SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-SB-A2
GENERAL FORM FOR REGISTRATION OF SECURITIES
PURSUANT TO SECTION 12(G) OF THE SECURITIES EXCHANGE ACT OF 1934
OASIS ENTERTAINMENT'S FOURTH MOVIE PROJECT, INC
Nevada 88-0403762
(Jurisdiction of Incorporation) (I.R.S. Employer Identification No.)
24843 Del Prado, Suite 326, Dana Point CA 92629
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (949) 249-1765
The following Securities are to be registered pursuant to Section 12(g) of the
Act:
Common Voting Equity Stock
14,810,000
June 28, 2000
The EXHIBIT INDEX is located at page 44 of this Registration Statement
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UNNUMBERED ITEM: INTRODUCTION
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This registration statement is voluntarily filed pursuant to Section
12(g) of the Securities Exchange Act of 1934, in order to comply with the
requirements of National Association of Securities Dealers for quotation on the
Over-the-Counter Bulletin Board, often called OTCBB . This Registrant's common
stock is not presently quoted on any exchange at the present time. The
requirements of the OTCBB are that the financial statements and information
about the Registrant be reported periodically to the Commission and be and
become information that the public can access easily. This Registrant wishes to
report and provide disclosure voluntarily, and will file periodic reports in the
event that its obligation to file such reports is suspended under the Exchange
Act. If and when this 1934 Act Registration is effective and clear of comments
by the staff, this Registrant will be eligible for consideration for the OTCBB
upon submission of one or more NASD members for permission to publish quotes for
the purchase and sale of the shares of the common stock of the Registrant.
While we have no present intention of doing so, it is possible that we may
become the subject of a Reverse Acquisition at some undetermined future time.
A reverse acquisition is the acquisition of a private ( Target ) company by a
public company, by which the private company's shareholders acquire control of
the public company. We have not determined to pursue a reverse acquisition
transaction, although we disclose that possibility, nor have we identified any
acquisition target. In the event that such a transaction is determined to be
pursued, we cannot project what the intentions of such an unidentified target
might be, for engaging in a reverse acquisition. We can evaluate what be believe
are the general advantages and disadvantages for such a target, in considering a
reverse acquisition. First, a reverse acquisition does not register any shares
of stock for sale or for resale. It is not a substitute for a 1933 Act
Registration of shares for sale or resale. Shares which may be issued by us, in
connection with such an acquisition would be restricted securities and would not
be freely tradable except in compliance with the holding periods and other
provisions of Rule 144. We believe that the advantage to such a target company,
in choosing a reverse acquisition with a public company would be its
quotablility, so that a market price for its shares might be determinable, and
so that when, after such an acquisition, the new resulting company may engage in
capital formation, its prospective investors might obtain market quotes to
assist them in making investment decisions. While no such arrangements or plans
have been adopted or are presently under consideration, it would be expected
that a reverse acquisition of a target company or business, if such a
transaction were determined to be pursued by us, would be associated with some
private placements and/or limited offerings of common stock for cash. Such
placements, or offerings, if and when made or extended, would be made with
disclosure and reliance on the businesses and assets to be acquired, and not
upon our the present condition.
ITEM 1. DESCRIPTION OF BUSINESS.
(A) BUSINESS DEVELOPMENT.
(1) FORM AND YEAR OF ORGANIZATION. This Corporation Oasis Entertainment's
Fourth Movie Project, Inc. is the Registrant. We will refer it as "we", "us" and
"our" unless the context otherwise requires. We were duly incorporated in Nevada
on April 9, 1998. We have on file with the Securities and Exchange Commission an
Amended Form 1-A/Regulation A Offering Statement (File No. 24-3948) under the
Securities Act of 1933, as amended. In that Offering Statement our business was
described to be the production of low-budget films for theatrical, cable and
video release.
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As a practical matter, we are required to register our common stock pursuant to
12(g) of the 1934 Act, and to pursue continued acceptance for quotation on the
OTCBB. There are no lock-up or shareholder pooling agreements between or among
our shareholders. All shares are owned and controlled independently by the
persons to whom they are issued. We have no Internet address.
FOUNDERS SHARES: On April 9, 1998, 5,000,000 shares of common stock were
issued to each of the Registrant's two founders and recorded at predecessor cost
of $-0-.
FURTHER ISSUANCES: On September 30, 1998, 1,500,000 shares of common stock
were issued and on April 20, 1999, 3,310,000 shares of common stock were issued
at $0.10 per share for a total of $481,000 pursuant to an exemption from
registration in an offering made in reliance upon the exemption provided by
Regulation A of the Securities Act of 1933 to a total of 41 accredited
investors. The total shares placed pursuant to Reg A, at $0.10 per share was
4,810,000.
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Issuance:. . . . Original
Issuances
Reference Number Forward Split
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Exemption. . . .
1 to 1,000
1- 4(2) 10,000,000
2- Reg. A. . . . 1,500,000
3- Reg. A. . . . 3,310,000
Totals . . . . . 14,821,000
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(2) BANKRUPTCY, RECEIVERSHIP OR SIMILAR PROCEEDING. None from inception
to date.
(B) BUSINESS OF THE ISSUER. Pursuant to our original business plan, we
produced one full-length movie entitled "The Blood Game" intended for adult
video and cable release. Its subject matter is adventure, and it contains nudity
and violence. It was completed in November of 1999. The movie was produced for
a cost of $174,360. This cost was expensed in full when incurred due to the
uncertainty of the recoverability of the investment. We continue to hope to
recover these costs by eventual marketing of this motion picture. We have as yet
been unsuccessful in our efforts to sell or distribute this movie. While we have
not abandoned our intention to market our production, there are no assurances
that we will be able to sell or distribute this movie. If we are unsuccessful in
these efforts, or if there is only limited distribution of the movie, then all
or a part of the production cost may be lost.
BLOOD GAME. The subject of the movie is an erotic action thriller based upon a
man's struggle to rescue a woman from a gang of weekend warriors and winds up
having to rescue himself. The movie was completed in November 1999. The
distribution efforts began in late December 1999 when over sixty preview copies
were sent to distributors accepting this type of genre. The distribution
consisted of media packets containing copies of the film and trailer, a one
sheet on the movie and stars, and a personalized letter to the individual
distributors. The media packets were received on or around January 10, 2000.
There were two responses that proposed purchasing and/or distributing options,
Troma Films and Victory Multimedia. These negotiations are currently in
progress, however, they have been slow and unassuring of a profitable
distribution and/ or purchase agreement.
Due to the distribution problems encountered with the "Blood Game" and due
to recent changes in the entertainment industry regarding the technological
demands of producing, the Officers and Directors of Registrant have reviewed and
analyzed the current business plan of "producing low budget movies." The
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business analysis concluded that the current business plan projected diminishing
returns and great margins of risk. The technology in the movie industry was
changing so rapidly that the cost for production may exceed gross revenue for
"made-for-cable and video features." The industry trade publications predicted
that the following two years would see an emergence of the major movie studios
into the smaller markets such as "made-for-cable and video features,"
independent films, and Internet programming due to the changes in market demands
for content, medium and genre. The Registrant also lacks the capital resources
presently to fund multiple productions in one period, which is a growing
necessity to compete in the industry. Accordingly, we may seek additional
funding from our existing shareholders or the public, to attempt further
production, but we have not determined whether such a course is in the best
interests of our shareholders.
INFOMERCIALS. Meanwhile, an opportunity to produce and finance direct response
television programs arose. An emerging "Direct Response" company, Reliant
Interactive Media Corp. ("Reliant") approached the Registrant to finance and
co-produce direct-response television and electronic retailing programs. Reliant
is a full reporting public company trading under the symbol "RIMC" on the OTCBB.
After extensive due diligence, we concluded that the potential for profit and
growth in this new opportunity is attractive. We have accordingly expanded the
scope of our business to include and emphasize direct-response retailing
production. We have begun by entering into a contract with Reliant for financing
and co-producing three (3) direct-response television programs.
In the Agreement between Reliant and Registrant, dated March 24, 1999, we
provided $250,000 to Reliant for production of three infomercials. In
consideration of this financing, we received 250,000 shares of common stock of
Reliant and royalties equal to 2% of the adjusted gross revenues defined as
sales less returns, shipping and handling charges, received by Reliant up to a
maximum of $625,000. Thereafter, the royalty will be reduced to 1%. To date, no
royalties have been paid to Registrant under this Agreement. The first of the
three projects did not test well and was abandoned. The second was aired but was
not well received by the purchasing public. The remaining project tested more
favorably and may yet generate royalty revenues. It is airing currently.
Our active participation in Reliant's Infomercials was limited to
financing, some artistic and technical consulting, and some production
assistance for the "Natural Hair project.
In a separate transaction we made a loan of $300,000 to Reliant. The note
included interest at 10% per annum. As of December 31, 1999, principal and
accrued interest owing to us stood at $116,906.
As additional consideration for this loan and forbearance as to prompt
repayment, Reliant issued us an additional 5,000 shares of its common stock.
Reliant has notified Registrant that no additional financing is required
from Registrant, at the present time. We continue to correspond with Reliant
with a view to participation in future project as may become attractive for our
investment. Accordingly, the status of our relationship with Reliant is as
follows: (1) we are a shareholder of Reliant; (2) we have a loan partially
unpaid owing to us from Reliant; (3) we may become entitled to receive royalty
payments from the third project covered by our investment.
As a result of the foregoing transactions, we own 4% of the common stock of
Reliant.
REVERSE ACQUISITION CONTINGENCY. We have not abandoned our business plan to
achieve profitable distribution of Blood Game, nor our interest in further
participation in direct media advertising. We recognize, however, the
contingency that our present business activities may fail to achieve the
profitability for our shareholders to which we are committed. Accordingly, a
mature and sober analysis of our present business and assets requires us to
recognize the possibility of such failure, and the contingency that we would be
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required, in such a case, to pursue the acquisition of other profitable
businesses or assets, by some form of business combination. The most likely form
of such a combination would be by a reverse acquisition transaction.
Accordingly, the following additional disclosure is presented as to the nature
of such a contingency.
In the event that we determine to pursue a Reverse Acquisition transaction,
we would most likely proceed as follows. We would most likely spin-off our
assets to our shareholders, that is create a new wholly-owned subsidiary, place
our existing assets into that subsidiary and then distribute the ownership of
that subsidiary to our existing shareholders in proportion to their then
existing share ownership. We would likely issue a news release indicating our
interest in reverse acquisition target candidates. We would not travel or engage
in extensive or expensive advertising, but would wait for responses and
proposals to others. We would engage in no capital formation activities in
connection with such a transaction. While it is foreseeable that a Target
acquisition program may involve fund raising, such fund raising would not be
conducted by our present management, but rather would concern the acquisition
target and its management.
Due to circumstances unique to this Registrant, it is not in a position to
consider any specific proposal for the use of our corporation in reverse merger
transactions, for the reason that it is not now qualified for quotation on the
OTC Bulletin Board. Management has determined that it must so qualify itself by
this 1934 Act Registration of its common stock, as a class, pursuant to 12(g)
of the Securities Act of 1934, before it can present itself as a viable
competitor in the reverse acquisition arena.
LIMITED SCOPE AND NUMBER OF POSSIBLE ACQUISITIONS: We have indicated that
we may attempt to develop future movie projects, and may seek additional funding
from our shareholders. We have considered the possibility that we may pursue a
reverse acquisition, if we determine that such a course would best serve our
existing shareholder. Accordingly, the possibility of a reverse acquisition is a
contingency, and the following disclosure is provided about such an eventuality,
should it occur.
We would not intend to restrict our consideration to any particular
business or industry segment, and we may consider, among others, finance,
brokerage, insurance, transportation, communications, research and development,
service, natural resources, manufacturing or high-technology. Of course, because
of our limited resources, the scope and number of suitable candidate business
ventures available will be limited accordingly, and most likely we will not be
able to participate in more than a single reverse business acquisition venture,
should we pursue that course. Accordingly, we anticipate that we would not be
able to diversify, but may be limited to one merger or acquisition because of
limited financing. This lack of diversification will not permit us to offset
potential losses from one business opportunity against profits from another. To
a large extent, a decision to participate in a specific business opportunity may
be made upon management's analysis of the quality of the other firm's management
and personnel, the anticipated acceptability of new products or marketing
concepts, the merit of technological changes and numerous other factors which
are difficult, if not impossible, to analyze through the application of any
objective criteria. In many instances, it is anticipated that the historical
operations of a specific firm may not necessarily be indicative of the potential
for the future because of the necessity to substantially shift a marketing
approach, expand operations, change product emphasis, change or substantially
augment management, or make other changes. We would be dependent upon the
management of a business opportunity to identify such problems and to implement,
or be primarily responsible for the implementation of, required changes. Because
we may participate in a business opportunity with a newly organized firm or with
a firm which is entering a new phase of growth, it should be emphasized that we
might, in such a case, incur further risk due to the failure of the target's
management to have proven its abilities or effectiveness, or the failure to
establish a market for the target's products or services, or the failure to
prove or predict profitability.
In the event that we determine to pursue a Reverse Acquisition transaction,
we would most likely proceed as follows. We would most likely spin-off our
assets to our shareholders, that is create a new wholly-owned subsidiary, place
our existing assets into that subsidiary and then distribute the ownership of
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that subsidiary to our existing shareholders in proportion to their then
existing share ownership. We would likely issue a news release indicating our
interest in reverse acquisition target candidates. We would not travel or engage
in extensive or expensive advertising, but would wait for responses and
proposals to others. We would engage in no capital formation activities in
connection with such a transaction. While it is foreseeable that a Target
acquisition program may involve fund raising, such fund raising would not be
conducted by our present management, but rather would concern the acquisition
target and its management.
PROBABLE INDUSTRY SEGMENTS FOR ACQUISITION. While the Company would not
rule out its consideration to any particular business or industry segment,
Management would focus its principal interest in evaluating development stage
companies in the electronic commerce, high-technology, communication
technologies, information services and Internet industry segments. It is
nevertheless possible that an outstanding opportunity may develop in other
industry segments, such as finance, brokerage, insurance, transportation,
communications, research and development, service, natural resources,
manufacturing or other high-technology areas.
REPORTING UNDER THE 1934 ACT. Following the effectiveness of this 1934 Act
Registration of the common stock of this Registrant, certain periodic reporting
requirements will be applicable. First and foremost, a 1934 Registrant is
required to file an Annual Report on Form 10-K or 10-KSB, 90 days following the
end of its fiscal year. The key element of such annual filing is Audited
Financial Statement prepared in accordance with standards established by the
Commission. A 1934 Act Registrant also reports on the share ownership of
affiliates and 5% owners, initially, currently and annually. In addition to the
annual reporting, a Registrant is required to file quarterly reports on Form
10-Q or 10-QSB, containing audited or un-audited financial statements, and
reporting other material events. Some events are deemed material enough to
require the filing of a Current Report on Form 8-K. Any events may be reported
currently, but some events, like changes or disagreements with auditors,
resignation of directors, major acquisitions and other changes require
aggressive current reporting. All reports are filed and become public
information. The practical effects of the foregoing requirements on the criteria
for selection of a target company are two-fold: first, the target must have
audited or auditable financial statements, and the target must complete an audit
for filing promptly upon the consummation of any acquisition; and, second, that
the target management must be ready, willing and able to carry forth those
reporting requirements or face de-listing from the OTCBB, if listed, and
delinquency and possible liability for failure to report.
INCENTIVE TO ACQUISITION TARGET. The principal incentive to a target
company to be acquired by us in a reverse acquisition (and in effect to acquire
control of our corporation) would exist only when and if we complete our 1934
Act Registration of our common stock and thus become a public reporting company
qualified for quotation on the OTCBB. Such a target company would not have to
wait to achieve its ability to file reports as provided in the 1934 Act, but
could immediately report its combination with us. This ability to file public
reports and to be a reporting company is a precondition to qualification for
quotation on the OTCBB
TRANSACTIONS WITH MANAGEMENT. There is no that we would acquire a target
business or company, in a reverse acquisition, in which our present management
or principal shareholder, or affiliates, have an ownership interest.
Consideration has been given to corporate policy in this regard, and it has been
determined not to permit any transaction in other than an arm's length
acquisition of business assets owned and controlled by unrelated third party
interests. The basis for this policy is two fold: first, that related party
transactions are unnecessary in the judgment of management and involve risks not
necessary to invite; and second that related party transactions do not offer the
potential profitability for shareholders, that management believes exists
presently in the market place for public issuers amenable to reverse merger
transactions. The policy described in this paragraph has not been the subject of
any formal or binding adoption by our corporation and is the stated intention of
management. While it is possible that some variation from this policy might
occur, and a transaction might be considered with parties having some
relationship to us, on terms no less favorable to our shareholders, than a
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similar transaction with totally unrelated third parties, such a variation would
only occur with full disclosure to all shareholders, and only in the
overwhelming best interests of all shareholders and with shareholder approval.
The policy under discussion involves the contingency of a reverse
acquisition with change of control of our company. It does not relate to direct
acquisitions or investments by us, without a change of control. For example, our
investment and our relationship with Reliant Interactive Media is not a
transaction covered by this informal policy. There is no limitation in present
corporate policy upon direct investment in any profitable opportunity, other
than our corporate responsibility to act in the best interests of our
shareholders.
There is no present possibility of any business combination with Reliant in
the event we may elect to pursue a reverse acquisition. Reliant has expressed no
interest in acquiring us, and we have nothing to offer Reliant as an incentive
to be acquired by us. Reliant is already a full reporting company with extensive
revenues and assets.
FINDERS FEE FOR MANAGEMENT. No finder's fees will be payable to Management
in connection with any foreseeable reverse acquisition. Management is identified
with the principal shareholder. The Principal Shareholder's remaining share
ownership following any reverse acquisition, and the Principal Shareholder might
be expected to sell its controlling interest for consideration from the
acquiring shareholders of the acquisition target. Depending on the quality of
the target company, the principal shareholder may sell all, some, or none of the
control block, as matters for arm's length deal making, when it comes to that
stage. Additionally, the Principal Shareholder is the Principal Consultant and
provides, has provided and may provide corporate services to the Registrant,
billable hourly in an established and customary manner. No finder's fees,
commissions or other bonuses to Management, Principal Shareholder, or
affiliates, for securing or in connection with any acquisition, will be paid or
payable, as a matter of both current economic conditions and corporate policy.
Management has determined that in its view of the current market for such
transactions, such fees or bonuses are not justifiable. While this policy is
intended to refer to the contingent eventuality of a reverse acquisition, with
attendant change of control, in any case, management does not take finders fees
for doing its corporate responsibility for management of the affairs of our
corporation. Accordingly no finders fees were paid or are payable or will be
payable to management of this corporation, in connection with our direct
investment in Reliant or any other corporate opportunity. It is the view of
management that such fees would not be ethical or proper, and the benefit of any
such transactions should be shared proportionally with our shareholders. For
example, the transactions described with Reliant involved no finder's fees to
management, but was entirely a corporate opportunity and treated as such.
CONSULTANTS. We have only a single consultant, namely Intrepid
International Ltd., a Nevada Corporation. Our three Officers and Directors are
affiliates of Intrepid. Information about Intrepid is found in Item 7, of this
Part I. Our three Officers and Directors are affiliates of Intrepid. Information
about our Officers and Directors is found in Items 4 and 5 of this Part I.
