet the demands for Internet access, many
cable operators have been converting to fiber-optic lines. The
expansion in cable carrying capacity makes the entertainment
world easily accessible and possibilities boundless.
BOARD OF DIRECTORS
Name Age Position(s)
Joseph S. Muto 57 President and Director
Kunimitsu Misawa 44 Director
Bruce M. Tomiyama 39 Secretary, Treasurer and Director
MANAGEMENT
KUNIMITSU MISAWA
International entertainment expert with over twenty-one (21)
years experience in the business. As an executive with several
entertainment companies, Mr. Misawa has developed, promoted and
produced concerts, special events and TV specials. Mr. Misawa and
former partner legendary promoter Tom Hulett were responsible for
an assortment of music concerts and events at venues as large as
Japan's Tokyo Dome for leading artists such as Earth, Wind &
Fire. Mr. Misawa produced the Hiroshima Peace Concert, with
endorsements by the United Nations, Hiroshima City Council and
Hiroshima Prefecture and "Joint '90" a concert for UNICEF. In
addition, Mr. Misawa has produced Magic Specials featuring
Hollywood Legend Tony Curtis and "No Holds Barred"
fighting/sporting specials.
Over the past 10 years Mr. Misawa has been actively involved with
the ownership and operations of one of Southern California's most
prestigious recording studios in the business, the former CBS
Recording Studio. Currently the studio is known in the industry
as The Complex. Most recently, Mr. Misawa partnered with six-time
Grammy award winner, Maurice White to start "Magnet Vision", an
international record company and recording studio based in Santa
Monica, California. Mr. Misawa also co-developed the "Sweet CD-
ROM" magazine.
In addition to Mr. Misawa's multi faceted entertainment
background, he has also served as a committee member on the
Minamata environmental project headed by Mr. Hosokawa, the
Governor of the Kumanoto Prefecture and former Prime Minister of
Japan.
JOSEPH S. MUTO
Currently is Secretary, General Counsel, and a member of the
Board of Directors of Mikasa, Inc. a New York Stock Exchange
listed company. Mr. Muto received his Juris Doctor from Loyola
University School of Law, Los Angeles and advises Mikasa's
Executive Committee and other levels of management. Mr. Muto's
responsibilities and management include all legal aspects of
Mikasa's US and worldwide business. As a partner at Kelly Drye &
Warren in Los Angeles prior to joining Mikasa, Mr. Muto
represented domestic and multi-national manufacturing and
distribution companies, trading companies, banks and other types
of corporations in the United States, Asia and Europe. In
addition, he was lead partner for various public and private
financing, representing both lenders and borrowers; mergers and
acquisitions of foreign and domestic companies, including
Japanese, European and Canadian corporations; real estate
acquisition and development projects involving
industrial/commercial properties, hotels, as well as golf
courses, both in the US and Europe.
FRED M. MEYER
For over 10 years, Mr. Meyer has been involved in the music
industry with an emphasis in artist management, concert promotion
and event merchandising. Prior to joining the MPEG Super Site
team, Mr. Meyer was the founder and president of MGR
Entertainment, an artist management and event-merchandising firm.
Mr. Meyer was responsible for all day to day operations including
negotiating with record companies, publishing companies,
promoters and working with labels to create marketing,
advertising and publicity campaigns. In addition, MGR
Entertainment's merchandising division also handled the day to
day operations for international touring artists and fund raising
events, developed new products, forecasted pricing and
administered road operations. Prior to forming MGR Entertainment,
Mr. Meyer spent five years with Nederlander of California, a
world famous concert and theatre promoter. At Nederlander Mr.
Meyer's responsibilities included; deal structuring, talent
buying and marketing strategy for the Arrowhead Pond (Anaheim),
Greek Theatre (LA), Pantages Theatre (LA), Wilshire Theatre (LA),
Henry Fonda Theatre (LA) and various other theatres in the LA
area and surrounding regions.
BRUCE M. TOMIYAMA
For over 14 years, Mr. Tomiyama has held senior financial
executive positions in private industry. Most recently as Vice
President of Business Development for Gambit Entertainment, Inc.,
an international sales broker specializing in the entertainment
industry. Mr. Tomiyama was responsible for creating opportunities
between U.S. and Japan companies in the areas of multimedia,
television and commercial endorsements.
Prior to that, Mr. Tomiyama was Senior Vice President and a
Director of SNK Corporation of America, the U.S. subsidiary of
SNK Corporation, Osaka, Japan, A billion dollar manufacturer of
coin operated and consumer video games. Mr. Tomiyama was
responsible for all domestic operations including finance,
administration, sales, marketing and distribution. Mr. Tomiyama
was the Chief Financial Officer of Moskatel's Inc., a large
regional specialty retail chain. He was responsible for the day
to day operations of the company's corporate office and
distribution center. Mr. Tomiyama began his career with the
international accounting firm of Deloitte & Touche.
DEAN KUIPERS
Mr. Kuipers past includes Culture & Political Editor of Raygun
magazine, where he's written cover stories on Marilyn Manson,
David Bowie, Neil Young, Iggy Pop, Smashing Pumpkins, Cypress
Hill, the Rolling Stones and countless others. He is the co-
author with Doug Aitken of "I Am A Bullet" (Crown Publishing), a
nonfiction essay on the acceleration of global culture, available
Spring 2000. As author of the 1997 graphics/pop culture book, Ray
Gun Out Of Control (Booth-Clibborn Editions/Simon & Schuster
Editions), he worked with contributors Bowie, REM's Michael
Stipe, cyberpunk novelist William Gibson and the world's foremost
graphic designers. Features researched from his lifetime interest
in radical environmentalism, politics, art, and adventure have
appeared in Playboy, Rolling Stone, Interview, Outside, Spin,
I.D., i-D (London), Gear, LA Weekly, and many others. Mr. Kuipers
has made four acclaimed short films with director Doug Aitken,
and an extensive photo-text website collaboration called "Loaded
5x". His fiction is published in anthologies including Signs Of
Life (Manic D Press) and the Black Ice Anthology.
RANDALL J. LANHAM, ESQ.
Current Chairman of PacificTradingPost.com, Inc. (OTC BB: PTRD),
Mr. Lanham has been directly responsible for the launch and
maintenance of several start-up companies, including Internet
based retailers. Mr. Lanham is a business attorney is with
particular expertise in securities, licensing, contracts and
patent infringement as well as general corporate/business law.
Mr. Lanham has represented clients in numerous arbitration
proceedings before NASD. In addition, he has served as President
and CEO of a multi-million dollar corporation with direct
responsibilities for marketing and sales, strategic planning,
business operations as well as all legal matters.
EDDIE WENRICK
During Mr. Wenrick's diverse thirty year career in the
entertainment business he has served as Vice President of Epic
Records, Director of A&R for Columbia Records and Vice President
of New Business and Artist development for Jeff McCluskey and
Associates, America's foremost radio promotion and marketing
company. His experience also includes high profile successes in
the fields of multi-platinum artist management and concert
promotion. He has extensive experience in new business
development and corporate bundling.
WAYNE THOMPSON
As an innovative independent contractor and corporate
troubleshooter, Mr. Thompson focuses on both broad and
specialized facets of the entertainment business, including
artist management, corporate partnering, strategic alliances,
theatrical production, facility programming, tour booking and
corporate events.
TRANSFER AND EXCHANGE
A Holder may transfer or exchange Shares, the Registrar and
the Trustee may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents and the Company
may require a Holder to pay any taxes and fees required by law.
FEDERAL INCOME TAX CONSIDERATIONS
The following discussion summarizes all material United States federal
income tax consequences to U.S. Holders and Non-U.S. Holders of owning and
disposing of the Shares. Hereinafter, the terms "U.S. Holder" and "Non-U.S.
Holder" refer, respectively, to holders of Shares that are or are not
classified as United States persons for United States federal income and
estate tax purposes. A holder that does not know whether such holder is a
U.S. person or Non-U.S. person should consult their own tax advisor.
This discussion does not purport to deal with tax consequences arising
under the laws of any foreign, state or local jurisdiction. It is, based upon
the provisions of existing law on the date hereof, including, in particular,
the Internal Revenue Code of 1986, as amended (the "Code"), Treasury
regulations promulgated thereunder and other administrative and judicial
interpretations thereof, all of which are subject to change at any time, with
or without retroactive effect. This discussion is limited to initial purchasers
who hold the Shares as capital assets within the meaning of Section 1221 of the
Code.
This discussion also does not address the tax consequences
to Non-U.S. Holders that are subject to United States federal
income tax on a net basis on income realized with respect to a
Note because such income is effectively connected with the
conduct of a United States trade or business. Such Non-U.S.
Holders are generally taxed in a similar manner to U.S. Holders,
but certain special rules do apply. This discussion is for
general information only and does not address all of the tax
consequences that may be relevant to particular initial
purchasers in light of their circumstances or to certain types of
initial purchasers (such as certain financial institutions,
insurance companies, tax-exempt entities, dealers in securities
or persons who have hedged the risk of owning a Note). This
summary discusses the tax considerations applicable to the
initial purchasers of the Shares who purchase the Shares at their
"issue price" as defined in Section 1273 of the Code and does not
discuss the impact of ownership of the Shares on subsequent owners.
