U.S. SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549
_____________________________
FORM 10-SB
_____________________________
GENERAL FORM FOR REGISTRATION OF SECURITIES OF
SMALL BUSINESS ISSUERS
Under Section 12(g) of
The Securities Exchange Act of 1934
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N. T. PROPERTIES ,INC.
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(Name of Small Business Issuer in its charter)
Nevada 33-0838073
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
6 Venture
Suite 207
Irvine, California 92618
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(Address of principal executive offices) (Zip code)
Issuer's telephone number: (949) 435-9262
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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
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(Title of Class)
Page One of Seventy-Five Pages.
Exhibit Index is Located at Page Thirty Five.
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TABLE OF CONTENTS
Page
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PART I
Item 1. Description of Business . . . . . . . . . . . . . 3
Item 2. Plan of Operation. . . . . . . . . . . . . . . . . 8
Item 3. Description of Property. . . . . . . . . . . . . . 15
Item 4. Security Ownership of Certain
Beneficial Owners and Management . . . . . . . . . 15
Item 5. Directors, Executive Officers, Promoters
and Control Persons. . . . . . . . . . . . . . . 16
Item 6. Executive Compensation . . . . . . . . . . . . . . 19
Item 7. Certain Relationships and
Related Transactions. . . . . . . . . . . . . . 20
Item 8. Description of Securities. . . . . . . . . . . . . 20
PART II
Item 1. Market for Common Equities and Related Stockholder
Matters . . . . . . . . . . . . . .. . . . . . . 22
Item 2. Legal Proceedings. . . . . . . . . . . . . . . . . 24
Item 3. Changes in and Disagreements with Accountants. . . 24
Item 4. Recent Sales of Unregistered Securities. . . . . . 24
Item 5. Indemnification of Directors and Officers. . . . . 25
PART F/S
Financial Statements . . . . . . . . . . . . . . . 26
PART III
Item 1. Index to Exhibits. . . . . . . . . . . . . . . . . 35
Item 2. Description of Exhibits. . . . . . . . . . . . . . 37
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PART I
Item 1. Description of Business
N. T. Properties, Inc.(the "Company"), was incorporated on
September 21, 1982 under the laws of the State of Nevada, to
engage in any lawful corporate undertaking, including, but not
limited to, selected mergers and acquisitions. The Company has
been in the developmental stage since inception and has
undertaken no business operations to date. Other than issuing
shares to its original shareholders, the Company has never
commenced any operational activities. As such, the Company can
be defined as a "shell" company, whose sole purpose at this time
is to locate and consummate a merger or acquisition with a
private entity. The Board of Directors of the Company has
elected to commence implementation of the Company's principal
business purpose, described below under "Item 2 - Plan of
Operation."
The Company is filing this registration statement on a
voluntary basis because the primary attraction of the Company as
a merger partner or acquisition vehicle will be its status as a
public company. Any business combination or transaction will
likely result in a significant issuance of shares and substantial
dilution to present stockholders of the Company.
The Company has been in the developmental stage since
inception and has had no operations to date.
The proposed business activities described herein classify
the Company as a "blank check" company. Many states have enacted
statutes, rules and regulations limiting the sale of securities
of "blank check" companies in their respective jurisdictions.
Management does not intend to undertake any efforts to cause a
market to develop in the Company's securities or undertake any
offering of the Company's securities, either debt or equity,
until such time as the Company has successfully implemented its
business plan described herein. Relevant thereto, each
shareholder of the Company has executed and delivered a "lock-up"
letter agreement, affirming that they shall not sell their
respective shares of the Company's common stock until such time
as the Company has successfully consummated a merger or
acquisition and the Company is no longer classified as a "blank
check" company. In order to provide further assurances that no
trading will occur in the Company's securities until a merger or
acquisition has been consummated, each shareholder has agreed to
place their respective stock certificate with the Company's legal
counsel, Bryan A. Gianesin, who will not release these respective
certificates until such time as legal counsel has confirmed that
a merger or acquisition has been successfully consummated. Bryan
A. Gianesin is also a shareholder of the Company. However,
while management believes that the procedures established to
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preclude any sale of the Company's securities prior to closing of
a merger or acquisition will be sufficient, there can be no
assurances that the procedures established relevant herein will
unequivocally limit any shareholder's ability to sell their
respective securities before such closing.
Forward Looking Statements
The Company cautions readers regarding certain forward
looking statements in the following discussion and elsewhere in
this registration statement or any other statement made by, or on
the behalf of the Company, whether or not in future filings with
the Securities and Exchange Commission. Forward looking
statements are statements not based on historical information and
which relate to future operations, strategies, financial results
or other developments. Forward looking statements are
necessarily based upon estimates and assumptions that are
inherently subject to significant business, economic and
competitive uncertainties and contingencies, many of which are
beyond the Company's control and many of which, with respect to
future business decisions, are subject to change. These
uncertainties and contingencies can affect actual results and
could cause actual results to differ materially from those
expressed in any forward looking statements made by, or on behalf
of, the Company. The Company disclaims any obligation to update
forward looking statements.
The Company's business is subject to numerous risk factors,
including the following:
No Operating History or Revenue and Minimal Assets. The
Company has had no operating history nor any revenues or earnings
from operations. The Company has no significant assets or
financial resources. The Company will, in all likelihood,
sustain operating expenses without corresponding revenues, at
least until the consummation of a business combination. This may
result in the Company incurring a net operating loss which will
increase continuously until the Company can consummate a business
combination with a profitable business opportunity. There is no
assurance that the Company can identify such a business
opportunity and consummate such a business combination.
Speculative Nature of Company's Proposed Operations. The
success of the Company's proposed plan of operation will depend
to a great extent on the operations, financial condition and
management of the identified business opportunity. While
management intends to seek business combination(s) with entities
having established operating histories, there can be no assurance
that the Company will be successful in locating candidates
meeting such criteria. In the event the Company completes a
business combination, of which there can be no assurance, the
success of the Company's operations may be dependent upon
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management of the successor firm or venture partner firm and
numerous other factors beyond the Company's control.
Scarcity of and Competition for Business Opportunities and
Combinations. The Company is and will continue to be an
insignificant participant in the business of seeking mergers
with, joint ventures with and acquisitions of small private and
public entities. A large number of established and
well-financed entities, including venture capital firms, are
active in mergers and acquisitions of companies which may be
desirable target candidates for the Company. Nearly all such
entities have significantly greater financial resources,
technical expertise and managerial capabilities than the Company
and, consequently, the Company will be at a competitive
disadvantage in identifying possible business opportunities and
successfully completing a business combination. Moreover, the
Company will also compete in seeking merger or acquisition
candidates with numerous other small public companies.
No Agreement for Business Combination or Other Transaction-
No Standards for Business Combination. The Company has no
arrangement, agreement or understanding with respect to engaging
in a merger with, joint venture with or acquisition of, a private
or public entity. There can be no assurance the Company will be
successful in identifying and evaluating suitable business
opportunities or in concluding a business combination.
Management has not identified any particular industry or specific
business within an industry for evaluation by the Company. There
is no assurance the Company will be able to negotiate a business
combination on terms favorable to the Company. The Company has
not established a specific length of operating history or a
specified level of earnings, assets, net worth or other criteria
which it will require a target business opportunity to have
achieved, and without which the Company would not consider a
business combination in any form with such business opportunity.
Accordingly, the Company may enter into a business combination
with a business opportunity having no significant operating
history, losses, limited or no potential for earnings, limited
assets, negative net worth or other negative characteristics.
Continued Management Control, Limited Time Availability.
While seeking a business combination, management anticipates
devoting up to twenty hours per month to the business of the
Company. None of the Company's officers has entered into a
written employment agreement with the Company and none is
expected to do so in the foreseeable future. The Company has not
obtained key man life insurance on any of its officers or
directors. Notwithstanding the combined limited experience and
time commitment of management, loss of the services of any of
these individuals would adversely affect development of the
Company's business and its likelihood of continuing operations.
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See "Item 5 - Directors, Executive Officers, Promoters and
Control Persons."
Conflicts of Interest - General. Officers and directors of
the Company may in the future participate in business ventures
which could be deemed to compete directly with the Company.
Additional conflicts of interest and non-arms length transactions
may also arise in the future in the event the Company's officers
or directors are involved in the management of any firm with
which the Company transacts business. Management has adopted a
policy that the Company will not seek a merger with, or
acquisition of, any entity in which management serve as officers,
directors or partners, or in which they or their family members
own or hold any ownership interest.
Reporting Requirements May Delay or Preclude Acquisition.
Sections 13 and 15(d) of the Securities Exchange Act of 1934 (the
"Exchange Act"), require companies subject thereto to provide
certain information about significant acquisitions, including
certified financial statements for the company acquired, covering
one, two, or three years, depending on the relative size of the
acquisition. The time and additional costs that may be incurred
by some target entities to prepare such statements may
significantly delay or essentially preclude consummation of an
otherwise desirable acquisition by the Company. Acquisition
prospects that do not have or are unable to obtain the required
audited statements may not be appropriate for acquisition so long
as the reporting requirements of the 1934 Act are applicable.
Lack of Market Research or Marketing Organization. The
Company has neither conducted, nor have others made available to
it, results of market research indicating that market demand
exists for the transactions contemplated by the Company.
Moreover, the Company does not have, and does not plan to
establish, a marketing organization. Even in the event demand is
identified for a merger or acquisition contemplated by the
Company, there is no assurance the Company will be successful in
completing any such business combination.
Lack of Diversification. The Company's proposed operations,
even if successful, will in all likelihood result in the Company
engaging in a business combination with a business opportunity.
Consequently, the Company's activities may be limited to those
engaged in by business opportunities which the Company merges
with or acquires. The Company's inability to diversify its
activities into a number of areas may subject the Company to
economic fluctuations within a particular business or industry
and therefore increase the risks associated with the Company's
operations.
Regulation. Although the Company will be subject to
regulation under the Securities Exchange Act of 1934, management
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believes the Company will not be subject to regulation under the
Investment Company Act of 1940, insofar as the Company will not
be engaged in the business of investing or trading in securities.
In the event the Company engages in business combinations which
result in the Company holding passive investment interests in a
number of entities, the Company could be subject to regulation
under the Investment Company Act of 1940. In such event, the
Company would be required to register as an investment company
and could be expected to incur significant registration and
compliance costs. The Company has obtained no formal
determination from the Securities and Exchange Commission as to
the status of the Company under the Investment Company Act of
1940 and, consequently, any violation of such Act would subject
the Company to material adverse consequences.
Probable Change in Control and Management. A business
combination involving the issuance of the Company's Common Shares
will, in all likelihood, result in shareholders of a private
company obtaining a controlling interest in the Company. Any
such business combination may require management of the Company
to sell or transfer all or a portion of the Company's Common
Shares held by them, or resign as members of the Board of
Directors of the Company. The resulting change in control of the
Company could result in removal of one or more present officers
and directors of the Company and a corresponding reduction in or
elimination of their participation in the future affairs of the
Company.
Reduction of Percentage Share Ownership Following Business
Combination. The Company's primary plan of operation is based
upon a business combination with a private concern which, in all
likelihood, would result in the Company issuing securities to
shareholders of any such private company. The issuance of
previously authorized and unissued Common Shares of the Company
would result in reduction in percentage of shares owned by
present and prospective shareholders of the Company and may
result in a change in control or management of the Company.
Disadvantages of Blank Check Offering. The Company may
enter into a business combination with an entity that desires to
establish a public trading market for its shares. A business
opportunity may attempt to avoid what it deems to be adverse
consequences of undertaking its own public offering by seeking a
business combination with the Company. Such consequences may
include, but are not limited to, time delays of the registration
process, significant expenses to be incurred in such an offering,
loss of voting control to public shareholders and the inability
or unwillingness to comply with various federal and state laws
enacted for the protection of investors.
Taxation. Federal and state tax consequences will, in all
likelihood, be major considerations in any business combination
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the Company may undertake. Currently, such transactions may be
structured so as to result in tax-free treatment to both
companies, pursuant to various federal and state tax provisions.
The Company intends to structure any business combination so as
to minimize the federal and state tax consequences to both the
Company and the target entity; however, there can be no
assurance that such business combination will meet the statutory
requirements of a tax-free reorganization or that the parties
will obtain the intended tax-free treatment upon a transfer of
stock or assets. A non-qualifying reorganization could result in
the imposition of both federal and state taxes which may have an
adverse effect on both parties to the transaction.
Requirement of Audited Financial Statements May Disqualify
Business Opportunities. Management of the Company believes that
any potential business opportunity must provide audited financial
statements for review, for the protection of all parties to the
business combination. One or more attractive business
opportunities may choose to forego the possibility of a business
combination with the Company, rather than incur the expenses
associated with preparing audited financial statements.
Item 2. Plan of Operation
The Company intends to seek to acquire assets or shares of
an entity actively engaged in business which generates revenues,
in exchange for its securities. The Company has no particular
acquisitions in mind and has not entered into any negotiations
regarding such an acquisition. None of the Company's officers,
directors, promoters or affiliates have engaged in any
preliminary contact or discussions with any representative of any
other company regarding the possibility of an acquisition or
merger between the Company and such other company as of the date
of this Registration Statement.
The Company has no full time employees. The Company's
President and Secretary have agreed to allocate a portion of
their time to the activities of the Company, without
compensation. These officers anticipate that the business plan
of the Company can be implemented by their devoting minimal time
per month to the business affairs of the Company and,
consequently, conflicts of interest may arise with respect to the
limited time commitment by such officers. See "Item 5 -
Directors, Executive Officers, Promoters and Control Persons -
Resumes."
The Company's officers and directors may, in the future,
become involved with other companies who have a business purpose
similar to that of the Company. As a result, additional
potential conflicts of interest may arise in the future. If such
a conflict does arise and an officer or director of the Company
is presented with business opportunities under circumstances
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where there may be a doubt as to whether the opportunity should
belong to the Company or another "blank check" company they are
affiliated with, they will disclose the opportunity to all such
companies. If a situation arises in which more than one company
desires to merge with or acquire that target company and the
principals of the proposed target company has no preference as to
which company will merger or acquire such target company, the
company which first filed a registration statement with the
Securities and Exchange Commission will be entitled to proceed
with the proposed transaction.
The Bylaws of the Company provide that the Company shall
possess and may indemnify officers and/or directors of the
Company for liabilities, which can include liabilities arising
under the securities laws. Therefore, assets of the Company
could be used or attached to satisfy any liabilities subject to
such indemnification. See "Part II - Item 5 - Indemnification of
Directors and Officers."
General Business Plan
The Company's purpose is to seek, investigate and, if such
investigation warrants, acquire an interest in business
opportunities presented to it by persons or firms who or which
desire to seek the perceived advantages of an Exchange Act
registered corporation. The Company will not restrict its search
to any specific business, industry, or geographical location and
the Company may participate in a business venture of virtually
any kind or nature. This discussion of the proposed business is
purposefully general and is not meant to be restrictive of the
Company's virtually unlimited discretion to search for and enter
into potential business opportunities. Management anticipates
that it may be able to participate in only one potential business
venture because the Company has nominal assets and limited
financial resources. See "Part F/S - "Financial Statements."
