SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement [ ] Confidential, For Use of
the Commission Only (as
permitted by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Under Rule 14a-12
AMERICAN URANIUM, INC.
(Name of Registrant as Specified in Its Charter)
Payment of Filing Fee (check the appropriate box):
[X] No fee required.
[ ] Fee computed per Exchange Act Rules 14a-6(i)(1) and 0-11.
[ ] Fee paid previously with preliminary materials:
NOTICE OF 1999 ANNUAL MEETING OF STOCKHOLDERS
June 19, 2000
Dear Stockholder:
It is my pleasure to invite you to the 1999 Annual Meeting
of the Stockholders of American Uranium, Inc., which will be held on
June 19, 2000, at 1:00 p.m., Eastern Standard Time, at certain
conference facilities located at 121 Richmond Street West, 7th Floor
Toronto, Ontario Canada.
The purposes of the meeting will be to:
(a) Ratify the selection of Arthur Andersen LLP, as
independent auditor for the fiscal year ending December 31, 2000;
(b) Consider and act upon a proposal to change the
Company's state of incorporation from New Jersey to Florida by means
of a merger of the Company into a wholly-owned Florida subsidiary of
the Company, American Uranium Reincorporation, Inc., as described in
the accompanying Proxy Statement;
(c) Elect three directors to our Board of Directors; and
(d) Transact such other business as may properly come
before the meeting, or any adjournment or postponement of the meeting.
Only stockholders of record at the close of business on May 19,
2000 are entitled to vote at the meeting, or any adjournment or
postponement of the meeting. We are mailing proxy solicitation
material to our stockholders commencing on or about June 1, 2000.
We must receive your proxy on or before June 13, 2000, in order for
your proxy to be voted at the meeting.
You are invited to attend the meeting. Regardless of whether
you expect to attend the meeting in person, we urge you to read the
attached proxy statement and sign and date the accompanying proxy
card and return it in the enclosed postage-prepaid envelope. It is
important that your shares be represented at the meeting.
Sincerely,
Glen Akselrod, President and Chief Executive Officer
Toronto, Ontario Canada
May 23, 2000
TABLE OF CONTENTS
GENERAL INFORMATION 1
INFORMATION REGARDING THE MEETING 1
REINCORPORATION IN THE STATE OF FLORIDA 2
APPOINTMENT OF INDEPENDENT AUDITORS 14
ELECTION OF DIRECTORS 15
BOARD AND COMMITTEE MEETINGS 16
DIRECTOR COMPENSATION 16
BENEFICIAL OWNERSHIP 17
COMPENSATION OF EXECUTIVE OFFICERS 18
CERTAIN TRANSACTIONS 19
COMPLIANCE WITH SECTION 16 OF THE SECURITIES EXCHANGE ACT 19
STOCKHOLDER PROPOSALS 19
OTHER MATTERS 20
EXHIBITS:
Exhibit A; Annual Report on Form 10-KSB for the Year Ended
December 31, 1999
Exhibit B; Quarterly report on Form 10-QSB for the period
ended March 31, 2000
Exhibit C; The Merger Agreement
Exhibit D; The Florida Articles
Exhibit E; The Florida Bylaws
Exhibit F; Chapter 11 of the New Jersey Act
GENERAL INFORMATION
We sent you this proxy statement and the enclosed proxy card
because our Board of Directors is soliciting your proxy for use at
our 1999 annual meeting of stockholders. All holders of record on
May 19, 2000 of our shares of common stock are entitled to vote at
the meeting.
This proxy statement, the accompanying proxy card, our latest
Annual Report on Form 10-KSB and our quarterly report on Form 10-QSB
for the period ended March 31, 2000 were first mailed to
stockholders on or about June 1, 2000. Our Annual Report on Form
10-KSB and quarterly report on Form 10-QSB contain the information
required by Rule 14a-3 of the Rules of the Securities and Exchange
Commission, including audited financial statements for our last
completed fiscal year, which ended December 31, 1999, and unaudited
financial statements for the three month period ended March 31,
2000, and are attached to this Proxy as Exhibit A and Exhibit B,
respectively. Those reports should not be regarded as material for
the solicitation of proxies or as a communication by means of which
we are soliciting your proxy with respect to the meeting. We are
incorporating in this proxy statement, by reference, our prior
filings with the Securities and Exchange Commission. If you would
like copies of any of those documents, other than the filings we are
delivering to you in connection with this proxy statement, you can
request (by phone or in writing) copies of them by sending your
request to: American Uranium, Inc., 121 Richmond Street West, 7th
Floor, Toronto, Ontario, Canada M5H 2L3, telephone (416) 203-0010,
attention Glen Akselrod, President. We will not charge you for any
of the copies.
At the meeting, you will be asked to:
- Approve a proposal to change the Company's state of
incorporation from New Jersey to Florida by means of a
merger of the Company into a wholly-owned Florida
subsidiary of the Company, American Uranium
Reincorporation, Inc.; and
- Approve the selection of Arthur Andersen LLP as our
independent auditor for the fiscal year ending December
31, 2000;
- Elect three directors to the Board of Directors; and
- Vote on such other business as may properly come before
the meeting, or any adjournment or postponement of the
meeting.
INFORMATION REGARDING THE MEETING
WHAT MAY I VOTE ON? YOU WILL BE ENTITLED TO VOTE, EITHER IN
PERSON OR BY PROXY, ON:
1. The approval of a proposal to change the Company's
state of incorporation from New Jersey to Florida by means of a
merger of the Company into a wholly-owned Florida subsidiary of the
Company, American Uranium Reincorporation, Inc. (the "Reincorporation")
2. The approval of the appointment of our independent
auditors for 2000;
3. The election of three nominees to serve on our Board
of Directors.
How does the Board of Directors recommend I vote on the
proposals? The Board of Directors recommends a vote FOR approval of
the proposal the Reincorporation; a vote FOR ratification of the
selection of Arthur Andersen LLP. as our independent auditors for
2000; and a vote FOR each of the three nominees to the Board of
Directors.
Who is entitled to vote? Stockholders as of the close of
business on May 19, 2000 (the "Record Date") are entitled to vote at
the meeting.
How do I vote? Sign and date the proxy card you receive with
this proxy statement and return it in the prepaid envelope. If you
return your signed proxy card but do not mark the boxes showing how
you wish to vote, your shares will be voted FOR the four proposals
and in such manner as the named proxies determine with respect to
any other matters addressed at the meeting. You have the right to
revoke your proxy at any time before the meeting by:
- notifying our Corporate Secretary; OR
- voting in person; OR
- returning a later-dated proxy card.
Who will count the votes? We have appointed our corporate
secretary as the inspector of the election. The representative will
count and tabulate the votes.
Is my vote confidential? Your vote will not be disclosed except:
- as needed to permit the inspector of the election to
tabulate and certify the vote;
- as required by law; or
- in limited circumstances, such as a proxy contest in
opposition to the Board of Directors.
Additionally, all comments written on the proxy card or
elsewhere will be forwarded to our management, but your identity
will be kept confidential unless you ask that your name be disclosed.
What shares are included on the proxy card? The shares on your
proxy card represent ALL of your shares. If you do not return your
proxy card, your shares will not be voted.
What does it mean if I get more than one proxy card? If your
shares are registered differently and are in more than one account,
you will receive more than one proxy card. Sign and return all the
proxy cards you receive to ensure that all your shares are voted.
How many shares can vote? As of the record date, May 19, 2000,
9,058,261 shares of common stock were outstanding and entitled to
vote. Each share of common stock is entitled to one vote, voting as
one class. In summary, there were a total of 9,058,261 eligible
votes as of the record date.
What is a "quorum"? A "quorum" is a majority of the outstanding
shares. They may be present at the meeting or represented by
proxy. There must be a quorum for the meeting to be held, and a
proposal must be approved by more than 50% of the shares voting at a
meeting at which there is a quorum to be adopted. The three
nominees for director receiving the highest number of affirmative
votes will be elected as directors. If you submit a properly
executed proxy card, even if you abstain from voting, then you will
be considered part of the quorum. However, abstentions are not
counted in the tally of votes FOR or AGAINST a proposal. We intend
to treat shares referred to as "broker non-votes" (i.e., shares held
by brokers or nominees as to which the broker or nominee indicates
on a proxy that it does not have discretionary authority to vote) as
shares that are present and entitled to vote for purposes of
determining the presence of a quorum. We will not consider broker
non-votes as votes cast either for or against a particular matter.
Who can attend the Annual meeting? All of our stockholders on
May 19, 2000 can attend. Due to limited space in the meeting room,
we are limiting the persons who can attend the meeting to our
stockholders, their representatives, our employees and our directors.
How will voting on any other business be conducted? Although
we do not know of any business to be considered at the meeting other
than the proposals described in this proxy statement, if any other
business is presented at the meeting, your signed proxy card gives
authority to Glen Akselrod, our Chairman, President and Chief
Executive Officer, to vote on those matters at his discretion.
Who are the largest principal shareholders? As of May 19,
2000, several of our stockholders owned more than 5% of our capital
stock. Those stockholders include Uranium Strategies, Inc., Pan
Zone Co. Ltd., Thesis Group, Inc. and New Century Investment
Holdings, Inc.
How much did this proxy solicitation cost? We hired Olde
Monmouth Stock Transfer Co., Inc., an independent third party to
assist us in the distribution of the proxy materials or the
solicitation of votes. We estimate that our costs for those actions
(which will be conducted by Olde Monmouth Stock Transfer Co., Inc.
and our employees, officers and directors) will be approximately
$7,000.00. We will also reimburse brokerage houses and other
custodians, nominees and fiduciaries for their reasonable
out-of-pocket expenses for forwarding the proxy statement and
solicitation materials to our stockholders.
How do I revoke my proxy after I give it? A stockholder giving
a proxy pursuant to this solicitation may revoke it at any time
prior to its exercise at the meeting by delivering to our President
a written notice of revocation, or a duly executed proxy bearing a
later date, or by attending the meeting and voting in person.
Attendance at the meeting will not, however, constitute revocation
of your proxy without your further action. Any written notice
revoking your proxy should be sent to our principal executive
offices addressed as follows: American Uranium, Inc., 121 Richmond
Street West, 7th Floor, Toronto, Ontario, Canada M5H 2L3, telephone
(416) 203-0010, attention Glen Akselrod, President.
REINCORPORATION OF THE COMPANY FROM NEW JERSEY TO FLORIDA
We are asking you approve a proposal to change the Company's
state of incorporation from New Jersey to Florida by means of a
merger of the Company into a wholly-owned Florida subsidiary of the
Company, American Uranium Reincorporation, Inc. ("American Uranium
Florida").
The Board of Directors has approved an Agreement and Plan of
Merger (the "Merger Agreement") between the Company and American
Uranium Florida. We have attached a copy of the Merger Agreement as
Exhibit C to this Proxy Statement. The Merger Agreement provides
that the Company will merge with and into American Uranium Florida
(the "Merger"). Upon shareholder approval of the Merger Agreement,
the Company's state of incorporation will change from New Jersey to
Florida (the "Reincorporation"). American Uranium Florida is a
wholly-owned nonoperating subsidiary of the Company recently
incorporated in Florida solely for purposes of effecting the
Reincorporation.
REASONS FOR THE REINCORPORATION
The Company was incorporated under New Jersey law as a
subsidiary of People Ridesharing Systems, Inc., a company which
filed for reorganization under Chapter 11 of the Bankruptcy Act. As
a result of the bankruptcy of People Ridesharing Systems, Inc. the
stock ownership of the Company was distributed to various parties,
and the parent/subsidiary relationship between the Company and
People Ridesharing Systems, Inc. ended. Other than the prior
relationship with People Ridesharing Systems, Inc., the Company had
no reason to have selected New Jersey as its legal residence, and
the Company's historical ties to New Jersey no longer appear to
management to be decisive in determining the best jurisdiction to
fulfill the business needs of the Company.
The Board of Directors believes that the Florida Business
Corporation Act (the "Florida Act") will meet the Company's business
needs. The Florida Act is a comprehensive, modern and flexible
statute based on the Revised Model Business Corporation Act. For
the most part, it provides the flexibility in management of a
corporation and in the conduct of various business transactions.
Based upon the foregoing, the Board of Directors has determined that
it would be in the best interests of the Company and its
shareholders to reincorporate in Florida, through a merger with its
wholly-owned subsidiary, American Uranium Florida.
THE MERGER
GENERAL
The Reincorporation will be effected by merging the Company
into American Uranium Florida, which will be the surviving
corporation after the Merger. The Reincorporation will not result
in any material change in the name, business, assets or financial
position of the Company or in the persons who constitute the Board
of Directors (subject to the election by the Shareholders of the
nominees for the Board of Directors described in this Proxy
Statement). The terms and conditions of the Merger are set forth in
the Merger Agreement.
Upon the effective date of the Merger (the "Effective Date"):
(a) the Company will cease to exist; (b) American Uranium Florida
will continue the current operations of the Company and will succeed
to all of the assets and assume all of the liabilities of the
Company; and (c) each outstanding share of Common Stock of the
Company will be automatically converted into one share of Common
Stock, $.001 par value per share, of American Uranium Florida (the
"American Uranium Florida Common Stock"). Outstanding options or
warrants to purchase the Common Stock of the Company will
automatically be converted into options or warrants to purchase
American Uranium Florida Common Stock.
After the Effective Date, the Board of Directors of American
Uranium Florida will be comprised of the persons elected to the
Board of Directors of the Company at this Annual Meeting, and the
persons who are currently serving as executive officers of the
Company will continue to serve in the same capacities for American
Uranium Florida.
After the Effective Date, the rights of shareholders and the
Company's corporate affairs will be governed by the Florida Act and
by the Articles of Incorporation (the "Florida Articles") and the
Bylaws (the "Florida Bylaws") of American Uranium Florida, instead
of the Business Corporation Act of New Jersey (the "New Jersey Act")
and the Certificate of Incorporation (the "New Jersey Certificate")
and the By-Laws (the "New Jersey Bylaws") of the Company. Certain
changes in the rights of shareholders of the Company will result
under the Florida Act and the Florida Articles and the Florida
Bylaws. We have attached a copy of the Florida Articles and the
Florida Bylaws as Exhibit D and Exhibit E, repsectively to this
Proxy Statement.
After the Effective Date, each outstanding certificate
representing shares of Common Stock of the Company will be deemed to
represent a like number of shares of American Uranium Florida Common
Stock.
IT WILL NOT BE NECESSARY FOR HOLDERS OF THE COMMON STOCK OF THE
COMPANY TO SURRENDER THEIR CERTIFICATES FOR NEW CERTIFICATES
REPRESENTING AMERICAN URANIUM FLORIDA COMMON STOCK.
The Reincorporation will become effective upon the filing of
the requisite merger documents in Florida and New Jersey, which
filings are expected to be made as soon as practicable following
shareholder approval. The Merger Agreement provides, however, that
Merger may be abandoned by the Boards of Directors of the Company
and American Uranium Florida at any time prior to the Effective Date
(whether before or after shareholder approval). In addition, the
Boards of Directors of the Company and American Uranium Florida may
amend the Merger Agreement at any time prior to the Effective Date,
provided that any amendment made subsequent to shareholder approval
may not alter or change the amount or kind of shares to be received
in exchange for or on conversion of all or any of the shares of the
Company, alter or change any term of the Florida Articles or alter
or change any terms and conditions of the Merger Agreement if such
alteration or change would adversely affect the holders of the
Common Stock of the Company.
SECURITIES ACT CONSEQUENCES
After the Reincorporation, American Uranium Florida will be a
publicly held company and American Uranium Florida Common Stock will
continue to be quoted on the over-the-counter market, and the
delivery of existing stock certificates evidencing the Common Stock
of the Company will constitute "good delivery" of the shares of
American Uranium Florida Common Stock in stock transactions effected
after the Merger. The shares of American Uranium Florida Common
Stock to be issued in exchange for shares of the Common Stock of the
Company are not being registered under the Securities Act of 1933
(the "Securities Act") in reliance upon an exemption therefrom.
Shareholders whose stock in the Company is freely tradable before
the Reincorporation will own freely tradable shares of American
Uranium Florida. Shareholders holding restricted securities of the
Company will be subject to the same restrictions on transfer as
those to which their present shares of Common Stock of the Company
are subject. For purposes of computing compliance with the holding
period of Rule 144 under the Securities Act, shareholders will be
deemed to have acquired their shares in American Uranium Florida on
the date they acquired their shares of Common Stock of the Company.
In summary, American Uranium Florida and its stockholders will be in
the same respective position under the registration provisions of
the Securities Act after the Reincorporation as were the Company and
its shareholders prior to the Reincorporation.
COMPARISON OF THE RIGHTS OF HOLDERS OF THE COMMON STOCK OF THE
COMPANY AND THE AMERICAN URANIUM FLORIDA COMMON STOCK
Although it is not practical to compare all of the differences
between (a) the New Jersey Act and the New Jersey Certificate and
the New Jersey Bylaws and (b) Florida Act and the Florida Articles
and the Florida Bylaws, the following is a summary of differences
that we believe may significantly affect the rights of our
stockholders. This summary is not intended to be relied upon as an
exhaustive list of all differences or a complete description of the
differences, and is qualified in its entirety by reference to the
New Jersey Act, the Florida Act, the New Jersey Certificate, the
Florida Articles, the New Jersey Bylaws and the Florida Bylaws.
DIVIDENDS AND REPURCHASES.
Under the New Jersey Act, a corporation may make distributions
on or repurchase shares of stock if, after paying the dividend or
repurchasing the shares, the corporation would be able to pay its
debts as they become due in the usual course of business, or the
corporation's total assets would be more than its total liabilities.
The New Jersey standard also permits distributions and redemptions
unless the corporation is insolvent or would thereby become
insolvent. Such dividends or distributions may be made out of
surplus only, except in the case of dissolution. Under New Jersey
Act, surplus means the excess of net assets of a corporation over
its stated capital.
Under the Florida Act, a corporation may make distributions to
stockholders (subject to any restrictions contained in the
corporation's charter) as long as, after giving effect to the
distribution, (a) the corporation will be able to pay its debts as
they become due in the usual course of business and (b) the
corporation's total assets will not be less than the sum of its
total liabilities plus (unless the charter permits otherwise) the
amount that would be needed, if the corporation were to be dissolved
at the time of the distribution, to satisfy the preferential rights
upon dissolution of stockholders whose preferential rights are
superior to those receiving the distribution. Pursuant to the
Florida Act, a corporation's repurchase of its own capital stock is
deemed to be a distribution.
SPECIAL MEETINGS.
Under the New Jersey Act, special meetings of shareholders may
be called by the president or the board, or by such other officers
or directors. The New Jersey Act also provides that upon
application of the holders of not less than 10% of all shares
entitled to vote at a meeting, the Superior Court may in a summary
manner, for good cause shown, order a special meeting of
shareholders to be called and held. At any meeting ordered by the
Superior Court, a quorum consists of all shareholders present in
person or by proxy.
Under the Florida Act, special meetings of the stockholders may
be called by the Board of Directors or by such persons as may be
authorized by the articles of incorporation or the bylaws. In
addition, the Florida Act permits the holders of not less than 10%
of all votes entitled to be cast on any issue (unless a greater
percentage, not to exceed 50%, is specified in the articles of
incorporation) to call a special meeting.
Both the Florida Bylaws and the New Jersey Bylaws, provide that
special meetings may be called by the Board of Directors, by the
President or by any officer instructed by the Board of Directors to
call the meeting.
QUORUM FOR STOCKHOLDER MEETINGS.
Under the New Jersey Act unless otherwise provided in a
corporation's articles of incorporation, a majority of shares
entitled to vote on a matter constitutes a quorum at a meeting of
stockholders.
Under the Florida Act, unless otherwise provided in a
corporation's articles of incorporation, a majority of shares
entitled to vote on a matter constitutes a quorum at a meeting of
stockholders, but in no event may a quorum consist of less than
one-third of the shares entitled to vote on such matter.
Neither the New Jersey Certificate nor the Florida Articles
vary the statutory requirements of the New Jersey Act or the Florida
Act.
MERGER WITH SUBSIDIARY.
Under the New Jersey Act, a parent corporation may merge with
its subsidiary, without stockholder approval, where the parent
corporation owns at least 90% of the outstanding shares of each
class of capital stock of its subsidiary.
Under the Florida Act, a parent corporation may merge with its
subsidiary, without stockholder approval, where the parent
corporation owns at least 80% of the outstanding shares of each
class of capital stock of its subsidiary.
VACANCIES ON THE BOARD OF DIRECTORS.
Under the New Jersey Act, a vacancy on the board of directors
generally may be filled by a majority of the remaining directors
even though less than a quorum of the board or in the manner
specified in a corporation's certificate of incorporation or
by-laws. Neither the New Jersey Certificate nor the New Jersey
Bylaws provide otherwise.
Under the Florida Act, a vacancy on the board of directors may
be filled by an affirmative vote of a majority of the remaining
directors or by the shareholders, unless the articles of
incorporation provide otherwise. The Florida Articles do not
provide otherwise.
CORPORATE CONTROL PROVISIONS.
The New Jersey Act has includes the New Jersey Shareholders
Protection Act (the "Anti-takeover Act"). The Anti-takeover Act
prohibits certain types of transactions involving a New Jersey
corporation having its principal executive offices and significant
business operations located in New Jersey and certain present or
past beneficial owners of 10% or more of such corporation's voting
stock ("Interested Shareholders") for a period of five years
following the date upon which the Interested Shareholder first
became such (the "Stock Acquisition Date"), unless prior to such
date, the transaction was approved by the board of directors of the
corporation. This Anti-takeover Act also regulates transactions
permitted after such five-year period.
The Florida Act contains a provision governing "affiliated
transactions, but permits a Florida corporation to exempt itself
from the application of such provision. The Florida Act provides
that an "affiliated transaction" with an "interested shareholder"
must generally be approved by the affirmative vote of the holders of
two-thirds of the voting shares, other than the shares owned by the
interested shareholder. An interested shareholder is any person who
is the beneficial owner of 10% or more of the outstanding voting
stock of the corporation. The transactions covered by the statute
include, with certain exceptions: (a) mergers and consolidations to
which the corporation and the interested shareholder are parties,
(b) sales or other dispositions of substantial amounts of the
corporation's assets to the interested shareholder, (c) issuances by
the corporation of substantial amounts of its securities to the
interested shareholder, (d) the adoption of any plan for the
liquidation or dissolution of the corporation proposed by or
pursuant to an arrangement with the interested shareholder, (e) any
reclassification of the corporation's securities that has the effect
of substantially increasing the percentage of outstanding voting
shares of the corporation beneficially owned by the interested
shareholder, and (f) the receipt by the interested shareholder of
certain loans or other financial assistance from the corporation.
The two-thirds approval requirement does not apply if, among
other things: (a) the transaction has been approved by a majority of
the corporation's disinterested directors (as defined in the
statute), (b) the interested shareholder has been the beneficial
owner of at least 80% of the corporation's outstanding voting shares
for at least five years preceding the transaction, (c) the
interested shareholder is the beneficial owner of at least 90% of
the outstanding voting shares, (d) the corporation has not had more
than 300 shareholders of record at any time during the preceding
three years, or (e) certain fair price and procedural requirements
are satisfied.
As permitted by the Florida Act, the Florida Articles contain
provisions electing to be exempt from this provision.
The Florida Act also has a provision governing "control share
acquisitions." The control share acquisition provision of the
Florida Act provides that a person who acquires shares in an issuing
public corporation in excess of certain specified thresholds will
generally not have any voting rights with respect to such shares
unless such voting rights are approved by a majority of the shares
entitled to vote, excluding the interested shares. The thresholds
specified in the Florida Act are the acquisition of a number of
shares representing: (a) 20% or more, but less than 33% of the
voting power of the corporation, (b) 33% or more but less than a
majority of the voting power of the corporation, or (c) a majority
or more of the voting power of the corporation.
This provision does not apply if, among other things, the
acquisition is: (a) approved by the corporation's board of
directors, (b) pursuant to a pledge or other security interest
created in good faith and not for the purpose of circumventing the
statute, (c) pursuant to the laws of intestate succession or
pursuant to gift or testamentary transfer, or (d) pursuant to a
statutory merger or share exchange to which the corporation is a party.
This provision also permits a corporation to adopt a provision
in its charter or bylaws providing for the redemption by the
corporation of such acquired shares in certain circumstances, and
provides that unless otherwise provided in the corporation's
articles of incorporation or bylaws prior to the pertinent
acquisition of shares, in the event that such shares are accorded
full voting rights by the stockholders of the corporation and the
acquiring stockholder acquires a majority of the voting power of the
corporation, all stockholders who did not vote in favor of according
voting rights to such acquired shares are entitled to dissenters'
rights.
Furthermore, this provision applies to any Florida corporation
unless the original articles of incorporation (or an amendment to
the articles of incorporation) or the bylaws contain a provision
expressly electing not to be governed by this provision prior to the
occurrence of the control share acquisition. Neither the Florida
Articles nor the Florida Bylaws contain a provision electing not to
be governed by the statute.
REMOVAL OF DIRECTORS.
The New Jersey Act and the Florida Act provide that, except
with respect to corporations with directors elected by a voting
group of stockholders or by cumulative voting, stockholders may
remove one or more directors with or without cause unless the
corporation's articles of incorporation provides that directors may
be removed only for cause.
None of our directors are elected by a voting group and there
is no cumulative voting. Neither the New Jersey Certificate nor the
Florida Articles do not provide that a director may be removed only
for cause.
COMMITTEES OF THE BOARD OF DIRECTORS.
Generally, both the New Jersey Act and the Florida Act provide
that the board of directors of a corporation may delegate certain of
its duties to one or more committees elected by a majority of the
board.
Under the New Jersey Act a committee of the board of directors
may not adopt, amend or repeal the bylaws, elect or appoint any
director or remove any officer or director, submit to stockholders
actions required to be approved by the stockholders or amend or
repeal any resolution previously adopted by the board which is
amendable or repealable only by the board.
Under the Florida Act a committee of the board of directors may
not approve or recommend to stockholders actions or proposals
required to be approved by the stockholders, fill a vacancy on the
board, adopt, amend or repeal the bylaws, authorize the issuance of
stock, or authorize the reacquisition of the corporation's own
stock.
DISSENTERS' RIGHTS.
Under the New Jersey Act, dissenting stockholders who follow
prescribed statutory procedures are, in certain circumstances,
entitled to appraisal rights in the case of (a) a merger or
consolidation; (b) a sale or exchange of all of substantially all
the assets of a corporation; and (c) receipt of shares in connection
with a plan of share exchange; provided that, generally, no
appraisal rights exist with respect to any class or series of shares
listed on a national securities exchange or held of record by 1,000
holders or more, or, in any transaction in connection with which the
shareholders of the corporation will receive only (a) cash, (b)
securities that, upon consummation of the transaction, will be
listed on a national securities exchange or be held of record by not
less than 1,000 holders, or (c) cash and such securities.
Under the Florida Act, dissenting stockholders who follow
prescribed statutory procedures are, in certain circumstances,
entitled to appraisal rights in the case of (a) a merger or
consolidation; (b) a sale or exchange of all of substantially all
the assets of a corporation; (c) amendments to the charter that
adversely affect the rights or preferences of stockholders; (d)
consummation of a plan of share exchange if the stockholder is
entitled to vote on the plan; and (e) the approval of a control
share acquisition pursuant to Florida law. Such rights are not
provided when: (a) such stockholders are stockholders of a
corporation surviving a merger or consolidation where no vote of the
stockholders is required for the merger or consolidation; or (b)
shares of the corporation are listed on a national securities
exchange, designated as a national market security by the NASDAQ
Stock Market or held of record by more than 2,000 stockholders.
DERIVATIVE ACTIONS.
The New Jersey Act provides:
- a person may not bring a derivative action unless the person
was a stockholder of the corporation at the time of the challenged
transaction or unless the stock thereafter devolved on such person
by operation of law;
- a derivative proceeding may be settled or discontinued only
with court approval.
- if an action was brought without reasonable cause, the court
may require the plaintiff to pay the corporation's reasonable
expenses.
The Florida Act provides:
- a person may not bring a derivative action unless the person
was a stockholder of the corporation at the time of the challenged
transaction or unless the stock thereafter devolved on such person
by operation of law;
- a complaint in a derivative proceeding must be verified and
must allege that a demand was made to obtain action by the board of
directors and that the demand was refused or ignored; and
- a derivative proceeding may be settled or discontinued only
with court approval.
- if an action was brought without reasonable cause, the court
may require the plaintiff to pay the corporation's reasonable
expenses.
In addition, under the Florida Act, a court may dismiss a
derivative proceeding if:
- if the court finds that independent directors (or a committee
of independent persons appointed by such directors) have determined
in good faith after conducting a reasonable investigation that the
maintenance of the action is not in the best interests of the
corporation;
- the court determines in its own business judgment that the
action should be dismissed.
AMENDMENT TO CHARTER.
The New Jersey Act establishes specific circumstances under
which a company's certificate of incorporation may be amended, and
generally requires approval by a majority of the outstanding stock
entitled to vote thereon.
The Florida Act generally provides that an amendment to the
articles of incorporation must be approved by the board of directors
and by the corporation's stockholders, and generally requires that
the votes cast in favor of the amendment exceed the votes cast
against the amendment unless the Florida Act, articles of
incorporation or the corporation's board of directors requires a
greater vote.
AMENDMENTS TO BYLAWS.
Both the New Jersey Act and the Florida Act, generally, provide
that the stockholders, as well as the directors, may amend the
bylaws, unless such power is reserved to the stockholders by the
articles of incorporation or by specific action of the stockholders.
The New Jersey Certificate and the Florida Articles permit the
board of directors to make or amend the bylaws, subject to the
stockholders' right to repeal such by-laws or amendments thereto,
LIABILITY OF DIRECTORS.
Under the New Jersey Act, a certificate of incorporation may
provide that a director shall not be personally liable to the
corporation or its shareholders for damages for breach of any duty
owed to them, except for a breach of duty based upon an act or
omission (a) in breach of such person's duty of loyalty to the
corporation or its shareholders, (b) not in good faith or involving
a knowing violation of law or (c) resulting in receipt by such
person of an improper personal benefit.
The New Jersey Certificate does not include such a provision.
Under the Florida Act, a director is not personally liable for
monetary damages to the corporation or any other person for any
statement, vote, decision or failure to act, regarding corporate
management or policy, unless the director breached or failed to
perform such parties duties as a director and such breach or failure
constitutes:
(a) a violation of criminal law unless the director had
reasonable cause to believe his conduct was lawful or had no
reasonable cause to believe his conduct was unlawful,
(b) a transaction from which the director derived an improper
personal benefit,
(c) a circumstance resulting in an unlawful distribution,
(d) in a proceeding by or in the right of the corporation to
procure a judgment in its favor or by or in the right of a
stockholder, conscious disregard for the best interests of the
corporation or willful misconduct, or
(e) in a proceeding by or in the right of one other than the
corporation or a stockholder, recklessness or an act or omission
committed in bad faith or with malicious purpose or in a manner
exhibiting wanton and willful disregard of human rights, safety, or
property.
INDEMNIFICATION.
Under both the New Jersey Act and the Florida Act, a
corporation may generally indemnify its officers, directors,
employees and agents against expenses (including attorneys' fees),
judgments, fines and amounts paid in settlement of any proceedings
(other than derivative actions), if they acted in good faith and in
a manner they reasonably believed to be in or not opposed to the
best interests of the corporation and, with respect to any criminal
action or proceeding, had no reasonable cause to believe their
conduct was unlawful. A similar standard is applicable in
derivative actions, except that indemnification may be made only for
(a) expenses (including attorneys' fees) and certain amounts paid in
settlement and (b) in the event the person seeking indemnification
has been adjudicated liable, amounts deemed proper, fair and
reasonable by the appropriate court upon application thereto. Both
the New Jersey Act and the Florida Act further provide that to the
extent that such persons have been successful in defense of any
proceeding, they must be indemnified by the corporation against
expenses actually and reasonably incurred in connection therewith.
The Florida Act further provides that, unless a corporation's
articles of incorporation provides otherwise, if a corporation does
not so indemnify such persons, they may seek, and a court may order,
indemnification under certain circumstances even if the board of
directors or stockholders of the corporation have determined that
the persons are not entitled to indemnification.
The New Jersey Certificate and the New Jersey Bylaws are do not
vary the provisions of the New Jersey Act.
The Florida Articles and the Florida Bylaws each provide that
directors and officers and former directors and officers will be
indemnified to the fullest extent permitted by the Florida Act.
STOCKHOLDER INSPECTION OF BOOKS AND RECORDS.
Under the New Jersey Act, a voting list setting forth the name,
address and number of shares held must be available for inspection
by any shareholder during any shareholders' meeting. In addition,
any person who has been a shareholder of record for at least six
months immediately preceding a demand by such person, or any person
holding, or so authorized by the holders of, at least 5% of the
outstanding shares of any class or series, upon at least five days
written demand, has the right, for any proper purpose, to examine,
in person or by agent or attorney, during usual business hours, the
minutes of the proceedings of the corporation's shareholders and
record of shareholders, and to make extracts therefrom at the places
where they are kept (within or outside of New Jersey), or, in the
case of shareholder records, within ten days after the demand, at
the corporation's registered office or at the office of its transfer
agent within New Jersey, or, in the case of shares listed on a
national securities exchange, at the office of the corporation's
transfer agent within or outside of New Jersey. Also, irrespective
of the length of time during which a shareholder shall have been a
record shareholder or of the number of shares held, a court is
empowered, upon proof of proper purpose, to compel production for
examination by the shareholder of the books and records of account,
minutes and record of shareholders.
Under the Florida Act a stockholder is entitled to inspect and
copy the articles of incorporation, bylaws, certain board and
stockholder resolutions, certain written communications to
stockholders, a list of the names and business addresses of the
corporation's directors and officers, and the corporation's most
recent annual report during regular business hours only if the
stockholder gives at least five business days' prior written notice
to the corporation. In addition, a stockholder of a Florida
corporation is entitled to inspect and copy other books and records
of the corporation during regular business hours only if the
stockholder gives at least five business days' prior written notice
to the corporation and (a) the stockholder's demand is made in good
faith and for a proper purpose, (b) the demand describes with
particularity its purpose and the records to be inspected or copied
and (c) the requested records are directly connected with such
purpose. The Florida Act also provides that a corporation may deny
any demand for inspection if the demand was made for an improper
purpose or if the demanding stockholder has, within two years
preceding such demand, sold or offered for sale any list of
stockholders of the corporation or any other corporation, has aided
or abetted any person in procuring a list of stockholders for such
purpose or has improperly used any information secured through any
prior examination of the records of the corporation or any other
corporation.
TREASURY STOCK.
Both the New Jersey Act and the Florida Act provide that a
corporation may, unless its certificate of incorporation or articles
of incorporation, as the case may be, generally reacquire its own
issued and outstanding capital stock, and all capital stock so
reacquired is automatically returned to the status of authorized but
not issued or outstanding, and is not deemed treasury stock.