Intrepid is a corporate service provider. It provides us with management
services, by which its affiliates serve as our management and various corporate
services including coordination of our auditing, and its counsel provides us
with services as our special securities counsel for the preparation of this
filing, and other securities related matters. Intrepid bills us monthly for its
management and other services, on a time-fee basis. Intrepid is also a
shareholder of our common stock. In the event we should pursue a reverse
acquisition at some future time, Intrepid, and its affiliates would not receive
any compensation in connection with such an acquisition, other than its normal
time-fees for services performed. In such a case, Intrepid would enjoy such
benefits of ownership of its common stock as might result from such an
acquisition. Our Agreement with Intrepid is provided as Exhibit 10.1.hereto.
No other consultants are presently engaged nor are there any plans to
retain any consultants currently or for the foreseeable future. It is, of
course, conceivable that should a target business be acquired, one or more
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consultants may be sought out by the management of the acquired entity,
following a change of control. As of this time, there is no basis upon which
Management could base anything more than mere speculation as to what manner of
consultant, what criteria for seeking or selecting consultants, or what term of
service any such consultant might require; for the reason that all such
consideration would be matters before the Management of the Registrant only if
the reverse acquisition contingency might arise, and after a change of control
which would result from a reverse acquisition.
LOAN FINANCING NOT ANTICIPATED. There are no foreseeable circumstances
under which loan financing will be sought or needed during Registrant's present
development stage. This statement should not be deemed to preclude additional
investment or funding by our existing shareholders.
DEPENDENCE ON MANAGEMENT. This Company is required to rely on Management's
skill, experience and judgment, both in regard to extreme selectivity, and in
any final decision to pursue any particular business venture, as well as the
form of any business combination, should agreement be reached at some point to
acquire or combine. Please see Item 2 of this Part, Managements Discussion and
Analysis or Plan of Operation, and also Item 7 of this Part, Certain
Relationships and Related Transactions.
COMPETITIVE BUSINESS CONDITIONS. Other better-capitalized firms are engaged in
the search for acquisitions or business combinations which firms may be able to
offer more and may be more attractive to acquisition candidates. We became a
candidate for reverse acquisition transactions only this past October.
Management, in evaluating market conditions and unsolicited proposals, has
formed the estimate that the selection of a business combination is probable
within the next twelve months. There is no compelling reason why we should be
preferred over other reverse-acquisition public corporation candidates. It has
no significant pool of cash it can offer and no capital formation incentive for
its selection. It has a limited shareholder base insufficient for acquisition
target wishing to proceed for application to NASDAQ. In comparison to other
public shell companies we are unimpressive, in the judgment of management, and
totally lacking in unique features which would make it more attractive or
competitive than other public shell companies . While management believes that
the competition of other public shell companies is intense and growing, it has
no basis on which to quantify its impression. There can be no assurance that we
would prove competitively attractive to the kinds of transactions we seek.
Please See the Item 2 of this part, Management Discussion and Analysis, for more
information and disclosure.
NUMBER OF TOTAL EMPLOYEES AND FULL-TIME EMPLOYEES. We have three officers who
devote an insubstantial amount of time to our affairs who serve without
compensation. They are officers and affiliates of our principal shareholder.
YEAR 2000 COMPLIANCE. We have encountered no year 2000 compliance issues or
problems. Item 2. MD&A SB 303
ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.
(A) PLAN OF OPERATION NEXT TWELVE MONTHS. Management and its Principal
Shareholder are of the opinion that presently high technology, telecommunication
and internet projects, some new start-up, some with significant research and
development in progress, are in the market for reverse acquisition candidates.
This Registrant is not, however, in a position to search or evaluate any such
opportunities. It will not do so, until its 1934 Act Registration of its common
stock is effective and clear of comments by the Staff of the Commission, and
until and unless it achieves quote-ability on the OTCBB. It has not been and is
not believed to be necessary for this Registrant to advertise, or for management
to travel in search of candidates. It is likely that management might travel in
connection with a candidate it intends to select and with which it intends to
enter into a committed relationship, at such time as it begins its search.
Extensive due diligence and evaluation of proposals is made by the principal
shareholder in connection with its own business, and perforce for the benefit of
this Registrant.
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(1) CASH REQUIREMENTS AND OF NEED FOR ADDITIONAL FUNDS, TWELVE MONTHS.
This Company has no immediate or foreseeable need for additional funding, from
sources outside of its circle of shareholders, and their consultants, during the
next twelve months. The expenses of its audit, legal and professional
requirements, including expenses in connection with this 1934 Act Registration
of its common stock, have been and continue to be advanced by its management and
principal shareholder. Management believes that no significant cash or funds
will be required for its Management to evaluate possible transactions, at such
time as it begins its search. The Registrant enjoys the non-exclusive use of
office, telecommunication and incidental supplies of stationary, provided by its
Officers and Attorneys, who are related to its sole Consultant. These Officers,
Directors, and Attorneys of these issuer are substantially the same as those of
its sole consultant, such that its maintenance expenses are minimal and
manageable during this period and for the foreseeable future.
In the event, consistent with the expectations of management, that no
combination is made within the next twelve months, this Registrant may be forced
to deal with minimal costs involved in maintenance of corporate franchise and
filing reports as may be required, when and if this 1934 Act registration is
effective. Should this become necessary, the maximum amount of such advances is
estimated not to exceed $20,000. These expenses would involve legal and auditing
expenses. The Consultant and Counsel have agreed, informally, to defer
compensation, pending acquisition. It is possible that any advances may be
settled by compensation in common stock. Should further auditing be required,
such services by the Independent Auditor may not be the subject of deferred
compensation, or compensation in stock.
The Registrant has no present business or business plan other than to seek
a profitable business combination, most likely in a reverse acquisition or
similar transaction. Accordingly, its plan is to seek one or more profitable
business combinations or acquisitions to secure profitability for shareholders.
The Registrant will be concentrating on selecting a business combination
candidate, when its 1934 Act Registration is effect and complete. No current
fund raising programs are being conducted or contemplated before merger,
acquisition or combination is announced, and then any such capital formation
would be offered to investors based upon the assets and businesses to be
acquired, and not on this Registrant in its present condition, without
businesses, revenues, or income producing assets.
It is unlikely that this Registrant can attract capital before it
identifies an acquisition target. It is likely that this Registrant can attract
capital when it has done so, based upon the attractiveness of businesses and
assets to be acquire.
This Registrant does not anticipate any contingency upon which it would
voluntarily cease filing reports with the SEC, even though it may cease to be
required to do so. It is in the compelling interest of this Registrant to report
its affairs quarterly, annually and currently, as the case may be, generally to
provides accessible public information to interested parties, and also
specifically to maintain its qualification for the OTCBB, if and when the
Registrant's intended applicable for submission be effective.
(2) SUMMARY OF PRODUCT RESEARCH AND DEVELOPMENT. None.
(3) EXPECTED PURCHASE OR SALE OF PLANT AND SIGNIFICANT EQUIPMENT. None.
(4) EXPECTED SIGNIFICANT CHANGE IN THE NUMBER OF EMPLOYEES. None.
(B) DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
(1) OPERATIONS AND RESULTS FOR THE PAST TWO FISCAL YEARS. We have had no
revenues from operations to date, other than limited interest income. We have
incurred general and administrative and interest expenses during these period.
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SELECTED FINANCIAL INFORMATION
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Six Months Fiscal Years
3/31/00 3/31/99 9/30/99 9/30/98
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Total Assets . . . . . $ 490 $ 3,151 $ 258,151 $ 150,000
Revenues . . . . . . . 0 0 0 0
Operating Expenses . . 25,852 142,113 214,396 0
Interest Income. . . . 0 1,300 24,885 0
Interest (Expense) . . 0 0 (4,628) 0
Net Earnings or (Loss) (25,852) (140,813) (194,139) 0
Per Share Earnings . . (0.00) (0.01) (0.01) 0
or (Loss)
Average Common Shares
14,810,000 11,655,234 13,347,233 1,054,171
Outstanding
</TABLE>
FISCAL YEARS. Our corporation was organized April 9, 1998. Our first fiscal
year ended September 30, 1998, without operations or activity. Our operations
began in October of 1998.
10
<PAGE>
OPERATING EXPENSES
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Six Months Fiscal Years
3/31/00 3/31/99 9/30/99 9/30/98
--------------------------------------------------------------------
Production/Post-. . . . $ 4,949 142,003 174,360 0
Production Expenses
Accounting. . . . . . . 4,963 0 0 0
Legal and Professional. 0 0 30,837 0
Travel. . . . . . . . . 15,940 0 9,199 0
Misc:Bank/Transfer fees 0 110 0 0
Total Expenses. . . . . 25,852 142,113 214,396 0
</TABLE>
SEPTEMBER 30, 1999. During our first fiscal year we focused our efforts
primarily on the production of "Blood Game", as described in Item 1 of this Part
I. During the period from November 1998 to April 1999, we paid substantially all
of the costs of production.
In March of 1999 we began our relationship with Reliant Interactive Media,
as described in Item 1 of this Part I. As of September 30, 1999, we had a total
of $161,782 in unsecured notes receivable from related parties. Three of the
four notes (totaling $46,300) are non-interest bearing and have no specific
payback terms. On March 24, 1999, we provided Reliant Interactive Media
Corporation with funding of $250,000. We received 250,000 shares of Reliant
(restricted) common stock. The investment has been recorded at cost of $250,000.
We owned 4% of Reliant on March 24, 1999.
On May 25, 1999, we loaned Reliant $100,000. As of September 30, 1999,
Reliant had repaid the $100,000 with the agreed upon $3,000 interest increment.
On May 25, 1999, also, we loaned Reliant an additional $200,000. As a part of
that consideration we received an additional 5,000 shares of Reliant common
stock. The investment has been recorded at a cost of $1.00 per share. As of
September 30, 1999, the outstanding principal balance of this loan was $100,000,
plus $15,482 in accrued interest.
As of September 30, 1999, we had a total of $161,782 in notes receivable
from related parties. All of these notes are unsecured. Three of the four notes
(totaling $46,300) are non-interest bearing and have no specific payback terms.
The second loan to Reliant accrues interest at 10% and had, as of September 30,
1999, an unpaid balance of $115,482.
As of September 30, 1999, we had a total of $125,800 in notes payable to
related parties. All of the notes are non-interest bearing and have no specific
payback terms. All the notes are unsecured. A 10% interest rate has been imputed
for these loans, which has been recorded as contributed capital in our financial
statements.
MARCH 31, 2000. The movie was completed in November 1999. The distribution
efforts began in late December 1999 when over sixty preview copies were sent to
distributors accepting this type of genre. The distribution consisted of media
packets containing copies of the film and trailer, a poster on the movie and
stars, and a personalized letter to the individual distributors. The media
packets were received on or around January 10, 2000. There were two responses
that proposed purchasing and/or distributing options, Troma Films and Victory
Multimedia. These negotiations are currently in progress, however, they have
been slow and unassuring of a profitable distribution and/ or purchase
agreement.
11
<PAGE>
During the six months from September 30, 1999 through March 31, 2000, we
incurred minor post-production, accounting, and travel expenses.
SUBSEQUENT EVENTS. Following the six months ended March 31, 2000, we
received a billing from Intrepid International, reflecting an amount unpaid and
deferred expenses of $16,936, of which $8,912 are attorneys fees, and $8,051 are
consulting fees and reimbursement for copying, printing, and freight.
During the most recent six months reported above, our limited liquidity
further decreased significantly.
These expenses shown in the previous discussion are not of a continuing
nature and are not believed by Management to be indicative or predictive of
future periods.
(2) FUTURE PROSPECTS. We continue to hope that Blood Game will be
marketed. We continue to hope that Reliant's last of three infomercial projects
will generate royalty revenues. There is no assurance that either of these hopes
will materialize in the generation of significant revenues, or that the revenues
if generated will result in the achievement of profitability for our
shareholders.
We have no present intention to abandon our business efforts. We are unable
to predict whether or when we might consider it appropriate to participate in a
business combination opportunity. In any case, we could not attract a partner
before we can perfect the continued quotation of our common stock on the OTCBB
by this 1934 Act Registration. Management does not consider a business
combination probable, but discloses it as a foreseeable possibility.
(C) REVERSE ACQUISITION CANDIDATE. We have indicated that we do not plan to
engage in any business combination activity at this time. We have indicated that
such a contingency is foreseeable if we are unable to establish revenues by our
current efforts. Should such a contingency materialize, the acquisition of such
an opportunity could and likely would result in some change in control of the
Issuer at such time. This would likely take the form of a reverse acquisition.
That would mean, in such a case, that we would likely acquire businesses and
assets for stock in an amount that would effectively transfer control of this
corporation to the acquisition target company or ownership group. It is called a
reverse-acquisition because it would be an acquisition by this issuer in form,
but would be an acquisition of this issuer in substance. Capital formation
issues for the future of this Registrant would arise only when targeted business
or assets have been identified. Until such time, this Registrant has no basis
upon which to propose any substantial infusion of capital from sources outside
of its circle of affiliates.
Targeted acquisitions for stock may be accompanied by capital formation
programs, involving knowledgeable investors associated with or contacted by the
owners of a target company. While no such arrangements or plans have been
adopted or are presently under consideration, it would be expected that a
reverse acquisition of a target company or business would be associated with
some private placements and/or limited offerings of common stock of this
Registrant for cash. Such placements, or offerings, if and when made or
extended, would be made with disclosure of and reliance on the businesses and
assets to be acquired, and not upon the present or future condition of this
Issuer without revenues or substantial assets.
12
<PAGE>
ITEM 3. DESCRIPTION OF PROPERTY.
The Issuer has no property and enjoys the non-exclusive use of offices and
telephone of its officers and attorneys.
ITEM 4. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.
(A) SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS. To the best of
Registrant's knowledge and belief the following disclosure presents the total
security ownership of all persons, entities and groups, known to or discoverable
by Registrant, to be the beneficial owner or owners of more than five percent of
any voting class of Registrant's stock. These following 5% or more shareholders
are unrelated to Management or to its sole consultant. Neither management, nor
any affiliate of management, or of the consultant to management, has any
interest in any of the following shareholders, nor do any of the following
shareholders possess any interest or affiliation with either management or its
consultant, except as disclosed in the Notes which follow Tables (a) and (b).
<TABLE>
<CAPTION>
<S> <C> <C>
Beneficial Owners (more than 5%) # Shares % of Total
--------------------------------------------------------
5% Owners
498534 Alberta, Inc. (1) . . . . 1,000,000 6.75
5127 Pineridge
Peachland BC Canada V0H 1Y0
--------------------------------------------------------
Baycove Capital Corporation (2). 1,000,000 6.75
73 Front Street, 3rd Floor
Hamilton, Bermuda HM 12
--------------------------------------------------------
Intrepid International S.A. (3). 5,000,000 33.76
PO Box 8807
Panama 5, Panama
--------------------------------------------------------
Giovanni Trivella. . . . . . . . 5,000,000 33.76
Letzigraben 89
Zurich, Switzerland CH8040
--------------------------------------------------------
Total 5% Owners. . . . . . . . . 12,000,000 81.03
--------------------------------------------------------
Total Issued and Outstanding . . 14,810,000 100.00
--------------------------------------------------------
</TABLE>
(B) SECURITY OWNERSHIP OF MANAGEMENT. To the best of Registrant's knowledge
and belief the following disclosure presents the total beneficial security
ownership of all Directors and Nominees, naming them, and by all Officers and
Directors as a group, without naming them, of Registrant, known to or
discoverable by Registrant. The share ownership disclosed in Table (b) is
attributed ownership. Please see Notes following Table (b).
<TABLE>
<CAPTION>
<S> <C> <C>
Ownership of Management . . . . . . . . . Attributed %
Name and Address of . . . . . . . . . . . Ownership
Beneficial Owner
--------------------------------------------------------------
Kirt W. James President/Director . . . . 5,000,000 33.76
24843 Del Prado Suite 318
Dana Point CA 92629
--------------------------------------------------------------
13
<PAGE>
--------------------------------------------------------------
J. Dan Sifford Jr. Treasurer . . . . . . 5,000,000 33.76
62 Bay Heights Drive
Miami, Florida 33133
--------------------------------------------------------------
Karl E. Rodriguez Secretary. . . . . . . 5,000,000 33.76
24843 Del Prado Suite 318
Dana Point CA 92629
--------------------------------------------------------------
All Officers and Directors as a Group (3) 5,000,000 0.00
--------------------------------------------------------------
Total Shares Issued and Outstanding . . . 14,810,000 100.00
==============================================================
</TABLE>
(1) Mr. Rob Taylor is individual with dispositive control of the shares of
498534 Alberta, Inc.
(2) Ms. Rene Poole is individual with dispositive control of the shares of
Baycove Capital Corporation.
(3) The 5,000,000 Intrepid International shares disclosed in Table (a) are
attributed to our Officers and Directors, as shown in Table (b) because our
officers are affiliates of Intrepid, and their services are provided to us by
Intrepid. For information about Intrepid please see Item 7, Relationships and
Transactions. Mr. James and Mr. Sifford are the persons with dispositive control
of the shares of Intrepid International S.A.
(C) CHANGES IN CONTROL. There are no arrangements known to Registrant,
including any pledge by any persons, of securities of Registrant, which may at a
subsequent date result in a change of control of the Issuer. The Issuer is
searching for a profitable business opportunity. The Issuer is searching for a
profitable business opportunity. The acquisition of such an opportunity could
and likely would result in some change in control of the Issuer at such time.
This would likely take the form of a reverse acquisition. That means that this
issuer would likely acquire businesses and assets for stock in an amount that
would effectively transfer control of this issuer to the acquisition target
company or ownership group. It is called a reverse-acquisition because it would
be an acquisition by this issuer in form, but would be an acquisition of this
issuer in substance.
ITEM 5. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS.
The following persons are the Officers/Directors of Registrant, having
served from inception of our corporation, to continue to serve until their
successors might be elected or appointed. The time of the next meeting of
shareholders has not been determined.
<TABLE>
<CAPTION>
<S> <C> <C>
Executive Officers DIRECTOR'S NAME AGE OFFICE/POSITION
-----------------------------------------------------------------------------
Kirt W. James . . . . . . . . . . . 42 President/Director
24843 Del Prado, Suite 318
Dana Point CA 92629
-----------------------------------------------------------------------------
J. Dan Sifford. . . . . . . . . . . 63 Treasurer/Director
62 Bay Heights Drive
Miami FL 33133
-----------------------------------------------------------------------------
Karl E. Rodriguez . . . . . . . . . 52 General Counsel/
24843 Del Prado, Suite 313. . . . . Corporate Secretary/
Dana Point CA 92629 . . . . . . . . Director
-----------------------------------------------------------------------------
</TABLE>
14
<PAGE>
Kirt W. James, President and Director, has a lifelong background in
marketing and sales. From 1972 to 1987, Mr. James was responsible for sales and
business administrative matters for Glade N. James Sales Co., Inc.; and from
1987 to 1990 Mr. James built retail markets for American International Medical
Supply Co., a Public Company. In 1990 he formed and become President of HJS
Financial Services, Inc., and is responsible for day to day business of the firm
and consults Client's business and Product Development. During the past five
years Mr. James has been involved in the valuation, sale and acquisition of
numerous private businesses and planning for the entry of private corporations
into the public market place for their securities.