The Company has not sought a ruling from the Internal Revenue Service
("IRS") with respect to the matters discussed herein and there is no
assurance that the IRS will agree with this discussion or the conclusions
stated herein.
PROSPECTIVE PURCHASERS ARE URGED TO CONSULT THEIR OWN TAX
ADVISORS AS TO THE PARTICULAR TAX CONSEQUENCES TO THEM OF THE PURCHASE,
OWNERSHIP AND DISPOSITION OF THE SHARES, INCLUDING THE APPLICABILITY OF ANY
FEDERAL TAX LAWS OR ANY STATE, LOCAL OR FOREIGN TAX LAWS, AND ANY CHANGES (OR
PROPOSED CHANGES) IN APPLICABLE TAX LAWS OR INTERPRETATIONS THEREOF.
U.S. HOLDERS
GENERALLY. As used herein, the term U.S. Holder means a person who is
considered to be a U.S. resident for federal income tax purposes,
or a person who is considered to be domiciled in the U.S. for federal estate
and gift tax purposes. A person other than a U.S. Holder is referred to herein
as a Non-U.S. Holder.
DISPOSITION OF SHARES. In general, a U.S. Holder of a Note
will recognize gain or loss upon the sale, redemption, retirement or other
disposition of the Note measured by the difference between the amount of
cash and fair market value of other property received (except to the extent
attributable to the payment of accrued interest) and the U.S. Holder's
adjusted tax basis in the Note. A U.S. Holder's adjusted tax basis in a
Note generally will equal the cost of the Note to the U.S. Holder. With
respect to non-corporate U.S. Holders, the gain or loss on such disposition
of Shares will be a long-term capital gain or loss taxed if Shares
have been held at the time of such disposition as capital assets
for more than one year but not more than 18 months at a rate no
higher than 28% or if held more than 18 months at a rate no
higher than 20% and as a short-term capital gain or loss if the
Shares have been held for not more than 12 months.
NON-U.S. HOLDERS
GAIN ON DISPOSITION OF SHARES. A Non-U.S. Holder will not be subject to
United States federal income tax by withholding or otherwise on gain realized
on the disposition of a Note unless the gain is effectively connected with the
conduct of a trade or business by the Non-U.S. Holder in the United States.
EFFECTIVELY CONNECTED INCOME. To the extent that interest income or gain
on the disposition of Shares is effectively connected with the conduct of a
trade or business of the Non-U.S. Holder in the United States, such income will
be subject to United States federal income tax at the same rates generally
applicable to United States persons. Additionally, in the case of a non-U.S.
Holder which is a corporation, such effectively connected income may be subject
to the United States branch profits tax at the rate of 30%.
Effectively connected interest may be subject to withholding unless a
properly completed IRS Form 4224 is delivered to the payor.
ESTATE TAX. Shares held at the time of death by an individual Non-U.S.
Holder will not be subject to United States estate tax, provided that at such
time, (i) such Non-U.S. Holder did not actually or constructively own 10% or
more of the total combined voting power of all classes of stock of the Company
entitled to vote, and (ii) the Shares were not held in connection with such
Non-U.S. Holder's trade or business in the United States.
TREATIES. Applicable treaties between the United States and a country in
which a Non-U.S. Holder is a resident may alter the tax consequences described
above.
EXCHANGE OFFER
For federal income tax purposes, the exchange of Old Shares for New
Shares pursuant to the Exchange Offer will not result in recognition of gain
or loss by U.S. Holders of Shares.
PLAN OF DISTRIBUTION
Each broker-dealer that receives New Shares for its own account
pursuant to the Exchange Offer must acknowledge that it will deliver a
prospectus in connection with any resale of the New Shares. This Prospectus,
as it may be amended or supplemented from time to time, may be used by a
broker-dealer in connection with resales of New Shares received in exchange
for Old Shares acquired as a result of market-making activities or other
trading activities. The Company has agreed that it will make this prospectus
available to any broker-dealer for use in connection with any such resale for a
period of one year after the Expiration Date or until all participating broker-
dealers have so resold. Any such broker-dealer who intends to use this
Prospectus in connection with the resale of New Shares received in exchange for
Old Shares pursuant to the Exchange Offer must notify the Company, or cause
the Company to be notified, on or prior to the Expiration Date, that it is such
a broker-dealer.
The Company will not receive any proceeds from the issuance
of the New Shares offered hereby or from any sale of New Shares
by broker-dealers. New Shares received by broker-dealers for
their own account pursuant to the Exchange Offer may be sold from
time to time in one or more transactions in the over-the-counter
market, in negotiated transactions, through the writing of
options on the New Shares or a combination of such methods of
resale, at market prices prevailing at the time of resale, at
prices related to such prevailing market prices or negotiated
prices. Any such resale may be made directly to purchasers or to
or through brokers or dealers who may receive compensation in the
form of commissions or concession from any such broker-dealer
and/or the purchasers of any New Shares. Any broker-dealer that
resells New Shares that were received by it for its own account
pursuant to the Exchange Offer and any broker-dealer that
participates in a distribution of New Shares may be deemed to be
an "underwriter" within the meaning of the Securities Act, and
any profit on any resale of New Shares and any commissions or
concessions received by any such persons may be deemed to be
underwriting compensation under the Securities Act.
The Company has not entered into any arrangement or understanding
with any person to distribute the New Shares to be received in the
Exchange Offer, and to the best of the Company's information and belief,
each person participating in the Exchange Offer is acquiring the New
Shares in its ordinary course of business and has no arrangement or
understanding with any person to participate in the distribution of
the New Shares to be received in the Exchange Offer.
LEGAL MATTERS
The validity of the New Shares will be passed upon for the Company
by Shawn F. Hackman, Esq., attorney at law.
EXPERTS
The Company's consolidated financial statements included herein, to the
extent and for the periods indicated in their report, have been audited by
Miller and McCollom, independent certified public accountants, and are
included herein in reliance upon the authority of said firm as experts in
giving said report.
MPEG's consolidated financial statements included herein, to the
extent and for the periods indicated in their report, have been audited by
Kurt D. Saliger, independent certified public accountants, and are included
herein in reliance upon the authority of said firm as experts in giving said
report.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this Report to be signed on its behalf
by the undersigned, hereunto duly authorized.
MPEG SUPER SITE, INC.
Dated: September 30, 1999 By:/s/ Bruce M. Tomiyami
Bruce M. Tomiyami, Chief Financial
Officer, Treasurer Secretary
and Director
SPECIAL POWER OF ATTORNEY
The undersigned constitute and appoint Bruce M. Tomiyami his true
and lawful attorney-in-fact and agent with full power of
substitution, for him and in his name, place, and stead, in any
and all capacities, to sign any and all amendments, including
post-effective amendments, to this Form S-4 Registration
Statement, and to file the same with all exhibits thereto, and
all documents in connection therewith, with the Securities and
Exchange Commission, granting such attorney-in-fact the full
power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the
premises, as fully and to all intents and purposes as he might or
could do in person, hereby ratifying and confirming all that such
attorney-in-fact may lawfully do or cause to be done by virtue
hereof.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons
in the capacities and on the date indicated.
Signature Title Date
By:/s/ Bruce M. Tomiyami Chief Financial Officer September 30, 1999
Bruce M. Tomiyami Treasurer, Secretary and
Director
By:/s/ Joseph S. Muto President and Director September 30, 1999
Joseph S. Muto
By:/s/ Kunimitsu Misawa Director September 30, 1999
Kunimitsu Misawa
<PAGE>
EXHIBIT INDEX
Exhibit Description Method of
Number Filing
10 Share Exchange Agreement See Below
24.1 Form of opinion re: legality of common stock See Below
rendered by Shawn F. Hackman, a P.C., Attorney
at Law, and consent of counsel
24.2 Consent of Accountants See Below
25 Special Power of Attorney See
Signature Page
27 Financial Data Schedule See Below
<PAGE>
INDEX TO FINANCIAL STATEMENTS
ROCKY MOUNTAIN POWER CO.
AND CONSOLIDATED SUBSIDIARIES
FINANCIAL STATEMENTS
June 30, 1999 and 1998
Description Page
Report of Independent Certified Public Accountants F-2
Consolidated Financial Statements:
Consolidated Balance Sheets F-3
Consolidated Statements of Income F-4
Consolidated Statement of Changes in F-5
Stockholders' Equity
Consolidated Statements of Cash Flows F-6
Notes to Consolidated Financial Statements F-7 - F-11
F-1
<PAGE>
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
The Board of Directors
Rocky Mountain Power Co.
Englewood, CO 80112
We have audited the accompanying consolidated balance sheets of Rocky
Mountain Power Co. and Consolidated Subsidiaries as of June 30, 1999
and 1998, and the related consolidated statements of income, changes
in stockholders' equity and cash flows for the years ended June 30, 1999
and June 30,1998. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on
these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audits
to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles
used and significant estimates made by management, as well as evaluating
the overall financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.
