U.S. SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549
FORM 10-SB
GENERAL FORM FOR REGISTRATION OF SECURITIES OF SMALL BUSINESS ISSUERS UNDER
SECTION 12(b) OR 12(g) OF THE SECURITIES EXCHANGE ACT OF 1934
Form 10SB12G for MORGAN CLARK MANAGEMENT INC filed on January 5, 2000
MORGAN CLARK MANAGEMENT, INC.
(Name of Small Business Issuer in its charter)
Utah 87-0633496
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(State or other jurisdiction of I.R.S. Employer
incorporation or organization) Identification No.
3158 Redhill Avenue, Suite 240
Costa Mesa, California 92626
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(Address of principal executive offices) (Zip Code)
Issuer's telephone number, including area code (949) 770-2578
Securities to be registered under Section 12(g) of the Act:
Title of each class Name of each exchange on which
to be so registered each such class is to be registered
N/A N/A
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Common Stock, $.001 par value
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(Title of class)
ITEM 1. DESCRIPTION OF BUSINESS
Background
MORGAN CLARK MANAGEMENT, INC. (the Company) is a Utah corporation formed on June
3, 1999. Its principal place of business is located at 3158 Redhill Avenue, Ste
240, Costa Mesa, California 92626. The Company was organized to engage in any
lawful corporate business, including but not limited to, participating in
mergers with and acquisitions of other companies and/or businesses. The Company
has been a developmental stage since inception and has no operating history
other than organizational matters.
The Company was incorporated by Mr. James Barber. He no longer holds any
position with the Company, and holds none of the Company's outstanding common
stock. The Company has never had any operations. On June 3, 1999, founders
shares of the Company's common stock were issued to Vincent Van Den Brink, the
Company's sole officer and director. The shareholder has held his stock since
that time. The primary activity of the Company currently involves seeking a
business or businesses that it can acquire or with whom it can merge.
The Company has not selected any specific business or entity as an acquisition
target or merger partner. The Company does not intend to limit potential
candidates to any particular field or industry, but does retain the right to
limit candidates, if it so chooses, to a particular field or industry.
The Board of Directors has begun to implement the Company's principal business
plan, described below under Item 2. Therefore, the Company can be defined as a
"shell" or "blank check" company whose sole purpose, at this time, is to locate
and consummate a merger or acquisition with a private entity or business.
The Company's business plan classify it 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.
The Company is filing this registration statement on a voluntary basis, pursuant
to section 12(g) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), in order to ensure that public information is readily
accessible to all shareholders and potential investors, and to increase the
Company's access to financial markets. The Company anticipates that it will
continue to file such reports, notwithstanding the fact that it may not
otherwise be required to file a registration statement under Section 12(g) of
the Exchange Act.
Risk Factors
The Company's business is subject to numerous risk factors including, but not
limited to, the following:
No Operating History or Revenues and Minimal Assets. The Company has had no
operating history and has received no revenues or earnings from operations. The
Company has no significant assets or financial resources and, in all likelihood,
will sustain operating expenses without corresponding revenues at least until it
completes a business combination. This may result in the Company incurring a
net operating loss which will increase continuously until the Company completes
a business combination with a profitable business opportunity. There is no
assurance that the Company will successfully identify a business opportunity or
complete 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. Although management intends to seek business combinations with
entities having established operating histories, it cannot be assured that the
Company will successfully locate candidates meeting such criteria. In the event
the Company completes a business combination, the success of the Company's
operations may be dependent upon management of the successor firm or venture
partner firm together with 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 and joint ventures with, and acquisitions of small
private entities. A large number of established and well-financed entities,
including venture capital firms, are active in mergers and acquisitions of
companies which may also be desirable target candidates for the Company. Nearly
all such entities have significantly greater financial resources, technical
expertise, and managerial capabilities than the Company. The Company is,
consequently, at a competitive disadvantage in identifying possible business
opportunities and successfully completing a business combination. Moreover, the
Company will compete with numerous other small public companies in seeking
merger or acquisition candidates.
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 business combination with any
private entity. There can be no assurance the Company will successfully
identify and evaluate suitable business opportunities or conclude a business
combination. Management has not identified any particular industry or specific
business within an industry for evaluations. The Company has been in the
developmental stage since inception and has no operations to date. Other than
issuing shares to its original shareholder, the Company has not commenced any
operational activities. 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 from five to ten
hours per month to the business of the Company on an as-needed basis. The
Company's sole officer and director has not entered into a written employment
agreement with the Company and is not expected to do so in the foreseeable
future. The Company has not obtained key man life insurance on its sole officer
and director. Notwithstanding the combined limited experience and time
commitment of management, loss of the services of any of this individual would
adversely affect development of the Company's business and its likelihood of
continuing operations. See Item 5 - "Directors, Executive Officers, Promoters
and Control Persons".
Conflicts of Interest - General. The Company's sole and director participates in
other business ventures which compete directly with the Company. Additional
conflicts of interest and non arms-length transactions may also arise in the
event the Company's sole directors are involved in the management of any firm
with which the Company transacts business. The Company's Board of Directors has
adopted a resolution which prohibits the Company from completing a combination
with any entity in which management may serve as officers, directors or
partners, or in which they or their family members own or hold any ownership
interest. Management is not aware of any circumstances under which this policy
could be changed while current management is in control of the Company. See
Item 5 - "Directors, Executive Officers, Promoters and Control Persons".
Reporting Requirements May Delay or Preclude Acquisition. Companies subject to
Section 13 of the Exchange Act must provide certain information about
significant acquisitions including, but not limited to, certified financial
statements for the company acquired covering up to two years. The time and
additional costs that may be incurred by some target entities to prepare such
statements may significantly delay or even preclude the Company from completing
an otherwise desirable acquisition. 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 not
conducted or received results of market research indicating that a market demand
exists for the transactions contemplated by the Company. Moreover, the Company
does not have nor does it plan to establish a marketing organization. If there
is demand for a business combination as contemplated by the Company, there is no
assurance the Company will successfully complete such transaction.
Lack of Diversification. In all likelihood, the Company's proposed operations,
even if successful, will result in a business combination with only one entity.
Consequently, the resulting activities will be limited to that entity's
business. 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, thereby increasing the risks associated with the Company's
operations.
Government Regulations. Although the Company will be subject to regulation
under the Exchange Act, management believes the Company will not be subject to
regulation under the Investment Company Act of 1940(the "Investment Company
Act"), 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 become subject to regulation under the
Investment Company Act. 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 (the "Commission") as
to the status of the Company under the Investment Company Act 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 stock will, in all likelihood, result in owners
of a private business or entity 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 stock 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 current 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 such private business or entity. Issuing
previously authorized and unissued common stock of the Company will reduce the
percentage of shares owned by present and prospective shareholders, and a change
in the Company's control and/or management.
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 target company 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. The perceived adverse 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 securities laws enacted for the protection of investors. These
securities laws primarily relate to registering securities and full disclosure
of the Company's business, management, and financial statements.
Taxation. Federal and state tax consequences will, in all likelihood, be major
considerations in any business combination the Company may undertake.
Typically, these transactions may be structured 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.
Management cannot assure that a business combination will meet the statutory
requirements for 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 believes that any potential target must provide
audited financial statements for review, and for the protection of all parties
to the business combination. One or more attractive business opportunities may
forego a business combination with the Company, rather than incur the expenses
associated with preparing audited financial statements. Blue Sky Considerations.
Because the securities registered hereunder have not been registered for resale
under the blue sky laws of any state and the Company has no current plans to
register or qualify its shares in any state, holders of these shares and persons
who desire to purchase them in any trading market that might develop in the
future, should be aware that there may be significant state blue sky
restrictions upon the ability of new investors to purchase the securities.
Some states may restrict the trading or resale of blind-pool or blank-check
securities. Accordingly, investors should consider any potential secondary
market for the Company's securities to be a limited one.
ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF PLAN OF OPERATION
The following information should be read in conjunction with the consolidated
financial statements and notes thereto appearing elsewhere in the Form 10-SB.
The Company is considered a development stage company with minimal or no assets
or capital and with no operations or income since its inception. The costs and
expenses associated with the preparation and filing of this registration
statement have been paid for by an advance from a shareholder of the Company.
It is anticipated that the Company will require only nominal capital to maintain
the corporate viability of the Company and necessary funds will most likely be
provided by the Company's officers and directors in the immediate future.
However, unless the Company is able to facilitate an acquisition of or merger
with an operating business or is able to obtain significant outside financing,
there is substantial doubt about its ability to continue as a going concern.
Risk Factors and Cautionary Statements
This Registration Statement contains certain forward-looking statements. The
Company wishes to advise readers that actual results may differ substantially
from such forward-looking statements. Forward-looking statements involve risks
and uncertainties that could cause actual results to differ materially from
those expressed in or implied by the statements, including, but not limited to,
the following: the ability of the Company search for appropriate business
opportunities and subsequently acquire or merge with such entity, to meet its
cash and working capital needs, the ability of the Company to maintain its
existence as a viable entity, and other risks detailed in the Company's periodic
report filings with the Commission.
Plan of Operation
The Company's plan is to seek, investigate, and if such investigation warrants,
acquire an interest in one or more business opportunities. At this time, the
Company has no plan, proposal, agreement, understanding, or arrangement to
acquire or merge with any specific business or entity, and the Company has not
identified any specific business or entity for investigation and evaluation. No
member of management or any promoter of the Company, or an affiliate of either,
has had any material discussions with any other business or entity with respect
to any acquisition of that business or entity. The Company will not restrict
its search to any specific business, industry, or geographical location, and may
participate in business ventures of virtually any kind or nature. Discussion of
the proposed business under this caption and throughout this Registration
Statement 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.
The Company's potential success is heavily dependant on the Company's
management, which will have virtually unlimited discretion in searching for and
entering into a business combination. The Company's sole officer and director
has not had any experience in the proposed business of the Company.
Management anticipates that it will only participate in one potential business
venture. This lack of diversification should be considered a substantial risk
in investing in 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 combination with a business that (i) only
recently commenced operations; (ii) is a developing company in need of
additional funds to expand into new products or markets; (iii) is seeking to
develop a new product or service; or (iv) is an established business which may
be experiencing financial or operating difficulties and needs additional
capital. In some instances, a business combination may involve acquiring or
merging with a corporation which does not need substantial additional cash but
which desires to establish a public trading market for its common stock. The
Company may purchase assets and establish wholly-owned subsidiaries in various
businesses or purchase existing businesses as subsidiaries.
The Company anticipates that the selection of a business opportunity in which to
participate will be complex and extremely risky. Because of general economic
conditions, rapid technological advances being made in some industries, and
shortages of available capital, management believes that there are numerous
firms seeking the benefits of a publicly-traded corporation. Such perceived
benefits of a publicly traded corporation may include (i) facilitating or
improving the terms on which additional equity financing may be sought; (ii)
providing liquidity for the principals of a business; (iii) creating a means for
providing incentive stock options or similar benefits to key employees; and (iv)
providing liquidity, subject to restrictions of applicable statues, for all
shareholders. 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.
Management believes that the Company may be able to benefit from the use of
leverage to acquire a target company. Leveraging a transaction involves
acquiring a business while incurring significant indebtedness for a large
percentage of the purchase price of that business. Through leveraged
transactions, the Company would be required to use less of its available funds,
if any funds are available, to acquire a target company. Therefore, the Company
could commit those funds to the operations of the business, to combinations with
other target companies, or to other activities. The borrowing involved in a
leveraged transaction will ordinarily be secured by the assets of the acquired
business. If that business is not able to generate sufficient revenues to make
payments on the debt incurred by the Company to acquire that business, the
lender would be able to exercise the remedies provided by law or by contract.