This lack of diversification should be considered a substantial
risk to shareholders of the Company because it will not permit
the Company to offset potential losses from one venture against
gains from another.
The Company may seek a business opportunity with entities
which have recently commenced operations, or which wish to
utilize the public marketplace in order to raise additional
capital in order to expand into new products or markets, to
develop a new product or service, or for other corporate
purposes. The Company may acquire assets and establish wholly
owned subsidiaries in various businesses or acquire existing
businesses as subsidiaries.
The Company anticipates that the selection of a business
opportunity in which to participate will be complex and extremely
risky. Due to general economic conditions, rapid technological
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advances being made in some industries and shortages of available
capital, management believes that there are numerous firms
seeking the perceived benefits of a publicly registered
corporation. Such perceived benefits may include facilitating or
improving the terms on which additional equity financing may be
sought, providing liquidity for incentive stock options or
similar benefits to key employees, providing liquidity (subject
to restrictions of applicable statutes), for all shareholders and
other factors. Potentially, available business opportunities may
occur in many different industries and at various stages of
development, all of which will make the task of comparative
investigation and analysis of such business opportunities
extremely difficult and complex.
The Company has, and will continue to have, no capital with
which to provide the owners of business opportunities with any
significant cash or other assets. However, management believes
the Company will be able to offer owners of acquisition
candidates the opportunity to acquire a controlling ownership
interest in a publicly registered company without incurring the
cost and time required to conduct an initial public offering.
The owners of the business opportunities will, however, incur
significant legal and accounting costs in connection with
acquisition of a business opportunity, including the costs of
preparing Form 8-K's, 10-K's or 10-KSB's, agreements and related
reports and documents. The Securities Exchange Act of 1934 (the
"34 Act") specifically requires that any merger or acquisition
candidate comply with all applicable reporting requirements,
which include providing audited financial statements to be
included within the numerous filings relevant to complying with
the 34 Act. Nevertheless, the officers and directors of the
Company have not conducted market research and are not aware of
statistical data which would support the perceived benefits of a
merger or acquisition transaction for the owners of a business
opportunity.
The analysis of new business opportunities will be
undertaken by, or under the supervision of, the officers and
directors of the Company, none of whom is a professional business
analyst. Management intends to concentrate on identifying
preliminary prospective business opportunities which may be
brought to its attention through present associations of the
Company's officers and directors, or by the Company's
shareholders. In analyzing prospective business opportunities,
management will consider such matters as the available technical,
financial and managerial resources; working capital and other
financial requirements; history of operations, if any; prospects
for the future; nature of present and expected competition; the
quality and experience of management services which may be
available and the depth of that management; the potential for
further research, development, or exploration; specific risk
factors not now foreseeable but which then may be anticipated to
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impact the proposed activities of the Company; the potential for
growth or expansion; the potential for profit; the perceived
public recognition of acceptance of products, services, or
trades; name identification; and other relevant factors.
Officers and directors of the Company expect to meet personally
with management and key personnel of the business opportunity as
part of their investigation. To the extent possible, the Company
intends to utilize written reports and personal investigation to
evaluate the above factors. The Company will not acquire or
merge with any company for which audited financial statements
cannot be obtained within a reasonable period of time after
closing of the proposed transaction.
Management of the Company, while not especially experienced
in matters relating to the new business of the Company, shall
rely upon their own efforts and, to a much lesser extent, the
efforts of the Company's shareholders, in accomplishing the
business purposes of the Company. It is not anticipated that any
outside consultants or advisors will be utilized by the Company
to effectuate its business purposes described herein. However,
if the Company does retain such an outside consultant or advisor,
management will review such consultant or advisor's credentials
as well as his or her experience and reputation in providing
advice to management in implementing its business plan, which
services will be limited to analysis of a prospective merger or
acquisition candidate to assist management in evaluating a
particular candidate and any cash fee earned by such party will
need to be paid by the prospective merger/acquisition candidate,
as the Company has no cash assets with which to pay such
obligation. There have been no contracts or agreements with any
outside consultants and none are anticipated in the future.
The Company will not restrict its search for any specific
kind of firms, but may acquire a venture which is in its
preliminary or development stage, which is already in operation,
or in essentially any stage of its corporate life. It is
impossible to predict at this time the status of any business in
which the Company may become engaged, in that such business may
need to seek additional capital, may desire to have its shares
publicly traded, or may seek other perceived advantages which the
Company may offer. However, the Company does not intend to
obtain funds in one or more private placements to finance the
operation of any acquired business opportunity until such time as
the Company has successfully consummated such a merger or
acquisition.
It is anticipated that the Company will incur nominal
expenses in the implementation of its business plan described
herein. Because the Company has no capital with which to pay
these anticipated expenses, present management of the Company
will pay these charges with their personal funds, as interest
free loans to the Company. However, the only opportunity which
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management has to have these loans repaid will be from a
prospective merger or acquisition candidate. Management has
agreed among themselves that the repayment of any loans made on
behalf of the Company will not impede, or be made conditional in
any manner, to consummation of a proposed transaction.
The Company is subject to the assessment of penalties in the
minimum amount of $1,600 for failure to file federal income tax
returns since its inception (see Note 2 to Financial Statements).
Because the Company has no capital with which to pay this
obligation, the anticipated penalty will need to be paid by the
prospective merger/acquisition candidate as a successor to the
Company, and such assumption of this obligation will be a part of
the negotiations with the prospective merger/acquisition
candidate.
Acquisition of Opportunities
In implementing a structure for a particular business
acquisition, the Company may become a party to a merger,
consolidation, reorganization, joint venture, or licensing
agreement with another corporation or entity. It may also
acquire stock or assets of an existing business. On the
consummation of a transaction, it is probable that the present
management and shareholders of the Company will no longer be in
control of the Company. In addition, the Company's directors
may, as part of the terms of the acquisition transaction, resign
and be replaced by new directors without a vote of the Company's
shareholders or may sell their stock in the Company. Any terms
of sale of the shares presently held by officers and/or directors
of the Company will be also afforded to all other shareholders of
the Company on similar terms and conditions. Any and all such
sales will only be made in compliance with the securities laws of
the United States and any applicable state.
It is anticipated that any securities issued in any such
reorganization would be issued in reliance upon exemption from
registration under applicable federal and state securities laws.
In some circumstances, however, as a negotiated element of its
transaction, the Company may agree to register all or a part of
such securities immediately after the transaction is consummated
or at specified times thereafter. If such registration occurs,
of which there can be no assurance, it will be undertaken by the
surviving entity after the Company has successfully consummated a
merger or acquisition and the Company is no longer considered a
"shell" company. Until such time as this occurs, the Company
will not attempt to register any additional securities. The
issuance of substantial additional securities and their potential
sale into any trading market which may develop in the Company's
securities may have a depressive effect on the value of the
Company's securities in the future, if such a market develops, of
which there is no assurance.
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While the actual terms of a transaction to which the Company
may be a party cannot be predicted, it may be expected that the
parties to the business transaction will find it desirable to
avoid the creation of a taxable event and thereby structure the
acquisition in a so-called "tax-free" reorganization under
Sections 368(a)(1) or 351 of the Internal Revenue Code (the
"Code"). In order to obtain tax-free treatment under the Code,
it may be necessary for the owners of the acquired business to
own 80% or more of the voting stock of the surviving entity. In
such event, the shareholders of the Company, would retain less
than 20% of the issued and outstanding shares of the surviving
entity, which would result in significant dilution in the equity
of such shareholders.
As part of the Company's investigation, officers and
directors of the Company will meet personally with management and
key personnel, may visit and inspect material facilities, obtain
independent analysis of verification of certain information
provided, check references of management and key personnel, and
take other reasonable investigative measures, to the extent of
the Company's limited financial resources and management
expertise. The manner in which the Company participates in an
opportunity will depend on the nature of the opportunity, the
respective needs and desires of the Company and other parties,
the management of the opportunity and the relative negotiation
strength of the Company and such other management.
With respect to any merger or acquisition, negotiations with
target company management is expected to focus on the percentage
of the Company which the target company shareholders would
acquire in exchange for all of their shareholdings in the target
company. Depending upon, among other things, the target
company's assets and liabilities, the Company's shareholders will
in all likelihood hold a substantially lesser percentage
ownership interest in the Company following any merger or
acquisition. The percentage ownership may be subject to
significant reduction in the event the Company acquires a target
company with substantial assets. Any merger or acquisition
effected by the Company can be expected to have a significant
dilutive effect on the percentage of shares held by the Company's
then shareholders.
The Company will participate in a business opportunity only
after the negotiation and execution of appropriate written
agreements. Although the terms of such agreements cannot be
predicted, generally such agreements will require some specific
representations and warranties by all of the parties thereto,
will specify certain events of default, will detail the terms of
closing and the conditions which must be satisfied by each of the
parties prior to and after such closing, will outline the manner
of bearing costs, including costs associated with the Company's
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attorneys and accountants, will set forth remedies on default and
will include miscellaneous other terms.
As stated herein above, the Company will not acquire or
merge with any entity which cannot provide independent audited
financial statements within a reasonable period of time after
closing of the proposed transaction. The Company is subject to
all of the reporting requirements included in the 34 Act.
Included in these requirements is the affirmative duty of the
Company to file independent audited financial statements as part
of its Form 8-K to be filed with the Securities and Exchange
Commission upon consummation of a merger or acquisition, as well
as the Company's audited financial statements included in its
annual report on Form 10-K (or 10-KSB, as applicable). If such
audited financial statements are not available at closing, or
within time parameters necessary to insure the Company's
compliance with the requirements of the 34 Act, or if the audited
financial statements provided do not conform to the
representations made by the candidate to be acquired in the
closing documents, the closing documents will provide that the
proposed transaction will be voidable, at the discretion of the
present management of the Company. If such transaction is
voided, the agreement will also contain a provision providing for
the acquisition entity to reimburse the Company for all costs
associated with the proposed transaction.
Year 2000 Disclosure
Many existing computer programs use only two digits to
identify a year in the date field. These programs were designed
and developed without considering the impact of the upcoming
change in the century. If not corrected, many computer
applications could fail or create erroneous results by or at the
Year 2000. As a result, many companies will be required to
undertake major projects to address the Year 2000 issue. Because
the Company has no assets, including any personal property such
as computers, it is not anticipated that the Company will incur
any negative impact as a result of this potential problem.
However, it is possible that this issue may have an impact on the
Company after the Company successfully consummates a merger or
acquisition. Management intends to address this potential
problem with any prospective merger or acquisition candidate.
There can be no assurances that new management of the Company
will be able to avoid a problem in this regard after a merger or
acquisition is so consummated.
Competition
The Company will remain an insignificant participant among
the firms which engage in the acquisition of business
opportunities. There are many established venture capital and
financial concerns which have significantly greater financial and
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personnel resources and technical expertise than the Company. In
view of the Company's combined extremely limited financial
resources and limited management availability, the Company will
continue to be at a significant competitive disadvantage compared
to the Company's competitors.
Item 3. Description of Property
The Company has no properties and at this time has no
agreements to acquire any properties. The Company intends to
attempt to acquire assets or a business in exchange for its
securities which assets or business is determined to be desirable
for its objectives.
The Company operates from its offices at 6 Venture, Suite
207, Irvine, California 92618. This space is provided to the
Company on a rent free basis by Bryan A. Gianesin, a shareholder
of and legal counsel to the Company, and it is anticipated that
this arrangement will remain until such time as the Company
successfully consummates a merger or acquisition. Management
believes that this space will meet the Company's needs for the
foreseeable future.
Mr. Gianesin has offered the use of his conference room at
his offices at 6 Venture, Suite 207, Irvine, California, for
meetings for the officers and directors of the Company at no
charge and as a convenient repository for the books and records
of the Company. Further, as legal counsel, Mr. Gianesin will
advise the Company on material issues pertinent to its business
opportunities.
Item 4. Security Ownership of Certain Beneficial Owners and
Management
The table below lists the beneficial ownership of the
Company's voting securities by each person known by the Company
to be the beneficial owner of more than 5% of such securities, as
well as the securities of the Company beneficially owned by all
directors and officers of the Company. Unless otherwise
indicated, the shareholders listed possess sole voting and
investment power with respect to the shares shown.
Name and Amount and
Address of Nature of
Beneficial Beneficial Percent of
Title of Class Owner Owner Class
- -----------------------------------------------------------------
Common Brad A. Hibbard(1) 125,000 25%
441 Old Coast Hwy.#15
Santa Barbara, CA 93103
15
<PAGE>
Name and Amount and
Address of Nature of
Beneficial Beneficial Percent of
Title of Class Owner Owner Class
- -----------------------------------------------------------------
Common Cleora Louey(1) 100,000 20%
27068 La Paz Road,#218
Aliso Viejo,CA 92656
Common Douglas P. Morrison(1) 100,000 20%
8895 Town Center Dr.#105
San Diego, CA 92122
Common All Officers and
Directors as a
Group (3 persons) 325,000 65%
_________________________
The balance of the Company's securities are held by seven
persons.
Item 5. Directors, Executive Officers, Promoters and Control
Persons.
The directors and officers of the Company are as follows:
Name Age Position
---- --- --------
Brad A. Hibbard 29 President, Director
Cleora Louey 49 Secretary, Director
Douglas P. Morrison 31 Director
The above listed officers and directors will serve until the
next annual meeting of the shareholders or until their death,
resignation, retirement, removal, or disqualification, or until
their successors have been duly elected and qualified. Vacancies
in the existing Board of Directors are filled by majority vote of
the remaining Directors. Officers of the Company serve at the
will of the Board of Directors.
The Company does not presently intend to issue any
additional stock to management or promotors or their affiliates
or associates in exchange for their services or for any other
consideration. However, if a business opportunity is found which
meet the criteria for the Company, incentive stock options may be
considered for management only by the Board of Directors, but
only under a strict set of criteria based upon the performance of
the Company.
16
<PAGE>
There are no agreements or understanding for any officer or
director to resign at the understanding of any other person and
none of the officers or directors are acting on behalf or will
act at the direction of any other person.
Only the participation of the named officers and directors
will be material to the operations of the Company and no
promotors exist who will act on behalf of the Company.
Resumes
Brad A. Hibbard, President and a director. Mr. Hibbard has
held his positions with the Company since January 1999. From May
1998 through the present, Mr. Hibbard has been a territory
manager for Boston Scientific Corporation, Lake Forest,
California. Mr. Hibbard is a procedural consultant in the use of
less invasive gastrointestinal laboratory devices. Prior to
that, from October 1995 to May 1998, Mr. Hibbard was a sales
representative for TAP Pharmaceuticals, Santa Barbara,
California. Mr. Hibbard received a Bachelor of Arts Degree from
the University of Texas At Austin in 1993. Mr. Hibbard will
devote approximately 20 hours per month to the business of the
Company.
Cleora Louey, Secretary and Director. Ms. Louey held the
positions of President, Secretary and as a Director of the
Company since its inception until January 1999. In January 1999,
Ms. Louey was re-elected as Secretary and as a Director of the
Company. Since December 1998, Ms. Louey has been employed as a
fitness consultant for Leo Fessenden Adult Day Care Center, San
Clemente, California. Prior to that, Ms. Louey was a self-
employed certified personal trainer in Lancaster, California.
