U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-SB
GENERAL FORM FOR REGISTRATION OF
SECURITIES OF SMALL BUSINESS ISSUERS
Under Section 12(b) Or 12(g) Of The Securities Act Of 1934
NuOasis Properties, Inc.
(Name of Small Business Issuer in Its Charter)
Nevada 88-0389258
(State or Other Jurisdictions (I.R.S. Employer Identification No.)
of Incorporation or Organization)
4695 MacArthur Court, #530, Newport Beach, California 92660
(Address of Principal Executive Offices) (Zip Code)
(949) 833-2094
(Issuer's Telephone Number, Including Area Code)
Securities to be registered under Section 12(b) of the Act: None
Securities to be registered under Section 12(g) of the Act:
Common Stock, par value $.001
(Title of Class)
[H:\NUOP\10SB\1999-8.wpd]
<PAGE>
INFORMATION STATEMENT
NUOASIS PROPERTIES, INC.
COMMON STOCK, PAR VALUE $.001
WE ARE NOT ASKING YOU FOR A PROXY
AND YOU ARE REQUESTED NOT TO SEND US A PROXY
THIS INFORMATION STATEMENT SHALL NOT CONSTITUTE AN OFFER TO SELL
OR THE SOLICITATION OF AN OFFER TO BUY ANY SECURITIES. ANY SUCH
OFFERING MAY ONLY BE MADE BY MEANS OF A SEPARATE PROSPECTUS
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT AND OTHERWISE
IN COMPLIANCE WITH APPLICABLE LAW.
The date of this Information Statement is March 6, 2000
[H:\NUOP\10SB\1999-8.wpd]
2
<PAGE>
PART I
ITEM 1. DESCRIPTION OF BUSINESS.
Business Development
NuOasis Properties Inc. ("NuOasis Properties") was incorporated in Colorado
in July 1993 under the name of Morelli Capital, Inc. ("MCI"). In January 1995,
NuOasis Properties amended its Articles of Incorporation to change its name to
NuOasis Properties, Inc. In April 1997, NuOasis Properties merged into NuOasis
Properties, Inc., a Nevada corporation, thus effecting a change in corporate
domicile. NuOasis Properties is a wholly owned subsidiary of NuOasis Resorts,
Inc. ("NuOasis"), a publicly held company. Since its incorporation, NuOasis
Properties has not conducted any significant operations.
Business of Issuer
NuOasis Properties' activities to date have focused primarily on
incorporation and the identification of potential operating opportunities or
acquisition targets. NuOasis Properties has not yet commenced principal
operations or earned significant revenues.
For future operations, NuOasis Properties will attempt to become active and
seek potential operating businesses and business opportunities with the intent
to acquire or merge with such businesses. NuOasis Properties is considered a
development stage company, and due to its status as a "shell" corporation, its
principal business purpose is to locate and consummate a merger or acquisition
with a private entity. No representation is made or intended that NuOasis
Properties will be able to carry out its activities profitably.
NuOasis Properties is voluntarily filing its registration statement on Form
10-SB to make information concerning itself more readily available to the
public. Management believes that being a reporting company under the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), could provide a
prospective merger or acquisition candidate with additional information
concerning NuOasis Properties. In addition, management believes that this may
make NuOasis Properties more attractive to an operating business opportunity as
a potential business combination candidate. As a result of filing its
registration statement, NuOasis Properties is obligated to file with the
Commission certain interim and periodic reports including an annual report
containing audited financial statements. NuOasis Properties intends to continue
to voluntarily file these periodic reports under the Exchange Act even if its
obligation to file such reports is suspended under applicable provisions of the
Exchange Act.
Any target acquisition or merger candidate of NuOasis Properties will
become subject to the same reporting requirements as NuOasis Properties upon
consummation of any such business combination. Thus, in the event that NuOasis
Properties successfully completes an acquisition or merger with another
operating business, the resulting combined business must provide audited
financial statements for at least the two most recent fiscal years, or in the
event that the combined operating business has been in business less than two
years, audited financial statements will be required from the period of
inception of the target acquisition or merger candidate.
[H:\NUOP\10SB\1999-8.wpd]
3
<PAGE>
Source of Business Opportunities
NuOasis Properties intends to use various sources in its search for
potential business opportunities including its officers and directors,
consultants, special advisors, securities broker-dealers, venture capitalists,
members of the financial community and others who may present management with
unsolicited proposals. NuOasis Properties may investigate and ultimately acquire
a venture that is in its preliminary or development stage, is already in
operation, or in various stages of its corporate existence or development.
Management cannot predict at this time the status or nature of any venture in
which NuOasis Properties may participate. The most likely scenario for a
possible business arrangement would involve the acquisition of or merger with an
operating business which does not need additional capital, but which merely
desires to establish a public trading market for its shares. Management believes
that NuOasis Properties could provide a potential public vehicle for a private
entity interested in becoming a publicly held corporation without the time and
expense typically associated with an initial public offering.
Evaluation Criteria
Once NuOasis Properties has identified a particular entity as a potential
acquisition or merger candidate, management will seek to determine whether
acquisition or merger is warranted or whether further investigation is
necessary. Such determination will generally be based on management's knowledge
and experience, or with the assistance of outside advisors and consultants
evaluating the preliminary information available to them. Management may elect
to engage outside independent consultants to perform preliminary analyses of
potential business opportunities. However, because of NuOasis Properties's lack
of capital it may not have the necessary funds for a complete and exhaustive
investigation of any particular opportunity. Further, no member of management is
a professional business analyst and management will rely on its own business
judgment in formulating the types of businesses that NuOasis Properties may
acquire. It is quite possible that management will not have any business
experience or expertise in the type of business engaged in by any potential
acquisition or merger candidate.
In evaluating such potential business opportunities, NuOasis Properties
will consider, to the extent relevant to the specific opportunity, several
factors including potential benefits to NuOasis Properties and its shareholders;
working capital, financial requirements and availability of additional
financing; history of operation, if any; nature of present and expected
competition; quality and experience of management; need for further research,
development or exploration; potential for growth and expansion; potential for
profits; and other factors deemed relevant to the specific opportunity. Because
NuOasis Properties has not located or identified any specific business
opportunity to date, there are certain unidentified risks that cannot be
adequately expressed prior to the identification of a specific business
opportunity. There can be no assurance following consummation of any acquisition
or merger that the business venture will develop into a going concern or, if the
business is already operating, that it will continue to operate successfully.
Many of the potential business opportunities available to NuOasis Properties may
involve new and untested products, processes or market strategies, which may not
ultimately prove successful.
Presently, NuOasis Properties cannot predict the manner in which it might
participate in a prospective business opportunity. Each separate potential
opportunity will be reviewed and, upon the basis of that review, a suitable
legal structure or method of participation will be chosen. The particular manner
in which NuOasis Properties participates in a specific business opportunity will
depend upon the nature of that opportunity, the respective needs and desires of
NuOasis Properties and management of the opportunity, and the relative
negotiating strength of the parties involved. Actual participation in a business
venture may take the form of an asset purchase, lease, joint venture, license,
partnership, stock purchase, reorganization, merger or consolidation.
[H:\NUOP\10SB\1999-8.wpd]
4
<PAGE>
NuOasis Properties may act directly or indirectly through an interest in a
partnership, corporation, or other form of organization, however, NuOasis
Properties does not intend to participate in opportunities through the purchase
of minority stock positions.
Because NuOasis Properties has not yet identified any potential acquisition
or merger candidates, it is unable to evaluate the type and extent of its likely
competition. NuOasis Properties is aware that there are several other public
companies with only nominal assets that are also searching for operating
businesses and other business opportunities as potential acquisition or merger
candidates. NuOasis Properties will be in direct competition with these other
public companies in its search for business opportunities and, due to NuOasis
Properties's lack of funds, it may be difficult to successfully compete with
these other companies.
As of this date, NuOasis Properties does not have any employees and has no
plans for retaining employees until such time as NuOasis Properties' business
warrants the expense, or until NuOasis Properties successfully acquires or
merges with an operating business.
NuOasis Properties's office is located at 4695 MacArthur Court, Suite 530,
Newport Beach, CA 92660.
NuOasis Properties will voluntarily send an annual report, including
audited financial statements, to its security holders.
NuOasis Properties will file annual, quarterly and special reports, proxy
statements and other information with the Securities and Exchange Commission
(SEC). The public may read and copy materials we file with the SEC at the SEC's
Public Reference room at 450 Fifth Street, N.W., Washington, D.C. 20549. The
public may obtain information on the operation of the Public Reference room by
calling the SEC at 1-800-SEC- 0330. The SEC maintains an Internet site that
contains reports, proxy and information statements, and other information
regarding issuers that file electronically with the SEC. The address of the
website is http://www.sec.gov.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.
Plan of Operation
During the next twelve months, NuOasis Properties will actively seek out
and investigate possible opportunities with the intent to acquire and merge with
one or more business ventures. In its search for business opportunities,
management will follow the procedures outlined in Item 1 above. Because NuOasis
Properties lacks funds, it may be necessary for the officers and directors to
either advance funds to NuOasis Properties or to accrue expenses until such time
as a successful business consolidation can be made. Management intends to hold
expenses to a minimum and to obtain services on a contingency basis when
possible.
Management's discretion is unrestricted, and NuOasis Properties may
participate in any business whatsoever that may in the opinion of management
meet the business objectives discussed herein. Indeed, NuOasis Properties may
effectuate a business combination with another business outside the United
States. NuOasis Properties has not limited the scope of its search to a
particular region. NuOasis Properties does not intend to utilize any notices or
advertisements in its search for business opportunities.
[H:\NUOP\10SB\1999-8.wpd]
5
<PAGE>
NuOasis Properties' officers and directors will be primarily responsible
for searching for an appropriate merger or acquisition candidate. However, to
the extent that the existing stockholders are aware of any potential business
acquisition candidates, they will also refer these to NuOasis Properties.
NuOasis Properties recognizes that as a result of its limited financial,
managerial or other resources, the number of suitable potential businesses that
may be available to it will be extremely limited. NuOasis Properties's principal
business objective will be to seek long-term growth potential in the business in
which it participates rather than immediate, short-term earnings. In seeking to
attain its business objectives NuOasis Properties will not restrict its search
to any particular industry. Rather, NuOasis Properties may investigate
businesses of essentially any kind or nature, including but not limited to
finance, high technology, manufacturing, service, research and development,
communications, insurance, brokerage, transportation and others. Management may
also seek to become involved with other development stage companies or companies
that could be categorized as "financially troubled." At the present time,
NuOasis Properties has not chosen the particular area of business in which it
proposes to engage and has not conducted any market studies with respect to
business property or industry.
As of the date hereof, NuOasis Properties has not made any arrangements or
definitive agreements to use outside advisors or consultants or to raise any
capital. In the event NuOasis Properties does need to raise capital most likely
the only method available to NuOasis Properties would be the private sale of its
securities. Because of the nature of NuOasis Properties as a development stage
company, it is unlikely it could make a public sale of securities or be able to
borrow any significant sum, from either a commercial or private lender. There
can be no assurance that NuOasis Properties will be able to obtain additional
funding when and if needed, or that such funding, if available, can be obtained
on terms acceptable to NuOasis Properties.
NuOasis Properties does not intend to use any employees, with the exception
of part-time clerical assistance on an as-needed basis. Outside advisors,
attorneys or consultants will only be used if they can be obtained for a minimal
cost or for a deferred payment basis. Management is confident that it will be
able to operate in this manner and to continue its search for business
opportunities during the next twelve months.
ITEM 3. DESCRIPTION OF PROPERTY.
Although NuOasis Properties does not own or control any material property,
NuOasis Properties will maintain its business address at 4695 MacArthur Ct.,
Ste. 530, Newport Beach, CA 92660. NuOasis Properties currently subleases these
offices from an affiliate, NuVen Advisors, LP ("NuVen"), as part of the Advisory
and Management Agreement with NuVen.
[H:\NUOP\10SB\1999-8.wpd]
6
<PAGE>
ITEM 4. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
<TABLE>
<CAPTION>
<S> <C> <C> <C>
(3) Amount and Nature
(2) Name and Address of Beneficial (4) Percent
(1) Title of Class of Beneficial Owner Ownership of Class
Common Stock NuOasis Resorts, Inc. 812,500 shares of 100%
4695 MacArthur Court $.001 par value
Suite 530
Newport Beach, CA 92660
Preferred Stock NuOasis Resorts, Inc. 300,000 shares of 100%
4695 MacArthur Court $.001 par value
Suite 530
Newport Beach, CA 92660
</TABLE>
ITEM 5. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS.