These leveraging techniques, while reducing the amount of funds that the Company
must commit to acquire a business, may correspondingly increase the risk of loss
to the Company. No assurance can be given as to the terms or availability of
financing for any acquisition by the Company. During periods when interest rates
are relatively high, benefits of leveraging are not as great as during periods
of lower interest rates. This is because the investment in the business held on
a leveraged basis will only be profitable if it generates sufficient revenues to
cover the related debt and other costs of the financing.
Lenders from which the Company may obtain funds for purposes of a leveraged
buy-out may impose restrictions on the future borrowing, distribution, and
operating policies of the Company. It is not possible at this time to predict
the restrictions, if any, which lenders may impose, or the impact thereof on the
Company.
As part of any transactions, the acquired entity may require the Company's
management or other shareholders of the Company to sell all or a portion of
their shares to the acquired entity or the principles thereof. It is
anticipated that the sales price of such shares will be lower than the current
market price or anticipated market price of the Company's Common Stock. The
Company's funds are not expected to be used for any stock purchase from
insiders. The Company shareholders will not be provided the opportunity to
approve or consent to such sale. The opportunity to sell all or a portion of
their shares in connection with an acquisition may influence management's
decision to enter into a specific transaction. However, management believes
that since the anticipated sales price will be less than the market value, the
potential of a stock sale by management will be a material factor in their
decision to enter a specific transaction.
The above description of potential sales of management stock is not based upon
any corporate bylaw, shareholder or board resolution, or contract or agreement.
No other payment of cash or property ix expected to be received by management in
connection with any acquisition.
The Company has insufficient capital with which to provide the owners of
businesses significant cash or other assets. Management believes the Company
will offer owners of businesses the opportunity to acquire a controlling
ownership interest in the Company at substantially less cost than is required to
conduct an initial public offering. The owners of the businesses will, however,
incur significant post-merger or acquisition registration costs in the event
they wish to register a portion of their shares for subsequent sale. The
Company will also incur significant legal and accounting costs in connection
with the acquisition of a business opportunity, including the costs of preparing
post-effective amendments, Forms 8-K, agreements, and related reports and
documents. 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. The Company does not intend to make any loans to any
prospective merger or acquisition candidates or to unaffiliated third parties.
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.
Sources of Opportunities
The Company anticipates that business for possible acquisition will be referred
by various sources, including its officers and directors, professional advisors,
securities broker-dealers, venture capitalists, members of the financial
community, and others who may present unsolicited proposals.
The Company will seek a potential business opportunity from all known sources,
but will rely principally on personal contacts of its officers and directors as
well as indirect associations between them and other business and professional
people. It is not presently anticipated that the Company will engage
professional firms specializing in business acquisitions or reorganizations.
The officers and directors of the Company are currently employed in other
positions and, until such time as an acquisition has been determined to be
highly favorable, will devote only a portion of their time to the business
affairs of the Company. If a business opportunity is considered promising,
management will spend additional time, on an as-needed basis, to consummate an
acquisition. In addition, in the face of competing demands for their time, the
officers and directors may grant priority to their full-time position rather
than to the Company.
Management, while not particularly experienced in matters relating to the new
business of the Company, will 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, other than the
Company's legal counsel and accountants, will be used by the Company to
effectuate its business purposes described herein. However, if the Company does
retain such an outside consultant or advisor, any cash fee earned by such party
will need to be paid by the prospective merger/acquisition candidate, as the
Company presently has no cash assets with which to pay such obligation. There
have been no discussions, understandings, contracts or agreements with any
outside consultants and none are anticipated in the future. In the past, the
Company's management has never used outside consultants or advisors in
connection with a merger or acquisition.
As is customary in the industry, the Company may pay a finders fee for locating
an acquisition prospect. If any such fee is paid, it will be approved by the
Company's Board of Directors and will be in accordance with the industry
standards. Such fees are customarily between 1% and 5% of the size of the
transaction, based upon a sliding scale of the amount involved. Management has
adopted a policy that such a finders fee or real estate brokerage fee could, in
certain circumstances, be paid to any employee, officer, director or 5%
shareholder of the Company, if such person plays a material role in bringing a
transaction to the Company. Any such prospective fee will be negotiated in
connection with any potential acquisition or merger. It is not possible at this
time to estimate the terms of any such arrangement.
Most likely the Company will not have sufficient funds to undertake any
significant development, marketing, and manufacturing of any products which may
be acquired. Accordingly, if it acquires the rights to a product, rather than
entering into a merger or acquisition, it most likely would need to seek debt or
equity financing or obtain funding from third parties, in exchange for which the
Company would probably be required to give up a substantial portion of its
interest in any acquired product. There is no assurance that the Company will
be able either to obtain additional financing or to interest third parties in
providing funding for the further development, marketing and manufacturing of
any products acquired.
Evaluation of Opportunities
The analysis of new business opportunities will be undertaken by or under the
supervision of the Board of Directors (see Item 5 - "Directors, Executive
Officers, Promoters and Control Persons"). Management intends to concentrate on
identifying prospective business opportunities which may be brought to its
attention through their present associations and business contacts. In
analyzing prospective business opportunities, management will consider, among
other factors, such matters as:
1. Available technical, financial and managerial resources.
2. Working capital and other financial requirements.
3. History of operation, if any.
4. Prospects for the future.
5. Present and expected competition.
6. Quality and experience of management services which may be
available and the depth of that management.
7. Potential for further research, development or exploration.
8. Specific risk factors not now foreseeable, but which may be
anticipated to impact the proposed activities of the Company.
9. Potential for growth or expansion.
10. Potential for profit.
11. Perceived public recognition or acceptance of products, services
or trades.
12. Name identification.
The Company's management will meet personally with management and key personnel
of the firm sponsoring the business opportunity as part of their investigation.
To the extent possible, the Company intends to use written reports and personal
investigation to evaluate the above factors. The Company will not acquire or
merge with any business or entity for which audited financial statements cannot
be obtained.
It is likely that any opportunity in which the Company participates will present
certain risks. Many of these risks cannot be adequately identified prior to
selection of the specific opportunity, and the Company's shareholders must,
therefore, depend on the ability of management to identify and evaluate such
risk. In the case of some of the opportunities available to the company, it may
be anticipated that the promoters thereof have been unable to develop a going
concern or that such business is in its development state in that it has not
generated significant revenues from its principal business activities prior to
the Company's participation.
There is a risk as to whether, even after the Company becomes involved in an
opportunity, the combined enterprises will be able to become a going concern or
advance beyond the development stage. Many of the potential opportunities may
involve new and untested product, processes, or market strategies which may not
succeed. Such risks will be assumed by the Company and, therefore, its
shareholders.
The Company will not restrict its search for any specific kind of business, 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
currently impossible to predict the status of any business in which the Company
may become engaged, in that such business may need additional capital, may
merely desire to have its shares publicly traded, or may seek other perceived
advantages which the Company may offer.
It is anticipated that the investigation of specific business opportunities and
the negotiation, drafting and execution of relevant agreements, disclosure
documents and other instruments will require substantial management time and
attention and substantial costs for accountants, attorneys and others. If
a decision is made not to participate in a specific business opportunity the
cost
therefore incurred in the related investigation would, most likely, not be
recoverable. Furthermore, even if an agreement is reached for the participation
in a specific business opportunity, the failure to consummate that transaction
may result in the loss of the Company of the related costs incurred.
Opportunities in which the Company participates will present certain risks, many
of which cannot be identified adequately prior to selecting a specific
opportunity.
The Company's shareholders must, therefore, depend on management to identify and
evaluate such risks. Promoters of some opportunities may have been unable to
develop a going concern or may present a business in its development stage, one
that has not generated significant revenues from its principal business
activities prior to the Company's participation. Even after the Company's
participation, there is a risk that the combined enterprise may not become a
going concern or advance beyond the development stage. Other opportunities may
involve new and untested products, processes, or market strategies which may not
succeed. Such risks will be assumed by the Company and, therefore, its
shareholders.
There is the additional risk that the Company may not find a suitable target.
Management does not believe the Company will generate revenue without finding
and completing a transaction with a suitable target company. If no such target
is found, therefore, no return on an investment in the Company will be realized,
and there will not, most likely, be a market for the Company's stock.
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,
franchise, or licensing agreement with the business or entity. It may also
purchase stock or assets of an existing business. Once a transaction is
complete, it is possible that present management and shareholders of the Company
will not be in control of the Company. In addition, a majority or all of the
Company's officers and directors may, as part of the terms of the transaction,
resign and be replaced by new officers and directors without a vote of the
Company's shareholders.
It is anticipated that securities issued in any such reorganization would be
issued in reliance on exemptions from registration under applicable Federal and
state securities laws. In some circumstances, however, as a negotiated element
of this transaction, the Company may agree to register such securities either at
the time the transaction is consummated, under certain conditions, or at
specified time thereafter. The issuance of substantial additional securities and
their potential sale into any trading market which may develop in the Company's
Common Stock may have a depressive effect on such market.
Although the actual terms of a future transaction cannot be predicted, it may be
expected that the parties to the transaction will find it desirable to avoid the
creation of a taxable event and, thereby, structure the transaction as a so
called tax free reorganization under Sections 368(a)(1) or 351 of the Internal
Revenue Code of 1986, as amended (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, including investors in this offering,
would retain less than 20% of the issued and outstanding shares of the surviving
entity, which could 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 or 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 with a target opportunity will
depend on (i) the nature of the opportunity; (ii) the respective needs and
desires of the Company and other parties; (iii) management of the opportunity;
and (iv) the relative negotiating strength of management of the two entities.
With respect to any merger or acquisition, negotiations with target company
management will be expected to focus on the percentage of the Company which the
target company's shareholders would acquire in exchange for 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 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, including purchasers in this offering.
Management has advanced, and will continue to advance, funds which shall be used
by the Company in identifying and pursuing agreements with target companies.
Management anticipates that these funds will be repaid from the proceeds of any
agreement with the target company, and that any such agreement may, in fact, be
contingent upon the repayment of those funds.
Rights of Shareholders
It is presently anticipated by management that prior to consummating a possible
acquisition or merger, the Company, if required by relevant state laws and
regulations, will seek to have the transaction ratified by shareholders in the
appropriate manner. However, under Utah law, certain actions that would
routinely be taken at a meeting of shareholders, may be taken by written consent
of shareholders having not less than the minimum number of votes that would be
necessary to authorize or take the action at a meeting of shareholders. Thus,
if shareholders holding a majority of the Company's outstanding shares decide by
written consent to consummate an acquisition or a merger, minority shareholders
would not be given the opportunity to vote on the issue. The Board of Directors
will have the discretion to consummate an acquisition or merger by written
consent if it is determined to be in the best interest of the Company to do so.
Regardless of whether an action to acquire or merge is ratified by written
consent or by holding a shareholders' meeting, the Company will provide to its
shareholders complete disclosure documentation concerning a potential target
business opportunity including the appropriate audited financial statements of
the target. This information will be disseminated by proxy statement in the
event a shareholders' meeting is held, or by subsequent report to the
shareholders if the action is taken by written consent.