Ms. Louey has various certifications in health and fitness. Ms.
Louey will devote approximately 10 hours per month to the
business of the Company.
Douglas P. Morrison, Director. Mr. Morrison has held his
position with the Company since January 1999. Since November
1997, Mr. Morrison has acted as President of Wired Financial
Corporation, San Diego, California where he is responsible for
managing the overall business operations for consumer, commercial
and medical accounts receivable. Prior to that, from January 1995
to November 1997, he was Vice President of Marketing for West
Capital Financial Services, Inc., San Diego , California where he
was responsible for purchasing consumer receivable accounts. Mr.
Morrison received a Bachelor of Science Degree in Business
Administration from the University of California at Berkeley,
California in 1991. Mr. Morrison will devote approximately 10
hours per month to the business of the Company.
17
<PAGE>
Prior "Blank Check" Experience
No officer or director of the Company has been an officer or
director of any "blank check" public reporting company, and no
officer or director has ever promoted, is promoting or will be
promoting any other blank check company during their tenure as an
officer and director of the Company.
Conflicts of Interest
Members of the Company's management are associated with
other firms involved in a range of business activities.
Consequently, there are potential inherent conflicts of interest
in their acting as officers and directors of the Company.
Insofar as the officers and directors are engaged in other
business activities, management anticipates it will devote only a
minor amount of time to the Company's affairs.
The officers and directors of the Company are now and may in
the future become shareholders, officers or directors of other
companies which may be formed for the purpose of engaging in
business activities similar to those conducted by the Company.
Accordingly, additional direct conflicts of interest may arise in
the future with respect to such individuals acting on behalf of
the Company or other entities. Moreover, additional conflicts of
interest may arise with respect to opportunities which come to
the attention of such individuals in the performance of their
duties or otherwise. The Company does not currently have a right
of first refusal pertaining to opportunities that come to
management's attention insofar as such opportunities may relate
to the Company's proposed business operations.
The officers and directors are, so long as they are officers
or directors of the Company, subject to the restriction that all
opportunities contemplated by the Company's plan of operation
which come to their attention, either in the performance of their
duties or in any other manner, will be considered opportunities
of, and be made available to the Company and the companies that
they are affiliated with on an equal basis. A breach of this
requirement will be a breach of the fiduciary duties of the
officer or director. If the Company or the companies in which
the officers and directors are affiliated with both desire to
take advantage of an opportunity, then said officers and
directors would abstain from negotiating and voting upon the
opportunity. However, all directors may still individually take
advantage of opportunities if the Company should decline to do
so. Furthermore, no officer or director of the Company has ever
promoted, is promoting or will be promoting any other blank check
company during their tenure as an officer and director of the
Company. Accordingly, there presently exists no conflict of
interest in this regard. Except as set forth above, the Company
18
<PAGE>
has not adopted any other conflict of interest policy with
respect to such transactions.
Investment Company Act of 1940
Although the Company will be subject to regulation under the
Securities Act of 1933 and the Securities Exchange Act of 1934,
management believes the Company will not be subject to regulation
under the Investment Company Act of 1940 insofar as the Company
will not be engaged in the business of investing or trading in
securities. In the event the Company engages in business
combinations which result in the Company holding passive
investment interests in a number of entities, the Company could
be subject to regulation under the Investment Company Act of
1940. In such event, the Company would be required to register
as an investment company and could be expected to incur
significant registration and compliance costs. The Company has
obtained no formal determination from the Securities and Exchange
Commission as to the status of the Company under the Investment
Company Act of 1940 and, consequently, any violation of such Act
would subject the Company to material adverse consequences. The
Company's Board of Directors unanimously approved a resolution
stating that it is the Company's desire to be exempt from the
Investment Company Act of 1940 via Regulation 3a-2 thereto.
Item 6. Executive Compensation.
None of the Company's officers and/or directors receive any
compensation for their respective services rendered unto the
Company, nor have they received such compensation in the past.
They all have agreed to act without compensation until authorized
by the Board of Directors, which is not expected to occur until
the Company has generated revenues from operations after
consummation of a merger or acquisition. As of the date of this
Registration Statement, the Company has no funds available to pay
directors. Further, none of the directors are accruing any
compensation pursuant to any agreement with the Company and the
Company does not intend to issue any securities to its officers
and/or directors in consideration for their services.
It is possible that, after the Company successfully
consummates a merger or acquisition with an unaffiliated entity,
that entity may desire to employ or retain one or a number of
members of the Company's management for the purposes of providing
services to the surviving entity, or otherwise provide other
compensation to such persons. However, the Company has adopted a
policy whereby the offer of any post-transaction remuneration to
members of management will not be a consideration in the
Company's decision to undertake any proposed transaction. Each
member of management has agreed to disclose to the Company's
Board of Directors any discussions concerning possible
compensation to be paid to them by any entity which proposes to
19
<PAGE>
undertake a transaction with the Company and further, to abstain
from voting on such transaction. Therefore, as a practical
matter, if each member of the Company's Board of Directors is
offered compensation in any form from any prospective merger or
acquisition candidate, the proposed transaction will not be
approved by the Company's Board of Directors as a result of the
inability of the Board to affirmatively approve such a
transaction.
It is possible that persons associated with management may
refer a prospective merger or acquisition candidate to the
Company. In the event the Company consummates a transaction with
any entity referred by associates of management, it is possible
that such an associate will be compensated for their referral in
the form of a finder's fee. It is anticipated that this fee will
be either in the form of restricted common stock issued by the
Company as part of the terms of the proposed transaction, or will
be in the form of cash consideration. However, if such
compensation is in the form of cash, such payment will be
tendered by the acquisition or merger candidate, because the
Company has insufficient cash available. The amount of such
finder's fee cannot be determined as of the date of this
Registration Statement, but is expected to be comparable to
consideration normally paid in like transactions. No member of
management of the Company will receive any finders fee, either
directly or indirectly, as a result of their respective efforts
to implement the Company's business plan outlined herein.
No retirement, pension, profit sharing, stock option or
insurance programs or other similar programs have been adopted by
the Company for the benefit of its employees.
Item 7. Certain Relationships and Related Transactions.
There have been no related party transactions, or any other
transactions or relationships required to be disclosed pursuant
to Item 404 of Regulation S-B.
Item 8. Description of Securities.
The Company's authorized capital stock consists of
15,000,000 shares, all of which are Common Shares, par value
$0.001 per share. There are 500,000 Common Shares issued and
outstanding as of the date of this filing. There are no
preferred shares authorized, issued or outstanding.
Common Stock. All shares of Common Stock have equal voting
rights and, when validly issued and outstanding, are entitled to
one vote per share in all matters to be voted upon by
shareholders. The shares of Common Stock have no preemptive,
subscription, conversion or redemption rights and may be issued
only as fully-paid and nonassessable shares. Cumulative voting
20
<PAGE>
in the election of directors is not permitted, which means that
the holders of a majority of the issued and outstanding shares of
Common Stock represented at any meeting at which a quorum is
present will be able to elect the entire Board of Directors if
they so choose and, in such event, the holders of the remaining
shares of Common Stock will not be able to elect any directors.
In the event of liquidation of the Company, each shareholder is
entitled to receive a proportionate share of the Company's assets
available for distribution to shareholders after the payment of
liabilities and after distribution in full of preferential
amounts, if any. All shares of the Company's Common Stock issued
and outstanding are fully-paid and nonassessable. Holders of the
Common Stock are entitled to share pro rata in dividends and
distributions with respect to the Common Stock, as may be
declared by the Board of Directors out of funds legally available
therefor.
The proposed business activities described herein classify
the Company as a "blank check" company. Many states have enacted
statutes, rules and regulations limiting the sale of securities
of "blank check" companies in their respective jurisdictions.
Management does not intend to undertake any efforts to cause a
market to develop in the Company's securities until such time as
the Company has successfully implemented its business plan
described herein. Relevant thereto, each shareholder of the
Company has executed and delivered a "lock-up" letter agreement,
affirming that they shall not sell their respective shares of the
Company's common stock until such time as the Company has
successfully consummated a merger or acquisition and the Company
is no longer classified as a "blank check" company. In order to
provide further assurances that no trading will occur in the
Company's securities until a merger or acquisition has been
consummated, each shareholder has agreed to place their
respective stock certificate with the Company's legal counsel,
Bryan A. Gianesin, who will not release these respective
certificates until such time as legal counsel has confirmed that
a merger or acquisition has been successfully consummated. Mr.
Gianesin is also a shareholder of the Company. However, while
management believes that the procedures established to preclude
any sale of the Company's securities prior to closing of a merger
or acquisition will be sufficient, there can be no assurances
that the procedures established relevant herein will
unequivocally limit any shareholder's ability to sell their
respective securities before such closing.
21
<PAGE>
PART II
Item 1. Market Price for Common Equity and Related Stockholder
Matters.
There is no trading market for the Company's Common Stock at
present and there has been no trading market to date. Management
has not undertaken any discussions, preliminary or otherwise,
with any prospective market maker concerning the participation of
such market maker in the aftermarket for the Company's securities
and management does not intend to initiate any such discussions
until such time as the Company has consummated a merger or
acquisition. There is no assurance that a trading market will
ever develop or, if such a market does develop, that it will
continue.
a. Market Price. The Company's Common Stock is not quoted
at the present time.
The Securities and Exchange Commission adopted Rule 15g-9,
which established the definition of a "penny stock," for purposes
relevant to the Company, as any equity security that has a market
price of less than $5.00 per share or with an exercise price of
less than $5.00 per share, subject to certain exceptions. For
any transaction involving a penny stock, unless exempt, the rules
require: (i) that a broker or dealer approve a person's account
for transactions in penny stocks; and (ii) the broker or dealer
receive from the investor a written agreement to the transaction,
setting forth the identity and quantity of the penny stock to be
purchased. In order to approve a person's account for
transactions in penny stocks, the broker or dealer must (i)
obtain financial information and investment experience and
objectives of the person; and (ii) make a reasonable
determination that the transactions in penny stocks are suitable
for that person and that person has sufficient knowledge and
experience in financial matters to be capable of evaluating the
risks of transactions in penny stocks. The broker or dealer must
also deliver, prior to any transaction in a penny stock, a
disclosure schedule prepared by the Commission relating to the
penny stock market, which, in highlight form, (i) sets forth the
basis on which the broker or dealer made the suitability
determination; and (ii) that the broker or dealer received a
signed, written agreement from the investor prior to the
transaction. Disclosure also has to be made about the risks of
investing in penny stock in both public offering and in secondary
trading, and about commissions payable to both the broker-dealer
and the registered representative, current quotations for the
securities and the rights and remedies available to an investor
in cases of fraud in penny stock transactions. Finally, monthly
statements have to be sent disclosing recent price information
for the penny stock held in the account and information on the
limited market in penny stocks.
22
<PAGE>
The National Association of Securities Dealers, Inc. (the
"NASD"), which administers NASDAQ, has established criteria for
continued NASDAQ eligibility. In order to continue to be
included on NASDAQ, a company must maintain $2,000,000 in total
assets, a $200,000 market value of its publicly traded securities
and $1,000,000 in total capital and surplus. In addition,
continued inclusion requires two market makers and a minimum bid
price of $1.00 per share, provided, however, that if a company
falls below such minimum bid price it will remain eligible for
continued inclusion on NASDAQ if the market value of its publicly
traded securities is at least $1,000,000 and the Company has
$2,000,000 in capital and surplus. The NASD is presently
considering increasing these standards, but as of the date of
this Registration Statement, no definitive action has been taken
in this regard.
Management intends to strongly consider undertaking a
transaction with any merger or acquisition candidate which will
allow the Company's securities to be traded without the aforesaid
limitations. However, there can be no assurances that, upon a
successful merger or acquisition, the Company will qualify its
securities for listing on NASDAQ or some other national exchange,
or be able to maintain the maintenance criteria necessary to
insure continued listing. The failure of the Company to qualify
its securities or to meet the relevant maintenance criteria after
such qualification in the future may result in the discontinuance
of the inclusion of the Company's securities on a national
exchange. In such events, trading, if any, in the Company's
securities may then continue in the non-NASDAQ over-the-counter
market. As a result, a shareholder may find it more difficult to
dispose of, or to obtain accurate quotations as to the market
value of, the Company's securities.
b. Holders. There are ten (10) holders of the Company's
Common Stock. In September 1982, the Company issued 500 of its
Common Shares for an aggregate of $500 in cash ($1.00 per share).
On January 6, 1999, the Company authorized a forward split of
1,000 to 1 and authorized a par value of ($.001). Presently
there are 500,000 shares of the Company's common stock
outstanding with 15,000,000 common shares authorized. All of the
issued and outstanding shares of the Company's Common Stock were
issued pursuant to exemption from the registration requirements
included under Rule 504 of Regulation D of the Securities Act of
1933, as amended. The holders of the Common Stock were either
"accredited investors" (as that term is defined in the 1933 Act)
or were provided all information necessary in order to allow each
investor to exercise their respective business judgment as to the
merits of the investment.
As of the date of this Registration Statement, 500,000
shares of the Company's Common Stock are eligible for sale under
Rule 144 promulgated under the Securities Act of 1933, as
23
<PAGE>
amended, subject to certain limitations included in said Rule.
In general, under Rule 144, a person (or persons whose shares are
aggregated), who has satisfied a one year holding period, under
certain circumstances, may sell within any three-month period a
number of shares which does not exceed the greater of one percent
of the then outstanding Common Stock or the average weekly
trading volume during the four calendar weeks prior to such sale.
Rule 144 also permits, under certain circumstances, the sale of
shares without any quantity limitation by a person who has
satisfied a two-year holding period and who is not, and has not
been for the preceding three months, an affiliate of the Company.
c. Dividends. The Company has not paid any dividends to
date and has no plans to do so in the immediate future.
Item 2. Legal Proceedings.
There is no litigation pending or threatened by or against
the Company.
Item 3. Changes in and Disagreements With Accountants on
Accounting and Financial Disclosure.
The Company has not changed accountants since its formation
and there are no disagreements with the findings of said
accountants.
Item 4. Recent Sales of Unregistered Securities.
In September 1982 the Company issued 500 shares of its
common stock to 10 persons at a price of $1.00 per share. All of
the shares of Common Stock of the Company previously issued have
been issued for investment purposes in a "private transaction"
and are "restricted" shares as defined in Rule 144 under the
Securities Act of 1933, as amended (the "Act"). These shares may
not be offered for public sale except under Rule 144, or
otherwise, pursuant to the Act.
As of the date of this Registration Statement, all of the
issued and outstanding shares of the Company's Common Stock are
eligible for sale under Rule 144 promulgated under the Securities
Act of 1933, as amended, subject to certain limitations included
in said Rule. However, all of the shareholders of the Company
have executed and delivered a "lock-up" letter agreement which
provides that each such shareholder shall not sell their
respective securities until such time as the Company has
successfully consummated a merger or acquisition. Further, each
shareholder has placed their respective stock certificate with
the Company's legal counsel, Bryan A. Gianesin, who has agreed
not to release any of the certificates until the Company has
closed a merger or acquisition. Mr. Gianesin is also a
shareholder of the Company. Any liquidation by the current
24
<PAGE>
shareholders after the release from the "lock-up" selling
limitation period may have a depressive effect upon the trading
prices of the Company's securities in any future market which may
develop.