J. Dan Sifford, Jr., Treasurer, grew up in Coral Gables, Florida, where he
attended Coral Gables High School and the University of Miami. After leaving the
University of Miami, Mr. Sifford formed a wholesale consumer goods distribution
company which operated throughout the southeastern United States and all of
Latin America. In 1965, as an extension of the operations of the original
company, he founded Indiasa Corporation (Indiasa), a Panamanian company which
was involved in supply and financing arrangements with many of the Latin
American Governments, in particular, their air forces and their national
airlines. As customer requirements dictated, separate subsidiaries were
established to handle specific activities. During each of the past five years he
has served as President of Indiasa, which serves only as a holding company
owning: 100% of Indiasa Aviation Corp. (a company which owns aircraft but has no
operations); 100% of Overseas Aviation Corporation (a company which owns Air
Carrier Certificates but has no operations); 50% of Robmar International, S.A.
(a company operates a manufacturing plant in Argentina and Brazil, but in which
Mr. Sifford holds no office). In addition to his general aviation experience,
Mr. Sifford, an Airline Transport rated pilot, has twenty two years experience
in the airline business, and is currently the President of Airline of the Virgin
Islands, Ltd. a commuter passenger airline operating in the Caribbean, and has
been its president continuously during each of the past five years.
Mr. Sifford is not and has never been a broker-dealer. He has acted
primarily as consultant, and in some cases has served as an interim officer and
director of public companies in their development stage. The following
disclosure identifies those public companies: Air Epicurean, Inc., All American
Aircraft, Earth Industries, DP Charters, Inc., Ecklan Corporation, EditWorks,
Ltd., Market., Market Formulation & Research, Inc., NetAir.com, Inc., NSJ
Mortgage Capital Corporation, Inc., North American Security & Fire, Oasis 4th
Movie Project, Professional Recovery Systems, Inc., Richmond Services, Inc.,
Telecommunications Technologies, Ltd., and World Staffing II, Inc.
Of these last mentioned companies, he is currently serving in this
Registrant, in DP Charters, in Ecklan Corporation, in Oasis 4th Movie Project,
in Richmond Services, Inc, and in NetAir.com, Inc.
Karl E. Rodriguez, Corporate Secretary, General Counsel and Director,
received his Juris Doctor degree in 1972 from Louisiana State University Law
School. He has practiced business and corporate law since 1972, emphasizing
securities and entertainment matters, and has been self-employed in that
capacity for the past five years. He has served as a director of Oasis
Entertainment's Fourth Movie Project, Inc., since April 1998. He is also a
Director, Corporate Secretary, and General Counsel for Reliant Interactive Media
Corp. During his law practice he has also been involved in a variety of dynamic
business experiences. From 1975 to 1982, he was active in real estate
development in the Baton Rouge, Louisiana area. From 1980 until 1985, he
specialized in the sale of businesses and franchises as the owner and operator
of VR Business Brokers. In 1986, he became the Project Manager for Bluffs
Limited Partnership, where he structured the development of an Arnold Palmer
Design Golf Course and in 1992, Mr. Rodriguez was the Managing Director for
MedAmerica, LLC., medicine clinics for children. From 1993 through 1998, he was
the Director, Corporate Secretary and General Counsel for Telco Communications,
Inc., which is a long distance reseller company. From 1992 until 1996, he was
the President of Healthcare Financial and Management Services, Inc., providing
billing services to three Louisiana hospitals. Mr. Rodriguez is also corporate
Secretary and General Counsel to Reliant Interactive Media Corp.
15
<PAGE>
ITEM 6. EXECUTIVE COMPENSATION.
Our Officers devote a minimal amount of time to the affairs of this
corporation and serve without direct compensation by us. Our Officers and
Directors are provided by agreement with Intrepid International and we are
billed on a time-fee basis for such services and time as are expended by them
for us, payable to Intrepid. A previously adopted plan for officers to receive
a percentage of the Registrant's net income has been rescinded.
ITEM 7. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
We have indicated that the services of our officers and directors have been
provided by Intrepid International, and that Intrepid is one of our principal
shareholders and our sole consultant. There are two Intrepid entities, the
Panama parent corporation and its wholly-owned United States operating
subsidiary, incorporated in Nevada. Disclosure is now provided about the
Intrepid entities.
INTREPID INTERNATIONAL, S.A. The officers and directors of Intrepid
International, S. A. (Panama) are comprised of three individuals; Laurencio Jaen
O., Teodoro F. Franco L. and Leopoldo Kennion G. All three of these individuals
are Panamanian citizens and each serves as an officer and a director of Intrepid
International, S. A. (Panama).
Laurencio Jaen O., an original incorporator who has served as President and
Director of the Company since its inception in 1984, resides in Panama City,
Republic of Panama. He is, and has been for the past twenty five years, Vice
President of Indiasa Corporation ("Indiasa"), a Panamanian corporation, which,
through one of its subsidiaries, Robmar International, is involved in the
manufacture and distribution of chemical products in Argentina and Brazil and
which, through its former subsidiary Indiasa Aviation Corporation, was, for
eight years ending in 1981, engaged in aviation consulting, the leasing,
purchase and sale of aircraft, and the operation of a cargo airline, primarily
in Latin America. Mr. Jaen was a founder of PAISA, Panama's international
airline, served as president of the Colon Free Zone (the world s largest free
trade zone), and as Director of Panama's Social Security Administration. He has
also served as the President of the Panamanian Chamber of Commerce, and as a
member of the Board of Presidential Advisors of the Republic of Panama.
Teodoro F. Franco L., Secretary and a Director of the Company, has, for
thirty years, been a specialist in maritime and aviation law. Mr. Franco is a
partner in Franco and Franco, one of the most prestigious law firms in Panama
with offices around the world. In addition to his law practice he has served as
Panamanian Consul to Liverpool, England and for the past five years as
Ambassador to Great Britain. The firm practices maritime, aviation and
commercial law and currently is the legal firm for: IBERIA (the Spanish national
airline), KLM (the Dutch national airline), VIASA (the Venezuelan national
airline), Aeroflot (the Russian national airline) and various smaller Latin
American national airlines as well as being the registered agents for thousands
of ocean going ships around the world flying the Panamanian flag. Mr. Franco
brings to the Company a wealth of international legal, commercial and diplomatic
experience.
Leopoldo Kennion G., Treasurer and a Director of the Company, is, and has
for twenty years, been a Certified Public Accountant specializing in
international accounting and is an associate in the law firm of Franco and
Franco. Mr. Kennion practices maritime, aviation and commercial accounting
serving the specialized needs of the transnational clients of Franco and Franco
by providing an interface between them and their auditors.
J. Dan Sifford, Jr., is the United States Managing Director for Intrepid
International, S.A. (Panama). He is fluent in the Spanish Language. His
biographical information is found below.
16
<PAGE>
INTREPID INTERNATIONAL, LTD. The officers and directors of Intrepid
International, Ltd. (Nevada) are comprised of two individuals; Kirt W. James,
and J. Dan Sifford, Jr. They are both our officers and directors, and their
biographies are found in Item 5 of this Part I.
ITEM 8. DESCRIPTION OF SECURITIES.
THE REGISTRANT'S CAPITAL AUTHORIZED AND ISSUED. The Registrant is authorized to
issue 100,000,000 shares of a single class of Common Voting Stock, of par value
$0.001, of which 14,810,000 are issued and outstanding as of December 31, 1999.
COMMON STOCK. All shares of Common Stock when issued were fully paid for and
nonassessable. Each holder of Common Stock is entitled to one vote per share on
all matters submitted for action by the stockholders. All shares of Common Stock
are equal to each other with respect to the election of directors and cumulative
voting is not permitted; therefore, the holders of more than 50% of the
outstanding Common Stock can, if they choose to do so, elect all of the
directors. The terms of the directors are not staggered. Directors are elected
annually to serve until the next annual meeting of shareholders and until their
successor is elected and qualified. There are no preemptive rights to purchase
any additional Common Stock or other securities of the Registrant. The owners of
a majority of the common stock may also take any action without prior notice or
meeting which a majority of shareholders could have taken at a regularly called
shareholders meeting, giving notice to all shareholders thereafter of the action
taken. In the event of liquidation or dissolution, holders of Common Stock are
entitled to receive, pro rata, the assets remaining, after creditors, and
holders of any class of stock having liquidation rights senior to holders of
shares of Common Stock, have been paid in full. All shares of Common Stock enjoy
equal dividend rights. There are no provisions in the Articles of Incorporation
or By-Laws which would delay, defer or prevent a change of control.
SECONDARY TRADING refers to the marketability to resell the securities of this
Registrant in brokerage transactions, and that marketability is generally
governed by Rule 144, promulgated by the Securities and Exchange Commission
pursuant to 3 of the Securities Act of 1933. Securities which have not been
registered pursuant to the Securities Act of 1933, but were exempt from such
registration when issued, are generally Restricted Securities as defined by
Rule 144(a). The impact of the restrictions of Rule 144 are (a) a basic one year
holding period from purchase; and (b) a limitation of the amount any shareholder
may sell during the second year, as to non-affiliates of the Registrant;
however, as to shares owned by affiliates of the Registrant, the second-year
limitation of amounts attaches and continues indefinitely, at least until such
person has ceased to be an affiliate for 90 days or more. The limitation of
amounts is generally 1% of the total issued and outstanding in any 90 day
period.
UNRESTRICTED SHARES OF COMMON STOCK. 14,810,000 shares of common stock are
issued and outstanding, of which 10,000,000 shares are held by affiliates of the
Registrant, and of which 4,810,000 shares are owned by non-affiliates of the
Registrant and are believed to be restricted securities which could be sold in
brokerage transactions in compliance with Rule 144. 1,500,000 of these 4,810,000
shares were issued pursuant to Regulation A, adopted under Section 3(b) of the
Securities Act of 1933, on or about September 30, 1998 and the balance were
issued on or about April 20, 1999, and were when issued Restricted Securities,
as defined by Rule 144(a). The affiliate shares were issued on or about April 9,
1998, pursuant to 4(2) of the 1933 Act, and on April 9, 2000 will be more than
two years old. Rule 144 would permit affiliate sales in limited amounts, as
discussed in the previous paragraph. Sales in amount limited by Rule 144 are
commonly called "dribbling."
OPTIONS AND DERIVATIVE SECURITIES. There are no outstanding options or
derivative securities of this Registrant. There are no shares issued or reserved
which are subject to options or warrants to purchase, or securities convertible
into common stock of this Registrant.
17
<PAGE>
RISKS OF "PENNY STOCK." The Registrant's common stock may be deemed to be "penny
stock" as that term is defined in Reg.Section 240.3a51-1 of the Securities and
Exchange Commission. Penny stock share stocks (i) with a price of less than five
dollars per share; (ii) that are not traded on a "recognized" national exchange;
(iii) whose prices are not quoted on the NASDAQ automated quotation system
(NASDAQ) listed stocks must still meet requirement (i) above); or (iv) in
issuers with net tangible assets less than $2,000,000 (if the issuer has been in
continuous operation for at least three years) or $5,000,000 (if in continuous
operation for less than three years), or with average revenues of less than
$6,000,000 for the last three years.
Section 15(g) of the Securities Exchange Act of 1934, as amended, and Reg.
Section 240.15g-2 of the Securities and Exchange Commission require broker
dealers dealing in penny stocks to provide potential investors with a document
disclosing the risks of penny stocks and to obtain a manually signed and dated
written receipt of the document before effecting any transaction in a penny
stock for the investor's account. Potential investors in the Company's common
stock are urged to obtain and read such disclosure carefully before purchasing
any shares that are deemed to be "penny stock."
Moreover, Reg. Section 240.15g-9 of the Securities and Exchange Commission
requires broker dealers in penny stocks to approve the account of any investor
for transactions in such stocks before selling any penny stock to that investor.
This procedure requires the broker dealer to (i) obtain from the investor
information concerning his or her financial situation, investment experience and
investment objectives; (ii) reasonably determine, based on that information,
that transactions in penny stocks are suitable for the investor and that the
investor has sufficient knowledge and experience as to be reasonably capable of
evaluating the risks of penny stock transactions; (iii) provide the investor
with a written statement setting forth the basis on which the broker -dealer
made the determination in (ii) above; and (iv) receive a signed and dated copy
of such statement from the investor, confirming that it accurately reflects the
investor's financial situation, investment experience and investment objectives.
Compliance with these requirements may make it more difficult for investors in
the Company's common stock to resell their shares to third parties or to
otherwise dispose of them.
RISKS OF STATE BLUE SKY LAWS. In addition to other risks, restrictions and
limitations which may affect the resale of the existing shares of the common
stock of this Registrant, consideration must be given to the Blue Sky laws and
regulations of each State or jurisdiction in which a shareholder wishing to
re-sell may reside. This Registrant has taken no action to register or qualify
its common stock for resale pursuant to the Blue Sky laws or regulations of
any State or jurisdiction. Accordingly offers to buy or sell the existing
securities of this Registrant may be unlawful in certain States. Additionally,
some States may have laws or regulation limiting the offer, sale or resale of
securities of companies with no business or effective business plan. In the
event of the contingency in which we might become such a company by abandoning
our business or spinning off our business and assets, substantial limitations on
transactions in our common stock may become applicable.
the remainder of this page left intentionally blank
18
<PAGE>
--------------------------------------------------------------------------------
PART II
--------------------------------------------------------------------------------
ITEM 1.
MARKET PRICE OF AND DIVIDENDS ON REGISTRANT'S COMMON EQUITY
AND SHAREHOLDER MATTERS.
(A) MARKET INFORMATION. The Common Stock of this Issuer is not quoted on any
trading exchange.
The Common Stock of this Registrant was cleared for quotation Over the Counter
in the Pink Sheets, only recently. To the best of the Registrant's knowledge and
belief, there has been no market activity, buying or selling, of the common
stock of this Registrant, in brokerage transactions.
(B) HOLDERS. There are presently approximately 42 shareholders of the common
stock of this Registrant.
(C) DIVIDENDS. No cash dividends have been paid by the Company on its Common
Stock or other Stock and no such payment is anticipated in the foreseeable
future.
(D) REVERSE ACQUISITIONS. A reverse acquisition of a target business or
company would be expected to involve a change of control of the Registrant, and
the designation of new management. The financial statements of this Registrant
would become largely unreflective of the true condition of the Registrant after
such an acquisition. Shareholder approval would be solicited, pursuant to the
laws of the State of Nevada, to approve the acquisition, change of control, and
any material corporate changes incidental to the reorganization of this
Registrant. In connection with the solicitation of shareholder approval, whether
or not proxies are solicited, the Registrant would provide shareholders with the
fullest possible disclosure of all information material to shareholder
consideration, and such disclosure would include audited financial statements of
the target entity, if available. If shareholder approval is sought in advance of
audited financial statements of an acquisition target, the authority of
management to consummate any transaction would be contingent on a proper audit
of the target meeting the criteria of any un-audited information relied upon by
shareholders.
ITEM 2. LEGAL PROCEEDINGS.
There are no proceedings, legal, enforcement or administrative, pending,
threatened or anticipated involving or affecting this Registrant.
ITEM 3. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS.
There have been no disagreements of any sort or kind with Auditors or
Accountants respecting any matter or item reflected in the financial statements
of this Registrant.
19
<PAGE>
ITEM 4. RECENT SALES OF UNREGISTERED SECURITIES.
The following disclosure presents:
(a) The date, title and amount of securities sold within the past three years.
(b) Principal Underwriters, if any. If the small business issuer did not
publicly offer any securities, identify the persons or class of persons to whom
the small business issuer sold the securities.
No Underwriters or Underwriting. No discounts or commissions.
(c) For securities sold for cash, the total offering price and the total
underwriting discounts or commissions. For securities sold other than for cash,
describe the transaction and the type and amount of consideration received by
the small business issuer.
(d) The Section of the Securities Act or the rule of the Commission under which
the small business issuer claimed exemption from registration and the facts
relied upon to make the exemption available.
(e) If the securities sold are convertible or exchangeable into equity
securities, or are warrants or options representing equity securities, disclose
the terms of conversion or exercise of the securities.
On April 9, 1998, we made our initial issuance of 10,000,000 shares of
common stock, and recorded at predecessor cost of $-0-, pursuant to Section 4(2)
of the Securities Act of 1933. The prices was $0.001 per share. The shares were
issued 5,000,000 each to each of our two founders: Intrepid International S.A.
and Giovanni Trivella. Both of our founders were known to us to be accredited
investor/founders, and both were afforded and had full access to our corporate
condition and affairs, of the kind of information which registration would have
disclosed, at their time of their investment and founding of our corporation.
During the period from September 30, 1998 to April 22, 1999 we sold 481,000
shares of our common stock, pursuant to Regulation A, promulgated by the
Commission under authority of Section 3(b) of the Securities Act of 1933. There
were 41 subscribers. The price was $0.10 per shares. The purchasers were each
individually determined by us to be accredited investors, based upon their
experience in investments of this speculative nature, and by their respective
incomes and net worth.
ITEM 5. INDEMNIFICATION OF OFFICERS AND DIRECTORS.
There is no provision in the Articles of Incorporation, now the By-Laws of
the Corporation, nor any Resolution of the Board of Directors, providing for
indemnification of Officers or Directors. The Registrant is aware of no
provision of Nevada Corporate Law which creates or imposes any provision for
indemnity of Officers or Directors.
the remainder of this page left intentionally blank
20
<PAGE>
--------------------------------------------------------------------------------
PART F/S
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
AUDITED FINANCIAL STATEMENTS: for the fiscal years ended September 30, 1999
and 1998, are provided as Financial Statement: Attachment F-1, in the body of
filing this filing, following this page, and incorporated herein by this
reference as though fully set forth on this page as well.
--------------------------------------------------------------------------------
UN-AUDITED FINANCIAL STATEMENTS: for the six months ended March 31, 2000
are provided as Financial Statement: Attachment F-2, in the body of this
filings, following F-1, and incorporated herein by this reference as though
fully set forth on this page as well.
--------------------------------------------------------------------------------
SELECTED FINANCIAL INFORMATION
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
3/31/00 3/31/99 9/30/99 9/30/98
----------------------------------------------------------------------------
Total Assets . . . . . $ 490 $ 3,151 $ 258,151 $ 150,000
Revenues . . . . . . . 0 0 0 0
Operating Expenses . . 25,852 142,113 214,396 0
Interest Income. . . . 0 1,300 24,885 0
Interest (Expense) . . 0 0 (4,628) 0
Net Earnings or (Loss) (25,852) (140,813) (194,139) 0
Per Share Earnings . . 0.00) (0.01) (0.01) 0
or (Loss)
Average Common Shares. 14,810,000 11,655,234 13,347,233 1,054,171
Outstanding
----------------------------------------------------------------------------
</TABLE>
--------------------------------------------------------------------------------
FINANCIAL STATEMENTS PAGE
F-1 Audited Financial Statements: September 30, 1999 and 1998 22
F-2 Unaudited Financial Statements: December 15, 1999 33
--------------------------------------------------------------------------------
21
<PAGE>
--------------------------------------------------------------------------------
F-1
AUDITED FINANCIAL STATEMENTS: SEPTEMBER 30, 1999 AND 1998
--------------------------------------------------------------------------------
22
<PAGE>
OASIS ENTERTAINMENT'S FOURTH
MOVIE PROJECT, INC.
(A Development Stage Company)
FINANCIAL STATEMENTS
September 30, 1999
23
<PAGE>
CONTENTS
Independent Auditors' Report
Balance Sheet
Statements of Operations
Statements of Stockholders' Equity
Statements of Cash Flows
Notes to the Financial Statements.
24
<PAGE>
INDEPENDENT AUDITORS' REPORT
To the Board of Directors
Oasis Entertainment's Fourth Movie Project, Inc.