Identification of Directors and Executive Officers
NuOasis Properties, pursuant to its Bylaws is authorized to maintain a one
to nine (1-9) member Board of Directors, and executive officers as needed. The
directors and officers for fiscal 1999 were as follows:
Position
Name Held with NuOasis Properties Age Dates of Service
- ------------- ----------------------------- ------ -----------------------
Fred G. Luke Director, President 53 April 22, 1998 to present
Jon L. Lawver Director, Secretary 61 June 25, 1999 to present
All directors of NuOasis Properties hold office until the next annual
meeting of shareholders and until their successors have been elected and
qualified. Vacancies in the Board of Directors are filled by the remaining
members of the Board until the next annual meeting of shareholders. The officers
of NuOasis Properties are elected by the Board of Directors at its first meeting
after each annual meeting of NuOasis Properties' shareholders and serve at the
discretion of the Board of Directors or until their earlier resignation or
death.
Business Experience
The following is a brief account of the business experience during the past
five years of each director, director nominee and executive officer of NuOasis
Properties, including principal occupations and employment during that period
and the name and principal business of any corporation or other organization in
which such occupation and employment were carried on.
Fred G. Luke
Mr. Fred G. Luke has been a director and President of NuOasis Properties
since June 1993. Mr. Luke has more than twenty-nine years of experience in
domestic and international financing and management of private and publicly held
companies. Since 1982, Mr. Luke has provided consulting services and has served,
for brief periods lasting usually not more than six months, as Chief Executive
Officer and/or Chairman of the Board of various publicly held and privately held
companies in conjunction with financial and corporate restructuring services. In
addition to his position with NuOasis Properties, Mr. Luke currently serves as
Chairman and President of NuVen, an affiliate. Mr. Luke received a Bachelor of
Arts Degree in Mathematics from California State University, San Jose in 1969.
[H:\NUOP\10SB\1999-8.wpd]
7
<PAGE>
Jon L. Lawver
Mr. Lawver has served as Director and Secretary of NuOasis Properties since
June 1999. Mr. Lawver has been President and director of the Fantastic Foods
International, Inc., a wholly owned subsidiary of NuOasis Resorts, Inc., since
June 1993. Mr. Lawver has twenty-two (22) years of experience in the area of
bank financing where he has assisted companies in locating financing for small
to medium size companies primarily for expansion requirements. While assisting
companies with their financing requirements, Mr. Lawver has been under
consulting contracts through J. L. Lawver, Corp., a financial consulting firm,
which he formed in 1973, after an 11-year career with Bank of America, NT&SA
(the "Bank"). He began his employment with the Bank in l961 and ended his
employment in 1972 as Branch Manager of three of the Bank's offices. Since 1988,
Mr. Lawver has also served as president and director of Eurasia Finance &
Development Corp., a private finance and equipment leasing company and has
served as officer and director of Virtual Enterprises, Inc. (formerly The Toen
Group, Inc.), a transitional stage of the multimedia industry. Mr. Lawver has a
Bachelor of Science degree from the Widener University and has completed
graduate courses with the American Institute of Banking and University of
California at Los Angeles.
Involvement in Certain Legal Proceedings
During the past five years, no director or officer of NuOasis Properties has:
(1) Filed or has filed against him a petition under the federal bankruptcy laws
or any state insolvency law, nor has a receiver, fiscal agent or similar
officer been appointed by a court for the business or property of such
person, or any partnership in which he was a general partner, or any
corporation or business association of which he was an executive officer at
or within two years before such filings.
(2) Been convicted in a criminal proceeding;
(3) Been the subject of any order, judgment, or decree, not subsequently
reversed, suspended or vacated, of any court of competent jurisdiction,
permanently or temporarily enjoining such person from, or otherwise limiting
his involvement in any type of business, securities or banking activities;
(4) Been found by a court of compentent jurisdiction in a civil action, the SEC
or the Commodity Futures Trading Commission ("FTC") to have violated any
federal or state securities or commodities law, which judgment has not been
reversed, suspended, or vacated.
Compliance with Section 16(a) of the Exchange Act
Section 16(a) of the Securities Exchange Act of 1934 (the "Exchange Act")
requires NuOasis Properties's directors and officers and persons who own more
than 10 percent of NuOasis Properties's equity securities, to file reports of
ownership and changes in ownership with the SEC. Directors, officers and greater
than ten-percent shareholders are required by SEC regulation to furnish NuOasis
Properties with copies of all Section 16(a) reports filed.
Based solely on its review of the copies of the reports it received from
persons required to file, NuOasis Properties believes that during fiscal 1999,
all filing requirements applicable to its officers, directors and greater than
ten-percent shareholders were complied with.
[H:\NUOP\10SB\1999-8.wpd]
8
<PAGE>
Officers do not receive compensation for their service.
ITEM 7. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
In February 1994, and subsequently amended in January 1998, the Company entered
into an Advisory and Management Agreement (the "Agreement") with NuVen Advisors,
Inc., an entity owned by officers of the Company and officers of NuOasis.
Pursuant to the terms of the Agreement, the Company is required to pay $3,000
per month, plus expenses, in exchange for NuVen Advisors, Inc.'s assistance in
the formulation of possible acquisition strategies, and the management of
financial and general and administrative matters. In addition, the Company is
required to pay a fee equal to 5% of the value of each business opportunity (as
defined) introduced by NuVen Advisors, Inc. The Agreement has an initial term of
five years, but was canceled effective July 1, 1999 and was replaced with a
revised agreement described below. In connection with the Agreement, the
Company has recorded $36,000 of management and consulting fees in each of fiscal
1999 and 1998, and such amounts are included in the fiscal 1999 and 1998
statements of operations and comprehensive income (loss). The Agreement was
terminated by written mutual consent on or around June 30, 1999.
Effective July 1, 1999, NuOasis Properties entered into an Advisory and
Management Agreement (the "Agreement") with NuVen Advisors, LP, an entity owned
by Fred G. Luke and Jon L. Lawver, officers of NuOasis Properties and officers
of NuOasis. Pursuant to the terms of the Agreement, NuOasis Properties is
required to pay $3,500 per month, plus expenses, in exchange for NuVen Advisors,
LP's assistance in the formulation of possible acquisition strategies, and the
management of financial and general and administrative matters. In addition,
NuOasis Properties is required to pay a fee equal to 10% of the asset value or
investment made in NuOasis Properties resulting from NuVen Advisors, LP's
efforts, and a fee equal to 5% of the proceeds received by the Company in
connection with a sale of its assets. In addition, the Company granted a fully
vested option to NuVen Advisors, LP to purchase 500,000 shares of NuOasis
Properties' common stock at $0.50 per share. The Agreement has an initial term
of five years, but shall be automatically extended on an annual basis, unless
terminated by either party.
As of June 30, 1999, the Company had $5,100 due to NuOasis. The Company
also had $65,786 due to NuVen Advisors Inc., an entity that is owned by officers
of NuOasis and the Company. Such amounts do not bear interest, are
uncollateralized and have no stated repayment terms.
The Company also had $84,587 due from NuOasis.
ITEM 8. DESCRIPTION OF SECURITIES.
NuOasis Properties is authorized to issue, as of the date hereof, Seventy
Five Million (75,000,000) shares of $.001 par value common stock and Twenty Five
Million (25,000,000) shares of $.001 par value preferred stock, of which
approximately 812,500 shares of common stock are presently issued and
outstanding and 300,000 shares of preferred stock are presently issued and
outstanding, and owned beneficially and of record by NuOasis Resorts, Inc.
[H:\NUOP\10SB\1999-8.wpd]
9
<PAGE>
PART II
ITEM 1. MARKET PRICE OF AND DIVIDENDS ON THE REGISTRANT'S COMMON
EQUITY AND OTHER SHAREHOLDER MATTERS.
There is currently no public market for NuOasis Properties common stock.
ITEM 2. LEGAL PROCEEDINGS.
NuOasis is not and has not been a party to any legal proceedings, nor is
NuOasis Properties aware of any disputes that may result in legal proceedings.
NuOasis Properties has had no changes in and/or disagreements with its
accountants.
ITEM 4. RECENT SALES OF UNREGISTERED SECURITIES.
N/A
Under Nevada law, a corporation may indemnify its officers, directors,
employees and agents under certain circumstances, including indemnification of
such person against liability under the Securities Act of 1933. A true and
correct copy of Section 78.7502 of Nevada Revised Statutes that addresses
indemnification of officers, directors, employees and agents is attached hereto
as Exhibit 12.
In addition, Section 78.037 of the Nevada Revised Statutes and NuOasis
Properties' Articles of Incorporation and Bylaws provide that a director of this
corporation shall not be personally liable to the corporation or its
stockholders for monetary damages due to breach of fiduciary duty as a director
except for liability (a) for acts or omissions which involve intentional
misconduct, fraud or a knowing violation of law; or (b) for the payments of
distribution in violation of Nevada Revised Statute 78.300.
The effect of these provisions may be to eliminate the rights of NuOasis
Properties and its stockholders (through stockholders' derivative suit on behalf
of NuOasis Properties) to recover monetary damages against a director for breach
of fiduciary duty as a director (including breaches resulting from negligent or
grossly negligent behavior) except in the situations described in clauses (a) -
(b) of the preceding paragraph.
[H:\NUOP\10SB\1999-8.wpd]
10
<PAGE>
PART F/S
The following financial statements are attached to this report and filed as
a part thereof:
Index to Financial Statements.......................................F-1
Independent Auditors' Report........................................F-2
Balance Sheets......................................................F-3
Statements of Operations and Comprehensive Income (Loss)............F-4
Statements of Stockholder's Equity (Deficit)........................F-5
Statements of Cash Flow.............................................F-6
Notes to Financial Statements.......................................F-7
11
[H:\NUOP\10SB\1999-8.wpd]
<PAGE>
PART III
Item 1. Index To Exhibits.
3.1 Articles of Incorporation of NuOasis Properties, Inc.
3.2 By-laws of NuOasis Properties, Inc.
4.1 Form of Common Stock Certificate
10.1 Advisory Agreement with NuVen Advisors, LP
23.1 Consent of Independent Auditors
27 Financial Data Schedule
99.1 Additional Exhibits [Nevada Revised Statutes Section 78.7502]
[H:\NUOP\10SB\1999-8.wpd]
12
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 12 of the Securities Exchange Act
of 1934, CMA has duly caused this registration statement to be signed on its
behalf by the undersigned, thereunto duly authorized.
NUOASIS PROPERTIES, INC.
Date: March 6, 2000 By: /s/ Fred G. Luke
Name: Fred G. Luke
Title: President & Director
By: /s/ Jon Lawver
Name: Jon L. Lawver
Title: Secretary, Principal Accounting
Officer and Director
13
<PAGE>
NUOASIS PROPERTIES, INC.
(A Development Stage Enterprise)
Index to Financial Statements
Description Page
Independent Auditors' Report.................................................F-2
Balance Sheets as of December 31, 1999 (unaudited) and June 30, 1999.........F-3
Statements of Operations and Comprehensive Income (Loss) for the
Six Months Ended December 31, 1999 and 1998 (unaudited), the
Years Ended June 30, 1999 and 1998, and the Period from
Inception, July 19, 1993, Through December 31, 1999 (unaudited)...........F-4
Statements of Stockholder's Equity (Deficit) for the Six Months Ended
December 31, 1999 (unaudited), Years Ended June 30, 1999 and
1998, and the Period from Inception, July 19, 1993, Through
December 31, 1999 (unaudited).............................................F-5
Statements of Cash Flows for the Six Months Ended December 31, 1999
and 1998 (unaudited), the Years Ended June 30, 1999 and 1998,and the
Period from Inception, July 19, 1993,
Through December 31, 1999 (unaudited).....................................F-6
Notes to Financial Statements................................................F-7
F-1
<PAGE>
INDEPENDENT AUDITORS' REPORT
Board of Directors and Stockholder
NuOasis Properties, Inc.
(A Development Stage Enterprise)
Newport Beach, California
We have audited the accompanying balance sheet of NuOasis Properties, Inc.