TAX CONSEQUENCES OF THE MERGER
The merger and resulting reincorporation of the Company from
New Jersey to Florida will constitute a tax-free reorganization
within the meaning of Section 368(a)(1)(F) of the Internal Revenue
Code of 1986, as amended. Accordingly, for federal income tax
purposes, no gain or loss will be recognized by stockholders upon
the conversion of the Common Stock of the Company into the American
Uranium Florida Common Stock. Each stockholder whose shares of
Common Stock of the Company are converted into the American Uranium
Florida Common Stock will have the same basis in the American
Uranium Florida Common Stock as such stockholder had in the Common
Stock of the Company held immediately prior to the effective date of
the merger. The stockholder's holding period in the American
Uranium Florida Common Stock will include the period during which
the corresponding shares of the Common Stock of the Company were
held, provided such corresponding shares of the Common Stock of the
Company were held as a capital asset on the effective date of the
merger.
We will recognize no gain or loss as a result of the merger and
reincorporation, and American Uranium Florida will, generally,
succeed, without adjustment, to the tax attributes of the Company.
PLEASE NOTE: THE DISCUSSION SET FORTH ABOVE IS INCLUDED FOR
GENERAL INFORMATION ONLY, and no information is provided in this
Proxy Statement regarding the tax consequences, if any, under
applicable state, local or foreign laws. Such discussion is NOT
BINDING UPON THE INTERNAL REVENUE SERVICE, AND NO RULINGS OF THE
INTERNAL REVENUE SERVICE WILL BE SOUGHT OR OBTAINED. THERE IS NO
ASSURANCE THAT THE INTERNAL REVENUE SERVICE WILL AGREE WITH THE
FOREGOING DISCUSSION. Each stockholder is advised to consult his or
her personal attorney or tax advisor as to the federal, state, local
or foreign tax consequences of the proposed reincorporation in view
of the stockholder's individual circumstances.
STOCKHOLDER APPRAISAL RIGHTS
Each of the Company's shareholders has the right to dissent
from the Reincorporation and to demand payment of the fair value of
the shares held by such shareholder calculated as of the day before
the day the vote authorizing the Reincorporation was taken,
excluding any appreciation or depreciation in anticipation of the
Reincorporation.
As indicated in this Proxy Statement, the Company has reserved
its right to abandon the Reincorporation for any reason at any time
before the Effective Date and may do so, if among other things, the
holders of a substantial number of shares of the Company exercise
dissenter's rights.
In order to perfect such rights, a shareholder of the Company
MUST, prior to the meeting at which the requisite shareholder
approval of the Reincorporation is obtained, file with the Company a
written objection to the Reincorporation, notifying the Company that
such shareholder will demand payment for the shares held by such
shareholder if the Reincorporation is effected. Within 10 days after
the date on which the Reincorporation is effected, American Uranium
Florida MUST give written notice of the effective date of the
Reincorporation, by certified mail to each shareholder who filed a
written notice of dissent.
Within 20 days after the mailing of the notice by American
Uranium Florida, any shareholder to whom American Uranium Florida
was required to give notice and who has filed a written notice of
dissent may make written demand on American Uranium Florida for the
payment of the "fair value" of such shareholders shares. Not later
than 20 days after making a demand for payment, a shareholder must
submit the certificates representing the shares upon which a demand
has been made to American Uranium Florida for notation thereon that
such a demand was made, whereupon such certificates shall be
returned to such shareholder.
Any shareholder failing to make such demand within the ten day
period will be bound by the Reincorporation, and once a demand is
made it may not be withdrawn by the shareholder without the consent
of American Uranium Florida. Any shareholder making such a demand
shall cease to have any rights as a shareholder except the right to
be paid the "fair value" of such shareholders shares. The right of
a shareholder to be paid "fair value" for such shareholders shares
shall cease if, among other things, such shareholder fails to submit
such shares for notation, unless a court having jurisdiction, for
good and sufficient cause determines otherwise, the demand for
payment is withdrawn, or the "fair value" is not agreed upon and no
action for determination of the "fair value" is commenced as
required by the New Jersey Act.
Within 10 days after expiration of the period within which
shareholders may make a written demand to be paid "fair value" for
their shares, American Uranium Florida shall mail to each dissenting
shareholder certain financial statements of American Uranium
Florida, and may accompany such financial statements with a written
offer to pay a specified price deemed by American Uranium Florida as
the "fair value" thereof. If, within 30 days after the foregoing 10
day period, the "fair value" of the shares is agreed upon by a
dissenting shareholder and American Uranium Florida, payment shall
be made by American Uranium Florida upon surrender of the
certificates representing the shares, otherwise the dissenting
shareholder may, within 30 days after the foregoing 30 day period,
serve a written demand upon American Uranium Florida to commence an
action in the Superior Court to determine the "fair value" If such
a demand is made by the shareholder, American Uranium Florida shall
commence such action within 30 days after the receipt of the demand
therefor, and it American Uranium Florida fails to so commence such
action, a dissenting shareholder may, in the name of American
Uranium Florida, commence such action not later than 60 days after
the expiration of the foregoing 30 day period.
The costs and expenses of bringing such an action, including
appraiser's fees, shall be determined by the court and shall be
apportioned and assessed between the parties as the shall determine
to be equitable.
The foregoing summary does not purport to be a complete
statement of the rights of dissenting shareholders, and such summary
is qualified in its entirety by reference to Chapter 11 of the New
Jersey Act, which is reproduced in full as Exhibit F hereto.
The Board of Directors Unanimously Recommends That You
Vote FOR the Reincorporation. A vote for the
Reincorporation will constitute specific approval of the
Merger Agreement, the Florida Articles, the Florida Bylaws
and all of the transactions and proceedings related to the
Reincorporation described in this Proxy Statement.
APPOINTMENT OF INDEPENDENT AUDITORS
Although the submission of this matter for stockholder
ratification at the Annual Meeting is not required by law or our
bylaws, we are, nevertheless, asking you to ratify our selection of
Arthur Andersen LLP as our independent public accountants for the
fiscal year ending December 31, 2000, in order to determine the
stockholders' views. Arthur Andersen LLP does not currently act as
our independent auditor and, subject to the agreement of Arthur
Andersen LLC., which agreement has not yet been obtained, is
intended to replace Samuel Klein and Company who is currently acting
as our independent auditors, and has acted in that capacity since
1998. We would not be terminating our relationship with Samuel
Klein and Company as a result of any disagreement, and the report of
Samuel Klein and Company on our financial statements for each of the
two most recent years preceding the termination, if it were to
occur, did not contain an adverse opinion or disclaimer of opinion,
nor was its report modified as to uncertainty, audit scope, or
accounting principles, nor would the termination be based on any
resolved or unresolved disagreements on any matter of accounting
principles or practices, financial statement disclosures or auditing
scope or procedures. The decision to change our accountants to
Arthur Andersen LLP was recommended by our officers and approved by
our Board of Directors. If the selection of Arthur Andersen LLP is
not ratified, the Board may reconsider its selection of independent
accountants. A representative of Arthur Andersen LLP is not
expected to attend the Annual Meeting, and, therefore, will not be
available to answer questions and will not have an opportunity to
make a statement.
The Board of Directors Unanimously Recommends That You Vote FOR
the Selection of Arthur Andersen LLP to Serve As Our Auditors
for the Fiscal Year Ending December 31, 2000.
ELECTION OF DIRECTORS
The Merger Agreement provides that the Board of Directors
serving the Company immediately prior to the effective date of the
Merger shall be nominated for election to the Board of Directors of
American Uranium Florida. The Florida Bylaws provide for a Board of
Directors of at least one member and not more than seven members,
each such member elected to a one year term expiring at the next
ensuing annual meeting. Currently, the Board has three members,
Glen Akselrod, C.T. Yeh and Dr. Stewart A. Jackson. Dr. Stewart A.
Jackson has elected to withhold his name from being nominated for
re-election. As a result, Anthony Ng is being nominated to fill the
vacancy on the Board of Directors. If elected, Glen Akselrod, C.T.
Yeh and Anthony Ng will be elected for a one year term and serve
until their replacements are elected and qualified. All directors
serve until their successors are elected and qualified, subject,
however, to prior death, resignation, retirement, disqualification,
or removal from office.
You are being asked to elect Messrs. Glen Akselrod, C.T. Yeh
and Anthony Ng to our Board for a one year term. If all the nominee
directors are elected, we will have three directors.
The person named as proxy holder in the enclosed proxy cards
(Mr. Akselrod) has advised us that, unless a contrary direction is
indicated on a proxy card, he intends to vote FOR the election of
the three nominees. He has also advised us that, if any of the
three nominees are not available for election for any reason, he
will vote FOR the election of such substitute nominee or nominees,
if any, as the Board of Directors may propose. Each person
nominated for election has agreed to serve if elected, and the Board
of Directors has no reason to believe that any nominee will be
unavailable to serve if elected.
CURRENT BOARD MEMBERS
Glen Akselrod, C.T. Yeh and Dr. Stewart A. Jackson currently
serve as our directors. Glen Akselrod and C.T. Yeh have been
nominated for re-election to the Board, and Anthony Ng has been
nominated for election to the Board.
GLEN AKSELROD. Glen Akselrod has served as the President,
Director and Chief Executive Officer of the Company since August
1999. Since November 1998 he has been employed by thestockpage.com
as Vice President. Thestockpage.com. is an Ontario corporation in
the business of marketing and public relations. Prior to joining
thestockpage.com Mr. Akselrod was an analyst for two property and
casualty insurers. Mr. Akselrod has a Bachelor of Science -
Actuarial Science and Economics degree from the University of Toronto.
C.T. YEH. C.T. Yeh, has been the Secretary and a director of
the Company since 1997. Mr. Yeh has over 25 years of experience
with mining companies and financial services companies. From 1996 to
1997, Mr. Yeh was President of YCN Group, L.L.C., a joint venture
partner with Yang Cheng (Group) Co., Ltd., a Macau based company
wholly owned by the Municipality of Guangzhou, China. From 1992 to
1996, Mr. Yeh was Managing Director of Ridgewood Partners Ltd., an
investment banking company. From 1988 to 1992, Mr. Yeh was a
Director of Elders Resources Finance Inc., a merchant bank providing
capital to the junior mining companies. From 1979 to 1986, Mr. Yeh
was Director and Financial Planner of Inspiration Resources. From
1974 to 1979, Mr. Yeh was a Senior Process Economics Engineer at
Kennecott Copper. From 1969 to 1974, Mr Yeh was a Metallurgist at
Foote Minerals Company, and from 1966 to 1969, Mr. Yeh was a
Research Metallurgist at Calumet & Hecla Company. Mr. Yeh holds a
Bachelor of Science degree in Metallurgical Engineering from Cheung
Kung University, a Master of Science degree in Metallurgical
Engineering from Michigan Technological University and an M.B.A.
with Honors from the University of Delaware. Mr. Yeh holds several
U.S. Patents in Metallurgy and has written several research papers
for the American Institute of Metallurgical Engineers and the
American Ceramic Society.
DR. STEWART A. JACKSON. Dr. Stewart A. Jackson has been the
director of the Company since 1997. Dr. Jackson is an experienced
geologist with 37 years of experience in exploration and development
of both base and precious metal deposits. Dr. Jackson was
responsible for the discovery and development of several major
mineral discoveries, including the Red Dog multi-billion dollar zinc
deposit in northwestern Alaska for Cominco Resources, Inc. Dr.
Jackson was responsible for the raising of over $50 million for
several publicly traded companies, including Crown Resource Corp.,
founded by Dr. Jackson in 1981. Since 1987 Dr. Jackson has been an
independent consulting geologist for several private and public
companies. Dr. Jackson earned a Bachelors of Science Degree
majoring in Geology from the University of Western Ontario, a
Masters of Science majoring in Stratigraphy and Mineral Deposit and
a Doctorate from the University of Toronto.
BOARD NOMINEE
ANTHONY NG. From 1987 through 1995 Mr. Ng served as President
of Moorgate Financial Corp; from 1995 through 1998 Mr. Ng served as
President of Pan Pacific Strategies Corp.; and from 1998 to the
present Mr. Ng serves as President of Zeuspac Capital Bancorporation
Ltd. Mr. Ng received a Bachelor of Arts from the University of Hong
Kong and a Masters in Philosophy from London University.
The Board of Directors recommends that you vote FOR all of
the director nominees.
BOARD AND COMMITTEE MEETINGS
The Board of Directors has not established any committees.
Accordingly, the Board of Directors does not have a nominating
committee. The entire Board of Directors performs those duties.
The Board of Directors held six meetings, and took actions by
written consent on no occasion, during our 1999 fiscal year. Each
current director attended 75% or more of the 1999 fiscal year
meetings of the Board of Directors.
DIRECTOR COMPENSATION
None of our directors have employment agreements or stock
option arrangements with the Company. We intend for the directors
to be compensated at the rate of $2,500 per year, plus $500.00 per
meeting attended, plus reimbursement of reasonable travel expenses,
when, and if, our cash flow permits. To date, none of the directors
have received any salaries or other cash compensation.
BENEFICIAL OWNERSHIP
The following table sets forth certain information furnished by
current management concerning the beneficial ownership, as of May
19, 2000, of our outstanding capital stock by (i) each of our
stockholders who beneficially own 5% or more of any class of our
stock, (ii) each of our directors and our director nominees, (iii)
each of our executive officers, and (iv) all of our directors,
director nominees and executive officers as a group. Unless
otherwise noted, each person (either alone or with family members)
has voting and dispositive power of the shares listed opposite his
or her name.
<TABLE>
<S> <C> <C> <C>
NAME OF CLASS NUMBER OF PERCENTAGE OF
BENEFICIAL SHARES CLASS (1)
OWNER
Glen Akselrod Common 1,000,000 11.1%
(2)(3)
(President,
CEO, Director
and 5%
Shareholder)
C. T. Yeh Common 0 0.00%
(Director and
Secretary)
Anthony Ng Common 1,000,000 11.1%
(4)(5)
(Director
nominee)
Uranium Common 1,000,000 11.1%
Strategies,
Inc. (6)
(5%
Shareholder)
Pan Zone Co. Common 1,000,000 11.1%
Ltd (7)
(5%
Shareholder)
Thesis Group, Common 800,000 8.8%
Inc. (8)
(5%
Shareholder)
New Century Common 880,000 9.7%
Investment
Holdings Inc.
(9)
(5%
Shareholder)
Stewart A. Common 1,000,000 11.1%
Jackson
(10)(11)
(Director, 5%
Shareholder)
All directors Common 2,000,000 22.2%
(and nominee
directors) and
officers as a
group (12)
(4 persons)
</TABLE>
(1) Based on 9,058,261 outstanding shares of common stock. The
inclusion of any shares as "beneficially owned" does not constitute
an admission of beneficial ownership (which has a broad definition
under the securities laws) of those shares. Unless otherwise
indicated, each person listed has sole investment and voting power
with respect to the shares listed. Also, each person is deemed to
beneficially own any shares issuable on exercise of stock options or
warrants held by that person that are currently exercisable or that
become exercisable within 60 days after May 19, 2000.
(2) The address for Mr. Akselrod is care of the Company at 121
Richmond Street West, 7th Floor, Toronto, Ontario, Canada M5H 2K1.
(3) Mr. Akselrod is the chief executive officer and a director of
Uranium Strategies, Inc., and consequently has beneficial ownership
of the shares of common stock of the Company owned by Uranium
Strategies. Mr. Akselrod disclaims beneficial ownership as to all
shares of common stock of the Company held by Uranium Strategies.
(4) The address for Mr. Ng is 31 Grass Meadoway, Toronto Ontario,
Canada M2H 2V4.
(5) Mr. Ng is the president and a director of Pan Zone Co. Ltd and
consequently has beneficial ownership of the shares of common stock
of the Company owned by Pan Zone Co. Ltd. Mr. Ng disclaims
beneficial ownership as to all the shares of common stock of the
Company held by Pan Zone Co. Ltd.
(6) The address for Uranium Strategies, Inc. is 3550 Skyline View
Drive, Reno, Nevada 89509.
(7) The address for Pan Zone Co. Ltd is Nippo Sun Centre, Suite
1408, 28 Canton Road, Kowloon, Hong Kong.
(8) The address for Thesis Group Inc. is Hanover Terrace, London
SVW1 4RJ England.
(9) The address for New Century Investment Holdings Inc. is Bison
Court, Road Town, Tortola, British Virgin Islands.
(10) The address for Dr. Jackson is care of the Company at 121
Richmond Street West, 7th Floor, Toronto, Ontario, Canada M5H 2K1.
(11) Dr. Jackson is the secretary and a director of Uranium
Strategies, Inc., and consequently has beneficial ownership of the
shares of common stock of the Company owned by Uranium Strategies.
Dr. Jackson disclaims beneficial ownership as to all shares of
common stock of the Company held by Uranium Strategies.
(12) See Notes 2, 3, 4, 5, 10 and 11 above.
COMPENSATION OF EXECUTIVE OFFICERS
EXECUTIVE COMPENSATION
We have not paid our Chief Executive Officer or any other of
our executive officers any compensation during the fiscal year ended
December 31, 1999, nor was any such compensation earned except that
we paid our prior President, G. Ken Webb $2,500.00 per month until
March, 1999. We did not award any executive officers any options or
stock awards subsequent to December 31, 1999 through the date of
this proxy statement.
FISCAL YEAR-END OPTION VALUE
As of the date of this proxy statement, none of our executive
officers have any options to acquire common shares.
EMPLOYMENT AGREEMENTS
We have not entered into any employment agreements with either
our Chief Executive Officer or any other of our executive officers.
As circumstances warrant, we may enter into employment agreements
with our officers and key employees.
CERTAIN TRANSACTIONS
During the past two years we have not engaged in nor do we
propose to engage in, any transaction which involves our executive
officers, directors, director nominees, 5% stockholders or immediate
family members of those persons.
COMPLIANCE WITH SECTION 16 OF THE SECURITIES EXCHANGE ACT
Under Section 16 of the Securities Exchange Act of 1934 (the
"Securities Exchange Act") and the rules thereunder, our directors,
certain officers and persons who beneficially own more than 10% of
our outstanding common stock are required to file reports with the
Securities and Exchange Commission and any exchange on which our
securities are listed concerning their ownership of and transactions
in our common stock, and to furnish us with copies of those reports.
Based solely upon the reports and related information furnished to
us, we believe that all such filing requirements were complied with
in a timely manner during and with respect to our 1999 fiscal year.
STOCKHOLDER PROPOSALS
The rules of the Securities and Exchange Commission provide
that stockholder proposals may be considered for inclusion in the
proxy material for our annual meetings under certain circumstances.
Our bylaws provide that any stockholder proposals for our annual
meeting must be made in writing and delivered to us not less than 90
days nor more than 120 days prior to that meeting, but if we provide
you with less than 30 days notice (actual or by public disclosure)
of the meeting, proposals will be deemed timely if they are received
not more than 10 days following the date of the notice or the public
disclosure of the meeting. Any such proposals must comply with the
requirements of the Securities Exchange Act and the rules
thereunder. Stockholder proposals should be addressed to the
Company to the attention of Glen Akselrod, President, 121 Richmond
Street, 7th Floor, Toronto, Ontario, M5H 2K1, Canada.
OTHER MATTERS
The Board of Directors does not presently intend to bring any
other business before the meeting, and we know of no other matters
that are to be brought before the meeting except as specified in the
notice of the meeting. If any additional business properly comes
before the meeting, however, your shares will be voted in accordance
with the judgment of the persons voting your proxy.
By Order of the Board of Directors
By:
Glen Akselrod, President
All stockholders are urged to complete, sign, date and return
the accompanying proxy card in the enclosed postage-paid envelope.
Thank you for your prompt attention to this matter.
PROXY FOR
AMERICAN URANIUM, INC.
ANNUAL MEETING OF STOCKHOLDERS
June 19, 2000
The undersigned hereby appoints Glen Akselrod, as proxy, with
the power to appoint his substitute, and hereby authorizes him to
represent and to vote, as designated below, all the shares of common
stock of American Uranium, Inc. held of record by the undersigned on
May 19, 2000, at the annual meeting of the stockholders to be held
on June 19, 2000, or any adjournment thereof.
1. REINCORPORATION. To approve of a proposal to change
the Company's state of incorporation from New Jersey to Florida by
means of a merger of the Company into a wholly-owned Florida
subsidiary of the Company, American Uranium Reincorporation, Inc.
_____ FOR _____ AGAINST _____ ABSTAIN
2. INDEPENDENT ACCOUNTANT. To ratify the selection of
Arthur Andersen LLP as our independent accountant.
_____ FOR _____ AGAINST _____ ABSTAIN
3. ELECTION OF DIRECTORS. To elect the following
nominees as directors, until such time as each such member's
successor shall have been elected and duly qualified: Glen Akselrod,
C.T. Yeh and Anthony Ng.
_____ FOR all nominees listed above, except as marked to
the contrary with respect to any one or more of
the nominees by your clearly striking a line
through that nominee's name in the list of
nominees above.
_____ WITHHOLD AUTHORITY to vote for ALL nominees listed above.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
and, when properly executed, will be voted in the manner directed
herein by the undersigned stockholder and, in the discretion of the
named proxies, in such manner as the named proxies may determine
with respect to any other matter that may properly come before the
annual meeting. If no direction is made, this proxy will be voted
for all proposals and the election of all the director nominees set
forth in this proxy.
By signing this proxy, you represent and warrant that you are
entitled to vote the number of shares in the manner prescribed. We
may rely upon this representation and you agree to provide us, upon
request, with evidence that you are authorized to vote the shares as
represented.
Please sign your name exactly as it appears on our records, and
indicate the number and class of shares of capital stock you held as
of May 19, 2000. When shares are held by joint tenants, both should
sign. When signing as attorney, as executor, administrator, trustee
or guardian, please give full title as such. If a corporation or
other entity, please sign in full corporate name by president or
other authorized officer. If a partnership, please sign in
partnership name by authorized person.
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY PROMPTLY USING
THE ENCLOSED ENVELOPE. THIS PROXY MUST BE RETURNED TO US BEFORE THE
CLOSE OF BUSINESS ON JUNE 13, 2000 TO BE EFFECTIVE.
Dated:___________ Number of Shares:_____________
______________________________
_____________________________________
(Signature of Shareholder) (Signature of Shareholder if
held jointly)
______________________________
Exact Name(s) of Shareholder(s),
as set forth in the corporation's records
Exhibit A
Annual Report on Form 10-KSB for the Year Ended December 31, 1999
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-KSB
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 1999
-------------------------------
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from ___________________ to
_______________________
Commission file number 0-26037
AMERICAN URANIUM, INC.
--------------------------------------------
(Name of small business issuer in its charter)
New Jersey N/A
- --------------------------------
----------------------------------- (State or other jurisdiction of
(I.R.S. Employer Identification No.) incorporation or
organization)
121 Richmond Street West, 7th Floor Toronto, Ontari, Canada
M5H 2K1 -
-----------------------------------------------------------
---------- (Address of principal executive offices)
(Zip Code)
Issuer's telephone number: (416) 203-0010
Securities registered pursuant to Section 12(b) of the Act:
Title of each class Name of each exchange on which
registered None N/A
Check whether the Issuer (1) has filed all reports required to be
filed by section 13 or 15(d) of the Exchange Act during the past 12
months (or for such shorter period that the registrant was required
to file such reports), and (2) has been subject to such fling
requirements for the past 90 days. (1) Yes [X] No [ ]
Check if disclosure of delinquent filers in response to Item 405 of
Regulation S-B is not contained in this form, and no disclosure will
be contained, to the best of registrant's knowledge, in definitive
proxy or information statements incorporated by reference in Part
III of this Form 10-KSB or any amendment to this Form 10-KSB. [X]
State issuer's revenues for its most recent fiscal year: $-0-
State the aggregate market value of the voting stock held by
non-affiliates of the Registrant computed by reference to the price
at which the stock was sold, or the average bid and asked prices of
such stock, as of a specified date within the past 60 days: The
aggregate market value of the voting stock held by non-affiliates of
the Registrant (558,000 shares) cannot be computed because there is
no trading market.
State the number of shares outstanding of each of the Issuer's
classes of common equity as of the latest practicable date: At March
26, 2000, there were 9,058,261 shares of the Registrant's Common
Stock outstanding.
Documents Incorporated by Reference: None
<PAGE>
PART I
ITEM 1. DESCRIPTION OF BUSINESS
General
American Uranium was organized under the laws of the State of
New Jersey on October 22, 1991 under the name PRS Sub III, Inc. and
changed its name to American Uranium Inc. in 1998. American Uranium
was originally formed as a subsidiary of People Ridesharing Systems,
Inc., a company which filed for reorganization under Chapter 11 of
the Bankruptcy Act. As a result of an order of the United States
Bankruptcy Court in May 1996 relating to the bankruptcy of People
Ridesharing, the common stock ownership in American Uranium was
issued 10% to the creditors and 5% to the stockholders of People
Ridesharing and 85% to an investor.
Prior Operations
From the time of the reorganization on October 22, 1991 until
the company changed its name to American Uranium, American Uranium
had no business operations.
Activities During 1999
During the year ended December 31, 1999, American Uranium
conducted no material business operations.
Proposed Activities
Identify and Acquire Uranium and Vanadium Properties
American Uranium entered into an agreement with a mineral
exploration company, Platoro West LLC that owns a database of
geological exploration information on approximately 1,500
properties, the majority of which are located in the United States.
The database was acquired by Platoro as part of the liquidation of
certain mining subsidiaries of a major multinational chemical
company that was previously engaged in mineral exploration. The
database was compiled during the 1960's and 1970's, and it is
believed to contain exploration results and feasibility studies that
still have valuable, useful information. The agreement provides for
Platoro to identify eight to ten advanced stage properties with
proven reserves in the United States for American Uranium to stake
or otherwise acquire if interested. American Uranium views this
database as a substantial competitive advantage in the
identification of high quality mineral properties with significant
potential for full development.
American Uranium's initial plans are to acquire claims for five
to ten uranium and vanadium properties. The claims may include those
identified by Platoro West, LLC.
Update of Past Exploration Results and Feasibility Studies on Staked
Claims
Once American Uranium identifies properties and acquires
ownership of the claims, it will contract with external geological
and environmental consultants to update the exploration results,
feasibility studies and environmental reports to determine if the
properties can be permitted for full-scale mining. Each property
will be studied to determine the production price that will support
positive cash flow and that would be attractive to develop using
modern mining methods or to joint venture develop with a major
mineral producer. Claims that are not feasible to permit will not be
renewed with the applicable federal and state authorities.
<PAGE>
Obtain Permits for Properties Identified as Feasible to Mine
American Uranium will have to undergo an extensive permitting
process prior to extracting minerals from feasible properties.
Operating and environmental permits will be obtained from the
applicable regulatory bodies utilizing technical applications filed
by American Uranium. American Uranium has identified external mining
consultants to assist with preparing and filing permits to all
applicable regulatory authorities in the United States. American
Uranium is able to draw upon the significant mining experience of
its principal shareholders, officers and directors to ensure the
best resources are allocated to permitting and proper procedures are
followed.
Develop Mining Facilities and Extract Ore from Permitted Properties
American Uranium intents to use three approaches to mine
permitted properties: (i) develop the facilities to extract and
partially refine the ore and contract for later-stage refining with
third-party refiners, (ii) enter a joint venture agreement with a
major mineral producer to extract and refine the ore - American
Uranium will receive a percentage of the revenues from the sale of
refined ore, or (iii) sell the permitted property to a major mineral
producer. American Uranium will require significant capital to
manage and operate fully functional mines without the assistance of
a major mineral producer and does not view this as the preferred
option.
Mineral Ore Orientation
Recent acquisitions of uranium properties or junior uranium
mining and exploration companies by some major mineral producers has
resulted in American Uranium focusing on these particular minerals.
The selection of a business opportunity in which to participate
is complex and risky. Additionally, as American Uranium has only
extremely limited resources, it may be difficult to find good
opportunities. There can be no assurance that American Uranium will
be able to identify and acquire any business opportunity based on
management's business judgement.
Business Risks
The activities of American Uranium are subject to several
significant risks which arise primarily as a result of the fact that
American Uranium has no specific business and may acquire or
participate in a business opportunity based on the decision of
management which potentially could act without the consent, vote, or
approval of American Uranium's shareholders. The risks faced by
American Uranium are further increased as a result of its lack of
resources and its inability to provide a prospective business
opportunity with significant capital.
Employees
American Uranium has no employees.
ITEM 2. DESCRIPTION OF PROPERTY
American Uranium rents offices at 121 Richmond St. W., Seventh
Floor, Toronto, Ontario, M5H 2K1
ITEM 3. LEGAL PROCEEDINGS
American Uranium is not a party to any material pending legal
proceedings or government actions, including any material
bankruptcy, receivership, or similar proceedings. Management of
American Uranium does not believe that there are any material
proceedings to which any director, officer or affiliate of American
Uranium, any owner of record of beneficially of more than five
percent of the common stock of American Uranium, or any associate of
any such director, officer, affiliate of American Uranium, or
security holder is a party adverse to American Uranium or has a
material interest adverse to American Uranium.
<PAGE>
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITIES HOLDERS
No matters were submitted to a vote of shareholders of American
Uranium during the fourth quarter of the fiscal year ended December
31, 1999.
PART II
ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
The Common Stock of American Uranium is not quoted on any
quotation medium. There is currently no established public trading
market for the Common Stock.
At December 31, 1999, American Uranium had approximately 696
shareholders of record as reported by American Uranium's transfer
agent. The transfer agent for American Uranium is Olde Monmouth
Stock Transfer, 77 Memorial Parkway, Atlantic Highlands, NJ 07716.
Since its inception American Uranium has not paid any dividends
on its common stock, and American Uranium does not anticipate that
it will pay dividends in the foreseeable future.
ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
American Uranium is a development stage company. It has had no
revenues from operations during the fiscal years ended December 31,
1998 and 1999, or from October 21, 1991 (the commencement of the
development stage) to December 31, 1999. Expenses of American
Uranium decreased from $91,321 in 1998 to $40,073 in 1999. The costs
were reduced due to no new staking of claims in 1999 and reduced
consulting fees.
Liquidity and Capital Resources
American Uranium has no working capital. It has funded losses
from the proceeds of sale of securities in 1998 and 1999.
American Uranium does not have any capital resources. Before
American Uranium will be able to enter into any business operations,
it will have to raise capital. The capital requirements may be
substantial; American Uranium is unable to estimate its capital
requirements at this time because it does not have any business
operations. There can be no assurance that American Uranium will be
able to raise any capital in the future.
ITEM 7. FINANCIAL STATEMENTS
The financial statements of American Uranium are set forth
immediately following the signature page of this annual report.
ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
ON ACCOUNTING AND FINANCIAL DISCLOSURE
None
<PAGE>
PART III
ITEM 9. DIRECTORS AND EXECUTIVE OFFICERS, PROMOTERS AND
CONTROL PERSONS; COMPLIANCE WITH SECTION 16(a) OF THE
EXCHANGE ACT
General
The following table sets forth certain information regarding
the current directors and executive officers of American Uranium:
POSITION(S) WITH
NAME AGE THE COMPANY DIRECTOR SINCE
Glen Akselrod 30 President & CEO 1999
CT Yeh 61 Secretary 1997
Stewart Jackson 60 Director 1997
There are no family relationships among any of the directors or
executive officers of American Uranium.
The following information is furnished for each of the
executive officers and directors of American Uranium:
Glen Akselrod has served as the President and Chief Executive
Officer of American Uranium since August 1999. Since November 1998
he has been employed by thestockpage.com as Vice President.
Thestockpage.com. is an Ontario corporation in the business of
marketing and public relations. Prior to joining thestockpage.com
Glen was an analyst for two property and casualty insurers. Mr.
Akselrod has a Bachelor of Science - Actuarial Science and Economics
degree from the University of Toronto.
Mr. C.T. Yeh, has been the Secretary and a director of American
Uranium since 1997. Mr. Yeh has over 25 years of experience with
mining companies and financial services companies. From 1996 to
1997, Mr. Yeh was President of YCN Group, L.L.C., a joint venture
partner with Yang Cheng (Group) Co., Ltd., a Macau based company
wholly owned by the Municipality of Guangzhou, China. From1992 to
1996, Mr. Yeh was Managing Director of Ridgewood Partners Ltd., an
investment banking company. From 1988 to 1992, Mr. Yeh was a
Director of Elders Resources Finance Inc., a merchant bank providing
capital to the junior mining companies. From 1979 to 1986, Mr. Yeh
was Director and Financial Planner of Inspiration Resources; from
1974 to 1979, was a Senior Process Economics Engineer at Kennecott
Copper; from 1969 to 1974, was a Metallurgist at Foote Minerals
Company; and from 1966 to 1969, Mr. Yeh was a Research Metallurgist
at Calumet & Hecla Company. Mr. Yeh holds a Bachelor of Science
degree in Metallurgical Engineering from Cheung Kung University, and
Master of Science degree in Metallurgical Engineering from Michigan
Technological University, and an M.B.A. with Honors from the
University of Delaware. Mr. Yeh holds several U.S. Patents in
Metallurgy and has written several research papers for the American
Institute of Metallurgical Engineers and the American Ceramic
Society.
Dr. Stewart A. Jackson, has been the director of American
Uranium since 1997. Dr. Jackson is an experienced geologist with 37
years of experience in exploration and development of both base and
precious metal deposits. Dr. Jackson was responsible for the
discovery and development of several major mineral discoveries,
including the Red Dog multi-billion dollar zinc deposit in
northwestern Alaska for Cominco Resources, Inc. Dr. Jackson was
responsible for the raising of over $50 million for several publicly
traded companies, including for Crown Resource Corp. founded by him
in 1981. Since 1987 Dr. Jackson has been an independent consulting
geologist for several private and public companies. Dr. Jackson
earned a Bachelors of Science Degree majoring in Geology from the
University of Western Ontario and a Masters of Science majoring in
Stratigraphy and Mineral Deposit and a Doctorate from the University
of Toronto.
Each director of American Uranium is elected to hold office
until the next annual meeting of the shareholders and until his or
her successor is elected and duly qualified. The bylaws state that
the annual meeting of shareholders shall be held on the first
Tuesday of November each year.
<PAGE>
ITEM 10. EXECUTIVE COMPENSATION
American Uranium paid Mr. G. Ken Webb, the then president of
American Uranium a salary of $2,500 per month until March 1999.
There has been no compensation awarded to or paid to any executive
officers since March 1999.
American Uranium has no written employment contracts with any
of its executive officers. No executive officer has entered into any
compensatory plan or arrangement with American Uranium with respect
to any resignation, retirement, or any other termination of such
executive officer's employment with American Uranium or from a
change in control of American Uranium, or a change in any executive
officer's responsibilities following any change of control.
ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT
The following table sets forth certain information furnished by
current management concerning the ownership of common stock of
American Uranium as of December 31, 1999, of (i) each person who is
known to American Uranium to be the beneficial owner of more than 5
percent of the Common Stock; (ii) all directors and executive
officers; and (iii) directors and executive officers of American
Uranium as a group:
Percent of Number of Shares of
Ownership of Common
Stock Common Stock Name of Beneficial Owner
Beneficially* Owned Outstanding -
---------------------------- ---------------------
------------
Glen Akselrod . . . . . . . . . 2,000,000(1)(2)
22.1% C.T. Yeh . . . . . . . . . . . - 0 -
- 0 - Stewart A. Jackson . . . . . . 2,000,000(1)(3)
22.1% Uranium Strategies, Inc. . . . 2,000,000(4)
22.1% Robert Landau . . . . . . . . .
1,800,000(5) 19.9% David Roff . . . . . . . . . .
1,800,000(5) 19.9% Thomas Skimming . . . . . .
