U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report: July 24, 1998
SOUTHERN STATES POWER COMPANY, INC.
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(Formerly Known As Pascal Ventures, Inc.)
(Exact name of registrant as specified in its charter)
Delaware
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(State or other jurisdiction of incorporation)
0-29356 33-0312389
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(Commission File No.) (IRS Employer
Identification No.)
830 Havens Road
Shreveport, Louisiana 71107
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(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code: (318) 868-1495
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Item 1. Change in Control of Registrant.
Effective July 13, 1998, pursuant to a definitive agreement
(attached hereto and incorporated herein as Exhibit 2.0) (the
"Agreement") Pascal Ventures, Inc., a Delaware corporation (the
"Company") acquired all of the issued and outstanding shares of
Southern States Power Company, a Louisiana corporation
("Southern"). The terms of the transaction involved the Company
issuing an aggregate of 8,205,000 shares of its "restricted" common
stock to the former shareholders of Southern in exchange for all of
the issued and outstanding stock of Southern. Southern did not
survive the transaction. The Company has also changed its name to
"Southern States Power Company, Inc."
Pursuant to the terms of the Agreement, Bruce Crawford,
Kristin Walker and Gerard Jackson resigned their respective
positions in the Company and the following persons were appointed
as new officers and directors of the Company:
Name Office
__________________ ______________________
Heber C. Bishop President/Director
William Curtis Thurmon Director
Robert B. Raines, Jr. Director
Antoinette Fowler Secretary/Treasurer
The percentage of voting securities of the Company now
beneficially owned directly or indirectly by the entity who
acquired control and the identity of the entities who acquired
control are as follows:
Name of Amount and Nature of Percent of
Beneficial Owner Beneficial Ownership Class
- --------------------------------------------------------------
B.A.T. International 5,000,000 48.9%
3601 Empire Avenue
Burbank, CA 91505
Roberto & Terese Beaton 5,000 *
4314 Victory Blvd.
Burbank, CA 91505
Heber C. Bishop(1) 50,000 *
6283 Tall Oaks Lane
Salt Lake City, Utah 84121
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Name of Amount and Nature of Percent of
Beneficial Owner Beneficial Ownership Class
- --------------------------------------------------------------
James R. Bunnel 25,000 *
6817 Lake Cove Lane
Citrus Heights, CA 95621
Terri L. Bush 10,000 *
4097 Fern Ave.
Shreveport, LA 71105
Nilesh & Sonal Desai 60,000 *
132 Aspen Oak Lane
Glendale, CA 91207
Jayesh & Meena Desai 10,000 *
201 S. Brighton St.
Burbank, CA 91505
Robert Deutsch 35,000 *
2312 Magnolia Blvd.
Burbank, CA 91506
Bryan Eget 13,000 *
18322 Blyth Street
Reseda, CA 91335
Antoinette Fowler(1) 5,000 *
4440 Old Mooringsport Rd.
Shreveport, LA 71107
Franklin Case 2,000 *
241 Olive
Burbank, CA 91502
Hemisphere Group, Inc. 1,000,000 9.7%
6 Venture, Ste. 207
Irvine, CA 92618
Paul & Bobbi Kouri 20,000 *
1 Regency Dr.
Rancho Mirage, CA 92270
Mahendra & Ann Patel 20,000 *
19633 Pine Valley Way
Northridge, CA 92270
Shailesh & Sudha Patel 15,000 *
923 Calle Amable
Glendale, CA 91326
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Name of Amount and Nature of Percent of
Beneficial Owner Beneficial Ownership Class
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Robert B. Raines, Jr.(1) 20,000 *
3707 Truett
Shreveport, LA 71007
Roberto Ruiz 10,000 *
27523 Diane Marie Cir.
Saugus, CA 91501
Southern States Gas 1,150,000 11.2%
Gathering System, LLC
5295 S. Commerce Dr.330
Salt Lake City, UT 84107
Southern States Oil 700,000 6.8%
Production, LLC
830 Havens Road
Shreveport, LA 71101
William Curtis Thurmon(1) 30,000 *
5701 Lakefront
Shreveport, LA 71119
Unlimited Group, Inc. 25,000 *
5295 Commerce Dr., Ste. 310
Salt Lake City, UT 84107
All Proposed Directors 105,000 1.0%
and Officers as a
Group (4 persons)
_________________________
(1) Officer and Director.
* Less than 1%
Item 2. Acquisition and Disposition of Assets.
Effective July 13, 1998, 1998, Pascal Ventures, Inc., a
Delaware corporation (the "Company") acquired all of the issued and
outstanding securities of Southern States Power Company, Inc., a
Louisiana corporation ("Southern"), consisting of 8,205,000 shares
of common stock, par value $.001 per share. The nature and amount
of consideration given in connection with the Agreement was the
issuance of 8,205,000 shares of "restricted" common stock of the
Company to the former Southern shareholders. The consideration
given and received was determined by arms-length negotiations
between the principals of the Company and the principals of
Southern. No material relationship existed or presently exists
between management of the companies. In addition the Company
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undertook a "forward split" of its common stock, whereby 4 shares
of common stock will be issued in exchange for one share of common
stock prior to the closing. Therefore, immediately prior to
closing, there were 2,000,000 shares of the Company outstanding.
Subsequent to the closing there are 10,205,000 shares of the
Company's commons stock outstanding.
The Company intends to develop its proprietary technology
relating to the generation of power for small and large power
generation facilities and to attempt to obtain favorable market
prices for natural gas and other needed fuels for power systems
with which it intends to contract. To date the Company has
generated no revenues.
Item 6. Resignation of Registrant's Directors.
Bruce Crawford, Kristin Walker, and Gerard Jackson
resigned as officers and directors of the Company, effective July
13, 1998, all of whom constituted the complete Board of Directors
of the Company as of that date.
Item 7. Financial Statements, Pro Forma Financial Information and
Exhibits.
Item 7(a). Financial Statements of Business Acquired
- -----------------------------------------------------
The audited financial statements of Southern States Power
Company, Inc. for the fiscal years ended March 31, 1998 are
attached hereto.
Item 7(b). Pro Forma Financial Information.
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The Registrant hereby undertakes to file an amendment to this
Form 8-K within sixty (60) days from the date of this filing, to
include the pro forma financial information of the Company pursuant
to Article 11 of Regulation S-X.
Item 7(c) Exhibits.
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Number Exhibit
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2.0 Share Exchange Agreement and Plan of
Reorganization
27.0 Financial Data Schedule
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934 the registrant has duly caused this report to be signed on its
behalf by the undersigned hereunto duly authorized.