In our opinion, the consolidated financial statements, referred to above,
present fairly, in all material respects, the financial position of Rocky
Mountain Power Co. and Consolidated Subsidiaries as of June 30, 1999 and
June 30, 1998, and the results of its operations, changes in stockholders'
equity and its cash flows for the years ended June 30, 1999 and June 30,
1998, in conformity with generally accepted accounting principles.
Miller and McCollom
Certified Public Accountants
7400 W. 14th Avenue
Lakewood, Colorado 80215
September 15, 1999
F-2
<PAGE>
ROCKY MOUNTAIN POWER CO.
AND CONSOLIDATED SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
ASSETS
------
June 30, June 30,
1999 1998
Current Assets:
Cash $ 445,158 $ 70,229
Certificates of purchase, real estate
foreclosures (Note 3) 197,247 799,801
Mortgage notes receivable, current
portion (Note 3) 111,108 301,574
Mortgage note receivable, related
party (Note 3) 139,079 139,079
Deferred income taxes receivable,
current (Note 5) 4,626 4,626
Sale proceeds receivable (Note 7) 246,500 -
Other 26,831 26,685
--------- ---------
Total Current Assets 1,170,549 1,341,994
Real estate, net of accumulated deprec-
iation of $5,500 at June 30, 1999 and
$4,000 at June 30, 1998 (Note 3) 234,817 244,317
Transportation equipment, net of
accumulated depreciation of $6,125
at June 30, 1999 and $3,125 at
June 30, 1998 8,875 11,875
Mortgage notes receivable, net of
current portion (Note 3) 795,356 814,010
Deferred income taxes receivable, net
of current portion (Note 5) 53,557 57,213
--------- ---------
TOTAL ASSETS $ 2,263,154 $ 2,469,409
========= =======
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable $ 8,158 $ 6,931
Notes payable, current portion (Note 2) 10,005 318,519
Income taxes payable (Note 5) 41,689 39,531
Deferred taxes payable, current
portion (Note 5) 2,104 1,621
Accrued expenses and other 24,598 22,243
------ -------
Total Current Liabilities 86,554 388,845
Deferred taxes payable,
long term (Note 5) 27,595 35,906
Notes payable, net of current
portion (Note 2) 18,872 28,109
------- -------
TOTAL LIABILITIES 133,021 452,860
------- -------
Stockholders' Equity:
Preferred stock, $25.00 par value,
200,000 shares authorized, none
issued & outstanding - -
Common stock, $.05 par value, 100,000,000
shares authorized, 608,917 shares issued
and outstanding at June 30, 1999 and
607,853 at June 30, 1998 30,446 30,393
Additional paid-in capital 1,614,435 1,610,988
Retained earnings 485,252 375,168
TOTAL STOCKHOLDERS' EQUITY 2,130,133 2,016,549
----------- -----------
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $ 2,263,154 $ 2,469,409
=========== ===========
The accompanying notes are an integral part of the financial statements.
F-3
<PAGE>
ROCKY MOUNTAIN POWER CO.
AND CONSOLIDATED SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
Year Ended YearEnded
June 30, June 30,
1999 1998
Revenue:
Rent income $ 7,960 $ 26,557
Interest income 150,261 157,838
Management fee income - 38,350
Gain on the sale of real estate 43,570 97,174
Other income 7,293 -
-------- --------
209,084 319,919
-------- --------
Expenses:
Property management fees 660 15,591
Rent - 28,219
Depreciation 4,500 12,250
Interest 3,163 47,401
Real estate taxes and insurance 3,677 9,079
Repairs and maintenance 229 5,101
Professional fees 28,119 21,487
Stock issued for services 3,500 12,386
Other 14,902 30,876
------ -------
58,750 182,390
------- -------
Net income before provision
for income taxes 150,334 137,529
------- -------
Provision for income taxes (Note 5):
Current 41,686 39,531
Deferred (1,436) (2,515)
------- -------
40,250 37,016
------- -------
Net income $ 110,084 $ 100,513
-------- --------
Per Share $ .18 $ .14
======== ========
Weighted Average Shares
Outstanding 608,917 721,364
======== ========
The accompanying notes are an integral part of the financial statements.
F-4
<PAGE>
ROCKY MOUNTAIN POWER CO.
AND CONSOLIDATED SUBSIDIARIES
CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
From June 30, 1997 through June 30, 1999
Common Stock Paid-in Retained
No./Shares Amount Capital Earnings Total
---------- ------ ------- ------- -------
Balance at June 30, 1997 $ 749,742 $ 37,487 $2,065,234 $274,655 $2,377,376
Common stock issued 3,873 194 12,192 - 12,386
Common stock cancelled (145,762) (7,288) (466,438) - (473,726)
Net income for the year
ended June 30, 1998 - - - 100,513 100,513
-------- ------- --------- ------- ---------
Balance at June 30, 1998 607,853 30,393 1,610,988 375,168 2,016,549
Common stock issued 1,064 53 3,447 - 3,500
Net income for the year
ended June 30, 1999 - - - 110,084 110,084
------- -------- --------- -------- ---------
Balance at June 30, 1999 608,917 $ 30,446 $1,614,435 $485,252 $2,130,133
======= ======== ========= ======== =========
The accompanying notes are an integral part of the financial statements.
F-5
<PAGE>
ROCKY MOUNTAIN POWER CO.
AND CONSOLIDATED SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
Year ended Year ended
June 30, June 30,
1999 1998
Cash Flows Operating Activities:
Net income $ 110,084 $ 100,513
Depreciation 4,500 12,250
Stock issued for services 3,500 -
Increase in income taxes payable 2,158 23,371
(Decrease) in deferred income
taxes payable (4,172) (2,515)
Increase in accounts payable and accrued
expenses 3,582 8,293
(Gain) on sale of assets - (78,947)
-------- -------
Net Cash Provided by Operating Activities 119,652 62,965
-------- -------
Cash Flows from Investing Activities:
(Increase) in sales proceeds receivable (246,500) -
Collection of (Investments in)
certificates of purchase 602,554 (233,224)
Collection of notes receivable 485,666 564,554
(Investment) in mortgage notes receivable (276,546) (255,240)
Disposition of real estate 8,000 37,877
Other (146) 154,273
-------- --------
Net Cash Provided by Investing Activities 573,028 268,240
-------- --------
Cash Flows from Financing Activities:
Common stock issued and additional
paid-in capital - 12,386
(Repayment) of notes payable (7,851) (1,282,793)
Loan from bank 2,565,004 -
(Repayment) of loan from bank (2,774,904) -
(Repayment) of loan from related party (100,000) (150,000)
--------- --------
Net Cash Provided by
Financing Activities (317,751) (1,420,407)
--------- ---------
Increase (decrease) in Cash 374,929 (1,089,202)
Cash, Beginning of Period 70,229 1,159,431
--------- ---------
Cash, End of Period $ 445,158 $ 70,229
========= ==========
Interest Paid $ 3,163 $ 47,401
========= ==========
Income Taxes Paid $ 42,846 $ 16,122
========= ==========
The accompanying notes are an integral part of the financial statements.
F-6
<PAGE>
ROCKY MOUNTAIN POWER CO.
AND CONSOLIDATED SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
June 30, 1999 and 1998
(1) Summary of Accounting Policies
This summary of significant accounting policies of Rocky
Mountain Power Co. (RMPC) and its wholly-owned subsidiary,
Prime Rate Income & Dividend Enterprises, Inc. (PRIDE) and
Birch Branch, Inc., and GAP Enterprises, Inc., wholly-owned
subsidiaries of PRIDE is presented to assist in understanding
the Company's financial statements. The financial statements
and notes are representations of the Company's management who
is responsible for their integrity and objectivity. These
accounting policies conform to generally accepted accounting
principles and have been consistently applied in the preparation
of the financial statements.
(a) Organization and Principles of Consolidation
The consolidated financial statements include the accounts of
the companies listed above. The Company is principally in the
real estate ownership and rental business. The Company also
invests in mortgage notes receivable and certificates of purchase
related to real estate foreclosures. All intercompany account
balances have been eliminated in the consolidation. The Company
has selected June 30 as its year end.
(b) Per Share Information
Per share information is based upon the weighted average number
of shares outstanding during the period.
(c) Investment in Real Estate and Related Depreciation
The Company's investments in rental real estate are carried at
cost, net of accumulated depreciation. Depreciation on rental
real estate is being computed using the straight-line method
over estimated useful lives of 40 years. Major renovations are
capitalized. Repairs and maintenance costs are expensed as
incurred.
(d) Use of Estimates in the Preparation of Financial Statements
The preparation of financial statements in conformity with
generally accepted accounting principles requires management to
make estimates and assumptions that affect the reported amounts
of assets and liabilities and disclosure of contingent assets
and liabilities at the date of the financial statements and the
reported amounts of revenue and expenses during the reporting
period. Actual results could differ from those estimates.