In general, under Rule 144, a person (or persons whose
shares are aggregated) who has satisfied a one year holding
period, under certain circumstances, may sell within any three-
month period a number of shares which does not exceed the greater
of one percent of the then outstanding Common Stock or the
average weekly trading volume during the four calendar weeks
prior to such sale. Rule 144 also permits, under certain
circumstances, the sale of shares without any quantity limitation
by a person who has satisfied a two year holding period and who
is not, and has not been for the preceding three months, an
affiliate of the Company.
Item 5. Indemnification of Directors and Officers.
The Company's Bylaws include provisions providing for the
indemnification of officers and directors and other persons
against expenses, judgments, fines and amounts paid in settlement
in connection with threatened, pending or completed suits or
proceedings against such persons by reason of serving or having
served as officers, directors or in other capacities, except in
relation to matters with respect to which such persons shall be
determined not to have acted in good faith and in the best
interests of the Company. With respect to matters as to which
the Company's officers and directors and others are determined to
be liable for misconduct or negligence, including gross
negligence in the performance of their duties to the Company,
Nevada law provides for indemnification only to the extent that
the court in which the action or suit is brought determines that
such person is fairly and reasonably entitled to indemnification
for such expenses which the court deems proper.
Insofar as indemnification for liabilities arising under the
1933 Act may be permitted to officers, directors or persons
controlling the Company pursuant to the foregoing, the Company
has been informed that in the opinion of the U.S. Securities and
Exchange Commission such indemnification is against public policy
as expressed in the 1933 Act, and is therefore unenforceable.
In accordance with the laws of the State of Nevada, the
Company's Bylaws authorize indemnification of a director,
officer, employee, or agent of the Company for expenses incurred
in connection with any action, suit, or proceeding to which he or
she is named a party by reason of his having acted or served in
such capacity, except for liabilities arising from his own
misconduct or negligence in performance of his or her duty. In
addition, even a director, officer, employee, or agent of the
Company who was found liable for misconduct or negligence in the
25
<PAGE>
performance of his or her duty may obtain such indemnification
if, in view of all the circumstances in the case, a court of
competent jurisdiction determines such person is fairly and
reasonably entitled to indemnification. Insofar as
indemnification for liabilities arising under the Securities Act
of 1933, as amended, may be permitted to directors, officers, or
persons controlling the issuing Company pursuant to the foregoing
provisions, the Company has been informed that in the opinion of
the Securities and Exchange Commission, such indemnification is
against public policy as expressed in the Act and is therefore
unenforceable.
PART F/S
Financial Statements.
The following financial statements are attached to this
Registration Statement and filed as a part thereof. See page 27.
1) Table of Contents - Financial Statements
2) Independent Auditors' Report
3) Balance Sheets
4) Statement of Revenues and Expenses
5) Statement of Cash Flows
6) Statement of Changes in Stockholders' Equity
7) Notes to Financial Statements
26
<PAGE>
N.T. PROPERTIES, INC.
(a Development Stage Company)
(A Nevada corporation)
FINANCIAL STATEMENTS
AND
INDEPENDENT AUDITOR'S REPORT
For the Years Ended December 31, 1998
and December 31, 1997
and for the Period September 21, 1982 (inception)
through December 31, 1998
27
<PAGE>
INDEX
PAGE
Independent Auditor's Report 1
Balance Sheets 2
Statements of Revenues and Expenses 3
Statements of Cash Flows 4
Statements of Changes in Stockholders' Equity/(Deficit) 5
Notes to Financial Statements 6
28
<PAGE>
GARY A. CASE
CERTIFIED PUBLIC ACCOUNTANT
Brea Corporate Plaza
3230 E. Imperial Highway, Ste. 200
Brea, California 92821-6734
Telephone: (714)986-1850
Facsimile: (714)986-1855
INDEPENDENT AUDITOR'S REPORT
TO THE BOARD OF DIRECTORS
OF N.T. PROPERTIES, INC.
We have audited the accompanying balance sheets of N.T.PROPERTIES, INC.
(a Development Stage Company) as of December 31, 1998 and December 31, 1997,
the related statements of Revenues and Expenses, Changes in Stockholders'
Equity/(Deficit) and Cash Flows for the Years ended December 31, 1998,
December 31, 1997, and the period September 21, 1982 (inception) through
December 31, 1998. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on these
financial statements based on our audit.
We conducted the audit in accordance with generally accepted audit
standards. Those standards require that we plan and perform the audit 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 the audit provides a
reasonable basis for our opinion.
The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As discussed in Note 1 to the
financial statements, the Company is in the development stage of operations
and has not generated revenues from operations. Because the Company is in
the development stage of operations, substantial doubt is raised about its
ability to continue as a going concern. The Company's plans in regard to
these matters are also described in Note 1. The financial statements do not
include any adjustments that might result from the outcome of this
uncertainty.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of N.T. PROPERTIES, INC. as
of December 31, 1998 and December 31, 1997 and the results of its operations
and its cash flows for the Years ended December 31, 1998 and December 31,
1997, and the period September 21, 1982 (inception) through December 31,
1998 in conformity with generally accepted accounting principals.
s/Gary A. Case
_____________________________________
GARY A. CASE, CPA
Brea, California
January 15, 1999
1
29
<PAGE>
<TABLE>
N.T. PROPERTIES, INC.
(a Development Stage Company)
(A Nevada corporation)
BALANCE SHEETS
<CAPTION>
ASSETS: December 31, December 31,
1998 1997
-------- --------
<S> <C> <C>
Current Assets $ 0 $ 0
Organization Costs 500 500
-------- --------
Total Assets $ 500 500
======== ========
LIABILITIES
Current Liabilities
Accounts Payable $ 1,600 $ 1,500
-------- --------
Total Current Liabilities 1,600 1,500
-------- --------
Total Liabilities 1,600 1,500
STOCKHOLDERS' EQUITY
Common Stock - Par Value $.001 per shares;
15,000,000 Shares Authorized
500,000 Shares Issued and Outstanding 500 500
Additional Paid-In Capital 0 0
Retained Deficit, accumulated in the
development stage ( 1,600) ( 1,500)
Total Stockholders' Equity ( 1,100) ( 1,000)
Total Liabilities and Stockholders' Equity $ 500 $ 500
======== ========
<FN>
See accompanying notes and accountant's report.
</TABLE>
2
30
<PAGE>
<TABLE>
N.T. PROPERTIES, INC.
(a Development Stage Company)
(A Nevada corporation)
STATEMENT OF REVENUES AND EXPENSES
<CAPTION>
Period
9/21/82
(Inception)
Year Ended Year Ended to
12/31/98 12/31/97 12/31/98
------- ------- --------
<S> <C> <C> <C>
REVENUE:
Total Revenue $ 0 $ 0 $ 0
------- ------- --------
EXPENSES:
Taxes and Licenses 100 100 1,600
------- ------- --------
Total Expenses 100 100 1,600
------- ------- --------
Net Income/(Loss) $ ( 100) $ ( 100) $ (1,600)
======= ======= ========
Net loss per share $ .20 $ .20 $ 3.20
======= ======= ========
<FN>
See accompanying notes and accountant's report.
</TABLE>
3
31
<PAGE>
<TABLE>
N.T. PROPERTIES, INC.
(a Development Stage Company)
(A Nevada corporation)
STATEMENT OF CASH FLOWS
<CAPTION>
Period
9/21/82
(Inception)
Year Ended Year Ended to
12/31/98 12/31/97 12/31/98
------- ------- -------
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Cash Received from Operating Activities $ 0 $ 0 $ 0
Cash Paid for Operating Activities 0 0 0
------- ------- -------
Net Cash Used By Operating Activities 0 0 0
CASH FLOWS FROM INVESTING ACTIVITIES
Net Cash Used in Investing Activities 0 0 (500)
------- ------- -------
CASH FLOWS FROM FINANCING ACTIVITIES
Net Cash From Financing Activities 0 0 500
------- ------- -------
Net Decrease in Cash and Cash Equivalents 0 0 0
Cash and Cash Equivalents at
Beginning of Period 0 0 0
------- ------- -------
Cash and Cash Equivalents
at End of Period $ 0 $ 0 $ 0
======= ======= =======
Reconciliation of Net Profit to Net Cash
Provided by Operating Activities:
Net Income/(Loss) $ ( 100) $ ( 100) $(1,600)
Adjustments to Reconcile Net Income
to Net Provided by Operating
Activities:
Increase in Accounts Payable 100 100 1,600
------- ------- -------
Total Adjustments 100 100 1,600
------- ------- -------
NET CASH PROVIDED BY
OPERATING ACTIVITIES $ 0 $ 0 $ 0
======= ======= =======
<FN>
See accompanying notes and accountant's report.
</TABLE>
4
32
<PAGE>
<TABLE>
N.T. PROPERTIES, INC.
(a Development Stage Company)
(A Nevada corporation)
STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY/(DEFICIT)
<CAPTION>
Number of Additional Retained
Common Common Paid-In Earnings
Shares Stock Capital (Deficit) Total
------- -------- -------- -------- -------
<S> <C> <C> <C> <C> <C>
Balance as at
September 21, 1982 0 0 0 0 0
Issuance of Common Stock 500 $ 500 $ 500
Net Income (Loss)
from September 21, 1982
(inception) to December
31, 1996 (1,400) (1,400)
------- -------- -------- -------- -------
Balance at December 31, 1996 500 500 0 (1,400) (900)
Net Income (Loss)
from December 31, 1997 (100) (100)
------- -------- -------- -------- -------
Balance as at
December 31, 1997 500 500 0 (1,500) (1,000)
Net Income (Loss)
December 31, 1998 (100) (100)
------- -------- -------- -------- -------
Balance at December 31, 1998 500 500 0 (1,600) (1,100)
======= ======== ======== ======== =======
<FN>
See accompanying notes and accountant's report.
</TABLE>
5
33
<PAGE>
N.T. PROPERTIES, INC.
(a Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
as of December 31, 1998 and December 31, 1997
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
N.T. Properties, Inc., a Nevada Corporation, was incorporated on
September 21, 1982. The Company intends to engage in one or more
mergers with or acquisitions of target entities which may be private
companies, partnerships, or sole proprietorship.
The Company is in the development stage, not yet commencing its
planned principal operations. The company has not yet generated
revenue. The Company is currently negotiating to merge or acquire
certain target entities with profitable operations or substantial
capital.
Net loss per common share is based on the weighted average of common
shares outstanding during the period. As of December 31, 1998 and
December 31, 1997, there were 500 outstanding shares of common stock.
NOTE 2: INCOME TAXES
The Company has not filed required federal income tax returns from
inception through 1997. Due to the late filing of these tax returns
a minimum penalty of $1,600.00 has been accrued and included in
accounts payable on the balance sheet.
NOTE 3: CAPITALIZATION
N.T. Properties, Inc. initially authorized 2,500 shares of common
stock at a par value $1.00 per share.
On September 21, 1982, N.T. Properties, Inc. issued 500 shares of
stock at $1.00 per share for $500.
NOTE 4: RELATED PARTY EVENTS
The Company maintains its principal offices in space provided by a
shareholder of the company on a rent free basis. The office is
located 6 Venture, Suite 207, Irvine, California.
NOTE 5: YEAR END DATE
The Company's year end is December 31.
NOTE 6: SUBSEQUENT EVENTS
The Company, on January 6, 1999, authorized a 1,000 to 1 forward
stock split. The Company also increased the total number of
authorized common stock to 15,000,000 shares.
6
34
<PAGE>
PART III
Item 1. Exhibit Index
No. Sequential
- --- Page No.
--------
(3) Certificate of Incorporation and Bylaws
3.1 Articles of Incorporation and Amendments 37
3.2 Bylaws 41
(4) Instruments Defining the Rights of Holders
4.1 Form of Lock-up Agreements Executed
by the Company's Shareholders 63
(27) Financial Data Schedule
27.1 Financial Data Schedule 74
35
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 12 of the
Securities Exchange Act of 1934, the Registrant has duly caused
this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized.
N. T. PROPERTIES, INC.
(Registrant)
Date: January 29, 1999
s/Brad Hibbard
------------------------------
Brad Hibbard, President
36
<PAGE>
N. T. PROPERTIES, INC.
_______________________________
EXHIBIT 3.1
_______________________________
ARTICLES OF INCORPORATION
AND AMENDMENTS
_______________________________
37
<PAGE>
F I L E D
IN THE OFFICE OF THE
SECRETARY OF STATE OF THE
STATE OF NEVADA
SEPT 21 1982
Wm. D. Swackhamer
Secretary of State
s/Wm. D. Swackhamer
No. 5578-82
ARTICLES OF INCORPORATION
OF
N. T. PROPERTIES, INC.
I
The name of this Corporation is N.T. PROPERTIES, INC.
II
The principal office or place of business of this corporation shall
be located in the County of Clark at:
4801 Spencer, Suite 159
Las Vegas Nevada 89109
III
The nature of the business or objects or purposes to be transacted,
promoted or carried on by the corporation shall be to engage in any
lawful activity.
IV
This corporation shall be authorized to issue only one class of shares
of stock; and the total number of shares which this corporation shall
be authorized to issue shall be 2,500; all of which shall be without
par value.
V
The names and addresses of the initial directors of the corporation
shall be as follows:
Jim Grace 21952 Cosala, Mission Viejo, CA 92691
Roland R. Mora 21508 Marguerite Parkway, Suite 182,
Mission Viejo, CA 92692
David H. Warmoth 23332 Saint Elena; Missions Viejo, CA 92691
VI
The shares of stock of this corporation shall not be subject to assess-
ment to pay the debts of the corporation.
38
<PAGE>
VII
The name and post office address of the incorporator signing these
articles of incorporation is:
David H. Warmoth
23332 Saint Elena
Mission Viejo, California 92691
VIII
The duration of the corporation shall be perpetual.
IN WITNESS WHEREOF, I have hereunto set my hand this twenty-third
day of August, 1982.
s/David H. Warmoth
------------------------------------
***
STATE OF CALIFORNIA ) On this the 23 day of August, 1982, before me,
) ss.: Anne Bluhm
COUNTY OR ORANGE ) ---------------------------------------------,
the undersigned Notary Public, personally
appeared
David H. Warmoth
---------------------------------------------
___ personally known to me
X
Official Seal --- proved to me on the basis of satisfactory
ANNE BLUHM evidence to be the persons(s) who name(s) is
Notary Public California subscribed to the within instrument and
Principal Office in acknowledged that he executed it.
Orange County WITNESS my hand and official seal.
My Commission Expires s/Anne Bluhm
Apr. 22, 1986 ---------------------------------------------
Notary's Signature
39
<PAGE>
F I L E D
IN THE OFFICE OF THE
SECRETARY OF STATE OF THE
STATE OF NEVADA
JAN 22 1999
No. C5578-22
s/Dean Heller
Dean Heller, Secretary of State
CERTIFICATE OF AMENDMENT OF ARTICLES OF INCORPORATION
(After Issuance of Stock)
N.T. PROPERTIES, INC.