(A Development Stage Enterprise) (the "Company") as of June 30, 1999, and the
related statements of operations and comprehensive income (loss), stockholder's
equity (deficit) and cash flows for each of the years in the two- year period
then ended. 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.
As discussed in Note 1, the Company's statements of operations and comprehensive
income (loss), stockholder's equity (deficit) and cash flows for the period from
inception, July 19, 1993, through December 31, 1999, have not been audited and
accordingly, we do not express an opinion thereon.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of the Company as of June 30,
1999, and the results of its operations and its cash flows for each of the years
in the two year period then ended, in conformity with generally accepted
accounting principles.
The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As discussed in Note 1 to the
financial statements, the Company has no operations and limited liquid
resources. Such matters raise substantial doubt about the Company's ability to
continue as a going concern. Management's plans regarding those matters are also
described in Note 1. The financial statements do not include any adjustments
that might result from the outcome of this uncertainty.
/s/ HASKELL & WHITE LLP
HASKELL & WHITE LLP
Newport Beach, California
November 18, 1999
F-2
<PAGE>
NUOASIS PROPERTIES, INC.
(A Development Stage Enterprise)
Balance Sheets
<TABLE>
<CAPTION>
December 31, 1999
ASSETS (unaudited) June 30, 1999
<S> <C> <C>
Current assets:
Cash $ 37 $ 37
Marketable equity securities (Notes 1 and 3) 26,220 26,220
Total current assets 26,257 26,257
TOTAL ASSETS $ 26,257 $ 26,257
LIABILITIES AND STOCKHOLDER'S EQUITY
(DEFICIT)
Current liabilities:
Due to affiliates (Notes 2 and 5) $ 91,886 $ 70,886
Commitments and contingencies (Note 5)
Stockholder's equity (deficit) (Note 3):
Common stock, $.001 par value;
75,000,000 shares authorized;
812,500 shares issued and outstanding 813 813
Preferred stock, $.001 par value;
24,000,000 shares authorized;
300,000 shares issued and outstanding 300 300
Additional paid-in-capital 216,686 216,686
Receivable from stockholder (84,587) (84,587)
Accumulated other comprehensive loss (46,740) (46,740)
Deficit accumulated during the developmental stage (152,101) (131,101)
Total stockholder's equity (deficit) (65,629) (44,629)
TOTAL LIABILITIES AND STOCKHOLDER'S
EQUITY (DEFICIT) $ 26,257 $ 26,257
</TABLE>
See accompanying notes to financial statements.
F-3
<PAGE>
NUOASIS PROPERTIES, INC.
(A Development Stage Enterprise)
Statements of Operations and Comprehensive Income (Loss)
<TABLE>
<CAPTION>
For the Period
from Inception,
For the Six Months Ended For the Years Ended July 19, 1993,
December 31, June 30, Through
1999 1998 1999 1998 December 31, 1999
(unaudited) (unaudited) (unaudited)
<S> <C> <C> <C> <C> <C>
Operating expenses:
Management and consulting fees (Note 5) $ 21,000 $ 18,000 $ 36,000 $ 36,000 $ 93,000
General and administrative expenses - 145 145 3,428 27,329
Total operating expenses 21,000 18,145 36,145 39,428 120,329
Other expenses (income
Loss on sale of marketable equity securities - 36,560 36,560 - 36,560
Interest income - (4,788) (4,788) - (4,788)
Total other expenses (income) - 31,772 31,772 - (31,772)
Loss before income tax provision (21,000) (49,917) (67,917) (39,428) (152,101)
Income tax provision - - - - -
Net loss (21,000) (49,917) (67,917) (39,428) (152,101)
Other comprehensive (loss) income:
Unrealized holding loss arising during the period - (16,530) (16,530) (53,000) (69,530)
Reclassification adjustment - 22,790 22,790 - 22,790
Comprehensive loss $ (21,000) $(43,657) $ (61,657) $ (92,428) $ (198,841)
Weighted average number of
common shares outstanding 812,500 812,500 812,500 812,500 812,500
Basic and diluted loss per common share $ (0.03) $ (0.06) $ (0.08) $ (0.05) $ (0.19)
</TABLE>
See accompanying notes to financial statements.
F-4
<PAGE>
NUOASIS PROPERTIES, INC.
(A Development Stage Enterprise)
Statements of Stockholder's Equity (Deficit)
For the Years Ended June 30, 1999 and 1998,
and for the Six Months Ended December 31, 1999 (unaudited)
and for the Period From Inception, July 19, 1993, Through
December 31, 1999 (unaudited)
<TABLE>
<CAPTION>
Accumulated
Common Common Preferred Preferred Additional Receivable Other
Stock Stock Stock Stock Paid-In from Comprehensive Accumulated
Shares Amount Shares Amount Capital Stockholder Income (Loss) Deficit Total
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Initial capitalization (unaudited) 812,500 $ 813 - $ - $ 9,187 $ - $ - $ - $ 10,000
Net loss from inception,
July 19, 1993 through June 30,
1996 (unaudited) - - - - - - - (22,969) (22,969)
Balance at July 1, 1996 812,500 813 - - 9,187 - - (22,969) (12,969)
Net loss for the year ended June 30, 1997 - - - - - - - (787) (787)
Balance at June 30, 1997 812,500 813 - - 9,187 - - (23,756) (13,756)
Issuance of stock for marketable equity
securities and note receivable - - 300,000 300 207,499 (79,799) - - 128,000
Unrealized loss on marketable equity
securities - - - - - - (53,000) - (53,000)
Net loss for the year ended June 30, 1998 - - - - - - - (39,428) (39,428)
Balance at June 30, 1998 812,500 813 300,000 300 216,686 (79,799) (53,000) (63,184) 21,816
Reclassification adjustment related
to disposition of marketable equity - - - - - - 22,790 - 22,790
securities
Unrealized loss on marketable equity
securities - - - - - - (16,530) - (16,530)
Accrued interest receivable - - - - - (4,788) - - (4,788)
Net loss for the year ended June~30, 1999 - - - - - - - (67,917) (67,917)
Balance at June 30, 1999 812,500 813 300,000 300 216,686 (84,587) (46,740) (131,101) (44,629)
Net loss for the six months ended
December 31, 1999 - - - - - - - (21,000) (21,000)
Balance at December 31, 1999
(unaudited) 812,500 $ 813 300,000 $ 300 $216,686 $(84,587) $(46,740) $(152,101)$(65,629)
</TABLE>
See accompanying notes to financial statements.
[H:\NUOP\10SB\1999-8.wpd]
F-5
<PAGE>
NUOASIS PROPERTIES, INC.
(A Development Stage Enterprise)
Statements of Cash Flows
<TABLE>
<CAPTION>
For the Period
From Inception,
For the Six Months For the Years/Ended July 19, 1993,
Ended December 31, June 30, Through
1999 1998 1999 1998 December 31, 1999
(unaudited) (unaudited) (unaudited)
<S> <C> <C> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $(21,000) $ (49,917) $(67,917) $ (39,428) $ (152,101)
Adjustment to reconcile net loss to net
cash used in operating activities: - 36,560 -
Loss on disposition of marketable
equity securities - 36,560 36,560 - 36,560
Accrued interest receivable - (4,788) (4,788) - (4,788)
Net cash used by operating activities (21,000) (18,480) (36,145) (39,428) (120,329)
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from disposition of marketable
equity securities - 18,480 18,480 - 18,480
Net cash provided by investing activities - 18,480 18,480 - 18,480
CASH FLOWS FROM FINANCING ACTIVITIES:
Initial capitalization - - - - 10,000
Net increase in due to affiliates 21,000 (335) 17,500 39,186 91,886
Net cash provided by financing activities 21,000 (335) 17,500 39,186 101,886
Net (decrease) increase in cash - - (165) (242) 37
Cash, beginning of period 37 202 202 444 -
Cash, end of period $ 37 $ 202 $ 37 $ 202 $ 37
SUPPLEMENTAL DISCLOSURE OF CASH FLOW
INFORMATION:
Cash paid during the year for:
Interest $ - $ - $ - $ - $ -
Income taxes $ - $ - $ - $ - $ -
Non-cash investing and financing activities:
Marketable equity securities, net
of unrealized loss, and note receivable
received for preferred stock (Note 3) $ - $ - $ - $ 154,799 $ 154,799
</TABLE>
See accompanying notes to financial statements.
[H:\NUOP\10SB\1999-8.wpd]
F-6
<PAGE>
NUOASIS PROPERTIES, INC.
(A Development Stage Enterprise)
Notes to Financial Statements
December 31,1999 (unaudited)
and June 30, 1999
1. Description of Business and Summary of Significant Accounting Policies
Description of Business and Basis of Presentation
NuOasis Properties, Inc. (a Development Stage Enterprise) (the "Company"),
formerly Morelli Capital, Inc. ("MCI") was incorporated in Colorado in July
1993. In January 1995, the Company changed its name to NuOasis Properties, Inc.
In April 1997, the Company merged into a Nevada corporation with the same name.
The Company is a wholly owned subsidiary of NuOasis Resorts, Inc. ("NuOasis"), a
publicly held company. Since its inception, the Company has not conducted any
significant operations.
The Company's activities to date have focused primarily on incorporation
activities and the identification of potential operating opportunities or
acquisitions targets. Since the Company has not yet commenced any principle
operations, and has not yet earned significant revenues, the Company is
considered to be a development stage enterprise as of December 31, 1999 and June
30, 1999.
Unaudited Financial Information
The accompanying interim financial statements as of December 31, 1999 and
the six months ended December 31, 1999 and 1998 are unaudited but include all
adjustments, consisting of only normal recurring adjustments, which management
considers necessary to present fairly, in all material respects, the financial
position and results of operations and cash flows for the six months ended
December 31, 1999 and 1998. Certain information and footnote disclosures
normally included in the annual financial statements prepared in accordance with
generally accepted accounting principles have been omitted. Results of the six
months ended December 31, 1999 are not necessarily indicative of the results for
the entire year.
In the opinion of the Company's management, the accompanying unaudited
financial statements for the period from inception, July 19, 1993, through
December 31, 1999, include all adjustments necessary for a fair presentation of
the results of operations and cash flows.
Management Estimates
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 revenues and expenses during the
reporting period. Actual results could differ from those estimates.
[H:\NUOP\10SB\1999-8.wpd]
F-7
<PAGE>
NUOASIS PROPERTIES, INC.
(A Development Stage Enterprise)
Notes to Financial Statements (continued)
December 31,1999 (unaudited)
and June 30, 1999
1. Description of Business and Summary of Significant Accounting Policies
(continued)
Marketable Equity Securities
As of June 30, 1998, the Company owned 1,000,000 shares of restricted
common stock of its parent, NuOasis (Note 3). Management classified these equity
securities as available-for-sale based on its intent to exchange the equity
securities for other assets. In accordance with SFAS No. 115, these equity
securities were presented in the June 30, 1998 balance sheet as current assets
at their estimated fair market values. At June 30, 1999 and 1998, the Company
recorded an unrealized loss on these securities of $46,740 and $53,000,
respectively, as their carrying values exceeded the equity securities' estimated
fair market value, which was determined by considering factors such as the
closing price of NuOasis' common stock on June 30, 1999 and 1998, and trading
restrictions on the securities. During the year ended June 30, 1999, the Company
disposed of 430,000 shares of NuOasis common stock and realized losses
aggregating $36,560.
Loss Per Share
SFAS No. 128, "Earnings Per Share," requires the disclosure of "basic" and
"diluted" earnings (loss) per share. Basic earnings (loss) per share is computed
by dividing net income (loss) by the weighted average number of common shares
outstanding during each period. Diluted earnings (loss) per share is similar to
basis earnings (loss) per share except that the weighted average number of
common shares outstanding is increased to reflect the dilutive effect of
potential common shares, such as those issuable upon the exercise of stock
options or warrants, and the conversion of preferred stock, as if they had been
issued.
For both of the years ended June 30, 1999 and 1998 and for the period from
inception, July 19, 1993, through December 31, 1999, there is no difference
between basic and diluted loss per common share as the Company incurred a net
loss in each of these periods.
Income Taxes
The Company accounts for income taxes in accordance with SFAS No. 109,
"Accounting for Income Taxes," which requires the use of the "liability method"
of accounting for income taxes. Accordingly, deferred tax assets and
liabilities, are determined based on the difference between the financial
statement and tax bases of assets and liabilities, using enacted tax rates in
effect for the year in which the differences are expected to reverse. Current
income taxes are based on the year's income taxable for federal and state income
tax reporting purposes.