(A Development Stage Company)
Dana Point, California
We have audited the accompanying balance sheet of Oasis Entertainment's Fourth
Movie Project, Inc. (a development stage company) as of September 30, 1999, and
the related statements of operations, stockholders' equity and cash flows from
inception on April 9, 1998 through September 30, 1998 and 1999 and for the year
ended September 30, 1999. These financial statements are the responsibility of
the Company's management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audits to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Oasis Entertainment's Fourth
Movie Project, Inc. (a development stage company) as of September 30, 1999 and
the results of its operations and its cash flows from inception on April 9, 1998
through September 30, 1998 and 1999 and for the year ended September 30, 1999 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 2 to the
financial statements, the Company has had limited operations and no operating
revenues which together raise substantial doubt about its ability to continue as
a going concern. Management's plans in regard to these matters are also
discussed in Note 2. The financial statements do not include any adjustments
that might result from the outcome of this uncertainty.
/s/
Jones, Jensen & Company
Salt Lake City, Utah
November 30, 1999
25
<PAGE>
OASIS ENTERTAINMENT'S FOURTH MOVIE PROJECT, INC.
(A Development Stage Company)
Balance Sheet
ASSETS
September 30,
1999
--------------------------------------------------------------------------------
CURRENT ASSETS
Cash and cash equivalents $ 3,151
----------
Total Current Assets 3,151
----------
OTHER ASSETS
Investments (Note 4) 255,000
----------
Total Long-Term Assets 255,000
----------
TOTAL ASSETS $ 258,151
==========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable $ 2,644
Notes payable - related parties (Note 6) 125,800
----------
Total Current Liabilities 128,444
----------
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY
Common stock; 100,000,000 shares authorized of $0.001
par value, 14,810,000 shares issued and outstanding 14,810
Additional paid-in capital 470,818
Notes receivable - related parties (Note 5) (161,782)
Deficit accumulated during the development stage (194,139)
----------
Total Stockholders' Equity 129,707
----------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $258,151
==========
The accompanying notes are an integral part of these financial statements.
26
<PAGE>
OASIS ENTERTAINMENT'S FOURTH MOVIE PROJECT, INC.
(A Development Stage Company)
Statements of Operations
For the From Inception on
Year Ended April 9, 1998 Through
September 30, September 30,
---------------------------
1999 1998 1999
------------ ------------ ------------
REVENUES $ 0 $ 0 $ 0
------------ ------------ ------------
EXPENSES
General and administrative 214,396 0 214,396
------------ ------------ ------------
Total Expenses 214,396 0 214,396
------------ ------------ ------------
NET LOSS BEFORE OTHER INCOME
(EXPENSE) (214,396) 0 (214,396)
------------ ------------ ------------
OTHER INCOME (EXPENSE)
Interest expense (4,628) 0 (4,628)
Interest income 24,885 0 24,885
------------ ------------ ------------
Total Other Income (Expense) 20,257 0 20,257
NET LOSS $ (194,139) $ 0 $ (194,139)
============ ============ ============
BASIC LOSS PER SHARE $ (0.01) $ 0
============ ============
WEIGHTED AVERAGE NUMBER
OF SHARES OUTSTANDING 14,393,116 1,054,171
============ ============
The accompanying notes are an integral part of these financial statements.
27
<PAGE>
OASIS ENTERTAINMENT'S FOURTH MOVIE PROJECT, INC.
(A Development Stage Company)
Statements of Stockholders' Equity
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Deficit
Accumulated
Additional During the
Common Stock Paid-In Development
Shares Amount Capital Stage
Balance at inception on
April 9, 1998. . . . . . . . 0 $ 0 $ 0 $ 0
Common Stock issued to
founders recorded at
predecessor cost of $0.00. . 10,000,000 10,000 (10,000) 0
Common stock issued for
cash at $0.10 per share. . . 1,500,000 1,500 148,500 0
Net loss from inception on
April 9, 1998 through
September 30, 1998 . . . . . 0 0 0 0
Balance September 30, 1998 . 11,500,000 11,500 138,500 0
Common stock issued for cash
at $0.10 per share . . . . . 3,310,000 3,310 327,690 0
Accrued interest on notes to
related parties recorded as
contributed capital. . . . . 0 0 4,628 0
Net loss for the year ended
September 30, 1999 . . . . . 0 0 0 (194,139)
Balance, September 30, 1999. 14,810,000 $ 14,810 $ 470,818 ($194,139)
</TABLE>
The accompanying notes are an integral part of these financial statements.
28
<PAGE>
OASIS ENTERTAINMENT'S FOURTH MOVIE PROJECT, INC.
(A Development Stage Company)
Statements of Cash Flows
<TABLE>
<CAPTION>
<S> <C> <C> <C>
For the From Inception on
Year Ended April 9, 1998 Through
September 30, September 30,
1999 1998 1999
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss . . . . . . . . . . . . . . . . . . . . . . . ($194,139) $ 0 ($194,139)
Changes in assets and liabilities:
(increase) in interest receivable. . . . . . . . . . . (15,482) 0 (15,482)
Increase in accounts payable . . . . . . . . . . . . . 2,644 0 2,644
Net Cash (Used) by Operating Activities. . . . . . . . (206,977) 0 (206,977)
CASH FLOWS FROM INVESTING ACTIVITES
Cash Paid for investments. . . . . . . . . . . . . . . (255,000) 0 (255,000)
Net Cash (Used) by Investing Activites . . . . . . . . (255,000) 0 (255,000)
--------------- --------------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds paid on notes receivable-related parties. . . (246,300) 0 (246,300)
Principal received on notes receivable-related parties 100,000 0 100,000
Proceeds received on notes payable-related party . . . 125,800 0 125,800
Common Stock issued for cash . . . . . . . . . . . . . 481,000 0 481,000
Contributed capital. . . . . . . . . . . . . . . . . . 4,628 0 4,628
Net Cash Provided by Financing Activities. . . . . . . 465,128 0 465,128
NET INCREASE IN CASH . . . . . . . . . . . . . . . . . 3,151 0 3,151
CASH AT BEGINNING OF PERIOD. . . . . . . . . . . . . . 0 0 0
CASH AT END OF PERIOD. . . . . . . . . . . . . . . . . $ 3,151 $ 0 $ 3,151
SUPPLEMENTAL CASH FLOW INFORMATION
CASH PAID FOR:
Interest . . . . . . . . . . . . . . . . . . . . . . . $ 0 $ 0 $ 0
Income taxes . . . . . . . . . . . . . . . . . . . . . $ 0 $ 0 $ 0
</TABLE>
The accompanying notes are an integral part of these financial statements.
29
<PAGE>
OASIS ENTERTAINMENT'S FOURTH MOVIE PROJECT, INC.
(A Development Stage Company)
Notes to the Financial Statements
September 30, 1999
NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
a. Organization
Oasis Entertainment's Fourth Movie Project, Inc. (the Company) was
incorporated on April 9, 1998 under the laws of the State of Nevada,
primarily for the purpose of producing film and video for theatrical,
cable and televised releases.
The Company has limited operations, assets and liabilities.
Accordingly, the Company is dependent upon management and/or
significant shareholders to provide sufficient working capital to
preserve the integrity of the corporate entity during this phase. It
is the intent of management and significant shareholders to provide
sufficient working capital necessary to support and preserve the
integrity of the corporate entity.
b. Accounting Method
The Company's financial statements are prepared using the accrual
method of accounting. The Company has elected a September 30 year end.
c. Cash and Cash Equivalents
Cash equivalents include short-term, highly liquid investments with
maturities of three months or less at the time of acquisition.
d. Basic Loss Per Share
The computation of basic loss per share of common stock is based on
the weighted average number of shares outstanding during the period of
financial statements.
e. Provision for Taxes
At September 30, 1999, the Company had net operating loss
carryforwards of approximately $194,000 that may be offset against
future taxable income through 2014. No tax benefit has been reported
in the financial statements, because the Company believes there is a
50% or greater chance the carryforwards will expire unused.
Accordingly, the potential tax benefits of the loss carryforwards are
offset by a valuation amount of the same amount.
f. Additional Accounting Policies
Additional accounting policies will be established once planned
principal operations commence.
30
<PAGE>
OASIS ENTERTAINMENT'S FOURTH MOVIE PROJECT, INC.
(A Development Stage Company)
Notes to the Financial Statements
September 30, 1999
NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(Continued)
g. 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.
NOTE 2 - GOING CONCERN
The Company's financial statements are prepared using generally
accepted accounting principles applicable to a going concern which
contemplates the realization of assets and liquidation of liabilities
in the normal course of business. However, the Company does not have
significant cash or other material assets, nor does it have an
established source of revenues sufficient to cover its operating costs
and to allow it to continue as a going concern. It is the intent of
the Company to produce and earn revenues from the sale of "B genre"
movies. Until this occurs, shareholders of the Company have committed
to meeting the Company's operating expenses.
NOTE 3 - ROYALTY AGREEMENT - RELATED PARTY
On March 24, 1999, the Company entered into an agreement with Reliant
Interactive Media Corporation ("Reliant"), a shareholder of the
Company, under which the Company committed to provide funding for
three "infomercials" Reliant was to produce. Under the terms of this
agreement, the Company provided a total of $250,000 for this purpose.
As consideration for this funding, Reliant was to issue 250,000
restricted, post-split shares of its common stock to the Company (see
Note 4). Also, Reliant agreed to pay the Company a royalty equal to
two percent of the adjusted gross revenues created by the infomercials
until the Company had received $625,000. The royalty would be reduced
to one percent of the revenues thereafter.
As of September 30, 1999, Reliant had produced only two of the three
infomercials. Both were unprofitable, and produced no royalties for
the Company. The third infomercial is expected to be produced in early
2000.
31
<PAGE>
OASIS ENTERTAINMENT'S FOURTH MOVIE PROJECT, INC.
(A Development Stage Company)
Notes to the Financial Statements
September 30, 1999
NOTE 4 - INVESTMENT
On March 24, 1999, the Company entered into an agreement with Reliant
Interactive Media Corporation ("Reliant") under which the Company provided
funding of $250,000 to Reliant (see Note 3). As consideration for this funding,
Reliant contracted to issue 250,000 restricted, post- split shares of its common
stock to the Company upon completion of the funding. The investment has been
recorded at its cost of $250,000.
On May 25, 1999, the Company entered into another agreement with Reliant
under which the Company loaned $200,000 to Reliant. As part of the consideration
for this loan, Reliant agreed to issue 5,000 shares of its restricted common
stock to the Company. The investment has been recorded at a cost of $1.00 per
share, based on the determination of the previous agreement.
NOTE 5 - NOTES RECEIVABLE - RELATED PARTIES
As of September 30, 1999, the Company had a total of $161,782 in notes
receivable from related parties. All of the notes are unsecured. Three of the
four notes (totaling $46,300) are non-interest bearing and have no specific
payback terms. The fourth note, totaling $115,482 is receivable from Reliant
Interactive Media Corp (see Note 3) and bears a ten percent (10%) interest rate.
NOTE 6 - NOTES PAYABLE - RELATED PARTIES
As of September 30, 1999, the Company had a total of $125,800 in notes
payable to related parties. All of the notes are non-interest bearing, and have
no specific payback terms. All the notes are unsecured. A 10% interest rate has
been imputed for these loans, which has been recorded as contributed capital in
the financial statements.
32
<PAGE>
--------------------------------------------------------------------------------
F-2
UNAUDITED FINANCIAL STATEMENTS: MARCH 31, 2000
--------------------------------------------------------------------------------
33
<PAGE>
OASIS ENTERTAINMENT'S FORTH MOVIE PROJECT, INC.
BALANCE SHEET (UNAUDITED)
For the fiscal years ended September 30, 1998 and 1999
And the six months ended March 31, 2000
<TABLE>
<CAPTION>
<S> <C> <C> <C>
March 31, September 30,
---------------
2000 1999 1998
----------- --------------- --------
ASSETS
CURRENT ASSETS
Cash $ 490 $ 3,151 $150,000
----------- --------------- --------
TOTAL CURRENT ASSETS 490 3,151 150,000
OTHER ASSETS
Investments 255,000 255,000 0
----------- --------------- --------
TOTAL OTHER ASSETS 255,000 255,000 0
TOTAL ASSETS 255,490 258,151 150,000
=========== =============== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES
Accounts payable 2,644 2,644 0
Notes payable - related parties 148,991 125,800 0
----------- ---------------
TOTAL LIABILITIES 151,635 128,444 0
STOCKHOLDERS' EQUITY
Common Stock, $.001 par value; authorized 100,000,000
shares; issued and outstanding, 11,500,000 shares,
14,810,000 shares and 14,810,000 shares respectively 14,810 14,810 11,500
Additional Paid-In Capital 470,818 470,818 138,500
Notes receivable - related parties (161,782) (161,782) 0
Accumulated Equity (Deficit) (219,991) (194,139) 0
----------- --------------- --------
Total Stockholders' Equity 103,855 129,707 150,000
----------- --------------- --------
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY $ 255,490 $ 258,151 $150,000
=========== =============== ========
</TABLE>
The accompanying notes are an integral part of the financial statements.
34
<PAGE>
OASIS ENTERTAINMENT'S FORTH MOVIE PROJECT, INC.
STATEMENTS OF OPERATIONS (UNAUDITED)
For the fiscal years ended September 30, 1998 and 1999
And the six months ended March 31, 2000
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
For the six For the April 9,1998
months ended Year ended through
March 31, September 30, March 31,
-------------
2000 1999 1999 1999
------------- ----------- -------------- -------------
Revenues -0- -0- -0- -0-
------------- ----------- -------------- -------------
General and administrative 25,852 142,113 214,396 240,248
------------- ----------- -------------- -------------
Total expenses 25,852 142,113 214,396 240,248
Net Income (Loss) ($25,852) ($142,113) ($214,396) ($240,248)
============= =========== ============== =============
Other income (expense)
Interest expense 0 0 (4,628) (4,628)
Interest income 0 1,300 24,885 26,185
----------- -------------- -------------
Net Loss (25,852) (140,813) (194,139) (218,691)
Loss per Share ($0.0017) ($0.0121) ($0.0135) ($0.0165)
============= =========== ============== =============
Weighted Average
Shares Outstanding 14,810,000 11,655,234 14,393,116 13,232,617
============= =========== ============== =============
</TABLE>
The accompanying notes are an integral part of the financial statements.
35
<PAGE>
OASIS ENTERTAINMENT'S FORTH MOVIE PROJECT, INC.
STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)(UNAUDITED)
For the period from inception of the Development Stage
On April 9, 1998, through September 30, 1998, for September 30, 1999
And the six months ended March 31, 2000
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
Additional Accumulated Total Stock-
Common Par Paid-In Equity holders' Equity
Stock Value Capital (Deficit) (Deficit)
---------- ---------- ------------ -------------- -----------------
Common Stock issued at inception 10,000,000 $ 10,000 ($10,000) $ 0 $ 0
Common Stock issued for
cash at $0.10 per share 1,500,000 1,500 148,500 0 0
Net loss during period 0 0 0 0 0
---------- ---------- ------------ -------------- -----------------
Balances at September 30, 1998 11,500,000 11,500 138,500 0 150,000
Common Stock issued for
cash at $0.10 per share 3,310,000 3,310 327,690 0 0
Accrued interest on notes to related
parties recorded as contributed capital 0 0 4,628 0 0
Net Loss for the period 0 0 0 (194,139) 0
Balances at September 30, 1999 14,810,000 $ 14,810 $ 470,818 ($194,139) $ 291,489
Net Loss for the period 0 0 0 (25,852) 0
Balances at March 31, 2000 14,810,000 $14,810.00 $470,818 ($219,991) $ 265,637
</TABLE>
The accompanying notes are an integral part of the financial statements.
36
<PAGE>
OASIS ENTERTAINMENT'S FORTH MOVIE PROJECT, INC.
STATEMENTS OF CASH FLOW (UNAUDITED)
For the fiscal years ended September 30, 1998 and 1999
And the six months ended March 31, 2000
<TABLE>
<CAPTION>
<S> <C> <C> <C>
From inception on
For the six April 9,1998
months ended through
March 31, March 31,
-------------
2000 1999 2000
--------- ------------- ------------------
Operating Activities
Net Income (Loss) ($25,852) ($140,813) ($219,991)
(Increase) in interest receivable 0 0 (15,482)
Increase in accounts payable 0 25,000 3,644
--------- ------------- ------------------
Net Cash from Operations (25,852) (115,813) (231,829)
Cash flows from investing activities
Cash paid for investments 0 (125,000) (255,000)
Net cash (used) by investing activities 0 (125,000) (255,000)
--------- ------------- ------------------
Cash flows from financing activities
Proceeds paid on notes receivable - related parties 0 0 (246,300)
Principal received on notes receivable - related parties 0 221,000 100,000
Proceeds received on notes payable - related parties 13,295 25,000 139,095
Common stock issued for cash 0 0 481,000
Contributed capital 0 0 4,628
--------- ------------- ------------------
Net cash provided by financing activities 13,295 246,000 478,423
Net increase (decrease) in Cash (12,557) 5,187 490
Cash at beginning of period 13,047 -0- -0-
Cash as of Statement Date 490 5,187 490
========= ============= ==================
</TABLE>
The accompanying notes are an integral part of the financial statements.
37
<PAGE>
OASIS ENTERTAINMENT'S FOURTH MOVIE PROJECT, INC.
(A Development Stage Company)
Notes to the Financial Statements
March 31, 2000
NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
a. Organization
Oasis Entertainment's Fourth Movie Project, Inc. (the Company) was incorporated
on April 9, 1998 under the laws of the State of Nevada, primarily for the
purpose of producing film and video for theatrical, cable and televised
releases.
The Company has limited operations, assets and liabilities. Accordingly, the
Company is dependent upon management and/or significant shareholders to provide
sufficient working capital to preserve the integrity of the corporate entity
during this phase. It is the intent of management and significant shareholders
to provide sufficient working capital necessary to support and preserve the
integrity of the corporate entity.
b. Accounting Method
The Company's financial statements are prepared using the accrual method of
accounting. The Company has elected a September 30 year end.
c. Cash and Cash Equivalents
Cash equivalents include short-term, highly liquid investments with maturities
of three months or less at the time of acquisition.
d. Basic Loss Per Share
The computation of basic loss per share of common stock is based on the weighted
average number of shares outstanding during the period of financial statements.
e. Provision for Taxes
At March 31, 2000, the Company had net operating loss carryforwards of
approximately $220,000 that may be offset against future taxable income through
2014. No tax benefit has been reported in the financial statements, because the
Company believes there is a 50% or greater chance the carryforwards will expire
unused. Accordingly, the potential tax benefits of the loss carryforwards are
offset by a valuation amount of the same amount.
f. Additional Accounting Policies
Additional accounting policies will be established once planned principal
operations commence.
38
<PAGE>
OASIS ENTERTAINMENT'S FOURTH MOVIE PROJECT, INC.
(A Development Stage Company)
Notes to the Financial Statements
March 31, 2000
NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(Continued)
g. 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.
NOTE 2 - GOING- CONCERN
The Company's financial statements are prepared using generally accepted
accounting principles applicable to a going concern which contemplates the
realization of assets and liquidation of liabilities in the normal course of
business. However, the Company does not have significant cash or other material
assets, nor does it have an established source of revenues sufficient to cover
its operating costs and to allow it to continue as a going concern. It is the
intent of the Company to produce and earn revenues from the sale of 'B genre'
movies. Until this occurs, shareholders of the Company have committed to
meeting the Company's operating expenses.