SOUTHERN STATES POWER COMPANY, INC.
By:/s/ Heber Bishop
--------------------------------
Heber Bishop,
President
Dated: July 24, 1998
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SOUTHERN STATES POWER COMPANY, INC.
BALANCE SHEET
MARCH 31, 1998
CONTENTS
Page
Independent Auditors' Report 1
Balance Sheet 2
Notes to Balance Sheet 3-4
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STONEFIELD JOSEPHSON, INC.
Certified Public Accountants
Business & Personal Advisors
Members DFK, IAPA, Institute for Profit Advisors
INDEPENDENT AUDITOR'S REPORT
Board of Directors
Southern States Power Company, Inc.
Shreveport, Louisiana
We have audited the accompanying balance sheet of Southern States
Power Company, Inc. as of March 31, 1998. This balance sheet is
the responsibility of the Company's management. Our responsibility
is to express an opinion on this balance sheet based on our audit.
We conducted our audit in accordance with generally accepted
auditing standards. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
balance sheet is free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and
disclosures in the balance sheet. An audit also includes assessing
the accounting principles used and significant estimates made by
management, as well as evaluating the overall balance sheet
presentation. We believe that our audit provides a reasonable
basis for our opinion.
In our opinion, the balance sheet referred to above presents
fairly, in all material respects, the financial position of
Southern States Power Company, Inc. as of March 31, 1998, in
conformity with generally accepted accounting principles.
s/Stonefield Josephson, Inc.
CERTIFIED PUBLIC ACCOUNTANTS
Santa Monica, California
May 12, 1998
1620 26th Street, Suite 400 South
Santa Monica, CA 90404-4041
310 453-9400 Fax 310 453-1187
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SOUTHERN STATES POWER COMPANY, INC.
BALANCE SHEET - MARCH 31, 1998
ASSETS
Cash $1,000,000
Organization costs 10,000
$1,010,000
STOCKHOLDERS' EQUITY
Common stock; $0.001 par value,
10,000,000 shares authorized,
3,005,000 shares issued and
outstanding $ 3,005
Additional paid-in capital 1,006,995
$1,010,000
See accompanying independent auditors' report and notes
to balance sheet
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SOUTHERN STATES POWER COMPANY, INC.
NOTES TO BALANCE SHEET
MARCH 31, 1998
(1) Summary of Significant Accounting Policies:
General:
The Company was incorporated in the State of Louisiana on
March 13, 1998 and has elected December as its year-end
Business Activity:
The Company has had no operating activity and plans to
generate energy efficient power supply in exchange for
fees from customers.
Organization Costs:
The Company's organization costs consists of legal and
filing fees, which were incurred by Southern States Power
Company, Inc., and will be amortized over a 60-month
period.
Use of 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.
Fair Value:
Unless otherwise indicated, the fair values of all
reported assets and liabilities which represent financial
instruments, none of which are held for trading purposes,
approximate carrying values of such amounts.
Cash:
The Company maintains its cash in bank deposit accounts,
which, at times, may exceed federally insured limits.
The Company has not experienced any losses in such
accounts.
See accompanying independent auditors' report
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SOUTHERN STATES POWER COMPANY, INC.
NOTES TO BALANCE SHEET (CONTINUED)
MARCH 31, 1998
(2) Stockholders' Equity:
The Company issued 2,500,000 shares of its common stock to
B.A.T. International, Inc. in exchange for an exclusive
worldwide license to utilize the B.A.T. Dolphin Pulse Charge
Technology for use in its power generation and natural gas
pumping applications.
The Company raised $1,000,000 through the issuance of 500,000
shares of its common stock to The Hemisphere Group. An option
to purchase and additional 750,000 shares of the Company's
common stock remains outstanding until March 2000 and may be
exercised at a price of $2.00 per share.
The Company also issued 5,000 shares of its common stock in
exchange for legal services related to organization costs.
(3) Subsequent Events:
The Company entered into a five-year agreement with Southern
States Gas Gathering System, LLC to purchase up to 2,000,000
cubic feet of natural gas per day at $2,600 per million cubic
feet in exchange for 350,000 shares of its common stock. The
Company may extend this agreement for another five years, at
the end of the initial term, at a price of 5% below the spot
price of natural gas.
The Company also entered into a five year agreement with
Southern States Oil Production, LLC to purchase up to 4,200
gallons of Louisiana light sweet crude oil per day at a fixed
price of $0.38 per gallon in exchange for 350,000 shares of
its common stock. The Company may extend this agreement for
another five years, at the end of this initial term, at a
price of 5% below the spot price of Louisiana light sweet
crude oil.
The Company has entered into negotiations whereby it would
merge into a publicly held corporation which has negligible
operations (the "Shell"). Since the shareholders of the
Company will become controlling shareholders of the Shell,
the Company will be treated as the acquirer for accounting
purposes, and will then become a publicly reporting company.
See accompanying independent auditors' report.
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SOUTHERN STATES POWER COMPANY, INC.
________________________________
EXHIBIT 2.0 TO FORM 8-K
________________________________
SHARE EXCHANGE AGREEMENT
AND PLAN OF REORGANIZATION
________________________________
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SHARE EXCHANGE AGREEMENT AND PLAN OF REORGANIZATION
THIS AGREEMENT, made and entered into this 29th day of May,
1998, by and between Pascal Ventures, Inc. ("Public Company"), a
publicly held Delaware corporation, and Southern States Power
Company, Inc. "Company"), a privately held Louisiana corporation
("Company") and the individuals listed on Exhibit "A" attached
hereto and specifically incorporated herein by this reference (the
"Company Shareholders").