. . 2,880,000(6) 31.8% Directors and officers
as a
group (3 persons) . . . . . . 2,000,000(7)
22.1% - ---------------------------------------------------
Beneficial ownership is determined in accordance with the rules
of the Securities and Exchange Commission and generally includes
voting or investment power with respect to securities. Shares of
common stock issuable upon the exercise of options or warrants
currently exercisable, or exercisable or convertible within 60 days,
are deemed outstanding for computing the percentage ownership of the
person holding such options or warrants but are not deemed
outstanding for computing the percentage ownership of any other
person.
(1) The address for each of Messrs. Akselrod and Jackson is care-of
American Uranium at 121 Richmond Street, West, Seventh Floor,
Toronto, Ontario, Canada M5H 2K1.
(2) Mr. Akselrod is the chief executive officer and a director of
Uranium Strategies, Inc., and consequently has beneficial
ownership of the shares of common stock of American Uranium
owned by Uranium Strategies. Mr. Akselrod disclaims beneficial
ownership as to all shares of common stock of American Uranium
held by Uranium Strategies.
(3) Mr. Jackson is the Secretary and a director of Uranium
Strategies and consequently has beneficial ownership of the
shares of common stock of American Uranium owned by Uranium
Strategies. Mr. Jackson disclaims beneficial ownership as to
all the shares of common stock of American Uranium held by
Uranium Strategies.
<PAGE>
(4) The address for Uranium Strategies, Inc. is 3550 Skyline View
Drive, Reno, Nevada 89509.
(5) The address for each of Messrs. Landau and Roff is 133 Richmond
Street, West, Suite # 401, Toronto, Ontario, Canada M5H 2L3.
(6) The address for Thomas Skimming is 11 Camelot Court, Toronto,
Ontario, Canada M3B 2N4.
(7) See Notes 2 and 3 above.
ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
There were no related party transactions during 1999.
ITEM 13. EXHIBITS, LIST AND REPORTS ON FORM 8-K
(a)(1) Financial Statements. The following financial statements are
included in this report:
Report of Samuel Klien and Partners, Certified Public
Accountants
Balance Sheet at December 31, 1999 and 1998
Statements of Operations for the years ended December 31, 1999
and 1998.
Statement of Changes in Stockholders' Equity from January 1,
1994, through December 31, 1999
Statements of Cash Flows for the fiscal years ended December
31, 1999 and 1998.
Notes to Financial Statements
(a)(2) Exhibits. The following exhibits are included as part of this
report:
Exhibit No. Description of Exhibit
3.1. Certificate of Incorporation of the Registrant**
3.2 Bylaws of the Resitrant**
4.1 Form of Common Stock Certificate of Registrant**
10.1 Consulting Agreement between Registrant and
Platoro West, LLC.**
27.1 Financial Data Sheet
** Previously filed - Incorporated by reference from Form 10-SB
dated May 4, 1999.
<PAGE>
SIGNATURES
In accordance with Section 13 of the Exchange Act, the
registrant caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
AMERICAN URANIUM, INC.
Date: March 30, 2000 By: /s/ Glen Akselrod
-----------------------------
Glen Akselrod, President
Principal Accounting Officer
and Chief Financial Officer
In accordance with the Exchange Act, this report has been signed
below by the following persons on behalf of the registrant and in
the capacitates and on the dates indicated.
By: /s/ Glen Akselrod, Director March 30, 2000
By: /s/ CT Yeh, Director March 30, 2000
By: /s/ Stewart Jackson, Director March 30, 2000
<PAGE>
AMERICAN URANIUM, INC.
FINANCIAL STATEMENTS
DECEMBER 31, 1999 AND 1998
F-1
<PAGE>
INDEPENDENT AUDITOR'S REPORT
To the Board of Directors and Stockholders
of American Uranium, Inc.
We have audited the accompanying balance sheets of American Uranium,
Inc. (formerly Zencrest Holdings Corp., Inc.) as of December 31,
1999 and 1998, and the related statements of operations,
stockholders' equity and cash flows for the years then ended. These
financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and perform
the audits to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of American
Uranium, Inc. as of December 31, 1999 and 1998, and the results of
its operations and its cash flows for the years then ended in
conformity with generally accepted accounting principles.
/s/ Samuel Klein and
Company
-----------------------------
SAMUEL KLEIN AND COMPANY
Newark, New Jersey
March 10, 2000
F-2
<PAGE>
AMERICAN URANIUM, INC.
BALANCE SHEETS
<TABLE>
December 31, ASSETS
1999
1998
---- ---- <S>
<C> <C> Current Assets:
Cash and cash equivalents
$ 29 $ 24,446 Prepaid expenses
1,856 5,208
------------
---------- Total Current Assets
1,885 29,654
------------ ----------
Mineral Resource Assets
64,393 61,819
----------- ----------
Fixed Assets:
Furniture and fixtures
661 - Less:
Accumulated depreciation
121 -
-------------
----------
540 -
------------- ----------
Total Assets
$ 66,818 $ 91,473
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable and accrued expenses
$ 5,485 $ 12,794 Stockholder
loans
5,428
------------ Total Current
Liabilities
10,913 12,794
-----------
------------
Total Liabilities
10,913 12,794
----------- ------------
Stockholders' Equity:
Common stock, $.001 par value, 100,000,000
shares authorized, 9,058,261 and 9,040,261
shares issued and outstanding at December
31, 1999 and 1998
9,058 9,040 Additional
paid-in-capital
188,942 170,960 Accumulated deficit
(142,095)
(101,321)
---------- ----------
Total Stockholders' Equity
55,905 78,679
----------- -----------
Total Liabilities and Stockholders' Equity
$ 66,818 $ 91,473
========== ========== </TABLE>
- --------------------
The accompanying notes are an integral part of these financial
statements.
F-3
<PAGE>
AMERICAN URANIUM, INC.
STATEMENTS OF OPERATIONS
<TABLE>
For the Years Ended
December 31,
1999 1998
---- ----
<S>
<C> <C> Revenues
$ -
$ -
Cost of Revenues
- -
------------
---------- Gross Profit
- -
------------ ----------
Other Costs:
General and administrative expenses
40,774 91,937
------------
---------- Total Other Costs
40,774 91,937
Other Income and Expense:
Interest income
- 616
------------
----------
Net Loss before Benefit from Income Taxes
(40,774) (91,321)
Benefit from Income Taxes
- -
------------
----------
Net Loss
$ (40,774) $ (91,321)
=============
========= </TABLE>
- --------------------
The accompanying notes are an integral part of these financial
statements.
F-4
<PAGE>
AMERICAN URANIUM, INC.
STATEMENTS OF STOCKHOLDERS' EQUITY
FOR THE YEARS ENDED DECEMBER 31, 1999 AND 1998
<TABLE>
Common Stock
$.001 Par Value
---------------
Common
Additional Total
Number Stock Paid-In-
Accumulated Stockholders'
of Shares Amount Capital Deficit
Equity ----------
------- ----------- ----------- ------------ <S>
<C> <C> <C>
<C> <C> Balances, January 1, 1998
2,500,261 $2,500 $ 7,500 $(10,000) $
-
Issuance of Common Shares 6,540,000 6,540
163,460 - 170,000
Net Loss for the Year Ended
December 31, 1998 - -
- (91,321) (91,321)
---------- ------- -----------
--------- --------
Balances, December 31, 1998 9,040,261 9,040
170,960 (101,321) 78,679
Issuance of Common Shares 18,000 18
17,982 - 18,000
Net Loss for the Year Ended
December 31, 1999 - -
- (40,774) (40,774)
---------- ------- -----------
--------- --------
Balances December 31, 1999 9,058,261 $9,058
$188,942 $(142,095) $ 55,905
========== ======== ===========
========= ========= </TABLE>
- --------------------
The accompanying notes are an integral part of these financial
statements.
F-5
<PAGE>
AMERICAN URANIUM, INC.
STATEMENTS OF CASH FLOWS
<TABLE>
For the Years Ended
December 31,
1999 1998
----
---- <S>
<C> <C> Cash Flows from Operating
Activities:
Net loss
$(40,774) $(91,321)
Adjustments to reconcile net loss to net cash
used in operating activities:
Depreciation
121 - (Increase) decrease
in prepaid expenses 3,352
(5,208) Increase (decrease) in accounts payable and
accrued expenses
(7,309) 12,794
----------
---------
Net Cash Used in Operating Activities
(44,610) (83,735)
---------
---------- Cash Flows from Investing Activities:
Purchase of fixed assets
(661) - Increase in Mineral
Resource Assets (2,574)
(61,819)
----------- -----------
Net cash used in investing activities
(3,235) (61,819)
-----------
----------- Cash Flows from Financing Activities:
Proceeds from the issuance of common stock
18,000 170,000 Proceeds of stockholder
loans 5,428
-
------------ ----------
Net cash provided by financing activities
23,428 170,000
------------ ----------
Net Increase (Decrease) in Cash and Cash Equivalents
(24,417) 24,446
Cash and Cash Equivalents, beginning of year
24,446 -
-----------
----------
Cash and Cash Equivalents, end of year
$ 29 $ 24,446
=============
==========
Supplemental Disclosures of Cash Flow Information:
Cash paid during the year for:
Interest
$ - $ -
=============
========= Taxes
$ - $ -
============= ========= </TABLE>
- --------------------
The accompanying notes are an integral part of these financial
statements.
F-6
<PAGE>
AMERICAN URANIUM, INC.
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1999
1. THE COMPANY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The Company
American Uranium, Inc. (formerly Zencrest Holdings Corp., Inc.) (the
"Company") was formed in 1991 as a subsidiary of People Ridesharing
Systems, Inc. ("PRS") a company that filed for reorganization under
Chapter 11 of the Bankruptcy Act. As a result of an arrangement with
the Bankruptcy Court and PRS, ownership in the Company was to be
provided to the creditors and stockholders of PRS who received ten
percent and five percent, respectively, of the outstanding stock of
the Company upon the sale of the Company and in contemplation of a
merger. In addition, the Company sold eighty-five percent of the
Company's stock to nonaffiliated parties.
On August 26, 1998 the Company commenced operations by entering into
an agreement with Platoro West, LLC ("Platoro") concerning mineral
exploration activities. The Company's operations will be in the
identification, acquisition, exploration, development and extraction
of minerals, primarily focusing on uranium and vanadium claims
located in the United States. This agreement was terminated on May
31, 1999 (see Note 4, "Commitments and Contingencies").
Inventory
Inventory will be valued at cost as computed under the last-in,
first-out (LIFO) method which normally is lower than market. For the
type of inventory the Company intends to maintain, no segregation
among raw materials, work in process and finished goods will be
practicable.
Mineral Resource Assets
Mineral resource assets include costs associated with mineral
interests in properties and related equipment and facilities and
other facilities required for purposes of extraction.
Property, Plant and Equipment
Property, plant and equipment will include support equipment and
will be depreciated or amortized over the estimated useful life of
the assets.
Revenue Recognition
Revenue will be recognized upon shipment of the mined minerals.
Use of Management's 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.
F-7
<PAGE>
AMERICAN URANIUM, INC.
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1999
(Continued)
1. THE COMPANY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(Continued)
Income Taxes
The Company follows Statement of Financial Accounting Standards No.
109, "Accounting for Income Taxes" (SFAS 109). SFAS 109 requires the
recognition of deferred tax liabilities and assets for the expected
future tax consequences of events that have been included in the
financial statements or tax returns. Under this method, deferred tax
liabilities and assets are determined based on the difference
between the financial statement carrying amounts and tax bases of
assets and liabilities using enacted tax rates in effect in the
years in which the differences are expected to reverse. Valuation
allowances are established when necessary to reduce deferred tax
assets to the amount expected to be realized.
Impairment of Long-Lived Assets
The Company adopted Statement of Financial Accounting Standards No.
121 (SFAS 121), "Accounting for the Impairment of Long-Lived Assets
and for Long-Lived Assets to be Disposed of". SFAS 121 requires that
if facts and circumstances indicate that the cost of fixed assets or
other assets may be impaired, an evaluation of recoverability would
be performed by comparing the estimated future undiscounted pre-tax
cash flows associated with the asset to the asset's carrying value
to determine if a write-down to market value or discounted pre-tax
cash flow value would be required.
Comprehensive Income
For the year ended December 31, 1998, the Company adopted SFAS No.
130, "Reporting Comprehensive Income" (SFAS 130). This statement
establishes rules for the reporting of comprehensive income and its
components which require that certain items such as foreign currency
translation adjustments, unrealized gains and losses on certain
investments in debt and equity securities, minimum pension liability
adjustments and unearned compensation expense related to stock
issuances to employees be presented as separate components of
stockholders' equity. The adoption of SFAS 130 had no impact on
total stockholders' equity for either of the years presented in
these financial statements.
2. STOCKHOLDER LOANS
The Company was indebted to a principle stockholder in the amount of
$5,428 as of December 31, 1999. This loan is noninterest bearing and
is payable on demand.
F-8
<PAGE>
AMERICAN URANIUM, INC.
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1999
(Continued)
3. COMMON STOCK
The Company was incorporated on October 22, 1991 in the State of New
Jersey and has authority to issue, pursuant to an amendment to the
Company's certificate of incorporation on July 25, 1997, 100,000,000
$.001 par value shares of Common Stock. As a result of an
arrangement with the Bankruptcy Court and PRS, entered into on April
30, 1996, ownership in the Company was to be provided to the
creditors and stockholders of PRS who received 10 percent and 5
percent, respectively, of the outstanding common stock of the
Company upon the sale of the Company and in contemplation of a
merger, resulting in 10,000,000 shares of common stock outstanding.
On March 23, 1998, the Company effected a 1 for 4 reverse split of
the outstanding common stock resulting in a reduction of the issued
and outstanding shares from 10,000,000 to 2,500,261 which included
the issuance of 261 fractional shares. All outstanding share
information has been retroactively restated to give effect to the 1
for 4 reverse stock split.
During September 1998, the Company issued private placement
offerings to three individuals who were instrumental in identifying
worthy business opportunities. The private placement offering
resulted in the issuance of a total of 6,500,000 shares of the
Company's common stock at a price of $.02 per share. Total proceeds
of the private placement offerings were $130,000.
On December 18, 1998, the Company completed the sale of two other
private placement offerings and received $40,000 for which the
Company issued 40,000 shares of its common stock during January
1999. For financial statement presentation, the 40,000 shares have
been treated as issued and outstanding at December 31, 1998.
On January 14, 1999 the Company completed the sale of one additional
private placement offering and issued 18,000 shares of its common
stock, which resulted in total proceeds to the Company of $18,000.
4. COMMITMENTS AND CONTINGENCIES
As previously discussed in Note 1, on August 26, 1998 the Company
commenced operations by entering into an agreement with Platoro
concerning mineral exploration activities. The Company's operations
will be in the identification, acquisition, exploration, development
and extraction of minerals, primarily focusing on uranium and
vanadium claims located in the United States. The agreement with
Platoro called for Platoro to identify and stake eight (8) to ten
(10) good, marketable, mineral properties on behalf of the Company.
These properties were to be advanced stage properties with proven
resources located in the United States. The Company in return agreed
to pay the sum of $5,000 per month for an initial agreement period
of twenty-four (24) months plus out of pocket expenses, including
wages, travel and field expenses. The Company was also responsible
for all filing fees for the claims acquired by Platoro. In addition,
the Company was to issue four hundred thousand (400,000) shares of
common stock to Platoro upon the commencement of the trading of the
Company's common stock. During 1998 the Company successfully
acquired through staking one property which was identified by
Platoro pursuant to the agreement and this remains the only property
staked to date.
F-9
<PAGE>
AMERICAN URANIUM, INC.
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1999
(Continued)
4. COMMITMENTS AND CONTINGENCIES (Continued)
The agreement between the Company and Platoro was terminated on May
31, 1999 and each of the parties was relieved of any future
obligation under the agreement for consideration of $2 and other
good and valuable consideration paid by each of the parties to the
other. As part of this termination agreement, the Company agreed
that it would transfer title and claims of the staked site described
in Note 5 to Platoro if the Company elects not to make the required
payments to maintain the claims. Should the Company place the site
into production, the Company has agreed to pay Platoro a Net Smelter
Royalty within 10 business days following the receipt of any sale
proceeds. Net Smelter Royalty is 2% of cash sale proceeds after
deducting the cost of smelting and refining charges.
5. MINING PROPERTIES
Graysill Property, San Juan and Dolores Counties, Colorado
The Company acquired through staking a total of 24 unpatented lode
mining claims in Sections 19, 20, 29 and 30 in Township 40 North,
Range 9 West in San Juan and Dolores Counties, Colorado immediately
southeast of Bolam Pass. The claims were located on September 29,
1998 and the Company is required to make a payment of $1 per claim
by August 11th of each year on an ongoing basis in order to preserve
title to the property. The claims are located at an elevation of
11,000 feet above mean sea level and are accessible by a dirt road
that is maintained during the summer months by the United States
Forest Service. The property, which is referred to as the Graysill
Property, encompasses the historic Graysill Mine, a past producer of
vanadium and uranium ore. The production history of the Graysill
Mine is poorly documented but it is known to have produced vanadium
and byproduct uranium during an approximate twenty year period after
World War II. Before the mine ceased production, approximately
32,000 tons of ore were mined with a reported grade of 2.41%
vanadium pentoxide and 0.09% uranium oxide. In 1989, representatives
of the United States, Department of the Interior, Bureau of Mines
Division, examined a number of abandoned mines in the San Juan
National Forest, one of which was the Graysill Mine. Subsequently,
in 1992 the Bureau of Mines produced a Mineral Land Assessment Open
File Report titled "Mineral Appraisal of San Juan National Forest,
Colorado". Most of the information relating to the Graysill Mine and
the geology and mineralization of the general area within which the
Graysill Property is located was obtained from this Open File Report
unless stated otherwise.
The Graysill Property of American Uranium, Inc. is underlain by a
gently dipping assemblage of Paleozoic and Mesozoic sedimentary
rocks within which vanadium and uranium occurs in many of the rock
units in a stratabound manner exhibiting little or no apparent
relationship to regional structural trends. Although vanadium and
uranium occurrences are ubiquitous and are known to exist in over 20
distinctly different sedimentary units, the Uranium line property,
the Pennsylvanian Permian Rico Formation and the Upper Jurassic
Entrada Sandstone are the only formations which have been mined
previously for vanadium and uranium. Most of the past production has
come from the Entrada Sandstone. Historically, there have been a
number of uraniferous vanadium deposits developed in the Entrada
Sandstone along a sinuous trend extending in a north-south direction
for over 100 miles. This trend coincides with a major structural
feature representing a transitional zone between the Colorado
Plateau and the Southern Rocky Mountain physiographic provinces.
F-10
<PAGE>
AMERICAN URANIUM, INC.
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1999
(Continued)
5. MINING PROPERTIES (Continued)
During the past 50 years, the general region within which the
Company's property is located has been subjected to several periods
of extensive exploration. The major programs were carried out by
Vanadium Corporation of America during the late 1940's and early
1950's and by Atlas Corporation in the late 1970's. Although the
collective efforts of these companies resulted in the discovery and
definition of significant, high grade vanadium reserves containing a
high incidence of uranium, a major decline in the market for these
commodities in the early 1980's eliminated all interest in the area.
Concurrent with the height of exploration, uranium mining in the
project area was initiated on a small scale in the 1940's and peaked
in the late 1950's. Sporadic production of vanadium and uranium
continued into the 1970's. Based on reported grades, the total
production from the 32,000 tons of ore extracted from the Graysill
Mine amounted to approximately 52,000 pounds of uranium oxide and in
excess of 1,500,000 pounds of vanadium pentoxide before the mine
ceased operations presumably because of low vanadium and uranium
prices. Recently, Platoro West, LLC of Durango, Colorado acquired a
map which was prepared by Vanadium Corporation of America in 1950 at
a scale of 1 inch to 500 feet. The map outlines the location of a
large number of exploration holes that were drilled by Vanadium
Corporation of America and details the average grade and thickness
of vanadium mineralization that was encountered in each hole. Based
on this information and assuming continuity of the mineralization
between drill holes and a reasonable distance beyond drill holes,
Platoro West, LLC calculated a geological resource of 400,000 tons
averaging 2.5% vanadium pentoxide. Although the uranium content is
not shown on the map, it is the assumption of Platoro West, LLC that
a large resource of absorbed uranium is associated with the vanadium
mineralization since the drilling appears to have been designed to
extend the zone of vanadium and uranium mineralization at the
Graysill Mine. This equates to an inground resource of 20,000,000
pounds of Vanadium Pentoxide and possibly 6,400,000 pounds of
uranium oxide, providing the uranium grades at the Graysill Mine
accurately reflect the uranium content in the Graysill vanadium
deposit.
American Uranium, Inc., through Platoro West, LLC is in the process
of negotiating with Atlas Corporation to acquire all of the data
relating to the exploration they carried out in the Graysill area
during the 1970's. This information would enable American Uranium to
recalculate the vanadium and uranium reserves and would be
invaluable in designing further exploration work on the Graysill
Property.
Based on the results of the previous exploration on the property,
coupled with the widespread distribution of vanadium and uranium
within the Entrada Sandstone in the Graysill area, management
believes that it is highly likely that a significant increase in the
vanadium and uranium reserves can be attained with further
exploration on the property.
FINANCIAL DATA SCHEDULE
<TABLE> <S> <C>
[ARTICLE] 5
<S> <C>
[PERIOD-TYPE] 12-MOS
[FISCAL-YEAR-END] DEC-31-1999
[PERIOD-END] DEC-31-1999
[CASH] 29
[SECURITIES] 0
[RECEIVABLES] 0
[ALLOWANCES] 0
[INVENTORY] 0
[CURRENT-ASSETS] 1,885 [PP&E]
62,480 [DEPRECIATION]
0
[TOTAL-ASSETS] 66,818
[CURRENT-LIABILITIES] 10,913 [BONDS]
0
[COMMON] 0
[PREFERRED-MANDATORY] 0
[PREFERRED] 0
[OTHER-SE] 0
[TOTAL-LIABILITY-AND-EQUITY] 66,818 [SALES]
0
[TOTAL-REVENUES] 0
[CGS] 0
[TOTAL-COSTS] (40,774)
[OTHER-EXPENSES] 0
[LOSS-PROVISION] 0
[INTEREST-EXPENSE] 0
[INCOME-PRETAX] (40,774)
[INCOME-TAX] 0
[INCOME-CONTINUING] 0
[DISCONTINUED] 0
[EXTRAORDINARY] 0
[CHANGES] 0
[NET-INCOME] (40,774)
[EPS-BASIC] 0
[EPS-DILUTED] 0
</TABLE>
Exhibit B
Quarterly report on Form 10-QSB for the period ended March 31, 2000
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-SB
GENERAL FORM FOR REGISTRATION OF SECURITIES
OF SMALL BUSINESS ISSUERS UNDER SECTION 12(b)
OR 12(g) OF THE SECURITIES EXCHANGE ACT OF 1934
American Uranium, Inc.
(Exact Name of Small Business Issuer as Specified in Its
Charter)
New Jersey N/A -
----------------------
------------------------------------ (State of Incorporation)
(Issuer's I.R.S.
Employer I.D. Number) 133 Richmond Street, West
Suite # 311
Toronto, Ontario, Canada M5H 2L3 -
---------------------------------------- -----------
(Address of principal executive offices) (Zip Code)
(416) 203-2525
--------------------------------------------------
(Issuer's Telephone Number, Including Area Code)
Securities to be registered pursuant to Section 12(b) of
the Act: None
Securities to be registered pursuant to Section 12(g) of
the Act: Common Stock, $.001 par value per
share
<PAGE>
ITEM 1. DESCRIPTION OF BUSINESS
Introduction
American Uranium is engaged in the identification,
acquisition, exploration, development and extraction of minerals
primarily focused on uranium and vanadium claims located in the
United States.
American Uranium was organized under the laws of the State
of New Jersey on October 22, 1991 under the name PRS Sub III, Inc.
and changed its name to American Uranium Inc. in 1998. American
Uranium was originally formed as a subsidiary of People Ridesharing
Systems, Inc., a company which filed for reorganization under
Chapter 11 of the Bankruptcy Act. As a result of an order of the
United States Bankruptcy Court in May 1996 relating to the
bankruptcy of People Ridesharing, the common stock ownership in
American Uranium was issued 10% to the creditors and 5% to the
stockholders of People Ridesharing and 85% to an investor.
American Uranium has its executive offices or facilities at
133 Richmond Street, West, Suite # 311, Toronto, Ontario, Canada
M5H 2L3. Its telephone number is (416) 203-2525. American Uranium
was formerly named Zencrest Holdings Corp. Inc.
Overall Business Methodology
Identify and Acquire Uranium and Vanadium Properties
American Uranium has entered into an agreement with a
mineral exploration company, Platoro West LLC that owns a database
of geological exploration information on approximately 1,500
properties, the majority of which are located in the United States.
The database was acquired by Platoro as part of the liquidation of
certain mining subsidiaries of a major multinational chemical
company that was previously engaged in mineral exploration. The
database was compiled during the 1960's and 1970's, and it is
believed to contain exploration results and feasibility studies that
still have valuable, useful information. The agreement provides for
Platoro to identify eight to ten advanced stage properties with
proven reserves in the United States for American Uranium to stake
or otherwise acquire if interested. American Uranium views this
database as a substantial competitive advantage in the
identification of high quality mineral properties with significant
potential for full development.
American Uranium's initial plans are to acquire claims for
five to ten uranium and vanadium properties. During the initial
stages of operations, it intends to update exploration results and
feasibility studies for the most promising properties and begin the
permitting process on the properties that are determined to be the
most feasible for the extraction of minerals.
Update of Past Exploration Results and Feasibility Studies on Staked
Claims
Once American Uranium has identified properties and
acquired ownership of the claims, it will contract with external
geological and environmental consultants to update the exploration
results, feasibility studies and environmental reports to determine
if the properties can be permitted for full-scale mining. Each
property will be studied to determine the production price that will
support positive cash flow and that would be attractive to develop
using modern mining methods or to joint venture develop with a major
mineral producer. Claims that are not feasible to permit are not
renewed with the applicable federal and state authorities.
2
<PAGE>
Obtain Permits for Properties Identified as Feasible to Mine
American Uranium must undergo an extensive permitting
process prior to extracting minerals from feasible properties.
Operating and environmental permits will be obtained from the
applicable regulatory bodies utilizing technical applications filed
by American Uranium. American Uranium has identified external mining
consultants to assist with preparing and filing permits to all
applicable regulatory authorities in the United States. American
Uranium draws upon the significant mining experience of its
principal shareholders, officers and directors to ensure the best
resources are allocated to permitting and proper procedures are
followed.
Develop Mining Facilities and Extract Ore from Permitted Properties
American Uranium will use three approaches to mine
permitted properties: (i) develop the facilities to extract and
partially refine the ore and contract for later-stage refining with
third-party refiners, (ii) enter a joint venture agreement with a
major mineral producer to extract and refine the ore - American
Uranium will receive a percentage of the revenues from the sale of
refined ore, or (iii) sell the permitted property to a major mineral
producer. American Uranium will require significant capital to
manage and operate fully functional mines without the assistance of
a major mineral producer and does not view this as the preferred
option.
Mineral Ore Orientation
Recent acquisitions of uranium properties or junior uranium
mining and exploration companies by some major mineral producers has
resulted in American Uranium focusing on these particular minerals.
Uranium
Uranium, formally known as Uranium Oxide (U3O8), is
obtained from uranium concentrate commonly referred to as
"yellowcake". Uranium is used almost solely to fuel nuclear reactors
and is typically sold under long-term contracts. American Uranium
believes the price for yellowcake has the potential to strengthen
over the next decade for a number of reasons: (i) demand for uranium
will increase during the next decade as numerous new nuclear
reactors are built and brought on-line and (ii) world production
supplies approximately 55 percent of annual consumption with the
remainder supplied from inventory draw-downs -- current stockpiles
are estimated to contain only one year of reserves.
Uranium exploration and mining took hold in the 1950's and
1960's as demand for weapons grade nuclear material and nuclear
power began. These decades are depicted as a "uranium rush" as
numerous mines and processing mills were developed or built in the
major uranium producing countries across the world. The demand for
uranium continued into the 1970's and uranium prices peaked at $43
per pound in 1979. The uranium price increases continued to drive
production increases as new mines were developed throughout the
1970's. Stockpiles were set aside to meet expected future demand for
uranium. With the Three Mile Island disaster, the OPEC oil crisis
and consequent stabilization in demand for energy, and later the
Chernobyl disaster, interest in nuclear power dramatically declined.
Stockpiles continued to build-up during the early and mid-1980's as
production decreases did not match demand decreases. Since the
mid-1980's, uranium supplies have been plentiful and demand has
increased only slowly. Numerous mines and processing facilities have
been shut-down over the last 15
3
<PAGE>
years. Uranium prices reached a low in 1994 at $7 per pound. Since
that time (and for the factors indicated above), uranium prices have
began to rise.
Uranium ore is mined using one of three methods: (i)
traditional open-pit mining for shallow deposits, (ii) traditional
underground mining for deep deposits, and (iii) in-situ leaching for
specific sandstone-hosted deposits. Traditional mining methods use
labor and capital equipment to extract ore from the ground. The
in-situ leaching process uses oxygen that is added to native ground
water to react with uranium. Traditional mining methods are capital
intensive, difficult to obtain environmental permits for, and take
longer to bring on stream. The in-situ leaching process can be
started quickly, is considered environmentally benign, and has lower
operating costs. Heap leaching, a second leaching method, can be
used with traditional mining methods to reduce the handling of heavy
ore. Heap leaching uses chemicals that are distributed through piles
(heaps) of ore on the surface. The chemicals react with the uranium
in the ore, the solution is captured, and the uranium is recovered
from the chemicals. American Uranium is primarily focused on
obtaining claims for properties where leaching extraction methods
can be used.
Vanadium
Vanadium is a metal which is usually recovered as a
by-product from uranium fuel or non-fuel mineral deposits and
initially processed to a stable oxide, vanadium pentoxide (V2O5).
Most of the vanadium produced is then converted to a vanadium/iron
alloy, ferrovanadium, for use as an alloying addition to steel. The
economics of vanadium supply are largely dependent on the
exploitation of minerals which have a low vanadium content, such as
uranium, and there are very few mines that produce vanadium as the
sole or main product. Vanadium is also recovered from ashes, residue
and spent catalysts. The main single reason for the industrial use
of vanadium is that the addition of a small proportion to irons and
steels promotes grain refinement and precipitation hardening. This
allows for the production of high-strength, low alloy steels. The
iron and steel industry accounts for about 90 percent of total
consumption of vanadium.
As with most commodities, the price of vanadium is
dependent on the supply of the metal as well as the demand for its
end products. The price of vanadium pentoxide, which is typically
quoted in United States dollars per pound, peaked in the late 1980's
at approximately $11 per pound. American Uranium believes that the
price peak was driven by demand for iron and steel from all major
industrialized nations at the peak of the economic boom in the
1980's and prior to the global recession of the 1990's. American
Uranium believes the price will remain stable over the next decade
as the supply of vanadium will keep pace with the demand for iron
and steel.
Graysill Property, San Juan and Dolores Counties, Colorado
American Uranium acquired through staking a total of 24
unpatented lode mining claims in Sections 19, 20, 29 and 30 in
Township 40 North, Range 9 West in San Juan and Dolores Counties,
Colorado immediately southeast of Bolam Pass. The claims are located
at an elevation of 11,000 feet above mean sea level and are
accessible by a dirt road that is maintained during the summer
months by the United States Forest Service. The property, which is
referred to as the Graysill Property encompasses the historic
Graysill Mine, a past producer of vanadium and uranium ore. The
production history of the Graysill Mine is poorly documented, but it
is known to have produced vanadium and byproduct uranium during an
approximately twenty year period after World War II. Before the mine
ceased production, approximately 32,000 tons of ore were mined with
a reported grade of 2.41% vanadium pentoxide and 0.09% uranium
oxide. In 1989, representatives of the United States, Department of
the Interior, Bureau of Mines Division,
4
<PAGE>
examined a number of abandoned mines in the San Juan National
Forest, one of which was the Graysill Mine. Subsequently, in 1992
the Bureau of Mines produced a Mineral Land Assessment Open File
Report titled "Mineral Appraisal of San Juan National Forest,
Colorado". Most of the information relating to the Graysill Mine and
the geology and mineralization of the general area within which the
Graysill Property is located was obtained from this Open File Report
unless stated otherwise.
The property is underlain by a gently dipping assemblage of
Paleozoic and Mesozoic sedimentary rocks within which vanadium and
uranium occurs in many of the rock units in a stratabound manner,
exhibiting little or no apparent relationship to regional structural
trends. Although vanadium and uranium occurrences are ubiquitous and
are known to exist in over 20 distinctly different sedimentary units
in the vicinity of the property of American Uranium, the
Pennsylvanian-Permian Rico Formation and the Upper Jurassic Entrada
Sandstone are the only formations which have been mined previously
for vanadium and uranium. Most of the past production has come from
the Entrada Sandstone. Historically, there have been a number of
uraniferous vanadium deposits developed in the Entrada Sandstone
along a sinuous trend extending in a north-south direction for over
100 miles. This trend coincides with a major structural feature
representing a transitional zone between the Colorado Plateau and
the Southern Rocky Mountain physiographic provinces.
During the past 50 years, the general region within which
American Uranium's property is located has been subjected to several
periods of extensive exploration. The major programs were carried
out by Vanadium Corporation of America during the late 1940s and
early 1950s and by Atlas Corporation in the late 1970s. Although the
collective efforts of these companies resulted in the discovery and
definition of significant, high grade vanadium reserves containing a
high incidence of uranium, a major decline in the market for these
commodities in the early 1980s eliminated all interest in the area.
Concurrent with the height of exploration, uranium mining
in the project area was initiated on a small scale in the 1940s and
peaked in the late 1950s. Sporadic production of vanadium and
uranium continued into the 1970s. Incomplete production records from
the Graysill Mine, the largest producer in the area, indicate that a
total of 32,000 tons yielding approximately 52,000 pounds of uranium
oxide and in excess of 1.5 million pounds of vanadium pentoxide were
produced before the mine ceased operations because of low vanadium
and uranium prices. Based on an analyses of the results of the
drilling completed by Vanadium Corporation of America, Platoro West,
LLC calculated a geological resource of 400,000 tons averaging 2.5%
vanadium pentoxide. This ore body also contains large uranium
resources with an expected grade of 0.80%, the reported grade at the
Graysill Mine. This equates to an in ground resource of 20 million
pounds of vanadium pentoxide and 640,000 pounds of uranium oxide.
American Uranium, through Platoro West, LLC, is in the
process of negotiating with Atlas Corporation to acquire all of the
data relating to the exploration they carried out in the Graysill
area during the 1970s. American Uranium does not believe this will
be a material expense. This information would enable American
Uranium to recalculate the vanadium and uranium reserves on the
property and would be invaluable in designing further exploration
work in the Graysill area.
Based on the results of the previous exploration on the
property coupled with the widespread distribution of vanadium and
uranium within the Entrada Sandstone in the Graysill area, it is
highly likely that a significant increase in the vanadium and
uranium reserves can be attained with further exploration on the
property.
5
<PAGE>
Consulting Agreement with Platoro West LLC
On August 26, 1998 American Uranium commenced operations by
entering into an agreement with Platoro West LLC for it to conduct
mineral exploration activities. The agreement calls for Platoro to
identify and stake eight to ten good, marketable, mineral properties
on behalf of American Uranium. These properties are to be advanced
stage properties with proven resources located in the United States.