F-7
<PAGE>
ROCKY MOUNTAIN POWER CO.
AND CONSOLIDATED SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
June 30, 1999 and 1998
(1) Summary of Accounting Policies, Continued
(e) Geographic Area of Operations and Interest Rates
The Company owns properties principally in California, Nebraska,
North Dakota, Florida and Arkansas. The potential for severe
financial impact can result from negative effects of economic
conditions within the market or geographic area. Since the
Company's business is principally in four areas, this
concentration of operations results in an associated risk and
uncertainty.
(f) Provision for Deferred Income Taxes
Timing differences exist related to recognition of gains on sale
of real estate for income tax purposes and financial reporting
purposes. Income tax regulations allow the use of the
installment method for reporting sales of assets. The Company
has provided a deferred income tax provision for this timing
difference.
(2) Notes Payable
As of June 30, 1999 the Company had outstanding $28,877 on a
note payable bearing interest at 15%. Maturities of this note
payable is summarized as follows:
Year ending June 30,
2000 $ 10,005
2001 11,614
2002 7,258
2003 -
Thereafter -
Total $ 28,877
This note is due in monthly installments of $1,129 through
December, 2002. This note is not collateralized by any assets of the
Company. Also included in notes payable at June 30, 1998, was $209,900
payable to a bank collateralized by certain mortgage notes
receivable and certificates of purchase. This note was paid
in full during the year ended June 30, 1999. The terms of
the bank loan are more fully disclosed in Note 6. In
addition, the Company had a $100,000 note payable to a
shareholder which was uncollateralized and was paid in full
during the year ended June 30, 1999.
F-8
<PAGE>
ROCKY MOUNTAIN POWER CO.
AND CONSOLIDATED SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
June 30, 1999 and 1998
(3) Concentration of Credit Risk
The Company's material concentration of credit risk consists
principally of investments in mortgage loans and certificates of
purchase. The Company's investments in mortgage loans are
collateralized principally by first or second deeds of trust on
real estate located primarily in Colorado, Arizona and
California.
At June 30, 1999, the Company had seven mortgage loans receivable
from one individual totaling approximately $87,243. The loans as
a percentage of value were approximately 90% at the time of sale.
The Company also had seventeen mortgage loans receivable from
another individual totaling approximately $565,497. The second
individual's loans as a percentage of value were approximately
100% at the time of sale but, as additional collateral for the
loans receivable from this individual, the Company has a junior
lien on another property owned by this individual. The
weighted average interest rate on mortgagee notes receivable is
approximately 8% per annum with monthly repayment terms being
amortized over periods up to twenty years.
The Company has one investment in a foreclosure certificate of
purchase totaling $197,247 as of June 30, 1999. This certificate
of purchase entitles the Company to receive interest at the
original foreclosed mortgage loan rate over the redemption
period, which is generally 75 days, or title to the property if not
redeemed within the redemption period. The interest rate on the
Company's investment in certificate of purchase was 30%.
Subsequent to June 30, 1999, the Company obtained title to the
property that was subject to the certificate of purchase.
Effective March 31, 1998, the Company sold its investment in
a health club/racquetball building to the shareholder that
originally contributed the property for stock. The gross
proceeds to the Company were 145,762 shares of the Company's
common stock and a mortgage note receivable of $139,079
collateralized by the property. This note bears interest at 8%
per annum and is totally due on March 31, 2000. The Company
recognized a gain on this sale of $78,947. The shares of stock
returned to the Company were recorded at net book value,
cancelled and returned to authorized but unissued stock.
F-9
<PAGE>
Financial instruments that potentially subject the Company to
concentrations of credit risk consist primarily of temporary
cash investments. The Company places its temporary cash
investments with financial institutions. As of June 30, 1999,
the Company had a concentration of credit risk since it had
temporary cash investments in bank accounts totalling $309,112
in excess of the FDIC insured amounts.
ROCKY MOUNTAIN POWER CO.
AND CONSOLIDATED SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
June 30, 1999 and 1998
(4) Fair Value Financial Instruments
As of June 30, 1999, the Company had various investments in
long term mortgage notes receivable and was obligated under
various mortgage notes payable. Management believes that the
fair value of these financial instruments does not materially
differ from the carrying value of these notes based upon
discounting at current market rates of interest.
(5) Income Taxes
A reconciliation between the expected income tax provision
computed at a federal statutory rate of 39% and the actual
income tax provision follows:
Year Year
Ended Ended
June 30, June 30,
1999 1998
Expected income tax $ 58,630 $ 53,636
Graduated tax brackets (16,750) (16,750)
Benefit of utilization of net
operating loss carryover (4,626) (4,626)
State tax net of federal
benefit 4,584 4,194
Other, net (1,588) 562
------- -------
$ 40,250 $ 37,016
======= =======
The tax effects of temporary differences that give rise to
the deferred tax liability at June 30, 1999 follow:
Installment sale reporting $ 29,699
less current portion (2,104)
--------
$ 27,595
========
The change in the deferred tax liability during the year ended
June 30, 1999 was $8,311.
As of June 30, 1999 RMPC had $58,183 of deferred tax assets
related to net operating loss carryovers. RMPC had useable loss
carryovers of approximately $200,000 at the time of the business
combination, expiring in various years through the year 2017.
Due to a change in ownership of RMPC the net operating loss
carryover has been reduced from approximately $540,000 to
approximately $200,000, of which $24,750 has been utilized by
he Company since the change of ownership.
F-10
<PAGE>
ROCKY MOUNTAIN POWER CO.
AND CONSOLIDATED SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
June 30, 1999 and 1998
(6) Notes Payable, Bank
As of June 30, 1999, the Company had a line of credit from a bank
of $1,500,000.
The Company's President has personally guaranteed the total
$1,500,000 balance of the notes payable and has assigned to the
bank a life insurance policy with a $500,000 death benefit as
additional collateral.
The Company has agreed to provide annual audited financial
statements to the bank. The terms of the loan agreement require
that the Company maintain a debt to tangible net worth ratio not
to exceed one to one, a debt service coverage ratio of greater
than 1.25 to one and a current ratio of greater than one to one.
The line of credit is collateralized by certain real estate
mortgage notes receivable and certificates of purchase, and
bears interest at .5% over prime plus has an annual fee of .5%
of the total amount of the line. The line of credit is subject
to annual renewal and is due in December, 1999. At June 30,
1999, the Company had no outstanding borrowing on this line of
credit.
(7) Sale Proceeds Receivable
Effective June 30, 1999, the Company sold a real estate property
resulting in a receivable of $246,500. During July, 1999 the
Company received the $246,500 in cash.
(8) Year 2000 Compliance
The Company is aware of the issues associated with the programming code
in existing computer systems as the year 2000 approaches. The Company
has assessed these issues as they relate to the Company, and since the
Company currently has no operating business and does not use any computers,
and since it has no customers or supplier, it does not believe that there
are any material year 2000 issues to disclose in this Report.
F-11
<PAGE>
SIGNATURES
In accordance with Section 13 of 15(d) of the Securities Exchange
Act of 1934, the Company has duly caused this Report to be signed on
its behalf by the undersigned, thereunto duly authorized.
(Registrant) ROCKY MOUNTAIN POWER CO.
(Date) September 22, 1999
By:(Signature) /s/ Michael L. Schumacher
(Name and Title) Michael L. Schumacher
President, Chief Executive Officer and
Chief Financial Officer
Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on
behalf of the Company and in the capacities and on the dates indicated:
Signature Capacity Date
/s/ Michael L. Schumacher President, Chief Executive Officer 9/22/99
Michael L. Schumacher and Chief Financial Officer
/s/ George A. Powell Vice President and Director
George A. Powell
/s/James Phelps Secretary and Director
James Phelps
/s/ Robert S. Benham Director
Robert S. Benham
/s/ Peter Porath Director
Peter Porath
/s/ Robert F. Moreland Director
Robert F. Moreland
/s/ Norman L. Horsfield Director
Norman L. Horsfield
<PAGE>
INDEX TO FINANCIAL STATEMENTS
MPEG SUPER SITE, INC.
Part I. Financial Information
Item I. Financial Statements
Balance Sheets as of June 30, 1999
and December 31, 1998 2
Statement of Operations, Three Months
Ended June 30, 1999 3
Statement of Operations, Six Months
Ended June 30, 1999 4
Statement of Cash Flows, Six Months
Ended June 30, 1999 4
Notes to Financial Statements 5
Item 2. Management's Discussion and Analysis of
Financial Conditions and Results of
Operations 6
Part II. Other Information 7
1
<PAGE>
MPEG SUPER SITE, INC.