Recent Accounting Standards
In June 1997, the FASB issued SFAS No. 130, "Reporting Comprehensive
Income." This Statement establishes standards for the reporting and display of
comprehensive income and its components (revenues, expenses, gains and losses)
in an entity's financial statements. This statement requires an entity to
classify items of other comprehensive income by their nature in a financial
statement and display the accumulated balance of other comprehensive income
separately from retained earnings and additional paid-in-capital in the equity
section of a statement of financial position. In accordance with the provisions
of this statement, the Company has adopted SFAS No. 130 in the accompanying
financial statements.
[H:\NUOP\10SB\1999-8.wpd]
F-8
<PAGE>
NUOASIS PROPERTIES, INC.
(A Development Stage Enterprise)
Notes to Financial Statements (continued)
December 31,1999 (unaudited)
and June 30, 1999
1. Description of Business and Summary of Significant Accounting
Policies (continued)
Recent Accounting Standards (continued)
In June 1997, the FASB issued SFAS No. 131, "Disclosures about Segments of
an Enterprise and Related Information." This statement requires public
enterprises to report financial and descriptive information about its reportable
operating segments, and establishes standards for related disclosures about
products and services, geographic areas, and major customers. As of June 30,
1999 and 1998, management determined that the Company had only one reportable
operating segment.
Going Concern and Management's Plans
The Company has not commenced significant operations, and has limited
liquid resources. Such matters raise substantial doubt about the Company's
ability to continue as a going concern. Management's plans with respect to these
conditions are to continue searching for additional sources of capital and new
operating opportunities. In the interim, the Company will continue operating
with minimal overhead, and key administrative and management functions will be
provided by consultants, NuOasis or NuVen Advisors, Inc. (Note 5). Accordingly,
the accompanying financial statements have been presented under the assumption
the Company will continue as a going concern.
2. Related Party Transactions
As of June 30, 1999, the Company had $5,100 due to NuOasis (Note 3). The
Company also had $65,786 due to NuVen Advisors Inc., an entity that is owned by
officers of NuOasis and the Company. Such amounts do not bear interest, are
uncollateralized and have no stated repayment terms. The Company has an Advisory
and Management Agreement with NuVen Advisors, Inc., that is described in Notes 5
and 6.
As discussed in Note 3, the Company also had $84,587 due from NuOasis.
3. Equity Transactions
Issuance of Preferred Stock
In March 1998, the Company issued 300,000 shares of its undesignated
Preferred Stock to NuOasis. In exchange for the 300,000 shares of undesignated
Preferred Stock, the Company received 1,000,000 shares of NuOasis' common stock
and a $79,799 note receivable. As of June~30, 1999, the note receivable
outstanding, plus accrued interest of $4,788, aggregated $84,587. The note
receivable bears interest at 6%, is uncollateralized and is due in April 2001.
[H:\NUOP\10SB\1999-8.wpd]
F-9
<PAGE>
NUOASIS PROPERTIES, INC.
(A Development Stage Enterprise)
Notes to Financial Statements (continued)
December 31,1999 (unaudited)
and June 30, 1999
3. Equity Transactions (continued)
Stock Split
In April 1998, the Company effected a 3.077 for one common stock split. Related
common stock and per share amounts have been retroactively adjusted in the
accompanying financial statements.
4. Income Taxes
Because the Company has substantially no assets of liabilities at June 30,
1999, and has conducted no significant operations to date, the Company has
recorded no deferred tax assets or liabilities, and has recorded no provision
for income taxes in the accompanying financial statements. As of June 30, 1999,
the Company has approximately $131,000 and $125,000 of federal and state
operating loss carryforwards, which begin to expire in 2008 and 1999,
respectively.
The Tax Reform Act of 1986 contains certain provisions which may
substantially limit the availability of the net operating loss carryforwards if
there is a greater than 50% change in ownership during a three-year period. The
limitation is based on the value of the Company on the date that the change in
ownership occurs, and the ultimate realization of any loss carryforwards is
dependent on the extent of the limitation, and the future profitability of the
company.
5. Commitments and Contingencies
Year 2000
The Company does not believe that the impact of the year 2000 computer
issue will have a significant impact on its operations or financial position.
Furthermore, the Company does not believe that it will be required to
significantly modify its internal computer systems. However, if internal systems
do not correctly recognize date information in the year 2000, there could be an
adverse impact on the Company's operations. Furthermore, there can be no
assurance that another entity's failure to ensure year 2000 capability would not
have an adverse effect on the Company.
Advisory and Management Agreement
In February 1994, and subsequently amended in January 1998, the Company entered
into an Advisory and Management Agreement (the "Agreement") with NuVen Advisors,
Inc., an entity owned by officers of the Company and officers of NuOasis.
Pursuant to the terms of the Agreement, the Company is required to pay $3,000
per month, plus expenses, in exchange for NuVen Advisors, Inc.'s assistance in
the formulation of possible acquisition strategies, and the management of
financial and general and administrative matters. In addition, the Company is
required to pay a fee equal to 5% of the value of each business opportunity (as
defined) introduced by NuVen Advisors, Inc. The Agreement has an initial term of
five years, but was canceled effective July 1, 1999 and was replaced with a
revised agreement described in Note 6. In connection with the Agreement, the
Company has recorded $36,000 of management and consulting fees in each of fiscal
1999 and 1998, and such amounts are included in the fiscal 1999 and 1998
statements of operations and comprehensive income (loss). The Agreement was
terminated by written mutual consent on or around June 30, 1999.
[H:\NUOP\10SB\1999-8.wpd]
F-10
<PAGE>
NUOASIS PROPERTIES, INC.
(A Development Stage Enterprise)
Notes to Financial Statements (continued)
December 31,1999 (unaudited)
and June 30, 1999
6. Subsequent Event
Effective July 1, 1999, the Company entered into a revised Advisory and
Management Agreement (the "Revised Agreement") with NuVen Advisors, Limited
Partnership, an entity owned by officers of the Company and officers of NuOasis.
Pursuant to the terms of the Revised Agreement, the Company is required to pay
$3,500 per month, plus expenses, in exchange for NuVen Advisors, Limited
Partnership's assistance in the formulation of possible acquisition strategies,
and the management of financial and general and administrative matters. In
addition, the Company is required to pay a fee equal to 10% of the asset value
or investment made in the Company resulting from NuVen Advisors, Limited
Partnership's efforts, and a fee equal to 5% of the proceeds received by the
Company in connection with a sale of its assets. In addition, the Company
granted a fully vested option to NuVen Advisors, Limited Partnership to purchase
500,000 shares of the Company's common stock at $0.50 per share. The Revised
Agreement has an initial term of five years, but shall be automatically extended
on an annual basis, unless terminated by either party.
[H:\NUOP\10SB\1999-8.wpd]
F-11
EXHIBITS
EXHIBIT 3.1
ARTICLES OF INCORPORATION
OF
NuOASIS PROPERTIES INC.
The undersigned proposes to form a corporation under the laws of the State
of Nevada, relating to private corporations and to that end hereby adopts
articles of incorporation as follows:
ARTICLE ONE
NAME
The name of the corporation is NU OASIS PROPERTIES, INC.
ARTICLE TWO
LOCATION
The principal office of this corporation is to be at 4550 WEST OAKEY BOULEVARD,
SUITE #111-W, LAS VEGAS, NEVADA 89102.
ARTICLE THREE
PURPOSES
This corporation is authorized to carry on any lawful business or enterprise.
ARTICLE FOUR
CAPITAL STOCK
The amount of the total authorized capital stock of this corporation is 25,000
SHARES AT NO PAR VALUE. Such shares are non-assessable.
ARTICLE FIVE
DIRECTORS
The members of the governing board of this corporation shall be styled
directors. There will be one member to the first Board of Directors. The name
and address of the member of the first Board of Directors is: JULIE RODRIGUEZ,
c/o FAR WEST LEGAL SERVICE INC., A NEVADA CORPORATION, 4550 WEST OAKEY BLVD.,
SUITE #111-W, LAS VEGAS, NEVADA 89102.
Directors shall have no personal liability to the corporation or its
stockholders for damages for breach of fiduciary duty as a director. This
provision does not eliminate or limit the liability of a director for acts or
omissions which involve intentional misconduct, fraud or a knowing violation of
law of the payment of dividends in violation of NRS 78.300.
[H:\NUOP\10SB\1999-8.wpd]
<PAGE>
ARTICLE SIX
INCORPORATORS
The name and address of the incorporator is JULIE RODRIGUEZ, c/o FAR WEST
LEGAL SERVICE INC., A NEVADA CORPORATION, 4550 WEST OAKEY BOULEVARD, SUITE
#111-W, LAS VEGAS, NEVADA 89102.
ARTICLE SEVEN
PERIOD OF EXISTENCE
The period of existence of this corporation shall be perpetual.
ARTICLE EIGHT
AMENDMENT OF ARTICLES OF INCORPORATION
The articles of incorporation of the corporation may be amended from time
to time by a majority vote of all shareholders voting by written ballot in
person or by proxy held at any general or special meeting of shareholders upon
lawful notice.
ARTICLE NINE
STATUTORY RESIDENT AGENT
The corporation does hereby name, constitute and appoint as its statutory
resident agent within the State of Nevada for receipt of process of any other
lawful purpose, FAR WEST LEGAL SERVICE INC., A NEVADA CORPORATION, 4550 WEST
OAKEY BOULEVARD, SUITE #111-W, LAS VEGAS, NEVADA 89102. This appointment of
resident agent shall be continuous unless otherwise changed by the Board of
Directors of the corporation acting pursuant to the laws of the State of Nevada.
ARTICLE TEN
VOTING OF SHARES
In any election participated in by the shareholders, each shareholder shall
have one vote for each share of stock he owns, either in person or by proxy as
provided by law. Cumulative voting shall not prevail in any election by the
shareholders of this corporation.
IN WITNESS WHEREOF the undersigned, JULIE RODRIGUEZ for the purpose of
forming a corporation under the laws of the State of Nevada, does make, file and
record these articles, and certifies that the facts herein stated are true; and
I have accordingly hereunto set my hand this 14th day of March, 1997.
INCORPORATOR:
/s/ Julie Rodriguez
[H:\NUOP\10SB\1999-8.wpd]
<PAGE>
STATE OF CALIFORNIA
COUNTY OF RIVERSIDE
On 14th day of March, 1997 before me, Joanne W. Smith, personally appeared
JULIE RODRIGUEZ personally known to me (or proved to me on the basis of
satisfactory evidence) to be the person whose name is subscribed to the within
instrument and acknowledged to me that she executed the same in her authorized
capacity, and that by her signature on the instrument the person or the entity
upon behalf of which the person acted, executed the instrument.
WITNESS by hand and official seal.
/s/ Joanne W. Smith
SIGNATURE OF NOTARY
Notary stamp or seal
Date 3-14-97
CERTIFICATE OF ACCEPTANCE
OF APPOINTMENT BY RESIDENT AGENT
FAR WEST LEGAL SERVICE INC., A NEVADA CORPORATION hereby certifies that on
the 14th day of March 1997, we accepted appointment as Resident Agent for NU
OASIS PROPERTIES, INC. in accordance with Section 78.090, NRS 1957.
Furthermore, FAR WEST LEGAL SERVICE INC., A NEVADA CORPORATION hereby
certifies that the principal office in this state is located at 4550 WEST OAKEY
BLVD., SUITE #111-W, LAS VEGAS, NEVADA 89102.
In Witness Whereof, I have hereunto set my hand this 14th day of March, 1997.
/s/ Julie Rodriguez
JULIE RODRIGUEZ
FAR WEST LEGAL SERVICE, INC.,
a NEVADA CORPORATION
[H:\NUOP\10SB\1999-8.wpd]
EXHIBIT 3.2
BYLAWS
OF
NuOASIS PROPERTIES, INC.
ARTICLE I
OFFICES
Section 1. The registered office shall be in Las Vegas, Nevada.
Section 2. The corporation may also have offices at such other places
both within and without the State of Nevada as the board of directors may
from time to time determine or the business of the corporation may require.
ARTICLE II
MEETINGS OF STOCKHOLDERS
Section l. All annual meetings of the stockholders shall be held in the
City of Las Vegas, State of Nevada. Special meetings of the stockholders may be
held at such time and place within or without the State of Nevada as shall be
stated in the notice of the meeting, or in a duly executed waiver of notice
thereof.