Competition
The Company is an insignificant participant among firms which engage in business
combinations with, or financing of development-stage enterprises. There are
many established management and financial consulting companies and venture
capital firms which have significantly greater financial and personal resources,
technical expertise and experience than the Company. In view of the Company's
limited financial resources and management availability, the Company will
continue to be at a significant competitive disadvantage with its competitors.
Inflation
In the opinion of management, inflation has not and will not have a material
effect on the operations of the Company until such time as the Company
successfully completes an acquisition or merger. At that time, management will
evaluate the possible effects of inflation on the Company related to it business
and operations following a successful acquisition or merger.
Year 2000
Year 2000 issues may arise if computer programs have been written using two
digits (rather than four) to define the applicable year. In such case, programs
that have time-sensitive logic may recognize a date using "00" as the year 1900
rather than the year 2000, which could result in miscalculations or system
failures.
Because the Company currently does not have any operations except for its search
for viable business opportunities, it does not own or use any computer
equipment. The Company does not anticipate doing a full assessment of the
potential Year 2000 issue until it has made an acquisition of or merged with an
operating entity. The Company does not believe that the cost of addressing the
issue will have a material adverse impact on its financial position. Further,
the Company believes that no third parties with whom it may have a material
relationships will be materially affected by the Year 2000 issues.
Regulation and Taxation
The Investment Company Act defines an investment company as an issuer which is
or holds itself out as being engaged primarily in the business of investing,
reinvesting or trading securities. Although the Company does not intend to
engage in such activities, the Company may, through business combinations,
obtain and hold a minority interest in a number of development stage
enterprises.
The Company could be expected to incur significant registration and compliance
costs if required to register under the Investment Company Act. Accordingly,
management will continue to review the Company's activities from time to time
with a view toward reducing the likelihood the Company could be classified as an
investment company.
The Company intends to structure any future merger or acquisition in such manner
as to minimize Federal and state tax consequences to the Company and to any
target company.
Employees
The Company's only employee at the present time is its sole officer and
director, who will devote as much time as the Board of Directors determine is
necessary to carry out the affairs of the Company.
Recent Accounting Pronouncements
The Financial Accounting Standards Board ("FASB") has issued Statement of
Financial Accounting Standard ("SFAS") No. 128, "Earnings Per Share" and
Statement of Financial Accounting Standards No. 129 "Disclosures of Information
About an Entity's Capital Structure." SFAS No. 128 provides a different method
of calculating earnings per share than is currently used in accordance with
Accounting Principles Board Opinion No. 15, "Earnings Per Share." SFAS No. 128
provides for the calculation of "Basic" and "Dilutive" earnings per share.
Basic earnings per share includes no dilution and is computed by dividing income
available to common shareholders by the weighted average number of common shares
outstanding for the period. Diluted earnings per share reflects the potential
dilution of securities that could share in the earnings of an entity, similar to
fully diluted earnings per share. SFAS No. 129 establishes standards for
disclosing information about an entity's capital structure. SFAS No. 128 and
SFAS No. 129 are effective for financial statements issued for periods ending
after December 15, 1997. Their implementation is not expected to have a
material effect on the financial statements.
The FASB has also issued SFAS No. 130, "Reporting Comprehensive Income" and SFAS
No. 131, "Disclosures about Segments of an Enterprise and Related Information."
SFAS No. 130 establishes standards for reporting and display of comprehensive
income, its components and accumulated balances. Comprehensive income is
defined to include all changes in equity except those resulting from investments
by owners and distributions to owners. Among other disclosures, SFAS No. 130
requires that all items that are required to be recognized under current
accounting standards as components of comprehensive income be reported in a
financial statement that displays with the same prominence as other financial
statements. SFAS No. 131 supersedes SFAS No. 14 "Financial Reporting for
Segments of a Business Enterprise." SFAS No. 131 establishes standards on the
way that public companies report financial information about operating segments
in annual financial statements and requires reporting of selected information
about operating segments in interim financial statements issued to the public.
It also establishes standards for disclosure regarding products and services,
geographic areas and major customers. SFAS No. 131 defines operating segments
as components of a company about which separate financial information is
available that is evaluated regularly by the chief operating decision maker in
deciding how to allocate resources and in assessing performance.
SFAS 130 and 131 are effective for financial statements for periods beginning
after December 15, 1997 and requires comparative information for earlier years
to be restated. Management believes the adoption of this statement will have no
material impact on the Company's financial statements.The FASB has also issued
SFAS No 132. "Employers' Disclosures about Pensions and other Postretirement
Benefits," which standardizes the disclosure requirements for pensions and other
Postretirement benefits and requires additional information on changes in the
benefit obligations and fair values of plan assets that will facilitate
financial analysis. SFAS No. 132 is effective for years beginning after December
15, 1997 and requires comparative information for earlier years to be restated,
unless such information is not readily available. Management believes the
adoption of this statement will have no material impact on the Company's
financial statements.
In June 1998, the FASB issued SFAS No. 133, "Accounting for Derivative
Instruments and Hedging Activities" which requires companies to record
derivatives as assets or liabilities, measured at fair market value. Gains or
losses resulting from changes in the values of those derivatives would be
accounted for depending on the use of the derivative and whether it qualifies
for hedge accounting. The key criterion for hedge accounting is that the
hedging relationship must be highly effective in achieving offsetting changes in
fair value or cash flows. SFAS No. 133 is effective for all fiscal quarters of
fiscal years beginning after June 15, 1999. Management believes the adoption of
this statement will have no material impact on the Company's financial
statements.
ITEM 3. DESCRIPTION OF PROPERTY.
The Company at present has no interest in any real property. The Company
neither owns nor leases any real property. Office services are provided without
charge by a director. Such costs are immaterial to the financial statements,
and accordingly, have not been reflected therein.
ITEM 4. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.
The following table sets forth each person known to the Company, as of June 6,
1999, to be a beneficial owner of five percent (5%) or more of the Company's
common stock, by the Company's directors individually, and by all of the
Company's directors and executive officers as a group. Except as noted, each
person has sole voting and investment power with respect to the shares shown.
Presently, the only such beneficial holder is also an executive officer and
director. Therefore, only one table is included.
Title of Name/Address Shares Percentage
Class of Owner Owned Beneficially
Owned
Common Vincent van den Brink 1,000,000 100%
3158 Redhill Ave.
Suite 240
Costa Mesa, CA 92626
ITEM 5. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS, AND CONTROL PERSONS.
Members of the Company's Board of Directors of the Company serve until the next
annual meeting of the shareholders, or until their successors have been
elected. Executive officers serve at the pleasure of the Board of Directors.
There are no agreements for any officer or director to resign at the request of
any other person, and none of the officers or directors named below are acting
on behalf of, or at the direction of, any other person.
The Company's sole officer and director will devote time to the business on an
as-needed basis, which is expected to require five to ten hours per month.
Information as to the sole director and executive officer of the Company is as
follows:
Name/Address Age Position
Vincent van den Brink 58 President/Secretary/Director
3158 Redhill Ave., Ste. 240
Costa Mesa, CA 92626
Vincent van den Brink has been President, Secretary and Director of the Issuer
since June 3, 1999. Since October 1997 to present, he has been a Financial
Consultant with Airway Capital, Costa Mesa, California, providing asset based
lending, factoring, equipment leasing and export financing for various
businesses. From June 1985 until May 1997, he was a Business Consultant writing
business plans and business development plans for companies across the country.
Since 1978 to present, in addition to working for the above companies, he has
been operating an export business providing export consulting, export products
and sourcing products for international clients. He holds a Bachelor's degrees
in automotive engineering from the Auto Technical School in Apeldoorn,
Netherlands. He is fluent in English, Dutch, German and Afrikaans.
Blank Check Experience
Mr. van den Brink is President, Director, and sole shareholder of The
internetcorp.net, Inc., a Nevada blank check company, formed in May, 1999 and
which has filed a Registration Statement with the Commission on Form 10-SB. Mr.
van den Brink is President, Director, and sole shareholder of Glennaire
Financial Services, Inc., a Utah blank check company, formed in March, 1999 and
which has filed a Registration Statement with the Commission on Form 10-SB. It
is possible that Mr. van den Brink may establish additional blind pool or blank
check companies in the future. See "Conflicts of Interest."
Conflicts of Interest
Insofar as the sole officer and director is engaged in other business
activities, management anticipates it will devote only a minor amount of time to
the Company's affairs. The sole officer and director of the Company may in the
future become a shareholder, officer or director of other companies which may be
formed for the purpose of engaging in business activities similar to those
conducted by the Company. 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.
Directors and executive officers of the Company will be subject to the doctrine
of corporate opportunities only insofar as it applies to business opportunities
in which the Company has indicated an interest, either through its proposed
business plan or by way of an express statement of interest contained in the
Company's minutes. Any opportunity contemplated by the Company which may come
to the attention of an officer or director, either in the performance of their
duties or in any other manner, will be considered opportunities of, and be made
available to the Company. A breach of this requirement will be a breach of the
fiduciary duties of the officer or director. If a director is presented with
business opportunities that may conflict with business interests identified by
the Company, such opportunities must be promptly disclosed to the Board of
Directors and made available to the Company. In the event the Board shall
reject an opportunity so presented and only in that event, any of the Company's
officers and directors may avail themselves of such an opportunity. Every
effort will be made to resolve any conflicts that may arise in favor of the
Company. There can be no assurance, however, that these efforts will be
successful.
Subject to the next paragraph, if a situation arises in which more than one
company desires to merge with or acquire a target opportunity, and the
principals of the proposed target have no preference as to which company will
merge or acquire such target, the company of which the President first became an
officer and director will be entitled to proceed with the transaction. Except
as set forth above, the Company 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, as amended ("Securities Act"), and the Exchange Act, 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. 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 Commission as to the status of the Company under the
Investment Company Act and, consequently, any violation of such Act would
subject the Company to material adverse consequences.
ITEM 6. EXECUTIVE COMPENSATION.
The Company's sole director does not receive any compensation for his services
rendered to the Company, nor has he received such compensation in the past. He
has 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 consummating a merger or acquisition. As of the
date of this registration statement, the Company has no funds available to pay
directors. Further, the sole director is not accruing any compensation pursuant
to any agreement with the Company.
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 more 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. Management has agreed to disclose to the Company's Board of
Directors any discussions concerning possible compensation to be by any entity
which proposes to 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 finders 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 finder's fee, either directly or
indirectly, as a result of their respective efforts to implement the Company's
business plan outlined herein. Persons associated with management is meant to
refer to persons with whom management may have had other business dealings, but
who are not affiliated with or relatives of management.
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
The Board of Directors has passed a resolution which contains a policy that the
Company will not seek an acquisition or merger with any entity in which any of
the Company's Officers, Directors, principal shareholders or their affiliates or
associates serve as officer or director or hold any ownership interest.
Management is not aware of any circumstances under which this policy may be
changed through their own initiative.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.
ITEM 8. DESCRIPTION OF SECURITIES.
Common Stock
The Company's Articles of Incorporation authorized the issuance of 140,000,000
shares consisting of 100,000,000 shares of common stock, $0.001 par value, and
40,000,000 shares of preferred stock, $0.001 par value, of which 1,000,000
shares of common stock were issued and are now outstanding. All shares are
non-assessable, without pre-emptive rights, and do not carry cumulative voting
rights. Holders of common shares are entitled to one vote for each share on all
matters to be voted on by shareholders. Also, common shareholders are entitled
to share ratably in dividends, if any, as may be declared by the Company from
time-to-time, from funds legally available. In the event of a liquidation,
dissolution, or winding up of the Company, the holders of shares of common stock
are entitled to share on a pro-rata basis all assets remaining after payment in
full of all liabilities.