NOTE 3 - ROYALTY AGREEMENT - RELATED PARTY
On March 24, 1999, the Company entered into an agreement with Reliant
Interactive Media Corporation ("Reliant"), a shareholder of the Company, under
which the Company committed to provide funding for three "infomercials' Reliant
was to produce. Under the terms of this agreement, the Company provided a total
of $250,000 for this purpose. As consideration for this funding, Reliant was to
issue 250,000 restricted, post-split shares of its common stock to the Company
(see Note 4). Also, Reliant agreed to pay the Company a royalty equal to two
percent of the adjusted gross revenues created by the infomercials until the
Company had received $625,000. The royalty would be reduced to one percent of
the revenues thereafter.
As of March 31, 2000, Reliant had produced only two of the three infomercials.
Both were unprofitable, and produced no royalties for the Company. The third
infomercial is expected to be produced in early 2000.
39
<PAGE>
OASIS ENTERTAINMENT'S FOURTH MOVIE PROJECT, INC.
(A Development Stage Company)
Notes to the Financial Statements
March 31, 2000
NOTE 4 - INVESTMENT
On March 24, 1999, the Company entered into an agreement with Reliant
Interactive Media Corporation ("Reliant") under which the Company provided
funding of $250,000 to Reliant (see Note 3). As consideration for this funding,
Reliant contracted to issue 250,000 restricted, post-split shares of its common
stock to the Company upon completion of the funding. The investment has been
recorded at its cost of $250,000.
On May 25, 1999, the Company entered into another agreement with Reliant under
which the Company loaned $200,000 to Reliant. As part of the consideration for
this loan, Reliant agreed to issue 5,000 shares of its restricted common stock
to the Company. The investment has been recorded at a cost of $1.00 per share,
based on the determination of the previous agreement.
NOTE 5 - NOTES RECEIVABLE - RELATED PARTIES
As of March 31, 2000, the Company had a total of $161,782 in notes receivable
from related parties. All of the notes are unsecured. Three of the four notes
(totaling $46,300) are non-interest bearing and have no specific payback terms.
The fourth note, totaling $115,482 is receivable from Reliant Interactive Media
Corp (see Note 3) and bears a ten percent (10%) interest rate.
NOTE 6 - NOTES PAYABLE - RELATED PARTIES
As of March 31, 2000, the Company had a total of $148,991 in notes payable to
related parties. All of the notes are non-interest bearing, and have no
specific payback terms. All the notes are unsecured. A 10% interest rate has
been imputed for these loans, which has been recorded as contributed capital in
the financial statements.
40
<PAGE>
--------------------------------------------------------------------------------
PART III
--------------------------------------------------------------------------------
ITEM 1. INDEX TO EXHIBITS.
Exhibit Index
Exhibit
Table
# Table Category / Description of Exhibit Page Number
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[3] ARTICLES/CERTIFICATES OF INCORPORATION, AND BY-LAWS
3.1 Articles of Incorporation 46
3.2 By-Laws 49
[10] ARTICLES/CERTIFICATES OF INCORPORATION, AND BY-LAWS
10.1 Intrepid International Financial Services Consulting Agreement 58
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SIGNATURES
In accordance with Section 13 or 15(d) of the Exchange Act, the registrant
caused this report to signed on its behalf by the undersigned, thereunto
authorized.
OASIS ENTERTAINMENT'S FOURTH MOVIE PROJECT, INC
by
/s/ Kirt W. James /s/ Karl E. Rodriguez
Kirt W. James Karl E. Rodriguez
President/Director Secretary/Director
/s/J. Dan Sifford
J. Dan Sifford Jr.
Treasurer/Director
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EXHIBIT 2.1
ARTICLES OF INCORPORATION: OASIS ENTERTAINMENT'S FOURTH MOVIE PROJECT, INC.
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ARTICLES OF INCORPORATION
OF
OASIS ENTERTAINMENT'S FOURTH MOVIE PROJECT, INC.
ARTICLE I. The name of the Corporation is OASIS ENTERTAINMENT'S FOURTH
MOVIE PROJECT, INC.
ARTICLE II. Its principal office in the State of Nevada is 774 Mays Blvd, #
10. Incline Village NV 89451,. The initial resident agent for services of
process at that address is N&R Ltd. Group, Inc., a Nevada Corporation.
ARTICLE III. The purposes for which the corporation is organized are to
engage in any activity or business not in conflict with the laws of the State of
Nevada or of the United States of America. The period of existence of the
corporation shall be perpetual.
ARTICLE IV. The corporation shall have authority to issue an aggregate of
One Hundred Million Shares (100,000,000) of common voting equity stock of par
value one mil ($0.001) per share, and no other class or classes of stock, for a
total capitalization of $100,000.00. The corporation's capital stock may be sold
from time to time for such consideration as may be fixed by the Board of
Directors, provided that no consideration so fixed shall be less than par value.
ARTICLE V. No shareholder shall be entitled to any preemptive or
preferential rights to subscribe to any unissued stock or any other securities
which the corporation may now or hereafter be authorized to issue, nor shall any
shareholder possess cumulative voting rights at any shareholders meeting, for
the purpose of electing Directors, or otherwise.
ARTICLE VI. The affairs of the corporation shall be governed by a Board of
Directors consisting of one to ten persons. The Initial Director of the
Corporation, whose name and address is J. Dan Sifford, Jr., 33481 Spinnaker,
Dana Point, California 92629, to serve until the next regular meeting of
shareholders or until their successors are elected.
ARTICLE VII. The Capital Stock, after the amount of the subscription price
or par value, shall not be subject to assessment to pay the debts of the
corporation, and no stock issued, as paid up, shall ever be assessable or
assessed.
ARTICLE VIII. The initial By-laws of the corporation shall be adopted by
its Board of Directors. The power to alter, amend or repeal the By-laws, or
adopt new By-laws, shall be vested in the Board of Directors, except as
otherwise may be specifically provided in the By-laws.
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ARTICLE IX. The name and address of the Incorporator of the corporation is
J. Dan Sifford, Jr., 33481 Spinnaker, Dana Point, California 92629.
I THE UNDERSIGNED, being the Incorporator hereinbefore named for the
purpose of forming a corporation pursuant the General Corporation Law of the
State of Nevada, do make and file these Articles of Incorporation, hereby
declaring and certifying that the facts herein stated are true, and accordingly
have set my hand hereunto this Day, March 31, 1998.
/s/J.Dan Sifford Jr.
J. Dan Sifford Jr.
Incorporator
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BY-LAWS
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BY-LAWS
OF
OASIS ENTERTAINMENT'S FOURTH MOVIE PROJECT, INC.
A NEVADA CORPORATION
ARTICLE I
CORPORATE OFFICES
The principal office of the corporation in the State of Nevada shall be
located at 774 Mays Blvd. #10, Incline Village NV 89452. The corporation may
have such other offices, either within or without the State of incorporation as
the board of directors may designate or as the business of the corporation may
from time to time require.
ARTICLE II
SHAREHOLDERS' MEETINGS
SECTION 1 PLACE OF MEETINGS
The directors may designate any place, either within or without the State
unless otherwise prescribed by statute, as the place of meeting for any annual
meeting or for any special meeting called by the directors. A waiver of notice
signed by all stockholders entitled to vote at a meeting may designate any
place, either within or without the State unless otherwise prescribed by
statute, as the place for holding such meeting. If no designation is made, or if
a special meeting be otherwise called, the place of meeting shall be the
principal office of the corporation.
SECTION 2 ANNUAL MEETINGS
The annual meeting of the shareholders shall be held on the second Monday
of March in each year, if not a holiday, at Ten o'clock A.M., at which time the
shareholders shall elect a Board of Directors and transact any other proper
business. If this date falls on a holiday, then the meeting shall be held on the
following business day at the same hour.
SECTION 3 SPECIAL MEETINGS
Special meetings of the shareholders may be called by the President, the
Board of Directors, by the holders of at least ten percent of all the shares
entitled to vote at the proposed special meeting, or such other person or
persons as may be authorized in the Articles of Incorporation.
Notices of Meetings
SECTION 4 NOTICES OF MEETINGS
Written or printed notice stating the place, day and hour of the meeting
and, in the case of a special meeting, the purpose or purposes for which the
meeting is called, shall be delivered not less than ten (10) days nor more than
twenty (20) days before the date of the meeting, either personally or by mail,
by the direction of the president, or secretary, or the officer or persons
calling the meeting. If mailed, such notice shall be deemed to be delivered when
deposited in the United States mail, addressed to the stockholder at his address
as it appears on the stock transfer books of the corporation, with postage
thereon prepaid.
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SECTION 5 CLOSING OF TRANSFER BOOKS OR FIXING RECORD DATE.
For the purpose of determining stockholders entitled to notice of or to
vote at any meeting of stockholders or any adjournment thereof, or stockholders
entitled to receive payment of any dividend, or in order to make a determination
of stockholders for any other proper purpose, the directors of the corporation
may provide that the stock transfer books shall be closed for a stated period
but not to exceed, in any case twenty (20) days. If the stock transfer books be
closed for the purpose of determining stockholders entitled to notice or to vote
at a meeting of stockholders, such books shall be closed for at least twenty
(20) days immediately preceding such meeting. In lieu of closing the stock
transfer books, the directors may fix in advance a date as the record date for
and such determination of stockholders, such date in any case to be not more
than twenty (20) days and, in case of a meeting of stockholders, not less than
ten (10) days prior to the date on which the particular action requiring such
determination of stockholders entitled to notice of or to vote at a meeting of
stockholders, or stockholders entitled to receive payment of a dividend, the
date on which notice of the meeting is mailed or the date on which the
resolution of the directors declaring such dividend is adopted, as the case may
be, shall be the record date for such determination of stockholders. When a
determination of stockholders entitled to vote at any meeting of stockholders
has been made as provided in this section, such determination shall apply to any
adjournment thereof.
SECTION 6 VOTING LIST.
The officer or agent having charge of the stock transfer books for the
shares of the corporation shall make, at least ten (10) days before each meeting
of stockholders, a complete list of stockholders entitled to vote at such
meeting, or any adjournment thereof, arranged in alphabetical order, with the
address of and number of shares held by each, which list, for a period of ten
(10) days prior to such meeting, shall be kept on file at the principal office
of the corporation and shall be subject to inspection by any stockholder at any
time during usual business hours. Such list shall also be produced and kept open
at the time and place of the meeting and shall be subject to the inspection of
any stockholder during the whole time of the meeting. The original stock
transfer book shall be prima facie evidence as to who are the stockholders
entitled to examine such list or transfer books or to vote at the meeting of
stockholders.
SECTION 7 QUORUM.
At any meeting of stockholders fifty-one (51) percent of the outstanding
shares of the corporation entitled to vote, represented in person or by proxy,
shall constitute a quorum at a meeting of stockholders. If less than said number
of the outstanding shares are represented at a meeting, a majority of the
outstanding shares so represented may adjourn the meeting from time to time
without further notice. At such adjourned meeting at which a quorum shall be
present or represented, any business may be transacted which might have been
transacted at the meeting originally notified. The stockholders present at a
duly organized meeting may continue to transact business until adjournment,
notwithstanding the withdrawal of enough stockholders to leave less than a
quorum.
SECTION 8 PROXIES.
At all meetings of the stockholders, a stockholder may vote by proxy
executed in writing by the stockholder or by his duly authorized attorney in
fact. Such proxy shall be filed with the secretary of the corporation before or
at the time of the meeting.
SECTION 9 VOTING.
Each stockholder entitled to vote in accordance with the terms and
provisions of the certificate of incorporation and these by-laws shall be
entitled to one vote, in person or by proxy, for each share of stock entitled to
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vote held by such shareholder. Upon the demand of any stockholder, the vote for
directors and upon any question before the meeting shall be by ballot. All
elections for directors shall be decided by plurality vote; all other questions
shall be decided by majority vote except as otherwise provided by the
Certificate of Incorporation or the laws of Nevada.
SECTION 10 ORDER OF BUSINESS.
The order of business at all meetings of the stockholders, shall be as
follows:
a. Roll Call.
b. Proof of notice of meeting or waiver of notice.
c. Reading of minutes of preceding meeting.
d. Reports of Officers.
e. Reports of Committees.
f. Election of Directors.
g. Unfinished Business.
h. New Business.
SECTION 11 INFORMAL ACTION BY STOCKHOLDERS.
Unless otherwise provided by law, any action required to be taken, or any
other action which may be taken, at a meeting of the stockholders, may be taken
without a meeting if a consent in writing, setting forth the action so taken,
shall be signed by all of the stockholders entitled to vote with respect to the
subject matter thereof. Unless otherwise provided by law, any action required to
be taken, or any other action which may be taken, at a meeting of the
stockholders, may be taken without a meeting if a consent in writing, setting
forth the action so taken, shall be signed by a Majority of all of the
stockholders entitled to vote with respect to the subject matter thereof at any
regular meeting called on notice, and if written notice to all shareholders is
promptly given of all action so taken.
SECTION 12 BOOKS AND RECORDS.
The Books, Accounts, and Records of the corporation, except as may be
otherwise required by the laws of the State of Nevada, may be kept outside of
the State of Nevada, at such place or places as the Board of Directors may from
time to time appoint. The Board of Directors shall determine whether and to what
extent the accounts and the books of the corporation, or any of them, other than
the stock ledgers, shall be open to the inspection of the stockholders, and no
stockholder shall have any right to inspect any account or book or document of
this Corporation, except as conferred by law or by resolution of the
stockholders or directors. In the event such right of inspection is granted to
the Stockholder(s) all fees associated with such inspection shall be the sole
expense of the Stockholder(s) demanding the inspection. No book, account, or
record of the Corporation may be inspected without the legal counsel and the
accountants of the Corporation being present. The fees charged by legal counsel
and accountants to attend such inspections shall be paid for by the Stockholder
demanding the inspection.
ARTICLE III
BOARD OF DIRECTORS
SECTION 1 GENERAL POWERS.
The business and affairs of the corporation shall be managed by its board
of directors. The directors shall in all cases act as a board, and they may
adopt such rules and regulations for the conduct of their meetings and the
management of the corporation, as they may deem proper, not inconsistent with
these by-laws and the laws of this State.
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SECTION 2 NUMBER, TENURE, AND QUALIFICATIONS.
The number of directors of the corporation shall be a minimum of one (l)
and a maximum of nine (9). Each director shall hold office until the next annual
meeting of stockholders and until his successor shall have been elected and
qualified.
SECTION 3 REGULAR MEETINGS.
A regular meeting of the directors, shall be held without other notice than
this by-law immediately after, and at the same place as, the annual meeting of
stockholders. The directors may provide, by resolution, the time and place for
holding of additional regular meetings without other notice than such
resolution.
SECTION 4 SPECIAL MEETINGS.
Special meetings of the directors may be called by or at the request of the
president or any two directors. The person or persons authorized to call special
meetings of the directors may fix the place for holding any special meeting of
the directors called by them.
SECTION 5 NOTICE.
Notice of any special meeting shall be given at least one day previously
thereto by written notice delivered personally, or by telegram or mailed to each
director at his business address. If mailed, such notice shall be deemed to be
delivered when deposited in the United States mail so addressed, with postage
thereon prepaid. The attendance of a director at a meeting shall constitute a
waiver of notice of such meeting, except where a director attends a meeting for
the express purpose of objecting to the transaction of any business because the
meeting is not lawfully called or convened.
SECTION 6 QUORUM.
At any meeting of the directors fifty (50) percent shall constitute a
quorum for the transaction of business, but if less than said number is present
at a meeting, a majority of the directors present may adjourn the meeting from
time to time without further notice.
SECTION 7 MANNER OF ACTING.
The act of the majority of the directors present at a meeting at which a
quorum is present shall be the act of the directors.
SECTION 8 NEWLY CREATED DIRECTORSHIPS AND VACANCIES.
Newly created directorships resulting from an increase in the number of
directors and vacancies occurring in the board for any reason except the removal
of directors without cause may be filled by a vote of the majority of the
directors then in office, although less than a quorum exists. Vacancies
occurring by reason of the removal of directors without cause shall be filled by
vote of the stockholders. A director elected to fill a vacancy caused by
resignation, death or removal shall be elected to hold office for the unexpired
term of his predecessor.
SECTION 9 REMOVAL OF DIRECTORS.
Any or all of the directors may be removed for cause by vote of the
stockholders or by action of the board. Directors may be removed without cause
only by vote of the stockholders.
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SECTION 10 RESIGNATION.
A director may resign at any time by giving written notice to the board,
the president or the secretary of the corporation. Unless otherwise specified in
the notice, the resignation shall take effect upon receipt thereof by the board
or such officer, and the acceptance of the resignation shall not be necessary to
make it effective.
SECTION 11 COMPENSATION.
No compensation shall be paid to directors, as such, for their services,
but by resolution of the board a fixed sum and expenses for actual attendance at
each regular or special meeting of the board may be authorized. Nothing herein
contained shall be construed to preclude any director from serving the
corporation in any other capacity and receiving compensation therefore.
SECTION 12 EXECUTIVE AND OTHER COMMITTEES.
The board, by resolution, may designate from among its members an executive
committee and other committees, each consisting of one (l) or more directors.
Each such committee shall serve at the pleasure of the board.
ARTICLE IV
OFFICERS
SECTION 1 NUMBER.
The officers of the corporation shall be the president, a secretary and a
treasurer, each of whom shall be elected by the directors. Such other officers
and assistant officers as may be deemed necessary may be elected or appointed by
the directors.
SECTION 2 ELECTION AND TERM OF OFFICE.
The officers of the corporation to be elected by the directors shall be
elected annually at the first meeting of the directors held after each annual
meeting of the stockholders. Each officer shall hold office until his successor
shall have been duly elected and shall have qualified or until his death or
until he shall resign or shall have been removed in the manner hereinafter
provided.
SECTION 3 REMOVAL.
Any officer or agent elected or appointed by the directors may be removed
by the directors whenever in their judgment the best interest of the
corporation would be served thereby, but such removal shall be without prejudice
to contract rights, if any, of the person so removed.
SECTION 4 VACANCIES.
A vacancy in any office because of death, resignation, removal,
disqualification or otherwise, may be filled by the directors for the unexpired
portion of the term.
SECTION 5 PRESIDENT.
The president shall be the principal executive officer of the corporation
and, subject to the control of the directors, shall in general supervise and
control all of the business and affairs of the corporation. He shall, when
present, preside at all meetings of the stockholders and of the directors. He
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may sign, with the secretary or any other proper officer of the corporation
thereunto authorized by the directors, certificates for shares of the
corporation, any deeds, mortgages, bonds, contracts, or other instruments which
the directors have authorized to be executed, except in cases where the
directors or by these by-laws to some other officer or agent of the corporation,
or shall be required by law to be otherwise signed or executed; and in general
shall perform all duties incident to the office of president and such other
duties as may be prescribed by the directors from time to time.
SECTION 6 CHAIRMAN OF THE BOARD.
In the absence of the president or in the event of his death, inability or
refusal to act, the chairman of the board of directors shall perform the duties
of the president, and when so acting, shall have all the powers of and be
subject to all the restrictions upon the president. The chairman of the board of
directors shall perform such other duties as from time to time may be assigned
to him by the directors.
SECTION 7 SECRETARY.