BALANCE SHEETS
(Unaudited)
ASSETS
June 30 December 31
1999 1998
------------ -----------
Current Assets
Cash $ 642 $ 2,227
----------- ----------
Total Current Assets 642 2,227
Organization costs,
net of amortization 5,635 6,440
----------- ----------
Total Assets $ 6,277 $ 8,667
=========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable 250 -
----------- ----------
Total Current Liabilities 250 -
----------- ----------
Stockholders' Equity:
Preferred Stock, no par value,
5,000,000 shares authorized
none issued and outstanding - -
Common Stock, no par value,
100,000,000 shares authorized
2,000,000 shares issued and
outstanding 12,050 12,050
Additional paid-in capital 5,400 3,600
Accumulated deficit (11,423) (6,983)
----------- ----------
Total Stockholders' Equity 6,027 8,667
----------- --
- --------
Total Liabilities and Stockholders' Equity $ 6,277 $
8,667
===========
==========
The accompanying notes are an integral part of the financial
statements.
2
<PAGE>
MPEG SUPER SITE, INC.
STATEMENT OF OPERATIONS
(Unaudited)
Three Months Ended June 30, 1999
Revenues $ -
-----------
Operating Expenses:
Amortization 402
Professional fees 632
Rent 300
Other 20
-----------
Total Operating Expenses 1,354
-----------
Net Loss $ (1,354)
-----------
Per Share $ nil
===========
Weighted Average Number of Shares Outstanding 2,000,000
===========
The accompanying notes are an integral part of the financial statements.
3
<PAGE>
MPEG SUPER SITE, INC.
STATEMENT OF OPERATIONS
(Unaudited)
Six Months Ended June 30, 1999
Revenues $ -
-----------
Operating Expenses:
Amortization 805
Professional fees 2,545
Rent 600
Advertising 457
Other 33
-----------
Total Operating Expenses 4,440
-----------
Net Loss $ (4,440)
-----------
Per Share $ nil
===========
Weighted Average Number of Shares Outstanding 2,000,000
===========
The accompanying notes are an integral part of the financial statements.
4
<PAGE>
MPEG SUPER SITE, INC.
STATEMENT OF CASH FLOWS
(Unaudited)
Six Months Ended June 30, 1999
Cash Flows from Operating Activities:
Net (loss) $ (4,440)
Amortization 805
Increase in accounts payable 250
----------
Net Cash (Used in) Operating Activities (3,385)
----------
Cash Flows from Investing Activities -
----------
Cash Flows from Financing Activities:
Increase in additional paid-in capital 1,800
----------
Net Cash Provided by Financing Activities 1,800
----------
(Decrease) in Cash (1,585)
Cash, Beginning of Period 2,227
----------
Cash, End of Period $ 642
==========
Interest Paid $ -
==========
Income Taxes Paid $ -
==========
The accompanying notes are an integral part of the financial statements.
5
<PAGE>
MPEG SUPER SITE, INC.
NOTES TO FINANCIAL STATEMENTS
June 30, 1999 (Unaudited)
(1) Condensed Financial Statements
The financial statements included herein have been prepared by MPEG Super
Site, Inc. without audit, pursuant to the rules and regulations of the
Securities and Exchange Commission. Certain information and footnote
disclosures normally included in the financial statements prepared in
accordance with generally accepted accounting principles have been condensed
or omitted as allowed by such rules and regulations, and MPEG Super Site, Inc.
believes that the disclosures are adequate to make the information presented
not misleading. It is suggested that these financial statements be read in
conjunction with the December 31, 1998 audited financial statements and the
accompanying notes thereto. While management believes the procedures followed
in preparing these financial statements are reasonable, the accuracy of the
amounts are in some respect's dependent upon the facts that will exist, and
procedures that will be accomplished by MPEG Super Site, Inc. later in the
year.
The management of MPEG Super Site, Inc. believes that the accompanying
unaudited condensed financial statements contain all adjustments (including
normal recurring adjustments) necessary to present fairly the operations and
cash flows for the periods presented.
6
<PAGE>
ITEM 2
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
MPEG Super Site, Inc. (the "Company") was organized as a Colorado
corporation under the name of Copper Capital, Inc. on December 5, 1996, in
order to evaluate, structure and complete a merger with, or acquisition
of, prospects consisting of private companies, partnerships or sole
proprietorships.
On July 14, 1999, the Company completed the acquisition of 100% of the
outstanding common stock of MPEG Super Site, Inc., a Nevada corporation
("MPEG"), in exchange for 7,000,000 shares of the Company's common stock
(approximately 58.3% of the shares now outstanding).
At June 30, 1999, the Company had no material commitments for capital
expenditures.
7
<PAGE>
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
None.
Item 2. Changes in Securities
None.
Item 3. Defaults upon Senior Securities
None.
Item 4. Submission of Matters to a Vote of Security Holders
None.
Item 5. Other Information
None.
Item 6. Exhibits and Reports on Form 8-K
None.
8
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
MPEG SUPER SITE, INC.
Date: September 30, 1999 By:/s/ Bruce M. Tomiyami
Bruce M. Tomiyami,
Chief Financial Officer,
Treasurer, Secretary and
Director
SHARE EXCHANGE AGREEMENT
THIS SHARE EXCHANGE AGREEMENT is made this 24th day of
September, 1999, by and between Rocky Mountain Power Company, a
Colorado corporation (hereinafter referred to as "Rocky"), MPEG
Super Site, Inc., a Colorado corporation (hereinafter referred to
as "MPEG").
WHEREAS, Rocky desires to acquire all of the issued and
outstanding shares of common stock of MPEG in exchange for an
aggregate of 13,390,000 authorized but un-issued restricted
shares of the common stock, no par value, of Rocky (the "Common
Stock") (the "Exchange Offer"); and
WHEREAS, MPEG desires to assist Rocky in a business
combination which will result in the shareholders of MPEG owning
approximately 92% of the then issued and outstanding shares of
Rocky's Common Stock, and Rocky holding 100% of the issued and
outstanding shares of MPEG's common stock; and
WHEREAS, the share exchange contemplated hereby will result
in the MPEG shareholders tendering all of the outstanding common
stock of MPEG to Rocky in exchange solely for the Common Stock
and no other consideration, which the parties hereto intend to
treat as a reorganization under I.R.C. Section 368(a)(1)(B).
NOW, THEREFORE, in consideration of the mutual promises,
covenants, and representations contained herein,
THE PARTIES HERETO AGREE AS FOLLOWS:
ARTICLE 1
EXCHANGE OF SECURITIES
1.1 Issuance of Shares. Subject to all of the terms and
conditions of this Agreement, Rocky agrees to offer one share of
Common Stock for each share of MPEG common stock issued and
outstanding, or a total of 13,390,000 shares of Rocky's Common
Stock. The Common Stock will be issued directly to the
shareholders of MPEG on the Closing, in the amounts set forth on
the attached Shareholder list, which is attached hereto and
incorporated herein by reference.
1.2 Exemption from Registration. The parties hereto intend
that the Common Stock to be issued by Rocky to MPEG shareholders
shall be exempt from the registration requirements of the
Securities Act of 1933, as amended (the "Act"), pursuant to
Section 4(2) of the Act and the rules and regulations promulgated
thereunder.
ARTICLE 2
REPRESENTATIONS AND WARRANTIES OF MPEG
Except as disclosed in Schedule 2 which is attached hereto
and incorporated herein by reference, MPEG hereby represents and
warrants to Rocky that:
2.1 Organization. MPEG is a corporation duly organized,
validly existing, and in good standing under the laws of
Colorado, has all necessary corporate powers to own its
properties and to carry on its business as now owned and operated
by it, and is duly qualified to do business and is in good
standing in each of the jurisdictions where its business requires
qualification.
2.2 Capital. The authorized capital stock of MPEG consists
of 50,000,000 shares of Common Stock, of which 13,390,000 are
currently issued and outstanding. All of the issued and
outstanding shares of MPEG are duly authorized, validly issued,
fully paid, and non-assessable. There are no outstanding
subscriptions, options, rights, warrants, debentures,
instruments, convertible securities, or other agreements or
commitments obligating MPEG to issue or to transfer from treasury
any additional shares of its capital stock of any class.
2.3 Subsidiaries. MPEG does not have any subsidiaries or
own any interest in any other enterprise (whether or not such
enterprise is a corporation) except for the Nevada subsidiary
named MPEG Super Site, Inc..
2.4 Directors and Officers. Schedule 2 contains the names
and titles of all directors and officers of MPEG as of the date
of this Agreement.
2.5 Financial Statements. MPEG has delivered to Rocky the
audited balance sheet its wholly owned subsidiary as of June 30,
1999, and operating statement covering the period from inception
through June 30, 1999 (the "Financial Statements"). The
Financial Statements are complete and correct in all material
respects and have been prepared in accordance with generally
accepted accounting principles applied on a consistent basis
throughout the periods indicated. The Financial Statements
accurately set out and describe the financial condition of MPEG's
subsidiary as of June 30, 1999.
2.6 Absence of Changes. Since June 30, 1999, except for
changes in the ordinary course of business which have not in the
aggregate been materially adverse, to the best of MPEG's
knowledge, MPEG has conducted its business only in the ordinary
course and has not experienced or suffered any material adverse
change in the condition (financial or otherwise), results of
operations, properties, business or prospects of MPEG or waived
or surrendered any claim or right of material value.