WITNESSETH:
WHEREAS, Public Company desires to acquire all of the issued
and outstanding capital stock of Company; and
WHEREAS, the Company Shareholders are the sole holders of all
Company's capital stock outstanding and they desire to transfer the
same to Public Company in exchange for such consideration as is set
forth herein; and
WHEREAS, it is the intention of the parties to this Agreement
that the transactions evidenced hereby qualify as a reorganization
pursuant to such sections of the Internal Revenue Code of 1954, as
amended (the "Code"), as are applicable, including, without
limitation, Section 368(a)(1)(b) thereof, and that there not be a
taxable gain or loss recognized by Public Company, Company or the
Company Shareholders upon consummation of the transactions
evidenced hereby; and
WHEREAS, the transactions evidenced hereby are to be submitted
for approval at a special meeting of the Board of Directors of
Public Company and Company and by the Company Shareholders by
unanimous consent, dated on even date herewith;
NOW, THEREFORE, in consideration of the foregoing premises and
the mutual covenants, terms and conditions set forth herein, and
such other and further consideration, the receipt and sufficiency
of which is hereby acknowledged, this Agreement is adopted as a
reorganization pursuant to the Code and THE PARTIES AGREE AS
FOLLOWS:
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ARTICLE I
REPRESENTATIONS AND WARRANTIES OF PUBLIC COMPANY
Public Company represents and warrants to Company and the
Company Shareholders as follows:
1.1 Company Profile; Assets and Liabilities. Public Company
is not currently conducting, and has never been engaged in, any
business other than as set forth its definitive Form 10-SB/A3 dated
on or about February 1998 (the "Form"). Other than the costs
associated with the transaction proposed herein, Public Company has
no liabilities of any nature, whether accrued, absolute,
contingent, known or otherwise. Public Company has no assets
except as disclosed on its audited financial statements for the
year ended April 30, 1997.
1.2 Financial Statements. Public Company has delivered
audited financial statements dated, and for the period ended April
30, 1997, together with all notes thereto, prepared in reasonable
detail in accordance with generally accepted accounting principles
applied on a consistent basis, which financial statements contain
a balance sheet dated April 30, 1997 and the following statements
for the period then ended: a statement of operations, a statement
of stockholders' equity, and a statement of cash flows.
1.3 Absence of Certain Changes. Since the date of the most
recent financial statements delivered hereunder, Public Company has
not:
(a) Suffered any material and adverse change in its financial
condition, working capital, assets, liabilities, reserves,
business, operations or prospects;
(b) Suffered any loss, damage, destruction or other casualty
materially and adversely affecting any of its properties, assets or
business (whether or not covered by insurance);
(c) Borrowed or agreed to borrow any funds or incurred, or
assumed or become subject to, whether directly or by way of
guarantee or otherwise, any obligation or liability, except as
related to the costs associated with the proposed transaction
herein and to its transfer agent;
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(d) Paid, discharged or satisfied any claims, liabilities or
obligations, other than in the normal course of its business;
(e) Permitted or allowed any of its property or assets (real,
personal or mixed, tangible or intangible) to be subjected to any
mortgage, pledge, lien, security interest, encumbrance, restriction
or charge of any kind;
(f) Canceled any debts or waived any claims or rights of
substantial value, or sold, transferred, or otherwise disposed of
any of its properties or assets (real, personal or mixed, tangible
or intangible);
(g) Granted any increase in the compensation of directors,
officers or employees (including any such increase pursuant to any
bonus, pension, profit-sharing or other plan or commitment), or any
increase in the compensation payable or to become payable to any
director, officer or employee;
(h) Made any capital expenditure or commitment outside of its
normal course of business;
(i) Declared, paid or set aside for payment any dividend or
other distribution in respect of its capital stock or, directly or
indirectly, redeemed, purchased or otherwise acquired any shares of
its capital stock or other securities, other than as required
hereunder;
(j) Made any change in any method of accounting or accounting
practice;
(k) Paid, loaned or advanced any amount to, or sold,
transferred or leased any properties or assets (real, personal or
mixed, tangible or intangible), to, or entered into any affiliate
or associate of any of its directors or officers, except for
directors' fees and compensation to officers at rates set forth in
any Form 10-K or 10-KSB of Public Company filed with the Securities
and Exchange Commission, none of which shall result in any
liability or indebtedness which shall survive this closing;
(l) Entered into any transaction, contract or commitment;
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(m) Been subject to any other event or condition of any
character that has or might reasonably have a material and adverse
effect upon the financial condition, business, assets or properties
of Public Company;
(n) Agreed, whether in writing or otherwise, to take any
action described in this paragraph of the Agreement.
1.4 Affirmative Representations Regarding Action of Public
Company between Date of Financial Statements Delivered and Closing.
Between the date of the most recent financial statements delivered
hereunder and the date of this Agreement, Public Company has
conducted its business in the same manner as conducted before the
date of such financials. Public Company will continue to conduct
its business in the same manner as conducted before the date of the
financial statements through the date of closing, as defined
hereinbelow.
1.5 Employment Agreements; Benefit Plans. There is not
currently any employment or severance agreement to which Public
Company was or is subject, or by which it was or is bound.
Further, no such agreements will arise in the future as a result of
acts which have occurred previous to, or concurrent with, the date
hereof. Further, Public Company is not subject to, nor has it
established, a benefit plan, whether pursuant to the Code or
otherwise, other than disclosed in Public Company's Form. No
shares of common stock, options to acquire common stock or other
benefits have been issued under, or pursuant to, any such plan or
arrangement.
1.6 Permits and Licenses. The business of Public Company has
complied and currently complies in all material respects with all
applicable laws and regulations and with its Form. Further, the
business of Public Company does not currently require, and has not
in the past required, application to procure any license, permit,
franchise, order or approval.
1.7 Litigation. There is no litigation or proceeding pending
or threatened against or relating to Public Company or its
business. There is no factual basis, whether known or unknown, for
any claim or action to be threatened or asserted against Public
Company.
1.8 Contracts, Agreements and Leases. Other than its
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agreement with its legal counsel and transfer agent, Public Company
is not a party to any contracts, agreements, permits, licenses,
plans, leases or similar arrangements. The obligations of Public
Company owed to its legal counsel and transfer agent will be paid
in full through closing by Public Company, without exception.
1.9 Principal Shareholders. Public Company has previously
provided to Company or its counsel a current list of its
shareholders and as of the date of this Agreement and affirmatively
states that no additional shares have been issued by the Board of
Directors of Public Company, nor is issuance of such additional
shares contemplated as of the date of this Agreement, other than as
described herein. The shareholder list delivered to Company is
accurate and complete as of the Closing Date herein.
1.10 Authorization. Public Company has duly taken all
corporate action necessary to authorize the execution and delivery
of this Agreement, the consummation of the transactions evidenced
hereby and the performance of its obligations hereunder.
1.11 Enforceable Obligations. This Agreement is a legal and
binding obligation of Public Company, enforceable in accordance
with the terms hereof, except as limited by bankruptcy, insolvency
or other laws of general application relating to the enforcement of
creditors' rights and general equitable principles.