The secretary shall keep the minutes of the stockholders' and of the
directors' meetings in one or more books provided for that purpose, see that all
notices are duly given in accordance with the provisions of these by-laws or as
required, be custodian of the corporate records and of the seal of the
corporation and keep a register of the post office address of each stockholder
which shall be furnished to the secretary by such stockholder, have general
charge of the stock transfer books of the corporation and in general perform all
the duties incident to the office of secretary and such other duties as from
time to time may be assigned to him by the president or by the directors.
SECTION 8 TREASURER.
If required by the directors, the treasurer shall give a bond for the
faithful discharge of his duties in such sum and with such surety or sureties as
the directors shall determine. He shall have charge and custody of and be
responsible for all funds and securities of the corporation; receive and give
receipts for moneys due and payable to the corporation from any source
whatsoever, and deposit all such moneys in the name of the corporation in such
banks, trust companies or other depositories as shall be selected in accordance
with these by-laws and in general perform all of the duties incident to the
office of treasurer and such other duties as from time to time may be assigned
to him by the president or by the directors.
SECTION 9 SALARIES.
The salaries of the officers shall be fixed from time to time by the
directors and no officer shall be prevented from receiving such salary by reason
of fact that he is also a director of the corporation.
ARTICLE V
CONTRACTS, LOANS, CHECKS AND DEPOSITS
SECTION 1 CONTRACTS.
The directors may authorize any officer or officers, agent or agents to
enter into any contract or execute and deliver any instrument in the name of and
on behalf of the corporation, and such authority may be general or confined to
specific instances.
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SECTION 2 LOANS.
No loans shall be contracted on behalf of the corporation and no evidences
of indebtedness shall be issued in its name unless authorized by a resolution of
the directors. Such authority may be general or confined to specific instances.
SECTION 3 CHECKS, DRAFTS, ETC.
All checks, drafts or other orders for the payment of money, notes or other
evidences of indebtedness issued in the name of the corporation, shall be signed
by such officer or officers, agent or agents of the corporation and in such
manner as shall from time to time be determined by resolution of the directors.
SECTION 4 DEPOSITS.
All funds of the corporation not otherwise employed shall be deposited from
time to time to the credit of the corporation in such banks, trust companies or
other depositories as the directors may select.
ARTICLE VI
FISCAL YEAR
The fiscal year of the corporation shall begin on the 1st day of January in
each year, or on such other day as the Board of Directors shall fix.
ARTICLE VII
DIVIDENDS
The directors may from time to time declare, and the corporation may pay,
dividends on its outstanding shares in the manner and upon the terms and
conditions provided by law.
ARTICLE VIII
SEAL
The directors may provide a corporate seal which shall have inscribed
thereon the name of the corporation, the state of incorporation, year of
incorporation and the words, "Corporate Seal".
ARTICLE IX
WAIVER OF NOTICE
Unless otherwise provided by law, whenever any notice is required to be
given to any stockholder or director of the corporation under the provisions of
these by-laws or under the provisions of the articles of incorporation, a waiver
thereof in writing, signed by the person or persons entitled to such notice,
whether before or after the time stated therein, shall be deemed equivalent to
the giving of such notice.
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ARTICLE X
AMENDMENTS
These by-laws may be altered, amended or repealed and new by-laws may be
adopted by a vote of the stockholders representing a majority of all the shares
issued and outstanding, at any annual stockholders' meeting or at any special
stockholders' meeting when the proposed amendment has been set out in the notice
of such meeting.
CERTIFICATION
THE SECRETARY of the Corporation hereby certifies that the foregoing is a
true and correct copy of the By-Laws of the Corporation named in the title
thereto and that such By-Laws were duly adopted by the Board of Directors of
said Corporation on the date set forth below.
EXECUTED, AND CORPORATE SEAL AFFIXED, this day of April 6, 1998.
/s/Karl E. Rodriguez
Karl E. Rodriguez
Secretary
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EXHIBIT 10.1
INTREPID INTERNATIONAL FINANCIAL SERVICES CONSULTING AGREEMENT
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INTREPID INTERNATIONAL
FINANCIAL SERVICES
CONSULTING AGREEMENT
THIS AGREEMENT is made by and between Intrepid International, Ltd., a Nevada
Corporation, (hereafter IIL ), and Oasis Entertainment's Fourth Movie Project,
Inc. a Nevada Corporation, (hereafter Client ) and dated April 6. In
consideration of the mutual promises contained herein, and on the terms and
conditions herein set forth, the parties agree as follows:
1. RETAINER AGREEMENT.
Intrepid International, Ltd. is hereby retained as financial services
consultants for the Client, consistent with that certain Description of Mission
and Services Offered, a copy of which is Attachment 1 to this Consulting
Agreement, and incorporated herein by this reference as though fully set forth
herein. Among the services to be provided and contemplated by this arrangement
are the services of its President, Kirt W. James (billable at $150.00/hr), its
prime consultant, J. Dan Sifford Jr. (billable at $240.00/hr), and such
incidental secretarial services (billable at $100.00/hr) as may be reasonably
and necessarily performed by its secretary. Additional services may be performed
by subcontractors of IIL, subject to arrangements approved by Client in advance.
2. SERVICES
IIL agrees to provide, as requested, the widest possible range of and
Financial Consulting services, to Management of Client, subject to, limited by
and consistent with that certain Description of Mission and Services Offered, a
copy of which is Attachment 1 to this Consulting Agreement, and incorporated
herein by this reference as though fully set forth herein. Such services
include, as requested by Client, coordination of public relations, shareholder
relations, audit coordination, certificate and transfer coordination,
coordination of relationships with market-makers and broker dealers in the
securities of Client and consulting services, incidental analysis and, where
appropriate, and subject to the accompanying Attorney Disclosure Agreement,
written legal opinions by IIL Counsel acting, as requested by Client, as Special
Securities Counsel with Limited Authority, and the preparation and coordination
of annual, quarterly and current filings as may be required of the Client
pursuant to the Securities and Exchange Act of 1934 and Regulations of the
Securities and Exchange Commission promulgated pursuant to the 1934 Act.
3. COMPENSATION
In consideration for such services, Client agrees to pay IIL pursuant to
fee schedule set forth in paragraph 1 above. Billings for services shall be
invoiced by IIL and paid upon receipt.
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4. PAYMENT OF EXPENSES
IIL must secure in writing approval in advance for any expense that may be
contracted on behalf of Client in excess of $400 in the aggregate. Expenses, if
approved, are to be invoiced by IIL and paid upon receipt. In addition to
charges for services, Client will be billed for all normal and incidental
identifiable costs such as copying charges, telephone expenses, delivery fees,
filing fees, and transcription fees; however, travel expenses, expert witness
fees and other extraordinary charges will not be incurred without prior
approval.
5. UNPAID CHARGES
It is agreed that if at any time any invoice rendered by this Firm to
Client for investment banking, appropriate legal services and expenses remains
unpaid for any reason for longer than 30 days, we shall have the right to
discontinue performance of further services and to withdraw as your attorneys,
regardless of the status of any matter in which we will be involved and
regardless of any event or proceeding which may then be pending, unless we have
reached a subsequent written agreement with respect thereto.
6. LATE CHARGES
An amount past due will incur a late charge, after 30 days, of 1.5% per
month (18% per annum) of the total unpaid balance. Late charges will continue to
accrue at the same rate on any unpaid balance during any collection efforts and
until the entire bill is paid in full, unless a subsequent agreement with
respect to such charges is made and reduced to writing. Should it become
necessary to seek collection of any past due statement, you agree to pay all
reasonable costs of collection including reasonable attorneys' fees and all
interest incurred.
7. ARBITRATION OF ANY DISPUTES
It is agreed that any dispute arising our of this Agreement, or the Firm's
representation of you, shall be resolved by binding arbitration in Las Vegas,
Nevada, by the American Arbitration Association.
8. LIABILITY OF IIL
In furnishing Client with advice and other services as requested, neither
IIL nor any owner, employee or agent of IIL, shall be liable to Client or its
creditors for ordinary errors of judgment or for anything except gross
negligence, willful malfeasance, or bad faith, in the performance of its duties
or reckless disregard of its obligations and duties under the terms of this
agreement. It is further understood and agreed that IIL may rely upon
information furnished to it reasonably believed to be accurate and reliable and
that, except as herein provided, IIL shall not be accountable for any loss
suffered by Client by reason of Client's action or non-action on the basis of
advice, recommendation or approval of IIL, its owners, employees or agents.
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9. GOOD FAITH AND FAIR DEALING
All parties to this agreement hereby covenant expressly to deal with each
other honestly, fairly and in good faith in all respects, and to provide each
other with reasonable further assurances in furtherance of their mutual
performances with respect to this Agreement.
10. INDEPENDENT CONTRACTOR
IIL is and shall at all times be understood and deemed to be an independent
contractor without authority to act or represent Client or its clients, except
as provided or authorized in this agreement.
11. NON-EXCLUSIVITY
Client recognizes and acknowledges that this agreement is non-exclusive,
and that accordingly IIL now renders and may in the future render services to
other clients, some of which may be of a nature similar to those agreed to be
performed herein, or to clients with similar businesses, needing similar advice.
IIL is and shall be free to render any such service or advice and shall not be
required to devote full-time and attention to its obligations under this
agreement, but only such amount as is reasonably necessary.
12. CONTROL
Nothing contained herein shall be deemed to require any action by any
Corporation contrary to law or its constituent documents or to relieve the board
of directors thereof from responsibility for control of the affairs of such
corporation.
13. OWNERSHIP OF FILES AND RECORDS
Except as to original records or any records or files which we accept upon
the understanding that they belong to you, it hereby is agreed that all files,
copies of documents, correspondence or other materials which we may accumulate
in connection with your representation, including copies of materials filed with
any regulatory agency, shall be the property of IIL. Upon the termination of the
engagement, IIL will return any property belonging to you upon your request.
Copies of our files and other materials which IIL may have accumulated during
our representation will be made available to Client at its expense; however, it
is specifically agreed that IIL shall have the right, in its discretion, to
dispose of these files at such times as it determines reasonably that such files
need not be retained any longer. After such destruction, such files will no
longer be available.
14. TERMINATION
The term of this agreement shall begin with the complete execution hereof,
and shall continue in effect for until terminated by either party in writing.
Upon termination, all accrued charges shall be promptly invoiced and paid.
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15. MISCELLANEOUS
This agreement sets forth the entire agreement and understanding between
the parties and supersedes all prior discussions, agreements and understandings,
if any, of any and every kind and nature, between them. This agreement is made
and shall be construed and interpreted according to the laws of the Client's
place of Incorporation if that be Nevada or Texas, and if not, pursuant to the
laws of the State of Nevada.
ACCORDINGLY the parties cause this agreement to be signed by their duly
authorized representative, as of the date written below.
Intrepid International, Ltd.
by
/s/ Kirt W. James
Kirt W. James, President
THE ABOVE IS UNDERSTOOD AND AGREED TO and I state under the penalties of perjury
that I am authorized to execute this letter agreement:
Oasis Entertainment's Fourth Movie Project, Inc.
Date: 4/6/98 By:/s/ Kirt W. James
Kirt W. James, President
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Attachment 1
DESCRIPTION OF MISSION AND SERVICES OFFERED
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Intrepid International, S. A.
DESCRIPTION OF MISSION AND SERVICES OFFERED
I. MISSION STATEMENT
INTREPID INTERNATIONAL, S. A. ( the Company ) was incorporated in the
Republic of Panama in 1984 to offer financial services to natural resource
companies, primarily those engaged in the production of oil and gas. Following
the world wide collapse of oil prices in the mid-eighties, the Company broadened
the focus of its universe of support services to include a wider range of
companies, with an emphasis on public companies and private companies, companies
engaged in the transition from privately held to publicly held, and development
stage companies, whether public or private, requiring professional business and
corporate guidance. In August of 1997 the Company sought a United States
Representative and entered into a relationship with a group of corporate and
business specialists who, after contracting with the Company, incorporated as
INTREPID INTERNATIONAL, LTD. ( Intrepid US ) to provide the required
representation and agency for the Company in North America and Europe. Intrepid
US is incorporated in the State of Nevada.
Intrepid enjoys a wide range of brokerage community and financial services
relationships which form the basis of its ability to introduce client companies
to consultants, professionals, broker dealers and others who may be of service
to client companies in pursuing the business plan and other objectives the
client may have.
Intrepid is not an investment banker, nor a broker or dealer in securities.
Intrepid is a provider of technical support services to client companies.
Intrepid does not practice law or supply legal services generally, however,
Intrepid's counsel may, under appropriate circumstances be available to client's
counsel, where such assistance is requested and appropriate.
Intrepid provides its services on a negotiated time/fee basis. Intrepid
does not provide services for commissions based upon the success or failure of
any corporate program, and Intrepid is not a fund-raiser or a source of capital
financing. However, sources of capital financing exist, and Intrepid is often
able to provide the introductions to suitable professionals, business brokers
and securities professionals who may be able to assist an issuer in developing
or executing such fund raising programs as the issuer may adopt.
The principal focus and benefit of the services offered by Intrepid are not
its client's capital formation nor fund raising activities, but the refinement
of client's business plan, analysis of its corporate structure, evaluation of
its current filing status and filing responsibilities, currency and accuracy of
financial information and auditability or status of current and past audits and
audit procedures, to assist managers in making the conceptual and procedural
transitions imposed upon Officers and Directors, with respect to shareholders,
shareholder rights, and maintenance of the kinds current public information
necessary to position a company to consider public trading of its existing
securities, and to maintain its impeccability as a publicly trading company if
and when its securities are exposed to the public markets.
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Accordingly, the mission of Intrepid is to assist client companies in
avoiding costly mistakes and pitfalls in corporate management, going public,
being public, and in handling the various different relationships with
professionals and the public which are appropriate, practical, efficient and
cost-effective in managing a public corporation.
II. SERVICES TO ISSUERS
Every Corporation and Issuer of Securities is unique. Its businesses,
structure, aspirations status and time horizons are particular to the interest
of its shareholders, and the policies of its Management. Intrepid's services may
address the full spectrum of corporate situations.
A. PUBLIC AND PRIVATE COMPANIES
1. CLOSELY HELD PRIVATE COMPANIES are corporations, limited partnerships
and limited liability companies, held by a relatively small group of
shareholders, often the founders, and usually not less than two nor more than 35
shareholders. Typically, the shareholders know each other and/or some or all of
the managers. Such a company may have determined to stay small and never go
public. Such a company may intend to grow, and keep open the vision of expanding
into public ownership at some future time. There are important considerations
for mangers of this latter group, chiefly the understanding that all public
companies must be auditable. This means not only that books and records be kept
in an orderly and consistent manner, but that some corporate understanding the
special accounting rules of Regulation SX (promulgated by the Securities and
Exchange Commission) be developed and considered in connection with the
acquisition of assets or the issuance of stock for property or other rights,
particularly. It is also important to develop an understanding, policy, format
and consistent procedure for meetings of Directors, Shareholders and maintaining
proper corporate minutes, from inception and thereafter.
2. MORE WIDELY HELD PRIVATE COMPANIES are companies whose securities do
not trade on any public market, but which have a growing shareholder base no
longer characterized by personal relationships between shareholders and
management. Such companies may wish to remain private; however, pressure to deal
with public company issues may arise, invited or not, as the shareholder base
expands, the business grows in profitability, size and extent of operations and
the passage of time, the passing of original shareholders and the inheritance of
ownership by a family group, the need to attract new investment, the desire of
original owners to retire and to develop an exist strategy for the sale of their
business or ownership thereof. Going public is a series of successive headaches,
best cured by knowledge of potential pitfalls and early preparation for
eventualities. The best policy is always to gather information early and
prepare.
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3. PUBLIC COMPANIES come in more than one distinctive status, with
different corporate responsibilities and opportunities. It is essential for all
issuers of any size and status to be mindful of anti-fraud and similar
provisions in connection with any transaction in securities.
(A) 15C2-11 COMPANIES are those which do not and are not required to file
reports directly to the Securities an Exchange Commission, but whose securities
trade over-the-counter, normally on the OTC Bulletin Board maintained by the
NASD. The OTC Bulletin board is not and must not be confused with NASDAQ. The
term the over the counter market was once used to refer to NASDAQ, but that
reference or the use of that terminology today is inappropriate and potentially
wrongful. A 15c2-11 company has not registered the issuance of its securities
under the Securities Act of 1933, nor has it registered any class of its
securities for trading under the Securities Exchange Act of 1934. Such a company
has acquired its shareholder base by one or more private placements or limited
public offerings, perhaps pursuant to Regulations A or D, or other exemption
available under the 1933 Securities Act or promulgated by the Commission
pursuant to the 1933 Act. 15c2-11 Companies, which do not report to SEC, must
report to current information to their market makers and others with respect to
a form commonly called their 15c2-11 Report . The company must be audited and
the audit must be brought current at least each fiscal year, and preferably more
often. Current unaudited financial statements are important between audit
cycles, and changes in the business and operations of the company, significant
share ownership information, and other material information must be available to
the public. Failure to do so may result in de-listing, stop trading, or even
liability in extreme cases.
The OTCBB is in transition to phase in the requirement that companies
be or become reporting companies.
(B) 15(D) COMPANIES are those which have issued securities pursuant to an
effective Registration Statement, under the Securities Act of 1933. While the
securities of such companies do not trade on NASDAQ or any National or Regional
Exchange, such companies are required to furnish Annual Reports, Quarterly
Reports, and Current Reports, in the forms prescribed by the Commission. The
securities of such companies may trade on the OTC Bulletin Board, or not at all.
The reporting requirements are not contingent upon whether such a company is
active, trading, or not. It is vital that the financial and other information be
gathered at the end of each reporting cycle and that it be presented in its
appropriate form and properly and propitiously filed.
(C) 13 COMPANIES are those with securities that do trade on NASDAQ or an
Exchange, or even if not trading, which have a class of securities registered
under 12(b) or 12(g) of the Securities Exchange Act of 1934. Such Issuers
have extensive additional reporting requirement under 13 of the 1934 Act and
Regulations promulgated with respect thereto. These companies must be concerned
with reports of insider trading, and must observe special rules for calling
shareholder meetings whether or not proxies are solicited, among other specific
and detailed requirements.
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(D) THE MOST COMMON PITFALL of private companies which have become public
by submission through a broker/dealer (market maker) to the NASD for permission
to publish a quote on the OTC Bulletin Board is quite simply stated: once the
Company is up, and conditions change, or time passes, the public information
concerning the company grows stale. Companies must maintain a regular updating
process, chiefly of financial information, un-audited quarterly financial
statements, and an annual year-end audit. 15c2-11 Companies, which do not report
to SEC, must report to current information to their market makers and others
with respect to a form commonly called their 15c2-11 Report . Reporting
Companies use SEC forms and file quarterly, annually. Current significant events
must be disclosed promptly in any case. The company must be audited and the
audit must be brought current at least each fiscal year, and preferably more
often. Current unaudited financial statements are important between audit
cycles, and changes in the business and operations of the company, significant
share ownership information, and other material information must be available to
the public. Failure to do so may result in de-listing, stop trading, or even
liability in extreme cases.
B. INTREPID OFFERS technical, clerical, and professional support for
private and public issuers at each of the stages of corporate development. Its
particular services are those that the particular issuer requires and requests.
Intrepid has no fixed program. It can provide some or all of the appropriate
services, to complement and support the skills, knowledge, experience and
availabilities of corporate management.