American Uranium pays Platoro the sum of $5,000 per month for an
initial agreement period of twenty-four months plus out of pocket
expenses, including wages, travel and field expenses. American
Uranium is also responsible for all filing fees for the claims
identified by Platoro. In addition, American Uranium will issue four
hundred thousand shares of common stock to Platoro as soon as public
trading of American Uranium's common stock commences. As of December
31, 1998 American Uranium has successfully acquired through staking
one property which was identified by Platoro pursuant to this
agreement.
Government Regulation
American Uranium will be subject to regulation by numerous
federal and state governmental authorities. The most significant
will be the Federal Environmental Protection Agency, the Bureau of
Land Management and comparable state agencies. American Uranium
expects that the regulation will cause it significant expense in its
operations, considerable time to meet and assure compliance and the
exposure to possible fines if it fails to meet the law or
regulation. Even if it employs others for extraction, milling and
production, American Uranium may bear some of these costs and/or
liabilities. To date, American Uranium has not been required to
spend anything on compliance with environmental laws because it is
not operating any mining assets.
Competition
American Uranium competes with numerous junior mining and
exploration companies to identify and acquire claims with strong
development potential and to engage the foremost geological and
environmental experts to assist with exploration, feasibility
studies and obtaining permits. American Uranium believes that its
contract with Platoro West, LLC to identify claims from a large
database of explored properties gives it a competitive advantage
over many other junior mining and exploration companies.
Furthermore, the experience and contacts of the officers and
directors of American Uranium lend credibility and attract attention
when contracting third party experts.
Employees
American Uranium had one employee as of May 1, 1999.
American Uranium expects to hire consultants and independent
contractors during the early stages of implementing its business plan.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
Forward Looking Statements
When used in this Form 10 and in future filings by American
Uranium with the Securities and Exchange Commission, the words or
phrases "will likely
6
<PAGE>
result," "management expects," or "American Uranium expects," "will
continue," "is anticipated," "estimated" or similar expressions are
intended to identify "forward-looking statements" within the meaning
of the Private Securities Litigation Reform Act of 1995. Readers are
cautioned not to place undue reliance on any such forward-looking
statements, each of which speak only as of the date made. These
statements are subject to risks and uncertainties, some of which are
described below. Actual results may differ materially from
historical earnings and those presently anticipated or projected.
American Uranium has no obligation to publicly release the result of
any revisions which may be made to any forward-looking statements to
reflect anticipated events or circumstances occurring after the date
of such statements.
Selected Financial Data
Because American Uranium is a development stage company,
selected financial date would not be meaningful. Reference is made
to the financial statements of American Uranium included elsewhere
in the document.
Fiscal Year 1997
American Uranium is a development stage company. Prior to
August 1997, it was an inactive subsidiary of People Ridesharing
Systems, Inc. Except for the initial recapitalization activity in
1997 as a result of the agreements among creditors, stockholders and
investors pursued in the context of the People Ridesharing
bankruptcy action, American Uranium did not conduct any activities
in the fiscal year ending December 31, 1997.
Fiscal Year 1998
American Uranium did not conduct any business during 1998
that resulted in revenues. All of its activities during 1998 were
devoted to establishing a business plan and conducting limited
financing activities to obtain initial working capital.
During 1998, American Uranium incurred general and
administrative expenses of $91,937. These expenses were principally
the costs associated with, consulting fees, lease expenses,
professional fees and salary of the president of the company. The
largest single amount was the cost of locating and staking the
Graysill Property and expenses associated with its mineral assets
which aggregated $53,039. The total expenses, offset by $616 of
interest, resulted in a loss for the fiscal year ended December 31,
1998 of $91,321. Funding of these expenses was from working capital.
Liquidity and Capital Requirements
The working capital of American Uranium at December 31,
1998 was $16,860. The working capital requirements of American
Uranium has been funded by the sale of securities. During 1998,
American Uranium sold 6,540,000 shares of common stock for an
aggregate of $170,000. In January 1999, American Uranium sold an
additional 18,000 shares of common stock for an aggregate of
$18,000. The proceeds of these sales were used for initial
developmental activities.
American Uranium will require additional financing to
continue to develop its business plan and to begin its
implementation. Management believes this amount will be substantial.
American Uranium currently has no sources of
7
<PAGE>
financing, including bank or private lending sources, or equity
capital sources. No assurance can be given that American Uranium
will be able to develop sources of financing in the future.
To implement the staking, evaluation, development and
extraction aspects of its business plan, American Uranium will need
substantial additional funding. Because these requirements are in
the more distant future, management has not yet begun to develop
methods of financing. Management expects that it will use equity,
debt and other arrangements, such as joint ventures, to fund these
stages of its business plan.
Year 2000
Overview
American Uranium has evaluated the potential impact of the
situation commonly referred to as the "Year 2000 Issue". Y2K
concerns the inability of information systems, primarily computer
software programs, to properly recognize and process date sensitive
information relating to the year 2000 and beyond. Many of the
world's computer systems currently record years in a two-digit
format. These computer systems will be unable to property interpret
dates beyond the year 1999, which could lead to business disruptions
in the U.S. and internationally. The potential costs and
uncertainties associated with Y2K will depend on a number of
factors, including software, hardware and the nature of the industry
in which a company operates.
Accounting Systems and Production Equipment
Because American Uranium has begun operations during the
later part of 1998, management believes that the computer programs
it purchases are Y2K compliant. At this time, management believes
that it does not have any assets with embedded computer chips or
programs. Mining data that American Uranium has acquired or may
purchase in the future is not subject to Y2K failure because it is
generally pure data without reference to aging or time change.
Therefore management does not expect to experience any Y2K failures.
Other Entity Compliance
American Uranium does not engage in electronic data
interchange with any other entity. Therefore, management believes it
does not have any Y2K exposure directly from other entities and
their failure to be Y2K compliant. Tangently, however, the failure
of other entities to be Y2K compliant may cause American Uranium
issues, none of which are yet apparent to management.
Contingency Planning
Management does not have a contingency plan for its
computer systems because it believes they are Y2K compliant or there
is no material risk. Management does not have a contingency plan in
the event a critical service, supplier or customer will not be Y2K
compliant. Management does not expect that their failure will have a
material impact because American Uranium is in the development stage
and uses few services, has few suppliers and has no customers. If
critical services such as utilities, communications or banking are
affected, operations of American Uranium will be disrupted.
8
<PAGE>
Cost of Year 2000 Compliance
American Uranium has not spent any amount on Y2K
compliance. It does not expect to have to spend any material amount
on Y2K compliance in the future.
Item 3. DESCRIPTION OF PROPERTY
Executive Offices
The executive office is located at 133 Richmond Street,
West, Suite # 311, Toronto, Ontario, Canada M5H 2L3 and its
telephone number is (416) 203-2525.
American Uranium believes that its current office is
adequate to meet its needs until it becomes more fully operational.
Mining Property
See the description of the Graysill Property, San Juan
and Dolores Counties, Colorado in Item 1. Business.
ITEM 4. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT
The following table sets forth information as of May 1,
1999 based on information obtained from the persons named below.
With respect to the beneficial ownership of shares of the common
stock of American Uranium by (1) each person known to be the owner
of more than 5% of the outstanding shares of common stock, (2) each
director and (3) all executive officers and directors as a group.
Percent of Number of Shares of
Ownership of Common
Stock Common Stock Name of Beneficial Owner
Beneficially* Owned Outstanding -
---------------------------- ---------------------
------------
G. Ken Webb . . . . . . . . . . 2,000,000(1)(2)
22.1% C.T. Yeh . . . . . . . . . . . - 0 -
- 0 - Stewart A. Jackson . . . . . . 2,000,000(1)(3)
22.1% Uranium Strategies, Inc. . . . 2,000,000(4)
22.1% Robert Landau . . . . . . . . .
1,800,000(5) 19.9% David Roff . . . . . . . . . .
1,800,000(5) 19.9% Thomas Skimming . . . . . .
. . 2,880,000(6) 31.8% Directors and officers
as a
group (3 persons) . . . . . . 2,000,000(7)
22.1%
- -------------------------------
* Beneficial ownership is determined in accordance with the
rules of the Securities and Exchange Commission and
generally includes voting or investment power with respect
to securities. Shares of common stock issuable upon the
exercise of options or warrants currently exercisable, or
exercisable or convertible within 60 days, are deemed outstanding
for computing the percentage ownership of the person holding
such options or warrants but are not deemed outstanding for
computing the percentage ownership of any other person.
9
<PAGE>
(1) The address for each of Messrs. Webb and Jackson is care-of
American Uranium at 133 Richmond Street, West, Third Floor,
Toronto, Ontario, Canada M5H 2L3.
(2) Mr. Webb is the chief executive officer, a director and a
principal shareholder of Uranium Strategies, Inc., and
consequently has beneficial ownership of the shares of common
stock of American Uranium owned by Uranium Strategies. Mr. Webb
disclaims beneficial ownership as to 1,480,000 shares of common
stock of American Uranium held by Uranium Strategies.
(3) Mr. Jackson is the Secretary and a director of Uranium
Strategies and consequently has beneficial ownership of the
shares of common stock of American Uranium owned by Uranium
Strategies. Mr. Jackson disclaims beneficial ownership as to
all the shares of common stock of American Uranium held by
Uranium Strategies.
(4) The address for Uranium Strategies, Inc. is 3550 Skyline View
Drive, Reno, Nevada 89509.
(5) The address for each of Messrs. Landau and Roff is 133 Richmond
Street, West, Suite # 401, Toronto, Ontario, Canada M5H 2L3.
(6) The address for Thomas Skimming is 11 Camelot Court, Toronto,
Ontario, Canada M3B 2N4.
(7) See Notes 2 and 3 above.
ITEM 5. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL
PERSONS
The current directors and officers of American Uranium are
as follows:
Name Age Position
- ------------------ -------
----------------------------------- G. Ken Webb 59
President, Chief Executive Officer,
Director (Chairman of the Board)
C.T. Yeh 60 Secretary, Director
Steward A. Jackson 59 Director
Mr. G. Ken Webb, has been the President, Chief Executive
Officer and a director of American Uranium since 1997. Mr. Webb has
over twenty years of experience in the Canadian junior mining
business. Mr. Webb has been involved predominantly within the
corporate finance area of the gold mining industry. From April 1996
to June 1997, Mr. Webb conducted investor relations for Central Asia
Goldfields, from November 1994 to February 1996, he was a consultant
to Webcon Equipment and from June 1991 to September 1994, he was a
consultant to Entre Capital. Mr. Webb holds a law degree from
Cambridge University, England. He is originally from South Africa,
where he completed his undergraduate studies at the University of
Natal, Pietermaritzburg. In a matter relating to a 1981 transaction
involving receipt of bonus shares, Mr. Webb's registration was
suspended in 1988 as an officer of a stock brokerage firm by the
Ontario Securities Commission for eighteen months, but was
subsequently reinstated.
10
<PAGE>
Mr. C.T. Yeh, has been the Secretary and a director of American
Uranium since 1997. Mr. Yeh has over 25 years of experience with
mining companies and financial services companies. From 1996 to
1997, Mr. Yeh was President of YCN Group, L.L.C., a joint venture
partner with Yang Cheng (Group) Co., Ltd., a Macau based company
wholly owned by the Municipality of Guangzhou, China. From 1992 to
1996, Mr. Yeh was Managing Director of Ridgewood Partners Ltd., an
investment banking company. From 1988 to 1992, Mr. Yeh was a
Director of Elders Resources Finance Inc., a merchant bank providing
capital to the junior mining companies. From 1979 to 1986, Mr. Yeh
was Director and Financial Planner of Inspiration Resources; from
1974 to 1979, was a Senior Process Economics Engineer at Kennecott
Copper; from 1969 to 1974, was a Metallurgist at Foote Minerals
Company; and from 1966 to 1969, Mr. Yeh was a Research Metallurgist
at Calumet & Hecla Company. Mr. Yeh holds a Bachelor of Science
degree in Metallurgical Engineering from Cheung Kung University, and
Master of Science degree in Metallurgical Engineering from Michigan
Technological University, and an M.B.A. with Honors from the
University of Delaware. Mr. Yeh holds several U.S. Patents in
Metallurgy and has written several research papers for the American
Institute of Metallurgical Engineers and the American Ceramic
Society. Mr. Yeh is a Director of Link Mineral Ventures Ltd., a
publicly traded company.
Dr. Stewart A. Jackson, has been the director of American
Uranium since 1997. Dr. Jackson is an experienced geologist with 37
years of experience in exploration and development of both base and
precious metal deposits. Dr. Jackson was responsible for the
discovery and development of several major mineral discoveries,
including the Red Dog multi-billion dollar zinc deposit in
northwestern Alaska for Cominco Resources, Inc. Dr. Jackson was
responsible for the raising of over $50 million for several publicly
traded companies, including for Crown Resource Corp. founded by him
in 1981. Since 1987 Dr. Jackson has been an independent consulting
geologist for several private and public companies. Dr. Jackson
earned a Bachelors of Science Degree majoring in Geology from the
University of Western Ontario and a Masters of Science majoring in
Stratigraphy and Mineral Deposit and a Doctorate from the University
of Toronto.
Messrs. Webb, Yeh and Jackson, officers and directors of
American Uranium may be deemed to be "promoters".
Board Meetings and Committees
During the fiscal year ended December 31, 1998, the board of
directors met on six occasions and took written action on six
occasions. All the members of the board of directors attended the
meeting. The written actions were by unanimous consent. The board of
directors has established no committees. Directors serve for a term
of one year after election or until their earlier resignation or
their successor is elected or appointed and qualified.
ITEM 6. EXECUTIVE COMPENSATION
Management Employment Agreements and Compensation
American Uranium currently pays a monthly salary of $2,500
to Mr. Webb, the president. This salary commenced May 1998. American
Uranium does not pay any of its other officers any salary. American
Uranium does not provide any other benefits to its officers.
American Uranium does not have any written agreements with any of
its officers and directors. Each of the officers and directors may
engage in other businesses, either individually or through
partnerships or
11
<PAGE>
corporations in which they have an interest, hold an office or serve
on boards of directors. All of the officers and directors may have
other business interests to which they devote their time.
Other Key Advisors and Consultants
American Uranium has access to several outside professional
firms which can counsel it and provide important advice in its
development stage. The terms of engagement of these firms will be
determined from time to time as their services are required. See
ITEM 1. Business for a description of the consulting agreement with
Platoro West, LLC.
Remuneration of the Board of Directors
Directors currently do not receive any compensation, but
will receive compensation for their services as determined in the
future by the board of directors. All directors are reimbursed for
any expense incurred in attending meetings of the board of directors.
Keyman Life Insurance
American Uranium does not own life insurance covering the
death of any officer, director or key employee.
ITEM 7. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
None.
ITEM 8. DESCRIPTION OF REGISTRANT'S SECURITIES TO BE REGISTERED
The authorized capital stock consists of 100,000,000 shares
of common stock, $0.001 par value. There are 9,058,261 shares of
Common Stock issued and outstanding. There are no options, warrants,
stock appreciation rights, or other rights similar in nature
outstanding which obligate American Uranium to issue any additional
common stock.
Common Stock
The holders of common stock are entitled to one vote per
share on all matters submitted to a vote of the shareholders of
American Uranium. In addition, such holders are entitled to receive
ratably such dividends, if any, as may be declared from time to time
by the board of directors out of funds legally available therefor.
In the event of the dissolution, liquidation or winding-up, the
holders of common stock are entitled to share ratably in all assets
remaining after payment of all liabilities of American Uranium and
subject to the prior distribution rights of any preferred stock that
may be outstanding at that time. The holders of common stock do not
have cumulative voting rights or preemptive or other rights to
acquire or subscribe for additional, unissued or treasury shares,
which means that the holders of more than 50% of such outstanding
shares, voting at an election of directors can elect all the
directors on the board of directors if they so choose and, in such
event, the holders of the remaining shares will not be able to elect
any of the directors. All outstanding shares of common stock are,
and when issued, the shares of common stock offered hereby, are
fully paid and non-assessable.
12
<PAGE>
Stock Transfer Agent
The stock transfer agent for the common stock is Olde
Monmouth Stock Transfer Co., Inc., 77 Memorial Parkway, 2nd Floor,
Atlantic Highlands, New Jersey 07716, telephone (732) 872-2727.
PART II
ITEM 1. MARKET PRICE OF AND DIVIDENDS ON THE REGISTRANT'S COMMON
EQUITY AND OTHER STOCKHOLDER MATTERS
Market Information
The common stock of American Uranium is not traded on any
stock exchange, any NASDAQ Stock Market medium or the "pink sheets".
Consequently, there is no public market for the common stock and no
market price data to report. American Uranium intends to obtain
inclusion on the OTC Bulletin Board in the future, but there can be
no assurance that the common stock will be included in the trading
medium. Even if inclusion in the OTC Bulletin Board is achieved,
there is no assurance that the common stock will be actively traded.
Therefore, there can be no assurance that there will be liquidity in
the common stock.
Currently, there are 9,040,261 shares of common stock
outstanding. Except as noted below, all of these shares may be sold
without restriction because they have been held either longer than
two years or issued in offerings under Rule 504, Regulation D.
2,000,000 shares of common stock are held by Uranium Strategies,
Inc. which is controlled by Mr. G. Ken Webb. These shares of common
stock are subject to restrictions on public resales as "control
shares". Certain other shares of common stock may also be considered
"control shares" depending on factual circumstances at the time of
sale. American Uranium currently does not have outstanding any
warrants or options.
Holders
As of May 1, 1999, there were 696 holders of record of the
common stock.
Dividend Policy
American Uranium has never declared or paid cash dividends
on its common stock and anticipates that all future earnings (for
the near future) will be retained for working capital and business
expansion. The payment of any future dividends will be at the sole
discretion of the board of directors and will depend upon, among
other things, future earnings, capital requirements, the company
financial condition and general business conditions. Therefore,
there can be no assurance that any dividends on the common stock
will be paid in the future.
ITEM 2. LEGAL PROCEEDINGS
None.
13
<PAGE>
ITEM 3. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
AND FINANCIAL DISCLOSURE
Samuel Klein and Company, certified public accountants were
engaged by American Uranium on November 5, 1998 as the independent
accountants. Prior to this engagement, American Uranium did not
engage any independent accountants to review its financial
statements because it was either inactive or in reorganization.
American Uranium is unaware of any disagreements or other issues
which are required to be disclosed by the rules and regulations
applicable to this Form 10.
ITEM 4. RECENT SALES OF UNREGISTERED SECURITIES
During September 1998, American Uranium directly sold an
aggregate of 6,500,000 shares of common stock to three individuals
in a private offering pursuant to Rule 506 of Regulation D. The
offering price was $.02 per share. The total proceeds of the
offering was $130,000. The proceeds were used for general working
capital purposes.
Under Rule 504, forming part of Regulation D, on December
18, 1998, American Uranium sold 40,000 shares of common stock to two
investors. The purchase price per share was $1.00, for aggregate
consideration of $40,000. These securities were sold by American
Uranium directly to the investors. The proceeds were used for
general working capital purposes.
Under Rule 504, forming part of Regulation D, on January 14,
1999, American Uranium sold 18,000 shares of common stock to one
investor. The price per share was $ 1.00 for aggregate consideration
of $18,000. These securities were sold by American Uranium directly
to the investors. The proceeds were used for general working capital
purposes.
ITEM 5. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 14A:3-5 of the Business Corporation Act of the State
of New Jersey provides for the indemnification of officers and
directors under certain circumstances against expenses and
liabilities incurred as a result of a claim against them as
corporate agents and requires New Jersey corporations to indemnify
their officers and directors against expenses incurred in legal
proceedings because of their being or having been an officer or a
director, if the corporate agent is successful in his defense on the
merits or otherwise in a proceeding against him.
Insofar as indemnification for liabilities arising under the
federal securities laws may be permitted to directors, officers and
controlling persons of American Uranium pursuant to the corporate
law of New Jersey or otherwise, American Uranium has been advised
that in the opinion of the Securities and Exchange Commission, such
indemnification is against public policy and is, therefore
unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by American Uranium of
expenses incurred by a director, officer or controlling person in
the successful defense of any action, suit or proceeding) is
asserted by such director, officer or controlling person in
connection with the securities being offered or sold, American
Uranium will, unless in the opinion of its counsel the matter has
been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question of whether such
indemnification by it is against public policy as expressed in the
Federal Securities laws, and will be governed by the final
adjudication of such case.
14
<PAGE>
American Uranium does not have any directors or officers
liability insurance.
PART F/S
The financial statements of American Uranium are included in
this report beginning on page F-1.
PART III
ITEM 1. INDEX TO EXHIBITS
(a) Exhibits
3.1* Certificate of Incorporation of the Registrant
3.2* By-laws of the Registrant
4.1* Form of Common Stock Certificate of Registrant
10.1* Consulting Agreement with Platoro West, LLC
<PAGE>
27.1* Financial Data Schedule
99.1* Risk Factors
* Filed herewith.
<PAGE>
FINANCIAL STATEMENTS
OF
AMERICAN URANIUM, INC.
(A CORPORATION IN THE DEVELOPMENT STAGE)
CONTENTS
PAGE
Independent Auditor's
Report.................................................F-2
Financial statements:
Balance
sheets............................................................F-3
Statements of
operations..................................................F-4
Statements of stockholders'
equity........................................F-5
Statements of cash
flows..................................................F-6
Notes to financial
statements.............................................F-7
F-1
<PAGE>
INDEPENDENT AUDITOR'S REPORT
To the Board of Directors and Stockholders
of American Uranium, Inc.
We have audited the accompanying balance sheets of American Uranium,
Inc. (formerly Zencrest Holdings Corp., Inc.) as of December 31,
1998 and 1997, and the related statements of operations,
stockholders' equity and cash flows for the years then ended. These
financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and perform
the audits to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of American
Uranium, Inc. as of December 31, 1998 and 1997, and the results of
its operations and its cash flows for the years then ended in
conformity with generally accepted accounting principles.
SAMUEL KLEIN AND
COMPANY
Newark, New Jersey
March 23, 1999
F-2
<PAGE>
AMERICAN URANIUM, INC.
BALANCE SHEETS
December 31,
1998
1997 ----
---- ASSETS
Current Assets:
Cash and cash equivalents $ 24,446 $
- Prepaid expenses 5,208
-
------------- --------------- Total Current Assets
29,654 -
Mineral Resource Assets 61,819
- -------------
---------------
Total Assets $ 91,473 $
- =============
==============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable and accrued expenses $ 12,794 $
- -----------
---------------
Total Current Liabilities 12,794
- ------------
----------------
Total Liabilities 12,794
- ------------
----------------
Stockholders' Equity:
Common stock, $.001 par value,
100,000,000 shares authorized,
9,040,261 and 2,500,261 shares
issued and outstanding at December
31, 1998 and 1997 9,040
2,500 Additional paid-in-capital 170,960
7,500 Accumulated deficit (101,321)
(10,000)
---------- --------- Total Stockholders' Equity
78,679 -
---------- ----------
Total Liabilities and Stockholders' Equity $ 91,473 $
- ===========
===========
- --------------------
The accompanying notes are an integral part of these financial
statements.
F-3
<PAGE>
AMERICAN URANIUM, INC.
STATEMENTS OF OPERATIONS
For the Years
Ended
December 31,
1998
1997 ----
----
Revenues $ - $
-
Cost of Revenues -
- ----------
---------
Gross Profit -
-
Other Costs:
General and administrative expenses 91,937
- ----------
--------- Total Other Costs 91,937
-
Other Income and Expense:
Interest income 616
- ----------
----------
Net Loss before Benefit from Income
Taxes (91,321)
-
Benefit from Income Taxes -
- ------------
-----------
Net Loss $ (91,321) $
- ===========
===========
- --------------------
The accompanying notes are an integral part of these financial
statements.
F4
<PAGE>
AMERICAN URANIUM, INC.
STATEMENTS OF STOCKHOLDERS' EQUITY
FOR THE YEARS ENDED DECEMBER 31, 1998 AND 1997
<TABLE>
<CAPTION>
Common Stock
$.001 Par Value
----------------------------
Common Additional Total
Number Stock
Paid-In- Accumulated Stockholders'
of Shares Amount
Capital Deficit Equity
----------- ------------
----------- ---------- ----------- <S>
<C> <C> <C>
<C> <C> Balances, January 1, 1997
2,500,261 $2,500 $ 7,500
$(10,000) $ -
Net Loss for the Year Ended
December 31, 1997 -
- - - -
------------
------------- ------------- ---------- ----------
Balances, December 31, 1997 2,500,261
2,500 7,500 (10,000) -
Issuance of Common Shares 6,540,000
6,540 163,460 - 170,000
Net Loss for the Year Ended
December 31, 1998 -
- - (91,321) (91,321)
-----------
------------- ------------- --------- ----------
Balances, December 31, 1998 $9,040,261
$9,040 $170,960 $(101,321) $ 78,679
===========
============ ============= ========== ==========
</TABLE>
- --------------------
The accompanying notes are an integral part of these financial
statements.
F-5
<PAGE>
AMERICAN URANIUM, INC.
STATEMENTS OF CASH FLOWS
For the Years
Ended
December 31, 1998
1997
---- ----
Cash Flows from Operating Activities:
Net loss $(91,321) $
-
Adjustments to reconcile net loss to
net cash used in operating activities:
Increase in prepaid expenses (5,208)
- Increase in accounts payable and
accrued expenses 12,794
- --------
----------
Net Cash Used in Operating
Activities (83,735)
- --------
----------
Cash Flows from Investing Activities:
Increase in Mineral Resource Assets (61,819)
- ----------
------------ Net cash used in investing
activities (61,819)
- ----------
------------
Cash Flows from Financing Activities:
Proceeds from the issuance of common
stock 170,000
- ---------
------------ Net Cash provided by financing
activities 170,000
- ---------
------------
Net Increase in Cash and Cash Equivalents 24,446
-
Cash and Cash Equivalents, beginning of year -
- ---------
------------
Cash and Cash Equivalents, end of year $ 24,446 $
- =========
============
- --------------------
The accompanying notes are an integral part of these financial
statements.
F-6
<PAGE>
AMERICAN URANIUM, INC.
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1998
1. THE COMPANY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The Company
American Uranium, Inc. (formerly Zencrest Holdings Corp., Inc.) (the
"Company") was formed in 1991 as a subsidiary of People Ridesharing
Systems, Inc. ("PRS") a company that filed for reorganization under
Chapter 11 of the Bankruptcy Act. As a result of an arrangement with
the Bankruptcy Court and PRS, ownership in the Company was to be
provided to the creditors and stockholders of PRS who received ten
percent and five percent, respectively, of the outstanding stock of
the Company upon the sale of the Company and in contemplation of a
merger. In addition, the Company sold eighty-five percent of the
Company's stock to nonaffiliated parties.
On August 26, 1998 the Company commenced operations by entering into
an agreement with Platoro West, LLC ("Platoro") concerning mineral
exploration activities. The Company's operations will be in the
identification, acquisition, exploration, development and extraction
of minerals, primarily focusing on uranium and vanadium claims
located in the United States.
Inventory
Inventory will be valued at cost as computed under the last-in,
first-out (LIFO) method which normally is lower than market. For the
type of inventory the Company intends to maintain, no segregation
among raw materials, work in process and finished goods will be
practicable.
Mineral Resource Assets
Mineral resource assets include costs associated with mineral
interest in properties and related equipment and facilities and
other facilities required for purposes of extraction.
Property, Plant and Equipment
Property, plant and equipment will include support equipment and
will be amortized over the estimated useful life of the assets.
Revenue Recognition
Revenue will be recognized upon shipment of the mined minerals.
Use of Management's 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.
F-7
<PAGE>
AMERICAN URANIUM, INC.
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1998
(Continued)
1. THE COMPANY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(Continued)
Income Taxes
The Company follows Statement of Financial Accounting Standards No.
109, "Accounting for Income Taxes" ("SFAS 109"). SFAS 109 requires
the recognition of deferred tax liabilities and assets for the
expected future tax consequences of events that have been included
in the financial statements or tax returns. Under this method,
deferred tax liabilities and assets are determined based on the
difference between the financial statement carrying amounts and tax
bases of assets and liabilities using enacted tax rates in effect in
the years in which the differences are expected to reverse.
Valuation allowances are established when necessary to reduce
deferred tax assets to the amount expected to be realized.
Impairment of Long-Lived Assets
The Company adopted Statement of Financial Accounting Standards No.
121 (SFAS 121), "Accounting for the Impairment of Long-Lived Assets
and for Long-Lived Assets to be Disposed of". SFAS 121 requires that
if facts and circumstances indicate that the cost of fixed assets or
other assets may be impaired, an evaluation of recoverability would
be performed by comparing the estimated future undiscounted pre-tax
cash flows associated with the asset to the asset's carrying value
to determine if a write-down to market value or discounted pre-tax
cash flow value would be required.
Comprehensive Income
For the year ended December 31, 1998, the Company adopted SFAS No.
130, Reporting Comprehensive Income ("SFAS 130"). This statement
establishes rules for the reporting of comprehensive income and its
components which require that certain items such as foreign currency
translation adjustments, unrealized gains and losses on certain
investments in debt and equity securities, minimum pension liability
adjustments and unearned compensation expense related to stock
issuances to employees be presented as separate components of
stockholders' equity. The adoption of SFAS 130 had no impact on
total stockholder's equity for either of the years presented in
these financial statements.
2. COMMON STOCK
The Company was incorporated on October 22, 1991 in the State of New
Jersey and has authority to issue, pursuant to an amendment to the
Company's certificate of incorporation on July 25, 1997, 100,000,000
$.001 par value shares of Common Stock. As a result of an
arrangement with the Bankruptcy Court and PRS, entered into on April
30, 1996, ownership in the Company was to be provided to the
creditors and stockholders of PRS who received 10 percent and 5
percent, respectively, of the outstanding common stock of the
Company upon the sale of the Company and in contemplation of a
merger, resulting in 10,000,000 shares of common stock outstanding.
On March 23, 1998, the Company effected a 1 for 4 reverse split of
the outstanding common stock resulting in a reduction of the issued
and outstanding shares from 10,000,000 to 2,500,261 which included
the issuance of 261 fractional shares. All outstanding share
information has been retroactively restated to give effect for the 1
for 4 reverse stock split.
F-8
<PAGE>
AMERICAN URANIUM, INC.
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1998
(Continued)
2. COMMON STOCK (Continued)
During September 1998, the Company issued private placement
offerings to three individuals who were instrumental in identifying
worthy business opportunities. The private placement offering
totaled 6,500,000 shares of the Company's common stock at a price of
$.02 per share. Total proceeds of the private placement offerings
were $130,000.
On December 18, 1998, the Company completed the sale of two private
placement offerings and received $40,000 for which the Company
issued 40,000 shares of its common stock during January 1999. For
financial statement presentation, the 40,000 shares have been
treated as issued and outstanding at December 31, 1998.
On January 14, 1999 the Company completed the sale of one additional
private placement offering and issued 18,000 shares of its common
stock, which resulted in total proceeds to the Company of $18,000.
3. COMMITMENTS AND CONTINGENCIES
On August 26, 1998 the Company commenced operations by entering into
an agreement with Platoro, already defined in Note 1, concerning
mineral exploration activities. The Company's operations will be in
the identification, acquisition, exploration, development and
extraction of minerals, primarily focusing on uranium and vanadium
claims located in the United States. The agreement with Platoro
calls for Platoro to identify and stake eight (8) to ten (10) good,
marketable, mineral properties on behalf of the Company.. These
properties are to be advanced stage properties with proven resources
located in the United States. The Company in return agrees to pay
the sum of $5,000 per month for an initial agreement period of
twenty-four (24) months plus out of pocket expenses, including
wages, travel and field expenses. The Company is also responsible
for all filing fees for the claims acquired by Platoro. In addition,
the Company will issue four hundred thousand (400,000) shares of
common stock to Platoro as soon as trading of the Company's common
stock commences. As of December 31, 1998 the Company has
successfully acquired through staking one property which was
identified by Platoro pursuant to this agreement.
F-9
<PAGE>
AMERICAN URANIUM, INC.
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1998
(Continued)
4. MINING PROPERTIES
Graysill Property, San Juan and Dolores Counties, Colorado
The Company acquired through staking a total of 24 unpatented lode
mining claims in Sections 19, 20, 29 and 30 in Township 40 North,
Range 9 West in Dolores and San Juan Counties, Colorado immediately
southeast of Bolam Pass. The claims were located on September 29,
1998 and the Company is required to make a payment of $1 per claim
by August 11th of each year on an ongoing basis in order to preserve
title to the property. The claims are located at an elevation of
11,000 feet above mean sea level and are accessible by a dirt road
that is maintained during the summer months by the United States
Forest Service. The property, which is referred to as the Graysill
Property encompasses the historic Graysill Mine, a past producer of
vanadium and uranium ore. The production history of the Graysill
Mine is poorly documented, but it is known to have produced vanadium
and byproduct uranium during an approximately twenty year period
after World War II. Before the mine ceased production, approximately
32,000 tons of ore were mined with a reported grade of 2.41%
vanadium pentoxide and 0.09% uranium oxide. In 1989, representatives
of the United States, Department of the Interior, Bureau of Mines
Division, examined a number of abandoned mines in the San Juan
National Forest, one of which was the Graysill Mine. Subsequently,
in 1992 the Bureau of Mines produced a Mineral Land Assessment Open
File Report titled "Mineral Appraisal of San Juan National Forest,
Colorado". Most of the information relating to the Graysill Mine and
the geology and mineralization of the general area within which the
Graysill Property is located was obtained from this Open File Report
unless stated otherwise.
The Graysill Property of American Uranium Inc. is underlain by a
gently dipping assemblage of Paleozoic and Mesozoic sedimentary
rocks within which vanadium and uranium occurs in many of the rock
units in a stratabound manner exhibiting little or no apparent
relationship to regional structural trends. Although vanadium and
uranium occurrences are ubiquitous and are known to exist in over 20
distinctly different sedimentary units, the Uranium line property,
the Pennsylvanian Permian Rico Formation and the Upper Jurassic
Entrada Sandstone are the only formations which have been mined
previously for vanadium and uranium. Most of the past production has
come from the Entrada Sandstone. Historically, there have been a
number of uraniferous vanadium deposits developed in the Entrada
Sandstone along a sinuous trend extending in a north-south direction
for over 100 miles. This trend coincides with a major structural
feature representing a transitional zone between the Colorado
Plateau and the Southern Rocky Mountain physiographic provinces.
During the past 50 years, the general region within which the
Company's property is located has been subjected to several periods
of extensive exploration. The major programs were carried out by
Vanadium Corporation of America during the late 1940's and early
1950's and by Atlas Corporation in the late 1970's. Although the
collective efforts of these companies resulted in the discovery and
definition of significant, high grade vanadium reserves containing a
high incidence of uranium, a major decline in the market for these
commodities in the early 1980's eliminated all interest in the area.
F-10
<PAGE>
AMERICAN URANIUM, INC.