-----------------------------
We, the undersigned Cleora Louey and
--------------------------------------------------
President
Cleora Louey of N. T. PROPERTIES, INC.
- -------------------------------- -------------------------------------------
Assistant Secretary Name of Corporation
do hereby certify:
That the Board of Directors of said corporation at a meeting duly convened,
held on the 6th day of January , 1999, adopted a resolution to
------- -------------------
amend the original articles as follows:
Article IV is hereby amended to read as follows:
-------------
A. The number of shares of which this corporation shall be entitled to
issue is 15,000,000, with a par value of $.001.
The number of shares of the corporation outstanding and entitled to vote on
an amended to the Articles of Incorporation is 500 that the said change(s) and
amended have been consented to and approved by a majority vote of the
stockholders holding at least a majority of each class of stock outstanding and
entitled to vote thereon.
s/Cleora Louey
------------------------------------------
President
s/Cleora Louey
------------------------------------------
Secretary
STATE OF CALIFORNIA )
) ss.
COUNTY OF ORANGE )
On this 13th day of January , 1999, before me, the undersigned Notary
------ -----------
Public, personally appeared Cleora Louey ,
-------------------------------------------
___ Personally known to me
or
X
--- Proved to me on the basis of satisfactory evidence to be the
person(s)whose name(s) is/are subscribed to the within Instrument and
acknowledged to me that he/she/they executed the same in his/her/their
authorized capacity(ies), and that by his/her/their signature(s) on the
instrument the person(s), or the entity upon behalf of which the person(s)
acted, executed the instrument.
WITNESS my hand and official seal.
Signature s/Ronald S. Levine (Seal)
-------------------------------------------
RONALD S. LEVINE
COMM...1193537
NOTARY PUBLIC CALIFORNIA
ORANGE COUNTY
My Term Exp. AUG 15, 2002
40
<PAGE>
N.T. PROPERTIES, INC.
______________________________
EXHIBIT 3.2
______________________________
BYLAWS
______________________________
41
<PAGE>
BYLAWS FOR THE REGULATION, EXCEPT AS
OTHERWISE PROVIDED BY STATUTE OR ITS
ARTICLES OF INCORPORATION, OF
N. T. Properties, Inc.
----------------------
(A Nevada Corporation)
ARTICLE I
Offices
SECTION 1.01 Principal Executive Office. The principal
executive office of the corporation is hereby fixed and located
at such place within or without the State of Nevada as shall be
fixed from time to time by the Board of Directors. The Board of
Directors is hereby granted full power and authority to change
said principal executive office from one location to another. If
the principal executive office is located outside Nevada, and the
corporation has one or more business offices in Nevada, the Board
of Directors shall fix and designate a principal business office
in the State of Nevada.
SECTION 1.02 Other Offices. Other business offices may at
any time be established by the Board of Directors at any place or
places where the corporation is qualified to do business.
ARTICLE II
Meetings of Shareholders
SECTION 2.01 Place of Meetings. All annual or other
meetings of shareholders shall be held at the executive office of
the corporation, or at any other place within or without the
State of Nevada which may be designated either by the Board of
Directors or by the written consent of all persons entitled to
vote thereat and not present at the meeting, given either before
or after the meeting and filed with the Secretary of State.
SECTION 2.02 Annual Meetings. The annual meetings of
shareholders shall be held on the second Monday of November of
every year; provided, however, that should said day fall on a
legal holiday, then any such annual meeting of shareholders shall
be held at the same time and place on the next day thereafter
ensuing which is a full business day. At such meetings, Directors
shall be elected, reports of the affairs of the corporation shall
be considered, and any other business may transacted which is
1
42
<PAGE>
within the powers of the directors. Written notice of each
annual meeting shall be given to each shareholder entitled to
vote, either personally or by mail or other means of written
communication, charges prepaid, addressed to such shareholder at
his or her address appearing on the books of the corporation or
given by him or her to the corporation for the purpose of notice.
If any notice or report addressed to the shareholder at the
address of such shareholder appearing on the books of the
corporation is returned to the corporation by the United States
Postal Service marked to indicate that the United States Postal
Service is unable to deliver the notice or report to the
shareholder at such address, all future notices or reports shall
be deemed to have been duly given without further mailing if the
same shall be available for the shareholder upon written demand
of the shareholder at the principal executive office of the
corporation for a period of one year from the date of the giving
of the notice or report to all other shareholders. If a
shareholder gives no address, notice shall be deemed to have
given if sent by mail or telegraphic or other means of written
communication addressed to the place where the principal
executive office of the corporation is situated, or if published
at least once in some newspaper of general circulation in the
county in which said principal executive office is located. All
such notices shall be given to each shareholder entitled thereto
not less than ten days nor more than 60 days before each annual
meeting. Any such notice shall be deemed to have been given at
the time when personally, or deposited in the mail or sent by
telegram or other means of written communication. An affidavit
of mailing of any such notice in accordance with the foregoing
provisions, executed by the Secretary, Assistant Secretary, or
any transfer agent of the corporation shall be prima facie
evidence of the giving of the notice. Such notices shall
specify:
(a) the place, the date, and the hour of such
meeting;
(b) those matters which the Board, at the time of
the mailing of the notice, intends to present for action by the
shareholders;
(c) if Directors are to be elected, the names of
nominees intended at the time of the notice to be presented by
management for election;
(d) the general nature of a proposal, if any, to
take action with respect to approval of (i) a contractor, (ii)
amendment of the articles of incorporation, (iii) a
reorganization of the corporation as defined in Sections 78.451,
et seq. of the State of Nevada, Domestic and Foreign Corporation
Laws, (iv) voluntary dissolution of the corporation, or (v) a
distribution in dissolution other than in accordance with the
rights of outstanding preferred shares, if any; and
2
43
<PAGE>
(e) such other matters, if any, as may be
expressly required by statute.
SECTION 2.03 Special Meetings. Special meetings of the
shareholders, for the purpose of taking any action permitted by
the shareholders under the State of Nevada, Domestic and Foreign
Corporation Laws and the articles of incorporation of the
corporation, may be called at any time by the Chairman of the
Board or the President, or by the Board of Directors, or by one
or more shareholders holding not less than ten percent of the
votes at the meeting. Upon request in writing that a special
meeting of shareholders be called for any proper purpose,
directed to the Chairman of the Board, President, Vice President
or Secretary by any person (other than the Board of Directors)
entitled to call a special meeting of the shareholders, the
officer forthwith shall cause notice to be given to shareholders
entitled to vote that a meeting will be held at a time requested
by the person or persons calling the meeting, not less than 35
nor more than 60 days after receipt of the request. Except in
special cases where other express provision is made by statute,
notice of such special meetings shall be given in the same manner
as for annual meetings of shareholders. In addition to the
matters required by items (a) and, if applicable, (c) of the
preceding Section, notice of any special meeting shall specify
the general nature of the business to be transacted, and no other
business may be transacted at such meeting.
SECTION 2.04 Quorum. The presence in person or by proxy
of the persons entitled to vote a majority of the voting shares
at any meeting shall constitute a quorum for the transaction of
business. The shareholders present at a duly called or held
meeting at which a quorum is present may continue to do business
until adjournment, notwithstanding the withdrawal of enough
shareholders to leave less than a quorum, if any action taken
(other than adjournment) is approved by at least a majority of
the shares required to constitute a quorum.
SECTION 2.05 Adjourned Meeting and Notice Thereof. Any
shareholders' meeting, annual or special, whether or not a quorum
is present, may be adjourned from time to time by the vote of a
majority of the shares, the holders of which are either present
in person or represented by proxy thereat, but in the absence of
a quorum no other business may be transacted at such meeting,
except as provided in Section 2.04 of this Article. When any
shareholders' meeting, either annual or special, is adjourned to
another time or place, notice need not be given of the adjourned
meeting if the time and place thereof are announced at the
meeting at which the adjournment is taken, unless after the
adjournment a new record date is fixed for the adjourned meeting
or unless the adjournment is for more than 45 days from the date
set for the original meeting, in which case the Board of
Directors shall set a new record date. Notice of any such
3
44
<PAGE>
adjourned meeting shall be given to each shareholder of record
entitled to vote at the adjourned meeting in accordance with the
provisions of Section 2.02 of this Article. At any adjourned
meeting the corporation may transact any business which might
have been transacted at the original meeting.
SECTION 2.06 Voting. Unless a record date for voting
purposes be fixed as provided in Section 5.01 of Article V of
these Bylaws then, subject to the provisions of Sections 78.355
of the State of Nevada, Domestic and Foreign Corporation Laws
(relating to voting of shares held by a fiduciary, in the name of
a corporation, or in joint ownership), only persons in whose
names shares entitled to vote stand on the stock records of the
corporation at the close of business on the business day next
preceding the day on which notice of the meeting is given or if
such notice is waived, at the close of business on the business
day next preceding the day on which the meeting of shareholders
is held, shall be entitled to vote at such meeting, and such day
shall be the record date for such meeting. Such vote may be by
voice or by ballot; provided, however, that all elections for
Directors must be by ballot upon demand made by a shareholder at
any election and before the voting begins. On any matter other
than election of Directors, any shareholder may vote part of his
shares in favor of the proposal and refrain from voting the
remaining shares or vote them against the proposal, but, if the
shareholder fails to specify the number of shares which the
shareholder is voting affirmatively, it will be conclusively
presumed that the shareholder's approving vote is with respect to
all shares such shareholder is entitled to vote. If a quorum is
present, except with respect to election of Directors, the
affirmative vote of the majority of the shares represented at the
meeting and entitled to vote on any matter shall be the act of
the shareholders, unless the vote of a greater number or voting
by classes is required by the State of Nevada, Domestic and
Foreign Corporation Laws or the articles of incorporation.
Subject to the requirements of the next sentence, every
shareholder entitled to vote at any election for Directors shall
have the right to cumulate his votes and give one candidate a
number of votes equal to the number of Directors to be elected
multiplied by the number of votes to which his shares are
entitled, or to distribute his votes on the same principle among
as many candidates as he shall think fit. No shareholder shall
be entitled to cumulate votes unless the name of the candidate or
candidates for whom such votes would be cast has been placed in
nomination prior to the voting and any shareholder has given
notice at the meeting prior to the voting of such shareholder's
intention to cumulate his votes. The candidate receiving the
highest number of votes of shares entitled to be voted for them,
up to the number of Directors to be elected, shall be elected.
SECTION 2.07. Validation of Defectively Called or Noticed
Meetings. The transactions of any meeting of shareholders,
4
45
<PAGE>
either annual or special, however called and noticed, shall be as
valid as though had at a meeting duly held after regular call and
notice, if a quorum be present either in person or by proxy, and
if, either before or after the meeting, each of the persons
entitled to vote, not present in person or by proxy, or who
though present, has at the beginning of the meeting, properly
objected to the transaction of any business because the meeting
was not lawfully called or convened, or to particular matters of
business legally required to be included in the notice, but not
so included, signs a written waiver of notice, or a consent to
the holding of such meeting, or an approval of the minutes
thereof. All such waivers, consents or approvals shall be filed
with the corporate records or made a part of the minutes of the
meeting. Neither the business to be transacted at nor the purpose
of any regular or special meeting of shareholders need be
specified in the written waiver of notice, consent to the holding
of the meeting, or approval of the Minutes thereof, unless
otherwise provided in the articles of incorporation, these
Bylaws, or by statute.
SECTION 2.08 Action Without Meeting. Directors may be
elected without a meeting by a consent in writing, setting forth
the action so taken, signed by all of the persons who would be
entitled to vote for the election of Directors, provided that,
without notice except as hereinafter set forth, a Director may be
elected at any time to fill a vacancy not filled by the Board of
Directors by the written consent of persons holding a majority of
the outstanding shares entitled to vote for the election of
Directors. Any other action which, under any provision of the
State of Nevada, Domestic and Foreign Corporation Laws, may be
taken at a meeting of the shareholders, may be taken without a
meeting, and without notice except as hereinafter set forth, if a
consent in writing, setting forth the action so taken, is signed
by the holders of outstanding shares having not less than the
minimum number of votes that would be necessary to authorize or
take such action at a meeting at which all shares entitled to
vote thereon were present and voted.
Unless the consents of all shareholders entitled to vote
have been solicited in writing:
(a) Notice of any proposed shareholder approval of, (i) a
contract or other transaction with an interested Director, (ii)
indemnification of an agent of the corporation as authorized by
Section 5.08 of Article V of these Bylaws, (iii) a reorganization
of the corporation as defined in Section 181 of the State of
Nevada, Domestic and Foreign Corporation Laws, or (iv) a
distribution in dissolution other than in accordance with the
rights of outstanding preferred shares, if any, without a meeting
by less than unanimous written consent, shall be given at least
ten days before the consummation of the action authorized by such
approval; and
5
46
<PAGE>
(b) Prompt notice shall be given of the taking of any other
corporate action approved by shareholders without a meeting by
less than unanimous written consent, to those shareholders
entitled to vote who have not consented in writing. Such notice
shall be given in the manner and shall be deemed to have been
given as provided in Section 2.02 of Article II of these Bylaws.
Unless, as provided in Section 5.01 of Article V of these
Bylaws, the Board of Directors has fixed a record date for the
determination of shareholders entitled to give such written
consent, the record date for such determination shall be the day
on which the first written consent is given, when no prior action
by the Board of Directors has been taken. In all other cases in
which the Board of Directors has not fixed a record date for the
determination of shareholders entitled to give such written
consent as provided in Section 5.01 of Article V of these Bylaws,
the record date shall be determined as set forth in such Section
5.01.
Any shareholder giving a written consent, or the
shareholder's proxy holders, or a transferee of the shares or a
personal representative of the shareholder or their respective
proxyholders, may revoke the consent by a writing received by the
corporation prior to the time that written consents of the number
of shares required to authorize the proposed action have been
filed with the Secretary of the corporation, but may not do so
thereafter. Such revocation is effective upon its receipt by the
Secretary of the corporation. All written consents referred to
in this Section 2.08 shall be filed with the Secretary of the
corporation and shall be maintained in the corporate records.
SECTION 2.09 Proxies. Every person entitled to vote or
execute consents shall have the right to do so either in person
or by one or more agents authorized by a written proxy executed
by such person or his duly authorized agent and filed with the
Secretary of the corporation. Any proxy duly executed is not
revoked and continues in full force and effect until (i) an
instrument revoking it or a duly executed proxy bearing a later
date is filed with the Secretary of the corporation prior to the
vote pursuant thereto, (ii) the person executing the proxy
attends the meeting and votes in person or (iii) written notice
of the death or incapacity of the maker of such proxy is received
by the corporation before the vote pursuant thereto is counted;
provided that no such proxy shall be valid after the expiration
of 11 months from the date of its execution, unless the person
executing it specifies therein the length of time for which such
proxy is to continue in force.