1. AUDIT COORDINATION. The basic and fundamental focus of responsible
corporate management is the maintenance of proper financial information in
auditable form. A company which is not auditable cannot go public, and may find
itself unsalable even privately. A public company cannot acquire a private
company or its business unless the target of acquisition is capable of being
audited. Reg SX audits involve special considerations and must be conducted by
auditors professionally equipped, and preferably experienced, for doing audits
designed to meet the standards and possible review by NASD and/or SEC examiners.
The audit is the table on which the house of cards rests. Its importance cannot
be overstated. Many issuers find it useful to obtain audit coordination
services, to assist them in communicating effectively with their independent
auditor, and in identifying the information to be gathered for the auditor, and
submitting such information in the form must useful to the auditor for
efficiency and accuracy. Intrepid can provide references to any one or all of a
number of experienced auditors, with special expertise in various business
segments, or can assist the issuer in working with any qualified auditor of its
choice. Intrepid can evaluate the adequacy of audit procedures and alert the
issuer if something not considered should require attention. Intrepid does not
conduct audits or instruct or control auditors or the results of any audit.
Intrepid facilitates effective communication between auditor and issuer, if and
as desired by its clients. Intrepid's evaluation of auditors for its clients is
limited to whether the designated auditor is effectively conversant with
Regulation SX, and whether the auditors experience and qualifications appear
reasonably suitable for the size and scope of the audit required.
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2. BUSINESS PLANS AND MISSION STATEMENTS are important documents for any
corporation public or private. The Mission Statement sets for the goals of the
business. The Business Plan describes the business, its personnel, its
operations, earnings, facilities and perhaps its projections for future years of
operation based upon assumptions carefully considered. The effectiveness and
credibility of these documents, for any purpose, depends upon their meeting the
formal and contextual expectations of persons who read such plans regularly.
Intrepid can assist any company in development of such documents to any standard
the client may require. Such documents are not offering documents. They should
not be confused with offers of securities or solicitations of investment. While
they may be useful in connection with such activities, offering documents
require special attention and must never be casually constructed or
disseminated.
3. BUSINESS VALUATION AND APPRAISALS are often useful to owners and
managers of business. Intrepid can provide detailed professional evaluation and
appraisals of any going concern, which meet the highest professional standards.
Such appraisals may be useful for internal information, or in connection with
purchase or sale of a given business. Such Valuations and Appraisals of
businesses are not audits or financial statements respecting the issuer of
securities and should not be confused with offers of securities or solicitations
of investment. While they may be useful in connection with such activities,
offering documents require special attention and must never be casually
constructed or disseminated.
4. CERTIFICATE AND TRANSFER AGENCY. Intrepid is not a Transfer Agent nor
Agent for maintaining the Certificate and Transfer Records of its
issuer-clients. Many small or private issuers maintain their own records and
perform their own Certificate and Transfer function. When the securities of an
issuer are traded publicly, or when private transactions become other than
routine and rare, the company should retain the services of a bonded Certificate
and Transfer Agent, for its own protection and to insure the orderly and
professional handling of its Certificate and Transfer function. Intrepid can
recommend such agencies from a number of reputable choices, and, whatever
choice, can assist and coordinate the process by which the Agent is engaged, a
certified shareholder list prepared, and Intrepid can co-ordinate communication
between the issuer and its Transfer Agent, if desired by its client.
5. LEGAL OPINIONS. Many different corporate transactions require or are
facilitated by a legal opinion by an attorney. There is no reason why such
opinions could not or should not be prepared by the client's own counsel or
independent counsel of the client's choice. Some clients express the preference
that certain legal opinions be provided or secured by Intrepid as a part of the
services selected and requested by the client. Depending upon the nature of the
opinion required, Intrepid's counsel may be able to provide appropriate legal
opinions on the issuer's behalf of for the issuer's benefit; provided that at
all times material to such participation, and to any participation, by Intrepid
Counsel, it be clearly and expressly understood that Intrepid Counsel is counsel
to Intrepid, and not to the Issuer, and that should the Issuer request for its
own benefit that Intrepid Counsel be regarded or referred to as Special Counsel
to the Issuer, it be understood and intended that any such participation be
limited to the specific purposes for which Intrepid may have been retained, and
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limited to the specific tasks requested of Intrepid which are appropriately
referred to its Counsel. Intrepid Counsel shall not become or be construed to be
an advisor or confidant of any client outside the scope of activities requested
by the Client of Intrepid. Intrepid Counsel shall be available to consult with
Client's counsel in a normal and professional manner, in furtherance of the
responsibilities assigned to Intrepid by the client, or at arms length as
between Intrepid and its Client.
6. REPORTING DOCUMENTS. Intrepid, and its Counsel can assist any issuer in
preparing and causing the assembly and filing of reports required of public
companies, with information supplied by the issuer. Most common are Annual,
Quarterly and Current Reports, for reporting companies, and Issuer Information
Statements pursuant respect to form 15c2-11 with respect to non-reporting
companies.
7. OFFERINGS AND OFFERING DOCUMENTS. Any offering or solicitation of any
transactions in securities requires careful conformity to law and regulation of
the United States and possibly State or other local Jurisdictions. Intrepid can
assist any issuer-client in the preparation of offering documents, of several
varieties, and Intrepid, with the assistance of its counsel can provide
information as to the apparent availability or non-availability of any form of
offering, if requested by its clients. Intrepid does not conduct offering for
the issuer, but assists the management of the issuer in doing so. Intrepid does
not solicit investors or investment for its clients. Intrepid may provide
introductions which may result in negotiations between sophisticated persons,
but Intrepid does not take part in soliciting capital, other than its technical,
clerical, and other specific support for management activities. It is
appropriate and proper that most solicitations, if there are to by any, be
conducted for the issuer through registered broker/dealers. Any activity by
Intrepid in fund raising or capital formation activities by or for an
issuer-client shall be limited to ministerial performance and execution of
matters passed upon and directed by management.
8. MERGERS AND ACQUISITIONS. Intrepid has considerable experience in
assisting issuers engaged in merger, acquisitions or other forms of corporate
reorganizations. Intrepid does not broker mergers or acquisitions. Intrepid can
provide substantial assistance to issuers so engaged, with the participation of
its counsel, with respect to the formal and legal requirements of tendering,
calling shareholder meetings and conducting them properly, preparing minutes and
certifications of shareholder meetings, whether or not proxies be requested, and
executing filing requirements with respect to such transactions before and after
their consummation as may be appropriate. Intrepid does not search for merger
and acquisition candidates, but it is often contacted by such candidates (who
are not its clients). In the event that an introduction by Intrepid results in a
transaction, Intrepid will not claim or receive any finders fee or commission
for such introduction, but will continue in its invariable practice of billing
clients for time and effort expended at pre-agreed hourly rates.
9. MARKET COORDINATION, SHAREHOLDER AND BROKER RELATIONS. It is the
function and responsibility of each issuer to deal with relationships arising
from public interest and access to its securities. The volume of calls and kinds
of technical information requested may become burdensome to managements of
limited size, resources or expertise. Intrepid can accept the ministerial
delegation of such management functions and can participate public relations,
shareholder relations, broker relations and market co-ordination; provided that
such delegation shall be confined to carrying out corporate policy, and provided
that information disseminated shall be authorized and directed by the issuer,
and shall not include any public or private offering, solicitation or
advertising, in connection with any offer or sale of securities.
10. STRUCTURING DEALS. Intrepid does not structure deals for its clients.
It does present to clients its knowledge and experience commended for
consideration by management in management's development of its own plans and
programs. Intrepid neither recommends nor discourages any company's going
public. It offers the following General Considerations for Companies Evaluating
Going Public, a copy of which is provided herewith.
III. MANAGEMENT OF INTREPID
A. INTREPID INTERNATIONAL, S.A. The officers and directors of Intrepid
International, S. A. (Panama) are comprised of three individuals; Laurencio Jaen
O., Teodoro F. Franco L. and Leopoldo Kennion G. All three of these individuals
are Panamanian citizens and each serves as an officer and a director of the
Company.
Laurencio Jaen O., an original incorporator who has served as President and
Director of the Company since its inception in 1984, resides in Panama City,
Republic of Panama. He is, and has been for the past twenty five years, Vice
President of Indiasa Corporation ("Indiasa"), a Panamanian corporation, which,
through one of its subsidiaries, Robmar International, is involved in the
manufacture and distribution of chemical products in Argentina and Brazil and
which, through its former subsidiary Indiasa Aviation Corporation, was, for
eight years ending in 1981, engaged in aviation consulting, the leasing,
purchase and sale of aircraft, and the operation of a cargo airline, primarily
in Latin America. Mr. Jaen was a founder of PAISA, Panama's international
airline, served as president of the Colon Free Zone (the world s largest free
trade zone), and as Director of Panama's Social Security Administration. He has
also served as the President of the Panamanian Chamber of Commerce, and as a
member of the Board of Presidential Advisors of the Republic of Panama.
Teodoro F. Franco L., Secretary and a Director of the Company, has, for
thirty years, been a specialist in maritime and aviation law. Mr. Franco is a
partner in Franco and Franco, one of the most prestigious law firms in Panama
with offices around the world. In addition to his law practice he has served as
Panamanian Consul to Liverpool, England and for the past five years as
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Ambassador to Great Britain. The firm of Franco and Franco is regarded with the
highest degree of integrity and professionalism in the business and political
community in Panama with its partners and several of its associates holding or
having held public office. Teodoro Franco s brother and partner, Dr. Juaquin F.
Franco, Jr., has held many public offices over the past four decades, most
recently as the Governor of Colon Province, the state containing the Atlantic
entrance to the Panama Canal and the Colon Free Zone. His nephew and associate
in the firm, Juaquin F. Franco, III, has served as the Minister of Commerce and
is currently a member of the House of Representatives and a candidate for
President of the Republic. The firm practices maritime, aviation and commercial
law and currently is the legal firm for: IBERIA (the Spanish national airline),
KLM (the Dutch national airline), VIASA (the Venezuelan national airline),
Aeroflot (the Russian national airline) and various smaller Latin American
national airlines as well as being the registered agents for thousands of ocean
going ships around the world flying the Panamanian flag. Mr. Franco brings to
the Company a wealth of international legal, commercial and diplomatic
experience.
Leopoldo Kennion G., Treasurer and a Director of the Company, is, and has
for twenty years, been a Certified Public Accountant specializing in
international accounting and is an associate in the law firm of Franco and
Franco. Mr. Kennion practices maritime, aviation and commercial accounting
serving the specialized needs of the transnational clients of Franco and Franco
by providing an interface between them and their auditors.
J. Dan Sifford, Jr., is the United States Managing Director for Intrepid
International, S.A. (Panama). He is fluent in the Spanish Language. His
biographical information is found below.
B. INTREPID INTERNATIONAL, LTD. The officers and directors of Intrepid
International, Ltd. (Nevada) are comprised of two individuals; Kirt W. James,
and J. Dan Sifford, Jr. In addition, William Stocker, Esq. serves as the United
States General Counsel. All three of these individuals are U. S. citizens.
Kirt W. James, President and Director, has a lifelong background in
marketing and sales. From 1972 to 1987, Mr. James was responsible for sales and
business administrative matters for Glade N. James Sales Co., Inc.; and from
1987 to 1990 Mr. James built retail markets for American International Medical
Supply Co., a Public Company. In 1990 he formed and become President of HJS
Financial Services, Inc., and is responsible for day to day business of the firm
and consults Client's business and Product Development. During the past five
years Mr. James has been involved in the valuation, sale and acquisition of
numerous private businesses and planning for the entry of private corporations
into the public market place for their securities.
J. Dan Sifford, Jr., Executive Vice President, Secretary/Treasurer and
Director, brings to the Company an extensive experience in Corporate management
and familiarity with transnational business, particularly in Latin America. From
1970 to 1982, he was President and sole shareholder of Overseas Aviation
Corporation, an all cargo airline, with operations throughout South America and
Africa. He was founder, President and Chief Executive Officer of Airline of the
Virgin Islands from 1982 until 1993. He served for many years as President of
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Indiasa Corporation which, through one of its subsidiaries, was involved in the
manufacture and distribution of chemical products in Argentina and Brazil, and
which, through another subsidiary, was for eight years engaged in aviation
consulting, the leasing, purchase and sale of aircraft, and the operation of a
cargo airline, primarily in Latin America. In recent years he has been engaged
continuously in a wide variety of business activities, including the development
of new business ventures.
William Stocker, U.S. Counsel, is an attorney with extensive experience in
real estate, business law and bankruptcy litigation. During the past five years,
he has restricted his practice to general corporate law and services to
corporate clients, dealing with acquisitions, reorganizations and mergers
involving young and emerging businesses. He was admitted to practice in
California on January 13, 1969, and has been a member in good standing
continuously since admission. He is also admitted to practice before the United
States Supreme Court, the United States Court of Claims, the United States Court
of Appeals for the Ninth Circuit, and the United States District Courts for
several of the Federal Districts.
From 1969 until 1980, Mr. Stocker was associated with Fadem, Kanner, Berger
and Stocker a real property litigation firm. Following which, from about 1980 to
1984, he was Chief of Litigation for Bear, Kotob, Ruby and Gross, a general
business, tax and bankruptcy firm. From 1984 through 1986, Mr. Stocker served as
Chief of Litigation for the business firm of Davis, Bolt and Lee. From 1987 to
the present, he has been in private corporate practice, involved in business
formation, and development stage corporate securities matters, and has served as
General or Special Securities Counsel to more than forty development stage
issuers. From 1991 to the present, Mr. Stocker has been Counsel to Mr. James,
and HJS Financial Services, Inc.
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GENERAL CONSIDERATIONS
FOR
COMPANIES EVALUATING GOING PUBLIC
INTREPID INTERNATIONAL neither recommends nor discourages any company's going
public. It offers the following General Considerations in order familiarize
potential clients, who are not public, with the process of going public and to
assist them in coming to a decision as to whether or not to go public, Intrepid
would request consideration of the following information:
THE ADVANTAGES
Going public potentially provides an assortment of both tangible and intangible
benefits, including, but not limited to the following:
INCREASED CAPITAL. When growth can no longer be financed internally or through
borrowings, a public offering can provide your company with additional funds to
acquire other businesses, invest in plants and equipment, expand research and
development efforts, institute new marketing programs, grow inventory or retire
existing debt.
IMPROVED FINANCIAL POSITION. Since an initial public offering is usually in the
form of an equity security, your company will generally not incur additional
debt which must be repaid. There is an immediate improvement in your company's
balance sheet and your debt-to-equity ratio.
LESS DILUTION. If your company is at the stage where it is ready to go public,
you may command a higher price for your securities through a public offering
than through a private placement or other form of equity financing. This means
that you give up less of your company to receive the same amount of funding.
ENHANCED ABILITY TO RAISE CAPITAL. As your company continues to grow, you are
likely to need additional permanent financing some years down the road. If your
stock performs well in the stock market, you will be able to sell additional
stock on favorable terms.
LIQUIDITY AND VALUATION. Once your company goes public a market will be
established for your stock. A public market make it easier for you to dispose of
a portion of your interest should you want to diversify your investment
portfolio or if you are ready to leave the company. And, subject to SEC
regulations (see the discussion of rule 144), you may sell your stock whenever
the need arises.
Some major shareholders, such as venture capital firms require liquidity in any
company in which they become involved. Venture capital firms generally organize
funds with an expected life of approximately five years. At the end of that
period, they need to liquidate the fund. By going public, you provide the
venture capitalists with the ability to sell their holdings or to hold publicly
traded stock that can be distributed to their fund participants.
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IMPROVED CREDIBILITY WITH SUPPLIERS AND CUSTOMERS. The simple fact that you are
public makes a strong statement about your ability to pay bills and serve your
customers. Prospective suppliers and customers thus feel more secure about
entering into relationships with your company.
BETTER EMPLOYEE MORAL AND PRODUCTIVITY. Stock options and other incentive plans
enable personnel to participate in the company's success, without increasing
cash compensation. The chance to acquire stock in the company they work for also
makes employees take a more long term view of the company.
PERSONAL WEALTH. Not insignificantly, a public offering can enhance your net
worth. Even if you do not realize immediate profit by selling a portion of your
existing stock during the initial offering, you can use publicly traded stock as
collateral to secure borrowings for other investments.
THE DISADVANTAGES
There are also some very significant disadvantages of going public that should
be weighed against the many advantages:
EXPENSE. The cost of going public, via the Initial Public Offering method is
substantial, both initially and on an ongoing basis. As for the initial costs,
the underwriter's commission can run as high as 10% to 14% or more of the total
offering. In addition, you can incur significant out of pocket expenses, such as
attorneys and accountants, for even a small offering. There are also ongoing
expenses associated with periodic public reporting and other requirements.
MANAGEMENT DEMANDS. Top management must be available to shareholders, brokers,
securities analysts and the press - all of whom want up to date information
about company progress. Executives must also be involved in preparing written
information about financial results and other company matters that must be
reported to the Shareholders and the Securities and Exchange Commission.
DISCLOSURE OF INFORMATION. As a publicly held corporation, your company's
operations and financial situation are open to public scrutiny. Information
concerning the company, officers, directors and certain shareholders -
information not ordinarily disclosed by privately held companies - is suddenly
available to competitors, customers, employees and others. Information such as
your company's sales, profits and the salaries and perquisites of your officers
and directors must be disclosed not only when you initially go public, but also
on a continuing basis thereafter.
PRESSURE TO MAINTAIN GROWTH PATTERN. There is considerable internal and external
pressure to maintain the growth rate you have established. If your sales or
earnings deviate from the established trend, shareholders may become
apprehensive and sell their stock, driving down its price. In addition, you will
have to begin reporting operating results quarterly. People will evaluate the
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company quarterly rather than annually. This will intensify the pressure and
shorten your planning and operating horizons significantly. The pressure may
tempt you to make short-term decision that could have a harmful long-term effect
on the company.
LOSS OF CONTROL. If a sufficiently large portion of your stock is sold to the
public, you may be threatened with the loss of control of the company. And once
your company is publicly held, the potential exists for further dilution of your
control through subsequent public offerings and acquisitions.
THE ALTERNATIVES
While Intrepid is not in the business of arranging or providing debt financing,
it does realize that companies typically make use of a variety of financing
options before they even consider going public. Generally speaking, these loan
and investment options should be explored, and where appropriate, exploited
fully before a company decides on a public offering.
The most common way to raise additional capital, of course, is to borrow. Loans
can be obtained from institutions such as banks, asset-based lenders, and
equipment leasing companies. The advantages of loans are that they are
relatively simple to arrange and will not dilute your ownership.
Exclusive reliance on debt rather than equity can be a high-risk strategy for
growth. In incurring debt, you subject your company to a firm obligation. A
downturn in your business or an increase in interest rates could make it
difficult to meet your payments. Many companies have faltered in this way. The
risk of debt is reflected in the fact that, generally the more highly a company
is leveraged the lower is its price-earnings ratio.
EVALUATING THE ALTERNATIVES
Clearly, the new complexity, when added to the complexity built into the process
of going public, makes for an immense challenge for the company considering
going public. Never have the possibilities for missteps been greater. And never
has the requirement of receiving expert advice been more important.
For all the glamour associated with going public, the fact remains that the
decision to do so should be based on hard business realities. The decision
depends on the answers to two basic questions:
Have you exhausted other financing alternatives?
Do the advantages of going public outweigh the disadvantages?