1.12 No Conflicts or Consents. The execution and delivery
by Public Company of this Agreement and the performance of its
obligations have not conflicted and will not conflict with any
provision of law, statute, rule or regulation or any judgment
applicable to or binding upon Public Company, nor will it result
in the creation of any lien, charge or encumbrance. No consent,
approval, authorization or order of any court or governmental
authority or third party has been or is required in connection
with the execution and delivery by Public Company of this
Agreement or the consummation of the transactions evidenced
hereby. Neither the execution nor the consummation of this
Agreement in accordance with the terms and conditions set forth
herein has conflicted or will conflict with or constitute a
default under or a breach or violation or grounds for termination
of or an event which with the lapse of time or notice and the
lapse of time could or would constitute a default under the
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Certificate or Articles of Incorporation or Bylaws of Public
Company.
1.13 Organization and Good Standing. Public Company is a
corporation duly organized, validly existing and in good standing
under the laws of the State of Delaware and has all corporate
powers required to carry on its business and enter into and carry
out the transactions evidenced herein. Public Company is qualified
to do business and is in good standing as a foreign corporation in
all jurisdictions wherein the character of the properties owned or
held by it or the nature of the business transacted makes such
qualification necessary. As of the date hereof, Public Company
does not have any subsidiaries or interests in any corporation,
partnership, limited partnership or other business entity.
1.14 Capitalization. Prior to execution of this Agreement,
the shareholders of Public Company have adopted certain
resolutions, including ratifying a forward split of the Public
Company common stock and caused the applicable Article relevant to
the Public Company capitalization included in the Articles of
Incorporation of Public Company, to be amended. As a result of the
adoption of these resolutions and amendments, the authorized
capital stock of Public Company now consists of 15,000,000 shares
of common stock, $.001 par value, of which 500,000 of such shares
are issued and outstanding, all fully paid for and nonassessable,
and no shares of preferred stock. All references to the
capitalization of Public Company in this Agreement reflect the
changes so authorized by the Public Company shareholders.
Public Company has no other outstanding rights, options, warrants,
contracts, commitments or demands of any character which would
require the issuance (or transfer out of treasury), by Public
Company of any shares of its capital stock. All outstanding
securities were issued in accordance with applicable federal and
state securities laws or exemptions therefrom. The Public Company
Form was duly registered with the U.S. Securities and Exchange
Commission ("SEC") and all applicable state securities departments
(collectively referred to as "State Registrations"). All SEC and
State Registrations complied with all applicable laws, rules and
regulations. No claims or actions have been threatened or asserted
arising out of, or concerning, the Form, SEC Registrations, State
Registrations or the sale of securities of Public Company.
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1.15 Filing of Reports. Public Company is presently current
in the requirement to file all Form 10-QSB, 10-KSB and 8-KSB
reports required to be filed pursuant to the Securities Exchange
Act of 1934, as amended. Further, Public Company has filed all
required reports of application of proceeds with all applicable
state securities departments on the appropriate forms and will,
prior to or at Closing, file the final Form SR with the SEC. All
forms, filings and reports, including but not limited to the Form,
filed by Public Company with the SEC and each state securities
department were complete and accurate and contained no material
misstatements or omissions of a material fact.
1.16 Tax Filings. Public Company has duly filed all federal,
state, local and foreign tax reports and returns required to be
filed by it and has duly paid all taxes and other charges due or
claimed to be due from it by any federal, state, local or foreign
tax authorities. Further, the reserve for taxes, if any, reflected
in the balance sheet delivered hereunder is adequate and there are
no tax liens upon any property or assets of Public Company.
Further, no state of facts exists or has existed which would
constitute grounds for the assessment of any tax liability. All
deficiencies and assessments resulting from an examination of
state, local, federal and foreign tax returns and reports have been
paid. There are no outstanding agreements or waivers extending the
statutory period of limitation applicable to any federal, state,
local, or foreign tax return or report for any period. Public
Company is not a "consenting corporation" within the meaning of
Section 341(f)(1) of the Code.
1.17 Compliance With Law. Public Company is in compliance
with all laws, regulations and orders applicable to its business,
including but not limited to, all applicable laws, rules and
regulations of the U.S. Securities and Exchange Commission and all
applicable state securities departments. Further, Public Company
has not received any notification that it is in violation of any
laws, regulations or orders and, to the best knowledge of
management of Public Company, no such violations exist. Neither
Public Company nor any employee or agent of Public Company has made
any payment to any person which violates any statutes or law
required to be disclosed under applicable disclosure policies of
the Securities and Exchange Commission.
1.18 Disclosure. No representations or warranties by
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Public Company in this Agreement and no statement contained in any
document (including, without limitation, financial statements),
certificate or other writing furnished or to be furnished by Public
Company to Company or the Company Shareholder pursuant to the
provisions hereof or in connection with the transactions
contemplated hereby, contained or will contain any untrue statement
of material facts or omits or will omit to state any material fact
necessary in order to make the statements herein or therein, in
light of the circumstances under which they were made, not
misleading. There are no facts known to Public Company which,
either individually or in the aggregate, could or would materially
and adversely affect or involve any substantial possibility of
having a material and adverse effect on the condition (financial or
otherwise), results of operations, assets, liabilities or business
of Public Company.
1.19 Officers' Certificates. At closing, the President of
Public Company shall provide to the satisfaction of Company, to the
effect that:
(a) Public Company is not currently conducting, and has never
been engaged in, any business other than set forth in its Form.
(b) Public Company has delivered audited financial statements
dated, and for the fiscal year ended, April 30, 1996, together with
all Notes thereto, prepared in reasonable detail in accordance with
generally accepted accounting principles applied on a consistent
basis, which financial statements contain a balance sheet dated
April 30, 1997, and the following statements for the period then
ended: a statement of operations, a statement of stockholders'
equity, and a statement of cash flows. Further, Public Company has
delivered, or will deliver upon request of Company, all books and
records, as well as all required substantiating documentation, to
Company, which are necessary to compile financial statements for
periods subsequent to the date of, and the periods covered by, the
most recent financial statements delivered hereunder. Further,
Public Company has delivered, or otherwise made available, true and
correct copies of the Articles of Incorporation and bylaws of
Public Company, minutes of all meetings of its directors and
shareholders, true and correct copies of all filings made in
respect of Public Company's initial public offering and such other
and further material as has been requested.