Section 2. Annual meetings of stockholders shall be held on November 1st,
if not a legal holiday, and if a legal holiday, then on the next secular day
following, at 10:00~A.M., at which they shall elect by a plurality vote a board
of directors, and transact such other business as may properly be brought before
the meeting.
<PAGE>
Section 3. Special meetings of the stockholders, for any purpose or
purposes, unless otherwise prescribed by statute or by the articles of
incorporation, may be called by the president and shall be called by the
president or secretary at the request in writing of a majority of the board of
directors, or at the request in writing of stockholders owning a majority in
amount of the entire capital stock of the corporation issued and outstanding and
entitled to vote. Such request shall state the purpose or purposes of the
proposed meeting.
Section 4. Notices of meetings shall be in writing and signed by the
president or a vice president, or the secretary, or an assistant secretary, or
by such other person or persons as the directors shall designate. Such notice
shall state the purpose or purposes for which the meeting is called and the time
when and the place where it is to be held. A copy of such notice shall be either
delivered personally to or shall be mailed, postage prepaid, to each stockholder
of record entitled to vote at such meeting not less than ten nor more than sixty
days before such meeting. If mailed, it shall be directed to a stockholder at
his address as it appears upon the records of the corporation and upon such
mailing of any such notice, the service thereof shall be complete, and the time
of the notice shall begin to run from the date upon which such notice is
deposited in the mail for transmission to such stockholder. Personal delivery of
any such notice to any officer of a corporation or association, or to any member
of a partnership shall constitute delivery of such notice to such corporation,
association or partnership. In the event of the transfer of stock after delivery
or mailing of the notice of and prior to the holding of the meeting it shall not
be necessary to deliver or mail notice of the meeting to the transferee.
Section 5. Business transacted at any special meeting of stockholders shall
be limited to the purposes stated in the notice.
Section 6. The holders of a majority of the stock issued and outstanding
and entitled to vote thereat, present in person or represented by proxy, shall
constitute a quorum at all meetings of the stockholders for the transaction of
business except as otherwise provided by statute or by the articles of
incorporation. If, however, such quorum shall not be present or represented at
any meeting of the stockholders, the stockholders entitled to vote thereat,
present in person or represented by proxy, shall have power to adjourn the
meeting from time to time, without notice other than announcement at the
meeting, until a quorum shall be present or represented. At such adjourned
meeting at which a quorum shall be present or represented, any business may be
transacted which might have been transacted at the meeting as originally
notified.
<PAGE>
Section 7. When a quorum is present or represented at any meeting, the vote
of the holders of a majority of the stock having voting power present in person
or represented by proxy shall decide any question brought before such meeting,
unless the question is one upon which by express provision of the statutes or of
the articles of incorporation a different vote is required in which case such
express provision shall govern and control the decision of such question.
Section 8. Every stockholder of record of the corporation shall be entitled
at each meeting of stockholders to one vote for each share of stock standing in
his name on the books of the corporation.
Section 9. At any meeting of the stockholders, any stockholder may be
represented and vote by a proxy or proxies appointed by an instrument in
writing. In the event that any such instrument in writing shall designate two or
more persons to act as proxies, a majority of such persons present at the
meeting, or, if only one shall be present, then that one shall have and may
exercise all of the powers conferred by such written instrument upon all of the
persons so designated unless the instrument shall otherwise provide. No such
proxy shall be valid after the expiration of six months from the date of its
execution, unless coupled with an interest, or unless the person executing it
specifies therein the length of time for which it is to continue in force, which
in no case shall exceed seven years from the date of its execution. Subject to
the above, any proxy duly executed is not revoked and continues in full force
and effect until an instrument revoking it or a duly executed proxy bearing a
later date is filed with the secretary of the corporation.
<PAGE>
Section 10. Any action, which may be taken by the vote of the stockholders
at a meeting, may be taken without a meeting if authorized by the written
consent of stockholders holding at least a majority of the voting power, unless
the provisions of the statutes or of the articles of incorporation require a
greater proportion of voting power to authorize such action in which case such
greater proportion of written consents shall be required.
ARTICLE III
DIRECTORS
Section l. The number of directors shall be neither more than 5 nor less
than 3. The number of directors is to be fixed by vote of the shareholders. The
directors shall be elected at the annual meeting of the stockholders, and except
as provided in Section 2 of this article, each director elected shall hold
office until his successor is elected and qualified. Directors need not be
stockholders.
Section 2. Vacancies, including those caused by an increase in the number
of directors, may be filled by a majority of the remaining directors though less
than a quorum. When one or more directors shall give notice of his or their
resignation to the board, effective at a future date, the board shall have power
to fill such vacancy or vacancies to take effect when such resignation or
resignations shall become effective, each director so appointed to hold office
during the remainder of the term of office of the resigning director or
directors.
Section 3. The business of the corporation shall be managed by its board of
directors which may exercise all such powers of the corporation and do all such
lawful acts and things as are not by statute or by the articles of incorporation
or by these by-laws directed or required to be exercised or done by the
stockholders.
<PAGE>
MEETINGS OF THE BOARD OF DIRECTORS
Section 4. The board of directors of the corporation may hold meetings,
both regular and special, either within or without the State of Nevada.
Section 5. The first meeting of each newly elected board of directors shall
be held at such time and place as shall be fixed by the vote of the stockholders
at the annual meeting and no notice of such meeting shall be necessary to the
newly elected directors in order legally to constitute the meeting, provided a
quorum shall be present. In the event of the failure of the stockholders to fix
the time or place of such first meeting of the newly elected board of directors,
or in the event such meeting is not held at the time and place so fixed by the
stockholders, the meeting may be held at such time and place as shall be
specified in a notice given as hereinafter provided for special meetings of the
board of directors, or as shall be specified in a written waiver signed by all
of the directors.
Section 6. Regular meetings of the board of directors may be held without
notice at such time and place as shall from time to time be determined by the
board.
Section 7. Special meetings of the board of directors may be called by the
president or secretary on the written request of one director. Written notice of
special meetings of the board of directors shall be given to each director at
least 3 days before the date of the meeting.
Section 8. A majority of the board of directors, at a meeting duly
assembled, shall be necessary to constitute a quorum for the transaction of
business and the act of a majority of the directors present at any meeting at
which a quorum is present shall be the act of the board of directors, except as
may be otherwise specifically provided by statute or by the articles of
incorporation. Any action required or permitted to be taken at a meeting of the
directors may be taken without a meeting if a consent in writing, setting forth
the action so taken, shall be signed by all of the directors entitled to vote
with respect to the subject matter thereof.
<PAGE>
COMMITTEES OF DIRECTORS
Section 9. The board of directors may, by resolution passed by a majority
of the whole board, designate one or more committees, each committee to consist
of one or more of the directors of the corporation, which, to the extent
provided in the resolution, shall have and may exercise the powers of the board
of directors in the management of the business and affairs of the corporation,
and may have power to authorize the seal of the corporation to be affixed to all
papers on which the corporation desires to place a seal. Such committee or
committees shall have such name or names as may be determined from time to time
by resolution adopted by the board of directors.
Section 10. The committees shall keep regular minutes of their proceedings
and report the same to the board when required.
COMPENSATION OF DIRECTORS
Section 11. The directors may be paid their expenses, if any, of attendance
at each meeting of the board of directors and may be paid a fixed sum for
attendance at each meeting of the board of directors or a stated salary as
director. No such payment shall preclude any director from serving the
corporation in any other capacity and receiving compensation therefor. Members
of special or standing committees may be allowed like compensation for attending
committee meetings.
<PAGE>
ARTICLE IV
NOTICES
Section l. Notices to directors and stockholders shall be in writing and
delivered personally or mailed to the directors or stockholders at their
addresses appearing on the books of the corporation. Notice by mail shall be
deemed to be given at the time when the same shall be mailed. Notice to
directors may also be given by facsimile telecommunication.
Section 2. Whenever all parties entitled to vote at any meeting, whether of
directors or stockholders, consent, either by a writing on the records of the
meeting or filed with the secretary, or by presence at such meeting and oral
consent entered on the minutes, or by taking part in the deliberations at such
meeting without objection, the doings of such meeting shall be as valid as if
had at a meeting regularly called and noticed, and at such meeting any business
may be transacted which is not excepted from the written consent or to the
consideration of which no objection for want of notice is made at the time, and
if any meeting be irregular for want of notice or of such consent, provided a
quorum was present at such meeting, the proceedings of said meeting may be
ratified and approved and rendered likewise valid and the irregularity or defect
therein waived by a writing signed by all parties having the right to vote at
such meetings; and such consent or approval of stockholders may be by proxy or
attorney, but all such proxies and powers of attorney must be in writing.
Section 3. Whenever any notice whatever is required to be given under the
provisions of the statutes, of the articles of incorporation or of these
by-laws, a waiver thereof in writing, signed by the person or persons entitled
to said notice, whether before or after the time stated therein, shall be deemed
equivalent thereto.
<PAGE>
ARTICLE V
OFFICERS
Section l. The officers of the corporation shall be chosen by the board of
directors and shall be a president, a vice president, a secretary and a
treasurer. Any person may hold two or more offices.
Section 2. The board of directors at its first meeting after each annual
meeting of stockholders shall choose a president, a vice president, a secretary
and a treasurer, none of whom need be a member of the board.
Section 3. The board of directors may appoint additional vice presidents,
and assistant secretaries and assistant treasurers and such other officers and
agents as it shall deem necessary who shall hold their offices for such terms
and shall exercise such powers and perform such duties as shall be determined
from time to time by the board.
Section 4. The salaries of all officers and agents of the corporation shall
be fixed by the board of directors.
Section 5. The officers of the corporation shall hold office until their
successors are chosen and qualify. Any officer elected or appointed by the board
of directors may be removed at any time by the affirmative vote of a majority of
the board of directors. Any vacancy occurring in any office of the corporation
by death, resignation, removal or otherwise shall be filled by the board of
directors.
THE PRESIDENT
Section 6. The president shall be the chief executive officer of the
corporation, shall preside at all meetings of the stockholders and the board of
directors, shall have general and active management of the business of the
corporation, and shall see that all orders and resolutions of the board of
directors are carried into effect.
<PAGE>
Section 7. He shall execute bonds, mortgages and other contracts requiring
a seal, under the seal of the corporation, except where required or permitted by
law to be otherwise signed and executed and except where the signing and
execution thereof shall be expressly delegated by the board of directors to some
other officer or agent of the corporation.
THE VICE PRESIDENT
Section 8. The vice president shall, in the absence or disability of the
president, perform the duties and exercise the powers of the president and shall
perform such other duties as the board of directors may from time to time
prescribe.
THE SECRETARY
Section 9. The secretary shall attend all meetings of the board of
directors and all meetings of the stockholders and record all the proceedings of
the meetings of the corporation and of the board of directors in a book to be
kept for that purpose and shall perform like duties for the standing committees
when required. He shall give, or cause to be given, notice of all meetings of
the stockholders and special meetings of the board of directors, and shall
perform such other duties as may be prescribed by the board of directors or
president, under whose supervision he shall be. He shall keep in safe custody
the seal of the corporation and, when authorized by the board of directors,
affix the same to any instrument requiring it and, when so affixed, it shall be
attested by his signature or by the signature of the treasurer or an assistant
secretary.
<PAGE>
THE TREASURER
Section 10. The treasurer shall have the custody of the corporate funds and
securities and shall keep full and accurate accounts of receipts and
disbursements in books belonging to the corporation and shall deposit all moneys
and other valuable effects in the name and to the credit of the corporation in
such depositories as may be designated by the board of directors.
Section 11. He shall disburse the funds of the corporation as may be
ordered by the board of directors taking proper vouchers for such disbursements,
and shall render to the president and the board of directors, at the regular
meetings of the board, or when the board of directors so requires, an account of
all his transactions as treasurer and of the financial condition of the
corporation.
Section 12. If required by the board of directors, he shall give the
corporation a bond in such sum and with such surety or sureties as shall be
satisfactory to the board of directors for the faithful performance of the
duties of his office and for the restoration to the corporation, in case of his
death, resignation, retirement or removal from office, of all books, papers,
vouchers, money and other property of whatever kind in his possession or under
his control belonging to the corporation.