SECTION 2.10 Inspectors of Election. In advance of any
meeting of shareholders, the Board of Directors may appoint any
persons other than nominees for office as inspectors of election
6
47
<PAGE>
to act at such meeting or any adjournment thereof. If inspectors
of election be not so appointed, the Chairman of any such may,
and on the request of any shareholder or his proxy shall, make
such appointment at the meeting. The number of inspectors shall
be either one or three. If appointed at a meeting on the request
of one or more shareholders or proxies, the majority of shares
represented in person or by proxy shall determine whether one or
three inspectors is to be appointed. In case any person appointed
as inspector fails to appear or refuses to act, the vacancy may,
and on the request of any shareholder or a shareholder's proxy
shall, be filled by appointment by the Board of Directors in
advance of the meeting, or at the meeting by the Chairman of the
meeting.
The duties of such inspectors shall include: determining the
number of shareholders and the voting power of each; the shares
represented at the meeting; the existence of a quorum; the
authenticity, validity and effect of proxies; receiving votes,
ballots or consents; hearing and determining all challenges and
questions in any way arising in connection with the right to
vote; counting and tabulating all votes or consents; determining
when the polls shall close; determining the result; and such acts
as may be proper to conduct the election or vote with fairness to
all shareholders. In the determination of the validity and
effect of proxies the dates contained on the forms of proxy shall
presumptively determine the order of execution of the proxies,
regardless of the postmark dates on the envelopes in which they
are mailed.
The inspectors of election shall perform their duties
impartially, in good faith, to the best of their ability and as
expeditiously as is practical. If there are three inspectors of
election, the decision, act or certificate of a majority is
effective in all respects as the decision, act, or certificate of
all. Any report or certificate made by inspectors of election is
prima facie evidence of the facts stated therein.
ARTICLE III
Directors
SECTION 3.01. Powers. Subject to limitations of the
articles of incorporation and of the State of Nevada, Domestic
and Foreign Corporation Laws as to action to be authorized or
approved by the shareholders, and subject to the duties of
Directors as prescribed by these Bylaws, all corporate powers
shall be exercised by or under the authority of, and the business
and affairs of the corporation shall be controlled by, the Board
of Directors. Without prejudice to such general powers, but
subject to the same limitations, it is hereby expressly declared
that the Directors shall have the following powers:
7
48
<PAGE>
First - To select and remove all the officers, agents and
employees of the corporation, prescribe such powers and duties
for them as may not be inconsistent with law, with the articles
of incorporation or these Bylaws, fix compensation and require
from them security for faithful service.
Second - To conduct, manage and control the affairs and
business of the corporation, and to make such rules and
regulations therefor not inconsistent with law, or with the
articles of incorporation or these Bylaws, as they may deem best.
Third - To change the principal executive office and
principal office for the transaction of the business of the
corporation from one location to another as provided in Article
I, Section 1.01 of these Bylaws; to fix and locate from time to
time one or more subsidiary offices of the corporation within or
without the State of Nevada, as provided in Article I, Section
1.02 of these Bylaws; to designate any place within or without
the State of Nevada for the holding of any shareholders' meeting
or meetings; and to adopt, make and use a corporate seal, and to
prescribe the forms of certificates of stock, and to alter the
form of such seal and of such certificates from time as in their
judgment they may deem best, provided such seal and such
certificates shall at all times comply with the provisions of
law.
Fourth - To authorize the issuance of shares of stock of
the corporation from time to time upon such terms as may be
lawful.
Fifth - To borrow money and incur indebtedness for the
purposes of the corporation, and to cause to be executed and
delivered therefor, in the corporate name, promissory notes,
bonds, debentures, deeds of trust, mortgages, pledges,
hypothecations or other evidences of debt and securities
therefor.
Sixth - By resolution adopted by a majority of the
authorized number of Directors, to designate an executive and
other committees, each consisting of two or more Directors to
serve at the pleasure of the Board, and to prescribe the manner
in which proceedings of such committee shall conducted. Unless
the Board of Directors shall otherwise prescribe the manner of
proceedings of any such committee, meetings of such committee may
be regularly scheduled in advance and may be called at any time
by any two members thereof; otherwise, the provisions of these
Bylaws with respect to notice and conduct of meetings of the
Board shall govern. The committees shall keep regular minutes of
their proceedings and report the same to the Board when required.
Any such committee, to the extent provided in a resolution of the
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Board, shall have all the authority of the Board, except with
respect to:
(i) the approval of any action for which the
Nevada General Corporation Law or the articles of incorporation
also require shareholder approval;
(ii) the filling of vacancies on the Board or in
any committee;
(iii) the fixing of compensation of the Directors
for serving on the Board or on any committee;
(iv) the adoption, amendment or repeal of Bylaws;
(v) the amendment or repeal of any resolution of
the Board;
(vi) any distribution to the shareholders, except
at a rate or in a periodic amount or within a price range
determined by the Board; and
(vii) the appointment of other committees of the
Board or the members thereof.
SECTION 3.02 Number and Qualification of Directors. The
authorized number of directors shall be three (3) until changed
by a duly adopted amendment to the articles of incorporation or
by an amendment to this Section 3.02 duly adopted by a vote or
written consent of holders of a majority of the outstanding share
entitled to vote; provided, however, that if the number of
Directors should ever be increased to five or more, an amendment
to this Section 3.02 or an amendment to the articles of
incorporation, either of which would reduce the fixed number of
Directors to a number less than five, cannot be adopted if the
votes cast against its adoption at a meeting, or the shares not
consenting in the case of action by written consent, are equal to
more than 16 2/3 percent of the outstanding shares entitled to
vote.
SECTION 3.03 Election and Term of Office. The Directors
shall be elected at each annual meeting of shareholders but, if
any such annual meeting is not held or the Directors are not
elected thereat, the Directors may be elected at any special
meeting of shareholders held for that purpose. All Directors
shall hold office until the next annual shareholders' meeting and
until their respective successors are elected and qualified,
subject to the State of Nevada, Domestic and Foreign Corporation
Laws and the provisions of these Bylaws with respect to vacancies
on the Board.
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SECTION 3.04 Vacancies. A vacancy in the Board of
Directors shall be deemed to exist in case of the death,
resignation, disqualification or removal of any Director; if a
Director has been declared of unsound mind by order of a court or
convicted of a felony; if the authorized number of Directors is
increased; or if the shareholders fail, at any annual or special
meeting of shareholders at which any Directors are elected, to
elect the full authorized number of Directors to be voted for at
that meeting.
Vacancies in the Board of Directors, except for a vacancy
created by the removal of a Director, may be filled by a majority
of the remaining Directors, though less than a quorum, or by a
sole remaining Director, and each director so elected shall hold
office until his successor is elected at an annual or a special
meeting of the shareholders. A vacancy in the Board of Directors
created by the removal of a Director may only be filled by the
vote of a majority of the shares entitled to vote represented at
a duly held meeting at which a quorum is present, or by the
written consent of the holders of a majority of the outstanding
shares.
The shareholders may elect a Director or Directors at any
time to fill any vacancy or vacancies not filled by the remaining
Directors. Any such election by written consent shall require
the consent of holders of a majority of the outstanding shares
entitled to vote.
Any Director may resign effective upon giving written notice
to the Chairman of the Board, the President, the Secretary or the
Board of Directors of the corporation, unless the notice
specifies a later time for the effectiveness of resignation. If
the Board of Director accepts the resignation of a Director
tendered to take effect at a future time, the Board or the
shareholders shall have power to elect a successor to take office
when the resignation is to become effective.
No reduction of the authorized number of Directors shall
have the effect of removing any Director prior to the expiration
of his term of office.
SECTION 3.05 Place of Meeting. Regular meetings of the
Board of Directors shall be held at any place within or without
the State of Nevada which has been designated from time to time
by resolution of the Board or by written consent of all members
of the Board. In the absence of such designation regular
meetings shall be held at the principal executive office of the
corporation. Special meetings of the Board may be held either at
a place so designated or at the principal executive office. Any
meeting, regular or special, may be held by conference telephone
or similar communications equipment as long as all Directors
participating in the meeting can hear one another, and all such
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Directors shall be deemed to be present in person at the meeting.
SECTION 3.06 Organization Meeting. Immediately following
each annual meeting of shareholders the Board of Directors shall
hold a regular meeting at the place of said annual meeting or at
such other place as shall be fixed by the Board of Directors, for
the purpose of organization, election of officers, and the
transaction of other business. Call and notice of such meetings
are hereby dispensed with.
SECTION 3.07 Other Regular Meetings. Other regular
meetings of the Board of Directors and provision for notice
thereof may be provided for by amendment of these Bylaws pursuant
to Article VI below.
SECTION 3.08 Special Meetings. Special meetings of the
Board of Directors for any purpose or purposes may be called at
any time by the Chairman of the Board, the President, any Vice
President, the Secretary or by any two Directors.
Written notice of the time and place of special meetings
shall be delivered personally to each Director or communicated to
each Director by telephone, or by telegraph or mail prepaid,
addressed to him or her at his or her address as it is shown upon
the records of the corporation or, if it is not so shown on such
records or is not readily ascertainable, at the place at which
the meetings of the Directors are regularly held. In case such
notice is mailed, it shall be deposited in the United States mail
in the place in which the principal executive office of the
corporation is located at least four days before the time of the
holding of meeting. In case the notice is delivered personally,
or by telephone or telegram, it shall be delivered personally, or
by telephone or to the telegraph company, at least 48 hours
before the time of the holding of the meeting. Any oral notice
given personally or by telephone may be communicated either to
the Director or a person at the office or residence of the
Director whom the person giving the notice has reason to believe
will promptly communicate it to the Director. Such mailing,
telegraphing or delivery, personally or by telephone, as above
provided, shall constitute due, legal and personal notice to such
Director.
Any notice shall state the date, place, and hour of the
meeting. However, the notice need not specify the purpose of the
meeting.
SECTION 3.09 Action Without Meeting. Any action by the
Board of Directors may be taken without a meeting if all members
of the Board shall individually or collectively consent in
writing to such action. Such written consent or consents shall
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be filed with the minutes proceedings of the Board and shall have
the same force and effect as a unanimous vote of such Directors.
SECTION 3.10 Action at a Meeting: Quorum and Required
Vote. Presence of a majority of the authorized number of
Directors at a meeting of the Board of Directors constitutes a
quorum for the transaction of business, except as hereinafter
provided. Members of the Board may participate in a meeting
through use of conference telephone or similar communications
equipment, so long as all members participating in such meeting
can hear one another. Participation in a meeting as permitted in
the preceding sentence constitutes presence in person at such
meeting. Every act or decision done or made by a majority of the
Directors present at a meeting duly held at which a quorum is
present shall be regarded as the act of the Board of Directors,
unless a greater number, or the same number after disqualifying
one or more Directors from voting, is required by law, by the
articles of incorporation or by these Bylaws. A meeting at which
a quorum is initially present may continue to transact business
notwithstanding the withdrawal of a Director, provided that any
action taken is approved by at least a majority of the required
quorum for such meeting.
SECTION 3.11 Validation of Defectively Called or Noticed
Meetings. The transactions of any meeting of the Board of
Directors, however called and noticed or wherever held, shall be
as valid as though had at a meeting duly held after regular call
and notice, if a quorum is present and if, either before or after
the meeting, each of the Directors not present or who, though
present, has prior to the meeting or at its commencement,
protested the lack of proper notice to him, signs a written
waiver of notice or a consent to holding such meeting or an
approval of the minutes thereof. All such waivers, consents or
approvals shall be filed with the corporate records or made a
part of the minutes of the meeting. The waiver of notice or
consent need not specify the purpose of the meeting.
SECTION 3.12 Adjournment. A majority of the Directors
present, whether or not a quorum is present, may adjourn any
meeting to another time and place.
SECTION 3.13 Notice of Adjournment. If the meeting is
adjourned for more than 24 hours, notice of any adjournment to
another time or place shall be given prior to the time of the
adjourned meeting to the Directors who were not present at the
time of adjournment. Otherwise, notice of the time and place of
holding an adjourned meeting need not be given to absent
directors if the time and place be fixed at the meeting
adjourned.
SECTION 3.14 Fees and Compensation. Directors and members
of committees may receive such compensation, if any,
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for their services, and such reimbursement for expenses, as may
be fixed or determined by resolution of the Board.
ARTICLE IV
Officers
SECTION 4.01 Officers. The officers of the corporation
shall be a President, a Secretary and a Chief Financial Officer
(Treasurer). The corporation may also have, at the discretion of
the Board of Directors, a Chairman of the Board, one or more Vice
Presidents, one or more Assistant Secretaries, one or more
Assistant Treasurers, and such other officers as may be appointed
in accordance with the provisions of Section 4.02 of this
Article.
SECTION 4.02 Election. The officers of the corporation,
except such officers as may be appointed in accordance with the
provisions of Section 4.03 or Section 4.05 of this Article, shall
be chosen annually by the Board of Directors, and each shall hold
his or her office until he or she shall resign or shall be
removed or otherwise disqualified to serve, or his or her
successor shall be elected and qualified.
SECTION 4.03 Subordinate Officers, Etc. The Board of
Directors may appoint, and may empower the President to appoint
such other officers as the business of the corporation may
require, each of whom shall hold office for such period, have
such authority, and perform such duties as are provided in these
Bylaws or as the Board of Directors may from time to time
determine.
SECTION 4.04 Removal & Resignation. Any officer may be
removed, either with or without cause, by the Board of Directors
at any regular or special meeting thereof, or, except in case of
an officer chosen by the Board of Directors, by any officer upon
whom such power of removal may be conferred by the Board of
Directors (subject, in each case, to the rights, if any, of an
officer under any contract of employment).
Any officer may resign at any time by giving written notice
to the Board of Directors or to the President, or to the
Secretary of the corporation, without prejudice, however, to the
rights, if any, of the corporation under any contract to which
such officer is a party. Any such resignation shall take effect
at the date of the receipt of such notice or at any later time
specified therein; and, unless otherwise specified therein, the
acceptance of such resignation shall not be necessary to make it
effective.
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SECTION 4.05 Vacancies. A vacancy in any office because
of death, resignation, removal, disqualification or any other
cause shall be filled in the manner prescribed in these Bylaws
for regular appointments to such office.
SECTION 4.06 Chairman of the Board. The Chairman of the
Board, if there shall be such an officer, shall, if present,
preside at all meetings of the Board of Directors and exercise
and perform such other powers and duties as may be from time to
time assigned to him or her by the Board of Directors or
prescribed by these Bylaws.
SECTION 4.07 President. Subject to such supervisory
powers, if any, as may be given by the Board of Directors to the
Chairman of the Board, if there be such an officer, the President
shall be Executive Officer of the corporation and shall, subject
to the control of the Board of Directors, have general
supervision, direction and control of the business and officers
of the corporation. He or she shall preside at all meetings of
the shareholders and, in the absence of the Chairman of the
Board, or if there be none, at all meetings of the Board of
Directors. He or she shall be ex officio a member of all the
standing committees, including the executive committee, if any,
and shall have the general power and duties of management usually
vested in the office of the President of a corporation, and shall
have such powers and duties as may be prescribed by the Board of
Directors or these Bylaws.