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(c) Since the date of the most recent financial statements
delivered hereunder, Public Company has not (unless otherwise
described herein):
(1) Suffered any material and adverse change in its financial
condition, working capital, assets, liabilities, reserves,
business, operations or prospects;
(2) Suffered any loss, damage, destruction or other casualty
materially and adversely affecting any of its properties, assets or
business (whether or not covered by insurance);
(3) Borrowed or agreed to borrow any funds or incurred, or
assumed or become subject to, whether directly or by way of
guarantee or otherwise, any obligation or liability;
(4) Paid, discharged or satisfied any claims, liabilities or
obligations, other than in the ordinary course of its business;
(5) Permitted or allowed any of its property or assets (real,
personal or mixed, tangible or intangible) to be subjected to any
mortgage, pledge, lien, security interest, encumbrance, restriction
or charge of any kind;
(6) Canceled any debts or waived any claims or rights of
substantial value, or sold, transferred, or otherwise disposed of
any of its properties or assets (real, personal or mixed, tangible
or intangible);
(7) Granted any increase in the compensation of directors,
officers or employees (including any such increase pursuant to any
bonus, pension, profit-sharing or other plan or commitment) or any
increase in the compensation payable or to become payable to any
director, officer or employee;
(8) Made any capital expenditure or commitment other than in
the normal course of its business or as disclosed herein;
(9) Declared, paid or set aside for payment any dividend or
other distribution in respect of its capital stock or, directly or
indirectly, redeemed, purchased or otherwise acquired any shares of
its capital stock or other securities, other than as required
hereunder to consummate the transaction proposed herein;
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(10) Made any change in any method of accounting or
accounting practice;
(11) Paid, loaned or advanced any amount to, or sold,
transferred or leased any properties or assets (real, personal or
mixed, tangible or intangible) to, or entered into any agreement or
arrangement with, any of its directors or officers or any affiliate
or associate of any of its directors or officers;
(12) Entered into any transaction, contract or commitment
other than as described in the Public Company Form, or as otherwise
previously described to Company;
(13) Been subject to any other event or condition of any
character that has or might reasonably have a material and adverse
effect upon the financial condition, business, assets or properties
of Public Company;
(14) Agreed, whether in writing or otherwise, to take any
action described in this paragraph of the Agreement;
(d) Between the date of the most recent financial statements
delivered hereunder and the date of this Agreement, Public Company
has conducted its business in the same manner as conducted before
the date of such financials and in accordance with the Public
Company Business Plan described in its Form.
(e) There is not currently any employment or severance
agreement to which Public Company was or is subject, or by which it
was or is bound. Further, no such agreements will arise in the
future as a result of acts which have occurred previous to, or
concurrent with, the date hereof.
(f) There is no litigation or proceeding pending or
threatened against or relating to Public Company, or its business.
(g) Public Company is not a party to any contract, agreement,
permit, license, plan, lease or similar arrangement which will
survive closing, other than its existing agreement with its
transfer agent.
(h) The execution and delivery by Public Company of this
Agreement and the performance of its obligations have not
conflicted and will not conflict with any provisions of law,
10
<PAGE>
statute, rule or regulation or any judgment applicable to or
binding upon Public Company, nor will it result in the creation of
any lien, charge or encumbrance. No consent, approval,
authorization or order of any court or governmental authority or
third party has been or is required in connection with the
execution and delivery by Public Company of this Agreement or the
consummation of the transactions evidenced hereby. Neither the
execution nor the consummation of this Agreement in accordance with
the terms and conditions set forth herein, has conflicted or will
conflict with or constitute a default under or a breach or
violation or grounds for termination of or an event which with the
lapse of time or notice and the lapse of time could or would
constitute a default under the Articles of Incorporation, as
amended, or bylaws of Public Company.
(i) Public Company is in compliance with all laws, regulations
and orders applicable to its business. Further, Public Company has
not received any notification that it is in violation of any laws,
regulations or orders and no such violations exist. Neither Public
Company, nor any employee or agent of Public Company, has made any
payment to any person which violates any statutes or law required
to be disclosed under applicable disclosure policies of the
Securities and Exchange Commission.
ARTICLE II
REPRESENTATIONS AND WARRANTIES
OF COMPANY AND THE COMPANY SHAREHOLDERS
Company and the Company Shareholders represent and warrant to
Public Company as follows:
2.1 Organization and Good Standing. Company is a corporation
duly organized, validly existing and in good standing under the
laws of the State of Louisiana and has all corporate powers
required to carry on its business. Company is qualified to do
business and is in good standing as a foreign corporation in all
jurisdictions wherein the character of its properties or the nature
of its business makes such qualification necessary.
2.2 Authorization. The Company Shareholders have duly
11
<PAGE>
taken all action necessary to authorize the execution and delivery
of this Agreement and to authorize the consummation of the
transactions evidenced hereby and the performance of their
obligations and the obligations of Company hereunder.
2.3 No Conflicts or Consents. The execution and delivery by
the Company Shareholders of this Agreement and their performance of
those obligations set forth herein have not conflicted and will not
conflict with any provision of law, statute, rule or regulation or
of any agreement or judgment applicable to or binding upon them or
Company, or result in the creation of any lien, charge or
encumbrance upon any of their assets or properties, or upon those
of Company. No consent, approval, authorization or order of any
court or governmental authority or third party is required in
connection with the execution and delivery by Company, or by the
Company Shareholders, of this Agreement or the consummation of the
transactions evidenced hereby. Neither the execution of this
Agreement nor its consummation in accordance with its terms has
conflicted or will conflict with or constitute a default under or
breach or violation or grounds for termination of or an event which
with the lapse of time or notice and the lapse of time would or
could constitute a default under any note, indenture, mortgage,
deed of trust or other agreement or instrument to which Company or
the Company Shareholders are a party or by which either or all of
them are bound.
2.4 Enforceable Obligations. This Agreement is a legal and
binding obligation of Company and the Company Shareholders,
enforceable in accordance with its terms, except as limited by
bankruptcy, insolvency or other laws of general application
relating to the enforcement of creditor's rights and general
equitable principles.
2.5 Capitalization. The authorized capital stock of Company
consists of 10,000,000 shares of common stock, of which 4,102,500
are issued in outstanding and fully paid for and nonassessable.
Company has no outstanding rights, options, warrants, contracts,
commitments or demands of any character which would require the
issuance (or transfer out of treasury), by Company of any shares of
its capital stock. All outstanding securities were issued in
accordance with applicable federal and state securities laws or
exemptions therefrom.
2.6 Financial Statements. Company shall deliver
12
<PAGE>
audited financial statements dated, and for the period ended, March
31, 1998, together with all notes thereto, prepared in reasonable
detail in accordance with generally accepted accounting principles
applied on a consistent basis, to Public Company on or before the
Closing Date.