ARTICLE VI
CERTIFICATES OF STOCK
Section l. Every stockholder shall be entitled to have a certificate,
signed by the president or a vice president and the treasurer or an assistant
treasurer, or the secretary or an assistant secretary of the corporation,
certifying the number of shares owned by him in the corporation. If the
corporation is authorized to issue shares of more than one class or more than
one series of any class, there shall be set forth upon the face or back of the
certificate, or the certificate shall have a statement that the corporation will
furnish to any stockholders upon request and without charge, a full or summary
statement of the designations, preferences and relative, participating, optional
or other special rights of the various classes of stock or series thereof and
the qualifications, limitations or restrictions of such rights, and, if the
corporation shall be authorized to issue only special stock, such certificate
shall set forth in full or summarize the rights of the holders of such stock.
<PAGE>
Section 2. Whenever any certificate is countersigned or otherwise
authenticated by a transfer agent or transfer clerk, and by a registrar, then a
facsimile of the signatures of the officers or agents of the corporation may be
printed or lithographed upon such certificate in lieu of the actual signatures.
In case any officer or officers who shall have signed, or whose facsimile
signature or signatures shall have been used on, any such certificate or
certificates shall cease to be such officer or officers of the corporation,
whether because of death, resignation or otherwise, before such certificate or
certificates shall have been delivered by the corporation, such certificate or
certificates may nevertheless be adopted by the corporation and be issued and
delivered as though the person or persons who signed such certificate or
certificates, or whose facsimile signature or signatures shall have been used
thereon, had not ceased to be an officer or officers of such corporation.
LOST CERTIFICATES
Section 3. The board of directors may direct a new certificate or
certificates to be issued in place of any certificate or certificates
theretofore issued by the corporation alleged to have been lost or destroyed,
upon the making of an affidavit of that fact by the person claiming the
certificate of stock to be lost or destroyed. When authorizing such issue of a
new certificate or certificates, the board of directors may, in its discretion
and as a condition precedent to the issuance thereof, require the owner of such
lost or destroyed certificate or certificates, or his legal representative, to
advertise the same in such manner as it shall require and/or give the
corporation a bond in such sum as it may direct as indemnity against any claim
that may be made against the corporation with respect to the certificate alleged
to have been lost or destroyed.
<PAGE>
TRANSFER OF STOCK
Section 4. Upon surrender to the corporation or the transfer agent of the
corporation of a certificate for shares duly endorsed or accompanied by proper
evidence of succession, assignment or authority to transfer, it shall be the
duty of the corporation to issue a new certificate to the person entitled
thereto, cancel the old certificate and record the transaction upon its books.
CLOSING OF TRANSFER BOOKS
Section 5. The directors may prescribe a period not exceeding sixty days
prior to any meeting of the stockholders during which no transfer of stock on
the books of the corporation may be made, or may fix a day not more than sixty
days prior to the holding of any such meeting as the day as of which
stockholders entitled to notice of and to vote at such meeting shall be
determined; and only stockholders of record on such day shall be entitled to
notice or to vote at such meeting.
REGISTERED STOCKHOLDERS
Section 6. The corporation shall be entitled to recognize the exclusive
right of a person registered on its books as the owner of shares to receive
dividends, and to vote as such owner, and to hold liable for calls and
assessments a person registered on its books as the owner of shares, and shall
not be bound to recognize any equitable or other claim to or interest in such
share or shares on the part of any other person, whether or not it shall have
express or other notice thereof, except as otherwise provided by the laws of
Nevada.
<PAGE>
ARTICLE VII
GENERAL PROVISIONS
DIVIDENDS
Section l. Dividends upon the capital stock of the corporation, subject to
the provisions of the articles of incorporation, if any, may be declared by the
board of directors at any regular or special meeting pursuant to law. Dividends
may be paid in cash, in property, or in shares of the capital stock, subject to
the provisions of the articles of incorporation.
Section 2. Before payment of any dividend, there may be set aside out of
any funds of the corporation available for dividends such sum or sums as the
directors from time to time, in their absolute discretion, think proper as a
reserve or reserves to meet contingencies, or for equalizing dividends, or for
repairing or maintaining any property of the corporation, or for such other
purpose as the directors shall think conducive to the interest of the
corporation, and the directors may modify or abolish any such reserves in the
manner in which it was created.
CHECKS
Section 3. All checks or demands for money and notes of the corporation
shall be signed by such officer or officers or such other person or persons as
the board of directors may from time to time designate.
FISCAL YEAR
Section 4. The fiscal year of the corporation shall be fixed by resolution
of the board of directors.
<PAGE>
SEAL
Section 5. The corporate seal shall have inscribed thereon the name of the
corporation, the year of its incorporation and the words "Corporate Seal,
Nevada."
ARTICLE VIII
AMENDMENTS
Section l. These by-laws may be altered or repealed at any regular meeting
of the stockholders or of the board of directors or at any special meeting of
the stockholders or of the board of directors if notice of such alteration or
repeal be contained in the notice of such special meeting.
I, THE UNDERSIGNED, being the secretary of NuOasis Properties, Inc., DO
HEREBY CERTIFY the foregoing to be the by-laws of said corporation, as adopted
at a meeting of the directors held on the 17th day of March, 1997.
/s/ Jon L. Lawver
Jon L. Lawver
[H:\NUOP\10SB\1999-8.wpd]
EXHIBIT 4.1
INCORPORATED UNDER THE LAWS OF THE STATE OF THE
STATE OF NEVADA
Number Shares
____________ ___________
NuOasis Properties, Inc.
This corporation is authorized to issue 75,000,000 Common Stock at $.001
Par Value
This Certifies that is the owner of
fully paid and non-assessable
shares of the above Corporation transferable only on the books of the
Corporation by the holder hereof in person or by duly authorized Attorney upon
surrender of this Certificate properly endorsed.
In Witness Whereof, the said Corporation has caused this Certificate to be
signed by its duly authorized officers and its Corporate Seal to be hereunto
affixed this______day of_______________A.D.
19_______.
President Secretary/Treasurer
[H:\NUOP\10SB\1999-8.wpd]
EXHIBIT 10.1
ADVISORY AGREEMENT
THIS ADVISORY AGREEMENT ("Agreement") is made effective the 1st day of July
1999, by and between NuVen Advisors, Limited Partnership, a Nevada Limited
Partnership ("Advisor") and NuOasis Properties, Inc., a Utah corporation (the
"Company").
WHEREAS, Advisor and Advisor's Personnel (as defined below) have experience
in evaluating and effecting mergers and acquisitions, supervising corporate
management, and in performing general administrative duties for publicly-held
companies and development stage investment ventures; and
WHEREAS, the Company desires to retain Advisor to advise and assist the
Company in its development on the terms and conditions set forth below.
NOW, THEREFORE, in consideration of the mutual promises, covenants and
agreements contained herein, and for other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the Company and Advisor
agree as follows:
1. Engagement
The Company hereby retains Advisor, effective the date hereof and
continuing until termination, as provided herein, to assist the Company in
its effecting the purchase of businesses and assets relative to its
business and growth strategy (the "Services"). The Services are to be
provided on a "best efforts" basis directly and through Advisor's officers
or others employed or retained and under the direction of Advisor
("Advisor's Personnel"); provided, however, that the Services shall
expressly exclude capital raising activities of any nature and all legal
advice, accounting services or other services which require licenses or
certification which Advisor may not have.
2. Term
This Agreement shall have an initial term of five (5) years (the "Primary
Term") from the effective date of July 1, 1999. At the conclusion of the
Primary Term this Agreement will automatically be extended on an annual
basis (the "Extension Period") unless Advisor or the Company shall serve
written notice on the other party terminating the Agreement. Any notice to
terminate given hereunder shall be in writing and shall be delivered at
least thirty (30) days prior to the end of the Primary Term or any
subsequent Extension Period.
3. Time and Effort of Advisor
Advisor shall allocate time and Advisors Personnel as it deems necessary to
provide the Services. The particular amount of time may vary from day to
day or week to week. Except as otherwise agreed, Advisor's monthly
statement identifying, in general, tasks performed for the Company shall be
conclusive evidence that the Services have been performed. Additionally, in
the absence of willful misfeasance, bad faith, negligence or reckless
disregard for the obligations or duties hereunder by Advisor, neither
Advisor nor Advisor's Personnel shall be liable to the Company or any of
its shareholders for any act or omission in the course of or connected with
rendering the Services, including but not limited to losses that may be
sustained in any corporate act in any subsequent Business Opportunity (as
defined herein) undertaken by the Company as a result of advice provided by
Advisor or Advisor's Personnel.
[H:\NUOP\10SB\1999-8.wpd]
<PAGE>
4. Compensation
The Company agrees to pay Advisor a fee for the services provided by
Advisor pursuant to this Agreement, as follows:
A. Advisory Fee: The Company shall pay Advisor a monthly fee ("Advisory
Fee") equal to Three Thousand Five Hundred Dollars ($3,500), payable
monthly in advance, in cash or shares of the Company's common stock,
at the Company's election, with such shares to be registered as set
forth herein;
B. Merger Fee: As to Services provided by Advisor related to the
introduction of Business Opportunities which results in a Merger
Transaction or which the Company acquires or otherwise obtain an
equity interest or interest as a creditor, the Company agrees to pay
Advisor a transaction fee (the "Merger Fee"). The Merger Fee shall be
equal to ten percent (10%) of the asset value or investment made in
the Company (including assumed debt) in such Business Opportunity as a
result of Advisor's introduction or efforts. One third (1/3) of the
Merger Fee shall be due and payable upon completion of the definitive
agreements related to each transaction, and the balance shall be
issued upon closing;
C. Transaction Fee: As to Services provided by Advisor related to the
sale of the Company's assets, the Company agrees to pay Advisor a fee
("Transaction Fee") equal to five percent (5%) of the net proceeds
received by the Company.
As additional incentive to execute this Agreement, the Company hereby
grants to Advisor an option to purchase Five Hundred Thousand (500,000)
shares of its common stock (the "Option"), exercisable at a price per share
of fifty cents ($.50) per share, which represents more than one hundred ten
percent (110%) of the fully diluted net book value of such shares as of the
Company's last quarterly financial statement. The Option shall be evidenced
by an Option Agreement in form and substance, with a stated exercise price,
as that attached hereto as Exhibit "B" and incorporated herein by
reference. The right of Advisor to exercise the Option will vest to Advisor
upon execution hereof.
5. Other Services
If the Company subsequent to the date hereof enters into a merger or
purchases the assets or enters into a joint venture with, or makes an
investment in a company (a "Business Opportunity") introduced by Advisor,
the Company agrees to pay Advisor a fee equal to five percent (5%) of the
value of each Business Opportunity introduced by Advisor (collectively
referred to herein, in each instance, as the "Transaction Fee"), which
shall be payable upon the closing date each such transaction in cash or in
shares of the Company's common stock on the same basis as the Fee Shares.
The Company and Advisor acknowledge that in the event Advisor, as a result
of this Agreement, receives shares of the Company's common stock it may be
considered an affiliate subject to Section 16(b) of the Securities Exchange
Act of 1934 (the "'34 Act"). In this regard the Company and Advisor agree,
that for purposes of any "profit" computation under Section 16(b) of the
'34 Act, the price paid for such shares is equal to the Advisory Fee or the
Transaction Fee, as the case may be.
[H:\NUOP\10SB\1999-8.wpd]
<PAGE>
6. Registration of Shares
No later than ten (10) days following the date hereof as to the Fee Shares,
the Advisory Fee (if paid in shares), the Option Shares and, as to an event
giving use to the obligation by the Company to pay a Transaction Fee, the
shares comprising the Transaction Fee shall be registered by the Company
with the Securities and Exchange Commission under a Form S-8 or other
applicable registration statement, and the Company shall cause such
registration statement to remain effective at all times while Advisor holds
such shares. At Advisor's election, such shares may be issued prior to
registration in reliance on exemptions from registration provided by
Section 4(2) of the Securities Act of 1933 (the "'33 Act"), Regulation D of
the '33 Act, and applicable state securities laws. Such issuance or
reservation of shares shall be in reliance on representations and
warranties of Advisor set forth herein. Failing to register such shares, or
maintain the effectiveness of the applicable registration statement, the
Company shall satisfy any Advisory Fee, Transaction Fee or Advisory Fee in
cash within ten (10) days of receipt of Advisor's statement setting out the
amount and type of fee then due and payable.