2.7 Absence of Undisclosed Liabilities. Neither MPEG nor
any of its properties or assets are subject to any material
liabilities or obligations of any nature, whether absolute,
accrued, contingent or otherwise and whether due or to become
due, that are not reflected in the financial statements presented
to Rocky or have otherwise been disclosed to Rocky.
2.8 Tax Returns. Within the times and in the manner
prescribed by law, MPEG has filed all federal, state and local
tax returns required by law, or has filed extensions which have
not yet expired, and has paid all taxes, assessments and
penalties due and payable.
2.9 Investigation of Financial Condition. Without in any
manner reducing or otherwise mitigating the representations
contained herein, Rocky and/or its attorneys shall have the
opportunity to meet with accountants and attorneys to discuss the
financial condition of MPEG. MPEG shall make available to Rocky
and/or its attorneys all books and records of MPEG.
2.10 Trade Names and Rights. MPEG does not use any
trademark, service mark, trade name, or copyright in its
business, or own any trademarks, trademark registrations or
applications, trade names, service marks, copyrights, copyright
registrations or applications.
2.11 Compliance with Laws. MPEG has complied with, and is
not in violation of, applicable federal, state or local statutes,
laws and regulations (including, without limitation, any
applicable building, zoning or other law, ordinance or
regulation) affecting its properties or the operation of its
business, except for matters which would not have a material
affect on MPEG or its properties.
2.12 Litigation. MPEG is not a party to any suit, action,
arbitration or legal, administrative or other proceeding, or
governmental investigation pending or, to the best knowledge of
MPEG, threatened against or affecting MPEG or its business,
assets or financial condition, except for matters which would not
have a material affect on MPEG or its properties. MPEG is not in
default with respect to any order, writ, injunction or decree of
any federal, state, local or foreign court, department, agency or
instrumentality applicable to it. MPEG is not engaged in any
lawsuit to recover any material amount of monies due to it.
2.13 Authority. MPEG has full corporate power and authority
to enter into this Agreement. The board of directors of MPEG has
taken all action required to authorize the execution and delivery
of this Agreement by or on behalf of MPEG and the performance of
the obligations of MPEG under this Agreement. No other corporate
proceedings on the part of MPEG are necessary to authorize the
execution and delivery of this Agreement by MPEG in the
performance of its obligations under this Agreement. This
Agreement is, when executed and delivered by MPEG, and will be a
valid and binding agreement of MPEG, enforceable against MPEG in
accordance with its terms, except as such enforceability may be
limited by general principles of equity, bankruptcy, insolvency,
moratorium and similar laws relating to creditors' rights
generally.
2.14 Ability to Carry Out Obligations. Neither the
execution and delivery of this Agreement, the performance by MPEG
of its obligations under this Agreement, nor the consummation of
the transactions contemplated under this Agreement will to the
best of MPEG's knowledge: (a) materially violate any provision
of MPEG's articles of incorporation or bylaws; (b) with or
without the giving of notice or the passage of time, or both,
violate, or be in conflict with, or constitute a material default
under, or cause or permit the termination or the acceleration of
the maturity of, any debt, contract, agreement or obligation of
MPEG, or require the payment of any prepayment or other
penalties; (c) require notice to, or the consent of, any party to
any agreement or commitment, lease or license, to which MPEG is
bound; (d) result in the creation or imposition of any security
interest, lien, or other encumbrance upon any material property
or assets of MPEG; or (e) violate any statute or law or any
judgment, decree, order, regulation or rule of any court or
governmental authority to which MPEG is bound or subject.
2.15 Full Disclosure. None of the representations and
warranties made by MPEG herein, or in any schedule, exhibit or
certificate furnished or to be furnished in connection with this
Agreement by MPEG, or on its behalf, contains or will contain any
untrue statement of material fact.
2.16 Assets. MPEG has good and marketable title to all of
its tangible properties and such tangible properties are not
subject to any material liens or encumbrances.
2.17 Material Contracts and Obligations. Attached hereto on
Schedule 2 is a list of all agreements, contracts, indebtedness,
liabilities and other obligations to which MPEG is a party or by
which it is bound that are material to the conduct and operations
of its business and properties, which provide for payments to or
by the Company in excess of $10,000; or which involve
transactions or proposed transactions between the Company and its
officers and directors. Copies of such agreements and contracts
and documentation evidencing such liabilities and other
obligations have been made available for inspection by Rocky and
its counsel. All of such agreements and contracts are valid,
binding and in full force and effect in all material respects,
assuming due execution by the other parties to such agreements
and contracts.
2.18 Consents and Approvals. No consent, approval or
authorization of, or declaration, filing or registration with,
any governmental or regulatory authority is required to be made
or obtained by MPEG in connection with: (a) the execution and
delivery by MPEG of this Agreement; (b) the performance by MPEG
of its obligations under this Agreement; or (c) the consummation
by MPEG of the transactions contemplated under this Agreement.
ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF ROCKY
Except as disclosed in Schedule 3 which is attached hereto
and incorporated herein by reference, Rocky represents and
warrants to MPEG that:
3.1 Organization. Rocky is a corporation duly organized,
valid existing, and in good standing under the laws of Colorado,
has all necessary corporate powers to own properties and to carry
on business, and it is not now conducting any business, except to
the extent to which the effecting of the transaction contemplated
by this Agreement constitutes doing business.
3.2 Capitalization. The authorized capital stock of Rocky
consists of 100,000,000 shares of no par value Common Stock of
which 611,270 shares of Common Stock are currently issued and
outstanding. All of the issued and outstanding shares of Common
Stock are duly authorized, validly issued, fully paid and non-
assessable. There are no outstanding subscriptions, options,
rights, warrants, convertible securities, or other agreements or
commitments obligating Rocky to issue or to transfer from
treasury any additional shares of its capital stock of any class.
Prior to the Closing, the board of directors of Rocky will
approve a 2.0 for 1 forward split which will increase the number
of shares issued and outstanding to 1,222,540.
3.3 Subsidiaries. Rocky does not presently have any
subsidiaries or own any interest in any other enterprise (whether
or not such enterprise is a corporation) except for Prime Rate
Income & Dividend Enterprises, Inc. ("Pride").
3.4 Directors and Officers. Schedule 3 contains the names
and titles of all directors and officers of Rock as of the date
of this Agreement.
3.5 Financial Statements. Rocky has delivered to MPEG its
audited balance sheet and statements of operations and cash flows
as of and for the period ended June 30, 1998, and its unaudited
balance sheet and statements of operations for the nine months
ended March 31, 1999 (the "Financial Statements"). The
Financial Statements are complete and correct in all material
respects and have been prepared in accordance with generally
accepted accounting principles applied on a consistent basis
throughout the periods indicated. The Financial Statements
accurately set out and describe the financial condition and
operating results of the Company as of the dates, and for the
periods, indicated therein. The current liabilities of Rocky are
set forth on Schedule 2. As of the Closing, the total
liabilities of Rocky shall be zero
3.6 Absence of Changes. Since March 31, 1999, except for
changes in the ordinary course of business which have not in the
aggregate been materially adverse, to the best of Rocky's
knowledge, Rocky has not experienced or suffered any material
adverse change in its condition (financial or otherwise), results
of operations, properties, business or prospects or waived or
surrendered any claim or right of material value.
3.7 Absence of Undisclosed Liabilities. To the best of
Rocky's knowledge, neither Rocky nor any of its properties or
assets are subject to any liabilities or obligations of any
nature, whether absolute, accrued, contingent or otherwise and
whether due or to become due, that are not reflected in the
financial statements presented to MPEG.
3.8 Tax Returns. Within the times and in the manner
prescribed by law, Rocky has filed all federal, state and local
tax returns required by law and has paid all taxes, assessments
and penalties due and payable.
3.9 Investigation of Financial Condition. Without in any
manner reducing or otherwise mitigating the representations
contained herein, MPEG shall have the opportunity to meet with
Rocky's accountants and attorneys to discuss the financial
condition of Rocky. Rocky shall make available to MPEG all books
and records of Rocky.
3.10 Trade Names and Rights. Rocky does not use any
trademark, service mark, trade name, or copyright in its
business, or own any trademarks, trademark registrations or
applications, trade names, service marks, copyrights, copyright
registrations or applications.
3.11 Compliance with Laws. To the best of Rocky's
knowledge, Rocky has complied with, and is not in violation of,
applicable federal, state or local statutes, laws and regulations
(including, without limitation, any applicable building, zoning,
or other law, ordinance, or regulation) affecting its properties
or the operation of its business.
3.12 Litigation. Rocky is not a party to any suit, action,
arbitration, or legal, administrative, or other proceeding, or
governmental investigation pending or, to the best knowledge of
Rocky, threatened against or affecting Rocky or its business,
assets, or financial condition. Rocky is not in default with
respect to any order, writ, injunction, or decree of any federal,
state, local, or foreign court, department agency, or
instrumentality. Rocky is not engaged in any legal action to
recover moneys due to it.