Management is not aware of any circumstances in which additional shares of any
class or series of the Company's stock would be issued to management or
promoters, or affiliates or associates of either.
Preferred Stock
The Company's Articles of Incorporation authorizes the issuance of 40,000,000
shares of preferred stock, $0.001 par value, none of which have been issued. The
Company currently has no plans to issue any preferred stock. The Company's
Board of Directors has the authority, without action by the shareholders, to
issue all or any portion of the authorized but unissued preferred stock in one
or more series and to determine the voting rights, preferences as to dividends
and liquidation, conversion rights, and other rights of such series. The
preferred stock, if and when issued, may carry rights superior to those of
common stock; however no preferred stock may be issued with rights equal or
senior to the preferred stock without the consent of a majority of the holders
of then-outstanding preferred stock.
The Company considers it desirable to have preferred stock available to provide
increased flexibility in structuring possible future acquisitions and
financings, and in meeting corporate needs which may arise. If opportunities
arise that would make the issuance of preferred stock desirable, either through
public offering or private placements, the provisions for preferred stock in the
Company's Certificate of Incorporation would avoid the possible delay and
expense of a shareholders meeting, except as may be required by law or
regulatory authorities. Issuance of the preferred stock could result, however,
in a series of securities outstanding that will have certain preferences with
respect to dividends and liquidation over the common stock. This could result
in dilution of the income per share and net book value of the common stock.
Issuance of additional common stock pursuant to any conversion right which may
be attached to the terms of any series of preferred stock may also result in
dilution of the net income per share and the net book value of the common stock.
The specific terms of any series of preferred stock will depend primarily on
market conditions, terms of a proposed acquisition or financing, and other
factor existing at the time of issuance. Therefore it is not possible at this
time to determine in what respect a particular series of preferred stock will be
superior to the Company's common stock or any other series of preferred stock
which the Company may issue. The Board of Directors does not have any specific
plan for the issuance of preferred stock at the present time, and does not
intend to issue any preferred stock at any time except on terms which it deems
to be in the best interest of the Company and its shareholders.
The issuance of preferred stock could have the effect of making it more
difficult for a third party to acquire a majority of the outstanding voting
stock of the Company. Further, certain provisions of Utah law could delay or
make more difficult a merger, tender offer, or proxy contest involving the
Company. Although such provisions are intended to enable the Board of
Directors to maximize shareholder value, they may have the effect of
discouraging takeovers which could be in the best interests of certain
shareholders. There is no assurance that such provisions will not have an
adverse effect on the market value of the Company's stock in the future.
PART II
ITEM 1. MARKET PRICE AND DIVIDENDS ON THE REGISTRANT'S COMMON EQUITY AND
RELATED SHAREHOLDER MATTERS.
The Company's common stock is not quoted on the over-the-counter market or on
any other recognized market or exchange. Management has not undertaken any
discussions, preliminary or otherwise, with any prospective market maker
concerning the participation of such market maker in the after-market 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.
After a business combination, merger or acquisition has been completed, the
Company's sole director will most likely be the person to contact prospective
market makers. It is also possible that persons associated with the entity that
merges with or is acquired by the Company will contact prospective market
makers. The Company does not intend to use consultants to contact market
makers.
Market Price
The ability of an individual shareholder to trade their shares in a particular
state may be subject to various rules and regulations of that state. A number
of states require that an issuer's securities be registered in their state or
appropriately exempted from registration before the securities are permitted to
trade in that state. Presently, the Company has no plans to register its
securities in any particular state.
Although there is presently no market for the Company's shares of common stock,
if a marked does develop it is likely that the shares will be subject to the
provisions of Section 15(g) and Rule 15g-9 of the Exchange Act, commonly
referred to as the "penny stock" rule. Section 15(g) sets forth certain
requirements for transactions in penny stocks and Rule 15g-9(d)(1) incorporates
the definition of penny stock as that used in Rule 3a51-1 of the Exchange Act.
The Commission generally defines penny stock to be any equity security that has
a market price less than $5.00 per share, subject to certain exceptions. Rule
3a51-1 provides that any equity security is considered to be a penny stock
unless that security is: registered and traded on a national securities
exchange meeting specified criteria set by the Commission; authorized for
quotation on The NASDAQ Stock Market; issued by a registered investment company;
excluded from the definition on the basis of price (at least $5.00 per share) or
the issuer's net tangible assets; or exempted from the definition by the
Commission. If the Company's shares are deemed to be a penny stock, trading in
the shares will be subject to additional sales practice requirements on
broker-dealers who sell penny stocks to persons other than established customers
and accredited investors, generally persons with assets in excess of $1,000,000
or annual income exceeding $200,000, or $300,000 together with their spouse.
For transactions covered by these rules, broker-dealers must make a special
suitability determination for the purchase of such securities and must have
received the purchaser's written consent to the transaction prior to the
purchase. Additionally, for any transaction involving a penny stock, unless
exempt, the rules require the delivery, prior to the first transaction, of a
risk disclosure document relating to the penny stock market. A broker-dealer
also must disclose the commissions payable to both the broker-dealer and the
registered representative, and current quotations for the securities. Finally,
monthly statements must be sent disclosing recent price information for the
penny stocks held in the account and information on the limited market in penny
stocks. Consequently, these rules may restrict the ability of broker-dealers to
trade and/or maintain a market in the Company's common stock and may affect the
ability of shareholders to sell their shares.
The National Association of Securities Dealers, Inc. ("NASD"), which administers
The Nasdaq Stock Market, has recently made changes in the criteria for initial
listing on The Nasdaq Small Cap Market and for continued listing. For initial
listing, a company must have net tangible assets of $4 million, market
capitalization of $50 million or net income of $750,000 in the most recently
completed fiscal year or in two of the last three fiscal years. For initial
listing, the common stock must also have a minimum bid price of $4.00 per share.
In order to continue to be included on The Nasdaq Stock Market, a company must
maintain $2,000,000 in net tangible assets and a $1,000,000 market value of its
publicly-traded securities. In addition, continued inclusion requires two
market-makers and a minimum bid price of $1.00 per share.
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 The Nasdaq Stock Market 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 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.
As of the date hereof, the Company has issued and outstanding 1,000,000 shares
of common stock, all of which are deemed "restricted securities" as defined by
the Securities Act. These shares are held by one person, an officer and
director of the Company.
Presently, no outstanding shares are eligible for sale pursuant to Rule 144.
However, restricted shares that have been beneficially owned for more than one
year may be eligible for sale under Rule 144, subject to the volume and other
limitations set forth by such Rule. In general, under Rule 144 as currently in
effect, a person (or persons whose shares are aggregated) who has beneficially
owned restricted shares of the Company for at least one year, including any
person who may be deemed to be an "affiliate" of the Company (as the term
"affiliate" is defined under the Act), is entitled to sell, within any
three-month period, an amount of shares that does not exceed the greater of (i)
the average weekly trading volume in the Company's common stock, as reported
through the automated quotation system of a registered securities association,
during the four calendar weeks preceding such sale or (ii) 1% of the shares then
outstanding. A person who is not deemed to be an "affiliate" of the Company and
has not been an affiliate for the most recent three months, and who has held
restricted shares for at least two years would be entitled to sell such shares
without regard to the resale limitations of Rule 144.
Dividend Policy
The Company has not declared or paid cash dividends or made distributions in the
past, and the Company does not anticipate that it will pay cash dividends or
make distributions in the foreseeable future. The Company currently intends to
retain and invest future earnings to finance its operations.
ITEM 2. LEGAL PROCEEDINGS.
The Company is not a party to any material pending legal proceedings and, to the
best of its knowledge, no such action by or against the Company has been
threatened.
ITEM 3. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS.
This Item is not applicable to the Company.
ITEM 4. RECENT SALES OF UNREGISTERED SECURITIES.
All shares of the Company's common stock presently outstanding were issued to
the founder of the Company on June 3, 1999. These shares were issued in a
private transaction in accordance with the exemption from registration afforded
by Section 4(2) of the Securities Act. No transfers of stock have occurred
since June 3, 1999. No advertising or general solicitation was employed in
offering the shares. The securities were offered for investment only and not
for the purpose of resale or distribution, and the transfer thereof was
appropriately restricted.
ITEM 5. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
As permitted by the provisions of the Utah Revised Business Corporation Act (the
"Utah Act"), the Company has the power to indemnify an individual made a party
to a proceeding because they are or were a director, against liability incurred
in the proceeding, if such individual acted in good faith and in a manner
reasonably believed to be in, or not opposed to, the best interest of the
Company and, in a criminal proceeding, they had no reasonable cause to believe
their conduct was unlawful. Indemnification under this provision is limited to
reasonable expenses incurred in connection with the proceeding. The Company
must indemnify a director or officer who is successful, on the merits of
otherwise, in the defense of any proceeding or in defense of any claim, issue,
or matter in the proceeding, to which they are a party to because they are or
were a director of officer of the Company, against reasonable expenses incurred
by them in connection with the proceeding or claim with respect to which they
have been successful. Pursuant to the Utah Act, the Company's Board of
Directors may indemnify its officers, directors, agents, or employees against
any loss or damage sustained when acting in good faith in the performance of
their corporate duties.
The Company may pay for or reimburse reasonable expenses incurred by a director,
officer employee, fiduciary or agent of the Company who is a party to a
proceeding in advance of final disposition of the proceeding provided the
individual furnishes the Company with a written affirmation that their conduct
was in good faith and in a manner reasonably believed to be in, or not opposed
to, the best interest of the Company, and undertake to repay the advance if it
is ultimately determined that they did not meet such standard of conduct.
Also pursuant to the Utah Act, a corporation may set forth in its articles of
incorporation, by-laws or by resolution, a provision eliminating or limiting in
certain circumstances, liability of a director to the corporation or its
shareholders for monetary damages for any action taken or any failure to take
action as a director. This provision does not eliminate or limit the liability
of a director (i) for the amount of a financial benefit received by a director
to which they are not entitled; (ii) an intentional infliction of harm on the
corporation or its shareholders; (iii) for liability for a violation of Section
16-10a-842 of the Utah Act (relating to the distributions made in violation of
the Utah Act); and (iv) an intentional violation of criminal law. To date, the
Company has not adopted such a provision in its Articles of Incorporation,
By-Laws, or by resolution. A corporation may not eliminate or limit the
liability of a director for any act or omission occurring prior to the date when
such provision becomes effective. The Utah Act also permits a corporation to
purchase and maintain liability insurance on behalf of its directors, officers,
employees, fiduciaries or agents.
Transfer Agent
The Company is presently acting as its own transfer agent. It is likely that
following a business combination, merger or acquisition, the Company will engage
a transfer agent.
PART F/S
The Company's financial statements as of September 30, 1999 and June 30, 1999
and the related statements of operations, stockholders' equity (deficit) and
cash flows for the three months ended September 30, 1999 and from inception on
June 3, 1999 through June 30, 1999 and September 30, 1999 have been examined to
the extent indicated in their reports by Jones, Jensen & Company, independent
certified public accountants, and have been prepared in accordance with
generally accepted accounting principles and pursuant to Regulation S-B as
promulgated by the Commission and are included herein in response to Item 15 of
this Form 10-SB.