As the owner or major shareholder of a private corporation you must weigh the
advantages of going public in light of the plans and goals you have for yourself
and your company. You should consider the alternatives and discuss the matter
thoroughly with your attorneys, your independent accountants and other
professional advisors. Going public is not an easy task.
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PRIVATE PLACEMENTS
Any company, whether private or publicly held, is capable of benefiting from a
private placement. If the company receiving the private placement money is
private, it would need to have a plan to go public, because the exit strategy
for a private placement investor is normally conversion of his private placement
shares to publicly held shares. Intrepid has sources of introductions for
pursuing the funding of private placements.
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ATTORNEY DISCLOSURE AND
SPECIAL RELATIONSHIP AGREEMENT
WILLIAM STOCKER
ATTORNEY AT LAW
THIS AGREEMENT is made by and between Intrepid International, Ltd., a Nevada
Corporation, (hereafter Intrepid ), and Oasis Entertainment's Fourth Movie
Project, Inc. a Nevada Corporation, (hereafter Intrepid-Client ), and William
Stocker, Intrepid's General Counsel, and dated April 6. In consideration of the
mutual promises contained herein, and on the terms and conditions herein set
forth, the parties agree as follows:
A. SUMMARY.
Oasis Entertainment's Fourth Movie Project, Inc. has employed Intrepid
International, Ltd. to perform certain financial services to Client, some of
which services are to be provided for Client, and in the Client's name, by
attorneys with established and continuing relationship to Intrepid. The purpose
of this agreement is to provide full written disclosure, and to define special
character of both the ostensible and actual relationships between the parties.
William Stocker is actually General Counsel of Intrepid International, Ltd.
William Stocker will be authorized by this agreement to act as ostensible
Special Securities Counsel for Oasis Entertainment's Fourth Movie Project, Inc.
.
B. RECITALS
1. INTREPID RETAINER AGREEMENT. Intrepid International, Ltd. is or
will be hereby retained as financial services consultants for the
Intrepid-Client, pursuant to that certain Financial Services Consulting
Agreement of even date herewith. Among the services contemplated to be provided
by that Agreement are the services of its General Counsel William Stocker,
attorney at law, as Special Securities Counsel for the Intrepid-Client.
2. INTREPID GENERAL COUNSEL. William Stocker, attorney at law, is General
Counsel to Intrepid, first and foremost and always, and this paramount status
and relationship has been and is hereby fully disclosed, in connection with the
Intrepid-Client's consideration of the potential services of William Stocker as
Special Counsel with Limited Authority, in connection with, and only in
connection with the services requested and agreed to between Intrepid and the
Intrepid-Client.
3. DEFINITION OF SPECIAL COUNSEL WITH LIMITED AUTHORITY . As used in this
Attorney Disclosure Agreement, this expression shall have the following meaning,
consistently and without exception: Intrepid General Counsel is authorized,
where appropriate to employ the designation Special Counsel or Special
Securities Counsel for the Intrepid-Client, in connection with, and only in
connection with services to and for the Intrepid-Client requested by the
Intrepid-Client to be performed by Intrepid pursuant to the Financial Services
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Consulting Agreement of even date herewith. Intrepid General Counsel, as between
such Counsel and the Intrepid-Client, is not Intrepid-Client's Counsel, nor
counsel to the Intrepid-Client generally, or in any other manner than specified
in this definition. Special Counsel will not take action which is not authorized
by the Intrepid-Client nor represent to any person any general authority to
speak for or bind the Intrepid-Client in any manner.
4. INTREPID-CLIENT'S RIGHT TO DECLINE THE RELATIONSHIP. The
Intrepid-Client has been informed, and is informed hereby, that the
Intrepid-Client is not required to join in the special relationship disclosed
and defined herein. Intrepid-Client may employ or require its own counsel or
independent counsel for any and all purposes at its expense and in addition to
its obligations to Intrepid. The Intrepid-Client is advised to retain its own
counsel, as appropriate, to review and advise the Intrepid-Client as to any
matter arising from its relationship to Intrepid or Intrepid's Counsel.
5. MANAGEMENT'S PREFERENCE. It is the desire of sophisticated management
that the unnecessary expense of cumulative counsel with respect to purely
technical matters is not warranted, necessary or appropriate, with respect to
the limited authority and scope of the Special Counsel relationship, as defined,
and that no conflict of interest exists or is likely to arise from the strict
and precise observance of that relationship as defined. Accordingly management
understands, accepts and affirmatively requests such an arrangement.
C. SPECIAL COUNSEL AGREEMENT
1. SPECIAL COUNSEL. The Intrepid-Client and Intrepid Counsel hereby agree
and adopt that special technical relationship of Special Counsel with Limited
Authority as defined hereinabove, for the sole and separate purpose of allowing
Intrepid Counsel to perform services appropriate to the services of Intrepid
requested by the Intrepid-Client.
2. BILLINGS. Special Counsel (Intrepid's Counsel) shall invoice and bill
applicable time and services to Intrepid, separately with respect to matters
applicable to this Intrepid-Client. Time shall be billable at $300.00/hr, and
such incidental secretarial services shall be billable at $100.00/hr, as may be
reasonably and necessarily performed by its secretary. Additional services may
be performed by subcontractor attorneys, subject to arrangements approved by the
Intrepid-Client in advance. Intrepid shall be responsible, as between Intrepid
and its counsel, for the compensation and discharge of its Counsel's billings.
Intrepid shall include Counsel's segregated billings along with its own, and, as
between Intrepid and the Intrepid-Client, the Intrepid-Client shall be
responsible to Intrepid for the total of its own and Counsel's billings. Certain
special minimum fixed fees shall apply to Legal Opinions: (a) Opinions for the
Issuance of free trading stock, $2,500.00; Opinions to remove restriction on
issued restricted securities; $2,000.00; Opinions to issue restricted
securities, as defined in Rule 144(a), $1,000.00.
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3. TERMINATION. The terms of this agreement may be terminate by either
Intrepid-Client or Special Counsel at any time upon written or other reasonable
notice to the other.
4. MISCELLANEOUS This agreement sets forth the entire agreement and
understanding between the parties and supersedes all prior discussions,
agreements and understandings, if any, of any and every kind and nature, between
them. This agreement is made and shall be construed and interpreted according to
the laws of the Intrepid-Client's place of Incorporation if that be Nevada or
Texas, and if not, pursuant to the laws of the State of Nevada.
ACCORDINGLY the parties cause this agreement to be signed by their duly
authorized representative, as of the date written below.
Intrepid International, Ltd.
by
/s/ Kirt W. James /s/ William Stocker
Kirt W. James, President William Stocker
attorney at law
THE ABOVE IS UNDERSTOOD AND AGREED TO and I state under the penalties of perjury
that I am authorized to execute this letter agreement:
Oasis Entertainment's Fourth Movie Project, Inc.
Date: April 6, 1998 By:/s/ Kirt W. James
Kirt W. James, President
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ATTORNEY DISCLOSURE AND
SPECIAL RELATIONSHIP AGREEMENT
WILLIAM STOCKER
ATTORNEY AT LAW
THIS AGREEMENT is made by and between Intrepid International, Ltd., a Nevada
Corporation, (hereafter Intrepid ), and Oasis Entertainment's Fourth Movie
Project, Inc. a Nevada Corporation, (hereafter Intrepid-Client ), and William
Stocker, Intrepid's General Counsel, and dated April 6. In consideration of the
mutual promises contained herein, and on the terms and conditions herein set
forth, the parties agree as follows:
A. SUMMARY.
Oasis Entertainment's Fourth Movie Project, Inc. has employed Intrepid
International, Ltd. to perform certain financial services to Client, some of
which services are to be provided for Client, and in the Client's name, by
attorneys with established and continuing relationship to Intrepid. The purpose
of this agreement is to provide full written disclosure, and to define the
special character of both the ostensible and actual relationships between the
parties.
William Stocker is actually General Counsel of Intrepid International, Ltd.
William Stocker will be authorized by this agreement to act as ostensible
General Counsel for Oasis Entertainment's Fourth Movie Project, Inc. for a
limited time and with limited authority.
B. RECITALS
1. INTREPID RETAINER AGREEMENT. Intrepid International, Ltd. is or
will be hereby retained as financial services consultants for the
Intrepid-Client, pursuant to that certain Financial Services Consulting
Agreement of even date herewith. Among the services contemplated to be provided
by that Agreement are the continuing services of its General Counsel William
Stocker, attorney at law, as Counsel for the Intrepid-Client.
2. INTREPID GENERAL COUNSEL. William Stocker, attorney at law, is General
Counsel to Intrepid, first and foremost and always, and this paramount status
and relationship has been and is hereby fully disclosed, in connection with the
Intrepid-Client's consideration of the potential continuing services of William
Stocker as General Counsel with Limited Authority, in connection with, and only
in connection with the services requested and agreed to between Intrepid and the
Intrepid-Client, for an agreed transitional period of 60 days.
3. DEFINITION OF GENERAL COUNSEL WITH LIMITED AUTHORITY . As used in this
Attorney Disclosure Agreement, this expression shall have the following meaning,
consistently and without exception: Intrepid General Counsel is authorized,
where appropriate to employ the designation General Counsel or Corporate
Counsel for the Intrepid-Client, in connection with, and only in connection
with services to and for the Intrepid-Client requested by the Intrepid-Client to
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be performed by Intrepid pursuant to the Financial Services Consulting Agreement
of even date herewith. Intrepid General Counsel, acting as Ostensible General
Counsel for Intrepid Client shall focus primarily on reorganizational and
transitional matters. Intrepid Counsel acting as General Counsel to the Client
will not take action which is not authorized by the Intrepid-Client and Intrepid
Jointly, nor represent to any person any general authority to speak for or bind
the Intrepid-Client in any manner not approved by Intrepid-Client and Intrepid
Jointly. This relationship is intended to exist for 60 days, unless extended by
the parties.
4. INTREPID-CLIENT'S RIGHT TO DECLINE THE RELATIONSHIP. The
Intrepid-Client has been informed, and is informed hereby, that the
Intrepid-Client is not required to join in the special relationship disclosed
and defined herein. Intrepid-Client may employ or require its own counsel or
independent counsel for any and all purposes at its expense and in addition to
its obligations to Intrepid. The Intrepid-Client is advised to retain its own
counsel, as appropriate, to review and advise the Intrepid-Client as to any
matter arising from its relationship to Intrepid or Intrepid's Counsel.
5. MANAGEMENT'S PREFERENCE. It is the desire of sophisticated management
that the unnecessary expense of cumulative counsel with respect to purely
technical matters is not warranted, necessary or appropriate, with respect to
the limited authority and scope of the Ostensible Counsel relationship, as
defined, and that no conflict of interest exists or is likely to arise from the
strict and precise observance of that relationship as defined. Accordingly
management understands, accepts and affirmatively requests such an arrangement.
A. OSTENSIBLE GENERAL COUNSEL AGREEMENT
1. OSTENSIBLE COUNSEL. The Intrepid-Client and Intrepid Counsel hereby
agree and adopt that special technical relationship of Ostensible General
Counsel with Limited Authority as defined hereinabove, for the sole and separate
purpose of allowing Intrepid Counsel to perform services appropriate to the
services of Intrepid requested by the Intrepid-Client.
2. BILLINGS. Special Counsel (Intrepid's Counsel) shall invoice and bill
applicable time and services to Intrepid, separately with respect to matters
applicable to this Intrepid-Client. Time shall be billable at $300.00/hr, and
such incidental secretarial services shall be billable at $100.00/hr, as may be
reasonably and necessarily performed by its secretary. Additional services may
be performed by subcontractor attorneys, subject to arrangements approved by the
Intrepid-Client in advance. Intrepid shall be responsible, as between Intrepid
and its counsel, for the compensation and discharge of its Counsel's billings.
Intrepid shall include Counsel's segregated billings along with its own, and, as
between Intrepid and the Intrepid-Client, the Intrepid-Client shall be
responsible to Intrepid for the total of its own and Counsel's billings.
3. TERMINATION. The terms of this agreement may be terminate by either
Intrepid-Client or by Ostensible at any time upon written or other reasonable
notice to the other.
4. MISCELLANEOUS This agreement sets forth the entire agreement and
understanding between the parties and supersedes all prior discussions,
agreements and understandings, if any, of any and every kind and nature, between
them. This agreement is made and shall be construed and interpreted according to
the laws of the Intrepid-Client's place of Incorporation if that be Nevada or
Texas, and if not, pursuant to the laws of the State of Nevada.
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ACCORDINGLY the parties cause this agreement to be signed by their duly
authorized representative, as of the date written below.
Intrepid International, Ltd.
by
/s/ Kirt W. James /s/ William Stocker
Kirt W. James, President William Stocker
attorney at law
THE ABOVE IS UNDERSTOOD AND AGREED TO and I state under the penalties of perjury
that I am authorized to execute this letter agreement:
Oasis Entertainment's Fourth Movie Project, Inc.
Date: April 6, 1998 By:/s/ Kirt W. James
Kirt W. James, President
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ATTORNEY DISCLOSURE AND
SPECIAL RELATIONSHIP AGREEMENT
KARL E. RODRIGUEZ
ATTORNEY AT LAW
THIS AGREEMENT is made by and between Intrepid International, Ltd., a Nevada
Corporation, (hereafter Intrepid ), and Oasis Entertainment's Fourth Movie
Project, Inc. a Nevada Corporation, (hereafter Intrepid-Client ), and Karl E.
Rodriguez, Exim International, Inc.'s General Counsel, and dated April 6. In
consideration of the mutual promises contained herein, and on the terms and
conditions herein set forth, the parties agree as follows:
A. SUMMARY.
Oasis Entertainment's Fourth Movie Project, Inc. has employed Intrepid
International, Ltd. to perform certain financial services to Client, some of
which services are to be provided for Client, and in the Client's name, by
attorneys with established and continuing relationship to Intrepid. The purpose
of this agreement is to provide full written disclosure, and to define special
character of both the ostensible and actual relationships between the parties.
Karl E. Rodriguez is actually General Counsel of Exim International, Inc.
Karl E. Rodriguez will be authorized by this agreement to act as ostensible
Special Transactional Counsel for Oasis Entertainment's Fourth Movie Project,
Inc. .
A. RECITALS
1. INTREPID RETAINER AGREEMENT. Intrepid International, Ltd. is or
will be hereby retained as financial services consultants for the
Intrepid-Client, pursuant to that certain Financial Services Consulting
Agreement of even date herewith. Among the services contemplated to be provided
by that Agreement are the services of Karl E. Rodriguez, attorney at law, as
Special Transactional Counsel for the Intrepid-Client.
2. EXIM INTERNATIONAL, INC., is a financial consulting firm, not a broker,
dealer or registered investment advisor, a principal consultant to Intrepid
International, Ltd.
3. EXIM GENERAL COUNSEL. Karl E. Rodriguez, attorney at law, is General
Counsel to Intrepid's Consultant, Exim International, Inc., first and foremost
and always, and this paramount status and relationship has been and is hereby
fully disclosed, in connection with the Intrepid-Client's consideration of the
potential services of Karl E. Rodriguez as Special Counsel with Limited
Authority, in connection with, and only in connection with the services
requested and agreed to between Intrepid and the Intrepid-Client.
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4. DEFINITION OF SPECIAL COUNSEL WITH LIMITED AUTHORITY . As used in this
Attorney Disclosure Agreement, this expression shall have the following meaning,
consistently and without exception: Exim General Counsel Karl E. Rodriguez is
authorized, where appropriate to employ the designation Special Counsel or
Special Transactional Counsel for the Intrepid-Client, in connection with, and
only in connection with services to and for the Intrepid-Client requested by the
Intrepid-Client to be performed by Intrepid pursuant to the Financial Services
Consulting Agreement of even date herewith. Exim General Counsel, Karl E.
Rodriguez as between such Counsel and the Intrepid-Client, is not
Intrepid-Client's Counsel, nor counsel to the Intrepid-Client generally, or in
any other manner than specified in this definition. Special Counsel will not
take action which is not authorized by the Intrepid-Client nor represent to any
person any general authority to speak for or bind the Intrepid-Client in any
manner.
5. INTREPID-CLIENT'S RIGHT TO DECLINE THE RELATIONSHIP. The
Intrepid-Client has been informed, and is informed hereby, that the
Intrepid-Client is not required to join in the special relationship disclosed
and defined herein. Intrepid-Client may employ or require its own counsel or
independent counsel for any and all purposes at its expense and in addition to
its obligations to Intrepid. The Intrepid-Client is advised to retain its own
counsel, as it may deem appropriate, to review and advise the Intrepid-Client as
to any matter arising from its relationship to Intrepid or Exim's Counsel.
6. MANAGEMENT'S PREFERENCE. It is the desire of sophisticated management
that the unnecessary expense of cumulative counsel with respect to purely
technical matters is not warranted, necessary or appropriate, with respect to
the limited authority and scope of the Special Counsel relationship, as defined,
and that no conflict of interest exists or is likely to arise from the strict
and precise observance of that relationship as defined. Accordingly management
understands, accepts and affirmatively requests such an arrangement.
B. SPECIAL COUNSEL AGREEMENT
1. SPECIAL COUNSEL. The Intrepid-Client and Intrepid Counsel hereby agree
and adopt that special technical relationship of Special Counsel with Limited
Authority as defined hereinabove, for the sole and separate purpose of allowing
Intrepid Counsel to perform services appropriate to the services of Intrepid
requested by the Intrepid-Client.
2. BILLINGS. Special Counsel (Exim's Counsel) shall invoice and bill
applicable time and services to Intrepid, separately with respect to matters
applicable to this Intrepid-Client. Time shall be billable at $300.00/hr, and
such incidental secretarial services shall be billable at $100.00/hr, as may be
reasonably and necessarily performed by its secretary. Additional services may
be performed by subcontractor attorneys, subject to arrangements approved by the
Intrepid-Client in advance. Intrepid shall be responsible, as between Intrepid
and its counsel, for the compensation and discharge of its Counsel's billings.
Intrepid shall include Counsel's segregated billings along with its own, and, as
between Intrepid and the Intrepid-Client, the Intrepid-Client shall be
responsible to Intrepid for the total of its own and Counsel's billings. Certain
special minimum fixed fees shall apply to Legal Opinions: (a) Opinions for the
Issuance of free trading stock, $2,500.00; Opinions to remove restriction on
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issued restricted securities; $2,000.00; Opinions to issue restricted
securities, as defined in Rule 144(a), $1,000.00.
3. TERMINATION. The terms of this agreement may be terminate by either
Intrepid-Client or Special Counsel at any time upon written or other reasonable
notice to the other.
4. MISCELLANEOUS This agreement sets forth the entire agreement and
understanding between the parties and supersedes all prior discussions,
agreements and understandings, if any, of any and every kind and nature, between
them. This agreement is made and shall be construed and interpreted according to
the laws of the Intrepid-Client's place of Incorporation if that be Nevada or
Texas, and if not, pursuant to the laws of the State of Nevada.
ACCORDINGLY the parties cause this agreement to be signed by their duly
authorized representative, as of the date written below.
Intrepid International, Ltd.
by
/s/ Kirt W. James /s/ Karl E. Rodriguez
Kirt W. James, President Karl E. Rodriguez
attorney at law
THE ABOVE IS UNDERSTOOD AND AGREED TO and I state under the penalties of perjury
that I am authorized to execute this letter agreement:
Oasis Entertainment's Fourth Movie Project, Inc.
Date: April 6, 1998 By:/s/ Kirt W. James
Kirt W. James, President
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