2.7 Other Information and Inspections. Company has made
available for inspection and copying all books and records of
Company and has fully and completely furnished to Public Company
such information as has been requested.
2.8 Disclosure. No representations or warranties by Company
or the Company Shareholders in this Agreement and no statement
contained in any document, certificate or other writing furnished
or to be furnished by Company or the Company Shareholders to Public
Company pursuant to the provisions hereof, or in connection with
the transaction contemplated hereby, contained or will contain any
untrue statements of material facts or omits or will omit to state
any material fact necessary in order to make the statements herein
or therein, in light of the circumstances under which they were
made, not
misleading. Unanimous consents of the Company Shareholders and
directors were executed, to be effective on when the Closing
occurs. Under the respective consents, all transactions evidenced
hereby obtained the requisite approval.
ARTICLE III
CLOSING AND EXCHANGE OF SHARES
3.1 Terms of the Exchange. On the Closing Date, or such date
as stated below:
(a) On the Closing Date, Public Company shall cause the
following to occur simultaneously with the Closing:
(1) A forward split of 4 to 1 for all pre-exchange Public
Company common shares, making the total issued and outstanding
common shares as of the Closing Date 4,000,000 shares;
(2) Issuing to the Company Shareholders, in an
13
<PAGE>
acceptable form, certificates for 8,205,000 by the Company)
"restricted" shares (post forward split by the Company of 2 to 1),
of its no par value voting common stock (the "Exchange Shares"),
free and clear of all mortgages, pledges, claims, liens and other
rights and encumbrances whatsoever.
(b) The Exchange Shares shall not be subject to any
preemptive rights, options or similar rights on the part of any
shareholder or creditor of Public Company, or any other person
whatever.
(c) The Company Shareholders shall, in consideration for
their receipt of the Exchange Shares, transfer and deliver to
Public Company certificates representing all 4,102,500 of the pre-
forward split (2 to 1) issued and outstanding Company Shares owned
by them. Public Company shall receive good and merchantable title
to the Company Shares, which shall be transferred to Public Company
free and clear of all liens, mortgages, pledges, claims or other
rights or encumbrances whatever.
3.2 Restrictions on Transfer. The Exchange Shares, when
issued and delivered hereunder, will not be registered under the
Securities Act of 1933, as amended, nor will the Company
Shareholders be granted any registration rights under such Act as
to such shares. The Company Shareholders shall execute and deliver
to Public Company an investment letter satisfactory in form and
substance to Public Company's counsel which states, among other
things, that the Exchange Shares have been acquired for investment
and with no present intent to make any resale, assignment, transfer
or hypothecation of all or any part thereof and that the
certificates representing the Exchange Shares will bear a
restrictive legend which states in effect that such shares have not
been registered under the Securities Act of 1933, as amended, and
consequently may not be resold, assigned, transferred or
hypothecated unless registered under such Act or, in the opinion of
Public Company's counsel, an exemption from the registration
requirements of such Act is available for any such transaction.
3.3 Changes in Capitalization of Public Company. If, between
the date of the most recent financial statements of Public Company
delivered to Company and the Company
Shareholders and the Closing Date, the outstanding shares of
the capital stock of Public Company are found to have been
increased, decreased, changed into or exchanged for a
14
<PAGE>
different number or kind of said shares or securities of Public
Company through reorganization, reclassification, stock dividend
stock split, reverse stock split or similar change in the
capitalization of Public Company and such has not been disclosed to
the Company Shareholders hereunder, Public Company, at the election
of the Company Shareholders, shall issue and deliver to the Company
Shareholders such number of Public Company shares as will reflect
an equitable adjustment of the Public Company shares specified in
Paragraph 1 of this Article III on account of any such increase,
decrease, change or exchange. In the event of any such change in
the capitalization of Public Company, all references to the shares
herein shall refer to the number of Public Company shares as thus
adjusted. However, it is specifically acknowledged, agreed and
understood that the shareholders of Public Company have
conditionally approved a proposal to undertake a "forward split" of
the Public Company common stock, wherein 20 shares of common stock
issued and outstanding will be exchanged for 1 share of common
stock, as well as additional matters more specifically stated in
that certain Proxy Statement, which is in progress and which will,
when completed, be attached hereto and incorporated herein as
Exhibit "B". The sole condition to the approval of the aforesaid
forward stock split is the successful consummation of the
transaction proposed herein. Public Company shall have no
obligation to issue any additional shares to the Company
Shareholders as described herein as a result of the aforesaid
reverse stock split. As part of the Closing also amend the
Certificate or Articles of Incorporation to increase the authorized
common stock to 50,000,000 shares, $.001 par value.
3.4 Closing Date/Effective Date. The Closing Date of the
transactions contemplated hereby shall be May 31, 1998, or such
earlier or later date as the parties may so choose thereafter. All
representations of the parties hereto shall survive the closing and
the representations and warranties shall be made as in effect on
the Closing Date.
The Effective Date shall be the date in which all of the
certificates necessary to effectuate this transaction have been
duly issued by the respective party and all other matters relevant
to the closing of the transaction contemplated herein have been
accomplished.
3.5 Closing Documents.
15
<PAGE>
A. To Be Delivered by Public Company:
(1) Certificates representing 8,205,000 shares of
"restricted" common stock to the Company Shareholders;
(2) Certified copy of minutes of shareholder and
directors, authorizing this transaction;
(3) Certificate of Good Standing;
(4) Opinion of legal counsel acceptable to Company;
(5) Resignation letters of Bruce Crawford and Kristin
Walker as officers and directors, as applicable, along with the
resignation letter of Gerard Jackson as director.
(6) Letter from present independent certified public
accountant, resigning from said position and further indicating
that the basis of their resignation does not arise from any changes
in or disagreements with the management of Public Company on any
issue of accounting practices or procedure.
(B) To be delivered by Company or Company Shareholders:
(1) Original certificates representing 4,102,500 shares of
Company, (representing all of the issued and outstanding shares of
the Company pre-forward split, 2 to 1)together with an assignment
of said shares, separate from said Certificates (if requested by
Public Company);
(2) Certified copy of minutes of shareholders and
directors of Company, authorizing this transaction;
(3) Certificate of Good Standing;
(4) Legal opinion of counsel, acceptable to Public
Company;
(5) Certificate of President;
(6) Investment letter from Company Shareholders relating
to issuance of Public Company common stock relevant herein.