7. Costs and Expenses
All third party and out-of-pocket expenses incurred by Advisor in the
performance of the Services shall be paid by the Company, or Advisor shall
be reimbursed if paid by Advisor on behalf of the Company, within ten (10)
days of receipt of written notice by Advisor, provided that the Company
must approve in advance all such expenses in excess of $500 per month.
8. Place of Services
The Services provided by Advisor or Advisor's Personnel hereunder will
be performed at Advisor's offices except as otherwise mutually agreed
by Advisor and the Company.
9. Independent Contractor
Advisor and Advisor's Personnel will act as an independent contractor in
the performance of its duties under this Agreement. Accordingly, Advisor
will be responsible for payment of all federal, state, and local taxes on
compensation paid under this Agreement, including income and social
security taxes, unemployment insurance, and any other taxes due relative to
Advisor's Personnel, and any and all business license fees as may be
required. This Agreement neither expressly nor impliedly creates a
relationship of principal and agent, or employee and employer, between
Advisor's Personnel and the Company. Neither Advisor nor Advisor's
Personnel are authorized to enter into any agreements on behalf of the
Company. The Company expressly retains the right to approve, in its sole
discretion, each Business Opportunity introduced by Advisor, and to
make all final decisions with respect to effecting a transaction on
any Business Opportunity.
10. Rejected Business Opportunity
If, during the Primary Term of this Agreement or any Extension Period, the
Company elects not to proceed to acquire, participate or invest in any
Business Opportunity identified and/or selected by Advisor, notwithstanding
the time and expense the Company may have incurred reviewing such
transaction, such Business Opportunity shall re-vest back to and become
proprietary to Advisor, and Advisor shall be entitled to acquire or broker
the sale or investment in such rejected Business Opportunity for its own
account, or submit such assets or Business Opportunity elsewhere. In
such event, Advisor shall be entitled to any and all profits or fees
resulting from Advisor's purchase,
[H:\NUOP\10SB\1999-8.wpd]
<PAGE>
referral or placement of any such rejected Business Opportunity, or the
Company's subsequent purchase or financing with such Business Opportunity
in circumvention of Advisor.
11. No Agency Express or Implied
This Agreement neither expressly nor impliedly creates a relationship of
principal and agent between the Company and Advisor, or employee and
employer as between Advisor's Personnel and the Company.
12. Termination
The Company and Advisor may terminate this Agreement prior to the
expiration of the Primary Term upon thirty (30) days written notice with
mutual written consent. Failing to have mutual consent, without prejudice
to any other remedy to which the terminating party may be entitled, if any,
either party may terminate this Agreement with thirty (30) days written
notice under the following conditions:
(A) By the Company.
(i) If during the Primary Term of this Agreement or any Extension
Period, Advisor is unable to provide the Services as set forth
herein for thirty (30) consecutive business days because of
illness, accident, or other incapacity of Advisor's Personnel;
or,
(ii) If Advisor willfully breaches or neglects the duties required
to be performed hereunder; or,
(B) By Advisor.
(i) If the Company breaches this Agreement or fails to make any
payments or provide information required hereunder; or,
(ii) If the Company ceases business or, other than in the Initial
Merger, sells a controlling interest to a third party, or
agrees to a consolidation or merger of itself with or into
another corporation, or enters into such a transaction outside
of the scope of this Agreement, or sells substantially all of
its assets to another corporation, entity or individual
outside of the scope of this Agreement; or,
(iii) If the Company has a receiver appointed for its business or
assets, or otherwise becomes insolvent or unable to timely
satisfy its obligations in the ordinary course of business,
including but not limited to the obligation to pay the
Advisory Fee, the Transaction Fee, or the Advisory Fee; or,
(iv) If the Company institutes, makes a general assignment for the
benefit of creditors, has instituted against it any bankruptcy
proceeding for reorganization for rearrangement of its
financial affairs, files a petition in a court of bankruptcy,
or is adjudicated a bankrupt; or,
[H:\NUOP\10SB\1999-8.wpd]
<PAGE>
(v) If any of the disclosures made herein or subsequent hereto by
the Company to Advisor are determined to be materially false or
misleading.
In the event Advisor elects to terminate without cause or this Agreement is
terminated prior to the expiration of the Primary Term or any Extension
Period by mutual written agreement, or by the Company for the reasons set
forth in A(i) and (ii) above, the Company shall only be responsible to pay
Advisor for unreimbursed expenses, Advisory Fee and Transaction Fee accrued
up to and including the effective date of termination. If this Agreement is
terminated by the Company for any other reason, or by Advisor for reasons
set forth in B(i) through (v) above, Advisor shall be entitled to any
outstanding unpaid portion of reimbursable expenses, Transaction Fee, if
any, and the balance of the Advisory Fee for the remainder of the unexpired
portion of the applicable term (Primary Term or Extension Period) of the
Agreement.
13. Indemnification
Subject to the provisions herein, the Company and Advisor agree to
indemnify, defend and hold each other harmless from and against all
demands, claims, actions, losses, damages, liabilities, costs and expenses,
including without limitation, interest, penalties and attorneys' fees and
expenses asserted against or imposed or incurred by either party by reason
of or resulting from any action or a breach of any representation,
warranty, covenant, condition, or agreement of the other party to this
Agreement. In addition, the Company agrees to indemnify Advisor, its
officers, directors and general partner for expenses and the payment of
profits arising from the purchase and sale by Advisor of securities in
violation of Section 16(b) of the Securities Exchange Act of 1934, as
amended, or any similar successor statute.
14. Remedies
Advisor and the Company acknowledge that in the event of a breach of this
Agreement by either party, money damages would be inadequate and the
non-breaching party would have no adequate remedy at law. Accordingly, in
the event of any controversy concerning the rights or obligations under
this Agreement, such rights or obligations shall be enforceable in a court
of equity by a decree of specific performance. Such remedy, however, shall
be cumulative and non-exclusive and shall be in addition to any other
remedy to which the parties may be entitled.
15. Miscellaneous
(A) Subsequent Events. Advisor and the Company each agree to notify the
other party if, subsequent to the date of this Agreement, either
party incurs obligations which could compromise its efforts and
obligations under this Agreement.
(B) Amendment. This Agreement may be amended or modified at any time and
in any manner only by an instrument in writing executed by the
parties hereto.
(C) Further Actions and Assurances. At any time and from time to time,
each party agrees, at its or their expense, to take actions and to
execute and deliver documents as may be reasonably necessary to
effectuate the purposes of this Agreement.
(D) Waiver. Any failure of any party to this Agreement to comply with
any of its obligations, agreements, or conditions hereunder may be
waived in writing by the party to whom such compliance is owed.
[H:\NUOP\10SB\1999-8.wpd]
<PAGE>
The failure of any party to this Agreement to enforce at any time any
of the provisions of this Agreement shall in no way be construed to be
a waiver of any such provision or a waiver of the right of such party
thereafter to enforce each and every such provision. No waiver of any
breach of or non-compliance with this Agreement shall be held to be a
waiver of any other or subsequent breach or non-compliance.
(E) Assignment. Neither this Agreement nor any right created by it shall
be assignable by either party without the prior written consent of the
other.
(F) Notices. Any notice or other communication required or permitted by
this Agreement must be in writing and shall be deemed to be properly
given when delivered in person to an officer of the other party, when
deposited in the United States mails for transmittal by certified or
registered mail, postage prepaid, or when deposited with a public
telegraph company for transmittal, or when sent by facsimile
transmission charges prepared, provided that the communication is
addressed:
(i) In the case of the Company:
NuOasis Properties, Inc.
4695 MacArthur Court, Suite 530
Newport Beach, California 92660
Telephone: (949) 833-5381
Facsimile: (949) 833-7854
(ii) In the case of Advisor:
NuVen Advisors, Limited Partnership
4001 So. Decatur, Suite 37-130
Las Vegas, Nevada 89103
Telephone: (702) 871-9080
Telefax: (702) 871-5945
With copy to:
Richard O. Weed
Weed & Co. L.P.
4695 MacArthur Court, Suite #530
Newport Beach, CA 92660
Telephone: (949) 475-9086
Telefax: (949) 475-9087
or to such other person or address designated in writing by the
Company or Advisor to receive notice.
(G) Headings. The section and subsection headings in this Agreement are
inserted for convenience only and shall not affect in any way the
meaning or interpretation of this Agreement.
[H:\NUOP\10SB\1999-8.wpd]
<PAGE>
(H) Governing Law. This Agreement was negotiated and is being contracted
for in the state of Nevada and shall be governed by the laws of the
state of Nevada, notwithstanding any conflict-of-law provision to the
contrary.
(I) Binding Effect. This Agreement shall be binding upon the parties
hereto and inure to the benefit of the parties, their respective heirs,
administrators, executors, successors, and assigns.
(J) Entire Agreement. This Agreement contains the entire agreement between
the parties hereto and supersedes and renders null and void any and all
prior agreements, arrangements, or understandings between the parties
relating to the subject matter of this Agreement including but not
limited to the Advisory and Management Agreement dated October 1, 1997
and January 1, 1998. No oral understandings, statements, promises, or
inducements contrary to the terms of this Agreement exist. No
representations, warranties, covenants, or conditions, express or
implied, other than as set forth herein, have been made by any party.
(K) Severability. If any part of this Agreement is deemed to be
unenforceable the balance of the Agreement shall remain in full force
and effect.
(L) Counterparts. A facsimile, telecopy, or other reproduction of this
Agreement may be executed simultaneously in two or more counterparts,
each of which shall be deemed an original, but all of which together
shall constitute one and the same instrument, by one or more parties
hereto and such executed copy may be delivered by facsimile of similar
instantaneous electronic transmission device pursuant to which the
signature of or on behalf of such party can be seen. In this event,
such execution and delivery shall be considered valid, binding and
effective for all purposes. At the request of any party hereto, all
parties agree to execute an original of this Agreement as well as any
facsimile, telecopy or other reproduction hereof.
(M) Time is of the Essence. Time is of the essence of this Agreement and
of each and every provision hereof.
IN WITNESS WHEREOF, the parties have executed this Agreement on
the date above written.
"Advisor"
NuVen Advisors, Limited Partnership
a Nevada Limited Partnership
By: /s/ Fred G. Luke
Name: Fred G. Luke
Title: General Partner
The "Company"
NuOasis Properties, Inc.
a Nevada corporation
By: /s/ Jon L. Lawver
Name: Jon L. Lawver
Title: Director
[H:\NUOP\10SB\1999-8.wpd]
<PAGE>
EXHIBIT "A"
to the
Advisory Agreement
dated July 1, 1999
THE OPTION
[H:\NUOP\10SB\1999-8.wpd]
<PAGE>
OPTION AGREEMENT
THIS OPTION AGREEMENT ("Agreement") is entered into effective the 1st day
of July 1999, by and between Fred G. Luke, individually and on behalf of NuVen
Advisor Limited Partnership, a Nevada Limited Partnership (collectively
"NuVen"), and NuOasis Properties, Inc., a Nevada corporation (the "Company").
WHEREAS, the Company has agreed to issue to NuVen the option to purchase
shares of the Company's common stock (the "Common Stock") to induce NuVen to
execute the Advisory Agreement of even date between the Company and NuVen, such
agreement incorporated herein by reference (the "Advisory Agreement").
NOW, THEREFORE, for and in consideration of the mutual promises herein, and
for other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, and subject to the terms and conditions set forth
below, NuVen and the Company agree as follows:
1. The Option
The Company hereby grants to NuVen the option to acquire Five Hundred
Thousand (500,000) shares of the Company's Common Stock (the "Option"),
subject to adjustment as set forth herein (such shares, as adjusted, are
hereinafter referred to as the "Option Shares"), at a purchase price of
Fifty Cents ($.50) per share ("Option Price").
2. Term and Exercise of Option
A. Term of Option. Subject to the terms of this Agreement, Holder shall
have the right to exercise the Option in whole or in part, commencing
the date hereof through the close of business on July 1, 2004.
B. Exercise of the Option. The Option may be exercised upon written
notice to the Company at its principal office setting out the number of
Option Shares to be purchased, together with payment of the Option
Price.