INDEPENDENT AUDITORS' REPORT
To the Board of Directors
Morgan Clark Management, Inc.
(A Development Stage Company)
Costa Mesa, California
We have audited the accompanying balance sheets of Morgan Clark Management, Inc.
(a development stage company) as of September 30, 1999 and June 30, 1999 and the
related statements of operations, stockholders' equity (deficit) and cash flows
for the three months ended September 30, 1999 and from inception on June 3, 1999
through June 30, 1999 and September 30, 1999. These financial statements are
the responsibility of the Company's management. Our responsibility is to
express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the 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 our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Morgan Clark Management, Inc.
(a development stage company) as of September 30, 1999 and June 30, 1999 and the
results of its operations and its cash flows for the three months ended
September 30, 1999 and from inception on June 3, 1999 through June 30, 1999 and
September 30, 1999 in conformity with generally accepted accounting principles.
The accounting financial statements have been prepared assuming that the Company
will continue as a going concern.
As discussed in Note 2 to the financial statements, the Company is a development
stage company with no significant operating results to date, which raises
substantial doubt about its ability to continue as a going concern. Management's
plans in regard to these matters are also described in Note 2. The financial
statements do not include any adjustments that might result from the outcome of
this uncertainty.
Jones, Jensen & Company
Salt Lake City, Utah
December 16, 1999
[CAPTION]
MORGAN CLARK MANAGEMENT, INC.
(A Development Stage Company)
Balance Sheets for the period
June 30, 1999 and September 30, 1999
September 30 June 30
1999 1999
CURRENT ASSETS
- -
Cash $___________ $___________
- -
Total Current Assets ___________ ___________
TOTAL ASSETS $ - $ -
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
CURRENT LIABILITIES
Accounts payable $ 1,000 $ -
Accounts payable - related party 100 100
___________ ___________
Total Liabilities 1,100 100
STOCKHOLDERS' EQUITY (DEFICIT)
Preferred stock: $0.001 par value, authorized
40,000,000 shares; -0- shares issued and
outstanding - -
Common stock: $0.001 par value, authorized
100,000,000 shares; 1,000,000 shares issued
and outstanding 1,000 1,000
Subscription receivable (900) (900)
Additional paid-in capital - -
Deficit accumulated during the
development stage (1,200) (200)
Total Stockholders' Equity (Deficit) (1,100) (100)
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY (DEFICIT) $ - $ -
[CAPTION]
MORGAN CLARK MANAGEMENT, INC.
(A Development Stage Company)
Statements of Operations
From
For the Inception on
Three Months June 30,
Ended ______________________
September 30 June 30, September
1999 1999 1999
REVENUES $ - $ - $ -
OPERATING COSTS
General and administrative 1,000 200 1,200
Total Operating Costs 1,000 200 1,200
LOSS FROM OPERATIONS (1,000) (200) (1,200)
NET LOSS $ (1,000) (200) (1,200)
LOSS PER SHARE $ (0.00) $ (0.00) $ (0.00)
======== =========== ==========
WEIGHTED AVERAGE NUMBER
OF COMMON SHARES OUTSTANDING 1,000,000 1,000,000
========== ===========
[CAPTION]
MORGAN CLARK MANAGEMENT, INC.
(A Development Stage Company)
Statements of Stockholders' Equity
(Deficit)
Deficit
Accumulated
Additional Sub- During the
Common Stock Paid-in scription Development
Shares Amount Capital Receivable Stage
___________ _______ __________ __________ _________
Balance, June 3, 1999
(Inception) 1,000,000 $ 1,000 $ - $ (900) $ -
Net loss from
inception on June 3,
1999 through
June 30, 1999 - - - - (200)
Balance, June 30, 1999 1,000,000 1,000 - (900) (200)
Net loss for the three
months ended
September 30, 1999 - - - - (1,000)
___________ _______ ____________ __________ _________
Balance,
September 30, 1999 1,000,000 $ 1,000 $ $(900) $ (1,200)
[CAPTION]
MORGAN CLARK MANAGEMENT, INC.
(A Development Stage Company)
Statements of Cash Flows
From
For the Inception on
Three Months June 30,
Ended ______________________
September 30 June 30, September
1999 1999 1999
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss $ 1,000 $ 200 $ 1,200
Changes in operating assets
and liabilities:
Increase (decrease) in
accounts payable 1,000 100 1,100
Net Cash (Used) by Operating Activities - (100) (100)
CASH FLOWS FROM INVESTING ACTIVITIES - - -
CASH FLOWS FROM FINANCING ACTIVITIES
Common stock issued for cash - 100 100
Net Cash Provided by Financing Activities - 100 100
INCREASE IN CASH AND CASH EQUIVALENTS - - -
CASH AND CASH EQUIVALENTS AT BEGINNING
OF PERIOD - - -
CASH AND CASH EQUIVALENTS AT END OF
PERIOD $ - $ - $ -
Cash paid for:
Interest - $ - $ -
Income taxes $ - $ - $ -
[CAPTION]
MORGAN CLARK MANAGEMENT, INC.
(A Development Stage Company)
Notes to the Financial Statements
September 30, 1999 and June 30, 1999
NOTE 1 -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
a. Organization
The Company was organized under the laws of the State of Utah on June 3,
1999. The purpose of the corporation is to engage in any lawful activity.
Currently, the Company is seeking new business opportunities believed to hold a
potential profit or to merge with an existing company.
b. Accounting Method
The Company's financial statements are prepared using the accrual method of
accounting. The Company has adopted a June 30 year end.
c. Basic Loss Per Share For the Three Months Ended September 30, 1999
Loss Share Per Share
(Numerator) (Denominator) Amount
___________ _____________ _________
$ (1,000) 1,000,000 $ (0.00)
From Inception on June 3, 1999 Through
June 30, 1999
_________________
Loss Shares Per Share
(Numerator) (Denominator) Amount
$ (200) 1,000,000 $ (0.00)
The computations of basic loss per share of common stock are based on weighted
average number of shares issued and outstanding at the date of the financial
statements.
d. Use of Estimates
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statement and the
reported amounts of revenues and expenses during the reporting period. Actual
results could differ from those estimates.
MORGAN CLARK MANAGEMENT, INC.
(A Development Stage company)
Notes to the Financial Statements
September 30, 1999 and June 30, 1999
NOTE 1 -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(Continued)
e. Cash Equivalents
The Company considers all highly liquid investments with a maturity of three
months or less when purchased to be cash equivalents.
f. Provision for Taxes
At September 30, 1999, the Company had net operating loss carry forwards of
approximately $1,200 that may be offset against future taxable income through
2014. No tax benefit has been reported in the financial statements, because the
potential tax benefits of the net operating loss carry forwards are offset by a
valuation allowance of the same amounts.
NOTE 2 -GOING CONCERN
The Company's financial statements are prepared using generally
accepted accounting principles applicable to a going concern which
contemplates the realization of assets and liquidation of liabilities in the
normal course of business. However, the Company does not have
significant cash or other material assets, nor does it have an established
source of revenues sufficient to cover its operating costs and to allow it
to continue as a going concern. It is the intent of the Company to seek a
merger with an existing, operating company. In the interim,
shareholders of the Company have committed to meeting its minimal
operating expenses.
PART III
ITEM 1. Index to Exhibits
The following exhibits are filed with this Registration Statement:
Exhibit No. Exhibit Name
3.1 Articles of Incorporation
3.2 By-Laws
4. See Exhibit No. 3.1, Articles of Incorporation,
Article Fifth
27. Financial Data Schedule
________________
ITEM 2. Description of Exhibits
See Item 1 above.
SIGNATURES
In accordance with Section 12 of the Securities and Exchange Act of 1934, the
registrant caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly organized.
MORGAN CLARK MANAGEMENT, INC.
(Registrant)
Date: January 5, 2000 By: /s/ Vincent van den Brink
Vincent van den Brink, President
EXHIBIT 3.1
ARTICLES OF INCORPORATION
OF MORGAN CLARK MANAGEMENT, INC.
The undersigned, a natural person at least eighteen years old, does hereby act
as incorporator in adopting the following Articles of Incorporation for the
purpose of organizing the business corporation hereinafter named MORGAN CLARK
MANAGEMENT, INC., pursuant to the provisions of the Utah Revised Business
Corporation Act.
FIRST: The name of the corporation is MORGAN CLARK MANAGEMENT, INC. (the
"Corporation").
SECOND: The principal office of the Corporation in the State of Utah is located
at 935 E. 7220 South, Ste. D-103, Midvale, Utah 84047. The name and address of
the registered agent of the Corporation is Mr. James Barber, 935 E. 7220 South,
Ste. D-103, Midvale, Utah 84047. The registered office of the Corporation is 935
E. 7220 South, Ste. D-103, Midvale, Utah 84047. The name and address of the
first Director and Incorporator is Mr. James Barber, 935 E. 7220 South, Ste.
D-103,Midvale, Utah 84047. The signature of the said registered agent is set
forth in the last Article of these Articles of Incorporation.
THIRD: The purpose of the Corporation is to engage in any awful act or activity
for which a corporation may be organized under the Utah Revised Business
Corporation Act and the duration of the Corporation shall be perpetual.
FOURTH: The following provisions are inserted for the of the business and the
conduct of the affairs of the Corporation, and for further definition,
limitation and regulation of the powers of the Corporation and of its directors
and stockholders:
A. The governing board of this Corporation shall be known as the board of
directors (the "Board of Directors" or the "Board") and its members all be known
as directors, and the number of directors may from time to time be increased or
decreased by resolution of the Board of Directors, provided that the number of
directors shall not be reduced to less than one (1). The Board of Directors
shall be divided into three classes, as nearly equal in number as possible, and
the term of office for each respective class of directors shall be so arranged
thatthe term of office of directors of one class shall expire at each successive
annual meeting of stockholders, and in all cases as to each director until their
successor shall be elected and shall qualify, or until his earlier resignation,
removal from office, death or incapacity. At each annual meeting of stockholders
after the first annual meeting, the number of directors equal to the number of
directors of the class whose term expires at the time of such meeting (or such
greater or lesser number as would be required by an increase or decrease in the
size of the Board of Directors) shall be elected to hold office until the third
succeeding annual meeting of stockholders after their election. This Article
FOURTH may not be amended or repealed without the affirmative vote of at least
sixty-six and two-thirds percent (66-2/3%) of the voting power of the shares
entitled to vote thereon.
B. Special meetings of stockholders of the Corporation may be called only by the
Chairman of the Board or the President or by the Board of Directors acting
pursuant to a resolution adopted by a majority of the Whole Board. For purposes
of these Articles of Corporation, the term "Whole Board" shall mean the total
number of authorized directors whether or not there exists any vacancies in
previously authorized directorships.
FIFTH: A. The total number of shares of all classes of stock which the
Corporation shall have authority to issue is One Hundred Forty Million
(140,000,000), consisting of One Hundred million (100,000,000) shares of common
stock, par value one-tenth of one cent ($0.001) per share (the "Common Stock")
and Forty million (40,000,000) shares of preferred stock, par value one-tenth
of one cent ($0.001) per share (the "Preferred Stock").
B. COMMON STOCK. The shares of Common Stock shall have no pre-emptive or
preferential rights of subscription concerning further issuance or authorization
of any securities of the Corporation. Each share of Common Stock shall entitle
the holder thereof to one vote, in person or by proxy. The holders of the Common
Stock shall be entitled to receive dividends if, as and when declared by the
Board of Directors.