16
<PAGE>
ARTICLE V
COVENANTS OF COMPANY AND THE COMPANY SHAREHOLDERS
Company and, insofar as they have the power to direct Company
by ownership of voting securities or otherwise, the Company
Shareholders (Company and the Company Shareholders being
collectively referred to below as the "Company Parties"), covenant
and agree that, prior to the Effective Date:
5.01 Effectuation of this Agreement. The Company Parties
will use their best efforts to cause this Agreement to become
effective, and all transactions herein contemplated to be
consummated, in accordance with their terms, to obtain all required
consents and authorizations of the Company Parties, to make all
filings and give all notices to those regulatory authorities or
other third parties which may be necessary or reasonably required
in order to effect the transactions contemplated in this Agreement,
and to comply with all federal and state securities laws and other
laws as may be applicable to the contemplated transactions.
5.02 Transactions. The Company Parties will carry on
Company's business diligently and substantially in the same manner
as heretofore conducted, and will not enter into any transactions
which are not in the ordinary course of Company's business, or
which would singly or in the aggregate be materially adverse to
Company's business, prospects or financial condition, taken as a
whole, or which had not been previously disclosed to Public
Company.
5.03 Conduct of Business. (a) The Company Parties will
not (i) permit or do or cause to be done anything which
Company has represented in Article II not to have been done, except
as otherwise permitted in this Agreement or consented
to by Public Company in advance and in writing; (ii) make or permit
any amendment to Company's Articles of Incorporation
or bylaws; (iii) cause or permit to be declared or paid any
dividend, stock split, combination (reverse split) or other
recapitalization or distribution in respect of Company's
common stock, nor cause or permit the issuance of any
additional shares of Company's common stock; (iv) permit the
increase of compensation of any type to any director or
officer or other employee of Company; (v) to the best ability
of the Company Parties, permit or do any act or omission to
act the effect of which would be to breach or violate any
17
<PAGE>
contract or commitment to which Company is a party; (vi) to the
best ability of the Company Parties, permit or cause the waiver of
the provisions of any statute of limitations applicable to the levy
or assessment of any federal, state, municipal or foreign taxes
payable by Company; or (vii) organize any subsidiary of Company, or
acquire or permit the acquisition of any equity interest in any
other business or entity, with the exception of those proposed
transactions presently in negotiations and disclosed herein.
(b) To the best of their ability, the Company Parties will:
(i) maintain Company's books, accounts, and records as now being
maintained, on a consistent basis; (ii) maintain Company's
properties in good repair; (iii) comply with and not violate any
law, rule, regulation, or ordinance whatever applicable to Company
or its business or any license or permit issued to Company; and
(iv) take each and every step necessary to preserve the charter
issued by the State of Florida, including timely filing of
corporate reports and current payment of all taxes now and
hereafter due and owing.
5.04 Issuance of Additional Securities. Company shall not
issue or permit the issuance of any common stock of Company or of
any warrant, option or other right to subscribe for or acquire
common stock or any other securities whatever of Company, nor shall
any stock option or stock purchase plan, incentive stock option
plan or similar plan be adopted whereby persons could acquire
securities of Company, or any option or similar right to acquire
such securities.
5.05 Publicity and Filings. All press releases, shareholder
communications, filings with the Securities and Exchange Commission
or other governmental agency or body and other information and
publicity generated by Company regarding the transactions
contemplated in this Agreement shall be reviewed and approved by
Public Company and its counsel before release or dissemination to
the public or filing with any governmental agency or body whatever.
5.06 Access. The Company Parties agree that they will allow
Public Company's directors, officers, accountants, attorneys and
other representatives full access, during
normal business hours throughout the term or applicability of this
Agreement, to all information whatever concerning
Company's respective affairs, operations and properties as
Public Company may reasonably request. All information
provided shall be furnished strictly subject to the
18
<PAGE>
confidentiality provisions of this Agreement. The Company Parties
may refuse to allow copies or abstracts to be made of any formula,
design plans for machinery or equipment, or any plans or details as
to manufacturing or chemical processes, and the like; provided that
representatives of Public Company shall be allowed access to such
things for inspection, in order to satisfy themselves that such
things exist and are substantially as represented to Public
Company.
5.07 Stand-Still Agreement. Other than those potential
acquisitions which have previously been disclosed to Public
Company, the Company Parties agree not to solicit from any third
party an offer or expression of interest in or with respect to any
acquisition, combination or similar transaction involving Company,
or substantially all of its assets or securities (whether
outstanding or authorized but unissued) and further agree that they
will promptly inform Public Company of the existence of any such
unsolicited offer or expression of interest.
ARTICLE VI
COVENANTS OF PUBLIC COMPANY
Public Company covenants and agrees that, prior to the
Effective Date:
6.01 Effectuation of this Agreement. Public Company will use
its best efforts to cause this Agreement to become effective, and
all transactions herein contemplated to be consummated, in
accordance with their terms, to obtain all required consents and
authorizations of third parties, to make all filings and give all
notices to those regulatory authorities or other third parties
which may be necessary or reasonably required in order to effect
the transactions contemplated in this Agreement, and to comply with
all federal and state securities laws and other laws as may be
applicable to the contemplated transactions.
6.02 Conduct. (a) Public Company will not (I) permit or
do or cause to be done anything which Public Company has
represented in Article I not to have been done, except as otherwise
permitted in this Agreement, or consented to by
19
<PAGE>
Company in advance and in writing; (ii) make or permit any
amendment to the Public Company Articles of Incorporation or
bylaws, other than those matters included in Exhibit "B" hereto;
(iii) cause or permit to be declared or paid any dividend, stock
split, combination (reverse split) or other recapitalization or
distribution in respect of Public Company's capital stock, other
than as disclosed in the aforesaid Proxy documents; (iv) to Public
Company's best ability, permit or cause the waiver of the
provisions of any statute of limitations applicable to the levy or
assessment of any federal, state, municipal or foreign taxes
payable by Public Company.
(b) To the best of its ability, Public Company will: (I)
maintain its books, accounts and records as now being maintained,
on a consistent basis; (ii) comply with and not violate any law,
rule, regulation or ordinance whatsoever applicable to Public
Company; and (iii) take each and every step necessary to preserve
the charter issued by the State of Delaware, including timely
filing of corporate reports and current payment of all taxes now
and hereafter due and owing.
6.03 Access. Public Company agrees that it will allow
Company's directors, officers, accountants, attorneys and other
representatives full access, during normal business hours
throughout the term or applicability of this Agreement, to all
information whatever concerning its affairs as the Company Parties
may reasonably request. All information provided shall be
furnished strictly subject to the confidentiality provisions of
this Agreement.