C. Issuance of Option Shares. Upon such notice of exercise and payment of
the Option Price, the Company shall issue and cause to be delivered
within five (5) business days following the written order of Holder,
or its successor as provided for herein, and in such name or names as
the Holder may designate, a certificate or certificates for the number
of Option Shares so purchased. The rights of purchase represented by
the Option shall be exercisable, at the election of the Holder thereof,
either in full or from time to time in part, and in the event the
Option is exercised in respect of less than all of the Option Shares
purchasable on such exercise at any time prior to the date of
expiration hereof, the remaining Option Shares shall continue to be
subject to adjustment as set forth in paragraph 4 hereof. The Company
irrevocably agrees to reconstitute the Option Shares as provided
herein.
[H:\NUOP\10SB\1999-8.wpd]
<PAGE>
3. Reservation of Option Shares
The Company shall at all times keep reserved and available, out of its
authorized Common Stock, such number of shares of Common Stock sufficient to
provide for the exercise of the Option represented by this Agreement. The
transfer agent for the Company's Common Stock and any successor transfer
agent for any shares of the Company's capital stock issuable upon the
exercise of any of such Option rights, will be irrevocably authorized and
directed at all times by the Company in writing to reserve such number of
shares. The Company will cause a copy of this Agreement to be kept on file
with the Company's current transfer agent or its successors.
4. Adjustment of Option Shares
The number of Option Shares purchasable pursuant to this Agreement shall be
subject to adjustment from time to time upon the occurrence of certain
events, as follows:
A. Adjustment for Recapitalization. In the event the Company shall
(a) subdivide its outstanding shares of Common Stock, or (b) issue
or convert by a reclassification or recapitalization of its shares of
Common Stock into, for, or with other securities (a "Recapitalization"),
the number of Option Shares purchasable hereunder immediately following
such Recapitalization shall be adjusted so that the Holder shall be
entitled to receive the kind and number of Option Shares or other
securities of the Company measured as a percentage of the total issued
and outstanding shares of the Company's Common Stock as of the date
hereof, which it would have been entitled to receive immediately
preceding such Recapitalization, had such Option been exercised
immediately prior to the happening of such event or any record date with
respect thereto; provided however that, in the event of any change in
the Company's Common Stock by reason of a reverse stock split, neither
the number nor the Option Price of the shares subject to this Option
shall be changed or be adjusted.
B. Preservation of Purchase Rights Under Consolidation. Subject to
paragraph 4 above, in case of any Recapitalization or any other
consolidation of the Company with or merger of the Company into another
corporation, or in case of any sale or conveyance to another corporation
of the property of the Company as an entirety or substantially as an
entirety, the Company shall prior to the closing of such transaction,
cause such successor or purchasing corporation, as the case may be, to
acknowledge and accept responsibility for the Company's obligations
hereunder and to grant the Holder the right thereafter upon payment of
the Option Price to purchase the kind and amount of shares and other
securities and property which he would have owned or have been entitled
to receive after the happening of such consolidation, merger, sale or
conveyance. The provisions of this paragraph shall similarly apply to
successive consolidations, mergers, sales or conveyances.
C. Notice of Adjustment. Whenever the number of Option Shares purchasable
hereunder is adjusted, as herein provided, the Company shall mail by
first class mail, postage prepaid, to the Holder notice of such
adjustment or adjustments, and shall deliver to Holder setting forth the
adjusted number of Option Shares purchasable and a brief statement of
the facts requiring such adjustment, including the computation by which
such adjustment was made.
[H:\NUOP\10SB\1999-8.wpd]
<PAGE>
5. Failure to Deliver Option Shares Constitutes Breach Under Advisory Agreement
Failure by the Company, for any reason, to deliver the certificates
representing any shares purchased pursuant to this Option within the
five (5) business day period set forth in paragraph 2 above, or the
placement of a Stop Transfer order by the Company on any Option Shares once
issued, shall constitute a "Breach" under the Advisory Agreement and, for
the purpose of determining the terms of this Agreement, shall automatically
toll the expiration of this Agreement for a period of time equal to the
delay in delivering the subject shares or term of the Stop Transfer order.
6. Indemnification for Section 16 (b) Violation
The Company agrees to indemnify NuVen for expenses and the payment of
profits arising from the exercise of the Option and sale by NuVen of Option
Shares in violation of Section 16(b) of the Securities Exchange Act of 1934,
as amended, or any similar successor statute.
7. Assignment
The Option represented by this Agreement may only be assigned or transferred
by NuVen to an Affiliate or subsidiary, or as the result of a corporate
reorganization or recapitalization. For the purpose of this Option the term
"Affiliate" shall be defined as a person or enterprise that directly, or
indirectly through one or more intermediaries, controls, or is controlled
by, or is under common control with the Company otherwise, this Agreement
and the rights hereunder shall not be assigned by either party hereto.
8. Counterparts
A facsimile, telecopy or other reproduction of this instrument may be
executed by one or more parties hereto and such executed copy may be
delivered by facsimile or similar instantaneous electronic transmission
device pursuant to which the signature of or on behalf of such party can be
seen, and such execution and delivery shall be considered valid, binding and
effective for all purposes. At the request of any party hereto, all parties
agree to execute an original of this instrument as well as any facsimile,
telecopy or other reproduction hereof.
9. Further Documentation
Each party hereto agrees to execute such additional instruments and take
such action as may be reasonably requested by the other party to affect the
transaction, or otherwise to carry out the intent and purposes of this
Agreement.
10. Notices
All notices and other communications hereunder shall be in writing and shall
be sent by prepaid first class mail to the parties at the following
addresses, as amended by the parties with written notice to the other:
[H:\NUOP\10SB\1999-8.wpd]
<PAGE>
To NuVen: Fred G. Luke
NuVen Advisor Limited Partnership
4695 MacArthur Court, Suite #530
Newport Beach, CA 92660
Telephone: (949) 833-2094
Telefax: (949) 833-7854
With copy to: Weed & Co. LP
4695 MacArthur Court, Suite 530
Newport Beach, California 92660
Telephone: (949) 475-9086
Facsimile: (949) 475-9087
To the Company: NuOasis Properties, Inc.
4695 MacArthur Court, Suite 530
Newport Beach, California 92660
Telephone: (949) 833-5358
Facsimile: (949) 833-7854
11. Counterparts
This Agreement may be executed simultaneously in two or more counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
12. Governing Law
This Agreement was negotiated, and shall be governed by the laws of Nevada
notwithstanding any conflict-of-law provision to the contrary.
13. Entire Agreement
This Agreement sets forth the entire understanding between the parties
hereto and no other prior written or oral statement or agreement shall be
recognized or enforced.
14. Severability
If a court of competent jurisdiction determines that any clause or provision
of this Agreement is invalid, illegal or unenforceable, the other clauses
and provisions of the Agreement shall remain in full force and effect and
the clauses and provision which are determined to be void, illegal or
unenforceable shall be limited so that they shall remain in effect to the
extent permissible by law.
15. Amendment or Waiver
Every right and remedy provided herein shall be cumulative with every other
right and remedy, whether conferred herein, at law, or in equity, and may
be enforced concurrently herewith, and no waiver by any party of the
performance of any obligation by the other shall be construed as a waiver
of the same or any other default then, theretofore, or thereafter occurring
or existing. At any time prior to Closing, this Agreement may be amended by
a writing signed by all parties hereto.
[H:\NUOP\10SB\1999-8.wpd]
<PAGE>
16. Headings
The section and subsection headings in this Agreement are inserted for
convenience only and shall not affect in any way the meaning or
interpretation of this Agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement the day
and year first written above.
"NuVen"
Fred G. Luke, dba
NuVen Advisor Limited Partnership
By: /s/ Fred G. Luke
Name: Fred G. Luke
Title: General Partner
The "Company"
NuOasis Properties, Inc.
a Nevada corporation
By: /s/ Jon L. Lawver
Name: Jon L. Lawver
Title: Director
[H:\NUOP\10SB\1999-8.wpd]
EXHIBIT 23.1
CONSENT OF INDEPENDENT AUDITORS
We agree to the inclusion in this Form 10-SB of our report, dated November 18,
1999, on our audit of the financial statements of NuOasis Properties, Inc. as of
June 30, 1999 and for each of the years in the two-year period then ended.
/s/ HASKELL & WHITE LLP
Haskell & White LLP
Irvine, California
March 6, 2000
[H:\NUOP\10SB\1999-8.wpd]
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
EXHIBIT 27
FINANCIAL DATA SCHEDULE
<ARTICLE> 5
<MULTIPLIER> 1
<S> <C> <C>
<PERIOD-TYPE> 6-MOS 12-MOS
<FISCAL-YEAR-END> JUN-30-1999 JUN-30-1999
<PERIOD-START> JUL-1-1999 JUL-1-1998
<PERIOD-END> DEC-31-1999 JUN-30-1999
<CASH> 37 37
<SECURITIES> 26,220 26,220
<RECEIVABLES> 0 0
<ALLOWANCES> 0 0
<INVENTORY> 0 0
<CURRENT-ASSETS> 26,257 26,257
<PP&E> 0 0
<DEPRECIATION> 0 0
<TOTAL-ASSETS> 26,257 26,257
<CURRENT-LIABILITIES> 91,886 91,886
<BONDS> 0 0
0 0
300 300
<COMMON> 813 813
<OTHER-SE> (66,742) (45,742)
<TOTAL-LIABILITY-AND-EQUITY> 26,257 26,257
<SALES> 0 0
<TOTAL-REVENUES> 0 0
<CGS> 0 0
<TOTAL-COSTS> 21,000 67,917
<OTHER-EXPENSES> 0 0
<LOSS-PROVISION> 0 0
<INTEREST-EXPENSE> 0 0
<INCOME-PRETAX> (21,000) (67,917)
<INCOME-TAX> 0 0
<INCOME-CONTINUING> (21,000) (67,917)
<DISCONTINUED> 0 0
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> (21,000) (67,917)
<EPS-BASIC> (0.03) (0.08)
<EPS-DILUTED> (.03) (0.08)
</TABLE>
EXHIBIT 99.1
Nevada Revised Statutes
77.7502. Discretionary and mandatory indemnification of officers, directors,
employees and agents: General provisions.
1. A corporation may indemnify any person who was or is a party or is
threatened to be made a party to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative,
except an action by or in the right of the corporation, by reason of the fact
that he is or was a director, officer, employee or agent of the corporation, or
is or was serving at the request of the corporation as a director, officer or
employee or agent of another corporation, partnership, joint venture, trust or
other enterprise, against expenses, including attorneys' fees, judgment, fines
and amounts paid in settlement actually and reasonably incurred by him in
connection with the action, suit or proceeding if he acted in good faith and in
a manner which he reasonably believed to be in and not opposed to the best
interests of the corporation, and, with respect to any criminal action or
proceeding had no reasonable cause to believe his conduct was unlawful. The
termination of any action, suit or proceeding by judgment, order, settlement,
conviction or upon a plea of nolo contendere or its equivalent, does not, of
itself, create a presumption that the person did not act in good faith and in a
manner which he reasonably believed to be in and not opposed to the best
interests of the corporation, and that, with respect to any criminal action or
proceeding, he had reasonable cause to believe that his conduct was unlawful.
2. A corporation may indemnify any person who was or is a party or is
threatened to be made a party to any threatened, pending or completed action or
suit by or in the right of the corporation to procure a judgment in its favor by
reason of the fact that he is or was a director, officer, employee or agent of
the corporation, or is or was serving at the request of the corporation as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise against expenses, including amounts paid in
settlement and attorneys' fees actually and reasonably incurred by him in
connection with the defense or settlement of the action or suit if he acted in
good faith and in a manner which he reasonably believed to be in or not opposed
to the best interests of the corporation. Indemnification may not be made for
any claim, issue or matters to which such a person has been adjudged by a court
of competent jurisdiction, after exhaustion of all appeals therefrom, to be
liable to the corporation or for amounts paid in settlement to the corporation,
unless and only to the extent that the court in which the action or suit was
brought or other court of competent jurisdiction determines upon application
that in view of all the circumstances of the case, the person is fairly and
reasonably entitled to indemnify for such expenses as the court deems proper.
3. To the extent that a director, officer, employee or agent of a
corporation has been successful on the merits or otherwise in defense of any
action, suit or proceeding referred to in subsections 1 and 2, or in defense of
any claim, issue or matter therein, the corporation shall indemnify him against
expenses, including attorneys' fees, actually and reasonably incurred by him in
connection with the defense.
[H:\NUOP\10SB\1999-8.wpd]