The Common Stock may be issued from time to time in one or more series and shall
have such other relative, participant, optional or special rights,
qualifications, limitations or restrictions thereof as shall be stated and
expressed in the resolution or resolutions providing for the issuance of such
Common Stock from time to time adopted by the Board of Directors pursuant to
authority so to adopt which is hereby vested in the Board of Directors.
C. REFERRED STOCK. The Preferred Stock may be issued from time to time in one
or more series and (a) may have such voting powers, full or limited, or may be
without voting powers; (b) may be subject to redemption at such time or times
and at such prices; (c) may be entitled to receive dividends (which may be
cumulative or non-cumulative) at such rate or rates, on such conditions, and at
such times, and payable in preference to, or in such relation to, the dividends
payable on any other class or classes or series of stock; (d) may have such
rights upon the dissolution of, or upon any distribution of the assets of, the
Corporation; (e) may be made convertible into, or exchangeable for, shares of
any other class or classes or of any other series of the same or any other class
or classes of stock of the Corporation, at such price or prices or at such rates
of exchange, and with such adjustments and (f) shall have such other relative,
participating, optional or special rights, qualifications, limitations or
restrictions thereof as shall hereafter be stated and expressed in the
resolution or resolutions providing for the issuance of such Preferred Stock
from time to time adopted by the Board of Directors pursuant to authority so to
do which is hereby vested in the Board of Directors.
At any time from time to time when authorized by resolution of the Board of
Directors and without any action by its shareholders, the Corporation may issue
or sell any shares of its stock of any Class or series, whether out of the
unissued shares thereof authorized by these Articles of Incorporation, as
amended, or out of shares of its stock acquired by it after the issue thereof,
and whether or not the shares thereof so issued or sold shall confer upon the
holders thereof the right to exchange or convert such shares for or into other
shares of stock of the Corporation of any class or classes or any series
thereof. When similarly authorized, but without any action by its shareholders,
the Corporation may issue or grant rights, warrants or options, in bearer or
registered or such other form as the Board of Directors may determine, for the
purchase of shares of the stock of any class or series of the Corporation within
such period of time, or without limit as to time, of such aggregate number of
shares, and at such price per share, as the Board of Directors may determine.
Such rights, warrants or options may be issued or granted separately or in
connection with the issue of any bonds, debentures, notes, obligations or other
evidences of indebtedness or shares of the stock of any class or series of the
Corporation and for such consideration and on such terms and conditions as the
Board of Directors, in its sole discretion, may determine. In each case, the
consideration to be received by the Corporation for any such shares so issued or
sold shall be such as shall be fixed from time to time by the Board of
Directors.
D. The capital stock, after the amount of the subscription price, or par value,
has been paid in, shall not be subject to assessment.
E. No holder of shares of stock of the Corporation shall be entitled as of
right to purchase or subscribe for any part of any unissued stock of this
Corporation or of any new or additional authorized stock of the Corporation of
any class whatsoever, or of any issue of securities of the Corporation
convertible into stock, whether such stock or securities be issued for money or
for a consideration other than money or by way of dividend, but any such
unissued stock or such new or additional authorized stock or such securities
convertible into stock may be issued and disposed of to such persons, firms,
corporations and associations, and upon such terms as may be deemed advisable by
the Board of Directors without offering to stockholders of record or any class
of stockholders upon the same terms or upon any terms.
SIXTH: A. Subject to the rights of the holders of any series of Preferred
Stock to elect additional directors under specified circumstances, the number of
directors shall be fixed from time to time exclusively by the Board of Directors
pursuant to a resolution adopted by a majority of the Whole Board. The first
Director shall be the undersigned incorporator.
B. Subject to the rights of the holders of any series of Preferred Stock then
outstanding, newly created directorships resulting from any increase in the
authorized number of directors or any vacancies in the Board of Directors
resulting from death, resignation, retirement, disqualification, removal from
office or other cause shall, unless otherwise provided by law or by resolution
of the Board of Directors, be filled only by a majority vote of the directors
then in office, though less than a quorum, and directors so chosen shall hold
office for a term expiring at the annual meeting of stockholders at which the
term of office of the class to which they have been chosen expires. No decrease
in the authorized number of directors shall shorten the term of any incumbent
director.
C. Advance notice of stockholder nominations for the election of directors and
of business to be brought by stockholders before any meeting of the stockholders
of the Corporation shall be given in the manner provided in the by-laws of the
Corporation.
D. Subject to the rights of the holders of any series of Preferred Stock then
outstanding, any directors, or the entire Board of Directors, may be removed
from office at any time, but only for cause and only by the affirmative vote of
the holders at least fifty percent (50%) of the voting power of all of the
then-outstanding shares of capital stock of the Corporation entitled to vote
generally in the election of directors, voting together as a single class.
SEVENTH: The Board of Directors is expressly empowered to adopt, amend or
repeal by-laws of the Corporation. Any adoption, amendment or repeal of the
by-laws of the Corporation by the Board of Directors shall require the approval
of a majority of the Whole Board. The stockholders shall also have power to
adopt, amend or repeal the by-laws of the Corporation; provided, however, that,
in addition to any vote of the holders of any class or series of stock of the
Corporation required by law or by these Articles of Corporation, the affirmative
vote of the holders of at least fifty percent (50%) of the voting power of all
of the then-outstanding shares of the capital stock of the Corporation entitled
to vote generally in the election of directors, voting together as a single
class, shall be required to adopt, amend or repeal any provision of the by-laws
of the Corporation.
EIGHTH: The Corporation reserves the right to amend or repeal any provision
contained in these Articles of Incorporation in the manner prescribed by the
laws of the State of Utah and all rights conferred upon stockholders are granted
subject to this reservation; provided, however, that, notwithstanding any other
provision of these Articles of Incorporation or any provision of law that might
otherwise permit a lesser vote or no vote, but in addition to any vote of the
holders of any class or series of the stock of this Corporation required by law
or by these Articles of Incorporation, the affirmative vote of the holders of at
least sixty-six and two-thirds percent (66-2/3%) of the voting power of all the
then-outstanding shares of the capital stock of the Corporation entitled to vote
generally in the election of Directors, voting together as a single class, shall
be required to amend or repeal this Article EIGHTH, Article SIXTH, Article
SEVENTH, or Article NINTH.
NINTH: The Board of Directors of the Corporation, when evaluating any offer of
another party to (a) make a tender or exchange offer for any equity security of
the Corporation, (b) merge or consolidate the Corporation with another
corporation or (c) purchase or otherwise acquire all or substantially all of the
properties and assets of the Corporation, may, in connection with the exercise
of its judgment in determining what is in the best interests of the Corporation
and its stockholders, give due consideration to (i) all relevant factors,
including without limitation the social, legal, environmental and economic
effects on the employees, customers, suppliers and other affected persons, firms
and corporations, and on the communities and geographical areas in which the
Corporation and its subsidiaries operate or are located and on any of the
businesses and properties of the Corporation or any of its subsidiaries, as
well as such other factors as the directors deem relevant, (ii) not only the
financial consideration being offered in relation to the then current market
price for the Corporation's outstanding shares of capital stock, but also in
relation to the then current value of the Corporation in a freely negotiated
transaction and in relation to the Board of Directors' estimate of the future
value of the Corporation (including the unrealized value of its properties and
assets) as an independent going concern, and (iii) the obligations of the
Corporation, and any of its subsidiaries, to provide stable, reliable services
on a continuing or long term basis.
TENTH: A director or officer of the Corporation shall have no personal liability
to the Corporation or its stockholders for damages for breach of fiduciary duty
as a director or officer, except for (a) acts or omissions which involve
intentional misconduct, fraud or a knowing violation of law; or (b) the payment
of dividends in violation of the applicable statutes of Utah. If the Utah
Revised Business Corporation Act is amended after approval by the stockholders
of this Article TENTH to authorize corporate action further eliminating or
limiting the personal liability of directors or officers, the liability of a
director or officer of the Corporation shall be eliminated or limited to the
fullest extent permitted by the Utah General Corporation Law, as so amended from
time to time. No repeal or modification of this Article TENTH by the
stockholders shall adversely affect any right or protection of a director or
officer of the Corporation existing by virtue of this Article TENTH at the time
of such repeal or modification.
ELEVENTH: A. The Corporation shall indemnify and hold harmless any person who
was or is a party or is threatened to be made a party to any threatened, pending
or completed action, suit or proceeding, whether civil, criminal, administrative
or investigative, by reason of the fact that he or she is or was or has agreed
to become a director or officer of the Corporation or is serving at the request
of the Corporation as a director or officer of another corporation, partnership,
joint venture, trust, employee benefit plan or other enterprise or by reason of
actions alleged to have been taken or omitted in such capacity or in any other
capacity while serving as a director or officer. The indemnification of
directors and officers by the Corporation shall be to the fullest extent
authorized or permitted by applicable law, as such law exists or may hereafter
be amended (but only to the extent that such amendment permits the Corporation
to provide broader indemnification rights than permitted prior to the
amendment). The indemnification of directors and officers shall be against all
loss, liability and expense (including attorneys fees, costs, damages,
judgments, fines, amounts paid in settlement and ERISA excise taxes or
penalties) actually and reasonably incurred by or on behalf of a director or
officer in connection with such action, suit or proceeding, including any
appeal; provided, however, that with respect to any action, suit or proceeding
initiated by a director or officer, the Corporation shall indemnify such
director or officer only if the action, suit or proceeding was authorized by the
Board of Directors of the Corporation, except with respect to a suit for the
enforcement of rights to indemnification or advancement of expenses in
accordance with Section C below.
B. The expenses of directors and officers incurred as a party to any threatened,
pending or completed action, suit or proceeding,whethercivil, criminal,
administrative or investigative shall be paid by the Corporation as they are
incurred and in advance of the final disposition of the action, suit or
proceeding; provided, however, that if applicable law so requires, the advance
payment of expenses shall be made only upon receipt by the Corporation of an
undertaking by or on behalf of the director or officer to repay ail amounts so
advanced in the event that it is ultimately determined by a final decision,
order or decree of a court of competent jurisdiction that the director or
officer is not entitled to be indemnified for such expenses under this Article
ELEVENTH.
C. Any director or officer may enforce his or her rights to indemnification or
advance payments for expenses in a suit brought against the Corporation if his
or her request for indemnification or advance payments for expenses is wholly or
partially refused by the Corporation or if there is no determination with
respect to such request within 60 days from receipt by the Corporation of a
written notice from the director or officer for such a determination. If a
director or officer is successful in establishing in a suit his or her
entitlement to receive or recover an advancement of expenses or a right to
indemnification, in whole or in part, he or she shall also be indemnified by the
Corporation for costs and expenses incurred in such suit. It shall be a defense
to any such suit (other than a suit brought to enforce a claim for the
advancement of expenses under Section B of this Article ELEVENTH where the
required undertaking, if any, has been received by the Corporation) that the
claimant has not met the standard of conduct set forth in the Utah Revised
Business Corporation Act. Neither the failure of the Corporation to have made a
determination prior to the commencement of such suit that indemnification of the
director or officer is proper in the circumstances because the director or
officer has met the applicable standard of conduct nor a determination by the
Corporation that the director or officer has not met such applicable standard of
conduct shall be a defense to the suit or create a presumption that the director
or officer has not met the applicable standard of conduct. In a suit brought by
a director or officer to enforce a right under this Section C or by the
Corporation to recover and advancement of expenses pursuant to the terms of an
undertaking, the burden of proving that a director or officer is not entitled to
be indemnified or is not entitled to an advancement of expenses under this
Section C or otherwise, shall be on the Corporation.