SECTION 4.08 Vice President. In the absence or disability
of the President, the Vice Presidents in order of their rank as
fixed by the Board of Directors or, if not ranked, the Vice
President designated by the Board of Directors, shall perform all
the duties of President, and when so acting shall have all the
powers of, and be subject to all restrictions upon, the
President. The Vice Presidents shall have such other powers and
perform such other duties as from time to time may be prescribed
for them respectively by the Board of Directors or these Bylaws.
SECTION 4.09 Secretary. The Secretary shall record or
cause to be recorded, and shall keep or cause to be kept, at the
principal executive office and such other place as the Board of
Directors may order, a book of minutes of actions taken at all
meetings of Directors and shareholders, with the time and place
of holding, whether regular or special, and, if special, how
authorized, the notice thereof given, the names of those present
at Directors' meetings, the number of shares present or
represented at shareholders' meetings, and the proceedings
thereof.
The Secretary shall keep, or cause to be kept, at the
principal executive office or at the office of the corporation's
transfer agent, a share register, or a duplicate share register,
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showing the names of the shareholders and their addresses, the
number and classes of shares held by each, the number and date of
certificates issued for the same, and the number and date of
cancellation of every certificate surrendered for cancellation.
The Secretary shall give, or cause to be given, notice of
all meetings of the shareholders and of the Board of Directors
required by these Bylaws or by law to be given, shall keep the
seal of the corporation in safe custody, and shall have such
other powers and perform such other duties as may be prescribed
by the Board of Directors or by these Bylaws.
SECTION 4.10 Chief Financial Officer. The Chief Financial
Officer of the corporation shall keep and or cause to be kept and
maintained, adequate and correct accounts of the properties and
business transactions of the corporation, including accounts of
its assets, liabilities, disbursements, gains, losses, capital,
surplus and shares. Any surplus, including earned surplus,
paid-in surplus and surplus arising from a reduction of stated ,
shall be classified according to source and shown in a separate
account. The Chief Financial Officer shall deposit all moneys
and other valuables in the name and to the credit of the
corporation with such depositories as may be designated by the
Board of Directors. He shall disburse the funds of the
corporation as may be ordered by the Board of Directors, shall
render to the President and Directors, whenever they request it
an account of all of his transactions as Chief Financial Officer
and of the financial condition of the corporation, and shall have
such other powers and perform such other duties as may be
prescribed by the Board of Directors or these Bylaws. The Chief
Financial Officer of the corporation is, for purposes of giving
any reports or executing any certificates or other documents
requiring the signature of the "Treasurer" deemed to be also the
Treasurer of the corporation.
ARTICLE V
Miscellaneous
SECTION 5.01 Record Date. The Board of Directors may fix
a time in the future as a record date for the determination
of the shareholders entitled to notice of and to vote at any
meeting of shareholders or entitled to give consent to corporate
action in writing without a meeting, to receive any report, to
receive any dividend or distribution, or any allotment of rights,
or to exercise rights in respect to any change, conversion, or
exchange of shares. The record date fixed shall be not more than
60 days nor less than ten days prior to the date of any meeting,
nor more than 60 days prior to any other event for the purposes
for which it is fixed. When a record date is so fixed, only
shareholders of record on that date are entitled to notice of and
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to vote at any such meeting, to give consent without a meeting,
to receive any report, to receive a dividend, distribution, or
allotment of rights, or to exercise the rights, as the case may
be, notwithstanding any transfer of any shares on the books of
the corporation after the record date, except as otherwise
provided in the articles of incorporation or the bylaws.
If no record date is fixed:
(a) the record date for determining shareholders entitled
to notice of or to vote at a meeting of shareholders shall be at
the close of business on the business day preceding the day on
which the Board of Directors adopts the resolution relating
thereto, or the 60th day prior to the date of such other action,
whichever is later.
SECTION 5.02 Inspection of Corporate Records. The
accounting books and records, the record of shareholders, and
minutes of proceedings of the shareholders and the Board and
committees of the corporation and any subsidiary of the
corporation shall be open to inspection upon the written demand
on the corporation of any shareholder or holder of a voting trust
certificate at any reasonable time during usual business hours,
for a purpose reasonably related to such holder's interests as a
shareholder or as the holder of such voting trust certificate.
Such inspection by a shareholder or holder of a voting trust
certificate may be made in person or by agent or attorney, and
the right of inspection includes the right to copy and make
extracts.
A shareholder or shareholders holding at least five percent
in the aggregate of the outstanding voting shares of the
corporation or who hold at least one percent of such voting
shares and have filed a Schedule 14B with the United States
Securities and Exchange Commission relating to the election of
Directors of the corporation shall have (in person, or by agent
or attorney) the right to inspect and copy the record of
shareholders' names and addresses and shareholdings during usual
business hours upon five business days' prior written demand upon
the corporation and to obtain from the transfer agent for the
corporation, upon written demand and upon the tender of its usual
charges, a list of the shareholders' names and addresses, who are
entitled to vote for the election of Directors, and their
shareholdings, as of the most recent record date for which it has
been compiled or as of a date specified by the shareholder
subsequent to the date of demand. The list shall be made
available on or before the later of five business days after the
demand is received or the date specified therein as the date as
of which the list is to be compiled.
Every Director shall have the absolute right at any
reasonable time to inspect and copy all books, records and
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documents of every kind and to inspect the physical properties of
the corporation and each of its subsidiary corporations. Such
inspection by a Director may be made in person or by agent or
attorney and the right of inspection includes the right to copy
and make extracts.
SECTION 5.03 Checks, Drafts, Etc. All checks, drafts or
other orders for payment of notes or other evidences of
indebtedness, issued in the name of or payable to the
corporation, shall be signed or endorsed by such person or
persons and in such manner as, from time to time, shall be
determined by resolution of the Board of Directors.
SECTION 5.04 Annual and Other Reports. The annual report
to shareholders referred to in the Domestic and Foreign
Corporation Law of the State of Nevada, but nothing herein shall
be interpreted as prohibiting the Board from issuing annual or
other periodic reports to shareholders.
SECTION 5.05 Contracts, Etc., How Executed. The Board Of
Directors, except as in these Bylaws otherwise provided, may
authorize any officer or officers, agent or agents, to enter into
any contract or execute any instrument in the name of and on
behalf of the corporation, and such authority may be general or
confined to specific instances; and, unless so authorized by the
Board of Directors, no officer, agent or employee shall have any
power or authority to bind the corporation by any contract or
engagement or to pledge its credit or to render it liable for any
purpose or to any amount.
SECTION 5.06 Certificate for Shares. Every holder of
shares in the corporation shall be entitled to have a certificate
signed in the name of the corporation by the Chairman or Vice
Chairman of the Board or the President or a Vice President and by
the Chief Financial officer or an Assistant Treasurer or the
Secretary or any Assistant Secretary, certifying the number of
shares and the class or series of shares owned by the
shareholder. Any of the signatures on the certificate may be
facsimile, provided that in such event at least one signature,
including that of either an officer or the corporation's
registrar or transfer agent, if any, shall be manually signed.
In case any officer, transfer agent or registrar who has signed
or whose facsimile signature has been placed upon a 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 such person were an
officer, transfer agent or registrar at the date of issue.
Any such certificate shall also contain such legend or other
statement as provided for in Section 5.0l and 5.02 of this
Article, or as may be required by the State of Nevada, Domestic
and Foreign Corporation Laws, the federal securities laws, or any
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agreement between the corporation and the issue of such
certificate.
Certificates for shares may be issued prior to full payment
under such restrictions and for such purposes as the Board of
Directors or the Bylaws may provide; provided, however, that any
such certificate so issued prior to full payment shall state on
the face thereof the amount remaining and the terms of payment
thereof.
No new certificates for shares shall be issued in lieu of an
old certificate unless the latter is surrendered and canceled at
the same time; provided, however a new certificate will be issued
without the surrender and cancellation of the old certificate if
(1) the old certificate is lost, apparently destroyed or
wrongfully taken; (2) the request for the issuance of the new
certificate is made within a reasonable time after the owner of
the old certificate has notice of its loss, destruction, or
theft; (3) the request for the issuance of a new certificate is
made prior to the receipt of notice by the corporation that the
old certificate has been acquired by a bona fide purchaser; (4)
the owner of the old certificate files a sufficient indemnity
bond with or provides other adequate security to the corporation;
and (5) the owner satisfies any other reasonable requirements
imposed by the corporation. In the event of the issuance of a
new certificate, the rights and liabilities of the corporation,
and of the holders of old and new certificates, shall be governed
by the provisions of Sections 8104 and 8405 of the Nevada Uniform
Commercial Code.
SECTION 5.07 Representation of Shares of Other
Corporations. The President or any Vice President and the
Secretary or any Assistant Secretary of the corporation are
authorized to vote, represent and exercise on behalf of the
corporation all rights incident to any and all shares of any
other corporation or corporations standing in the name of the
corporation. The authority herein granted to said officers to
vote or represent on behalf of the corporation any and all shares
held by the corporation in any other corporation or corporations
may be exercised either by such officers in person or by any
other person or by any other person authorized to do so by proxy
or power of attorney duly executed by said officers.
SECTION 5.08 Indemnification of Directors, Officers,
Employees and Other Agents. The corporation shall, to the
maximum extent permitted by the State of Nevada, Domestic and
Foreign Corporation Laws, indemnify each of its agents against
expenses, judgments, fines, settlements and other amounts
actually and reasonably incurred in connection with any
proceeding arising by reason of the fact any such person is or
was an agent of the corporation. For purposes of this Section,
an "agent" of the corporation includes any person who is or was a
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director, officer, employee, or other agent of the corporation,
or is or was serving at the request of the corporation a
director, officer, employee, or agent of another or domestic
corporation, partnership, joint venture, other enterprise, or was
a Director, officer, employee, or agent of a foreign or domestic
corporation which was a predecessor corporation of the
corporation or of another enterprise at the request of such
predecessor corporation; "proceeding" means any threatened,
pending or completed action or proceeding, whether civil,
criminal, administrative, or investigative; and "expenses"s,
includes, without limitation, attorneys' fees and any expenses of
establishing a right to indemnification from the corporation.
SECTION 5.09 Inspection of Bylaws. The corporation shall
keep in its principal executive office in Nevada, or if its
principal executive office is not in Nevada, then at its
principal business office in Nevada (or otherwise provide upon
written request of any shareholder) the original or a copy of the
Bylaws as amended or otherwise altered to date, certified by the
Secretary, which shall be open to inspection by the shareholders
at all reasonable times during office hours. If the principal
executive office of the corporation is outside Nevada and the
corporation has no principal business office in Nevada, the
Secretary shall, upon the written request of any shareholder,
furnish to that shareholder a copy of the Bylaws as amended to
date.
SECTION 5.10 Construction and Definitions. Unless the
context otherwise requires, the general provisions, rules of
construction and definitions contained in the State of Nevada,
Domestic and Foreign Corporation Laws shall govern the
construction of these Bylaws. Without limiting the generality of
the foregoing, the masculine gender includes the feminine and
neuter, the singular number includes the plural and the plural
number includes the singular, and the term "person" includes a
corporation as well as a natural person.
ARTICLE VI
Amendments
SECTION 6.01 Power of Shareholders. New Bylaws may be
adopted or these Bylaws may be amended or repealed by the
affirmative vote or written consent of holders of a majority of
the outstanding shares entitled to vote; provided, however, that
if the articles of incorporation set forth the number of
authorized Directors of the corporation, the authorized number of
Directors may be changed only by an amendment of the articles of
incorporation.
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SECTION 6.02 Power of Directors. Subject to the right of
shareholders as provided in Section 6.01 of this Article to
adopt, amend or repeal Bylaws, Bylaws, other than a Bylaw or
amendment thereof changing the authorized number of Directors,
may be adopted, amended or repeal Board of Directors.
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CERTIFICATE OF SECRETARY
I, the undersigned, do hereby certify:
1. That I am the duly elected and acting Secretary of
N. T. Properties, Inc., a Nevada corporation;
2. That the foregoing Bylaws, consisting of 20 pages, are
a true and correct copy of the duly adopted Bylaws of said
corporation.
IN WITNESS WHEREOF, I have hereunto subscribed my name and
affixed the seal of said corporation this 22nd day of September,
1982.
s/Cleora Louey
_______________________________
Cleora Louey, Secretary
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N.T. PROPERTIES, INC.
____________________________
EXHIBIT 4.1
____________________________
FORM OF
SHAREHOLDER LOCK-UP LETTER
____________________________
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December 31, 1998
Board of Directors
N. T. Properties, Inc.
6 Venture, Ste. 207
Irvine, California 92618
Gentlemen:
The undersigned, a beneficial owner of the common stock of
N. T. Properties, Inc. (the "Company"), $0.001 par value per
share (the "Common Stock"), understands that the Company has
filed with the U.S. Securities and Exchange Commission a
registration statement on Form 10-SB (the "Registration
Statement"), for the registration of the Company's Common Stock.
As part of the disclosure included in the Registration Statement,
the Company has affirmatively represented that there will be no
trading of the Company's securities until such time as the
Company successfully implements its business plan as described in
such Registration Statement, consummating a merger or
acquisition.
In order to insure that the aforesaid disclosure is adhered
to, the undersigned agrees, for the benefit of the Company, that
he/she will not offer to sell, assign, pledge, hypothecate, grant
any option for the sale of, or otherwise dispose of, directly or
indirectly, any shares of the Common Stock owned by him/her, or
subsequently acquired through the exercise of any options,
warrants or rights, or conversion of any other security, or by
reason of any stock split or other distribution of stock, or
grant options, rights or warrants with respect to any such shares
of Common Stock, until the Company until the Company successfully
closes a merger or acquisition. Furthermore, the undersigned
will permit all certificates evidencing his/her shares to be
endorsed with the appropriate restrictive legends and will
consent to the placement of appropriate stop transfer orders with
the transfer agent of the Company.
Very truly yours,
s/Brad A. Hibbard
______________________________
(signature of holder)
Brad A. Hibbard
Please Print Name
125,000
- -------
Number of shares of Common
Stock owned
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<PAGE>
December 31, 1998
Board of Directors
N. T. Properties, Inc.
6 Venture, Ste. 207
Irvine, California 92618
Gentlemen:
The undersigned, a beneficial owner of the common stock of
N. T. Properties, Inc. (the "Company"), $0.001 par value per
share (the "Common Stock"), understands that the Company has
filed with the U.S. Securities and Exchange Commission a
registration statement on Form 10-SB (the "Registration
Statement"), for the registration of the Company's Common Stock.
As part of the disclosure included in the Registration Statement,
the Company has affirmatively represented that there will be no
trading of the Company's securities until such time as the
Company successfully implements its business plan as described in
such Registration Statement, consummating a merger or
acquisition.