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1998
(Continued)
4. MINING PROPERTIES (Continued)
Graysill Property, San Juan and Dolores Counties, Colorado
(Continued)
Concurrent with the height of exploration, uranium mining in the
project area was initiated on a small scale in the 1940's and peaked
in the late 1950's. Sporadic production of vanadium and uranium
continued into the 1970's. Based on reported grades, the total
production from the 32,000 tons of ore extracted from the Graysill
Mine amounted to approximately 52,000 pounds of uranium oxide and in
excess of 1,500,000 pounds of vanadium pentoxide before the mine
ceased operations presumably because of low vanadium and uranium
prices. Recently, Platoro West, LLC of Durango, Colorado acquired a
map which was prepared by Vanadium Corporation of America in 1950 at
a scale of 1 inch to 500 feet. The map outlines the location of a
large number of exploration holes that were drilled by Vanadium
Corporation of America and details the average grade and thickness
of vanadium mineralization that was encountered in each hole. Based
on this information, and assuming continuity of the mineralization
between drill holes and a reasonable distance beyond drill holes,
Platoro West, LLC calculated a geological resource of 400,000 tons
averaging 2.5% vanadium pentoxide. Although the uranium content is
not shown on the map, it is the assumption of Platoro West, LLC that
a large resource of absorbed uranium is associated with the vanadium
mineralization since the drilling appears to have been designed to
extend the zone of vanadium and uranium mineralization at the
Graysill Mine. This equates to an inground resource of 20,000,000
pounds of Vanadium Pentoxide and possibly 6,400,000 pounds of
uranium oxide, providing the uranium grades at the Graysill Mine
accurately reflect the uranium content in the Graysill vanadium
deposit.
American Uranium, Inc., through Platoro West, LLC is in the process
of negotiating with Atlas Corporation to acquire all of the data
relating to the exploration they carried out in the Graysill area
during the 1970's. This information would enable American Uranium to
recalculate the vanadium and uranium reserves and would be
invaluable in designing further exploration work on the Graysill
Property.
Based on the results of the previous exploration on the property,
coupled with the widespread distribution of vanadium and uranium
within the Entrada Sandstone in the Graysill area, management
believes that it is highly likely that a significant increase in the
vanadium and uranium reserves can be attained with further
exploration on the property.
5. YEAR 2000 ISSUES
The year 2000 issue arises because many computerized systems use two
digits rather than four to identify a year. Date-sensitive systems
may recognize the year 2000 as 1900 or some other date, resulting in
errors when information using 2000 dates is processed. In addition,
similar problems may arise in some systems which use certain dates
in 1999 to represent something other than a date. The effects of the
Year 2000 Issue may be experienced before, on, or after January 1,
2000, and, if not addressed, the impact on operations and financial
reporting may range from minor errors to significant systems failure
which could affect an entity's ability to conduct normal business
operations. It is not possible to be certain that all aspects of the
Year 2000 Issue affecting the Company, including those related to
the efforts of customers, suppliers, or third parties, will be fully
resolved.
F-11
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 12 of the Securities
Exchange Act of 1934, the registrant has duly caused this report to
be signed on its behalf by the undersigned, thereunto duly
authorized on the 10th day of May, 1999.
AMERICAN URANIUM, INC.
/s/ G. Ken Webb
---------------------
G. Ken Webb
President and
Chief Executive Officer
F-12
<PAGE>
CERTIFICATE OF INCORPORATION
Exhibit 3.1 CERTIFICATE OF INCORPORATION
OF
PRS SUB III INC.
To: The Secretary of State
State of New Jersey
The undersigned, of the age of eighteen years or over,
for the purpose of forming a corporation pursuant to the provisions
of Title 14A, Corporations, General, of the New Jersey Statutes,
does hereby execute the following Certificate of Incorporation.
(1) The name of the corporation is
PRS SUB III INC.
(2) The purpose or purposes for which the corporation
is organized are: To do any lawful act or thing for which
corporations may be organized pursuant to the provisions of Title
14A, Corporations, General, of the New Jersey Statutes.
(3) The aggregate number of shares which the
corporation shall have the authority to issue is 10 Million shares
each of which shall have $.001 par value.
(4) The address of the corporation's initial
registered office is 150 West State Street, Trenton, New Jersey 08608.
<PAGE>
The name of the corporation's initial registered agent
at such address is The Prentice-Hall Corporation System, New Jersey,
Inc.
(5) The number of directors constituting the initial
board of directors shall be one and the name and address is as
follows:
NAME
ADDRESS
John Frohling
Gateway 1
Suite 100
Newark, New Jersey 07102
(6) The name and address of the Incorporator is as
follows:
NAME
ADDRESS
Merridith E. Cramer 830 Bear
Tavern Road West
Trenton, New Jersey 08628
IN WITNESS WHEREOF, the undersigned of the above named
corporation, has hereunto signed this Certificate of Incorporation
this twenty-second day of October, 1991.
/s/ Merridith E. Cramer
-------------------------
Merridith E. Cramer
Incorporator
<PAGE>
New Jersey Department of State
Department of Commercial Recording
Certificate of Amendment to the
Certificate of Incorporation
(For Use by Domestic Profit Corporations)
"Federal Employer Identification No."
Pursuant to the provisions of Section 14A:9-(4) and Section
14A:9-4(3), corporations, General of the New Jersey Statutes,
the undersigned corporation executes the following Certificate
of Amendment to its Certificate of Incorporation:
1. The name of the corporation is PRS SUB III, INC.
2. The following amendment to the Certificate of Incorporation
was approved by the directors and thereafter duly adopted by
the shareholders of the corporation on the 18 day of July, 1997:
Resolved, that Article 3 of the Certificate of Incorporation
be amended to read as follows:
The aggregate number of shares which the corporation shall
have the authority to issue is: 100,000,000 par value
$.001.
3. The number of shares outstanding at the time of the adoption
of the amendment was 1000. The total number of shares entitled
to vote thereon was 1000.
If the shares of any class or series of shares are entitled to
vote thereon as a class, set forth below the designation and
number if outstanding shares entitled to vote thereon of each
such class or series. (Omit if not applicable).
4. The number of shares voting for and against such amendment is
as follows: (If the shares of any class or series are entitled
to vote as a class, set forth the number of shares of each
such class and series voting for and against the amendment,
respectively).
Number of Shares Voting Number of Shares
Voting for Amendment
Against Amendment -------------------------
------------------------ 1000
0
5. If the amendment provides for an exchange, reclassification or
cancellation of issued shares, set forth a statement of the
manner in which the same shall be effected. (Omit if not
applicable).
6. Other provisions: (Omit if not applicable).
PRS SUB III, INC.
--------------------
(Corporate Name)
By: /S John B.
Frohling
--------------------------
John B. M. Frohling, President
(Type Name and Title) Dated this 21st day of
July, 1997
<PAGE>
CERTIFICATE OF AMENDMENT
TO THE CERTIFICATE OF INCORPORATION
Pursuant to the provisions of N.J.S.A. 14A:9-2(4) and
14A:9-4(3), Corporations, General of New Jersey Statutes, the
undersigned corporation executes the following Certificate of
Amendment to its Certificate of Incorporation.
1. The name of the Corporation is PRS SUB III, INC.
2. The following amendment to the Certificate of
Incorporation was approved by the directors and
thereafter duly adopted by the shareholders of the
Corporation on the 9th day of October, 1997.
RESOLVED, that Article One of the Certificate of
Incorporation be amended to read as follows:
The name of the Corporation is Zencrest Holdings
Corp., Inc.
3. The number of shares outstanding at the time of the
adoption of the amendment was 10,000,000. The total
number of shares entitled to vote thereupon was
10,000,000, par value of $.001.
4. The number of shares voting for and against such
amendment is as follows:
Number of share Votes Number of share
Votes for Amendment Against
Amendment
10,000 -0-
5. Other provisions: NONE
Dated: October 9, 1998
PRS SUB II, INC.
By: /S John B.
Frohling
--------------------------
John B. M. Frohling, President
<PAGE>
CERTIFICATE OF AMENDMENT
TO THE CERTIFICATE OF INCORPORATION
Pursuant to the provisions of the N.J.S.A. 14A:9-2(4) and 14A:9-4(3)
Corporations, General of the New Jersey Statutes, the undersigned
corporation executes the following Certificate of Amendment of its
Certificate of Incorporation.
1. The name of the Corporation is : Zencrest Holdings, Corp.,
Inc.
2. The following amendment to the Certificate of Incorporation
was approved by the directors and thereafter duly adopted by
the shareholders of the Corporation on the 13th day of July,
1998.
RESOLVED, that Article One of the Certificate of Incorporation
be amended to read as follows:
The Name of the Corporation is American Uranium, Inc.
3. The number of shares outstanding at the time of the adoption
of the amendment was 2,500,000. The total number of shares
entitled to vote thereupon was 2,500,000, par value of $.001.
4. The number of shares voting for and against such amendment is as
follows:
Number of share Votes for Amendment
2,000,000
Number of share Votes against Amendment
-0-
Number of share Votes which abstained
500,000
5. Other provisions: NONE
Dated: August 24, 1998
Zencrest Holdings, Corp.,
Inc.
By: s/ G. Ken Webb
--------------------------------
G. Ken Webb, President
<PAGE>
Exhibit 3.2
BY-LAWS
OF
AMERICAN URANIUM INC.
(A New Jersey Corporation)
------------
ARTICLE I
SHAREHOLDERS
1. CERTIFICATES REPRESENTING SHARES. Certificates representing
shares shall set forth thereon prescribed by Section 14A:7-11, and,
where applicable, by Sections 14A:5-21 and 14A:12-5, of the New
Jersey Business Corporation Act and by any other applicable
provision of law and shall be signed by the Chairman or
Vice-Chairman of the Board of Directors, if any, or by the President
or Vice-President and may be counter signed by the Secretary or an
Assistant Secretary or the Treasurer or an Assistant treasurer and
may be sealed with the corporate seal or a facsimile thereof. Any or
all other signatures upon a certificate may be a facsimile. In case
any officer, transfer agent, or registrar who has signed or whose
facsimile signature has been placed upon such certificate shall have
ceased to be such officer, transfer agent, or registrar before such
certificate is issued, it may be issued by the corporation with the
same effect as if he were such officer, transfer agent, or registrar
at the date of its issue.
The corporation may issue a new certificate for shares in
place of any certificate theretofore issued by it, alleged to have
been lost or destroyed, and the Board of Directors may require the
owner of any lost or destroyed certificate, or his legal
representative, to give the corporation a bond sufficient to
indemnify the corporation against any claim that may be made against
it on account of the alleged loss or destruction of any such
certificate or the issuance of any such new certificate.
2. FRACTIONAL SHARE INTERESTS. Unless otherwise provided in its
certificate of incorporation, the corporation may, but shall not be
obliged to, issue fractions of a share and certificates therefor. By
action of the Board, the corporation may, in lieu of issuing
fractional shares, pay cash equal to the value of such fractional
share or issue scrip in registered or bearer form which shall
entitle the holder to receive a certificate for a full share upon
the surrender of such scrip aggregating a full share. A certificate
for a fractional share shall entitle the holder to exercise voting
rights, to receive dividends thereon, and to participate in any
distribution of assets of the corporation in the event of
liquidation, but scrip shall not entitle the holder to exercise such
voting rights, receive dividends or participate in any such
distribution of assets unless such scrip shall so provide. All scrip
shall be issued subject to the condition that it shall become void
if not exchanged for certificates representing full shares before a
specified date.
3. SHARE TRANSFERS. Upon compliance with provisions restricting the
transferability of shares, if any, transfers of shares of the
corporation shall be made only on the share record of the
corporation by the registered holder
<PAGE>
thereof, or by his attorney thereunto authorized by power of
attorney duly executed and filed with the Secretary of the
corporation or with a transfer agent or a registrar, if any, and on
surrender of the certificate or certificates for such shares
properly endorsed and the payment of all taxes due thereon, if any.
4. RECORD DATE FOR SHAREHOLDERS. The Board of Directors may fix, in
advance, a date as the record date for determining the shareholders
with regard to any corporate action or event and, in particular, for
determining the shareholders entitled to notice of or to vote at any
meeting of shareholders or any adjournment thereof; to give a
written consent to any action without a meeting; or to receive
payment of any dividend or allotment of any right. Any such record
date shall in no case be more than sixty days prior to the
shareholders' meeting or other corporate action or event to which it
relates. Any such record date for a shareholders' meeting shall not
be less than ten days before the date of the meeting. Any such
record date to determine shareholders entitled to give a written
consent shall not be more than sixty days before the date fixed for
tabulation of the consents or, if no date has been fixed for
tabulation, more than sixty days before the last day on which
consents received may be counted. If no such record date is fixed,
the record date for a shareholders' meeting shall be the close of
business on the day next preceding the day on which notice is given,
or, if no notice is given, the day next preceding the day on which
the meeting is held; and the record date for determining
shareholders for any other purpose shall be at the close of business
on the day on which the resolution of the Board of Directors
relating thereto is adopted. When a determination of shareholders of
record for a shareholders' meeting has been made as provided in this
section, such determination shall apply to any adjournment thereof,
unless the Board of Directors fixes a new record date under this
section for the adjourned meeting.
5. MEANING OF CERTAIN TERMS. As used herein in respect of the right
to notice of a meeting of shareholders or a waiver thereof or to
participate or vote thereat or to consent or dissent in writing in
lieu of a meeting, as the case may be, the term "share" or "shares"
or "shareholder" or "shareholders" refers to an outstanding share or
shares and to a holder or holders of record of outstanding shares
when the corporation is authorized to issue only one class of
shares, and said reference is also intended to include any
outstanding share or shares and any holder or holders of record of
outstanding shares of any class upon which or upon whom the
Certificate of Incorporation confers such rights where there are two
or more classes or series of shares or upon which or upon whom the
New Jersey Business Corporation Act confers such rights
notwithstanding that the Certificate of Incorporation may provide
for more than one class or series of shares, one or more of which
are limited or denied such rights thereunder.
6. SHAREHOLDER MEETINGS.
TIME. The annual meeting shall be held at the time fixed, from
the time to time, by the directors, provided that the first annual
meeting shall be held on a date within thirteen months after the
organization of the corporation, and each successive annual meeting
shall be held on a date within thirteen months after the date of the
preceding annual meeting. If, for any reason, the directors shall
fail to fix the time for an annual meeting, such meeting shall be
held at noon on the first Tuesday in November. A special meeting
shall be held on the date fixed by the directors.
PLACE. Annual meetings and special meetings shall be held at
such place, within or without the State of New Jersey, as the
directors may, from time to time, fix. Whenever the directors shall
fail to fix such place, the meeting shall be held at the registered
office of the corporation in the State of New Jersey.
<PAGE>
CALL. Annual meetings may be called by the directors or by the
President or by any officer instructed by the directors to call the
meeting. Special meetings may be called in like manner.
NOTICE OR ACTUAL OR CONSTRUCTIVE WAIVER OF NOTICE. Written
notice of every meeting shall be given, stating the time, place and
purpose or purposes of the meeting. If any action is proposed to be
taken which would, if taken, entitle shareholders to dissent and to
receive payment for their shares, the notice shall include a
statement of that purpose and to that effect. The notice of every
meeting shall be given, personally or by mail, and, except as
otherwise provided by the New Jersey Business Corporation Act, not
less than ten days or more than sixty days before the date of the
meeting, unless the lapse of the prescribed period of time shall
have been waived before or after the taking of any action, to each
shareholder at his record address or at such other address which he
may have furnished by request in writing to the Secretary of the
corporation. Notice by mail shall be deemed to be given when
deposited, with postage thereon prepaid, in a post office or
official depository under the exclusive care and custody of the
United States Post Office Department. When a meeting is adjourned to
another time or place, it shall not be necessary to give notice of
the adjourned meeting if the time and place to which the meeting is
adjourned are announced at the meeting at which the adjournment is
taken and at the adjourned meeting only such business is transacted
as might have been transacted at the original meeting. However, if
after the adjournment the directors fix a new record date for the
adjourned meeting, a notice of the adjourned meeting shall be given
to each shareholder on the new record date.
Notice of a meeting need not be given to any shareholder who
submits a signed waiver of notice before or after the meeting. The
attendance of a shareholder at a meeting without protesting prior to
the conclusion of the meeting the lack of notice of such meeting
shall constitute a waiver of notice of him.
VOTING LIST. The officer or agent having charge of the stock
transfer books for shares of the corporation shall make and certify
a complete list of the shareholders entitled to vote at
shareholders' meeting or any adjournment thereof. Any such list may
consist of cards arranged alphabetically or any equipment which
permits the visual display of the information required by the
provisions of Section 14A:5-8 of the New Jersey Business Corporation
Act. Such list shall be arranged alphabetically within each class,
series, if any, or group of shareholders maintained by the
corporation for convenience of reference, with the address of, and
the number of shares held by, each shareholder; be produced (or
available by means of a visual display) at the time and place of the
meeting; be subject to the inspection of any shareholder for
reasonable periods during the meeting; and be prima facie evidence
as to who are the shareholders entitled to examine such list or to
vote at such meeting.
CONDUCT OF MEETING. Meetings of the shareholders shall be
presided over by one of the following officers in the order of
seniority and if present and acting - the chairman of the Board, if
any, the Vice Chairman of the Board, if any, the President, a Vice
President, or, if none of the foregoing is in office and present and
acting, by a chairman to be chosen by the shareholders. The
Secretary of the corporation, or in his absence, an Assistant
Secretary, shall act as secretary of every meeting, but if neither
the Secretary nor an Assistant Secretary is present the Chairman of
the meeting shall appoint a secretary of the meeting.
PROXY REPRESENTATION. Every shareholder may authorize another
person or persons to act for him by proxy in all matters in which a
shareholder is entitled to participate, whether by waiving notice of
or the lapse of the prescribed period of time before any meeting,
voting or participating at a
<PAGE>
meeting, or expressing consent without a meeting. Every proxy must
be signed by the shareholder or his agent, except that a proxy may
be given by a shareholder or his agent by telegram or cable or by
any means of electronic communication which results in a writing. No
proxy shall be valid for more than eleven months unless a longer
time is expressly provided therein. Unless it is irrevocable as
provided in subsection 14A:5-19(c) of the New Jersey Business
Corporation Act a proxy shall be revocable at will. The grant of a
later proxy revokes any earlier proxy unless the earlier proxy is
irrevocable. A proxy shall not be revoked by the death or incapacity
of the shareholder, but the proxy shall continue to be in force
until revoked by the personal representative or guardian of the
shareholder. The presence at any meeting of any shareholder who has
given a proxy does not revoke the proxy unless the shareholder files
written notice of the revocation with the Secretary of the meeting
prior to the voting of a proxy or votes the shares subject to the
proxy by written ballot. A person named in a proxy as the attorney
or agent of a shareholder may, if the proxy so provides, substitute
another person to act in his place, including any other person named
as an attorney or agent in the same proxy. The substitution shall
not be effective until an instrument effecting it is filed with the
Secretary of the corporation.
INSPECTORS - APPOINTMENT. The directors, in advance of any
meeting, or of the tabulation of written consents of shareholders
without a meeting may, but need not, appoint one or more inspectors
to act at the meeting or any adjournment thereof or to tabulate such
consents and make a written report thereof. If an inspector or
inspectors to act at any meeting of shareholders are not so
appointed by the directors or shall fail to qualify, if appointed,
the person presiding at the shareholders' meeting may, and on the
request of any shareholder entitled to vote thereat, shall, make
such appointment. In case any person appointed as inspector fails to
appear or act, the vacancy may be filled by appointment made by the
directors in advance of the meeting, or at the meeting by the person
presiding at the meeting. Each inspector appointed, if any, before
entering upon the discharge of his duties, shall take and sign an
oath faithfully to execute the duties of inspector with strict
impartiality and according to the best of his ability. No person
shall be elected a director in an election for which he has served
as an inspector. The inspectors, if any, shall determine the number
of shares outstanding and the voting power of each, the shares
represented at the meeting, the existence of a quorum, the validity
and effect of proxies, and shall receive votes or consents, hear and
determine all challenges and questions arising in connection with
the right to vote, count and tabulate all votes or consents,
determine the result, and do such acts as are proper to conduct the
election or vote with fairness to all shareholders. If there are
three or more inspectors, the act of a majority shall govern. On
request of the person presiding at the meeting or any shareholder
entitled to vote thereat, the inspectors shall make a report in
writing of any challenge, question or matter determined by them. Any
report made by them shall be prima facie evidence of the facts
therein stated, and such report shall be filed with the minutes of
the meeting.
QUORUM. Except for meetings ordered by the Superior court to
be called and held pursuant to Sections 14A:5-2 and 14A:5-3 of the
New Jersey Business Corporation Act, the holders of the shares
entitled to cast at least a majority of the votes at the meeting
shall constitute a quorum at the meeting of shareholders for the
transaction of business.
The shareholders present may continue to do business until
adjournment, notwithstanding the withdrawal of enough shareholders
to leave less than a quorum. Less than a quorum may adjourn.
VOTING. Each share shall entitle the holder thereof to one
vote. In the election of directors, a plurality of the votes shall
elect, and no election need be by ballot unless a shareholder
demands the same before the voting
<PAGE>
begins. Any other action shall be authorized by a majority of the
votes cast except where the New Jersey Business Corporation Act
prescribes a different proportion of votes.
7. SHAREHOLDER ACTION WITHOUT MEETINGS. Subject to any limitations
prescribed by the provisions of Section 14A:5-6 of the New Jersey
Business Corporation Act and upon compliance with said provisions,
any action required or permitted to be taken at a meeting of
shareholders by the provisions of said Act or by the Certificate of
Incorporation or these By-Laws may be taken without a meeting if all
of the shareholders entitled to vote thereon consent thereto in
writing and (except for the annual election of directors) may also
be taken by less than all of the shareholders who would have been
entitled to cast the minimum number of votes which would be
necessary to authorize any such action at a meeting at which all
shareholders entitled to vote thereon were present and voting.
Whenever any action is taken pursuant to the foregoing provisions,
the written consents of the shareholders consenting thereto or the
written report of the inspectors appointed to tabulate such consents
shall be filed with the minutes of proceedings of shareholders.
ARTICLE II
GOVERNING BOARD
1. FUNCTIONS, DEFINITIONS AND COMPENSATION. The business and affairs
of the corporation shall be managed and conducted by or under the
direction of a governing body, which is herein referred to as the
"Board of Directors" or `directors" notwithstanding that the members
thereof may otherwise bear the titles of trustees, managers, or
governors or any other designated title. The word "director" or
"directors" likewise herein refers to a member or to members of the
governing board notwithstanding the designation of a different
official title or titles. The use of the phrase "entire board"
herein refers to the total number of directors which the corporation
would have if there were no vacancies. The Board of Directors, by
the affirmative vote of a majority of directors in office and
irrespective of any personal interest of any of them, shall have
authority to establish reasonable compensation of directors for
services to the corporation as directors, officers or otherwise.
2. QUALIFICATIONS AND NUMBER. Each director shall be at least
eighteen years of age. A director need not be a shareholder, a
citizen of the United States, or a resident of the State of New
Jersey. The number of directors of the corporation shall be not less
than three(3) nor more than seven(7). The directors shall have power
from time to time, in the interim between annual and special
meetings of the shareholders, to increase or decrease their number
within the minimum and maximum number hereinbefore prescribed.
3. ELECTION AND TERM. The first Board of Directors shall hold office
until the first annual meeting of shareholders and until their
successors have been elected and qualified. Thereafter, directors
who are elected at an annual meeting of shareholders, and directors
who are elected in the interim to fill vacancies and newly created
directorships, shall hold office until the next succeeding annual
meeting of shareholders and until their successors have been elected
and qualified. In the interim between annual meetings of
shareholders or of special meetings of shareholders called for the
election of directors, newly created directorships and any existing
vacancies in the Board of Directors, including vacancies resulting
from the removal of director for cause or without cause, may be
filled by the affirmative vote of the remaining directors,
<PAGE>
although less than a quorum exists or by the sole remaining
director. A director may resign by written notice to the
corporation. The resignation shall be effective upon receipt thereof
by the corporation or at such subsequent time as shall be specified
in the notice of resignation. When one or more directors shall
resign from the Board of Directors effective at a future date, a
majority of the directors then in office, including those who have
so resigned, shall have power to fill such vacancy or vacancies, the
vote thereon to take effect when such resignation or resignations
shall become effective.
4. REMOVAL OF DIRECTORS. One or more or all of the directors of the
corporation may be removed for cause or without cause by the
shareholders. The Board of Directors shall have the power to remove
directors for cause and to suspend directors pending a final
determination that cause exists for removal.
5. MEETINGS.
TIME. Meetings shall be held at such time as the Board shall
fix, except that the first meeting of a newly elected Board shall be
held as soon after its election as the directors may conveniently
assemble.
PLACE. Meetings shall be held at such place within or without
the State of New Jersey as shall be fixed by the Board.
CALL. No call shall be required for regular meetings for which
the time and place have been fixed. Special meetings may be called
by or at the direction of the Chairman of the Board, if any, of the
President, or of a majority of the directors in office.
NOTICE OR ACTUAL OR CONSTRUCTIVE WAIVER. No notice shall be
required for regular meetings for which the time and place have been
fixed. Written, oral or any other mode of notice of the time and
place shall be given for special meetings in sufficient time for the
convenient assembly of the directors thereat. The notice of any
meetings need not specify the business to be transacted at, or the
purpose of , the meeting. Any requirement of furnishing a notice
shall be waived by any director who signs a waiver of notice before
or after the meeting, or who attends the meeting without protesting,
prior to the conclusion of the meeting, the lack of notice to him.
Notice of an adjourned meeting need not be given if the time and
place are fixed at the meeting adjourning, and if the period of
adjournment does not exceed ten days in any one adjournment.
QUORUM AND ACTION. Each director shall have one vote at
meetings of the Board of Directors. The participation of directors
with a majority of the votes of the entire Board shall constitute a
quorum for the transaction of business. Any action approved by a
majority of the votes of directors present at a meeting at which a
quorum is present shall be the act of the Board of Directors unless
the New Jersey Business Corporation Act requires a greater
proportion. Where appropriate communication facilities are
reasonably available, any or all directors shall have the right to
participate in all or any part of a meeting of the Board of
Directors or a committee of the Board of Directors by means of
conference telephone or any means of communication by which all
persons in the meeting are able to hear each other.
CHAIRMAN OF THE MEETING. The Chairman of the Board, if any and
if present, shall preside at all meetings. Otherwise, the President,
if present, or any other director chosen by the Board, shall preside.
<PAGE>
6. COMMITTEES. The Board of Directors, by resolution adopted by a
majority of the entire Board of Directors, may appoint from among
its members one or more directors to constitute an Executive
Committee and one or more other committees, each of which , to the
extent provided in the resolution appointing it, shall have and may
exercise all of the authority of the Board of Directors with the
exception of any authority the delegation of which is prohibited by
Section 14A:6-9 of the New Jersey Business Corporation Act. Actions
taken at a meeting of any such committee shall be reported to the
Board of Directors at its next meeting following such committee
meeting; except that, when the meeting of the Board is held within
two days after the committee meeting, such report shall, if not made
at the first meeting, be made to the Board at its second meeting
following such committee meeting. Each director of a committee shall
have one vote at meetings of that committee. The participation of
directors with the majority of the votes of a committee shall
constitute a quorum of that committee for the transaction of
business. Any action approved by a majority of the votes of
directors of a committee present at a meeting of that committee at
which a quorum is present shall be the act of the committee unless
the New Jersey Business Corporation Act requires a greater proportion.
7. WRITTEN CONSENT. Any action required or permitted to be taken
pursuant to authorization voted at a meeting of the Board of
Directors or any committee thereof may be taken without a meeting,
if, prior or subsequent to the action, all members of the Board of
Directors or of such committee, as the case may be, consent thereto
in writing and such written consents are filed with the minutes of
the proceedings of the Board of Directors or committee. Such consent
shall have the same effect as an unanimous vote of the Board of
Directors or committee for all purposes and may be stated as such in
any certificate or other document filed with the Secretary of State
of the State of New Jersey.
ARTICLE III
OFFICERS
The directors shall elect a President, a Secretary, and a
Treasurer, and may elect a Chairman of the Board, a Vice-Chairman of
the Board, one or more Vice-Presidents, Assistant Vice-Presidents,
Assistant Secretaries, and Assistant Treasurers, and such other
officers and agents as they shall determine. The President may but
need not be a director. Any two or more offices may be held by the
same person but no officer shall execute, acknowledge, or verify any
instrument in more than one capacity if such instrument is required
by law to be executed, acknowledged, or verified by two or more
officers.
Unless otherwise provided in the resolution of election, each
officer shall hold office until the meeting of the board of
Directors following the next annual meeting of shareholders and
until his successor has been elected and qualified.
Officers shall have the powers and duties defined in the
resolutions appointing them.
The Board of Directors may remove any officer for cause or
without cause. An officer may resign by written notice to the
corporation. The resignation shall be effective upon receipt thereof
by the corporation or at such subsequent time as shall be specified
in the notice of resignation.
DUTIES AND AUTHORITY OF PRESIDENT. The president shall be
chief executive officer of the Corporation. Subject only to the
authority of the Board, he shall have general charge and supervision
over, and responsibility for, the business
<PAGE>
and affairs of the Corporation. Unless otherwise directed by the
Board, all other officers shall be subject to the authority and
supervision of the president. The president may enter into and
execute in the name of the Corporation contracts or other
instruments in the regular course of business or contracts or other
instruments not in the regular course of business which are
authorized, either generally or specifically, by the Board. He shall
have the general powers and duties of management usually vested in
the office of president of a corporation.
DUTIES AND AUTHORITY OF VICE PRESIDENT. The vice president
shall perform such duties and have such authority as from time to
time may be delegated to him by the president or by the Board. In
the absence of the president or in the event of his death,
inability, or refusal to act, the vice president shall perform the
duties and be vested with the authority of the president.
DUTIES AND AUTHORITY OF TREASURER. The treasurer shall have
the custody of the funds and securities of the Corporation and shall
keep or cause to be kept regular books of account for the
Corporation. The treasurer shall perform such other duties and
possess such other powers as are incident to that office or as shall
be assigned by the president or the Board.
DUTIES AND AUTHORITY OF SECRETARY. The secretary shall cause
notices of all meetings to be served as prescribed in these by-laws
and shall keep or cause to be kept the minutes of all meetings of
the shareholders and the Board. The secretary shall have charge of
the seal of the Corporation. The secretary shall perform such other
duties and possess such other powers as are incident to that office
or as are assigned by the president of the Board.
ARTICLE IV
REGISTERED OFFICE, BOOKS AND RECORDS
The address of the initial registered office of the
corporation in the State of New Jersey, and the name of the initial
registered agent at said address, are set forth in the original
Certificate of Incorporation of the corporation
The corporation shall keep books and records of account and
minutes of the proceedings of its shareholders, Board of Directors,
and the Executive Committee and other committee or committees, if
any. Such books, records and minutes may be kept within or outside
the State of New Jersey. The corporation shall keep at its principal
office, or at the office of its transfer agent, or at its registered
office, a record or records containing the names and addresses of
all shareholders, the number, class, and series of shares held by
each and the dates when they respectively became the owners of
record thereof. Any of the foregoing books, minutes, or records may
be in written form or in any other form capable of being converted
into readable form within a reasonable time.
ARTICLE V
CORPORATE SEAL
The corporate seal shall be in such form as the Board of
Directors shall prescribe.
<PAGE>
ARTICLE VI
FISCAL YEAR
The fiscal year of the corporation shall be fixed, and shall
be subject to change, by the Board of Directors.
ARTICLE VII
CONTROL OVER BY-LAWS
On and after the date upon which the first Board of Directors
shall have adopted the initial corporate By-Laws, which shall be
deemed to have been adopted by the shareholders for the purposes of
the New Jersey Corporation Act, the power to make, alter, and repeal
the By-Laws of the corporation may be exercised by the directors or
the shareholders; provided, that any By-Laws made by the Board of
Directors may be altered or repealed, and new By-Laws made, by the
shareholders.
Dated May 3, 1999
<PAGE>
Exhibit 4.1 Form of Common Stock Certificate
Incorporated under the Laws of the
State of New Jersey
Number
Shares
American Uranium, Inc.
100,000,000 Shares, Par Value $.001
Common Stock
This is to certify that _____________ is the owner of
____________ fully paid and non-assessable shares of the above
Corporation, transferable only on the books of the Corporation, by
the holder hereof in person or by duly authorized attorney upon
surrender of their certificate properly endorsed.
Witness, the seal of the corporation and the
signatures of its duly authorized officers.
_________________,Secretary [SEAL]
____________________, President
<PAGE>
EXHIBIT 10.1 LETTER OF INTENT
Platoro
West, LLC
P.O. Box 12650
Prescott, AZ 86304
Tel. (520) 541-9250
August 17, 1998
Mr. Ken Webb, President
Zencrest Holdings Inc.
105 Spring Garden Avenue
Toronto, Ontario
Canada M2N 3G4
Dear Ken,
This letter, when acknowledged by your signature below, will
serve as a letter of intent between Platoro West, LLC and Zencrest
Holdings Inc. concerning mineral exploration activities. Platoro
agrees to identify and stake 8 to 10 good, marketable, uranium
properties for Zencrest, or its successors, during the initial term
of the agreement. These properties will be advanced stage properties
with proven resources and will be in the United States. In
consideration of the foregoing, Zencrest agrees to the following:
1. Zencrest will pay $5,000.00 per month for an initial
agreement period of twenty four months.
2. The agreement will be renewable by mutual consent for
successive yearly terms.
3. Zencrest will pay direct travel and field expenses
including day wages for field assistance as well as mileage at the
allowed U.S. Internal Revenue Service rate.
4. Zencrest will pay all filing fees for any claims acquired
on its behalf.
5. Zencrest will pay $1,500.00 per month for a full time
employee to staff the data warehouse of Platoro's associated
company, Wolfranium Resource Corporation.
6. Zencrest will provide Platoro with a 0.5% NSR on any
properties which are vended to another company whereby Zencrest's
resulting participation in the claims is less than 35%.
7. Zencrest will pay Platoro or its associates four hundred
thousand free trading shares of Zencrest Holdings Inc. as soon as
the company is up and trading. Furthermore, one hundred thousand
shares of Zencrest Holdings Inc. of the 1,600,000 control block will
be held for Platoro or its associates in Uranium Strategies Inc. The
initial start of Zencrest will have less than ten million common
shares issued and the Platoro holdings will represent slightly more
than five percent of the total issued stock in Zencrest Holdings
Inc.
<PAGE>
8. Zencrest will maintain all acquired properties in good
standing and will return them to Platoro under any of the following
circumstances:
(a) Insolvency of Zencrest.
(b) If the claims are no longer of interest to
Zencrest.
(c) If the claims are not actively explored,
developed, or joint-ventured within 36 months following the date of
acquisition of the claims.
If these terms are acceptable to Zencrest Holdings Inc.,
please indicate your acceptance of the above by signing in the space
below.
AGREED TO THIS ___26___ DAY OF __AUGUST_____,1998:
/s/ William M. Sheriff /s/ Ken Webb -
-------------------------
-------------------- William M. Sheriff
Ken Webb Vice President Exploration
President Platoro West, LLC
Zencrest Holdings Inc.
<PAGE>
EXHIBIT 99.1
RISK FACTORS
Dated May 1, 1999
You should consider the following risks, as well as those
described in any other public filing by American Uranium or in any
investor document distributed by American Uranium, before an
investment is made in the company. The risks below are not the only
possible risks. Additional ones may also impair the business
operations of American Uranium. If any one or more of these risks
happen, the business, results of operations or financial condition
will be impaired. There may be a concomitant adverse effect on the
value of the securities of American Uranium and you may lose part or
all of your investment.