D. The right to indemnification and to the payment of expenses as they are
incurred and in advance of the final disposition of the action, suit or
proceeding shall not be exclusive of any other right to which a person may be
entitled under these Articles of Incorporation or any by-law, agreement,
statute, vote of stockholders or disinterested directors or otherwise. The right
to indemnification under Section A above shall continue for a person who has
ceased to be a director or officer and shall inure to the benefit of his or her
heirs, next of kin, executors, administrators and legal representatives.
E. The Corporation may maintain insurance, at its expense, to protect itself and
any director, officer, employee or agent of the Corporation or another
corporation, partnership, joint venture, trust or other enterprise against any
loss, liability or expense, whether or not the Corporation would have the power
to indemnify such person against such loss, liability or expense under the Utah
General Corporation Law.
F. The Corporation shall not be obligated to reimburse the amount of any
settlement unless it has agreed to such settlement. If any person shall
unreasonably fail to enter into a settlement of any action, suit or proceeding
within the scope of Section A above, offered or assented to by the opposing
party or parties and which is acceptable to the Corporation, then,
notwithstanding any other provision of this Article ELEVENTH, the
indemnification obligation of the Corporation in connection with such action,
suit or proceeding shall be limited to the total of the amount at which
settlement could have been made and the expenses incurred by such person prior
to the time the settlement could reasonably have been effected.
G. The Corporation may, to the extent authorized from time to time by the Board
of Directors, grant rights to indemnification and to the advancement of
expenses to any employee or agent of the Corporation or to any director,
officer, employee or agent of any of its subsidiaries to the fullest extent of
the provisions of this Article ELEVENTH subject to the imposition of any
conditions or limitations as the Board of Directors of the Corporation may deem
necessary or appropriate.
TWELFTH: In the event of a conflict between the terms of these Articles of
Incorporation and the By-Laws of the Corporation, the terms and provisions of
these Articles of Incorporation shall govern.
THIRTEENTH: The signature of the aforesaid registered
agent of the corporation is as follows:
___________________________
JAMES BARBER
935 E. 7220 South, Ste. D-103
Midvale, Utah 84047
THE UNDERSIGNED, being the incorporator of this Corporation, for
the purpose of adopting these Articles of Incorporation under
the laws of the State of Utah do make, file and record these
Articles of Incorporation, do certify that the facts herein
stated are true, and, accordingly, have hereto set my hand and
seal this ____ day of June, 1999.
____________________________________
JAMES BARBER, Incorporator, Director
935 E. 7220 South, Ste. D-103,
Midvale, Utah 84047
EXHIBIT 3.2
BYLAWS OF
MORGAN CLARK MANAGEMENT, INC.
ARTICLE I: OFFICES
The principal office of the Corporation in the State of Utah shall be
located in Salt Lake City; the Corporation may have such other offices,
either within or without the State of Utah, as the Board of Directors my
designate or as the business of the Corporation may require from time
to time.
ARTICLE II: SHAREHOLDERS
SECTION 1. Annual Meeting. The annual meeting of the shareholders shall
be held on the 15th day in the month of December in each year, beginning
with transaction of such other business as may come before the meeting.
If the day fixed for the annual meeting shall be a legal holiday in the
State of Utah, such meeting shall be held on the next succeeding business
day. If the election of Directors shall be held on the day designated
herein for any annual meeting of the shareholders or at any adjournment
thereof, the Board of Directors shall cause the election to be held at a
special meeting of the shareholders as soon thereafter as conveniently
may be.
SECTION 2. Special Meetings. Special meeting of the
shareholders, for any purpose or purposes, unless otherwise
prescribed by statute, may be called by the President or by the
Board of Directors, and shall be called by the President at the
request of the holders of not less than ten percent (10%) of all
the outstanding shares of the Corporation entitled to vote at
the meeting.
SECTION 3. Place of Meeting. The Board of Directors my
designate any place, either within or without the State of Utah,
unless otherwise prescribed by statute, as the place of meeting
for any annual meeting or for any special meeting. A waiver of
notice signed by all shareholders entitled to vote at a meeting
may designate any place, either within our without the State of
Utah, unless otherwise prescribed by statute, as the place for
the holding of such meeting. If no designation is made, the
place of meeting shall be the principal office of the
Corporation.
SECTION 4. Notice of Meeting. Written notice stating the
place, day and hour of the meeting and, in case of a special
meeting, the purpose or purposes for which the meeting is
called, shall unless otherwise prescribed by statute, be
delivered not less than ten (10) nor more than sixty (60) days
before the date of the meeting, to each shareholder of record
entitled to vote at such meeting. If mailed, such notice shall
be deemed to be delivered when deposited in the United States
Mail, addressed to the shareholder at his address as it appears
on the stock transfer books of the Corporation, with postage
thereon prepaid.
SECTION 5. Closing of Transfer Books or Fixing of Record.
For the purpose of determining shareholders entitled to notice
of or to vote at any meeting of shareholders or any adjournment
thereof, or shareholders entitled to receive payment of any
dividend, or in order to make a determination of shareholders
for any other proper purpose, the Board of Directors of the
Corporation may provide that the stock transfer books shall be
closed for a stated period, but not to exceed in any case fifty
(50) days. If the stock transfer books shall be closed for the
purpose of determining shareholders entitled to notice of or to
vote at a meeting of shareholders, such books shall be closed
for at least fifteen (15) days immediately preceding such
meeting. In lieu of closing the stock transfer books, the board
of Directors may fix in advance a date as the record date for
any such determination of shareholders, such date in any case to
be not more than thirty (30) days and, in case of a meeting of
shareholders, not less than ten (10) days, prior to the date on
which the particular action requiring such determination of
shareholders is to be taken. If the stock transfer books are
not closed and no record date is fixed for the determination of
shareholders entitled to notice of or to vote at a meeting of
shareholders, or shareholders entitled to receive payment of a
dividend, the date on which notice of the meeting is mailed or
the date on which the resolution of the Board of Directors
declaring such dividend is adopted, as the case may be, shall be
the record date for such determination of shareholders. When a
determination of shareholders entitled to vote at any meeting of
shareholders has been made as provided in this section, such
determination shall apply to any adjournment thereof.
SECTION 6. Voting Lists. The officer or agent having
charge of the stock transfer books for shares of the corporation
shall make a complete list of shareholders entitled to vote at
each meeting of shareholders or any adjournment thereof,
arranged in alphabetical order, with the address of and the
number of shares held by each. Such lists shall be produced
and kept open at the time and place of the meeting and shall be
subject to the inspection of any shareholder during the whole
time of the meeting for the purposes thereof.
SECTION 7. Quorum. A majority of the outstanding shares
of the Corporation entitled to vote, represented in person or by
proxy, shall constitute a quorum at a meeting of shareholders.
If less than a majority of the outstanding shares are
represented at a meeting, a majority of the shares so
represented may adjourn the meeting from time to time without
further notice. At such adjourned meeting at which a quorum
shall be present or represented, any business may be transacted
which might have been transacted at the meeting as originally
noticed. The shareholders present at a duly organized meeting
may continue to transact business until adjournment,
notwithstanding the withdrawal of enough shareholders to leave
less than a quorum.
SECTION 8. Proxies. At all meetings of shareholders, a
shareholder may vote in person or by proxy executed in writing
by the shareholder or by his or duly authorized attorney-in-
fact. Such proxy shall be filed with the secretary of the
Corporation before or at the time of the meeting. A meeting of
the Board of Directors may be had by means of telephone
conference or similar communications equipment by which all
persons participating in the meeting can hear each other, and
participation in a meeting under such circumstances shall
constitute presence at the meeting.
SECTION 10. Voting of Shares by Certain Holders. Shares
standing in the name of another corporation may be voted by such
officer, agent or proxy as the Bylaws of such corporation may
prescribe or, in the absence of such provision, as the Board of
Directors of such corporation may determine.
Shares held by an administrator, executor, guardian or
conservator may be voted by him either in person or by proxy,
without a transfer of such shares into his name. Shares
standing in the name of a trustee may be voted by him, either in
person or by proxy, but no trustee shall be entitled to vote
shares held by him without a transfer of such shares into his
name.
Shares standing in the name of a receiver may be voted by
such receiver, and shares held by or under the control of a
receiver may be voted by such receiver without the transfer
thereof into his name, if authority to do so be contained in an
appropriate order of the court by which such receiver was
appointed.
A shareholder whose shares are pledged shall be entitled to
vote such shares until the shares have been transferred into the
name of the pledgee, and thereafter the pledgee shall be
entitled to vote the shares so transferred.
Shares of its own stock belonging to the Corporation shall
not be voted directly or indirectly, at any meeting, and shall
not be counted in determining the total number of outstanding
shares at any given time.
SECTION 11. Informal Action by Shareholders. Unless
otherwise provided by law, any action required to be taken at a
meeting of the shareholders, or any other action which may be
taken at a meeting of the shareholders, may be taken without a
meeting if a consent in writing, setting forth the action so
taken, shall be signed by all of the shareholders entitled to
vote with respect to the subject matter thereof.
ARTICLE III: BOARD OF DIRECTORS
SECTION 1. General Powers. The business and affairs of
the Corporation shall be managed by its Board of Directors.
SECTION 2. Number, Tenure and Qualifications. The number
of directors of the Corporation shall be fixed by the Board of
Directors, but in no event shall be less than one ( 1 ). Each
Director shall hold office until the next annual meeting of
shareholder and until his successor shall have been elected and
qualified.
SECTION 3. Regular Meetings. A regular meeting of the
Board of Directors shall be held without other notice than this
Bylaw immediately after, and at the same place as, the annual
meeting of shareholders. The Board of Directors may provide, by
resolution, the time and place for the holding of additional
regular meetings without notice other than such resolution.
SECTION 4. Special Meetings. Special meetings of the
Board of Directors may be called by or at the request of the
President or any two directors. The person or persons
authorized to call special meetings of the Board of Directors
may fix the place for holding any special meeting of the Board
of Directors called by them.
SECTION 5. Notice. Notice of any special meeting shall be
given at least one (1) day previous thereto by written notice
delivered personally or mailed to each director at his business
address, or by telegram. If mailed, such notice shall be deemed
to be delivered when deposited in the United Sates mail so
addressed, with postage thereon prepaid. If notice be given by
telegram, such notice shall be deemed to be delivered when the
telegram is delivered to the telegraph company. Any directors
may waive notice of any meeting. The attendance of a director
at a meeting shall constitute a waiver of notice of such
meeting, except where a director attends a meeting for the
express purpose of objecting to the transaction of any business
because the meeting is not lawfully called or convened.
SECTION 6. Quorum. A majority of the number of directors
fixed by Section 2 of the Article III shall constitute a quorum
for the transaction of business at any meeting of the Board of
Directors, but if less than such majority is present at a
meeting, a majority of the directors present may adjourn the
meeting from time to time without further notice.
SECTION 7. Manner of Acting. The act of the majority of
the directors present at a meeting at which a quorum is present
shall be the act of the Board of Directors.
SECTION 8. Action Without a Meeting. Any action that may
be taken by the Board of Directors at a meeting may be taken
without a meeting if a consent in writing, setting forth the
action so to be taken, shall be signed before such action by all
of the directors.