In order to insure that the aforesaid disclosure is adhered
to, the undersigned agrees, for the benefit of the Company, that
he/she will not offer to sell, assign, pledge, hypothecate, grant
any option for the sale of, or otherwise dispose of, directly or
indirectly, any shares of the Common Stock owned by him/her, or
subsequently acquired through the exercise of any options,
warrants or rights, or conversion of any other security, or by
reason of any stock split or other distribution of stock, or
grant options, rights or warrants with respect to any such shares
of Common Stock, until the Company until the Company successfully
closes a merger or acquisition. Furthermore, the undersigned
will permit all certificates evidencing his/her shares to be
endorsed with the appropriate restrictive legends and will
consent to the placement of appropriate stop transfer orders with
the transfer agent of the Company.
Very truly yours,
s/Cleora Louey
______________________________
(signature of holder)
Cleora Louey
Please Print Name
100,000
- -------
Number of shares of Common
Stock owned
65
<PAGE>
December 31, 1998
Board of Directors
N. T. Properties, Inc.
6 Venture, Ste. 207
Irvine, California 92618
Gentlemen:
The undersigned, a beneficial owner of the common stock of
N. T. Properties, Inc. (the "Company"), $0.001 par value per
share (the "Common Stock"), understands that the Company has
filed with the U.S. Securities and Exchange Commission a
registration statement on Form 10-SB (the "Registration
Statement"), for the registration of the Company's Common Stock.
As part of the disclosure included in the Registration Statement,
the Company has affirmatively represented that there will be no
trading of the Company's securities until such time as the
Company successfully implements its business plan as described in
such Registration Statement, consummating a merger or
acquisition.
In order to insure that the aforesaid disclosure is adhered
to, the undersigned agrees, for the benefit of the Company, that
he/she will not offer to sell, assign, pledge, hypothecate, grant
any option for the sale of, or otherwise dispose of, directly or
indirectly, any shares of the Common Stock owned by him/her, or
subsequently acquired through the exercise of any options,
warrants or rights, or conversion of any other security, or by
reason of any stock split or other distribution of stock, or
grant options, rights or warrants with respect to any such shares
of Common Stock, until the Company until the Company successfully
closes a merger or acquisition. Furthermore, the undersigned
will permit all certificates evidencing his/her shares to be
endorsed with the appropriate restrictive legends and will
consent to the placement of appropriate stop transfer orders with
the transfer agent of the Company.
Very truly yours,
s/Douglas P. Morrison
______________________________
(signature of holder)
Douglas P. Morrison
Please Print Name
100,000
- -------
Number of shares of Common
Stock owned
66
<PAGE>
December 31, 1998
Board of Directors
N. T. Properties, Inc.
6 Venture, Ste. 207
Irvine, California 92618
Gentlemen:
The undersigned, a beneficial owner of the common stock of
N. T. Properties, Inc. (the "Company"), $0.001 par value per
share (the "Common Stock"), understands that the Company has
filed with the U.S. Securities and Exchange Commission a
registration statement on Form 10-SB (the "Registration
Statement"), for the registration of the Company's Common Stock.
As part of the disclosure included in the Registration Statement,
the Company has affirmatively represented that there will be no
trading of the Company's securities until such time as the
Company successfully implements its business plan as described in
such Registration Statement, consummating a merger or
acquisition.
In order to insure that the aforesaid disclosure is adhered
to, the undersigned agrees, for the benefit of the Company, that
he/she will not offer to sell, assign, pledge, hypothecate, grant
any option for the sale of, or otherwise dispose of, directly or
indirectly, any shares of the Common Stock owned by him/her, or
subsequently acquired through the exercise of any options,
warrants or rights, or conversion of any other security, or by
reason of any stock split or other distribution of stock, or
grant options, rights or warrants with respect to any such shares
of Common Stock, until the Company until the Company successfully
closes a merger or acquisition. Furthermore, the undersigned
will permit all certificates evidencing his/her shares to be
endorsed with the appropriate restrictive legends and will
consent to the placement of appropriate stop transfer orders with
the transfer agent of the Company.
Very truly yours,
s/Bryan Gianesin
______________________________
(signature of holder)
Bryan Gianesin
Please Print Name
25,000
- ------
Number of shares of Common
Stock owned
67
<PAGE>
December 31, 1998
Board of Directors
N. T. Properties, Inc.
6 Venture, Ste. 207
Irvine, California 92618
Gentlemen:
The undersigned, a beneficial owner of the common stock of
N. T. Properties, Inc. (the "Company"), $0.001 par value per
share (the "Common Stock"), understands that the Company has
filed with the U.S. Securities and Exchange Commission a
registration statement on Form 10-SB (the "Registration
Statement"), for the registration of the Company's Common Stock.
As part of the disclosure included in the Registration Statement,
the Company has affirmatively represented that there will be no
trading of the Company's securities until such time as the
Company successfully implements its business plan as described in
such Registration Statement, consummating a merger or
acquisition.
In order to insure that the aforesaid disclosure is adhered
to, the undersigned agrees, for the benefit of the Company, that
he/she will not offer to sell, assign, pledge, hypothecate, grant
any option for the sale of, or otherwise dispose of, directly or
indirectly, any shares of the Common Stock owned by him/her, or
subsequently acquired through the exercise of any options,
warrants or rights, or conversion of any other security, or by
reason of any stock split or other distribution of stock, or
grant options, rights or warrants with respect to any such shares
of Common Stock, until the Company until the Company successfully
closes a merger or acquisition. Furthermore, the undersigned
will permit all certificates evidencing his/her shares to be
endorsed with the appropriate restrictive legends and will
consent to the placement of appropriate stop transfer orders with
the transfer agent of the Company.
Very truly yours,
s/George Unwin
______________________________
(signature of holder)
George Unwin
Please Print Name
25,000
- ------
Number of shares of Common
Stock owned
68
<PAGE>
December 31, 1998
Board of Directors
N. T. Properties, Inc.
6 Venture, Ste. 207
Irvine, California 92618
Gentlemen:
The undersigned, a beneficial owner of the common stock of
N. T. Properties, Inc. (the "Company"), $0.001 par value per
share (the "Common Stock"), understands that the Company has
filed with the U.S. Securities and Exchange Commission a
registration statement on Form 10-SB (the "Registration
Statement"), for the registration of the Company's Common Stock.
As part of the disclosure included in the Registration Statement,
the Company has affirmatively represented that there will be no
trading of the Company's securities until such time as the
Company successfully implements its business plan as described in
such Registration Statement, consummating a merger or
acquisition.
In order to insure that the aforesaid disclosure is adhered
to, the undersigned agrees, for the benefit of the Company, that
he/she will not offer to sell, assign, pledge, hypothecate, grant
any option for the sale of, or otherwise dispose of, directly or
indirectly, any shares of the Common Stock owned by him/her, or
subsequently acquired through the exercise of any options,
warrants or rights, or conversion of any other security, or by
reason of any stock split or other distribution of stock, or
grant options, rights or warrants with respect to any such shares
of Common Stock, until the Company until the Company successfully
closes a merger or acquisition. Furthermore, the undersigned
will permit all certificates evidencing his/her shares to be
endorsed with the appropriate restrictive legends and will
consent to the placement of appropriate stop transfer orders with
the transfer agent of the Company.
Very truly yours,
s/Mary Jackson
______________________________
(signature of holder)
Mary Jackson
Please Print Name
25,000
- ------
Number of shares of Common
Stock owned
69
<PAGE>
December 31, 1998
Board of Directors
N. T. Properties, Inc.
6 Venture, Ste. 207
Irvine, California 92618
Gentlemen:
The undersigned, a beneficial owner of the common stock of
N. T. Properties, Inc. (the "Company"), $0.001 par value per
share (the "Common Stock"), understands that the Company has
filed with the U.S. Securities and Exchange Commission a
registration statement on Form 10-SB (the "Registration
Statement"), for the registration of the Company's Common Stock.
As part of the disclosure included in the Registration Statement,
the Company has affirmatively represented that there will be no
trading of the Company's securities until such time as the
Company successfully implements its business plan as described in
such Registration Statement, consummating a merger or
acquisition.
In order to insure that the aforesaid disclosure is adhered
to, the undersigned agrees, for the benefit of the Company, that
he/she will not offer to sell, assign, pledge, hypothecate, grant
any option for the sale of, or otherwise dispose of, directly or
indirectly, any shares of the Common Stock owned by him/her, or
subsequently acquired through the exercise of any options,
warrants or rights, or conversion of any other security, or by
reason of any stock split or other distribution of stock, or
grant options, rights or warrants with respect to any such shares
of Common Stock, until the Company until the Company successfully
closes a merger or acquisition. Furthermore, the undersigned
will permit all certificates evidencing his/her shares to be
endorsed with the appropriate restrictive legends and will
consent to the placement of appropriate stop transfer orders with
the transfer agent of the Company.
Very truly yours,
s/Alberto Lugo
______________________________
(signature of holder)
Alberto Lugo
Please Print Name
25,000
- ------
Number of shares of Common
Stock owned
70
<PAGE>
December 31, 1998
Board of Directors
N. T. Properties, Inc.
6 Venture, Ste. 207
Irvine, California 92618
Gentlemen:
The undersigned, a beneficial owner of the common stock of
N. T. Properties, Inc. (the "Company"), $0.001 par value per
share (the "Common Stock"), understands that the Company has
filed with the U.S. Securities and Exchange Commission a
registration statement on Form 10-SB (the "Registration
Statement"), for the registration of the Company's Common Stock.
As part of the disclosure included in the Registration Statement,
the Company has affirmatively represented that there will be no
trading of the Company's securities until such time as the
Company successfully implements its business plan as described in
such Registration Statement, consummating a merger or
acquisition.
In order to insure that the aforesaid disclosure is adhered
to, the undersigned agrees, for the benefit of the Company, that
he/she will not offer to sell, assign, pledge, hypothecate, grant
any option for the sale of, or otherwise dispose of, directly or
indirectly, any shares of the Common Stock owned by him/her, or
subsequently acquired through the exercise of any options,
warrants or rights, or conversion of any other security, or by
reason of any stock split or other distribution of stock, or
grant options, rights or warrants with respect to any such shares
of Common Stock, until the Company until the Company successfully
closes a merger or acquisition. Furthermore, the undersigned
will permit all certificates evidencing his/her shares to be
endorsed with the appropriate restrictive legends and will
consent to the placement of appropriate stop transfer orders with
the transfer agent of the Company.
Very truly yours,
s/Bruce Carter
______________________________
(signature of holder)
Bruce Carter
Please Print Name
25,000
- ------
Number of shares of Common
Stock owned
71
<PAGE>
December 31, 1998
Board of Directors
N. T. Properties, Inc.
6 Venture, Ste. 207
Irvine, California 92618
Gentlemen:
The undersigned, a beneficial owner of the common stock of
N. T. Properties, Inc. (the "Company"), $0.001 par value per
share (the "Common Stock"), understands that the Company has
filed with the U.S. Securities and Exchange Commission a
registration statement on Form 10-SB (the "Registration
Statement"), for the registration of the Company's Common Stock.
As part of the disclosure included in the Registration Statement,
the Company has affirmatively represented that there will be no
trading of the Company's securities until such time as the
Company successfully implements its business plan as described in
such Registration Statement, consummating a merger or
acquisition.
In order to insure that the aforesaid disclosure is adhered
to, the undersigned agrees, for the benefit of the Company, that
he/she will not offer to sell, assign, pledge, hypothecate, grant
any option for the sale of, or otherwise dispose of, directly or
indirectly, any shares of the Common Stock owned by him/her, or
subsequently acquired through the exercise of any options,
warrants or rights, or conversion of any other security, or by
reason of any stock split or other distribution of stock, or
grant options, rights or warrants with respect to any such shares
of Common Stock, until the Company until the Company successfully
closes a merger or acquisition. Furthermore, the undersigned
will permit all certificates evidencing his/her shares to be
endorsed with the appropriate restrictive legends and will
consent to the placement of appropriate stop transfer orders with
the transfer agent of the Company.
Very truly yours,
s/Adam Stull
______________________________
(signature of holder)
Adam Stull
Please Print Name
25,000
- ------
Number of shares of Common
Stock owned
72
<PAGE>
December 31, 1998
Board of Directors
N. T. Properties, Inc.
6 Venture, Ste. 207
Irvine, California 92618
Gentlemen:
The undersigned, a beneficial owner of the common stock of
N. T. Properties, Inc. (the "Company"), $0.001 par value per
share (the "Common Stock"), understands that the Company has
filed with the U.S. Securities and Exchange Commission a
registration statement on Form 10-SB (the "Registration
Statement"), for the registration of the Company's Common Stock.
As part of the disclosure included in the Registration Statement,
the Company has affirmatively represented that there will be no
trading of the Company's securities until such time as the
Company successfully implements its business plan as described in
such Registration Statement, consummating a merger or
acquisition.
In order to insure that the aforesaid disclosure is adhered
to, the undersigned agrees, for the benefit of the Company, that
he/she will not offer to sell, assign, pledge, hypothecate, grant
any option for the sale of, or otherwise dispose of, directly or
indirectly, any shares of the Common Stock owned by him/her, or
subsequently acquired through the exercise of any options,
warrants or rights, or conversion of any other security, or by
reason of any stock split or other distribution of stock, or
grant options, rights or warrants with respect to any such shares
of Common Stock, until the Company until the Company successfully
closes a merger or acquisition. Furthermore, the undersigned
will permit all certificates evidencing his/her shares to be
endorsed with the appropriate restrictive legends and will
consent to the placement of appropriate stop transfer orders with
the transfer agent of the Company.
Very truly yours,
s/Katherine Hefler
______________________________
(signature of holder)
Katherine Hefler
Please Print Name
25,000
- ------
Number of shares of Common
Stock owned
73
<PAGE>
N.T. PROPERTIES, INC.
_____________________________
EXHIBIT 27.1
_____________________________
FINANCIAL DATA SCHEDULE
_____________________________
74
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE AUDITED
FINANCIAL STATEMENTS FOR THE FISCAL YEARS ENDED DECEMBER 31, 1997 AND DECEMBER
31, 1998, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
</LEGEND>
<S> <C> <C>
<PERIOD-TYPE> YEAR YEAR
<FISCAL-YEAR-END> DEC-31-1997 DEC-31-1998
<PERIOD-END> DEC-31-1997 DEC-31-1998
<CASH> 0 0
<SECURITIES> 0 0
<RECEIVABLES> 0 0
<ALLOWANCES> 0 0
<INVENTORY> 0 0
<CURRENT-ASSETS> 0 0
<PP&E> 0 0
<DEPRECIATION> 0 0
<TOTAL-ASSETS> 500 500
<CURRENT-LIABILITIES> 1,500 1,600
<BONDS> 0 0
0 0
0 0
<COMMON> 500 500
<OTHER-SE> (1,500) (1,600)
<TOTAL-LIABILITY-AND-EQUITY> 500 500
<SALES> 0 0
<TOTAL-REVENUES> 0 0
<CGS> 0 0
<TOTAL-COSTS> 0 0
<OTHER-EXPENSES> 100 100
<LOSS-PROVISION> 0 0
<INTEREST-EXPENSE> 0 0
<INCOME-PRETAX> (100) (100)
<INCOME-TAX> 0 0
<INCOME-CONTINUING> (100) (100)
<DISCONTINUED> 0 0
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> (100) (100)
<EPS-PRIMARY> (.20) (.20)
<EPS-DILUTED> 0 0
</TABLE>