ARTICLE VII
GENERAL PROVISIONS
7.1 Further Assurances. At any time and from time to time
after the date of this Agreement, each and every party hereto shall
execute such additional instruments and take such other and further
action as may be reasonably requested by any other party to carry
out the intent and purpose of this Agreement.
7.2 Waiver. Any failure on the part of any party
hereunder to comply with any of their obligations, agreements
or conditions may be waived in writing by the party to whom
such compliance is owed; however, waiver on one occasion does
not operate to effectuate a waiver on any other occasion.
20
<PAGE>
7.3 Brokers. Each party represents to every other party that
no brokers or finders have acted for it in connection with this
Agreement and that no obligations of Public Company, Company and
the Company Shareholders need to be satisfied as of the date of
this Agreement.
7.4 Notices. All notices and other communications hereunder
shall be in writing and shall be deemed to have been given if
delivered in person or sent by prepaid, first class, registered or
certified mail, return receipt requested, as first set forth above;
and for the Company Shareholders as set forth under their names on
Exhibit A.
7.5 Entire Agreement. This Agreement constitutes the entire
agreement between the parties and supersedes and cancels any other
agreement, representation or communication, whether oral or
written, between the parties and relating to the transactions
evidenced hereby or the subject matter hereof.
7.6 Headings. The article and paragraph headings in this
Agreement are inserted for convenience only and shall not affect in
any way the meaning or interpretation of this Agreement.
7.7 Governing Law. This Agreement shall be governed by and
construed and enforced in accordance with the laws of the state in
which the Public Company is domiciled.
7.8 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.
7.9 No Oral Modification. This Agreement may be amended
solely in writing, and only after the mutual agreement of the
parties affected hereby.
7.10 Survival of Representations, Warranties and Covenants.
The representations, warranties, covenants and agreements contained
herein shall survive the date and execution of this Agreement.
7.11 Legal Counsel; Expenses. The parties hereby acknowledge
that they have had an opportunity to obtain legal counsel for
Company, that Gianesin & Associates, Bryan A. Gianesin, Esq., has
acted as counsel for Public Company and
21
<PAGE>
that the Company Shareholders have consulted Terri L. Bush, Esq. in
respect of all matters leading to, and including, the transactions
evidenced hereby.
7.12 Simultaneous Closing. Public Company and the Company
Parties specifically acknowledge and represent that the closing
hereunder was, in effect, simultaneously completed with Public
Company and the Company Parties on the date of this Agreement.
7.13 Rescission of Agreement. The parties hereby agree that
they are relying on the representations and projections contained
in this Agreement, in the Company Business Plan and in other
documents regarding the future of the Company submitted to the
Public Company. In the event that such any such representations,
projections or material facts about Company are found to be untrue,
or otherwise materially affect the business prospects of the Public
Company and/or the value of the securities issued by the Public
Company, a majority of the shareholders of the Public Company (as
determined as of the date immediately prior to the execution of
this Agreement) may immediately rescind this Agreement with written
notice to the Company and may return to the Company all of its
assets and liabilities as if the transaction contemplated hereby
had never taken place. In addition, the parties hereto may
mutually agree to rescind this Agreement by executing a writing to
that effect, which shall operate in the same manner as if Public
Company had given unilateral written notice to the Company.
No decision of any court or other governmental or regulatory agency
shall be necessary to effectuate the rescission. The rescission
shall entitle the Public Company to proceed to elect new officers
and directors and to proceed to acquire a private company which has
a valid business plan and potential value to the shareholders of
the Public Company. A notice of rescission to the Company shall
not entitle the Company or its shareholders to obtain any damages,
fees or other costs from the Public Company or its shareholders as
a result of the rescission and the Company shall only be entitled
to those assets which were in existence as of the date immediately
preceding the effective date of this Agreement.
IN WITNESS THEREOF, the parties hereto have caused this
Agreement to be executed on the date and year first above written.
22
<PAGE>
PASCAL VENTURES, INC., a Delaware
corporation ("PUBLIC COMPANY")
s/Bruce Crawford
_________________________________
Bruce Crawford, President
PUBLIC COMPANY
Attest:
s/Kristin Walker
________________________________
Kristin Walker, Secretary
SOUTHERN STATES POWER COMPANY, INC., a
Louisiana corporation ("COMPANY")
s/Heber Bishop
__________________________________
Heber Bishop, President
COMPANY
Attest:
s/Terri L. Bush
_________________________________
Terri L. Bush, Secretary
COMPANY SHAREHOLDERS:
s/Heber Bishop
_________________________
Heber Bishop
s/James R. Bunnell
_________________________
James R. Bunnell
s/Terri L. Bush
_________________________
Terri L. Bush
s/Desai Living Trust
_________________________
Desai Living Trust
23
<PAGE>
s/Jayesh & Meena Desai
_________________________
Jayesh & Meena Desai
s/Robert Deutsch
_________________________
Robert Deutsch
s/Bryan Eget
_________________________
Bryan Eget
s/Antoinette Fowler
_________________________
Antoinette Fowler
s/Paul & Bobbi Kouri
_________________________
Paul & Bobbi Kouri
s/The Patel Trust Dated 1/13/94
_________________________
The Patel Trust Dated 1/13/94
s/Shailesh & Sudha Patel Living Trust 1997
_________________________
Shailesh & Sudha Patel Living Trust 1997
s/Robert B. Raines, Jr.
_________________________
Robert B. Raines, Jr.
s/Roberto Jose Ruiz Living Trust
________________________
Roberto Jose Ruiz Living Trust
s/Curt Thurmon
________________________
Curt Thurmon
s/B.A.T. International
________________________
B.A.T. International
s/Hemisphere Group, Inc.
________________________
Hemisphere Group, Inc.
s/Southern States Gas Gathering System, LLC
________________________
Southern States Gas Gathering System, LLC
24
<PAGE>
s/Southern States Oil Production, LLC
________________________
Southern States Oil Production, LLC
s/Unlimited Group
________________________
Unlimited Group
25
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE AUDITED
BALANCE SHEET AS OF MARCH 31, 1998, AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> MAR-31-1998
<PERIOD-END> MAR-31-1998
<CASH> 1,000,000
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 1,010,000
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 1,010,000
<CURRENT-LIABILITIES> 0
<BONDS> 0
0
0
<COMMON> 3,005
<OTHER-SE> 1,006,995
<TOTAL-LIABILITY-AND-EQUITY> 1,010,000
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 0
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