SECTION 9. Vacancies. Any vacancy occurring in the Board
of Directors may be filled by the affirmative vote of a majority
of the remaining directors though less than a quorum of the
Board of Directors, unless otherwise provided by law. A
director elected to fill a vacancy shall be elected for the
unexpired term of his predecessor in office. Any directorship
to be filled by reason of an increase in the number of directors
may be filled by election by the Board of Directors for a term
of office continuing only until the next election of directors
by the shareholders.
SECTION 10. Compensation. By resolution of the Board of
Directors, each director may be paid his expenses, if any, of
attendance at each meeting of the Board of Directors, and may be
paid a stated salary as a director or a fixed sum for attendance
at each meeting of the Board of Directors or both. No such
payment shall preclude any director from serving the Corporation
in any other capacity and receiving compensation thereof.
SECTION 11. Presumption of Assent. A director of the
Corporation who is present at a meeting of the Board of
Directors at which action on any corporate matter is taken shall
be presumed to have assented to the action taken unless his
dissent shall be entered in the minutes of the meeting or unless
he shall file his written dissent to such action with the person
acting as the Secretary of the meeting before the adjournment
thereof, or shall forward such dissent by registered mail to the
Secretary of the Corporation immediately after the adjournment
of the meeting. Such right to dissent shall not apply to a
director who voted in favor of such action.
ARTICLES IV: OFFICERS
SECTION 1. Number. The officers of the corporation shall
be a President, one or more vice Presidents, a Secretary and a
Treasurer, each of whom shall be elected by the Board of
Directors. Such other officers and assistant officers as may be
deemed necessary may be elected or appointed by the Board of
Directors, including a Chairman of the Board. In its
discretion, the Board of Directors may leave unfilled for any
such period as it may determine any office except those of
President and Secretary. Any two or more offices may be held by
the same person. Officers may be directors or shareholders of
the Corporation.
SECTION 2. Election and Term of Office. The officers of
the Corporation to be elected by the board of Directors shall be
elected annually by the board of Directors at the first meeting
of the Board of Directors held after each annual meeting of the
shareholders. If the election of officers shall not be held at
such meeting, such election shall be held as soon thereafter as
conveniently may be. Each officer shall hold office until his
successor shall have been duly elected and shall have qualified,
or until his death, or until he shall resign or shall have been
removed in the manner hereinafter provided.
SECTION 3. Removal. Any officer or agent may be removed
by the Board of Directors whenever, in its judgement, the best
interests of the Corporation will be served thereby, but such
removal shall be without prejudice to the contract rights, if
any, of the person so removed. Election or appointment of an
officer or agent shall not of itself create contract rights, and
such appointment shall be terminable at will.
SECTION 4. Vacancies. A vacancy in any office because of
death, resignation, removal, disqualification or otherwise, may
be filled by the Board of Directors for the unexpired portion of
the term.
SECTION 5. President. The president shall be the
principal executive officer of the Corporation and, subject to
the control of the Board of Directors, shall in general
supervise and control all of the business and affairs of the
Corporation. He shall, when present, preside at all meetings of
the shareholders and of the Board of Directors, unless there is
a Chairman of the Board, in which case the Chairman shall
preside. He may sign, with the Secretary or any other proper
officer of the Corporation thereunto authorized by the Board of
Directors, certificates for shares of the Corporation, any deed,
mortgages, bonds, contract, or other instruments which the Board
of Directors has authorized to be executed, except in cases
where the signing and execution thereof shall be expressly
delegated by the Board of Directors or by there Bylaws to some
other officer or agent of the Corporation, or shall be required
by law to be otherwise signed or executed; and in general shall
perform all duties incident to the office of President and such
other duties as may be prescribed by the Board of Directors from
time to time.
SECTION 6. Vice President. In the absence of the
president or in the event of his death, inability or refusal to
act, the Vice President shall perform the duties of the
President, and when so acting, shall have all the powers of and
be subject to all the restrictions upon the President. The Vice
President shall perform such other duties as from time to time
may be assigned to him by the President or by the Board of
Directors, If there is more than one Vice President, each Vice
President shall succeed to the duties of the President in order
of rank as determined by the Board of Directors. If no such
rank has been determined, then each Vice President shall succeed
to the duties of the President in order of date of election, the
earliest date having the first rank.
SECTION 7. Secretary. The Secretary shall: (a) keep the
minutes of the Board of Directors in one or more minute books
provided for the purpose; (b) see that all notices are duly
given in accordance with the provisions of the Bylaws or as
required by law; (c) be custodian of the corporate records and
of the seal of the Corporation and see that the seal of the
Corporation is affixed to all documents, the execution of which
on behalf of the Corporation under its seal is duly authorized;
(d) keep a register of the post office address of each
shareholder which shall be furnished to the Secretary by such
shareholder; (e) sign with the President certificates for share
of the Corporation, the issuance of which shall have been
authorized by resolution of the Board of Directors; (f) have
general charge of the stock transfer books of the Corporation,
and (g) in general perform all duties incident to the office of
the Secretary and such other duties as from time to time may be
assigned to him by the President or by the Board of Directors.
SECTION 8. Treasurer. The Treasurer shall: (a) have
charge and custody of and be responsible for all funds and
securities of the Corporation; (b) receive and give receipts
for moneys due and payable to the Corporation in such banks,
trust companies or other depositories as shall be selected in
accordance with the provisions of Article VI of these Bylaw; and
(c) in general perform all of the duties incident to the office
of Treasurer and such other duties as from time to time may be
assigned to him by the President or by the Board of Directors.
If required by the Board of Directors, the Treasurer shall give
a bond for the faithful discharge of his duties in such sum and
with such sureties as the Board of Directors shall determine.
SECTION 9. Salaries. The salaries of the officers shall
be fixed from time to time by the Board of Directors, and no
officer shall be prevented from receiving such salary by reason
of the fact that he is also a director of the Corporation.
ARTICLE V: INDEMNITY
The Corporation shall indemnify its directors, officers and
employees as follows:
(a) Every director, officer, or employee of the Corporation
shall be indemnified by the Corporation against all expenses and
liabilities, including counsel fees, reasonable incurred by or
imposed upon him in connection with any proceeding to which he
may become involved, by reason of his being or having been a
director, officer, employee or agent of the Corporation or is or
was serving at the request of the Corporation as a director,
officer, employee or agent of the corporation, partnership,
joint venture, trust or enterprise, or any settlement thereof,
whether or not he is a director, officer, employee or agent at
the time such expenses are incurred, except in such cases
wherein the director, officer, or employee is adjudged guilty of
willful misfeasance or malfeasance in the performance of his
duties; provided that in the event of a settlement the
indemnification herein shall apply only when the Board of
Directors approves such settlement and reimbursement as being
for the best interests of the Corporation.
(b) The Corporation shall provide to any person who is or
was a director, officer, employee, or agent of the Corporation
or is or was serving at the request of the Corporation as
director, officer, employee or agent of the corporation,
partnership, joint venture, trust or enterprise, the indemnity
against expenses of suit, litigation or other proceedings which
is specifically permissible under applicable law.
The Board of Directors may, in its discretion, direct the
purchase of liability insurance by way of implementing the
provisions of the Article V.
ARTICLE VI: CONTRACTS, LOANS, CHECKS, AND DEPOSITS
SECTION 1. Contracts. The Board of Directors may
authorize any office or officers, agent or agents, to enter into
any contract or execute and deliver any instrument in the name
of and on behalf of the Corporation, and such authority may be
general or confined to specific instances.
SECTION 2. Loans. No loans shall be contracted on behalf
of the Corporation and no evidences of indebtedness shall be
issued in its name unless authorized by a resolution of the
Board of Directors. Such authority may be general or confined
to specific instances.
SECTION 3. Checks, Drafts, etc. All checks, drafts or
other orders for the payment of money, notes or other evidences
of indebtedness issued in the name of the Corporation, shall be
signed by such officer or officers, agent or agents of the
Corporation and in such manner as shall from time to time be
determined by resolution of the Board of Directors.
SECTION 4. Deposits. All funds of the Corporation not
otherwise employed shall be deposited from time to time to the
credit of the Corporation in such banks, trust companies or
other depositories as the Board of Directors may select.
ARTICLE VII. CERTIFICATES FOR SHARES AND THEIR
TRANSFER
SECTION 1. Certificates for Shares. Certificates
representing shares of the Corporation shall be in such form as
shall be determined by the Board of Directors. Such
certificates shall be signed by the President and by the
Secretary or by such other officers authorized by law and by the
Board of Directors so to do, and sealed with the corporate seal.
All certificates for shares shall be consecutively numbered or
otherwise identified. The name and address of the person to
whom the shares represented thereby are issued, with the number
of shares and date of issue, shall be entered on the stock
transfer books of the Corporation. All certificates surrendered
to the Corporation for transfer shall be cancelled and no new
certificate shall be issued until the former certificate for a
like number of shares shall have been surrendered and cancelled,
expect that in case of a lost, destroyed or mutilated
certificate a new one may be issued therefore upon such terms
and indemnity to the Corporation as the Board of Directors may
prescribe.
SECTION 2. Transfer of Shares. Transfer of shares of the
Corporation shall be made only on the stock transfer books of
the Corporation by the holder of record thereof or by his legal
representative, who shall furnish proper evidence of authority
to transfer, or by his attorney thereunto authorized by power of
attorney duly executed and filed with the Secretary of the
Corporation, and on surrender for cancellation of the
certificate for such shares. The person in whose name shares
stand on the books of the Corporation shall be deemed by the
Corporation to be the owner thereof for all purposes, Provided,
however, that upon any action undertaken by the shareholder to
elect S Corporation status pursuant to Section 1362 of the
Internal Revenue Code and upon any shareholders agreement
thereto restricting the transfer of said shares so as to
disqualify said S Corporation status, said restriction on
transfer shall be made a part of the Bylaws so long as said
agreements is in force and effect.
ARTICLE VIII: FISCAL YEAR
The fiscal year of the Corporation shall begin on the 1st
day of January and end on the 31st day of December of each year.
ARTICLE IX: DIVIDENDS
The Board of Directors may from time to time declare, and
the Corporation may pay, dividends on its outstanding shares in
the manner and upon the terms and condition provided by law and
its Articles of Incorporation.
ARTICLE X: CORPORATE SEAL
The Board of Directors shall provide a corporate seal which
shall be circular in form and shall have inscribed thereon the
name of the Corporation and the state of incorporation and the
words, Corporate Seal.
ARTICLE XI: WAIVER OF NOTICE
Unless otherwise provided by law, whenever any notice is
required to be given to any shareholder or director of the
Corporation under the provision of the Articles of Incorporation
or under the provisions of the applicable Business Corporation
Act, a waiver thereof in writing, signed by the person or
persons entitled to such notice, whether before or after the
time stated therein, shall be deemed equivalent to the giving of
such notice.
ARTICLE XII: AMENDMENTS
These Bylaws may be altered, amended or repealed and new
Bylaws may be adopted by the Board of Directors at any regular
or special meeting of the Board of Directors.
The above Bylaws are certified to have been adopted by the Board
of Directors of the Corporation on the _____ day of June, 1999.
Vincent van den Brink, Secretary
EXHIBIT 27
INFORMATION EXTRACTED FROM THE MORGAN CLARK
MANAGEMENT, INC. FINANCIAL STATEMENTS FOR THE
PERIOD ENDED SEPTEMBER 30, 1999 AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