American Uranium is in the development stage and has no history of
operations on which to base investment decisions about it.
American Uranium is in the development stage. Although
incorporated in 1991, it has not engaged in any substantive
operations to date, most of its activities being related to
formation, initial capitalization and the acquisition of one
potential mining property. Businesses which are starting up or in
their initial stages of development present substantial business and
financial risks and suffer significant losses from which they may
not recover. American Uranium will face all of the challenges of a
new business enterprise, including but not limited to, engaging the
services of qualified support personnel and consultants,
establishing budgets, implementing appropriate financial controls
and internal operating policies and procedures. Because the company
is new, there is little history on which to judge the financial
condition or potential success of American Uranium.
American Uranium has limited capital and will need additional
financing to implement its business plan.
American Uranium currently has limited operating capital.
It will require substantial amounts of additional capital to
continue its business and to develop its business as intended.
American has never paid any dividends and does to intend to do so in
the future.
American Uranium has neither paid or declared any
dividends, nor, by reason of its present financial status and its
contemplated financial requirements, does it anticipate paying any
dividends in the foreseeable future. The future payment of dividends
on the common stock, if any, rests within the sole discretion of the
board of directors. Any determination to pay dividends in the future
will depend on, among other things, the earnings, capital
requirements and financial condition of American Uranium.
<PAGE>
American Uranium has no operating history as a mining company;
therefore it is dependant on others for the implementation of its
business plan in the early stages.
American Uranium has no operating history as a mining,
prospecting or assaying company. To initially locate and obtain
mining properties, it is relying on an outside consultant. American
Uranium also will rely on other consultants and independent
contractors in its development stages to implement its business
plan. These stages will include staking, evaluation, permitting or
licensing and assessment activities. No assurance can be given that
current and future employed persons will have the experience and
skills to successfully execute the proposed business plan in the
context of the enterprise.
The business of mining has many inherent risks of operations which
may prevent ultimate success.
The business of mineral exploration, development and
production involves significant risks. It depends on, amongst other
things, successful location of minable reserves and skillful
management. Mineral deposits and ore grades may vary substantially,
rendering what was initially believed a profitable deposit of little
or no value. Profitable mining of ore bodies can be affected by
unforeseen changes in operating circumstances, ore reserves and
technical issues. Substantial investment is often required before
viable deposits are located and brought into production. Mining is
subject to a number of hazards including rock falls, subsidence,
cave-ins, flooding and other weather conditions. Insurance for some
or all of these hazards may be too expensive or not available.
Production can also be affected by unanticipated changes in
permitting requirements, environmental factors, change in law, work
interruptions, operating circumstances, unexpected changes in the
quality or quantity of reserves, unstable or unexpected ground
conditions and technical issues. Therefore, American Uranium may
have to bear unforeseen and extraordinary expenses. No assurance can
be given that American Uranium will have the financial resources or
insurance in the event of these or other hazards befall it.
American Uranium will rely on dated geological reports that it
believes are public information to locate potential mining
properties which may be inaccurate or being used by others.
American Uranium plans to rely on publicly available
geological reports and databases to locate potential mining stakes
or leases. If these reports and databases prove to be protected by
trade secret laws and the like, it may incur liability. Because the
reports are typically several decades old, there is no sure method
of verifying the care and manner used to prepare them without
further verification by American Uranium and its agents.
Verification is expected to be costly. Decisions made without
adequate checking could result in significant unrecoverable
expenses. No assurance can be given that other persons are not using
the same or similar reports and databases resulting in others
identifying and staking claims prior to American Uranium taking
similar action.
American Uranium will rely on others to perform extractive services,
with all the inherent risks of employing others for important
functions.
The business plan anticipates that American Uranium will
identify, stake, evaluate and permit potential mining sites and the
extractive, milling and production will be contracted to others in
one or all of these fields. American Uranium will rely on
consultants and independent contractors to be
<PAGE>
available and to work in the appropriate manner to realize the value
of the natural resources. No assurance can be given that American
Uranium will be able to locate contractors with which it will work,
within acceptable fee arrangements and that these entities will
extract the full value of the resources. American Uranium may also
be at risk for any violations of law and permits of the persons it
uses to conduct the extractive, milling and production tasks.
American Uranium will depend on its current officers to carry it
through the development stages, and their loss would have a severe
impact on its future.
Because of their many years of experience in the mining
fields, American Uranium is dependent upon the continuing services
of its president and other officers. The loss of services of any key
individuals will have a negative impact. There also is the risk that
their unique services might not be replaceable at fees that American
Uranium can afford. Without the services of the existing management
team, the growth, progress, and overall success of American Uranium
may be adversely affected.
Regulatory compliance is complex and the failure to meet all the
various requirements could result in fines or other limitations on
the proposed business of American Uranium.
American Uranium will be subject to regulation by numerous
Federal and state governmental authorities, but most importantly, by
the Federal Environmental Protection Agency, the Bureau of Land
Management, and comparable state agencies. The failure or delay in
obtaining regulatory approvals or licenses will adversely affect
American Uranium's ability to extract and to market ores and
processed products. These failures also will affect the ability of
American Uranium to generate mining revenues. Although American
Uranium does not anticipate problems satisfying any of the
regulations involved in its business, American Uranium cannot
foresee the possibility of new regulations which could adversely
affect its business.
The current management has voting control over the common stock;
therefore they can determine the direction of American Uranium.
The current officers, directors and principal shareholders
own a majority of the outstanding common stock. The shareholders of
American Uranium do not have the right of cumulative voting for the
election of directors. Accordingly, the existing principal
shareholders are and will continue to be able to elect all of the
directors of American Uranium and control its affairs.
The majority of the outstanding shares of common stock may be traded
without registration; hence there may be market overhang resulting
in an illiquid market.
Most of the shares of common stock have been issued for
periods longer than two year and other shares of common stock have
been issued under exemptions that afforded them the status of free
trading shares. Most of these shares were purchased for very small
per share amounts. As a result, most of the shares may be sold by
the holders in the public market if and when it develops. Some
shares are held by officers, directors and other affiliates which
may be sold only subject to volume and timing limitations. The
amount of shares that can be sold may have an impact on the market
by causing it to be illiquid for fear of market makers having to buy
large amounts of these securities from long time holders and related
parties.
<PAGE>
Business issues resulting from the Year 2000 problem may have an
impact on some business systems of American Uranium.
Because American Uranium is commencing operations in the
business environment where the issues resulting from Year 2000
non-compliance have been discussed and are being addressed, it does
not expect that there will be any adverse consequence to it. To the
extent that vendors of services and date sensitive data are not
compliant, American Uranium will be impacted, but it does not expect
the effect to be material. American Uranium does not have any
information systems of its own that are not Year 2000 compliant.
<PAGE>
FINANCIAL DATA SCHEDULE
<TABLE> <S> <C>
[ARTICLE] 5
<S> <C>
[PERIOD-TYPE] 12-MOS
[FISCAL-YEAR-END] DEC-31-1998
[PERIOD-START] JAN-01-1998
[PERIOD-END] DEC-31-1998
[CASH] 24,446
[SECURITIES] 0
[RECEIVABLES] 5,208
[ALLOWANCES] 0
[INVENTORY] 0
[CURRENT-ASSETS] 29,654
[PP&E] 0
[DEPRECIATION] 0
[TOTAL-ASSETS] 91,423
[CURRENT-LIABILITIES] 12,794
[BONDS] 0
[COMMON] 9,040
[PREFERRED-MANDATORY] 0
[PREFERRED] 0
[OTHER-SE] 170,960
[TOTAL-LIABILITY-AND-EQUITY] 91,443
[SALES] 0
[TOTAL-REVENUES] 0
[CGS] 0
[TOTAL-COSTS] 91,937
[OTHER-EXPENSES] 0
[LOSS-PROVISION] 0
[INTEREST-EXPENSE] 0
[INCOME-PRETAX] 0
[INCOME-TAX] 0
[INCOME-CONTINUING] 0
[DISCONTINUED] 0
[EXTRAORDINARY] 0
[CHANGES] 0
[NET-INCOME] (91,321)
[EPS-BASIC] 0
[EPS-DILUTED] 0
</TABLE>
Exhibit C
The Merger Agreement
AGREEMENT AND PLAN OF MERGER
THIS AGREEMENT AND PLAN OF MERGER dated May 19, 2000 (the
"Agreement"), is entered into between AMERICAN URANIUM
REINCORPORATION, INC., a Florida corporation ("American Uranium
Florida"), and AMERICAN URANIUM, INC., a New Jersey corporation
("American Uranium New Jersey").
BACKGROUND:
A. American Uranium New Jersey has an aggregate authorized capital
of one hundred million (100,000,000) shares, consisting of
100,000,000 shares of common stock, $.001 par value per share (the
"New Jersey Common Stock"), and no shares of Preferred Stock (the
New Jersey Preferred Stock"). On May 19, 2000, there were 9,058,261
shares of New Jersey Common Stock and no Shares of New Jersey
Preferred Stock issued and outstanding.
B. American Uranium Florida has an aggregate authorized capital of
one hundred million (100,000,000) shares, consisting of 100,000,000
shares of common stock, $.001 par value per share (the "Florida
Common Stock"), and no shares of Preferred Stock, (the Florida
Preferred Stock"). On May 19, 2000 there were 100 shares of Florida
Common Stock and no Shares of Florida Preferred Stock issued and
outstanding.
C. The respective Boards of Directors of American Uranium Florida
and American Uranium New Jersey believe that the best interests of
American Uranium Florida and American Uranium New Jersey and their
respective shareholders will be served by the merger of American
Uranium New Jersey with and into American Uranium Florida under and
pursuant to the provisions of this Agreement and the New Jersey
Business Corporation Act (the "New Jersey Act") and the Florida
Business Corporation Act (the "Florida Act").
TERMS:
In consideration of the mutual agreements contained in this
Agreement, the parties hereto agree as set forth below.
1. Merger. American Uranium New Jersey shall be merged with
and into American Uranium Florida (the "Merger").
2. Effective Date. The Merger shall become effective
immediately upon the later of the filing of this Agreement or a
certificate of merger with the Secretary of State of New Jersey in
accordance with the New Jersey Act and the filing of articles of
merger with the Secretary of State of Florida in accordance with the
Florida Act. The time of such effectiveness is hereinafter called
the "Effective Date."
3. Surviving Corporation. American Uranium Florida shall be
the surviving corporation of the Merger and shall continue to be
governed by the laws of the State of Florida. On the Effective
Date, the separate corporate existence of American Uranium New
Jersey shall cease.
4. Name of Surviving Corporation. On the Effective Date, the
Articles of Incorporation of American Uranium Florida shall be
amended to change the name of American Uranium Florida to "American
Uranium, Inc."
5. Articles of Incorporation. Except as provided in
Paragraph 4, the Articles of Incorporation of American Uranium
Florida as it exists on the Effective Date shall be the Articles of
Incorporation of American Uranium Florida immediately following the
Effective Date, unless and until the same shall thereafter be
amended or repealed in accordance with the laws of the State of
Florida.
6. Bylaws. The Bylaws of American Uranium Florida as they
exist on the Effective Date shall be the Bylaws of American Uranium
Florida immediately following the Effective Date, unless and until
the same shall be amended or repealed in accordance with the
provisions thereof and the laws of the State of Florida.
7. Board of Directors and Officers. The members of the Board
of Directors and officers of American Uranium New Jersey immediately
prior to the Effective Date shall be members of the Board of
Directors and the officers, respectively, of American Uranium
Florida following the Effective Date, and such persons shall serve
in such positions for the terms provided by law or in the Bylaws, or
until their respective successors are elected and qualified.
8. Retirement of Outstanding Florida Stock. On the Effective
Date, each of the 100 shares of the Florida Common Stock presently
issued and outstanding shall be retired, and no shares of Florida
Common Stock or other securities of American Uranium Florida shall
be issued in respect thereof.
9. Conversion of Outstanding American Uranium New Jersey
Stock. On the Effective Date, each issued and outstanding share of
the New Jersey Common Stock and all rights in respect thereof shall
be converted into one fully-paid and nonassessable share of Florida
Common Stock, and each certificate representing shares of New Jersey
Common Stock shall for all purposes be deemed to evidence the
ownership of the same number of shares of Florida Common Stock as
are set forth in such certificate. After the Effective Date, each
holder of an outstanding certificate representing shares of New
Jersey Common Stock may, at such shareholder's option, surrender the
same to American Uranium Florida's registrar and transfer agent for
cancellation, and each such shareholder shall be entitled to receive
in exchange therefore a certificate(s) evidencing the ownership of
the same number of shares of Florida Common Stock as are represented
by the American Uranium New Jersey certificate(s) surrendered to
American Uranium Florida's registrar and transfer agent.
10. Stock Options and Warrants. On the Effective Date, each
stock option, stock warrant, and other right to subscribe for or
purchase shares of New Jersey Common Stock shall be converted into a
stock option, stock warrant, or other right to subscribe for or
purchase the same number of shares of Florida Common Stock, and each
certificate, agreement, note or other document representing such
stock option, stock warrant, or other right to subscribe for or
purchase shares of New Jersey Common Stock shall for all purposes be
deemed to evidence the ownership of a stock option, stock warrant,
or other right to subscribe for or purchase shares of Florida Common
Stock.
11. Rights and Liabilities of American Uranium Florida. On
and after the Effective Date, and all in the manner of and as more
fully set forth in the Florida Act and the New Jersey Act:
(a) the title to all real estate and other property, or
any interest therein, owned by each of American Uranium New Jersey
and American Uranium Florida shall be vested in American Uranium
Florida without reversion or impairment;
(b) American Uranium Florida shall succeed to and
possess, without further act or deed, all estates, rights,
privileges, powers and franchises, both public and private, and all
of the property, real, personal and mixed, of each of American
Uranium New Jersey and American Uranium Florida without reversion or
impairment;
(c) American Uranium Florida shall thenceforth be
responsible and liable for all the liabilities and obligations of
each of American Uranium New Jersey and American Uranium Florida;
(d) any claim existing or action or proceeding pending by
or against American Uranium New Jersey or American Uranium Florida
may be continued as if the Merger did not occur or American Uranium
Florida may be substituted for American Uranium New Jersey in the
proceeding;
(e) neither the rights of creditors nor any liens upon
the property of American Uranium New Jersey or American Uranium
Florida shall be impaired by the Merger; and
(f) American Uranium Florida shall indemnify and hold
harmless the officers and directors of each of the parties to this
Agreement against all such debts, liabilities and duties and against
all claims and demands arising out of the Merger.
12. Termination. This Agreement may be terminated and
abandoned by action of the respective Boards of Directors of
American Uranium New Jersey and American Uranium Florida at any time
prior to the Effective Date, whether before or after approval by the
shareholders of either or both of the parties to this Agreement.
13. Amendment. The Boards of Directors of American Uranium
New Jersey and American Uranium Florida may amend this Agreement at
any time prior to the Effective Date; provided that an amendment
made subsequent to the approval of this Agreement by the
shareholders of either of American Uranium New Jersey or American
Uranium Florida shall not:
(a) change the amount or kind of shares, securities,
cash, property or rights to be received in exchange for or on
conversion of all or any of the shares of the parties hereto;
(b) change any term of the Articles of Incorporation of
American Uranium Florida; or
(c) change any other terms or conditions of this
Agreement if such change would adversely affect the holders of any
capital stock of either American Uranium New Jersey and American
Uranium Florida.
14. Registered Office. The registered office of American
Uranium Florida in the State of Florida is located at 5100 Town
Center Circle, Suite 330, Boca Raton, Florida 33486 and EHG
Registered Agents, Inc., is the registered agent of Florida at such
address.
15. Inspection of Agreement. Executed copies of this
Agreement will be on file at the principal place of business of
American Uranium Florida at 121 Richmond Street West, 7th Floor,
Toronto, Ontario M5H 2K1 Canada. A copy of this Agreement shall be
furnished by American Uranium Florida, on request and without cost,
to any shareholder of either American Uranium New Jersey or American
Uranium Florida.
16. Governing Law. This Agreement shall in all respects be
construed, interpreted and enforced in accordance with and governed
by the laws of the State of Florida.
17. Service of Process. On and after the Effective Date,
American Uranium Florida agrees that it may be served with process
in New Jersey in any proceeding for enforcement of any obligation of
American Uranium New Jersey or American Uranium Florida arising from
the Merger.
18. Designation of New Jersey Secretary of State as Agent for
Service of Process. On and after the Effective Date, American
Uranium Florida irrevocably appoints the Secretary of State of New
Jersey as its agent to accept service of process in any suit or
other proceeding to enforce the rights of any shareholders of
American Uranium New Jersey or American Uranium Florida arising from
the Merger. The New Jersey Secretary of State is requested to mail
a copy of any such process to American Uranium Florida at 121
Richmond Street West, 7th Floor, Toronto, Ontario M5H 2K1 Canada,
Attention: Glen Akselrod, President.
IN WITNESS WHEREOF, each of the parties to this Agreement,
pursuant to authority duly granted by their respective Board of
Directors, has caused this Agreement to be executed as of the date
first written above.
American Uranium, Inc.
By:
Glen Akselrod, President
Attest:
CT Yeh, Secretary
American Uranium Reincorporation,
Inc.
By:
Glen Akselrod, President
Attest:
CT Yeh, Secretary
Exhibit D
The Florida Articles
ARTICLES OF INCORPORATION
OF
AMERICAN URANIUM REINCORPORATION, INC.
The undersigned, incorporator for purposes of forming a
corporation under the Florida Business Corporation Act, hereby
adopts the following Articles of Incorporation:
ARTICLE I
CORPORATE NAME
The name of the corporation is American Uranium
Reincorporation, Inc. (the "Corporation").
ARTICLE II
INITIAL ADDRESS
The initial street address and mailing address of the principal
office of the Corporation is:
133 Richmond Street West, Third Floor
Toronto, Ontario M5H 2L3
Canada
ARTICLE III
CAPITALIZATION
The aggregate number of shares that the Corporation shall have
authority to issue is One Hundred Million (100,000,000) shares, par
value of $.001 and which shares shall be designated as "Common
Stock". Each share of Common Stock shall entitle the holder
thereof to one vote. No holder of the Common Stock shall be
entitled to any right of cumulative voting.
ARTICLE IV
REGISTERED AGENT
The registered agent and street address of the initial
registered office of the Corporation is:
E.H.G. Resident Agents, Inc.
5100 Town Center Circle, Suite 330
Boca Raton, Florida 33486
ARTICLE V
INCORPORATOR
The name and address of the Incorporator of the Corporation is:
Glen Akselrod
133 Richmond Street West, Third Floor
Toronto, Ontario M5H 2L3
Canada
ARTICLE VI
CORPORATE AUTHORITY
The corporation is organized for the purpose of transacting any
and all lawful activities or business for which corporations may be
formed under the Florida Business Corporations Act.
ARTICLE VII
DIRECTORS
The corporation shall have one director and the number of
directors may be increased or diminished from time to time as
provided in the Bylaws of the Corporation but shall never be less
than one.
ARTICLE VIII
BYLAWS
The initial Bylaws of the corporation shall be adopted by the
Board of Directors. In furtherance of and not in limitation of the
power conferred upon the Board of Directors by law, the Board of
Directors shall have power to make, adopt, alter, amend and repeal
from time to time Bylaws of the Corporation, subject to the right of
the stockholders to alter and repeal Bylaws made by the Board of
Directors.
ARTICLE IX
CONFLICTS
No contract or transaction between the Corporation and one or
more of its directors or officers or between the Corporation and any
other corporation, partnership, association or other organization in
which one or more of its directors or officers are directors or
officers or have a financial interest, shall be void or voidable
solely for this reason, or solely because the directors or officers
are present at or participate in the meeting of the board or
committee thereof which authorizes the contract or transaction, or
solely because the directors or officers or their votes are counted
for such purpose.
ARTICLE X
DIRECTOR AND OFFICER INDEMNIFICATION
Each person who was or is made a party or is threatened to be
made a party to or is otherwise involved in any action, suit or
proceeding, whether civil, criminal or administrative, (hereinafter
a "Proceeding"), or is contacted by any governmental or regulatory
body in connection with any investigation or inquiry (hereinafter an
"Investigation"), by reason of the fact that such person is or was a
director or executive officer (as such term is utilized pursuant to
interpretations under Section 16 of the Securities Exchange Act of
1934) of the corporation or is or was serving at the request of the
corporation as a director, officer, employee or agent of another
corporation or of a partnership, joint venture, trust or other
enterprise, including service with respect to employee benefit plans
(hereinafter an "Indemnitee"), whether the basis of such Proceeding
or Investigation is alleged action in an official capacity or in any
other capacity as set forth above shall be indemnified and held
harmless by the corporation to the fullest extent authorized by the
Florida Business Corporation Act, as the same exists or may
hereafter be amended (but, in the case of any such amendment, only
to the extent that such amendment permits the corporation to provide
broader indemnification rights than such law permitted the
corporation to provide prior to such amendment).
ARTICLE XI
DIRECTOR LIABILITY
To the maximum extent permitted by the Florida Business
Corporation Act as the same exists or may hereafter be amended, no
director of this Corporation shall be liable to the Corporation or
its shareholders for monetary damages arising by reason of actions
or omissions constituting a breach of fiduciary duty as a director.
ARTICLE XII
CORPORATE EXISTENCE
The corporate existence of the Corporation shall commence on
the filing of these Articles of Incorporation by the Department of
State of the State of Florida.
ARTICLE XIII
AFFILIATED TRANSACTIONS
The Corporation expressly elects not to be governed by Section
607.0901 of the Florida Business Corporation Act, as amended from
time to time.
ARTICLE XIV
CONTROL SHARE ACQUISITIONS
The Corporation expressly elects not to be covered by Section
607.0902 of the Florida Business Corporation Act, as amended from
time to time.
IN WITNESS WHEREOF, the undersigned incorporator has executed
these Articles of Incorporation this _____ day of May, 2000.
Glen Akselrod, Incorporator
ACCEPTANCE OF APPOINTMENT
OF
REGISTERED AGENT
The undersigned hereby accepts the appointment as registered
agent of American Uranium Reincorporation, Inc. contained in the
foregoing Articles of Incorporation and states that the undersigned
is familiar with and accepts the obligations set forth in Section
607.0508 of the Florida Business Corporation Act.
E.H.G. RESIDENT AGENTS, INC.
Date: May _______, 2000 By:
Edward H. Gilbert, President
Exhibit E
The Florida Bylaws
BYLAWS
OF
American Uranium, Inc.
a Florida corporation
INDEX
Page
1. Offices . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.1 Principal Office . . . . . . . . . . . . . . . . . . . . 1
1.2 Registered Office. . . . . . . . . . . . . . . . . . . . 1
1.3 Other Offices. . . . . . . . . . . . . . . . . . . . . . 1
2. Meetings of Shareholders. . . . . . . . . . . . . . . . . . . 1
2.1 Annual Meeting . . . . . . . . . . . . . . . . . . . . . 1
2.2 Special Meeting. . . . . . . . . . . . . . . . . . . . . 1
2.3 Shareholders' List for Meeting . . . . . . . . . . . . . 2
2.4 Record Date. . . . . . . . . . . . . . . . . . . . . . . 2
2.5 Notice of Meetings and Adjournment . . . . . . . . . . . 3
2.6 Waiver of Notice . . . . . . . . . . . . . . . . . . . . 3
2.7 Shareholder Proposals. . . . . . . . . . . . . . . . . . 4
3. Shareholder Voting. . . . . . . . . . . . . . . . . . . . . . 4
3.1 Voting Group Defined . . . . . . . . . . . . . . . . . . 4
3.2 Quorum and Voting Requirements for Voting Groups . . . . 4
3.3 Action by Single and Multiple Voting Groups. . . . . . . 5
3.4 Shareholder Quorum and Voting; Greater or Lesser Voting
Requirements . . . . . . . . . . . . . . . . . . . . . . 5
3.5 Voting for Directors; Cumulative Voting. . . . . . . . . 5
3.6 Voting Entitlement of Shares . . . . . . . . . . . . . . 6
3.7 Proxies. . . . . . . . . . . . . . . . . . . . . . . . . 7
3.8 Shares Held by Nominees. . . . . . . . . . . . . . . . . 8
3.9 Corporation's Acceptance of Votes. . . . . . . . . . . . 9
3.10 Action by Shareholders Without Meeting . . . . . . . . . 10
4. Board of Directors and Officers . . . . . . . . . . . . . . . 10
4.1 Qualifications of Directors. . . . . . . . . . . . . . . 10
4.2 Number of Directors. . . . . . . . . . . . . . . . . . . 10
4.3 Terms of Directors Generally . . . . . . . . . . . . . . 10
4.4 Staggered Terms for Directors. . . . . . . . . . . . . . 11
4.5 Vacancy on Board . . . . . . . . . . . . . . . . . . . . 11
4.6 Compensation of Directors. . . . . . . . . . . . . . . . 11
4.7 Meetings . . . . . . . . . . . . . . . . . . . . . . . . 11
4.8 Action by Directors Without a Meeting. . . . . . . . . . 12
4.9 Notice of Meetings . . . . . . . . . . . . . . . . . . . 12
4.10 Waiver of Notice . . . . . . . . . . . . . . . . . . . . 12
4.11 Quorum and Voting. . . . . . . . . . . . . . . . . . . . 12
4.12 Committees . . . . . . . . . . . . . . . . . . . . . . . 12
4.13 Loans to Officers, Directors and Employees; Guaranty of
Obligations. . . . . . . . . . . . . . . . . . . . . . . 13
4.14 Required Officers. . . . . . . . . . . . . . . . . . . . 13
4.15 Duties of Officers . . . . . . . . . . . . . . . . . . . 14
4.16 Resignation and Removal of Officers. . . . . . . . . . . 14
4.17 Contract Rights of Officers. . . . . . . . . . . . . . . 14
4.18 General Standards for Directors. . . . . . . . . . . . . 14
4.19 Director Conflicts of Interest . . . . . . . . . . . . . 15
4.20 Resignation of Directors . . . . . . . . . . . . . . . . 16
5. Indemnification of Directors, Officers, Employees and Agents. 16
5.1 Directors, Officers, Employees and Agents. . . . . . . . 16
6.1 Registered Office and Registered Agent . . . . . . . . . 19
6.2 Change of Registered Office or Registered Agent;
Resignation of Registered Agent. . . . . . . . . . . . . 20
7. Shares, Options, Dividends and Distributions. . . . . . . . . 20
7.1 Authorized Shares. . . . . . . . . . . . . . . . . . . . 20
7.2 Terms of Class or Series Determined by Board of Directors
21
7.3 Issued and Outstanding Shares. . . . . . . . . . . . . . 21
7.4 Issuance of Shares . . . . . . . . . . . . . . . . . . . 22
7.5 Form and Content of Certificates . . . . . . . . . . . . 22
7.6 Shares Without Certificates. . . . . . . . . . . . . . . 23
7.7 Restriction on Transfer of Shares and Other Securities . 23
7.8 Shareholder's Pre-emptive Rights . . . . . . . . . . . . 23
7.9 Corporation's Acquisition of its Own Shares. . . . . . . 24
7.10 Share Options. . . . . . . . . . . . . . . . . . . . . . 24
7.11 Terms and Conditions of Stock Rights and Options . . . . 24
7.12 Share Dividends. . . . . . . . . . . . . . . . . . . . . 25
7.13 Distributions to Shareholders. . . . . . . . . . . . . . 25
8. Amendment of Articles and Bylaws. . . . . . . . . . . . . . . 26
8.1 Authority to Amend the Articles of Incorporation . . . . 26
8.2 Amendment by Board of Directors. . . . . . . . . . . . . 27
8.3 Amendment of Bylaws by Board of Directors. . . . . . . . 27
8.4 Bylaw Increasing Quorum or Voting Requirements for
Directors. . . . . . . . . . . . . . . . . . . . . . . . 27
9. Records and Reports . . . . . . . . . . . . . . . . . . . . . 28
9.1 Corporate Records. . . . . . . . . . . . . . . . . . . . 28
9.2 Financial Statements for Shareholders. . . . . . . . . . 29
9.3 Other Reports to Shareholders. . . . . . . . . . . . . . 29
9.4 Annual Report for Department of State. . . . . . . . . . 29
10. Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . . 30
10.1 Application of Florida Law . . . . . . . . . . . . . . . 30
10.2 Conflicts with Articles of Incorporation . . . . . . . . 30
10.3 Definition of the "Act". . . . . . . . . . . . . . . . . 30
10.4 Fiscal Year. . . . . . . . . . . . . . . . . . . . . . . 30
BYLAWS
1. Offices.
1.1 Principal Office. The principal office of the
corporation in the State of Florida shall be established at such
places as the board of directors from time to time determine.
1.2 Registered Office. The registered office of the
corporation in the State of Florida shall be at the office of its
registered agent as stated in the articles of incorporation or as
the board of directors shall from time to time determine.
1.3 Other Offices. The corporation may have additional
offices at such other places, either within or without the State of
Florida, as the board of directors may from time to time determine
or the business of the corporation may require.
2. Meetings of Shareholders.
2.1 Annual Meeting.
(a) The corporation shall hold a meting of
shareholders annually, for the election of directors and for
the transaction of any proper business, at a time stated in or
fixed in accordance with a resolution of the board of directors.
(b) Annual shareholders' meeting may be held in or
out of the State of Florida at a place stated in or fixed in
accordance with a resolution by the board of directors or, when
not inconsistent with the board of directors' resolution stated
in the notice of the annual meeting. If no place is stated in
or fixed in accordance with these bylaws, or stated in the
notice of the annual meeting, annual meetings shall be held at
the corporation's principal office.
(c) The failure to hold the annual meeting at the
time stated in or fixed in accordance with these bylaws or
pursuant to the Act does not affect the validity of any
corporate action and shall not work a forfeiture of or
dissolution of the corporation.
2.2 Special Meeting.
(a) The corporation shall hold a special meeting
of shareholders:
(1) On call of its board of directors or the
person or persons authorized to do so by the board of
directors; or
(2) If the holders of not less than 10% of
all votes entitled to be cast on any issue proposed to be
considered at the proposed special meeting sign, date and
deliver to the corporation's secretary one or more written
demands for the meeting describing the purpose or purposes for
which it is to be held.
(b) Special shareholders' meetings may be held in
or out of the State of Florida at a place stated in or fixed in
accordance with a resolution of the board of directors, or,
when not inconsistent with the board of directors' resolution,
in the notice of the special meeting. If no place is stated in
or fixed in accordance with these bylaws or in the notice of
the special meeting, special meetings shall be held at the
corporation's principal office.
(c) Only business within the purpose or purposes
described in the special meeting notice may be conducted at a
special shareholders' meeting.
2.3 Shareholders' List for Meeting.
(a) After fixing a record date for a meeting, a
corporation shall prepare a list of the names of all its
shareholders who are entitled to notice of a shareholders'
meeting, in accordance with the Florida Business Corporation
Act (the "Act"), or arranged by voting group, with the address
of, and the number and class and series, if any, of shares held
by, each.
(b) The shareholders' list must be available for
inspection by any shareholder for a period of ten days prior to
the meeting or such shorter time as exists between the record
date and the meeting and continuing through the meeting at the
corporation's principal office, at a place identified in the
meeting notice in the city where the meeting will be held, or
at the office of the corporation's transfer agent or registrar.
A shareholder or his or her agent or attorney is entitled on
written demand to inspect the list (subject to the requirements
of Section 607.1602(3) of the Act), during regular business
hours and at his or her expense, during the period it is
available for inspection.
(c) The corporation shall make the shareholders'
list available at the meeting, and any shareholder or his or
her agent or attorney is entitled to inspect the list at any
time during the meeting or any adjournment.
2.4 Record Date.
(a) The board of directors may set a record for
purposes of determining the shareholders entitled to notice of
and to vote at a shareholders' meeting; however, in no event
may a record date fixed by the board of directors be a date
preceding the date upon which the resolution fixing the record
date is adopted.
(b) Unless otherwise fixed by the board of
directors, the record date for determining shareholders
entitled to demand a special meeting is the date the first
shareholder delivers his or her demand to the corporation. In
the event that the board of directors sets the record date for
a special meeting of shareholders, it shall not be a date
preceding the date upon which the corporation receives the
first demand from a shareholders requesting a special meeting.
(c) If no prior action is required by the board of
directors pursuant to the Act, and, unless otherwise fixed by
the board of directors, the record date for determining
shareholders entitled to take action without a meeting is the
date the first signed written consent is delivered to the
corporation under Section 607.0704 of the Act. If prior action
is required by the board of directors pursuant to the Act, the
record date for determining shareholders entitled to take
action without a meeting is at the close of business on the day
on which the board of directors adopts the resolution taking
such prior action.
(d) Unless otherwise fixed by the board of
directors, the record date for determining the shareholders
entitled to notice of and to vote at an annual or special
shareholders' meeting is the close of business on the day
before the first notice is delivered to shareholders.
(e) A record date may not be more than 70 days
before the meeting or action requiring a determination of
shareholders.
(f) A determination of shareholders entitled to
notice of or to vote at a shareholders' meeting is effective
for any adjournment of the meeting unless the board of
directors fixes a new record date, which it must do if the
meeting is adjourned to a date more than one hundred twenty
(120) days after the date fixed for the original meeting.
2.5 Notice of Meetings and Adjournment.
(a) The corporation shall notify shareholders of
the date, time and place of each annual and special
shareholders's meeting no fewer than ten (10) or more than
sixty (60) days before the meeting date. Unless the Act
requires otherwise, the corporation is required to give notice
only to shareholders entitled to vote at the meeting. Notice
shall be given in the manner provided in Section 607.0141 of
the Act, by or at the direction of the president, the
secretary, or the officer or persons calling the meeting. If
the notice is mailed at least thirty (30) days before the
meeting, it may be done by a class of United States mail other
than first class. Notwithstanding Section 607.0141, if mailed,
such notice shall be deemed to be delivered when deposited in
the United States mail addressed to the shareholder at his or
her address as it appears on the stock transfer books of the
corporation, with postage thereon prepaid.
(b) Unless the Act or the articles of
incorporation requires otherwise, notice of an annual meeting
need not include a description of the purpose or purposes for
which the meeting is called.
(c) Notice of a special meeting must include a
description of the purpose or purposes for which the meeting is
called.
(d) If an annual or special shareholders meeting
is adjourned to a different date, time or place, notice need
not be given of the new date, time or place if the new date,
time or place is announced at the meeting before adjournment is
taken, and any business may be transacted at the adjourned
meeting that might have been transacted on the original date of
the meeting. If a new record date is or must be fixed under
Section 607.0707 of the Act, however, notice of the adjourned
meeting must be given under this section to persons who are
shareholders as of the new record date who are entitled to
notice of the meeting.
(e) Notwithstanding the foregoing, no notice of a
shareholders' meeting need be given if:
(1) an annual report and proxy statements for
two (2) consecutive annual meetings of shareholders, or
(2) all, and at least two checks in payment
of dividends or interest on securities during a twelve (12)
month period, have been sent by first-class United States mail,
addressed to the shareholder at his or her address as it
appears on the share transfer books of the corporation, and
returned undeliverable. The obligation of the corporation to
give notice of a shareholders' meeting to any such shareholder
shall be reinstated once the corporation has received a new
address for such shareholder for entry on its share transfer
books.