3.13 No Prior or Pending Investigation. Rocky is not aware
of any prior or pending investigations or legal proceedings by
the SEC, any state securities regulatory agency, or any other
governmental agency regarding Rocky.
3.14 Authority. Rocky has full corporate power and
authority to enter into this Agreement and to consummate the
transactions contemplated by this Agreement. The Board of
Directors of Rocky has taken all action required to authorize the
execution and delivery of this Agreement by or on behalf of
Rocky, the performance of the obligations of Rocky under this
Agreement and the consummation by Rocky of the transactions
contemplated under this Agreement. No other corporate
proceedings on the part of Rocky Are necessary to authorize the
execution and delivery of this Agreement by Rocky in the
performance of its obligations under this Agreement. This
Agreement is, and when executed and delivered by Rocky, will be a
valid and binding agreement of Rocky, enforceable against Rocky
in accordance with its terms, except as such enforceability may
be limited by general principles of equity, bankruptcy,
insolvency, moratorium and similar laws relating to creditors
rights generally.
3.15 Ability to Carry Out Obligations. Neither the
execution and delivery of this Agreement, the performance by
Rocky of its obligations under this Agreement, nor the
consummation of the transactions contemplated under this
Agreement will, to the best of Rocky's knowledge: (a) violate
any provision of Rocky's articles of incorporation or bylaws; (b)
with or without the giving of notice or the passage of time, or
both, violate, or be in conflict with, or constitute a default
under, or cause or permit the termination or the acceleration of
the maturity of, any debt, contract, agreement or obligation of
Rocky, or require the payment of any prepayment or other
penalties; (c) require notice to, or the consent of, any party to
any agreement or commitment, lease or license, to which Rocky is
bound; (d) result in the creation or imposition of any security
interest, lien or other encumbrance upon any property or assets
of Rocky; or (e) violate any statute or law or any judgment,
decree, order, regulation or rule of any court or governmental
authority to which Rocky is bound or subject.
3.16 Validity of Rocky Shares. The shares of Rocky Common
Stock to be delivered pursuant to this Agreement, when issued in
accordance with the provisions of this Agreement, will be duly
authorized, validly issued, fully paid and non-assessable.
3.17 Full Disclosure. None of the representations and
warranties made by Rocky herein, or in any exhibit, certificate
or memorandum furnished or to be furnished by Rocky, or on its
behalf, contains or will contain any untrue statement of material
fact, or omit any material fact the omission of which would be
misleading.
3.18 Assets. Rocky will not have any assets at the time of
closing except for assets in PRIDE which are being spun off.
3.19 Material Contracts and Obligations. Rocky has no
material contracts to which it is a party or by which it is
bound.
3.20 Consents and Approvals. No consent, approval or
authorization of, or declaration, filing or registration with,
any governmental or regulatory authority is required to be made
or obtained by Rocky in connection with: (a) the execution and
delivery by Rocky of its obligations under this Agreement; (b)
the performance by Rocky of its obligations under this Agreement;
or (c) the consummation by Rocky of the transactions contemplated
by this Agreement.
3.21 Real Property. Rocky does not own, use or claim any
interest in any real property, including without limitation any
license, leasehold or any similar interest in real property or
will mot at the time of closing except as set forth in Rocky's
SEC filings.
ARTICLE 4
COVENANTS
4.1 Investigative Rights. From the date of this Agreement
until the Closing Date, each party shall provide to the other
party, and such other party's counsels, accountants, auditors,
and other authorized representatives, full access during normal
business hours and upon reasonable advance written notice to all
of each party's properties, books, contracts, commitments, and
records for the purpose of examining the same. Each party shall
furnish the other party with all information concerning each
party's affairs as the other party may reasonably request. If
the transaction contemplated hereby is not completed, all
documents received by each party and/or its attorneys and
accountants, auditors or other authorized representatives shall
be returned to the other party who provided same upon request.
The parties hereto, their directors, employees, agents and
representatives shall not disclose any of the information
described above unless such information is already disclosed to
the public, without the prior written consent of the party to
which the confidential information pertains. Each party shall
take such steps as are necessary to prevent disclosure of such
information to unauthorized third parties.
4.2 Conduct of Business. Prior to the Closing, Rocky and
MPEG shall each conduct its business in the normal course, and
shall not sell, pledge, or assign any assets, without the prior
written approval of the other party, except in the regular course
of business except for transactions by PRIDE. Neither Rocky nor
MPEG shall amend its Articles of Incorporation or Bylaws, declare
dividends, redeem or sell stock or other securities, incur
additional or newly-funded liabilities, acquire or dispose of
fixed assets, change employment terms, enter into any material or
long-term contract, guarantee obligations of any third party,
settle or discharge any balance sheet receivable for less than
its stated amount, pay more on any liability than its stated
amount, or enter into any other transaction other than in the
regular course of business except as otherwise contemplated
herein.
ARTICLE 5
CONDITIONS PRECEDENT TO ROCKY'S PERFORMANCE
5.1 Conditions. The obligations of Rocky hereunder shall
be subject to the satisfaction, at or before the Closing, of all
the conditions set forth in this Article 6. Rocky may waive any
or all of these conditions in whole or in part without prior
notice; provided, however, that no such waiver of a condition
shall constitute a waiver by Rocky of any other condition of or
any of Rocky's other rights or remedies, at law or in equity, if
MPEG shall be in default of any of their representations,
warranties, or covenants under this Agreement.
5.2 Accuracy of Representations. Except as otherwise
permitted by this Agreement, all representations and warranties
by MPEG in this Agreement or in any written statement that shall
be delivered to Rocky by MPEG under this Agreement shall be true
and accurate on and as of the Closing Date as though made at that
time.
5.3 Performance. MPEG shall have performed, satisfied, and
complied with all covenants, agreements, and conditions required
by this Agreement to be performed or complied with by it, on or
before the Closing Date.
5.4 Absence of Litigation. No action, suit, or proceeding
before any court or any governmental body or authority,
pertaining to the transaction contemplated by this Agreement or
to its consummation, shall have been instituted or threatened
against MPEG on or before the Closing Date.
ARTICLE 6
CONDITIONS PRECEDENT TO MPEG'S PERFORMANCE
6.1 Conditions. MPEG's obligations hereunder shall be
subject to the satisfaction, at or before the Closing, of all the
conditions set forth in this Article 7. MPEG may waive any or
all of these conditions in whole or in part without prior notice;
provided, however, that no such waiver of a condition shall
constitute a waiver by MPEG of any other condition of or any of
MPEG's rights or remedies, at law or in equity, if Rocky shall be
in default of any of its representations, warranties, or
covenants under this Agreement.
6.2 Accuracy of Representations. Except as otherwise
permitted by this Agreement, all representations and warranties
by Rocky in this Agreement or in any written statement that shall
be delivered to MPEG by Rocky under this Agreement shall be true
and accurate on and as of the Closing Date as though made at that
time.
6.3 Performance. Rocky shall have performed, satisfied,
and complied with all covenants, agreements, and conditions
required by this Agreement to be performed or complied with by
them, on or before the Closing Date.
6.4 Absence of Litigation. No action, suit or proceeding
before any court or any governmental body or authority,
pertaining to the transaction contemplated by this Agreement or
to its consummation, shall have been instituted or threatened
against Rocky on or before the Closing Date.
6.5 Directors of Rocky. Effective on the Closing, Rocky
shall have fixed the size of its Board of Directors at three (3)
persons, and such Board of Directors shall include Kanematsu
Misawa, Joseph S. Muto, and Randall J. Lanham.
6.6 Officers of Rocky. Effective on the Closing, Rocky
shall have elected the following new Officers of Rocky:
Kunimitsu Misawa: Chairman
Bruce M. Tomiyama: CFO, Treasurer and Secretary
6.7 Forward Split. Just prior to Closing, Rocky shall
complete a 2.0 for 1 forward stock split.
ARTICLE 7
CLOSING
7.1 Closing. The Closing of this transaction shall be held
at the offices of Krys Boyle Freedman & Sawyer, P.C., 600
Seventeenth Street, Suite 2700 South Tower, Denver, Colorado
80202, or such other place as shall be mutually agreed upon, on
such date as shall be mutually agreed upon by the parties. At the
Closing:
(a) Shareholders shall deliver letters of acceptance and
duly endorsed certificates representing their shares of MPEG
being exchanged for shares of Rocky.
(b) Shareholders shall receive a certificate or
certificates representing the number of shares of Rocky Common
Stock for which the shares of MPEG common stock shall have been
exchanged.
(c) Rocky shall deliver a signed Consent and/or Minutes of
the Directors of Rocky approving this Agreement and each matter
to be approved by the Directors of Rocky under this Agreement.
(d) MPEG shall deliver a signed Consent or Minutes of the
Directors of MPEG approving this Agreement and each matter to be
approved by the Directors of MPEG under this Agreement.