2.6 Waiver of Notice.
(a) A shareholder may waive any notice required by
the Act, the articles of incorporation, or bylaws before or
after the date and time stated in the notice. The waiver must
be in writing, be signed by the shareholder entitled to the
notice, and be delivered to the corporation for inclusion in
the minutes or filing with the corporate records. Neither the
business to be transacted at nor the purpose of any regular or
special meeting of the shareholders need be specified in any
written waiver of notice.
(b) A shareholder's attendance at a meeting:
(1) waives objection to lack of notice or
defective notice of the meeting, unless the shareholder at the
beginning of the meeting objects to holding the meeting or
transacting business at the meeting; or
(2) waives objection to consideration of a
particular matter at the meeting that is not within the purpose
or purposes described in the meeting notice, unless the
shareholder objects to considering the matter when it is
presented.
2.7 Shareholder Proposals. Any stockholder proposals
to be considered at any annual or special meeting must be made in
writing and delivered to the corporation not less than 90 days nor
more than 120 days prior to that meeting, but if the corporation
provides less than 30 days notice (actual or by public disclosure)
of the meeting, proposals will be deemed timely if they are received
not more than 10 days following the date of the notice or of the
public disclosure of the meeting. Any proposals must comply with
the requirements of Rule 14a-8 under Regulation 14A of the
Securities Exchange Act of 1934.
3. Shareholder Voting.
3.1 Voting Group Defined. A "voting group" means all
shares of one or more classes or series that under the articles of
incorporation or the Act are entitled to vote and be counted
together collectively on a matter at a meeting of shareholders. All
shares entitled by the articles of incorporation or the Act to vote
generally on the matter are for that purpose a single voting group.
3.2 Quorum and Voting Requirements for Voting Groups.
(a) Shares entitled to vote as a separate voting
group may take action on a matter at a meeting only if a quorum
of those shares exists with respect to that matter. Unless the
articles of incorporation or the Act provides otherwise, a
majority of the votes entitled to be cast on the matter by the
voting group constitutes a quorum of that voting group for
action on that matter.
(b) Once a share is represented for any purpose at
a meeting, it is deemed present for quorum purposes for the
remainder of the meeting and for any adjournment of that
meeting unless a new record date is or must be set for that
adjourned meeting.
(c) If a quorum exists, action on a matter (other
than the election of directors) by a voting group is approved
if the votes cast within the voting group favoring the action
exceed the votes cast opposing the action, unless the articles
of incorporation or the Act requires a greater number of
affirmative votes.
3.3 Action by Single and Multiple Voting Groups.
(a) If the articles of incorporation or the Act
provides for voting by a single voting group on a matter,
action on that matter is taken when voted upon by that voting
group as provided in Section 3.02 of these bylaws.
(b) If the articles of incorporation or the Act
provides for voting by two or more voting groups on a matter,
action on that matter is taken only when voted upon by each of
those voting groups counted separately as provided in Section
3.02 of these bylaws. Action may be taken by one voting group
on a matter even though no action is taken by another voting
group entitled to vote on the matter.
3.4 Shareholder Quorum and Voting; Greater or Lesser
Voting Requirements.
(a) A majority of the shares entitled to vote,
represented in person or by proxy, shall constitute a quorum at
a meeting of shareholders, but in no event shall a quorum
consist of less than one-third (1/3) of the shares entitled to
vote. When a specified item of business is required to be
voted on by a class or series of stock, a majority of the
shares of such class or series shall constitute a quorum for
the transaction of such item of business by that class or series.
(b) An amendment to the articles of incorporation
that adds, changes or deletes a greater or lesser quorum or
voting requirement must meet the same quorum requirement and be
adopted by the same vote and voting groups required to take
action under the quorum and voting requirements then in effect
or proposed to be adopted, whichever is greater.
(c) If a quorum exists, action on a matter, other
than the election of directors, is approved if the votes cast
by the holders of the shares represented at the meeting and
entitled to vote on the subject matter favoring the action
exceed the votes cast opposing the action, unless a greater
number of affirmative votes or voting by classes is required by
the Act or the articles of incorporation.
(d) After a quorum has been established at a
shareholders' meeting, the subsequent withdrawal of
shareholders, so as to reduce the number of shares entitled to
vote at the meeting below the number required for a quorum,
shall not affect the validity of any action taken at the
meeting or any adjournment thereof.
(e) The articles of incorporation may provide for
a greater voting requirement or a greater or lesser quorum
requirement for shareholders (or voting groups of shareholders)
than is provided by the Act, but in no event shall a quorum
consist of less than one-third (1/3) of the shares entitled to
vote.
3.5 Voting for Directors; Cumulative Voting.
(a) Directors are elected by a plurality of the
votes cast by the shares entitled to vote in the election at a
meeting at which a quorum is present.
(b) Each shareholder who is entitled to vote at an
election of directors has the right to vote the number of
shares owned by him for as many persons as there are directors
to be elected and for whose election he or she has a right to
vote. Shareholders do not have a right to cumulate their votes
for directors unless the articles of incorporation so provide.
3.6 Voting Entitlement of Shares.
(a) Unless the articles of incorporation or the
Act provides otherwise, each outstanding share, regardless of
class, is entitled to one vote on each matter submitted to a
vote at a meeting of shareholders. Only shares are entitled to
vote.
(b) The shares of the corporation are not entitled
to vote if they are owned, directly or indirectly, by a second
corporation, domestic or foreign, and the first corporation
owns, directly or indirectly, a majority of shares entitled to
vote for directors of the second corporation.
(c) This section does not limit the power of the
corporation to vote any shares, including its own shares, held
by it in a fiduciary capacity.
(d) Redeemable shares are not entitled to vote on
any matter, and shall not be deemed to be outstanding, after
notice of redemption is mailed to the holders thereof and a sum
sufficient to redeem such shares has been deposited with a
bank, trust company, or other financial institution upon an
irrevocable obligation to pay the holders the redemption price
upon surrender of the shares.
(e) Shares standing in the name of another
corporation, domestic or foreign, may be voted by such officer,
agent, or proxy as the bylaws of the corporate shareholder may
prescribe or, in the absence of any applicable provision, by
such person as the board of directors of the corporate
shareholder may designate. In the absence of any such
designation or in case of conflicting designation by the
corporate shareholder, the chairman of the board, the
president, any vice president, the secretary, and the treasurer
of the corporate shareholder, in that order, shall be presumed
to be fully authorized to vote such shares.
(f) Shares held by an administrator, executor,
guardian, personal representative, or conservator may be voted
by him, either in person or by proxy, without a transfer of
such shares into his or her name. Shares standing in the name
of a trustee may be voted by him, either in person or by proxy,
but no trustee shall be entitled to vote shares held by him
without a transfer of such shares into his or her name or the
name of his or her nominee.
(g) Shares held by or under the control of a
receiver, a trustee in bankruptcy proceedings, or an assignee
for the benefit of creditors may be voted by him without the
transfer thereof into his or her name.
(h) If a share or shares stand of record in the
names of two or more persons, whether fiduciaries, members of a
partnership, joint tenants, tenants in common, tenants by the
entirety, or otherwise, or if two or more persons have the same
fiduciary relationship respecting the same shares, unless the
secretary of the corporation is given notice to the contrary
and is furnished with a copy of the instrument or order
appointing them or creating the relationship wherein it is so
provided, then acts with respect to voting have the following
effect:
(1) If only one votes, in person or in proxy,
his or her act binds all;
(2) If more than one vote, in person or by
proxy, the act of the majority so voting binds all;
(3) If more than one vote, in person or by
proxy, but the vote is evenly split on any particular matter,
each faction is entitled to vote the share or shares in
question proportionally;
(4) If the instrument or order so filed shows
that any such tenancy is held in unequal interest, a majority
or a vote evenly split for purposes of this subsection shall be
a majority or a vote evenly split in interest;
(5) The principles of this subsection shall
apply, insofar as possible, to execution of proxies, waivers,
consents, or objections and for the purpose of ascertaining the
presence of a quorum;
(6) Subject to Section 3.8 of these bylaws,
nothing herein contained shall prevent trustees or other
fiduciaries holding shares registered in the name of a nominee
from causing such shares to be voted by such nominee as the
trustee or other fiduciary may direct. Such nominee may vote
shares as directed by a trustee or their fiduciary without the
necessity of transferring the shares to the name of the trustee
or other fiduciary.
3.7 Proxies.
(a) A shareholder, other person entitled to vote
on behalf of a shareholder pursuant to Section 3.6% of these
bylaws, or attorney in fact may vote the shareholder's shares
in person or by proxy.
(b) A shareholder may appoint a proxy to vote or
otherwise act for him by signing an appointment form, either
personally or by his or her attorney in fact. An executed
telegram or cablegram appearing to have been transmitted by
such person, or a photographic, photostatic, or equivalent
reproduction of an appointment form, is a sufficient
appointment form.
(c) An appointment of a proxy is effective when
received by the secretary or other officer or agent authorized
to tabulate votes. An appointment is valid for up to eleven
(11) months unless a longer period is expressly provided in the
appointment form.
(d) The death or incapacity of the shareholder
appointing a proxy does not affect the right of the corporation
to accept the proxy's authority unless notice of the death or
incapacity is received by the secretary or other officer or
agent authorized to tabulate votes before the proxy exercises
his or her authority under the appointment.
(e) An appointment of a proxy is revocable by the
shareholder unless the appointment form conspicuously states
that it is irrevocable and the appointment is coupled with an
interest. Appointments coupled with an interest include the
appointment of
(1) a pledge;
(2) a person who purchased or agreed to
purchase the shares;
(3) a creditor of the corporation who
extended credit to the corporation under terms requiring the
appointment;
(4) an employee of the corporation whose
employment contract requires the appointment; or
(5) a party to a voting agreement created in
accordance with the Act.
(f) An appointment made irrevocable under this
section becomes revocable when the interest with which it is
coupled is extinguished and, in a case provided for in
Subsection 3.7(e)(3)* or 3.7(e)(4)*, the proxy becomes
revocable three (3) years after the date of the proxy or at the
end of the period, if any, specified herein, whichever is less,
unless the period of irrevocability is renewed from time to
time by the execution of a new irrevocable proxy as provided in
this section. This does not affect the duration of a proxy
under subsection 3.7(c) .
(g) A transferee for value of shares subject to an
irrevocable appointment may revoke the appointment if he or she
did not know if its existence when he or she acquired the
shares and the existence of the irrevocable appointment was not
noted conspicuously on the certificate representing the shares
or on the information statement for shares without certificates.
(h) Subject to section 3.9( of these bylaws and to
any express limitation on the proxy's authority appearing on
the face of the appointment form, a corporation is entitled to
accept the proxy's vote or other action as that of the
shareholder making the appointment.
(i) If an appointment form expressly provides, any
proxy holder may appoint, in writing, a substitute to act in
his or her place.
3.8 Shares Held by Nominees.
(a) The corporation may establish a procedure by
which the beneficial owner of shares that are registered in the
name of a nominee is recognized by the corporation as the
shareholder. The extent of this recognition may be determined
in the procedure.
(b) The procedure may set forth
(1) the types of nominees to which it applies;
(2) the rights or privileges that the
corporation recognizes in a beneficial owner;
(3) the manner in which the procedure is
selected by the nominee;
(4) the information that must be provided
when the procedure is selected;
(5) the period for which selection of the
procedure is effective; and
(6) other aspects of the rights and duties
created.
3.9 Corporation's Acceptance of Votes.
(a) If the name signed on a vote, consent, waiver,
or proxy appointment corresponds to the name of a shareholder,
the corporation if acting in good faith is entitled to accept
the vote, consent waiver, or proxy appointment and give it
effect as the act of the shareholder.
(b) If the name signed on a vote, consent, waiver
or proxy appointment does not correspond to the name of its
shareholder, the corporation if acting in good faith is
nevertheless entitled to accept the vote, consent, waiver, or
proxy appointment and give it effect as the act of the
shareholder if:
(1) the shareholder is an entity and the name
signed purports to be that of an officer or agent of the entity;
(2) the name signed purports to be that of an
administrator, executor, guardian, personal representative, or
conservator representing the shareholder and, if the
corporation requests, evidence of fiduciary status acceptable
to the corporation has been presented with respect to the vote,
consent, waiver, or proxy appointment;
(3) the name signed purports to be that of a
receiver, trustee in bankruptcy, or assignee for the benefit of
creditors of the shareholder and, if the corporation requests,
evidence of this status acceptable to the corporation has been
presented with respect to the vote, consent, waiver, or proxy
appointment;
(4) the name signed purports to be that of a
pledgee, beneficial owner, or attorney in fact of the
shareholder, if the corporation requests, evidence acceptable
to the corporation of the signatory's authority to sign for the
shareholder has been presented with respect to the vote,
consent, waiver, or proxy appointment; or
(5) two (2) or more persons are the
shareholder as covenants or fiduciaries and the name signed
purports to be the name of at lease one (1) of the co-owners
and the person signing appears to be acting on behalf of all
the co-owners.
(c) The corporation is entitled to reject a vote,
consent, waiver, or proxy appointment if the secretary or other
officer or agent authorized to tabulate votes, acting in good
faith, has reasonable basis for doubt about the validity of the
signature on it or about the signatory's authority to sign for
the shareholder.
(d) The corporation and its officer or agent who
accepts or rejects a vote, consent, waiver, or proxy
appointment in good faith and in accordance with the standards
of this section are not liable in damages to the shareholder
for the consequences of the acceptance or rejection.
(e) Corporate action based on the acceptance or
rejection of a vote, consent, waiver, or proxy appointment
under this section is valid unless a court of competent
jurisdiction determines otherwise.
3.10 Action by Shareholders Without Meeting.
(a) Any action required or permitted by the Act to
be taken at any annual or special meeting of shareholders of
the corporation may be taken without a meeting, without prior
notice and without a vote, if the action is taken by the
holders of outstanding stock of each voting group entitled to
vote thereon having not less than the minimum number of votes
with respect to each voting group that would be necessary to
authorize or take such action at a meeting at which all voting
groups and shares entitled to vote thereon were present and
voted. In order to be effective, the action must be evidenced
by one or more written consents describing the action taken,
dated and signed by approving shareholders having the requisite
number of votes of each voting group entitled to vote thereon,
and delivered to the corporation by delivery to its principal
office in this state, its principal place of business, the
corporate secretary, or another office or agent of the
corporation having custody of the book in which proceedings of
meetings of shareholders are recorded. No written consent
shall be effective to take the corporate action referred to
therein unless, within sixty (60) days of the date of the
earliest dated consent is delivered in the manner required by
this section, written consent signed by the number of holders
required to take action is delivered to the corporation by
delivery as set forth in this section.
(b) Within ten (10) days after obtaining such
authorization by written consent, notice in accordance with
Section 607.0704(3) of the Act must be given to those
shareholders who have not consented in writing.
4. Board of Directors and Officers.
4.1 Qualifications of Directors. Directors must be
natural persons who are eighteen (18) years of age or older but need
not be residents of the State of Florida or shareholders of the
corporation.
4.2 Number of Directors.
(1) The board of directors shall consist of
not less than one (1) nor more than seven (7) individuals.
(2) The number of directors may be increased
or decreased from time to time by amendment to these bylaws.
(3) Directors are elected at the first annual
shareholders' meeting and at each annual meeting thereafter
unless their terms are staggered under Section 4.4 of these
bylaws.
4.3 Terms of Directors Generally.
(a) The terms of the initial directors of the
corporation expire at the first shareholders' meeting at which
directors are elected.
(b) The terms of all other directors expire at the
next annual shareholders' meeting following their election
unless their terms are staggered under Section 4.4 of these
bylaws.
(c) A decrease in the number of directors does not
shorten an incumbent director's term.
(d) The term of a director elected to fill a
vacancy expires at the next shareholders' meeting at which
directors are elected.
(e) Despite the expiration of a director's term,
he or she continues to serve until his or her successor is
elected and qualifies or until there is a decrease in the
number of directors.
4.4 Staggered Terms for Directors. The directors of
any corporation organized under the Act may, by the articles of
incorporation, or by amendment to these bylaws adopted by a vote of
the shareholders, be divided into one, two or three classes with the
number of directors in each class being as nearly equal as possible;
the term of office of those of the first class to expire at the
annual meeting next ensuing; of the second class one year
thereafter; at the third class two years thereafter; and at each
annual election held after such classification and election,
directors shall be chosen for a full term, as the case may be, to
succeed those whose terms expire. If the directors have staggered
terms, then any increase or decrease in the number of directors
shall be so apportioned among the classes as to make all classes as
nearly equal in number as possible.
4.5 Vacancy on Board.
(a) Whenever a vacancy occurs on a board of
directors, including a vacancy resulting from an increase in
the number of directors, it may be filled by the affirmative
vote of a majority of the remaining directors.
(b) A vacancy that will occur at a specific later
date (by reason of resignation effective at a later date) may
be filled before the vacancy occurs but the new director may
not take office until the vacancy occurs.
4.6 Compensation of Directors. The board of directors
may fix the compensation of directors.
4.7 Meetings.
(a) The board of directors may hold regular or
special meetings in or out of the State of Florida.
(b) A majority of the directors present, whether
or not a quorum exists, may adjourn any meeting of the board of
directors to another time and place. Notice of any such
adjourned meeting shall be given to the directors who were not
present at the time of the adjournment and, unless the time and
place of the adjourned meeting are announced at the time of the
adjournment, to the other directors.
(c) Meetings of the board of directors may be
called by the chairman of the board or by the president.
(d) The board of directors may permit any or all
directors to participate in a regular or special meeting by, or
conduct the meeting through the use of, any means of
communication by which all directors participating may
simultaneously hear each other during the meeting. A director
participating in a meeting by this means is deemed to be
present in person at the meeting.
4.8 Action by Directors Without a Meeting.
(a) Action required or permitted by the Act to be
taken at a board of directors' meeting or committee meeting may
be taken without a meeting if the action is taken by all
members of the board or of the committee. The action must be
evidenced by one or more written consents describing the action
taken and signed by each director or committee member.
(b) Action taken under this section is effective
when the last director signs the consent, unless the consent
specifies a different effective date.
(c) A consent signed under this section has the
effect of a meeting vote and may be described as such in any
document.
4.9 Notice of Meetings. Regular and special meetings
of the board of directors may be held without notice of the date,
time, place or purpose of the meeting.
4.10 Waiver of Notice. Notice of a meeting of the board
of directors need not be given to any director who signs a waiver of
notice either before or after the meeting. Attendance of a director
at a meeting shall constitute a waiver of notice of such meeting and
a waiver of any and all objections to the place of the meeting, the
time of the meeting, or the manner in which it has been called or
convened, except when a director states, at the beginning of the
meeting or promptly upon arrival at the meeting, any objection to
the transaction of business because the meeting is not lawfully
called or convened.
4.11 Quorum and Voting.
(a) A quorum of a board of directors consists of a
majority of the number of directors prescribed by the articles
of incorporation or these bylaws.
(b) If a quorum is present when a vote is taken,
the affirmative vote of a majority of directors present is the
act of the board of directors.
(c) A director of a corporation who is present at
a meeting of the board of directors or a committee of the board
of directors when corporate action is taken is deemed to have
assented to the action taken unless:
(1) He objects at the beginning of the
meeting (or promptly upon his or her arrival) to holding it or
transacting specified business at the meeting; or
(2) He votes against or abstains from the
action taken.
4.12 Committees.
(a) The board of directors, by resolution adopted
by a majority of the full board of directors, may designate
from among its members an executive committee and one or more
other committees each of which, to the extent provided in such
resolution, shall have and may exercise all the authority of
the board of directors, except that no such committee shall
have the authority to:
(1) Approve or recommend to shareholders
actions or proposals required by the Act to be approved by
shareholders.
(2) Fill vacancies on the board of directors
or any committee thereof.
(3) Adopt, amend or repeal these bylaws.
(4) Authorize or approve the reacquisition of
shared unless pursuant to a general formula or method specified
by the board of directors.
(5) Authorize or approve the issuance or sale
or contract for the sale of shares, or determine the
designation and relative rights, preferences, and limitations
of a voting group except that the board of directors may
authorize a committee (or a senior executive officer of the
corporation) to do so within limits specifically prescribed by
the board of directors.
(b) The sections of these bylaws which govern
meetings, notice and waiver of notice, and quorum and voting
requirements of the board of directors apply to committees and
their members as well.
(c) Each committee must have two or more members
who serve at the pleasure of the board of directors. The
board, by resolution adopted in accordance herewith, may
designate one or more directors as alternate members of any
such committee who may act in the place and stead of any absent
member or members at any meeting of such committee.
(d) Neither the designation of any such committee,
the delegation thereto of authority, nor action by such
committee pursuant to such authority shall alone constitute
compliance by any member of the board of directors not a member
of the committee in question with his or her responsibility to
act in good faith, in a manner he or she reasonably believes to
be in the best interests of the corporation, and with such care
as an ordinarily prudent person in a like position would use
under similar circumstances.
4.13 Loans to Officers, Directors and Employees;
Guaranty of Obligations. The Company may lend money to, guaranty
any obligation of, or otherwise assist any officer, director, or
employee of the corporation or of a subsidiary, whenever, in the
judgment of the board of directors, such loan, guaranty, or other
assistance may be with or without interest and may be unsecured or
secured in such a manner as the board of directors shall approve,
including, without limitation, a pledge of shares of stock of the
corporation. Nothing in this section shall be deemed to deny,
limit, or restrict the powers of guaranty or warranty of any
corporation at common law or under any statute. Loans, guaranties,
or other types of assistance are subject to section 4.19(.
4.14 Required Officers.
(a) The corporation shall have such officers as
the board of directors may appoint from time to time.
(b) A duly appointed officer may appoint one or
more assistant officers.
(c) The board of directors shall delegate to one
of the officers responsibility for preparing minutes of the
directors' and shareholders' meetings and for authenticating
records of the corporation.
(d) The same individual may simultaneously hold
more than one office in the corporation.
4.15 Duties of Officers. Each officer has the authority
and shall perform the duties set forth in a resolution or
resolutions of the board of directors or by direction of any officer
authorized by the board of directors to prescribe the duties of
other officers.
4.16 Resignation and Removal of Officers.
(a) An officer may resign at any time by
delivering notice to the corporation. A resignation is
effective when the notice is delivered unless the notice
specifies a later effective date. If a resignation is made
effective at a later date and the corporation accepts the
future effective date, the board of directors may fill the
vacancy before the effective date if the board of directors
provides that the successor does not take office until the
effective date.
(b) The board of directors may remove any officer
at any time with or without cause. Any assistant officer, if
appointed by another officer, may likewise be removed by the
board of directors or by the officer which appointed him in
accordance with these bylaws.
4.17 Contract Rights of Officers. The appointment of an
officer does not itself create contract rights.
4.18 General Standards for Directors.
(a) A director shall discharge his or her duties
as a director, including his or her duties as a member of a
committee:
(1) in good faith;
(2) with the care an ordinarily prudent
person in a like position would exercise under similar
circumstances; and
(3) in a manner he or she reasonably believes
to be in the best interests of the corporation.
(b) In discharging his or her duties, a director
is entitled to rely on information, opinions, reports or
statements, including financial statements and other financial
data, if prepared or presented by:
(1) One or more officers or employees of the
corporation whom the director reasonably believes to be
reliable and competent in the matters presented;
(2) Legal counsel, public accountants, or
other persons as to matters the director reasonably believes
are within the persons' professional or expert competence; or
(3) A committee of the board of directors of
which he or she is not a member if the director reasonably
believes the committee merits confidence.
(c) In discharging his or her duties, a director
may consider such factors as the director deems relevant,
including the long-term prospects and interests of the
corporation and its shareholders, and the social, economic,
legal, or other effects of any action on the employees,
suppliers, customers of the corporation or its subsidiaries,
the communities and society in which the corporation or its
subsidiaries operate, and the economy of the state and the nation.
(d) A director is not acting in good faith if he
or she has knowledge concerning the matter in question that
makes reliance otherwise permitted by subsection 4.18(b)
unwarranted.
(e) A director is not liable for any action taken
as a director, or any failure to take any action, if he or she
performed the duties of his or her office in compliance with
this section.
4.19 Director Conflicts of Interest. No contract or
other transaction between a corporation and one or more interested
directors shall be either void or voidable because of such
relationship or interest, because such director or directors are
present at the meeting of the board of directors or a committee
thereof which authorizes, approves or ratifies such contract or
transaction, or because his or their votes are counted for such
purpose, if:
(a) The fact of such relationship or interest is
disclosed or known to the board of directors or committee which
authorizes, approves or ratifies the contract or transactions
by a vote or consent sufficient for the purpose without
counting the votes or consents of such interested directors;
(b) The fact of such relationship or interest is
disclosed or known to the shareholders entitled to vote and
they authorize, approve or ratify such contract or transaction
by vote or written consent; or
(c) The contract or transaction is fair and
reasonable as to the corporation at the time it is authorized
by the board, a committee or the shareholders.
Common or interested directors may be counted in
determining the presence of a quorum at the meeting of the board of
directors or a committee thereof which authorizes, approves or
ratifies such contract or transaction.
For the purpose of Paragraph 4.19(b)& above, a conflict of
interest transaction is authorized, approved or ratified if it
receives the vote of a majority of the shares entitled to be counted
under this subsection. Shares owned by or voted under the control
of a director who has a relationship or interest in the conflict of
interest transaction may not be counted in a vote of shareholders to
determine whether to authorize, approve or ratify a conflict of
interest transaction under paragraph 4.19(b)&. The vote of those
shares, however, is counted in determining whether the transaction
is approved under other sections of the Act. A majority of the
shares, whether or not present, that are entitled to be counted in a
vote on the transaction under this subsection constitutes a quorum
for the purpose of taking action under this section.
4.20 Resignation of Directors.
(a) A director may resign at any time by
delivering written notice to the board of directors or its
chairman or to the corporation.
(b) A resignation is effective when the notice is
delivered unless the notice specifies a later effective date.
If a resignation is made effective at a later date, the board
of directors may fill the pending vacancy before the effective
date if the board of directors provides that the successor does
not take office until the effective date.
5. Indemnification of Directors, Officers, Employees and
Agents.
5.1 Directors, Officers, Employees and Agents.
(a) The corporation shall have power to indemnify
any person who was or is a party to any proceeding (other than
an action by, or in the right of, the corporation), by reason
of the fact that he or she is or was a director, officer,
employee, or agent of the corporation or is or was serving at
the request of the corporation as a director, officer,
employee, or agent of another corporation, partnership, joint
venture, trust, or other enterprise against liability incurred
in connection with such proceeding, including any appeal
thereof, if he or she acted in good faith and in a manner he or
she reasonably believed to be in, or not apposed to, the best
interests of the corporation, and, with respect to any criminal
action or proceeding, had no reasonable cause to believe his or
her conduct was unlawful. The termination of any proceeding by
judgment, order, settlement, or conviction or upon a plea of
nolo contendere or its equivalent shall not, of itself, create
a presumption that the person did not act in good faith and in
a manner which he or she reasonably believed to be in, or not
opposed to, the best interests of the corporation or, with
respect to any criminal action or proceeding, had reasonable
cause to believe that his conduct was unlawful.
(b) The corporation shall have power to indemnify
any person, who was or is a party to any proceeding by or in
the right of the corporation to procure a judgment in its favor
by reason of the fact that he or she is or was a director,
officer, employee, or agent of the corporation or is or was
serving at the request of the corporation as a director,
officer, employee, or agent of another corporation,
partnership, joint venture, trust, or other enterprise, against
expenses and amounts paid in settlement not exceeding, in the
judgment of the board of directors, the estimated expense of
litigating the proceeding to conclusion, actually and
reasonably incurred in connection with the defense or
settlement of such proceeding, including any appeal thereof.
Such indemnification shall be authorized if such person acted
in good faith and in a manner he reasonably believed to be in,
or not opposed to, the best interests of the corporation,
except that no indemnification shall be made under this
subsection in respect of any claim, issue, or matter as to
which such person shall have been adjudged to be liable unless,
and only to the extent that, the court in which such proceeding
was brought, or any other court of competent jurisdiction,
shall determine upon application that, despite the adjudication
of liability but in view of all circumstances of the case, such
person is fairly and reasonably entitled to indemnity for such
expenses which such court shall deem proper.
(c) To the extent that a director, officer,
employee, or agent of the corporation has been successful on
the merits or otherwise in defense of any proceeding referred
to in subsections 5.1(a), 5.1(b)0 or 5.1(a), 5.1(b)0, or in
defense of any claim, issue, or matter therein, he shall be
indemnified against expenses actually and reasonably incurred
by him in connection therewith.
(d) Any indemnification under subsections
5.1(a),5.1(b)0 or 5.1(a), 5.1(b)0, unless pursuant to a
determination by a court, shall be made by the corporation only
as authorized in the specific case upon a determination that
indemnification of the director, officer, employee or agent is
proper in the circumstances because he or she has met the
applicable standard of conduct set forth in subsections 5.1(a),
5.1(b)0 or 5.1(a), 5.1(b)0. Such determination shall be made:
(1) By the board of directors by a majority
vote of a quorum consisting of directors who were not parties
to such proceeding;
(2) If such a quorum is not obtainable or,
even if obtainable, by majority vote of a committee duly
designated by the board of directors (in which directors who
are parties may participate) consisting solely of two or more
directors not at the time parties to the proceeding;
(3) By independent legal counsel:
(A) Selected by the board of directors
prescribed in paragraph 5.1(d)(1)! or the committee
prescribed in paragraph 5.1(d)(2)$; or
(B) If a quorum of the directors cannot
be obtained for paragraph 5.1(d)(1)! and the committee
cannot be designed under paragraph 5.1(d)(2)$, selected by
a majority vote of the full board of directors (in which
directors who are parties may participate); or
(4) By the shareholders by a majority vote of
a quorum consisting of shareholders who were not parties to
such proceeding or, if no such quorum is obtainable, by a
majority vote of shareholders who were not parties to such
proceeding.
(e) Evaluation of the reasonableness of expenses
and authorization of indemnification shall be made in the same
manner as the determination that indemnification is
permissible. However, if the determination of permissibility
is made by independent legal counsel, persons specified by
paragraph 5.1(d)(3)( shall evaluate the reasonableness of
expenses and may authorize indemnification.
(f) Expenses incurred by an officer or director in
defending a civil or criminal proceeding may be paid by the
corporation in advance of the final disposition of such
proceeding upon receipt of an undertaking by or on behalf of
such director or officer to repay such amount if he is
ultimately found not to be entitled to indemnification by the
corporation pursuant to this section. Expenses incurred by
other employees and agents may be paid in advance upon such
terms or conditions that the board of directors deems appropriate.
(g) The indemnification and advancement of
expenses provided pursuant to this section are not exclusive,
and the corporation may make any other or further
indemnification or advancement of expenses of any of its
directors, officers, employees, or agents, under any bylaw,
agreement, vote of shareholders or disinterested directors, or
otherwise, both as to action in his or her official capacity
and as to action in another capacity while holding such office.
However, indemnification or advancement of expenses shall not
be made to or on behalf of any director, officer, employee, or
agent if a judgment or other final adjudication establishes
that his or her actions, or omissions to act, were material to
the cause of action so adjudicated and constitute:
(1) A violation of the criminal law, unless
the director, officer, employee, or agent had reasonable cause
to believe his or her conduct was lawful or had no reasonable
cause to believe his or her conduct was unlawful;
(2) A transaction from which the director,
officer, employee, or agent derived an improper personal benefit;
(3) In the case of a director, a circumstance
under which the liability provisions of Section 607.0834 under
the Act are applicable; or
(4) Willful misconduct or a conscious
disregard for the best interests of the corporation in a
proceeding by or in the right of the corporation to procure a
judgment in its favor or in a proceeding by or in the right of
a shareholder.
(h) Indemnification and advancement of expenses as
provided in this section shall continue as, unless otherwise
provided when authorized or ratified, to a person who has
ceased to be a director, officer, employee, or agent and shall
inure to the benefit of the heirs, executors, and
administrators of such a person, unless otherwise provided when
authorized or ratified.
(i) Notwithstanding the failure of the corporation
to provide indemnification, and despite any contrary
determination of the board or of the shareholders in the
specific case, a director, officer, employee, or agent of the
corporation who is or was a party to a proceeding may apply for
indemnification or advancement of expenses, or both, to the
court conducting the proceeding, to the circuit court, or to
another court of competent jurisdiction. On receipt of an
application, the court, after giving any notice that it
considers necessary, may order indemnification and advancement
of expenses, including expenses incurred in seeking
court-ordered indemnification or advancement of expenses, if it
determines that:
(1) The director, officer, employee, or agent
if entitled to mandatory indemnification under subsection
5.1(c)", in which case the court shall also order the
corporation to pay the director reasonable expenses incurred in
obtaining court-ordered indemnification or advancement of
expenses;
(2) The director, officer, employee or agent
is entitled to indemnification or advancement of expenses, or
both, by virtue of the exercise by the corporation of its power
pursuant to subsection 5.1(g)+; or
(3) The director, officer, employee, or agent
is fairly and reasonably entitled to indemnification or
advancement of expenses, or both, in view of all the relevant
circumstances, regardless of whether such person met the
standard of conduct set forth in subsection 5.1(a), 5.1(b)0,
5.1(a), 5.1(b)0 or 5.1(g)+.
(j) For purposes of this section, the term
"corporation: includes, in addition to the resulting
corporation, any constituent corporation (including any
constituent of a constituent) absorbed in a consolidation or
merger, so that any person who is or was a director, officer,
employee, or agent of a constituent corporation, or is or was
serving at the request of a constituent corporation as a
director, officer, employee, or agent of another corporation,
partnership, joint venture, trust or other enterprise, is in
the same position under this section with respect to the
resulting or surviving corporation as he or she would have with
respect to such constituent corporation if its separate
existence had continued.
(k) For purposes of this section:
(1) The term "other enterprises" includes
employee benefits plans;
(2) The term "expenses" includes counsel
fees, including those for appeal;
(3) The term "liability" includes obligations
to pay a judgment, settlement, penalty, fine (including an
excise tax assessed with respect to any employee benefit plan),
and expenses actually and reasonably incurred with respect to a
proceeding;
(4) The term "proceeding" includes any
threatened, pending, or completed action, suit or other type of
proceeding, whether civil, criminal, administrative, or
investigative and whether formal or informal;
(5) The term "agent" includes a volunteer;
(6) The term "serving at the request of the
corporation" includes any service as a director, officer,
employee, or agent of the corporation that imposes duties on
such persons, including duties relating to an employee benefit
plan and its participants or beneficiaries; and
(7) The term "not opposed to the best
interest of the corporation" describes the actions of a person
who acts in good faith and in a manner he or she reasonably
believes to be in the best interests of the participants and
beneficiaries of an employee benefit plan.
(l) The corporation shall have power to purchase
and maintain insurance on behalf of any person who is or was a
director, officer, employee, or agent of the corporation or is
or was serving at the request of the corporation as a director,
officer, employee, or agent of another corporation,
partnership, joint venture, trust, or other enterprise against
any liability asserted against him or her and incurred by him
or her in any such capacity or arising out of his or her status
as such, whether or not the corporation would have the power to
indemnify him against such liability under the provisions of
this section.
6. Office and Agent.
6.1 Registered Office and Registered Agent.
(a) The corporation shall have and continuously
maintain in the State of Florida:
(1) A registered office which may be the same
as its place of business;
(2) A registered agent, who, may be either:
(A) An individual who resides in the
State of Florida whose business office is identical with
such registered office; or
(B) Another corporation or
not-for-profit corporation as defined in Chapter 617 of
the Act, authorized to transact business or conduct its
affairs in the State of Florida, having a business office
identical with the registered office.
6.2 Change of Registered Office or Registered Agent;
Resignation of Registered Agent.
(a) The corporation may change its registered
office or its registered agent upon filing with the Department
of State of the State of Florida a statement of change setting
forth:
(1) The name of the corporation;
(2) The street address of its current
registered office;
(3) If the current registered office is to be
changes, the street address of the new registered office;
(4) The name of its current registered agent;
(5) If its current registered agent is to be
changes, the name of the new registered agent and the new
agent's written consent (either on the statement or attached to
it) to the appointment;
(6) That the street address of its registered
office and the street address of the business office of its
registered agent, as changed, will be identical;
(7) That such change was authorized by
resolution duly adopted by its board of directors or by an
officer of the corporation so authorized by the board of
directors.
7. Shares, Options, Dividends and Distributions.
7.1 Authorized Shares.
(a) The articles of incorporation prescribe the
classes of shares and the number of shares of each class that
the corporation is authorized to issue, as well as a
distinguishing designation for each class, and prior to the
issuance of shares of a class the preferences, limitations, and
relative rights of that class must be described in the articles
of incorporation.
(b) The articles of incorporation must authorize:
(1) One or more classes of shares that
together have unlimited voting rights, and
(2) One or more classes of shares (which may
be the same class or classes as those with voting rights) that
together are entitled to receive the net assets of the
corporation upon dissolution.
(c) The articles of incorporation may authorize
one or more classes of shares that have special, conditional,
or limited voting rights, or no rights, or no right to vote,
except to the extent prohibited by the Act;
(1) Are redeemable or convertible as
specified in the articles of incorporation;
(2) Entitle the holders to distributions
calculated in any manner, including dividends that may be
cumulative, non-cumulative, or partially cumulative;
(3) Have preference over any class of shares
with respect to distributions, including dividends and
distributions upon the dissolution of the corporation.
(d) Shares which are entitled to preference in the
distribution of dividends or assets shall not be designated as
common shares. Shares which are not entitled to preference in
the distribution of dividends or assets shall be common shares
and shall not be designated as preferred shares.
7.2 Terms of Class or Series Determined by Board of
Directors.
(a) If the articles of incorporation so provide,
the board of directors may determine, in whole or in part, the
preferences, limitations, and relative rights (within the
limits set forth in Section 7.1 of:
(1) Any class of shares before the issuance
of any shares of that class, or
(2) One or more series within a class before
the issuance of any shares of that series.
(b) Each series of a class must be given a
distinguishing designation.
(c) All shares of a series must have preferences,
limitations, and relative rights identical with those of other
shares of the same series and, except to the extent otherwise
provided in the description of the series, of those of other
series of the same class.
(d) Before issuing any shares of a class or series
created under this section, the corporation must deliver to the
Department of State of the State of Florida for filing articles
of amendment, which are effective without shareholder action,
in accordance with Section 607.0602 of the Act.
7.3 Issued and Outstanding Shares.
(a) A corporation may issue the number of shares
of each class or series authorized by the articles of
incorporation. Shares that are issued are outstanding shares
until they are reacquired, redeemed, converted, or cancelled.
(b) The reacquisition, redemption, or conversion
of outstanding shares is subject to the limitations of
subsection 7.3(c) and to Section 607.06401 of the act.
(c) At all times that shares of the corporation
are outstanding, one or more shares that together have
unlimited voting rights and one or more shares that together
are entitled to receive the net assets of the corporation upon
dissolution must be outstanding.
7.4 Issuance of Shares.
(a) The board of directors may authorize shares to
be issued for consideration consisting of any tangible property
or benefit to the corporation, including cash, promissory
notes, services performed, promises to perform services
evidenced by a written contract, or other securities of the
corporation.
(b) Before the corporation issues shares, the
board of directors must determine that the consideration
received or to be received for shares to be issued is adequate.
That determination by the board of directors is conclusive
insofar as the adequacy of consideration for the issuance of
shares relates to whether the shares are validly issued, fully
paid, and non-assessable. When it cannot be determined that
outstanding shares are fully paid and non-assessable, there
shall be a conclusive presumption that such shares are fully
paid and non-assessable if the board of directors makes a good
faith determination that there is no substantial evidence that
the full consideration for such shares has not been paid.
(c) When the corporation receives the
consideration for which the board of directors authorized the
issuance of shares, the shares issued therefor are fully paid
and non-assessable. Consideration in the form of a promise to
pay money or a promise to perform services is received by the
corporation at the time of the making of the promise, unless
the agreement specifically provides otherwise.
(d) The corporation may place in escrow shares
issued for a contract for future services or benefits or a
promissory note, or make other arrangements to restrict the
transfer of the shares, and may credit distributions in respect
of the shares against their purchase price, until the services
are performed, the note is paid, or the benefits received. If
the services are not performed, the shares escrowed or
restricted and the distributions credited may be cancelled in
whole or in part.
7.5 Form and Content of Certificates.
(a) Shares may but need not be represented by
certificates. Unless the Act or another statute expressly
provides otherwise, the rights and obligations of shareholders
are identical whether or not their shares are represented by
certificates.
(b) At a minimum, each share certificate must
state on its face:
(1) The name of the issuing corporation and
that the corporation is organized under the laws of the State
of Florida;
(2) The name of the person to whom issued; and
(3) The number and class of shares and the
designation of the series, if any, the certificate represents.
(c) If the shares being issued are of different
classes of shares or different series within a class, the
designations, relative rights, preferences, and limitations
applicable to each class and the variations in rights,
preferences, and limitations determined for each series (and
the authority of the board of directors to determine variations
for future series) must be summarized on the front or back of
each certificate. Alternatively, each certificate may state
conspicuously on its front or back that the corporation will
furnish the shareholder a full statement of this information on
request and without charge.
(d) Each share certificate:
(1) Must be signed (either manually or in
facsimile) by an officer or officers designated by the board of
directors, and
(2) May bear the corporate seal or its
facsimile.
(e) If the person who signed (either manually or
in facsimile) a share certificate no longer holds office when
the certificate is issued, the certificate is nevertheless valid.
(f) Nothing in this section may be construed to
invalidate any share certificate validly issued and outstanding
under the Act on July 1, 1990.
7.6 Shares Without Certificates.
(a) The board of directors of the corporation may
authorize the issue of some or all of the shares of any or all
of its classes or series without certificates. The
authorization does not affect shares already represented by
certificates until they are surrendered to the corporation.
(b) Within a reasonable time after the issue or
transfer of shares without certificates, the corporation shall
send the shareholder a written statement of the information
required on certificates by the Act.
7.7 Restriction on Transfer of Shares and Other
Securities.
(a) The articles of incorporation, these bylaws,
an agreement among shareholders, or an agreement between
shareholders and the corporation may impose restrictions on the
transfer or registration of transfer of shares of the
corporation. A restriction does not affect shares issued
before the restriction was adopted unless the holders of such
shares are parties to the restriction agreement or voted in
favor of the restriction.
(b) A restriction on the transfer or registration
of transfer is valid and enforceable against the holder or a
transferee of the holder if the restriction is authorized by
this section, and effected in compliance with the provisions of
the Act, including having a proper purpose as referred to in
the Act.
7.8 Shareholder's Pre-emptive Rights. The shareholders
of the corporation do not have a pre-emptive right to acquire the
corporation's unissued shares.
7.9 Corporation's Acquisition of its Own Shares.
(a) The corporation may acquire its own shares,
and, unless otherwise provided in the articles of incorporation
or except as provided in subsection 7.9(d)%, shares so acquired
constitute authorized but unissued shares of the same class but
undesignated as to series.
(b) If the articles of incorporation prohibit the
reissue of acquired shares, the number of authorized shares is
reduced by the number of shares acquired, effective upon
amendment of the articles of incorporation.
(c) Articles of amendment may be adopted by the
board of directors without shareholder action, shall be
delivered to the Department of State of the State of Florida
for filing, and shall set forth the information required by
Section 607.0631 of the Act.
(d) Shares of the corporation in existence on June
30, 1990, which are treasury shares under Section 607.004(18),
Florida Statutes (1987), shall be issued, but not outstanding,
until cancelled or disposed of by the corporation.
7.10 Share Options.
(a) Unless the articles of incorporation provide
otherwise, the corporation may issue rights, options, or
warrants for the purchase of shares of the corporation. The
board of directors shall determine the terms upon which the
rights, options, or warrants are issued, their form and
content, and the consideration for which the shares are to be
issued.
(b) The terms and conditions of stock rights and
options which are created and issued by the corporation, or its
successor, and which entitle the holders thereof to purchase
from the corporation shares of any class of classes, whether
authorized by unissued shares, treasury shares, or shares to be
purchased or acquired by the corporation, may include, without
limitation, restrictions, or conditions that preclude or limit
the exercise, transfer, receipt, or holding of such rights or
options by any person or persons, including any person or
persons owning or offering to acquire a specified number or
percentage of the outstanding common shares or other securities
of the corporation, or any transferee or transferees of any
such person or persons, or that invalidate or void such rights
or options held by any such person or persons or any such
transferee or transferees.
7.11 Terms and Conditions of Stock Rights and Options.
The terms and conditions of the stock rights and options which are
created and issued by the corporation [or its successors], and which
entitle the holders thereof to purchase from the corporation shares
of any class or classes, whether authorized but unissued shares,
treasury shares, or shares to be purchased or acquired by the
corporation, may include, without limitation, restrictions or
conditions that preclude or limit the exercise, transfer, receipt or
holding of such rights or options by any person or persons,
including any person or persons owning or offering to acquire a
specified number or percentage of the outstanding common shares or
other securities of the corporation, or any transferee or
transferees of any such person or persons, or that invalidate or
void such rights or options held by any such person or persons or
any such transferee or transferees.
7.12 Share Dividends.
(a) Shares may be issued pro rata and without
consideration to the corporation's shareholders or to the
shareholders of one or more or series. An issuance of shares
under this subsection is a share dividend.
(b) Shares of one class or series may not be
issued as a share dividend in respect of shares of another
class or series unless:
(1) The articles of incorporation so authorize;
(2) A majority of the votes entitled to be
case by the class or series to be issued approves the issue; or
(3) There are no outstanding shares of the
class or series to be issued.
(c) If the board of directors does not fix the
record date for determining shareholders entitled to a share
dividend, it is the date the board of directors authorizes the
share dividend.
7.13 Distributions to Shareholders.
(a) The board of directors may authorize and the
corporation may make distributions to its shareholders subject
to restriction by the articles of incorporation and the
limitations in subsection 7.13(c).
(b) If the board of directors does not fix the
record date for determining shareholders entitled to a
distribution (other than one involving a purchase, redemption,
or other acquisition of the corporation's shares), it is the
date the board of directors authorizes the distribution.
(c) No distribution may be made if, after giving
it effect:
(1) The corporation would not be able to pay
its debts as they become due in the usual course of business; or
(2) The corporation's total assets would be
less than the sum of its total liabilities plus (unless the
articles of incorporation permit otherwise) the amount that
would be needed, if the corporation were to be dissolved at the
time of the distribution, to satisfy the preferential rights
upon dissolution of shareholders whose preferential rights are
superior to those receiving the distribution.
(d) The board of directors may base a
determination that a distribution is not prohibited under
subsection 7.13(c) either on financial statements prepared on
the basis of accounting practices and principles that are
reasonable in the circumstances or on a fair valuation or other
method that is reasonable in the circumstances. In the case of
any distribution based upon such a valuation, each such
distribution shall be identified as a distribution based upon a
current valuation of assets, and the amount per share paid on
the basis of such valuation shall be disclosed to the
shareholders concurrent with their receipt of the distribution.
(e) Except as provided in subsection 7.13(g),, the
effect of a distribution under subsection 7.13(c) is measured:
(1) In the case of distribution by purchase,
redemption, or other acquisition of the corporation's shares,
as of the earlier of:
(A) The date money or other property is
transferred or debt incurred by the corporation; or
(B) The date the shareholder ceases to
be a shareholder with respect to the acquired shares;
(2) In the case of any other distribution of
indebtedness, as of the date the indebtedness is distributed;
(3) In all other cases, as of:
(A) The date the distribution is
authorized if the payment occurs within one hundred twenty
(120) days after the date of authorization; or
(B) The date the payment is made if it
occurs more than one hundred twenty (120) days after the
date of authorization.
(f) A corporation's indebtedness to a shareholder
incurred by reason of a distribution made in accordance with
this section is at parity with the corporation's indebtedness
to its general, unsecured creditors except to the extent
subordinated by agreement.
(g) Indebtedness of the corporation, including
indebtedness issued as a distribution, is not considered a
liability for purposes of determinations under subsection
7.13(c) if its terms provide that payment of principal and
interest are made only if and to the extent that payment of a
distribution to shareholders could then be made under this
section. If the indebtedness is issued as a distribution, each
payment of principal or interest is treated as a distribution,
the effect of which is measured on the date the payment is
actually made.
8. Amendment of Articles and Bylaws.
8.1 Authority to Amend the Articles of Incorporation.
(a) The corporation may amend its articles of
incorporation at any time to add or change a provision that is
required or permitted in the articles of incorporation or to
delete a provision not required in the articles of
incorporation. Whether a provision is required or permitted in
the articles of incorporation is determined as of the effective
date of the amendment.
(b) A shareholder of the corporation does not have
a vested property right resulting from any provision in the
articles of incorporation, including provisions relating to
management, control, capital structure, dividend entitlement,
or purpose or duration of the corporation.
8.2 Amendment by Board of Directors. The corporation's
board of directors may adopt one or more amendments to the
corporation's articles of incorporation without shareholder action:
(a) To extend the duration of the corporation if
it was incorporated at a time when limited duration was
required by law;
(b) To delete names and addresses of initial
directors;
(c) To delete the name and address of the initial
registered agent or registered office, if a statement of change
is on file with the Department of State of the State of Florida;
(d) To delete any other information contained in
the articles of incorporation that is solely of historical
interest;
(e) To change each issued and unissued authorized
share of an outstanding class into a greater number of whole
shares if the corporation has only shares of that class
outstanding;
(f) To delete the authorization for a class or
series of shares authorized pursuant to Section 607.0602 of the
Act, if no shares of such class or series have been issued;
(g) To change the corporate name by substituting
the word "corporation," "incorporated," or "company," or the
abbreviation "corp.," "Inc.," or "Co.," for a similar word or
abbreviation in the name, or by adding, deleting, or changing a
geographical attribution for the name; or
(h) To make any other change expressly permitted
by the Act to be made without shareholder action.
8.3 Amendment of Bylaws by Board of Directors. The
corporation's board of directors may amend or repeal the
corporation's bylaws unless the Act reserves the power to amend a
particular bylaw provision exclusively to the shareholders.
8.4 Bylaw Increasing Quorum or Voting Requirements for
Directors.
(a) A bylaw that fixes a greater quorum or voting
requirement for the board of directors may be amended or repealed:
(1) If originally adopted by the
shareholders, only by the shareholders;
(2) If originally adopted by the board of
directors, either by the shareholders or by the board of
directors.
(b) A bylaw adopted or amended by the shareholders
that fixes a greater quorum or voting requirement for the board
of directors may provide that it may be amended or repealed
only by a specific vote of either the shareholders or the board
of directors.
(c) Action by the board of directors under
paragraph 8.4(a)(2)! to adopt or amend a bylaw that changes the
quorum or voting requirement for the board of directors must
meet the same quorum requirement and be adopted by the same
vote required to take action under the quorum and voting
requirement then in effect or proposed to be adopted, whichever
is greater.
9. Records and Reports.
9.1 Corporate Records.
(a) The corporation shall keep as permanent
records minutes of all meetings of its shareholders and board
of directors, a record of all actions taken by the shareholders
or board of directors without a meeting, and a record of all
actions taken by a committee of the board of directors in place
of the board of directors on behalf of the corporation.
(b) The corporation shall maintain accurate
accounting records.
(c) The corporation or its agent shall maintain a
record of its shareholders in a form that permits preparation
of a list of the names and addresses of all shareholders in
alphabetical order by class of shares showing the number and
series of shares held by each.
(d) The corporation shall maintain its records in
written form or in another form capable of conversion into
written form within a reasonable time.
(e) The corporation shall keep a copy of the
following records:
(1) Its articles or restated articles of
incorporation and all amendments to them currently in effect;
(2) Its bylaws or restated bylaws and all
amendments to them currently in effect;
(3) Resolutions adopted by the board of
directors creating one or more classes or series of shares and
finding their relative rights, preferences, and limitations, if
shares issued pursuant to those resolutions are outstanding;
(4) The minutes of all shareholders' meetings
and records of all action taken by shareholders without a
meeting for the past three (3) years;
(5) Written communications to all
shareholders generally or all shareholders of a class or series
within the past three (3) years, including the financial
statements furnished for the past three (3) years;
(6) A list of the names and business street
addresses of its current directors and officers; and
(7) Its most recent annual report delivered
to the Department of State of the State of Florida.
9.2 Financial Statements for Shareholders
(a) Unless modified by resolution of the
shareholders within one hundred twenty (120) days of the close
of each fiscal year, the corporation shall furnish its
shareholders annual financial statements which may be
consolidated or combined statements of the corporation and one
or more of its subsidiaries, as appropriate, that include a
balance sheet as of the end of the fiscal year, an income
statement for that year, and a statement of cash flows for that
year. If financial statements are prepared for the corporation
on the basis of generally-accepted accounting principles, the
annual financial statements must also be prepared on that basis.
(b) If the annual financial statements are
reported upon by a public accountant, his report must accompany
them. If not, the statements must be accompanied by a
statement of the president or the person responsible for the
corporation's accounting records:
(1) Stating his reasonable belief whether the
statements were prepared on the basis of generally-accepted
accounting principles and, if not, describing the basis of
preparation; and
(2) Describing any respects in which the
statements were not prepared on a basis of accounting
consistent with the statements prepared for the preceding year.
(c) The corporation shall mail the annual
financial statements to each shareholder within one hundred
twenty (120) days after the close of each fiscal year or within
such additional time thereafter as is reasonably necessary to
enable the corporation to prepare its financial statements, if
for reasons beyond the corporation's control, it is unable to
prepare its financial statements within the prescribed period.
Thereafter, on written request from a shareholder who was not
mailed the statements, the corporation shall mail him the
latest annual financial statements.
9.3 Other Reports to Shareholders.
(a) If the corporation indemnifies or advances
expenses to any director, officer, employee or agent otherwise
than by court order or action by the shareholders or by an
insurance carrier pursuant to insurance maintained by the
corporation, the corporation shall report the indemnification
or advance in writing to the shareholders with or before the
notice of the next shareholders' meeting, or prior to such
meeting if the indemnification or advance occurs after the
giving of such notice but prior to the time such meeting is
held, which report shall include a statement specifying the
persons paid, the amounts paid, and the nature and status at
the time of such payment of the litigation or threatened
litigation.
(b) If the corporation issues or authorizes the
issuance of shares for promises to render services in the
future, the corporation shall report in writing to the
shareholders the number of shares authorized or issued, and the
consideration received by the corporation, with or before the
notice of the next shareholders' meeting.
9.4 Annual Report for Department of State.
(a) The corporation shall deliver to the
Department of State of the State of Florida for filing a sworn
annual report on such forms as the Department of State of the
State of Florida prescribes that sets forth the information
prescribed by Section 607.1622 of the Act.
(b) Proof to the satisfaction of the Department of
Sate of the State of Florida on or before July 1 of each
calendar year that such report was deposited in the United
States mail in a sealed envelope, properly addressed with
postage prepaid, shall be deemed in compliance with this
requirement.
(c) Each report shall be executed by the
corporation by an officer or director of, if the corporation is
in the hands of a receiver or trustee, shall be executed on
behalf of the corporation by such receiver or trustee, and the
signing thereof shall have the same legal effect as if made
under oath, without the necessity of appending such oath thereto.
(d) Information in the annual report must be
current as of the date the annual report is executed on behalf
of the corporation.
(e) Any corporation failing to file an annual
report which complies with the requirements of this section
shall not be permitted to maintain or defend any action in any
court of this state until such report is filed and all fees and
taxes due under the Act are paid and shall be subject to
dissolution or cancellation of its certificate of authority to
do business as provided in the Act.
10. Miscellaneous.
10.1 Application of Florida Law. Whenever any provision
of these bylaws is inconsistent with any provision of the Florida
Business Corporation Act, Statutes 607, as they may be amended from
time to time, then in such instance Florida law shall prevail.
10.2 Conflicts with Articles of Incorporation. In the
event that any provision contained in these bylaws conflicts with
any provision of the corporation's articles of incorporation, as
amended from time to time, the provisions of the articles of
incorporation shall prevail and be given full force and effect, to
the full extent permissible under the Act.
10.3 Definition of the "Act". All references contained
herein to the "Act" or to sections of the "Act" shall be deemed to
be in reference to the Florida Business Corporation Act.
10.4 Fiscal Year. The fiscal year of the corporation
shall be determined by resolution of the board of directors.
Exhibit F
Section 14A; Chapter 11 of the New Jersey Act
CHAPTER 11. RIGHTS OF DISSENTING SHAREHOLDERS
14A:11-1. RIGHT OF SHAREHOLDERS TO DISSENT.
(1) Any shareholder of a domestic corporation shall have the
right to dissent from any of the following corporate actions
(a) Any plan of merger or consolidation to which the
corporation is a party, provided that, unless the certificate of
incorporation otherwise provides
(i) a shareholder shall not have the right to dissent from any
plan of merger or consolidation with respect to shares
(A) of a class or series which is listed on a national
securities exchange or is held of record by not less than 1,000
holders on the record date fixed to determine the shareholders
entitled to vote upon the plan of merger or consolidation; or
(B) for which, pursuant to the plan of merger or consolidation,
he will receive (x) cash, (y) shares, obligations or other
securities which, upon consummation of the merger or consolidation,
will either be listed on a national securities exchange or held of
record by not less than 1,000 holders, or (z) cash and such securities;
(ii) a shareholder of a surviving corporation shall not have
the right to dissent from a plan of merger, if the merger did not
require for its approval the vote of such shareholders as provided
in section 14A:10- 5.1 or in subsection 14A:10-3(4), 14A:10-7(2) or
14A:10-7(4); or
(b) Any sale, lease, exchange or other disposition of all or
substantially all of the assets of a corporation not in the usual or
regular course of business as conducted by such corporation, other
than a transfer pursuant to subsection (4) of N.J.S.14A:10-11,
provided that, unless the certificate of incorporation otherwise
provides, the shareholder shall not have the right to dissent
(i) with respect to shares of a class or series which, at the
record date fixed to determine the shareholders entitled to vote
upon such transaction, is listed on a national securities exchange
or is held of record by not less than 1,000 holders; or
(ii) from a transaction pursuant to a plan of dissolution of
the corporation which provides for distribution of substantially all
of its net assets to shareholders in accordance with their
respective interests within one year after the date of such
transaction, where such transaction is wholly for
(A) cash; or
(B) shares, obligations or other securities which, upon
consummation of the plan of dissolution will either be listed on a
national securities exchange or held of record by not less than
1,000 holders; or
(C) cash and such securities; or
(iii) from a sale pursuant to an order of a court having
jurisdiction.
(2) Any shareholder of a domestic corporation shall have the
right to dissent with respect to any shares owned by him which are
to be acquired pursuant to section 14A:10-9.
(3) A shareholder may not dissent as to less than all of the
shares owned beneficially by him and with respect to which a right
of dissent exists. A nominee or fiduciary may not dissent on behalf
of any beneficial owner as to less than all of the shares of such
owner with respect to which the right of dissent exists.
(4) A corporation may provide in its certificate of
incorporation that holders of all its shares, or of a particular
class or series thereof, shall have the right to dissent from
specified corporate actions in addition to those enumerated in
subsection 14A:11-1(1), in which case the exercise of such right of
dissent shall be governed by the provisions of this Chapter.
14A:11-2. NOTICE OF DISSENT; DEMAND FOR PAYMENT; ENDORSEMENT OF
CERTIFICATES
(1) Whenever a vote is to be taken, either at a meeting of
shareholders or upon written consents in lieu of a meeting pursuant
to section 14A:5-6, upon a proposed corporate action from which a
shareholder may dissent under section 14A:11-1, any shareholder
electing to dissent from such action shall file with the corporation
before the taking of the vote of the shareholders on such corporate
action, or within the time specified in paragraph 14A:5-6(2)(b) or
14A:5-6(2)(c), as the case may be, if no meeting of shareholders is
to be held, a written notice of such dissent stating that he intends
to demand payment for his shares if the action is taken.
(2) Within 10 days after the date on which such corporate
action takes effect, the corporation, or, in the case of a merger or
consolidation, the surviving or new corporation, shall give written
notice of the effective date of such corporate action, by certified
mail to each shareholder who filed written notice of dissent
pursuant to subsection 14A:11-2(1), except any who voted for or
consented in writing to the proposed action.
(3) Within 20 days after the mailing of such notice, any
shareholder to whom the corporation was required to give such notice
and who has filed a written notice of dissent pursuant to this
section may make written demand on the corporation, or, in the case
of a merger or consolidation, on the surviving or new corporation,
for the payment of the fair value of his shares.
(4) Whenever a corporation is to be merged pursuant to section
14A:10-5.1 or subsection 14A:10-7 (4) and shareholder approval is
not required under subsections 14A:10-5.1(5) and 14A:10-5.1(6), a
shareholder who has the right to dissent pursuant to section
14A:11-1 may, not later than 20 days after a copy or summary of the
plan of such merger and the statement required by subsection
14A:10-5.1(2) is mailed to such shareholder, make written demand on
the corporation or on the surviving corporation, for the payment of
the fair value of his shares.
(5) Whenever all the shares, or all the shares of a class or
series, are to be acquired by another corporation pursuant to
section 14A:10-9, a shareholder of the corporation whose shares are
to be acquired may, not later than 20 days after the mailing of
notice by the acquiring corporation pursuant to paragraph
14A:10-9(3)(b), make written demand on the acquiring corporation for
the payment of the fair value of his shares.
(6) Not later than 20 days after demanding payment for his
shares pursuant to this section, the shareholder shall submit the
certificate or certificates representing his shares to the
corporation upon which such demand has been made for notation
thereon that such demand has been made, whereupon such certificate
or certificates shall be returned to him. If shares represented by a
certificate on which notation has been made shall be transferred,
each new certificate issued therefor shall bear similar notation,
together with the name of the original dissenting holder of such
shares, and a transferee of such shares shall acquire by such
transfer no rights in the corporation other than those which the
original dissenting shareholder had after making a demand for
payment of the fair value thereof.
(7) Every notice or other communication required to be given or
made by a corporation to any shareholder pursuant to this Chapter
shall inform such shareholder of all dates prior to which action
must be taken by such shareholder in order to perfect his rights as
a dissenting shareholder under this Chapter.
14A:11-3. "DISSENTING SHAREHOLDER" DEFINED; DATE FOR DETERMINATION
OF FAIR VALUE
(1) A shareholder who has made demand for the payment of his
shares in the manner prescribed by subsection 14A:11-2(3),
14A:11-2(4) or 14A:11-2(5) is hereafter in this Chapter referred to
as a "dissenting shareholder."
(2) Upon making such demand, the dissenting shareholder shall
cease to have any of the rights of a shareholder except the right to
be paid the fair value of his shares and any other rights of a
dissenting shareholder under this Chapter.
(3) "Fair value" as used in this Chapter shall be determined
(a) As of the day prior to the day of the meeting of
shareholders at which the proposed action was approved or as of the
day prior to the day specified by the corporation for the tabulation
of consents to such action if no meeting of shareholders was held; or
(b) In the case of a merger pursuant to section 14A:10-5.1 or
subsection 14A:10-7(4) in which shareholder approval is not
required, as of the day prior to the day on which the board of
directors approved the plan of merger; or
(c) In the case of an acquisition of all the shares or all the
shares of a class or series by another corporation pursuant to
section 14A:10-9, as of the day prior to the day on which the board
of directors of the acquiring corporation authorized the
acquisition, or, if a shareholder vote was taken pursuant to section
14A:10-12, as of the day provided in paragraph 14A:11-3(3)(a). In
all cases, "fair value" shall exclude any appreciation or
depreciation resulting from the proposed action.
14A:11-4. TERMINATION OF RIGHT OF SHAREHOLDER TO BE PAID THE FAIR
VALUE OF HIS SHARES
(1) The right of a dissenting shareholder to be paid the fair
value of his shares under this Chapter shall cease if
(a) he has failed to present his certificates for notation as
provided by subsection 14A:11-2(6), unless a court having
jurisdiction, for good and sufficient cause shown, shall otherwise
direct;
(b) his demand for payment is withdrawn with the written
consent of the corporation;
(c) the fair value of the shares is not agreed upon as provided
in this Chapter and no action for the determination of fair value by
the Superior Court is commenced within the time provided in this
Chapter;
(d) the Superior Court determines that the shareholder is not
entitled to payment for his shares;
(e) the proposed corporate action is abandoned or rescinded; or
(f) a court having jurisdiction permanently enjoins or sets
aside the corporate action.
(2) In any case provided for in subsection 14A:11-4(1), the
rights of the dissenting shareholder as a shareholder shall be
reinstated as of the date of the making of a demand for payment
pursuant to subsections 14A:11-2(3), 14A:11-2(4) or 14A:11-2(5)
without prejudice to any corporate action which has taken place
during the interim period. In such event, he shall be entitled to
any intervening preemptive rights and the right to payment of any
intervening dividend or other distribution, or, if any such rights
have expired or any such dividend or distribution other than in cash
has been completed, in lieu thereof, at the election of the board,
the fair value thereof in cash as of the time of such expiration or
completion.
14A:11-5. RIGHTS OF DISSENTING SHAREHOLDER
(1) A dissenting shareholder may not withdraw his demand for
payment of the fair value of his shares without the written consent
of the corporation.
(2) The enforcement by a dissenting shareholder of his right to
receive payment for his shares shall exclude the enforcement by such
dissenting shareholder of any other right to which he might
otherwise be entitled by virtue of share ownership, except as
provided in subsection 14A:11-4(2) and except that this subsection
shall not exclude the right of such dissenting shareholder to bring
or maintain an appropriate action to obtain relief on the ground
that such corporate action will be or is ultra vires, unlawful or
fraudulent as to such dissenting shareholder.
14A:11-6. DETERMINATION OF FAIR VALUE BY AGREEMENT
(1) Not later than 10 days after the expiration of the period
within which shareholders may make written demand to be paid the
fair value of their shares, the corporation upon which such demand
has been made pursuant to subsections 14A:11-2(3), 14A:11-2(4) or
14A:11-2(5) shall mail to each dissenting shareholder the balance
sheet and the surplus statement of the corporation whose shares he
holds, as of the latest available date which shall not be earlier
than 12 months prior to the making of such offer and a profit and
loss statement or statements for not less than a 12-month period
ended on the date of such balance sheet or, if the corporation was
not in existence for such 12-month period, for the portion thereof
during which it was in existence. The corporation may accompany
such mailing with a written offer to pay each dissenting shareholder
for his shares at a specified price deemed by such corporation to be
the fair value thereof. Such offer shall be made at the same price
per share to all dissenting shareholders of the same class, or, if
divided into series, of the same series.
(2) If, not later than 30 days after the expiration of the
10-day period limited by subsection 14A:11-6(1), the fair value of
the shares is agreed upon between any dissenting shareholder and the
corporation, payment therefor shall be made upon surrender of the
certificate or certificates representing such shares.
14A:11-7. PROCEDURE ON FAILURE TO AGREE UPON FAIR VALUE;
COMMENCEMENT OF ACTION TO DETERMINE FAIR VALUE
(1) If the fair value of the shares is not agreed upon within
the 30-day period limited by subsection 14A:11-6(2), the dissenting
shareholder may serve upon the corporation upon which such demand
has been made pursuant to subsections 14A:11-2(3), 14A:11-2(4) or
14A:11-2(5) a written demand that it commence an action in the
Superior Court for the determination of the fair value of the
shares. Such demand shall be served not later than 30 days after the
expiration of the 30-day period so limited and such action shall be
commenced by the corporation not later than 30 days after receipt by
the corporation of such demand, but nothing herein shall prevent the
corporation from commencing such action at any earlier time.
(2) If a corporation fails to commence the action as provided
in subsection 14A:11-7(1), a dissenting shareholder may do so in the
name of the corporation, not later than 60 days after the expiration
of the time limited by subsection 14A:11-7(1) in which the
corporation may commence such an action.
14A:11-8. ACTION TO DETERMINE FAIR VALUE; JURISDICTION OF COURT;
APPOINTMENT OF APPRAISER
In any action to determine the fair value of shares pursuant to
this Chapter:
(a) The Superior Court shall have jurisdiction and may proceed
in the action in a summary manner or otherwise;
(b) All dissenting shareholders, wherever residing, except
those who have agreed with the corporation upon the price to be paid
for their shares, shall be made parties thereto as an action against
their shares quasi in rem;
(c) The court in its discretion may appoint an appraiser to
receive evidence and report to the court on the question of fair
value, who shall have such power and authority as shall be specified
in the order of his appointment; and
(d) The court shall render judgment against the corporation and
in favor of each shareholder who is a party to the action for the
amount of the fair value of his shares.
14A:11-9. JUDGMENT IN ACTION TO DETERMINE FAIR VALUE
(1) A judgment for the payment of the fair value of shares
shall be payable upon surrender to the corporation of the
certificate or certificates representing such shares.
(2) The judgment shall include an allowance for interest at
such rate as the court finds to be equitable, from the date of the
dissenting shareholder's demand for payment under subsections
14A:11-2(3), 14A:11-2(4) or 14A:11-2(5) to the day of payment. If
the court finds that the refusal of any dissenting shareholder to
accept any offer of payment, made by the corporation under section
14A:11-6, was arbitrary, vexatious or otherwise not in good faith,
no interest shall be allowed to him.
14A:11-10. COSTS AND EXPENSES OF ACTION
The costs and expenses of bringing an action pursuant to
section 14A:11-8 shall be determined by the court and shall be
apportioned and assessed as the court may find equitable upon the
parties or any of them. Such expenses shall include reasonable
compensation for and reasonable expenses of the appraiser, if any,
but shall exclude the fees and expenses of counsel for and experts
employed by any party; but if the court finds that the offer of
payment made by the corporation under section 14A:11-6 was not made
in good faith, or if no such offer was made, the court in its
discretion may award to any dissenting shareholder who is a party to
the action reasonable fees and expenses of his counsel and of any
experts employed by the dissenting shareholder.
14A:11-11. DISPOSITION OF SHARES ACQUIRED BY CORPORATION
(1) The shares of a dissenting shareholder in a transaction
described in subsection 14A:11-1(1) shall become reacquired by the
corporation which issued them or by the surviving corporation, as
the case may be, upon the payment of the fair value of shares.
(2) (Deleted by amendment, P.L.1995, c.279.)
(3) In an acquisition of shares pursuant to section 14A:10-9 or
section 14A:10-13, the shares of a dissenting shareholder shall
become the property of the acquiring corporation upon the payment by
the acquiring corporation of the fair value of such shares. Such
payment may be made, with the consent of the acquiring corporation,
by the corporation which issued the shares, in which case the shares
so paid for shall become reacquired by the corporation which issued
them and shall be cancelled.