ARTICLE 8
SPIN OFF OF PRIDE
8.1 The parties agreed that prior to the Closing, Rocky
shall spin off all of the issued and outstanding shares of
Rocky's wholly-owned subsidiary named Prime Rate Income &
Dividend Enterprises, Inc. ("PRIDE") to its shareholders based on
a shareholder list prepared one (1) day prior to Closing.
Certificates representing the shares to be spun off will be
placed with an escrow agent mutually acceptable to Rocky and MPEG
with instructions to distribute the shares once PRIDE has a Form
10-SB which is effective with the Securities and Exchange
Commission.
8.2 In the event that a Form 10-SB has not become effective
with the Securities and Exchange Commission within twelve (12)
months after the Closing, PRIDE will use its best effects to
liquidate all of its assets and liabilities and then distribute
all proceeds pro rata to the shareholders on the shareholder list
being held in escrow.
8.3 The current directors of PRIDE will remain as the
directors of PRIDE until the spin off of either the PRIDE stock
or the proceeds of liquidation is completed.
8.4 PRIDE will be responsible for all of its expenses of
operation including the costs of the Form 10-SB until the spin
off is complete.
ARTICLE 9
MISCELLANEOUS
9.1 Captions and Headings. The Article and paragraph
headings throughout this Agreement are for convenience and
reference only, and shall in no way be deemed to define, limit,
or add to the meaning of any provision of this Agreement.
9.2 No Oral Change. This Agreement and any provision
hereof, may not be waived, changed, modified, or discharged
orally, but it can be changed by an agreement in writing signed
by the party against whom enforcement of any waiver, change,
modification, or discharge is sought.
9.3 Non-Waiver. Except as otherwise expressly provided
herein, no waiver of any covenant, condition, or provision of
this Agreement shall be deemed to have been made unless expressly
in writing and signed by the party against whom such waiver is
charged; and (i) the failure of any party to insist in any one or
more cases upon the performance of any of the provisions,
covenants, or conditions of this Agreement or to exercise any
option herein contained shall not be construed as a waiver or
relinquishment for the future of any such provisions, covenants,
or conditions, (ii) the acceptance of performance of anything
required by this Agreement to be performed with knowledge of the
breach or failure of a covenant, condition, or provision hereof
shall not be deemed a waiver of such breach or failure, and (iii)
no waiver by any party of one breach by another party shall be
construed as a waiver with respect to any other or subsequent
breach.
9.4 Time of Essence. Time is of the essence of this
Agreement and of each and every provision hereof.
9.5 Entire Agreement. This Agreement contains the entire
Agreement and understanding between the parties hereto, and
supersedes all prior agreements and understandings.
9.6 Choice of Law. This Agreement and its application
shall be governed by the laws of the State of Colorado, except to
the extent its conflict of laws provisions would apply the laws
of another jurisdiction.
9.7 Notices. All notices, requests, demands, and other
communications under this Agreement shall be in writing and shall
be deemed to have been duly given on the date of service if
served personally on the party to whom notice is to be given, or
on the third day after mailing if mailed to the party to whom
notice is to be given, by first class mail, registered or
certified,
postage prepaid, and properly addressed as follows:
Rocky:
Rocky Mountain Power Company
____________________________
____________________________
with a copy to:
Tom Boyle, Esq.
Krys Boyle Freedman & Sawyer, P.C.
600 Seventeenth Street, Suite 2700 South Tower
Denver, Colorado 80202
MPEG:
MPEG Super Site, Inc.
1358 5th Street
Santa Monica, California 90401
with a copy to:
Randall J. Lanham, Esq.
Lanham & Associates
45 Glen Echo
Dove Canyon, California 92679
9.8 Binding Effect. This Agreement shall inure to and be
binding upon the heirs, executors, personal representatives,
successors and assigns of each of the parties to this Agreement.
9.9 Mutual Cooperation. The parties hereto shall cooperate
with each other to achieve the purpose of this Agreement, and
shall execute such other and further documents and take such
other and further actions as may be necessary or convenient to
effect the transaction described herein.
9.10 Brokers. The parties hereto represent and agree that
no broker has brought about the aforementioned transaction and no
finder's fee has been paid or is payable by any party. Each of
the parties hereto shall indemnify and hold the other harmless
against any and all claims, losses, liabilities or expenses which
may be asserted against it as a result of its dealings,
arrangements or agreements with any broker or person, except as
described in this paragraph.
9.11 Announcements. Rocky and MPEG will consult and
cooperate with each other as to the timing and content of any
announcements of the transactions contemplated hereby to the
general public or to employees, customers or suppliers.
9.12 Expenses. Rocky and MPEG will pay their own legal,
accounting and any other out-of-pocket expenses reasonably
incurred in connection with this transaction, whether or not the
transaction contemplated hereby is consummated.
9.13 Exhibits. As of the execution hereof, the parties
hereto have provided each other with the Exhibits provided for
herein above, including any items referenced therein or required
to be attached thereto. Any material changes to the Exhibits
shall be immediately disclosed to the other party.
9.14 After the closing, Rocky's name will be changed and the
rights to the name "Rocky Mountain Power Co." will belong to
Rocky's management.
AGREED TO AND ACCEPTED as of the date first above written.
ROCKY MOUNTAIN POWER COMPANY MPEG SUPER SITE, INC.
By: /s/ Mick Schumacher By: /s/ Bruce M. Tomiyama
Mick Schumacher, President Bruce M. Tomiyama, CFO and
Secretary
SHAWN F. HACKMAN, ESQ.
SHAWN F. HACKMAN, a P.C.
3360 West Sahara Avenue, Suite 200
Las Vegas, Nevada 89102
(702) 732-2253
September 30, 1999
Securities and Exchange Commission
450 Fifth Street NW
Washington D.C. 20549
Board of Directors
MPEG Super Site, Inc. fka
Rocky Mountain Power Company
Corporate Stock Transfer Agency
Denver, Co
RE: MPEG Super Site Inc. fka
Rocky Mountain Power Company S-4 Share Registration
Ladies and Gentlemen:
We have acted as counsel to MPEG Super Site fka Rocky
Mountain Power Company, a Colorado Corporation (the"Company") in
connection with its Registration Statement on Form S-4 relating
to the registration of 13,390,000 shares of its common stock (the
"Shares"), $.001 par value per share. the shares are issuable in
relation to the acquisition of MPEG Super Site Inc. by Rocky
Mountain Power Company.
In our representation we have examined such documents,
corporate records, and other instruments as we have deemed
necessary or appropriate for purposes of this opinion, including,
but not limited to, the Articles of Incorporation, Bylaws of the
Company and Notice of filing effectiveness dated October 1, 1999.
Based upon the foregoing, it is our opinion that the Company is
duly organized and validly existing as a corporation under the
laws of the State of Colorado, that the S-4 was transmitted and
receipt of effective filing received on October 1, 1999 and that
the Shares, when issued and sold in accordance with the terms of
the Exchange, will be validly issued, fully paid, non-assessable
and may be issued without restrictive legend pursuant to the
registration.
Sincerely,
by: /s/ Shawn F. Hackman, Esq.
Shawn F. Hackman
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
Board of Directors
MPEG Super Site, Inc. fka
Rocky Mountain Power Company
Dear Ladies and Gentlemen:
As independent certified public accountants, we hereby
consent to the use of our report and to all references to our
Firm included in or made a part of this registration statement.
By:/s/ Kurt D. Saliger
Kurt D. Saliger, CPA
Las Vegas, Nevada 89102
September 29, 1999
[ARTICLE] 5
[LEGEND]
This schedule contains summary financial information extracted from the balance
sheet and statements of operations found on pages F-1 ex seq. of the Company's
Form 10-K for the fiscal year ended June 30, 1999, and is qualified in its
entirety by reference to such financial statements.
[/LEGEND]
<TABLE>
<S> <C>
[PERIOD-TYPE] 3-MOS
[FISCAL-YEAR-END] JUN-30-1999
[PERIOD-END] JUN-30-1999
[CASH] 2,227
[SECURITIES] 0
[RECEIVABLES] 0
[ALLOWANCES] 0
[INVENTORY] 0
[CURRENT-ASSETS] 2,227
[PP&E] 0
[DEPRECIATION] 0
[TOTAL-ASSETS] 6,227
[CURRENT-LIABILITIES] 250
[BONDS] 0
[PREFERRED-MANDATORY] 0
[PREFERRED] 0
[COMMON] 6,027
[OTHER-SE] 0
[TOTAL-LIABILITY-AND-EQUITY] 6,227
[SALES] 0
[TOTAL-REVENUES] 0
[CGS] 0
[TOTAL-COSTS] 0
[OTHER-EXPENSES] 0
[LOSS-PROVISION] 0
[INTEREST-EXPENSE] 0
[INCOME-PRETAX] 0
[INCOME-TAX] 0
[INCOME-CONTINUING] 0
[DISCONTINUED] 0
[EXTRAORDINARY] 0
[CHANGES] 0
[NET-INCOME] 0
[EPS-BASIC] 0
[EPS-DILUTED] 0
</TABLE>
